Investors may decline to invest in a company if an entrepreneur has unrealistic expectations or if they are unenthusiastic about the business. A consulting company like Cavendish Maxwell can provide advice for investors and entrepreneurs who are faced with investing or business opportunities.
It is important that an entrepreneur displays passion when pitching a business idea, but there is a boundary between that passion and an unhealthy ego and arrogance.
Unrealistic Entrepreneurial Expectations
One of the biggest turn offs for investors is an entrepreneur with unrealistic expectations.
Some entrepreneurs can feel entitled to receive funding from investors because they believe that their product or service is perfect. They refuse to accept the possibility that their business might have an issue or that they might have missed something in their design.
An entrepreneur might provide an unrealistically high valuation. This makes it obvious to potential investors that they did no work in analysing the market and in doing research on the competitive landscape.
These kinds of entrepreneurs will often end up complaining that investors do not get the position they are coming from. They do not accept the constructive criticism from experts only trying to help because they do not realise that they are setting unrealistic expectations for themselves.
Enthusiasm About Business
Investors can tell how enthusiastic an entrepreneur is about their business and this factors into their decision to invest in the company or not.
Investors look for entrepreneurs that are hungry for success. These are entrepreneurs who are so committed that they focus on their planned business full-time and do not refuse weekend meet ups. Another negative sign of a low commitment level is an entrepreneur that gives up too soon.
There are investors who make the decision to invest only after seeing an entrepreneur’s reaction to the rejection and seeing their determination and belief in their business.
Investors take factors like an entrepreneur’s expectation and level of enthusiasm into consideration when making investment decisions. They want to see that an entrepreneur puts in a good amount of research into the business and sets realistic goals and expectations to meet.