Yesterday I had a very engaging conversation with a gentleman who is running a group for inventors. I asked for the call to see if his group might be a good audience for my message about inventing an alternative to the Stock Exchange for capital formation.
The conversation covered many interesting topics, but as to my point, above, it went pretty much through three phases.
PHASE 1: All the money comes from Venture Capital and that is not how they do it.
PHASE 2: When it comes to investing, everybody always focuses right away on how to get out: exit-by-sale.
PHASE 3: That's not really what Investors want. Investors want to protect their principal and generate cash flows to meet their own program goals. Pension Investors, for example, whether self-directed or Institutional, want to protect principal and earn cash to meet the living expenses of their retirees. Endowments want to protect principal, and earn cash to pay the costs of advancing their chosen cause. Insurance wants to protect principal and earn cash to pay benefits to their policyholders.
If you think about it, that is what Enterprise wants also: cash to run a business that will generate even more cash.
So why can't Enterprise and Investment get together, directly, to agree a deal that will give Enterprise the money it needs to runs its business, and give Investment cash flow to meet its programmatic needs (and maybe a little extra, to build wealth along the way)?
An interesting question.