Wealth Management

Voted #6 on Top 100 Family Business influencer on Wealth, Legacy, Finance and Investments: Jacoline Loewen LinkedIn Profile

October 29, 2008

The Canadian Dollar is Ridiculously Undervalued

The storm is passing over according to a financial expert who called the Wall Street melt down in July, 2008.

"I think we're ending the financial crisis now," said Krishnamurthy Narayanan who studied under Paul Krugman at MIT and runs CI Global Opportunities Fund has returned 57 per cent in the past year, 19 per cent (compounded) over the past five. "
There will be countries, like the U.S., that will go into recession. But this need not be a global recession. And there are some encouraging signs on that front."
Narayanan was in Toronto and said he's buying Canada - the dollar, the oil, the companies. An excellent story in the Globe and Mail by Derek DeCloet ddecloet@globeandmail.com, October 25, 2008.

"The Canadian currency is ridiculously undervalued. I can't think of any country in
the world that has no fiscal deficit, no trade deficit and no inflation - except Canada. I think the Canadian dollar should go through parity. I like the whole Canadian market. I don't particularly dig the banks because I just don't know what's in there [on the balance sheet]. But I'd say virtually everything else is fine.

October 28, 2008

Canadian SMEs Need to Partner Up

"If Canadian companies want to survive the global economy, most current SMEs will need to find a partner to grow," said Jean Rene Halde, President and CEO of Business Development Bank of Canada. "Most SMEs - small and medium sized enterprises - are just going to need to get together with a competitor and partner."
Halde spoke to the Canadian Club of Toronto, October 20th, and explained that the new economy is no longer a small aquarium with room for many small fish. Imagine taking that aquarium to the ocean and now the fish can choose to stay in the glass box, even though the top is open? If they do leave their artificially safe old home, they will need to be a bigger size to avoid getting eaten.
With the Internet and global business borders, the world of commerce has jumped in size. SMEs will need to find suitable partners to buy. This next five years, companies will need to double or else close their doors. Find private equity to support your growth and help guide you out of your comfortable spot in the aquarium and out to the big sea.

Even Kevin Would Agree

I have been asked to blog for CBC's Dragons' Den, the Venture Capital reality TV show. It is a change from my usual writing style as the audience is different, so please take it with a big pinch of salt!

Every now and then, investors will take a punt. In other words, they put cash on a deal with the off-chance it may do well and spin off rich returns. This week, the Dragons played the lottery but also shared their appreciation for the finer elements of life – the Arts – by supporting two sensitive souls asking for $10,000 to complete their film project. Did these producers get lost on their way to the Canada Council for the Arts who gave a grant to the movie Young People F***ing. Then why not give a grant to a movie about a Canadian’s journey to the Playboy Mansion?
Of course, Dragon Arlene Dickinson grasped the marketing genius of these two artists who knew that by appearing on TV, they would build advance hype for their movie titled My Date with Hugh and expose it to a wider audience of highly intellectual and attractive Dragons’ Den viewers.
Dave, the producer, handed a card to the Dragons which had the list of movie stars appearing in the movie (I’m assuming in cameo roles). Suddenly, Dragons Kevin O’Leary and Robert Herjovec went into a feeding frenzy. But who’s names were on that list? Madonna’s soon to be released husband, Guy Ritchie? Perhaps Brad Pitt taking a break from Angelina and the kids? “Hi honey, I’m just stopping in to see some friends. Don’t wait up, love ya.”
That list also got W. Brett “Clint Eastwood” Wilson to briefly clench his jaw.
Brett approaches his deals like entering a bar room. He swaggers in, expressionless, and just when you think things are going swell, he whips out his six-shooter and blows holes in the deals. There went Herjovac’s offer of $25,000 for 25% of the business.
This left O’Leary spluttering, confused and annoyed,
“Why Brett, why? Why be a Bozo?”
Oh dear, using clown names on a big boy from Saskatchewan* – not good for building long lasting relationships. It just begs the question, did Kevin’s mother ever teach him about manners?
If you are pitching for capital and you find yourself in Dave’s delicious position of having investors start a bidding war, follow Arlene’s advise and ask what each investor group can do for you besides the money. Kevin claimed he had invested in a movie distribution company which made Dave rub his hands together and begin to drool, but Arlene warned that there was a strong whiff of bull manure in the air. Perhaps Kevin was invested in Disney - who knows - but Dave sure did not care and went with Kevin and Robert, leaving Arlene and Brett to twist in the wind. I suppose Kevin is more the target audience and Dave probably imagined himself having A Date with Kevin, drinking beers in his kitchen with the Explosion Bottlecaps and doing other manly pursuits. Yet, Arlene’s marketing ability may have created a more nuanced marketing campaign. Also, Kevin did confess to having an abysmal track record with movies.
There were two more artistic deals – fashion for plus-sized women and jewellery which Hollywood Stars are buying. What’s it with Hollywood? Why can’t we hear that Melinda Gates loved the necklaces?
When Cindy and Rina of Maximum Women described how they stay up into the middle of the night to make calls and do research, Jim Treliving appreciated that entrepreneurial craziness saying he did the same thing as he built his own business. Yet, Jim got the sense that Cindy and Rina knew what they were doing and cash would be used wisely. Arlene asked for 50% ownership, along with Brett and Big Jim. Despite the promise of long, dark, snowy Saskatchewan nights heating up with Brett stopping by for a hot chocolate beside the roaring fire, Cindy and Rina turned down the Dragons’ deal. Robert teased Arlene; finally, someone had stopped her from stealing their business.
The jewellery game is fickle and Kevin did a great job of questioning Rachel of Hillberg and Berk Jewellery but she convinced Brett to invest. The lesson here as that Rachel really knew her numbers which gave confidence that she was CEO material and not a one-product-person.
The best pitch came from Tom with dataSentinel who broke a laptop and then held out the USB key to access the up-to-date files stored safely on the Internet. Masterpiece Theatre could not have done it better and even someone with the abilities of a gherkin could understand Tom’s product. Too bad Robert broke the drama by saying the technology was already in the marketplace.
Robert asked if Tom had received government grant funding and when he confirmed this, Kevin asked for his tax money back.
The CBC and Dragons’ Den is also funded by tax dollars. As Brett pointed out, “This country is built by entrepreneurs” and with small and medium enterprises (SMEs) generating 60% of Canada's economic output and providing 80% of Canadian jobs. There is no doubt that the Dragons and the entrepreneurs who enter their Den teach a great deal about how investors reward innovation. If we want to strengthen our Canadian economy, the Dragons’ Den is a truly fantastic investment of tax dollars. I think even Kevin would agree.

*Mea Culpae: Brett is actually from Saskatchewan, not Alberta, as I have stated in past blogs.

J. B. Loewen raises capital for companies wanting to grow and is the author of Money Magnet: Attract Investors to Your Business.

October 20, 2008

You Made Money From That?

I've been asked to blog for Dragons' Den. Here is episode 4:

This week’s Dragons’s Den had me gripped – and it wasn’t just by the pitches but the interplay between the Dragons snapping at each other. As Robert Herjovic and Brett Wilson manoeuvred Marissa, owner of Moxie Trades, towards a deal, each of the Dragons took turns chipping at the opportunity. Kevin O’Leary had on his MBA professor hat, explaining how more products means way too much complexity for an early stage business. Unless Marissa sticks with shipping only boots, the SKUs (stock keeping units) will mushroom horribly and as Kevin said, “Marissa will find herself in the world of hurt”. Showing again why she gets paid the big bucks for marketing, Dragon Arlene Dickinson labelled Moxie Trades’ products for females in traditional male jobs as “badges of honour”. Brilliant - but before I could absorb this feel good moment, Kevin had kicked out with his hobnail boots of reality and inquired about the money. Ah yes, it always comes back to the money.
Brett Wilson picked up the theme and asked, “What is the margin on your boots?” When Marissa said around 30%, there were quite a few Dragons trying hard not to look too impressed. Kevin does know his industry metrics and let out that those margins were significant.
It was Big Jim Treliving who tipped over the Dragons’ negotiating table, telling Marissa not to make the deal, leaving Robert to blurt out with a blinding smile, “Damn you.” Gosh, Herjovac makes even his bad moments seem wonderful. He has enormous emotional intelligence in his dealings with people, particularly during awkward moments. Indeed, Robert gently asked Arlene to clarify after she said she did not want to do the deal with him. Actually, she meant the deal structure did not appeal. I also admire the way Robert sets out his boundaries telling other Dragons to make a deal or get out, but in the most charming way that only James Bond (or perhaps Robin Williams) could possibly top. No bridges were burnt with Marissa and we learn that this deal will return in a later show.
The Nails ‘n Martini presentation demonstrated how far you can get with investors when you realize that pitching is more about debate. Actually, the entrepreneur, Martin, approached pitching as a social encounter at The Devil’s Martini Club on Adelaide Street.
As you know, investors put money into people. With Martin, the Dragons recognized a positive, upbeat, outgoing personality and spent the time unpacking his concept even though he had neglected to do much of the work himself. You can see how the partnership between innovator and venture capitalist works. The Dragons bring financial competence, price out the dream and keep everyone grounded in realty. Big Jim is familiar with building a service business one city at a time and then moving down to the USA. Jim shared that the American market place is tough and that he got his “tail shot off.” This is exactly the kind of partner Martin should have in his business to guide him past the rocks and the hard place. Jim’s been there already.
Arlene told Martin she could drive a bus through his plan, particularly the costs. Martin dismissed her feedback saying he already gets money from his wealthy relatives. Hope they weren’t watching because my guess is that they will be putting a stop order on any more cheques. Martin reminds me of a teenager who racks up the calls on his parent’s cell phone and when the monthly bill arrives says, “Whaaaat? I didn’t know.”
Each week, the Dragons astonish me with their openness to listen to zany characters like Martin and to put their money into ventures. Innovation sure happens in strange, unbelievable places. Wouldn’t we all love to invest in a growing business and make money but how many of us could even spot a diamond in the rough? Last week, I was reminded of the crazy quirkiness of innovation at an entrepreneurs’ award ceremony. Lo and behold, the competition winner was a man who started on the streets of Montreal, walking on stilts while eating fire - Guy Laliberté, the founder of Cirque du Soleil.
Zut alors! Turns out, I worried needlessly about Brett Wilson’s sanity when he invested in Alison and her street circus business, Arial Angels. He may have actually done a pretty wicked deal by putting cash into what seemed a flimsy business concept. If a fire eater from Montreal can trade in his stilts for a business suit and finance partners – well, we can see that the world truly can become his stage.
Memo to Alison of Arial Angels: get hold of the book Blue Ocean Strategy which lays out how Cirque du Soleil reinvented the circus business model and beat the industry giant, Wringley Brothers. Then buy a navy blue suit and wear it. Robert Herjovic gave you the best advice for free – become a business person, do not remain an artist. Laliberté accepted his award wearing a suit and spoke about his financial partners, not a word about fire eating.
I’m becoming quite fond of Dragon Brett’s style and how his investment strategy involves so many elements around people, innovation, risk and reward. Maybe Big Jim should follow the Albertan instead of O’Leary. One thing I know: where there’s a Dragon’s Deal, it’s genius.

Jacoline Loewen is the author of Money Magnet.

October 17, 2008

Capital without Draining the Pool

Q: Why do business owners often sell their healthy business just to achieve some personal liquidity?
A: Because they are erroneously advised that they have no alternative.

Just because a business owner wants to achieve some personal liquidity doesn't mean he should lose the opportunity to run his company and share in its financial future. Unfortunately, all too often owners are told exactly that - they must sell their company to meet their objectives, resulting in both a loss of operating control and their opportunity to share in future growth. John Loewen says, "Business owners need to find a partner to guide them towards alternative liquidity solutions that allow business owners to preserve management control and substantial equity ownership."

It may be hard out there but many private equity funds have capital to invest in great companies. Do not think that selling is your first option - it's often the last. J.B. Loewen's book called Money Magnet describes those options in easy terms.

October 15, 2008

Peer-to-Peer: Readers' best advice about patent protection

Profit magazine has listed as a must-read for buinsess owners J.B. Loewen's book, Money Magnet: Attracting Investors to Your Business in their September magazine. In their article on how to get your intellectual property patented, Profit gives away a free copy of Money Magnet. Check it out as the advice is given by readers and I know one of the entrepreneurs.

There is No Need to Be Rude

Some people think the Dragons should be kinder and gentler with the entrepreneurs who dare to ask for their gold. One Dragons’ Den blogger wrote, “I think it is great to be honest with the investors but there is no need to be rude. It doesn't add to the entertainment value, just the opposite.”
I don’t think this fan is referring to Arlene Dickinson, Robert Herjavec, Jim Treliving or W. Brett Wilson – although Brett sure can crack the bull whip and we are only into the third episode; so let’s circle the wagons and get back to him later. For now, I have a hunch that this comment on rudeness to entrepreneurs pitching on Dragons’ Den is attributed to alpha-Dragon, Kevin O’Leary. What if the CBC recommended that he follow Tony Soprano’s example and sit down with Dr. Melfi to work through his anger issues? How do you think it would go?
Dr. Melfi begins, “Kevin, so you say you have a lot of money?”
“I’ll say. Don’t you know I’ve made four billion dollars? Not a million…four billion.”
“OK…and you’re on a TV show?”
“Yeah. Dragons’ Den.”
“Catchy title.”
“Who Wants to be a Millionaire was already taken. I suggested Who Wants to be a Billionaire but the CBC producers wouldn’t run with it.”
Dr. Melfi continues, “Perhaps we should talk about your behavior. Now Kevin, most people would be thrilled to have your success but some viewers complain that it’s distressing the way you grill those poor, brave entrepreneurs. I mean…on this last episode you called that man from Eco Anti Freeze a cockroach.”
Kevin sighs, “First of all, I asked him if he was a cockroach and that’s because I liked his business. I need to get him worked up, see how he reacts. Hey, when it comes to your own investing, money can disappear pretty quickly. You may have noticed the stock market?”
Dr. Melfi shudders, “But the point is - you could be nicer.”
“The point is to see if I like the guy because if I invest, we become partners. Besides, even Robert Herjovec told the guy he had an edge.”
“But he said it with a smile. Perhaps you could channel your anger like that?”
Kevin raises a valid issue that when you raise private equity capital, it is all about partnership. When the Dragons invest, it is not like a bank loan which is passive. It is venture capital which means the Dragons are giving money for a piece of the business to become an active partner. They need to get into the boat to row with the entrepreneur for five years and it is known that some investors will rile up an entrepreneur to assess their personality. Character is important as the Dragons will introduce the entrepreneur to people in their network and that reflects on them. The Dragons will meet the entrepreneur frequently, build the strategy, phone him and trust his business skills. The Dragons must be confident that they can get in that row boat together and pull the oars in the same direction. That’s the point.
It does not take away from the fact that pitching your business deal is very hard whether you are on TV or not, and can be underestimated by the majority of owners wanting to raise capital. The two fellows with Eco Anti Freeze are an example of how quickly a presentation can go from good to grotesque. Jim Treliving owns Mr. Lube which is a client of Eco Anti Freeze in Vancouver already, and it was obvious Jim was pleased that the team had done their homework about his possible interest. Recycling of chemicals is a growth business so all the Dragons looked interested. Unfortunately, when the questions began, the wheels came off. Fair or not, you need market data to back up your statements or at the least, to try and give a response. There is no doubt Eco Anti Freeze will find an investor if they allow financial partnership in their overall company, not just Ontario, and they work on their market analysis. Rest assured, they will live to see another day and do well.
Compare that presentation to Darryl with the Buster Rhino BBQ sauce. As he presented, Darryl took on the questions with flair. Although he also lacked numbers and was sketchy on the use of investment money, Darryl made it clear he would be a fair, flexible partner. As Robert Herjovic and Brett Wilson told Darryl as they handed over a cheque for $200,000, “That was not the sauce, that was all about you. That was wonderful.” So Darryl will be grillin’ and chillin’ with the Dragon team because he kept his head and they liked his attitude.
“Kevin,” Dr. Melfi continued, “Can you empathize with these business owners risking their reputations to come on TV and show what is close to their heart – their business?”
Kevin leans forward, “Agreed. But when is the normal entrepreneur going to have five top experts focus on their business? Never! What about the millions of people watching – someone’s going to like what they see even if us Dragons don’t. Past presenters have gone on to raise capital – last year there was a group who raised millions after being ‘distressed’ on the show. Wish I’d had the Dragons’ Den opportunity – I would have jumped at it.”
“Even if it made you look like an idiot?”
“Absolutely! To get that kind of television exposure is worth it – yes, even if you look goofy. You’ll be so much further along than if you’re still in your basement thinking your product’s going to change the world.”
“But couldn’t you just say ‘I’m out’ without slamming them? You told one nice presenter that you would rather put needles in your eyes and let a truck run over you. I’m concerned about how you are damaging your reputation and embarrassing people.”
“Listen lady – a lot of people told me I was crazy. Did I cry? OK…a little but that stays in the cave. I listened. I asked questions. I learned. I adapted. I changed my business. Do you think I got to where I am without pain? I had the sweats. In the middle of the night. For years! Does anyone care about that? Nooooooo…”
Dr. Melfi glances at the clock, “Well, Kevin, that’s it for today –same time next week?”
J.B. Loewen raises capital for established companies and is the author of Money Magnet: Attracting Investors to Your Business.

October 13, 2008

Private Equity Fund Raises $980 Million

Sequoia Capital spent last week presenting to the private equity investment community and warning about how difficult it would be for fund managers hoping to raise money to invest in businesses. Turns out that raising capital for a new fund was not so hard for Sequoia as they announced that they had $980 million for their new fund. John Loewen says, "Not bad for such trying times. Much of that money is earmarked for BRIC countries but I would not be too quick to write off the Americans. Remember back in the 80's Japan Inc was supposed to take over the world."

Lehman Brothers Go-Slow Strike

October 10, 2008

O'Leary's Not Buying It

“This is a really, really bad idea.”“You’re crazy.”“You will end up going to the forest and slitting your wrists.”
These were vintage lines from the fieriest Dragon gazillionaire, Kevin O’Leary, who is to Dragons’ Den what Simon Cowell is to American Idol. Kevin says the things we are all thinking at home but would never dare to say to someone’s face and it’s what sets him apart as an investor. Like Simon Cowell, Kevin’s words may sting but not as much as spending $700,000 of your own money and ten years of your time without making a dime of profit – like the Dolls House kitty litter guys. That’s sad. Imagine if they had met up with the CBC Dragons back then, got a blast but listened. Maybe they would have changed their idea or found a job with Purina. Today they would have a healthy RRSP and bank balance instead of looking as if they’d sucked back a mouthful of Buckley’s cough medicine.
Ditto to the cute lady with her Bubbles the Dog book, the pizza box guy and the white-suited bee exterminator. As the marketing Dragon – Arlene Dickinson - quipped, “Bee gone!”
Dragons’ Den is back with a vengeance this season offering intrigue, drama, cruelty and redemption – better than any soap opera because if you listen to the Dragons’ questions and, yes, to Kevin’s digs, you cannot help but learn.
Dragons’ Den is back with a vengeance this season offering intrigue, drama, cruelty and redemption – better than any soap opera because if you listen to the Dragons’ questions and, yes, to Kevin’s digs, you cannot help but learn.First up (excuse the pun) was Fit to Touch, - a rather suggestive exercise program to do with your loved one, and if you have a friend but you are not a couple, do this program a few times and you will be. Although most of the Dragons chuckled and cringed, big Jim Treliving was interested because he had connections who could commercialize the concept.
In any developing business, no matter the industry, you need to translate your ideas into sales. In other words, how are you going to get customers to take money from their wallet and give it to you? Until you get healthy revenue you will need to depend on infusions of money: investment capital. In other words, cash from investors like the Dragons.
Kickspike, a golf shoe with retractable spikes, attracted the most money ever invested by the Dragons – one million dollars! What was so special? First of all, it is a sports product which speaks to all the Dragons. The shoe was easy to use and could be rolled out to a far wider market such as construction boots, seniors’ walking shoes and any sports shoes with cleats. Also, the designers, Colleen and Darrell Bachmann, were smart enough to take out a world-wide patent. With all these stars aligned, the Dragons recognized a good deal. Even the new Dragon, Brett Wilson, a brooding Clint Eastward from Alberta, broke character and actually got excited.
During the final deal, a computer interface that a senior could use to read emails, the full range of investor emotions ran across Robert Herjavec’s face. First, the realization that here’s a darn good product that could make a buck but quickly moving to the horror of how much it could cost to take it to the consumer market. As Robert said, almost to remind himself, “I could run through all of my money and still not have made a dent in the consumer market.”
Exactly. As Kevin pointed out, you have to calculate the cost of client acquisition. Then savvy Arlene shifted gears by reaffirming that the size of the seniors’ market was worth the effort and there were ways to reduce the cost of education by piggy backing the software with companies already serving the over seventies segment. With that, Robert and Arlene were in.
Getting back the invested cash – never mind a profit – from your investment is very hard. This is where watching Dragons’ Den is worth your time if you want to understand the mind of the entrepreneur. Kevin said he spent fifteen years battling in the trenches of the consumer marketplace. That is a long time being knocked down but getting right up again to push forward. It is where Kevin made his fortune but he told the other Dragons how he suffered nights waking up in a cold sweat and he ain’t goin’ back. With that, O’Leary said, “I’m not buying, I’m out.”

The CBC invited Loewen & Partners to be a guest bloger for their financial reality TV show, Dragon's Den. Jacoline Loewen raises capital for companies and is the author of Money Magnet: How to Attract Investors to your Business.

Please tell me you have some sales

The Dragons looked stunned when Paul with the plastic doo-hickey that rolls up the rim of a paper cup said he had sold 200,000 of the things and had made $100,000. With the detailed description of sales achieved, energy swept through the Dragons and they each piled in with their ideas about the potential market. It was exactly what Paul said he wanted – a brain storm with smart entrepreneurs- although he did also let slip that his friends tell him, "You're crazy!"
Kevin O'Leary agreed, "You're crazy but you're crazy like a fox." Glad Kevin's a Simpsons fan but when asking for investment money, save your psychological confessions for when you've made the front cover of Profit because that streak of eccentricity could make your potential investors a tad nervous. Even the kindly Robert Herjovec said, "Paul, it's over."
Moving on to the ideas that amuse us armchair Dragons, there was one gentleman anxious for Canadians to make his symbolic head gear as instantly recognizable as the sombrero. Guess he's not heard about the Mounties' hat made famous by Dudley Do-Right, or Paul Gross in Due South and he must have missed that law suit where the Mountie preferred to wear his turban. We got a sense that Brett Wilson, the new Dragon, like Clint Eastwood, would have liked the idea if it had involved a big cowboy hat with a black cigar thrown in for free. Now you're talking. Someone said that Clint Eastwood has two expressions – the one with his hat on and the one without the hat. Likewise, Brett has two expressions: one when he wears the next Canadian headgear – the "duck foot" hat - and one when he doesn't.
Then the ladies from No Smudge Lipstixx were a little alarmed to learn from Kevin that they were in the most competitive industry from hell and that their competitors would blow their cars up in their driveway. Yikes! Kevin's comments reminded me of when I was at university, we had a Friday night party where we watched Charles Bronson movies and every time Charles killed someone, we all had to take a drink. I think Dragons' Den could package a game where every time Kevin says "you're crazy" you take one swig of beer and "you're an idiot", a shooter of tequila and when he makes someone cry, you get to wear the "duck foot" hat.
When a teacher with language software arrived, Kevin groaned, "Please tell me you have some sales." Yeah – half a million dollars worth sold from the basement of Catherine's home. Kevin and Robert Herjavec agreed that it is unique for early stage software to have such a good level of sales.
I'm a huge fan of Kevin and the sheer exuberance he brings to Dragons' Den. Someone has whispered in his ear that he's not always super nice but as he says, life is tough. Kevin says it aloud and when people let their stress rise, they miss what Kevin is needing from them. When pitching, expect your heart to pound and give yourself something to calm down. Hold your lucky rabbit's foot or breathe slowly.
I would prefer to deal with someone like Kevin who lays his cards out and gives the entrepreneurs clues to what he needs to hear. He told Catherine he cares about the children which got guffaws from Robert, but if Catherine had been paying attention, she should have jumped in with statistics about the children using her software. Instead, she didn't give even a smidgeon of numbers. She left Kevin remembering his purgatory of life in educational software and swigging back what looked suspiciously like scotch, from his water glass.
Jim Treliving piped up that anything Kevin O'Leary likes, he's interested in coming for the ride too. Poor Kevin has to piggyback the other Dragons and they are making his deals more competitive by bidding up his offers. With the dramatics over, Arlene snapped up that deal at half the value and Big Jim did not join her. Unlike Kevin, Arlene walks softly but carries a big stick. Did the Dragons know that she made her original money by investing in educational software? Catherine, did you hear Kevin say Arlene's ripping you off by stealing half your company?
At this point, my son flipped his laptop over to me to show Catherine's software. He's just started Spanish this term but can already say a few phrases, seems to be handling the vocabulary and is actually enjoying it. As an anxious parent, I have wondered how he has managed to survive. Turns out the teacher gets them to do mini tests on the software as a treat which means my son has already done many quick quizzes to test his Spanish. Compare that to the two tests he may have done with a traditional classroom teaching method. That's hot – which brings us to the end of the show – the mini street Cirque De Soleil called Aerial Angels- two dynamic women with a sizzling street act.
Again, Kevin told the street acrobat, Alison, she was arrogant, did not listen and forget about the crying crap because business is no place for tears. Robert as usual, saved the day advising Alison to decide if she was an artist or a business owner – the same business attitude blocking Catherine from earning the profits she deserves.
Suddenly, from the shadows Brett spoke up, "Alison, I love your passion. I'm in."
The other Dragons looked at Brett as if he had confessed to being scammed by a Nigerian email.
Dear Brett,I am writing to you with a matter of great urgency. My beautiful acrobatic auntie has expired and I need to send her bank balance to an Albertan account. Please show your compassion and tell me the details of your bank account. We are absolutely keen to meet you too, but you can send a blank cheque as well, if you prefer.
Had Brett taken to heart Big Jim's earlier advice to the "roll up the rim" fellow to get a good lookin' gal and sales would soar? I'm with you on that Jim, and Richard Branson of Virgin definitely buys the Treliving marketing theory: There's no doubt that in the right situation, looks do sell. But perhaps Arlene laughed wryly because these are exactly the reasons that women think men in business can be manipulated – how smart is it to make decisions using your libido?
After this show, Brett will be smiling as he specializes in entertainment and knows how to make money with these talented artists and Arlene got a slam dunk with her software deal. Albertans are a mysterious, quiet bunch but they're the ones in Canada with the growth economy, making the money.

CBC invited Jacoline Loewen to blog for their reality TV Show Dragons' Den. Loewen raises capital for companies and is the author of Money Magnet: How to Attract Investors to your Business.

Continue reading at Dragons' Den at the CBC

October 8, 2008

With a Name like Schmucker's

Are you afraid that your family business will be taken from you if you partner with private equity? Mark Schmucker is the fourth generation leader of Schmucker and was recently in Toronto giving a presentation about how the family business mystique pays off in sales.
Mark showed advertisements from the 1960's which could play today just as successfully with their emphasis on family living, green lawns and a plate of jam sandwiches.
Mark says that in the early 90's, during the big market downturn, his father and uncle made the decision to bring in private equity partners. At the time, the Schmucker business was not doing well and there were family issues too.
With the help of partners (not just lenders) who put in cash but also brought a great deal more, Schmuckers began their growth tract by starting off buying Jiffy peanut butter. Mark says at first the family thought the spread into breakfast foods seemed too ambitious and peanut butter seemed crazy, but today they are happy because they own 8% of a billion dollar company, fifth in their industry.
Not bad.
Jacoline Loewen's book, Money Magnet: Attracting Investors to Your Business, goes through this challenge for business owners to decide if they want to be in control or get wealthy - lifestyle or legacy. Schmuckers chose to go with "get wealthy" and found out what thousands of family businesses have learnt: giving up some of the company to private equity partners results in a lot larger amount of money.
John Loewen says, "bringing in private equity partners to a family business is probably the smartest plan if owners want to pass along the wealth of the business to future generations. Like Mark Schmucker, you do not need to won 51% to have control of the company and private equity gets the mystique of family businesses."

October 1, 2008

Globe & Mail Tells How to Get Ready for Investors

Are you getting ready to find investors to partner with you in your family business? Listen to this podcast on Report on Business, Globe & Mail, with J. B. Loewen, author of Money Magnet and a partner with Loewen & Partners.

Private Equity Includes Dragons' Den

Dragons' Den, the CBC's hit reality TV Show, is a glimpse into the world of private equity. You can get a good feel for how private investors react to entrepreneurs relying on attracting their funding.

Private equity actually means privately held money - money not invested into the public markets which are open for all. With the IPO being a bad choice due to to the onerous costs of SOX and the bubbles now happening more frequently and with larger ups and fast disappearing "pops", private equity is finding itself to be a welcome option for business owners.

Jacoline Loewen, author of Money Magnet and partner with Loewen & Partners, does some blogging on Dragons' Den and points out the business lessons to learn as these millionaires react openly to entrepreneurs.