| | NOVEMBER 202119best with you. An investor should choose to invest in something they love talking about and are intrigued by. It's more than just diving into a subject. It's researching the domain expertise, spending time with it, and deciding if you should bet on the products that support it. It's also imperative that the startup you're planning on investing in has domain expertise and a deep understanding of that sector.3. Conduct Due Diligence: How will you approach start-up investing, will be unique to an investor and its financial situation. Before going forward with any investment opportunity, the investor should critically evaluate the business plan and model for generating growth and profits. Plenty of research is required before putting the money on the line. To start-off, an investor should be able to answer these questions, Are the policies sound and can the economics of the idea gain traction in the market? What is the long-term plan of the startup? Do they have domain expertise? How big is the market? Why this? Why now? 4. Venture Validation: Many times a company's valuation is the best guess about the company's worth. Looking at the financial data of a company in the early stage might not give many actionable insights. However, running the numbers and looking at the bigger picture is imperative.5. Post-investment Involvement: After making an investment, there are additional contributions that an investor could make to increase the likelihood of a higher return. Such forms of participation include mentoring the startup, financially monitoring, and helping establish business relationships on behalf of your investment.6. Diversification: Investing is inherently risky. With the changing economic scenario, the value of investments can fluctuate. So, it's important to spread the risk across a diverse investment portfolio which includes a mix of higher risk and lower-risk investments. It is recommended to make several small investments in a few different start-ups versus one big investment in one start-up7. Exit Avenues: For investors, when to pause or conclude funding is equally important. Fundraising from investors is about more than just getting the money you need to carry your business forward; it's about building a relationship with them that goes beyond the cheque. Initial public offerings, acquisitions, and subsequent rounds of funding are all examples of exit options. In a nutshell, the startup investment landscape is currently undergoing a renaissance. Investors now have unprecedented access to some great start-up investment opportunities that were initially only available to a select group of investors. There are many different industries, platforms, and forms of returns where risks are high, but rewards enticing. Thus, to navigate this investment terrain, investors should be willing to diversify their portfolios, hedge their bets, and do their respective leg-work of Due Diligence and Market Research. BEFORE GOING FORWARD WITH ANY INVESTMENT OPPORTUNITY, THE INVESTOR SHOULD CRITICALLY EVALUATE THE BUSINESS PLAN AND MODEL FOR GENERATING GROWTH AND PROFITS
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