Entrepreneurs Should Be Cautious When Raising Investment

Bangalore: Organic growth no longer glitters when it comes to companies. No one now wants to be a part of or invest in a company that grows from zero dollars to one hundred billion dollars in 70 – 80 years. Investors are now interested in companies that can achieve the growth in a decade like facebook. Everyone wants to build and be part of such companies and you won’t get there being organic.

Inorganic growth, through funding and acquisition, is the only way to be there, and that is what most companies prefer today. Now, is this model perfect? This is a difficult question to answer; all one could say is that this seems to be the right way now. This has given much importance to seeders, angels, venture capitalists and equity funders in the present business world. If you have a decent business idea and a great team, it is not at all difficult to find equity investments in the present world. There are investors who are literally hunting for such would be entrepreneurs. But, being new to the field and most of these would be entrepreneurs or new entrepreneurs have very limited knowledge about the intricacies and different aspects associated with raising these funding. As a result they end up making many mistakes that puts their whole plan in jeopardy. Let us go through a few such aspects that need to be corrected.