Questions from a potential investor, mentor or partner

This post first appeared here as an article on Proseed Magazine in 2013. I have updated many times since then.

Introduction

I often receive inquiries from individuals seeking feedback, advice, mentorship, or investment for their business ideas. To help me better assess these opportunities, I've compiled a list of questions that I typically ask potential partners, mentors, or investors. If you want to know how not to approach me, read “What do you think of my business idea?” which I wrote after a particularly annoying message. Please take the time to review and answer these questions thoughtfully before we meet.

Target Audience

This article is intended for individuals who have approached me seeking feedback, advice, mentorship, or investment for their business ideas. I typically send this article to individuals who have expressed interest in connecting with me through an intermediary.

Why I Request Pre-Information

I believe that requesting pre-information from potential partners, mentors, or investors is a fair and efficient way to filter through inquiries and ensure that we both make the best use of our time. It also demonstrates that the individual is serious about their venture and has taken the time to prepare.

Pre-Meeting Preparation

I am typically willing to dedicate up to one hour of mentorship or feedback to individuals with business ideas. However, I reserve the right to decline or reschedule meetings if I deem it necessary. I encourage individuals to attend events where I will be present to maximize our interaction time.

Questions for Potential Partners, Mentors, or Investors

  1. Clients and Potential Clients:

    • What have you done to gather feedback from potential clients about your idea?

    • What are the key pain points or problems that your solution addresses?

    • How do you plan to attract and retain customers?

  2. Vision and Value Proposition:

    • Why are you passionate about this idea?

    • What unique value do you offer to your target audience?

    • How do you differentiate yourself from your competitors?

  3. Long-Term Value and Repeat Revenue:

    • What is your long-term vision for the company?

    • How do you plan to generate sustainable revenue?

    • What opportunities exist for repeat business and customer loyalty?

  4. Current Situation and Business Model:

    • What stage is your business currently at?

    • How are you currently making money or plan to generate revenue?

    • What are your key business processes and operations?

    • Please provide a brief overview of your financial performance, including costs, revenues, profits, and employee count.

  5. Costs and Founder Salaries:

    • How have you structured your costs and expenses?

    • What is your approach to founder salaries and compensation?

    • How do you plan to balance profitability with founder compensation?

  6. Competition:

    • Who are your direct and indirect competitors?

    • What are your competitive advantages and weaknesses?

    • How do you plan to stay ahead of the competition?

  7. Strategic Plan:

    • What are your growth plans for the future?

    • How do you plan to expand your geographic reach and product offerings?

    • What are your strategies for market penetration and customer acquisition?

  8. Benefits for Investors:

    • How do you plan to provide returns to investors?

    • What is your exit strategy and potential valuation?

    • What are the risks and potential rewards for investors?

  9. Ownership, Shareholders, and Team:

    • Who are the key members of your team?

    • What is the ownership structure of your company?

    • What are the strengths and expertise of your team members?

  10. Gaps and Challenges:

  • What are the key areas where you need additional support or expertise?

  • What challenges do you anticipate in the future?

  • What steps are you taking to address these gaps and challenges?

  1. Barriers to Entry:

  • What factors might prevent other companies from entering your market?

  • What sustainable competitive advantages do you possess?

  • How do you plan to protect your intellectual property and market share?

  1. Dangers and Threats:

  • What are the potential risks that could jeopardize your business?

  • What contingency plans have you in place to mitigate these risks?

  • How do you plan to adapt to changing market conditions and industry trends?

  1. My Role:

  • How can I specifically help you achieve your business goals?

  • What are your expectations from me as a potential partner, mentor, or investor?

  • How can we collaborate effectively to achieve mutual success?

Conclusion

I hope that this list of questions provides a helpful framework for preparing for a meeting with me or other potential partners, mentors, or investors. By carefully considering and answering these questions, you can demonstrate your preparedness, showcase your business