Securing the support of multiple investors can be a big boost to a business just getting off the ground. While the guidance and funding these investors offer are critical to building a successful business, entrepreneurs must also become adept at balancing competing feedback and expectations.
To create truly positive relationships with investors, it's key that entrepreneurs put processes in place to ensure all sides are aligned, have space to communicate openly and are dedicated to working toward common goals before accepting any funds. Below, 14 Newsweek Expert Forum members each offer one piece of advice to help entrepreneurs ensure that their investors feel heard and happy with how things are progressing.
1. Seek Knowledgeable Investors
The need for investment can sometimes overshadow the importance of selecting an appropriate investor. Smart money is always preferred from an investor. Like all relationships, seek savvy investors that are familiar with the business, management and stakeholders to ensure aligned expectations. A respectful and resilient relationship requires all parties to work together toward a common aim. - Gene Olinger, MRIGlobal
2. Identify Their Expectations
Reach out to all the investors and say, "What's most important to us is that all of you have investor's delight instead of investor's regret." Invite them to share with you the top things you must do and be for the investors to feel the former and not the latter. Communicate that you will anonymously share the results and what you plan to do going forward to accomplish that. Remember to thank them for believing in you. - Mark Goulston, Mark Goulston, M.D., Inc.
3. Determine How Success Is Defined
Clearly define and document the definition of success for each investor before the engagement begins. Unstated expectations will always go unmet. Conflicts often arise from a lack of clarity. Ask for their definitions and then publish a plan of record to make measures of success visible to various investors. In times of uncertainty or conflict, return to the plan. Remember to also regularly revisit and adjust these metrics. - Karen Mangia, The Engineered Innovation Group
4. Establish Open Communication
Establish transparent communication by regularly updating all investors on company progress, challenges and decisions. Encourage feedback, host collective meetings to foster collaboration and address concerns promptly. While it's impossible to please everyone, building trust through transparency ensures investors feel valued and involved. - Bala Sathyanarayanan, GREIF Inc.
5. Be Transparent
Transparency is the key to maintaining a balanced relationship with all your investors. This means keeping investors informed throughout the process, expediting consensus and ensuring all voices are heard during decision-making processes. Always try to be as clear and concise as possible with them, as fostering trust and open communication leads to stronger partnerships. - Steve Smith, Zayo
6. Actively Listen
Actively listening to your investors is a way to establish open and transparent communication and trust. By actively listening, you acknowledge their opinions and emphasize their visions. Regular updates, structured decision making and mediation when needed can help ensure all investors feel heard and satisfied with the company's progress. - Adi Segal, Hapi
7. Provide Regular Communications
Keeping stakeholders and investors excited and well-informed about business ventures is crucial for maintaining their support and trust. To keep multiple investors engaged, provide regular communications and detailed reports that are tailored to the needs of each stakeholder. Make each investor feel heard with special attention through impactful storytelling about customers and growth projections. - Lillian Gregory, The 4D Unicorn LLC
8. Focus on Common Goals
All investors have the same goal, only different ideas for getting there. Focus on the commonalities and common objectives, and be open to examining different approaches. Build consensus on the business goals and strategies first. Then ideas and details can be evaluated through the lens of strategy rather than only opinions. - Krista Neher, Boot Camp Digital
9. Prioritize Consistency
Managing multiple investors is akin to a balancing act. My key advice is to prioritize consistency and routine. By establishing regular communication channels, every investor will feel included. While opinions may differ, the consistent approach ensures all voices are heard and valued. Consistency is the bridge to harmonious collaboration. - Ian Wilding, Hangar 75
10. Be Proactive About Feedback
The most important factor is open communication and being proactive to accommodate investors' insecurities and suggestions. Offer weekly or bi-weekly updates, as well as reports on sales, losses and methods of improvement. Hold individual meetings for those investors that are concerned or have insecurities. - Tammy Sons, Tn Nursery
11. Set Regular Meetings
Prioritize open communication and transparency. Establish regular meetings to keep everyone on the same page, and encourage investors to voice their concerns and ideas. By proactively addressing matters through data-driven analyses and well-reasoned arguments, everyone can better understand the bigger picture and put contentious details into perspective, fostering a collaborative environment. - Umang Modi, TIAG, Inc.
12. Review Personalities and Communication Needs
You need to avoid dealing with problematic and headache-inducing investors. Make sure that each personality blends well with others. Your investors are all different people and groups with different motivations. Some will want quick profit and to follow up with you too often while others will have a longer time frame and might just talk to you occasionally. Try to get feedback in advance before taking them on. - Zain Jaffer, Zain Ventures
13. Be Empathetic of Different Perspectives
Always be empathizing! Every investor has unique experiences and goals that inform their investment path. You'll never get everyone on the same page without putting yourself in their shoes and understanding their motivations and pains. The key to collaboration is acknowledging and respecting their differences and constantly seeking out common ground. - Gergo Vari, Lensa
14. Hold 'Harmony Roundtables'
Drawing from group therapy principles, you can consider holding "Harmony Roundtables" or structured meetings where each potential investor is given an equal amount of time to voice their vision and concerns without interruptions. You can then post all of their contributions on a "Harmony Board," with the objective of encouraging them to find synergies and patterns, not differences. - Dr. Kira Graves, Kira Graves Consulting
Uncommon Knowledge
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
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