Step 1: When Raising Capital, Tell a Good Story

By, Dennis Crowley & Tyler Andrews

For those who have ever raised capital for either a company or fund, or if you have looked at investing in these opportunities, we can all agree that investing in these alternative investments is a complex process that requires careful analysis of financial statements, market trends, and competition. However, investors are not only looking at these numbers and/or the business plans; they are also paying close attention to the leadership team of the company / fund. In fact, one could argue that the first impression investors have of the leadership team can make a huge impact, and in some cases the deciding factor, on their decision to invest. One very powerful degree of change that we have seen for both capital contributor and capital recipient is whether or not you can reach them first with the story, then moving into step 2, which is due diligence. 

While investors will always do their due diligence in order to determine where to invest money, a decisive way to make a good first impression, and get that positive feeling of connection, is through effective storytelling and presentation. Storytelling is a powerful tool that can help investors understand the problem being solved in the market through your approach of implementing your vision, mission, and values of the company or fund. The style and timing of the story can also help investors connect with the leadership team on a more personal level, which can be crucial in building trust and confidence.  The core purpose of Trellis, an alternative investment platform, is to create a connection between the issuer and the investor by first telling the story, then giving access to due diligence via the virtual data room.

Effective storytelling and presentation are not just about presenting a polished pitch deck or a fancy website. It's about communicating a compelling narrative that resonates with investors on an emotional level. This means telling a story that is authentic, engaging, and relevant to the company or fund's mission and values. It's about showing investors why the leadership team is passionate and committed to making a difference in their industry.

One of the initial key pieces in effective storytelling is to know your audience. Investors want to hear a story that is relevant to their interests and aligns with their values. This means tailoring your story to the investors you are trying to attract. It's important to understand what motivates them, their values, what gives them meaning, what their investment criteria are, and what their long-term or end goals are.

Once you have a good understanding of your audience, it's time to craft your story. Your story should be carried by a cohesive narrative that is concise, engaging, and memorable. It should explain why your company or fund is unique, what problem it solves, and how it will create value for investors. Your story should also highlight the leadership team's experience, skills, and passion for the industry, and finally it should provide a clear roadmap for the customer and product journey.

Now that we have addressed our understanding and importance of the story “why” and “what” let's look at “how”. The next action step is to deliver your story in a way that is compelling and engaging. This means using a combination of visuals, storytelling techniques, and data to bring your story to life. That is where the Trellis Platform can help guide you as you build out your Trellis Digital Roadshow.  You want to create an emotional connection with your audience that leaves them feeling inspired and excited about the opportunity to invest.

In conclusion, it's important to understand that investors invest in private companies or funds based on not just the numbers and the marketing materials, but on how they feel about the leadership team. While investors will always do their due diligence, as they go through their investment process, the first impression is crucial. Effective storytelling and presentation can help create a positive first impression by communicating a compelling narrative that resonates with investors on an emotional level. Remember by knowing who are talking to and tailoring your story to your audience, by crafting a concise and engaging narrative, and delivering it in a compelling way, you can increase your chances of attracting investors and achieving long-term success.