How To
Big ideas, little money: getting ready to raise capital for a beverage project
Most likely all of us know that when speaking of a beverage business, there is no such thing as low budget. And we are talking about hundreds of thousands of Euros here.
If you have a young business and not that many funds at hand, your best options are either crowdfunding (Pura Vida Tequila and Clearly Canadian are just a few recently funded examples) or investors. Whichever you choose, you have to do your homework. Because if you don’t, you won’t get even a sniff of your beverages reaching the shelves of retailers.
Let’s talk about the must-haves when getting ready to talk to the investors.
Clear concept
I have recently written about questions your marketing plan has to cover. It would be a good idea to answer most of them when working on your concept too. If you have a clear picture of your idea, it will be easier to sell it to others.
Make sure you know your project head to toe. No matter how great your pitch presentation is, if you (or anyone at your team) are unable to answer the questions or are starting to make things up, investors will notice it and are likely to turn you down.
A very simple but proven way to avoid this is by listing all the inconvenient questions investors might ask and preparing to answer them in advance.
Recipe development and production of the first batch
Even if it seems quite tangible in your imagination, it is a rather long way from basic idea to market-ready product. The beverage might not taste as good as you expected, usage of certain ingredients (or quantities of them) you planned may be forbidden by law or the drink may just lack some key attributions. So basically it involves some testing and tasting before one comes up with the right combination of ingredients.
OK, so you have the recipe. Now you need some prototypes produced. Do you know where you will source the ingredients from? Where will the production take place? What type of packaging will you use and where will you get it from? If you do not have the necessary knowledge, time or funds for a proper research, getting help from some beverage industry experts could also be an idea to consider.
Exceptional packaging design
You must know by now, that competition in beverage industry is enormous, therefore your product really needs to stand out. Well chosen packaging design will serve well when attracting shoppers’ attention. So if you have limited funds, make sure you make packaging design your top priority.
Considering how hard it can be to get retailers even sell your product, you really need to make sure the drink gets noticed when it finally finds its way to the shelves. Especially if you are not likely to have a big marketing budget which you could spend on point of sale displays and other means of promotion.
Killer pitch presentation
In order to make a great presentation, you need to understand what your target needs to hear. Most of investors evaluate similar criteria, however it is always worth doing your research to find out what a specific fund is looking for.
The better you understand what is expected from you, the better speech you can deliver. There are lots of tips about building a killer pitch presentation one Google search away, so I would not go into details. My key advice to you – when practicing your pitch, think critically and ask yourself “so what?” after each statement you make. Investors are busy people, so there is no need for waffling.
By the way, make sure the slides you prepare are in line with your concept and support your speech but not repeat it.
Good luck bringing your ideas to life. Get in touch, if we could be of help along the way.
Original article was published in Beverage Industry Blog
