Why Should You Initiate Investing In Startups?
Today, startups actively seek investors for the funds rather than rely on personal savings
Leading an organization and working hard to run it or endowing money in the venture and earning profits? Which one will you choose; the instant choice would be the former option. Millennials perceive that running the organization is a more lucrative deal than thoughtfully investing in a niche company. Attaining returns on the investment is something that can go along with managing your own business. Giant companies like Microsoft, Dell, Apple and Amazon didn't establish merely by personal savings. The investment was crucially needed to raise and expand the business. Similar to the present day, investors were actively sought by then entrepreneurs as well. Potential business strategy, discrete business idea and financial soundness are core factors that are observed by the investors.
Suppose, if someone invested one or two thousand dollars in the mobile company, Apple or e-tailer, Amazon. Then, the dividends of those shares or resell value of those shares would be a lump sum. Recognizing the hidden potential in the startups, require keen observation, market analysis and studying the business model. Even, in this digital era, there are a plethora of investment platforms available, wherein investors can register themselves and seek companies to endow money. Angel kings, Seedrs, Our Crowd and OneVest—are some popular digital investment platforms. Though, it takes an abundant time for entrepreneurs to garner investments through this model while some entrepreneurs consider it essential to raise money without directly approaching the investors.
So, after learning the investment-seeking approach, you would not have fully realized what the crux of investment is, why you should endow money in the startups, how you can be on the safe side while investing in the startups and lastly, how to choose the right startups for the investment.
Here's Why You Should Invest In The Startups
Huge returns are one of the core reasons why you should invest in the startups. Besides the returns, there are various other reasons for initiating the investment.
1. Higher Returns
Thoughtful decisions of investing in the startups can be hugely beneficial as the returns (above inflation) are higher than other types of investments. Furthermore, it diversifies your portfolio investments.
2. Recognition In The Market
The startups you have chosen if, in the future, get recognized in the industry. Then, this recognition acts as a catalyst for your fame too as you are directly related to the organization.
3. Lifetime Savings
Besides receiving returns, the investment is done to secure one's future. Many investors seek companies who are thriving and expanding in the sector. By investing in startups like other veteran investors, you can collect large chunks of savings that can help to lead the life post-retirement.
4. Create Positive Changes
Green financing is nascent investment type, which is highly prevalent in the sector. Millennials contribute in the startups which envision to bring positive changes in the society. By opting the green financing, you can become a part of the positive societal changes done by the organizations.
How To Invest In The Startups?
Investing in the startups does not require any mantra; the only thing you require is knowledge of the business ecosystem. You can't invest money into a newly established organization by reflecting on their product and financial backdrop. There are abundant of other things that you need to consider before coming on a decision.
Nonetheless, investment is not a very complicated process; the mechanism of the investment is although an easy process which requires a bit of practice and understanding. To effectively learn to invest, imbibe some important ways into your mind:
1. Investing Platforms
Now, investing has become a lot easier than before. Unlike years ago, seeking investors and startups is effortless procedure at present. On the internet, you can find various genuine investing platforms, wherein startups introduce their business outline and seek investors.
2. Personal Connections
Besides reliance on the investing platforms, you can visit networking events or help your personal connections who are planning to start their own ventures. By endowing money to known contacts for the business is a safer investment.
3. Register Yourself On Angellist
If you perceive that you lack expertise and know-how for a sound investment decision, then you can register yourself at AngelList India and begin trailing veteran investors. This will help you apprehend the market and build good connections in the industry.
Adhere to the aforementioned recommendations to become a good investor.
This article was originally written and published by Jaspreet Kaur.