When meeting an investor for the first time, entrepreneurs face a lot of pressure to make a favorable impression quickly. Whether you are seeking $1 million in investment or $50,000, it is important to cover some basic homework before trying to make your case. Here are five things that entrepreneurs should keep in mind before approaching any investor for money:

What is their investment philosophy?

This is the first and the most basic homework that an entrepreneur has to do—Find out what is the thought process or investment philosophy that an investor has along with their domain expertise and focus. This will be crucial as different investors have different approaches to investments. They could be VC investors, or prefer to invest during the seed stage or they may even prefer to invest during the growth phase. These approaches could be based on their beliefs, values, relationship with money, experience etc. and could shift their strategies according to the latest market trends and their past experience

What do investors like in the startup?

Entrepreneurs may meet several investors while raising money. It is important to find out what the investors liked about your start-up—domain, the approach to the solution, the product/service, future potential etc. While it is up to the entrepreneur to figure out what they will do with the feedback from the investors, it would be a good idea to keep a tab as it helps to understand what investors look for. Investors seek concrete proof that the product/service has a huge market potential and hence look for either proprietary features, competitive advantage such as intellectual property protection or exclusive licenses etc.

Be clear on any other inputs they require

Most investors know what exactly they are looking for. The entrepreneurs should make sure that they give the right kind of information such as more background on the kind of technology used or the competition the start-up faces in the market. The entrepreneur should put forward positive points to the investors and ensure that they get a complete view of the company’s history and financial details, including debt, how money was initially raised, what they are comfortable with etc.

What is the decision-making process and timeline?

Investors have different methods to evaluate an investment proposal. Hence, the entrepreneur should ask each investor what their timelines are like. Sometimes, if investors are part of a firm, they will need the consent of the Board or their Partners before they can go ahead and sign on the dotted line. Hence, it is essential that the entrepreneur ask how much time the investor will take to get back on the final decision. An investor may sound enthusiastic about supporting your project, but it will take a long time to obtain an agreement in writing. Don’t expect a quick yes or no. Prepare yourself for maybes for at least a few months.

What are the future milestones they like to see in the start-up?

For most investors, the proof is in the pudding. Hence, most of them will insist that the entrepreneurs cross a specific agreed upon milestone like breaking even, or expanding into newer categories or markets, or crossing the milestones in terms of employee and customer head count etc. This will give the investor the confidence that the start-up is indeed worth investing in. Investors too prefer start-ups that have a clear and completed business plan and have a view of what the next two-three look like.

If you go into an investor meeting with this checklist in mind, you will have a better chance of being an efficient fund-raiser and maximize your chances.