10 Important Secrets About Investing
10 Important Secrets About Investing; Investing in private companies is not easy, they are long-term investments and fraught with risks, and can not convert profits into cash easily. So we should do a lot of work in advance to increase your chances of success. To illustrate, here are 10 steps you must do before you start any Quantum Code investment:
10 Important Secrets About Investing
1. Talk with the CEO: You should not invest in a private company unless she had held discussions with the Chief Executive; it will provide you with invaluable insights about leadership and implementation capacity. You’ll also know the risks associated with work, to decide whether you believe in this company strategies and the extent of its chief executive capabilities.
2. Follow the diversification strategy, carried out on the basis of your project: it is unlikely that you will be a successful investor if you invested your money in two or three companies only. Data from Cobalt Code Foundation proposes a sound approach to how to invest the money in 7 to 10 companies. And you have to determine how much you want to allocate to the asset class, and then diversify your investments to reduce the risks and increase the likelihood of success.
3. Talk to an expert: Find the person familiar with the industry you’re interested in, and consult an investor or a banker specializing in investment affairs, and an expert in the field who intend to invest in it. If you do not know anyone, I spend a few hours in the social networking sites that include people in professional jobs, to help you learn some of the details that you Ottaghlha.
4. Talk to your customers: whenever you can get more information the better. At a minimum, you have to talk with 3 to 5 customers who use the product you are promoting. As you must understand the reason for them their love of the product and how important it is to them. Are there any other alternatives for this product or not, and why? If any party to the competitor cuts prices does remain faithful to this product without the other? More importantly, you will be advised others to use it? It classifies customers into three categories: Promoters, and they are loyal customers, others recommend the company’s products and services, and contribute to their growth. Neutrals and customers who could easily replace this product otherwise. The Class III, who understand the detractors product because they are unhappy with him and criticize him constantly. For this, your attention shed on the nature of the company’s customers, and if their reputations are promoting the product they use it a positive sign for the company’s reputation.
5. Understanding Growth: How the company will continue to grow and whether growth? Will work grew as a result of increasing the number of distribution points, or whether there was a successful rise to the level of sales in the stores themselves? As the primary growth by increasing sales in the stores themselves, more valuable than purchase an additional number of them. It is obvious to understand the growth, it is the investor that looks at the basic financial statements, budget, income and cash flow details. You can also inquire at the consumer division of the retail sales level.
6. Know the exit strategy: You have to realize what the roads which allows you to exit the industry in which it operates to the public. And how much you will need a business time and effort even evolve and grow. What are the limits to that? If the IPO was not within the foreseeable future, it is their potential buyers when you reach this stage?
The IPOs in the sector of consumer goods and retail, which are more rare in the technology sector. While in fact, the merger or acquisition is still the most common in the consumer goods sector from other industries. It has reached the value of mergers and acquisitions in the consumer area almost twice the value of Internet and software deals in 2012, according to the latest data.
7. Talk with your lawyer: Show each document to your lawyer, Legal Documents associated with investing in complex private companies. You may not interest you all the points spoken by your lawyer, but you have to understand, at least.
8. Understand your business: Before investing in the company, then use the product and study the project well. The more you understand the industry in which they operate better, I felt more comfortable about your investment in them. Well, as you know very well maintained, and the company invests in the sector and you do not clear the background you have it.
9. Calculate the return on each commodity: Surprisingly, many companies in recent years have attracted investors, despite the fact that they lose money on every “good” sell. Unfortunately, many of these companies do not have any plan to change this situation or processed. So, if you invest in a beverage company, for example, you have to know how to win or lose the company in every bottle they sell. The formula is simple, ask revenues from the full costs, including marketing and distribution costs.
10. briefed on details of the Ice 9 Technology deal: Check the ratings of similar companies to your company on the basis of several factors, including income, net income and the rate of growth, risk and capital structure; strong, companies do not have successful investments always, especially if the valuation is too high.
In the end, any investor needs to get as much information as possible about the work that is interested, and sector data and the deal, as it is not a sure bets on such things. In general, the more you know about things, your chances of success were greater.