How to Attract International Investors

International investors can add value and scope to your business.
• The most important prerequisites for attracting international investors are a strong business model, extensive research and a committed network.
• Investors expect you to know everything about your business and how it operates in an international marketplace.
• There are many resources available to help companies find international investors.
It can be a daunting task to attract international investors to your business. It takes time, effort, confidence in your business and a willingness to deal with rejection. With the right tools and preparation, you are well on the way to entering a foreign market with the support of an international investor behind you.

1. Start with a strong business model.

Any good business decision is based on a strong and well thought-out business model that supports the successful operation of your business. It identifies your revenue streams, customer base and financial details.
Your business model must prove that your business can be profitable in the international market by demonstrating how successful it has been in your own country. Getting into international markets is often riskier than the domestic market, as there are several new variables that need to be addressed, such as: Different state regulations and market variability.
 Foreign investors are therefore more cautious when making new investments and you have to work harder to convince them that your business is worth the risk. A detailed business model that proactively answers investor questions helps you to determine your credibility as an investment.

2. Be prepared.

Before you turn to international investors, you should prepare as much data, research and information as possible. You need to know everything about your business, the market you want to enter, and how your business will develop in this market. Their preparation strengthens investor confidence in you and shows that you can navigate the complicated world of foreign markets.

You should have the following at hand:

• Important data that demonstrates the success of your business in your home market
• Predict how you want to continue this success internationally with supporting data
• Documentation on how your company will operate in accordance with the regulatory requirements of the countries concerned (for example, if you need regulatory approval, have the forms and schedule available).
• A list of possible pitfalls and how you want to control them

You should also be able to show what an investor can benefit from partnering with your business.
"Focus on the benefits of investing in your business over your own country," said Stacy Caprio, Founder of Accelerated Growth Marketing. "If there are tax or profit advantages, let them know and be clear about this in your marketing."

You should also be aware of the cultural norms of the country or countries you want to work with, as ignorance or misunderstandings can be catastrophic for a business.
"You know they may work differently than you," said Charles Floate, owner and CEO of DFY Links. "It's worth looking for potential partners before signing on the dotted line."

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3. Choose between vertical and horizontal foreign investment.

There are two main types of foreign direct investment - horizontal and vertical. Horizontal investments are most likely to occur when one company (investee) merges with another (investor) company offering the same products or services from another country in order to become stronger in that market. The goal is to reduce competition and gain foreign market share.

The second type is a vertical investment in which an investor merges with an investee in another country to add value to their supply chain and to complement their business. For example, your company may develop a component or strategy that the investor needs.
To decide which type is best for you and your business, consider which products or services you offer and what you expect from entering a foreign market.

4. Build an international network.

If a business model is the foundation of your business, networking is the catalyst for its growth. It is difficult for any company to get onto the market without a good network, and even more so for a company that wants to operate internationally.
An easy start is online. Use LinkedIn to find the industry leaders and key investors in your area and connect with them through a shared contact or interest.

Having a social media presence that accurately communicates what your business is doing will solidify you as a legitimate investment opportunity and is one of the easiest ways to build a network. You can also grab attention by becoming an industry expert yourself and creating and sharing relevant content in your social media profiles. The most important thing to remember is that you get out what you typed in - being a passive follower will not change that.

If your alma mater had a strong international presence, eg. For example, if you have a branch campus in another country or a partnership with a foreign university, check if you can make connections with professors or other alumni, especially if they are in the market you want to go to.

You can also build an international team right away to make the international connections more natural, said Kaiwen Wan, CEO of Palapod. "We attract international investors by forming a diverse team ourselves," she said of her own company. "Although we're based in New York, I grew up in China and was able to earn a decent share of my startup capital from investors in China and New York, and I have a US-born co-founder who takes advantage of that." his domestic network and another Indian team member to source funds from the subcontinent. "

Outside of the digital space, look for networking events, conferences, or symposia in your area that you can attend in person. If a list of participants is available, read it to find out who you can talk to the best, rather than by chance to other people.

5. Use the available resources.

You should consider your network as one of your most valuable resources, which is why it is so important to build a good network. You can use your network to confidently introduce investors or investment groups and provide advice and guidance if you encounter complications.

There are also many online resources for small business owners looking for investors. The US Department of Commerce offers the SelectUSA program, which connects you to investors interested in your specific market, as well as various online investment platforms that will give you an idea of ​​what investors are out there and what they are looking for. These platforms include Gust, Angel Investment Network and AngelList.

While local search may not be intuitive, you may also inquire at your local Chamber of Commerce or Small Business Development Center. You have the resources to answer many business questions, and you never know which connections you can make - some may have international connections.