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What Do You Do When Investors Say ‘No’?

What Do You Do When Investors Say ‘No’?

Approaching an investor may not always go as expected. Even though you get everything right including a well-developed business plan and pitch, the result is unpredictable.

There is more to an investor rejecting your proposal other than them not being interested. Therefore, what should you do if an investor rejects your idea?

This article would explore the next steps to be taken when an investor says ‘no’:

  • Ask For Feedback

When an investor rejects your business proposal, politely ask for feedback. Getting to know the exact reason why your proposal was unfit for funding may help you improve. Finding out the investors’ expectations can also help lay the groundwork and incorporate factors into the proposal before approaching the next investor.

  • Go Though The Investment Proposal With A Fine-Tooth Comb

When the first two or three investors say ‘no’, then it could be thought of as a coincidence. However, when subsequent proposals face the same fate, it’s time you take a closer look at your investment proposal. Rather than rushing to the next investor with the same proposal, review the existing plan.

  • Rewrite Your Business Plan

A lot of hard work goes into building a business plan. However, there are times when investors can provide valuable feedback to add value to your venture. Therefore, before moving forward, you would have to modify your business plan. Sometimes, in order to make your venture more fundable, you would have to rewrite your plan and what you aim to do.

  • Do Your Market Research

The last step to take is to consider the business environment and do quite a bit of market research. See whether or not the industry is in a downturn. Do you find any issues with taxation or technological advances? There are a million reasons why investors could become wary of a particular business environment. Consider the rationality of the environment, and fix the business plan accordingly.

 

To conclude, a ‘no’ doesn’t simply mean that it is the end of your dreams. If one investor rejects your proposal, you can always approach another. Keep in mind that ‘no’ is a part of fundraising. Entrepreneurship is more than just an idea, it require patience, perseverance, hard work, and the ability to overcome failure.

Ajinkya Tanpure

ajinkya@asa.ventures

Mr Ajinkya Tanpure has a strong grip on the research and investment analysis for the group. Mr Tanpure believes in leveraging STEM skills towards a quantitative focused approach to finance and valuations. At ASA he handles valuations, pitchbooks, investment recommendations, due diligence research and identifies high potential investments hedged by quantifiable indicators such as market size, potential, and landscape.

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