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Last Update: Wednesday June 23, 2021

Key Idea: Tell Your Story Well

Jonathan Langley has a great story to tell investors.

Key Question:

A: 

Sure, but you have to learn to tell your story well.

When people ask you to tell them about your business, does your face light up? Do you speak poetry? Do you know why you're doing what you're doing? Do you have employees who do fabulous work? Do your customers brag on you? The great actor, Fess Parker, has been a very successful business man for 40 years. He told me that the story of a business is as important to the success of the business as the script is to a play, television show or film.
     
    Q:
Does Brad Armstrong believe that his company, Blue Whale Movers, is a good investment?
   
    A: Of course. You can tell by the way he tells his story. If you don't remember the expression on Brad's face when he described how two young men moved all the furniture out of his house in a couple hours, go back to the video. An attorney by profession, Brad was amazed at the work style of these two and personally invested in the business. Blake and Brad formed a new company, named it Blue Whale Movers and started the adventure they are on today.
   
    Q: Why did Brad and Blake name the company, Blue Whale?
     
    A:
They wanted a name they could trademark. Being an attorney comes in handy sometimes and Brad knew the type of name that can be protected. He said, "Blake and I spent three days poring over names, looking for a trademark that was fanciful, that was unique and that was non descriptive, which are the requirements for a national trademark. And it was as if a light bulb went off over our heads: we could see the blue whale as people now see them on our trailers going down the highways, and we knew that that was the definitive mark for a moving company."
   
    Q:  Why is Brad's mission statement so important for the fund-raising process?
   
    A:  He said it is not just public relations, but a decision making tool. Here it is: "By 31 December, 2003, Blue Whale will have become pre-eminent in the moving and storage industry, with locations in 100 cities worldwide. Marked by complete commitment and dedication to the highest standards of moral and ethical excellence, Blue Whale will be delivering an exceptional service experience created uniquely for each customer by radiating positive energy throughout our team and reflecting that love and respect upon our customers and all those we serve. Only then will successful evolution into other products, markets and services be guaranteed."
   
    When a potential investor sees and hears this mission statement, they have the big idea of what they are getting involved in. The words you choose to express yourself are telling. The Blue Whale mission statement is attractive and has a magnetic power. Happy customers are the most fertile field of prospective investors.

Think about it

Does your mission statement make a powerful message of who you are, not just what you do? Can every employee in the organization recite the statement by heart?

Clip from: Small Corporate Offering Registration (SCOR)

Austin, Texas:  The Securities Exchange Commission (SEC) instrument known as Small Corporate Offering Registration (SCOR), sometimes referred to as Reg D Rule 504, is a little-known, but important tool for small businesses.

Mandated by Congress, every year since 1982 the SEC has held an annual meeting for small business investors and owners called "Small Business Capital Formation Conference."   The first result of that conference was the Reg D Rule 504.

In 1992, ten years later, Deborah Bortner, the Securities Administrator for the State of Washington, led the way to simplify the registration by developing the SCOR document.

At that time Congress wanted to help small business owner who have a difficult time finding money.  Another aspect of the SCOR is use it as a liquidity model that forces a business valuation. It could also be used as an exit strategy.  The majority of small business owners do not have a succession plan and a SCOR would necessitate that such a plan be implemented.

Historically, out of every $100 in banks loan, small business gets about $7. Though contributing over 50% of the Gross National Product,  working capital is often difficult to obtain.

The SCOR has not caught on. There is very little publicity about it and just a few educational resources. It does require three years of audited financials. It does involve your CPA and a good securities lawyer. 

The SCOR could be used in the following ways:  (1)  A cornerstone of a succession plan and liquidity model for mature small businesses, (2) An alternative to an employee-stock ownership program, (3) A means for all those who already want to buy into a business to do so without going through an IPO and without necessarily being a qualified investor, and (3) An instrument to provide a conservative diversification strategy for pension funds, mutual funds, and private investors.

Because of the ubiquity of the web, Small Business School will promote any and all attempts to develop  mechanisms so the best small businesses are indexed against one another and the best among the best rise to the top and are immediately qualified to be selected by any investor to receive equity capital.

It will change business in America forever.  Small business can share equity,  learn about liquidity models,  understand our financials and key critical ratios, and then participate in the market just like any big business.

Go to all the key ideas and videos of this episode...

TVPC

Jonathan Langley, Chairman

106 W 32nd St Austin, TX 78705

Visit our web site: tvpc.tv

Business Classification:
entertainment

Year Founded:

Tell Your Story Well

JONATHAN LANGLEY (TVPC): This is our new box, which is $349. This is a prototype, but basically, you plug it into your TV...

DAVID: It has a microprocessor?

JONATHAN: Yes. With TVPC, especially if I've got children--and I have a two-year-old--I can sit there with my two-year-old and actually do education games, load--like, take the games from the shelf at the store, load it on the machine and cruise the Web. But I can also sit there with my son William and do some of these education titles or even a Disney title, all right? Whereas trying--and sit on the couch and do it--whereas trying to do that, putting him in my home office chair with me crouching beside him, even on a 17-inch monitor, that's no fun. So we have CouchWare that does all that.

Our target market is families who are buying their first PC and want to make it a shared experience, not just in the home office. And it's also for families or households who want a second PC and are tired of having the kids play with Dad's home office machine. That market is huge. I mean, we sell these on the Web and we get inquiries from all over the world. I mean, we've had inquires, like I said earlier, from all over Europe. I financed this, so far, all myself. And we've grown basically out of a typical start-up situation, out of a garage. David, based on everything you've seen today, do you think we're a good candidate for a DPO?

DAVID: I think you're an excellent candidate for an Internet direct public offering.

JONATHAN: Wow. And do you think the Internet's a great place to publicize that?

DAVID: Yes, I do. Yes, absolutely, especially for an Internet business.

JONATHAN: Right. How much do you have to give up on a DPO, in ownership terms?

DAVID: Less than with the other routes but I can't answer that question until I've seen what your--well, you'd have to be selling at least 10 percent of your business, I would think in order to make it appear to be reasonable.

JONATHAN: All right, but it's not like 50 percent or something.

DAVID: No.

JONATHAN: OK. All right. That's what I was getting at.

IN STUDIO HATTIE: This is Thomas Stewart Gordon, who publishes the SCOR Report, a newsletter about capital formation, says when looking for a broker to help you sell your stock, don't engage anyone you haven't checked out.

(Voiceover) Keep in mind, very few brokers are familiar with SCOR. Some brokers will ask you for leads to help you sell your stock, then they will try to sell other offerings to the leads you've given them. Any broker you talk with should ask for a due diligence fee, then will also want to see your financial statements, business plan, tax returns and many other details before he agrees to sell your stock to his customers. When you find a broker you think will work for you, call your state securities board and tell them you want to run a name through the CRD. It contains the names of all National Association of Securities Dealers, registered firms and individual brokers, together with their disciplinary history.

TOM STEWART GORDON (SCOR Report Newsletter): Well, of course, the first thing you have to have is a business plan, because the form U-7, which is the do-it-yourself prospectus, or offering document, works best if you have a business plan. You just take items from the business plan and put it into the 50 questions of the form U-7. You have to file this form with any state in which you wish to sell your securities. One of the things that I've noticed is that companies that deal with their state are better off than companies that try to sell in, say, California, because there are a lot of people in California. If you're not known, you're panhandling, you're asking strangers for money, and it's not going to work that well. HATTIE: So it's better just to register in your own state, try and raise...

TOM: Go where you're known, yeah.

HATTIE: So what is this really going to cost me, to go out and raise a under $1 million, or $1 million to $5 million? TOM: Well, the average is about $30,000. That includes the attorney, if you have an attorney review your documents, which I recommend so you don't paint yourself into a corner and say you're going to do something you can't possibly do, the accountant, mailing, postage, phone calls. Normally, what happens is that the company gets big enough to get noticed by an even bigger company, who makes an offer, buys the company, buys all the shareholder stock, and that's how you harvest your investment.

HATTIE: It's worth a try.

TOM: Oh, yeah. If you do your homework and you've got a good company and a good plan, good management, then you're more likely to win than if you are at the 'I've got a great idea' stage.

HATTIE: So we can subscribe to your newsletter?

TOM: Yes you may.

HATTIE: And we find out about that by going to www.scor-report.com

TOM: Right, no E on SCOR.

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