If you're producing an independent film or any kind of theatre project, it's a safe bet that, at some point, you're going to be asking the question: “Where do I find investors?”.
Well, the answer is deceptively simple, and yet still amazingly complex. In short, investors are all around you. You just need to know how and where to look, how to approach them, and how to close the deal. Then, it's also important to service your investors by keeping them informed.
Investors all around
There are, essentially, three sources of investors for your project. They are:
I'm sure you know where this is going. If you're setting out to raise money for a project, you have to start with your warmest source of leads. Your relationships. By this, of course, I'm referring to your family and friends.
If anyone is going to be inclined to invest, it's going to be the folks with whom you have preexisting relationships. And let's not make any bones about it. These folks aren't investing in the project, they're investing in you. Sure, they're interested in the ROI. They'd like to get rich from investing in your project, but that's not likely to be their primary motivation. They invest because they care about and believe in you.
“But wait” you say. “My friends and family can't afford to invest.”My response: “How do you know. Have you asked them?” They might just surprise you.
But really, even if they don't invest with you, it's important that you ask them. Not doing so costs you the opportunity to refine your pitch. To rehearse, if you will. And, if you don't ask, these folks might just feel a little bit insulted.
I experienced this first hand a few years ago. I had an investment opportunity, and I never asked my closest personal contacts. One of these later found out about the missed opportunity, and confronted me. “Why didn't you give me a chance to invest in your project?” he asked. “Don't you believe in your project enough to share the opportunity with me?” Needless to say, this was embarrassing for me. Even more so, because his investment could have made my life so much easier.
Another advantage to asking your family and friends is that, even if they're not ready or able to invest, they likely know others who might be. Referrals are the next warmest leads you will get.
But you have to ask. A good rule of thumb is never to close out a conversation with anyone about your project without asking, “Whom do you know who'd be interested in this?”
Note that construction. It's not “do you know who….”, it's “Whom do you know”. This assumes that your contact does in fact know someone. It heads off the option to just say “no, I don't know anyone”. It's subtle, but it really can work.
Don't let folks off the hook too easily. Encourage them to brainstorm. Describe your “ideal” investor profile, and press until they identify someone you could talk to. Then, ask for the introduction.
From there, your job is to build relationships with the people to whom you're referred. Don't just blast into the first conversation with a referral with a “Hey, do you want to invest in my project?”.
Next, is research. If you have a project that will appeal to members of a certain community, or demographic profile, or folks with an affinity for a particular sport, or author, or whatever, you owe it to them to share your investment opportunity with them. Don't you?
So, hit the internet. Identify some of the top influencers in that group, and make contact.
Again, though, this isn't about a quick pitch. Instead, you need to try to build a bridge to the community in question. Relationships are key, so take the time to build and nurture them.
Let the influencers know what you're doing, but without overtly asking for the investment. At least at first. See if you can't get some buzz going in the community about the project. This way, the influencers become a part of your sales team. They become referrers. That way, you're not going in “cold”.
It also pays to conduct research into similar projects to yours. Who invested? Why? doesn't it make sense to contact those folks with your opportunity, too?
How to get referrals to specific people you've researched.
This one is actually very simple. More research. Ask your existing contacts if they know the person you're trying to get to. Ask for an introduction. Exploit the theory behind “Six Degrees of Separation” which tells us that everyone is no more distant than six contacts away from anyone they want to meet. You can also work this in reverse. Whom does the person you're trying to reach know, and who in your circles has a connection to those persons. It's a lot of legwork, but it can really pay off.
Getting investors is a SALES process.
Let's face it, most of us in the arts aren't excited at the prospect of being salespersons. But the truth is, if you want to create art, you've got to sell. The trick is knowing what it is that you're really selling.
This will be different depending on who you're selling to. If it's family and friends, you're selling YOU. You are asking folks to buy into your dream, and your passion for the project. If you're reaching out to referrals, it's going to be more about the project, but don't discount the referral's relationship with the person who made the introduction. By investing with you, the referral can cultivate greater esteem from the referrer. Why not sell that, at least a little? And, if you're reaching out to folks you've researched, you're selling whatever aspect of the project led you to identify them as a prospect. So, of course, you have to know what that is.
Finding investors isn't that hard.
Finding investors isn't as tough as you think. What IS tough is making that call. Asking that family member or friend for help. For that, there's no cure other than to suck it up and do what it takes.
The good news is that, using the techniques outlined in this article, you can often turn a prospect you've researched into a referral, and thus avoid cold-calling altogether. But, even if you DO need to cold-call, if you have true passion for your project, you'll do it. And THAT passion; that drive, is what investors like to see.
What is your best investor-finding tip?
In a future post, I'll dig into how to pitch those investors, and how (and when) to close the deal. Meanwhile, what's your best tip on where and how to find investors?