Are you wondering how to bring new investment into your business? There are three primary ways to attract new capital into your San Diego LLC or corporation:
- Adding Member(s) or Shareholder(s) (and modifying the associated operating agreement or shareholders agreement)
- A Private Equity Offering
- Taking Your Company Public (IPO)
As there have been less than 100 companies going public nationwide each year for the past several years, we will focus on the first two.
Add an Investor, Member or Shareholder
If you wish to add operating capital you can simply add the investor as a member or shareholder. There will be issues surrounding control of the company, voting interests, day-to-day management decisions and allocation of profit. It is in the interest of our clients to provide appropriate security and/or return on the investors equity without surrendering too much control.
There are also laws regarding the structure of a corporation, how many investors you may bring in and as well as the types of investment. This is why it is important to work with the San Diego business attorneys at the Watkins Firm. We bring more than 40 years of experience to strengthen your side of the equation. We help to prevent securities violations while seeking the quality and amount of investment you seek.
Adding an investor, shareholder or new member can also infuse talents, skills and knowledge the company’s leadership may not presently possess. The operating agreement or shareholders’ agreement and bylaws must be updated to reflect all changes and to prevent a dispute between investors, shareholders or members down the road.
Private Equity Can Bring New Investment Into Your Business
Another option to bring new investment into your business or corporation is a “private equity offering.” A private equity offering is an excellent tool for raising needed capital without offering participation in control or management of your company. There are complex federal and state securities laws that govern private equity offerings and failing to execute every step of this process correctly can expose your company to financial liability, and you personally to criminal charges and the loss of your personal freedom.
It is important to work with experienced San Diego corporate attorneys who can keep everything legal, manage contracts and changes to corporate documents and protect your interests while helping you to accomplish the goal at hand: bring new investment into your business to help your company not only survive but thrive.
The attorneys at the Watkins Firm have decades of experience and expertise in these matters, and we will provide a complimentary and thorough consultation for you. We
invite you to review our podcast Episode 34 – Business Formation as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.
We will discuss your goals, the nature of your company, and work to establish effective options to attract and deploy the new investment capital you need to grow and succeed.
