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Searching for an investor and investments: where to find an investor? Investor proposals Find an investor to start a business from scratch.

The article was written by an experienced entrepreneur who has experience in attracting investments in his own innovative projects and third-party startups, collaborating with companies such as IC Finam, SBAR, Private Capital, etc.

First, a small but very important introduction:

Finding an investor willing to invest money in a new business is both simple and difficult. I’ll tell you how to find it below, but first I want to ask you: “Why do you want to attract an investor to your own business?”

No, I do not reject such an important and useful institute for a start-up business as “Investor”. In most cases, without an investor and attracting third-party money, a business simply cannot be created and launched.

I'm asking about something else:

“Are all your resources exhausted?”
“Does your business need an investor at all?”

Are you sure your project needs it? Do you think that an investor is pure “chocolate” and manna from heaven? Are you wrong?

To better understand these difficult issues, I suggest that you first and without fail read these articles:

Article: “Does a startup always need an investor with money?”
Article: “Investing in a startup, what problems might there be?”
Article: “Finding an investor for a startup or why does the investor say “no”?

Where to start looking for an investor for your business?

Do you need an investor to start a business, but you don’t know where to find one? Let's start with this.

First of all, I want to say the most correct and most banal thing: “To create a business, an investor can be found anywhere.” Everywhere. At every step. Even by extending your hand, you can feel the “strong shoulder of a friend” who can become an investor in your new project.

Therefore, for those who are looking for an investor for a start-up business, it is more important to understand not where to look, but how to look and, most importantly, how to convince a person or group of people to invest in your business.

Finding an investor is not a problem, the problem is making him a partner.

Below we will look at most of the possible “places” where you can and should look for an investor, and now I will try to focus your attention on one of the most important points - preparing to search for a future investor.

For many years now, there has been a story circulating on the Internet about how someone walked into an elevator and literally in two minutes, talking about his project, received almost millions of dollars from an investor.

I can fully admit that this is a true story. You never know how many poor and rich people wander around the world.

Perhaps someone fell for this. But in life everything is much more complicated and you won’t be able to find an investor “out of the box” without preparation.

To understand why, I will ask you: “Are you ready to give your hard-earned 25,000 rubles to a stranger. simply because he promises mountains of gold”? I think no.

You will study the offer, promises, etc. Why then do many of those who are looking for money for a project think that this money can be found without careful preparation?

In order to find serious money for a serious project, the minimum that you should have on hand is a business plan for the future project and its presentation with provisions on the benefits received by a possible investor.

A business plan can be replaced with a feasibility study (feasibility study), but it is better to have a full-fledged business plan. All the same, then the right investor will demand such a business plan in order to protect their money as much as possible.

Having read on Wikipedia and understood what a business angel is, an investment applicant can prepare (by creating a business plan and presentation) and contact directly the most serious organization in Russia that helps attract money from private investors to business - “SBAR” (Community of Business Angels of Russia) . There are other similar communities, but I advise you to contact them first.

The fact is that several years ago I promoted one of my inventions through SBAR.

Looking ahead, I want to say that my project never received the investments it needed.

But communication with representatives of SBAR, its managers preparing projects for the investment session and with those investors who were found with their help, “forever” cleared my brain regarding my innovation.

And understanding of innovative business in general.

Yes, I did not receive investment in the project with the help of SBAR, but the knowledge and experience that I gained by promoting the project with their help helped me get investment for another project quickly and comfortably. “There is no such thing as too much knowledge, just like money.”

By the way, I proposed my project to the National Network of Business Angels “Private Capital” in Moscow. There my project was immediately rejected. But I was not upset and continued the search.

This is what I wish for you: do not lose heart when rejected and continue searching for an investor.) In general, if you are rejected again, this does not mean that your project is bad. It may not be groundbreaking and won't change the world, but the harder you push it, the more likely you are to succeed.

Where and how to get money for a startup

This video explains: The legendary Russian Internet entrepreneur Anton Nosik shares his thoughts and best practices on how and where to look for your investors and how not to make a mistake.

Where to find investors for an online business?

Nowadays on the Internet you can often see advertisements like this: “Looking for an investor in a small business.” On message boards, special resources for aspiring entrepreneurs and innovators.

You can also take advantage of this opportunity and submit your ad. Perhaps this way you will find your investor, but the chances of success will be minimal. It is best to contact investors directly.

What do I mean when I say: targeted. This means that you need to prepare, collect a list of those Internet resources through which you can contact future and real investors.

Do you know why it is necessary to contact investors directly? I'll try to explain based on my own experience. Several years ago I decided to create my own extensive resource base where I could advertise for investment in a very interesting project.

I approached data collection with all responsibility and within a month I collected everything that could be found on the RuNet at that time. Including foreign investment funds. Rowing, as they say, everything that caught the eye and barely “moved.”

What was the result after I sent out my proposal to all these funds, communities, centers, technology parks, etc.?

Zero! Pure and virgin!

Russia and Ukraine is the first step to starting a successful business with an easy and simple start.

When making a decision to purchase a franchise, you need to consult the professional recommendations in this section:

You can read about the latest news and trends in franchise business

Do you know who I received “encouraging” replies and offers of investment from? From those who provided paid services for finding investments. Like: “You have a wonderful project, with our help you will change the world with your idea... but first we need to pay the Nth amount of money.” All clear?

Don't waste your time on such empty hassles. No, I do not deny that on such message boards, forums, etc. you can find your investor. This is possible, but the chances are slim.

Most of the “investors” on such resources are those who have no money, but want to foolishly scam you out of money. And they're getting scammed. And how they cheat!

Why am I talking all about sad things!

Look for money for a project on collective investment services. In my opinion, today the best crowdfunding platforms in Russia are the following resources:

boomstarter.ru
planeta.ru

If your business is created on an innovative idea, then I advise you to contact the Skolkovo Foundation https://community.sk.ru/news/ or Technopark "Strogino". These are state or near state structures, it is not easy to get into them, but it is possible.

An example of such a “hit” can be: Project Corteos and project "On Veliki".

Works productively in Russia Russian Startup Tour. This is the longest tour of the regions by leading experts from Russian development institutions with the participation of venture funds and major corporations. Perhaps your business or your innovation will be of interest to a large corporation, and it will provide it with investment?

I recently came across an offer from the creators of the City of Money service. City of Money is an online platform for loans for business and investment. I don’t want to give a link, I haven’t used it myself, find it and google it, but as stated on their website, this is a platform where investors and borrowers can contact each other directly, without intermediaries.

Well, the most likely thing is to take money from the bank. Either under a start-up business assistance program, for example from Sberbank, or in the form of a consumer loan. Many aspiring entrepreneurs started this way. They took money from the bank in the form of a consumer loan and started their own business. Many people succeeded.

The main thing is to find an investor

This video explains: An interview with the creator of the legendary Ozon online store, Alexander Egorov, in which he talks about the difficulties of finding investments and difficult relationships with investors that led to the sale of the business.

Investors for business in Moscow

Advertisements like: “Looking for investors to develop a business in Moscow” or: “Looking for an investor for a business in Ukraine”, in my opinion, are incorrect.

In the first case, it is not particularly important for the investor where the business created on a breakthrough technology or idea is located, and in the second, it makes no sense to look for an investor in Ukraine in our time (known political events). Which serious investor would invest money in a business operating in a country with a declining economy?

Let's focus on finding an investor in Moscow. I personally would not make any distinction in the geographic location of the investor, but if I did, I would turn to such resources as "Managers Club - E-executive." Do you know why? Yes, because 90% of the people shuffling there are managers from Moscow who have money.

Moreover, there are many managers with money who are already “ripe” for their own business. Do you understand? There is money, there is a desire to create a business, there is experience, but there is no time to fully devote oneself to a new business.

Not everyone is ready to leave the post of general manager of some oil company, even for the sake of their own business. Exit: find a head-first idea generator, invest money in him, his team and his idea, and everyone will be in chocolate.

This is educational: Strategy for startups

This video explains: A very interesting and original speech by Yuri Lifshits, which can be titled with humor: “A startup is not the whole life.” Yuri tells how to properly organize and build a startup strategy that will be key to your success.

An investor is looking for business projects and... does not find a suitable one

90% of new business creation projects do not receive investment because the business initiator is to blame. His main fault is that he either incorrectly emphasizes the business plan for the investor, or incorrectly creates the presentation of the project.

Here you need to understand the most important thing - how the investor considers applications.

In 95 cases out of 100, the investor sees only the main indicators provided by the project initiator:

whether he is satisfied with the financial performance of the project;
project payback period;
project risks;
and options for exiting the project.

The investor will read and consider the remaining indicators only when he is interested in the points that I listed above. Many people are still interested in having a project team, but this is not such an important point in my opinion. Or rather important, but later.

I will tell you how one of our projects was considered in IC "Finam". Looking ahead, I’ll say that my partner and I cheated a little when creating the presentation. Knowing in advance that we would be sending our presentation to Finam, we carefully prepared.

Having found out what projects this fund, respected in Russia, invests in, we found common “features” inherent in our project and those projects in which the fund has already invested. And these “traits” and features were especially emphasized in their presentation.

You can study the numerous experiences of other entrepreneurs who have created their own successful franchise business in the section of our website:

The most successful and informative case, according to the editors of the Russtarup portal:

An interesting experience of creating a business under a franchising program is presented

“Focus” passed, and we were invited to a conversation. Did we deceive the fund or not? No, of course not, we just did our presentation correctly. Did this help us in the end? No. Finam did not finance our project.

But we found investments elsewhere and from other investors, saying that our project received very good reviews in Finam.

Now let’s talk about how to draw up a business plan, an example of which will satisfy everyone. Or rather, about the small features of such a composition. So to speak: “A business plan for an investor, an example from my own life.”

What you write like: “The project will earn up to $100 million a year in two years” is of no particular interest to anyone. In my practice, any applications of this type are checked very quickly.

The main thing that needs to be emphasized in a business plan is to carefully and responsibly approach the creation of points:

what problems do the project solve for people?
project risks;
options for investor exit from the project.

When describing the risks of the project, you must clearly understand what risks your proposal may encounter during its implementation and in the future. Including competitive risks and risks called force majeure.

When describing options for an investor to exit a project, you must clearly write what you agree to in building a relationship with the investor. Here you need to understand the main thing - an investor investing in a project wants to make money. Make a profit. Explosive profits are desired.

All other motives that are important to you personally, for example, to create a unique business, to be the first in the industry, to prove something to your wife... the investor does not care at all.

Therefore, he must clearly understand how and when he will be able to sell his share in the business being created.

Greetings! Today, truly serious money comes only from business investments. Not only me, but also many honored experts in the field of finance think so.

So, investing in business projects: in what ways can this be done? And what are the pros and cons of each option?

There are several ways to invest in promising (in your opinion) business ideas. Let's look at them in order: from direct participation in the project to passive investments through a manager.

Method number 1. Create your own business

Owning your own business is the most profitable (potentially) way to invest in a business project. Direct investments can bring 10%, 100% and even 1000% per annum.

However, your own business requires maximum impact from its “creator.” And we’re not just talking about initial investments (although you can’t do without them). You will have to spend a lot of time, effort and nerves on your own business.

At the initial stage, you will play the role of an accountant and marketer, SEO and SMM specialist, designer and logistician. And this does not take into account the painstaking work on the main product, product or service on which you plan to earn money.

At the same time, the project will not begin to bring the first “dividends” immediately. And it’s not a fact that it will bring anything in principle. Owning your own business is not an investment, but an active way to earn money! True, the huge advantage of this method is that the potential profit from investments will belong to you and only you.

Method number 2. Share participation in business

This method of investing in projects is one of the most popular. Moreover, in Russia, and in Ukraine, and in Germany, and in the USA. Most large and successful companies were born through equity participation.

The advantages of this method: you can create a business without having large initial capital. In addition, responsibility for success (or failure) is distributed among several participants.

Cons: profits will have to be shared with partners. And as practice shows, in 90% of cases this leads to serious conflicts. Up to the resolution of disputes in court.

Method No. 3. Investments in startups

By investing in a completely new one, the investor claims a large part of the potential profit. The author of the idea, as a rule, is only involved in the implementation of the project and bringing the product to fruition. Moreover, the investor can be in Moscow, and the creator of the project can be in Minsk.

It is clear that investing in startups is buying a “pig in a poke.” The project may never break even. Or bring the investor a symbolic 5-10% per annum. Or “shoot” - and make the creators truly rich.

Everyone hopes for the latter option. But, unfortunately, examples of the Google and Facebook format appear much less frequently than one-day projects.

Easier and safer through specialized crowdfunding platforms. There, new advertisements undergo at least a minimum selection process. Plus, any proposals from investors and startups are considered on an individual basis.

On such platforms, an investor can receive income from investments in three ways:

Royalty (percentage of profit)
Repayment of the entire amount with interest after a predetermined period (public lending)
Obtaining a share in the company (equity crowdinvesting)

Method number 4. Investing in shares

A share is a security that gives an investor the right to own a tiny “piece” of a company. A small private owner cannot buy shares directly. But the intermediary broker provides access to the stock exchange to any adult from Yekaterinburg, Tver or Magadan.

There are two ways to make money on stocks:

Buy cheaper - sell more expensive (speculative option)
Receive dividends (passive option)

Buy by concluding an agreement, for example, with the broker FINAM? Yes, practically any that are traded on the market. The price of many shares is affordable even for the smallest investors. For example, an ordinary share of Gazprom at the beginning of July cost about 122 rubles, Sberbank - 149 rubles, Rostelecom - 71 rubles.

True, shares, as a rule, are not sold “piece by piece” - only in “packages”. In addition, do not forget about broker commissions. You will have to pay for intermediary services in any case. Even if you purchased the shares on the eve of the company's bankruptcy.

And one more nuance that is worth considering before forming a portfolio of securities. Stocks cannot be bought intuitively! An investor must know at least the basics of financial literacy in order to independently assess the prospects of a particular company.

Method No. 5. Investments in bonds

Bonds are also securities, but less risky than stocks. By purchasing a bond, you become a creditor for the company. Simply put, you lend her money at interest.

Does not give the investor the right to participate in the affairs of the company. The owner of a debt security does not claim a share of the profits. But he is guaranteed to get the money back on the maturity date (with a premium). And he will receive additional profit in the form of coupon income.

Method number 6. Investments in mutual funds

- the simplest, but also the most “indirect” way to invest money in a business.
Plus: You invest money in a ready-made portfolio of securities. For just a couple of thousand rubles you can buy a “piece” of 10-20 small and large companies.

Cons: you will have to pay a high commission to the manager. And you won’t be able to invest directly in one or two companies here.

What areas should you invest in in 2017?

Experts name several areas in demand in the coming years.

I will name the most interesting ones, in my opinion:

Health gadgets (we are talking about convenient applications that can be installed on a mobile device: pedometers, calorie counters, etc.)
Educational applications for children (there are very few quality products on the market that teach children something useful in a playful way)
Waste recycling (abroad, waste recycling is one of the most profitable areas in business. I believe that very soon they will understand this in Russia)

How do you usually invest in interesting business projects?

You have decided that you will develop your own business. Alone or in a team of like-minded people, you continuously improve your business idea, study the market, and look at possible competitors. And the moment inevitably comes when you understand what initial investment your project requires. Investments at the start may differ significantly, but in ninety-five percent of cases, a beginning businessman does not have the required amount of available funds. The way out of this situation is to find an investor for the business.

In this article we will talk about:

what preparation needs to be done before launching your project on the investment market;
where to find an investor;
how to interest an investor in your project;

consider forms of investment cooperation;
Let's talk about the mandatory clauses of the investment agreement;
let's be inspired by the experience of successful startups and look at their working ideas

So let's get started.

First, you must clearly understand your business idea and its accompanying business mission. If you yourself cannot formulate how exactly your future product or service differs from those existing on the market, do not expect that an investor will be interested in your idea.

Example of a bad business idea presentation: opening of a private kindergarten in one of the cities of the Moscow region.

An example of a good business idea presentation: opening a private kindergarten for 100 places in the village of Nakhabino, Moscow region, in order to satisfy the increased demand for kindergartens in the absence of supply.

Answer your questions honestly, preferably in writing.:

Why do I think that my future product/service is better than what is already on the market?
What target audience might it be of interest to?
How popular will my product/service be?
How do I plan to organize the production of goods/services? Here it would be appropriate to briefly describe the technological process.

At the meeting with you, the investor will ask these questions, so you must be 100% sure of the answers. Also, detailed answers to the questions described above will contain a business plan, with which you will go to the investor for a presentation of the project.

Second, you need a well-written, workable business plan. There is a lot of information on writing business plans both on the Internet and in specialized literature. You just need to study this issue and follow the recommended sections when writing. If you do not have the time or skills to write such documents, you can always turn to professionals for help. There is a huge selection of business plan writing services on the Internet. But!

A good business plan is not a beautifully written document or professionally presented information about the market and product. This is, first of all, a detailed description of your idea and evidence that the idea will be profitable. By the way, we talked about how to write a business plan in one of them.

Whether you write it yourself or delegate the writing of a business plan, you must know by heart and be confident in every proposal, and especially in the technological and financial part. Be prepared for the fact that every statement you make will be questioned by the investor.

Investors are primarily interested in:

The amount of investment you are applying for, as well as what share the investment will occupy in the total amount of capital investment in the project.
Profitable interest rate on investments. The rate on risk-free and low-risk investments (deposits, bonds, reliable shares) tends to 14-15% per annum, so you should offer a higher rate.
Payback period is the period in months during which the profits from the business will cover the initially incurred costs.
Project risks. The startup is a leader among risky capital investments. Write honestly about all the risks; experienced investors know about them anyway.

Indicators that must be present on the title page of the business plan:

Amount of investment.

Profitable interest rate.

Payback period.

If the investor is not satisfied with the above indicators, he will not look at the rest of the information. Put yourself in his shoes. He gives his money, earned with blood and sweat. What is he waiting for? Innovation? Social significance? ARRIVED. Everything else interests him insofar as. So give him a profit.

The third point in preparing for a meeting with an investor will be creating a presentation of your business project. Whether it will be a full-fledged presentation in Power Point, a printed album, or a set of sheets with key figures, tables, images is up to you. It all depends on the scale of the spartap and the requirements of the investor you contact. The main thing is your ability to convincingly present the project using prepared materials. Remember, the main thing is your prepared speech and charisma, and then a beautifully designed presentation. Get the investor interested, give him something to think about, and “infect” him with your idea.

When the preparation is completed, you can begin the search.

Where to find an investor?

Credit organizations

The most obvious solution for a novice businessman is to contact a bank. Many, many aspiring entrepreneurs took out so-called business development loans or even consumer loans and successfully developed their business. But banks want to invest money only in reliable projects and receive a good interest income.

If you choose this path of searching for investments, we recommend contacting a bank where you have an account and/or have a positive credit history. If there are none, contact large banks with a well-known name, avoid microfinance organizations.

A list of the most interesting business loan offers to date is given in the table.

Table 1. Business loans in Russian banks

Bank	Loan name	Sum	Term	Interest rate	Security
Banca Intesa	"Costs Down"	from 3 million rubles	1 year and 1 month - 10 years	from 12.5%	required
Ural FD	"Business Mortgage"	500 thousand rubles - 14.5 million rubles.	6 months - 10 years	13-13,5%	real estate
Severgazbank	"Modernization"	500 thousand rubles - 5 million rubles.	1-5 years	9,9-13,5%	required
Rosbank	"Commercial mortgage"	1 million rubles - 100 million rubles.	3 months - 7 years	12,22-13,76%	required

A list of interesting consumer loans is given in Table 2.

Table 2. Consumer loans that can be used as business investments.

Bank	Loan name	Sum	Term	Interest rate	Security
Sberbank of Russia	Consumer secured by real estate	up to 10 million rubles	up to 20 years	12,50%	required
VTB Bank of Moscow	Cash	up to 3 million rubles	up to 60 months	from 14.90%	Not required, proof of income required
Housing Finance Bank	Universal	up to 8 million rubles	up to 20 years	12,89%	required
Gazprombank	Secured by real estate	up to 30 million rubles	up to 15 years	12,70%	required

Pros: high probability of receiving funds if all documents and security are provided, transparent and verified scheme for raising funds.

Minuses: high interest rate, security and confirmation of income, guarantees of third parties or organizations are almost always required.

Private investors, business angels, crowdinvesting

If the option of going to the bank seems too “expensive” to you (and it is), or you do not want to provide the bank with your apartment as collateral, you should take a closer look at private investors and the so-called “business angels”. Private investors are most often people who have already earned enough money from their business. And now they invest it in other businesses and receive passive income. In addition to investments, business angels provide expert support to young businesses, can introduce you to certain business circles, advise working business models, and suggest ways to optimize your business.

Type the words “private investor” and “business angel” into a search engine and you will find more than a million offers from potential investors. Among the proposals there will be investment exchanges, the most famous of which are:

start2up
EASTWESTGROUP
investorov.net
business-platform
SBAR (Russian business angel community)

However, do not create vain illusions that by placing an ad describing your project, you will receive hundreds of offers from potential investors. You will have to write letters and call yourself, and more than once. After sending a hundred applications, you may receive only three to five responses. .

Beware of scammers, of which there are a sufficient number on the Internet. Never deposit money for anything, under any pretext. And read the contract carefully.

Register on forums for professional communication of TOP managers, such as E-xecutive and Up-pro. Reputable employees of large companies communicate on them. They have free financial resources, but no time to develop their own business. A good opportunity for you to express yourself.

Another interesting subtype of private investment is crowdfunding and crowdinvesting projects.

The term " crowdfunding" comes from the English words "crowd" - crowd and "funding" - financing, provision. It is clear that we are talking about collective fundraising for a project. This can be either a commercial endeavor or a charity event. Crowdinvesting- This is also a collective fundraiser, but Spartapas and commercial ventures are already becoming the object of investment. Investors expect profit from such investments.

Crowdfunding is an interesting option for an interesting idea

Both types are relatively new in the world of investing and dynamically developing. True, to successfully search for a group of unrelated investors on the Internet, your project must be either very bright or very modern and trendy. The proposal should “catch” the eye. High technology, IT, projects with a social impact, with a creative component, etc. are suitable. And you are unlikely to receive large investments (more than 1 million rubles), since mainly young beginning investors with a share of adventurism, but without large funds, register on such sites.

Take a look at Russian crowdfunding sites:

Planeta.ru;
BoomStarter;
Simex;
Crowdsourcing.ru.

It is worth noting that your relatives and friends may also turn out to be investors for your project. But you shouldn’t take such investments carelessly. Make preliminary preparations for a meeting with a loved one in the same way as if you were presenting a project to an unfamiliar investor.

Pros: private investors require fewer documents and often provide money without collateral; they can help a business with experience and connections; for small, ambitious projects, investments are found quickly.

Minuses: the target income interest rate is often higher than in banks, the risk of falling for scammers is high.

Video - Attracting investments

In this video, Oleg Karnaukh, founder of the Smart Business project, says:

at what stage does a small business need investment,
what arguments to get for a conversation with an investor
how to remain the owner of your business
how to scale a business.

Investment venture funds

Let's move on to the most difficult, but also the most interesting ways to attract investment.

First, let’s define what a “venture fund” is.

Venture fund comes from the English word “venture” - an adventure, a bold undertaking, a risky undertaking. Such funds invest money with a high degree of risk, but also with great profit. 80% of venture capital investments depreciate in value, but 20% bring such a profit that it is several times higher than the costs.

If your future business does not relate to:

high-tech sector,
IT and telecommunications,
healthcare,
Internet and e-commerce,

You can safely skip this paragraph of the article and move on to the next one.

For the remaining ones, we reveal the work scheme of venture funds. The fund's team consists of experienced financiers who deal primarily with high-risk investments. All applications go through several stages of consideration.

Stage 1. Review of submitted applications. The business plan and other documents are checked for correctness of writing, compliance with the fund’s policies, and profitability. 90% of applications do not pass this stage.

Stage 2. Conducting research in the field of competitiveness of a new product, financial efficiency of a future business, and management competence. 9% of applications do not pass this stage.

Stage 3. Negotiating and concluding a contract. 1% of those who apply become the owners of the required amount for business development.

We recommend applying to venture funds and taking an active interest in new venture projects. Even if your application is rejected at the first stage, this is not a reason to stop, but an opportunity to analyze your mistakes and submit the documents again. In fact, this is a free master class on attracting investments from experienced investors.

Table 3 lists the largest venture funds operating in Russia.

Table 3. Large Russian venture funds

Fund name	Investment area	Average investment amounts	Expected share in the company
Runa Capital	IT, mobile technologies	$3 million	20 - 40%
ABRT	Technological projects, internet	From $1 million	30 - 35%
e.ventures	IT, internet	Up to $10 million	30 - 35%
RVC (Seed Investment Fund)	Science and technology, precision technologies	Not defined, investments only with a partner	25%
Russian Ventures	Internet, services	$35 – 500 thousand	15-20%

You must understand that if you want to make a profit from your project, then it must at least bring 40-45% profitability, because you will give 30-35% to the vendor. Are you ready for this challenge?

Pros: the ability to find funds at the initial stage, without collateral; The very concept of venture investment implies that the investor may lose money if the project fails.

Minuses: not suitable for all projects, long and complex competition for obtaining funds, high investor share in the company.

Video – Conference of the Foundation for the Development of Innovation and Initiatives

After watching this video, you will learn how to bring an IT startup to the international venture capital market. And also how, where and at what rate to ask for money for innovation

Grants and subsidies

The most desirable type of attracting investment for any beginning businessman is, of course, a grant or subsidy. After all, you don’t have to give them away! Or it is necessary, but after a certain period and without interest. Therefore, those wishing to receive such financial assistance from outside are a dime a dozen. However, in order to qualify for a grant or subsidy, your business project must bring not only profit to you, but also benefit to society. Only projects with a social impact receive the attention of non-profit foundations.

Funds that provide support to new and small businesses are divided into state and non-state.

Target areas subsidized by government grants:

Agriculture;
Innovative technologies;
Education;
Advertising and Marketing;
Tourism;
Healthcare;
Production of goods for export.

Non-state funds subsidize the following industries:

Agriculture;
Innovative production;
IT and telecommunications;
Internet trading;
Healthcare;
Social business;
Creation.

Let's look at the most interesting measures of state and non-state support for small and new businesses.

Pros: Grants received do not need to be repaid; subsidies are given either on a non-refundable basis or without interest.

Minuses: This type of financing is not available for all projects; you will need to regularly report for the money received.

The investor has invited you to a meeting. What's next?

Armed with a business plan and project presentation, you rush to negotiations. At this stage, the main task for you is to talk about your business idea as convincingly as possible. And sell it for as much as possible.

Meeting with an investor is the most important step

Yes, yes, that's not a typo. During negotiations, you sell your business idea and your efforts to implement it, and in exchange you receive money at a rate of return that suits both you and the investor.

Negotiations are by no means a friendly meeting, but a kind of battle with an investor for future profits, so remember a few important rules.

If possible, carefully study the bank, fund or person you are approaching for money. What businesses does he invest in? How does he feel about risk in investing? What goals does he pursue? Use the information received in negotiations
Always focus on the benefit for the investor, not on your financial goals
Prepare a rough structure for the meeting and think through answers to possible questions.
During negotiations, write down all the key points, otherwise important information may simply fall out of your attention later.
Be flexible, consider investor offers
At the end of the meeting, write down all agreements reached. Prepare supporting documents together.

One of the important topics of negotiations with an investor will be the choice of investment form. There are two such forms for small businesses: lending and buying out a share in the business. Let us consider in Table 4 the comparative characteristics of the two forms and determine the pros and cons of each of them.

Table 4. Characteristics of various forms of investment

Indicators	Lending	Buying out a share in a business
Return on investment	Need to return	No need to return
Revenue part	Interest on the amount of debt	Percentage of business profit
Own	You remain completely the owner of the business	Part of the business becomes the property of the investor
Making decisions	The lender does not influence your decisions	The investor influences decision making, the level of influence is determined by the investor’s share in the business
Risks	In case of business insolvency, the creditor bears no or minimal risks	The investor bears the risks together with you in proportion to the share in the business
pros	You remain the owner of your business and can, after repaying the loan, take all the profit earned for yourself	You share responsibility for the success of the business with the investor. No profit - no payments to the investor
Minuses	If the business experiences financial problems, the loan will need to be repaid first	Any more or less important decision must be discussed with the investor

The final stage of negotiations with a potential investor will be the conclusion of an investment agreement. Most often, you will be offered an agreement developed by the investor and, accordingly, focused on his interests.

Read all clauses of the contract carefully and ask clarifying questions. Feel free to make corrections. It’s better to show the contract to a lawyer to avoid pitfalls.

Video - Master class on finding investments

Look at the secrets of finding a development investor from Sergei Gribov. At the master class, he explains the entire practice of obtaining investments, based on his fifteen years of experience in creating startups in countries such as Israel, America and Russia.

Who did it?

Yes, attracting investment in a young, growing business is not easy. Yes, in exchange for the funds received, you will have to give away part of the future profit. But who will stop it?

See how inexperienced aspiring businessmen like you achieved success. Do you see any familiar companies among them?

Max Levchin, company founder PayPal, attended Champaign College with a degree in communications security. He never even thought about creating a world-famous online payment system, but while still in college, he became the founder of three companies in the field of information technology. True, none of them achieved success. Then he had such a bright business idea that he dropped out of school and moved to Silicon Valley to bring it to life in the most suitable place for this.

PayPal is a well-known payment system that developed thanks to a well-formulated idea

In the summer of 1998, he was living in a friend's apartment in Silicon Valley, without funds, without certain prospects. One day Levchin went to a lecture at Stanford University. Peter Thiel was reading it, and Levchin wanted to take a look at the man about whom he had heard so much. After the speech, Max approached him to tell him about his idea and ask for expert advice. Til listened to the young man with interest and invited him to a business breakfast.

Levchin described his idea to Til, and he offered to implement it by investing some money. It turned out that Peter Thiel ran a hedge fund.

Yahoo! began as a site where two Stanford University graduate students, David Filo and Jerry Yang, collected web links to documents on various topics. Passionate about their idea, the students added new links to the catalog every day, and soon the catalog website became popular. At the end of 1994, Young and Philo decided to create a commercial organization for their website and asked Tim Brady to write a business plan. Brady was in his senior year at the time and therefore turned the business plan into Yahoo! graduation project.

At the 1995 San Jose Electronics Show, Yahoo! placed its stand. There was not a single Internet project among the event participants, so the Yahoo! investors noticed. A few weeks after the exhibition, the students found funding for their company and moved into a real office (they had previously worked in a trailer on the institute's campus). The venture fund Sequoia Capital acted as an investor and managed to receive $1 million as an initial investment

But this is America, you say. Such ideas are born there, such capital circulates there, you say. And you will be wrong. Here are examples from Russian reality.

The founders of a large online labor exchange, Denis Kutergin and Alexey Gidirim, worked for a long time without funding, seeking their own funds. The breakthrough came in December 2010, when YouDo entered the top ten Internet projects of the Web Ready competition. Within a few months after this, the company was assigned an investment attractiveness index of “A” in the StartupIndex rating. In 2013, she won a competition announced by the Pavel Durov and Yuri Milner Foundation and received $1 million for development.

In 2016, Alexey Moiseenkov, an employee of My.com (a subsidiary of the famous Mail.Ru Group) developed an application for smartphones Prisma, allowing ordinary users to create photographs in the style of Van Gogh, Munch, Marc Chagall and other famous artists. Alexey skillfully found funding for his project. He showed the idea to the Deputy General Director of Mail.Ru Group, who became interested in the project and introduced Alexey to the founders of the Gagarin Capital fund and private investors. Today Moiseenkov is a dollar millionaire. Prisma is not Alexey’s first startup; before becoming a successful startuper, he managed to hit a lot of bad points for himself.

Prisma - an application for creating a picture from a photograph using neural networks

As you can see, it is quite possible to get investment, but it requires persistence. And a little luck.

Conclusion

In conclusion, we note that you do not have to concentrate on any one way to attract money to your business. You are a generator of business ideas, so be creative to the end! You can, for example, receive a subsidy for business development from the state, become a resident of one of the business incubators, invest your funds and attract friends, making them business partners, and make up for the lack of funds with a bank loan. And this is just one of the options.

Take action, don't give up and may the force be with you.

Step-by-step instructions and pitfalls

Finding an investor: where to start?

Anna Sokolova

We have already made detailed selections about where to go for a startup with a bare idea and where to get money for business in various niches, but this did not stop the flow of questions from newcomers. This time we have combined Rusbase training materials into a single logical chain to guide even beginners.

Where to start looking for investments? People who ask us this question are usually at the idea stage. To attract investment, they will have to go through a long and labor-intensive journey: thoroughly develop an idea, study competitors, assemble a team, create a working prototype of a product, make a competent presentation, register in online services to find an investor, upgrade to an accelerator, participate in competitions, make acquaintances at events, find potential investors and write them a lot of letters, read the specialized press and try to get on its pages.

Some points here are optional, some people do without them, but the general algorithm is as follows. Passing it in itself does not guarantee attracting investments - it all depends on you and your product. But without a presentation and understanding of the investment market, you definitely won’t see it.

What to do with the idea?

Work it out! Your brilliant idea is worthless until it starts attracting an audience and making money. Without a working prototype and a team, investors won’t even listen to you - unless, of course, you are already known in the market as a successful serial entrepreneur. By investing in an idea, an investor risks not only money, but also his reputation. To prove your ability to run a business, you need to independently find at least the minimum resources to create a product.

Often, startupers are afraid to tell experts about their brilliant idea, thinking that it will be stolen. In fact, an idea is worthless until it is implemented. This simple truth is reflected in the fifth paragraph of Article 1259 of the Civil Code of the Russian Federation: copyright does not apply to ideas, concepts, principles, methods, processes, systems, methods, solutions to technical, organizational or other problems, discoveries, facts, programming languages. You can secure intellectual rights only for technology, unique design and software. Learn more about your copyright protection options.

Moreover, the idea almost always turns out to be not new if you thoroughly study the market. Even if the product is unique, you can usually find substitute products, albeit with different properties. An investor will never believe that you have no competitors at all. He will think that you haven’t probed the waters well and that you shouldn’t be given money.

Before you approach venture capitalists, you need to understand the difference between a startup and a small business. In the public consciousness, the word “startup” often means the initial stage of business development. In fact, this is a special type of enterprise that implies product innovation, global ambitions and rapid growth. If you want to open a traditional business (for example, an atelier or a flower stall), then you will have different investors and a different strategy. Venture investors still prefer projects related to IT and innovation.

Where to look for a team?

To get even a fraction of an investor's attention, you need a working prototype and a team. It’s difficult to create a product alone, so you need to try to infect someone else with your idea.

Experienced entrepreneurs advise attracting like-minded people at startup events. Especially at hackathons, where you can see a person in action. You can search for competent co-founders using special services - for example, on the website CoFoundIt.ru, which recently launched IIDF (the base is formed from accelerator graduates). You can also always make inquiries from friends or call out on social networks, but in this case there is less chance of snagging an experienced specialist.

More information about team formation can be found here:

If you already have an MVP

A working prototype is not like a landing page with empty forms. At the investment search stage, it should already be tested by potential clients. You also need to come up with and be able to clearly explain a business model - how you will earn money per unit of product.

If theoretical knowledge did not help you understand the idea, MVP and monetization strategy, you can turn to product development specialists. For example, this is done by the company Create, whose services will cost you from 150 thousand to 1 million rubles, depending on the amount of work.

Well, if you have a working prototype, you can start looking for an investor. To do this, you will need a thoughtful, compelling presentation that will become the basis for your pitch.

But before you dive into the intricacies of creating perfect slides, you should think hard: do you really need an investor? It is important to understand that investment is not a panacea. Business is not built on them, but on customers and sales. If this is not the case, then no investor will help you. It is best to attract investments to increase sales, because the essence of a startup is rapid growth. If you develop well, investors will come to you themselves, you’ll see.

So sometimes you just don't need an investor. Some startupers generally manage to develop a company only with their own money - this is called bootstrapping, which translates from English as belt-tightening. And this approach has a lot of advantages - for example, complete freedom of decision-making and serious development of entrepreneurial skills.

In addition, there are hundreds of free or cheap services on the Internet that will save you money, effort and time when solving various business problems.

How to make a presentation for a startup?

Investors are doomed to watch hundreds of presentations a year - respect their time. The presentation should be concise and well-structured, that is, contain visual information about the team, product, market, audience, business model and capitalization.

Read about the rules for creating a successful presentation here:

If you still can't combine these tips and our free templates into a high-quality presentation, you can.

But beautiful and clear slides alone are not enough for investors - they want to hear about money and their profits. To prepare for tricky questions in advance, first read these materials:

Search for investments through startup databases

When you already have a product and clear outlines of the project (which are outlined in the presentation), you can register with online investment search services. Investors are looking for projects there in the niches they need. Posting in startup databases is usually free, but projects undergo moderation, the severity of which depends on the resource’s policy.

Rusbase Pipeline adds startups only if there is a working prototype and signs of demand (we currently have about 350 projects in our database), investors - only if they are ready to invest at least $50 thousand in one project (their list exceeds 200 names).
StartTrack is a crowdinvesting platform from IIDF that helps investors enter into joint deals. A startup needs to pay a commission to attract investments. There are currently 725 investors and 37 projects in the StartTrack database. This ratio hints that the site’s requirements for startups are quite high.
Spark is a service for finding an investor who has retrained as a technology project crowd (similar to Habr), where you can share experiences and post vacancies. There are 4249 projects in the database, 1329 of which are seeking investment.
Napartner is one of the first startup exchanges on the Russian market. As indicated on the website, there are 1,139 registered investors, 9,892 “innovators” and 456 projects seeking investment. There is also a section for selling ready-made businesses and a vacancies section.
Askcap is perhaps the largest Russian startup database. According to the project’s own information, the site contains profiles of 5,410 projects, most of which are available only to authorized users. 163 partners work with Askcap - venture funds, incubators, accelerators and technology parks.
AngelList is the world's leading service for finding startups and investments, which has spawned many clones (ours are listed above). Its database includes 1,589 startups and 378 investors from Russia. AngelList provides opportunities for co-investment in projects, posting vacancies and resumes.

Participation in competitions and other events

Competitions help to gain valuable competitive experience, and if you win, a grant and the attention of investors (including through reporting publications in the media). In Russia and abroad, competitions, hackathons and free educational programs for startupers are regularly organized - it is convenient to follow this flow of opportunities with our tag.

It can also be helpful to go to industry events, especially if you're new to the venture scene. There you can listen to successful technology entrepreneurs, meet potential investors, catch the main trends, talk about your project and get feedback. Of course, moderation is needed in everything - connections and parties alone cannot promote a project. We collect the main events of the startup industry in the “Entrepreneur Calendar” section.

Active search for an investor

If you haven’t found an investor at events, you can try writing to venture funds. Try it - because cold and warm contacts do not work well in such matters, the most effective means has always been and will be personal acquaintance.

Before writing a letter to an investor, it is critical to make sure that your project matches their preferences. Funds usually indicate on their websites what niches and stages of startups they are interested in. If not, then you can still guess about it from the list of portfolio companies (which should be studied in any case). To compile a list of funds to which you can send your project for consideration, you can use our database of investors - there are convenient filters by niche and stage.

What to write to an investor? Before you sit down to write, you need to carefully study the foundation’s website. Fan mailings to investors never worked. Also, under no circumstances should you write from someone else’s mailbox. In order not to be left without an answer, you need to accurately formulate the subject of the letter, adequately introduce yourself and the project (and yes, ask a literate friend to proofread the text for errors) and explain why your startup is relevant to the fund (for example, it is similar to or complements one of the portfolio projects). If the letter consists only of a link to the attached presentation, it simply will not be opened.

Why go to accelerators?

Accelerators are intensive, full-time educational programs (usually lasting several months) that help early-stage projects grow to the point of receiving their first investment. This is a great option for those who can’t find an investor themselves.

Accelerators usually charge 3–7% of the company for their services, so they are interested in finding investors for them in order to recoup their costs with a successful exit. There are enough accelerators in Russia; to choose the optimal one, you need to look at its requirements by stage and niche, as well as the fate of graduates.

The most active on the market are:

The IIDF accelerator selects experienced teams of at least 2 people, with a legal entity, a business model, a market volume of at least $10 million and the possibility of monetization during acceleration. The list of graduates can be viewed.
Here .

Startup PR in the media

To better understand the market, it’s definitely worth subscribing to thematic media - Rusbase, vc.ru, Firrma, Roem and “Secret of the Firm”. When you thoroughly understand their headings and formats, you can try to get on the pages of these media. When implemented correctly, this is a good way to attract the attention of investors and audiences.

But there are also pitfalls - for example, you shouldn’t go into the press with a raw product or a lack of competence (readers will immediately notice this). But when you grow up, journalists will come to you themselves (like investors).

Read about how to reach a journalist and not get into trouble here:

Just please don’t forget that no amount of PR or investment can replace your business with a quality product that people need.

This section is for those who are either ready to invest and are looking for an object for profitable investment, or, on the contrary, are interested in attracting Russian or foreign capital. Here you can find advertisements from private investors who are ready to invest money in business, as well as investment programs of investor companies offering, among other things, project financing. Direct and venture investment funds, major regional and industrial investors are invited to contribute to this section. Both small and large businesses will find a wide range of investment opportunities here.

It doesn’t matter who you are: a private equity fund, a venture fund, a private investor, a business angel, an investment bank or a management company, if you make direct investments and are ready to provide project financing, then this portal will be useful to you.

If you are interested in diversifying your investment portfolio, looking for new and profitable objects for investment, post information about yourself: investment priorities, volumes and directions of investment, principles for selecting investment projects and companies, ways to exit an investment project.

You can not only post information about yourself, but also subscribe to receive applications to attract investments. Just customize the search form in accordance with the criteria you are interested in and regularly receive investment applications in your mailbox. Do you want to be more active in your search for investment targets? Then refer to the section "Investment projects".