Getting startup capital is easy if you have a good idea and know the right investor. If you’ve spent serious time thinking about becoming an entrepreneur or you’re already in the early stages of business development, you probably already have a good idea (and if you don’t, you’re in the process of improving it). The bigger problem, then, is meeting the right investor.
Some people attribute this fortuitous meeting to luck or preexisting connections, but savvy entrepreneurs go out of their way to meet the right people. Like anything else in life, it comes down to being in the right place at the right time. And while it’s virtually impossible to time things perfectly (since every investor’s going to have a unique schedule), you can at least increase your chances of meeting the perfect candidate by scouting the right places.
These are the five most common places where entrepreneurs meet investors:
1. Networking Events. Networking events are designed to help people meet other people, and if there are investors in your area looking to pour money into a new startup, you can bet they’ll be scouting the local networking events. Attending can take some getting used to, especially if you aren’t used to professional networking, but once you get a feel for the patterns of conversation and introduction, you’ll have no problem quickly identifying the people in the room who can help you get closer to your goals. As an added bonus, you’ll have the opportunity to meet all kinds of new people who can also help grow your business, from mentors to partners and everything in between.
2. Hackathons and Competitions. Most major cities sponsor occasional competitions that get programmers, entrepreneurs, marketers, and other businesspeople together in a competition. Some of these work to launch new startups from scratch, while others simply work on solving collective problems. Either way, these events are magnets for talent and new ideas, which also makes them magnets for investors. Get involved with the competition as a competitor directly, or simply attend and start meeting some new people.
3. Community Organizations. Most active investors give back to their communities in more ways than just startup capital. They’re involved on local boards and community organizations as influencers, social activists, or (quite frankly) because they want to keep up appearances. Whatever the case may be, volunteer events and community organizations are perfect opportunities to meet new investors. Even if you don’t meet them directly, you can meet someone who does know them (more on this later).
4. LinkedIn and Other Networking Platforms. LinkedIn is arguably the best professional networking platforms because it appeals to such a wide audience. Already, you may have used LinkedIn to find a job, hire an employee, or connect with a new acquaintance — so what’s stopping you from using it to find a potential investor? A handful of savvy searches can introduce you to a group of new investors, who you can then reach out to at your leisure. Also consider the fact that there are other networking platforms online with even more specific intentions — take, for instance, AngelList, which helps connect startup entrepreneurs with investors and workers.
5. Mutual Contacts. Okay, I’ll admit it — this one is a method, not a physical location, but it’s still one of the most popular and most effective ways to meet new investors. Some investors tend to avoid the spotlight, so it’s hard to meet them in person and meeting them through a mutual contact is the only way to get an introduction. Others network like crazy, and even if you miss them at a networking event, it won’t be long before you meet someone who happens to know them. Either way, meeting them through other people is the best way to get in contact. What types of people can introduce you to investors? It could be a colleague, a neighbor, a waiter, or even a stranger — you just never know. Therefore, it’s in your best interest to use all the strategies above (and then some) to meet as many people as possible and keep them in your network.
If you’re having trouble meeting viable investors despite making appearances at the four locations above and going through your mutual contacts, there are two potential problems you face. First, it could be that your idea is premature or underdeveloped, giving the investors you do meet reason to avoid you. The solution to this problem is reworking your idea, potentially from the ground up. Second, if your idea is solid, it could be that investors in your area simply aren’t biting. The solution to this second problem is seeking alternative means of funding, such as crowdfunding or startup loans. There are always opportunities for those who seek them, so don’t give up when you first encounter a challenge.
For more content like this, be sure to check out my podcast, The Entrepreneur Cast!