The Advisors - Larry, Curly, and Moe

So we had our first meeting with the advisory company. One of the Big 5. It was suggested that we meet at their offices.

Met with Larry, Curly and Moe.

Larry is the guy who just sits there making sympathetic sounds and throws in a few clichés. Curly is the technical expert who has studied "Roget's Thesaurus of Technical Buzzwords", and Moe is the private equity guy who decides on what the "right strategy" for funding. At the same time he is an expert on how your business should be run and what markets you should be focussing on (this from just one glance at our web site)and also seems to know what our attrition rate is. Amazing people these guys, so knowledgeable and so intelligent.

An advisory service allegedly will value our business and tie us up with the zillions of potential investors that they have lined up (I half expect to see a line of investors outside their doors).

As with the VC meeting this starts off with a statement about how we are too small ( tell me something I don’t know !!) and how most of the financing options they have are looking for bigger investments (Here we go again...). I am asked to explain our business and business model. Curly (the technical expert) impresses me tremendously with his knowledge of the technologies associated with our business. Only thing I suspect is that he just knows the names. Nothing beyond.

Anyway, so I go through our business, our plans (and dreams), focus areas etc, when Moe starts giving me a discourse on how we should be approaching the various markets. What a genius! Here I am with only 18 piddly years of experience in markets like the USA, Europe and the Asia Pacific (my partner didn't come with me that day is a novice with only about 20 years of experience), and Moe who has not worked outside the shores of India is actually telling us what markets to look at. Amazing what Google has done for him. Fortunately he has to step out for a call so I am saved the embarrassment of humbly correcting him.

So, next I get questions like, "So what kind of investors are you looking at?", "Who is a possible partner?", "Are you looking to give up management control?" etc etc. It reminds me of questions that a real estate agent asked when I was looking for a rental house. "So what kind of house are you looking for? How many bedrooms? Are you looking for attached bathrooms? Do you need an independent house? Do you need an attached bathroom?" etc.

Anyway the meeting ends with a promise to visit our office to see for themselves what we are actually doing. Which as far as I was concerned was their way of saying "Don't call us, we'll call you". Two weeks later they did call and came over for a visit (I had totally forgotten about it by that time). Maybe they needed the business.

So anyway they landed up. Just two of them. Moe (the private equity "expert" was missing). Two glasses of water and three cups of coffee later they were asking us the same questions (this time my partner in crime was with me). Once again the same "real estate" type of questions followed by suggestions on how we can improve our business.... what markets we need to be looking at etc. I am amazed at the depth of knowledge here. Just by looking at my web site and a three page executive summary, these guys are able to tell me what my focus area should be. Isn't it incredible that a guy who’s never run a business ever tells you what you should be doing? I immediately make a note to myself that in my next life I want to be an "advisory consultant" (maybe in this life even).

Finally they decide to leave with a promise to come back with a proposal. Their business model is to work for a combination of retainer plus success fee. For this, they'll represent us to the investment community. They however hasten to add that there are no guarantees.

I am still waiting for their proposal (not holding my breath though). I suspect that I need to raise another round of VC funding to be able to afford their fees. In the meantime I read an interesting article on Business Week online. Talks about how small businesses shouldn't count on VC money and how VC money comes when you least need it.

Is that the right way to go? Should we just say hell with the VCs and look at building the business to the next level on our own instead? Well, looks like that’s the way its heading.

Except Larry called me this morning.