DELIVERABLES
Karl Dakin
Capital Coach | Stakeholder Investor Campaigns | Design, Stage, and Manage or Support | Reduce Time, Money, and Risk of Raising Funding | Increase Probability of Success! | Opportunity Management
CONTENTS
?·?????? Quick Calendar
·?????? Funding Points
·?????? Successful Funding
·?????? Don Cohen Show
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QUICK CALENDAR
?I quickly list here upcoming opportunities where I will be sharing information, lessons in funding, or meeting in person or via videoconferencing.
?June 12 - SuperCrowd Chicago – Crafting Crowdfunding Offers to Customers
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SUPERCROWD CHICAGO – JUNE 12 – NOW ALSO FREE ON-LINE
?I am co-sponsoring and will be speaking at SuperCrowd Chicago next week. This event promises to bring together leaders in investment crowdfunding to share what works and what does not work and next steps in advancing investment crowdfunding as an alternative, if not the best option, for small businesses raising funding.
?People may attend in-person for a fee (50% discount coupon below) or they may watch for free on live streaming on e360tv network (Roku, Apple or Amazon) or watch at ?s4g.biz/12jun24. Opening this event to viewers enables everyone to benefit who cannot travel to Chicago.
?FUNDING POINT – DELIVERABLES
?In a business transaction, each participant is expected to deliver something to the other participant. This is an outcome of success.
?An equity investor in a small business expects a return on their investment. The return represents an amount of money in excess of the dollar amount of the original investment.
?In many, if not most, investments, the investor expects something beyond the return. These outcomes may benefit the investor in other ways beyond money. The benefits may be monetary or non-monetary, and they may be direct or indirect. In effect, a small business enters into a contract with the investor, and the performance of the business will be judged by the nature and extent of all deliverables.
?It is important when developing a business model, planning a business, or creating an investment offer to identify, quantify, and qualify all outcomes. Vagueness and lack of clarity in an investment proposal suggest that the outcomes are not real or that the management team does not know what they are doing. Admittedly, there are many new business ventures that are striking off into the unknown of technologies, market acceptance, and economic conditions. However, investor candidates prefer certainty. To the extent that a small business cannot guarantee the future, it must be more clear as to its intended goals and all associated deliverables.
?I have used and will continue to use the illustration of the sale of lemonade in making Funding Points. What are the goals and associated deliverables of operating a lemonade business?
?A small business cannot simply state to an investor candidate that it intends to sell lemonade. At the very minimum, it must state that it will sell a volume of lemonade, resulting in a dollar amount of profits, of which a share will go to the investor. The deliverable is quantified in terms of dollars returned. That is not enough.? If the lemonade business sells $100,000 of lemonade with a cost of $80,000, it may earn a profit of $20,000. If half of this profit is paid to the investor, they earn $10,000.
?The statement regarding the return on investment must include the time in which the return is achieved. This enables a calculation of the rate of return. This is still not enough. If the sale of lemonade and earning of profits occurs over two years, then the investor has earned $5,000 per year.
?The success of earning $5,000 a year may have no impact on the investor unless it is delivered to the investor in the form of a profit distribution or dividend.
?An investment offer must state when the investor will receive back their original investment plus the return. This is the ‘exit’ of the investor from the investment. Without defining when the original investment is paid back to the investor, the investor is along for an indefinite ride. Many investors have found themselves trapped in an investment where they cannot get out.
?If the investor invested $25,000 and is delivered only two distributions of $5,000 each, then technically the investor has lost $15,000. The investor must also be paid back its original $25,000 in addition to the $10,000 in its share of the profits before the investment is complete.
?Although an investor may be only passively engaged in the business by providing capital and their preference is to do no more than to write checks and receive distributions, prior to making an investment, the investor candidate wants confidence that they will be delivered both a payback of their investment and payment of a return.
The investor candidate will look to other deliverables to evaluate the probability of success and the risk of failure. The question is raised as to what other deliverables must the business work to achieve that demonstrate competence and capability?
领英推荐
?In a startup business, all deliverables are projections. Only the prior experience of the management team has a track record.
?The ability to identify and describe the deliverables of operating a business successfully aids the investor candidate in assessing the investment opportunity and in making a selection amongst multiple investment opportunities.
?It is recommended in planning and forecasting a small business go beyond a simple cash flow and income projection and create a catalogue of anticipated deliverables that better tell the story of the business. Those deliverables that benefit any of the investor candidates should be highlighted within the investment offering.
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SUCCESSFUL FUNDING
On Tuesday, June 4, my guest on my Successful Funding show was Kon Apostolopoulos. We discussed leadership. The conversation focused on the investing in relationships where a business may benefit from advancing the careers of its employees.
?You may see the show recording at:
?You can see all of my shows at the time of broadcast or recordings of past shows at my profile on LinkedIn.
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DON COHEN SHOW
On Monday, I was a guest on Don Cohen’s show with Kon Apostolopoulos where we discussed strategy. Strategy is the map of getting from where you are to where you want to be. The greater challenge is often the communication of the strategy to the team and to the public.
You can see a recording at:
I enjoy being a guest and engaging in conversations with Don and other guests on building communities and using LinkedIn as a communication channel. Every show is its own adventure as we start with a word of the day and then see where the conversation goes from there.
Don is an expert on LinkedIn, particularly on the use of Live streaming to build brands and communities. We will discuss using LinkedIn as a social media platform for building communities that support raising funding.
All shows where I have been a guest can be viewed on Don Cohen's LinkedIn page under Posts.
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Karl Dakin, the Capital Coach
Dakin Capital LLC
Capital Coach | Stakeholder Investor Campaigns | Design, Stage, and Manage or Support | Reduce Time, Money, and Risk of Raising Funding | Increase Probability of Success! | Opportunity Management
9 个月What are the deliverables to your investors upon your success?