What Are Business Investment Opportunities?
When an investor has capital to spare, one of the ways in which that capital can be increased is through business investment, i.e., putting money into an enterprise with a view to earning a share of the profits generated by that enterprise.
Business investment opportunities usually refer to the chances to start one’s own business with the capital in hand. They also refer to opportunities for investment in someone else’s business. In the former case, the investor and the seller do not continue their relationship once the deal has been struck, but when an investor puts money into an enterprise, an ongoing business relationship begins. A business for sale can also be considered a business investment opportunity.
Types of Business Investment Opportunities
Business investment opportunities come in a wide and diverse range. There is no lack of choice when it comes to these opportunities, and an investor can pick the kind that suits him or her best, in terms of budget as well as preferences.
Some common types of business investment opportunities include investment in inventions and innovations, joint ventures, partnerships, home based businesses, online businesses, rack jobbing, businesses for sale, distributorship, dealerships, network marketing, co-operatives and franchises. These opportunities range across a gamut of verticals including media, the arts, hospitality, healthcare, marketing, IT, real estate, travel, retail, and research and development.
From the viewpoint of the investor, there are two basic types of business investment – venture capital and angel investment. Venture capitalists are those who pool their financial resources to create a substantial volume of capital, and they invest this money in business enterprises. Angel investors are individuals who invest their capital in businesses; often these are start up ventures whose operators need funds to get their enterprise under way.
What Makes a Good Business Investment Opportunity?
While, generally speaking, a good business opportunity is one that yields the maximum profit with the minimum risk, the decision to pick a particular business to investment can be quite subjective as well. So personal preferences, skills, and one’s own experience come into play here. For example
Some of the fields which include lucrative business investment opportunities are real estate, information technology and retail.
How to Evaluate an Investment Opportunity
An essential element of a business opportunity is risk. There is always the chance that an investor could lose the money invested in a business if that business fails, or fails to live up to its potential. So it is important to ensure that you separate the wheat from the chaff when you choosing from among several business investment opportunities.
How does one identify a potentially lucrative business investment opportunity? There are various aspects that must be considered in this regard. To start with, you should examine the value proposition of the enterprise in question – what is special about the products or services. Does it fill a perceived need? You should understand the market, its size, growth potential and so on, and whether the business has a good chance of getting a share of the market. Examine the costs involved, and ensure that you are aware of the risks of needing to put more money into the enterprise if required. Another important aspect is the time involved – you should know how much time it will take for you to begin getting returns on your investment. And of course, you should have a clear idea of the volume of potential profits. When you take all these factors into consideration, you will find that it is easy to pinpoint business investment opportunities that are likely to bring you good returns with less risk.
Questions That Simplify the Evaluation Process
There are also certain questions you should ask to minimise the chances of making a poor investment that brings you little or nothing in the long run. The answers to these questions will give you a clear picture of whether a particular business opportunity makes financial sense or not.
- Is the business plan a feasible one? Does it have a fair chance of success in the market?
- Has the revenue model been worked out properly?
- Is there a competent team in place? Trained, experienced personnel make all the difference between success and failure in business.
- Is there adequate demand for the product or services in question?
- Has the target consumer been clearly identified?
- Is there a sound marketing strategy in place?
- What will make this company stand out in the marketplace?
- What obstacles to success lie ahead? How will these be dealt with?
- What is the condition of the market? What economic factors could affect the success of this business?
- What are the investment costs involved?
- What are the likely returns on investment?
Where Can You Find Business Investment Opportunities?
It is not hard to find just the business investment opportunity you are looking for. There are several service providers in this field, who feature a database of attractive business opportunities on their websites. These websites are a boon to business investors, who are able to easily access a host of business investment opportunities that are likely to bring them good rewards. Some such sites include Envestor, bytestart.co.uk and gobignetwork.com.
You could also try out sites such the UK Business Angel Investment Network