I had a meeting the other day with a very talented musician. He’s been preparing a brand new album and he wants to begin operating as a real business.
We’ve had a few new potential clients wonder how our CXO assistance would fit into their firm. Not that they doubted we could provide excellent Chief Financial, Chief Executive, or Chief Research Officer capabilities, but how we could interface with their folks and improve their operations long-term.
I’ve spoken many times about the changes coming to venture funding companies. But, the point of view I’ve presented has always been from the entrepreneur’s side.
Over the years, we’ve considered raising money from VC, going public, or simply bootstrapping. To be honest, the most frequent process we’ve started new companies has been bootstrapping. In so doing, we maintained total control of the firms. And, when we finally exceeded our ability to grow the firm (or in more than a few cases, proved our concept and no longer had the desire to run the firm), we’ve sold the entity to others.
Way back when, we helped several clients raise funds from “accredited investors” using SCOR (Small Company Offering Registration) programs. (These were often called U-7s, since that is the form that is employed for the offering.) This limited the capital raised to $ 1KK, but often provided just what they needed to “capitalize” on their markets. And, in at least two of the cases, provided the investors magnificent returns when they were acquired. (The other companies still provided a return to their investors, but more along the lines of a 10 to 14% gain.)