Build your professional network on facebook via our app Go to app
 
<< Prev  8 of 9 in Topic  Next >>
Posted in Community :

Startup World

 
Started by : Veena Gupta, Analyst, Blackstone Group   07 23 2010 13:35:27 +0000
Industry : Investment BankingFunctional Area : Getting Started(Entrepreneurship)
Activity:  47 views;  last activity : 08 09 2010 16:37:15 +0000

Many of us have got a strong business idea which we foresee has a  huge financial potentials with a ready market who needs our product or service. From all accounts, we are convinced that your business will be a success, and even become the next big thing! All we need is capital, and investors who are willing to support our vision and convert it to reality.

http://faculty.cbpp.uaa.alaska.edu/afef/investor2.jpg

Yet after looking far and wide for potential investors, all we get are rejection letters. The banks, venture capitalists and angel investors all said “No” to our proposal. We are unable to convince them of the viability of your business. Here we are, with the “perfect” business plan, and yet no one wants to support our idea.

So users, what are the 10 reasons for which Investors reject funding requests?

 
 Refer 747
Share
 
 
  Rate : 
 
 
 
 
  7 1 1 0 0
 
 
 
 
 
 
 
 
 
 
 
 
 
1 2 3 4 5
1 Question of Sustainability.
2 Past record and experience of business
3 Poor performance
4 CAUTIOUS ATTITUDE
5 viability, marketability, managerial capacity
6 People understand Finance better now
7 No credible ROI plan

Question of Sustainability.

idea posted by Veena Gupta Analyst, Blackstone Group

When we talk to an investor, we will invariably present ourself as the “heart and soul” of the business. Investors, however, look beyond having us in the business, and expect us to do the same. They will want to see how we plan for the sustainability and continuity of the business, even though we are long gone. Our business plan must demonstrate that the business can remain viable and continue to operate even after the founders have left the endeavor.

7
0
  
by Rathin Deb, Advisor and retail consultant, currently as Branch Manager, Tower Infotech Ltd  | 07 25 2010 14:38:59 +0000

Actually according to me everything starts with project viability report. After going through the report if the invester feels the venture will be profitable invests

Yes Veena besides other points the investewr looks for sustainability of the business profile.

0
  
by S. Muralidharan, Executive Director, Knowledge Foundation & Campus Around the Corner  | 07 24 2010 04:22:15 +0000

Notwithstanding the viability, marketability and the best strategy, there exists an element of perceptible danger in sustaining one's initiative due to the volatile nature of global market.  Therefore, best of the initiatives are buried in incubation stage itself.  After Enron, Satyam, Lehmen Brothers, etc. precedence, the investors have become even more cautious and prudent to safeguard their funds.

0
  
by NATTERAJA R. ARIKRISHNAN, GM-Projects, Bentec Electricals & Electronics Pvt. Ltd  | 07 23 2010 17:35:27 +0000

Yes I agree with you Ms.Veena Gupta.

Starting or doing a business is ok, but one should have enough resources to continue it and he should have the capacity to sustain the difficult periods which is very important in business and in turn enhances the creditability.

 

Add your argument:

Past record and experience of business

idea posted by Aditya Sharma Insurance Advisor/Analyst, LIC OF INDIA, ICICI LOMBARD

Thanks Veena

They want to see your past record wheather it is satisfying and of course your experience of the business that you are proposing to start. This can be one of the reason for rejection.

1
0
  
by Mayuram V. Sankaran, Legal Advisor, Legal Profession  | 07 23 2010 15:11:04 +0000

The sluggishness of market hit by recession may be another discouraging factor.

Add your argument:

Poor performance

idea posted by Mohammad Bakhsh Consultant(Civil), Rail Vikas Nigam Limited

The investors are more wise than ever before,they will only go for investment if the reasonable return is expected.

1
0
  
by Mohammad Bakhsh, Consultant(Civil), Rail Vikas Nigam Limited  | 07 26 2010 02:44:00 +0000

The basic envelope is poor performance.The bird's view tell the telltale sign and significantly help the investors to go for funding.

Add your argument:

CAUTIOUS ATTITUDE

idea posted by s.baalu Consultant, XYZ LTD

NORMALLY BEFORE SPENDING MONEY PEOPLE THINK TWICE.THIS ATTITUDE COMPELS  INVESTOR TO TAKE ADEQUATE CAUTION AS INVESTMENT IN BUSINESS ALWAYS CARRIES AN ELEMENT OF RISK.

0
No supporting Arguments for this idea
Add your argument:

viability, marketability, managerial capacity

idea posted by kanukurthy sudershanrao Operations Manager, Andhra Bank

having a good business idea is not enough, one should be able to convince the investors about the viability, marketability of the product/service and ones managerial capacity for the investors to say yes to the idea

0
No supporting Arguments for this idea
Add your argument:

People understand Finance better now

idea posted by Shashi Kumar U Manager accounts & commercial, Mazda Concrete Products Pvt Ltd

The public who invest in the market are now more knowledgable than what they were 5 or 10 years before. They analyse, study , discuss and follw the market not only Indian market but also International market. So we have investers who can read the company and their growth before investing.

0
No supporting Arguments for this idea
Add your argument:

No credible ROI plan

idea posted by Jaygopal Raghavan Marketing Manager, Landmark Group

What investors require is a credible ROI to be in place. Because when they are investing their money, they would like to know when and how much return they would get. A credible ROI can easily be worked out by your chartered accountant. Care should be taken to ensure that there indeed is a return because investment analysts and the likes can very easily see through a cooked -up figure and such a business idea wouldnt pass muster.

If your returns are going to take time, state the facts clearly and elaborate the reasons for the same. There is no point in cutting short an ROI from say 5 yrs to 3 yrs just because an investor might not be interested. There are different types of investors out there who might look at a long term return on investment if the business idea is good vs a short time return full of risks.

0
No supporting Arguments for this idea
Add your argument:

Add your Idea
Idea* : 
Add your argument:
edit in rich text ...
Could not find any idea interesting in: "What are 10 reasons for which Investors reject funding requests?" ? Click here to add a new idea...

Found the idea contest "What are 10 reasons for which Investors reject funding requests?"  interesting ?  Click here to refer to your connections and communities
Leading Recruitment Consultancy
  • Create a confidential Career Profile and Resume/C.V. online
  • Get advice for planning their career and for marketing of experience and skills
  • Maximize awareness of and access to the best career opportunities
Viewers also viewed
The Indian equity market witnessed a see-saw motion in the first few months of 2011. As such...
 
980 referals 16 arguments, 631 views
The best part of FD schemes are that they are one of the safe investment avenues and there is...
 
1 referals 8 votes, 2309 views
I believe that it's the luck which keeps the lion's share in a personal interview. This usually...
 
4 referals 13 answers, 221 views
more...  
 
More From Author
Twigmore is a new app on facebook, a start up which focuses on Travel and friends, i.e., it will recommend traveling to the destinations your friends and their friends have traveled. This is because they bellieve that while most of the travel...
I second MR.Saket jain here. There is no monopoly in any field if we take the global prospective.
Budding business owners should go virtual wherever and whenever possible. In a fledgling startup, the last thing you need to worry about is excessive infrastructure or expensive overhead. It’s already a difficult enough task to generate income...
more...