Ten questions an investor will ask your board

3 October 20267 min readD6 Sigma

Why start with questions

A listing is won or lost long before the prospectus. By the time licensed financial advisers, legal counsel and auditors are appointed, the clock — and the fees — are running. The owners who move fastest are the ones who already know where their gaps are.

Below are ten questions that, in one form or another, come up in due diligence and in investor meetings. For each, we describe why it is asked and what a good answer looks like. Score yourself honestly: 0 for no answer, 1 for a partial or verbal answer, 2 for an answer that is documented and that someone other than the owner can give.

The ten questions

1. Who really controls the company, and how are decisions made? Investors want a clear ownership map, shareholder arrangements in writing, and decision rights that do not all end at one person.
2. What happens if the owner-manager or a key executive is unavailable? Key-person dependence is a valuation issue. A succession plan, deputies with real authority and, for family firms, a family charter answer it.
3. Do your numbers tie? Audited statements, consistent accounting policies, a monthly close measured in days, and management accounts that reconcile to the audited figures.
4. How good is your forecast? Show the last few forecasts against what happened, and a model driven by operating assumptions rather than a spreadsheet of hopeful totals.
5. Which customers, suppliers or contracts could change the story? Concentration, contract terms, the quality of the backlog, receivables ageing and retentions — especially for contractors.
6. What are the related-party dealings, and how are they approved and priced? Disclose them, document the pricing basis and show who approved them.
7. Does the board govern, or only approve? A charter, the committees the rules and good practice call for, independent judgement, regular meetings and minutes that record the debate.
8. How do you know the controls work? A risk register that is used, delegation of authority, an internal-audit plan, and IT and financial controls that someone tests.
9. How do you meet your regulatory and compliance obligations? Licences, labour and localisation requirements, e-invoicing and tax filings, safety and environmental duties — as relevant to your sector, with an owner for each.
10. Why list, why now, and what will the money do? A growth plan, a use of proceeds, a dividend approach and a management team ready to report to the market regularly.

How to read your score

• 16–20: you are close. Use advisers to polish and to manage the process.
• 10–15: a realistic programme of governance and reporting work comes first; the timetable is set by the gaps, not by the market.
• Below 10: start with the foundations — ownership, succession, finance and reporting. They help with bank financing, partners and growth whatever you decide about listing.

Many owners find the honest answer to the last question is “not yet”. That is a useful answer, and cheaper to reach early.

What to do next

1. List every question you scored 0 or 1 and name an owner and a date for each.
2. Close the cheap gaps first: ownership map, board charter, delegation of authority, a monthly management pack.
3. Build the forecast model and test it against history.
4. Only then appoint advisers, with a clean base to work from.

D6 Sigma prepares the company — governance, reporting, forecasting and controls — and works alongside your CMA-licensed financial adviser, legal counsel and auditors. We are not a financial adviser or an underwriter, and nothing here is investment advice. Listing requirements change: confirm them with your licensed advisers.