I for one would not be discussing your particular subject on a public forum, you give enough info for parties involved or the "client" to work out who you are or at least have a hunch. Asking for info on a public forum on how to prepare a business plan, to me, in this scenario, would not instill confdence...
You never know who is on AAM??
Hey It does not give me any clue, but if the client read it, I thinlk they would know.
Sorry, its just the 1st thing that sprang to my mind reading it.
Hi Icarus,
If I understand correctly, this payment is the acquisition cost of a significant first client. Treat it that way and I don't think you will have too many problems.
In many new businesses, significant money is spent up-front in trying to attract the first few customers/clients, and you have already done this. For a fledgling company, I think having a key reference client is critical and any investors will understand this. In addition, the acquisition cost is known, which removes a huge amount of risk.
I think you'll be fine.
Best of luck with the venture - where are you going for source of funding? The usual 3F's??
You can call it whatever you like. It can be a line item under 'cost of sales', but most likely it is better to highlight it as a separate line item, as 'Reference client acquisition cost', so that investors realise that it is a once-off cost and that you will not be incurring such costs for subsequent clients.
Its an exciting time - I started my business about 5 months ago and haven't looked back...Let us know how you get on
Hopefully the client isn't just stringing you along to recover the original debt.
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