What investors look at first in a new project

Every investor has a personal way of choosing, but the first questions are nearly always the same. If your post and your first messages answer them, the conversation starts well.

1. The person behind the idea

An idea changes many times on the way. The person stays. Investors want to know who you are, what you have done before and why you are the right one for this project. Say it in a few honest lines.

2. How big the need is

Who will pay for this, and how many of them are there? You do not need a long study. A simple, believable estimate is enough: the kind of customer, the city or country, and roughly how many.

3. Any proof that it works

Something real is worth more than a promise:

• a first version that people can try,
• a few customers, even small ones,
• a letter or message from someone who wants to buy,
• results of a small test.

4. How the money comes back

How does the project earn money: sales, subscriptions, a commission? And how does the investor get a return: a share of the company, a share of the profit, repayment over time? Be clear about what you offer.

5. What the money is for

"We need USD 100,000" is not enough. Show the main lines: equipment, salaries, marketing, stock. An investor wants to see that you have thought about every dollar.

6. The risks, said openly

Every project has risks. If you name them yourself and say how you plan to deal with them, you gain trust. If you hide them, the investor will find them anyway, and stop trusting the rest.

Five questions to prepare before you write to an investor

1. What problem do you solve, in one sentence?
2. Why you, and why now?
3. What do you have today that is real?
4. How much do you need, and for what?
5. What do you offer in return?

If you can answer these five in two minutes, you are ready. Browse the posts on Sharksme to see how other members present their projects.

This article is general information. It is not financial advice.