I am amazed how many entrepreneurs take the background of their investors at face value.
There is no way any professional investor will leave any of this to chance or face value. So why should the entrepreneur….
You need to do research – and lots of it.
Here are some of my favourite sources of independent research on a potential investor:-
Obvious I know but look at least 10 pages of Google results – it will give you some background on the investor apart from the propaganda you read on page one!
Again highly obvious but check out their profile and people they know – the connections they have are highly valuable to you as an entrepreneur – so probe them a little
I love Duedil.com is is one of the simplest ways to find company information. If they said they were a cofounder of x – research it here. It will also link you seamlessly to other directorships. Most investors have “service companies” that they use to invest from or charge fees – you can check them out easily.
But more than anything reference them – ask for 4-5 references that you can take up – or use your Linkedin network to find mutual connections.
As I always say “An investor is for life, not just for Xmas” so make sure you do as much research on them as they will do on you!Tweet