undercover.co.id – Maximising Growth with Investors , Accelerating growth can be done by entrepreneurs through collaboration with investors and advisors.
In a competitive business environment, collaboration between founders, advisors, and investors is a key factor in achieving sustainable growth. A comprehensive approach to understanding how entrepreneurs can work together with investors and business advisors can accelerate business growth.
In a nutshell, founders are the driving force behind the business, seeking capital, mentorship and support to realise their vision. Business advisors provide guidance and expertise to help founders make informed and experienced decisions. Investors provide the financial resources necessary for growth and expect a return on their investment. Effective communication, clear roles, and alignment of interests are key to success in collaboration among these stakeholders.
“Maximising Growth with Investors and Advisors” encompasses a comprehensive strategy at once to foster a sustainable and ethical business ecosystem. At its core, it also involves creating effective proposals for investors that not only outline the potential and advantages of your business but also align with their goals and values. These proposals should emphasise transparency, accountability and a clear roadmap to achieve mutual growth.
In addition, regular discussions, conducted effectively for a minimum of one hour with business advisors, will be a key cornerstone in strategic decision-making. These dialogues should ensure that your business benefits from diverse viewpoints and insights, can create a comprehensive environment where innovation will be fostered and potential problems can be proactively addressed and avoided.
The sincerity of investors and founders is key in building trust and maintaining a sustainable and ethical business. Investors must believe in the founder’s vision and dedication. While the founder must honour the financial commitments and expectations of the investors.
By upholding these ethical principles and working in harmony with advisors, businesses can pave the way to sustainable growth that not only optimises profits but also prioritises social and environmental responsibility. Ultimately, the synergy between investors, business advisors, founders and a commitment to ethical practices paves the way for businesses to thrive in a profitable way. Both for its stakeholders and society at large.
Maximising Growth with Investors
The position and needs of business advisors, investors and founders within a business may vary, but each has a distinct role to play in the success of the business.
Founders are entrepreneurs who create and launch businesses. They are the driving force behind a business, responsible for the vision, strategy, and day-to-day operations of the business.
Here, they often require financial resources to start and grow the business. They may also need to possess and acquire specialised skills or knowledge related to their industry or market. In addition, guidance and mentorship from experienced individuals can help founders make informed decisions. Founders need support from business advisors and investors to deal with challenges and uncertainties. And, founders value autonomy in decision-making to realise their vision.
- Business Advisors
Business advisors are individuals with industry expertise, experience, or specialised knowledge who provide guidance and advice to founders. They often have a non-operational role but provide valuable insights that optimise the business.
Here, business advisors need a clear understanding of their role and purpose in advising the business. They need effective communication with founders to provide relevant guidance. In addition, access to the latest information on business progress and challenges on both a local and global scale is important. So is having a very strong network.
Business advisors will need collaboration and support from founders in implementing their recommendations. Recognition of their contribution and respect for their expertise is important to advisors.
Investors provide capital in exchange for equity or return on investment. Typically they will be concerned with the financial success of the business and often have a financial interest in it.
Investors expect a return on their investment (ROI), and their primary need is to see the business grow and make a profit. Some investors may want involvement in strategic decision-making or representation on the board of directors.
Investors need to understand exit strategies, such as acquisitions or IPOs (initial public offerings) of shares to realise their investment. Assurance that the business is taking steps to reduce risk and achieve financial sustainability is important to investors.
In some cases, there are also investors who also double as Business Advisors. Whether it is more effective for the business advisor to be a different party or the same party as the investor depends on various factors. These include the specific needs of the business and the dynamics of the team. Both approaches have their advantages and disadvantages.
If the business advisor is a different party to the investor, the advantages are diverse. An advisor who has no financial investment in the company will provide a more objective perspective and advise solely for the good of the business. There is also no conflict of interest between the business advisor’s role and their financial holdings, resulting in more impartial guidance.
But on the downside, an external business advisor may not have the same level of alignment with the success of the business as an investor with a financial stake in the company. In addition, external advisors may not be as deeply involved in the day-to-day operations of the business as internal advisors (investors).
What if the business advisor is the same party as the investor? An investor who also acts as an advisor is highly motivated to see the business succeed because his financial returns depend on it.
But there are also drawbacks in terms of conflict of interest. The dual role of investor and advisor can sometimes create a conflict of interest, especially if the investor has a different vision or priorities from the founder. There can also be a loss of objectivity, as an investor-advisor may prioritise financial returns over other aspects of the business. This can result in decisions that are solely driven by profit.
In many cases, a combination of these two approaches can be effective. For example, you can have an external business advisor with specialised expertise to provide objective guidance, while having an investor who is actively involved and invested in the success of the business. This allows you to benefit from diverse perspectives and interests.
So having a capable business advisor who understands the roadmap of both the entrepreneur and the investors will be indispensable. Having regular discussions with a business advisor has a number of significant and important benefits in managing and growing a business.
Business advisors usually have extensive experience and knowledge in a particular industry or field. Regular discussions provide an opportunity to receive valuable guidance and advice from someone who has faced a variety of business situations. This can help founders and management teams make better and more informed decisions. In addition, being less involved in day-to-day operations, they can view issues and opportunities with a broader perspective and free from bias. Business advisors bring an external perspective that can provide a more objective view of your business.
Regular hour-long effective discussions between a business advisor and an entrepreneur are a valuable opportunity. It is utilised to discuss important topics, evaluate progress, and plan strategies for the future.
Here is a suggested agenda for conducting such discussions:
- Review recent developments, including achievements, challenges, and changes in the business landscape.
- Discuss key performance indicators (KPIs) and metrics to measure progress.
- Evaluation of progress made against pre-set goals and milestones.
- Determine whether adjustments or refinements to the objectives are necessary based on current circumstances.
- Discuss the long-term vision and strategic direction of the business.
- Brainstorm and plan for upcoming projects, product launches, or market expansion.
- Identify potential obstacles and develop a plan to overcome them.
- Review the financial health of the business, including income, expenses, and cash flow.
- Address any financial issues or challenges and explore solutions.
- Evaluate the use of funds, especially if investor capital is involved.
- Discuss market trends, customer feedback, and competitive analysis.
- Explore growth opportunities, potential market shifts, or emerging trends.
- Review marketing and customer acquisition strategies.
Operations and Team
- Evaluate the efficiency of business operations and processes.
- Discuss any staff or team-related issues, such as recruitment, training, or performance.
- Ensure the team is aligned with the company’s goals and values.
- Identify potential risks, both internal and external, that could affect the business.
- Develop or update risk mitigation strategies and contingency plans.
- Address compliance and legal issues. Action Items and Follow-Up
- Summarise the key points of the discussion.
- Assign responsibility for specific actions and set time limits.
- Establish a plan for follow-up, either through regular meetings or communication channels. Q&A and Open Discussion
- Allow time for founders to ask questions and seek advice on specific issues or concerns.
- Encourage open dialogue and exchange of ideas.
Conclusion and Recap
- Summarise the main points discussed during the meeting.
- Confirm the date and time of the next meeting.
- Express gratitude for the advisor’s time and insights.
This structural agenda will help ensure that discussions cover important aspects of the business, encourage effective communication between advisors and founders, and enable joint problem-solving and strategic planning. Adjust the timing for each section according to the specific priorities and circumstances of the business.
Now how to work with investors? One of the keys is to develop a good business proposal that is aligned with their vision and mission.
Congratulations on maximising your business growth together with advisors and investors!
“The sincerity of investors and founders is key to building trust and maintaining a sustainable and ethical business.”