Investor Faq

---
name: investor-faq
description: Use when a founder needs their objections answered in writing — "investor FAQ", "objection handling for the raise", "the hard questions", "what will investors push back on", "we keep getting the same three questions", or after a memo exists and needs pressure-testing. Also use to pressure-test a plan before writing anything: an objection with no good answer is a business problem, not a writing problem. Investor-side; for sales objections use objection-handling.
---

# Investor FAQ

## Why this document wins deals

Every objection to your deal will be raised. The only question is whether it is raised in a room you are in, or in a partner meeting you are not, by someone reconstructing your answer from memory.

The FAQ puts your answer in writing, in your framing, in the reading room. It also does something no other document does: writing it honestly tells you which parts of your business do not yet have an answer.

Investors read a real FAQ as confidence. A soft one — "Why is your team the best? Because we are passionate" — is worse than none, because it proves you either cannot see the objections or won't engage them.

## How to build it

**1. Harvest, don't invent.** Pull questions from what has actually been asked: every investor call, every "quick question" email, the questions your own team asks when you present internally, and the ones a competitor's investor would ask. 25–35 questions for a seed round, 15–20 for pre-seed.

**2. Group into five or six themes.** The standard set:

- *The market* — is this real, is it big, why now
- *The thing itself* — does it work, is it defensible, why you
- *The numbers* — are the figures real, is the margin credible, is it capital-hungry
- *The competition* — what stops a better-funded player
- *Execution* — the biggest risk, the team, the dependencies
- *The deal* — price, structure, dilution, return, exit

**3. Sort hardest-first inside each theme.** The instinct is to open with the easy one. Do the opposite: a reader who sees the hardest question answered first in a section reads the rest with trust. A reader who has to hunt for it assumes it is missing on purpose.

**4. Write the questions in the investor's words, including the sharp edge.** "Colocation is a low-margin commodity business. Why is this venture-scale?" — not "Tell us about your margins." A softened question announces that the answer is softened too.

**5. Answer in 80–150 words.** One-line answers look evasive; 400-word answers look defensive. If an answer needs more, it belongs in the memorandum and the FAQ should point to it.

## The answer pattern

Four moves, in order, in every answer:

1. **Concede the true part.** One clause. "It is, for the base layer."
2. **Reframe to the thing that is actually true.** "The base layer is the entry point, not the business."
3. **Evidence.** A number, a contract, a third-party report. Non-negotiable — an answer with no evidence is an opinion.
4. **What would change your mind, or what is still open.** One sentence, where it applies.

The concession is the move founders skip and the one that does the work. An answer that disputes the premise reads as a fight; an answer that grants the premise and then dismantles the conclusion reads as command of the facts.

## Judgment

**Keep the question you cannot answer well.** If the honest answer is "this is a real risk, here is the bound on it, here is what we watch" — that is a good FAQ entry. Investors are not looking for a business with no risks; they are checking whether you can see yours. The only thing to cut is a question that is genuinely not about your deal.

**Two or three answers should be uncomfortable to publish.** If nothing in the document costs you anything to admit, you have written marketing and a professional reader will notice within two entries.

**End with an open invitation.** A final entry — "anything we have not covered: email X" — and mean it. It converts the FAQ from a defensive wall into an opening.

**Never contradict the memorandum.** The FAQ is where numbers drift most, because answers get written fast under pressure. Every figure goes through the fact ledger.

## What good looks like

- The three objections you dread most are all in there, near the top of their section.
- Every answer contains at least one verifiable fact, not just reasoning.
- No answer uses "we believe" as its only support.
- Someone who has never met you could answer a live investor question from this document, in your voice.
- Questions read as a sceptic wrote them.
- An honest "we don't know yet, here is the bound" appears at least once.

## Gotchas

- **Marketing voice creeps in around question 12.** Energy drops and the answers get vaguer. Write the hardest ten first, when you are fresh, and re-read the back half specifically for softening.
- **The FAQ becomes the dumping ground.** When a question needs 500 words and a table, it is a memorandum section. Move it and cross-reference.
- **Stale answers after a pivot or a re-price.** The FAQ is the last document anyone updates and it contains the most specific claims. Check it first after any change.
- **Anticipating questions nobody asks.** If it has never been asked in ten calls, it is padding — and it signals what you are anxious about.
- **Legal exposure in forward-looking answers.** Return and exit answers need the same care as the memo's: state assumptions, avoid anything that reads as a promise of a return.
- **Answering a question that isn't the real one.** "Isn't this capital-intensive?" is usually "will I be diluted to nothing?". Answer the question behind it, with the dilution maths.

## Worked example

Weak:

> **Q: Isn't this market very competitive?**
> A: While there are other players, we believe our technology and team give us a strong advantage, and we are moving fast.

Strong:

> **Q: What stops a better-funded operator from copying this in eighteen months?**
>
> Nothing stops them starting — and two probably will. What is hard to copy is the sequence. The site permit took 14 months and there are four comparable sites in the region; we hold one of them on a 20-year lease. The grid connection agreement is capacity-allocated and the next allocation window is 2029. Both signed customers have 5-year terms with switching costs we can quantify at roughly 7 months of their own engineering time.
>
> So a competitor with more money arrives in 2029 into a market where the cheap power and the anchor demand are already contracted. That is a real business for them, and a worse one than ours.
>
> *Where this gets harder:* if the regulator opens a second allocation window early, the timing advantage compresses to about two years. We would still hold the lease and the contracts, but we would be competing on price sooner than the plan assumes.