Capitalists are so closely linked with each other in today’s time that it’s impossible to think about one without another. There are numerous brands which became successful without even having VC’s at their ventures like Facebook or Twitter. But remember that arranging capitals/funds is a daunting task which should not be neglected.
Do your homework
When you are unable to make connections, the next best alternative is to form a proper introduction possible. You could impress the investors by showing them that you have done your homework and you are pretty much aware of your preferred business.
Investors may also ask for an executive summary but, over the past decade, this has become less and less common, with most preferring a pitch deck. Regardless, it’s a good idea to have one prepared — just in case.
Focus on the firms with similar vision
Different franchisors have different strategies for finding investment from other brands/players. You should try to contact as many people possible, along finding venture capital firms that are the best fit for your franchise business.
It is said that the more closely you are aligned with the needs of your venture, the more likely you will find capitals establishing your franchise business.
Consider the following questions while looking for a good VC
- What are the other companies they have invested in?
- What kind of funding they are interested in?
- VC’s are interested in exponential growth. Therefore, how can you enhance your offerings?
- Do your long-term goal matches with the VC’s long-term goal?
The connection is the key
Giving a proper introduction of your franchise business to the venture capital firm could create a huge impact while processing investment. Remember that investment requires great efforts, and people often invest in those who are trustworthy and have a clear vision with their goal.
Every pitch to a venture capital firm starts with an introduction to someone at the firm. It helps to know the exact profile of a venture capitalist to know which level of introduction makes sense.
