Checklist For When You Want To Invest In A Startup

Investing in a startup is just like executing a heist plan. It takes a lot of thought and planning, and when executed well the reward at the end is sweet as honey. How many main characters in action movies just do a heist without planning it out, none! 


So, just like any heist mastermind, you will need a checklist to prepare yourself for the big event. Using a due diligence checklist is favourable to any investor looking for the perfect startup. Once you have checked all of these boxes, you will be ready to invest in the startup.


Know the market


Just like any heist mastermind you will have to know your target. You cannot just run into a bank and ask for a million dollars if the bank is mostly electronic and doesn’t have cash on premises. So, what would the heist mastermind do? They will scout out the target first. 


The same goes for you as an investor. Scout out the market to see if it is worth your time and investment. Once you have done your market research and decided which market you are interested in, then you can start looking for a startup that suits your needs.

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Collect information on the startup


A heist mastermind will keep their eye on their target for a few days, even weeks, before they start executing the plan. They will search for routines, soft points and anything of interest to make the heist easier, smoother and more rewarding.


So should you! Once you have decided which startup you would like to invest in, research them. See where in the market they fall, when they started up, how much revenue they make, what the quality of their brand is, how they treat their customers, and most importantly, how much funding they would need. 


Get to know the team


It is easy to have a perfect heist plan, but it can quickly fall apart because the team isn’t aware of the other’s weaknesses or strengths. Even worse, they cannot work together as they purely don’t know each other. It is also harder for team members to trust each other, so the heist might not go as planned.


Same can be said for the team of the startup that you plan on investing in. As an investment, you plan to receive something in return. This means that you have to make sure that the team can be trusted with the funds that you sink into the startup. You should be able to know where their strengths and weaknesses lie and if the team is able to work together.

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Review the business plan


Any heist planner will have a well-structured plan that indicates the who’s, the where’s, the when’s, the why’s, the what’s and the how’s. The plan is detailed with every single little detail written down. The plan will even contain contingency plans and backup plans.


For your investment to bring you that sweet reward at the end, you should make sure that your desired startup has a well revised business plan, that contains all of its goals, predictions and any backup plans for if something goes wrong. A startup that has all of their ducks in a row, is more likely to succeed than one that runs in “controlled chaos”.  Controlled chaos is not a state that any business should be in.


Execute the plan


Before a heist mastermind executes the plan, they always do a run through to make sure that the team can work well together and that the plan is well-structured. After everything has been fine-tuned the montage of training and planning stops and action music starts playing. The plan is in motion and the team has finally started their mission. 


This could also be said for your investment plan with the startup. Make sure that you are able to work well with the startup and that you are happy with the way that they handle things. Only after you are happy with everything, do you then start the investment. This will give you peace of mind. 


At Velvet Platform we can help with your master plan, as we have a community of startups who are ready to receive funding. With us, you have two options. You can either donate to a startup or invest in a startup. When donating to a startup you ensure that the future of the startup is bright, without any risk to you. 


However, if you are in it for the long run, prepared to stand by the side of your startup and help them grow, then investing is perfect for you. We can help you choose the right investment for you to execute your master plan. Contact us today to see how we can help you.

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