When you are looking to start or buy a business with partners or investors, never forget the 20% rule. If any individual owns 20% or more of a business, they will be required to guarantee any company debt personally. Passive investors rarely are willing to personally guarantee debt for a company they are not actively involved in.
If a passive investor owns 20% or more of a company and the company needs debt in the future, that can often create a difficult situation.
Want to learn more about how to structure partnerships before making an acquisition? Join us for a webinar next Wednesday at noon est. Join here: https://ax1e70vo.pages.infusionsoft.net
I hope that everyone enjoys their long Labor Day weekend. I will see you Tuesday.