Entrepreneurs full of hopeful ambition have long lined up to plead their cases to potential investors. But as many as 95 per cent of these aspiring Steve Jobses are turned away for any number of reasons.
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A small number, though, secure the capital they need to take their businesses to a whole new level.
Naturally, many entrepreneurs want to know how to replicate that success.
Some start by approaching their friends or family members. This tactic is fine, experts say, as long as an entrepreneur remembers to treat these individuals as investors.
"Don't treat them as friends or family," says Ron Ribeiro, the chief executive of Aryan Business Consulting, which advises entrepreneurs in the UAE.
"All businesses can go up or down. Be transparent," says Mr Ribeiro, who recently spoke at the Dubai campus of Australia's University of Wollongong during Tamakkan, a monthly seminar that fosters entrepreneurship and the growth of small businesses.
From an investor's perspective, a solid business plan is crucial. Even so, some investors acknowledge that there is only a slim chance that an entrepreneur will obtain outside funding.
"A lot of plans get rejected," says David Moleshead, a co-chairman of Envestors Mena, which connects private investors from the Middle East and North Africa who are seeking to put between US$40,000 (Dh146,936) and $4 million into early-stage businesses.
"We would say 95 per cent of those [business proposals] we see we don't proceed with," Mr Moleshead says.
"That's not necessarily because they're bad ideas, but some are too early. Some need a little more research."
Businesses are attractive to some investors when they can generate revenue, even if the ventures are not necessarily profitable. The key is to have a company that provides a product or service that justifies an investor taking 20 to 40 per cent of the company's equity, says Mr Moleshead.
At Envestors Mena, investors want the entrepreneur to continue driving the growth of a company so that they can earn at least a 40 per cent return upon exiting in three to five years. Mr Moleshead says his group's investors want to see entrepreneurs also put some of their own money into the ventures.
James Caan, who invested more than £1m (Dh5.7m) in 14 companies during his tenure on the BBC TV reality programme Dragons' Den, takes a different approach to investing in companies. Part of an entrepreneur's success while pitching a venture boils down to personality, says Mr Caan.
"One of the things that always separated me from the other dragons [investors] was when I was investing in a business, my philosophy was always to invest in the individual," says Mr Caan, who was recently in Dubai to expand one of his own ventures.
At one point, Mr Caan says, he had a portfolio of 40 businesses, including 26 in which he had personally invested, outside of the Dragons' Den show.
"I believe the success depends on the entrepreneur - not product," he says. "My primary focus has been to understand the desire of the entrepreneur."
For an exclusive video from Tamakkan, with tips for entrepreneurs who are seeking outside investors, visit https://www.thenationalnews.com/thelife
