Money vs. Time

Now that we are building out our next proof-of-concept, we are starting to obtain a completely different perspective on money. Whereas we were looking at giving up 33% of the company to get started 2 months ago, in another two months we will actually obtain more money and yet only have to give up less than 20% of the company.

At the same time, we are faced with a 4 month delay on a project that will take a total of 6 months to build out to the point where it can be sold. So this appears to be a negative but I am not sure how negative it really is.

OK there is the whole "end of year" thing - you know where companies tend to spend most of their budget at the end of the year. That said, the economy is still recovering and it might not be until next year that Big Checks are written. In fact, our current timing places us in the second quarter of 2010 and that might end up being perfect.

On the flip side, we are missing out on the holiday season and who knows how that might affect us in the end. It is interesting to ponder as I had a friend ask me if the savings in equity was worth the time delay - I simply do not know.

Not that we had a choice in the matter ...

Dealing with Deep Technologists

So the first thing I learned was that deep technologist - even good friends - do NOT like to explain things. It is not some perverse sense of hiding the technology or anything - these guys just get nervous if they have to say too much. In my case that was disastrous.

My Deep Technologist (DT) and I worked on a comprehensive message to present to investors and those investors' sets of experts. Since my DT cannot explain things to me corrected half the time (and I have my own deep set of technical abilities), it was up to me to extract from Mr. DT the actual details at a low level and boil those up into business terms. Along those lines, we spent weeks pouring through all of the intricacies of the invention, how things would be obtained, stored, transported, etc... and all the while Mr. DT kept nodding his head saying "that sounds about right"

If your DT ever says "that sounds about right", hit him/her HARD - SEVERAL TIMES - trust me that will be much less painful in the end.

Instead, I took our agreed upon message to my investment group, all set to get my money are start building, and the experts trashed my invention. IMPOSSIBLE, STUPID, NAIVE (and those were the nice things). What the hell?!? Our invention was sound, we had a proof-of-concept - WHAT WENT WRONG???

After the 3rd such trouncing, I sat down with Mr. DT and asked him to go through things again just to make sure we were not missing anything. His response? "Oh those guys were correct, you were not saying things correctly at a deep level". Seriously, he was lucky we were on the phone or maybe I was lucky as jail sounds even worse than this venture.

After I ram out of breath from providing my enthusiasm over his response, Mr. DT and I laboriously went through everything AGAIN. This time I harbored no "sort of"s or "about right"s. I beat on Mr. DT until I finally had everything correct.

So I took the CORRECT version to a 4th expert and LO AND BEHOLD he was on board (immediately I might add). On top of that, two or the other 3 (one refused to ever talk to us again) also got back on board. Great - right?!?

Hardly. With the negative hits from the stupid initial communications, the valuation of the company was dropped 70% by this investment group and they want yet another proof of concept prior to funding the actual development effort. To say the least we are at an impasse and I am now looking for other funding - essentially starting over again.