What do business investors look for when they decide to fund a company?

A detailed business plan. It should include and specify the type of business, its location, structure, and target customers. Some specialists say a good business plan is a key factor to getting the necessary capital, others contradict this theory, saying that referrals are actually the most important. However, a poor business plan with no executive summary will surely end up in the dust bin.

Business background. Besides checking your business experience, investors will also want to see your background in the industry you’re going to deal in and your management team. Make sure you are surrounded by specialists who have at least a lot of knowledge in their field, although experience is preferred as well.

Research on competition. Entrepreneurs should know who the competitors are, what their marketing strategy is, and this will be an important analytical section of their business plan. Questions about your strategy and ability to distinguish from other similar companies will arise. Be prepared to answer them realistically.

Financial projections. As investors seek a return on their investment, they will expect you to present realistic financial projections as well as an exit strategy. They need to see how much money you need, what for and when (following rounds of investment).

Transparency. It has an important role in establishing a balanced relationship with investors. They will be able to provide you more that the capital you need to develop your company. They have the necessary business experience, as most of them started as entrepreneurs before deciding to become investors, therefore they will also bring expertise and advice.

The most important ingredient for a successful business is the belief in your ideas and in the benefits they bring to your future customers.