Professional HelpBy William CatePublished March 1999[http://home.earthlink.net/~beowulfinvestments/] [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]You can avoid pa...
Professional Help By William Cate Published March 1999 [http://home.earthlink.net/~beowulfinvestments/] [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
You can avoid paying professionals by not using them. If you use them, you must pay them. You are wasting your time trying to hire professionals without paying their retainer. If you don't use professional help, it will cost you millions of dollars when you sell your company.
Going to your doctor doesn't ensure immortality. Using a professional doesn't guarantee results. It's why quackery exists in every profession. The Equity Finance Industry is overloaded with quacks, swindlers, confidence men, stock promoters and crooks. Money attracts the worst element in Society. You'll find stock promoters running many public companies. You'll find quacks pretending to be merchant bankers. You'll find swindlers as stock brokers. You'll find crooks running investment funds. You'll find confidence men as investment gurus. Equity Finance is a minefield. Less than 2% of the investors and honest business owners survive the trip across this minefield.
There isn't a guaranteed way to raise risk capital. Consider every option in your search for funding. Some options are pure scams, like Prime Bank Guarantees (PBG). Some options are cost effective, if you have the talent and contacts to make them work, like a SCOR offering for the president of the local country club. Many financing options require professional help, like taking your company public.
You must consider two issues in selecting your path through the Equity Finance Minefield. Does the potential financial reward offset the costs? Is the Professional Help you will rely upon honest and competent?
Without investor liquidity, you have a 25% probability of raising $200,000 with professional help doing a SCOR offering. Your costs shouldn't exceed $50,000. To raise a million dollars, you must take your company public. Doing a spinoff and million-dollar funding for $150,000 are a far better bet. At the 25% probability level, it would be an even money bet to raise $600,000. With investor liquidity, the odds of raising the million dollars exceed 90%. In this comparison, doing a spinoff is thirty times better than doing a SCOR offering.
Crooks dominate the equity finance business. It takes time to find the right professional help. If you don't start your search today, you'll never find the professionals who can help you finance your company. Here are some points to consider as you search for your professional help. 1. Does the Professional have an established reputation? 2. Has anyone filed a complaint against them? 3. Will they work on a retainer? 4. What companies are they currently helping? 5. Does their offer make senses? 6. What are the odds of success?
If you don't hire professionals, it will take you longer to succeed. Your business success won't be reflected in a strong share price for your stock. The money you save today, you'll lose when it comes time to sell your company.
If you sell your private company on its balance sheet, you will earn 1.5 times its pretax profit. If your private company grosses one million-dollar a year, it will be worth about $300,000. If you sell your public company at Market Capitalization, it's worth the price of the stock times the issued shares. If your stock trades at $5/share and you own 3 million shares, your company grossing one million dollars a year will pay you $15,000,000 upon sale.
You can pay for quality professional help now. You can take the loss for the lack of that help when you sell your company. It's another choice that you must make about the future of your company.
To contact the author: Visit the Beowulf Investments website: [http://home.earthlink.net/~beowulfinvestments/] Or, visit the Global Village Investment Club Website: [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
He has been the Managing Director of Beowulf Investments [http://home.earthlink.net/~beowulfinvestments/] since 1981 and is the Executive Director of the Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]