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Re: Business Purchase Posted by Justin VanAbrahams [Email]  (#32) [Profile/Gallery]
(more from Justin VanAbrahams) on Sat, 21 Oct 2006 23:52:24
In Reply to: Business Purchase, NickR, Sat, 21 Oct 2006 17:30:15 Members do not see ads below this line. - Help Keep This Site Online - Signup |
I have been through this particular scenario only once (and am actually going through it now, as well...), and have helped raise money for three other ventures (ranging from $250k to $37m - and no, I don't have anything to show for it :).
Buying a business that pays it bills and doesn't have significant growth porential, you're unlikely to find someone to invest but may have luck finding a partner. Most investors are going to be looking for a multiple-times return on their investment in a few years (those numbers vary on the type of business, and the industry). If you can't give back double in a few years, someone with $300k kicking around can probably find a better deal elsewhere. On the other hand, if you've got a running business that's stable, pays its bills, and provides a reliable income for its employees and owners, you may very well find someone just like yourself who's looking for something to do for the next several years...
If you are in that situation where you've got an $800k business that will be worth millions in a few years, then you're in the market for an investor. Finding that person or those people really depends on what the business is, what it's potential is, and exactly what it is you're giving up to them. Investors come in every flavor, and are available for every stage in your business. Some specialize in certain types of investments (bridge funding, first round, etc.) and some in certain types of industries (technology, biotech, etc.). All of them are going to want to understand what the business is, what it does, how stable it is, what it's potential looks like, and when they get paid. Some combination of those factors will determine how much (if any) they'll put in, and what they expect in return.
That said, are you looking for a partner, or an investor?
posted by 216.57.64...
, Sun, 22 Oct 2006 02:12:36, Sat, 21 Oct 2006 23:52:24 <-- Viewing This Message
, Mon, 23 Oct 2006 08:50:46, Tue, 24 Oct 2006 12:38:09
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