New Source for Funds!

[bizdev]

Fair questions. But do understand that the website, Preneuraholics.com, will be set up with proper controls. It has been designed so that "projects" (postings for requests) are listed by categories so that donors can choose start ups that they are partial to or have an intrest in helping develop (financially).

Requestors will be able to write up their story. They will be able to upload documents, spreadsheets, photos and the like, so that they can offer as much proof that their requests are legitimate and so they can assure the potential donors that the donations will be put to good use. They can explain with as much as detail as they care to divulge how the funds will be utilized. And participation is limited to people 18 yrs of age or older.

A fee will be charged to place a posting/funding request. Other than that fee, none of the donations will pass through Preneuraholics Unite. If Preneuraholics Unite was set up so that donations came to the company (P.U.) and kept in a holding account and then distributed in full, the business would be in essence, acting as a bank. The legalities involved in that type of business model would be prohibitive.

As such, the most cost effective way to handle the donations is to have the monies directed straight to the requestor. By setting up requirement criteria and certain controls, it is possible to get this business model up and running.

Red tape is what has kept so many would-be business owners from achieving their goals. Trying to keep as many road blocks out of the way and still make this idea workable has been difficult. I am attempting to make business ownership reachable for the average entrepreneur. This may not be to everyone's liking, but at least there will soon be another option available to those that have been turned down and shot down by the system.

Change may be hard for some to accept; for others it's a godsend.

[Sportsfan12]

Bizdev,

I really like your energy and passion you are showing for your project. As far as making donations, I think it is a great idea to allow people to select the category of their choice.

People usually do business with people they like or know. I think the same will apply with donating.

Important: I think you should bring in some charities so a portion of the donations will go to the charities too. I think people will feel even better about making donations.

Let me know your thoughts on this; just trying to help.

--Reginald

[Fanatik]

Wow, I think this is one of the best ideas I've seen. I agree that I would want to know how my donation would be applied/utilized. I would certainly donate to a start-up that I felt deserved my money. Being an entrep myself, I know how hard it is to get funding, and I would be more than willing to donate to a startup.

The amount? Anywhere up to $100 depending on the business. If it's something I don't think will succeed - I certainly will not donate; however, it's the requestor's job to sell me on the idea. I have a sense of "been there, done that, and I know how hard the road is - so let me help someone else that needs it."

Bizdev - I'm interested to see the site when it launches. I definitely think you have a real winner here.

[bizdev]

Important: I think you should bring in some charities so a portion of the donations will go to the charities too. I think people will feel even better about making donations.
--Reginald

Reginald, thank you so much for your support. It will make a big difference if others see fellow entrepreneurs on board and will follow.

And thank you for your suggestion of adding charities to the model. I think however that it is important to keep the entire concept as clear cut as possible and keep the focus on this specific niche. Definitely something to keep on the back burner though.

[bizdev]

Wow, I think this is one of the best ideas I've seen. I would certainly donate to a start-up that I felt deserved my money...and I would be more than willing to donate to a startup.
The amount? Anywhere up to $100 depending on the business.
I definitely think you have a real winner here.

(In the interest of space I've shortened the quote.)

Your show of support is greatly appreciated! This is exactly how I envision the giving portion of this concept. As entrepreneurs that have "been there done that" and gone through the nightmare of trying to locate funding, we can emphathize with others. We appreciate that many people contributing a small amount can add up to make a huge difference.

[inbusinessintx]

I really like the idea that you have of peer to peer donations, with of course proof that those seeking donations are a legitimate business.

I have been through the wringer looking for additional financing for our business. SBA has the Express Loans, but even though the business meets the SBA criteria, you have to meet the individual lending institution's criteria.

I have been looking into private equity, angel investors and venture capital financing but there is so many scams out there, it's hard to figure out what is real. Picture this, "Jerry World" full of garbage and having to sort through it all to come up with one or two items that are of any use.

I know that there are others out there that have been through the same thing, we have even tried to get a personal loan, but have purchased other items with personal credit for the business, that even though the credit score is good, the debit ratio is too high.

I wish you all the luck with your site.

[bizdev]

Ahhhrrrgggg SBA red tape...been there too.
Uncle Sam gives the impression the SBA is there to help us acheive our dreams and goals of business ownership, then they throw so many road blocks in your path it's still impossible for most.

[Southern_Lenders]

I like the concept, I too am starting my own business, however I need at least 400k a year in funding just to breakeven, so this, unfortunatly isn't something I can use .

You are doing something called "social lending"...of course without the lending part. You are going up against some major players, where the investors get a return on their money, where-as with your idea, they wont.

lendingclub, and prosper.com, You get 10, 100 or 1000..or whatever number of people to help fund someones business or personal needs.

Aside from being a kind, giving person, why would someone do this?...especailly in todays economy when people are holding on to their money, why "invest" in a small business when:
1. You arn't getting interest
2. Small businesses have a high failure rate in the first 3 to 5 yrs

EVEN if someone did start a business, that means jack sh-t. It's just a legal name on a piece of paper that I pay taxes on. I started my LLC with legalzoom.com for 560.00 dollars...hell If I can get 50k to help "start" my business, I just made a 49,440 tax free profit off you if I were a crook, and never had any intention of running a business.

Like I said I like the concept, but you have some hurdles infront of you.

- nate

[inbusinessintx]

I like the concept, I too am starting my own business, however I need at least 400k a year in funding just to breakeven, so this, unfortunatly isn't something I can use .

You are doing something called "social lending"...of course without the lending part. You are going up against some major players, where the investors get a return on their money, where-as with your idea, they wont.

lendingclub, and prosper.com, You get 10, 100 or 1000..or whatever number of people to help fund someones business or personal needs.

Aside from being a kind, giving person, why would someone do this?...especailly in todays economy when people are holding on to their money, why "invest" in a small business when:
1. You arn't getting interest
2. Small businesses have a high failure rate in the first 3 to 5 yrs

EVEN if someone did start a business, that means jack sh-t. It's just a legal name on a piece of paper that I pay taxes on. I started my LLC with legalzoom.com for 560.00 dollars...hell If I can get 50k to help "start" my business, I just made a 49,440 tax free profit off you if I were a crook, and never had any intention of running a business.

Like I said I like the concept, but you have some hurdles infront of you.

- nate

Nate,

What about they show proof of doing business, examples would be records of taxes paid to the state or federal tax, of course the the web site as proof that the business is legitimate. There are ways of making sure that the business is indeed a business, though it would be on the shoulders of the web site owner.

In the case of start ups, I cant think of a way of verifying if the business is legitimate or not, but I can see how this would work for existing businesses.

Good luck finding your money, we are only looking for a quarter of what you are looking for.

[bizdev]

Nate (Southern Lenders), you have valid concerns. As I've stated regarding the return on your investment, when we're talking about such small donations it's not about getting a financial return. It's about giving a deserving fellow entrepreneur a break. It's about having been in their shoes and knowing what they're going through and wishing someone had given me (the potential donor) a similar break.

This is why I say it's in the power of numbers and the power of unity. At first glance $10 or $25 sounds like a drop in the bucket. But when you have hundreds or thousands (eventually) giving just a little, it will snowball.

Of coure there's always the possibility of a fraudulent posting. But there are safe gaurds built into the model to control it.

Do we not do this at all and miss out on creating positive change out of fear? Do we not give because there's a chance the new business might not survive? That risk is there no matter how it was funded.

[bizdev]

In the case of start ups, I cant think of a way of verifying if the business is legitimate or not, but I can see how this would work for existing businesses.

Requestors for start up funds will be able to upload documents such as parts of their business plan (without divulging confidential information). They can make available for viewing their start up costs detail and their assumptions and projected income statements. If they have applied for their DBA or business registration they can supply that info. Obviously those that do their homework and put serious effort into their posting will draw the most donations.

[Southern_Lenders]

Ok, but you still have the problem of :

1. A lot of businesses needing funding and very little people able or willing to give. Seems this scale is always going to be weighed down on one side. More demand than supply.

2. You have a lot of money going to a select few businsses from donors, and leaving the rest of fund seekers empty handed with little or nothing.

3. A person looking for funding, is not going to also donate funds..that would be counter productive.

[bizdev]

Ok, but you still have the problem of :

1. A lot of businesses needing funding and very little people able or willing to give. Seems this scale is always going to be weighed down on one side. More demand than supply.

2. You have a lot of money going to a select few businsses from donors, and leaving the rest of fund seekers empty handed with little or nothing.

3. A person looking for funding, is not going to also donate funds..that would be counter productive.

1. That is your own assumption. That is how you lean so that is how you assume everyone else will lean.

2. If the seekers don't post they will never know if their startup wouldn't be one of the favorites. You need to play to win as they say.

3. The counter productive aspect has been discussed here already. Of course a requestor will feel compelled to also give. Just because a requestor doesn't have $40,000 for their start up doesn't mean they don't have $25 to pay it forward. Additionally, I can see a requestor that has been funded through this program to feel grateful enough to then continue to give regularly to others knowing what a difference someone else's donation made for them.

[Chef_Frank]

you say you believe in Entraprenuers helping Entraprenuers. Well I am one who needs this help. I also support this and I can guarentee you will make a nice tidy profit from this business. Visit my web page at Natures Cuisine, Ltd "Cuisine for Your Blood Type" and it will proove my point. I need the money-$500,000 to start and will continue to applyu for more as the need arises.

thanks for your help
Chef_Frank

[ebforex]

I cant wait to see how this will turn out! Re Inventing The Wheel...