Angel Network's Latest Posts
Posted by admin on October 31st, 2008 — in Angel Capital Education, Entrepreneurs
This is possibly one of the most important decisions when starting a business. Not all entities are suited for raising substantial amounts of capital or flexible enough to grow with your changing needs. Most business entities that need to raise capital will organize either as a corporation or limited liability company (LLC) because of the financing options available. With a little forethought and the ability to understand the advantages and disadvantages of the different types of entities, your business will have the capability to achieve your goals.
BASIC QUESTIONS TO ASK YOURSELF
How easy is it to set up and operate the entity?
What kind of capital can I raise in the entity?
What are the tax advantages and disadvantages of the entity?
Who is liable for the business debts and obi ligations?
What happens if I die or become disabled?
Sole Proprietorship
This is the entity to use if you are one person doing business in your own name (or under a fictitious name) and paying the applicable taxes on your own personal income tax return. In this type of entity you have unlimited personal liability for the debts and obligations of the business and you can NOT sell equity to fund your operations or expand the business. As a sole proprietor, you can use debt to finance your operations but you will be personally liable for the repayment.
Advantages:
Easy to set up
No organizational filings with the state (unless you do a fictitious business name)
No initial or continuing annual reports to file
No separate income tax forms to file – Just a schedule C with your 1040 form
Disadvantages:
Personally liable for all debt and obligations of the business
No stock structure – Can NOT sell stock to raise capital
Can only incur debt through loans or promissory notes
Partnership
There are two types of partnerships – General Partnership and Limited Partnership. One of the advantages these entities have is that they pay no tax at the partnership level. Instead, all profits and losses are passed through to the partners according to their percentage of ownership (in the absence of a special allocation), even if the profits remain in the business to fund continuing operation or expansion. Beyond this basic principle, partnership tax law is a complex subject to understand and is fraught with traps for the unwary. Make certain to consult with a tax professional that is familiar with partnership taxation.
General Partnership
A General partnership involves two or more people carrying on a business together, sharing the profits and losses. Unless limited by the partnership agreement, each partner has full managerial control over the partnership and unlimited personal liability for the debts and obligations of the partnership.
Advantages
Partners can combine their expertise and assets for a common goal. Most states do not usually require general partnerships to file organizational documents, unless there is a fictitious name filing required. The following states do require the filing of a “Statement of Partnership Authority” or similar for general partnerships.
California
Delaware
District of Columbia
Hawaii
Idaho
Kansas
Oklahoma
South Dakota
Virginia
In addition, a handful of states require the filing of initial and continuing annual reports. General partnerships have higher maintenance costs than a sole proprietorship because they must track assets and liabilities as well as income and expenses, but their operational costs are still lower than a corporation because they are not required to have the same governance formalities. In addition, the business can continue after the disability or death of a partner if there are more than two partners. Partnerships file their federal income tax returns on Form 1065. State income tax filings may also be required, depending on the state in which the partnership is domiciled.
Disadvantages
This is a potentially dangerous form of business entity because each partner is jointly and severally liable (meaning together and separately liable) for the debts of the partnership and the acts of the other partners within the scope of the business. Therefore, if you partner breaches a contract or signs a million dollar credit line in the name of the partnership, you can be personally liable. All parties share control and the death of partner may result in the liquidation of the partnership. It is often hard to get rid of a disgruntled partner.
A carefully drafted partnership agreement prepared by an attorney can mitigate the disadvantages inherent in partnerships.
Limited partnership
A limited partnership has characteristics similar to both a corporation and a partnership. The general partners have control and unlimited personal liability, but the limited partners, who put up money, have their liability limited to the amount of their capital contribution to the partnership (like corporate stock). A limited partnership must have at least one general partner and one or more limited partners.
Advantages
A limited partnership usually only needs to file a one page document called a Certificate of Limited Partnership, with the state upon formation and pay a fee. In a handful of states, however, the limited partnership is also required to file and initial report and continuing annual reports with the state to update the contact information for the partnership, resident agent, and general partners and in some cases the limited partners. Capital can be contributed by the limited partners who have no control over the business and no liability for its debts or obligations.
A limited partnership may define the term of its existence in its partnership agreement. In addition, the business can continue to operate after the death or disability of a general partner if appropriate survival language is included in the limited partnership agreement.
Just like general partnerships, limited partnerships have higher maintenance costs than a sole proprietorship because they must track assets and liabilities as well as income and expenses. They have lower maintenance costs than a corporation because they are generally not required to pay taxes (although they must file tax returns on Form 1065) and are not required to hold meetings or keep minutes like a corporation.
Disadvantages
Like a general partnership, your attorney should prepare a limited partnership agreement to set for the ownership and sharing arrangements of the partners. In a limited partnership, the general partner is personally responsible for partnership debts and for the business-related acts of other general partners.
Limited partners give up most of their control over the business in exchange for limited liability. When limited partners take an active role in the running of the business, they jeopardize their protection from liability and can be held liable as a general partner. Assuming limited partners take no part in management, they enjoy limited liability as in a corporation. Like general partnerships, limited partnerships are subject ot the same complex tax rules, so consult with a tax professional when forming your limited partnership.
In recent years, the limited liability company has overtaken the limited partnership as the tax-advantaged vehicle of choice, because everyone involved has limited liability and investors can participate in the decisions of the company.
Next time we will explore Corporations, and Limited Liability Companies
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Posted by admin on October 28th, 2008 — in Uncategorized
Recent email from GoBIG
| Hi, it’s Wil Schroter, the Founder of Go BIG.
I was speaking with the folks at Mark Burnett Productions yesterday about a new show that is about to air called Shark Tank. The show, which will air on ABC, allows entrepreneurs to pitch to a group of five investors (the “sharks”) on national television. The sharks may or may not invest, but by default you get to get the word out about your opportunity to the entire country.
If you’re interested, reply below to Charisse at Mark Burnett. The official call is pasted below:
New TV Pilot produced by Mark Burnett for Major Television Network now casting ENTREPRENEURS!
Do you have an amazing idea or product but need the money to back it? Would you like the opportunity to pitch your idea to several multi-millionaire investors at once?
If so, we want to hear from you!
Email a brief paragraph about yourself and your non-confidential idea along with contact info and a recent photo to:
Charisse Simonian
Casting Director
Mark Burnett Productions
csimonian@markburnettprod.com
ALL ENTRIES MUST BE RECEIVED BY OCTOBER 31, 2008!! |
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Posted by admin on October 24th, 2008 — in Angel Capital Education, Entrepreneurs
Get Ready For Some Golden Nuggets!
Over the next few weeks we will be presenting a series of posts on Financing Your Small Business. This information comes from many sources and years of experience, which we have boiled down into short informational pieces we are calling “The Golden Nuggets of Small Business Financing”.
We have encountered literally thousands of entrepreneurs seeking to finance their small business. There have been many successes and failures along the way.
Many of the so called “failures” learned from their mistakes and reinvented themselves, becoming stronger and wiser than before.
There are many reasons a small business many seek financing. If you are one of those people with an idea on a napkin, ready to seek fame and fortune, you may need to raise capital before you simply quit your day job and launch your business from ground zero. Among the things you may need at this point are:
A feasibility analysis to determine the viability of your idea;
Corporate organizational documents (articles, bylaws, minutes);
A summary business plan (or at least an executive summary);
A federal (and perhaps state) tax identification numbers;
A corporate bank account; and,
Local licenses (if required)
If you have already started a business by using your own cash (sometimes called bootstrapping) you may need to raise additional capital to:
Lease office space;
Purchase office equipment;
Develop a prototype of your product;
Hire a president, CEO or CFO
Design a logo to establish a branding and marketing program;
File for trademark or patent protection on intellectual property (IP; and,
Pay yourself a salary.
The list could go on and on.
A lot of information out there focuses on the narrower sense of financing through debt. We are going to address the broader sense of the term to cover both debt and equity. You can finance by borrowing, selling a part of the company or a combination of both.
We are going to provide you with a variety of simple techniques and resources to increase your chances of obtaining financing. We will be sharing our experience to help you avoid some of the pitfalls that can derail your business and steal your time.
The first topic we will go over is what type of company or organization you should form in order to raise capital and the various attributes of the entities. The choices include C Corporations, S Corporations, limited liability companies (LLC’s), limited partnerships (LP’s), and sole proprietorships.
Next is drafting a business plan for your company, including the various parts and the part most investors always read and some of the mistakes.
Equity Financing is after that, followed by debt financing. It is important that you understand Securities law, as this is how most emerging companies raise their initial capital. We then give you some alternatives in Licensing and Franchising as well as Friends, Angels and Venture Capital Sources.
When you are pitching your company before potential investors, you need certain skills to effectively present your case and obtain the funding. We will show you the mechanics of a good presentation, the use of presentation software and tips for speakers.
We will discuss the elements of corporate record keeping and selected issues of corporate governance. Next we go over guidelines for choosing your professional advisers. Compliance with securities laws can trap the unwary. Thoughtful entrepreneurs are well-advised to choose competent professionals to help them navigate the law and lore of this legal specialty.
Finally we will give you some of our favorite reference sources for further study!
Get Ready – and see you Next time on the Angel Network Blog.
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Posted by admin on October 16th, 2008 — in Angel Capital Education, Entrepreneurs, Investors
From Gail Lynn at http://gforceconsulting.com
Pitfalls of Business Failure…
I stumbled across this information by Patricia Schaefer on the website http://www.businessknowhow.com. I could not have said it better myself so I thought it would be the topic of my newsletter this month. Enjoy!
Pitfalls of Business Failure and How to Avoid Them
1. You start your business for the wrong reasons
Would the sole reason you would be starting your own business be that you would want to make a lot of money? Do you think that if you had your own business that you’d have more time with your family? Or maybe that you wouldn’t have to answer to anyone else? If so, you’d better think again.
On the other hand, if you start your business for these reasons, you’ll have a better chance at entrepreneurial success:
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You have a passion and love for what you’ll be doing, and strongly believe — based on educated study and investigation — that your product or service would fulfill a real need in the marketplace.
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You are physically fit and possess the needed mental stamina to withstand potential challenges. Often overlooked, less-than-robust health has been responsible for more than a few bankruptcies.
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You have drive, determination, patience and a positive attitude. When others throw in the towel, you are more determined than ever.
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Failures don’t defeat you. You learn from your mistakes, and use these lessons to succeed the next time around. Head, SBA economist, noted that studies of successful business owners showed they attributed much of their success to “building on earlier failures;” on using failures as a “learning process.”
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You thrive on independence, and are skilled at taking charge when a creative or intelligent solution is needed. This is especially important when under strict time constraints.
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You like — if not love — your fellow man, and show this in your honesty, integrity, and interactions with others. You get along with and can deal with all different types of individuals.
2. Poor Management (GFORCE coaches leaders to run effective companies)
Many a report on business failures cites poor management as the number one reason for failure. New business owners frequently lack relevant business and management expertise in areas such as finance, purchasing, selling, production, and hiring and managing employees. Unless they recognize what they don’t do well, and seek help, business owners may soon face disaster.
Neglect of a business can also be its downfall. Care must be taken to regularly study, organize, plan and control all activities of its operations. This includes the continuing study of market research and customer data, an area which may be more prone to disregard once a business has been established.
A successful manager is also a good leader who creates a work climate that encourages productivity. He or she has a skill at hiring competent people, training them and is able to delegate. A good leader is also skilled at strategic thinking, able to make a vision a reality, and able to confront change, make transitions, and envision new possibilities for the future.
3. Insufficient Capital
A common fatal mistake for many failed businesses is having insufficient operating funds. Business owners underestimate how much money is needed and they are forced to close before they even have had a fair chance to succeed. They also may have an unrealistic expectation of incoming revenues from sales.
It is imperative to ascertain how much money your business will require; not only the costs of starting, but the costs of staying in business. It is important to take into consideration that many businesses take a year or two to get going. This means you will need enough funds to cover all costs until sales can eventually pay for these costs.
4. Lack of Planning (GFORCE specializes in planning, project management and operations)
Anyone who has ever been in charge of a successful major event knows that were it not for their careful, methodical, strategic planning — and hard work — success would not have followed. The same could be said of most business successes.
It is critical for all businesses to have a business plan. Many small businesses fail because of fundamental shortcomings in their business planning. It must be realistic and based on accurate, current information and educated projections for the future.
5. Overexpansion (GFORCE helps companies guide their growth and implement systems)
A leading cause of business failure, overexpansion often happens when business owners confuse success with how fast they can expand their business. A focus on slow and steady growth is optimum. Many a bankruptcy has been caused by rapidly expanding companies.
At the same time, you do not want to repress growth. Once you have an established solid customer base and a good cash flow, let your success help you set the right measured pace. Some indications that an expansion may be warranted include the inability to fill customer needs in a timely basis, and employees having difficulty keeping up with production demands.
If expansion is warranted after careful review, research and analysis, identify what and who you need to add in order for your business to grow. Then with the right systems and people in place, you can focus on the growth of your business, not on doing everything in it yourself.
6. No Website
Simply put, if you have a business today, you need a website. Period.
At the very least, every business should have a professional looking and well-designed website that enables users to easily find out about their business and how to avail themselves of their products and services. Later, additional ways to generate revenue on the website can be added; i.e., selling ad space, drop-shipping products, or recommending affiliate products.
Remember, if you don’t have a website, you’ll most likely be losing business to those that do. And make sure that website makes your business look good, not bad — you want to increase revenues, not decrease them.
When it comes to the success of any new business, you — the business owner — are ultimately the “secret” to your success. For many successful business owners, failure was never an option. Armed with drive, determination, and a positive mindset, these individuals view any setback as only an opportunity to learn and grow. Most self-made millionaires possess average intelligence. What sets them apart is their openness to new knowledge and their willingness to learn whatever it takes to succeed.
GFORCE: These are the clients I am seeking…if you fit the bill to the description above give me a call and let’s see how we can be successful together!
DID YOU KNOW?!
This seemed appropriate for 2 reasons….1) once you see what you need to do to run a successful company you will need one of these; 2) my sister is on a plane right now, headed for Denver to attend the Great American Beer Festival…I’ll be joining her tomorrow for the evening. Not sure I will get my monies worth, but it’s time with my sis.
Worldwide, 20,000 brands of beer are brewed in 180 styles, from ales, lagers, pilsner and stouts to bitters, cream ales and iced beers.
Beer has been a popular beverage for a long time. Babylonian clay tablets show detailed recipes of beer making in 4300 BC. Beer was also brewed by the ancient Chinese, Assyrians and Incas.
An Egyptian text of 1600 BC gives 100 medical prescriptions using beer. A few years ago, the New Castle Brewery in England brewed 1,000 bottles Tutankhamun Ale from a 3,200-year old recipe found in the sun temple of Queen Nefertiti.
Commercial beer making was established in 1200 AD in present-day Germany. In 1506, the German Purity Law is issued, specifying that beer ingredients must only be water, barley, wheat and hops. Bottling of beer started in 1605.
Sincerely,
Gail
“Watch your thoughts; they become words.
Watch your words; they become actions.
Watch your actions; they become habits.
Watch your habits; they become character.
Watch your character; it becomes your destiny.”
- - Frank Outlaw
G Force Consulting, LLC
Cell: 972-951-3338
Email: gail@gforceconsulting.com
Website: http://www.gforceconsulting.com
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Posted by admin on October 14th, 2008 — in Uncategorized
To: Angel Network Entrepreneurs
From: Ed Bracken - President
RE: Can You Use Celebrities To Endorse Your Product?
Dear Entrepreneur,
Have you ever thought of using celebrities to endorse your
companies product or service?
What if I could guarantee you to meet, face to face, with
dozens of celebrities to pitch your product and ask them to
endorse your company/product?
What if YOU could get pictures with them holding your product
that you could use in your marketing material?
AND all this could take place in a 48 hour period of time? In the next 45 days!
*********************************
“Angel Network Can Make This Happen For YOU!”
*********************************
You can meet, shake hands with and spend 2-10 minutes with
each celebrity and pitch your product.
We’ve done this and now you can too!
My partner Greg Writer recently did just this and if you want
to see the pictures he took with celebrities please visit this link:
http://www.gregwriter.com/famous-friends/
But here is the number one reason your should considering
celebrities endorsements!
—>>>> IT WILL HELP YOU RAISE MONEY!
And in today’s environment you need an edge and getting a
celebrities to lend their name to your product could be the
difference between getting funded and going broke!
Bottom line is that celebrities sell!
If you can figure out how to use celebrities to promote and
market your product your sales will increase and it will help
in your funding process.
So if you want to find out how you can participate YOU MUST
call 760-489-1342 ASAP!
We only have room for about 5 entrepreneurs to participate in
thIS program! We have over 3,246 entrepreneurs that are
getting this email and this opportunity will be on a 1st come
1st serve basis.
So if you are serious and are ready to get meet and pitch
celebrities then call now.
Have a great day!
Ed Bracken
President
AngelNetwork.com, LLC
PS Remember this program GUARANTEES you will meet face to face and have the opportunity to pitch your product to celebrities! Greg met over 75
celebrities and got interest 11 of them to
endorse Children’s Educational Network! If you want to apply
for this program call 760-489-1342 now!
PPS There are only 5 slots for this program so you must act
fast and 3,246 entrepreneurs are getting this email, and these slots will go fast!
http://www.AngelNetwork.com
Serving The Needs Of High Net Worth Investors & Entrepreneurs.
Owned and operated by:
AngelNetwork.com, LLC
283 S. Escondido Blvd.
Escondido, CA 92025
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Posted by admin on September 9th, 2008 — in Angel Capital Education, Entrepreneurs
It’s pretty rare to get an Olympic Gold Medal, wouldn’t you say? Only 1,210 Americans have received one. It’s unusual to climb Mt. Everest, too: Just 2,300 people have done that. But there’s an even rarer category: The number of billionaires. No more than 1,125 people in the world can claim that distinction.
My friend, Bill Bartmann, did just that. Now keep in mind that this group of 1,125 people includes people who had major help along the way: Many were born with it, inherited it, or had every advantage while growing up.
In the history of billionaires, Bill Bartmann stands alone. He’s the ONLY former homeless person and gang member ever to have made a billion dollars. That’s right, Bill went from eating out of dumpsters and living under a bridge viaduct, to having after-tax, take-home pay in a single year of more than $100 million and being listed as the 25th richest person in America.
Here’s where it gets extremely interesting: Bill is willing to coach YOU on how to succeed in business.
After all, what can you learn from someone whose daddy died and left him a billion? But it’s totally different with Bill Bartmann: He worked in a slaughterhouse. He was an alcoholic at age 17. And at one point Bill was paralyzed from the waist down. Yet Bill discovered a DIFFERENT way of thinking and acting that enabled him to overcome all of that, and become a self-made billionaire.
After scaling the highest peaks in the business world and getting his fill of toys like $25 million aircraft, what’s Bill up to now? He has one current passion: Showing others his special techniques for overcoming any challenge and being as successful as they want to be.
Do you think Bill might know a few things YOU could use to overcome your own challenges? What if you could get his thoughts on dozens of business topics?
Now you can. Bill is launching a one-of-a-kind online service, called his “Billionaire Business System“. This is not some one-size-fits-all deal. Instead, Bill has built a mentoring tool that provides you with laser-targeted advice on many individual topics.
Are you already running a business but not sure what’s the best way to secure financing for your next stage of growth? Bill covers that topic. Not even sure if business is right for you? Bill has a video session just about that.
In fact, the Billionaire Business System currently has almost two dozen topics, and is constantly growing.
I strongly recommend that you take a look at Bill’s system and see for yourself how it can remove whatever roadblocks are in your way to greater business success. You can find it by going to: http://www.billionaireu.com/go.aspx?AID=1394
Name me anywhere else on the planet that you can get specific, useful, and comprehensive business-building advice from a self-made billionaire? That’s OK, I can’t think of any, either.
The sooner you have Bill Bartmann in your corner, advising you on business success, the sooner you can sit back and bask in your own dreams coming true.
To Your Success,
Greg Writer
P.S. The chances are really good that whatever challenges you have, Bill’s been there, and found a way to overcome them. Let Bill show you how, by taking the easy step of going to http://www.billionaireu.com/go.aspx?AID=1394
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Posted by admin on February 20th, 2008 — in Angel Capital Education, Entrepreneurs, Uncategorized
Greg Writer |
Teleseminar recorded live on February 13, 2008.Is your business worth it? Take a look at the numbers. Are you COMMITTED? What’s wrong with your deal? Where do you find the right investors? What type of investor do you need?
|
www.angelnetwork.com
|
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Posted by admin on February 19th, 2008 — in Angel Capital Education
The Central Texas Angel Network (CTAN) of Austin, TX (www.centexangels.org) has been in operation less than 18 months, but has made quick progress. The group ended 2007 with 50 members and more than $3.6 million invested in 14 deals.“Austin has a history of angel investing,” says Hall T. Martin, CTAN executive director. “We had some strong groups in the nineties, so there is a long history of people who are interested in taking risks in technology and doing angel investing in general.”
When the Internet bubble burst in 2001, the angel community in Austin fragmented, but Martin says that 2006 marked the beginning of new cycle. “Jamie Rhodes, CEO of Perceptive Sciences and CTAN chair, was going to angel meetings in Houston. He noticed that about a third of the members and presenters were from Austin,” Martin says, “so he and others founded an angel group here.”
The Austin Chamber of Commerce helped with press and publicity and provides a room for meetings. “We were able to set up a fairly low cost virtual model,” Martin says, “and it’s turned out to be synergistic with the Chamber. What we do also contributes to the community.”
CTAN is a member-managed network
Central Texas Angel Network is a member-managed group, with each member making his or her own investment decision and investing as an individual. “We learned the hard way from the groups in the nineties not to live off sponsorship money,” Martin says. “This time we followed the example of the Houston Angel Network. Each member pays $1,500 in annual dues.”
The group has about a 50 percent retention rate. “The biggest mistake people make,” Martin says, “is that they underestimate the time it takes to do angel investing properly. After a year people come to understand that, and some of them do drop out.”
CTAN invests in Texas-based companies and targets rounds of $1 to $2 million, preferring to participate in syndicated deals with other angel groups such as the Houston Angel Network and venture capitalists who invest in early stage companies. “If a trusted resource brings you someone, the quality is much higher,” Martin says.
“With off-shoring, the costs of doing business have gone down dramatically, and new companies are figuring out how to be more capital efficient,” Martin says. “What used to be a $5 million investment deal in the nineties might be a $500,000 deal today. I call it the Golden Age of Angel investing.”
Several local venture capitalists are commercial members of CTAN. “They pay annual dues of $3,000 and have two chairs per firm at our deal meetings,” says Martin. “The VCs who are part of our group want to fund early stage and emerging technology businesses and play nice with angels, so it all works out well.”
CTAN receives 30 to 40 business plans per quarter
An entrepreneur pays $250 to submit a business plan on www.centexangels.org. “Before we had our site up and running, we received calls and plans for a lot of non-angel deals,” Martin says. “Now we have people really thinking hard before they submit. About half the deals we see are the type and quality that we want. In 2007we saw at least 15 good deals every 90 days; in 2008, we are going to have six deal flow rounds instead of just four rounds.”
Martin and others review the plans that are submitted and select four to present at quarterly screening meetings where the entrepreneurs pitch their companies. CTAN then forms a due diligence team. Three of every four deals that are presented typically have a term sheet already, but if there isn’t one already, a lead angel is named to lead the term sheet team.
Two of the four vetted deals are typically funded. Once the two are chosen, the group holds an angel investing lunch to present the term sheet, valuation, and tax consequences to the membership.
CTAN looks for companies that have a complete product and an entrepreneur who has invested some personal capital in the business.
“Our sweet spot is to invest $500,000 to $750,000 in a $1 million round,” Martin says. “Because we have such good deal flow, if a company doesn’t yet have a customer, they aren’t likely to make it into our top four.”
The group is open to all industries and tries to be as diverse as possible
“In Austin, it’s easy to end up with software and web businesses,” Martin says. “They currently make up about half our portfolio, but we are also interested in medical devices and healthcare. Some of our members come from the film/video/media industry, and we also do consumer products from time to time.”
Some of the key deals funded last year were Perception Software, which provides electronic design automation software; Displaypoints, an at-the-restaurant table digital media device, and Minggl, which is social networking software.
Martin says that the CTAN membership seems to favor certain terms—such as preferred equity, redemption rights, accumulating dividends, and liquidation preferences, but that all those terms aren’t achievable in every deal.
“This year we are making it clear what a term sheet is and can do,” he says. “People are starting to understand what they really want. They are learning that if you really want preferred equity, don’t vote deals with convertible notes into the presentation meeting.”
The group is working on a standardized term sheet methodology. “As we close more deals, we will be working on a process to identify the top three risks in most deals and choose terms that mitigate those risks,” Martin says. “We don’t have it all worked out yet, but the idea is to match terms to the risk appropriately.”
Education for angels and entrepreneurs is a CTAN priority
CTAN has held five angel education sessions focusing on topics such as valuation, due diligence, financial due diligence, angel/entrepreneur interaction, and planning for successful M&A exits. They ask local and regional attorneys and other service providers to teach a session at no charge.
“This gives them the opportunity to do a good job and meet the angels while the angels receive training in things they need to know,” Martin says. “The group also participated with the Austin Technology Incubator in term sheet education for entrepreneurs.”
CTAN also provides an introduction to funding seminar once a quarter. “These sessions started out with 30 people and grew to 100,” Martin says. “These meetings have been very effective.”
Martin says the group is working with other organizations in Austin to create a four- to eight-week fee class for entrepreneurs to teach term sheet, business plan writing, and other relevant topics. He also writes a blog called Angel Investing in Austin (www.angelinvestinginaustin.blogspot.com).
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Posted by admin on January 17th, 2008 — in Internet Marketing
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Posted by admin on January 14th, 2008 — in Entrepreneurs
As a veteran business owner, I’ve taken my share of bumps and bruises. While starting and growing your own business can be an incredibly rewarding experience, it can be just as humbling. You can feel like Superman one moment and the village idiot the next. So, it’s important to have a solid foundation, a good business plan and some reliable resources.
1. Keep Your Ear to the Ground
By taking the time to read this issue of Website Magazine, you’re taking a good first step to the holy grail of business growth — knowing your industry. Particularly with the Web and IT, the business climate and technology are changing at a blinding rate.
While magazines and books are a great start, you need to do more. Blogs and forums are particularly good for finding new events and assessing the industry’s take on a breaking piece of news or new technology. But most of the time, this information is not edited and contains more opinion than fact. So, use your street smarts and be sure to feed your brain a steady diet from mainstream sources like magazines and established websites.
Magazines, blogs and forums are terrific resources for getting your daily dose, but getting out, pressing the flesh and attending conferences is a must. Meeting your contacts face-to-face and talking shop over coffee can take a relationship to a deeper level.
2. Feed Your Relationships
A lot of folks talk about networking as if it is the nexus of business. It is. However, if not done properly, your efforts will be wasted and you could even damage your credibility.
Networking with colleagues, vendors and other people important to your business should be seen for what it is — relationship development. And just as you need to work and feed other relationships in your life (i.e. friends, spouse, children), you need to be an active and giving partner in your professional relationships.
Understand the challenges your associates face and help them. As your professional network grows, you’ll have access to more and more people — all with their own skill sets and resources. So, when your Web host complains about dealing with charge backs, you can refer them to your credit card processing rep. As you understand your partners’ resources and problems, new avenues for networking will undoubtedly appear.
3. Honesty Counts
As with any relationship, honesty and good faith with your business partners, employees and vendors are crucial to preserving your business’ integrity. Sometimes, this means sacrificing your own needs in order to further a relationship. It’s a small price to pay in the short term, which ultimately will provide dividends by building a larger and more trusted network of colleagues.
4. Use Leverage
Leverage is a key principle of starting and growing a business. If you’re currently responsible for managing staff, then you know what I mean. As a business owner, I’ve drafted contracts, hired new staff, reviewed financials and cleaned the toilets — all within the same week.
Sometimes, we need to do these things to make the business work. However, as your business grows, you need to understand which parts of that business can be broken down and handed to other people. This could mean your staff, outsourcing to other companies or even hiring professionals, like accountants and attorneys.
As you find new opportunities to leverage the time and experience of others, be careful to clearly outline your expectations. Depending on the scope of the work (i.e. account reconciliation, sales, etc), it is helpful to establish a specific reporting routine and measure your progress against goals set forth by you and your staff. Once this is done, the hardest part for many business owners is simply letting go and allowing others to handle your work.
5. Have a Backup
A few years ago, I was working with a broker to sell a business I owned. After three months of interviewing potential buyers, we had a handful of possible deals to select from. As would be expected, several fell through right at the beginning.
A few weeks later, we had three deals on the table and entered due diligence with the highest bidder. The buyer placed funds in escrow and I began collecting information from my staff to provide to the buyer. Over the next week, the buyer becomes increasingly non-communicative but, according to the broker, is still interested. We kept trying to make contact.
Gut instinct told me that the buyer was no longer interested and an ultimatum was delivered. So when the buyer failed to provide a response, I knew it was time to go to my backup deals. Within 36 hours we had a deal with another buyer and, two weeks later, a completed closing on the sale of the company.
6. Always Pack Your Parachute
Hopefully, the aforementioned example shows the importance of having a backup for deals that you might have, or think you have at any given time. This includes deals for partnerships with vendors, clients and even employees. However, as a business owner you need to be conscious of the fact that you’re working without a net and, as a result, need a backup plan.
The best time to plan your escape is before you’re in danger. If things don’t turn out as planned, how much risk are you willing to tolerate while trying to turn the business around? New businesses need time to mature, but sometimes it takes more time and money than planned. Before launching your business, you need to think of some possible scenarios and how to deal with them.
As a professional in the Web space, you should already be keeping up with trends and maintaining and expanding your network. Both of these activities will help you and your business. If you need to close, sell or otherwise dissolve your business, maintaining your contacts and an intimate knowledge of the industry will only make you more employable.
7. Make Time For #1
Being a business owner makes you an executive. You need to have executive poise, presence, awareness and work ethic. As would be expected with any executive position, your role as business owner will place extraordinary demands on your time. Therefore, it is vital to find ways to renew and improve yourself.
Notice that I used the word ‘renew’ and not ‘rest.’ There is a difference. Simply sitting in front of the TV and watching re-runs of 24 doesn’t do anything to break the fatigue of running a business. You need to find a reason why. Running a business can be fun and exciting but it is simply a means to an end. Working five or six seventy hour work weeks in a row has the tendency to make anyone forget why they’re working hard in the first place.
Find something you love and work at it. This could be anything from woodwork to tennis. The stress of business is what drove me to my favorite hobby. Working day in and day out with little rest, I found that going out for a good 5k or 10k run a couple of times every week helped me deal with stress and gave my brain a break from constantly thinking about my business.
In the end, running a successful business is a monumental task. It takes emotional balance, strength, patience and stamina to make it to the finish line. So, whether you’re already a netprenuer or aspiring to be one; set a business plan, follow these time-tested guidelines and make the most of your available resources — one of the advantages of a Web-based business is having many valuable tools at your fingertips.
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About the Author: Josh Ewin has enjoyed a decade-long career in website development, planning, marketing and production. He led the startup development of three successful Internet companies before currently working on a yet-to-be released project. Find out more at www.mrewin.com. |
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