Over the past decade, I have invested tens of millions of dollars in private businesses, not only from my own funds but also on behalf of my clients at LaGrande Global. Each year, I review hundreds, sometimes thousands, of business opportunities from around the world. Of those, I invest in only three to five annually.
So, what does the process entail, and how can your business become one of the select few?
To begin, you should know that I built my business from scratch. Starting with nothing—no investors, no initial funding—I grew it to generate millions. I understand the challenges and relentless dedication required to run a business.
On the flip side, taking investor capital, especially private funds, is not a casual transaction. A thorough due diligence process is essential. Many proposals don’t align with my criteria, sometimes due to factors such as business readiness, industry fit, funding utilization strategy, or projected returns. This process isn’t meant to be discouraging; there are other investors, and many businesses thrive without external funding.
The Process
Our engagement will begin with questions—many questions. I need to understand three key aspects:
- How your business operates
- Who you are as a person and leader
- Verification of all the information provided
For point three, I will require detailed financial documentation. If you are unable to produce this, our conversation will conclude promptly.
If I am uncomfortable with any of these three elements, I will end the discussion. My time is highly allocated, and I prioritize opportunities that align well with my own businesses and other investments. If I say “no,” please respect that decision. However, if your business evolves and aligns better in the future, I am open to reassessing.
Preferred Businesses and Industries
I generally prefer to invest in [mention any specific industries or business types]. While I keep an open mind, I am less inclined to invest in certain industries due to personal preference or experience.
Key Questions
Here are some of the primary questions I will ask during our discussions:
- How will I recoup my investment, and what is the expected timeline?
- Do you have other investors involved in your business?
- What frequency of business updates will you provide?
- Why do you require additional funding?
- Why is bank financing not a viable option for you?
- What are your long-term goals for the business?
- Who are the current owners and partners?
- How do you acquire and retain clients?
- What sets your product or service apart from competitors?
- What are the primary risks in your business model, and how do you plan to mitigate them?
- What is your current revenue, and what is the projected growth rate over the next 1-3 years?
- What percentage of ownership or equity are you offering in exchange for the investment?
- How do you intend to use the funds specifically, and what is the expected impact on the business?
- What are the key performance indicators (KPIs) you track, and what are the recent trends?
- What is your customer retention rate, and what strategies do you have for increasing it?
- Who are the key members of your management team, and what experience do they bring?
- How scalable is your business model, and what are your plans for expansion?
- Do you have an exit strategy in place, and if so, what does it look like?
- How transparent and open are you in discussing challenges the business faces? I value transparency and prefer honest communication about issues as well as successes.
Typically, the process takes a few months, though occasionally, it may extend longer depending on the specifics we uncover. I am never in a rush to issue funding; I am committed to understanding precisely where my investment is going and who I’ll be working alongside for years. If I can’t envision a long-term partnership, I will not invest.
Advice, Consulting, and Partnership Expectations
In general, I do not aim to be a hands-on partner. I have my own enterprises to manage. While I am open to occasional questions and providing advice when relevant, I do not intend to take an active role in consulting, managing, or generating sales for your business. Simply put, unless compensated significantly, my time is better utilized elsewhere.
Consider my investment a catalyst for your growth. I may offer targeted support when necessary, but this should be limited to specific areas where it would significantly benefit the business. Additionally, while I’m not involved in day-to-day management, I may expect high-level updates on major strategic decisions or changes.
Working Style and Communication
I prefer communication via email and WhatsApp. Please note that I do not respond to messages immediately. This is not a reflection on you personally; I sometimes take days to respond to my own family. My response time is about managing my commitments, not a lack of interest.
Thank you for considering an investment relationship with me. This process is structured to ensure a successful and beneficial partnership for both sides.