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Strategies for Attracting Inward Investment

Investing / 04 Oct 2018

If your new business needs outside funding and taking a loan is not an option you want to or can pursue, one alternative can be to seek out investors who may be willing to purchase a share in your enterprise.

This is particularly likely to be the case when the inward investment you require is substantial, and an interest-bearing debt to the bank has the potential to cripple your business before it even begins to take off. What you may need in such a situation is an angel investor, a seasoned business person with a track record of success and a bank balance to prove it. But what should your approach be to someone who is ready to put up?

Strategy #1: Avoid Family Members

Whilst accepting investment capital from a loved one may seem at first like an attractive proposition, it’s hardly an indication that your business idea is a good one and may be little more than a gesture of solidarity or even an act of charity.

Strategy #2: Be Selective

Once somebody has blessed your project with their capital you are kind of stuck with them forever. But are they someone you want to work with? If your business idea is good enough to attract one experienced investor then there is a serious likelihood that there will be other offers. Take your time and choose the partner whom you feel the most comfortable with.

Strategy #3: Beware of Fallen Angels

Lucifer was an angel too, but he wouldn’t have made for a good business partner. Most business angels, although they might drive a hard bargain, are honorable and value their reputation, but there are a few out there who will just be looking to shaft you. If you don’t feel comfortable with an offer of support, decline it. There will be others.

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