This is a “motto“ that i created for a client company. That company was ultimately sold for $3 billion dollars.
The point is – that if a company is going to excel and reach its ultimate potential, it must be equipped to reach the finish line.
Over the last 27 years, I have seen a large number of notable successes among my client companies and I have also witnessed a fair number of failures.
Strangely enough, the failures were rarely attributable to bad product, inadequate technology, or poor concepts. many, in fact had great technologies and wonderful strategies.
On a number of occasions, client companies did fail because of poor management. Great technology or the best of ideas in the hands of inadequate management will fail.
Most often, however, companies failed because they ran out of money. Capital fuels the growth of young companies and when you are out of capital, you are out of luck.
Young companies, when raising capital concern themselves with issues like:
Cost of raising capital…commissions or fees that they pay
- various approaches and avenues to raising capital. They debate private placements, IPOs, and reverse mergers.
While these are legitimate questions and areas of concern, let me be clear, the overriding mandate for a young emerging company is to have adequate capital to fully fund it’s business plan, or nothing else matters.
The dream of most entrepreneurs, founders, and engineers is to bring their product or technology to market, create measurable revenues, and then do an IPO at a very big price.
On paper and conceptually, this looks really good, but in the world that I live and work in, there is significant competition for investor dollars, and in funding companies, we have to necessarily raise money in the avenues that are available to us. And have a flexibility of strategies.
It is much like a football game. Some games are just messy with fumbles and interceptions, but in the final analysis, winning is what counts. When they put a “w“ by your team, they rarely ask how you won.
Raising capital is a science with four component parts:
- You must tell your story. Raising capital is a competitive exercise. No one is going to just find you.
- You must tell your corporate story professionally and articulately. Avoid being verbose.
- You must tell your story to the right audience, persons and groups who actually have the ability to invest in your vision.
- You must tell your story often, and then it becomes a function of numbers. In tough financing markets, it must be told much more often in order for the odds to work in your favor.
Over the last 27 years, I have consulted and worked with well over 75 young emerging companies, many of whom have themselves achieved success and a high profile in their respective industries. It is my experience and studied opinion that if they have failed in their quest for capital, it is because they have failed in one of these four areas.
The other key to success is finding a consultant who can assist a company in conceptualizing and fine tuning its message, creating a perception of that company in the investment community, assembling the right audiences for the company’s story to be told, and then aggressively addressing a large number of potential investors.
Equally important is designing a specific strategy and then sticking to it. A reasonably good plan that is methodically implemented is far superior to a brilliant plan that you are always changing.
In the end, it is a matter of execution.