If you’re having trouble finding investments for your business venture then you should appreciate the approach that James Layfield has taken to find financing.
Filled with business ideas and frustrated at the lack of funds, James has decided to offer up 10% of himself to investors, reports the Business Standard. That 10% piece will cost a total of Â£1 million, giving himself a total value of Â£10 million.
Under the terms of this new and unique offering, Layfield has put on the table a 10 per cent stake in himself, which would mean, a prospective investor would get this stake in any business he floats in the future. He admits he expects investors to take a leap of faith, but cushions any major risk in this proposal with a buyback offer at four or five times the value of the original investment over a four- to five-year period. This, he says is a two-way deal, where he can also be at a liberty to buy back the stake from any investor.
“The market is flooded with opportunities in today’s conditions. It is to see how I can help investor’s see the opportunities,” he says. He believes that selling a stake in one business would mean that investors would have to place all their bets in one basket. By offering a stake in himself (and therefore all his future businesses) the investor is well insulated he says. “(Sometimes) the idea itself is the barrier. Small things can put you off.”
He is currently in talks with two or three investors. Though one investor has agreed in principle to invest 2.5 per cent of the 10 per cent Layfield is offering in himself, he wishes to close the 10 per cent stake sale in one shot. So until he finds a buyer for the remaining 7.5 per cent the first investor has been put on hold.
Photo by AMagill