There are many ways to invest in order to get a return on your savings. But if what you really want is to invest in companies, without intermediaries and without another destination for your funds, the number of possibilities is considerably reduced. Next, Global Commercial Capital Investment Group explain how to invest in Lean Startup companies, do not miss it!
Startups are small companies focused on achieving rapid growth based on innovation. Many of these projects have become millionaire businesses, such as Airbnb. If at the time we had invested in a startup of this type, today, we would have done a good business.
Invest in Lean Startup companies
The more traditional investments made by individuals are not used to finance “directly” companies. However, several movements have emerged today with the aim of creating social investments . In them, in addition to obtaining a return, the investor manages to give real meaning to their savings and helps companies to improve their businesses.
Investing in Lean Startup companies for the first time can be complex, but that is not why you should not try. Today, this type of investment has become a popular and very tempting alternative.
However, the characteristics are different. To be able to invest in Lean Startup companies you need to have good management, a strong founding team, creativity, and good human capital. However, most importantly, be clear that it is a high-risk investment. The growth of that company may be rapid but its decline is the same. On the other hand, being a scalable business, the possibilities of return can be multiplied a lot as well.
5 Practical Tips For Investing In Companies Through Crowd Lending
Next, we leave you 5 tips to keep in mind when lending your money through crowdlending :
# 1 Study The Platform
It is very important to know the platform through which to lend the money. Law 5/2015 on the promotion of business financing, dictates the obligation on the part of crowdlending platforms to have a Participatory Financing Platform License granted by the CNMV. It will be a seal of trust to verify that the chosen platform has the necessary licenses to operate.
# 2 Diversification
Consider diversification. How much money do you plan to invest through crowdlending? Divide that amount as much as possible in different operations, between different loans and companies. In this way, you will be able to diversify your portfolio as much as possible. Also, offset some operations with others that may be delayed and achieve the maximum possible profitability.
# 3 Study of Additional Guarantees
When investing in loans to businesses through crowd lending you will see the information on each application. The guarantees provided by the borrower for the good end of the loan will also be available. These loans usually have the personal endorsement of the partners or other additional guarantees. It is important to assess this information when deciding whether to invest or not. This endorsement or guarantee will cover the loan in case of non-payment of the company.
The guaranteed investments have the endorsement of Reciprocal Guarantee Corporation. They have the obligation to return the capital and interests agreed to date. The refund will be made to investors who have participated in a loan that has this guarantee once they have defaulted on 3 consecutive installments without paying.
# 4 Invest in secured loans
By investing in this type of loan, the investor will achieve an attractive return on his money without sacrificing security. A Reciprocal Guarantee Company guarantees all its invested capital and the agreed interests. These companies have been working with banks for more than 30 years and have 0% bad loans, therefore, in all those operations that had this guarantee and failed to comply with 3 consecutive installments, the guarantee was executed and the Guarantee Company returned all principal plus interest to the lender. Now private investors through crowdlending can also enjoy this guarantee.
# 5 Value Accreditation
The aforementioned Law 5/2015 on the promotion of business financing differentiates two types of crowdlending investors: accredited and non-accredited investors. Any investor who registers on a platform, by default, is considered a non-accredited investor but can request to be accredited.
Request to be considered as accredited investors in advance, and expressly renounce their treatment as a non-accredited client.
Have the accreditation of the contracting of the financial advisory service on the platform’s financing instruments by an authorized investment company.