YEC Members Offer Advice for Finding, Vetting and Learning From Investors

These resources originally came from a feature article on how to vet your investors in the Winter 2016 issue of YEC Quarterly Magazine. You can read further tips and stories from this issue and more here

 

7 Helpful Resources for Finding Competitors and Investors

CrunchBase: This is your No. 1 source of information on leading companies, founders, executives and investors.

LinkedIn: Find mutual connections on the largest professional networking service.

AngelList: This platform allows investors and job seekers to discover the most innovative startups.

Quora: Ask any question to a community of knowledgeable users or search its database for similar queries.

TechCrunch: This online publisher is your go-to resource for the latest news in the tech industry.

Onevest: Find reputable investors on this popular crowdfunding site for entrepreneurs.

Owler: Get everything from company profiles, news alerts, business data and more.

6 Signs of a Promising Investor

They have relevant experience. “Make sure they’ve done deals in the past and know how an investment works in your particular industry.” – Faraz Khan

They want you to succeed. “Do you feel like they have your back, or are you just a number on a spreadsheet?” – Tammy Leigh Kahn

They’re flexible. “The terms of the deal hopefully won’t change, but they need to be flexible in case certain things happen.” – Faraz Khan

They focus on helping you solve your problems. “When I call my investor, he sits down with me and drills specifically into the issue.” – Erik Severinghaus

They don’t micromanage. “You want someone who’s going to trust you and be an advisor — not someone who’s going to demand information when it’s not the right time. Gauge what they ask. Are they checking in or just asking for numbers?” – Faraz Khan

They’re reliable. “Anything that [my investor] says he’s going to do, I have tremendous faith that he’s going to do it.” – Erik Severinghaus

Must-Ask Questions for Your Investor

“Have you ever made an investment like this before? Was it successful, and if not, why?” – Faraz Khan

“How many more investments do you plan to make this year?” Ideally, they’re at the beginning of their funds so they can be lenient with deadlines. – Tammy Leigh Kahn

“Would I be comfortable getting a beer or having dinner with this person?” — Douglas Hutchings

“What’s your expected worst case scenario? What are you comfortable with?” Faraz Khan

“Are there any other firms I should be talking to?” – David Berry

“Do you have other current investments?” – Faraz Khan

 

This feature originally appeared in our Winter 2016 issue of YEC Quarterly, our print magazine for YEC members. If you’re a YEC member, feel free to download all previous issues of YEC Quarterly here.