How to Attract An Investor to Your Supplement Company

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How to Attract An Investor to Your Supplement Company

By Zachary Litton | | 1 Comment | 27 October, 2017

Ready to start your supplement brand, but not quite there with the capital? An investor could help power your dreams by supplying the funds you need to launch your brand. Finding the right investor for your brand can take time though; you’ll need to fully develop your idea of concept, have a complete business plan in place and be ready to talk real dollars and cents with the prospects you attract.

How to Attract an Investor to your Supplement Company

One of the challenges of starting a new supplement company is the need to show results to recruit investors. Even starting small can help you show that your idea, branding and approach work; investors would be needed to scale up your brand, not launch something entirely new and untried. Nothing showcases what you can do better than a history of success, so even on a small scale, results help.

Partnering with another founder with a different skill set can also help when you search for investors; a team of talented, savvy co-founders may be more appealing than a solo founder when it comes to investing.

 “Angels and VCs often look for talented co-founders, as opposed to a single founder, which is a rarer case,” according to Ben Lang of Mapme.

In addition to your typical business plan and an early start, letting investors know that they’ll get a return on their investment can also help you attract candidates. Investors aren’t just benevolent patrons, they are there to make an income as well. Including this information in your spiel as you talk to investors can help you get the attention and interest you want for your brand.

Surging Investor Interest in Supplements is Good News for Startups

A recent piece in the LA Times has good news for those hoping to find investors for a supplement startup. Thanks to an increase in consumer interest in wellness, investors are flocking to the supplement business, hoping to cash in on the latest trends. Highly publicized, celebrity backed product lines have also helped increase investor interest, which spells good news for those hoping to launch a new brand or product line.

According to Forbes:

“Investors expect big paydays because of several apparent cultural shifts. People now are accustomed to paying monthly for a ration of products and services, whether it’s supplements or shows on Netflix.” This consumer drive to buy makes supplements, which are consumables and replenished regularly, very attractive to the investment community.

While experts caution that the supplements invested in need to follow all FDA guidelines when it comes to not only formulation and packaging, but claims as well, the industry is currently seen as one to watch for growth and high returns. For investors who are already backing products that promote health, wellbeing and natural living, supplements are a natural extension; for those new to the industry, supplements are poised to create profits and already have a strong track record of success.

8 Tips for Attracting Investors to your Brand

Build your Network

 The more people you know, the more opportunities you have to make a connection that could help you find your angel investor. From local networking events to industry conferences and other events, you could meet your next investor in a wholly unexpected place. The more you grow your network, the easier it will be to secure introductions, boost your brand awareness and connect with those who might be able to help you grow your business. Investing does not happen in a vacuum –  you’ll need to get out there and make some connections if you want to launch your brand with an investor.

Be an Expert in your Industry

The growing interest in the supplement industry could mean that investors are already looking for ways to connect, but you’ll need to be able to speak as an expert and authority of you want to get backing. Know what works, what doesn’t and how you will position your brand for success before you even begin looking for venture capital.

Make Realistic Projections

A sure sign of a new business owner is the unrealistic sales expectations that are present in their proposed growth statements. If you are projecting off the charts growth right from the start, then your plan won’t be seen as realistic and could impact the way a potential investor sees you and your brand. Be realistic and honest about what you expect and you’ll be more likely to seal the deal.

Have a Written Business Plan

You’ll need to have a plan in place, not just an idea. Preparing a comprehensive business plan allows you to present your idea to investors in the right way. They’ll be able to get the answers they need and see that you truly know what you are doing. You’ll benefit as well, since you’ll have clearly laid out goals and will have already detailed the steps you need to take for success when the capital does roll in.

Don’t Forget Friends and Family

Offering family members a great return on a short investment can help you launch your business, as can crowd funding and similar initiatives. Even those friends who can’t invest may be able to connect you with someone who can, so spread the word about your plans and needs.

Use Real Numbers

When you state the value of your company, use real comparisons and valuation to do so; comparing your brand to other new ventures as opposed to established, household brands can help you get a clear idea of where you stand and where you could go.

Be Selective

It is exciting to receive an offer, but you need to make sure the investor is a good match for you as well; if the money offered comes with too many strings attached or there will be micromanaging involved, it may not be worth accepting.

Don’t Give up Control of your Brand

You want an investor who is a partner, not a boss. The whole reason to get investment capital is to make your vision come alive – and keep it yours. Read the fine print carefully and make sure you know what you are agreeing to before you commit.

It may take some time, but learning how to attract an investor for your supplement brand can help you scale your business at a more rapid pace and fulfill demand quickly. The rising interest in supplements and wellness makes this the ideal time to look for investors for your brand and to make your dreams of running a supplement company a reality.

Zachary Litton

Written by Zachary Litton

Zach is a senior account executive here at ABH Pharma. Zach has years of experience working with both Supplement Brands & Manufacturers, giving him great insider knowledge of operations & sales methodology that works within this industry. Zach is constantly reviewing new product trends and listening to feedback from industry leaders to better his clients.

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