Tuesday, March 8, 2016

Winter Ski Plane Challenges in Remote Alaska

Winter flying introduces a number of duties and challenges not encountered in warm weather, but there are some advantages, too. Below are a few anecdotes from our ski plane flights, as we fly to and from our remote home in the Alaska Bush.

Warm Up:  Like any car in cold climates, we have to warm up the plane, since we do not store it in a hangar.  The day before a flight, Bryan unravels a long blue electrical cord  stored behind a cedar loveseat on our front porch, and threads it from an electric plug on the outer wall, down through the snow to the frozen lake where we have tethered the plane to two boards frozen beneath four feet of lake ice.  With the cord, he charges the plane's battery, since its performance degrades in cold temperatures.

The next day, an hour before the flight, we pre-heat the plane. When we first bought the aged plane (a 1954 Piper PA-20), the owner gave us an ancient Red Dragon heater that he had not used often.  To utilize it, we drag it down to the plane in a little black plastic sled, along with a 20 lb propane tank, a board (as a flat, hard surface for the heater), a battery charger, and a five foot long heating tube (that you shove up into the engine compartment).  Unfortunately, the tube  was so perforated with tiny holes that it took us 45 minutes to pre-heat the engine.  Not a fun wait at freezing temperatures!  Once we figured out the problem, we bought a new one for $200 that cut the time down to 15 minutes.  Well worth it.   Until... one day, when the low temperatures and the low voltage battery charger conspired to cause a near emergency.  The charger was underpowered for the job on a particularly cold day.  It had enough power to generate a hot flame but not enough to push the heat through to the plane's engine.  The tube caught fire!  We lacked a handy fire extinguisher but Bryan yanked it out of the cowling and tossed it on the snow, where the fabric sheath disintegrated into fluffy, gray ash. We learned several lessons that day.  One is to keep a fire extingisher with the dragon heater.  Another is to make sure that the bungee cords of the cowl cover are totally detached from every single hook for a rapid whisk away from the nose cone.  A  third is to utilize my snowmachine instead of the modest battery charger for future power (and the added convenience of grooming the landing strip after he departs).

Sunday, March 6, 2016

Start Ups: How is Your Financing Going (or Not)?

Every day, our company receives calls and emails from companies seeking investment.

The large ones we route to our investment banking practice and the small ones to our investment conferences in New York, where they can represent themselves to investors without an intermediary.  (Others call about our narrow angel investment criteria in telecom or board positions).

But the great majority of callers do none of the above.  Some want something for nothing.  Others are dreamers whose aspirational companies are unlikely to get off the ground, but remain the subject of loving and lengthy monologues.

It is pretty easy to separate the wheat from the chaff –
(a) those callers who understand the endurance race aspect to raising capital vs.
(b) those who think  they just have to talk someone's ear off to collect no-questions-asked checks.

The following paragraphs include snippets of  seven, initial conversations with members of the latter group (the naive idealists or what?) followed by my behind-the-scenes interpretation.  What is your first impression?  Do you think the caller will be taken seriously by a finance professional?  If not, do not be like them!

Entrepreneur 1: “I don't need to hire your investment bank or present at your conference.  I will be funded by then.”
Us:   “Then how can we help you (I'm wondering,  uh, why did you call us)?” and “Wonderful news!  Are you currently negotiating a letter of intent?  (No)  Do you have a closing date on the calender (No)."
Entrepreneur 1:  “But we have several initial meetings scheduled and they'll love us.”
Interpretation: This caller does not know that investment is often a needle – in-a-haystack search, followed by a lengthy period of due diligence, a letter of intent, negotiated terms, legal advisors, finally culminating in a well defined closing date.  In other words, it entails a protracted and wholly predictable schedule of milestones.  Therefore, this blithe comment reveals that s/he has never worked with investors before.  Some service providers may take advantage of that.  In any case, s/he has lost credibility with professionals who know what s/he does not.