Venture Capital Disadvantages For Your Start-Up Business
Venturing is one the common business capitalizing system which allows business to start with better capital exposure. Many digital businesses like apps and other platforms are started and developed with venture capital. Despite its success inspirations, the venture capital features some disadvantages. It’s not a black campaign towards venture capital, but these should be what you need to consider before acquiring the capital from investors.
Low Rate of Making Money
If you’ve seen some successful businesses with venture capital, you’ve actually seen the success of the one percent. The rests are not likely to make money for real like Best online gambling. In other hands, you’ll spend tons of time to get the funding as the investors would prefer the startup companies with the best business performance. It could be months to years and this amount of time is more than adequate to make real money if you focus to develop your business than find venture capital.
An obligation to Share Your Business Equity
Developing your startup with venture capital would lead you into an inevitable consequence, sharing your business equity. It’s not only the money but also the ideas, time, resources, assets, and the most important thing, your business concept. They wouldn’t be yours fully and you’ll have to share the decision-making process with more brains, your commissioners.
Take Your Innovations and Creativity
As expected, you’re not the only decision maker with venture capital even though you’re the business owners. That’s so sad since you may have to compromise with your innovations and creativity. If you’re a real entrepreneur who wants to fully own and develop the business, venture capital might be not your best option for sure.
Immature Business Scaling Up
In most cases, the venture capital investors usually put a high pressure, let’s say, to CEO. The commissioners even though don’t actually recognize the actual challenges and difficulties faced by the company, would push the business to scale up when the numbers or timeline said so. Venture capitalism decreases your chance to experiment or initiate pilot programs for your own business.
Lack of Business Performances
Studies said that many startup businesses lack performance in the market. The high revenue and sales of ventured companies are considered to be exaggerating claims and not-so-accurate inspirations. In other hands, an independent or bootstrap company performs better and be more competitive in the markets. It’s because of the bootstrapped company has full ownership and dedicated business environment.
Assessing Your Business Competitors
If you’re wondering how to survive a tight business competition, then you should asses your business competitors. Whether you want to create a startup or develop your business, assessing business competitors is actually inevitable to identify and deepen your understanding of the actual competition. Take these following guides to assess the business competitors and get a comprehensive overview for your next steps.
Identify Your Competitors
First of all, you’ll have to identify who you will compete in the business with. These include their products and services and their actual position in the market recently. It’s very important to differentiate your business but stay at the competition at the same time. At this point, the customer perspective into account, about what and why they buy from your competitors? And that is where you should start.
The next step is to do the casual strength, weakness, opportunity, and threat analysis to your business. This analysis is very important to recognize the actual competition in the marketplace. At this point, you need to objectively acquire the findings and insights and perspective could be the valuable input. Knowing what people say about your business, products, and services help to understand your company’s stance and exposure in the market.
At some points, it’s inevitable to sell similar products and services but you still need to differentiate your business. Don’t be pragmatic, take all their offers into your considerations and be objective. It’s possible that you’d find that theirs are better than yours. With these findings, you can adjust, improve, and work on better offers. Developing new products, special offers, or managing prices are some steps which may follow the differentiation.
Business Customer Service
It’s very important to work on exceptional customer services to deal with diverse customers. You should build a relationship with your customers instead of just selling a product. It’s suggested to develop your own customer relations program more seriously. The business continuity is the fundamental elements to survive the competition in the market.
The competition in the market is majorly driven by the pricing. In term of the same product quality, you should be able to offer competitive prices. So, you should recognize the lowest pricing points you can offer while keeping the quality, In other hands, if you price your products higher than your competitors, then logically, you should be able to deliver better quality and services.
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