Chapter 4 - Investor Relationships
IN THIS LESSON
Start with a Relationship: Invest in Your Investors First
It may be easy to think of investors has simply people who do something for you – give you money to grow your business, nothing more than a transaction. But in addition to giving them a return on their investment (ROI) years later, it is in your best interest to initiate and cultivate a relationship with your investors – from the start.
Here are two pieces of advice to help you invest in your investors first:
Take a genuine interest in your prospective investors as people.
See what you can do for them – not just what they can do for you.
A relationship is two-way. It succeeds when there is mutual respect, trust, open communication, and each person is watching out for the best interests of the other. Both are contributing value to the relationship. Being selfish, arrogant, and uncommunicative can drive investors away from you. Having poor listening skills, being too aggressive and thinking too short term can undermine your efforts to obtain money from prospective investors for possibly a singular reason: they don’t like you.
But if you approach them with a generous attitude to want to help them as much as they, could you, you open a door to a relationship. If you listen to them and thank them for feedback, including critical feedback, you start to build trust. If you take their first and second “no” in stride and not get offended, but stay in touch with them, share useful information and encourage them, you leave open the possibility of a future “yes.”
The following are more ideas of what you could do to invest in your investors:
Find out what they are really interested in and then share relevant information with them.
Stay engaged with them on social media and in person (i.e., at events)
Refer them to resources that may help them.
Ask them for advice.
Act more like a friend; sometimes just asking them how they are doing.
Lend a listening ear from time to time.
Ask them how their family is doing.
Tell them about upcoming events that they may find interesting.
Share your passion and purpose with them.
Be always honest in your communication.
Be respectful.
Send them “thank you” cards (yes, written thank you cards, which would make you stand out)
Not every investor will want to be your friend, but if you treat everyone with respect and treat them as important, then you will give them a good feeling. Most people tend to remember more vividly how you make them feel more than everything you say. Investors who are in a relationship with you will value you for who you are and what you bring to the table. They will respect you back and listen to you. It takes time and consistent effort to build this kind of trust.