The pitfalls of investing in private businesses

Before investing in a private company, understand and know what you are getting into, or you risk not getting back your money. PHOTO ILLUSTRATION: PIXABAY
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It is risky to invest in a privately held company unless you are part of the team that will be running the show.

Being a minority shareholder means you do not get any voting power and will be unable to influence the management of the company. So you might not get any financial returns if the firm opts to use any profit for operational needs instead of distributing it to shareholders.

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