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Tips For Using Networking Skills To Attract Investors
Tips For Using Networking Skills To Attract Investors
Sex. Politics. Religion. Money. What have they all got in common? Well, they're topics many of us were advised by our parents not to discuss in polite company. Look at the first three subjects. With the relaxed mores of the latter part of the 20th century, and now, in the 21st century, it seems the admonitions of our parents regarding these issues no longer ring true.
I don't know about you, but I sure know far more about the sex lives of prominent people in politics and religion than I care to know. With people like Madonna, Gary Hart, Bill Clinton, Paula Jones, Monica Lewinsky, Bob Dole, Jimmy Swaggart, and Jim Bakker being on the cover of every supermarket tabloid in the the last few years, it's hard NOT to talk about these subjects. We're bombarded by them, we're saturated with them, and we just can't avoid them. Indeed, it seems we just can't get enough of them.
Money, however, is a different issue. We're still not comfortable talking about money. Okay, so maybe we don't have a problem talking about Madonna's money or Bill Clinton's money, or Monica Lewinsky's money. And probably the time has long past when we were even interested in Jim Bakker's money OR his shenanigans, but when it comes to talking about our own money or the money of our close personal friends and associates, for all our sophistication and for all our worldliness, we're still as uncomfortable as we ever were. Think about it. When was the last time you asked a friend how much money they make? It's still a question which embarrasses most people. It's something we just don't want others to know. Money, after all, is just so darned personal. Sex, politics, and religion may have made it into polite circles as acceptable topics at a dinner party, but money is still a forbidden topic, even in this new millennium.
No wonder then, that entrepreneurs looking for investors are often stopped dead in their tracks. They become paralyzed with fear. They often overlook the best resource for funds available because they're too embarrassed to talk about money with their friends, relatives, or associates. They don't want anyone to know they might NEED money to grow their businesses. They wouldn't want people thinking they were NEEDy, after all. Needing money and being "needy" are two separate things, and the sooner the entrepreneur understands that, the sooner he can get started with a plan of action that will help him tap into a resource that is already on his side.
Who am I talking about? The cold, uncaring banker in the glass tower at corporate headquarters? Absolutely not. I'm talking about the people the entrepreneur already knows. People who like, trust and respect him already. People who WANT him to succeed. People who will likely want to be a part of his successes because they CARE about him. I'm talking about his sphere of influence, his circle of friends, his network.
Will everyone in your network jump at the chance to invest in your business? Absolutely not, but you can increase the odds of getting a little help from your friends if you:
--Know who you know. You can't begin to network for investors or anything else for that matter, until you know who is IN your network. Make lists of everyone you know, how you know them, what you know about them, and who you have met through them.
--Approach networking for investors as you would networking for referral business or a new job. It's really the same thing, after all. Change your mindset from looking for money to looking for business. That's really all you're doing. This will help take some pressure off of you.
--Go about your search with a systematic plan of action instead of jumping from person to person in a haphazard fashion.
--Create visibility for yourself. Go to Chamber of Commerce functions, etc. on a regular basis so people get to know you. Going only once in a while doesn't allow you the opportunity to form strong relationships with anyone. It is from those relationships that your network will grow.
--Join and become an active participant in a weekly leads exchange group limited to only one person per occupation. The ones I have operated have lead to millions of dollars worth of referrals for the members. These clubs are gold mines of opportunity for people in your position. Make sure you give LOTS of QUALIFIED leads to the other members. They, in turn, will want to make sure they continue to get those good leads from you and will help you find the investors you are seeking.
--Look at all times as if you don't need the money. The hungrier you look, the less likely it will be that you will find an investor. If you look successful, you will ATTRACT what you are seeking. If you look down on your luck, you will attract a mass exodus from your vicinity.
--Be clear about what you need and why you need it. Don't expect others to figure out how to help you.
--Know your product or service inside out. Be able to answer any question, no matter how off the wall, with a succinct answer. Your prospective investor doesn't want to hear you droning on and on about your business. They just want you to cut to the chase.
--Make your pitch a whine-free zone. Nobody wants to hear about the ten banks that turned you down. They want to listen to positivity and enthusiasm.
--Tell the truth. Don't exaggerate, and be able to substantiate any claims you make.
--Remember that money is still a touchy subject. Never push anyone beyond their comfort zone. It will come back to haunt you.
--This above all else: Know WIIFM (What's In It For Me?)Think like your potential investors. Know how they can benefit from their investment. If they're sold on you they can easily become your strongest ally in helping you find other investors. If they think you've got something great, they'll want to recommend it to others and look good in the eyes of THEIR network.