How to find an investor for your startup

There are investors everywhere, waiting eagerly to invest in a great business idea. The question is, how to find them?

Some startups feel they are in a unique category. They believe that since they are developing a great, innovative business, that they could not possibly find an investor who would “specialize” in this non-existent category.

This post will not only challenge that notion but will also share information on where these investors are seeking their next opportunity.

What gets funded

The businesses that get funded are the ones that know their niche.

Money (or lack thereof) is a hallmark problem for startups. Meanwhile, investors are on the prowl for opportunities now. Many are strongly interested in new ideas and want to find a startup to support. Most investors only invest in certain business categories, and these investors can find it difficult to locate a well-aligned business for their portfolio.

Entrepreneurs are wise to find investors with a complimentary niche. This will greatly increase the odds for partnership. After all, a real estate investor is not likely to seek a software startup to fund (unless, perhaps, it is a real estate software).

There are investors who only invest in technology-enabled products and services. There are others who only invest in music and arts. The categories go on, and they get pretty specific:

• Security
• Sustainable products and services
• Affordable housing
• Digital currency
• Agriculture
• Music
• CleanTech
• Digital media
• E-commerce
• Life sciences
• Medical devices
• Health IT
• Marketplaces
• Financial technology

This is very good news for startups in any category. It implies that there is an investor for everyone. No matter how unique, innovative, large or small a business idea may seem, there is likely an investor who would be interested. The question is, where can one find those investors?

Investors can be found by location, interest, business type and funding amount. (Source)

Where to find investors

Investors are seeking their next funding opportunity in a few places. Many are gravitating to online platforms, where they have more control over their options without dealing with a business broker. Many sites show lists of individual investors looking for new opportunities to consider. Investors can be found by location, interest, business type, and funding amount.

Investors are also attending pitching events more than ever. Yes, shows like Shark Tank help with increasing publicity to pitch-style events, but they have been a staple in the investor community for a long time. Pitching events are frequently held with minimal press or marketing beforehand, which means only the hunters of the entrepreneur world will know about them.

Still, other investors rely on networking through online groups. LinkedIn and Facebook have quite a few investor-only groups as well as entrepreneur groups. Both group types can be a great resource for talking directly with investors.

What search terms to use

First, know what type of investor is best for your business. You can search for many types of investor, including venture capitalists, angel investors, investor funds, or private investors. Your business will not be a good fit for all types, so make sure you are only contacting investors who are looking for businesses like yours and who specialize in the stage of business that aligns with your startup.

Startups interested in pitching events should search for “pitch-events”, “startup competition”, and “investor search” plus their zip code to find local events on the horizon.

Many startups qualify to draw attention from niche investors and should target those investors first.

For instance, if you are a woman, minority, veteran, or millennial, there are many investors who only invest in businesses run by people like you.

Try searching for a niche + your target investor type. For example:

“women entrepreneur angel investors”

“music business venture capital funds”

“healthcare investor”

Before contacting any investor, have a business plan ready with full financial projections and detailed market research. If funding needs are more than $100,000, then consider hiring a business plan consultant to make sure it is done to investor standards.

Money is everywhere, and investors are abundant. Entrepreneurs who stay diligent and search with strategy will increase their odds of finding the funding they need for their business.

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DISCLAIMER: This article expresses my own ideas and opinions. Any information I have shared are from sources that I believe to be reliable and accurate. I did not receive any financial compensation in writing this post, nor do I own any shares in any company I’ve mentioned. I encourage any reader to do their own diligent research first before making any investment decisions.