Keeping Your Investors Invested (In You)

admin October 22, 2020

Ali Husain, CFO at Analog Devices, spoke at 021Disrupt 2019 where he shared his valuable tips for winning investors over and how to cultivate long-term relationships.

Ali used these simple techniques during his lengthy career at Analog Devices which helped him create relationships with his investors, but more importantly, to retain them for a long time.

So let’s get right into it. Try and see if you’re guilty of doing taking any of these steps, and what you can do to fix them.

  • Don’t badmouth your competition to potential investors.

It’s not that difficult, and it comes off as highly unprofessional. If an investor is talking to you, that means they’re interested in your field, so if you give off the impression that you’re disrespectful of your industry peers, it shouldn’t come as a surprise if your investors chose to move away from you, and towards your competition.

Instead, make it a point to explain to your investors why you’re a better investment, and what differentiates you from the rest of the competition.

  • Trust is very hard to earn, and just as easy to lose.

Be honest with your investors about how your business is doing, especially if you’re not doing too well. That way, you can show them exactly how you plan to fix it. Honesty also builds trust and will lead to a stronger relationship with your investor. Humanize yourself instead of trying to come off as someone know already knows everything and is only looking for money, and you will find that people will be more willing to pay attention to you.

  • Solve for your customer problem.

Having spent many years at Analog Devices, Ali has found that oftentimes, when they create a product that’s amazing and exciting, it can still fail pretty badly. There’s a fundamental reason for this failure that is repeated throughout many different talks, and by people from various industries, and Ali puts it succinctly:

‘We’ve solved for a great technology problem, but not particularly a market problem’

Ali Husain

So do the research before you pitch your ideas. Are you solving for something that needs solving, or are you creating a product that will need to curate an audience before it can sell?

  • If you shut down tomorrow, would it matter?

Ask yourself if your customers will notice if you suddenly fell out of the market tomorrow. What would their initial reaction be? Would they go to a competitor, or would they choose to abandon the product entirely? If you feel like you’re leaning towards the latter, then perhaps you need to work on making your product a bit more memorable and useful in your customer’s daily life.

  • Investors want to see you grow.

Whenever you can, try to make it a point to show tractions of progress in the marketplace. Whether it’s revenue growth, metric growth or you’ve managed to get new restaurants or pharmacies on board for your project, investors love to see it.

  • Target the right investors.

Investment is a big step, and one that lasts (hopefully) for a long time, so know that they need to be the right fit for you just as much as you need to be the right fit for them. Your vision, values and even time frames need to be aligned. If you’re looking for a 5-year investment, but your investors looking for the next year or so, then consider whether it’s worth pursuing.

  • Ideas vs. Execution

“Being a thinker is fantastic, being a doer is even better”

Ali Husain

Everyone loves a hustler, and investors especially love working with people who show that they’re passionate about their business through their hard work and dedication to their ideas.

They want to work with people who are working to achieve their dreams. Cause disruptions, make waves, and you’ll get noticed without having to run after anyone.

  • It’s okay to get investors excited about your business.

If they’re excited, that means other investors are also probably excited and keeping an eye on you. And there’s nothing wrong with using this to pressure your investors or to use the attention as leverage.

Keep in mind that you should do it respectfully, rather than becoming so arrogant that you lose the interest of investors you already had.

  • Communication is key, so make sure it’s something you’re good at.

If you feel that you’re lacking when it comes to communication skills, whether it’s spoken or written, speeches or emails, presentations or proposals, then make it something you’re actively working on. Take a workshop, take a class, but become so good that no one can afford to ignore you.

  • Always ask for help and feedback, and do the same for others.

Feedback is the foundation of growth, so ask your team, employees, investors, whomever you’re interacting with whether there are things you can do better. Not only will it help you grow, it will also make you much more approachable and easy to work with.

Don’t forget that, at the end of the day, every investment is essentially a transaction. Investors want to see returns, and if you keep your employees and customers happy, generally this can be easy.

Ali ended his talk with a reminder that, with the kind of talent, passion and dedication that is bubbling in Pakistani startups, there’s no reason that with a great idea, and an even better hold on ethics, you can’t get a shot at the 20 trillion dollar industry that’s out there.

A Designer Lens on Product Market Fit