Why Investors May Not Be Interested In Your Business

Updated: Apr 30, 2021

Investment in Business Blog Post

I have had the pleasure in the past of participating in forums where start-ups presented to Angel Investors a few years ago. Since I am a massive fan of the Dragon’s Den, it was like a mini-version of the program but more upfront and personal.

Since one of our services is writing business plans and working with small business owners to introduce lenders and investors, participating in these events was a great exercise. I would listen to the owner's presentations and then try to figure out why one company would hold interest for investors and another one would not. It is hard when you see how much the founder believes in the business and is passionate about what he/she is presenting. They then wonder why investors are not flocking to them. Since that time I have been asked my thoughts concerning investors and what they are looking for in an investment. I thought I would share this hoping it might help an entrepreneur seeking investment in tightening up their story/plan before approaching an investor.

These tips have been developed through my work with the financial community. Remember to keep in mind that approximately only 1 in 10 start-ups succeed and that investors are looking for that 1, not the other 9.

10 Tips to Consider Before Looking for Investment

  • Before you present, keep in mind you must understand your product. If you cannot convey your product to the investor so that they are able to see the value, you will lose their interest quickly.

  • You need to translate the engineer speak to market speak and then market-speak into profitability speak.

  • Know your market, the size of the market, your competition, and be able to articulate how much of that market you think is feasible for your company to address over the next 3-5 years.

  • It helps to look for investors that understand your market and industry. Asking someone focused on retail to invest in a bio-med or cloud computing product is probably a stretch. If you look at Angel or Venture Capital sites, most list the industries that they focus.

  • Before you ask an investor to put their hard-earned money into your company, make sure that you have a