How To Find Investors In India For Your Next Big Fund Raise

Starting your own business signals a lot of work. The biggest challenge that young entrepreneurs and startups in India face is the lack of adequate capital to make millions out of their brilliant ideas. According to a recent survey, nearly 94% of startups crash in their very first year. The primary reason for the cause is a shortfall of sufficient funds to get the business rolling. So the biggest dilemma that entrepreneurs face is  How to find investors for their business?

Businesses at all stages of operation need capital. The amount of funding, however, depends on the type and nature of your business. Remember that investors are only keen to invest their capital in ventures that have the potential to multiply their investment in a given period of time. Therefore your startup plan should be brilliant enough to turn the idea into a revenue-generating business. If you are looking for funding options, we have compiled a comprehensive guide to the various funding options in India and the ways to get your big fundraiser.

How To Find Investors In India

Securing investment is a crucial step for startups aiming to scale operations and achieve growth. For entrepreneurs in India, a diverse array of opportunities exists to connect with potential investors. Here’s a comprehensive guide on how to find investors in India for your next big fund raise:

1. Leverage Online Platforms

Online platforms are a convenient and efficient way to reach a broad network of investors:

• AngelList India: Create a detailed profile highlighting your business idea, market potential, and team. AngelList connects startups with a global network of angel investors and venture capitalists.
• LetsVenture: This platform facilitates fundraising by connecting startups with investors, and also provides support with compliance and due diligence.
• Tyke: Specializes in connecting startups with micro-investors for small but crucial funding rounds.

These platforms offer a straightforward way to pitch your business and secure initial funding.

2. Attend Startup Events and Conferences

Engaging in startup events and conferences can be a game-changer:

• Techsparks: Organized by YourStory, this event brings together a vast community of entrepreneurs, investors, and industry leaders.
• Startup India: A Government of India initiative that hosts numerous events and competitions aimed at fostering entrepreneurship.
• TiE Global Summit: Provides networking opportunities with seasoned entrepreneurs and potential investors.

Participating in these events allows you to network, gain insights, and present your pitch to a live audience of potential investors.

3. Utilize Social Media and Professional Networks

Social media platforms can be powerful tools for connecting with investors:

• LinkedIn: Join startup-focused groups, engage in discussions, and connect with investors. Sharing your business updates can attract the attention of potential investors.
• Twitter: Follow and interact with investors who are active in your industry. Use relevant hashtags to increase your visibility.

Professional networking on social media can lead to valuable connections and investment opportunities.

4. Approach Incubators and Accelerators

Incubators and accelerators provide not only funding but also mentorship, resources, and networking opportunities:

• Y Combinator: Though based in the US, it has a significant presence in India and offers extensive support for startups.
• 91springboard: Provides co-working spaces and a robust network of mentors and investors.
• T-Hub: Based in Hyderabad, it offers a comprehensive program for startups looking to scale.

These programs often culminate in demo days where startups pitch to a room full of investors, offering a direct route to potential funding.

5. Network Through Industry Associations

Industry associations can be a gateway to a network of investors:

• Indian Angel Network (IAN): One of the largest networks of angel investors in India. Becoming a member can provide access to numerous funding opportunities.
• Venture Catalysts: Offers a platform for startups to connect with early-stage investors.

Participating in these associations’ events can significantly enhance your visibility to potential investors.

7. Research Venture Capital Firms

Identify venture capital firms that align with your business model and stage:

• Sequoia Capital India: Known for investing in high-growth startups across various sectors.
• Accel Partners: Focuses on early-stage investments with a strong emphasis on technology-driven startups.
• Nexus Venture Partners: Invests in startups across multiple stages and sectors.

Study their investment criteria and portfolios, then reach out with a tailored pitch that aligns with their investment strategy.

8. Prepare a Compelling Pitch Deck

Your investor pitch deck should be clear, concise, and compelling:

• Problem and Solution: Clearly articulate the problem your startup solves and how your solution addresses it.
• Market Opportunity: Highlight the market size and growth potential.
• Business Model: Explain how your startup makes money.
• Traction: Showcase your achievements and milestones.
• Financial Projections: Provide realistic financial forecasts.
• Team: Introduce your team and their expertise.

A well-structured pitch deck can significantly enhance your chances of attracting investors.

10. Engage with Online Investor Communities

Join online communities and forums to network and gain insights:

• Startup India Hub: Provides resources, networking opportunities, and access to investors.
• YourStory: A platform that shares success stories and insights, and hosts events connecting startups with investors.

These communities offer valuable resources and connections that can help you find investors.

What are best investments options for startups in india

For startups in India, securing the right type of investment is crucial for growth and sustainability. Here are some of the best investment options for startups available:

Angel Investments for Startups

Angel investors are individuals willing to invest their money in small-scale startups and businesses. Such individuals are professionals from various walks of life, who have presently cashed out and help young entrepreneurs to live their dream.

Angel investors primarily invest in startups in their early stages and seek minimal stakes in the shares of the company. While a good return on investment is the key concern, angel investors are also motivated by the proposal. It is therefore important to ensure that your idea is thoroughly researched and validated.

As per the views of some of the leading angel investors in India, startups should only approach them when their MVP (Minimum Viable Product) and unit economics is ready. In order to pitch angel investors for your big fundraising, it is important that your products and services are unique, best and one-of-its-kind in the industry.

The probability of attracting investors is very high if your business is already functioning and you have to pay customers. Traction is very important. Angel investors are keener on making investments where their money is used for business expansion rather than fulfilling day-to-day operations. They will only invest in your startups if their money is used for customer acquisition and not just experimentation. Besides this, if your product is appealing to the masses, the target market size is big; angel investors will be more interested in investing.

Now you might ask, how to find investors who’ll invest in your idea at a very early stage? Start by looking in your own network! Friends and family should be your first target as it’s much easier to gain their trust given your long-term relationship with them. You can also reach out to other angel investors on social media platforms like LinkedIn. Start attending live startup pitches, B Plan competitions where you’ll find a panel of investors looking for the next big idea.

Venture Capital Investments for your startup

Venture capitals are funds that are professionally managed by financial wizards and ex-entrepreneurs who are recognized as General Partners (GPs). They generally invest their funds in small, emerging startups that exhibit high potential, thereby, guaranteeing a high amount of return in their investment. The investment is done in exchange for the equity and is a long-term investment, unlike angel investors.

Venture Capital firms never invest in businesses in their early stages or the later stages, when the competition gets high. Get a VC investment for your startup if your business is running and generating revenue.

VCs provide mentorship, expertise and in turn demand some control over managing business affairs. With a multitude of startups snapping for venture capital funding, you can only make them turn towards you if business showcases a strong team, good traction, and scalability in future.

Every VC fund will have a website with contact details clearly mentioned. But before you get excited, it’s important for you to do your homework. Most of the VCs have a sector inclination i.e. some invest in technology startups, some prefer consumer internet businesses while some invest only in specific domains. It is important to find a VC firm that invests in your line of business.

Bootstrapping your business

While angel investors and VCs are looked upon as the major source of investment for new startups, bootstrapping is another option you can consider. Bootstrapping is a form of self-funding your startup. Pitching up investors for their startup is a daunting task for first-time entrepreneurs.

Raising funds from your personal saving and asking contributions from family & friends can also generate investments to get your business kick-started. However, bootstrapping is a feasible option only if the initial capital requirement for your startup is small.

Crowdfunding

Crowdfunding, the latest model of funding, is a much sought after option by young entrepreneurs and startups. It involves taking up funds from a number of people who show interest in your product or services. In crowdfunding, the investors are not professional investors but common people willing to invest their surplus capital in startups.

In order to get crowdfunding, upload a detailed description of your business. Mention the investment amount required, goals and business plans for the future, on a crowdfunding platform. If the investors find your idea expedient enough, they will be more than willing to make the investment. Another advantage of crowdfunding is that it also helps to market your product, besides just generating funds.

There are a lot of crowdfunding websites like Kickstarter, Ketto, Indiegogo that you can always refer to if you are exploring crowdfunding as a medium to raise funds.

Getting funding for your startup is not easy. Hopefully, this post gave you the right approach and help you find the right investors for your new business enterprise.

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