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Appropriate Commission Amount?

Posted on 12/3/14 at 12:18 pm
Posted by Ole Geauxt
KnowLa.
Member since Dec 2007
50880 posts
Posted on 12/3/14 at 12:18 pm
Need an opinion from you tycoons.
I'm in a situation between 2 guys that I already do pretty good business with. They're sorta negotiating against each other and I'm in the middle.
One of the fellers has a wad of money he wants to buy a certain company with, and the other feller knows the target company's "right people" to talk to.
Feller 1, the money man, hasn't been able to get his foot in the door to make an aquisition deal, but, Feller 2 can get him in there, slick.
Feller 1, is an old fashion deal maker and is used to and very willing to paying cuts, handshake profit and just whatever it takes to get a deal done.
Feller 2, the contact man, wants those finder, intro., and "doing business" fees.
I'm in the middle of this thing, and have become the negotiator of the negotiations, the middle man of the middle man. What do yall think the approiate % fee should be for Feller 1 to pay to Feller 2?

*** important notes, I think.?
1. I'm not making a fee, not a dime on this.
2. This deal is less than 5 million.

TIA
Posted by Janky
Team Primo
Member since Jun 2011
35957 posts
Posted on 12/3/14 at 12:27 pm to
quote:

1. I'm not making a fee, not a dime on this.


Why not?
Posted by Ole Geauxt
KnowLa.
Member since Dec 2007
50880 posts
Posted on 12/3/14 at 12:36 pm to
like I said, I'm already making decent dollars on deals with the guys already. I'd just as soon that it continues, w/o rubbing it in their face. ya know?
Posted by hungryone
river parishes
Member since Sep 2010
11987 posts
Posted on 12/3/14 at 1:03 pm to
Can't you ask Feller #1 what the deal is worth to him?
Posted by Janky
Team Primo
Member since Jun 2011
35957 posts
Posted on 12/3/14 at 1:10 pm to
quote:

like I said, I'm already making decent dollars on deals with the guys already. I'd just as soon that it continues, w/o rubbing it in their face. ya know?


Ok, gotcha. Good luck.
Posted by Ole Geauxt
KnowLa.
Member since Dec 2007
50880 posts
Posted on 12/3/14 at 1:14 pm to
yeah, but in most cases, it's human nature to answer the way that fits that particular humans nature the best..

is there a standard, semi-rule on this sort of thing?
I'm guessing 3-4 pts, on 4-5 Million dollar deal,,, what yall think?
Posted by Bussemer
Heading South
Member since Dec 2007
2519 posts
Posted on 12/3/14 at 2:13 pm to
If I was the broker I would ask for 5. If I was the money man I would offer 2.5.

So somewhere in between is probably fair.

Posted by Janky
Team Primo
Member since Jun 2011
35957 posts
Posted on 12/3/14 at 2:27 pm to
I am not sure if it is the same thing or not, but my dad is a semi-retired turbine broker and deals with purchasesof many millions of dollars. His cut is typically 3-3.5%
Posted by Ole Geauxt
KnowLa.
Member since Dec 2007
50880 posts
Posted on 12/3/14 at 4:41 pm to
so, it's kinda looking like the 3 to 5 point range. I sorta thought that, but, wanted to hear some thoughts.
tks guys..
Posted by PlanoPrivateer
Frisco, TX
Member since Jan 2004
2788 posts
Posted on 12/3/14 at 6:00 pm to
Do these two fellows know each other? Seems like they compliment each other at least as far as this situation. Get them together and become the deal maker.
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