Investors new to CityGuru can expect Drew Morrison, Founder, to ask for additional funding. This is par for the course in investing in CityGuru-Drew Morrison; we have all been there.
As if you’re not already excited about the investment, the story and promises of reward will only get better such that it may even seem like a no-brainer that you should commit a second round of funding. As any good salesman knows: the best time to ask for an upgrade on that new automobile is AFTER the customer has said yes.
But, have you done your Due Diligence? Before agreeing to the upgrade, do you fully understand the investment you have already stepped into? Do you fully understand the risks those funds are exposed to? Chances are: you did not have the relevant information now available to you as when you first wired funds to Drew Morrison.
Typically, investors do not submit additional funds until they have seen specific progress and development of the company they have invested, or some sort of pay-back, such as interest or dividend earnings. CityGuru Investors have not received any return in the past five years, yet you are now being asked to risk more funding shortly after your initial funding!
Fortunately, this is an opportunity to leverage some of that risk to your initial investment by following four simple steps before you wire in that second set of funds to Drew Morrison. We cannot guarantee these steps will protect your savings from loss, but we can assure you that if you follow them: you will be making a wiser, better informed decision on if and how much you are willing to commit as additional funding for your CityGuru investment.
FOUR STEPS BEFORE PROVIDING MORE FUNDING
STEP 1: The best Due Diligence often available to you is —your fellow CityGuru Investors. Many of them have already gone before you; and can certainly share facts with you that perhaps even CityGuru-Drew Morrsion is not inclined to share with you. We will help you to connect with them in the Free Investor Assistance we provide here. Their input will certainly guide you further in the next step.
STEP 2: Discuss with Drew Morrison and/or his “Advisors”, asking and clarifying–in writing—the following questions/issues. Substantiating such details are common in business, and no one should fault your insistent that whatever is discussed and agreed upon is placed in writing. Asking these particular questions are very likely to generate even more questions of your own. Listen to the answers very carefully and ask yourself if you fully understand them. Go ahead: list them all; ask them all; and document the answers to all:
• “How is my money being spent?”
• “How does this expenditure increase the value of my investment?”
• “When can I expect to see return on my investment? Specifics, please.”
• “What sort of financial reporting can I expect to keep me advised of whether my money is turning a profit, loss or flat-lining?” (Hint: verbal progress reports are unacceptable)
• “Can I withdraw a partial or total of my funds in the event of emergency or dispute?” (You will want to listen very carefully to this answer).
STEP 3: Arrange for a third party to hold your investment funds in a trust; along with your sole signatory authority over those funds. Insist your initial funds be transferred to this trust so that all of your money is accounted for. This prevents the same past issues of co-mingling of your funds with that of the Founder’s and other investors. This will also assure you a certain liquidity over your funds when you need them. It will provide you with certain financial control since there is no valid financial reporting provided by CityGuru-Drew Morrison.
STEP 4: Divide your available investment funds into increments. For instance; divide $20,000 into increments of $5,000. Release each of these funding increments to Drew Morrison-CityGuru only as they meet certain milestones you have agreed upon in advance. In other words: make the business prove itself and worthy of more funding. No need in throwing good money after bad in the event the business isn’t adding to your shareholder wealth.
What sort of business “milestones” could you establish for your incremental funding? Upon request, we will be happy to suggest specifics tailored to the terms of your CityGuru-Drew Morrison investment. For example purposes: the following are very noteworthy as a method of performance measurement of the company and your investment:
• Interest or dividend income amount payable to you over a given time period (DO NOT “RE-INVEST” those earnings, which you will be asked to do).
• The company demonstrates a certain level of earning capacity by reaching revenue goals in a given time.
• You have been provided consistent and detailed financial reporting faithfully through a given period.
• Establishment and consistency of a distribution plan for your invested funds; perhaps on a quarterly basis
These four steps may seem rather simplistic. Yet, we can assure you that if you will follow these steps diligently now–you will have covered 90% of the questions that are sure to surface in the future–when you will have no leverage in demanding timely and accurate information.
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