Is foreign investment the key to saving a failing business?

Sun, Aug 30, 2015


In an increasingly global marketplace, struggling businesses are more and more inclined to look abroad for investment. Sometimes, it’s a case of companies in weaker economies reaching out to stronger ones, but there are also other reasons why it can make strategic sense. If you’re a patriot concerned about your profits being siphoned out of the country, bear in mind that keeping your business afloat will mean you contribute more to your national economy in the long term, as well as employing people. Foreign investment can be a good thing at a national level, too.


The importance of your business plan


Of course, in an ideal world, businesses wouldn’t get into trouble in the first place. The best way to avoid this is to make sure that you always have an up-to-date business plan looking at least three years ahead (looking too far into the future can become difficult because of the increasing number of unknowns). This should help you to stay on top of your finances and to have a clear strategy that you can stick to. No business can be 100% safe because external events can sometimes take them by surprise or completely overwhelm them (as with the financial crash of 2008), but it’s possible to avoid a lot of the common mistakes that lead to failure simply by keeping a level head and paying attention to detail.


Finding the right investor


If things do go wrong and you need help, how should you approach finding the right investor? Again, it helps to have a clear idea of what you want before you enter negotiations. Don’t rush to take up the first offer you get; take a bit of time to establish the sort of deals people are willing to propose. Serious investors understand that negotiation is important. Often, all they will want is a stake of 15% or 20%. If the only way for you to keep going is to let them have a controlling share, make sure the investor who takes it has a good reputation for mentoring and supporting the companies with which they are involved.


Fahad Al Rajaan


One of the areas that businesses around the world are increasingly looking to for financial support is the Middle East, where the booming businesses have made a specialty of investment. Any Fahad Al Rajaan overview, for instance, will show you that he has drawn on his experience at Al Ahli United Bank to strengthen his investment portfolio and support companies in many different countries. By taking a direct interest in the kind of work they do, he grows the businesses he gets involved with – this increases his own profits, but it’s good for all involved.


Finding investment abroad means you are less likely to have to give up shares in your business to somebody with competing interests. It can also act as a bridge into new markets. With the right support, you can bring your business back from the brink and also make it strong.


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