article thumbnail

Should you cast your net where the big fish swim?

Berkonomics

Email readers, continue here…] I have been on the board of a services company that specializes in the middle of the market, knowing that very large competitors throw lots of resources at the largest accounts – resources that our company just does not have. A personal story about dealing with too large a company.

.Net 156
article thumbnail

An economics lesson for growing companies

Berkonomics

Growing companies usually require more working capital during their periods of rapid growth. If the equity value of a company is growing at the same rate as the company, say 40% per year, almost any form of debt financing may be preferable as a way of preventing further dilution from issuing additional equity.

Company 156
Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

What is the real goal for our management and company?

Berkonomics

Often, we joke together as managers of companies or of people that our goal is “world domination” or “to crush the competition.” But that is a number in a vacuum without at least two other measures: return on investment (ROI) and percentage of net profit to revenue. How about companies formed to profit and give to charity?

Company 156
article thumbnail

Cast your net where the big fish swim.

Berkonomics

Email readers, continue here.] I am on the board of a services company that specializes in the middle of the market, knowing that very large competitors throw lots of resources at the largest accounts – resources that our company just does not have.

.Net 235
article thumbnail

Does your company have a “dirty cap table?”

Berkonomics

The problem in taking such money rests in the legality of taking money from non-accredited investors, people who do not meet the SEC standard for making non-public company investments. Does issuing a PPM insulate the company? What if some past investors don’t meet that standard? So, what is the problem? Your future process.

Company 156
article thumbnail

Why You Should Think Twice Before You Send That Intro Email

Both Sides of the Table

And in most cases I would heed Fred Wilson’s advice about the “double opt-in” email for intros – where you ask for permission before green-lighting an unsolicited introductions. At a minimum you’re obligating them to ignore the email and feel like an arse for not responding to your introduction.

Email 359
article thumbnail

How much is that one additional unit worth?

Berkonomics

Let’s say that your company is exactly at breakeven. There is amazing leverage in high gross profit margins once a company is past breakeven. Every dollar of gross profit falls to the bottom line, increasing net profit faster with each transaction. Just to be fair, a 5% cut in costs would also double net profit.

.Net 156