Small Talks features insider expertise from successful small business owners. This video series highlights how real entrepreneurs overcame their most pressing challenges, so you can apply the insights to your own business.
3 tips for finding the right investors from Deluxe Corporation on Vimeo.
After a stressful 2-hour visit to the emergency vet, Zubin Bhettay of San Francisco was left with a hefty bill and the inspiration to make veterinary care more accessible, affordable and easier for pet parents. He founded Fuzzy in 2015 to make veterinary clinic visits a thing of the past by delivering in-home veterinary care in a convenient, membership model. Bhettay came up with a compelling elevator pitch that piqued the interest of several investors, but he wasn't about to settle for a bird-in-the-hand. He chose investors who were right for his business and that has made all the difference. He shares some tips for screening and selecting the right investors — and securing funds for the long haul:
Identify the right investors
It’s easier to get out of a marriage than it is to get out of a relationship with an investor, so choose wisely. Are they easy to get along with? Do they believe in your mission? You don't want an investor to join your board and then go against everything your company stands for, so make sure they fit your company culture. Find out what their interests are and what other businesses they've invested in. Have they worked with businesses that you admire? If so, the investor may be someone you want to work with. Don't forget to also take a look at the success rate of the companies they've worked with.
Craft a tailored pitch
Tell potential investors your story, explaining why you’re the right person to make this business successful, what level of financing you’re looking for and the next set of milestones their funding will help you achieve. You should be thorough, providing a synopsis of your business model, information about your product or service, insights into your customer base, projections about the return on investment, and an explanation of your growth strategy.
Keep digging to ensure they are the right fit
A bad capitalization table can be a serious headache for your startup, so be sure to vet potential investors accordingly. You should be asking questions about the investment process, other companies they've invested in and how they support the companies they invest in. Do your due diligence and check their references to ensure that you’re making the right choice about who you bring in as an investor.
Watch the full video for more insights.