Are we ready to face our investor’s questions? Is our new start-up ready for fundraising? Many of us struggle with this question as we develop our product, services and grow our business. Somewhere inside us we think that we should take this forward.
Pitching to investors is one of the most important and difficult tasks we ever face in building and growing our business. We diligently prepare ourselves to face the investor’s and answer their queries but many times despite our expertise we fail to comprehend and anticipate what kind of salvos will be fired at us in the form of questions. We should always bear this in mind, an investor is a person with whom we are going to have a long term dealing so integrity and honesty is absolutely essential and should be an important ingredient of our presentation.
These could be few of the questions which we may be asked by the investors and to be on the safer side, we (Entrepreneurs) should always be prepared with an appropriate response.
- Why should I believe you?
- Who believes you and how can I connect with them?
- What is your start-up all about?
- What problem does it solve? How big is the market?
- There are lot of business similar to yours, so how is yours different and why should I put my money on it?
- How much have you and others (if any) have invested in this? Have they got any return, has it started giving back, what is the turnover?
- Can I know more about your team? Are they trustworthy?
- Is this your first business or you have done before, if yes what happened to that?
- Can your business adopt “The change with time “policy?
- Any milestones achieved? Please share it.
- Do you have access to the various resources you need to launch or grow a business?
- How many specific benefits for your product or idea can you list?
- Can you get paying customers from your target market to pre-order based on a blueprint or mock-up?
- What will it take to break even or make a profit?
- How can investors in your idea make a profit?
The investor will want to scan your business to the minutest extent. His set of questions will never come to a halt. He would always want to know more for example – How much do you need and how will you utilize. Based on his assessment he would wish to take a call on the valuation of the company and finally if he would like to invest in your business or not. This final fire-shot may give us a feeling that he liked the presentation and the concept of this start-up and possibly interested in investing.
The final version what we hear could be “it was really nice meeting you, we will be surely looking into your idea and business, we liked it”. They will request you for another meeting to take the conversation forward. Or the version could be to the contrary ending with we are not ready to invest in your idea now. Maybe will look into this after some time, good luck!
Don’t worry and let this not dishearten you. Go to the next investor. Clean up what went wrong with the previous investor, sharpen your answers and eventually success with knock at your door. Persistence and belief in yourself is the key.
Please remember that at the end of the day, investors want to invest in leaders who are movers and shakers and have the ability to win in every situation.
I would love to hear your experience with investors. Please feel free to share it on the comments section below.
Originally Published at – BolteRaho
Follow me on twitter – https://twitter.com/ijeetujain
Recommended reads on the topic
99 Questions every investor will ask
How to get funded (summary of a funding event)
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asha chaudhry
hi jitender,
you seem to have gathered quite a lot of wisdom! just out of curiosity, how many investors have you met so far?
i’m adding these two links on your post as recommended reading on the subject. in case you haven’t read them so far, pls do!!
🙂
https://www.therodinhoods.com/forum/topics/99-questions-every-investor-will-ask-especially-a-vc
https://www.therodinhoods.com/forum/topics/how-to-get-funded-when-over-200-people-asked-in-unison
Jitender Bhandari
Hi Asha
Yes gathered lot of information.
As I’m based from Jorhat (Assam) so it is not possible for me to meet many investors, but I have done telephonic and electronic conversations with many.
Alok Rodinhood Kejriwal
Here are 2 REAL conversations I have had with my investors:
Circa -2001.
Place – Small sofa facing the piano in the Trident Lobby (Mumbai).
People present – Renuka Ramnath (CEO of ICICI Ventures), Bala Deshpande (ICICI Ventures), Gopala Krishnan (COO of c2w), Sushanto Mitra (c2w advisor), and me.
Situation – The 2001 dot com bust. contests2win.com had raised seed capital from ICICI and eVentures in 1999 and that money had, been used to build the teams, etc. Now in 2001, we had 6 months of cash left to survive. eVentures had closed down their operations. I was desperate. I knew I had a great idea and had to ride somehow survive this storm. The agenda was to beg Renuka for some more funding.
I began the conversation and rambled a bit on how great an idea c2w was and then told Renuka,“Ma’am, we need more money to survive.”
Renuka looked at me, smiled and said, “Alok, when we have children, they fall down sometimes when they begin walking. As parents, we can easily hold them, but we don’t. Allowing them to fall is what teaches them to walk.”
Renuka and Bala then left the meeting.
Lesson learnt – Fall. Stumble. Get hurt. But get strong! My team and I were shattered as we walked out. Yet something had been triggered inside.
We struggled, beat ourselves to death and survived. Almost 10 years later, we are miles ahead of those horrid times, and that advice remains unbelievably hard to beat.
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Circa –September 2010.
Place – The large conference room of Clearstone Venture Partners in their 4thstreet office in Santa Monica, California.
People present – Sumant Mandal (g2w board member and MD of Clearstone), Jim Armstrong (Joint MD of Clearstone), Bill Elkus (Founder of Clearstone) and me.
Situation– Presentation of the games2win business to the management of Clearstone.
I had drawn a large circle on the whiteboard – representing our business of g2w. Within the circle I started carving out areas (think pie charts) that defined the business lines of the Company. The carve-outs showed online games, portals, social games & virtual worlds. It quickly looked pretty crowded. Yet I had a marker in my hand to fill in new sections representing our forthcoming iStore games and Android games.
As my marker approached the circle once again, I was nervous. This was the classic ‘doing too many things’ syndrome. My marker touched the white board and just as another line began to appear, Jim Armstrong hollered at me in a rather stern voice and said, “Alok! Don’t tell me you have more offerings to explain to us?” I calmly said, “Yes Jim, we have these new lines rolling out as we speak and…” Before I could complete my sentence, Jim suddenly sat upright, broke into a big smile and exclaimed loudly, “That’s audacious Alok – and we love you for your audacity!!”
Lesson learnt – When you get the right partners, they encourage you for being yourself. In my case, for being a bold, brash entrepreneur.
Games2win couldn’t have been where it is today without Clearstone.
(g2w raised a follow on Series A investment from Clearstone in March 2011 and I earnestly hope that I can make them all proud when we exit.)
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From – https://www.therodinhoods.com/forum/topics/the-9-best-conversations-i-have-had-in-my-life-and-the-lessons-i-