Entrepreneur Guy Rigby argues that businesses often leave it too late when thinking about raising money. ‘Last minute planning will not impress your potential investors, who will wish to approach their investment in a measured and structured way. The smartest approach is to prepare and act well before the funding becomes a necessity,’ he says.

With this in mind, Rigby offers his top ten essential tips when it comes to thinking about and raising equity finance for your business:

1. Ownership determines outcomes – consider whether you need external equity or can you keep it in the family.
2. Plan your fundraising thoroughly and be fully prepared.
3. Research your potential investors carefully to make sure that they are a suitable fit for you and your business.
4. Make sure your management team is up to scratch – you don’t want any weaknesses in your line-up.
5. Be open and transparent in meetings with potential investors.
6. Get good advisers who care about you and your business.
7. Understand your financial position and forecasts – it isn’t okay to leave this to your financial team, so make sure you know the figures.
8. Do be clear about the amount and purpose of your fundraising.
9. Work with your advisors to establish the value of your business.
10. Remember that investors back people so be likeable and believable, not arrogant and over-confident.

Rigby adds, ‘There are many differences between a good business and a great business, but they aren’t beyond a business leader’s control. Successful entrepreneurs understand that there’s no need to embark on a long and uncertain voyage of discovery; plenty of people have been there before. The trick is how to shorten the learning curve, how to divide the business into its core elements and how to maximise the opportunities in each area.’

See also: Using Business Angel Networks to Raise Finance