How to get investor ready

If you’re serious about being successful at fundraising for your small business and doing so in an efficient time frame, you’ll find the content of this superguide highly valuable.

Because this is such a time-consuming, potentially costly and often stressful experience for many investment-reliant businesses, we turned to Farillio’s favourite expert on investment strategy, our own board adviser, Duet Partner’s John Hall, for help in creating this guide and it’s supporting materials. John has helped us and a number of our fellow community businesses with successful fundraising.

The following ‘ingredients’ are covered in this guide:

1. What investors look for and how to ensure you can deliver what they most want and get excited by

2. Our investor ready checklist, covering, for example:

• how to evaluate and present clearly your problem/solution fit

• understanding and presenting clearly your product/market fit

• evaluating and describing clearly your route to market

• presenting and rationalising your business model

3. Your investor-appropriate business plan, accommodating your position on many of the above components

4. Your customer development journey in graphic (and pitch-supportive) format

5. A good financial model for your business

6. A credible valuation for your business

7. A compelling pitch deck that will give you and your investor audience confidence when you present it

8. A compelling business plan/information memorandum (if needed to accompany your pitch materials – which later stage fundraising businesses are likely to need)

9. Building/evolving your share capital table (cap table) for your business

10. Your application for SEIS/EIS tax incentives to offer to your investor targets – many of whom will expect to be offered them

11. The relevant notification(s) to your existing shareholders about your fundraising intentions

12. A record/log capturing all your interactions with investors, as well as key details on their backgrounds and how to evaluate whether now is a good time to target them for funds

13. Your ‘on the day of the pitch’ checklist

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How you prepare for investment matters. Some of that prep-work will depend on whether you’ve raised funds before, how much you’re targeting to raise and who you’re targeting as your ideal investors.

However, every fundraise you undertake should be treated as a stand-alone event, not simply a re-purposing of something you might have produced and presented before.

There are some fundamental principles applicable to all businesses looking to raise funding from external sources on any occasion, and how well you’ve addressed these will have a significant bearing on your prospects of success.

John shares his overarching insights into how to prepare for investment and what investors want to see in the video below.

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John's also created a fantastic guide on Duet Partner's website called 'Founders should take this test before seeking investment'. In this guide, John talks expertly about the need to ensure your vision for the business is really solid, and that you've got a clear sense of all the key ingredients of your fundraise story. We highly recommend it.

Being prepared and going into fundraise activity with well-informed expectations will make all the difference to your experience of it, as well as how well you perform under the pressure and scrutiny that comes with investor discussions.

We’d also recommend that you read Farillio’s interview with seasoned, portfolio investor and finance sector expert, Tarne Bevan, who provides additional helpful insights and advice about what you’ll need to show, why investors set such emphasis on these data and whether giving away shares (and a slice of ownership in your business) is a good option vs other funding possibilities.

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This is one of the most valuable resources you can use at the start of any fundraise activity – whether it’s your first time fundraising or you’re becoming a seasoned fundraiser for your business.

In the video snippet below, John narrates Farillio’s investor-ready checklist and provides his insights on what you should expect to have in place already to be considered a credible, reassuring and exciting investment prospect for any investor before you embark on fundraise activity.

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