Down With Power Audiobook!

Number 911, February 26, 2017

It’s been a week full of media lies

Previous Previous          Table of Contents Contents          Next Next

A Conversation with an Entrepreneur
by Jim Davidson

Bookmark and Share

Special to L. Neil Smith’s The Libertarian Enterprise

Author’s note: Recently I wrote to an entrepreneur that I am mentoring. The feedback I received suggested that this commentary be more widely distributed. I am offering it here.

On Due Diligence
The practicalities of due diligence are that I like to see everything, read everything, inspect all the arithmetic, examine the code, and evaluate every aspect of the business. It is my job, I believe, to be thorough, and to present to investors a detailed analysis that I can stand behind. I do not wish to encounter surprises after I am ready to speak to investors, because I want to be completely informed.

Having said those things, there are really three things a business needs in order to get substantial financial investment. Those three things are:

1. A plan to make money.
2. A team competent to implement that plan.
3. A relationship of trust with the investor or investors, such that they are confident that the people involved will diligently work to fulfil the objectives of the plan.

Now, everyone on Earth has a plan, even if it is only a plan to go grocery shopping. A great many people have plans for a business, and I think your plan stands out as well-conceived. You have a much better than average plan. Your plan shows profits. Good!

For the person who has a plan to go to the grocery store, they also have a team capable of doing so. Nearly everyone on Earth can put together a team to do some part of a plan. Most of the people who have some sort of business plan also have some people they can name in that plan. I think you have a team that is very talented and appropriate to the work you want to get done. There is no question in my mind that you and the other people involved have the credentials and talents and energy and persistence to excel. Good!

Relationships of Trust
Getting over those first two hurdles is good and good, but the third piece is vital. The most important part of the process, in my opinion, is to form a relationship of trust with the people who have the money to invest. Every business relationship begins with some sort of introduction, begins with a first discussion, often by telephone or email, and proceeds from there.

One of the things I tell people in business is to include a great deal of information about themselves in their business planning documents, even in an appendix, because the people who have money want to be able to relate to the people they are investing that money with - and feel comfortable with them.

As you may have heard, a lot of business gets done on golf courses. I have stood on golf courses and looked silly, I think, not because I enjoy golf—the name “Davidson” is Highlands Scot, but we were cleared off our land after the 1744 war and transported to “Virginia colony” in 1746. So we weren’t much for golf. Lots of people play tennis, or scuba dive, or go mountain biking, or ride horses, or have some other activity. Reading mystery novels or science fiction, all good. The point of a verbose curriculum vitae is to have lots of points of potential common interest. Places you studied, degrees you have, jobs you’ve held, countries you’ve visited even briefly, hobbies you enjoy.

If someone sees that you ride horses, and they ride horses, then they can have a conversation with you about horses, and have a good sense of who you are from that conversation. They would know about saddles and tack and feeding and grooming and riding. From that conversation they would have a sense of who you are, and how you feel about horses, and a sense of your honesty and integrity. Not because they are investing in horses with you, but because they want to have a sense of who you really are. Does this make sense?

Any scuba diver can talk to you about depth charts and pressure gauges and regulators and other gear, and if you know the lingo, get a sense of who you are as a diver. Again, not because they want to go scuba dive with you, but because they want to know you are knowledgeable, honest, and trustworthy. It is these conversations about other stuff that often make the critical difference. The goal is always to have the investor prospect say, “I like these people, they know their stuff, I can trust them with my money,” either out loud or in their own head.

So, I cannot really tell you what I want in our meeting next week, except that I want to have a sense of who you and the others on your team are, and how to go about presenting your important business plan to investors in a way that they respond with enthusiasm. The objective is to get the funds you need from people who have the funds, and the path to that destination is for me to become very up to speed on what you are doing, and for me to know what I can say about you and the other principal people on your team.

On the critical path is finding investors with whom you can form a relationship of trust, so they know that investing with you is the right thing for them to do.

Jim Davidson is an author, entrepreneur, space enthusiast, extropian, raconteur, and bon vivant. He took Heinlein’s admonition to be capable of many things to heart a long time ago, and can kill a beast, prepare a carcass for cooking, tan the hide, use the small bones for sewing, gather herbs, make fine sauces, clean a house, programme a computer, build a database, populate a spreadsheet, engage in forensic accounting, and read at blinding speed. He currently is a principal at and is planning a spectacular conference in June 2017 and an affordable one in October 2017. You can read his essays on Being Sovereign in his book by that name from, where it was briefly among the million best sellers. You can read his essays on Being Libertarian from He recently produced a 62-page draft of a field manual parody which may be obtained for free at and wherever else anarchist code geeks are posting it.

Was that worth reading?
Then why not:

payment type

Just click the red box (it's a button!) to pay the author

This site may receive compensation if a product is purchased
through one of our partner or affiliate referral links. You
already know that, of course, but this is part of the FTC Disclosure
Policy found here. (Warning: this is a 2,359,896-byte 53-page PDF file!)


Previous Previous          Table of Contents Contents          Next Next

Big Head Press