A modern-day investor has hundreds of options in front of him, all offering their own sets of benefits. The new boom of technology has brought a revitalized energy towards the startup culture.
You may invest in a startup because of your interest or its potential. But investing in a startup can be really healthy for your business in many ways:
1. Stay a step ahead by Joining in Early:
In 2012, the Thomson Reuters Capital Research Index did an analysis of the startup business industry. The overall venture capital had been returned at a 20% yearly rate for the past 16 years.
While bonds and public equities gave minimal profits of not over 7.5% and 9.5% respectively.
Startups also have a few setbacks like a comparatively larger amount of risk involved as compared to some safer investment options. Yet the higher return potential and low need for overhead potential makes an undeniable combo.
2. Become an integral part of a team that needs you:
Investors that invest their money in startups and smaller businesses have an edge over others. They are often found to be more involved with the management of the startup and its progress.
That is a big advantage of investing in a startup. You can get onboard with the company and let them hear your point of view on things. Investing earlier allows you to acquire more shares in a venture and hence add more value to your suggestions in the management meetings.
Having an influence on the direction the company progresses is a trait not many investments will offer you.
Many startups these days are run by young individuals who have the required technical abilities to launch a product but do not possess the marketing abilities and experience to make the venture a success.
Investing in a startup will allow you to build and train a team of professionals which you can deploy on other projects.
3. Innovate with Fresh Minds:
It will give you an opportunity to entertain the entrepreneur hidden inside you. You can help out aspiring entrepreneurs by investing in their projects and assisting them in making strategies and coming up with simple solutions to their issues.
It can serve you well if you’re looking to experience the journey yourself. You’ll run a startup yourself, deal with its ups and downs and also play a role in growing it.