6 Smart Tips For Entrepreneurs To Build Strong Relationships With Investors!
Summary: When adequate
funds are the only thing that is stopping your startup from becoming
successful, you might want to think about establishing good relationships with
your investors.
Entrepreneurs put
in their immense effort and hard work in pitching their business idea to angel
investors to bring them on board because the key to success for most startups
is having funds for the growth of their business.
However, a deal is
never done when it comes to dealing with investors. If you have wooed your
investors once, it does not mean you won’t need them again in the future.
Investors with their lots of experience can offer incredible insight and
resources that can get your startup business on the right track.
According to
experts, nearly one-third of the startups shut down because of
a lack of planning about the proper usage of their funds. This leads to
investors losing interest and credibility in their business venture at the very
early stage. Many entrepreneurs often hire a business coach to help them
navigate the rough waters of the business world.
Managing investor
relations can make a huge difference to your business. As an entrepreneur, it
is your responsibility to strengthen ties with investors to position your
current business for success. While a strong relationship can help the startup
to grow rapidly, one wrong move can end the game for you.
Therefore, it is
highly essential for you to maintain a working, productive, and winning
relationship with your investors, even if they are not friendly.
Here are six pointers
that will help you to build a strong and cordial relationship with your angel
investors:
1. Don’t Choose Investors Solely for Financial Purpose
Investors can
provide not just funds, but also their valuable guidance and experience to
accelerate your business. Acknowledge the relationships and expertise investors
will bring to your business by giving them a voice. Listen to their underlying
apprehensions and concerns. Encourage open conversation and clear dialogue so
that you can learn more about their risk-taking appetite. You can consult with
a business
coach as well to understand how you can maintain dynamics with your
investors.
2. Set Clear Expectations in the Beginning
An entrepreneur
and investors need to be on the same page as nobody likes surprises in the
business. Thus, it is vital to set the goals, nature of the relationship,
degree of control, vision, the scale of growth, and exit strategy that is
acceptable to both parties.
3. Be Authentic & Respectful
Investing in any
firm is not a matter of a “fund it and forget it” scenario for any investor. In
fact, they would like to stay updated with the latest ongoing in your
organization. And when you are looking to strengthen your relationship with
investors, it should be rooted in authenticity and respect. lAs entrepreneurs
are coming into the market with their ideas, they should also respect their
investors` opinions, suggestions, and feedback.
Despite the
disagreements, they must behave respectfully towards each other. Discussions should
happen openly to arrive at a mutually acceptable solution.
To gain investors'
trust, startups must engage with them regularly, instead of treating them as an
obstruction that needs to be dealt with.
4. Share Challenges & Achievements With Investors
Every investor
wants to stay updated about the current progress of the venture he has invested
in. Hence, update your investors regularly with the latest figures, and charts
prepared by the startup team weekly or monthly, if not daily.
Also, be transparent
with your investors. Even when there are failures or mistakes, be forthright
with your angel investors. Keeping your communication channel open with your
investors helps you build a positive image of the startup.
5. Pay Respectful Towards your Investor`s Input
Investors can
guide your startup business with their expertise and insights gained from years
of experience in the market. You don't have to agree or incorporate every
suggestion, but paying heed and valuing them will give your investors a sense
of involvement and validation.
6. Address their Concerns
Investors might
have concerns about your plans, strategies, or any other aspect of the
business. You should make a conscious effort to address those concerns through
open discussion, dialogue, and reasoning.
As founders seeking capital quickly learn, finding
the right investor is often all about who you know.
If you are facing the biggest challenges from your
investors, we can provide you with amazing solutions with our business coaching program. You can
learn from the top industry experts how to take your business ahead in the
market. Kick start your entrepreneurial journey by clicking here: www.badabusiness.com
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