Why is No One Investing in Your Business?

Funding is a real life crisis for most entrepreneurs, and can be a hassle.

The difficulty of this alone has led to the closing of many businesses, some founders have gotten discouraged and many have been looked down on or advised to quit by potential investors.

But why isn’t anyone investing in your business?

Well, here are a few reasons why that might be the case:

1.    Your Business is too Unique

The thing with investors is that they aren’t willing to try anything new, your business must already have a proven model from another business that proves successful. There’s the widespread belief that it isn’t always the first person who tries a thing that succeeds or does well.

For entrepreneurs, it’s innovation over invention, because invention is too big a venture to start and a risk to take; you’re attempting to change what has always been and humans do not take change well, talk more of Africans.

However, it doesn’t mean hope is lost. If you’re introducing something new, try making sales on your own first, and have a certain amount of followers/customers, to prove to investors that they may be investing in something revolutionary.

2.     No Need for Funding

Not every business needs funding. If you’re a service provider, for example, you will have problems raising funds because such a business is majorly supposed to thrive on referrals and marketing.

Businesses like Consultancy, Web design, Copywriting, will have no need for major fund raisers and if you do attempt to pitch your business to investors, it may look like you have no idea what you are doing.

3.     You Haven’t Made Any Profit

It’s a bad sign if your business has not made any profit at all.

When investors find out that this is the case, they are not so eager to throw their funds in, because it doesn’t seem promising.

Plus, it may be an indication that your service, problem, staff or potential market size has a problem.

To impress investors and have them consider investing, be ready to prove how profitable your business has been, show workings with financial figures proving that you’re going to be even more profitable with funding.

4.     Growth is Too Slow

It’s a red flag when your business has experienced no growth or extremely slow growth.

The chances that an investor will consider your business is much higher if they observe that your business has the potential for exponential growth because it means large ROI for them within a short time.

 If your business does not meet this criteria, it may be difficult for you to get funding.

5.     A Shallow Understanding of Your Customers

Your business stands almost no chance if you don’t understand who your target customer is. You should have things like the target demography, problems, replacement products, wants and all other relevant data. This is the only way to have your brand positioned as a solution.

If you haven’t done your due diligence, it shows and investors will believe you are either not serious about the success of your business or you have no clue what you’re doing.

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