Post
Topic
Board Economics
Re: Would you prefer getting a loan for a startup or getting an investor?
by
wiss19
on 19/06/2024, 09:18:10 UTC
I'll choose to get an investor because I don't yet have experience running a profitable business with positive cash flow. By finding an investor, I must prepare a pitch deck, which forces me to continuously improve and verify my ideas. I also learn how to convince investors. This is a very good experience. So, besides getting a cash injection , I can learn more about the potential of my ideas because I need to convince investors by answering their concerns.
That is actually quite smart but how hard could it be to try and learn things by yourself first before trying to bring in other people to meddle with your own business? Consultants are okay but once you start bringing people in that could alter the direction of your business, it might become too complicated.

There is no shame in being a beginner and learning how things work first and maybe even making a few mistakes. Seems better than letting the decisions be ran by other people who might even do some work before your back.
Having an investor is not like doing a partnership. You may not understand, but if you borrow money from someone or someone else invests money in your business, then you set a profit limit in which you have to give the profit to your investor. Yes, if you have a partner in your profit, then he can interfere in your business and you can say that your business is in the hands of someone else. But if you have good investors, you only have to give benefits to your investors and not involve them in your business.

I think it is much better than borrowing to find good investors who keep giving them a fixed amount because debt is something that once a person takes, he can never get out of debt. If you borrow from someone and he stipulates that you have to pay interest on it, it can be more dangerous for you. I don't think his business can be more successful than if you have a good investor and you decide that they will have a profit in your business, then you give them that much money every month.