Why Investors Won't Fund Your Business?

[moonchild]

Investors typically receives thousands of application from a lot of founders trying to get a piece of their capital to grow their business, but the reality is not many people are able to get the capital, in this article we will deep dive and find out why.

Most business owners are unable to attract capital because they don't have a proof of concept, their ideas are just ideas they did not test them and haven't gotten any demands for what they've offering, investors are in business go make money and won't give their capital to such businesses.

Another factor is lack of spell out benefits, if you want to go in business with an investors, tell them what's in it for them and how they can benefit and do not make it all about yourself.

 

[Etini]

I have been able to get equity funding for my business and I would have to agree with the original poster to a large extent. Investors want to put their money in businesses that are practical and they can follow the idea to ascertain how it develops. When your idea is vague and ambiguous, they won't commit a penny to fund such businesses.

The second point the original poster raised about investors seeing the benefits they stand to gain from your business proposal before investing is very true. They have to see the long term and short term financial benefits they stand to gain before they can put their funds in your business.

 

[Yusra3]

Investors have a tendency to be picky in terms of projects they will support, as they always try to back business that minimizes risks and delivers a good return on invested capital. Investors most commonly cite as reasons for their funding rejection; there is no model of the business, doubts in regard to competitive advantage, insufficient opportunities of the market, uncertainty about management team, implemenation of the project, no proper financial statements or sales the valuation is high in comparison to other companies or several “focus areas” of investor differ from the company. Having every aspect of any potential problems that can occur covered in your presentation will help to make it more convincing and therefore raise the chances of you getting the investment money.