My company is in the process of raising additional capital for my semi start up website. Currently we are in a beta testing phase with the intent of testing the functionality of the site on a larger scale. At the moment we have a few hundred registered users but have not gained a tremendous amount of traction to this point which has been done on purpose.
We have met with a couple of investors to date but considering the stage we are currently in as a start up, they are wanting a bit too much equity than we are comfortable giving up. However, I am of the addage that its better to have a little bit of something then a lot of nothing! I have explored and understand the convertible debt to equity concept and of course there is just a straight equity swap, but I am looking for other ways to limit founder dilution in case additional equity might be needed moving forward.
I have heard of deals being structured in ways that allow the "founders" the ability to give up a little more equity in the short term with the long term goal of buying it back. Essentially ways to structure deals that in the long run cause minimal dilution. Obviously I realize that if I want the money I am going to need to part with equity on some level but if anyone has any additional suggestions I would really appreciate it!
Thanks in advance for all of your time and consideration!
-Robert J. Dolle