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My friend's clothing company is doing extremely well, and he was looking to expand into some other areas. I suggested to him that we could partner on a line, and I would also be interested in buying part of the company. He would prefer I become an investor, rather than an owner, but he's open to either.
The total amount we were looking at was between $25,000 - $30,000. I have no experience getting a business loan, and really don't know where to start. I see lots of search results for getting a loan to buy a business, but not much for getting a loan to invest in a business. I have several questions about the process:
Is the process the same whether I'm buying or investing?
Is there any difference if I'm buying part of the business, instead of the whole thing?
Any recommendations on companies I should try to work with?
What kind of documentation will my friend need to provide if I can secure the loan?
Thanks in advance for any advice!
@DeeBee78 wrote:My friend's clothing company is doing extremely well, and he was looking to expand into some other areas. I suggested to him that we could partner on a line, and I would also be interested in buying part of the company. He would prefer I become an investor, rather than an owner, but he's open to either.
The total amount we were looking at was between $25,000 - $30,000. I have no experience getting a business loan, and really don't know where to start. I see lots of search results for getting a loan to buy a business, but not much for getting a loan to invest in a business. I have several questions about the process:
Is the process the same whether I'm buying or investing?
Is there any difference if I'm buying part of the business, instead of the whole thing?
Any recommendations on companies I should try to work with?
What kind of documentation will my friend need to provide if I can secure the loan?
Thanks in advance for any advice!
1. Get an attorney involved and have proper investor or partnership/shareholder agreements in writing
2. Don't do business with friends
@Bobbyjohnson wrote:
@DeeBee78 wrote:My friend's clothing company is doing extremely well, and he was looking to expand into some other areas. I suggested to him that we could partner on a line, and I would also be interested in buying part of the company. He would prefer I become an investor, rather than an owner, but he's open to either.
The total amount we were looking at was between $25,000 - $30,000. I have no experience getting a business loan, and really don't know where to start. I see lots of search results for getting a loan to buy a business, but not much for getting a loan to invest in a business. I have several questions about the process:
Is the process the same whether I'm buying or investing?
Is there any difference if I'm buying part of the business, instead of the whole thing?
Any recommendations on companies I should try to work with?
What kind of documentation will my friend need to provide if I can secure the loan?
Thanks in advance for any advice!
1. Get an attorney involved and have proper investor or partnership/shareholder agreements in writing
2. Don't do business with friends
1.you can find these online where you fill in the details and it creates the legal document and you take it together and have it notarized so it's legit... couple different legal websites will even let you sign up for a free trial of a membership and get the document and then cancel.
2. the chances of getting a straight business loan are about none and none especially with sub 700 credit scores but you may qualify for a personal loan through sofi.com loanme.com, prosper, lendingclub... I like the first 2 best because they loan more and lower rates and you can get pre-qual for amount and rate with just a soft credit pull.