Whether you’re just starting out in property management or your company is well established, funding is always a top priority. So, what happens when you’ve poured countless hours – never mind your blood, sweat and tears – into a proposal and all you hear from potential backers is…*crickets*? If you’re struggling to get more investors, it might be helpful to understand some of the reasons why they’re not biting.
Poor Business Plan
If your business plan is missing key information – namely a clear and accurate picture of your real-world earning potential – investors won’t be likely to commit. Great ideas and lofty concepts are fine, but without proven results, they’re not worth much more than the paper they’re printed on. Make sure your business plan is thorough and in-depth to prove you’re worth taking a chance on.
This one’s a tough one, particularly if you’re in a geographical area where there are several other property management companies. Convincing a prospective backer to invest in your business can be much more challenging when the market is already saturated. The solution? Find your unique value proposition and sell the heck out of it. What sets you apart? Why is your company so different?
No Capacity for Growth
Most investors want to see a clear path to growth, expansion and increasing profitability over time. If your property management company does not have a feasible plan in place, you’ll be fighting an uphill battle when it comes to funding. Growth potential and a willingness to change paths as needed are essential to getting the attention and commitment of investors.
Your Team (or Lack Thereof)
Veteran investors recognize the critical importance of an experienced, cohesive team. If you show up to a funding pitch and the crew you bring along gives off an air of confusion, lack of confidence or general disconnect, you can expect your audience to see some big red flags. When investors see cohesive units, on the other hand, it inspires confidence.
Leadership (i.e. YOU)
Whether you’re the sole owner of a property management startup or just one of many who fill the c-suite, it’s up to you to make a positive and memorable impression on your prospective investors. In fact, most funders will look directly to the top of the stack when assessing a company’s merits, so make sure you’ve got your ducks in a row. Demonstrate poise, professionalism and passion and you’ll be more likely to get those investors to open their wallets.
What did we miss? Do you have any “tricks of the trade” to get investors interested in backing a property management business? Please share your thoughts and advice in the comments section below.