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Started By
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Buying into a business
Posted on 8/2/16 at 1:55 pm
Posted on 8/2/16 at 1:55 pm
This post was edited on 4/24/19 at 10:27 am
11
Posted on 8/2/16 at 1:57 pm to WallsAllAroundMe
How is the business classified? LLC, S-Corp, etc?
Posted on 8/2/16 at 2:21 pm to WallsAllAroundMe
You need an attorney that specializes in Securities / business transactions.
Posted on 8/2/16 at 3:26 pm to WallsAllAroundMe
Which is more important to you, the friend or the potential business?
Posted on 8/2/16 at 3:29 pm to WallsAllAroundMe
quote:How do you know it's cheap? "Cheap" is a relative term. Relative to what?
He basically offered me 10% of the business at a very cheap price
Posted on 8/2/16 at 3:33 pm to WallsAllAroundMe
quote:
Buying into a business
quote:
I have a friend
Be prepared for the possibility of losing his friendship
Posted on 8/2/16 at 3:33 pm to castorinho
quote:
Be prepared for the possibility of losing his friendship
He already said this
quote:
if it fails in the end, the $2k investment won't be missed.
Posted on 8/2/16 at 3:44 pm to WallsAllAroundMe
Two thousand dollars for 10% puts a valuation on the "business" of $20k. What does he need the money for? Because that's not a lot of money. Is he more interested in your time?
It's going to cost close to half that just to get the paperwork in order.
Then sell this business in a year the he has valued at $20k? For how much?
Are you just funding? Will you participate? No offense, but this whole thing sounds very odd. That's probably the nicest way to say it.
It's going to cost close to half that just to get the paperwork in order.
Then sell this business in a year the he has valued at $20k? For how much?
Are you just funding? Will you participate? No offense, but this whole thing sounds very odd. That's probably the nicest way to say it.
Posted on 8/2/16 at 8:39 pm to WallsAllAroundMe
You need to talk to a lawyer if you are serious about this.
Posted on 8/2/16 at 9:07 pm to GenesChin
quote:
He already said this quote: if it fails in the end, the $2k investment won't be missed.
It's not about losing the investment. In fact there could be more friction if the business ends up being successful.
Posted on 8/3/16 at 6:16 am to WallsAllAroundMe
What's in it for him to give away 10% for only 2k? Walk away.
Posted on 8/3/16 at 7:12 am to WallsAllAroundMe
Your friend and the investors set up the LLC and you get the paperwork at the Sec of State office. It costs about $75.00 and it lists the owners on the filing with the amount of stock owned by each shareholder. You are done.
Posted on 8/3/16 at 7:31 am to WallsAllAroundMe
This makes no sense unless your friend is desperate for funds. Never, ever give up equity in a business unless it is absolutely necessary. Something isn't right about this deal.
I'll also echo that it's a terrible idea to be in business with friends.
I'll also echo that it's a terrible idea to be in business with friends.
Posted on 8/3/16 at 8:09 am to WallsAllAroundMe
Company is valued at $20k? What kind of business is this?
Posted on 8/3/16 at 8:16 pm to Azazello
Found his elevator pitch online...
From the Indiegogo Campaign
$2K investment will mainly help to recoup costs associated with focus groups and graphic artists brought together to develop the visual identity for this new business.
Pic of OP & Friend during final Prototype/UAT Process for website development
From the Indiegogo Campaign
$2K investment will mainly help to recoup costs associated with focus groups and graphic artists brought together to develop the visual identity for this new business.
Pic of OP & Friend during final Prototype/UAT Process for website development
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