November 22, 2007
Posted by pvenero
I am looking to bring a fairly new international franchise into the country that I think will be a hit. I have a couple investors lined up that I am looking to hopefully have them invest. I would then look to run the franchise with their investment. They are the money and I will provide the workforce. Is this a 50/50 split?
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November 22, 2007
Posted by Charcan
( 1 rating )
As an entrepreneur I can say that you should tell investors whatever they want to hear to get the money and then build or do what you want to do.
I heard Nolan Bushnell mention this comment during a speech, and you can see he is living proof that it works.
Looks at Bushnell's latest work at uWink. He told investors it would be a hot spot for young women and it was a genius move of telling investors what they wanted to hear to get the money and build what he wanted.
nice job Bushnell!
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November 22, 2007
Posted by chris-lott
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You are only entitled to what the signed contract stipulates. All deals are unique.
I would advise the following metrics: One, sell only 15-30% of your business. As your business grows you will likely need additional funds to handle the growth. At no point sell more than 49 percent. If you ever do, you'll obviously end up losing control of your company, which should be avoided at all costs.
Before working with VC firms look for Angel investors in your area. Lastly, make sure your percentage entitles you to the majority of voting rights in the company.
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