What’s Your Story? Getting Investors Interested in Your Cleantech Startup
There’s no better time to grow your market share and build loyalty among consumers. Your green tech business has really started to demonstrate an impact on your community. People are talking about how balanced and layered your business practices and strategies are. You’re environmentally conscious, catering to an engaged audience, and pragmatic about your future goals. It’s time to engage in some serious fundraising.
What works with acquiring and keeping new investors?
No one said raising money for a cleantech startup was easy, but learning about the different methods of fundraising can make the task a little easier. People give because they believe that what your cleantech startup is doing is worth it. They believe you can get it done and that their support will make a real difference.
People who contribute to cleantech startups can designate funds to worthy businesses in a multitude of ways. But what makes them want to invest? You’ve got to tell a compelling story.
Fundraising Means Telling a Story Like Nobody Else’s
Usually, startups organizations reach out to individual investors through direct appeals, newsletters, social networking, and special events. Regardless of the medium, your request for investment should contain a story. Stories convey emotion, stimulate the imagination, and move us to action.
Humans love a story. Stories get retold, as they’re enduring. Stories reveal our hidden talents or suppressed memories, all waiting to be exposed.
We remember stories. As writer and journalist Joan Didion said, “We tell ourselves stories in order to live.” The same is true with potential investors. Stories inspire us, rekindle our enthusiasm in a cynical world — and, within business, make us want to live vicariously through the experience captured within the conflict and resolution that your story contains.
Most cleantech startups don’t consider the importance of telling a great story to investors when they’re first looking for an injection of funds. Instead, they jump right into an overview of what they’re designing, a list of anticipated costs, methods for marketing and distribution, and potential return on investment (ROI).
Sure, each of these is essential to a fully-realized business plan, but, if you demonstrate to investors that you care and so should they, then your pitch is much less likely to be placed in a pile of others, someday to be recycled without much consideration.
A story separates your cleantech startup from others who are also seeking investment. Your story must be so special and poignant that it makes you stand out from the others and communicate your business ideas better through a powerful allure. Carefully craft your story so that it points your potential investors to what it is they will be providing with their endorsement of your cleantech startup.
What a Story Accomplishes for Your Investors
A story is a preview for your investors. It is a type of Origin Tale that embodies your epiphany and your team’s motivation. It’s a way for you to encapsulate what is soon to become your brand. The story has many purposes.
- It examines how your product was conceived. It reveals a raw, unfiltered self that you once were. Now you’ve evolved, of course, and, because your story contains a sense of brutal honesty and self-awareness, it makes what could otherwise be the sterile, abstract concept of your cleantech startup become real and tangible to your investor audience.
- In the revelation within your story, you’ve implicitly told your investors that you have the potential to establish a permanent and lasting place in the cleantech industry.
- The theme within your story is influential enough for your field of investors to provide you funding to turn your business idea into reality.
- You clearly are offering a new and different approach that excites potential investors, as nobody else is as imaginative and creative as you are.
- Your story introduces your business ideas to investors.
- It’s an entree to facts and statistics that describe your product and the industry that frames it.
While it’s generally best to focus on the positive, a note or two about what not to do is always helpful. Don’t feel obliged to tell too long a story; being succinct and pointed is the hallmark of a good storyteller. There’s no need to perseverate, dragging on with tangents and unnecessary details. Doing so will diminish your overall message and extinguish their interest.
Looking for Major Gift Development? Put the Personal in the Asking
Carefully craft your message so that it tells your investors what it is they will be providing with their endorsement of your cleantech startup. The most common methods of attracting gifts from major donors include gala events, luxury auctions, planning special tours, and trips. David Allen, a fundraising consultant for conservation groups, offers a step-by-step process to fundraising pitches.
Major investments, he says, are built around a guiding set of principles, and these translate well to the development goals for cleantech startups.
- Cultivation: Put the human in your fiscal picture. Investment is about personal connections between your cleantech startup’s organizational leaders and your donors.
- Redundancy: Prospects should know more than one administrator/staff. That means spreading out the responsibility for getting investment among several people at your place.
- Past Performance Isn’t Necessarily Future Investment: Investor prospects are selected based on financial capacity and inclination, not necessarily on past giving. This means you need to do your homework, which involves research and thoughtfulness. Who’s expressed an interest? Who has seemed intrigued recently by your business? Who lingered longer than others at the recent conference where you showcased your ideas?
- The Who’s Who: For each major and prospective investor, maintain a three-year cultivation plan and a series of immediate next steps that you have completed and intend to take to obtain and retain the investor’s interest and — hopefully — ongoing support.
- Profile Records: The relationship each donor has with the organization is recorded on a profile sheet. Each profile includes a photograph and is permanently filed, with a cultivation plan, as part of consistent and important record-keeping and revisiting strategy during semi-annual business plan assessments.
Learning to effectively tell your story to attract investors will move your cleantech startup to a new level of fiscal stability. The essence to a cleantech startup story is that it appeals to your expanding list of customers as well as crowdsourcing, angel, and venture investors. Those are topics of upcoming fundraising articles for Ecopreneurist. Keep checking back!