18/10/2012

By Simon Dixon, Co Founder, www.Banktothefuture.com

Most investors do not invest in really good ideas. They may think they are investing in the idea, but what they are really investing in, is whether or not they believe you are able to execute upon that idea.

Somebody that has a track record of doing what they say they are going to do and has a track record of following ideas up with action, raises more finance than those who seek investment for ideas.

Everybody has ideas, every child has ideas, we can all think of hundreds of good ideas right now. Very few are able to take their ideas and produce a product or business out of them.

So your job in raising money, is to prove that you can execute on your project or business.

The further away you can get from coming across as somebody with just an idea, the more likely you are to raise finance.
Professional investors always have a good laugh when people try to hold on to their business ‘secret’ ideas, as if nobody has through of it before.

Anything you are doing has probably been thought of by somebody else, but hopefully the difference between you and them is your ability to execute the idea into a reality.

There are 5 main things that investors look for as evidence that you can execute and that you are not simply another one of those idea people like all the other thousands of
ideas that never go past the thought process.

Team

People need to believe that you are more than just one idea person, by showing them a team of people that have relevant experience.

If you are launching a solo project through a CrowdFund, they want to see a team of willing suppliers and helpers all around you.

For example, if you are CrowdFunding a movie, show them the film crew, producers, directors, cast, the whole team so they can see that this is likely to happen.

If you are CrowdInvesting a new technology startup, show a team member to fill all the key functions in business - finance, marketing, HR, sales, operations, technology etc.

A board member that has successfully started and exited a company is worth a lot more than an entrepreneur new to business, so get some experience and grey hairs on your nonexecutive team or board of advisors.

Story

Investors do not buy what you do, they buy why you do it.

Your story needs to come across loud and clear.

In seeing your business and project through to exit or completion, you will face immense challenges. Investors want to know what will keep you going in the challenges and hard times ahead.

Is your passion coming through? Are you doing this for more than just money? Are you inspiring? What makes you different than everybody else?

Learn how to pitch an inspiring story, by studying successful CrowdFund and product launch videos.

IP

If you are launching a CrowdFund, build a prototype, film your pilot, get as far as you can go without finance.

Investors like to see what you have done already.

Make a start, don’t wait for money to get started. Show people that you can rally the support of others for free by getting creative.

Demonstrate your ability to make something out of nothing, so they can see how far you will go when you have their money.

intellectual property refers to the assets that you create that are owned by you the project owner or the business.

A business with assets and intellectual property is worth a lot more to a CrowdInvestor, angel or VC, than a business with no assets.

Build minimum viable products, first draft websites, social media presences, prototypes, pilots, whatever you can come up with that people can see and feel.

Start to build your assets on a shoestring and your valuation as a business goes higher and attracts more investors.

Get client testimonials, feedback and survey
customers to raise more interest.

Social Capital

Demonstrate that you have traction, that your team can market, that people are interested in what you do.

This can be done for free using sites like
, Facebook, Twitter and Google+.

When you create a profile with BankToTheFuture.com, you are able to build your social capital and display it to investors, so they can search for entrepreneurs and projects owned by people that have social capital. You can improve your social capital in four ways.

By building a following online (Influence Score), getting ratings from people that know you offline and being visible on all social networks (Social Score), by looking after your credit rating (Credit Score) and by verifying your identity and using your real name and photo across all social networks (Identity Score).

The world has gone open. The more people that know you, like you, follow you and trust you, the more investment you will attract. This is especially relevant when launching
crowdfunds, crowdloans &CrowdInvestments..

Prove that there is a need for what you do. Businesses that have customers and can demonstrate a hungry buying market will attract more investment.

It will allow you to demonstrate your product or project for a CrowdFund and give you a higher valuation with CrowdInvestors, angels and VC’s.