From: Adam <""4thwormcastfromthemolehill\"{at}the field.near
the bridge">

Antti Kurenniemi wrote:
> Today I just got offered a considerable (well for me anyway) sum of money,
> to fund my software business. Wowzat, that's cool! I've been battling to
> finance my development (I'm doing a small-business crm/time
> planning/invoicing/whatnot type of application) by doing support gigs and
> all sorts of odd jobs, and this would really make all the difference in the
> world. I'm so excited that I can hardly stand (or sit) still.
>
> Anyone have any hints / ideas how to value a software (business) before it
> sells anything? I'm left with a decision: I have to offer a percentage of my
> company to the investor, and I haven't got a faintest clue as to how big a
> slice I should offer - too big and I'll regret it for the rest of my life,
> too small and they'll just shoot off leaving me empty handed... Damn, why
> aren't cool things ever easy . Well, no worries, I'm pretty sure I can
> trick them into telling me what they have in mind, and then I'll just divide
> that by two, and that should be about right.
>
> Wopee! Beers are on me the next time you're hereabout!
>
>
> Antti Kurenniemi
>
>
Never let go of 51%.

In a private company if one person has 51% the rest have no power & are
there for the ride.

Remember that one of the main rules of an investor (usually though I know
not yours) is "first fire the founder".

Odd but true. Depends on the size of the comp obviously (i.e. one man
band....founder = company....) but if the comp gets to be of any size then
the FFF principle comes into play.

Normally it's phrased as "introducing industry standard management
techniques" or similar. Basically if the investor is loooking to sell
on then some suits who're vaguely known & are good at powerpoint &
management-speak give other possible investors nice warm feelings where
.....founders sometimes don't....

Case in point recently is mandrake/mandriva.


Adam

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