Let’s Talk Business with Doug Wilson part 2

In this edition of our Let’s Talk Business guest blog we hear from Doug Wilson about the next stage in getting investment ready.

Doug Wilson is a Partner at Deloitte Private in Hamilton.


Having developed a strategy of who the optimal investor(s) would be for your business, based on the investment need and lifecycle stage, the second critical step is to then prepare your business for the scrutiny that will come during engagement with potential investors.

There is a checklist of what an investor will expect to see when undertaking due diligence as part of a decision to invest or not. 


The checklist consists of a central core that is common to all businesses in terms of information that will be asked for, but there will be other aspects that are more specific to the age and stage of your business. 


For example, all investors will want to know what amount of capital is being requested. What its intended use is for? And the basic terms of the deal being offered for the equity (e.g., ‘the how much, for how much?’ question). 


However, investors looking at an early stage investment will place as much, if not more, value in financial projections and the assumptions being applied, rather than, say historical and the reverse will be true for a mature stage investment decision.

Investors will want to see clean, coherent financial information, that doesn’t include personal transactions, and will have a real interest in your balance sheet and cash flows (often overlooked). They will want to see that you prepare budgets, and how well you track to budget (this speaks to your ability to develop and execute on plan).


Allowing time prior to going out for investment to ensure you have the requisite financial information, like budgets, monthly reporting, annual reporting etc. is critical.  You must understand and answer the questions they will ask within your numbers, before they ask it.

There will be non-financial information sought as well, for example, contractual relationships with clients, IP related documentation, customer profiling, HR documentation, business plans, board minutes, amongst a number of other things.

Having a clear understanding of what an investor will want to see, and having it at your fingertips, will ensure you don’t leave value on the table through negotiation. 


In addition, understanding where those informational gaps are, and allowing the requisite time to prepare them is the critical preparatory work required prior to going to market for investment.

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