You probably have the perfect new opportunity to offer to an investor. You considered it very carefully, prepared your business plan, hired experts to undertake your feasibility study, and lobbied the project to all your local and international contacts, just to make sure your business will take a good kick start.
It looks good, but sometimes it might look too good to be true in the eyes of investors. They all know it comes with a specific risk — a bell ring for any private equity participant.
Under a different scenario, you have the most attractive business for sale. You’ve been through a lot of trouble to set it up and make it profitable. It’s probably very well organized, healthy and prosperous — an ideal acquisition candidate for a retail, strategic, or financial buyer. On the other hand, liquidity might be an issue — a temporary one, or a detrimental one — and your business might be facing problems, either due to shifting economic conditions or because your offering may be outdated and slow to adapt.
Bottom line: Whether you’re looking for an exit from your existing business or inviting interest for an equity partner, your chances of success are limited — unless you shift your perspective and view your business or opportunity through the eyes of the investor.
A messiah is traditionally seen as a savior — but it’s been a long time since one came along! If that’s your mindset, prepare for disappointment, especially if you’ve set tight timelines or your cash reserves are running low.
Any investor or buyer starting discussions with you is focused on several critical factors. The first is return on investment, which must justify the risk they are taking. If it doesn’t, they’ll walk away. After all, you’re seeking partners because the risk is too high to manage alone. And no stranger will want to share that risk if they suspect hidden issues. Investors do not like surprises — especially negative ones.
Investors evaluate many opportunities. Yours is just one of many on their radar. They are scanning for the opportunity that offers maximum returns. Their evaluation is based on numbers, not sentiment — and that’s a perspective you must adopt too. Investment and sentiment don’t tango.
Buyers, especially experienced ones, can analyze the presented information quickly and accurately. They’ve reviewed similar opportunities before. While instinct plays a role, it’s never the only deciding factor.
Of course, not all leverage is on their side. You might have a genuinely promising project or business for sale. But be realistic. Seek out buyers or investors who offer more than capital — those who also bring knowledge, networks, synergy, management strength, and scale. These added-value qualities are what make a deal truly worthwhile.
So stop waiting for a messiah. Be reasonable, transparent, and flexible. That’s the best way to attract an investor — and avoid waiting forever.