How can I get investors and the necessary financial backing to fund a large idea I have. Would need millions.?

Question

For real. Please no sarcastic answers.

Thanks

Answer 1

Investors for any type of new business are actually much harder to come by than most new entrepreneurs imagine, primarily because there are many more entrepreneurs than there are investors. As a matter of fact, fewer than 1 in 100 new business plans get funded by outside investors, so the unfortunate truth is that the odds are very, very much against you at this point.

To put things in perspective, each year in the United States there are roughly 600,000 new businesses that are started. The only sources for 'millions' of dollars in seed capital, which is what you are seeking, are venture capital investors. Last year, all US venture capitalists combined invested in fewer than 1,200 seed or early stage deals, giving you odds of 0.2%. On top of that, virtually every single one of those investments went to experienced entrepreneurs with whom the investors were already familiar.

After venture capitalists, the next source of early stage capital is from Angel Investors. But they, too, are very picky, also investing in fewer than 1% of deals they see. And angels typically invest much smaller amounts, in the range of $10,000 to $100,000.

Compounding the problem is that even those angel investors who might be interested in investing in your project would generally prefer to invest in (a) an experienced entrepreneur, rather than a first time person, no matter how smart or enthusiastic, (b) a business that already has a product, and perhaps even revenues, instead of simply a 'large idea', and (c) a business into which the entrepreneur (that is, you) has already invested a good bit of his or her own money to get things started (which in this case, if you were looking for millions, means that they would expect you to have put in yourself, or from friends and family, some hundreds of thousands of dollars already.)

Nevertheless, taking all of the above into account, the first place you should look is the Angel Capital Association website (see below) which has links to dozens of organized, legitimate groups of angel investors, as well as tips about raising funds, and links to lots of informative material. Another excellent source is the web site of Bill Payne, a well known angel investor and early stage consultant, who does a lot of the training for the ACA, and who has written a great book about seeking funding, which is available from his site, www.billpayne.com.

Good luck!

Answer 2

There are venture capitalists, but most invest smaller amounts than "millions" and you'd need a strong business plan, not just an idea.

Good luck though.