No matter what your goal is, preparation is the key to success. So, before you seek funding from an investor, there are some specific steps you should take to improve your chances of getting money – plus it will put you in a better position for start-up success. Here are the five top things I’ve found have been beneficial for those businesses I have launched:

1. Present a Business, Not an Idea 

Investors hear ideas on a daily basis. While many sound great, they may not be viable. Even a business plan is simply is not enough to attract an investor. You must be a business with a model that scales, a product or service that has “legs,” and even people in place to make it happen, including the talent infrastructure. Even then, you still have to prove you know what you are doing. Make sure you  have some experience in operations before seeking out investors. This will allow you to illustrate how you have handled hurdles and what opportunities you are currently developing, including a pipeline of leads. That additional experience under your belt (before asking for funding) increases your ability to generate a return for that investor.

2. Show Cash Flow 

Even if it is not much, be able to at least show there is money available to further the interest of any investor. They want to know you are not simply seeking cash to keep the doors open, but that the funding is actually for growing the business. Most investors realize you have to spend money to make money, but they want to ensure their money is not there for utility bills and rent but for making more of a product or expanding a service so they can get their return on that investment. Another reason to show some cash flow is that some investors will realize you have a great idea and a viable business model, but know you are desperate because the bank account reads “empty”. That means they can have you in the corner and may try to gain greater control as they hold the possibility of money over your head. You don’t want to be in this kind of position, so make sure you do not appear financially panicked. To maximize what little money you may have before seeking out funding, employ creative strategies to grow the business as much as possible without financial assistance, including getting talent to work on an incentive basis, such as for an equity stake.

3. Know What You Need & Want 

Before you ask, you need to know what you are asking for. Are you getting capital for resources, such as equipment and talent? If so, perhaps you just need a partner that has those resources already and is willing to work based on revenue sharing rather than bringing in an investor just for the capital. Do you want an investor that brings the capital but who can also serve as a mentor or connector? How involved do you want the investor to be in your business? Most likely, they will want to have some say in the matter because their money is on the line. Make sure you know what boundaries to set prior to finding an investor so you are comfortable with the relationship. Asking these questions and knowing the answers is very important before seeking investment because it will help align the investor with your needs – and raise your chances of success.

4. Do Your Research

Once you know what you want and need from the investor, it’s time to do initial research about the type of investor you are looking for and who those investors are. You can be sure any potential investors will be researching you – through your website, social media platforms, and trade publications, so make sure you are doing your research as well. Attend investor seminars, conferences, and networking events to learn and even interact with investors before approaching them for funding. Taking the time to study your potential investors helps you to better understand what is involved in raising capital and what type of investors are out there. You will be able to learn more about who you want to partner with, who is interested in your business, how well they might understand what you are trying to achieve, and how investor relationships work.

5. Develop Strategy & Vision 

While the other tips have focused primarily on the ‘now,’ you must also be prepared to discuss the future in detail with potential investors. This means formulating your strategic objectives for the business, which you may have already defined in your business plan for the first and second years and then onward as well as the overall vision for the company. For example, will you continue to grow and expand the business alone? Will you seek out strategic partners for new products and services? What is your exit strategy? These should be in your mind already because they are the driving force behind how you develop and launch your start-up. They provide the blueprint of the company with you as the architect and your team and the investors as the construction crew and bank behind the project.

These five areas provide a way to clarify and solidify what you want to do with your business plus they offer the means of defining the type of investor you want to approach for capital.