I have recently brainstormed about how I want to distribute shares of my company in order to raise start-up capital. I have done research on founder's shares and the value of having sound agreements in place with other investors regarding how great a stake you as the entrepreneur will have. It may behoove some of you other start-up entrepreneurs to consider founder's share buyback agreements. You can check out a little info here: Founder Share Vesting
There have been numerous threads here about how to protect your stake and how much you will have in your own company. Depending on your goals, buyback agreements make for a great way to control your main source of personal wealth as well as control of your enterprise. Perhaps you could set it up where once your company reaches certain profit goals, the non-founding investors can sell back their shares for a predetermined price. For example, you have 10 investors who put in $1000 a piece at start-up. You all draft an agreement where they sell their shares back to the company once you double their respective investments to $2000. Two years pass and you've brought in enough profit to generate the promised 100% return on their investments and the company gets the shares back. Now you have an opportunity to buy them while they're cheap...assuming your company continues to take off.
The beauty of entrepreneurship: controlling how much money you do or don't make. :banana:
There have been numerous threads here about how to protect your stake and how much you will have in your own company. Depending on your goals, buyback agreements make for a great way to control your main source of personal wealth as well as control of your enterprise. Perhaps you could set it up where once your company reaches certain profit goals, the non-founding investors can sell back their shares for a predetermined price. For example, you have 10 investors who put in $1000 a piece at start-up. You all draft an agreement where they sell their shares back to the company once you double their respective investments to $2000. Two years pass and you've brought in enough profit to generate the promised 100% return on their investments and the company gets the shares back. Now you have an opportunity to buy them while they're cheap...assuming your company continues to take off.
The beauty of entrepreneurship: controlling how much money you do or don't make. :banana:
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