How to share an idea

The concept of "share in the company" can be defined as a direct financial interest in the property, and the degree of intervention in the management of the investor. If venture capitalists are rarely willing to take charge and responsible for more than half of the project, it does not mean that most of them will leave the team and start-up lead. Of course, variations are possible. For example, a business angel, found even before the official launch of the 2008 service for event organizers TimePad, limited to less than 10% of shares in the company's management does not intervene. According to the developer and commercial project director Lyudmila Pavlova guide completely left in the hands of the three founders. Ruslan Sinitsky of Hivext also says that the venture fund Runa Capital, in December 2010, invested $ 500 thousand in the project cloud platform for building Web services in the operational management of the company does not intervene. However, Lyudmila Pavlova is a situation likely thinks "a happy exception": the Russian investors rarely invest in projects at this early stage, and under such conditions. There is another extreme: for example, venture capital fund Fast Lane Ventures itself generates business ideas, and then invites a hired manager and forms a team from scratch. That is, the share of stock in the project initially is 100% and only then eroded by management and new investors. However, in most cases it is enough for the average scenario, and, as shown by communication with investors, this scenario is not very soft to the creators of the project. Invaluable contribution. Of course, any investor claims that he is interested not only a qualitative idea, but hard-working, interested team. But in fact it turns out that, no matter how strong this team may be, make sure that all steps for the development of the project will be performed correctly, can not be. Add to that the obvious risks of fraud or at least not just loss-based, it becomes clear that one way or another, the team has to "dilute". Managing partner of venture capital fund Almaz Capital Partners Alexander Galitsky says full control over the project investor is not required. Usually, it redeems fund the project from 15 to 45%. "Professional investors never buy more than 50% of the company because they do not want to take control into their own hands - Alexander Galich. - His task - not to conduct operations, and strategically direct the business so that independently developed its founder company. " However, the contribution of the investor is not always limited to the money. "There are passive investors, whose main task - to give money and wait for their share will rise in price. So very often behave in later stages of investors - says investment manager ABRT Venture Fund Pavel Nikonov. - But the seed stage and start-up may be more important to be no material issues, and advise or assist in establishing linkages. " Spectrum of the "invaluable" services is quite wide: from a standard package of advice to aid in scaling the business model. And many managers, in their own words, much of the daily working time is spent on solving the problems of portfolio companies. For example, ABRT, according to Paul Nikonov, deals not only with the selection of personnel, but also in marketing, increasing sales, developing and expanding the product line and even technical support. "Investor early stage may be useful contacts and an initial consultation, and from late-stage investors expect appropriate to assist in scaling the project and finalizing the strategy," - he explains. In reality, this means that, even redeemed for cash only 10% of the company, the investor is often intended to qualify for a much bigger impact - up to full control. This control is not always reflected in the allocation of posts. "Traditionally, when receiving investment in the company of a Board of Directors, which includes investor and - agrees Alexander Galich. - The Board engaged in strategic planning, development strategy and restructuring, as well as the use and management of the budget of the company. " The norm is when the board of directors composed of five persons - two from the investor and the company plus one independent director. If the council should be expanded, it usually occurs at the expense of independent members. And if, for example, business angels are often involved in projects to clubbing - so risks are lower, this does not mean that the presence of the board of directors of the project representatives from each investor. "We have always assign a supervisor who reports on the status of the company and represents the cooperative's board of directors" - the chairman of the Association of Business Angels of Russia (SBAR) Alexander Kashirin. But the two council seats will be an investor, even if the company he owns, only 10-15% of the property - though only if the investor knows what the "right to negotiate" with the team, said Alexander Galitsky , who had experience in investment at different stages. "Business-Angel manages his money and he appreciates their own risk, and managing partner is responsible not only for their own, but for other people's money - he said. - Angel and can not participate in the activities of the company and expect to be the case - it works more on emotion than on risk assessment, but the venture capitalist must always remain professional. " "Investor traditionally does not interfere in operational management, but has the right to vote on key issues - says the managing partner of Runa Capital Dmitry Chihachev - a set of these issues fairly traditional: firing, hiring, rewarding key employees, the company budget and actions affecting the interests of shareholders ". It is essential that the investor owns the project, even minority interest, was able to control the decisions a manager and, in certain circumstances require a change CEO, agrees Alexander Kashirin. Most often for this purpose are the special shareholder agreement governing the balance of power on the board of directors of the company, as well as establishing specific requirements for decision-making council. Will be grateful. As a result of complete freedom to the creator of the project is only part - namely, the freedom to work. "It is important that the team was simply nowhere to go but to create a project" - put it on this occasion one of the managers. "I always ask the developers, they do not have anyone on the team," - says Alexander Galitsky experience. The answer is not always obvious. For example, if a manager cope with the "acceleration" of the project from scratch to a turnover of several million, it does not mean that he is able to maintain success in entering the turnover in the tens of millions. "It is important to evaluate the company in six main areas: marketing, sales, support, product development, finance, human resources - and determine where the strengths of the founders, and where to hire a manager to call" - sums up Galitsky. "In my practice was a case where a company had to find a new CEO - says Pavel Nikonov - of course, not all teams are happy arrival of new management personnel, but where the developer entirely busy creating his own product, he is even thankful for that all administrative work takes on someone else. " A team, believes that "all she can" - potentially a conflict environment, he said. However, the investor can understand, if only for a team that suits the release can only be a start of the project, and for this you can go to make serious concessions, then the investor is important, above all, to guarantee the repayment of funds. "If I put a million at the current value of the company at 10 million rubles, it is important that if I could in three - five years to get over their share of 10 million rubles - that is, if, by my reckoning, the company during this time will not grow at 10 time, then I demand to pay more than 10% despite the current business performance and its assessment ", - says Alexander Galich.