"While the equity investor is looking at us, we are also looking at them," Jetwing chief Hiran Cooray told a business forum in Colombo.
"Do we want this person on the board? Are they coming to grow the business, or are they going to put so many rules and regulators, are they going to restrict us?"
He was speaking at an LBR- LBO forum on private versus public equity.
Sri Lanka's Jetwing group set up a separate vehicle Jetwing Symphony, to raise about a million US dollars in equity.
Cooray said they had a foreign investor they were happy with and local investors as well, but it was not easy to match everyone's needs.
The firm went to private markets because they were looking for strategic partners who could wait for some time, and go public later when they were giving results.
The group was building four hotels; two was under construction with one nearing completion.
He said a hotel took three years to build and another two or three years to start making money. But even in private markets it was not easy to find strategic investors.
"What we realized was that a not a lot of them do not have the patience," Cooray said.
"Some were looking for deals, or instant money."
He said for some foreign private equity funds they talked to, a million dollars was too small and they were looking at 8 to 10 million dollar deals.
Cooray said though the deal had a clear exit mechanism through a listing one investor had wanted a guarantee that Sri Lanka's equity markets had the funds to take up a sale.
"How can I give a guarantee to that?" he said. "Then they said 'Fine, you come and list in Singapore. So these are some of the issues that we had to handle."
He said many of Sri Lanka's larger firms were also building their own hotels.
Sri Lanka is emerging from a stock bubble which burst from around 2011, but has seen double digit increases in tourism arrivals since the end of a 30-year war which has seen a rush to build hotels.