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Old 12-31-2013, 12:53 PM
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MikeTA95 MikeTA95 is offline
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Get an Investor or Downsize?

So, I'm at a crossroads and I am going to ask you guys what you think. What would you do if you were in my shoes, unable to continue on due to money issues and a list of equipment that barely made it this season.

1. I have an investor interested in helping me buy some more equipment, which I thought was a god send at first except he wants 60% ownership of my company. He wants me to add another crew, and he would want me to bring my gross up by at least 100k next year. The positives are I get to grow my company more, get to add some projects, more guys, more pride, etc. The negatives are having to share my company with this guy who wants me to turn some pretty big numbers which is going to be stressful to say the least. Also, I won't be making much more money for myself.

2. My other option is sell off the extra trucks and go backwards. Go back to one crew, me and two other guys, and do a the closest/most profitable properties and drop the rest. I figure I can sell off my equipment and get enough together to replace it with decent equipment for one crew. Positives are the lack of debt and I'll get back in shape, better quality of work since I'll be on the job, maybe even have the time to finish college. The negatives are the perception of failure, I'll be taking a pay cut, The stresses of dealing with a much lower cash flow, having to let go of a lot of customers.

What would you do?
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Old 12-31-2013, 01:00 PM
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First off, you will now be an employee, your not the boss now, sounds like you Need to figure out your finances and reorganize.
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Old 12-31-2013, 01:02 PM
TuffTurfLawnCare TuffTurfLawnCare is offline
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I would go to with option 2. With option 1 you are now growing HIS company. Its no longer yours once you sell a controlling stake. Option 1 you have become an employee.
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Old 12-31-2013, 01:06 PM
caseysmowing caseysmowing is online now
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Quote:
Originally Posted by JB1 View Post
First off, you will now be an employee, your not the boss now, sounds like you Need to figure out your finances and reorganize.
X2 on that. If you are barely making it now then addin a investor that is going to want to see some profits also doesn't sound like it would work. I'd downsize and regroup and stay focus on your numbers.
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Old 12-31-2013, 01:06 PM
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easy-lift guy easy-lift guy is online now
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The phrase "except he wants 60%" means you have no ownership of your company, you will be working for the new owner with no prospect of ever retaining any controlling interest in what was once your business. If you don't mind working for someone else and having them calling all the shots in the present and the future your decision is easy otherwise work with what you have and politely tell the investor, no thanks.
easy-lift guy
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Old 12-31-2013, 01:09 PM
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RedSox4Life RedSox4Life is offline
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I agre with these guys. With option 1 it sounds like equal or more work, with all the headaches, but with less pay and no ownership.

Id be putting in resumes elsewhere before considering that option.
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Old 12-31-2013, 01:15 PM
jc1 jc1 is online now
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Of your 2 choices there is only one option, down size.
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  #8  
Old 12-31-2013, 01:21 PM
ztman ztman is offline
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Option 3, sell him the whole company, become an employee, and finish college
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Old 12-31-2013, 02:29 PM
WenzelOSLLC WenzelOSLLC is offline
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I like option 3. Is there enough cash flow and client retention year to year to go to the bank and get a line of credit to start swapping out equipment?
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  #10  
Old 12-31-2013, 03:05 PM
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Glenn Lawn Care Glenn Lawn Care is offline
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I would choose option #2! Don't lose control of your own company. Down size for a year if you have to, get back to the basics. Save money and see where you are at this time next year.
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