Over the last few years, private investments in bio- and green technologies have grown substantially in Australia. Yet private investors - individuals looking to invest their own capital - have always maintained interest in a variety of industries, such as contracting, consulting, entertainment and online businesses.
The key to a great private investor-investee partnership is finding a good match, whether it's a strictly financial relationship, or a mentorship - an exchange of industry knowledge and connections. These more self-directed agreements are attractive to entrepreneurs seeking start-up capital because private investors are also willing to take greater risks with their money, and are even prepared to withstand possible financial losses, an ideal arrangement for start-up companies that have a hard time securing funding from more traditional financial institutions.
Private investors, in turn, look for growth potential, fair priced equity (ownership in the company in the form of stocks), skilled management, a tight business plan and what value they can bring to the company. Since private investors are willing to take such a high risk, they usually look for a high return (upward of 10 to 30 times the original investment) within a five to ten year period and with a defined exit strategy in place.