When to use direct investment
One of the most effective ways to expandor modernization of all spheres of business are, of course, direct investments. Today, without a doubt, this is the most effective investment tool for Russian companies. It is clear that this kind of investment has two sides of the coin - both positive moments and negative, both for the investor and the company.
The basic advantage of this type of investmentis to obtain the necessary funds for business development. It is worth noting the fact that the invested company or firm can also invest the so-called intangible assets - information and technical support of the project, the investor's authority, his business connections. It's no secret that the sources of financing direct investments in the person of large and reputable companies positively influence the image.
There are also disadvantages
The main disadvantage of infusion into your companythird-party financial flows is the imposition on the activities of certain, often, significant restrictions. It is clear that a company or a fund that carries out direct investments, in the end, expects to receive a profit that should not be less than a third of the investment amount, and in some exceptional cases it is much larger. It is worthwhile to understand that the invested funds can be returned as the sale of the stake to another investor, and directly to the co-owners of the company.
On the other hand, there is a proverb aboutthat paying and ordering music. In full measure, this popular maxim can be applied to the problem under consideration, since, whatever types of direct investment are not used, they should work effectively, at least from the point of view of the investor. Thus, the administration of the investing enterprise should understand that certain, often, significant changes are possible, both in marketing policy and in the management of managers. For example, many investors sanction the appointment of CFOs in the companies invested.
Where and how to find sources of direct investment financing?
Before rushing into the search pool sonecessary investor, it is worthwhile to carefully analyze the state of affairs at your own enterprise, since there are some aspects that should be solved and determined before direct investment is received.
- Presence and literacy of business plan development. There can be no doubt that investing in a start-up company is largely a riskier occupation than in a proven field. The document does not need to be presented in its canonical form, but it must clearly reflect the direction, forms and methods of using the funds received, and also display those types of direct investments that can be used most effectively.
- Level of professional skill of the teamand, first of all, management, should be determined not by words, but by certain achievements that characterize the ability of managers and executors to achieve the goals set by the project.
- Dynamics of business development. It is clear that there are few investors who are ready to invest in unpromising, especially unprofitable projects.
- And the last owners of the company should clearlyDetermine what part of their own business they are willing to give in return for direct investment. It is worthwhile to understand that many investment funds are ready to cooperate only if they receive at least a blocking stake, and more often, a control one.
Only having comprehended and appreciated the above-stated aspects it is necessary to try to search for investors, either in the person of investment funds, or in corporations, or addressing to private persons.