BROKER OR FINDER / ADVISOR OR HAND WAVER
Karl Dakin
I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
QUICK CALENDAR
TOMORROW, OCTOBER 31 (Halloween), Community Revitalization show, 8 am MDT / 10 EDT, Linkedin Live
?FUNDING HAPPENINGS
?NonProfit Pro publication has released its 2024 Nonprofit Fundraising Study. You may download it for free from the link to their website.
?FUNDING POINT – BROKER OR FINDER / ADVISOR OR HAND WAVER
Tomorrow’s edition of the Instant Funding newsletter will focus on family offices as a source of funding. To better prepare readers for that article, today’s article compares and contrasts people who may introduce a small business to a family office.
A securities broker is a licensed professional who acts as an intermediary between buyers and sellers of securities, such as stocks and bonds. They facilitate transactions on behalf of clients, provide investment advice, and help clients develop strategies for buying and selling securities. Brokers typically work for brokerage firms and are compensated through commissions or fees.
?A securities finder is an individual or entity that assists companies in locating potential investors for their securities offerings. They typically facilitate introductions between the issuer, such as a startup or business seeking capital, and potential investors, such as venture capitalists or institutional investors. Securities finders usually provide services for a fee and are not involved in the actual transaction or advisory roles like broker-dealers. It's important for companies using finders to ensure compliance with all relevant securities regulations.
?Within these two descriptions are several keywords that a small business should understand and factor into its capital campaign strategy and plan. Both a securities broker and a securities finder are intermediaries. They stand between the source of funding and the organization seeking funding.
?From a legal standpoint, their roles are different. A broker is authorized to promote the sale of the security to the funding source by offering advice, while a finder is only permitted to make the funding source aware of the investment opportunity.
?From a practical standpoint, they both require trust in their relationship with the funding source.
?I seldom get the chance to work with a licensed broker for two reasons:
1.???? The investment opportunity is so small in dollar amount that the broker cannot earn a reasonable fee for their efforts if successful and
2.???? Most small businesses look to avoid the cost of broker fees.
?When an investment opportunity of sufficient size is presented to me, I have to determine if there is a broker I know whose group of investor candidates may have an interest in the subject of the opportunity and trust the advice of the broker enough to make the investment. Similarly, I have to determine if there is a finder I know whose group of investors may have an interest in the subject of the opportunity. However, a finder is not authorized to provide financial advice, thereby limiting their capability of fostering an investment.
?As a practical matter, brokers and finders will have a limited number of investor candidates with whom they have an established relationship of sufficient trust that may predictably result in an investment.
?This calls into question the honesty of anyone who claims they have hundreds of relationships with investor candidates. It may be true that their contact list has all of these names, but knowing someone and having them trust you are two different things.
In addition to the requirement of trust, there is a need to know the current investment preferences, availability of cash for immediate investment, or other factors that may influence or dictate whether any one investor candidate is ready and willing to invest in a particular opportunity.
?Michael Kitces stated in his article on Dunbar’s Number And How Many True Financial Planning Client Relationships You Can Really Have that “Accordingly, this suggests that even as financial planning businesses become more efficient, and time becomes more leveraged with technology, it may be unrealistic to expect that planners will ever be able to maintain more than about 75-125 real client relationships (allowing for some room for other personal relationships as well!).”
?Raising money becomes a numbers game of (1) how many people does the leadership of a small business know directly without an intermediary, (2) how many brokers and finders does the leadership of the small business know and (3) how many clients of each broker or finder have a high enough level of trust to follow their advice or an introduction?
All in all, every broker or finder has a limited number of investor candidates whom they may influence. If claims are made about the extent of this influence and the large number of investor candidates who may be influenced, then small businesses should assess their trust in that person.
POLITICS AND PROFITS
I appeared as a guest on Rick Amato ato’s Politics and Profits show, where I spoke about ‘disinvested communities’. I provided examples and explained how strategic investment into these communities may serve to empower the communities through greater wealth and skill building. I pointed out that turning these communities around would remove a great burden from the government and charities that could put money to use in other places. I invited people to support the efforts of @RCI Community Funds and the RCI Academy.
SUCCESSFUL FUNDING SHOW
THIS MORNING, October 29, on my Successful Funding show, I hosted Adam Kemper r with Real FIG Advertising. We discussed a comparison of communications that are actual and artificial intelligence-enabled. It was acknowledged that to build a needed level of trust, certain communications require the personal touch, while other communications, largely informational, can be delegated to an AI. In addition, AI may be a tool in supplementing selected communications by finding data and validating information.
You may see a recording of the show at:
领英推荐
RCI COMMUNITY FUNDS
As a member of this new company, I am working with a team of professionals to craft a new funding mechanism for revitalizing underserved communities.
Approval was given by the State of Maryland for the formation of @RCI Community Funds Benefit LLC – this for-profit business is working to raise and deploy funding strategically into a series of selected communities.
In parallel, the newly formed RCI Academy Corporation will offer educational programs on community revitalization.
RCI Community Funds presents the Community Revitalization show on Thursdays at 10 am Eastern Time on LinkedIn, YouTube, and Facebook.
THIS MORNING, the Community Revitalization show featured the new nonprofit – RCI
Academy and its first educational program on Community Capital. Andrea Miller, Executive Director of the Center for Common Ground discussed with Karl Dakin the importance of understanding community capital as a concept in organizing collaboration toward improving underserved communities.
You may view a recording at this link:
DON COHEN SHOW
MONDAY, I was the guest on the Don Cohen show, October 28, 9 am MDT, 11 EDT, on LinkedIn Live. Don and I discussed financials and how they give a picture of a business from a dollar and cents perspective. We also discussed the distinction between a point and time and different perspectives looking backward and forwards with and with adjustment for income taxes.
You may see a recording of the show at:
LAST WEDNESDAY, I was a guest again on the Don Cohen show along with Charles Caldwell. We discussed planning as a key to success.
If you would like to view a recording of the show, go to:
SUBSCRIBE
You may subscribe to this Weekly edition of my Instant Funding Newsletter, or you may subscribe to my Daily edition.
Karl Dakin, the Capital Coach
Dakin Capital LLC
--
3 周Thats going to be veary Interesting event thanks for sharing this best wishes to each and everyone their ?????????????????????????
I help you overcome challenges to raising capital. Take advantage of my Motivated Money Method to identify those investor candidates that are most likely to invest. Top expert in fundraising.
3 周Who do you trust?