It’s common knowledge that 95% of startup businesses fail within the first five years. There are about 20 ways this can happen, the number one reason being a poor business model leading to a lack of market interest. The number two reason is a lack of money.
Warren Buffet’s saying that cash is like oxygen to a business exists for a reason. A company cannot survive without money, which is why garnering the attention of investors is crucial to a young company. Even after coming up with the most brilliant business idea, writing a textbook-perfect business plan, and marketing your brand across several mediums, your company is still statistically guaranteed to fail without proper financing.
The 64/4 rule states that, if chosen wisely, 4% of the effort you make will lead to a 64% increase in the success of your business. The trick is to pinpoint those high-impact activities that will get you the most powerful results without wasting time and resources. Networking is the number one way to accomplish this.
Contrary to popular belief, networking no longer means showing up to lunches and cocktail parties and handing out business cards. In today’s world, it has evolved into a much more technical, intuitive, and multi-layered methodology of building connections with a variety of audiences. The main idea of today’s networking is about building lasting relationships that are based on integrity, trust, transparency, and profitability. A stellar reputation will, in turn, lead to new branches of connections that emerge from your existing connections.
Many successful entrepreneurs understand the value of selling themselves and their brand in a way that people can not only relate to but also believe in. Most investors are used to being continuously pitched ideas by people who want their money. Chances are, there are already at a point of ennui when they get to you. For this reason, it’s important to make yourself stand out from your competitors straight away by selling yourself and showing your value. Many people talk about X-factors. These are the unique qualities that make you stand out from your competitors, and these are what you should highlight.
While it is true that data is important, potential investors want to be able to relate to a story and an idea. Approximately 5% of attendees remember data that is presented, as opposed to 63% who will recall a touching story. Have a backstory that caters to why you’re so passionate about achieving your dreams. While it is good to rehearse a story well enough to be able to repeat it, its just as important to tweak it accordingly according to your audience to make it sound less rehearsed. A crowdsourcing page is going to look a lot different than a venture capitalist pitch, for example.