As an individual, choosing how to invest your money (jump in on GameStop? Hmm, maybe best not) can be stressful. But as a business owner, making investments on behalf of your company can be a make-or-break decision that, understandably, requires significant time and consideration.
Although investing as a business is risky and difficult, it’s also vital to strengthen your company’s financial viability and to grow. Here’s a look at the key risks when making investment decisions on behalf of a company, and how to mitigate them.
Risk #1: Financial Loss
Financial loss is, not surprisingly, the number one concern for business investments. If the risk of financial loss seems too high, most investors will back away from the opportunity. The priority for your business is growth, of course, so this creates a catch-22: a significant financial loss can damage your company’s chance to expand, but you can’t grow without investing.