Is Your Business Ready for Investment?

If I walk into a crowd and ask business owners to raise their hands, many hands would shoot into the air. Of course, that gives off the impression that many businesses are up and running. But I wouldn't stop there.

Since a healthy, well-run business ought to always be on the lookout for expansion opportunities, I'd ask how many of those businesses were ready for growth and investment.

Again, many hands would shoot into the air. Who doesn't want growth? Who would ever turn investors away? But I'd ask those who said their business was ready for growth the following questions. See how many boxes you tick. They're an indication of how prepared your business is for opportunities. They're an indication of whether you're running a business or a one-man, one-woman enterprise, like the little blue kiosk you drove past yesterday.

1. Is your business legally registered?

It starts there. It always starts there. In Nigeria, any business that can be rightly called a business must be registered with the Corporate Affairs Commission (CAC). If you're not registered, how do you begin to seek investors? Your business is not even a legal entity. Who would invest in that? How much expansion can you even attempt?

If the thought of getting registered scares you, it's probably because you've heard a lot of rumours about it — the endless files you'll submit, how it takes way too long, and how much you'll pay for registration. The truth is if you investigate the registration process, it's simple. So, is your business registered? If not, when is it getting registered?

2. Do you pay your taxes?

Again, a business that's not legally compliant is hardly a business. Taxes are so important that you don't want to run into the wrong side of the law on this one. You don't know what taxes you should be paying? Talk to a tax consultant. Tax compliance is one of the services we render at Elvaridah.

3. Can your business operations/processes run without you?

If you're not there to oversee things and give directives, does your business have a well-outlined operations funnel? If you have to be there for things to work, if the business can't move without a certain employee, if there's no technology behind your business, how can you think of expansion? You'd only tax yourself to your limits if the business were to get any bigger. You need to build a system for your business. A system that can work without you being physically present or thoroughly involved. That's when you can even call it a business.

4. Are you spending all the profits on yourself as the business owner?

This ensues when you don't yet realize you're running a separate entity. You'll thereby see the business as your money supplier, using all profits for your upkeep. But that shouldn't be. You ought to be building something for the growth of the business. You ought to know, "This amount is going back into the business." It's when you can demonstrate that your business has been growing in your hands that you can conscript more hands into the business in the form of investments.

5. How about integrity and transparency?

Investors are going to want to see it. They'll need account books that show profitability. They'll need to see processes that echo transparency. They'll need to know they're dealing with a business built on integrity. Nothing shady. Nothing suspicious. Nothing that can't be explained. Nothing about missing or untraced funds.

With these 5 things in mind, here's a question for you to answer: If I came into your business today with an investment or partnership offer, would you be ready? Is your business truly prepared for growth?

If not, I'm the person you need to talk to, to fix things up!

But really, what’s holding your business back from taking the next big step?

Have a great week ahead.

- Nkechi