Angel Investor Question

[GeorgiaAgent]

I have been lucky enough to find an angel investor who wants to invest in my start up independent agency; along with the capital he has a lot of really good connections in our city as well. With the money on the table, he would like me to propose several repayment options; I have considered multiple ideas using debt, equity, or a combination of both, but this is not an easy task.

Does anyone have any experience with this? I want the repayment options to be fair for both of us and the business.

I cannot respond to private messages because I do not have enough post...so if you have any advice please respond on this thread.

Thanks in advance.

 

[fastrack1]

I have been lucky enough to find an angel investor who wants to invest in my start up independent agency; along with the capital he has a lot of really good connections in our city as well. With the money on the table, he would like me to propose several repayment options; I have considered multiple ideas using debt, equity, or a combination of both, but this is not an easy task.

Does anyone have any experience with this? I want the repayment options to be fair for both of us and the business.

I cannot respond to private messages because I do not have enough post...so if you have any advice please respond on this thread.

Thanks in advance.

What does he want? Just a decent return on his money or a piece of your success? If possible, just try to give him a rate of return on his money that is very good. That way there is a limit of his profit.

 

[xrac]

I have been lucky enough to find an angel investor who wants to invest in my start up independent agency; along with the capital he has a lot of really good connections in our city as well. With the money on the table, he would like me to propose several repayment options; I have considered multiple ideas using debt, equity, or a combination of both, but this is not an easy task.

Does anyone have any experience with this? I want the repayment options to be fair for both of us and the business.

I cannot respond to private messages because I do not have enough post...so if you have any advice please respond on this thread.

Thanks in advance.

Typically an investor will want a 15-20% return on their money. Truthfully most of us look for partners or investors because we want reassurance and are afraid of risk. There is probably more risk in having outside investors because of their demands and expectations. I spent nearly 1-1/2 years looking for investors for a start up business. I finally did it with no investors and bootstrapped it up and was glad that I did. Most people don't need nearly as much money as they think they need if they are smart with what they do. The actual beauty of insurance is it doesn't take a lot of capital.

 

[djs]

In general, I haven't met to many angels that work with limited profit potentials.

Not near enough information here to even begin.... Only you will know what is right, but don't worry, if it's wrong, you'll know that to.

- Why do you need an angel investor? This sounds like wanting a large office, receptionists, producers, etc. That's okay if that's the way you are going.
- What are you trying to accomplish with an angel investor that you can't accomplish on your own? I'm assuming this is not a life and health agency, but a multi-line P&C agency?

The hard part with angels is they are motivated in strange ways, but all of them are looking for a fairly significant upside. They always want a bigger slice than what you would pay if you got a small business loan, which is what I would recommend checking out first.

The good news is, even talking with an angel makes you have a business plan, which is crucial to long term success.

 

[joshril]

Most angels I have seen what a "piece of the action"... or a ridiculous rate of return. If this guy brings something to the table in the way of connections, do an equity deal. This can be lucrative for both of you... Of course as mentioned above, if you are incredibly successful it could cost you more than a debt investment...

 

[ALG]

Have you proven yourself has a successful Insurance agent. If not save both of you a lot of grief. Prove your self and system then look to expand with help of others capital.

 

[williamsassoins]

Most angels I have seen what a "piece of the action"... or a ridiculous rate of return. If this guy brings something to the table in the way of connections, do an equity deal. This can be lucrative for both of you... Of course as mentioned above, if you are incredibly successful it could cost you more than a debt investment...

Couldn't agree more.

 

[joshril]

What kind of help are you looking for besides operating and start-up capital? The reason that I ask is that my firm, which is an IMO, specializes in getting new agents set up in this business. And yes with a good business model would even consider helping establish an office. I do already have several offices set up across the southeast, and about 150 agents, so in the marketing world I am still somewhat small, but I am able to give people personal attention when needed. I have my key people in place over all lines of Insurance, and I mainly focus on the Securities side of things. The biggest piece of advice I would give a new agent in this business, Is do not over educate yourself to the point of doing nothing. I see more people that would be good in this business, but they never take the first step.

Another point to consider is that all marketing companies keep about 30% of all business that is written though them. So with that being said I have the only marketing company that pays out above street commissions to every agent, meaning that you get to keep more of your commission, thus meaning you have extra money to get an office started. Depending on the level of support you need means that I can operate on next to nothing if you do not have to call me or my office to follow up on all of your business, but ultimately the choice is yours. Write this blogback if you would like some more information. Happy Hunting and Good Luck!

I'll bite... What companies do you work with? What lines of business? What do you consider higher than street?

2 posts and already advertising...

 

[Crabcake Johnny]

What kind of help are you looking for besides operating and start-up capital? The reason that I ask is that my firm, which is an IMO, specializes in getting new agents set up in this business. And yes with a good business model would even consider helping establish an office. I do already have several offices set up across the southeast, and about 150 agents, so in the marketing world I am still somewhat small, but I am able to give people personal attention when needed. I have my key people in place over all lines of Insurance, and I mainly focus on the Securities side of things. The biggest piece of advice I would give a new agent in this business, Is do not over educate yourself to the point of doing nothing. I see more people that would be good in this business, but they never take the first step.

Another point to consider is that all marketing companies keep about 30% of all business that is written though them. So with that being said I have the only marketing company that pays out above street commissions to every agent, meaning that you get to keep more of your commission, thus meaning you have extra money to get an office started. Depending on the level of support you need means that I can operate on next to nothing if you do not have to call me or my office to follow up on all of your business, but ultimately the choice is yours. Write this blogback if you would like some more information. Happy Hunting and Good Luck!

This is your 3rd post and second pitch on this board - which is fine however can we all know a little bit more about you and your agency?

Why don't we start with your name and agency's name and work from there

 

[insuranceexec]

I'll bite... What companies do you work with? What lines of business? What do you consider higher than street?

2 posts and already advertising...

Your Quick, and I appreciate your enthusiasm, I have also tried to give some good, helpful information to the person asking............ I work with all of the major carriers on the life and health side i.e. Allianz, Aviva, Banner, NYL, Met, Lincoln, the hartford, mutual of omaha. I personally stay away from any company that is not rated at least A or better. On the P&C side we deal with almost all sub companies, those dealing with sub-prime. The preferred carriers we use are: SafeCo, Natiowide, and Prud to name a couple. I do not deal with the comp on the P&C side but can get those numbers if that was what you were inquiring about.

On the Life and Health side I will give you 2 examples one for life and one for annuities.

Allianz Master Dex 5 the street comp is @ 9% some companies pay 10%, and providing that I do not have to give alot of suppost I can start you at 11.25% and get you to 12% with proven production.

On the life side you and I would have to agree that Banner Life is a good company paying roughly 105% top street. I can start an agent @ 118% and they can cap out @ 128% again with proven production. I hope this information was helpful and would like the oppurtunity to possibly earn your business in the future. Happy Hunting and good luck