Investing in your team, in more ways than one
Posted on 04/10/2018
Investors invest in people
It is rare that an investor will back just one founder, instead they tend to look at the whole team. So how can you ensure you build a legendary team to drive your business and entice an investor to join you? Our Access to Funding and Finance team share some sound recommendations…
Create a vision
The most important thing is your ability to sell a vision that can entice the best talent to join your team, a vision that will win your first customer and a vision to bring new investors on board. That vision could be to become filthy rich! But even if that is the case, to generate the money will be a result of your business delivering value and this is intrinsically aligned with understanding your customers and the problems you solve for them.
Some more practical ways that you can build your team, especially on a lean budget, is to work with other start-ups with skills that complement yours. Could you exchange services to support one another’s development? Additionally, could you also consider hiring contractors or part-time employees for times when projects are a little lumpy?
We often think of the team as being those on the company payroll, but actually, having the right advisors on your board can really help build credibility with investors. Equally they can be of value to provide mentorship, shed light on their experience and open up a network of connections. To capture the interest of a potential board member, get to understand their motivations as money is not likely to be a strong incentive (although they will likely expect advisory shares).
Build trust and excitement with the advisor, before inviting them to join your board. If you do bring on the advisor, make sure to have an engagement letter for a defined period of time. This enables both parties to outline what is expected and provides you with the opportunity to not renew the letter if it has not been an effective relationship.
As a start-up you will be competing with Corporates to attract top talent. One method to attract talented employees and advisors is with share options. Share options form a cost-effective employee benefit, which can be used to motivate and retain employees (although you may consider other benefits such as bonuses for your sales and marketing team).
Investors also form a part of your team, so when seeking investment think beyond the money. What networks and expertise will the investors be bringing to the table?
- When raising investment be honest about what gaps there are in your team and how you plan to fill them.
- Create a vision around what you are trying to achieve to bring new people on board.
- What other benefits can you offer other than salary in order to entice talent to join you?
- And finally, you don’t have to have a full team now, so who do you have in your network that you can tap for expertise and support when needed?
Best of luck building your legendary team!
Get in touch with KTN to see what support we can offer your start-up.