URGENT- accelerator terms

[luckyrosie]

They want:
- 7% equity
- 5% of revenue indefinitely
- 10% of funds raised in future rounds

They’re giving:
- $0 cash investment from them in exchange.
- They said they’ll fly to a pitching event we’re attending to “support us” and then they’ll also pay the marketing agency we want.

Our product is still being built and we don’t have customers yet.

 

[beslowtoanger]

@luckyrosie Why in the world would you do that?

They must be creating an insane amount of value to justify that and honestly this rather sounds like a scam

 

[olagato]

@luckyrosie "10% of funds raised in future rounds" like they take the fund raise funds? Or they get a pro-rata. The first sounds illegal. And yes all of it sounds like a scam.

 

[luckyrosie]

@olagato Like they want a cut of what any investor they refer to us gives us

 

[jeromiusintoonesimus]

@luckyrosie Sounds steep. Negotiate for better terms or walk away.

 

[anniereborn]

@luckyrosie Tell them to get stuffed. Modify all the rates, maybe build an escalating scale, and counter with performance clauses and a drop dead date that if they don’t perform on their end, the whole deal shutters

 

[ozziesmom]

@luckyrosie It's a scam, which program is it?

Likely not even a program you want to negotiate with since that deal does not seem like one created in good faith.

 

[njrocks]

@luckyrosie Not good. Which accelerator is this?

 

[bearded_one]

@luckyrosie So they want all that potential money from you for forever in exchange for $3k to fly to one pitching event and let you rehearse with them for a couple hours, plus $10k for a marketing contract? Tell them to get fucked. But first, tell us who they are so we know who to stay away from.