If you negotiate, you won`t get all of these clauses entirely in your favor, and you shouldn`t. But understanding the implications of the clauses, instead of just embellishing them and signing what`s submitted to you, can literally be the difference between a business sale that makes you a multimillionaire and another job. Finally, check the business plan before signing the small business investor agreement. Investors have the right to see a company`s future goals and the steps they wish to take to achieve those goals. Finally, they invest in these goals and expect success. To make sure the company you`re investing in has a good new start with your financing, check out their business plan. It should contain revenue forecasts and market forecasts. This is called a traditional equity investment. In other cases, the percentage of ownership and dividends may vary. Consider the investment partnerships warren Buffett set up in the `20s and `30s.
Whether you plan to invest in a small business by rebuilding a business from the ground up or displaying yourself in an existing small business, there are usually only two types of positions you can take – equity (exchanging money for profits) or debt (lending money). Although there may be countless variations, all types of investment are at the origin of these two bases. . . .