3 Crucial Questions Nigerian Startups Should Be Asking Investors Outside Financial Backing
Emmanuel Nnaemeka
Informacion Capital Consulting
We are in the midst of an investment boom, globally and locally. Every day, there is breaking news after another about Nigerian startups receiving investors backing – that is capital. According to Crunchbase, a whopping $288 billion has been invested in startups globally in the first half of 2021 alone. The deals have been over the roof. Between 2020 and 2021, over 50 startups received investors’ funding in Nigeria.
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The number is on the increase. However, funding is not the end; it is a means to an end. While it is important to get funded, to get things started properly, it is also important to note that investors can give you assets beyond the dollars. Founders must also acknowledge that while they are keen on getting the big venture capitalists, those without the deep pockets can be considered promising too.
Founders must look beyond paycheck to be in business for a longer period. It doesn’t stop at receiving funding, it goes beyond that. You must ask questions and look for other benefits of investments beyond the dollars. In this article, we are going to highlight what startups should be asking from investors other than capital.
How Investors Can Help In Scaling Into New Markets Overseas
In this digital age when there are billions of people online than ever, Nigerian startups need their operations to be 100% digitalized. But beyond this, having an international presence or a presence in markets beyond Nigeria should be one of their most pressing concerns. Therefore, Nigerian startups should be asking more than a paycheck from investors; they should be more interested in how investors can help them upscale beyond the borders of Nigeria.
Founders can seek how investors support them when they want to upscale; it could be through their global network; learned wisdom from other startups in their portfolio that have scaled successfully; or the appropriate business models that lead to easy upscale, and so on. The investors should be able to avail you of the needed resources that can help you scale into new markets overseas.
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How Investors Can Grant You Access To Knowledge And R&D Resources
Another demand founders should be placing on investors is the investors’ ability to avail them to knowledge and research and development (R&D). Don’t rely on investors’ resumes, ensure that they are well-versed with market insights, and they have a pool of connections that help with strategic planning and execution in future projects. Founders should be keen on how investors can link them up with market experts, projectors, advisory, and consultants that can grant direction to them.
Founders should endeavour to explore investors’ resources as they are versed in having labs and technology resources that can be instrumental to startups. Startups shouldn’t be afraid to request these kinds of tools from investors, even if they have traditionally been reserved for the likes of Fortune 500 companies.
How Investors’ Backing Can Skyrocket Your Brand Beyond Borders?
As a company that is starting, it is necessary to get your brand beyond borders. It might be difficult to do this alone, therefore, it is very expedient to demand how investors’ backing can improve your brand. It is important to leverage an investor’s reputation to upscale your brand. It is far more impactful and cheaper to do so. Founders should be more interested in how investors, through their networks and connections with the local and global markets, boost their brands.
A Final Word
In the age of investors’ boom, the concept of capital is gradually losing its might. Startups need to ask investors for expertise and tools to scale their businesses. If an investor can’t provide these things in 2021, they shouldn’t be on your radar.
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