question about a business idea | TigerDroppings.com
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I Love Bama
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Alabama
Member since Nov 2007
33718 posts

question about a business idea

In my current job I spend a lot of time analyzing markets and performing market/feasibility studies for developers.

I specialize in a specific property type but don't want to go into that here.

My feasibility studies have proven to be spot on for the most part and its something I'm very confident in.

Using apartments as an example. ..

Do you think I could start a consulting company that brings a perfect market to a developer in exchange for 5 percent equity?

Again, I would charge no fee. Just a 5 percent ownership position.

Thoughts?


trillhog
Elite Membership
Member since Jul 2011
18772 posts

re: question about a business idea
a good commercial real estate developer already does this right? or you talking bring a deal to a group of investors and telling them what will work or not as far as the development?
This post was edited on 7/18 at 10:44 am


I Love Bama
Alabama Fan
Alabama
Member since Nov 2007
33718 posts

re: question about a business idea
Kinda. A developer is always looking for the perfect market for a new development. I'm talking about bringing them the market and if they develop give me an ownership position.


barry
Cincinnati Fan
Location, Location, Location
Member since Aug 2006
39831 posts

re: question about a business idea
quote:

Again, I would charge no fee. Just a 5 percent ownership position.

Thoughts?


I'd rather take a fee. I wouldn't want equity in something like real estate.

How would you make your money?
This post was edited on 7/18 at 11:14 am


trillhog
Elite Membership
Member since Jul 2011
18772 posts

re: question about a business idea
quote:

A developer is always looking for the perfect market for a new development. I'm talking about bringing them the market


this is what a good commercial broker does for his listing or for his customer vice versa. by market do you mean good deal on the dirt or by market do you mean telling them what sqft, lease, and what kind of tenants the area is looking for and how it needs to be broke down to make money. do you have CCIM?
This post was edited on 7/18 at 11:29 am


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yellowhammer2098
Alabama Fan
Birmingham, AL
Member since Mar 2013
1241 posts

re: question about a business idea
quote:

I Love Bama



Hiring? Or can I get your current job?

This seems like it could be a good idea unless you plan on having employees early on. It may be difficult in the beginning to pay employees when you're basically only earning ownership in development projects that (probably) don't even have a positive CF yet.


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C
LSU Fan
The Woodlands, TX
Member since Dec 2007
22694 posts

re: question about a business idea
quote:

Again, I would charge no fee. Just a 5 percent ownership position


No one ever lost money selling advise. Charge a fee.


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I Love Bama
Alabama Fan
Alabama
Member since Nov 2007
33718 posts

re: question about a business idea
quote:

ow would you make your money?


Off the noi every year as well as when they sell


RebelOP
Ole Miss Fan
Misty Mountain Top
Member since Jun 2013
11117 posts

re: question about a business idea
A downside I could see is that you would be dealing with so many owners and have to keep track of different agreements and blah blah blah.

Good idea, but that part would need to be thought through more.


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TheLankiestLawyer
Member since Jun 2013
1803 posts

re: question about a business idea
You'd need a non-disclosure agreement on the front end and independent counsel to protect yourself in the operating agreement or partnership agreement.

Sophisticated developers could find a way to screw you if you didn't write yourself some protections into the governing document of whatever legal entity you guys choose to operate under.


Mako
LSU Fan
Baton Rouge, LA
Member since Nov 2011
273 posts

re: question about a business idea
Its a great concept for a side job/creating passive income. It would most likely take years to start seeing benenfits. I would just charge a fee up front.

However, odds are the operating aggreement would be the key here. Would you be voting - most likely not, so as a minority owner you would have zero control on distributions, actions, and other key elements of the business.

Plus, by being an equity owner, you are assuming a piece of the risk of the project if it flops.


I Love Bama
Alabama Fan
Alabama
Member since Nov 2007
33718 posts

re: question about a business idea
Thanks.

Lawyer you too.

It's just an idea and I had much rather have the passive income down the road than fees upfront


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