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    6 Replies Latest reply on Mar 10, 2009 3:39 PM by shodges439

    Send me an Angel........

    dimmech Newbie
      Hello everyone, my name is David and I am the owner of a sales and manufacturing company that produces a niche product. I have been in business for almost 5 years and the market for my product is still very strong. There are many factors that bring us to our current position but I will only highlight the most relevant in an open forum such as this.

      First, I'll start by respectfully preempting you Luckiest. I have an Accountant, Lawyer and investor ready business/marketing plan. I am very familiar with S.C.O.R.E. and have benefited greatly from my experience with the local chapter. Still, I look forward to any response you might have for me after reading this post.

      I have invested everything I have to this point. My personal credit is virtually non existent because I've always paid cash for everything as a result of watching freinds and family bury themselves in debt using credit. There are 2 minor items listed in my report that I am currently disputing. I can eliminate them both for under $1000 but these items are not mine and I refuse to pay debt I did not aquire. Besides, I don't think it will help matters much because the only other thing on the report is a car I paid off on time. In other words, I don't have a bunch of revolving accounts and I do not own a home. Although I am not a candidate for a loan though my current bank, the branch manager has been a big supporter in other ways. The following is an excerpt of a very recent email to one of his banking clients that I hope will pan out for us(edited for personally identifying content)

      "I have a client, who I've known for several years that has a business and is looking for some capital to bump up advertising and purchase machinery that's vital to this line of work. I've given them a line of credit of $25K and also maintain their bank accounts here at "_____" Bank. They've always paid as agreed and have maintained a very professional relationship with me.

      I talked to him this morning and he asked if I new of anyone who might be looking to partner with him and assist him with what he's trying to do. He's been in business for 5 years and has managed to keep things going (despite the current state of the economy) and what's even more impressive is that the company has very little debt.+

      I've actually used him for several personal and bank related projects and I really stand behind what they do. It's a pretty cool concept that I feel truly lacks proper backing.

      Here's his website. www."________".com

      I'm only doing this as a favor to him and outside of a banking relationship, I have no personal involvement with him or his company. Let me know if you are interested in talking to him."

      The 25k mentioned here was a loc to the company not based on personal credit. Although my banker would like to help us out he can't because of my credit picture and no collateral to speak of. So, here I am.

      Without getting into too much detail here I must also mention that my company has not yet posted a profit. There are very justifiable reasons for this, mostly due to our lack of proper mass production capabilities and other inadequacies that can be remedied with the funding of our plan.

      We are seeking 850k in the form of a loan, loc or both. As I am new to procuring funds in this manner I am not certain as to what a fair return would be in this situation as described (advice here would be appreciated). I am willing to explore some equity scenarios but do not wish to give over controlling interest.

      My product is a revolution in it's market and chances are that many here can and will use it. There is so much more to this company than meets the eye and my hope is that someone here will take the interest and help us build a legacy.
        • Re: Send me an Angel........
          dimmech Newbie
          It has been a week and no response at all from anyone. Should I be reading into that? Can anyone offer me direction? Suggestions?

          Thanks,
          David
          • Re: Send me an Angel........
            dtominus Wayfarer

            What is your product , what forms of payment do you receave , I may be able to help
            please contact me

             

            David Tominus

             

            727-545-9530
              • Re: Send me an Angel........
                dimmech Newbie
                David, Thanks for your response. It appears as though you loan against credit card sales. I am looking to fully fund an expansion and our current numbers ( I assume the loan amount is calculated using a multiplier of current sales) do not support a loan of the magnitude sufficient to carry out the plan. Most of theses types of loans (as I've seen them) are usually factoring say up to 150% of the average monthly sales for the last 4 months. Please correct me if I'm wrong, but this does not seem like a viable option for us. I am also being intentionally vague with regard to the product I manufacture as it would serve to identify my company and I wish to privately disclose this information to potential investors.
              • Re: Send me an Angel........
                Tracker
                Hi David,

                Without credit & collateral to get debt based funding, the only avenue you have is to try to raise it is by selling equity. if you have a good investor-ready business plan you should look at using it for the basis to have your attorney prepare a Private Placement Memorandum. Also known as a PPM this is the document that covers all the legal aspects of raising capital from from private investors by selling them stock (and sometimes bonds, which are often convertible to equity). Check with your attorney about a Reg D PPM filing; the costs etc. Also, you might ask your banker what they think about you doing a Private Placement ... they may know of investors in your area that would be interested in your opportunity once you have your PPM in place to present to them.

                I hope that gives you a direction to explore with your attorney, Best of luck to you.

                Dennis Lowery
                Adducent, Inc.
                • Re: Send me an Angel........
                  snipperred Scout

                  Hi there, I'm new. Please excuse any inconsistency with the general tone of this board. That's an interesting blind study ;) It sounds like your question has been appropriately addressed. Good luck!

                  I had some thoughts I thought I would share for whatever they are worth to you. I am obviously not an expert like the impressive community here.

                  I can relate to your perspective on credit. Because of this I bet you might be equipped to grow your business without the financing. If your product is in higher demand than you have the capacity to fill and has sustained your business without incurring debt thus far, perhaps you are not charging enough for it.

                  If the product itself is so proprietary then you might be more targetted in your marketing. If it was, glow-in-the-dark nuts (and bolts) for example, then whoever could benefit from it the most in terms of competitive advantage should be explored- maybe race car teams for example. Positioning it based on industrial utility in a competitive environment might allow you to let the market dictate price higher i.e. bidding, support the development of proprietary growth/ development relationships with contracted end-users, or serve advertising interest where the advantage of the product speaks for itself.

                  I personally like to be worth what I have rather than acquire debts- if it turns out to be a matter of necessity then I think you can feel confident in where you are at. You must be lean already; but if you haven't already scrutinized your waste I recommend The New Manufacturing Challenge by Kyoshi Suzaki as a good read. In particular, mass investment for mass capacity may not be necessary for you. From what you provided, it sounds like your margin of profit to loss could be optimized and you could grow incrementally as needed. that seems to be a pretty intelligent manufacturing methodology these days. Besides, if the market for your niche product changes from strong to weak then imagine what you would likely be left with- major debt and production capacity not adding value and probably not portable to other manufacturors.

                  Obviously, if you can turn around investment into your company while the market is hot, then it's an opportunity you might want to promote in the investment market. If you have a long-term durable advantage to exploit by getting an early foothold in the market, you might think about dropping a line to Warren Buffet.
                  Hope my comments are taken for motivation and not insulting. Once again, good luck!
                  • Re: Send me an Angel........
                    shodges439 Newbie
                    Your thread came up to the top of the list. Are you still seeking funding? If so please contact me shodges439@gmail.com I have someone who would be interested in speaking with you.