How Does Decreased Investor Confidence Affect Entrepreneurs?
Decreased investor confidence can have several impacts on entrepreneurs:
1. Difficulty Securing Funding: Investors may be less willing to provide seed capital or participate in funding rounds. 2. Higher Cost of Capital: Investors might demand higher returns to compensate for perceived risk, increasing the cost of capital. 3. Increased Scrutiny: Entrepreneurs may face more rigorous due diligence processes and stricter terms. 4. Reduced Valuations: Lower investor confidence can lead to lower company valuations, impacting the ability to raise funds on favorable terms.