Reasons Business Fail To Get Investment – Part Two

Obtaining business investment is one of the most challenging tasks a company will undertake, this is especially prevalent for any small business that lacks the board and range of skills often required to secure business investment.

In part one of this article we looked at forecasts and what a company needs to give to receive business investment. We now look at one of the biggest fault area we see in proposals that come through us.

Tell Me What I Want To Know – Ask what an investor wants to know about your company. Think of this in terms of selling your house. The first things you promote to any buyer are the price, benefits of the area, number of bedrooms etc. In other words, the things your buyer is looking for.

With this in mind we always ask why business owners fail to grasp these principles when seeking investment. When selling your house you don’t shout about how good the heating system is, or how efficient the kitchen appliances are, at least not until your buyer is interested.

So, don’t make the same mistake with your business.

An investor wants to know what is in it for them, what the benefits are to them in investing in your business. Once you have their interest, then tell them about how efficient your processes are, why your business is a better bet than your competitor etc.

Too many companies fail to grasp this concept and hence fail to secure business investment.

The key is to think of your business through the eyes of the equity investor (or business angel), this is often easiest achieved by getting a third party, unconnected to your company to read your proposal.

If you want us to look at your proposition before you go seeking investment, or want us to manage the whole business investment process for you then please contact us here, or add your comments above.

Author Byline – By David Farmer

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