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Investing in a startup company

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1 Investing in a startup company on Mon Jun 01, 2015 10:06 am

haroldleighton


Arresto Menor
Hello!

I am in talks with a startup company seeking investment fund in exchange for equity. The amount involved is 500K pesos in exchange for 4% share ownership. The company's valuation is 15M pesos. I am Filipino based overseas, but the business I am investing in is based in the Philippines. They are targeting a soft launch Q4 of 2015 and are seeking investment funds by July 2015 so as to get started with registration with SEC as a corporation.

As an investor, what legal documents should I take note of? What documents should I request (or should the company provide me) when I write them the check for the investment amount that I committed? What rights as a minority share holder should I have?

Thanks for your responses.

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2 Re: Investing in a startup company on Mon Jun 01, 2015 12:22 pm

LandOwner12


Reclusion Perpetua
sorry brad,
di ko pa forte ang mga corporate deals,
ang mapapayo ko sayo eh,
ingat ka lang sa mga scams,, marami nyan,,
sana lang kilala mo majority ng stockholders,
wag yong 1 or 2 lang, kasi baka pati cla eh kasamang biktima...

isa pa, twice na ko nagventure sa business,
if walang hands on supervision, at iasa lang sa iba, its more bound for failure..
isip isip..

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3 Re: Investing in a startup company on Mon Jun 01, 2015 5:37 pm

Lunkan


Reclusion Perpetua
"investment fund in exchange for equity. "
?? I don't know if there are any other meaning of "equity" than "The COMPANY'S own capital.
Do you mean similar to stock market shares? (They can be such shares if the company isn't at the stock market too.)

How much PROFIT do they "predict"?
If it's VERY much, then it's probably a scam...
BUT there are some REAL business opportunities too with a good chance to get good - but not fantastic Smile - profit.
(I know SMALL projects, which often double the investment in a year, BUT if make same types BIG and long time then almost no projects can make such profits.)

"The amount involved is 500K pesos in exchange for 4% share ownership. The company's valuation is 15M pesos."
??? HOW can they claim a NEW started company to be worth 15M, when there will be only 12.5M at 500K for 4 %??? Smile
That don't make it sure it's a scam, but that's a scam SIGN...
(Perhaps - but probably not Smile - the starters have added EXTRA value. Or they are just bad economists Very Happy which is a bad sign even if they aren't scammers.)

"are seeking investment funds by July 2015 so as TO get started with registration with SEC as a corporation."
Do they say they will registrate at SEC AFTER they have seeked investors allready, who they DON'T know ?
That's ILLEGAL. SEC has to APPROVE the company BEFORE it seek investments from the PUBLIC...

It's very SAD Crying or Very sad there are so many scammers in the Philippines Evil or Very Mad because the country realy NEED investors to add jobs...

Perhaps you better wait until I have settled in the Philippines and seek investors Laughing
(Just joking. It's true I PERHAPS will start a business type, which better be big to do it the best way so it would need investors, but I haven't decided yet, if I will do such type or if it will be a smaller other type of business, which just need my own money.)

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