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6 Steps to Finding the Right Investors for Your Business

Are you an entrepreneur looking for the right investors to grow your business? Follow this proven formula to get the resources you need to succeed — on your own terms.

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We've all heard funding horror stories — a passionate founder finally reaches their funding goal only to lose control, be forced to abandon their values and eventually get kicked out of their own business. It happens — but it doesn't have to happen to you. Raising funding from the right investors on the right terms takes time and effort, but it's among the most critical things you will do as a business owner.

Using the right strategy, owners of diverse small businesses, from start-up cafes to high-growth tech companies, can and do find values-aligned investors. These relationships deliver lifelong benefits to all stakeholders — business owners, investors, customers, suppliers, the community and the environment. With the steps outlined below, you can find the right investors and avoid wasting time on unproductive and demoralizing fundraising strategies.

Related: Is Bank or Investor Funding Right For Your Business?

Step 1: Clarify your goals and values

Sometimes business owners get so busy with daily tasks we don't take the time to get clear on the big picture. Before any investor exploration, ask and answer some key questions. Remember why you started your business in the first place: What is its purpose, what impacts will it have and where is it going? Your answers will clarify your vision and values, making communicating with you easier and inspiring investors to join you on your journey. More importantly, you will have greater success connecting with the right investors — those who align with your goals and values — and avoid wasting precious time on unproductive conversations with the wrong investors.

One more important thing to get clear on before moving ahead: What are your non-negotiables? These are your values or needs that aren't up for discussion. The right investor won't ask you to sacrifice your non-negotiables. Creating boundaries around what issues are and are not open for discussion will help prepare you for conversations with those in a position to help you achieve your goals.

Remember, it is better not to raise money at all than to raise money that forces you to compromise on what's important to you and why you started your business in the first place. Taking time to get clear on your goals and values will help you design a fundraising strategy that is perfectly aligned with what you want.

Related: 5 Questions Every Entrepreneur Should Ask Potential Investors

Step 2: Identify the right investors

Finding and meeting potential investors can be a long and tedious process. You have a business to run! You don't want to have meeting after meeting, leading nowhere. In addition to being a huge time suck, hearing "no" over and over can be demoralizing.

Focus your energy and time on identifying the right individuals to approach. Think outside the box! Don't limit yourself to fishing in the same pond as all other business owners seeking funding. Your ideal investor may not have a fancy office in Silicon Valley or wear a suit — 99.7% of U.S. investors are not professional investors and do not self-identify as investors. You will not find them in any database of investors or meet them on a demo day. The key to finding the right investors is to keep an open mind about who your investors will be.

The 99.7% of investors we call "non-professional" are incredibly diverse, and millions of them! Non-professional investors have most of their money invested in publicly traded companies and may have never before considered investing in a small business. That is what makes them such great potential investors for you — they don't have preconceived ideas about what an investment in a small business is supposed to look like; they don't have massive amounts of founders all competing for their attention; and they are likely to be excited about the possibility of investing directly in a small business that aligns with what they care about.

Your ideal investors are likely to be people who are passionate about the mission of your company. This could include your current and potential customers, other businesses in your supply chain, activists who care about the problem your business is trying to solve, people who are positively impacted by your business, people in your geographic region who want to keep wealth local, and many more. Think outside the box to identify potential investors that are not the usual suspects.

Important disclaimer: Don't start talking to potential investors about your investment offering without consulting legal counsel with expertise in state and federal securities law.

Related: 4 Secrets to Finding the Right Investors and Raising More Money

Step 3: Create your offer

What you offer to investors will dictate your future relationship with them and is one of the most important decisions you'll ever make for your business. Many lawyers and funding advisors offer a cookie-cutter, one-size-fits-all approach that may not be right for you. It's important to know that your offer can be tailor-made to retain the control you desire over your business and for your investors to get paid without having to have an "exit" (i.e., sell your company) before you're ready.

When you take the time to craft your offer to fit your particular goals and projections, you ensure that your investors' expectations are in sync with yours. Rather than sowing the seeds for future conflict, you create alignment with your investors from the start.

Step 4: Choose your legal compliance strategy

Raising money is a highly regulated activity. You must comply with complicated state and federal laws when raising money or risk legal action by your investors and regulators. Most lawyers will say you should only talk to accredited investors. Accredited investors are wealthy individuals and organizations. Approximately 6% of the U.S. population is accredited. That really limits your pool of potential investors.

The good news is that these lawyers are wrong! There are legal compliance strategies that allow you to raise money from a much broader pool of potential investors. Knowing what legal strategy works best for your situation will empower you to reach the right investors to help you achieve your goals. If you need a cheat sheet on the options you can choose when raising investment capital to ensure your offering is compliant, check ours out here. Again, don't start talking to potential investors about your investment offering without consulting legal counsel with expertise in state and federal securities law.

Step 5: Design your investor enrollment strategy

It's important to know what your ideal investors are looking for so you can appeal to their desires and make a compelling offer. Here's a hint: They are looking for more than a significant financial return. Non-professional investors care about positively impacting their investments and the non-financial benefits of investing, such as being part of a like-minded community or access to cool perks. The more you know about what is important to an investor, the better you will be able to make your offer compelling. And you will also know quickly whether the investor is wrong for you so that you can end the meeting early and avoid wasting time. The key to successful enrollment conversations is authenticity — don't hide your mission and what makes you passionate about the business. Instead, embrace your mission and find investors who want to support it.

Related: How Startups Can Attract the Right Type of Investors

Step 6: Address obstacles head on

You need to have the right tools and support in place so you're prepared for whatever happens on your capital-raising journey. In most cases, raising money is a marathon rather than a sprint. Day in and day out, you will experience highs and lows, from meetings that don't go well and feelings of overwhelm to moments of confidence and elation. Here are a few ways to address obstacles you may encounter on the road ahead:

  1. Examine negative beliefs about asking for money and growing your business, and realize there is very little truth to them. Dragging our misconceptions, fears and anxieties out into the light of day often helps loosen their grip on us.
  2. Notice the positive side. Just about every "negative" characteristic has a positive side. For example, if you worry that you are too cautious and don't seize opportunities quickly, think about all the times that quality has helped you avoid mistakes. Reframe negative descriptions to focus on the positive. Say to yourself, "investors would be fortunate to invest in my company because I am such a careful steward of resources."
  3. Remember that investors often struggle to find good opportunities. For the right investors, what you're offering them is at least as valuable as what you're asking for, if not more so. When talking to potential investors, start by asking many questions about what's important to them. If it becomes clear that your offer is a good fit, be bold and make your offer.
  4. Be willing to say no to the wrong investor. If your gut tells you that a potential investor is not a good fit, listen to that. Do as much due diligence on potential investors as they do on you. And listen to both your head and your intuition (body, heart, spirit, gut . . ..) when deciding whether to accept an investment.
  5. Remember that objections don't always mean "no." In sales, objections are often seen as a "buying signal." Sometimes, when investors ask difficult questions or make critical statements, it signals that they are interested but need to know more to feel comfortable. These questions and statements can cause rejoicing — they often signal that you are getting closer to a yes!


Finding values-aligned investors is one of the most rewarding things you can do as the leader of your business. I hope this formula sets you to satisfying and mutually beneficial relationships with supportive, values-aligned investors.

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