It's be awhile since I've been on Barista Exchange so please forgive me if I'm asking a question that's already been answered ad nauseum.   I'm looking for resources on how to do a valuation of my startup, in order to present that information to potential investors.  Also, I'm curious as to how people are developing agreements with investors.  In other words, how do I ask someone for money and what do I offer them in exchange for their money?  What are some ways that I can construct that agreement? 

Thanks in advance

Jon

Views: 272

Reply to This

Replies to This Discussion

In reference to investor agreements... If you're doing simple loans from individuals you can use a basic 1-page promissory note that lists all the details and terms. This is very easy to do (you can find many examples online) and serves as something official in writing that both parties can sign and reference. Startup capital fundraising is a daunting task - I know because I'm in the middle of it.

Don't be afraid to ask anyone, but make dang sure you're prepared to answer any and every question they may have. If you don't have a solid business plan with realistic numbers to begin with, you shouldn't even think about asking anyone for money.

Good luck!

Thanks Jonathan for the response.  So how are you going about raising capital for your shop?  What kind of ownership are offering for an investor?   Are you figuring out the value of your company at the point that it's profitable so the investor will know what they're investment will be worth?   I'm very green at this "raising capital" thing. 

Jonathan Pascual said:

In reference to investor agreements... If you're doing simple loans from individuals you can use a basic 1-page promissory note that lists all the details and terms. This is very easy to do (you can find many examples online) and serves as something official in writing that both parties can sign and reference. Startup capital fundraising is a daunting task - I know because I'm in the middle of it.

Don't be afraid to ask anyone, but make dang sure you're prepared to answer any and every question they may have. If you don't have a solid business plan with realistic numbers to begin with, you shouldn't even think about asking anyone for money.

Good luck!

There are a lot of different ways of doing it, but I wanted to retain 100% ownership of the business (and eventual profits). So I'm only soliciting fully amortized loans at negotiable rates and terms.  They vary from 0-5% and are a few hundred dollars to $25k. Again, structure it the way that is right for you and that makes the most financial sense.

"Venture Deals: Be smarter than your Lawyer and Venture Capitalist" by Brad Feld and Jason Mendelson is amazing.  

There are some good chapters on debt and it will help simplify some of the terms/deals your may encounter.  It's definitely more focused towards tech startups than coffee shops though. Check it out

http://www.amazon.com/Venture-Deals-Smarter-Lawyer-Capitalist/dp/11...

Nicholas,  This is awesome!  Thanks so much for sharing.  I'll definitely check all this out. 

Reply to Discussion

RSS

Barista Exchange Partners

Barista Exchange Friends

Keep Barista Exchange Free

Are you enjoying Barista Exchange? Is it helping you promote your business and helping you network in this great industry? Donate today to keep it free to all members. Supporters can join the "Supporters Group" with a donation. Thanks!

Clicky Web Analytics

© 2022   Created by Matt Milletto.   Powered by

Badges  |  Report an Issue  |  Terms of Service