Has anyone every been involved in issuing shares in a small company?

[Katymac]

I am considering "selling" shares in the nursery as the latest suggestion for funding has fallen through.

Is there an easy way to do this or is it purely a stock market thing?

Ideally I'd like to sell 10 shares of £5K each which would each be approx 2.5% share of the business - so I would still own 75% of the nursery

Do you think it's possible or is it a "silly idea"

It can be done
We have bought into a mate's new business
We don't have any say in how it's run though

It is formal
We have shares etc
It depends on the set up or your no of shares as to whether you have any say in the running of the compnay

Thanks Littlelapin - there are no investors in my area (apparently)

I don't know that many rich people

I would need to ask about 100 people I guess to get 10 or maybe even more

Have you spoken to business link?

buslink shares info

You'd need to get a proposal together etc to show people

Wow - there are 4 potential people

What sort of return do they want?

I better read the website and see if I can work it out......

Not sure that it is entirely practical. Obviously the purchasers have an issue about being able to eventually sell their shares (and the main "investment" of the company will be a wasting asset of a lease, so the value will drop over time?). Now that it not a problem if you give them a high enough dividend payment. And you can have more than one class of shares - essentially you could issue prefeence shares which would give a fixed return each year and would be almost similar to a loan.

The quesion is whether you would find that number of people who would effectively loan you the money. Especially if your bank isn't willing to.

I lived with Business Link over the last 18m

I have cashflow forecasts/architects plans/business plans & loads of stuff

But the problem is that I am leasing the barn not buying it & that means banks won't lend me the money

3 ordinary banks plus to commercial bank advisors have said the plans should work and the business be a success - but they won't lend on a lease

I could pay the investors 10% a year and then their money back after 5 years (I think) & once the busienss had been trading for 5 yrs I could get a loan to pay back the investors (IYSWIM)

I will phone tomorrow but it's so frustrating when people say they can help & then they pull out (3 weeks later)

That is of course the problem

Never mind that I am anally honest and go back in to shops when they give me too much change......that doesn't count neither does the fact that my dad went bust in the 70's & he sold his house to pay back his debts

No assets - well a 25yr lease on a very nice improved barn (rent out as holiday flats?)

You seem a small business expert littlelapin!!

Could you look at my private company thread??

Sorry for hijack katy

Sorry Katy - your note of 18:22 - how would that work? Why would the bank be any more happy to lend to you in 5 years time?

But main asset is a wasting lease?

But if we are making money, I can borrow money - esp if I have been making for more than 2 yrs

If C/Ming was a more profitable sector they would lend me on that - but I've only made 8K a year for the last 4 yrs - so they won't lend on that as it pays my mortgage - so I've "used" it already

The C/Ming will support us - plus for the 1st 3 yrs I pay no rent, plus the loan I do have has a 3 yrs capitol repayment holiday

The Nursery only has to support itself & Pay it's debts off (IYSWIM)

Plus if the nursery does make money, I can get our house mortgage in my name instead of DH & mine and take it over 25 yrs instead of the 9 we have left

Something has come up

What do you think??