Here are some of my thoughts and ideas regarding my target market, namely entrepreneurs and start-up companies.  I hope that you find them thought provoking as well as helpful and relevant.

If Cash is King, who is Queen?  Part 1

Posted November 13, 2010

I remember talking with a finance guy many months ago at a small company.  The company was in coping with several issues and I had been asked to opine on the financial condition of the company.  We started with a brief review of who he was, who I was and who the company was and why it was thought that the company had serious financial issues.  It was not too long before I had to listen to the “it’s not my fault you know; they just don’t listen to me” line of reasoning.  What could I say?  The jury was out as I had only met the guy a few minutes ago and knew just a little bit more about the state of the company.

We moved on and refocused on the current financial statements.  I asked him to lead me through the statements and comment on his observations.  We started with the P & L statement.  It is interesting to me why this statement is called a P & L, it should be P OR L, shouldn’t it?  It is also interesting why most people start a financial review with the P & L.  Is this where we see the keys to the company’s financial condition?

After a few minutes we moved on to the Balance Sheet.  The first number that I saw, top left hand side was negative.  Hmm, negative cash!  They were holding checks!  He explained that they had to and went on to tell me that in his world “Cash is King”.  I appreciated his insight, looked at him and asked…”Thanks for telling me, but now I am curious; if Cash is King, who is the Queen?”

Umm…we moved on and talked about Accounts Receivable.

If Cash is King, who is the Queen?  Part II:

 Posted November 22, 2010

So who is the Queen?

Throughout the land, people were consumed with this simple question and speculation was rampant!  Cable news was obsessed with the question; the Fence Lane Reporter showed great interest but sadly the main stream media ignored the story; selective journalism I suppose.  The court jesters jested, the pontificators pontificated, the bloviates bloviated; the wise became less wise and the elites lost their luster.  Nobody could answer the question! 

It was up to the King.  He would decide, he would soon announce to all of his subjects.  In his kingly wisdom, the King set the date and the venue.  He would announce to the whole land at Caernarfon Castle (a magnificent old castle in my home town).  We would all just have to wait!  Rumors spread that the King was determined that the Queen of choice would be such that royal lineage would be assured.  After all, a going – going concern was highly prized.  Time would tell!

Cash is King…long live the King.

 

If Cash is King, who is the Queen?  Conclusion:

 Posted November 30, 2010

Long live the Queen.

The Queen?   Queen who?  Who would be deemed as being the most suitable to rule with King Cash?  Having a King Henry VIII mentality, King Cash was obsessed with his legacy and the need to ensure the continuity of the Cash dynasty and resulting Cash lifestyle.  He desperately needed a male heir!

The King explained that his selection process had led to his thinking “outside of the Balance Sheet”.  He was even thinking “outside of the Financial Statements”.  Maybe no financial metric would measure up to his expectations.  What…a commoner?  The King would select a Queen with no financial lineage?

The accountants and official keepers of the purse were horrified.  They would be expected to pay homage to “Queen NON Financial Metric”?  Would the King reach into the house of Sales; Production; Marketing; Technology; or maybe even academia?  What would be the logical, or maybe even the most illogical selection?  Who would King Cash chose?

Long live the Queen…Long live Queen Market Share!

Three years later, the partnership produced:

Long live the first heir…long live Prince Cash Flow!