In an age where we’re spoilt for choice – even switching on the TV we have access to hundreds of channels – people are notoriously quick to make up their minds. If what’s in front of them doesn’t appeal immediately, they will move on.
The business world is no different. Psychologists believe it takes just seconds for investors to make up their minds about an opportunity when it’s presented to them in the room – and the big sell can be even tougher online.
For firms exploring digital asset marketplaces in particular, your business profile and accompanying offer is pivotal. It is the only thing that investors will see before making up their minds, so it needs to deliver immediate impact.
But rather than fearing the challenge, companies should seize the opportunity to stand out from the crowd and attract new investors. Putting a clear investment pitch together is actually easier than you think – if you include these three essentials:
1. The offer
The more you can excite potential investors, the greater results you will achieve. And this process starts by outlining who you are as a business.
Transparent information on your product or service, history, location and key milestones to date are vital for providing potential investors with good context. Remember, they are buying into the company as much as the opportunity, so they need to understand your ethos and credentials.
A strong company story should be followed by the fundraising pitch itself; why are you raising capital, what is it for, and how much do you need to raise? And then most importantly, what will they receive in return for their investment?
Be specific with this part of the pitch. Potential investors will want to know what type of digital asset you are offering, and how it will be hosted and managed, to make the opportunity tangible.
They will also be keen understand their exact entitlements as a shareholder. For example, will they receive voting rights? Will they get regular updates and communications from you? Anything to demonstrate the value they will get from investing in your company.
2. The criteria
Functionally speaking, a good investment pitch needs to be clear about the how, where and when for participants: when will the offer launch and close, what are the total number of shares on offer, and how can people get involved?
Potential investors will want to know the cost per share and whether they can purchase fractional shares if they are on a limited budget – or just want to dip their toe in the water initially.
In order to outline this information accurately, you will need to be confident on the value of your digital assets. As we discuss in our recent ebook, 8 things to consider before launch your own security token, this means completing a pre-money valuation of your company.
3. The investor
Finally, a good business pitch will explain who is eligible to invest in terms of their age, location and size of holding (both minimum and maximum contributions).
At this point in time you will have already decided whether to raise funds publicly or privately, and setting parameters is particularly important if you’re going down the retail investor route.
Geographical restrictions are particularly important in this scenario, as you want to focus on attracting investors within markets where digital asset offerings are regulated, and where you have the approval to raise capital.
Creating the perfect investment pitch
While the idea of creating a business profile and digital asset pitch may seem daunting, a good investment technology partner will support you through this process. Look for a fundraising platform that helps you to put an offer together and promote it successfully, in order to maximise the chances of reaching your initial target.
User-friendliness is a crucial part in choosing the right provider, which is why Own focused on creating an intuitive design and workflow when building our FAST Platform. Ultimately, the most impressive infrastructure in the world will be useless if you can’t attract the right investors; you need a partner that guides you through the process of launching new digital asset offers, in order to reach your financial goals.
For more advice on raising capital, download our free ebook: 8 things to consider when launching your own security token.