From the course: Determining Market Size for Your Product or Service
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How investors view your business
From the course: Determining Market Size for Your Product or Service
How investors view your business
- So I'm going to actually take you through a step-by-step of how an investor thinks and the calculation that they go through in order to arrive at whether or not they should invest in your business. This is going to be very valuable to you to walk through, and we're going to apply this to your own business. So let's say that you have an investor that's interested in investing in your business and they want to invest $1 million. Right, sounds like a lot of money. That's good. And for that, they expect a 10% return. So generally speaking, every investor wants to hit a home run. And hitting a home run for an investor really means a 10x return on their money. So that's what their expectation is when they go into an investment. They want to make as much money as they can out of it. So given that, they would actually need the $1 million times the 10x return. They would get a $10 million return at the sale of your company.…
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