Investing : An Effective Tool For Small Businesses

1728 WordsNov 16, 20147 Pages
It is often difficult for entrepreneurs to trust investors with their new business because the entrepreneurs have created a business from the start. It comes to the point where it has become their life and trusting an investor to own part of it is always a risk. It is true that entrepreneurs require investors, but they need to make sure that the investor does not start owning the business and making changes according to their preferences. Investing is a natural thing for any person to do and require before initiation of a business. For example, a person starts off a business with minimum funds and then waits until those funds yield profit. For instance, a business requires initial capital to begin and become popular amongst the consumer market. Once it has been established, it will keep on yielding profit in the long run. A good example can of a restaurant where money is required to make a place and get the initial inventory. Once everything has been established, profit is yielded when more and more people come. Investors are an effective tool for small businesses to compete, however many people are reluctant because of uncertainty in the market and increased frauds today. It is true that for a small business to grow, entrepreneurs must be dependent on investors if funds are not easily accessible. Entrepreneurs should have a trustful relationship with the investor and should make written contracts, so no issues occur afterward. The choice of whether or not an
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