Investor targeting (or shareholder targeting) is the process used by companies to identify and approach appropriate (potential) institutional investors.
It is an essential part of shareholder identification (or shareholder ID): knowing who your shareholders are and therefore also identifying who are not. Investor targeting could be a means of ‘filling in the gaps’.
Matching investors to the company
Typical in the process of investor targeting is understanding the investor’s specialisation (or ‘sweet spot’) in order to match those investors that fit best with the companies’ characteristics. Criteria that should at least be screened in targeting the right investor are industry sector specialisation, preferred stage of company development, preferred investment amount, investor risk profile and geography.