in

How To Identify The Right Investor For Your Business Idea

Here are five things you could look for in an investor you might choose to work with: 

Connectedness in the Industry. A lot of investors will tell you that they can help you with introductions and connections in either product development, distribution or sales.  But can they? Unless they have strong industry connections, at best, their introductions will be based on their network, not direct connections who might have a key impact.

Product or Industry Experience. You could look for an investor who has had actual experience in creating a similar product or service, therefore they might have a recipe for success. They will really understand your market and perhaps even the road you will have to travel to be successful. Their advice and counsel will be based on real experience. They will also provide insights on how not to make mistakes based on their own experience.

Coaching You Up. It’s one thing to have an investor who meets with you every month or quarterly to see how the business is going and it’s quite another to be coached by an investor on an as-needed basis.  This may be the most important attribute to look for in an investor. If you have never launched a startup before, there are a myriad of things that can go wrong that have nothing to do with the product or service. Learning how to make decisions, manage a diverse team, handle pressure and balance your life are all things a great coach can provide. 

Flat Out Helping You. While an investor is not an employee, they can be very helpful in timely situations. They can provide advice on things that are somewhat small in stature but critical. A quick meeting or phone call with them can resolve something very quickly and also give you that confidant who you are building trust with to reinforce the key decisions you are making. Be careful of investors who seem spread thin and just won’t be around to help when you need it the most. 

Committed to Your Success. While you would think any investor would be committed to your success, investors do a lot of deals. It’s the law of averages. Invest in 100 startups to get maybe four winners. You need to find the investor who is not too leveraged with all their deals but more importantly, is committed to your success both to you personally and to the startup. Ask yourself this question,” Would this investor still care about me if this startup fails?” If the answer is yes, then choose that investor.   

If you have a startup that is targeting a big market and a large or growing industry, and you have a solid solution to a problem, then odds are you will have an opportunity to choose from several investors. Take your time and choose wisely. Evaluate who can best help you achieve the goals of your startup and would be most likely to invest in your success. It’s not about choosing an investor “brand” name because you think that would be cool or give you credibility. While that might help initially, you really someone who will lean in with you and help you in ways you can’t even imagine yet.  

Loading...

What do you think?

0 points
Upvote Downvote

Written by nigeriahow

Leave a Reply

Your email address will not be published. Required fields are marked *

3 + 7 =

This site uses Akismet to reduce spam. Learn how your comment data is processed.

5 Business Ideas To Make Extra Cash During Festive Periods

10 Social Media Mistakes That Could Be Affecting Your Business