Seeking Investor - est. 100k Profit this year - Explosive growth

[esoteric]

Hi all-

I've done some browsing around this forum, but it doesn't seem as though there are actually many investors around. In any case, I will share my business with you all anyway.

I've recently created a start-up based around a product which I designed, and have had manufactured. Without going into too much detail, this product is part of an exciting niche, which has yet to establish a solid industry leader.

For the past few months, I have been bootstrapping. I've created two websites which sell the product, and have been selling on amazon and ebay just to get a feel for the interest in my product. To my enjoyment, the product has been selling itself. I've done virtually no marketing to this point.

My design is an improvement of an existing product. The fact that my design is superior has already drawn consumers towards my product. Based upon the sales of the original (poorly constructed) product, I can estimate that I will bring in approx. $250,000 in revenue this year, with profits around the $100k mark.

Up until this point, I have funded the business on my own credit. Now, I am seeking an investment in order to put the business to where it needs to be come this summer (greater interest in my product during summer months). More capital is necessary in order to market the product properly, create a website with a better online presence, and fulfill the potential growth which is outlined by the business plan.

I'm offering a negotiable percentage of equity share in my company in return for your investment.

If you'd like to talk about this in further detail under nondisclosure, please contact me either via PM or my personal email, esoteric10 at gmail dot com.

Thanks for reading.

[ZingerIntl]

You sound like you know what you are talking about but I dont understand why didnt get a link to a website that is selling the product already. Can we have a link I think that might get more interest.

How much funding do you need?

[esoteric]

zinger-

Since this is a young entrepreneur forum, and this product is very exciting to this demographic, I'd rather not disclose particular details about the product publicly- as it may influence readers to create a competing product. If you'd like, we can talk in further detail privately.

I've come here in considering that typical angel investors 1) usually deal with larger investments, and 2) most investors are typically older in age, therefore not fully understanding the mass appeal of my product.

I'm looking for an investment in the $50k range, for a negotiable percentage of equity share.

[EBITDA]

Be careful that you don't violate securities laws since what you are proposing is issuing unregistered securities.

Nick
TransCapital Pro

[esoteric]

Be careful that you don't violate securities laws since what you are proposing is issuing unregistered securities.

Nick
TransCapital Pro

I may have not been clear with my last post. I am looking for a partner to take on, say, a 10-20% ownership in my company, in exchange for an appropriate investment. I've heard of such things happening with private startups. I've never heard of having to being public in order to seek an investment legally.. Am I missing something? How do angel investors invest in startups that are not public w/ SEC oversight?

[EBITDA]

Under the Securities Act of 1933, any offer to sell securities must either be registered with the SEC or meet an exemption. Regulation D (or Reg D) contains three rules providing exemptions from the registration requirements. Reg D are for the benefit of small companies seeking to raise capital from accredited investors.

There are also state laws to consider. Since you are seeking an investor you are by default issuing securities.

A Private Placement Memorandum, or PPM, is a way to communicate what your company is about and a summary of terms for the security you are offering. By using a PPM you are providing prospective investors/partners with a consistent communication of your offering, thus providing yourself with cover from potential securities fraud claims.

The other benefits from having a PPM is 1) you intentionally think through what you are looking for; and 2) you present a professional face to your fund raising efforts.

An attorney may charge you $15,000 to $20,000 or more (I spent $18,000 on my last PPM), but, and this is self serving, you can get a template and write you own for $397 from TransCapital Pro. Ping me if you have any other questions.

All the best,
Nick
www.TransCapitalPro.com

[esoteric]

Under the Securities Act of 1933, any offer to sell securities must either be registered with the SEC or meet an exemption. (or Reg D) contains three rules providing exemptions from the registration requirements. Reg D are for the benefit of small companies seeking to raise capital from.

There are also state laws to consider. Since you are seeking an investor you are by default issuing securities.

A Private Placement Memorandum, or PPM, is a way to communicate what your company is about and a summary of terms for the security you are offering. By using a PPM you are providing prospective investors/partners with a consistent communication of your offering, thus providing yourself with cover from potential securities fraud claims.

The other benefits from having a PPM is 1) you intentionally think through what you are looking for; and 2) you present a professional face to your fund raising efforts.

An attorney may charge you $15,000 to $20,000 or more (I spent $18,000 on my last PPM), but, and this is self serving, you can get a template and write you own for $397 from. Ping me if you have any other questions.

All the best,
Nick

Thanks. Very informative. So from what I understand, non-accredited investors are out of the question until I am able to register a PPM, correct?

[EBITDA]

It depends. Read Rule 505 and Rule 506. You can have non-accredited investors under both Rules 505 and 506, but under 506, they must be sophisticated; i.e. must have an understanding of the investment.

As far as the PPM, you don't "register" the PPM. Think of the PPM as your marketing document of sorts. A document that meets the requirements for marketing securities that describes the security you are issuing and describes the business.

If you are currently only distributing a term sheet, or worse, just verbally pitching your deal, then you are exposing yourself to potential problems.