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Three key things investors look for before deploying capital

With advancements in technology, investing is being democratised like never before. However, with more power comes more responsibility for founders and investors. Founders and investors are still humans who are susceptible to making costly mistakes.

“We see thousands of Enterprise Investment Scheme qualifying investment opportunities each year,” Andrew Aldridge, Partner at Deepbridge Capital. “We screen companies based on stringent criteria, including the protectability of the Company’s intellectual property, the global market they are targeting, their revenues to date, and much more. However, it is the people behind the product or service which are ultimately the reason behind why we invest and for this there is no one-size-fits-all.”

However, the key attributes that commonly set great entrepreneurs apart include resilience, drive, teamwork and an understanding of their own limitations.

Resilience

Those who have experience running their own business will know that things rarely go as planned, even if the owner has a perfect business plan. However, resilience can steer a business through tough times.

“It is also important that founders have the drive to grow a business and aim for an exit opportunity in line with investors’ goals. When raising venture capital, it is important the entrepreneurs realise that their goals need to be aligned and the business cannot drift,” says Aldridge.

Team

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It may seem obvious but it is vital to hire the right people. A founder who shows the ability to work in and lead a team, is therefore critically important or you’ll find your capital being used up on hiring and firing and not progressing with long-term committed professionals.

Play to Your Strengths

The final key point is that founders need to have the humility and self-awareness to understand their own weaknesses and where help is required. “For example, academics may know the science and purpose of their life-changing discovery, but they may not have the commercial experience to build a business or the sales aptitude to take the product to market,” Aldridge says. Only by understanding their gaps can the founders then bring in the required team-members to expedite the growth of the Company. Understanding one’s own weaknesses is very much a strength.

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