Do you have skin in the game?
Investors get pitched to all the time. So dazzling them with your brilliant idea won't always do the trick. In Bangladesh, most of the startups are a derivative of some foreign startup. (i.e. Uber for trucks, Twitter for senior citizens, Amazon for Nilkhet books, and more. We get to hear these phrases in many startup competitions.) This most likely means that the startup that's seeking an investment won't have an Intellectual Property (IP) related upside that will prevent new competition to enter the market. Investors tend to stay away from putting money in such markets.
So how do you sway the investment in your direction? Let them know how much money, time and resources you have invested in your startup. Wanting investment from VCs just because you have an idea and three of your friends are calling yourselves co-founders isn't going to work.
Is it the right time?
Suppose you are on the verge of launching a product in the market. Based on forecasting and customer validation, you believe it will be a quick and sure hit. If your investors are dangling a term paper in front of you now, and if you have sufficient funds, then delay the investment. When you have the new sales and revenue numbers after the launch, use those to renegotiate a deal or try to get a completely new one. On the other hand, if you think you are going to have a rough quarter and you need to go back to the drawing boards, then do so after you have secured funds so that you don't run out of money just because your product tanked in that quarter. In Bangladesh, most people are willing to settle the moment they receive a term paper or a letter of intent from an investor or VC. The offers are tempting, but you should only take it if you are absolutely sure that it's the right time for the business.
Is the paperwork in order? Is your house in order?
Most Bangladeshi startups don't have their papers in order. Here's the most common list of documents that you would be needing (not all of the following will be applicable to all startups): trade license, IRC, ERC, cofounders agreement, bond license, e-TIN, BIN, article of association, rent agreement, partnership deed, accepted copy of sanction letter, list of directors, latest board resolution, factory fire insurance policy, trade association membership certificate, enrollment certificate of EPB, group insurance, audit report, IP rights filing, any court orders, detailed information about all the employees including copies NID card and e-TIN etc. Each and every document needs to be up to date before or during the due diligence process. Or else the investment will be delayed.
Have you done your research on your investors?
In some instances, there might be multiple investors interested in your business. Will you be taking investments from everyone? Depends. Do a thorough research on the type of investor you want to associate with. Are they the best in their domain? How strong is their portfolio? Will they be able to introduce you to new and valuable stakeholders? Have they invested in similar businesses before? Are they lowballing you? Are they a good fit with your business? Will they meddle in your operation? Do they align perfectly with your strategic goals?
If you are satisfied with the answers to these questions, only then accept investment.
Do you have a detailed, well thought out plan of what to do with the new investment?
Lastly, you will have to ask for a specific amount of money from the investor. Before you do that, make sure you have a detailed plan on how you will spend the money and what your ROI would be. Make sure you have some room for a bit of cash reserve as things can go south anytime. The more meticulous your plan, the higher the probability of getting the funds.