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Investor needed for business

Toiletcake

New Contributor
Nov 4, 2007
118
13
17
Recently, I have been working on several e-commerce web based business ideas. I am having the sites designed and built and have come to a point that a partner might be something to consider.

Marketing the sites can be expensive and needs to be done properly. I want to explore my options. So I was curious to know how to approach the idea.

How does one decide on percentages and all the details involved? If I am designing, building, and operating the businesses and the partner is providing the marketing capital, whats that worth percentage wise?
 

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Jorge

Bronze Contributor
Oct 5, 2007
583
103
32
37
Mendoza, Argentina
As far as I've read, the capitalist partner (VC or otherwise) usually wants 51% of the company. For example lets take a look on google (this % are what I remember, maybe they're wrong):

Founders: 15% each (30%)
CEO: 6%
VC: 52%

The other % was distributed between several companies and the Univ that funded the project in early stages.

Hope this helps,
Best wishes
 

australianinvestor

Bronze Contributor
Aug 4, 2007
467
102
25
Australia
Put yourself in the potential partner's shoes, and ask yourself questions that he or she would ask themselves?

How much risk is involved? Based on that risk, what's the minimum return on my money I'd need to make?

Once you estimate the answers to those, you can do the numbers and work out what they'd want.

HOWEVER: equity finance is the most expensive type of finance you can choose. Is there no other way? How about marketing without money first, and seeing if the idea floats? If the idea is good, try pre-selling your product/service. If you can't, maybe the idea isn't as good as you thought and it needs to be scrapped or re-worked.
 

lobster

New Contributor
Oct 23, 2007
48
3
9
i always wanted to know the same. i do have the capital , but want to work with a partner who is fair. its really a very hard question to get a right anwer to. depends on trust and how well we can all get along.
 

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