The old school ways of raising capital just don’t cut it anymore. You know, like hitting up friends and family, asking for introductions, and networking like crazy. In this article, we’ll provide you with some straightforward tactics that you can put into action right now to shake things up and start seeing results.
The Right Way To Close More Investors
You’ve probably heard the usual advice on raising capital, right? But let’s be real here: closing investors, especially in the world of investment sales can be time consuming, messy and stressful. A study notes that most U.S. PE funds haven’t been outperforming public stocks in the last 15 years or so, and that’s not exactly a confidence booster (University of Oxford, 2020). Plus, when you’re up against fierce competition and dealing with investors who only throw their cash at a handful of deals a year, it’s like climbing Mount Everest in flip-flops. So, how on earth do you earn that all-important trust?
Alright, let’s get down to business —it’s a numbers game, just like job hunting.
Here’s the deal: at any given time, only a measly 3% of prospects are ready to dive in headfirst. Yep, just three percent! Now, think about all those emails you’ve fired off only to be met with radio silence. Sounds familiar? And what about those times when someone says, “Now’s not quite the right time”? Do you throw in the towel and move on to the next lead? If that’s been your approach, you’ve been chasing after that elusive 3%.
But hey, here’s a glimmer of hope: a whopping 37% of investors are game to seal the deal if you give that relationship a little TLC after that first contact. So, how do you make it happen? Let me lay it all out for you.
- Personalize your outreach
Let’s kick things off by building a real bond with your prospects right from the start. Drop their first name, throw in some personal details you’ve dug up, and let them know you’ve put in the effort. It’s all about forging that connection, you know? (and if you haven’t hopped on the CRM train yet, consider this your gentle nudge). Your follow-up email could look like this:
Hey Steve,
Hope things are going great in California! Remember our last chat where you mentioned your interest in Scribble Tech? Well, I’m currently raising funds for the DBALP Ventures Fund II, and I’ve got a feeling it could be right up your alley. Feel free to hit me up if you want to chat about it!
- Use behavioral data
Behavioral data is like having insider info before the big test. When you’re raising capital, you’ll likely use a data room. This helps you understand investor behavior, like how long they’re peeking at your docs, which parts they’re diving into, and what they’re skipping over. It’s like reading their minds! By gathering data from all your contacts, you can quickly figure out what’s working and what’s just fluff. For instance, say an investor tells you they’re keen on investing if you’ve got a lead. But, after peeking into your data room for a quick sec, they’re out. They might never flat-out say no, though. This let’s you understand why they said no, even if they never tell you.
- Target the 37%
Forget about spinning your wheels chasing after that tiny 3% slice of the pie. Shift gears and set your sights on nurturing the 37% who are itching to seal the deal with just a nudge in the right direction. Treat them like royalty, give them the VIP treatment, and watch those investments start flowing in. After all, why waste time on the 3% when the real action is with the 37%, right?
- Nurture your leads
It’s not just about sending emails; it’s about adding value with every interaction. Share insightful articles, offer valuable tips, or simply show off your personality. Make them feel special like they’re more than just a name on your list. After all, building a genuine connection is the key to turning leads into loyal investors.
So, there you have it! Capital raising might be tough, but with the right approach and the right tech stack like WealthBlock, you can make it a whole lot easier. Start collecting data, use it smartly in your outreach efforts, and watch the investments roll in. It’s not just about having the right tech partner—it’s also about how you utilize and leverage them to your advantage.
Now, go work your magic and make those investment dreams a reality, baby!