tolcher started this topic @ 20:15 on 13/11/2007
We have a dotcom startup that is almost ready to seek funding. Owing to the nature of the business idea, we are in need of quite an extensive Marketing budget, and in need of some lesser costs for offices and staff. We are thinking of approaching a marketing company to exchange their expertise and consultancy for equity, and then approaching another funding source for the remainder. We are wondering whether it’s a good idea to split the funding request in this form? I have the impression that whether you seek 100k or 200k for a company that is not trading (and is therefore difficult to value), then the percentage of equity required will be pretty much constant.
RE: Split funding enquiry
theretaildoctor | 13/03/2008 11:49 AM
I trust you have a sound business plan, forecasts, P & L's etc.
If so feel free to contact me greg@theretaildoctor.co.uk for me to have a look through, we can supply NDA's if you need.
We have raised money for concepts in the past, it is notoriously difficult to raise money for an online business that is not ( as i understand ) even trading yet.
there are many things you can do though,which includes optimising the site so the need for spendingsuc a vast sum on marketing decrease. Do you have an idea of where you hope to spend that sort of money ? and what returns you hope to get back.
The main issue here is to get any investor to invest, he has to see what it is actually worth, and if it has never traded, it is worth nothing, and therefore the equity that they will require ( If you get anyone) will want a huge chunk, whereas if you start trading and your numbers are as good as you hope them to be, the equity sell off will be far less, and you will be in a much better position to retain control, or if your numbers are that good, go to the bank or SFLGS
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