Make Sure Investors Remember by
Creating a Buzz about Your Deal
There can never be any guarantees in the process
of connecting your company with capital because there are so many factors that impact an investor’s decision to invest.
Unfortunately, even when a company has none of these obstacles, they can still fail in their quest for private equity funding
because the interest of the investor wanes. An institutional investor or venture capital firm may decide they
need to diversify and will not invest in a specific sector, even though they professed interest right up to negotiations of
a term-sheet. A private investor may decide to invest in another project that rings a specific emotional bell
or may have a personal matter that needs attention, sidelining any private equity investment transaction. Often, entrepreneurs
make the mistake blitzing through investors and never providing updates, so when the circumstances change and the investor
is ready, they are onto the next new opportunity rather than the deal they saw two months before. They either assume
the company got their funding or have failed since they never heard from them again.
To create a Buzz about your deal and generate momentum
for your offering, you need to tap in to the investor network you are creating with investors. Investors who
liked the deal, but have not yet invested, are your BEST source for potential new investors. Therefore it is important
to keep interested investors updated with news about your company to increase the likelihood of investment. Maintaining
communication, with not yet committed investors, is imperative to a successful capital raise.
Communicate with existing investors so they can
'brag' to their friends (and potential investors). Have
an 'elevator pitch' with an easy verbal explanation, so that after the presentation, investors walk away able, and desiring
to talk about this hot offering they just saw.