4 life hacks for investing in a startup: cheers, there is a quick and easy legal model
Hello!
I have been dealing with investment issues for 8 years, and of which the last 2 years - the possibilities of quick, simple and massive investment in startups. Simply put, my task is to get a platform where you can click on the “pay 1000 rubles” button, and this 1000 rubles will immediately become a full-fledged investment with all the necessary legal binding.
Earlier, I wrote that the only way proven so far is the opening of an open joint-stock company or a closed joint-stock company. This requires a lot of time, resources and prevents small projects from starting. Now the method was found much, much simpler. I’ll talk about him below.
This is an analogue of the revenue share design from English law.
The bottom line is the possibility of concluding an investment contract with a share in the profit, and not in the company as such . Moreover, payments to investors are made not from dividends, but from profit, that is, without any unnecessary difficulties and with a much higher level of protection. Perhaps this is a feature of the economy of our country - you do not need to trust the owner of the company, but directly tie its profit to payments.
Now let's see how a large investor works:
On this graph, the following: roughly speaking, five people gathered in a garage, developed a new piece of iron. Six months later, success came, and the investor became interested in the project. He paid everyone a good reward and bought out the company.
The beauty is that now these two charts can be combined - and also so that a couple of people from the start-up team will be in equal shares with a large investor.
1. A start-up comes and shows a business plan, plus all the rationales.
After a brief check by experts and the banking security service, we proceed to the next stage.
2. Startup registers LLC
Extremely desirable - with simplified taxation. An IP is not suitable for us, and a closed joint-stock company or an open joint-stock company is already too complicated for the level of simple launch and accumulation of funds at startups with the amount of up to a million dollars. There is a service for registering an LLC by an external contractor, that is, for example, if you came up with a piece of metal, the paperwork will end at the first stage after the security service.
3. An investment contract is drawn up
It will be accepted by all participants of crowdinvesting. Lifehack No. 1: given that this agreement is aimed at a share in profit, the main restriction on 50 LLC participants is not imposed on investors. This agreement is later laid out as a public offer, which completely removes all the difficulties of signing.
The main points of the agreement are what exactly is included in the project, how funds will be distributed, what reporting will be, what investors will get access to in terms of information (for example, statistics systems), what will be the amount of payments to investors. The contract is "set up" by the startup owner, we only give recommendations. Then all this is checked by the lawyers of the site.
This is a key point, because before the restrictions, LLCs were very pressured: there is an extremely “holey” system of share separation, which is designed for trust between participants. From examples of complex interactions, it is almost impossible to exclude one from the list of participants by all at once, until he voluntarily agrees.
4. The start-up signs an agency agreement with our site.
This agreement implies placement in the crowdinvesting ecosystem and working with large investors known to us. If the amount is collected at the end of the placement, it comes to the bank account of the startup owner. The principle as on Kickstarter for a couple of differences:
5. Development
The project develops a year or two and returns either full investment plus profit, or investment and part of the profit.
6. Large investor
At this moment, when the project is already large and successful, a second-level investor is sought. As an example, Google or Yandex companies buying back startups. This is an optional step, but characteristic for the development of the company.
At the same time, each investor of the first round receives a proposal to pay off investment contracts - that is, everything that the startup owes you on profit is immediately paid, and the contract closes. Here a natural desire arises to leave key investors of the first level: for example, it can be a big friend of the project, a developer who invested himself and joined the team and so on. In this case, life hack number 3 is in effect: targeted options are sold: you can buy the interest already in the company (and not just in profit). Options (including options of large investors) are distributed in quantities of up to 50 until an OJSC or a CJSC appears.
The result for a startup is that you can start almost immediately without any hemorrhoids. The result for the investor is that you can click on the button on the site and pay, say, from 1000 rubles, then to get profit from this, access to complete information about the project and the opportunity to influence its development.
Now back to the chart:
The whole charm is that you can invest in a project, and then receive deductions from its profit, and only then, if necessary, sell everything to a large investor (Google level, if it was a technogenic start-up, for example). And best of all, you, as a micro-investor, are protected much more than in the first case, because if you have profit, you can not pay dividends (this will be decided by large investors), but you will have to pay deductions for the investment contract. This is life hack No. 4, which guarantees, in combination with the clause on the mandatory repayment of the contract by the second-round investor, that if the project succeeds, you will receive money exactly.
Summary: we now have the opportunity to launch extremely fast and simple mechanics of fundraising for various projects from opening a cafe to developing iron. Given the network specifics, in the first place we will focus on IT projects. A few weeks later we are launching the “first swallows”.
I have been dealing with investment issues for 8 years, and of which the last 2 years - the possibilities of quick, simple and massive investment in startups. Simply put, my task is to get a platform where you can click on the “pay 1000 rubles” button, and this 1000 rubles will immediately become a full-fledged investment with all the necessary legal binding.
Earlier, I wrote that the only way proven so far is the opening of an open joint-stock company or a closed joint-stock company. This requires a lot of time, resources and prevents small projects from starting. Now the method was found much, much simpler. I’ll talk about him below.
This is an analogue of the revenue share design from English law.
The bottom line is the possibility of concluding an investment contract with a share in the profit, and not in the company as such . Moreover, payments to investors are made not from dividends, but from profit, that is, without any unnecessary difficulties and with a much higher level of protection. Perhaps this is a feature of the economy of our country - you do not need to trust the owner of the company, but directly tie its profit to payments.
Now let's see how a large investor works:
On this graph, the following: roughly speaking, five people gathered in a garage, developed a new piece of iron. Six months later, success came, and the investor became interested in the project. He paid everyone a good reward and bought out the company.
The beauty is that now these two charts can be combined - and also so that a couple of people from the start-up team will be in equal shares with a large investor.
It works like this
1. A start-up comes and shows a business plan, plus all the rationales.
After a brief check by experts and the banking security service, we proceed to the next stage.
2. Startup registers LLC
Extremely desirable - with simplified taxation. An IP is not suitable for us, and a closed joint-stock company or an open joint-stock company is already too complicated for the level of simple launch and accumulation of funds at startups with the amount of up to a million dollars. There is a service for registering an LLC by an external contractor, that is, for example, if you came up with a piece of metal, the paperwork will end at the first stage after the security service.
3. An investment contract is drawn up
It will be accepted by all participants of crowdinvesting. Lifehack No. 1: given that this agreement is aimed at a share in profit, the main restriction on 50 LLC participants is not imposed on investors. This agreement is later laid out as a public offer, which completely removes all the difficulties of signing.
The main points of the agreement are what exactly is included in the project, how funds will be distributed, what reporting will be, what investors will get access to in terms of information (for example, statistics systems), what will be the amount of payments to investors. The contract is "set up" by the startup owner, we only give recommendations. Then all this is checked by the lawyers of the site.
This is a key point, because before the restrictions, LLCs were very pressured: there is an extremely “holey” system of share separation, which is designed for trust between participants. From examples of complex interactions, it is almost impossible to exclude one from the list of participants by all at once, until he voluntarily agrees.
4. The start-up signs an agency agreement with our site.
This agreement implies placement in the crowdinvesting ecosystem and working with large investors known to us. If the amount is collected at the end of the placement, it comes to the bank account of the startup owner. The principle as on Kickstarter for a couple of differences:
- This is an investment, not a purchase of something, that is, everyone makes a profit from the success of the project.
- Life hack number 2: the startup owner also receives increased attention from serious investors, and for this he does not need to go around each one.
5. Development
The project develops a year or two and returns either full investment plus profit, or investment and part of the profit.
6. Large investor
At this moment, when the project is already large and successful, a second-level investor is sought. As an example, Google or Yandex companies buying back startups. This is an optional step, but characteristic for the development of the company.
At the same time, each investor of the first round receives a proposal to pay off investment contracts - that is, everything that the startup owes you on profit is immediately paid, and the contract closes. Here a natural desire arises to leave key investors of the first level: for example, it can be a big friend of the project, a developer who invested himself and joined the team and so on. In this case, life hack number 3 is in effect: targeted options are sold: you can buy the interest already in the company (and not just in profit). Options (including options of large investors) are distributed in quantities of up to 50 until an OJSC or a CJSC appears.
The result for a startup is that you can start almost immediately without any hemorrhoids. The result for the investor is that you can click on the button on the site and pay, say, from 1000 rubles, then to get profit from this, access to complete information about the project and the opportunity to influence its development.
Now back to the chart:
Show
The whole charm is that you can invest in a project, and then receive deductions from its profit, and only then, if necessary, sell everything to a large investor (Google level, if it was a technogenic start-up, for example). And best of all, you, as a micro-investor, are protected much more than in the first case, because if you have profit, you can not pay dividends (this will be decided by large investors), but you will have to pay deductions for the investment contract. This is life hack No. 4, which guarantees, in combination with the clause on the mandatory repayment of the contract by the second-round investor, that if the project succeeds, you will receive money exactly.
Summary: we now have the opportunity to launch extremely fast and simple mechanics of fundraising for various projects from opening a cafe to developing iron. Given the network specifics, in the first place we will focus on IT projects. A few weeks later we are launching the “first swallows”.