When seeking financing for your business, you may encounter gatekeepers. Gatekeepers are advisors who work for institutional investors. If an institutional investor has little or no experience, he or she may partner with a gatekeeper. The gatekeeper will offer advice regarding which businesses are worth investing in and which ones aren’t. While you can always avoid them, there are ways to deal with gatekeepers.
5 Tips on Dealing With Gatekeepers
#1) Search for Prior Investments
You may want to search for a gatekeeper’s prior investments. Gatekeepers are advisors for institutional investors, but many of them have conducted their own investments in the past. Some gatekeepers have run their own private equity or venture capital firms, for instance, and others have been angel investors. By searching for a gatekeeper’s prior investments, you can determine whether your business is a good fit.
#2) Talk Fast
As financial advisors, gatekeepers are busy people. They must research businesses, negotiate deals and offer recommendations to the institutional investors for which they work. With their busy workdays, they don’t have a lot of time to spend on the phone. You can still call gatekeepers to pitch your business, but you’ll need to talk fast. Time is of the essence when communicating with the gatekeepers.
#3) Provide Projections
After getting a gatekeeper on the phone, you should provide him or her with financial projections of your business. Financial projections will allow the gatekeeper to determine whether your business is worth investing in. As a result, it can help you secure financing. Failure to provide financial projections, on the other hand, will leave the gatekeeper questioning your business’s future profitability.
#4) Overcome Objections
Objections are inevitable when seeking financing. Some institutional investors, as well as gatekeepers, may reject your offer for equity financing. The good news is that you may be able to overcome some of these objections. If a gatekeeper believes your business’s valuation is too high, for example, you can lower it. Offering the gatekeeper a bigger piece of your business at a lower price may persuade him or her to invest in your business.
#5) Contact Institutional Investors Directly
If possible, try to contact institutional investors directly. Gatekeepers stand in the way of the institutional investors for which they work. If you call an investor’s office, the gatekeeper may answer the phone. Institutional investors, though, often have a direct phone number. You can call them directly to bypass their respective gatekeepers.
This article was brought to you by Intrepid Private Capital Group, a Global Financial Services Company. For more information on startup and business funding, or to complete a funding application, please visit our website.
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