OPINION9 November 2023

Lorna Tilbian: How to turn acorns into oak trees

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Lorna Tilbian, Impact columnist and chair at Dowgate Capital, shares her seven tips for how to invest in businesses.

oak tree with sun shining through leaves

Want to advise on building a business? Want to turn acorns into oak trees? Want to stack the odds in your favour? Take these seven guiding principles – or pillars of wisdom – and adhere to them with zeal.

1. Back proven entrepreneurs

Back those who have done it before, who have built a business from scratch and who know the trials and the tribulations, the agony and the ecstasy. They know what the stock market expects of them – the rules of engagement – and have an existing fan base of investors who made good returns from them in the past and will back them again.

2. Real skin in the game

The chosen entrepreneurs must have real skin in the game; they must risk their own capital and not just play with other people’s money, otherwise known as ‘opium’. Ideally, they should hold up to 20% of the equity, but no more, so they don’t develop imperialistic tendencies.

Too much control is almost ...