Well, this went screaming over your head as usual.
Right. Iām the one thatās clueless. Never change, clown.
No no, guys. Big Pharm holds a monopoly over the pharmaceutical industry. Thatās why there are literally tens of thousands of pharmaceutical companies in the world.
4 derps, Zep. Youāre awarded four derps for this comment.
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Here Zep, just read this:
http://www.moyak.com/papers/small-business-failure.html
Youāre welcome.
Zepās usual faceplant notwithstanding, he does raise a kernel of a good point when you strip it from all the hysteria and conspiracy - smaller businesses that are more credit-dependent have had trouble getting banks to lend to them, and itās not solely because they have inchoate or bad business plans or fundamentals.
These days, banks are extremely risk averse to start with, and thereās much easier ways to get returns on the capital they would otherwise lend to small businesses. And, the high transaction costs (made higher by Dodd-Frank, and backed by the Goldman Sachs of the world) make it even less palatable.
So, I think there are real issues (which is one of the reasons Congress voted* to relax restrictions on community banks).
*IIRC, I think there was a vote - it was being considered
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I started a business from the ground up after getting fired from a job. I had $500 in my pockets near Xmas time. Not the best time to start a business. I tried to get a small business loan no dice. I struggled to find places to open a line of credit to get supplies. It was a service businessā¦ long story short. I made it without a loan. 5 Yearās later I had 20 employees and gross sales of 2.5+ million, paid taxes on 275k. And banks were calling me to loan me money. I laughed at them when they called. I simply asked the āwtf were you when I needed your money, now I donāt screw off.ā And hung up the phone.
I sold the business a year later because I hated itā¦I never liked the work. I did enjoy providing a quality job to people of value and didnāt take it all for myself but helped some guys get on their feet. I sold it to the first two employees I hired.
They ran it into the ground in two years. They never learned the cash flow lessons I did from working it from the ground up.
I make much less now and am much happier.
Warning: There is a tax hump. You can make up to around 250k no problem. Anything after that Uncle Sam comes and takes nearly every penny over that up to 900k-1.5 mil. The. You see additional profits. When O came into office it got worse and the insurance thing must have been terrible.
Give it a spin you will learn a lot or it will eat you alive.
You can make a fatal mistake in the first year that wonāt show for 6-8 months if you donāt know how to handle cash flow properlyā¦
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It would be the end of the internet if those people stopped posting.
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Thatās the fault of the financial institution that gave you the initial loan. You had, apparently, not requested enough and they had failed to foresee this. They have people trained to do this.
Seriously, THIS is what this nitwit(the OP) is saying.
Heās not upset about startups failing to acquire a loan due to not being able to meet certain arbitrary criteria.
Heās not contemplating whether the interest rates are āfairā.
Heās not ranting on the often perceived lack of sources for acquiring funding.
Heās not worried about the inability to procure funds for sustainability when faced with cash flow problems.
Or investors using this as leverage to demand an unreasonable amount of equity.
He thinks the financial institutions assume the duty to ensure the business taking the loan has the right amount of funds from the start and should, therefore, share the blame if the business fails.
Taking this to itās logical conclusion, the business owner or company director should have a valid case if he decides to sue the financial institution for failure to perform itās duty.
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I find it interesting that the logical conclusion of nearly all of Zepās ideas would immediately result in widespread lawsuits and the shutdown of the private sector.
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This is very much the case. Also over-estimating revenue in the initial run. Not the bankās problem. Those are both very well known problems for start ups.
The other thing is that banksāat least the local banks that a small business owner is likely to go to for loansārun on much smaller margins than investment banks (aka ātoo big to failā Evil Empire of Capitalism banks). This is not to say āsmallā margins, but they by necessity have to be more careful with their loans due to the way they are structured.
Very possibly ā.9 of a bananaā classic.
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Most banks are far more risk averse now. One thing I find is that if you want to borrow a smaller amount for a short term need (like buying $50k of inventory you already have a P.O. for) the business loan guy at a branch of a larger institution will almost laugh you out of the building. It costs them a lot to originate a loan and do due diligence. I had a guy at a credit union with 5 branches tell me they donāt even consider business loans <$250k.
Like @dt79 brought up there are many options other than banks now (āsocial lendingā, VCās, hard money guys). It will be interesting to see how the ecosystem evolves the more we tie banks hands.
I am convinced this is the way to goā¦ now. Haha. Oh the painful lessons.
Cash flow is like a heart monitor. You get below a certain point, youāre dead.
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Wasnāt me. But Iāll add to it.
Look to Asia.
Example:
See how many resources there are now for startups. Funding, networking, consultants, industry specific organisations etc. Just fucking go look. One of my old friends set up a startup incubator company just 5 years ago. The amount of investment and number of startups is astounding.
You donāt have people with enough qualifications on your team to impress investors or to meet the criteria for funding from an organisation? Go search a freelance site. There are actually people who lend their names, qualifications and experience to you for listing on your board of directors.
Look at where the majority of the startups are emerging from. Itās the developing world.
Go see the stats on new ICOs. They can acquire funds in the millions from first round investors who are VCs, not the public, without even a complete product, just a roadmap.
The developing world wants to break out. And it WILL. Because people there have balls and very little to lose. Chinaās progress after the Open Door Policy goes beyond the realms of absurdity and others are learning from it. Malaysia has the potential to really shake things up but their government has royally fucked them.
Zep wants the US to become a communist state. He wants to be exactly what people who have suffered under are now breaking out from. I said it in the other thread. Dipshits like him donāt want the poor to advance. They just want to bring the rich down. Fuck these assclowns. They are the real cowards.
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How so? And where does all this money you were talking about in your previous post come from?
Yes as they want to limit any foreseen competition. Like I said the competition tenant is a hoax played on the gullible to make their ideology look better. However, when tried in the real world this is the last thing they want. And it is a reason to bribe politicians and lobby against something that may dent their bottom line.
M&A doesnāt occur solely because a smaller company canāt afford the FDA process, good grief.
No one buys your bullshit, Zeppy.
How so? The part about pharma acquisitions is true. The other half where you say that said acquisitions are because of a lack of cash is generally not true. If youāre attractive enough to be bought out by Gilead then you probably can continue to raise money from the public markets and go it alone if youād like to. But of course you wouldnāt like to because your entire existence is built around retiring value to your shareholders. If they have the chance to get paid a 30% premium by selling out then you have a duty to present that to them.
As far as all this money and where it comes from, wellā¦are you at all familiar with the modern economy? Because if you earnestly donāt understand then I will absolutely answer any questions you have and attach links, etc. But I suspect that you know about venture funds, public markets, private placements, et al. and youāre not really asking.
Oh, are you in for it, lol.
Just a friendly heads up, this guy is notorious for arguing with experts in their field.
Ask @ActivitiesGuy @countingbeans @Aragorn @EyeDentist @thunderbolt23 and probably 50 others. He does not care what you think unless it jives exactly with what he thinks and even then heāll probably still call you a shill at some point.
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No you just have to read closer. Maybe that is too difficult for you.