Mission – Successful fundraising for developers – AIDA
A few of you reading this will recognise the acronym AIDA from sales and marketing’s – Attention Interest Desire Action. That is not what I refer to this time however keep that in mind as you read this. Having helped a number of persons how to raise money and funded many deals over the years a few fundamentals make sense to share with the National Development Submit.
AIDA this time stands for Analyse, Identify, Deal and Action
Analyse the task at hand, funding options that match the project. Have you positioned yourself already with some key parties? What is most important this time, rates, timing, cost or terms.
- Do you have the track record to give certainty and confidence to the potential investor? Partnerships are key to bridge any unavoidable gaps.
- Assess costs for the different funding options and potentially have a mix of funders. Include back up options as at this stage you will likely need them.
Identify the different ways to fund your project and compare your alternatives. The Better project as well as security the broader range of options.
- Clarify funding timing, cash flow and peak funding times
- Identify potential investors, brokers or platforms
Deal what is the deal that you offer? Put yourself in the investor shoes for a second, what would you like to know, have as security and get in return?
- Balance risk versus reward
- Allow the due diligence to be easy for investors share key information about the project in a way that is understandable for the audience
- Provide third party information, for example a RICS valuation and potentially a Redbook valuation (a qualified post work valuation also conducted by a third party)
- Match the right lenders with your project
Action your offer and ultimately your own conviction are transferal of feelings, and will come across, do you believe in what you propose and love your own deal?
- Don’t forget to connect on a personal level
- Pitch or present to your target audience and preferred lenders
- Deliver on the promise the actual construction as well as quality, in terms of information you have agreed, payment terms, timing and ultimately the repayment of the principal if applicable.
- Don’t negotiate yourself out of the deal. Present and then listen to the feedback or questions.
Suggestion stress test your funding options, can the time be extended without extortionate fees, can the project afford the funding costs and mainly for your own sake try to not give away too much of the profit after costs.
Strategic Advisor and Investor in Crowd With Us Ltd & Managing Director of FundX
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