The identity of the investment institution is dual, it is not only the buyer of the investment project, but also the seller in the subsequent financing. But in any case, for enterprises that need financing, it is a compulsory course to enhance the ability to communicate and interpret with investment institutions. While most business founders are very good at business negotiations, business negotiations have different impacts on business development than financing negotiations.

A company may have to go through countless business negotiations in the process of development, but only a few financing negotiations. The negotiation is successful, the enterprise receives capital support, and enters a new stage of development; Negotiations fail, corporate financing fails, and the status quo is either maintained or overtaken by other businesses. And for investment institutions, what they are best at is financing negotiations. Therefore, in the process of financing negotiations, there may be some disagreements or frictions between the investment and financing parties, complaining to each other, and turning against each other, resulting in the failure of investment and financing.

In order to prevent the above problems from occurring, enterprises should change the concept of communication and negotiation and abandon the thinking and mode of business negotiation. Many enterprises feel relatively smooth at the beginning of the docking with capital, and there will be many disagreements after entering the negotiation process, and the main reason for this situation is that the company's negotiation skills are used incorrectly. In business negotiations, the purchase and sale of products are mostly equivalent exchanges. But in financial negotiations, equity deals are mostly premium exchanges. In this way, in the negotiation of equity financing, the person in charge of the enterprise will not achieve the expected results by using business negotiation techniques such as psychological tactics, roundabout tactics, bidding tactics, and time tactics.

After all, for enterprises that need financing, the success of financing is directly related to the survival of the enterprise. But for investment institutions, there are many high-quality investment projects, and they can choose at will. As a result, many business negotiation techniques are ineffective in financing negotiations. Of course, if the development momentum of the enterprise is strong and it is only one step away from the IPO listing, it will have an absolute advantage in the financing negotiation, and there is no need to think hard about negotiation skills, just wait for the investment institution to come to the door.

◆ docking to the right road, targeted

Founders will be restless and trembling when they first contact an investment institution, and they will often adopt a negotiation strategy in all directions in the face of due diligence arranged by the investment institution, but the results are not satisfactory. Because many investment institutions will entrust due diligence to a third-party institution, and the project leader of the investment institution will coordinate it. Therefore, the financing company should do a good job of communicating with the person in charge, rather than negotiating too much with the due diligence personnel.

In addition, in the process of financing negotiations, some business founders adopt a business negotiation method, bypassing the middle layer and directly connecting with decision-makers. If it is a government guidance fund, because it adopts a top-down decision-making mechanism, enterprises can adopt a top-down negotiation strategy. But in the case of private venture capital institutions, this top-down negotiation strategy will not work.

Because the project initiation meeting and investment decision-making meeting of these venture capital institutions are generally led by the direct person in charge of the financing project, they need to be endorsed by the project leader or investment director, that is, the first person in charge of the financing project is required to be tied to the shares. In this way, if the financing company wants to convince the venture capital institution to invest, it must first gain the trust of the first person in charge of the project.

◆ Be well prepared, and the soldiers will face each other

Before financing, the enterprise should set up a special financing team, headed by the founder of the enterprise, and composed of financial leaders, business leaders, external investment and financing consultants, lawyers, etc. On the one hand, the financing team should cooperate with the due diligence of the investment institution, and on the other hand, participate in the financing negotiation as a representative. Generally, companies appoint a financial advisor or a lawyer with experience in the securities industry to act as a front-line negotiator.

In the early stage of negotiation, the founder of the enterprise should follow the principle of "soldier to soldier, general to general", appoint a financial adviser who is familiar with investment and financing or the person in charge of internal financing to serve as a front-line negotiator, and mediate with the person in charge of the investment institution. At a certain stage of negotiation, after all matters are basically agreed, the founder will come on the stage to make decisions.