Guest Speaker: John Dimmer

*(Oregon Duck) University of Oregon
*Cloverpark Hichschool
*Golf

*BS in finance *Puget Sound bank
(?) *Surety bond (Insurance/Bond)
*Free Range Media 94 with Fry
-Sold in 1999
--Employment agreement – Sacked, severance package
--Retired for 3 weeks at age 39.
*(Dot com boom – companies that don’t exist until put on market)
*Dot com bust April 2000
*Angel investing, technology. (typically go for 1%-3%)
*Hiring the right people in the right places.
-(Right folks can become wrong folks if business rapidly changes)
-Keeping a warm body in a spot even if suboptimal
*Partnership with friends
-Built a Honda dealership
--Good manager hired. Golden handcuffs needed.
---Honda store is franchisee of franchiser Honda. Couldn’t give him equity cause Honda is reluctant.
---Manager wants an RV(Airstream) dealership. After financial crisis 2008. Did well.
----Largest Airstream dealer, every 1 in 4 global airstreams.
----Airstream recession resilient
----Ted oversees Honda & Airstream. Golden handcuffs.
-----But then they moved him out of Honda.
-----New manager. Good guy, once again need golden handcuffs.

**Funding your business

*Business lifecycle phases
-Concept – Idea
-Start-up – organization structure. Nominal or no profit.
-Expansion – business established in market
-Mezzanine – prepare a company for initial public offering (IPO)
-Exit – Prepare a company for sale transaction.
?Market share? – Owning a percentage of the market.
?What does mezzanine mean? – “Intermediate” Between not-IPO and IPO.
-IPO means you get government regulation.
 

*Fund types
-Debt - borrow cash.

-Equity – sell ownership interest.
-Hybrid – Debt/preferred securities convertible into equity.
-Other – Business plan prize money. –Government grants. –Veteran program –Crowd sourcing
(?)-Preferred securities – common stock vs preferred stock. Common is flexible for when company liquidates. Preferred is specialized.
--Converted debt into stock that works like debt. Some people think it looks better.
-In crowd sourcing, don’t over commit, make sure you can deliver.

*Legal structure – some business structures restrict certain funding.

-Sub-Chapter S Company – “Pass-through entity.” Cannot have Limited Liability Companies (LLCs) be shareholders.
-“C” Corporation – well defined laws. Self-contained. Drawback: double taxation of dividends.
-Limited Liability companies.

?Corporations are people – “C” corporation. Sued like a person.

*Stages of investment

-Concept or idea – Founder’s money. Enough to have “skin in the game.” (but not “all in”)
-Proof-of-Concept – Friends and family money. (Accredited investor laws…)
Product Design – Angel money
Expansion – Venture Capital

-“Skin in the game” means stick around. Not “all in” means less pressure.

-Not-accredited investor can stop a buyout, so you gotta buy them out. Have a predetermined buyout plan so they don’t hold you ransom.
-Keep number of family investors low, phone calls.
-Angel group presentation cost: $250-$500
--Look for groups predisposed to your business or demographic.

-As an angel, John Dimmer looks for people. Investing makes a relation. Prefers people over idea. He’s trusting people to follow through.

--Likes investing in spaces he knows.

(questions)

*Accredit investor questionnaire.

-Non-accredited is a problem in stock for stock sales. Doesn’t apply to cash buyout.

?Could you still retire? –Yes. –Don’t see that happening.

-Home office. Wakes whenever.
-Dad is the same.

*Tech. business – does not miss the 24/7 pressure. (literally dreaming solutions)

*Strengths and weaknesses

-Cannot write HTML or code
+Operations. HR. Finance.