when you talk about investor there´s a majority
of options to look for. The first thing it is know yourself and what are your
main goals with Creativity Density. I think you already know most part of these
information, although know you need to know if these investor have the same
goal as you, if they have the same values, if they complement you with
something (like: empower you network, gain scale to implement new projects, or
I think the model Alex
said before it is very closed to the endowment funds ( Financial endowment
Wikipedia), endeavor it is a organization that has something cool about
companies that they helped and after the program these companies (they don’t
call startups other than scale ups´) give some equity to them and these is the
fuel to continue to help new scale ups.(http://endeavor.org/)
Hedge funds and others
financial investors will invest in the space if they saw something unique and
they will help you to create a scalable model, using their money, network,
structure and etc. It is basic these. They will buy equity from you very cheap,
invest in the company to transform in a big thing, with stability and continuous
recurrence of money inflows and then sell these partition very high and you
have the rights to follow on, and also make money.
Looking more close to
your case, I enter in the website to understand about it. So i will give you
some advices imagine myself at your seat.
You showed yourself
opened to Investors looking to new branches
and replication of creative density model.
Ok. Who are these
people ? Do they have the necessary skills to be a space operator? Why they
don´t open a new space, and want CD brand? I might be for several reasons, but
it is important to know. It could be a strength they think you have ro other,
but in the end you will have to fulfill or exceed their expectations.
Is your business ready
to be escalated? Core process of the business are tested, secured, atomized?
What you going to offer
? Management software? Training? Branding?
What this will enable
you to do that you can´t do today? Size for hold your own events (talks,
training, networking, etc.)
Are going to charge for
royalties or maintenance? How much?
How much they will need
to invest to build a new brunch? What are the strategic locations? the boundaries
(10 miles range)? the guidelines for architecture, furniture quality, network,
internet, decoration, number of people, kinds of spaces, communication boards?
Do you have partners for it? How much working capital someone needs in these
king of business?
What are the things you
don’t want to lose?(very important)
Now you going to need a
law partner and a mentor with franchise
or M&A experience to help you in these moment. Finally i don’t like the
idea of buying the build you rent today, these is a asset that you already generate money, if you buy it you
are going to generated the same money with more investment. And even if the
build it is yours, you need to depreciated (reinvest the depreciation) and also
put in the P&L, inside costs the value of a market rent for that same
building, and the business has to generate money to pay it. otherwise it is a
not a good business.
It is a very complex
subject and i am more than glad to help you more, if you wanted. i recommend
some short videos that also might help you.
PS: Sorry for the bad English.
Co-founder @ LAB 48
Em terça-feira, 20 de agosto de 2013 13h22min58s UTC-3, Craig Baute - Creative Density Coworking escreveu:
I have been approached by three different investors in the last few weeks for new locations. Creative Density is looking at a second location and building up the new community for it in a simlar way to how we did it two years ago. It’s very grass roots and will only happen if the community can be formed before the space opens. Once this process started to happen that’s when investors started to show up.
I know several others have had similar experience so I am hoping I can have guidance about important questions to ask and possible structures.
What I’m thinking:
Creative Density’s current location remains my own domain. They don’t get a chunk of that but they are investing in future locations with the new location being a new business entity. We will share access to my intellectual property but in case of a split I will retain control in a reasonable time frame of transition.
How much money:
They are looking to purchase the building and renovating it. I’m working on how much money they need to put in beyound that and how to split revenue and profits.
Do they have a good personality match and complimentary skill set?
I’m laying out my principals of what I want coworking to be and that profit is not the sole driving force. Yes, we want to make money but we also want this a platform and community that supports freelancers and remote workers as well as small teams. Private offices sell fast but they can not dominate the space and must be around only a third of the space. They do have a good skill set that compliments my own as an experience coworking space owner.
Any advice would helpful.