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.

Jr. Iditarod Race from Our Front Porch

Living out in the boonies as we do, we see more eagles than people. But once a year, we have front row seats for a dog mushing race that runs right past our cabin.  We look forward to this each February.

A racer passing by our porch

The Junior Iditarod is a two day, 150 mile race for teenaged competitors (14-17) that has been run in the vicinity of Willow, Alaska since 1977.  Each musher must raise, care for, train, and race his or her own team of dogs (usually 10), so the competition is the culmination of many months of commitment.  The entry fee is currently $150 – 250, depending on date of payment.  The prize money of about $10,000 is split among the fastest finishers, but that surely doesn't even cover the expense of feeding and training a whole kennel of dogs. Before the recession (before 2009), the peak number of participants I found was 22. Most years, though, the entry pool consists of only 9-12 intrepid racers.

It is fair to say that more volunteers than competitors participate, many of whom are long timers.   They have volunteered their time as pilots, snowmachiners, ham radio operators, check point timers, cooks and bottle washers.  Each gathering includes some reminiscence of the kids who graduated from this race to enter the “senior” Iditarod – the grueling 1000 mile race that starts  the following weekend (First weekend of March) and lasts for ten days.  Our only full time neighbor (within ten miles) has offered his small lodge as a check point for a decade or more, which is why the race route passes us.

Refrigeration Alternatives Off-Grid

I love icy cold fruit juice and white wine.  How can we accomplish this at our off-grid cabin?

How do we store cheese and other dairy products, as well as fruits and vegetables? 

We rely on a mix of powered and natural methods that vary somewhat according to the season.  Each is highlighted below.  Non-powered methods include a cold-hole, canning, and drying foods, as well as the simple expedient of utilizing freezing temperatures, snow, and shade. Powered methods include a propane powered refrigerator and solar/wind powered electric freezers.  Some of these approaches can work for anybody, anywhere.     

Year Round:

Many years ago, we dug outside our food shed a “cold hole” that functions as a refrigerator.  It is not as big as a basement or even a root cellar, but it functions the same way.  It is the depth and size of two vertically dropped, welded, food grade 55 gallon drums. Over this hangs a beam from which dangles a metal cable on a winch.  When we lift aside the double layered wood and polystyrene lid, we attach the cable to a sturdy eyelet on the top of a set of five, layered lucite shelves that fit within the double depth of the canisters.  Each shelf can support 8 - quart jars of food, or a net bag of vegetables, or several packages  of dairy products.  The temperature varies from top to bottom of the hole, at different times of year, but it is always above freezing and below 52 degrees, so functional for refrigeration.  I have been very pleased by its reliablility for storing potatoes and unopened cheese all winter, for example.  It is not convenient for everyday use, but excellent for long term storage and occasional retrievals.

What If??? --- Stocking Our Emergency "To Go" Bags

The FAA requires each private pilot to carry emergency supplies, not only for him/herself, but also for the number of passengers on board who could also be stranded in a remote location and have to fend for themselves either until help arrives or until they hike out to find some.

Aviation and personal gear, winter

My husband and I think that this is such a prudent idea that we also apply it  to our car and snowmachines.  Each one has an emergency bag, too.  Even our home, in a way.  Because it is small, we store clothes, food, matches, and supplies in various outbuildings. Perhaps some of those structures will be unimpaired even if our cabin is damaged by fire or earthquake.  Each year, we re-evaluate our “to-go bags” with the goal of reducing weight/bulk while improving efficiency and effectiveness. Currently, the largest (blue) one (for the plane and snowmachine) weighs about 25 pounds.  The small (black) backpacks weigh about 10 pounds.    

Reality Check of Alaska Reality Shows – My Experience

I read recently that there are 36 Alaska Reality Shows at one time! What? Doesn't anyone want to see characters in Wisconsin or Maine? How about Puerto Rico?

My experience with these shows is limited to conversations with seven – count 'em: seven - producers who have contacted us over the past three years.

We have (politely, I hope) declined them all. Often we suggested other people we thought might be more interested in them or more interesting to viewers. Below, I'll share my observations from those discussions.

Since we don't own a TV, I have seen only a smattering of random episodes when I have visited relatives and friends in the Lower 48 who invariably ask, “So, do you know the guy/gal on this show?” However, I am as entertained as any Alaskan in local feedback on programs by people who are more “in the know.” Occasionally, writers for Alaska Dispatch News review a show, usually by humorously panning the obvious fakery of the situation.  Then, locals chime in at the bottom of the on-line article to add more details. For example, one show looks like it is remote but apparently the camera is planted in the parking lot of a pizza joint! It points across the road to an empty stretch of woods where that show's “hero” does whatever he does to look like a mountain man. In general, Alaskans accord a loss of credibility to participants. On the other hand, I viewed one episode of an ongoing series (Building Alaska) that depicted realistic experiences directly analogous to our real-life endeavors, and in our neck of the woods, too, so maybe there are some other realistic ones out there.

In our case, we have been contacted by two producers each in LA, NY, and Europe (UK and Netherlands) as well as the National Geographic (two producers, one in Singapore and one in Hong Kong). Four of the seven were independent producers rather than name brand shows. Each small firm seemed to toss out story ideas, film an episode or two and then endeavor to sell the idea of a series to a distributor. 

The topics broached by these producers with us included the following:

*Mistakes we made, as city slickers who moved out to a remote home in the Alaska woods.

* An “average week” with us in the winter/ in summer
* Life skills we could teach their host to demonstrate
* Life skills a rural child could teach a child host

* “Alaskan-type jobs” of people living remotely

* Pretend we were shopping for a remote property and then choose ours
* Compare/contrast our life in Alaska with a family living in someplace tropical, I think it was Costa Rica