Posts Tagged ‘vendor relations’

High growth start-ups & Working Capital

July 17th, 2008 Comments off

     Just finished meeting with a friend who has what would still be considered a start-up business that specializes in the nutrition & supplement sector.  Keep in mind that he’s not a rookie entrepreneur and that he has a background in investment banking, specifically mergers & acquisitions. However, he struggles with all of the same issues that any start-up entrepreneur does, which is the management of insufficient working capital and the need to support high-growth.  Although it might be relatively easy for him to let a piece of the business go for an infusion of cash, he’s well aware of the cost for the additional capital.

     Like the company I worked with in Florida, which was subsequently sold for 50% more than the target price we set, we’re going to start looking at the details of his forecasts, current capital levels, and begin connecting him with some of the folks in my network.  We’re going to schedule a number of meetings with some of my contacts that will help him better manage vendor relationships, will hopefully introduce some new banking contacts, as well as evaluate the analytics of how he is measuring his business.

     Fortunately, in this case, he is not a turnaround and is not bleeding capital, but at the same time he finds himself in a challenging situation.  Putting the proper management and reporting techniques into play, this early in the game, will help him through a tough economic environment and position him very well for the continued growth once we emerge into greener revenue pastures.

Thanks for reading . . .