Small businesses are missing out on private investment due to misaligned expectations with potential investors, according to an independent study.

Innovate UK, the UK’s innovation body, discovered that business leaders are consistently undervaluing investors’ most desirable values for investment.

Both leaders (96%) and investors (84%) agreed strong management was the most important value for scale-up success, along with demonstrating drive and passion for future success.

But the shared core values ended there as poor communication was a deal breaker for 84% of investors, compared to just 46% of businesses.

78% of investors thought sharing chemistry was important, versus 53% of businesses, while a lack of adaptability or resilience was a vital for 87% of investors (compared to 58% of businesses).

Dr Ruth McKernan CBE, chief executive of Innovate UK, said:

“Attracting investment is often a challenge for innovative businesses and the brilliant people at their heart.

“We are increasing our focus on connecting innovators with both government funding and venture capital investment, to turbo-charge their journeys to success and the UK’s economic growth.”

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