Category: Perfect Financial Structure of a Business (a series)

Evergreen Investment Capital Gains More Traction

This idea should be obvious:  Most companies will not do their best work if forced to grow artificially fast (think growth hormones).  If you aim everything toward fattening up for an exit time; if you force-feed unnatural energy like corn or capital, binge on antibiotics, and then… Continue reading

The Mirage and False Hope of an “Exit Strategy”

At best, an exit strategy becomes overrated and a waste of breath.  At worst, an exit strategy becomes a destructive mirage of certainty and false hope.  I realize that it is conventional wisdom for every entrepreneur to specify their exit strategy.  I have even heard… Continue reading

Private Equity Trending Toward Longer Term Models Like Greybull Stewardship

Momentum is growing toward private equity structures with longer term time horizons and movement toward more “permanent capital” — structures that are more similar to Berkshire Hathaway and Greybull Stewardship (my private equity fund focused on companies with $1-3 million in profit). Blackstone private equity… Continue reading

Disparate Data Points: Entrepreneurship Exploding or Dying?

An explosion of young companies that are bootstrapped, or financed outside of traditional venture capital (i.e., Silicon Valley) or traditional bank financing, is what I see every day.  I see many companies finding their way to a point of lift-off, stability, and medium-sized revenue and profit… Continue reading

Companies and Founders Deserve Better Financing Options

Business financing and capital raising are full of contradictions.  The world is awash in capital, but the availability of capital to businesses is often binary.  For some, too much capital is stalking them.  For others, the switch to turn on capital flow remains hidden.  Size… Continue reading

Warren Buffett’s Strategy, Selling Your Business, and Other Topics in Podcast Interview

I was interviewed recently by a very good business broker, Jim Cumbee of the Tennessee Valley Group.  I have gotten to know Jim this year as we worked on a transaction and we had a fun discussion about several topics including: Lessons learned about selling… Continue reading

We’re In Seed-Stage Boom, Not a Series A Crunch

Two related trends in venture capital investing have been getting attention for the last few years. The first is the growth in angel investing, particularly after the crowd-funding provisions of the JOBS Act. The second is the “Series A crunch” where many companies that receive… Continue reading

Perfect Business Financing — Maybe No Outside Equity

Many of the businesses that I end up working with in my investment fund, Greybull Stewardship, do not need outside equity capital — of the traditional sort.  They are growing and profitable and creating real value already. I learn about perfect business financing from them.… Continue reading

Align Your “Loss Ratio” Expectations with Your Investors

In early stage venture capital, the best investors expect that 40% of their investments will become worthless.  Thus, they focus on companies that could be worth billions because the winners have to make up for all their losses.  They want every company to shoot for… Continue reading

Best Financing Source for a Business: Its Customers

Financing growth for your business with cash from customers, rather than more expensive debt or equity, makes your ownership even more powerful.  In most of the investments made into operating companies by Greybull Stewardship, my investment fund, our operating companies get paid by customers before… Continue reading