Rather than asking you to develop a business plan or even a slide deck to pitch investors and then send it to us for review, we ask first that you take the following quiz on the reality of funding early stage firms.
1. How many firms a week seek funding by listing on GUST?
2. How many turndowns do angel groups do before making an investment?
3. How many angel investments are followed by a venture capital round?
Answer: Less than half
4. Of 25 angel investments, how many return
- less than the amount invested?
- less than twice the amount invested?
- funds from an IPO?
- funds from the sale of the company (M&A)?
- ten times the amount invested?
5. How does growth equity differ from venture capital?
Answer: Venture capital is a subset of the types of equity available for financing growth and only one of the several equity options available.
6. What percent of firms that have obtained funds from an IPO and have sales of $50M, attain sales of $1B?
7. What percent of firms reaching sales of $1B attain sales of $10B?
8. What percentage of firms funded on Dragon’s Den actually get the investment after due diligence is complete?
Finished? Click here to reveal the answers.
Any of the answers surprise you? If you said yes, then you’re certainly in the majority. Now that you have some insight into the realities, let take a look at the process that will lead us to a possible engagement.
The Kemball Group is designed to provide founders’ advice on whether or not and how to grow their business at more than 20% a year, year in and year out. Few do, fewer should. For each who should, their specific requirements dictate what we do and how. It is highly individualized and tailored consulting, and if the entrepreneur does very well we will do well. The earlier in a firm’s history the issue of growth rate is tackled, the better the odds of survival for a decade or more.
Stage One: Self-Assessment
The point of departure in our relationship is governed by your assessment of how well prepared you and your colleagues are to seek external funding. The Fundraising Request Form is based on our 25-years experience raising in excess of $200,000,000 for entrepreneurs. It lets you self-assess how well you understand prospective types of funding and how well you’re structured for success. We urge you to fill it in and send it to us, as well as use it as a blueprint for self-assessment.
Stage Two: Critical Factor Assessment
Based on the template, we can then move to the next stage, in which we will first ask you to take one of three Critical Factors Assessment quizzes that we will provide to you as the first step in our relationship. The cost of these quizzes will range from $495 to $1395 depending on which one is most appropriate for the stage at which you are currently. Our challenge to you is simple: if you cannot convince yourselves that it is worthwhile for you to pay at least $495, less than a week’s pay for most and a day’s for those established in the workplace, then do not expect others to invest their time with you. It’s that simple.
Stage Three: Engagement Contract
Only when we mutually conclude that much can probably be gained by collaborating in the building of your firm, do we enter into a consulting engagement contract. You can exit at the end of the initial phase if it appears to you that the collaboration will not be productive as can we. Thereafter if you do not approve the work of the prior month we stop until agreement is reached. At any point in the relationship if either party cannot live with the golden rule of “tangle with vigour over the issues but never over the personalities,” our engagement letter contains provision for mediation of all commercial disputes.
Rates and Payments
The Kemball Group believes that the value of its contributions plus what you retain in the value of your growth in the firm’s equity substantially exceeds the value of the average corporate lawyer. Typically a partner in a law firm with a decade’s experience will charge $4,000 a day in fifteen minute increments. Our rate is $2,000 CDN per day. We recognize that every rapidly growing firm struggles with cash flow. Therefore we provide terms to allow you to pay us when you receive funds. Such arrangements are through a third party so we can work together without finances disrupting the relationship. The cost of this financing is two percent a month.