How to Find Foreign Investors
There may be plenty of reasons to expand beyond the comfort zone of home when starting a new company or seeking investors to help fund your project. For starters, your country may not offer the kinds of investors you are looking for, necessitating the need for a more widespread search for international investors. Additionally, going global helps you tap into the capital, technology and talent that at one time only large companies could access.
Approaching existing foreign or multinational companies with a view to forming joint ventures, subsidiaries or strategic alliances may be one way to reach into the foreign investor pool. Any quest to find international investors this way involves finding the right contact person by researching who is in charge of business growth or strategic partnerships. You also should take care to address the potential gains and pitfalls of investing through the foreign investor's eyes.
In this vein, the business plan you present to foreign stakeholders should discuss capital budgeting decisions adjusted for political and economic risk; cross-border cash flow optimization; and tax and transaction cost reduction policies.
Instead of taking a scattershot approach to finding international investors, go where the prospects are. Major international trade fairs in your field bring potential foreign investors to a centralized location. International trade show directories such as Expo Database help you zoom in on specific industries, countries and cities. For example, Expo Real and Le Marché International des Professionnels de l’Immobilier are venues for real estate professionals interested in meeting foreign investors.
International investors come in all forms, from private equity and venture capital firms to angel investors. Narrowing down a set of foreign investors that are appropriate for you can be challenging without some sort of information management system to crunch the numbers.
On the venture capital website VCGate, you can specify potential international investors not only by country of origin, but by investor type, stage of investment funded, amount of funding sought and preferred sectors. Another database connecting startups to investors worldwide is Gust.com, which lists investors by industry, location and investor type.
Just when some start-ups throw in the towel on finding a foreign investor because the latter have too strenuous criteria, others are learning about the benefits of programs that are tied to foreign investor visas. For example, with the EB-5 program sponsored by the United States Citizenship and Immigration Services, entrepreneurs get to access foreign investors in exchange for the foreign investors obtaining a green card. Entrepreneurs work with third-party intermediaries in securing EB-5 funding. However, entrepreneurs should be prepared to put up a lot of money upfront in administrative and travel expenses, and endure long wait times.