As a Lawyer I have been able to represent client on the table of negotiation at some point or the other and as such there are certain things I have noticed that cab immediately turnoff an investor. I'll highlight a few;
1. Don't pitch to an investor with a Business Name: It gives them a perception that you're a one man business regardless of how you brand yourself. A one man business is prone to mixing funds, little or nor accountability, no corporate governance and lacks guarantee. Rather pitch with a Company Limited by shares owned or co-owned by you.
PS; Ensure that you don't end up diluting your shares in the name of bringing an investor and lose out yours in the end. The Story of Healthplus is one to bring to mind.
2. Don't pitch without a Company Profile: As a Serious minded business, you ought to have a company profile showing your work, portfolio, team, track record and many other substantial details. Note that this is different from a Business Plan or Business Summary as it were. It's mostly prepared by your Lawyer.
3. Don't pitch without Legally Protecting your Intellectual Property:
It is a risk for an investor to invest in an unprotected brand, because it is prone to massive infringement, lawsuits, your market share can even be diluted and so many others issues that may rise. To avoid drama, Investors would not even consider you. So ensure you do proper Legal protection for your brand, Patent, Trademark, Trade secrets and Confidentiality Agreements, Intellectual Property Agreements, Copyrights, Industrial Designs. etc. Talk with a Lawyer to advise you properly on this.
4. Don't pitch with an Inactive business:
Now this may seem little but just a few weeks back, a Client almost lost out on a major deal because his business wasn't even found on the cac portal, the investors found it hard to believe that he owned the business or that there was an actual business even though he had the CAC documents. We came to the rescue, I and my team had to make several applications for it to even show on the portal so we could file for annual return. After it showed on the portal, we filed, we still went ahead ensure that it reflected as "ACTIVE". Active means your records with CAC are updated and you are ready for business and business opportunities. So ensure you file your annual returns and let your business indicate "ACTIVE" on the cac portal.
5. Keep your books in order:
An investor wants to know how much you've made so far so that they can know your ability to handle their money and do likewise with it. The truth is "he who is faithful with little, will be faithful with more". So ensure that your records are up to date, the money is in a corporate account, the account of your business not your personal account. Ensure that all transactions are properly documented and you don't have details like "shawarma, Cold Stone creamery, Dolce and Gabbana.etc" as narration for expenditures. They know what you will do to theirs too. It will graduate to "Maldives, Marrabeach".etc 😂😂😂. If you can't account for 500k, you can't account for 5Milion.
There are more but I will stop here, so that you will pay me for consultation, I can't spill all the beans😂😂😂. I'll reserve the rest for my paying client.
You would notice that I didn't mention Register your business, if you don't have a registered Company, Otilo!
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Business