The Worst Thing You Can Do When Raising Money For Your Business

real estate real estate as a business Nov 21, 2022
 


If you're raising money for your business, the worst thing you can do is rely on one or a few investors.

This puts them in a position of power and they may not offer the best terms. What if they pull out? It's important to be clear with them and let them know that you have other prospects interested in your business. There's no arrogance in being honest with your investors - they'll understand.


Here are some other reasons why you should not rely on just one /handful of investors to make or break your deal: 

  • It gives the investors too much power and they may not offer the best terms.
  • What if they pull out? You'll be left scrambling to find new investors.
  • Having a small number of investors may limit your options and bargaining power.
  • It could be more difficult to get favorable terms from just one or a few investors.
  • Relying on just a few investors could jeopardize the success of your business deal.

 

Raising money for your business can be a difficult process, but it's important to remember not to rely on just one or a few investors. This puts them in a position of power and they may not offer the best terms. It's also important to be clear with them and let them know that you have other prospects interested in your business. Having too many investors could limit your options, so make sure you carefully consider who you partner with and consider having a lot of them in the pool.

 

Marcin Drozdz

The information contained herein is for general guidance on matters of interest only. This information contained herein is not intended to provide you with any advice on financial planning, investment, insurance, legal, accounting, tax or similar matters and should not be relied upon for such purposes. M1 Real Capital Inc, Marcin Drozdz is not a financial, legal or tax adviser. You should assess whether you require such advisers and additional information and, where appropriate, seek independent professional advice. You understand this to be an expression of opinions and not professional advice. You are solely responsible for any actions you take with the content and hold M1 Real Capital Inc, Marcin Drozdz or any of his affiliates harmless in any event or claim.

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