What to Consider Before Investing in a Start-up

Investing in a start-up can create great opportunities but also comes with great risks. The average person doesn’t obtain enough capital to even be a qualified investor in business. As a business professional who has played a part in launching multiple start-ups as a founder, co-founder, board member or investor, there are many attributes that one should look for as an indicator of success. Let’s take a look at a few things to consider before investing in a start-up company.

The Founders

The very first thing you want to do is research the founders. Their educational background can be very important but experience and expertise are also things to consider. Ask yourself, how do they stand out from others? Does listening to their business idea inspire you? Remind yourself that not all founders have a track record of running a businesson their own. Which brings me to who these founders surround themselves with.

Look into the Team

A start-ups team is just as important as the founders themselves. Their goal is to live up to and execute the founder’s vision to the best of their ability. With start-ups, you want to have people on your team who are jacks-of-all-trades. Having a mix of beginners and experts is also something to keep an eye out for.

Evaluate the Vision

It’s easy for start-ups to sound fresh and exciting but their vision needs to be clear. Is there a market for the product or service and how will everything be executed? So many businesses receive funding from tons of investors but failed to deliver a proper execution plan. With no substance, businesses have no chance for success.