Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “Business 101: Be Liquid!”
As the Global Marketplace experiences disruptiveness and turbulence, the entrepreneurs of tomorrow will have to revert back to the business basics and come up with new formulated models that will sustain their businesses. Over the years a number of business owners have taken the good times for granted and failed to develop a long term strategy for their business and did not incorporate the ‘bad economical times’ in their thinking.
One of the key concepts that need to be addressed very effectively in everyday dealings is that of being liquid. Majority of the banks are not lending and have restricted to only a certain arena, this creates a challenge for small business owners since they gamble on these financial institutions for products such as working capital loan, lines of credits to even short term loans. Most of these businesses are not liquid enough to sustain a long term financial turmoil and that is one of the reasons we are seeing a hike in the bankruptcy filings amongst the small businesses.
In order for us to come out strong out of this recession, we will need to restructure our business, and first and foremost, our mindset. We will need to address every line item on our financials from top to the bottom and conqueror it. These business owners have worked very hard to get to the point where they are today, perhaps even 3-4 generations worth of work. So, the key element is to be liquid and treat every expense or liability to the businesses as a self sustaining entity. Take your accounts receivables, if you simply shorten the number of days of outstanding, this will take care of the cash flow without much work. All the new terms need to be re-evaluated and perhaps even new guidelines and terms need to be prepared.
As Charles Darwin coined “survival of the fittest”. Well, this applies to the current economic cycle we are seeing on the global scale. Perhaps not so severe in other countries but we will need to not only survive but emerge with our head up high and capitalize and position our entities so that they are in a position of financial gains and not loss. As a businessman you have come a long way and I respect that and all the hard work you have put in, but don’t stand alone. You will need to bring in professionals who can assist you to overcome your short term challenges and to re-strategize and help you move forward with more ammunition. The current economic cycle we are in right now, cannot be looked at as times of bad economy, rather times of plenty of opportunities. This is the very time to be profitable and grow. So be pragmatic and prudent in your dealings and get ready to grow your business like never before!
My Thoughts: You are 99% there, what is another 1%!
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Wednesday, September 9, 2009
Tuesday, September 8, 2009
Venture Capital / Investor: Prepare your Pitch!
Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “Venture Capital / Investor: Prepare your Pitch!”
At Waterbury Financial Strategies Inc, we see an average of 900 proposals a month that are seeking funding from various different sectors and industries not to mention the spread in demographics. As the Venture Capital world is experiencing some major shift in paradigm, the numbers of deals that are being funded are much less compared to previous years. I have seen innumerous business plans and proposals. They all have one thing in common: hockey stick projections with no methodical and definite supporting references.
If you make it through the first round, be prepared for a cohesive and structured round where you will need to know each and everything you are talking about and you will be asked to provide supporting documentation to back up your figures and data. Should you fail to present it accordingly, you might not be invited to come back.
I would advise you to learn your material very well and present it in a very professional manner because the last thing the investors want to think is you are not respecting their time when you come unprepared. Own your project and idea! From the day you get the idea, you need to dream it and make it into reality and believe in its existence. Remember, the VC look at very many projects and come across individuals from various different industries. If there is a slight hesitation on your end, they will read you in matter of minutes. And sometimes it is ok not to have every answer, but follow up is the key!
One key element that most of the proposal lack is the economic cycles. You have to show value in your concept and how you are going to steer through a financial crisis. Many of the financial projections are based on simple forecasting methods during good times and not bad. A proper valuation needs to be performed and thoroughly addressed both from the financial standpoint as well as business development. One of the red flags is the compensation factor. Are you awarding yourself and your team a fair compensation? Many times it is frowned on when we see a huge salary for the CEO, and this just doesn’t jive.
I will follow up with a detailed breakdown of how to prepare and what needs to be addressed in the proposal to be a success! So keep reading.
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
At Waterbury Financial Strategies Inc, we see an average of 900 proposals a month that are seeking funding from various different sectors and industries not to mention the spread in demographics. As the Venture Capital world is experiencing some major shift in paradigm, the numbers of deals that are being funded are much less compared to previous years. I have seen innumerous business plans and proposals. They all have one thing in common: hockey stick projections with no methodical and definite supporting references.
If you make it through the first round, be prepared for a cohesive and structured round where you will need to know each and everything you are talking about and you will be asked to provide supporting documentation to back up your figures and data. Should you fail to present it accordingly, you might not be invited to come back.
I would advise you to learn your material very well and present it in a very professional manner because the last thing the investors want to think is you are not respecting their time when you come unprepared. Own your project and idea! From the day you get the idea, you need to dream it and make it into reality and believe in its existence. Remember, the VC look at very many projects and come across individuals from various different industries. If there is a slight hesitation on your end, they will read you in matter of minutes. And sometimes it is ok not to have every answer, but follow up is the key!
One key element that most of the proposal lack is the economic cycles. You have to show value in your concept and how you are going to steer through a financial crisis. Many of the financial projections are based on simple forecasting methods during good times and not bad. A proper valuation needs to be performed and thoroughly addressed both from the financial standpoint as well as business development. One of the red flags is the compensation factor. Are you awarding yourself and your team a fair compensation? Many times it is frowned on when we see a huge salary for the CEO, and this just doesn’t jive.
I will follow up with a detailed breakdown of how to prepare and what needs to be addressed in the proposal to be a success! So keep reading.
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Federal Deficits keeps soaring and prolongs Recession.
Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “Federal Deficits keeps soaring and prolongs Recession”
As the Federal Deficits soar, it puts our economy in a perplexing position amongst the foreign investors who are holding these notes and are reluctant to offer any further resources regardless of zero default by the federal government. The question they face with, whether the US can service its debt not to mention the ticking time bombs, the Medicare and Social Security. The federal revenues also keep declining based on a various external factors such as loss of jobs which restricts the consumers to spend money which in return lowers the sales tax. There is also a formidable struggle for the local businesses as the bankruptcy filings have gone up to almost 62% reflecting 55,000 business filings.
The small businesses account for 70% of the employment and we don’t see any funds allocated in the stimulus package. Well, if you studied economics you would know that there are two distinct possibilities for the government to pull out of this recession. First, the government increases taxes through which they can increase their revenues to recoup and offset all that spending. Even with that being said, this would be a challenge simply due to the nature of the current financial system being in a chaos. A number of businesses are already paying taxes in excess of 50% when combined with federal employment tax, social security, state taxes, federal, sales tax, etc.
Second option for controlling the recession would be by simply printing money as the gold standards are not applicable. This will simply create inflation and also raise the prices and devalue the dollar. Based on the current rate that the Federal Reserve is printing money, we will see a huge drop in the dollar valuation in the upcoming 12-18 months. This would perhaps be the most favorable option for them due to simple economics. When you are in inflation, the dollar is devalued and the prices go up. Once the dollar is devalued, the government collects more money quickly. However this is also a very risky game especially for foreign investors. Not only we will be in inflation but the Federal Reserve will need to pull all that money back, so we are caught in a catch 22. After all, we do not want to end up like Zimbabwe with inflation rising exponentially.
This is perhaps the very reason why the foreign investors are concerned with the current state of the US Economy and not knowing which way the current administration is going to turn to overcome this recession. We are already seeing the government burdening the new generation with exorbitant debt and obligations, what is going to be next? The Chinese have been proposing of an idea to use a global currency system to replace the dollar. If that happens, not only are we going to lose the upper hand in the global arena but also in the Oil trading platforms and currency. We just took a back seat this week based on a report out of Geneva, Switzerland that American is now the 2nd most competitive economy in the world after Switzerland.
My Thoughts: Make wise investments and possibly diversify your holdings in a Global Market. Position your companies so that they are on the gaining side and not losing. All the best Men!
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
As the Federal Deficits soar, it puts our economy in a perplexing position amongst the foreign investors who are holding these notes and are reluctant to offer any further resources regardless of zero default by the federal government. The question they face with, whether the US can service its debt not to mention the ticking time bombs, the Medicare and Social Security. The federal revenues also keep declining based on a various external factors such as loss of jobs which restricts the consumers to spend money which in return lowers the sales tax. There is also a formidable struggle for the local businesses as the bankruptcy filings have gone up to almost 62% reflecting 55,000 business filings.
The small businesses account for 70% of the employment and we don’t see any funds allocated in the stimulus package. Well, if you studied economics you would know that there are two distinct possibilities for the government to pull out of this recession. First, the government increases taxes through which they can increase their revenues to recoup and offset all that spending. Even with that being said, this would be a challenge simply due to the nature of the current financial system being in a chaos. A number of businesses are already paying taxes in excess of 50% when combined with federal employment tax, social security, state taxes, federal, sales tax, etc.
Second option for controlling the recession would be by simply printing money as the gold standards are not applicable. This will simply create inflation and also raise the prices and devalue the dollar. Based on the current rate that the Federal Reserve is printing money, we will see a huge drop in the dollar valuation in the upcoming 12-18 months. This would perhaps be the most favorable option for them due to simple economics. When you are in inflation, the dollar is devalued and the prices go up. Once the dollar is devalued, the government collects more money quickly. However this is also a very risky game especially for foreign investors. Not only we will be in inflation but the Federal Reserve will need to pull all that money back, so we are caught in a catch 22. After all, we do not want to end up like Zimbabwe with inflation rising exponentially.
This is perhaps the very reason why the foreign investors are concerned with the current state of the US Economy and not knowing which way the current administration is going to turn to overcome this recession. We are already seeing the government burdening the new generation with exorbitant debt and obligations, what is going to be next? The Chinese have been proposing of an idea to use a global currency system to replace the dollar. If that happens, not only are we going to lose the upper hand in the global arena but also in the Oil trading platforms and currency. We just took a back seat this week based on a report out of Geneva, Switzerland that American is now the 2nd most competitive economy in the world after Switzerland.
My Thoughts: Make wise investments and possibly diversify your holdings in a Global Market. Position your companies so that they are on the gaining side and not losing. All the best Men!
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Monday, September 7, 2009
Which Businesses qualify for a Negative Interest Rate Loan in the Stimulus Package?
Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “Which Businesses qualify for a Negative Interest Rate Loan in the Stimulus Package?”
Fellow Entrepreneurs I hope I have captivated your interest for the next few minutes. Yes you read the headline correctly. The so called negative loan is called Cost Segregation. This is simply an IRS approved methodology to depreciate the components of a building that an enterprise or investor owns according to its logical progression based on its shelf life. In order for the IRS to accept this study, it has to be performed very carefully and with thorough understanding of not only materials engineering but IRS guidelines and proper depreciation models. This study is generally performed by engineers and architects. This study yields proper depreciation figures both from previous years as well as future. A business can recoup all the overpaid takes since the acquisition of the building and can apply towards future tax credit.
What are the benefits of this study and cost associated with it? Well, there are a number of benefits from creating additional cash flow for businesses especially with the current economic situation we are facing; this would definitely be an option for business as many of them are not liquid enough to sustain their daily operations and perhaps future may seem bleak. There are other benefits such as reducing your insurance premiums in certain cases to even freeing up cash for other investments. Generally the return is phenomenal, anywhere from 1000% and upwards.
A recent study that was performed by Waterbury Financial Strategies’ Cost Segregation Department on a chain of 47 Motels yield $37.6M in tax benefits. This is almost like buying 7 motels at $5M each! Well, and the group that owned these motels, did just that. The engineers are Waterbury Financial Strategies Inc have performed over 15,000 studies some including the Fortune 500 Companies and crediting in excess of over $2 Billion to the clients.
So, why are more companies leaving ample money on the table? Over 80% of these companies have not heard of Cost Segregation and their accountants do not have the knowledge and expertise to perform these studies. Most of the accountants who perform these studies generally outsource to a professional engineering firm. A simple example of how it works. Generally when a commercial property is purchased, the fixtures and the building is depreciated using a straight line depreciation method over 39 year time period. This means all the components in the building are now on a 39 year life cycle. As you know, a carpet in a building is not going to last for 39 years, so come 5th year when the owner replaces the carpet, he still has 34 years to recoup the cost from the previous carpet. That means he is over paying on his taxes and not figuring out the time value of money.
Using proper methods can not only save a business hundreds of thousands of dollars but also generate more revenues and cash flow. For more information on this contact your local consultant at Waterbury Financial Strategies for a Free Preliminary Analysis on your property.
Get those Refunds back Wise Men!
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Fellow Entrepreneurs I hope I have captivated your interest for the next few minutes. Yes you read the headline correctly. The so called negative loan is called Cost Segregation. This is simply an IRS approved methodology to depreciate the components of a building that an enterprise or investor owns according to its logical progression based on its shelf life. In order for the IRS to accept this study, it has to be performed very carefully and with thorough understanding of not only materials engineering but IRS guidelines and proper depreciation models. This study is generally performed by engineers and architects. This study yields proper depreciation figures both from previous years as well as future. A business can recoup all the overpaid takes since the acquisition of the building and can apply towards future tax credit.
What are the benefits of this study and cost associated with it? Well, there are a number of benefits from creating additional cash flow for businesses especially with the current economic situation we are facing; this would definitely be an option for business as many of them are not liquid enough to sustain their daily operations and perhaps future may seem bleak. There are other benefits such as reducing your insurance premiums in certain cases to even freeing up cash for other investments. Generally the return is phenomenal, anywhere from 1000% and upwards.
A recent study that was performed by Waterbury Financial Strategies’ Cost Segregation Department on a chain of 47 Motels yield $37.6M in tax benefits. This is almost like buying 7 motels at $5M each! Well, and the group that owned these motels, did just that. The engineers are Waterbury Financial Strategies Inc have performed over 15,000 studies some including the Fortune 500 Companies and crediting in excess of over $2 Billion to the clients.
So, why are more companies leaving ample money on the table? Over 80% of these companies have not heard of Cost Segregation and their accountants do not have the knowledge and expertise to perform these studies. Most of the accountants who perform these studies generally outsource to a professional engineering firm. A simple example of how it works. Generally when a commercial property is purchased, the fixtures and the building is depreciated using a straight line depreciation method over 39 year time period. This means all the components in the building are now on a 39 year life cycle. As you know, a carpet in a building is not going to last for 39 years, so come 5th year when the owner replaces the carpet, he still has 34 years to recoup the cost from the previous carpet. That means he is over paying on his taxes and not figuring out the time value of money.
Using proper methods can not only save a business hundreds of thousands of dollars but also generate more revenues and cash flow. For more information on this contact your local consultant at Waterbury Financial Strategies for a Free Preliminary Analysis on your property.
Get those Refunds back Wise Men!
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Assisted Living Facilities: The Redefined Powerhouses of the New Economy?
Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “Assisted Living Facilities: The Redefined Powerhouses of the New Economy?”
Every year thousands of golden agers Americans migrate to their new homes, the assisted living facilities and are left to spend the rest of their lives to play tennis and socialize amongst other retirees to start all over again. Should the younger generation be attentive to this elite breed of what is commonly referred to as the baby boomers?
After all who are these retirees and just how are they contributing to the current neoteric society? Just how have they enriched the American Culture and humanity in general? I call them the powerhouses of the future of America. These men and women are so strong willed that they can take on a project from start to finish and foster entrepreneurship all over again. These are the same individuals that where pioneers in the field of technology, manufacturing, healthcare, etc. A number of these individuals posses so much endurance and determination that they can surpass the energies of recent Ivy League graduates, no offense grads. It is the passion and enthusiasm that keeps them going day in day out. These retirees have a resume full of countless hours of experience and hard work; they have scars on their bodies to prove their contribution to the creation of wealth for many generations.
The current financial models are more complex and intricate then what has been capitalized in the past, however as we know most of the models are simply build on the old models. We need to replicate older models and build on them and go back to the basics. Wisdom is no longer part of the equation in many entities and destructiveness is being embraced which in return creates a so called short term positive aftermath. However at what cost are we forfeiting our values, morals, ethics, and business practices? These men are fine breed, or like a fine wine that is ready to be enjoyed. We need to get in front of these men of honor and do some serious note taking. We need to implement on their thoughts and ideas. Perhaps transfigure a little so that they may fit into our economic engine and replicate it into much broader spectrum, such as the countries with emerging economies. So much wisdom is stored into these men, and one of the factors that need to be part of merit is the piece of golden advice.
My Thoughts: The system these men put together a number of years ago was of an individual going to work every day working for one company for their lifetime and retire with a pension. What happened to that delicate system? Was this system driven out of business for us to create a New Economy for us? Well, the economy is so volatile in the current times that things change in microseconds and not days. So, we will either need to stay a step ahead of the technology. So, let’s pick up a note pad and head to these assisted living facilities, call grandparents to not only learn about their experience but also to ask some questions as to what would you do if you were in your 20s? So men and women of this great nation, all the best, I would love to hear some of the responses you get. On your way to the assisted living facility, pick up an old fashioned ice cream for them as well, they deserve it.
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Every year thousands of golden agers Americans migrate to their new homes, the assisted living facilities and are left to spend the rest of their lives to play tennis and socialize amongst other retirees to start all over again. Should the younger generation be attentive to this elite breed of what is commonly referred to as the baby boomers?
After all who are these retirees and just how are they contributing to the current neoteric society? Just how have they enriched the American Culture and humanity in general? I call them the powerhouses of the future of America. These men and women are so strong willed that they can take on a project from start to finish and foster entrepreneurship all over again. These are the same individuals that where pioneers in the field of technology, manufacturing, healthcare, etc. A number of these individuals posses so much endurance and determination that they can surpass the energies of recent Ivy League graduates, no offense grads. It is the passion and enthusiasm that keeps them going day in day out. These retirees have a resume full of countless hours of experience and hard work; they have scars on their bodies to prove their contribution to the creation of wealth for many generations.
The current financial models are more complex and intricate then what has been capitalized in the past, however as we know most of the models are simply build on the old models. We need to replicate older models and build on them and go back to the basics. Wisdom is no longer part of the equation in many entities and destructiveness is being embraced which in return creates a so called short term positive aftermath. However at what cost are we forfeiting our values, morals, ethics, and business practices? These men are fine breed, or like a fine wine that is ready to be enjoyed. We need to get in front of these men of honor and do some serious note taking. We need to implement on their thoughts and ideas. Perhaps transfigure a little so that they may fit into our economic engine and replicate it into much broader spectrum, such as the countries with emerging economies. So much wisdom is stored into these men, and one of the factors that need to be part of merit is the piece of golden advice.
My Thoughts: The system these men put together a number of years ago was of an individual going to work every day working for one company for their lifetime and retire with a pension. What happened to that delicate system? Was this system driven out of business for us to create a New Economy for us? Well, the economy is so volatile in the current times that things change in microseconds and not days. So, we will either need to stay a step ahead of the technology. So, let’s pick up a note pad and head to these assisted living facilities, call grandparents to not only learn about their experience but also to ask some questions as to what would you do if you were in your 20s? So men and women of this great nation, all the best, I would love to hear some of the responses you get. On your way to the assisted living facility, pick up an old fashioned ice cream for them as well, they deserve it.
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Saturday, September 5, 2009
American Hospitals: Bleeding Money Profusely?
Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “ American Hospitals: Bleeding Money Profusely?”
American Hospitals are commanded no different than some of the major airlines, a revamp of the overall system is not only integral but a Must! A total mindset is conclusive for the executives of these hospitals to survive this ride as the rules of the engagements have changed and the Health Care Reform will take place one way or the other. At least we hope! There is no doubt whether we need a healthcare reform, we absolutely do! The question is, how is it structured? Are the Americans benefiting regardless of their race, creed, age, sex? Where do these hospitals stand?
The Reform will impact the bottom line of these hospitals in a brimming way. Hospitals have been losing money for many years, this is no new scoop. However, we are facing more critical times where the government is about to pull the plug on some of these hospitals through various channels. Hospitals are mismanaging their funds and there is a very high expense ratio and upon auditing some of these hospitals we have found savings of over 22% in some cases that goes directly to their bottom line. This figure can be looked at as 22% of increased revenue.
A number of hospitals are run by executives who are in their golden years, have old ways of doing things, and are very reluctant to adopt to changes that are for the betterment of not only their hospitals but the community in general. I was astounded when I saw how some of these hospitals are spending money. Money is being bled in almost every department in these hospitals and there is no sense of accountability from top down. As Board of Directors to these hospitals it is your moral responsibility to take charge of the financials and run the hospitals as an entity that belongs to you. Most of these executives demand a high six figure paying salary and when their ship sinks, guess what, they are the first one to abandon it and jump to another ship! If you are getting six figure income, you better deliver six figure kind of results.
My Thoughts: Board of Directors, you don’t have much time to turn around this eighteen wheeler overnight. Your driver has fallen asleep on the wheel, and before you deprive your community with proper healthcare at reasonable cost, I urge you to take some time and learn how to read financials of the hospital or get some professional in there to help you with the turnaround. Swallow your pride, leave you ego at the country club, leave you emotions at home, simply bring your talents and passion to work. We will be waiting for you at the door.
So Do it! Save your Communities. Do it for little Joshua who needs a surgery!
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
American Hospitals are commanded no different than some of the major airlines, a revamp of the overall system is not only integral but a Must! A total mindset is conclusive for the executives of these hospitals to survive this ride as the rules of the engagements have changed and the Health Care Reform will take place one way or the other. At least we hope! There is no doubt whether we need a healthcare reform, we absolutely do! The question is, how is it structured? Are the Americans benefiting regardless of their race, creed, age, sex? Where do these hospitals stand?
The Reform will impact the bottom line of these hospitals in a brimming way. Hospitals have been losing money for many years, this is no new scoop. However, we are facing more critical times where the government is about to pull the plug on some of these hospitals through various channels. Hospitals are mismanaging their funds and there is a very high expense ratio and upon auditing some of these hospitals we have found savings of over 22% in some cases that goes directly to their bottom line. This figure can be looked at as 22% of increased revenue.
A number of hospitals are run by executives who are in their golden years, have old ways of doing things, and are very reluctant to adopt to changes that are for the betterment of not only their hospitals but the community in general. I was astounded when I saw how some of these hospitals are spending money. Money is being bled in almost every department in these hospitals and there is no sense of accountability from top down. As Board of Directors to these hospitals it is your moral responsibility to take charge of the financials and run the hospitals as an entity that belongs to you. Most of these executives demand a high six figure paying salary and when their ship sinks, guess what, they are the first one to abandon it and jump to another ship! If you are getting six figure income, you better deliver six figure kind of results.
My Thoughts: Board of Directors, you don’t have much time to turn around this eighteen wheeler overnight. Your driver has fallen asleep on the wheel, and before you deprive your community with proper healthcare at reasonable cost, I urge you to take some time and learn how to read financials of the hospital or get some professional in there to help you with the turnaround. Swallow your pride, leave you ego at the country club, leave you emotions at home, simply bring your talents and passion to work. We will be waiting for you at the door.
So Do it! Save your Communities. Do it for little Joshua who needs a surgery!
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Venture Capital: Is it on a Diet Pill?
Waterbury Financial Strategies Inc CEO / Founder Rahim Thawer post this week “ Venture Capital: Is it on a Diet Pill?”
Venture Capital Outlook for the upcoming years is as obscure as ever due to many external factors such as the government intervention in the private sector to the state of the economy which is very fragile across various industries and sectors. Capitalism is no longer being conceived in a positive manner and no longer are those values being embraced. It is simple, the working model is broke. We need fresh ideas and blood to re-invent the New American Standards across all different platforms.
The Institutional investors are gearing up and getting more conservative and the total commitments to alternative assets is shrinking rapidly and the industry is shrinking just as fast as it was growing. More and more Venture Capital Firms are seeking alternative means of keeping their activity up to par and many are going back to the basics, repositioning their approach of not only controlling their investment in companies in the backend, financially but also in the frontend of business development and forming strategies that will fetch revenues for the next 3-5 years before a solid exit strategy is formulated by the self correcting marketplace. Personally, I would conservatively estimate that a good 30-50% of the Venture Capital Firms will throw in the towel and walk away from the industry. Same activity was seen during the times when a number of mortgage companies decided to leave the Subprime and Prime Mortgage Arena. The smarter ones recouped their investment, made money and moved on. Where are they now? We are seeing the same activity in the financial sector, banking mainly.That being said, this could very well be a healthy transformation for many companies that are positioned well with strong strategies and people to back them up. My thoughts: embrace good strategies, cut down costs and first restructure your organization and form strong ethical relationships with competitors by joining forces to that you can stand strong in front of bigger players with just as many resources, combined.
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
Venture Capital Outlook for the upcoming years is as obscure as ever due to many external factors such as the government intervention in the private sector to the state of the economy which is very fragile across various industries and sectors. Capitalism is no longer being conceived in a positive manner and no longer are those values being embraced. It is simple, the working model is broke. We need fresh ideas and blood to re-invent the New American Standards across all different platforms.
The Institutional investors are gearing up and getting more conservative and the total commitments to alternative assets is shrinking rapidly and the industry is shrinking just as fast as it was growing. More and more Venture Capital Firms are seeking alternative means of keeping their activity up to par and many are going back to the basics, repositioning their approach of not only controlling their investment in companies in the backend, financially but also in the frontend of business development and forming strategies that will fetch revenues for the next 3-5 years before a solid exit strategy is formulated by the self correcting marketplace. Personally, I would conservatively estimate that a good 30-50% of the Venture Capital Firms will throw in the towel and walk away from the industry. Same activity was seen during the times when a number of mortgage companies decided to leave the Subprime and Prime Mortgage Arena. The smarter ones recouped their investment, made money and moved on. Where are they now? We are seeing the same activity in the financial sector, banking mainly.That being said, this could very well be a healthy transformation for many companies that are positioned well with strong strategies and people to back them up. My thoughts: embrace good strategies, cut down costs and first restructure your organization and form strong ethical relationships with competitors by joining forces to that you can stand strong in front of bigger players with just as many resources, combined.
Rahim Thawer /
CEO of Waterbury Financial Strategies Inc
http://www.waterburyfs.com
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