I have read this idea in a Spanish post from 2005 by Mario López de Ávila Muñoz. This is a translation to English of Mario's post.
In this post Mario describes "a kind of eBay for start-ups, a market of online auctions in which business initiatives (start-ups) would offer participation in shared capital to the best bidder in exchange for financing or other necessary assets, like for example, social technology, infrastructure, knowledge or networks. This approach involves decentralizing the financing process of enterprising initiatives.
This eBay for start-ups would limit itself to take care of companies on the way to constitution or of recent creation with modest necessities of financing:
Entrepreneur would create a virtual stand with a more or less complete description of its business, including an estimation of his/her financial needs necessities or another type of resources. In return the entrepreneur would offer either some resources in the agreed conditions or a participation in the property of its company. The entrepreneur should indicate what percentage is arranged to yield (in "as much as" terms ), in what conditions, the terms involved in the liquidation in the agreement, etc.
Investors would study different entrepreneur proposals. The proposal that best fits with the requirements would be the winner and would be subject of agreement to a later negotiation.
Online reputation would be essential in this system. This type of relations is only possible under trust and confidence conditions."
From my point of view there are several stages involved in this ideas:
- Meeting point between entrepreneurs and investors
- Negotiation
- Buying Share: this last part is a real Stock Exchange market and may be difficult to implement due to regulations in most countries.
In my previous post (When Investors and Entrepreneurs come together) I have in made state of the art of similar initiatives of this kind all around the world.
Finally I would like to add some comments: In Barcelona (Spain) a company called Euneo Systems is being currently created, This company will try to implement the idea described in this post (or similar). They are still under construction.
Related links (in Spanish):
