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This is a discussion on Investors within the A Brief History of Cprogramming.com forums, part of the Community Boards category; My brothers and I are gonna go in to business together (the future of Mackrory Web Programming), starting off with ...

  1. #1
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    Investors

    My brothers and I are gonna go in to business together (the future of Mackrory Web Programming), starting off with my MacroMedia Flash competitor. But we need some investors for the costs of Visual Studio (we're going to do it the legal way this time, since MicroSoft won't like what we're doing, and may find every loophole), and also for a business license. If anyone is interested in details PM me.

  2. #2
    Registered User BillBoeBaggins's Avatar
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    Wow that was a vague post. Hope you don't try to hit up any venture capitalist with a note like that.

    First off, unless you become a big enough company to get listed on a stock exchange Microsoft probably isn't interested in you no matter how much of a threat you think you are.

    A couple of questions an investor might want to ask..

    What are your services?
    How much capital will you need?
    How long till you become profitable?
    Who are your direct market competitors?
    Who are your indirect market competitors?
    How will you price your goods/services?
    What makes your services better/different?
    What is your forecast earnings for the next year?
    What will I get out of this deal?

    Just remember real investors with big change aren't guppies and definitely aren't fools, they are in it to make a buck, and if that means if they have to take it out of your hide, then so be it...

    But good luck in your venture.

  3. #3
    BMJ
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    Explain to me how this is an investment, and not a donation?

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    King of the Internet Fahrenheit's Avatar
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    I have a shiny dime with your name on it.

  5. #5
    ¡Amo fútbol!
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    Originally posted by w00tsoft
    I have a shiny dime with your name on it.
    But since it'll cost 32 cents to mail it to you, you owe me 22 cents.

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    Super Moderator VirtualAce's Avatar
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    I have one nagging question.


    How old are you two?

    I've been the owner/operator of a private business before and I'm telling you....it's not all roses and infinite cash flow. You are going to have to produce a product or some very detailed layout of what the product is, how much you expect it to bring in, how much you expect it to cost, how much you expect to lose, etc., etc. etc.

    There are losses in everything - even software....actually, especially software.

    And between you and I, I cannnot stand MS business practices, however, I'm not going to say they are stupid or that I could do it better. Even though I dislike their business principles they do deserve some respect for what they have become - its not a personal dislike - its just business.

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    It's an investment because anyone who contributes to the starting will recieve a larger amount of money from the profit of the project. We can do later projects on our own.

    I'm 16, he's 28, and there are two others in between who may be getting into it if this works out.

    We have the free trial versions, and I can make a finished product on that easily, I can show that to everyone before they make a final decision and actually give money so I can buy the licensing to make it legal.

    I was just wanting to get an idea of who would be interested. We'll work out the details once I have enough people. Expect something like 150% return.

    edit: and I'm not even 100% sure if this is the only option. We're still looking at licensing for the demo copies he can get at BYU. I just wanted to get a jump on it just in case.

  8. #8
    'AlHamdulillah
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    well, besides what has already been said, where is a systems diagram, detailing the different parts of the program, what are your system requirements/system specifications(anyone who knows commercial programming knows I am not talking hardware here). If you don't have those ready, that's one more reason not to invest in you. What are your previous coding exploits, do you have any code for this project, what about code for previous projects?

    If you tell us just one thing, what is so revolutionary about your product that makes it worthy of commercial release and not just an open-source project(which come pretty damn close to commercial in some cases).

    Im sorry to say this, but you can't come into a bunch of strangers and ask for investment unless you have a solid plan and have proof you already are involved in the plan to your fullest extent.

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    Registered User CompiledMonkey's Avatar
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    This thread made my day...

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    Toaster Zach L.'s Avatar
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    The biggest thing I see that this is missing is, well, a business plan of any sort, much less the kind that would actually interest investors.
    The word rap as it applies to music is the result of a peculiar phonological rule which has stripped the word of its initial voiceless velar stop.

  11. #11
    Super Moderator VirtualAce's Avatar
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    150% return is rather large I'm thinking. In my business which had an extremely low overhead I was fortunate to get about 75-80% gross controllable profit. From that then I had to deduct expenses, etc. My pricing was where the gross profit was, but after expenses net profit was about 60%. Not bad at all, but not always easy to do.

    150% is far too unrealistic for me. I'm sure that Microsoft, by now, could probably swing that type of figure...but not some upstart software company. First year of business or more is simply getting your name/product out there - you will be lucky to turn any profit much less 150%. So first few years are pure capital and then once you have a good customer base you can start making actual profit - and start paying off your loans that helped you start the company.

    There are banks out there that will help you start a company and there are also government grants/loans that are given out if your company meets certain criteria. The big problem with gov. subsidies for your biz is that they have some very very strict guidelines that you must follow, or you could face nasties like income tax evasion or other fraudulent activities - even if you don't know that you are doing it.

    Check with your local Chamber of Commerce to see how many other software biz's are in your area to get an idea of the competition. While you are there check with them on getting a name - there is a huge book of names that have already been taken - pick one that hasn't and register it. Then get your business license for that area under that name and get a tax number just in case you do business with local charities; hence tax write-offs. Also make sure you know the stipulations for your business name. For instance, in Missouri you can pick a name to do business under, but it is not a copyright and it only lasts for I think 5 years or so - and if you go belly up, another business can take your name. But, in Texas, the name is good for 10 years and no one else can do business under that name nor can they take that name even if the company it represents has gone bankrupt. Laws differ in all states as well as costs for business licensing.

    Also you will want to get a distributor that will get your product out there and then you need a salesperson or several that will agree to sell the product at a lower cost and in bulk to software vendors. Shipping is very expensive - try to get a shipper to ship 1 lb for about .25 or less - they are out there.

    As well to give a much better image to your customers you will want to have either some type of storefront (if it applies) or a building in which you do business. Home-based businesses do work, but IMHO having a separate building looks much better and more professional. Since you do not need local customer business - rent for this type of building should be low and should be in a small business zone - fairly cheap. The more exposure though, the more the rent.

    I'm thinking there is a lot to this that you have not thought through - also box design and box construction will probably have to be outsourced at a fairly reasonable cost - since you probably do not have in-house staff and/or facilities to do this.

    Chamber of Commerce is your first stop - then the banks.

    The only way around most of this is to find a publisher - which is not going to be easy. Many of them have very strict guidelines; they are there to ensure that the publisher does in fact get a profit from your product. If you don't meet the guidelines then you are to big of a risk for them to agree to publish your title.
    Last edited by VirtualAce; 12-26-2003 at 10:27 PM.

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