If you want investors to be confident in financing your business, show them you know the risks your business is up against and are working to avoid them. Here are five ways to get started.
If you’re looking to raise money for your company, it’s critical you understand your risk profile. Here’s why. Most investors and lenders, like banks and venture capital firms, are essentially professional risk managers; they invest or lend money by managing the risk that the money will be repaid or not. So, your job when seeking capital is to reduce the investor or lender’s risk as much as possible.
The key to reducing risk is to identify and accomplish “risk mitigating milestones.” A risk mitigating milestone is an event, that when completed, makes your company more likely to succeed.
Below are five key “risk mitigating milestones” that will reduce the risk of your failure and thus make it significantly easier to raise funding for your company:
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