Three Small Business Mistakes That Turn Off Investors 

Do you get the feeling that your new business is turning off the very investors you were hoping to impress?  Perhaps you are looking for partners among other companies with similar interests.  Yet you can’t get anyone to take you seriously. Why is that happening?  

So many entrepreneurs work hard day in and day out.  They believe in their goals and have laid the groundwork to succeed. However, they miss the mark with investors.

Here are three common reasons that investors walk away from a good deal on a growing business. Each problem is relatively easy to address, and it should encourage investors to give you a serious look.

Three Small Business Mistakes That Turn Off Investors 

Bad First Impression

Did you know that some business managers are so busy that they don’t see their surroundings any more?  They know the level of effort that is driving their business forward, and they aren’t focused on aesthetics.  Who can blame them? As long as the work gets done right, does a coat of paint matter?

Unfortunately, the way your business looks outside and inside can affect how investors view your chances of success. The peeling paint on the door may look shabby to the passer-by. An office space may be cluttered and seemingly disorganized.  The warehouse may not appear to be secure or safe.  The vehicles may look poorly maintained. 

Investors are just like any other person. What their eyes see will inform their actions. In each instance, they see a business that doesn’t care enough to put its best foot forward.   A coat of paint on the door, organizing the warehouse and decluttering the office may take a weekend, but they are worth it.  Perhaps simply renting a storage unit will relieve the clutter in your office or warehouse. If you want to impress them, you may need to go the extra mile to demonstrate that your business is worthy of their support.

 

Lack of Safety Protocols and Equipment

In the warehouse, there are no safety zones or even safety posters.  The construction site lacks the basics, such as composite mats to protect the ground. There are workers who should be in safety vests and hard hats, but they aren’t wearing them.  The job is getting done, but an investor will see red flags.

Lax safety protocols and a lack of proper safety equipment will turn off investors immediately.  They aren’t looking for a lawsuit. Furthermore, they expect to do business with someone who is disciplined and proactive. 

The problem for many business owners who are still struggling with the bottom line is that these protocols require training which can be expensive.  The equipment is expensive too.  Without it, however, they won’t attract the capital they need to stay in business.  The entrepreneur needs to address these challenges for the sake of the business, not just the prospective investors. 

 

Shoddy Bookkeeping

Many terrific business managers are terrible at bookkeeping. If this is a small business, they may be trying to handle the books themselves Or, they may have passed it to someone else who is equally unqualified.

An investor will take one look at shoddy bookkeeping and wonder if it is designed to hide the truth about the small company’s finances. Plus they know that poor bookkeeping can lead to massive problems at tax time.  

Entrepreneurs often have a limited number of employees. They can’t afford an expert. In this case, they should consider outsourcing bookkeeping to ensure that an investor can have confidence in the entrepreneur’s endeavors.  The business owner should feel more confident once every dime is accounted for.

Once you have your premises looking clean and organized, your safety protocols covered, and your bookkeeping tidied up, you will be in a better place as a company. You should have much better luck with investors the next time they visit.

FG Editorial Team
The Founder's Guide Team - Asian Associates with dynamic elements out to make a change.Thank you for visiting our site! If you do have any questions or inquiry, feel free to contact us through our links and please don't forget to follow our social media accounts. It would be our pleasure to help you in any way we can. Always Remember: "Proceed to Succeed". Hoping to hear from you soon!

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