Shark Tank Survival: Investment Tips for Entrepreneurs
| 3 minutes read
- Every entrepreneur wants investors to invest in their company, but Sharks invest after checking the vision and the opportunity.
- When you are looking for an investment, build the roadmap and be prepared to answer all the questions.
- Prepare answers to these questions like “Why do you want an investment? How will you make a profit? What is your business model? How much return can you give to your investors?” And many other questions.
This article is especially for entrepreneurs seeking investments to grow their small businesses.
Investment is the work every entrepreneur love, and they dream of getting investment from big sharks. Now the question is, why is it unique in your business? Why sharks should invest in your industry. To know the reasons in detail kindly read the article till the end.
Investment Tips From the Sharks
Here are some important investment guides for entrepreneurs who need funding for their startups to grow and swim with the sharks.
1. Gain traction first.
If you are already offering the product and services, showcase the traction as much as possible. In the investment world, ‘traction’ is the magic word. Traction could be many things. It can be registered users, press articles, paying customers, getting a large audience, partnerships, or even a handful group of people who couldn’t live without what you are offering. To offer a product that they can’t ignore and is tough to live without.
Traction is the most efficient and effective way to prove that your solution creates interest and is monetizable.
2. Control your risk.
Everyone says business involves risk, but it doesn’t mean you will go bankrupt. If you want to be a good entrepreneur you should minimize risks by controlling your risk. Many professionals never risk more than 3percent to 5percent of their account, if things go wrong then more than a 95percent of the amount is still intact.
Involving risk and controlling risks are the two things you have to be pro if you want to carry and operate your business for the long term. As a result, you have to be a master at controlling risks.
3. Research the competition.
If you’re starting a business, chances are you will clash with your competitors, the monopoly market is very selective, and therefore still, you will get your competitors. However, you should research your competitor’s audiences, products, presence on social media, and latest strategies. This will give you an idea of how you could be different and give more effective solutions to your audiences. Don’t focus just on products; focus on your solutions’ effectiveness.
4. Test your product.
It doesn’t matter how good and aggressive your marketing is. But, sadly, if you do not offer a good product, your product will fail.
Test your product through a joint development program, this will create faith in investors and trust amongst investors and customers. Always remember if you do not invest a lot in marketing but if your product is worth the price and delivers solutions to your consumers, your product will be a massive hit.
Additional tips and advice for a successful investor search
Crowdfunding is a helpful avenue for entrepreneurs who are looking for investments for their startups. Each crowdfunding platform is specialized for certain funding needs. It is a donation kind of funding companies ask for. In return, the company gives coupon codes, discounts on their products, and many other benefits.
2. Ask Friends and Family
This might be the easiest and most cost-effective way of raising money for your startup.
Talk to your family and friends about your business plan and its requirements. You need to make it clear if you want a loan from them or if you want investment funds. A loan may be the easiest for both parties in certain situations – you just pay it back over time, with interest.
3. Angel investors
Angel investors invest their capital in a startup, especially when the business is just beginning. An angel’s investment will mean his shares in the company. Companies like Amazon and Apple both got their start by aligning with angel investors.
They may simply like your plan, trust your goals and vision, and believe that your business will be successful.
4. Venture Capitalists (VCs)
Venture capitalists are needed when a business is growing and perhaps heading into a riskier venture. Venture capitalists do not use their own money, but that of investors (additionally, they set up a fund used for others to buy shares in the company).
Although venture capitalists can help a startup, they typically come into a business once it’s already been recognized. This is because it has a solid and effective management team and has already proven successful.
Suprotik Sinha is the Content Writer with Synkrama Technologies. He writes about technologies and startups in the global enterprise space. An animal lover, Suprotik, is a postgraduate from Symbiosis Institute of Mass Communication (SIMC) Pune. He carries 6+ years of experience in Content Writing, and he also worked in mainstream broadcast media, where he worked as a Journalist with Ibn7 ( now known as News18 India) and Zee Media in Mumbai.