Author of The Art of Startup Fundraising & Serial Entrepreneur, Startup founders are most often consumed with mastering investor meetings by having all the right answers. These are questions like: How did you come up with this idea? If they won’t lead you are are probably going to be circling back later anyway. Where did the CEO work before joining this company? In a question such as this, there is an opportunity to demonstrate professional knowledge and awareness. If the number seems high, ask them why they think that is. Make the ask. If you accepted their check, who would they want to see on the board? In other words “what are the odds this date is going somewhere?” It can also help you get a better perspective on the number of no’s you can expect before getting the checks you crave. How are shares split? Who are your biggest competitors? Let your financial profes-sional know you’re taking notes. © 2020 Forbes Media LLC. Here’s what you should be quizzing them with…. Due diligence is typically hell. By Springboard Enterprises @SpringboardEnt. Typically, these are established at the time of the financing; so you have the basis for which to compare your actual performance. Is there an existing board or advisors? Are the services bundled or can I select among them? The first thing is that you will show a high level of sophistication towards the VC. Here you will be able to learn how these founders did it and what kind of questions or concerns they had when engaging with potential investors. With a foreword by ‘Shark Tank‘ star Barbara Corcoran, and published by John Wiley &…. What is your employee turnover rate? If, they aren’t demanding board seat, who are the names they’d like you to get on there? Top 10 Questions Investors Ask During Fundraising Try this test to see if it's the right time to pursue investment money. However, asking questions, and good questions says a lot about you too. The second is being able to ask the entrepreneur how the investor behaved during tough times. #9 : What if three or five years down the road we think you’re not the right person to continue running this company—how will you address that? I am a serial entrepreneur and the author of the The Art of Startup Fundraising. 10) What Do You Expect This Investment to do for Your Portfolio? Though if they are a fit, then it’s far more efficient to get more money from the same source, than starting from scratch again. This information is intended as a general guide to the investor contemplating an investment in a "private company or project". This is especially true when it comes to investing success.Here are the five questions successful investors ask … You may opt-out by. Opinions expressed by Forbes Contributors are their own. Business leaders can ask themselves these questions to get a different take on how purpose and people are seen in their own organizations and to examine their own motivations and practices. Ten Top Earnings-Call Questions ... An analysis of second-quarter earnings releases by the Corporate Executive Board’s Investor Relations Roundtable showed that while 64 percent of S&P 500 companies provided guidance, only a third of those were doing so on a quarterly basis. The book offers a step-by-step guide to today‘s way of raising money for entrepreneurs. These questions are crucial to your pitch and will influence an investor’s decision. 5. Raising money is far more about the added value you can get with these people on your team and with a vested interest in your success than the funding itself. 2. 5 questions for Thierry Huon - VP Finance Head of Investor Relations Financial results interview The RENAULT Group presented H1 Financial results on 30 July 2015, and we wanted to take this opportunity to ask five questions to our VP Finance Head of Investor Relations to have a "digest" feedback for our blog readers. Questions to Ask Investor Relations Reps at the Companies, Characteristics of a Successful Penny Stock Trader, How Expectations Drive Penny Stock Prices, How to Identify Poor Quality Penny Stock Companies. What Is the Current State of Your Fund? That’s not a bad thing. A simple return is obvious. How much of a stock option pool is being set aside for employees? Ideally, people investing for retirement always should have been able to feel confident that their financial advisors were giving them unbiased advice and recommending what was best for them. What are the biggest risks and threats to the company? Questions to Ask as an Investor. Why did you decide to (some marketing, product, or financial decision in the pitch)? If the insider works in investor relations, and talks to investors as part of his job, and helps you with your earnings model: no jail, even if you talk … What is the status of your fund? It is used as an ice breaker, gets you talking about something comfortable, but you need to have something prepared for a response. Know whether the process is taking abnormally long or not. This is a question … How Do You Choose Your Investments? Why did she leave that position for this one? How does that compare to three years ago? Name someone you chose not to include as a … I have the pleasure of interviewing some of the most successful entrepreneurs on the DealMakers Podcast. Of course, each investor’s decision-making process is unique. In summary, use these questions to ask investors to ace your next meeting and speed your startup along to the funding it needs. Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400M (see it here). 3) How Often Should We Expect to Meet After Funding? They may have really bad term sheets that no one accepts. However, you don’t want it to sound memorized. Of that, what is your company’s market share? If it’s not a fit, who do they think would be the right fit. How and how often will the firm communicate activities to me? How much burn will occur until the comp… How does that compare to three years ago? You may have different needs and goals at the next series. 13) What’s the First Thing You’d Want Us to Do After Closing? 1. This is typically helpful if you land a VC that has enough capital to continue investing in your next financings as this will save you a lot of time from not having to do future roadshows. 4. Startup founders are most often consumed with mastering investor meetings by having all the right answers. The second question your investors can ask is how the business is performing. Or turn them down. With a foreword by ‘Shark Tank‘ star Barbara Corcoran, and published by John Wiley & Sons, the book was named one of the best books for entrepreneurs. 20) Could you introduce me to an entrepreneur of your portfolio that failed? At a minimum, you’ll go in sounding smarter and more prepared. What is the company’s growth rate in terms of sales? Who are your investors so far? They’ll know you’re a serious investor and may tell you more. 15 Questions to Ask Management Teams Whether or not you should meet with a company's management team is a debatable topic among fundamental investors. Most recently, I built and exited CoFoundersLab which is one of the largest communities of founders online. Look for a firm with deep experience across the board , not just one side of the Street. Peter Leeds is a highly respected authority on penny stocks who has been quoted in major media outlets and published in Forbes and Business Excellence Magazine. Angel investors are looking for a return on their investment, the company’s current financial situation, and proposed future burn rate. As for transparency, says Rob Binns, former VP of Investor Relations at Hewlett-Packard, who now serves as CFO and VP of HP Software, it is “critical.” “In our case, management is executing on a five-year turnaround plan….and helping investors understand what the milestones are and what they can reasonably expect along the way is incredibly valuable.” It summarizes key questions to ask and issues to deal with before investing. What are they going to get out of this? Investor Tip. Here are the top 100 questions you should be ready to get hit with. Do you arrange investor meetings and calls directly, or coordinate with third parties? Are you really talking to a decision maker? Jennifer Bargrove, principal consultant at VMA Executive, says that as IR recruitment is relatively infrequent, internal HR managers might not have expert knowledge of the role. 6) Who Else Would Be Interested in Funding This? For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. Are You Willing to Lead a Financing Round? That’s not a bad thing. Every investor is a little different. Some other questions are indications of interest that follow from what you’re presenting. Top 10 investor relations interview questions with answers In this file, you can ref interview materials for investor relations such as, investor relations situational interview, investor relations behavioral interview, investor relations phone interview, investor relations interview thank you letter, investor relations interview tips … 11) What Has Made the Biggest Difference Among Your Successful Investments? 6. What are the primary sales drivers for this company? Tell me about yourself. 30 Public Relations Interview Questions to prepare for The best way to prepare for an interview is to make sure you know how you will answer the questions that are likely to come your way. SurveyMonkey’s mission is to power curious individuals and organizations to measure, benchmark and act on the opinions that drive success. Get it out in the open and get the chance to squash their objections on the spot instead of leaving them the chance to give you a ‘soft no’. Ask your potential investors what they expect and what they plan to do to increase the value of your company. You do want a good amount of interaction. A question that prompts the manager to speak about the emerging competitors in the industry in which the company operates will let the investor know who … Often, interviewers will ask questions to find out the level of technical knowledge As Investor Relations that a candidate has concerning the duties of a care assistant. What unique skills and talents does each owner contribute? 20 Questions Entrepreneurs Should Ask Investors 1) What Percentage of Your Meetings Lead to Term Sheets? Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400M (, EY & Citi On The Importance Of Resilience And Innovation, Impact 50: Investors Seeking Profit — And Pushing For Change, Michigan Economic Development Corporation BrandVoice. What Other Investments Do You Have? Where is the company registered? Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash. I have been involved with the JOBS Act since inception and was invited to the White House and the US House of Representatives to provide my stands on the new regulatory changes concerning fundraising online. Even more important than landing a big check or big name investor is making sure you are choosing the right investor for you venture, at this stage, and for where you want to go next. Know if this is within your runway. Here are the, For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (, ) that I recently covered. Know and you can deliver. To get the best in your corner (and their money), as well as kicking off the relationship right, here’s the top questions entrepreneurs should be asking investors. Know the process and worst pains so they aren’t a surprise later on. Acing investor meetings and landing that funding is as much about the questions you ask, as the answer you have to what investors will grill you with. Who is their fantasy board lineup? This is an introduction to key performance indicators and other non-financial metrics that are going to affect the growth of your business. How Involved Will You Be … Without a lead you are really nowhere. The questions you ask have a major affect on how successful you become. Getty Images. This will give you an idea if they are meeting with you to invest or if they are fundraising and looking to use you as leverage during their fundraising efforts to show their own investors their pipeline of deal flow. Even if you come out without a funding commitment you’ll have learned a lot and have some better leads and data to supercharge your next pitch. Or are they patient investors looking for a very long term investment, like a family office? Who handles accounting? Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash. What Are Your Terms? How much more money will you need to raise to keep operations going? Prior to CoFoundersLab, I worked as a lawyer at King & Spalding where I was involved in one of the biggest investment arbitration cases in history ($113 billion at stake). Yet, you don’t want to be weighed down and held back from actually gaining and delivering results. The impetus to change doesn’t have to come from investors only. What percentage of customers stop using your product? 1) What Percentage of Your Meetings Lead to Term Sheets? What are the key assumptions underlying your projections? How is the company currently organized? Those against meeting with management believe you can get what you need from the numbers and company filings. To get the most out of your brief call, you need to ask the right kinds of questions, such as the following: How large is the potential market for your product? His popular Peter Leeds Stock Picks newsletter, available at www.peterleeds.com, has sold more than 42,000 subscriptions. Get a figure and keep the ball moving in the right direction. Who holds which titles? Their nephew or someone else internally? To ‘make the cut’ entrepreneurs must be prepared to articulate and answer the following questions. 5) How Many Follow Up Investments Have You Made? SurveyMonkey Investor Relations. Three years? Under what circumstances has the firm been disengaged? How much equity and debt has the company raised; what is the capitalization structure? While this is certainly not an exhaustive list of the important questions to ask when investing, is meant to demonstrate the difference in the mindset of successful investors compared to most retail investors. Where do you see this company in a year? Questions an Investor Should Ask . You may not always want a follow up investment from the same investor. Don’t leave this meeting without a lead on another investor or source of funding.