How do I work with investors?

Like any kind of business relationship, you will have to balance professional diligence with good communication skills if you are to get the most out of your link-up with an investor.



It’s crucial that you draw up a contract that clearly defines the investor’s role in your business. Some investors like to have a very hands-on approach while others would rather let you run the business and receive monthly accounts and financial forecasts.


Think carefully about the type of input you’d like your investor to have. If there’s a particular skill or expertise possessed by your investor, you may want more involvement in these areas than all other aspects of the business.

In the contract, set out what information the investor will want and how often. Ascertain whether your investor will want to be involved in areas such as senior hires or pay reviews.


Whatever the arrangement, make sure you provide timely, accurate information to your investor. Make sure you are honest about anything that has gone wrong and be clear about the goals that initially prompted the investor to part with their money. Talk to them over the phone or face-to-face rather than just on email – it’ll help build the relationship.


An investor will want to be confident that their outlay is in the hands of someone competent and flexible. They will want you to take their advice on board. This doesn’t mean you have to say “yes sir” to everything they suggest, but they will require that you can accept their guidance.


Above all, of course, they will want you to hit your numbers. If you can do this, a slightly underdeveloped relationship can be tolerated but it will mean that you aren’t getting the most out of your investor.


Finally, don’t be afraid to stand up to an investor. Incessant meddling in your business and the questioning of every decision isn’t constructive and should be challenged, especially if it’s in breach of your initial contract.


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