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    4 Replies Latest reply on Jul 3, 2008 2:21 PM by Lighthouse24

    Need Suggestion on Financial Mistake

    f15radar Newbie
      Hi. First I am going to apologize for this being long winded, but I want you to know my story and understand what I am going through. First I currently own a "Wireless Internet Service Provider" (WISP) company. My Company has been in business for 15 years. We made it thru the tough times before but this time things are different. Before becoming a WISP, I was only an ISP with a software development company which did business with the government. As a dial-up company, I realized in 1997 that High Speed competitors were around the corner and proceeded to find a competing technology that would keep me in business. The technology was wireless, however, the equipment was poor back then. In 2003 I found what looked to be a good solution. I took what little R&D money I had and bought the equipment. I put up an experimental network and it worked flawlessly. However, I was competing with a large corporation who was threatening to bring a new wireless technology into the market. I took my prototype and made it live in August of 2003. I was the first and the other company did not come in, so I am still the only one there. It only covers about 1 square mile so it was not very profitable. Still with limited resources and dial-up customers leaving with promises to come back if I could provide high speed I was heading for trouble. My software business was flourishing, so I decided to keep putting money into the business and wait till I had enough money to expand. Well that never happened. In early 2007, the government decided that they wanted what was called 8a businesses to do the software work and my company did not qualify for 8a. So here is where I made my first mistake. I decided to take the prototype wireless network to a very rural area and do what other WISPs were having a hard time with. I should not have used my money, but went for a loan then. Well I didn't because I wanted to show any potential investor/bank that I could make the technology work and then once I did that and got about 50 customers in an area that could only get dial-up, then there would be money available from someone to expand. In the meantime I started to get about 10 calls a day which continues even today for me to expand the first network. I couldn't expand it because I had used all of my funds buying equipment. My wife and I worked feverously to get the network up and running and serving more than just a few miles but hundreds of miles of shoreline on a rural lake. Again it worked flawlessly. But this is not a fairy tale ending. I have exhausted our money in building this network and therefore do not even have any advertising dollars left. We need to expand and advertise to get more customers and without more customers we are heading for crash and burn. My FICO score is good, but I am using 53% of my revolving debt. I have no more money to put into the business and cannot supplement it with software work at the base. I have a complete updated business plan with projected financials showing very good returns. I do not do enough in Credit Cards so I have been asking around about loans and either my 53% gets me or because I didn't bring in the 120-150K last year so no one will look at me. I'm at the point where I may have to shut down the business and take some credit hits because I signed 3 year agreements for bandwidth that I can no longer afford unless I can get my subscriber base up. Does anyone know the steps I can take to recover from this or am I just doomed to losing the business and going back to work for someone else?
        • Re: Need Suggestion on Financial Mistake
          dtominus Wayfarer
          I may be able to help. how much are you doing monthly ,

           

          Please contact me , lets Talk about a solution !

           

           

          David Tominus
          727-45-9530
          • Re: Need Suggestion on Financial Mistake
            FCPainter Adventurer
            I apologize in advance because I do not know your business, but I would make 3-4 general suggestions. a. I would do a lot of research online to see what others in your business are doing/saying to see if you can steal good ideas from I noticed 2 interesting articles in about 3 minutes of searching http://blog.mlive.com/chronicle/2007/12/f
            irm_plans_wireless_internet_f.html and http://articles.directorym.net/Bringing_W
            ireless_to_Rural_Areas_Washington-r885521-
            Washington.html

            b. would the local chamber of commerce or other business groups care about your situation. could you go in and pitch them on the idea of getting all their members to sign up to use your service until you can get on your feet and/or could they all promote your business to your customers? I get that there is a public service play to what you do - offer this great service to people who have been left off the grid. maybe you can save your company with PR and hustle

            lastly, have you considered partnering with another player in your field. could you get yourself acquired or merge with someone?

            good luck - wish i knew your business
            • Re: Need Suggestion on Financial Mistake
              Bridge Navigator
              Just curious:

              1) How many total potential customers in your current coverage area?
              2) How many customers do you have?
              3) How many do you need to be profitable?
              4) What do you charge per month?
              • Re: Need Suggestion on Financial Mistake
                Lighthouse24 Ranger

                You don't say where you're located, but you do mention "rural" -- so here's one "outside-the-box" possibility: Focus on how the customers you'd gain from expansion would use the technology (i.e., what benefits or valuable things would they gain as a result of access they don't have now).

                Let me share an actual example of how and why that might help. A few years ago, one rural area of Texas was served only by dial-up and a small (local) wireless company with limited coverage. Most of the small towns within the region had no public library (or only a very limited one), and students had only dial-up access to the Internet (if that) from home -- so local schools were interested expanded wireless coverage. High school graduates and working adults who wanted to take college classes had to drive as far as 95 miles to the nearest campus, and they had no way to take on-line courses, participate in teleconferences with their advisors and professors, etc. -- so the state university system got interested in a technology solution. The U.S. Congressman for the region had a district that covered over 52,000 square miles (compare that to just over 1 square mile for some of the more densely populated Congressional districts in New Jersey) -- so he was keenly interested in how technology could be used to help him meet on-line with constituents. A high profile business magnate was interested in buying groundwater rights and building a pipeline system in the same area, and he wanted a way to hold a series of on-line town hall meetings to pitch his ideas to landowners. A rural electric cooperative saw an opportunity to address environmental or regulatory questions without holding live hearings or doing mass mailings. An evangelical preacher from a large church in a major city (that was already streaming church services) saw an opportunity to reach out to a new congregation.

                Basically, enough people with "influence" in a variety of areas, and access to money (including grants), got interested in solving the problem -- because they all had something they wanted to put in the hands of those rural customers.

                Perhaps that example will trigger some ideas to address your problem . . .

                FYI, I was brought in to provide "neutral" content (a management training program) for the pilot expansion, so that's why I know a little about this. A couple of years later, a rapidly expanding regional telecommunications provider bought out this small firm. (I've heard that the owner did alright!)

                Hope this helps. Good luck!