This is the golden rule of seeking investment. Never take money for money’s sake! Investment only adds value if done for one or more of the following reasons:
- Accelerating the Vision. Access to capital allows you to get to market and profitable scale sooner. Only take what you need. This is usually less than you think.
- Access to Expertise. Getting investors and their networks bought into the business expands your resource and knowledge base without full-time salaries. This is the most cost-effective way to access valuable expertise. It only works if your investor is willing to be actively involved.
- Accountability Partners. No-one will hold you more accountable to the deliverables and timelines of your high-risk projects that your investors. This accountability keeps you on track and supports you when you lag behind. When you have a healthy dynamic, this can do wonders for your business. It could also be devastating when you have a cop looking over your shoulder. Choose wisely.
These criteria should form the basis of your investment evaluations. Money is merely the vehicle you use to grow the business. The engine that drives that vehicle determines the performance you will receive.
Check under the hood.