Investing in start-ups for investors is not an easy task. They have to think about the risk related issues and long term investment factors before investing and that is why they prefer confident and adaptive start-ups Listed down are some important factors that investors look for investing in: Ultimately, any investor would dig deep into a start-up and looks for the following factors before investing in any start-up.
1. A STRONG MANAGEMENT TEAM
Investors look for a credible and an established management team who are capable enough of delivering goals, executing business plan and handling responsibilities as they believe in strong work-force & execution rather than just vanilla thoughts.They value fresh ideas and innovations but they also know that to execute them well, a skilled and experienced work-force is mandatory.
2. MARKET SIZE
Any investor would like to receive bigger returns and hence they want to ensure the addressable market size and the style of approach of the start-up they are investing in. Investors look for ventures that can achieve momentous profits with decent financial projections and maintains its impact on the targeted market.
Investors particularly look for highly experienced entrepreneurs as they believe these entrepreneurs know how tominimize risks related to start-ups. Maximum investors take interest in those start-ups which have experience of high performance andexecuting correct business plan so that theycan turn their investment into their expected ROI.
4. BUSINESS MODEL
Every investor seeks for a clear and comprehensive business plan of a start-up which illustrates that there is a market and scope to make a return. They closely study the details and presentations defining the business plan and consult their business valuation expert before finalizing their investment.
5. EXIT STRATEGY
A robust exit strategy is essential in order to liquidate the investment. Investors want the start-ups to maintain the strategic exit plan right from the start including the time frame and optimizing it for an appropriate return.