INSTANT FUNDING WEEKLY EDITION #16

QUICK CALENDAR

MONDAY, September 2, Labor Day.

TUESDAY, September 3, Successful Funding show, 8 am, MDT, LinkedIn Live

NEXT THURSDAY, September 5, Community Revitalization show, 8 am, MDT, LinkedIn Live

FUNDRAISER FOR CANCER LEAGUE OF COLORADO

I am raising funding for the Cancer League of Colorado. Information on this charity fundraising campaign is presented in the Instant Funding editions on August 30th and 31st and September 1st and 2nd.

You may donate directly to my Over the Edge campaign through the Cancer League of Colorado at:: https://www.denverovertheedge.com/teams/dakin-capital/

You may also donate through the GoFundMe platform at https://gofund.me/028df78d.

Everyone who donates a minimum of $50 will receive a subscription to Dakin’s Edge: Charity Fundraising Kit. This online set of tools provides information, plans, and promotional materials to help an individual carry out a fundraising campaign to support their favorite charity.

FUNDING HAPPENINGS

Funding requires the development of relationships.

A funding campaign is not simply exchanging money for an opportunity to make more money. It is a transaction built on top of a relationship. This relationship must exist prior to receiving the money, or no money will change hands. The relationship will continue until the investor exits the investment. In terms of relationship management, it should have goals, strategy, and a plan for engagement and realizing its potential.

Funding is a way of showing care.

By providing funding, an investor (in the broadest definition of the term) is demonstrating what they care about. By writing a check, giving up time, sharing facilities, or any other form of making resources available to someone else, an opportunity exists to make a difference and show what one cares about. So many things that one does are never seen, do nothing, and leave the world in the same place one started. Funding is an expression of self.

Everyone needs funding.

Every day presents opportunities to raise funding and to provide funding. Despite this commonality, people often look at funding differently based on their needs and the sources of funding. While each need and each investor is different, that does not necessarily mean that fundraising must be that different.

There are no free lunches in funding.

As I availed myself of the library of knowledge within Wikipedia instead of making a request through Chat GPT, I was reminded by Wikipedia that they have a cost in providing their service, and I was asked to make a donation to their foundation. I made the donation because they provide value to me, and I would like them to continue doing so. I also have a subscription to Open AI for Chat GPT for the same reason. As an entrepreneur, I work to limit my expenses, but there comes a point where other entrepreneurs should be rewarded for their efforts.

Funding does not happen in a straight line.

Although it would seem that funding is logical in that an investor places their money into an opportunity with an expectation of making money, the opportunity that is the subject of the investment may be anything except logical. It may represent visions and hopes that may never be realized or which will require serious compromise in order to attain any part of the original goals.

Funding is seldom perfection.

When seeking funding, one should seek perfection and accept any reasonable outcome that works. Although everyone would like a win-win outcome, more often, compromises must be made where it is necessary less than an optimal investment. Anything less than perfection should be measured in the upside that can be gained regardless of how the deal was crafted. If it becomes murky whether the deal will or will not move the business forward, it may be time to look to a different investor or craft a different offer.

Patience is needed in funding and creativity.

If a match between an investor candidate and a business opportunity seems logical, then patience may be required to allow each participant to realize this outcome. Patience by itself may be a virtue, but realizing an opportunity may require less than divine intervention through education, diplomacy, mediation and leadership.

A stalled investment benefited from considering the agenda’s of each member of the investment group. This revealed complementary, but different agendas. By breaking the opportunity into different components, it became possible to have part of the funding group put money into one component and the other part of the funding group to put money into the remainder. Each part of the funding group advances with a hybrid deal that may be greater than the original opportunity.

FUNDING POINTS

OVER THE EDGE – SUPPORTING CHARITY – #3

?The Cancer League of Colorado is a charity that I support. Since 1985, Cancer League has donated over $16 million in grants toward cancer research and services.

My support will come in the form of membership, a money donation, volunteering my time, and recruiting others to match my donation to their Over the Edge event. https://www.denverovertheedge.com/

On September 20th or 21st, I will rappel 200 feet from the bridge at McGregor Square in Denver, Colorado to call attention to the great work of the Cancer League of Colorado and my fundraising campaign.

People and businesses like mine can volunteer to raise money and rappel. If you are interested in joining this effort, please REGISTER.

?This event enjoys the participation of several individual and team fundraisers and a number of professional team mascots.

?The Cancer League of Colorado presents a number of different fundraisers each year – the annual Gala, golf, and 10K run in addition to the Over the Edge event. I chose this event because it offers an opportunity to raise funding for a specific event. This helps me in my fundraising efforts because the Cancer League is doing all of the heavy lifting in organizing the event and recruiting volunteers. I can focus my efforts on reaching out to my network and to the public to make them aware of the Cancer League and to promote the opportunity to make a charitable gift.

?My goal is to be in the top 10 team fundraisers. Last year, to achieve this goal, I needed to raise $6,000. This is a small dollar amount in the scope of the great work of the Cancer League and the even greater need to cure cancer.

?To give me an edge over bigger teams, I am offering a reward to anyone who donates a minimum of $50 to my fundraising campaign. I have authored a fundraising kit to help individuals and businesses raise money for their favorite charities. I used my Motivated Money Method and Chat GPT to create templates and examples of strategy, donor candidate identification, planning, and promotional materials. It is provided in a package that can be downloaded and customized to fit.

OVER THE EDGE – SUPPORTING CHARITY – #2

I have chosen the Cancer League of Colorado as a charity that I choose to support.

My support will come in the form of membership, a money donation, volunteering my time and recruiting others to match my donation in their Over the Edge event. https://www.denverovertheedge.com/

As expressed in yesterday’s edition of this Instant Funding newsletter, I recommend that everyone adopt a charity.

So why did I select the Cancer League of Colorado? Selection of a charity is similar to an investor picking a business in which to make an investment.

The selection of a charity is a personal choice. There are lots of charities out there. A business should develop a set of criteria for selection.

In selecting the Cancer League of Colorado, I used the following criteria:

·?????? Recognized by the IRS as a 501c3 charitable organization

·?????? Focused on cancer research with some support of other charities that help cancer patients

·?????? Track record since 1969 of success in raising and deploying money toward cancer research

·?????? All volunteer staff

·?????? Great leadership

·?????? Purpose of charity drives leaders and volunteers – not ego

·?????? Highly efficient in converting donations to action (see audit report)

·?????? People I know who are cancer survivors!

There are many flavors of cancer charities based on the type of cancer, the negative impact of cancer, and a large number of charities in memory of lost loved ones. I selected the Cancer League of Colorado because I see the research they are sponsoring has the best chance of making cancer extinct.

I have sat through briefings by top cancer researchers to the Cancer League of Colorado members. Every year the fog of what is cancer is lifting. More knowledge is gained that can find ways to intervene when a cell goes rogue. I see value in this work and believe that my donation is causing positive change.

A business may choose charities based on a decision of leadership or by a vote of the entire team. Some businesses split their donations amongst a few charities. Others use a rotating basis, and a new charity is chosen every year. I favor donating to the same charity every year as a demonstration of consistency which I believe creates greater impact over time and gives the charity some degree of certainty on where next year’s donations may come from.

Entrepreneurs may identify more with a startup charity. However, new charities, like small businesses, have a high failure rate. A charity requires planning and solid operations. It is a cause but must manage itself well. Small businesses may help in this regard with planning, staffing, and facilities to keep expenses as low as possible.

If you have already selected a charity, thank you for your support!

If you are still considering which charity to support, please consider the Cancer League of Colorado.

If you would like to make a donation to the Cancer League of Colorado in support of my Over the Edge fundraiser, you may do so here: https://www.denverovertheedge.com/teams/dakin-capital/

OVER THE EDGE – SUPPORTING CHARITY – PART 1

I have committed for the third year in a row to raise funding for the Cancer League of Colorado through participation in their Over the Edge event. https://www.denverovertheedge.com/

This is a fundraiser for charity.

Charities are often described as filling the gap of human needs unmet by businesses and governments. There can be little doubt there is a gap where too many people find themselves for good reasons and bad.

Like people, some businesses support charities and some do not. Some businesses make a donation, some provide sponsorship in the form of advertising and some volunteer their people and other resources as ‘corporate social responsibility’.

I consider supporting charities an obligation to help my community.

I recommend that businesses adopt a charity. By this, I mean that the business provides so much support to the charity that the brand of the business and the charity is synonymous. Everyone knows that a particular business supports a particular charity and everyone knows that a particular charity is supported by a particular business.

I recommend that businesses contribute a portion of their revenue, not their profits, to the support of their chosen charity. Leaving charitable contributions until after the business has closed their books and declared a profit too often results in little and inconsistent contributions.

I recommend writing the support of a charity into the articles and bylaws, operating agreement or partnership agreement so the commitment is ‘hard-wired’ and not a matter of discretion.

I recommend doing more than simply writing a check. A business should explore all ways that it may be able to help the charity. This may include volunteering time, providing use of facilities, recruiting others to make contributions, or helping the charity tell its story. In many, if not most, cases, a business can provide more value to the charity outside of writing a check. Like any investor, their value is not measured simply in money.

RABBIT HOLES

"Down the rabbit hole" is an English-language idiom or trope which refers to getting deep into something, or ending up somewhere strange. Lewis Carroll introduced the phrase as the title for chapter one of his 1865 novel Alice's Adventures in Wonderland.

The term is usually used as a metaphor for distraction but within the entrepreneur industry it is more often used to describe chasing an opportunity that did not exist in reality.

During the early stage of an opportunity, when it is still no more than a concept, it is altogether too easy to forget that one is working with a concept and start acting like it is a full-fledged opportunity. It is possible to invest a substantial amount of time and money into a concept to see it vanish in the light of full day like a ghost. Worse yet, entrepreneurs have formally started a business, raised funding, and entered the market before realizing how deep in the rabbit hole they are.

Pursuing a concept to determine if it will become an opportunity, is a risk. This is what entrepreneurs do and will continue to do.

The funding point is for entrepreneurs to invest no more time and money than necessary before determining if a concept can grow into an opportunity.

Entrepreneurs should engage in a due diligence review of the concept. Like conducting due diligence of a business, examining a concept is the same but more focused on the fundamentals:

·??????? Can value be achieved?

·??????? Does it (whatever the product or service) work?

·??????? Will customers buy it?

·??????? What talent is necessary to bring the concept to product or service form?

·??????? What other resources are needed (money or things that can be bought with money)?

·??????? Who will oppose or simply ignore the commercialization of the concept?

·??????? When all is said and done, will the outcome justify the investment?

As may be seen from the questions, they all may be answered positively except for the last one, only to realize that this is another rabbit hole.

The entrepreneur must think through to the end of the story before moving forward. Too often, you will hear entrepreneurs making statements that assume market acceptance, that someone else will solve a problem or if only they can get the concept to market that the rewards are so great that they will justify all risks.

The concept should be tested early and often. Each test will increase the knowledge of the entrepreneur and enable them to engage in more rigorous testing. This becomes a delicate dance between reasonable questioning and overly optimistic enthusiasm.

When two or more people are considering the concept, each person should describe carefully their understanding of the concept. The other person should state back to the first person what they thought they heard in their own words. Anything other than a mirror image of each other’s statement provides grounds for more discussion.

Entrepreneurs should draw upon the experience of other, more seasoned entrepreneurs. However, even this practice must be implemented with care. Experienced entrepreneurs may now be too successful, too paranoid (some is good, too much is bad for this activity), or not in a position to add valuable advice.

Like an investor evaluating an investment opportunity, an entrepreneur should take the time to thoughtfully develop their own criteria for consideration of a new concept.

MORE THAN ONE PERSON

Entrepreneurs are recognized in the media for their solo accomplishments. Such stories are either lies or anomalies. A single person represents a combination of talents based on their experience and skills. A single person has a network of contacts. A single person has a limit of funding. Therefore, a single person has a limited range and scope of capability.

Few opportunities can be achieved by a single person because of these limitations.

More opportunities can be achieved by building a team. Even more with a strong board of directors or managers. And yet more can be achieved with a comprehensive board of advisors. Ultimately, the most can be achieved with a community who is working toward a common cause.

Some opportunities cannot be realized with anything less than a large support group or community.

Every strategy toward raising funding has as its foundation the development of as many relationships as possible that will support the goals of the individual or organization seeking funding.

The basis for the relationship is a common outcome. Without this commonality, there is no reason for anyone to provide support.

Good fundraising practices seek out and define these outcomes so that the pitch will include a clear statement that the outcome will be achieved.

FIRST DOLLARS ARE THE HARDEST

It is a well-known adage in raising funding that getting that first investment is the hardest.

There are several reasons why this is true. No one likes to be the first to take on an investment risk unless the investment is intended to present the investor in a positive light. In such situations, the quality of the investment and all of the other factors commonly considered in making investment decisions are secondary to factors of prestige.

Investors who invest early are commonly referred to as ‘cowboys.’ This characterization may be viewed as either positive or negative.

In a positive sense, an early investor is a risk taker. Some people like this label and work to achieve it.

In a negative sense, an early investor may be considered a fool who will soon be parted from his money.

It is also possible that these people may be goaded into investing by pressure from their peers.

A small business seeking to attract this type of investor candidate would style not only the offer, but the business as matching this personality.

These same people may engage in skydiving, rock climbing or other activities where adrenalize is the drug of choice. Investment pitches look more like parties than briefings.

Early investors often invest from a large pool of discretionary money that they can afford to lose. The investment will not be made with their last dollar like a gambler laying their last bet.

The alternative approach to finding an early investor is to seek a strategic partner who can see a path to advancing their own mission or fortune through an investment. Seeking investment from these investor candidates follows more common funding activities.

UNBUNDLING

Too often, investment opportunities are a bundle of existing and potential benefits. This would appear to be a good thing in that the value should be greatest. However, value is in the eye of the beholder. What is valuable to one person may not be to the next. What one entrepreneur may make into a large fortune, another entrepreneur may loose all of their investors’ money.

It is sometimes necessary to unbundle an opportunity so that it more precisely matches the entrepreneur and prospective investors.

An entrepreneur will seek to realize the opportunity but must be careful not to take on too much too soon. Likewise, investors will invest in what they know and attribute little or no value to parts of an opportunity that they know nothing about or about that they don’t care about.

Intermediaries may benefit from trying to maximize the size of an opportunity in order to earn larger commissions, but the focus should be on maximizing the probability of success from which both the entrepreneurs and the investors may claim victory.

When identifying investor candidates, it is recommended that all stakeholders be included who may benefit from the success of the business. Benefits may be monetary or non-monetary, direct or indirect in both quantity and quantity. It is common to identify two or more groups that stand to gain significant benefits. These differences provide a framework for unbundling an investment opportunity.

As an example, a business may want to raise funding to construct a new building. Funding will be used to buy land, engage contractors, and buy materials. Investors stand to make a return on their investment that meets their criteria. However, the minimum materials used to complete construction of the building may result in greater energy consumption and higher utility bills in the future. Tenants of the building will bear these costs over the life of the building through triple net leases. A prospective tenant may want to invest in the building in order to improve operational efficiency with better environmental efficiency. This investment may result in certain tax benefits that can be passed through to the tenants. The tenant investment may also reduce the amount of money made by the original investors, resulting in a higher ROI. Alternatively, the government may want to help the environment by incentivizing high-energy efficiency buildings or installing energy generation equipment. This may come in the form of tax increment financing, PACE financing, tax waivers, or other support that may decrease costs, increase revenues, or decrease taxes.

Within a capital stack, different types and sources of funding can achieve the goal of funding a project that might not be successful when presented as a single opportunity.

SUCCESSFUL FUNDING

LAST TUESDAY, Ron Yeager was my guest on the Successful Funding show. We discussed funding campaigns that worked and those that did not work. Establishing a quality relationship with investors and keeping them informed during good times and bad both made and saved investments.

You may see a recording of the show at:

https://www.dhirubhai.net/events/successfulfunding-ronyeager-wha7233879237168877570/theater/

You may view recordings of all past Successful Funding shows at my LinkedIn profile under Events:

https://www.dhirubhai.net/in/karldakin/

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.

LAST THURSDAY, RCI Community Funds, Benefit LLC presented the Community Revitalization show. Our featured guest was Devin Thorpe of Super Crowd. An accomplished businessperson and entrepreneur, Devin founded Super Crowd to advocate for impact investing in small businesses using Reg CF investment crowdfunding. We talked about the positive impact of investing in small businesses, which helps rebuild disinvested communities.

You may see a recording at:

https://www.dhirubhai.net/events/communityrevitalization-devinth7234305157730091008/theater/

DON COHEN SHOW

LAST WEDNESDAY, I was a guest on Don Cohen’s show where we talked about ‘cooperation.’ We were digging into the need for cooperation when seeking to do anything more than the capabilities of a single person. Cooperation is a matter of give and receive (not take) where each participant is working towards a common goal. We experienced an Internet disconnect and our show was brief.

You may see a recording of this abbreviated show at:

https://www.dhirubhai.net/events/8-28thefundingeventfeaturingkar7232776222806593536/theater/

Don is my mentor and guru on using LinkedIn as a social media platform to build my brand and build my community of individuals and organizations who work like me to help small businesses and communities raise funding.

Donald Cohen

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Karl Dakin, the Capital Coach

Dakin Capital LLC

[email protected]

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