Comments on: How do you enlist financing help without succumbing to finder’s-fee-extortion?

By: danberte

danberte — Sun, 27 May 2007 17:26:56 +0000

Matchmaker A shoud get the royalty, leaving him deal with his contact chain.}

By: bsenftner

bsenftner — Sat, 26 May 2007 14:50:56 +0000

We were bing informal, no agreements, at first. Essentially enlisting personal contacts. Now we have an agreement, that lists out a decending percentage for each party in a relationship chain.}

By: slashchick

slashchick — Sat, 26 May 2007 01:30:59 +0000

I think it makes sense to just put a clause in your contract that if they do not directly refer an investor, they agree to split the fee evenly with all those in the “chain”. Obviously, find a lawyer and legal-ese this. The lawyer I use, Jim Burk of Burk & Reedy, would be an excellent resource to answer questions like these. He wrote a book called “Financing Your Small Business.” Here is his site: (link) You can contact him on the phone.}

By: paulrbrown

paulrbrown — Fri, 25 May 2007 23:41:43 +0000

Two questions:

1) Are these guys all appropriately licensed for this sort of thing (i.e., are they broker-dealers)?

2) Do you have a contract with any of them?

Three suggestions:

1) Pay exactly those you have a contract with.

2) Sever your relationship with the problem individual.

3) Ensure that your non-disclosure agreements have teeth, and enforce them. It will help you to control who is allowed to shop your deal.}