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Approximately 90% of new businesses are fully funded by their founders in the early stages of their creations. It is fair to say that entrepreneurs are investors who build a thorough understanding of the opportunities around them to create an income.
Their investment is often in time, money, and effort to create value in the new business. However, entrepreneurs also collect a lot of knowledge as they build their companies. They gain deeper insights into the market and can utilise their expertise as a way to build valuable investment portfolios and strategies for themselves or for their business. So, here are 5 high-ROI investment ideas for entrepreneurs:
#1. Stocks and foreign exchange trading
Depending on your industry sector, you may have developed a good overview of the market fluctuations, either in terms of assets or currencies. So, it could be a fantastic idea for a knowledgeable entrepreneur to use an online trading platform as an avenue for profit. Ideally, this type of investment strategy requires nerves of steel and an appetite for risks. Yet, entrepreneurs who are active in the financial sector can apply their expertise to build a profitable portfolio.
#2. Invest in other companies
Nobody knows better than an entrepreneur what a successful company looks like. So, you could turn to public equity research services to identify potential companies that could join your investment portfolio. It is important to understand that an investment in public equity is an allocation of shares to a private investor in a public company, making you essentially a passive owner. As an investor, you do not get to decide on the future strategy of the company, which means it is crucial to do your research before choosing to invest.
#3. Consider commercial investments
Commercial properties can be a source of passive revenue for the landlord. As an investor, commercial property investment strategies can be divided into different categories:
- Typical retail unit or office let to a company via a strictly contracted lease
- Co-shared working places for growing companies, independent freelancers, or remote contractors, using flexible rental agreements
Depending on the location and the type of property, one strategy may be more effective than the other.
#4. Buy a company
There are many reasons why buying a company may be a fantastic investment. First of all, it could provide a new path for growth as you can acquire a new market and new skills in an M&A. Alternatively, it could also be an easy solution to start a second business.
However, the purchase of an existing business comes with its own challenges, including staff morale, difficulties to renegotiate existing agreements, and the need to secure several months of working capital to support cashflow. But it could be a beneficial decision in the long term.
#5. Invest in R&D
Research and development is the part of business operations that seek to develop, design, and improve products and technologies. R&D is not only a crucial driver of economic growth, it can also become an actor for innovation and progress. Many sectors also have investment calls for their R&D divisions and strategies. Consequently, joining large R&D programmes can also provide access to market-leading findings and technologies.
As an entrepreneur, investments can become a constant race for profits. It is crucial to stay focused and identify the most valuable options for your money and your entrepreneurship goals.
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