The shareholders' agreement - secure your success

You have a product idea that can change the world. To turn the idea into a product, you look for partners. To start, you need advice from experts, then you place orders for implementation and finally you hire employees. All these steps cost money and require stable financing.

If you have enough financial resources yourself, you do not need to read further here.

Otherwise you will look for partners for the financing. These can initially come from your circle of acquaintances (Friends and Family). With time, you may also manage to get professional investors on board. Business partners or key employees are also a suitable source of financial support. Unfortunately, most of the time you will not get these financial contributions for free. The various investors either require collateral (perhaps you have real estate or a stock portfolio) or you want shares in the product (usually stock).

Initially, the idea belongs to you as the inventor yourself. However, as you bring in partners for financing, you give away more and more shares. Initially, this will hardly bother you, since you still own the majority of the shares. Over time, however, you need more and more financial support (usually more than originally in the Bussines plan) and your share shrinks. Suddenly you no longer have the majority and others can decide the fate of your product. It can even get to the point where you, as the inventor and founder, are ditched for a pittance for you remaining stake.

This is exactly where the shareholder agreement comes into play. With it you regulate from the beginning who has the say in the company and how participations (and thus financings) are regulated. The shareholder agreement is an important tool to secure your deserved share of success. But one thing is important to know. You must draw up such a shareholder agreement while you are still in charge - i.e. at the start.

If you want to secure your share of success with a shareholder agreement, Appert Consulting is the right partner for you. Contact us for a free initial discussion,

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