Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
In the first part of this series, I outlined the general characteristics of an ‘investment grade’ opportunity. I also described how the process can so easily end up being a waste of time for both investors and entrepreneurs. Continue reading “The Money Chase: What Does Investment Grade Mean? Part 2” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Related Articles:
~~~~~~~~~~
Entrepreneurs frequently enter the money chase much too early in the game. They often start as soon as they have a business plan finished; if not before. Most presentations that investors see fall into this category. The results are beneficial to the investors because they get regular insights into developments within a space they find interesting. Continue reading “The Money Chase: What Does Investment Grade Mean? Part 1” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Venture funded companies exist in an uneasy truce between management and their investors. This is a healthy situation. The objectives of the investors are ordinarily different from those of the management team. Investors tend to see their participation in the company within the framework of an investment. They put up $X at the beginning of month one and expect to receive, at minimum, $Y within a fairly short time. For early-stage investors, a short time means anything from twenty-four to sixty months. They see themselves in a very risky business and attempt to mitigate that risk by spreading their investments over a portfolio of companies. Investors are in the business of extending their wealth. Continue reading “The Money Chase: Breaking the Truce” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
http://www.smashwords.com/books/view/53236
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Very few entrepreneurs take the time to really study their company from the perspective of an investor. Those that do are often initially frustrated by what they see as a heartless and antiseptic assessment of the object of their passion and dedication. But, if they fight through those self-justifying tendencies and come to understand the investors perspective, they can substantially improve their chances of fathoming the process and, perhaps, of getting funded. The investor’s world is quite different from the entrepreneurs in many ways. But there are also similarities. Continue reading “The Money Chase: Oil and Water” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
http://www.smashwords.com/books/view/53236
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
I attend a fair number of ‘presentation events’ over the course of a year. Mostly they have the same format. A panel of investors has been brought together. Applications for submission have been received from a wide range of start-up companies seeking funding. The applications have been reviewed and a lucky few have been invited to present. The room is packed with investors feeling important and the center of attention, nervous teams going over their last minute check lists and envious audience members. As the program advances, it is clear that many of the presenting teams have not asked a very simple question. Should they be in the Money Chase at all? Continue reading “The Money Chase: Should You” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
There are many ‘types’ that investors routinely avoid. Angel investors and venture capitalists sit through a lot of presentations in the course of a year and see almost every kind of founder that they want to avoid. Of course, there is a complication. Sometimes the presenters unwittingly give the impression that they fall into one or another of these categories. It is never a tragedy when one of the bad apples is identified and avoided. But it is a tragedy when a legitimate proposal from a competent team is dismissed because they carelessly tagged themselves as one. Investors have to make lots of decisions in relatively short order. It is important not to give the wrong impression in these early meetings. A bit of creative preparation goes a long way towards avoiding such an outcome. Continue reading “The Money Chase: One Way to Avoid Being ‘Avoided’” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
http://www.smashwords.com/books/view/53236
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
The Money Chase is the graveyard of many a start-up. It can drain the energy and resources out of a new company and leave the founders frustrated and bitter. For many, seeking angel or venture capital investment is the most complex and subtle effort they have ever made. Most money chases fail because the founders do not have an investment quality company. The others fail because they either mismanaged the process or misunderstood how a successful money hunt should be managed. Yet others fail because they are simply not credible as entrepreneurs. This article is about that last group. Experienced angel investors and venture capitalist are always on the lookout for them and seldom take them seriously. Here are some types that they normally see and, for the most part, avoid: Continue reading “The Money Chase: Who They Do Not Invest In” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
After the rush of figuring out a new idea for your business and pulling together a team to run it, one challenge faces all entrepreneurs. They must find the necessary financial resources. For some, the ‘money hunt’ can come to dominate their activities. Others find solutions that allow them to at least launch the business. Many companies founder because the team never figures out how to meet this challenge. How you meet this need is one of the most important steps in determining if your company is at least going to have the chance to succeed. Continue reading “Funding Strategies for New Businesses” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
I want to state at the very beginning that most angel investors I have worked with do not fall into the categories that follow. For the most part, they are honest, professional and dedicated to helping their portfolio companies thrive. To the extent that they have foibles, they are no better or worse than the rest of us. This article is about that small percentage of angel investors that can really give you heartburn and seriously damage your chances of building a successful business. Here are some of the types that you should avoid. Continue reading “Angel Investors to Avoid” »
Dr. Earl R. Smith II
Managing Partner, The Federal Circle
DrSmith@Dr-Smith.com
Dr-Smith.com
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
There is a tendency among entrepreneurs to chase money wherever they find it. The pressure to find the financial resources so necessary to build a business can be over-mastering. Most of the time the partnerships which form between founders and angel investors are productive but, in a few cases, I have seen it turn very destructive. Companies that should have realized success have been held back by investor partnerships that have severely limited their potential or, in some cases, doomed them to failure. Continue reading “Angel Investors – The Good, Bad and Very Ugly” »
Bad Behavior has blocked 1051 access attempts in the last 7 days.