Asking for advice:
Proposition: Should I look for a massive personal loan to buy all the shares in a project I have been working on for five years?
(If anyone knows me personally and comments the project name, I am sorry, but I will have to delete the comment for political and regulatory reasons.)
Qualification:
We all know that borrowing money to buy shares is a risky decision. However I am hoping that readers can put themselves in my shoes, and then provide an opinion about whether the proposition is reasonable or not, given *my* specific premises. Of course, you are free to comment on the premises as you may disagree with some. Some premises may be more or less fixed, such as the premises about my motivations.
Here are my premises:
- the project is a community-facing business which provides unique and sometimes essential infrastructure to middle-class urban citizens;
- aside from lockdowns while we were closed, we served an average of 100 counterparties per day over a period of five years;
- the project has reinvested most of its profits into R&D specific to our industry; this R&D has yet to be monetised as we have been in roach mode since 2016;
- the project has never taken external investment after incorporating;
- the project has no debt; but does have accounts payable; I am personally the main creditor of the business, by simply not claiming business expenses or wages on time; this credit is interest free; (outside of the project, I usually I use my personal lines of credit from cards or relationships to keep myself liquid);
- recently, for regulatory compliance reasons the project had to turn over the entire staff; currently it has no cashflow to train new staff in the short term;
- there has always been an available opportunity for fund raising, or for any party to consolidate the ownership of the project (it has multiple owners), in order to simplify decision-making processes which are often deadlocked or simply inactive, which in turn have resulted in operational and roadshowing roadblocks since 2016;
- (hence my proposition)
- if I were to go ahead with my proposition, I would not expect to generate a great amount of cash for myself, from this project; however the project would be able to continue towards its original goal of becoming commercially self-sustaining, while addessing a few specific B2C and B2B gaps in our industry;
- if I do not go ahead with my proposition, the project is likely to fail when we become unable to pay the rent; this may or may not subsequently result in write-offs or write-downs in various remaining assets, and then possible deregistration of the corporate entitity;
- I have about 17 days to decide on this before we are late for rent;
- I created this project in order to occupy myself in 2015, as I lacked for activities, whereas I wanted to work on something for-profit in the commercial sector;
- my original background is focused on "academia" (1991-2005), and I have been studying various "industrial" operations after that (2005-2020); on the same trajectory I expect to be working at the "strategy" layer of commerce or government at some point in the future;
- I plan my life around Malaysian minimum wage, and consider any other income a luxury; most of any income I have obtained over the past few years has been reinvested in the project;
- I have no ambitions to raise a family, or to care for any of my existing family members in the future;
- I have no ambitions to be remembered fondly by anyone;
- however, I need something useful to do with the remainder of my time on earth, and so far the project has been useful;
TLDR:
Should I continue to go for broke and commit my future finances to this project?
If you were in my shoes, given my interests (or lack of other interests) what would you do?
Instead of this project, what else might you do?
(Changing my interests is not a useful suggestion.)
Thanks for your suggestions!
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