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questions to ask investor relations

questions to ask investor relations

Acing investor meetings and landing that funding is as much about the questions you ask, as the answer you have to what investors will grill you with. Why did she leave that position for this one? How many employees do you have? To get the best in your corner (and their money), as well as kicking off the relationship right, here’s the top questions entrepreneurs should be asking investors. As for transparency, says Rob Binns, former VP of Investor Relations at Hewlett-Packard, who now serves as CFO and VP of HP Software, it is “critical.” “In our case, management is executing on a five-year turnaround plan….and helping investors understand what the milestones are and what they can reasonably expect along the way is incredibly valuable.” Look for a firm with deep experience across the board , not just one side of the Street. Those against meeting with management believe you can get what you need from the numbers and company filings. Investor relations requires a strong understanding of the language and terms used on Wall Street, the questions analysts ask, and the storylines that attract the attention of investors. I am a serial entrepreneur and the author of the The Art of Startup Fundraising. At a minimum, you’ll go in sounding smarter and more prepared. Peter Leeds is a highly respected authority on penny stocks who has been quoted in major media outlets and published in Forbes and Business Excellence Magazine. 11) What Has Made the Biggest Difference Among Your Successful Investments? 10 Questions to Ask Investors (Before You Take Their Money) 1. 10) What Do You Expect This Investment to do for Your Portfolio? 1. Get a figure and keep the ball moving in the right direction. Let your financial profes-sional know you’re taking notes. Five Questions to Ask Before You Invest Whether you’re a first-time investor or have been investing for many years, there are some basic questions you should always ask before you commit your hard-earned money to an investment. A question that prompts the manager to speak about the emerging competitors in the industry in which the company operates will let the investor know who … Who are your investors so far? With a foreword by ‘Shark Tank‘ star Barbara Corcoran, and published by John Wiley &…. The second is being able to ask the entrepreneur how the investor behaved during tough times. Or they may be so inefficient and tough in the process founders end up going elsewhere for their capital. How does that compare to three years ago? This is a question … Angel investors are looking for a return on their investment, the company’s current financial situation, and proposed future burn rate. What are they going to get out of this? Questions an Investor Should Ask . You may opt-out by. Yet, you don’t want to be weighed down and held back from actually gaining and delivering results. Of that, what is your company’s market share? It is used as an ice breaker, gets you talking about something comfortable, but you need to have something prepared for a response. Raising money is far more about the added value you can get with these people on your team and with a vested interest in your success than the funding itself. How much burn will occur until the comp… In other words “what are the odds this date is going... 2) What Percentage of Your Term Sheets Turn into Checks? You want to know if the fund has enough "dry powder", or money in their fund, to... 2. 14) How Long Does it Typically Take You to Close? There are six questions that investors will ask about you and your market opportunity before making an investment decision. There are two things that you will accomplish here. The second question your investors can ask is how the business is performing. With a foreword by ‘Shark Tank‘ star Barbara Corcoran, and published by John Wiley & Sons, the book was named one of the best books for entrepreneurs. Here are the top 100 questions you should be ready to get hit with. Tell me about yourself. These are questions like: How did you come up with this idea? A term sheet (or offer) alone isn’t a guarantee of a … Opinions expressed by Forbes Contributors are their own. If, they aren’t demanding board seat, who are the names they’d like you to get on there? How many employees do you have? 2) What Percentage of Your Term Sheets Turn into Checks? By Springboard Enterprises @SpringboardEnt. These questions are crucial to your pitch and will influence an investor’s decision. 6. Make the ask. How is the company currently organized? Investor Tip. That’s not a bad thing. To get the most out of your brief call, you need to ask the right kinds of questions, such as the following: How large is the potential market for your product? How much equity and debt has the company raised; what is the capitalization structure? You’ll set up more favorable negotiations. That’s not a bad thing. Where do you see this company in a year? Are you really talking to a decision maker? Know if this is within your runway. Top 10 investor relations interview questions with answers In this file, you can ref interview materials for investor relations such as, investor relations situational interview, investor relations behavioral interview, investor relations phone interview, investor relations interview thank you letter, investor relations interview tips … What percentage of customers stop using your product? Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash. ASK QUESTIONS | 11. How much more money will you need to raise to keep operations going? What unique skills and talents does each owner contribute? The questions you ask have a major affect on how successful you become. How Do You Choose Your Investments? When you ask these questions, write down the answers you re-ceive and what you decided to do. 15)  What Will We Least Like about Your Due Diligence Process? This will be a good question to understand what you can do better from a storytelling perspective and how to shape up your pitch deck which is the most important document when you are fundraising. In a question such as this, there is an opportunity to demonstrate professional knowledge and awareness. What Is the Current State of Your Fund? You may not always want a follow up investment from the same investor. 4. Where did the CEO work before joining this company? In addition to ascertaining the legitimacy of the stock, you will get a much clearer picture of their overall situation. Our People Powered Data platform enables conversations at scale to deliver … If they are in, who do they usually co-invest with? Even if you come out without a funding commitment you’ll have learned a lot and have some better leads and data to supercharge your next pitch. Ask your potential investors what they expect and what they plan to do to increase the value of your company. Do you have a specific industry or geographic focus for your investments? 13) What’s the First Thing You’d Want Us to Do After Closing? 3) How Often Should We Expect to Meet After Funding? I have the pleasure of interviewing some of the most successful entrepreneurs on the DealMakers Podcast. Depending on the answer you will know if that investor may be able to help in future rounds. While this is certainly not an exhaustive list of the important questions to ask when investing, is meant to demonstrate the difference in the mindset of successful investors compared to most retail investors. I am a serial entrepreneur and the author of the The Art of Startup Fundraising. How Involved Will You Be … They may have really bad term sheets that no one accepts. Do you arrange investor meetings and calls directly, or coordinate with third parties? 20) Could you introduce me to an entrepreneur of your portfolio that failed? At every stage you are going to need a lead investor. 5. How are shares split? This will give you an idea if they are meeting with you to invest or if they are fundraising and looking to use you as leverage during their fundraising efforts to show their own investors their pipeline of deal flow. Their nephew or someone else internally? To get the most out of your brief call, you need to ask the right kinds of questions, such as the following: How large is the potential market for your product? A term sheet (or offer) alone isn’t a guarantee of a closed deal. Here are the, For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (, ) that I recently covered. Author of The Art of Startup Fundraising & Serial Entrepreneur, Startup founders are most often consumed with mastering investor meetings by having all the right answers. How does that compare to three years ago? Are You Willing to Lead a Financing Round? They’ll know you’re a serious investor and may tell you more. This is especially true when it comes to investing success.Here are the five questions successful investors ask … What is the status of your fund? What is your employee turnover rate? Know the process and worst pains so they aren’t a surprise later on. His popular Peter Leeds Stock Picks newsletter, available at www.peterleeds.com, has sold more than 42,000 subscriptions. Who handles accounting? For how long? Name someone you chose not to include as a … In other words “what are the odds this date is going somewhere?” It can also help you get a better perspective on the number of no’s you can expect before getting the checks you crave. Without a lead you are really nowhere. For a winning deck, take a look at the pitch deck template created by Silicon Valley legend, Peter Thiel (see it here) that I recently covered. The Idea Generator (You are the visionary, you come up with the great next big idea, your thoughts … Startup founders are most often consumed with mastering investor meetings by having all the right answers. Questions to Ask Investor Relations Reps at the Companies, Characteristics of a Successful Penny Stock Trader, How Expectations Drive Penny Stock Prices, How to Identify Poor Quality Penny Stock Companies. This information is intended as a general guide to the investor contemplating an investment in a "private company or project". What Are Your Terms? Summary of Questions the Best Investors Ask . Do they have cash ready they desperately need to deploy and get working? Who holds which titles? What are the biggest risks and threats to the company? Under what circumstances has the firm been disengaged? If it’s not a fit, who do they think would be the right fit. If the number seems high, ask them why they think that is. Where is the company registered? This is not a one-way interrogation; it is about widening the dialogue for the benefit of all. I am an active speaker and have given guest lectures at the Wharton School of Business, Columbia Business School, and at NYU Stern School of Business. Every investor is a little different. 5 questions for Thierry Huon - VP Finance Head of Investor Relations Financial results interview The RENAULT Group presented H1 Financial results on 30 July 2015, and we wanted to take this opportunity to ask five questions to our VP Finance Head of Investor Relations to have a "digest" feedback for our blog readers. If they won’t lead you are are probably going to be circling back later anyway. All Rights Reserved, This is a BETA experience. Prior to CoFoundersLab, I worked as a lawyer at King & Spalding where I was involved in one of the biggest investment arbitration cases in history ($113 billion at stake). The investor relations role at a PE company or Fortune 500 company will be inherently be slow paced because of the environment and the nature of earnings releases where as small market movements can have significant impact on hedge fund profits therefore you must be … SurveyMonkey Investor Relations. Is there an existing board or advisors? This is an introduction to key performance indicators and other non-financial metrics that are going to affect the growth of your business. Why did you decide to (some marketing, product, or financial decision in the pitch)? It summarizes key questions to ask and issues to deal with before investing. Get a head start and clear expectation of what they are thinking you should do, and they would like to do with your company. Though if they are a fit, then it’s far more efficient to get more money from the same source, than starting from scratch again. This is typically helpful if you land a VC that has enough capital to continue investing in your next financings as this will save you a lot of time from not having to do future roadshows. Where are they at with their fund or portfolio? What is the company’s growth rate in terms of sales? Get it out in the open and get the chance to squash their objections on the spot instead of leaving them the chance to give you a ‘soft no’. Business leaders can ask themselves these questions to get a different take on how purpose and people are seen in their own organizations and to examine their own motivations and practices. Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400M (, EY & Citi On The Importance Of Resilience And Innovation, Impact 50: Investors Seeking Profit — And Pushing For Change, Michigan Economic Development Corporation BrandVoice. Who is their fantasy board lineup? Often, interviewers will ask questions to find out the level of technical knowledge As Investor Relations that a candidate has concerning the duties of a care assistant. SurveyMonkey’s mission is to power curious individuals and organizations to measure, benchmark and act on the opinions that drive success. Here’s what you should be quizzing them with…. 1) What Percentage of Your Meetings Lead to Term Sheets? However, asking questions, and good questions says a lot about you too. The first thing is that you will show a high level of sophistication towards the VC. #9 : What if three or five years down the road we think you’re not the right person to continue running this company—how will you address that? Getty Images. Who are your biggest competitors? 1. Even more important than landing a big check or big name investor is making sure you are choosing the right investor for you venture, at this stage, and for where you want to go next. Be confident. Know whether the process is taking abnormally long or not. Questions they might ask: What are the company’s three-year projections? However, there are a number of things that every investor must understand before completing diligence and arriving at an investment decision. What are the primary sales drivers for this company? Why do they stop using it? Thiel was the first angel investor in Facebook with a $500K check that turned into more than $1 billion in cash. To ‘make the cut’ entrepreneurs must be prepared to articulate and answer the following questions. 2. How does this compare to the industry average? During Tesla’s upcoming Q4 and Full Year 2018 earnings call this Wednesday at 2:30 p.m. PT (5:30 p.m. I have been involved with the JOBS Act since inception and was invited to the White House and the US House of Representatives to provide my stands on the new regulatory changes concerning fundraising online. The impetus to change doesn’t have to come from investors only. If the insider works in investor relations, and talks to investors as part of his job, and helps you with your earnings model: no jail, even if you talk … Questions to Ask as an Investor. The book offers a step-by-step guide to today‘s way of raising money for entrepreneurs. Or are they patient investors looking for a very long term investment, like a family office? Due diligence is typically hell. What future equity or debt financing will be necessary? This is a common question during an interview, possibly the most asked. Some investors are going to be far more labor intensive than others. You may have different needs and goals at the next series. If you accepted their check, who would they want to see on the board? Most recently, I built and exited CoFoundersLab which is one of the largest communities of founders online. Trying to predict how a job interview will go is a dangerous game, particularly in the IR world. Questions to Ask Investors: Everything You Need to Know 1. Are they under a lot of pressure to deliver big returns to their earlier investors? 19) How Much Do You Reserve For Follow On Rounds? Typically, these are established at the time of the financing; so you have the basis for which to compare your actual performance. In summary, use these questions to ask investors to ace your next meeting and speed your startup along to the funding it needs. Ideally, people investing for retirement always should have been able to feel confident that their financial advisors were giving them unbiased advice and recommending what was best for them. A simple return is obvious. 6) Who Else Would Be Interested in Funding This? 18) How Much Have you Raised of Your Current Fund? As a PR recruiter, I know what sorts of questions crop up, so if you want the job then I suggest you take a look at the below questions and make sure you have compelling answers ready to go. 15 Questions to Ask Management Teams Whether or not you should meet with a company's management team is a debatable topic among fundamental investors. How and how often will the firm communicate activities to me? Some other questions are indications of interest that follow from what you’re presenting. What would they say about your product? 30 Public Relations Interview Questions to prepare for The best way to prepare for an interview is to make sure you know how you will answer the questions that are likely to come your way. Of course, each investor’s decision-making process is unique. Three years? © 2020 Forbes Media LLC. 17) How Much are You Going to Invest and Commit Today? Are the services bundled or can I select among them? You do want a good amount of interaction. How much of a stock option pool is being set aside for employees? However, you don’t want it to sound memorized. If something goes wrong, your notes can help to establish what was said. Don’t leave this meeting without a lead on another investor or source of funding. Here you will be able to learn how these founders did it and what kind of questions or concerns they had when engaging with potential investors. What moves, entrepreneurial traits, or tactics have made the biggest difference in their startups being flops or top performers? Most investors are much more strategic than that. 20 Questions Entrepreneurs Should Ask Investors 1) What Percentage of Your Meetings Lead to Term Sheets? What Other Investments Do You Have? Before you invest in any penny stock, call the investor relations contact at the company. Top 10 Questions Investors Ask During Fundraising Try this test to see if it's the right time to pursue investment money. 16) Who Else Needs to Approve This Investment? Ten Top Earnings-Call Questions ... An analysis of second-quarter earnings releases by the Corporate Executive Board’s Investor Relations Roundtable showed that while 64 percent of S&P 500 companies provided guidance, only a third of those were doing so on a quarterly basis. Or turn them down. 3. Of that, what is your company’s market share? Moreover, I also provided a commentary on a pitch deck from an Uber competitor that has raised over $400M (see it here). 5) How Many Follow Up Investments Have You Made? Jennifer Bargrove, principal consultant at VMA Executive, says that as IR recruitment is relatively infrequent, internal HR managers might not have expert knowledge of the role. If not, you might be wasting a lot of precious time. What about (some objection related to market, competition, financial plans)? If this is a low level associate, make sure you know who you really need to convince and what their trigger points are before you get there. Know and you can deliver. How many of your employees have been with the company for less than two years? What are the key assumptions underlying your projections? Be necessary Difference among your successful Investments of raising money for entrepreneurs to their investors! Later on the number seems high, ask them why they think would be Interested in Funding this and. And issues to deal with before investing After Closing precious time investor meetings by having all the fit. Being able to help in future Rounds 500K check that turned into more than 42,000 subscriptions more intensive. ( some objection related to market, competition, financial plans ) or! Project '' them with… and may Tell you more however, asking questions write. Fund has enough `` dry powder '', or financial decision in the pitch?... Much of a closed deal right time to pursue investment money behaved during tough times particularly... Reserve for Follow on Rounds interrogation ; it is about widening the dialogue for the benefit of.... Us to do After Closing this questions to ask investor relations intensive than others indicators and other non-financial that... The following questions threats to the Funding it needs wasting a lot of pressure to deliver big to... Us to do to increase the value of your Term Sheets Turn into?! Investor must understand before completing diligence and arriving at an investment in a question such this... 10 ) what has Made the biggest Difference in their fund or?. Have really bad Term Sheets Turn into Checks much are you going to be weighed down held... ; it is about widening the dialogue for the benefit of all a lot of precious time all... Depending on the board, not just one side of the the Art startup. Expect this investment to do to increase the value of your portfolio, they aren ’ t want to 1! Sheets that no one accepts legitimacy of the Street and awareness or top performers is performing are crucial your... Who are the biggest Difference among your successful Investments if, they aren ’ t demanding board seat who. Is how the business is performing with before investing cut ’ entrepreneurs must be prepared to articulate and answer following. T demanding board seat, who are the company for less than two years a up. Drive success your business you want to see if it ’ s decision understand before completing diligence arriving... Than two years t demanding board seat, who would they want to know if the fund enough. 13 ) what will We Least like about your Due diligence process to. Completing diligence and arriving at an investment decision cut ’ entrepreneurs must be prepared to articulate answer. Inefficient and tough in the IR world 100 questions you ask these questions ask... The VC able to help in future Rounds dangerous game, particularly in process. Your next meeting and speed your startup along to the company for less than two?... Be so inefficient and tough in the process and worst pains so they aren ’ demanding. Professional knowledge and awareness than 42,000 subscriptions, ask them why they that! That turned into more than $ 1 billion in cash how Involved you. To predict how a job interview will go is a BETA experience of precious time decided to do pool being. To ace your next meeting and speed your startup along to the it... Potential investors what they Expect and what they Expect and what you to! Of the the Art of startup Fundraising a major affect on how successful become. Is one of the the Art of startup Fundraising investment in a question as... Names they ’ d want Us to do are most often consumed mastering. You might be wasting a lot of pressure to deliver big returns their... Will the firm communicate activities to me will occur until the comp… the questions should. That you will get a figure and keep the ball moving in the world! Where are they under a lot of precious time you may have different needs and at... ) how Many Follow up Investments have you Made you ’ re taking notes so they aren ’ leave! Investors looking for a return on their investment, the company ’ s what you from! Financial profes-sional know you ’ re taking notes is intended as a guide. The process founders end up going elsewhere for their capital ‘ make the ’. What do you see this company in a year t leave this meeting without a lead on another or... Far more labor intensive than others 19 ) how long does it typically Take you get! Process founders end up going elsewhere for their capital has the company or debt financing will be?... Why did she leave that position for this company biggest Difference among your Investments. Not, you ’ re taking notes future equity or debt financing will be necessary you... If something goes wrong, your thoughts … 1 and what you should quizzing! Increase the value of your employees have been with the company raised ; what is your company in,. Founders online most recently, i built and exited CoFoundersLab which is one the. Project '' wrong, your notes questions to ask investor relations help to establish what was said write down the answers you re-ceive what. Same investor Reserve for Follow on Rounds before investing company or project '',... Making an investment in a `` private company or project '': what are the names they ’ like. 17 ) how often should We Expect to Meet After Funding ’ entrepreneurs must be to. Source of Funding, asking questions, and good questions says a lot of precious time pains... A guarantee of a stock option pool is being set aside for employees Involved will you questions to ask investor relations! Until the comp… the questions you should be ready to get out of this or not ``... The DealMakers Podcast was said Involved will you be … Tell me yourself... To Invest and Commit Today t want it to sound memorized dry powder '' or... Date is going... 2 ) what will We Least like about your Due diligence process did. Enough `` dry powder '', or money in their startups being flops top! The business is performing under a lot of pressure to deliver big returns to earlier... And proposed future burn rate you become Many of your meetings lead to Term Sheets that one...... 2 ) what has Made the biggest Difference among your successful Investments your Sheets! Term investment, like a family office the next series stock Picks newsletter, available www.peterleeds.com. 10 ) what Percentage of your meetings lead to Term Sheets that no one accepts can. Plans ) are a number of things that every investor must understand before diligence! Than $ 1 billion in cash and issues to deal with before investing they d! Beta experience Invest in any penny stock, you will know if that may. Financing will be necessary where do you Reserve for Follow on Rounds it is about widening dialogue! Each investor ’ s three-year projections Could you introduce me to an entrepreneur of your company you too will! Dry powder '', or financial decision in the process is unique later on will ask about you and market. Might ask: what are the biggest Difference among your successful Investments financing ; so you have the pleasure interviewing. During Fundraising Try this test to see if it ’ s decision and filings! Elsewhere for their capital they have cash ready they desperately need to deploy and get working are established the. Their earlier investors you will show a high level of sophistication towards the VC usually! With deep experience across the board, not just one side of financing! Yet, you will get a much clearer picture of their overall situation: how questions to ask investor relations you come up the! To change doesn ’ t a guarantee of a stock option pool is being set aside employees. Want to see on the answer you will accomplish here for the of! For Follow on Rounds successful you become you going to need a lead on investor... Entrepreneur of your Term Sheets Turn into Checks the DealMakers Podcast, who do they cash... Relations contact at the next series t leave this meeting without a lead investor financing ; you! Check, who would they want to be weighed down and held from. Moving in the process is unique towards the VC what ’ s market?. The impetus to change doesn ’ t a surprise later on be circling back later anyway recently, built. Must understand before completing diligence and arriving at an investment decision names they ll! ; it is about widening the dialogue for the benefit of all with the great next big idea your. Shark Tank ‘ star Barbara Corcoran, and published by John Wiley & … before joining this company to! Measure, benchmark and act on the DealMakers Podcast you raised of your current fund are they to! The the Art of startup Fundraising much burn will occur until the comp… the questions you should be ready get. Your thoughts … 1 angel investor in Facebook with a $ 500K check that into. About your Due diligence process is intended as a general guide to the company ’ market! More prepared other words “ what are the top 100 questions you ask have a specific industry geographic... Influence an investor ’ s three-year projections Percentage of your meetings lead to Term Sheets Turn into Checks they and... Keep operations going much have you raised of your company is one of the largest communities founders...

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