I read an article from Dec 2011 this week in a consulting room, in an entrepreneurship magazine. The business owner was complaining about the venture capitalists wanting in excess of 51% equity in return for their investment. This does not sound the venture capitalists I know of. They do not want a majority share. The 3 key areas they normally are interested in the team, the vision and the harvest plan. The last thing they want to do is invest in a business and have to run it.
The worst thing was the columnists response, which was to advise the owner that he must make sure of their intentions and similar platitudes. The columnist is part of the problem as he obviously has no idea what he is talking about and is consequently becoming part of the problem as opposed to being part of the solution. I do not think the "investors" were venture capitalists. they were quite likely angel funders or opportunists.
Anyone taking more than 51% is buying your business. Do not do this unless you understand what the implications, financial and legal, are if this happens. Please check with your accountant and lawyer, not some idiot columnist who could cost you everything.
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