OPTIONS

We work one of two ways:

Priority – If you want us to “Clear The Decks” put our heads down and get to work you'll honor us by paying a 1% fully earned, non-refundable commitment fee for our consulting services. The minimum fee is $2,500 and the maximum fee is $25,000 per project for six months of service. You may renew after that time.


When you hire us to work on a priority basis we thoroughly study your submission package to make sure that it complies with our recommended Road Map to Funding Success. Funding has always been about presentation. Those who present well are funded. Those who don't present well are not funded.


The key ingredients to funding success, in our experience, have been:

1.

A powerful Executive Summary of one to four pages.
2.

Bio's of key personnel.
3.

A detailed use of funds broken down monthly for the first year and quarterly thereafter.
4.

A 5-year proforma and written Exit Strategy.


Non-Priority – If you think that you've “nailed it” when preparing the four key ingredients to funding success, and you aren't in any hurry at all to fund and aren't quite ready to pay consultation fees then we'll take a look at your project when we can get to it. After we look at it we may need to send it back because you don't meet our requirements. (Priority Clients get major help from us in cleaning up their submission.) We'll return your calls and emails when we can: after all, priority clients come first.


We reserve the right to review each submission once, beyond that our consultation fee will be required. You had better complete the submission request correctly the first time or you better get familiar with our websites mentioned above. If you submit for free we can't spend a lot of time. It's not fair to us, our families, or our Priority Clients.


In our experience we can fund 1/3 of the files that cross our desks, 1/3 are DOA Dead on Arrival, and the final 1/3 are broken and need to go through some form of remediation which can take hours, days, weeks, months, or years.


We DO NOT GUARANTEE FUNDING. We work on a BEST EFFORTS BASIS.


With 33 years of Financial Services experience we may be uniquely qualified to serve you and those whom you choose to refer.

--
Venture Capital Intl., Thomas Duffy, CEO
Cell: 203.775.9999
Fax: 203.648.4942

# "The man who loves his job never works a day in his life." Confucius

# "All life is an experiment. The more experiments you make the better." Ralph Waldo Emerson

# The most important thing in communication is to hear what isn't being said

The purpose of Energy Restructure is to connect with the memories in your body that are keeping you stuck in emotion.. Even though you think you have let go, your body holds on in a physical way.
I use nine layers which are;
distraction, resistance, completion, withholding,love,nurturing,freedom,protection,truth.

Once you have identified and moved through this block you will be relieved on all levels.
All of a sudden your past will not haunt you and affect your life in a negative way.

Expect a miracle and you will get a miracle.
Retrain your thinking and actions take on a love for life.

for more info call me 860-350-4440

idea

it only takes one idea, one second in time, one friend, one dream, one leap of faith, to change everything, forever.

Just one!






http://tduffyllc.com

advances

People pay advances to Solicitors (without any guarantee of success)..you pay advance fees to Hospitals ( not knowing if the Surgery will be successful)...you pay advances for other services ..not knowing the outcome... yet when it comes to making a token payment for an ( over valued ) business plan then suddenly seekers of capital dole out sob stories...of how some broker took a ( measly) advance and never delivered....Thanks to Google making search free..Project promoters believe that all that the broker does is to search a VC/PE on Google and forward the Business plan...presto the Investor flies down with a cheque book.. So why should he be paid a fat fee at all...

The hours of high-level discussions spent by the Intermediary with the Project promoter carries zero value.. the days and weeks of search and interactions with various investors understanding their preferences/ expectations is treated as free..because the promoter never saw him spend the time..

Most of the people who swore that they will not pay upfront..either did not have the cash to start the engagement or their business plan was only good on paper..it could not pass muster with investors...

Admitted there are several phony promoters as well as intermediaries..just because some project promoters conned investors does not mean PE/VCs will put a blanket ban on funding..
so too it is necessary for project promoters to whet the credentials of the Intermediary .. I believe if they can't judge the capabilities of a Consultant (for the 25 fee) then the project they are promoting is at higher risk..as the investments are 98% more..

Project promoters tend to think they are infallible, they cannot be questioned and their valuation expectations cannot be challenged..Investors should toe their line and not see any 'risk' in the business.. the financial intermediary is expected to sell the highly inflated forecasts ( and the NPV of the Free Cash flows) presented in the Excel sheet. If he reasons then the fee is in jeopardy.

Just because financial intermediaries are small and cannot fight legal battles, project promoters shamelessly circumvent them once a probable lender is identified by the intermediary. Thereafter promoters will do every trick under the sun to deny the intermediary a fee ( making noise about the terms, etc yet going to the same investor through devious route).

This debate can go on endlessly. However serious Consultants don't take up Assignments without an upfront fee.What works for Deloitte or PWC also works for Smaller credible entities.

Promoters should know that they can't build businesses by getting free advice. If not upfront, they could pay a retainer for 3 months or adjust the upfront/ retainer on success. If the deal fails at least they would have learnt some lessons with regard to the weakness in their plans or the investor expectations.

SERVICES AVAILABLE

Primarily I'm a CFO to startups & growing companies - outsourced & part time. A typical company who is at the stage of needing me is either post funding and/or generating revenues, and I'm handling things such as investor relations, cash flow management, dashboard reporting, actuals vs. budget, playing bad cop on holding people accountable to the budget, growth strategy, constantly refining the financial model, etc.

Secondary, I truly enjoy helping out the true seed/idea/early stage startups who have the great idea in place, but need to get it down on paper, whether its a business plan, financial model, or both. The guys who don't know where to go next. That's what the original post was all about - looking to find any startups in need who want/need expert help to bring them to the next level and really light the fires to get things in motion.

While I used to be involved in raising capital, it's not something I actively do currently. For the few companies I CFO for, yes I do, but just as a stand alone project I don't. Reasons are many, mainly it is very time consuming, and very seldom does a hired gun/fund finder lure in investors. Investors want to talk to principles of the company, hence focusing on that endeavor when I'm onboard as the CFO and truly actively involved in growing the company, not just playing match maker.

That said, if you are a early/seed stage startup in need of a business plan/financials, let me know what you are about, if you have anything currently, and I'm happy to send along some samples and start the discussion. Just email me, tom@tuffyllc.com

sales

The Salesperson of The Future. Will They Truly Evolve and Be Different or Is it Just About Living It?


During a recent interview, I was asked, “What does the future hold for the work force, especially for salespeople? How will the salesperson of tomorrow change or be different to adapt to the times?”

Of course, my visceral reaction was to come up with something so transformational and insightful that it would reshape the landscape of professional selling and salesmanship. But after I paused and thought more about this question at a deeper level, I realized this may not be truly possible. After all, when it comes to selling, outside of the apparent changes in technology that continues to shape the Sales 2.0 evolution, what has changed over the years? Is there really a new definition for professional selling? If we were to look at the role, responsibility, skill set, behavior, attitude and overall disposition that makes a sales champion, is the anatomy of the top salesperson from 50 years ago to today and well into tomorrow really all that different?

While I believe there are some inherent changes we will see within the workforce when it comes to redefining the role of the traditional salesperson, the real difference will be evident in those companies who truly embrace and implement these changes and actually model this definition of sales mastery, as opposed to those who simply know about it but don’t do anything measurable to change. The economy over last two years has certainly done a wonderful job validating and exemplifying this ever widening gap. Consequently, this exposes the real opportunity for us and the timeless distinction between knowing it and doing it.

We are a society that is knowledge rich but execution scarce. While we are wealthy in wisdom and information, we are often lacking in seeing new ideas, strategies and activities through to completion and implementing the new behavior, thinking or technology to the point that it produces the desired change we’re looking for. After all, intention without action is still a diversionary tactic. (The real evolution will take place with the sales manager, who needs to become a sales coach to ensure these changes are, in fact made, but that’s a different blog and a different book ;-)

Regardless, I do have my view of tomorrow’s salesperson and this is the transformation I envision that salespeople must not only understand and embrace but put into practice so that it truly becomes part of their DNA.

The salesperson of tomorrow will continue to evolve beyond their traditional role and become more embedded into their customer’s business and the decisions that affect every facet of their operation.

The true sales professional will be relied upon as a valuable resource and a trusted, consultative adviser throughout the entire selling process; and beyond. This doesn’t mean focusing solely on relationship selling because those salespeople who are doing so are the ones who are struggling today. Great relationships don’t always equate to more sales. While additional time must be spent fostering stronger relationships with key clients, this isn’t about calling them just to ‘check in’ but having a more strategic set of timely questions that will help you better understand how the current economic climate has affected the way they do business and make purchasing decisions.

This will help us accurately connect to what the true meaning of value is to our customers, as opposed to what we generically assume it to be and as such, enable us to deliver on this at a much deeper, more significant level.

We need to take a closer and more holistic look at ourselves from the inside out while challenging our customers, the media and status quo. Therein lies the opportunity to elevate yourself and become the champion you know you can be.

how to run your million dollar business

The power of our thoughts and how it relates to what we can achieve is astounding. I am going to briefly touch on the things that helped me take a thought of owning a business to creating a multi-million dollar company. It all started off with a dream, a dream of leaving my job at the time to move into something exciting and new. As one never to sit still for very long, I was ready to see if I could make it in the business world. I had worked in many great companies and management roles, and knew people really well so I thought why the heck not!

What I didn’t know was that being an Entrepreneur and small business owner can be tough work! But I was going to find out about that very quickly! So here is the quick version…. Started with a bit of money, got investors, had a vision, had a solid system, build the company with mediocre employees, then learned how to have great employees and really build a team environment. We were the first in the areas we chose and filled a need, took action and advertised like crazy and tried new things. We showed the customer we cared, valued our staff and investors, and had TONS of ups and downs until we got it right! It took many years to build it up to what it was and the biggest hurdle and success was finally selling it and letting it all go.

Now this business after year 2 was making great money, and investors were happy, however there were times when things were tight and economics, unforeseen construction, renovations, staff turnover really caused downturns in the business. Trust me there were many struggles as well as many great opportunities for money to be made. The main problem for my partner and I was that it was something we no longer wanted. We realized that it was not our passion and that the industry had a stigma that would take many more years to change. The industry was being regulated and we were what seemed to always be proving that we were indeed a legitimate company helping people and really valued our integrity and ethics in the business. Our vision was to help people and make money however this was not the business that would complete that for us. So regardless of the financial gain we decided to sell and move on to do it again in what was our individual passions.

So what are the lessons learned that you as a small business owner can take away from all of this? Let’s look at it in a list form for easier learning;

1. I was a small business owner with BIG Thinking!

So let’s look at BIG thinking. I had a vision for what I thought a business should look like and I worked towards putting in place all the right things to make it happen. The right backing, finances, business plan because we were going for financing, and we looked at what the competition doing, who were they serving and where was the need. We had a vision of being a million dollar company right from the start and kept that vision strong in our minds.

2. I had a Solid Systems.

Then it was onto how would we run the company? How is it to be structured? Should it be a partnership or a corporation? What systems could we use that would ensure that we did not lose our shirts. We looked at what kind of system we could run under and developed a back end database program to track and take care of our clients. We made sure we had a solid policy manual (which was also developed further over the years) that would explain how we wanted the company ran for our employees so that they understood what we were asking of them. Then we ensured we gave solid, consistent training and that each office was a replica of the next. Call it a cookie cutter method if you will.

3. We took Smart, Deliberate, Quick Action when needed.

Being able to adapt to changing market and not wallow in problems is vital for an entrepreneur. Working smart, having good systems and taking deliberate action was an important factor to being able to keep up with the giants in the industry. We advertised and marketed like crazy and did some amazing things like huge billboards and pre-event marketing that had clients lined up at the doors on opening day.

4. We were able to solidify great relationships.

We created communication with the competition where we shared ideas and information within limits. We created additional product sources and had great relationships with who we were working with, and those relationships helped give us credibility in the industry. We kept the philosophy of win/win ever present in our minds.

5. We stopped trying to do it all on our own. Let go of Ego.

When we started to learn that in order to run a successful company we needed to trust, and let our employees do what they were best at doing, that is when things began to fall into place. We had to leave our egos at the door and understand that we had taught them, and that even though they needed us still, we had to loosen the strings in order for them to flourish and show how much they valued the company, and what they were doing. We used the skills of each employee and they grew better for it.

6. We showed we cared, and added value to our customers.

We encouraged our customers, showed them we cared, gave referral bonuses, talked with our customers, advertised and made them feel like they were not alone. We heard more stories about people’s lives then I will share here, but what it did was let people from all walks of life know that they were valued as people.

7. We understood the numbers.

We had done our business plan and knew what we needed to grow. We had a balanced framework with our product, our marketing and our financial operations. Whenever we lost touch with that again, it showed. Understanding where you stand, and what you need to achieve your end goal is important and really the key.

8. We were great problem solvers.

Being a great problem solver is important. Issues come up in any business and knowing what you will do and seeing your end result helps make it easier to predict how you will react and what steps you can take to rectify the situation.

9. We were always learning and watching our industry.

We knew what was changing in the industry, we focused on what was working, and we made sure if we could that we were the first. We showed value to our customers even though our price may have been different than others.

10. We had perseverance.

We stayed our course, and were committed to the business. Sometimes this was a difficult thing to do but in the end overall it was a success because we did have perseverance.

Now, did we always do the right thing? No absolutely not! But we did have the ability to see the mistakes and attempt to fix them. Did our employees always love us? No not always, but we did care about people and did our best to create a team environment where they felt included and valued and when we let that slip, it showed in performance from the team. The things we learned from this business have been incredible for future success and have allowed me to now help others in their journey for fulfillment in their lives. For more on this subject, you can find it in my 10 Complete Secrets

Mr B

There was a one hour interview on CNBC with Warren Buffet, the world’s second richest man who has donated $31 billion to charity.
Following are some very interesting aspects of his life:


1. He bought his first share at age 11 and he now regrets that he started too late! Things were very cheap that time… Encourage your children to invest.

2.He bought a small farm at age 14 with savings from delivering newspapers. One can buy many things with few savings. Encourage your children to start some kind of business.

3.He still lives in the same small 3-bedroom house in mid-town Omaha , that he bought after he got married 50 years ago. He says that he has everything he needs in that house. His house does not have a wall or a fence.

4. He drives his own car everywhere and does not have a driver or security people around him.You are what you are…

5. He never travels by private jet, although he owns the world's largest private jet company. Always think how you can accomplish things economically.

6. His company, Berkshire Hathaway, owns 63 companies. He writes only one letter each year to the CEOs of these companies, giving them goals for the year. He never holds meetings or calls them on a regular basis. Assign the right people to the right jobs.

7.He has given his CEO's only two rules: Rule number 1: do not lose any of your share holder's money. Rule number 2: Do not forget rule number 1. Set goals and make sure people focus on them.

8.He does not socialize with the high society crowd. His past time after he gets home is to make himself some pop corn and watch Television. Don't try to show off, just be your self and do what you enjoy doing.

9.Warren Buffet does not carry a cell phone, nor has a computer on his desk.

10.Bill Gates, the world's richest man met him for the first time only 5 years ago. Bill Gates did not think he had anything in common with Warren Buffet. So he had scheduled his meeting only for half hour. But when Gates met him, the meeting lasted for ten hours and Bill Gates became a devotee of Warren Buffet.

11.His advice to young people: "Stay away from credit cards & bank loans and invest in yourself and remember: Money doesn't create man but it is the man who created money. Live your life as simply as possible. Don't do what others say - listen to them, but do what you feel good doing. Don't follow brand names; just wear those things in which you feel comfortable. Don't waste your money on unnecessary things; rather just spend on those things you really need. After all, it's your life so why allow others to rule your life?"

"The HAPPIEST people DO NOT necessarily have the ‘BEST’ THINGS. They simply APPRECIATE the things they have”

Let us choose a simpler and smarter way to live

internet deal flow

The world clearly has changed. Long gone are the days of Rotary Club and Elks Lodge America, and of Tuesday afternoon tea. Replacing them is the brave new world of social and virtual networking, of Linked-In, of Facebook, and of Twitter. And from a standpoint of access to and diligence of great deal flow, this is an extremely good thing.

Let's compare how deals can be and are identified and diligenced today to how it was done 20 years ago. Back in the good old 20th century, opportunity flow was limited to that which could be introduced to you directly by people you knew, usually in your local community or in your immediate circle of family, friends, and business colleagues. Oh what a simpler, more innocent time that was! But it was also a parochial and limited one.

There was first the limit of geography and introduction. If you were far from the major entrepreneurial and finance centers (New York, Chicago, San Francisco, Boston, and Los Angeles), the likelihood of crossing paths with the "special deals" was very, very limited. Back then, opportunity flow really was limited to the "old boys club," and what you knew was far less important than who you knew.

Compare that to today. Sites such as Linked-In, Facebook, BizBuySell, RaiseCapital.com, The Funded, The Private Equity Exchange, Second Market and even Twitter are treasure troves of startup, small business, and emerging technology deals and ideas. This is to say nothing of the World Wide Web itself, where all of the serious entrepreneurs and private companies (a number that runs into the millions) have websites that explain, in various degrees of succinctness, what they do, where, why they do it, and how they make money. And if they can't, with a click of a button, you move on.

And there was enormous information friction 20 years ago. Getting quality information back then was time-consuming, expensive, and prone to omission errors. There were no websites, where you could quickly get that critical feel for the "realness" of a business' growth prospects. There was no ability to "Google" someone and to find out about that bribery conviction 10 years ago – conveniently omitted from conversation and the business plan. There was no Linked-In and Facebook to identify the various "degrees of connection" that confirm resume and background representations.

Now to this you may say, “But heck in a Norman Rockwell America this stuff wasn't needed,” because, back then, you did business like men: face-to-face with guys you knew from the club.

To this I say two words: Bernie Madoff. Mr. Ponzi himself could never have gotten away with what he did if he traveled amongst the modern "technocrati." His M.O. of secrecy and opaqueness would have screamed suspicion immediately to any one even basically versed in online networking. This brave new world is one that if you have nothing to hide, then you ain’t opaque. And it is a better world for it.

Finally, you may say, “Well Jay, if this new world of ours is so abundant and so filled to the brim with such incredible money-making deals, why are we all getting killed in the markets? Couldn't we all kind of go for some of those 1980's-esque returns about now? If this new world of ours is so great, why is everything so bad?”

To this, I refer you to Nassim Nicholas Taleb, author of the paradigm-changing treatise, "The Black Swan." At the risk of over-simplyifying Taleb's big idea, the good old days were a world of "Mediocristan," or in the inimitable words of Garrison Keiller, one where “all of the children were above average.” There were business successes and failures for sure, but they were of more of a gradual and tepid form. The 21st century, in contrast, is a world of Extremistan - characterized at the macro level by outrageous bubbles and busts, and at the micro level by a quite small number of enterprises and business models that are responsible for the significant majority of an investment class's return.

Our contention is that, as we move into the 2nd decade of the 21st century, more and more investors will both be able, and prefer, to hunt for these future supernovae via online social networking and deal exchanges and the Internet itself. From here, most but not all of the traditional deal diligence rules apply. In future blog posts, we will explore which ones do, which ones don't, and how to assess and price private company deals in the current environment.

market research

One of the things I learned back then was to be wary of
certain research results. Why? Because I learned that it's
pretty easy to purposely skew research questions to get the
results you want.

Which is why a lot of new products fail, even though the
research said they should have succeeded.

While there are no certainties when conducting or reviewing
marketing research, one thing is clear. When data from
multiple sources continue to say the same thing, than that
data is typically true.

Such is the case when it comes to Internet Marketing.

Countless research studies have proven beyond a doubt that
virtually every company can profit from improving their
online presence. Consider these recent statistics from
eMarketer and Cornell University:

* 87% of all Internet users utilize search engines to find
information on goods and services online.

* 63% of all Internet users have used the Internet
specifically to research a product or service before buying
it.

* 49.9% of companies marketing their businesses online
realize ROIs exceeding 100%. (that means they make over $2
for every dollar they invest online!)

* 37.1% of B2C and 37.9% of B2B companies who have tried,
have successfully marketed their businesses using Facebook.

The research is pretty clear. Getting your company found in
the appropriate places online can skyrocket your growth and
profits.

But, like with anything else, internet marketing is a bit
complex. And, more often than not, business owners don't
realize success right away.

It's sort of like riding a bicycle. Once you know how to do
it and get the hang of it, it's smooth sailing. But, the
first few times, particularly if you don't have anyone
watching out for you, you'll fall down.

In fact, I've fallen down quite a few times. Over the past
ten years, I have invested over $5 million of my own money
into internet marketing. But, while I've gotten knocked down
a few times, I've also enjoyed a ton of success. And I've
learned a whole bunch of valuable lessons.

And, right now, I'm putting together the final touches on
my internet marketing course so I can teach you these
lessons.

While I'd love for you to buy the course, even if you don't
buy it, I feel obliged to get at least some of this
extremely valuable information in your hands. That way you
can start using internet marketing techniques to grow your
revenues and profits (and not get hammered by a competitor
who is a savvier online marketer).

So stay tuned. Over the next couple of weeks, I will be
sending you a few emails with some of the information from
my upcoming internet marketing course.


To Your Success,

points

There are however a few points that you have overlooked. Although it is definitely true that lenders have been lending on property for as long as anyone can remember, their attitude towards loaning money follows the market as it travels up and down in fairly regular cycles which are almost predictable except for the depth of the necessary and automatic corrections. At this time, we are experiencing, as you stated, the near lowest part of the most recent cycle in which values will reach the bottom of the curve (hopefully within the next 6 to 12 months) at which point it becomes the ultimate buyers market and everything is uphill from there. The problem is that this current state of affairs only adds, in the minds of all lenders, more risk to the equation. Therefore, it becomes necessary to add more security to the loan scenario to counterbalance the increased risk. As I stated before, any asset or property value becomes secondary collateral as the lender will consider it only at its lowest predictable or "fire sale" pricing. Something worth $10M today will serve as $2M in collateral and subtract from that the costs and time involved in foreclosing on the property upon borrower default. Its not worth their effort to take it on and add it to the books when they expect your project to fail anyway. This may change but not for a long time and for that matter it may never adjust back to the way it was in the past due to the beating most lenders took during the recent downslide. Live and learn.

Angels, private equity and venture capital aside, it is preferable for borrowers to deal with banks and financial institutions that are licensed and regulated. This also lowers the risk to the borrower by eliminating the need of taking on a contracted "partner" that will in most cases, eventually own part or most of your company. The stakes are high for the borrower when utilizing this type of lender and we all know it. Granted they have their function and are appealing to those who find it necessary to use their services, but if most borrowers had a choice, they would go to a bank or financial institution for obvious reasons.

When I stated that the borrower was required to place 20% down on their project, I did not mean that they would be haphazardly handing over to some unknown entity or throwing it into some bottomless void watching as it floated down into the darkness. All borrowers must exercise rational thought and caution when and if they decide to put up the required depository funds. In my humble opinion, the deposit needs to be secured by something of equal or greater value and must include an ironclad contract which ensures its return within a predetermined time period. Also, if it's my investors funds that I'm using as a deposit for my project, not only do I need the above, but I would need the deposit to generate, at the very least, what it's costing me to use the deposit funds from my investors. If it costs me 10% annually, the deposit would ideally yield the 10% plus another 5% for inflationary adjustment.

Lets review:

1. The borrower needs a licensed and regulated bank or financial institution as a lender in order to retain 100% ownership in their project with no outside interference in the decision making process.
2. The borrower needs to secure their 20% deposit by exchanging it for something of equal or greater value with an annual yield of a minimum of 15% to satisfy their investors cost of funds and an inflationary adjustment.
3. The borrower needs an experienced, reputable, licensed law firm to handle the transaction in a professional and expeditial manner and to work hand in hand with the borrowers law firm to result in a successful conclusion.
4. The borrower needs a 10 year term at 5% annual interest (I thought I would throw that in to make it seem more difficult)

borrowers

In general, there are two types of borrowers. The first type has a project and a dream, the second type has a project and a dream along with the experience and capability to pull it off. The second type is also well prepared, heavily documented, fully staffed, and ready to move forward.

The second type obviously has the best chance at securing financing because they already have what they need and know what they want. Does this mean that they will attain their financing goal? Not necessarily because there are many more variables to consider. The most important of these variables is the question of "what are they bringing to the table". Just because you have all the qualities of the second type of borrower means nothing without the proper collateral.

Collateral takes many shapes and forms. In days past, it would have been acceptable to own assets such as land and buildings which, in the best of cases, were owned outright or had a high percentage of equity which could be pledged as collateral. It would also have been acceptable to have 20% or 30% of "skin in the game" mostly in the form of architectural plans and an entitled piece of property that is "shovel ready" to build the project upon. Unfortunately, these types of assets in todays market are treated by lenders on a secondary basis because (1) their values have done nothing but fall for the last18 to 24 months and (2) lenders are incapable of predicting the future and think on a worse case scenario where they will continue to fall in value.

That leaves us with the only other form of collateral that has the capability to be used in any market. Cash, or a financial instrument with almost the same liquidity as cash. Without this type of collateral, lenders cannot and will not take the risk to loan to the project and as we all know, risk mitigation is inherently built in to any lending situation.

So what it boils down to in the end is that those who have the liquidity necessary to mitigate the risk that the lender is taking, by loaning you money, are the entities that will secure the financing to build their projects. Notice I used the word "secure" the financing. Without liquidity you are unable to table the collateral required to close the deal.

Cash (or liquidity) is king. Always has been and always will be. Unless you have at least 20% of your total project costs readily available, there's a 99% chance that you won't find your financing anywhere and you'll end up beating your head into brick wall until it knocks you out.

If (and thats a big IF) you do have the 20% liquidity required by most good lenders, the question becomes, how do you ensure that it doesn't disappear into either the project, or in most cases into the lenders pockets, because most of the time it comes from investors who were nice enough to find it within their hearts (and wallets) to back your project. Wouldn't it be an ideal situation to be able to provide your investors (or yourself, if its your money) with a healthy return on their investment and at the same time guarantee that their dollars were safe and sound and will be returned to them at a certain time period in the near future.

This is possible under the right circumstances and available to those who are the second type of borrower mentioned above (and most importantly without upfront costs of any kind). All you need to do is find it. Open your eyes.

P

answers

THE KEYS TO THE GOLD MINE
Question
Have you wondered how some people come up with that winning idea--that idea that opens
the door to the gold mine? Literally, customers are falling all over themselves to buy
your product or service. In fact, you become a legend in your own time. Is it luck,
timing, the stars, or can it be systematized?
Answer
Your idea is the starting point. Most people have ideas--they're like belly buttons, everyone
has one. But rarely does the initial idea walk you into the gold mine.

Here, we will discuss how you find that winning product, service, idea. My company, Ascend,
practiced the lessons in "The Keys to the Gold Mine." In less that 10 years, Ascend is an
S&P 500 company, it has over 4,000 employees and will do over 1.5 billion in sales with a
market cap of over 12 billion. These lessons are worth learning.

Where do you find the ideas? The absolute best are not dreamt up or forced out. They are
the things that you have lived with, experienced, and know inside and out. So, let's say
you have one of these experiences and are sure it will bring you fame and fortune. Where
do you start? Get out and talk to customers; bring with you a simple presentation. See
How to Build a Successful Business Presentation.

How do you know which customers to talk to? The rule is simple, "Willie Sutton robbed
banks because that was where the money was." You must do the same. Talk with the accounts
that have money and the most to gain by your ingenious idea. Then ask, do they like it?
What do they like about it? Be detailed. Compare notes on all accounts. Is it the same for
all of them? There's a theme emerging here. Remember, ideas are nothing until you test
them. But test them on your nickel, don't expect investors to. One last note on
ideas--look for value. It must have a true value proposition for customers. Meaning, the
customer's bottom line is impacted.

Here is an example from one of my startups, Silicon Spice, an Entrepreneur America graduate
currently funded by NEA, Kleiner Perkins, Worldview, and CMEA. Their product is a new chip,
suffice to say of revolutionary character. They are aiming the chip at networking companies
such as Ascend, Cisco,and others. The value proposition is that:

It replaces a great number of other chips (dollars - thus reducing the cost per port for the
customers). It offers the ability to add new software (value - running on the chip). It
is a significant improvement, resulting in much lower cost per port, smaller space and
power and increased functionality. That is a value proposition.

How do you find ideas like these? I have several techniques:

The technology inventory.
The sunflower model.
The customer inventory.
The value proposition.

The first technique is what I call The Technology Inventory. For example, after taking
inventory in several areas of Silicon Spice's technology, we found it was the chip's
ability to do parallel processing and to reconfigure--this was the key. This led the
co-founders and me to look for a problem in my networking, where the chip might replace
multiple chips. Such a problem existed in Ascend and others such as Cisco. Both companies
build boxes that receive many modem calls (one modem = one chip). Walla let the chip handle
multiple modems plus more. By looking carefully and taking inventory, the idea was refined.

Another example is a company I work with called IDI in Ithaca, NY. They have ice detection,
removal, and shape shifting fluid technology. We must inventory all their technology, then
figure out which ones we can build a sunflower around.

Recall what a sunflower looks like. It has a distinct center--that is your core technology
or service. Don't doubt the components that are unique and differentiated or you won't grow
much of a company.

The petals are the product market that you can leverage the center into. Let's use Honda as
an example. What is Honda? Is it a car company? Is it a lawnmower company? Maybe they sell
motorcycles? It is none of these things. It's an engine company. They produce small, medium,
and large engines, embedding them into products and markets where engines are a major part
of the product. Find your engine. Build a sunflower.

Let me illustrate another example from my company, Ascend. The co-founders and myself
started Ascend with the idea and the funding to do an ISDN concentrator. ISDN being a new
digital telephone service, we reasoned that customers would need a box to connect their
computers and offices to this new service. There was one small problem. The phone companies
decided to pull back on their deployment of the service leaving us with a box and no lines
to connect to. This also left us with some very unhappy and puzzled investors.

We regrouped--grasped at another idea called dynamic bandwidth that Jay, Speck, and Jeanette,
the co-founders, discovered. The Board gave Ascend 3 months to verify the latest idea. With
a simple presentation, we tested the idea on customers. We found a customer in Compression
Labs that needed to have high-speed bandwidth on a dynamic, dialed basis. CLI was selling
videoconferencing to corporations, yet those corporations had to lease very expensive
lines for the communications. We offered the possibility that the same bandwidth could be
delivered by aggregating slower, cheaper lines. CLI was interested. We asked for proof of
interest. CLI gave us a conditional purchase order and we went on to build the high-speed
access product.

Over the next few years we built a reasonable business--16 million in sales. Why wasn't I
happy? Remember, a company needs to build a significant business to gain investors. We had
the investors; 19 million in their cash and a 16 million dollar business that was not going
to yield the expected 7-10 times their money. We had to reinvent ourselves somehow.

That is when I read an article published in the Harvard Business Review about the core
competencies. I came up with my infamous Sunflower and we decided that our engine was
"bandwidth on demand." Ascend would deliver products to whatever market required high-speed
dialed bandwidth.

We began asking ourselves which markets needed dialed bandwidth. We hypothesized that the I
nternet, telecommuting, etc. were possible places for our core technology. We then tested
this theory by talking with the Internet Service Providers--all 50-75 of them. We found
that the ISP had a serious problem in his backroom. The ISP and the Internet were growing
over 100% every 6 months, so the ISP needed to get new modems, communication boxes, and
their lines at a startling rate. Their backroom room looked like spaghetti--a mess of boxes
and lines. They asked if we could fix this. We could. They loved it. The rest is history.

When you have done the Sunflower, what's next? Inventory your customers. Do you really
know what they are doing with your products? LIFE magazine has a cute, possibly true story.
A time back, they thought they had a run on LIFE magazines in Japan. They assumed the next
step was to start a branch office in Japan, but they didn't know what was causing the
upswing. Turns out, the magazines were being used for fertilizer and shielding plants.
Whoops!

Active Education is an example from my EA companies. When they showed up at the ranch they
were doing technical books under hire to clients. One such client was Microsoft. They were
outsourcing their employee training to the local community colleges who were using these
books. My hypothesis was that other corporations might also be outsourcing the local
schools and maybe we should be approaching the community colleges and leveraging the
relationship started by Microsoft.

A final example is a company called Activeworlds. When they arrived at the ranch, they had
3D software--software that lets people build 3D worlds, some 3,000 of them. Each user paid
$20 a year. I asked them to inventory their corporate users. It turns out they had Boeing
quite by accident since they had no sales force. What was Boeing doing with their stuff?
Who knows? Big mistake. "Get your asses out there," I instructed. Boeing, it turns out,
was modeling their shop floor and training people with Activeworlds software. Now, A
ctiveworlds is a part of Boeing, in fact, is their star. More importantly, it is likely
there are other companies that have training needs in a variety of areas. So instead of
$20 per year, we can do deals on the order of $250,000 per year.

The last technique is what I call seeking and finding a major value proposition.
Activeworlds is a good example. The first value proposition allowed users to meander
through a chat room on steroids for a mere $20 a year vs. Boeing using it to solve
training issues.

I hope you now have an idea on how to hunt for your gold mine. Create inventories of
customers and technology, build the sunflower, and find the value proposition.

systems

The system IS the solution. Average people in a great system will outperform great people in an average (or most often, a missing) system.

Most Leading Finance Organizations have Engagement Fees

Company X, a division of Company Y, provides project funding and wealth optimization for its clients on a worldwide basis with its own funds and/or in conjunction with FPs (financing partners). Engagement Fees appear to be an issue time to time from misguided inquiries. Prospective applicants/clients who are adamant by making a statement that they will not pay “any advance / upfront fees” are divulging: 1) they have spurious projects, or 2) they have never been funded before, and/or 3) they do not understand anything about the funding process. In some cases, applicants who are intermediaries may be unreliable and ignorant on the funding process, while only attempting to acquire any offer from us to 'sell' our terms to their principals with having no true binding powers.

An “engagement fee” is a predetermined amount paid to a service provider up-front, prior to commencing the investigation and completion. Its primary purpose is to create an atmosphere of mutual commitment between a service provider and the client, which covers some pre-contractual costs while maintaining a transparent refund policy. The aim is to provide a highly professional success-driven service; therefore, relationships are chosen carefully and requests are not accepted to which do not have a significant chance of completion.

All of the following steps, which have proceeded with projects we have funded thus far, will involve the client in advance payment as no lender will take on pre-contractual costs when the result of the checks could result in the funding not taking place because the client has failed them. To clarify, no one, not us, nor any of our FPs will assign 100M EUR, 250M EUR, or whatever amount to a project owner without taking the following steps:-
a) via external experts, KYC (know your customer) checking the bona fides of the project owner, management team; active, past and pending court judgments; management accounts and business plan on behalf of our funds managers, and/ or the relevant financing partner/s;
b) via external specialists, checking the integrity of the project;
c) checking the integrity of the collateral offered to cover the funds. In all cases, there will need to be assessment by experts so as to cater for risk as such assets will, in most cases, be already encumbered. The collateral may also need to be title insured;
d) personal meetings and site visits with us, and/or one, or more of our FPs to discuss and recommend the client's project, liaison with the client and/or the financing partner/s for the proposal of the client's project;
e) the detailed development of the client's project presentation to our fund managers' requirements and to the requirements of the relevant FPs, we will negotiate on behalf of the client, the funding conditions and timing where funding is to be provided by one, or more of our FPs;
f) we and/or an FP may want an SPV to be set up the funds release management and also, alternatively to have one of its members, or an external specialist sit on the board of the project owner for the purpose of monitoring the progress of the project;

Our business model was developed comparatively to the leading finance organizations. We are: faster, interface more directly with clients, offer guarantees, fund worthy, professional, do not hog-tie the clients to us, affirm an apparent refund policy, dedicated toward success from the client's perspective, and look to minimize all engagement risks for the parties involved. If you’re one of those elite who appreciate our business model, contact me to proceed with correspondence.

VC INFO

This is part of my Series on Venture Capital.

If you’re in the mood for a really enjoyable film I recommend you see Guy Ritchie's Sherlock Holmes. In it he uses the latest movie-making technologies to literally bring-to-life 19th century London in all its dark immensity and brooding menace- from the elegant halls of parliament to the ornate rooms of masonic temples to the labyrinthine sewers beneath the city. The sets and staging in and of themselves are a masterpiece and are simply breathtaking. I think the production designer should be nominated for yet another Academy Award.

For the Sherlock Holmes aficionados out there, I’ll also venture to say that Robert J. Downey, Jr. is terrific in this latest incarnation of the great sleuth. He brings an athleticism and playfulness to the role that is a fresh twist to any cinematic adaptation I have seen. I have an inkling that his performance would bring a smile to the face of the venerable Basil Rathbone and perhaps even to that of the great Holmesian master, Jeremy Brett himself, were they still living.

I too came to this film with a sensibility that I did not have when I first encountered Holmes as a young boy reading Conan Doyle. I was of course neither an entrepreneur or an early-stage investor back then. Not surprisingly, this time, soon after leaving the theater something I had never considered before really hit me. I was struck by the realization that Sherlock would have made an amazing venture capitalist! "What a perfectly silly notion my dear Watson!", he would no doubt have replied. But I would have to insist and say that VC's and Angel Investors young and old would do well to emulate some of Sherlock’s best qualities. Here they are as I see them:

1) Complete and Utter Attention to his Clients:

When he meets with someone, his total absorption in their presence is legendary. (He would, for example, never dare distractedly glance through his mail when receiving a guest- as many a VC are criticized for doing via their blackberrys). He also is incredibly respectful and courteous to his clients, always responding to their telegrams promptly.

2) Immensely Perceptive and Observant:

LP’s looking for capital efficient managers take heed! Forget about your GP’s spending money to perform diligence on entrepreneurs. With Sherlock as the Managing Director, he can tell you a person’s entire story and background after the first meeting! He takes the meaning of due diligence to another level entirely.

3) He’s a World-Travelled, Experienced Entrepreneur Himself:

Worried (as Hoegaerden is) about “sub-prime VC’s”? Holmes is no newly-minted, blue-blazered-stiff-of-an-MBA just off the VC conveyor belt with no life-experience. He’s traveled the world, has enormous wisdom and runs the 19th century equivalent of a garage start-up consultancy with Dr. Watson.

4) Massive Intellectual Curiosity, Great Erudition:

Here’s a VC who doesn’t rest on his laurels and past accomplishments. He is constantly learning, reading, studying and staying abreast of new trends, the news, the latest technologies. He is the first Western martial artist, a naturalist, an amateur chemist par-excellence and an early adopter of the newest technologies and techniques available.

5) Loves the Big Idea, Huge Risk-Taker & Admires Disruption:

Here’s a true innovator not content with following the herd and investing in the latest incremental fad. He himself is disrupting the law enforcement industry with his own super-lean startup! The bungling bureaucracy of Scotland Yard and Inspector Lestrade are no match for Holmes’ home-grown operation with a staff of two, (three if you include his landlady, Mrs. Hudson). He’s confident and capable enough to trust his own vision and therefore is ready to tackle the biggest, toughest, most elusive problems in the marketplace!

6) Great Mentor, Coach and Board Member:

He leads by example, has intelligently advised innumerable clients and has helped Watson hone his now considerable skills as a crime-stopper. He anticipates events, predicts how people will react and has a keen sense of danger. Such a mentor could help any entrepreneur with the sales, marketing and hiring process, not to mention with the design of an effective strategic plan. He would make a great Board Member.

7) Great Ear for the Customer:

When it comes to understanding the views of the man on the street, no one is better than Holmes. He’s as comfortable in the elegant drawing rooms of 221B Baker Street as he is on the vilest lanes of London, has roughed it in disguise many a time and is known to have eyes and ears throughout the city. He has no allegiance to class, no patience for pomposity and judges a person on their individual merits.

8) Driven with Enormous Energy:

Here’s a guy who loves his job, pulls all-nighters regularly and will take almost any meeting. He’s relentless and ultra-determined when trying to solve a problem and this is infectious to the entrepreneurs he funds and advises.

9) High Standards & Innate Sense of What is Right:

Holmes is always very exacting of Watson and those around him, but never more than he is on himself. He takes on each engagement with an enormous sense of purpose and sense of what is inherently right. As many have said, he has his own sense of justice that is at times distinct from the rather blunt and un-nuanced version often displayed by his lemming-like colleagues at Scotland Yard. A loyal teammate with an unfailing moral compass, he is an enormous asset to the companies in which he invests.

10) Sense of Humor:
Lastly, as Robert Downey Jr. exemplifies so well in the film, Sherlock has a terrific sense of fun and playfulness and mischief- rarely taking himself too seriously. It is always disarming and endears him to Watson and many of his clients. He is respectful and yet irreverent all at once.

help your business

You may not know it, but you could be causing the demise of your business. Could it be that it’s time to get focused, take action, be accountable and produce much better results? Let’s look at the business killers that could be holding your business down and then actions to maintain the right focus:

1. Focusing on Fires
Most business owners are focused on whatever business fires or emergencies come at them in a given day.
Action: Focus on creating a marketing plan and then execute your action plan.

2. Focusing on Bling
In business, bling is the shiny new marketing toy that everyone else seems to be using.
Action: Focus on doing more of what works. Test and monitor all current or new marketing strategies.

3. Focusing on a Long “To Do” List
Honestly, you can only “do” so much. Being busy does not equate to being productive.
Action: Focus on 5-9 strategies that will grow your business this year.

4. Focusing on Your Weaknesses
When you focus on your weaknesses, you spend your time being a frustrated learner and learning should be fun!
Action: Focus on your strengths and pay someone “to do” the work where you are weak.

5. Focusing on Control
It is expensive to continually learn new tasks and then do them. You waste time, money and make more mistakes when you do it all by yourself.
Action: Focus on delegating and taking care of you by creating a team of employees and consultants for your business.

6. Focusing on the Mass Market
When you market to everyone, you make no one special, and everyone wants to feel special.
Action: Focus on creating an ideal client profile and market to prospects who value what you offer and will pay you the most money in the least amount of time.

7. Focusing on Today Alone
Usually owners make decisions based solely on today and don’t think about how their decision will affect the future.
Action: Focus on decisions based on today, forecast five years from now, and develop a plan on how you will exit your business.

8. Focusing on Features
No one will buy from you if you stress the features or services that your company provides.
Action: Focus on the benefits and results your prospects will receive when they work with you.

9. Focusing on Cheap Prices
Have you noticed that cheap prices bring you clients who nickel and dime you (and waste so much of your time)?
Action: Focus on pricing your services “just right” based on the highest dollar amount your ideal clients will pay for them.

10. Focusing on What You’ve Been Doing
If what you’ve been doing isn’t getting you the results you desire, then your business needs some tweaking or even a reinvention.
Action: Focus on taking a fresh look at what you are doing, and if it is not working, get rid of it!

With special thanks to all my clients who reminded me of the basic changes they have made to their businesses that have helped them substantially grow their businesses and increase their profits.

WANT TO USE THIS ARTICLE IN YOUR E-ZINE, BLOG, OR WEB SITE? If you want me to change anything before you print it, you must ask for permission. And you are welcome to use it anytime in its entirety, with the following author/copyright information:

©2009 Maria Marsala,