Business financing | Four golden rules for a convincing case

When the time comes to convince investors to finance a project or the growth of your business, good preparation is the key to success. How to convince them? Here are the four golden rules of Alexandre Sieber, Senior Executive Vice-President, Corporate Financing, at Investissement Québec.

Get informed to aim for the right targets

There are several financing solutions for businesses on the market. To properly prepare the ground, you have to aim for the right target: investors who have business solutions that best meet your needs. “Often, as an entrepreneur, we are looking for capital, but all the added value behind the money, what we call in English smart money, is also important. Look for investors who have knowledge of the industry in which you operate, who will open doors for you with potential suppliers or customers. You are on a mission to find the right partners. »

Put your team and your vision forward

A company is rarely the story of a single person. For financiers, it is important to observe the strengths of a team, which are the people in place, their skills and their complementary expertise. “We also talk about clearly defining your vision and explaining how you are going to execute it to meet your objectives, convert your ideas into a strategy. As investors, we think it’s better to have an excellent team in front of you with a decent product than to have a super good product with a bad team. We attach great importance to the people ahead of us and to their abilities. »

Demonstrate the added value and market of your product

Many entrepreneurs fall into the trap of describing their product too technically in front of investors. “We should rather focus on the benefits of this product and its distinctive value. Investors are more interested in these elements than in the technical characteristics of the product. What type of needs, what challenges does your product meet, what is its perceived value on the market? It’s more compelling than losing someone in technical language. You must also demonstrate the size of the market and how you will go about marketing your product. You could have the best product in the world, without a market you won’t be successful. »

Save your financial model for last

“When you meet investors, don’t start your presentation with the financial model. First talk about your team, your product and the potential market, before explaining how these elements will translate into a financial model. The story you tell should follow a logical course. Your financial model must be realistic and validated. If you are already in business, you will demonstrate a three or four year history and projections for the years to come. It is also beneficial to present options and possible scenarios, to demonstrate that you have agility and an ability to adapt. »