Any business project starts with an idea, but no matter how beautiful and promising it may be, money is needed to realize it. Investments are also needed for the development of the case. Well, if you have them, and if not? Do not despair! Today, let’s talk about where and how to find an investor for business
How to find an investor for business?
First of all, we need to draw up a clear plan, in which to describe in detail the company, the idea, the competitive environment, the development strategy and the team, if it already exists. Also, the calculations of necessary investments planned profit, profitability and payback period of the project.
Be sure to indicate in what form you are planning to cooperate and how the investor will receive income: in the form of a return of the number of investments with interest, as a share of the profit of the project throughout its life or in the form of a share in the business.
Pay attention to the design of charts, charts, and diagrams. Do not forget that the impression of your proposal will evolve even from such trifles as the appearance of the folder and the quality of the paper on which the business plan is printed.
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When the business plan and presentation are ready, the question arises, ” where to find the investor ?”. There are several options for its solution:
- Friends. First of all, tell us about the idea of your environment, and it is likely that this will help you find an investor for business . Especially this method can help beginners, who do not yet have connections and reputation in the business world.
- Entrepreneurs. Often businessmen, having earned enough money, search for variants of their investment in order to receive passive income. Such people might be interested in your proposal. As a rule, they participate in projects either in terms of return of investments with interest or on the terms of obtaining a share in a business. The second option will somehow limit your freedom in making decisions, so you need to take a very balanced approach to his choice.
- Specialized funds. There are a various investment and government funds, as well as funds supporting entrepreneurship. However, often to receive assistance through their programs, you need to have not only a well-developed business plan that confirms the viability of the project but also own means for its implementation. This option is most suitable for those who need money to develop the current business.
- Venture capital funds. Venture investment is quite common in the West and is gradually gaining momentum in Russia. The essence of it is that investors invest, as a rule, in innovative start-ups associated with new ideas, technologies or products. Such investments are associated with a high risk because it is possible only after a long time to understand whether a project will “fire” a project or not. However, if the investor succeeds, there will be a profit that is many times higher than the investment, and its share in the business grows significantly in value. As a rule, venture investors later sell their share in the business to the project’s founders or other interested parties. Often, investments are made in the form of a contribution to the authorized capital of the organization, but can also be in the form of a loan. The most attractive spheres for venture investors are IT technologies, internet, pharmaceutics, and health. To a lesser extent, they are interested in construction, production, trade, and services.
- Business incubator. There are specialized sites that are created for the implementation of various business projects. To get their support, you need not only to provide a business plan, then also pass an interview or even win a contest.
- Bank loan. If a small amount is required to implement the project, you can contact the bank. To file a loan application you need to provide a solid package of documents, and a guarantee of its return, as a rule, is a pledge of property or surety.
Perhaps the prospect of sending out proposals for funds and companies seemed to you not very bright, and you are thinking about how to find investors on the Internet. In this case, there are a lot of platforms that unite investors’ offers and announcements of entrepreneurs about attracting financing.
In addition, there are such associations as a club of investors. Their work is aimed at reducing risks and increasing the efficiency of activities through the exchange of experience, coordination of actions and pooling of investment potential.
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Now you know much more about how to find an investor for business. Do not forget that the more thoroughly you come to the preparation of a business plan, the greater the probability of success. And more confidence! You do not ask for money but offer mutually beneficial cooperation.