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| Professional Help |
By:
William Cate |
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Professional Help
By William Cate
Published March 1999
[http://home.earthlink.net/~beowulfinvestments/" target=_blank>http://home.earthlink.net/~beowulfinvestments/] [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/" target=_blank>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/" target=_blank>http://home.earthlink.net/~beowulfinvestments/] Or, visit the Global Village Investment Club Website:
[http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/" target=_blank>http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
About the AuthorHe has been the Managing Director of Beowulf Investments [http://home.earthlink.net/~beowulfinvestments/" target=_blank>http://home.earthlink.net/~beowulfinvestments/] since 1981 and is the Executive Director of the Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/" target=_blank>http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/] |
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