The Three Data Mistakes Investors Notice Before Founders Do

Every founder believes their data is valuable. It’s a reasonable assumption, data underpins growth, customer insight, product development and, increasingly, business valuations. But when it comes to the high-pressure environment of raising capital or negotiating an acquisition, assumptions aren’t enough. Investors notice gaps, inconsistencies, and misjudgements long before many leadership teams do.

These are the three data mistakes that quietly undermine credibility, and deals.

1. Overstating data’s role without quantifiable commercial value

It’s one thing to claim your data is driving growth, improving retention or informing product development. It’s quite another to prove it in financial terms.

Too often, founders rely on qualitative descriptions of their data’s importance, while investors expect a clear, defendable valuation or at least measurable commercial outcomes.

When pressed, many leadership teams struggle to demonstrate how their data contributes to revenue generation, cost reduction, or competitive advantage. Vague assertions do not inspire confidence. Sophisticated investors want to see a direct line between data assets and enterprise value.

2. Treating data as infrastructure spend rather than a monetisable asset

It’s a common scenario: businesses view their data as an operational or IT issue - a cost centre. They invest in data lakes, analytics tools and compliance processes, but rarely take the next step of treating data as intellectual property that can drive licensing opportunities, inform M&A value, or attract premium investment.

By framing data as a monetisable asset rather than just a technical resource, leadership teams can change the tone of investor discussions. Data valuation shifts the narrative from “what we’ve built” to “what it’s worth”.

3. Ignoring compliance risks and governance weaknesses

In the excitement of fundraising or exit planning, it’s easy to overlook the regulatory and governance aspects of data ownership and usage. Yet these are precisely the issues that investors, especially those operating across jurisdictions like the UK, EU, and US, are laser-focused on.

Poor data hygiene, unclear ownership rights, or a lack of demonstrable compliance can reduce the perceived value of data, or worse, introduce risk that derails a deal entirely. With tightening data regulations and heightened sensitivity to consumer privacy, even minor oversights can become major red flags.

The Opportunity: Getting Ahead of Investor Expectations

The good news? Each of these mistakes is avoidable. Businesses that approach data strategically - and invest in credible, independent valuation - position themselves not only to meet investor expectations but to exceed them.

For founders and leadership teams preparing for funding rounds, acquisitions or strategic partnerships, recognising and addressing these data pitfalls early can be the difference between a strong deal and a stalled conversation.

At Data Valuation Partners, we work with clients globally to turn data from an operational talking point into a boardroom-strength asset. Our independent valuations help organisations demonstrate data’s contribution to enterprise value, mitigate compliance risks and drive stronger negotiation outcomes.

Discover how we help organisations value their data, confidently: https://www.datavaluationpartners.com/how-it-works