On this thorny
topic, we do not work for nothing, and we do charge consulting fees to reflect
some of the work that we need to do. Our rates vary between R 300 per hour and
R 850 per hour, depending on the consultant and the nature of the work. We will
also ask you to reimburse our out of pocket expenses incurred, for example in
travelling and accommodation etc. For ongoing work, we may enter into retainer
arrangements.
Where our work
includes raising equity or debt funding for your business, most of our income is
of course geared towards success, for which our fees are 5% on the first
R 2,500,000 of funding, 4% on the next R 2,500,000 and so on down to 2%, with a
minimum success fee of R 50,000. In addition, we will take an option or warrants
in respect of shares in your business, written on completion of the investment,
at a strike price equivalent to the price at which shares are ”sold” to the
investor and exercised normally when the investor exits. Usually this option is
for between 4% and 10% of the enlarged share capital. Where an option or
warrant is inappropriate, we will simply hold shares in our client directly.
Where we earn
success fees, we may set off any consulting fees previously charged against the
success fee.
Our business is
based on assisting cash strapped entrepreneurs so we will consider alternative
fees arrangements that include elements of fees as work is performed with the
balance in success fees or equity participation.
Rates are subject to change without notice
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