Some companies need both management skills and money and that’s where the concept of an investing director comes in.
An investing director can be a valuable asset to an SME because they provide the management skills and small business advice you need by performing a non-executive or part-time non-exec role.
In addition to this, they can also offer much-needed funding, usually in exchange for equity in the business.
Many people confuse an investing director with a business angel but what exactly is the difference?
Typically, a business angel puts money into a business they like the look of. There is often little consideration of the value they can provide in terms of management, the small business advice they can offer or the relevance of the angel’s background and experience to the needs of the company. The whole process tends to be self-matching with a fair bit of emotion involved. The end result? The money goes in and the angel ends up meddling in the business rather than providing management skills or help with the business strategy and as a result, many such SMEs end up failing.
NXD’s model of an investing director is different in a number of ways. Firstly, we try to work out the management skills that are needed in your business and we match you to people who possess these very qualities.
Secondly, we look at which of these people are prepared to put money into the business as well as their time and effort and finally, if necessary, we look at whether we can help to find further funding if the investing director concerned can’t put in all the money required.
We always put finding the right management skills first because we believe this is what’s going to add the most value to your business. It’s not necessarily an easy process and can take longer than finding a business angel, but we can assure you that the end result is far better.
If you would like more information about our services, please feel free to contact us and we will be more than happy to help.