How to Get Connected With the Top Investors?

You already have the business idea. Maybe you have started your company or made your first sales with your startup. You are in the growth phase and want the perfect start for your new business. One of the major hurdles you are likely to encounter is a lack of capital. That’s why it’s essential to learn how you can raise capital for your business. Connecting with investors is one of the best ways to go about this.

Where can I connect with top investors? And what role do the so-called stages – i.e., growth phases – which your startup is currently in play here? In this article, we would like to help you know how to find investors.

Different Stages of Funding

Venture capital investors finance startups in the early stages and accompany them in developing, growing, and expanding their business model.
The development of a startup into a "mature" company is typically divided into four different phases, of which the first three (seed stage, early stage, and growth stage) are financed by venture capital.

The fourth phase (Later Stage), at the latest, is aimed at the exit of the venture capital investors. Various financing rounds correspond to the development phases, which differ according to the number and type of investors and the investment volume.

What Is Seed Round Funding?

Seed round funding or financing is an investment usually done during the initial stages of a company’s growth. In contrast to conventional investors and types of financing, venture capital investors get involved in a very early phase of the young company (startups) and support the founders’ right from the start of the company.

The classic investors in the seed round funding stage are primarily friends, family, or acquaintances. If the founders don’t have enough funds, either from their funds or from friends and family, so-called business angels or top investors often give the young company financial support and stand by them as advisors. Other sources of funding are local incubators or state prizes and subsidies.

In seed round funding, the founders’ focus is primarily on implementing their idea and the concept or product development. It’s about analyzing the marketability of the concept or product and converting your own idea into a convincing and viable business plan. You should connect with investors to raise capital to help your business grow.

How to Connect With Top Investors?

Prepare investor search: Which investor suits you?

Not every type of investor is necessarily suitable for your company. Many invest only in the later growth stages of companies, while others enter the company during the seed round funding stage. Here, you should have an overview of the types of investors to know which ones to look for.

Some of the popular types of investors include:

Incubators - Institutions that accompany entrepreneurs to self-employment
Business angel- An experienced entrepreneur who owns shares in the company
Company builder- Investors who not only give money but create structures
Venture capital companies- Financing existing startups with equity and mezzanine capital, aiming for a successful exit

Other criteria for choosing an investor:

How much capital do you need: for some investors, a startup is either too small or too big!
Portfolio: In which companies do the investor hold shares?
Track record: What references and successes can the investor show?
Geographic focus: In which countries is the donor involved?
Sector focus: Which sectors is the investment focused on?
How serious is the investor?

Find Investors: The Best Ways

Cold acquisition: At the beginning, there is the targeted research for possible investors, then the approach takes place.
Professional investor brokers and brokerage portals are other ways to find investors.
Visiting events: Here, you can get to know the scene, address investors in a targeted manner or participate in pitches.
Participation in competitions: Prize money and attention in the media beckon. The startups not on the winners’ podium also benefit because many competitions offer to coach, feedback on the business idea or business plan, and the opportunity to make contacts.
Personal contacts and recommendations: good contacts with donors are essential. Therefore, startups invest time in building up a good network.

Pitching events, founders’ get-togethers, and conferences are events where founders can find investors. At the pitching event, startups present their concept in short keynote speeches.

Convince the Investor: Pitch Deck and Financial Plan

Finding investors is one thing. Once you have made contact with the investor, the moment of truth comes: the investor presentation for your business idea.

Inspire with a pitch deck or one-pager, convince with the business plan. Important: The investor, as the addressee of the business plan, is primarily interested in the possible return and the chances of a lucrative exit.

9 Mistakes to Avoid When Looking For Investors

Proceed unsystematically: look for investors randomly or too late.
Pitch deck spamming: Indiscriminate sending of investor presentations instead of personal contact and good preparation.
Respond too late to investor inquiries.
Don’t attend events.
Unprofessional documents: Pitch deck & Co are not very concise.
Sales planning is unrealistic.
The budget is incomplete.
Lack of harmony in the founding team.
View unrealistic ratings.

Successful startups, on the other hand, choose the right type of investor, address them specifically, present the unique selling proposition (USP) of the business idea perfectly and create a win-win situation when the deal is closed.

The Use of Digital Platforms to Connect With Top Investors

The digital space has created an avenue where you can connect with millions of people out there. You can utilize social networking platforms like LinkedIn to pitch your idea and connect with top investors. There are also websites specifically built for this.

AngelMatch is an excellent platform connecting you with thousands of top investors in seconds. With over 90,000 venture capitalists and business angels in one place, the platform helps you save time and frees you from the hassle of looking for investors. AngelMatch has a vast database that is updated regularly, where you will find investors from various sectors and top VC funds like Benchmark, Andreessen Horowitz, and Sequoia. The platform saves you time because you can filter your searches according to your industry and find the right investor for your startup.