8 things investors want to see in you

Your startup is running well, generating revenue and demonstrably solving a real problem. Now it's time for the next step: raising external funding to accelerate your growth. But in the competitive growth capital market, investors are critical and look beyond initial results. They look for clear indicators that underscore your startup's potential. Therefore, in this blog we list all the things you need to have in place so that you know exactly what you need to work on to attract investors.

Investors differ from one another. Some base their decision solely on hard data, while others value more the click with you and your team. Also, not all investors take equal risks. Some focus on proven concepts, while others dare to bet on early innovations. Despite these differences, there are universal criteria that almost every professional investor looks for. Do you meet these? Then your business plan is probably investor ready and you stand a serious chance of coming to the table with investors. Select carefully which type of investor suits you. Good preparation will ensure 90% of your success.

Investors primarily judge the team behind the startup. A strong and motivated team is often more decisive than your idea or your product. Simply because even the best idea fails without the right people to execute it. What makes a team strong? It starts with complete dedication, of course. Funders want to see that you and your team are doing everything possible to grow the startup. They also look for teams with a broad mix of relevant competencies, where roles and personalities complement and reinforce each other. The ability to work together under high pressure and make the right decisions is also a factor in getting to the table with investors.

So what sets your startup apart is not the idea, but the team's ability to successfully market the idea. Investors want to see that you solve a problem that really needs to be solved. So: know who your customers are, what they are up against with current solutions and how your solution addresses that. By demonstrating that you have validated the problem and how you have done so, you reduce the risk of failure and increase your chances of getting external funding.

In other words, there must be a recognizable need in the market for which your startup offers a distinctive solution. After all, market potential is directly related to your company's potential growth, revenue and profitability. Hence, investors carefully consider whether the market and potential are large enough to realize a nice return. For your startup, it is therefore essential not only to name the market potential, but also to back it up with solid market analysis and expectations. Make concrete how big the market is in the Netherlands and/or Europe, and what share is realistically achievable.

Traction is evidence of market demand. Has your startup already gathered launching customers or letters of intent? It shows that your business model works and increases investor confidence.

Investors don't like surprises. That's why they want to be provided with accurate and timely information, such as insight into your business plan and financial figures. The more detail and substantiation, the better. Be proactive and careful about this. Work out different scenarios: not only your optimistic growth path, but also what you will do if things go unexpectedly wrong. Also make clear how much funding you need, what share you are willing to give away, and why. It shows that you have realistic expectations, and that gives investors confidence. Moreover, it can speed up the investment process because you already have a lot of important information ready.

No one knows everything. That's why it's smart to invest in mentoring as a startup. Regular feedback from a mentor helps you avoid pitfalls and better weigh decisions. In addition to providing knowledge and experience, a mentor often opens the door to networks that are otherwise hard to reach. For example, mentors can introduce you directly to investors or use their network to bring your startup to the attention of potential customers or partners. For investors, mentoring is a strong signal that you have self-insight and a willingness to learn, traits that are crucial to success.

Do you recognize your startup in these seven criteria? Then you have a solid foundation on which to approach investors. Do you still need some support in making your business plan investor-ready? The NOM Investor Readiness Program helps ambitious founders successfully attract investors: from understanding the investment landscape to finding the right match with a potential investor.