- Milly Barker
- Sep 24
- 11 min read
Huge news - we're on the final article in the Investment Readiness series.
In this series of articles, we've been learning about all the critical areas of your business that investors will inspect when you're going out and asking them for sweet, sweet piles of cash to build your dreams.
We've covered everything you need to know:
Strategy: how to define, refine, and document your path forward
Operations: assessing and optimising for genuine scalability
Finance: building robust models and projections that stand up to scrutiny
Data Room/Collateral: preparing comprehensive due diligence materials and data rooms
Coaching: getting ready for the tough questions with investment meeting and Q&A coaching
Investment Strategy: mastering cap table planning and investor identification (this article)
I wrote this series (in part, I also wrote it because it's really useful) because we recently launched an Investment Readiness service to help startup and scaleup Founders and Operators get the best raises on the best terms by honing their operational effectiveness - we call that service 'Op Eff It' because there are few things I love more than a cute play on words.
If this is the first article you're reading in the series, I recommend checking out the others first in the links above, as they set the context for this one.
Or, if you've read them all and you're ready to roll, why not take Op Eff It's free Investment Readiness Healthcheck to find out your next best steps across all 6 of the categories?
For this final article, I’ve, once again, got my favourite co-author with me, Will Herrmann.
Will has partnered with me on Op Eff It and brought a huge amount of his expertise to the table. Will has over 20 years of experience in strategy, operations and finance having spent ten years in management consultancy with Accenture before moving into COO/CFO roles in startup, VC and charity, so he brings broad and really rare perspective as well as extensive practical experience to the topic of Investment Readiness and I’m excited for you to hear his thoughts.
Ok, let’s dig in. So far, you've crafted your Strategy (the map of where you’re taking the business), you’ve fine-tuned your operations (what’s powering you forwards). You’ve also built your finances (how you showcase how well it’s all working) and you've got everything ready to be inspected in your data room. You've rehearsed and readied yourself to hold your own in investor meetings and now the final piece of the puzzle - figuring out who you actually want to be meeting to get the best results for you and your business.
Despite what you may read on LinkedIn, this part of raising capital is not a numbers game where you just spam every investor you can find with a snazzy DM (so please stop commenting 'LIST' on posts promising to send you hot investor links - this is more of an engagement-driver for the content creator than anything else). This part of the process needs to be a targeted, relationship-based, thorough exercise. Your job now is to ruthlessly zero in on the people who not only hold the purse strings, but also genuinely understand and believe enough in what you're building to want to open them wide.
And to know who they are, you need to be really clear who you are - from an external perspective. We call this the 'Investment Profile'. Let's look at how to pull one together.
How do you build the foundation of your investment strategy - an Investment Profile?
To build a solid Investment Profile to showcase what your business is to an outsider, you need to know, and document clearly, three key things - 1. what you're selling, 2. what you need, and 3. who is already in the mix.
The art of knowing what you're selling
First, you're going to want to write an 'Investment Profile' for your company. This is a clear, concise statement of what you’re offering to an investor.
It’s based on your company’s current stage (are you Pre-seed? Seed? Series A? That mythical stage in between that sometimes gets called 'Seed Plus'?), your sector (bonus points if you can use a snappy portmanteau for it. Are you FinTech? BioTech? Ecommerce?), and your key metrics (are you showing rapid user growth? Do you have solid revenue? How sexy are your unit economics?).
And for the love of all that is holy, don't forget to include your Problem Statement - this is absolutely crucial for communicating your likelihood of finding Product-Market Fit. Where is your customer today? Where do they want to get to? What are the (financial) consequences of them not getting there? And how is your solution the bridge that gets them from A (today) to B (tomorrow) and helps them avoid the consequences (C)?
Be super specific with yourself across all of these points because your Investment Profile is what dictates the type of investor you should be speaking to. Trying to sell yourself as something for everyone will just waste a lot of everyone's time.
The science of your capital needs
You'll need a very clear answer to a simple question: "How much are you raising, and what are you spending it on?"
This isn’t a number you just pull out of thin air. The amount of capital you seek should be directly linked to the strategic and operational milestones you plan to hit over the next 18 to 24 months and the answer should be clear, objective, and easy to digest.
For instance, "We're raising £500,000 to hire two engineers and a Head of Marketing to grow our monthly active users by 3x and launch our xyz product feature."
This is the kind of answer that shows you're disciplined, you have a plan, and you know what success looks like. Investors like success.
The story of your cap table
Your cap table (or capitalisation table when it's in trouble with its mother) is a document that shows the ownership of your company. It covers who owns shares, how many, and what class of shares they have. It’s also where you track things like convertible notes, options, and other forms of equity.
Investors will scrutinise this document. They want to see a clean cap table that's free of unnecessary complexity or a confusing ownership structure that's going to cause a headache at any liquidity opportunity. Having a well-organised, up-to-date cap table demonstrates your transparency and the readiness of your data for review and, because it tells a clear story about who's involved and why, it can save you a lot of time that might otherwise get lost in wasted meetings with unsuitable investors.
Once your summary of who you are and what you offer is ready, it's time to look at who you want to send it to.
Where can I find the right investors for my investment strategy?
Trust me when I tell you this: choosing the wrong investors is something you want to avoid at whatever costs possible. Some quick cash now is not worth the headaches in the future so choose wisely.
First, let's understand the different types of investors you might end up speaking with.
Angel Investors
These are high-net-worth individuals (NHWI) who invest their own money directly into a company. They’re often ex-entrepreneurs or industry veterans who have both the capital and (ideally) the operational experience to be valuable mentors. They typically invest smaller amounts than a fund, but they can be faster to act and are often more flexible because they're not answering to anyone else.
Angel Syndicates
Angel Syndicates are groups of individual Angel Investors who come together to invest in a single deal. This allows them to pool their money for larger investments and to share the due diligence workload. It gives you access to a larger cheque and a wider network of experienced individuals, but it can also mean dealing with a group of people rather than a single investor - bigger cash pools, yes, but bigger potential for closing the deal to feel like organising a Hen party in a group chat when you're more of a friend of a friend of the bride...
Venture Capital (VC) Funds
VCs are institutional funds that invest other people’s money. They raise capital from Limited Partners (LPs), which can include pension funds, university endowments, and other institutions. They are managed by General Partners (GPs) who make the investment decisions. The key difference from Angels is that VCs are managing a fund with a fixed lifespan and specific return expectations, which drives their decision-making process. They invest larger amounts but are often more rigid in their approach because they are answering to other people.
Venture Debt Funds
Venture Debt is a form of loan for startups. It's often used as a supplement to equity funding to extend a company’s runway without further diluting the founders' ownership. While not an equity investment, it’s an important capital source for many founders to be aware of, especially as they scale.
It's really important when you're looking for your next investor that you don’t just chase the biggest name or the largest cheque. The right investor can be a really valuable partner, while the wrong one can be worse than no investor at all.
You ideally want value-add investors who bring more than just money to the table. These are people with relevant sector expertise, a strong network you can tap into, and a track record of helping similar companies grow.
A good fit investors should be able to offer strategic advice, make key introductions, and support you through both the good times and the bad; it's about a shared vision and mutual trust, so make sure you’re vetting them just as much as they're vetting you.
If it feels overwhelming, why not book a free, no-strings call with us to get an idea of what sort of investor might be right for you?
We've spent years getting to know what investors want and do and one of the things we offer in our Investment Readiness service is having someone alongside you for the duration of the raise so you can get the funds you need without losing your mind - and so you can stay as focused as possible on what you do best: building a great company.
If that sounds like something you’d enjoy, why not book a free, no-strings call with us to learn more.
How do you start building an investor list?
Once you understand what you're offering and the type of investor you're looking for, it's time to get very precise with your approach. The best way to get in front of the right investors isn't by casting a wide net. It's about being strategic and personal - we're all tired of generic cold outreach and investors will be getting more of that than most. Don't add to the noise!
So forget mass-emailing a thousand investors (that's a surefire way to get ignored); the best results, by far, come from a highly targeted list and a warm introduction if you can get one. An investor is far more likely to take a meeting with a founder who has been vouched for by a mutual connection they trust.
Your key goal here is to build a high-quality list of people who are the right fit for your business and then find a way to get a personalised introduction.
Your target list should be a living document/section of your CRM/project management tool of around 50 to 100 investors who are a potential fit. Here are some practical steps to build it:
Look at your network
Start with your existing connections. Who do you know who has raised money before? Who are your mentors or advisors? They likely have a deep network of investors and can make key introductions. Can you buy them a coffee?
Study your competitors
See who has invested in companies similar to yours. Check their websites, LinkedIn profiles, and platforms like Crunchbase or PitchBook (n.b.; a lot of these platforms will be behind a paywall but a lot of them also offer a free trial). This is a great way to find investors who already understand your market, but who you've never heard of - it's also a nice dose of market research whilst you're at it.
Search by sector and stage
Use databases like Dealroom to filter investors by their investment thesis, sector, and stage (e.g., "Seed stage investors in UK fintech").
Go to networking events
While definitely less efficient (and you gotta put on outdoor clothes), attending industry events or pitch competitions can absolutely give you opportunities to meet investors in person which is a great boost for building relationships when you've exhausted your warm intros and can help you add names to your list that you might not otherwise have found.
How do I craft the perfect investor outreach?
Ok. We know what you're selling, we know who you're selling it to, and we know how and where you're going to find them. All that's left is to figure out what you're going to say.
I hate to say it (that's a lie, no-one writes this much if they don't love giving advice), but a great pitch deck and a comprehensive financial model are useless if you can't get an investor to look at them.
When you're trying to slide into an investor's DMs, your initial outreach needs to be concise, compelling, and get straight to the point. Whether it's a warm intro, an in-person elevator pitch, or a cold email (as a last resort), every message should include five simple things:
The Hook
Make this a single, really punchy sentence about what you do and what you've achieved.
Something like: "I'm the founder of [your company], the [solution, x, for problem, y] that has grown [z]% month-over-month."
The Ask
Be clear about what you want.
e.g., "We're raising a [£x] seed round and are looking for investors who specialise in [your sector]."
The Proof
Briefly mention your key traction metrics (e.g., revenue, user growth) and your team's background.
The Deck
Attach a concise pitch deck (or better, a link to a password-protected one) that tells the full story.
The Call to Action
A simple, clear ask for a 15-minute call.
Hopefully this goes without saying, but all this information needs to be conveyed, but it's really important that you make sure it's delivered in a human way and woven into a genuine conversation at the appropriate moments.
No one wants to feel like they're being pitch-slapped. Your job is to make your pitch feel like a natural part of a dialogue, not a monologue, building a relationship as much as you're presenting a business case.
Is your Investment Strategy investible?
It's been ten weeks of work to bring these 5 articles together so TRUST ME when I say that I know this is a lot of work to go through; you're asking for a lot (a pile of money with no certainty of any return) so it's going to take some work to pull off.
Once you're worked through everything above, use these ten questions as your final gut check. If you can't confidently answer 'yes' to all of them, it’s not time to pull your Investment Strategy into action yet. Go back, do the work, and get to a place where you're not just ready for a conversation, but ready for a deal - or, give us a shout and we'll help you.
Do you have a highly targeted list of 50-100 potential investors who are genuinely a good fit for your business? A general list is a waste of time and will likely get you ignored.
Can you clearly articulate why each investor on your list is the right fit for you, based on their portfolio and investment thesis? This shows you’ve done your research and you’re not just spamming them.
Do you have a concise and compelling pitch that clearly explains your problem, solution, and traction in the first few minutes? You need to grab their attention immediately.
Are you armed with compelling, quantifiable data that backs up every claim in your pitch? Your story is great, but your numbers are proof.
Have you thought through and prepared answers for the tough questions you’ll inevitably face about your competition, risks, and scalability? Anticipation is the best defence.
Can you explain exactly how you'll use the capital to hit specific, measurable milestones over the next 18 months? A vague answer suggests a vague plan.
Do you have a clean and well-structured cap table that you can confidently present and explain to investors? This is a key part of your business's DNA.
Are you prepared to handle potential rejections and stay focused and resilient throughout the fundraising process? It's a long, tough road.
Do you have a clear understanding of the terms and valuations you are seeking, and what a 'good' deal looks like for you and your business? You need to know what you want to walk away with.
Is your team fully aligned and prepared to support you, from providing operational data to attending key meetings? A solo mission is a tough one to win.
Take the time to answer these questions honestly. Your answers will give you a pretty good indication of whether you're actually ready to even try to book these meetings, let alone to perform well in them.
If you’re struggling to answer any of them, or want any additional help, just give us a shout via the link below or why not get ahead of the game and take a free Investment Readiness Healthcheck to assess how you're doing across all 6 of the categories?
Otherwise, that concludes our series on Investment Readiness and I need to go and find something else to write about next week. Wish me luck...
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