Good returns, solid plan, lenders initial thumbs up, need some additional capital

**tcuneo** · 10-06-2011 08:05 AM

My wife and I are in the process of buying an operating and profitable resort in the the middle Keys area of the Florida Keys. We have spent the last 6 months researching and writing a serious business plan and are working with an SBA lenders via the CDC 504 program. We have secured the initial downpayment and the initial unofficial thumbs up on our metrics for the resort. Our lender is very optimistic and has been proactive in assisting us with getting this project done.

The property has a Deli and Dive Permit not being used. We would like to take advantage of these but lack the capital to get those aspects going. It also enjoys multiple revenue streams including a year round marina and convienence store to offset low season revenues.

We are looking for investment to sell a max of 20% in 5% chunks to finance these projects. 5% would be 130k investment. We ARE purchasing the property for 2.3-2.4mil, in 2006 it appraised for 4.5mil. We fully expect over the next 5-10 years for values to return to the 4.5mil level. My wife and I will be living onsite operating this as a hands on operation. We have looked at 10 other resorts and the financials of those resorts and determined based on solid research, economic studies, tourism studies and past performance that this property is a winner.

We are looking for investors interested. We are offering the following for 130k investment. We have made this package attractive due to how tough investors in this segment are to find lately. But are confident that the long term aspects of our plan and this property will justify. Our DSC is within SBA required metrics as well.
* Note payback on a 5 year amort
* 5% equity ownership
* 3 weeks facilities usage per year
* Buyout option in 10 years at fair market value if desired

The funds will be used as follows:
* The first 5%: 75k will be used as a reserve fund only the remainder will be used for closing cost expenses
* The second 5% will be used to start up a small dive operation and market it heavily to US and international dive shops via group trips to fill the hotel in chunks
* The 3rd and 4th will be used to expand dockage to add additional revenue through long term dock leases. Any remainder will remain as reserve funding and general operating to keep our accounts liquid.

We are not interested in brokers, we are not interested in up front fees. We know we have a solid plan that will get approved by the SBA. We are looking for anyone who is interested in what we are offering.

Please email tom @ tlcinternet.com for the link to the business plan, financials and stock purchase option - all are online in PDF format for review.

Thanks for looking
Tom and Kara Cuneo

**tcuneo** · 10-07-2011 09:10 AM

Ok - so I have to ask - 62 views and no comments -

What AM I missing to make this attractive enough to draw the investment needed. Not being sarcastic but am legitimately asking since this is a site of Entrepreneurs.

Thanks in advance -
Tom

**Parvaze** · 10-07-2011 03:06 PM

Two things: You are a start up and there is only a max of 20% equity available. I doubt any serious investor will want to get involved as the stakes are too low. Your best bet is go to people you know personally, family/friends etc. Good luck

Best

**tcuneo** · 10-07-2011 03:15 PM

I understand, but we are talking about a 2.4mil property, so based on that valuation the equity position is justified, isnt it - or am I missing the boat?

Im not against a larger equity share but i think the investment should be proportionate to the valuation - should it not? :-) Even at 20% for 520k the investor is coming out ahead against the overall valuation of the business.

The business is existing, operational and profitable currently. Only our own LLC is new for this project and I personally have 16 years of experience, my wife 10 in management and the business has been operating contuously for over 30 years.

Thanks again - as stated - I am interested in learning what we are missing to attract the investment needed.

Tom

**tcuneo** · 10-10-2011 08:40 AM

Should I consider a higher equity or lower investment $$ per 5%?

It amazes me that through reading the internet all the worthless ideas and scams, but when we have a legit business plan, solid profits and long term potential from a 30 year old proven profitable business we can't find what we need. :-)

We have spent the last 6 months on researching and on documentation supporting everything, got the SBA initial thumbs up and secured up to 300k for the CDC required downpayment and still having a hard time finding that last investment needed...

Teach me o' wise Young Entrepreneurs ;-)

Tom

**tcuneo** · 10-11-2011 09:39 AM

Anyone hehe :-)

**Parvaze** · 10-11-2011 10:42 AM

I think you missed my point; as an entrepreneur I want to see gains in the double or triple digits as well as increased value in the underlying assets. In your case I would be putting up ~$500K getting 20% equity ion a building that may grow at a few percentages points annually at best and throw off maybe a $100K a year in dividends/profits.

With that same $500K I can conservatively double it in a year by buying/selling goods on the one hand or do something in hi tech/software/mobile apps or whatever where the potential returns are far superior.

Good luck with your project, but as I said earlier you are probably in the wrong place looking for money here. You are far better off trying to raise the funds through people you know personally i.e. family/friends

**tcuneo** · 10-11-2011 10:53 AM

Thanks, I think you are correct, we are not looking for get rich quick investors but someone who sees long term value -

Thanks for the reply and for breaking it down for us.

**Parvaze** · 10-11-2011 11:01 AM

For what it's worth, I've built companies that generated multi-million dollars in annual revenue. They were all built on the premise of building long term value & sustainability; hardly what you would call "get rich quick" schemes

I agree that you are not looking for "get rich quick" types, but people like me are pragmatic business types who see far better value in doing something else with $500K rather than putting into a project such as the one you describe.

Good luck