Growing a small business with investment is a proven strategy for success.  Getting to that point however is difficult for many companies.  Good finances are, of course, a positive for investors but there are other aspects of a company that investors will look at when determining whether to part with their cash or not.

Investors want to know as much as possible about the company they are potentially investing in.  Thus, the importance of up to date and real time functional intelligence cannot be discounted.

The use of this data then allows for the investors to make decisions based on facts as opposed to basing opinions on assumptions.  This, therefore, is a clear marker for growth and gives the investor greater scope of where the business is and where it potentially could be.

For many start ups, the need for accounting software may seem far away from what they require, as they bustle with improving cash flow and ensuring that their business stays afloat in the crucial early years.  Conversely, being ahead of the game and gaining access to this data at an early stage will put you in good stead for any potential investors.

 

What Data Do I Need?

It’s OK to say “get data for investors”, but there is so much potential data out there, so what data do investors actually look for?

Essential data that investors may look for is profit & loss (P&L) data.  This is not only important in terms of law and compliance but it can be very useful for anyone looking to invest in a company.  P&L data can show the level of risk that companies possess and can inform decisions on whether the business is likely to grow and by how much.

Payroll is another piece of data which can be used by investors to determine their investment decisions.  This information can be compared to similar roles in the same or similar industries which will give investors a better idea of how a business is run.  Investors can even use this information to check wages, reward schemes, pensions and sick pay to understand the workings of the business and the views of the staff by the owners.

Following on from payroll, salesforce is another aspect of the company which investors will spend time analysing.  Similarly, this will give them a good idea as to how the business functions.  The data can easily be cross checked against other similar businesses to discover things like the over or under payment of staff.

 

How Can Software Help?

Most importantly, technology is something which will – more times than not – make an investors eyes light up.  Market analysis, product demos and marketing campaigns are sure to be sufficient to gain initial interest from investors but as time goes on and technology moves forward, investors will want to see the use of technology becoming a standard practice for investable businesses.

Technology can be used to drive and measure business growth.  Due to its ability to create faster more evidence based decisions, the use of technology increases efficiency.  In order to improve efficiency, inefficiency must first be identified.  Technology will provide companies with a single and consistent view of their activities and will enable a smoother path to investment.  This will provide investors with transparency throughout the process.

 

Do You Use Data To Its Full Potential?

Many businesses have a lot of data that they do not use to its full potential.  The use of technology enables businesses to gain full access to this data and provides multiple dashboards with multiple data points.  This provides them with the tools they require to make business decisions and create or manage KPIs based on fact rather than hypotheticals.

An owner or founder of a business that uses technology also shows investors that the person behind the business knows exactly what is required when it comes to asking for investment.  Investors are more likely to have their mind put at ease if the owner shows a level of business maturity and makes crucial data easily accessible.

 

Cofficient are official NetSuite partners and with NetSuite, we can integrate all of your business data into one easily manageable and accessible business platform.  NetSuite is all cloud based meaning that real time financial data is available at the click of a button.  This information can then be shared to potential investors in a simple dashboard which provides all of the necessary data.

Get in touch with us today to start your next stage of growth.