It happens quite often that when I’m having a meeting with a potential client, I am asked if we would be interested in equity in the company. This is a very difficult question to answer because there are many variables involved with making the decision. There are usually many unanswered questions the client has difficulty answering.
1. Have you found out from other people that the problem you’re solving is also a problem they encounter?
2. Have you identified anyone who could fund the project?… ie. Venture Capital or Angel funding organizations or family members.
3. Is this a real problem that people would be willing to pay for?
If the potential business answers these questions than there is always the possibility of a joint venture. If not, it’s usually back to the drawing board or off to a meeting with the revenue doctor.