Founders should prepare to pitch a business idea and be ready to answer relevant investor questions.
If you fail in these areas, it is unlikely for you to obtain funding sources.
Below you can see some key questions investors ask during your meeting.
All founders need an understanding of this information.
The Core Elements Of Every Investor Meeting
When seeking investment for a startup, founders should be ready to answer questions about the core elements of their business.
The most crucial aspect for investors is the team.
They will want to know if the founders are trustworthy and capable of executing their plans and if they have relevant experience.
The market size is also essential; investors will want to know if there is potential for high returns on their investment.
They will also assess the product, looking for evidence of a product-market fit and assessing the level of innovation.
Finally, financials are crucial; investors will want to see that the founders understand their numbers and are in control of their finances.
By being prepared to answer questions about these core elements, founders can increase their chances of securing investment.
Investor Questions about: TEAM
- 1What is the founder's background?
- 2What unique skills and talents does each founder contribute?
- 3What are the roles and responsibilities of each founder?
- 4Do you have any prior experience in this field?
- 5Did the founders work together in the past?
- 6Does anybody with startup experience?
- 7Who are key team members?
- 8Where are your offices?
- 9How many employees do you have?
- 10Are there any board members or notable advisors?
- 11What additional roles do you foresee that might be necessary for the foreseeable future?
- 12What makes you the right person to lead this startup?
- 13What keeps you motivated as a founder?
- 14Are any of the founders thinking of retiring soon?
- 15Is there a reverse vesting agreement between the founders?
- 16Do you have a non-compete agreement with your current/previous employers?
- 17What are the biggest challenges that your team is facing right now?
- 18Can you share your Org Chart?
- 19Who are your contractors?
- 20Which consultants do you use?
- 21Are any of the founders related?
- 22Do any of the founders have side projects?
- 23What other companies or organizations do you have a role in?
- 24Do you have any personal guarantees on debts
- 25Who in this organization is most replaceable?
Investor Questions About: MARKET
- 26What is your total addressable market (TAM)?
- 27What is your serviceable available market (SAM)?
- 28What is your serviceable obtainable market (SOM)?
- 29What market share would you like to achieve?
- 30Who is your ideal customer?
- 31How do you plan to penetrate your target market?
- 32How long would it take to gain a significant market share?
- 33Why is this the right time for this product or service?
- 34What are the main trends affecting your industry?
- 35How many competitors do you have?
- 36What is the competitive landscape?
- 37Name the 3 most significant competitors
- 38What differentiate you from your competitors?
- 39What are the drawbacks or hurdles you are facing?
- 40Do you have any economy moats or barriers to entry?
- 41Where does the competition fail?
- 42Is your market share bigger than your competitors?
- 43Is your pricing model different?
- 44What are the critical success factors in this industry?
- 45What are the main KPIs your team is measuring?
- 46Which specific marketing channels are you using?
- 47Why are you using these marketing channels?
- 48How are you marketing your product or services?
- 49What are your primary marketing activities?
- 50What is your go-to-market strategy?
- 51How long will it take you to break even?
- 52What is your plan B if these sales channels are interrupted?
- 53What profit margins are you operating on?
- 54How will scale impact profit margins?
- 55What pivots have you already made up until now?
- 56What other streams of revenue can be added to your business?
- 57How many paying customers do you have?
- 58What is your CAC (Customer Acquisition Costs)?
- 59What is your LTV? (customer lifetime value)
- 60What is your revenue model?
- 61How do you measure growth?
- 62How much did you grow in the past 12 months?
- 63How much did you grow in the last quarter?
- 64What are the 3 main reasons that hold your growth even faster?
- 65Do you have a demo to present?
- 66What is your retention rate?
- 67What is the typical feedback you get from customers?
- 68Did you consider the feedback? If so, in what way?
- 69Do you have any viral growth components in place?
- 70Did you get any media coverage? By whom?
- 71Do you have any testimonials or reviews from customers?
- 72Do you offer a free trial?
Investor Questions About: PRODUCT
- 73Why is your product unique?
- 74What pain does it solve?
- 75What is the development status of your product?
- 76Is it ready for launch?
- 77What are the next steps in terms of development?
- 78What is the roadmap for your product?
- 79What is your product development process?
- 80What features are currently available?
- 81Are there any inherent legal exposures while using the product?
- 82Are there any potential risks to customers?
- 83Do you need to comply with specific regulations?
- 84Did you file for patents? What is the current status?
- 85Who is your IP attorney?
- 86Who is the owner of your IP?
- 87Are there any prior employees or founders who may challenge these rights?
- 88Any future patent filing plan?
- 89Did you sign any former employee or contractor on the IP Right Transfer agreement?
- 90What unique features are you working on?
Investor Questions About: FINANCIALS
- 91What is the company's incorporation structure?
- 92Where was the company incorporated?
- 93Do you have any subsidiaries?
- 94In which countries do you operate?
- 95Do you have any employees there?
- 96Who are the key shareholders?
- 97What are the current holdings of the founders?
- 98Are there existing board members or advisors?
- 99Who handles your accounting and payroll?
- 100Who is your auditor?
- 101Who handles your legal matters?
- 102Who participated in earlier rounds? any lead investors?
- 103How much equity and debt was raised so far?
- 104What is the round's pre-money valuation?
- 105how did you get to this number?
- 106How much would you like to raise?
- 107How did you get to this number?
- 108What is your current burn rate?
- 109What is your current financial runway?
- 110What was the previous pre-money valuation? when was it?
- 111What was your previous investment amount?
- 112What is your exit strategy?
- 113What is the expected timeline for the exit?
- 114Will current investors take part in this round?
- 115What do you expect from your investors?
- 116What other offers have you received?
- 117What are the terms of those offers?
- 118What is the expected time frame to close this round?
- 119Who else have you spoken to about this deal?
- 120When will they make a decision?
- 121Have you ever done dilutive financing round before?
- 122What was the reaction of your shareholders to that event?
- 123Can you introduce me to your lead investor?
- 124Do you have an ESOP in place?
- 125What is the current pool percentage out of the total number of shares?
Use of Proceeds
- 126How are you going to use the round funds?
- 127How will this round extend your current runway?
- 128What is the next big goal you plan to achieve?
- 129Do you plan any salary raises?
- 130What is the budget breakdown between R&D, S&M, and G&A?
- 131Do you have a plan B in case you won't succeed raising the full amount?
- 132Do you plan any CAPEX investments?
- 133Did you try other forms of financing?
- 134Did you raise funding from F&F?
- 135Did you put your own money into the company?
- 136Do you use investment bankers? finders?
- 137Is there anything else you would like to share with us?