The next big idea often faces a major hurdle: access to capital. In Jamaica, for the fiscal year 2015/2016, around 97.6 per cent of business taxpayers are classified as Micro, Small, and Medium-sized Enterprises (MSMEs), according to the Government’s 2013 MSME Policy definition.

The Planning Institute of Jamaica’s Foundations for Competitiveness and Growth Project reveals that 83 per cent of these enterprises operate in the micro sector. This tells us that many businesses start small and stay small.

Most MSMEs recognise the need for funding to grow, but many have no idea how to get it. For those seeking investment, the hard truth is that the business may not be investor-ready. This was a hot-button subject during the ‘Removing Barriers: Entrepreneurs Having Access to Capital’ panel discussion at the Jamaica Stock Exchange (JSE) Regional Investments & Capital Markets Conference. Alongside Karl Townsend, Chief Country Officer (Jamaica) for Capital Markets at JMMB Group Limited, and Latoya Wilson, Managing Director for Morgan Stanley-Inclusive Ventures Group, practical strategies were shared with MSMEs to overcome these challenges. Here are some things to consider:

Transparency

Transparency is essential for building trust. Before connecting with investors, make sure your books are in order. Showcasing financial stability through transparent practices demonstrates reliability and reduces perceived risks for investors. Think about it: Why would an investor put money into a business with unclear practices? Investors back businesses they trust, and clear financial records showing a growth trajectory play a key role in strengthening that trust.

Understandably, it is important to balance transparency with the protection of sensitive information. While sharing detailed financial records can build trust, it is also essential to safeguard proprietary data and maintain privacy. One approach is to provide summarised financial statements that highlight key performance indicators without revealing sensitive details.

Tap into Networks

Building trust with investors is one thing, but where do you find them? MSMEs miss out on valuable opportunities by not tapping into the right networks. Networking strategically by attending industry events, conferences, and workshops can help MSMEs connect with key players in the financial ecosystem.

To start, explore programmes like Morgan Stanley’s Inclusive Ventures Group, which offers funding, mentorship, and strategic partnerships. RevUp Caribbean is a virtual business incubator that provides investment readiness, management training, and mentorships, and gives members access to angel investment opportunities. Financial institutions like NCB Capital Markets Limited play a crucial role in supporting MSMEs. With its deep expertise in investment banking, wealth management, and securities trading, MSMEs get access to capital and strategic advice.

Foster Long-Term Relationships

Early engagement with potential investors can be a game-changer for your business. You should build relationships before you need funding. You can do this by sharing your vision and keeping potential investors informed about your progress. Consistent communication through regular updates instils confidence and demonstrates your commitment to success. Additionally, showcasing growth over time makes investors more likely to fund businesses they have seen evolve and succeed.

Tell Your Story

To make relationships count, tell a story that inspires confidence. A compelling story about your business can make a significant difference in securing funding.

• Share Your Origin: Why did you start this business? What problem are you solving? Sharing the inspiration behind your venture creates a personal connection with investors.
• Celebrate Milestones: Highlight key achievements that demonstrate growth and potential, such as entering new markets, expanding your customer base, or launching innovative products.
• Showcase Vision: Present your long-term goals with clarity. Help investors see how their capital will drive both growth and meaningful impact.

By weaving a narrative around your business journey, challenges, and successes, you create an emotional connection that makes your pitch more memorable.

Tailor Your Pitch

You’ve secured the chance to pitch—now it’s time to customise your approach. Understanding investor’s goals is crucial for making a compelling pitch; generic presentations never work. Research their interests, whether they are focused on technology, sustainability, or community impact, and customise your approach. By highlighting how your business aligns with their objectives and helps them achieve their goals, you will create a stronger connection. If you have an investment banker, work with them to craft a compelling story, highlighting the company’s origins, challenges overcome, growth strategy, governance, and ability to collaborate with external partners.

Start small, but do not stay small. By adopting these strategies, MSMEs can navigate the funding maze with greater confidence, turning challenges into opportunities. Building that trust through transparency, relationships, and strategic alignment can unlock the capital needed to fuel the Caribbean’s next wave of innovation.