Investment & Financial Articles
Title: Professional Help
Author: William Cate
Article:
Professional Help By William Cate Published March 1999
[http://home.earthlink.net/~beowulfinvestments/]
[http://home.earthlink.net/~beowulfinvestments/globalvillageinves
tmentclubwelcome/]
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/globalvillageinves
tmentclubwelcome/]
About the author:
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/globalvillageinves
tmentclubwelcome/]
|