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5 Tips on How to get Past Investor Rejections & Plug Loopholes


As a young entrepreneur, you'll either have to dig deep into your pockets to get your business off the ground, or you'll have to spend time pitching and persuading investors to invest in your company so you can raise funds. Most entrepreneurs consider this phase to be inconvenient and time-consuming, and as a result, they abandon their businesses and goals.


Learning to effectively manage rejection as a founder is difficult — few of us enjoy being rejected, whether in our personal or professional lives. Nonetheless, it is a truth of life that one will be rejected. We all get rejected from time to time, but as an entrepreneur looking for finance, learning to deal with rejection successfully is critical. While coping with rejection, in general, is painful, being rejected by a potential investor or backer may be especially damaging and difficult to manage.


When a potential investor or funder rejects us, we often take it personally and see it as a reflection on ourselves. To put it another way, we interpret it as a personal failure, a lousy business strategy, or, even worse, a bad idea. However, this is not the best method to deal with rejection. Returning to this method is not only ineffective, but it also creates a negative feedback loop that makes recovery and progress in the fundraising process increasingly slower or more difficult.


So what is the secret technique to leverage rejection and create success? Here are a few of the powerful strategies for dealing with rejection and using it to your advantage to secure the financing you require.


  1. Don’t Take It Personally. If an investor or funder rejects your pitch or funding request, the first and most crucial step you can take to properly manage the rejection of your company, business concept, or project is to not take the rejection personally. The majority of the time, funders or investors reject pitches or proposals because they don't align with their existing priorities. Understand that rejection of your pitch is not meant for you. Taking it personally will not help you and will put you back.

  2. Don’t Get Discouraged. Don't become discouraged if your financing pitch or plan is rejected. Getting melancholy or disappointed, like taking rejection personally, generates a downward spiral that leads nowhere. Furthermore, don't become enraged if an investor or funder rejects your pitch or idea. Offended by rejection, you may say things to a target that may come back to bother you later, jeopardizing your future funding opportunities. Keep in mind that many investors, funders, and financing agencies have met at conferences and networking events. They talk to each other a lot, therefore you don't want to get a negative reputation.

  3. Improve Your Pitch. The most crucial thing an investor looks at is your business pitch. It's essentially a condensed version of your business plan, and it ought to be compelling enough to pique the interest of a potential investor. In this pitch, you are given a minute or two to pitch your idea in a few phrases — you should be able to convey your complete business idea as well as why it is beneficial to the investor. You will be awarded if you can accomplish this.

  4. Review Your Business Model. Rejection can always be used as a teaching tool, depending on how you approach it. You should analyze your business model and hire a consultant to go over it with you to discover what problems, drawbacks, and weaknesses you have so that you may correct them and improve your business concept. Fixing model flaws, conducting extensive market research, and calculating estimates can make the difference between a brilliant concept and a good one. A potential investor might be interested in taking another look at your proposal once you've finished and improved it.

  5. Continuous Improvement is the Key. Take whatever comments or constructive criticism you receive after your pitch or plan is rejected and utilize it to enhance your approach. If you're lucky enough to have someone give you honest, constructive criticism on your pitch, take advantage of it and apply their suggestions to improve your pitch! If you pitch to a large group of people, you may receive a variety of responses, some of which may be inconsistent. Remember that you can't please everyone, therefore you'll have to pick and choose which appropriate feedback to pay attention to depending on your circumstances.

Conclusion

When someone rejects your pitch or proposal for any reason, treat the situation with dignity and politeness at all times. This is an important stage in learning how to deal with rejection as an entrepreneur. Remember that "no" may just be "no" for the time being and not forever.

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