No one should consider launching a product or service without getting into the heads of their consumer, digging into when, where and how often your offer might be purchased and what you are competing against for a share of their purse.

The same principle stands for understanding the motivations of a potential investor. After all you are selling something to them. Here are a few pen portraits of 7 investor personas that you might come across. Whilst you’re unlikely to meet exactly the investors below, you can expect to come across some combination of these characteristics.

1. Passionate Polly: she is intimately involved in your market, maybe professionally experienced or they have some empathy as a potential user of your product or service, for example a mother is more likely to understand baby products.

Tip: be careful in assuming that because someone knows your market that they will understand or appreciate your idea — they may be so entrenched in the standard thinking around the industry they find it hard to see a valuable innovation that could take a category in a different way.

2. Taxed Trevor: there are some highly attractive tax reliefs available for investors in start-ups — the Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS). Unfortunately, this can become all-consuming for some investors. It’s more about working out about how much they will save, rather than the attractions of the business and the growth story.

Tip: make sure you are all over EIS & SEIS and understand and can talk about the reliefs your investor can enjoy.

3. Friendly Freddy: he has time on his hands, looking for a hobby and some stories to tell on the golf course or at dinner parties. These investors can be a hugely helpful resource, might have helpful contacts and can be a place to seek emotional solace and support.

Tip: avoid investors wasting your time, either during their ‘due diligence’ or after they have made an investment. Sit with them to define how they can be helpful and set expectations about when, where and how to involve them.

4. Helpful Helen: she has stacks of experience and a relevant black book for you to use. Possibly from the direct industry you are setting up in, but potentially also with broader but still relevant experience — e.g. in marketing or finance. They are likely to have battle scars that will help you avoid the same mistakes.

Tip: don’t assume or take the help for granted. Put in place a clear agreement up front for what this help looks like (more so from a value than time perspective). Make sure you say thank you frequently. If they can contribute significantly then create a transaction to lock-in the commitment. This could be anything from free product through to some share options that vest upon the growth of the business.

5. Sweating Simon: an investor that likes to make their money work. They will have a portfolio of investments and as soon as they make this investment they will be on to the next one. They are unlikely to want to get involved and you might never hear from them.

Tip: just because you never have a reply to investor updates, or never get a word of congratulations, don’t think they don’t care. Still make sure you regularly update them and don’t be shy to ask for help – just don’t be disappointed when you don’t get a response.

6. Professional Penny: investors that run funds and spend all day every day looking for businesses to back. They are likely to be highly structured and clear about what they are looking for – and appreciate that in an entrepreneur.

Tip: these investors have an infrastructure to support you and will charge fees for their help, so make sure there is a conversation about fees up front to avoid surprises.

7. Connected Charlie: the value of this person may not be in them making an investment, but they might know someone who would. Either they are just super well connected and you can tap into their network informally or their job is to connect investors with opportunities

Tip: even if you are disappointed that someone turns down an investment, make sure you leave them with a good impression. And don’t be shy to ask the question “do you know anyone else who might love our idea and be interested in backing our business?”

Written by Matthew Cushen, co-founder at Worth Capital

Further reading

7 funding choices when it comes to financing your start-up

How entrepreneurs can qualify and take advantage of EIS and SEIS

3 ways start-ups can create irresistible investment proposals