Every founder talks about vision, TAM, disruption.
But when an investor looks under the hood, the first thing they check is whether your numbers make sense.
If the books are sloppy, confidence vanishes.
Why do you think most Shark Tank deals fall apart or get re-negotiated outside of Television?
I’ve seen this play out for years in boardrooms, due diligence calls and even casual investor chats over tea.
The entrepreneurs who get funded are the ones who treat bookkeeping like oxygen.
Let me break it down.
Tally is powerful, but only if you use it right
Most Indian businesses still run on Tally.
Nothing wrong with that. It’s reliable, cheap and auditors know how to handle it.
The mistake lies in the execution though-
Ledgers are created randomly.
Expenses are dumped under “Miscellaneous.”
Customer advances sit in “Sundry Creditors” for years.
When your trial balance looks like a dumping ground, no MIS report can save you.
I once reviewed a startup where all advertising, influencer payments and PR spend were clubbed under “Marketing Expense.”
₹4.3 crores worth of spend with zero detail!
When an investor asked, “How much of this was digital vs offline?” the founder had no answer.
Oops. Deal gone…
Tip: Create granular ledgers in Tally. Split marketing into Digital Ads, Influencer Fees, Events and PR etc.
Do the same with revenue streams. This one-time effort makes your MIS 10x sharper.
MIS is survival
Founders often think MIS (Management Information System) is for large corporates.
Wrong. Even a ₹10 crore company needs it.
An investor doesn’t want to see raw Tally data. Obviously!
They want clarity.
Month-on-month revenue by product line.
Gross margins after accounting for discounts.
Ageing of debtors, especially the ones stuck beyond 90 days.
Cash flow forecast for the next 3 months.
If you can’t present this in a clean Excel or PDF within 24 hours, you look unprepared.
A SaaS founder I worked with raised Rs 8 crores primarily because he had his MIS in place.
He could show his MRR, churn, and receivables by customer segment at the click of a button.
Investors didn’t have to “believe” him. The numbers spoke for themselves.
And this goes a long, long way in establishing trust.
Common ground realities in India
Cash vs Accrual confusion
As basic as this sounds, many small businesses record sales only when cash is received. Investors expect accrual books: invoice raised = revenue booked. If you run cash books, switch immediately.Personal expenses through business
Petrol bills for the founder’s car. Groceries on the company card. Foreign travel with family coded as “Business Development.”Trust me, investors hire people like me who can spot this instantly (haha 😉).
GST mismatches
If your books show ₹5 crore turnover but your GST returns show ₹4.5 crore, investors will question the missing ₹50 lakh. Always reconcile books with GST 3B and GSTR-1 before sending MIS.Inflated Debtors
Founders show “₹2 crore debtors” to impress investors. But 40% of that is unrecoverable beyond 180 days. A savvy investor will cut that number in half. Always age your receivables and make provisions for bad debts.
What investors really want to see
It is not rocket science. They want three things:
Accuracy – Books that tie back to GST, TDS, and bank statements.
Consistency – Same treatment of expenses and revenues month after month.
Transparency – Easy-to-understand MIS with no hiding.
If you can show this, your valuation automatically holds more weight. If you can’t, they will discount your numbers heavily.
I have countless deals fall apart only due to “differences” between founders and investors over books.
Practical steps to get investor-ready
Monthly book closing: Don’t wait till March. Close every month. Reconcile bank, GST, TDS.
Chart of accounts discipline: No dumping everything into “Miscellaneous” or “Other.”
MIS pack: At minimum, prepare:
P&L with segment-wise revenue
Balance sheet with receivables aging
Cash flow statement
Documentation: Keep invoices, agreements, and approvals neatly stored. Digital folders work fine. Nothing frustrates investors more than missing backup.
External review: Get your CA or finance head to review before you share. One round of clean-up saves embarrassment.
Final word
The fastest way to lose investor interest is not your pitch deck or your valuation ask.
It’s your books.
I call it like I see it - Founders who respect their books get respect from investors. Those who treat it as an afterthought end up with down rounds.
So before you spend another rupee on pitch design or PR… just open your Tally, clean up your ledgers and prepare a sharp MIS.
That’s what will actually unlock the cheque.
As always…
To all those with a mission in life,
VijayBhava!
P.S. If you found this newsletter helpful, do share it across with your entrepreneur friends who will find this useful!
Thank you, and have a lovely weekend.