How To Test A Business Before Investing
September 8, 2020 (Investorideas.com Newswire) You tend to invest in small and medium business - it is at least understandable and tangible. There you can get good returns with reasonable risks.
There are a lot of offers on the market. You open any other investment platform, bulletin board or aggregator - there are hundreds and thousands of them. But it's not that simple.
Today let's look at live examples of how not to give money to crooks/fools and choose really adequate live projects. As a rule, scammers are superficial and everything is easy to find out - it's just a matter of skill.
Having looked through > 5 000 different projects, I can literally in 1-2 minutes distinguish a real proposal from a known nonsense - you will succeed. In general, read it.
Any reasonable investor understands that there are always risks. Especially when investing in small businesses. Miracles do not happen - the market changes, competitors do not sleep, etc. So one of the first questions for the business in which you potentially want to put money is "what are your risks, please tell us?
Some of the applicants for investments "do not worry" and speak about the absence of risks. Do not continue communication - in front of you are either inexperienced fools or fraudsters.
As an investor you have 3 main risks
- Risk of not receiving/incompletely receiving the yield (they promised an average yield of 25%, in fact it was less or none at all).
- Risk of losing the body of capital (all closed/closed, the investor lost up to 100% of the invested amount)
- Risk of illiquidity (the investor has invested money, promised to return on demand within 3 months, on the fact of "dynamite" and delay the terms).
Check your business as a "mystery shopper"
There are many hidden financial pyramids in the market. Most often they are disguised as microfinance organizations and credit and consumer cooperatives. But there are also "pseudo hairdressing salons", companies engaged in bankruptcy bidding, etc.
We recommend a "mystery shopper" test. Order the products of the company, pass the "path of the client" and much will become clear.
Appreciate the product yourself (its competitive advantages, history, strengths and weaknesses).
Take a look at the website/mobile application of the company, which attracts investments (how convenient it is, how native, etc.).
Pay attention to the social networks of business (if you are told about 10 years of successful work, and the first entry on conditional Facebook was made 2 months ago - this is a reason to think and ask questions).
Call the company under the guise of a customer and make an order.
Look at customer reviews on the Internet. If it is a retail product with a mass buyer, there should be a lot of reviews (positive and negative).
Make a full audit of the company's presence on the Internet. Check domains and addresses
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