8 Ways to Impress International Investors
Asia has grown into one of the most dominant and dynamic start-up ecosystems in the world. The lifecycle of many of these start-ups demand facing international investors to scale up business and fuel the growth of new concept, ideas, and synergies.
Navigating international investors and getting them on board is an exciting challenge for a start-up entrepreneur. Once done it is a huge step towards the future of the enterprise. In contrast to facing investor of your own nationality, facing an international investor is definitely more complicated. With domestic funders, one can find common grounds to connect, exchange notes in the industry and share similarities in value systems. Cross-cultural gatherings can be awkward and intimidating and presentations have to be planned accordingly.
The biggest challenge when presenting to a foreign investor is their lack of understanding of the local context. Thus, it’s imperative to do your homework and plan well before making a pitch to investors.
The Story is Important
Most foreign investors have a little social context of a new country they’re looking to invest in. Their knowledge is limited to the myriad business reports, both generic and sectoral, which does not help beyond a point while making an investment decision. It’s incumbent on the entrepreneur to make sure that the investor understands what the business model means in the market that it’ll operate in.
The thread for that story can come from the most commonly known facts about the market. For example, India has the largest youth population in the world or Indonesians were using Instagram for local product discovery and e-commerce as early as 2013. The idea is to help them understand what makes your target markets move and why your idea is rooted in the local context. They’ll never be able to understand your business model if they do not understand the social enablers for your story. Anecdotal stories are a great way to build and establish stories and almost always help. On your presentation, don’t be afraid to use media reports and other references to establish context.
Understand the Structure
Most international funds have country representatives who interact with the founders and share their understanding with their investment committees. Investment decisions are based on the collective inputs of the members of the committee based on their understanding of the growth potential of the business. Thus, your job is not just to convince the investor speaking to you but also prepare them for their investment committee meetings.
Up Your Game
International investors have an obsession with quality and understand the value of brand creation. There are no compromises when it comes to quality of products and services, investors are very cautious in this respect and would stay away if there is slightest of doubt. Brand value creation is also very significant; the investor needs to believe in the power and potential of the brand. It helps to carry/send a well-designed presentation.
You Can Never Be Over-prepared
There will definitely be a detailed discussion and cross questioning about revenue, scalability, traction, future roadmap, and growth prospects both in the local as well as overseas market. Only when you can show them stability and potential will they be interested to associate. So be prepared for all expected questions and some not expected ones as well. Be thorough with your current business standing and the growth you are targeting. Preparing ready references to map your model to what the investor is likely to understand from their domestic market is key.
Enhance your knowledge by studying the global environment – concepts, trends, competition, industry leaders, technology, branding, strategies, etc. This will help you in improvising the quality of interaction; help you understand investor’s mindset and the way they think. It will obviously make your proposal sounder and more impressive. Widen your horizon to focus on the right approach for a spellbound effect.
Be thorough with compliance requirements, international investors are wary of ambiguous or opaque compliance structures. They like to see it in black and white.
Knowledge commands respect and appreciation. Needless to say, that your presentation needs to be top-notch, crisp and effective. It should capture the essence of your business but it cannot be all about the concept alone. A holistic representation but nothing lengthy.
Create a Solid Business Plan
Clarity of business model, calculate the “worth” of your business, risks and likely bottlenecks, forecast revenues and analyse the competitive landscape. All this will help you derive the right investment support you require.
Have the Right Partner by Your Side
Facing an international investor is tricky and one cannot undermine the presence of a partner who would have experience in this area. Someone who has an existing relationship or has handled international investor meetings in the past can really help in making headway and give confidence.
Show Ambition and Not Arrogance
You have established a winning business proposition, which has a glowing future ahead, so it is important to show ambition while interacting with the investors. Still one needs to be very careful and stay away from coming across as arrogant.
Be prepared for a big win.