If you are considering investing in a private project - whether it is investment capital or lending money for a commercial project - you must determine your investment motive in order to understand why customers buy the products of that project.
If you do not find an answer to the question, you should look for another investment opportunity.
Why should you specify reasons for “investment”?
In a report published by the American Forbes magazine, writer Bruce Roberts says that researching the reasons that motivate you to invest will help you understand the essence of opportunities more, define their context and visualize their results, and thus direct due diligence for the appropriate potential investment.
A business needs a compelling reason to establish and promote it effectively, both internally and externally.
The challenge for investors is to find and ascertain what the real reason is.
The writer explains that the presentation to the investor looking at what the project is will make you try to assemble the disparate elements of the business plan, while identifying the reasons will provide a basic understanding of the business that supports the investment.
Follow in the lead investor's footsteps
In the field of investments, there is a phenomenon called the lead investor.
Oftentimes, many entrepreneurs follow in the footsteps of another investor when deciding whether to invest.
And if this investor has experience in the sector and a solid track record, then this approach certainly has its advantages and saves a lot of effort.
However, basic questions are generally best, and someone who is unfamiliar with a particular industry is less inclined to make inaccurate assumptions.
Therefore, investors still have to understand the reasons for investing at least in order for their steps to be considered.
Reasons to invest are not the same
The writer points out that there are many reasons to start a business, and you should take into account the strength of the reasons that drive you to create a business that always guarantees financial success, while searching for the conviction of the entrepreneur that supports the possibility of success of your project by knowing the inevitable challenges of the emerging company.
But rest assured that for-profit businesses and investment opportunities will not succeed unless you can consistently provide products that satisfy customers.
So focus early on understanding your target customers, the business opportunity your company offers, and your customers' core motivations.
Find the causes quickly
The process of reviewing companies for investment usually starts with reviewing the backgrounds of the entrepreneurs and the size of the target market.
Entrepreneurs naturally want to tell you their story and their potential success in their own way.
You can evaluate their presentation, and you should spend enough time examining the company's main sales system.
With unlimited investment options, you must use the opportunity efficiently, and then delve into the reasons that motivate you to invest primarily in order to achieve success.
And when you find a clear answer to this question, make sure that you are now qualified to move to the next step, which is the next question: What are the best investment strategies that you can resort to.
The Millennial Money website published a topic entitled "The Best Investment Strategies" by Grant Sabatier, in which he discussed his investment experience and the strategies he used to successfully manage his investments until he earned a million dollars in just 5 years.
According to Sabatier, the two most frequently asked questions she gets from Millennial Money readers are: What are you investing in?
What are the best investment strategies?
He says the best investment strategies are the ones "you can maximize your return while minimizing your risk, and while you can invest in anything, the best investments I've found are stocks, bonds and real estate".
The writer asserts that these investment principles are tried and true, and that they succeeded not only with him, but "helped millions of people build wealth and achieve financial independence."
He points out that everyone has their own situation, but there are some general principles that "you have to pay attention to if you want to build wealth."
Guaranteed investment
The writer points out that many new investors take opportunities in long stages instead of buying shares of major companies, but he prefers companies such as Amazon, Netflix and Apple, and says that they are all among the best stocks. For starters.
He recalls those who recommended buying these shares for the first time when it was Netflix in 2004 at $1.85 per share, Amazon in 2002 at $15.31 per share, and Apple in the era of the iPod Shuffle at $4.97 per share, and wonders: Where are they now?
How much are their prices?
5 tips to avoid useless investments
Sabatier returns to provide 5 tips to avoid getting involved in useless investments:
Never buy a financial or investment product from someone you recently met.
Getting returns of more than 12% per annum is ridiculously difficult.
Don't invest in what you don't understand.
If a friend of yours referred you to an investment that he said made him a lot of money, he's probably a jerk too. Most of the "investments" people sell have probably worked once, and you simply can't try them again.
There are no "super rich secrets" that anyone will sell you for $500, or that you can actually profit from unless you have hundreds of thousands of dollars.