I think I know the answer, but what’s the question?

A client contacted us asking for help in starting a new grocery store. The first question, of course: Why?
He knew that the area was growing economically and there were not many grocery stores around. He was largely disabled, and wanted to contribute to the family income without needing to take on full-time employment.
Next question: Do you know that grocery stores require a lot of capital up front and have one of the lowest margins of any industry?
He did not know that.
We spent 45 minutes talking about his life, his family, his professional background. The salient points: He had worked for 12 years in construction, had successfully sold real estate in the area. His mother-in-law finally got into a local senior housing project after a two-year wait. There are 50 units in the housing project.
Since there was evidently an immediate demand for 100 more senior housing units, he knew how to build and he knew real estate, the rest was easy.
He found the right land, he negotiated a good purchase price, he found the right contractor, and together we found money. The client is now operating a successful senior housing project that is returning a decent profit and providing greater value for money than any of its competition.

I think I know the answer, but what’s the question?


A European client contacted us asking for help in developing a software pricing strategy to license his software.
He had developed the world’s only proprietary software to be guaranteed to reduce ocean shipping costs by at least four percent. Since some companies spend more than one billion dollars a year on ocean shipping, and several of these companies were already his clients, each paying him more than $100,000 a year for his services, he expected to do well.
The first question, of course: If these companies are already your clients, and you’re charging each of them more than $100,000, why do you want to sell the cow with a ready market for its milk?

Five minutes into the first discussion the client had dropped the idea of licensing the software. An hour later we had explored other uses for his software and landed on a lucrative one. Three days later we had developed all planning for a subsidiary to license the software from him and exploit the lucrative alternative use.

The client established the subsidiary. We developed a market approach for its potential clients. I coached the client through his first sale for $550,000 to an industry 800-pound gorilla. Two sales later the subsidiary is returning more than $2M the first year, doubling his income.

I think I know the answer, but what’s the question?


A client contacted us asking for assistance in drafting a Private Placement Memorandum to fund acquisition of a publicly-traded company.

He knew that the company was in his industry and owned proprietary software advertised as the best in the business. He had a friend who guaranteed that he could raise $3,000,000 to fund the acquisition.

The first questions, of course: What is the company and who is the friend?

A 20 minute conversation with the President of the acquisition target revealed that the company was on the verge of insolvency, the President and the entire staff were woefully ignorant of their own industry and the highly-touted software was at least two generations behind state-of-the art. Three ten minute conversations with the “friend” over three days revealed that he had never actually raised any money for anyone, and the sources whom he was planning to approach did not know him personally.
The client and I developed a business model for expanding his current business instead. His industry was mature and dominated by a few big players. Every account turned a 70% margin after the first year, but the big players consistently showed a 25% operating margin year after year. Three days of research and analysis revealed the reason for the discrepancy: sales professionals were paid a one-time commission on a sale, and then forgot about the client. Half of the clients left every year. We developed a simple solution: Pay the sales professional an annuity on client retention, and fire the sales professional if more than 20% of his clients left after the first year. I put the client in contact with an Angel investor who put together a consortium in a week to fund the expansion. Two years later, the client is 12 times his original size and showing a consistent 65% operating margin month after month.