Tag Archives: venture capital

Money talks – Day 106/139

Today, I had the opportunity to present FinderBase to a couple of professional investors. Much of our talk was around the business potential of our service.

People tend to over-complicate the talk about money.

I will argue that there is only one right way to talk about money.

  • It is not the way of worshiping the money. You shouldn’t respect big numbers more than small ones.
  • It is neither the way of disrespect. You should respect the people with money just like you respect anybody else.
  • The right way is the neutral way. Money is just money. Numbers on the bank.

So we opened the discussion with the obvious. I said our company is worth 1,8 M€.

Considering that FinderBase.com has only had a handful of paying customers and has less than 300 registered users, the price might sound a bit extreme.

But they listened to what I had to say.

They had good suggestions on what we’d need to do next, most of which we already had executed. They asked whether we allowed bigger investments from a single party and I told them that was negotiable.

This is the way I’d like investor meetings to go.

Neutral about money. Passionate about business.

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Abetti’s pizza principle – Day 100/139

I have been now writing this blog for 100 days. There have been ups and downs but my project is still standing.

But where is the money?

For some weird reason people keep asking me this. To show where the money is, I’ll quote my favorite professor Pier A. Abetti:

Think of companies like pizzas. Your startup is a whole mini pizza that you own. When you sell a part of it, the pizza becomes bigger. Would you rather own a whole mini pizza or a slice of the bigger pizza?

The lesson here is that the small slice of a bigger company tends to be worth more than the whole smaller company.

So the plan is this:

  • We have founded a company FinderBase Oyj that owns the FinderBase.com service.
  • We will arrange an issue of shares for FinderBase Oyj.
  • We will offer the shares to people who trust us and want to be a part in building a big phenomenon.
  • This will dilute our own ownership but will grow the company.

Would you be interested in getting our investor brochure?

Money maker’s dilemma – Day 99/139

Making money is really easy. Like the saying goes:

The easiest way to become a millionaire is to start with two million and buy an airline company.

The truth is that money tends go where there is money already. Making your first million is undoubtedly more difficult than making your second one.

But it isn’t just money that money is after.

Let’s assume that we have two equally skilled businessmen who would like you to invest your money in their new venture:

  1. The first one is broke.
  2. The second one is not only broke but he has a million in debt.

Which investment offer is more credible?

I will argue that a history of huge losses is more credible than a history of small profits.

The numbers don’t lie. People do.