Have you ever heard of the term ‘smart money’? The premise is that the investment capital you take on, as a business owner, is often times more than just money. Sometimes it comes with the added benefit of actual help from your investors.

The famous American entrepreneur and investor Marc Andreessen said it well: “The best assumption to make is that your VC’s primary value add is the cash they are investing. Then you’ll always be surprised on the upside.”

When businesses have an objective of raising capital, thinking about maximizing the capital beyond receiving it can be overlooked. We love helping entrepreneurs make the most of their investors, and we truly believe the blended model of VCs and retail investors is the best way to access smart money. Ultimately, having strategic investors is a measure of being proactive. As the company’s CEO, it’s up to you to convert your investors’ capital into smart money. Here are a few things you can do to make the most of your investors.

Brand Champions and Seasoned Investors

At FrontFundr, we believe the best deals include a combination of both regular and accredited investors. The value provided by both loyal advocates and seasoned professionals as investors can provide unprecedented synergy.

People who already know and love your product and believe in its value are more likely to advocate on your company’s behalf than those who have never tried it firsthand. Your customers are often your most loyal brand champions, and so more and more companies are tapping this group for early-stage investment through equity crowdfunding exemptions. Not only does this provide startups with much needed access to capital, but it gives your early adopters a chance to get in at the ground level. It allows them to share in your success in a meaningful way that hopefully leads to their future reward, as well as their proactive contribution in promoting your business.

At the same time, bringing on professional investors who have worked with similar companies before can add tremendous value. Not only do these investors typically invest larger sums, but their experience and connections can be invaluable in growing your company. Ultimately, businesses should aim for a balance of both regular and seasoned investors.

Communicate Regularly

Taking a proactive approach with your investors is what’s ultimately going to turn investment dollars into more than just money. Empowering investors to become brand champions rests on the company’s leadership, and without it, you’re unlikely to maximize your access to ‘smart money’. By establishing regular touch points with your investors, educating them, and communicating with them frequently, you are far more likely to convert them into active brand champions. With transparent communication and regular empowerment, you have the ability to transform your investors into your best sales people. Don’t take a passive approach—let your investors know how they can help the business and what their value add is. And keep them informed via regular communication.

FrontFundr is passionate about helping founders achieve their entrepreneurial goals and grow their business to the next stage. If you’re looking to raise funds for your early stage private business, check out our How it Works page, check the Eligibility Criteria to learn what it takes to participate in equity crowdfunding, or reach out to our team.