Who is an investor?
An investor is an individual that designates capital with the expectation of a prospective financial return or to gain an edge. Types of investments include equity, debt securities, real estate, currency, commodity, token, derivatives such as put and call options, futures, forwards, etc. This description makes no difference between the investors in the primary and secondary markets. An investor who owns a stock is a shareholder ot a stockholder.
“Investors are investing in you, the team”
That’s what businesses who seek investment funding are advised, as they were once again, many times, at a boot camp for startups where I was a mentor recently. “We’re investing in the team” is simple to say.
It’s not always clear to read. That’s particularly the case if you haven’t had a lot of team practices, and more particularly, if you haven’t had a lot of business team skills and roles. To really understand “We’re investing in the team,” you have to learn teamwork in an emotional sense.
And sometimes, honestly, it helps to have been on and to have led very successful and less successful teams, as well.
“We’re investing in the team” is far more natural to grasp if you understand the risks, opportunities, and tools of teamwork and leadership. Often, some of the best learning transpires when you’ve had great but also less praiseworthy experiences on, and at the helm of a team. You learn a lot, like it or not, from having to struggle to create success from looming failure.
Essentially, what “We’re investing in the team” means is that investors – whoever they are – are studying if you and your management team can:
- Turn a fabulous idea into a company and then a thriving flow of profits.
- Work well collectively.
- Turn your might as a team into something far greater than your strengths, as a group of separate people.
- Connect well with your possibilities and convert them into clients.
- Organize people and supplies to meet the opportunities and challenges you face, some of which you know, and many of which you don’t…yet.
- Attract a prominent team.
- Employ the team in your imagination and keep them occupied through the ups and downs of startup life.
- Lead without crushing the powers and interests of individual members of the organization.
- Adapt well, as a team, as circumstances change – because they will.
- Admit when you, as a leader or leadership team, need help.
There are additional things that investors are looking for, too, when they say they’re “investing in the team.”
You can rest assured, however, that if you do the 10 things on this list well, and if you do them better than your rivals, you’re well on your way to success, however, your company is funded, whoever is at the wheel.
Think about what would give you confidence that a startup firm and leadership team were likely to succeed, if you were an investor, trying to guess which firm was most likely to benefit from among the many on which you could place your bets, and your capital.