Arnold, Bruce & Doerfler Insurance Blog
Every type of business has some risks involved. But, there are some businesses that come with higher risks compared to others. If you are a startup company and it contains a lot of high-risk factors, it may be difficult for you to get people to invest in your products. You should be ready to deal with a lot of things as it will be an uphill battle.
Factors That Determine If A Business Is High Risk
Investors will want to look at your business and decide if they are going to take a gamble or not. Here are some factors that will affect their decision:
Niche Industry. It is natural for investors to want a high return on investment. If your business is based on a unique idea, some investors may still be wary if they found out that there is no room for improvement.
First-time Entrepreneurs. You can easily get investors if you had a one-man team before that has succeeded in running a business. On the other hand, if you have an entire team that is all first-timers, you will receive more skepticism from investors.
High Turnover Rates. There are certain industries that are more liable to experience a high rate of failure. A good example is a restaurant business that is unable to stand out from the rest, hence become unsuccessful. If you do not want to belong in this category, make sure you have a unique and strong product that can set you ahead of the competition.
Require a huge amount of money in advance. While all businesses require putting money up front, some industries need bigger amounts for their investments. This makes people have some doubts if your business can pay off. For example, a new automotive company would need a lot of money for testing and designing new cars.
Negative Public Image. Some types of businesses have difficulty in getting investors due to their niche, for example, gaming site or adult entertainment. Some investors will not give your business their money because it may affect their image.
If your business belongs in the high-risk category, you can still make it work and become successful in your industry. Also, make it your priority to protect your business with the right insurance coverage.
At Arnold, Bruce & Doerfler Insurance, we aim to provide comprehensive insurance policies that make your life easier. We want to help you get the insurance that fits your needs. You can get more information about our products and services by calling our agency at (503) 222-1951. Get your free quote today by CLICKING HERE.