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DECEMBER 31, 1999

DEAR DIARY

My Fantasy of VC Investment Inches Closer to Reality
The prospect is scarier than I thought


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Last week, two actual venture capitalists asked me to send them my plan to turn my real-world editorial staffing company, Staffwriters, into a dotcom. I thought no one would be interested until I'd pounded on several hundred doors and wore out my knee pads begging. Now I'm beginning to think we'll have to list our potential investors on a spreadsheet to keep them straight.

Was it beginner's luck? Two neatly dressed businessmen who happened to be in the neighborhood stopped by to talk about our company and the strategic partners we share office space with. My operations guy and I talked with them for all of 15 minutes. The next day one of them called to say that he wanted "to get the process started."

After that, to my surprise, a huge lump started to form in my throat as I realized how much my business would change with outside investors. My private realm will be bigger, and richer, but I wouldn't rule alone anymore.

The thought of giving up equity does upset me. I know: a medium-size piece of a big company is worth more than an extra-large piece of a smaller one. Yet, I've seen company founders turn sour over the control issue, and I don't want that to happen to me.

Then there's the likelihood my venture-capital knights will depose me and put a president in. That makes sense. It's too much to keep running everything. But should I be the one calling the shots or my investors? There will be regular board meetings. I hate meetings, and venture deals generally mean tons of them. I'm afraid I'll just lose patience and blurt out some silly remark.

Then there's the ultimate fantasy: Going public. Not that I'd mind becoming an IPO billionaire. Still, if it bugs me to answer to a few VCs, how am I going to feel about being held accountable to a million or so strangers who mainly want to see the share price increase at the rate of several hundred percent a quarter?

I'm getting ahead of myself here. No one has made me an offer. Still, part of me clings to the romantic ideal of building a wildly successful business with my own resources. I know it goes against all the received wisdom of the moment. When the moment comes, and those fellows in the business suits whip out their checkbooks, my gut will tell me what to do. Hopefully, I'll be able to read the signals — I wouldn't want to turn down a couple of million bucks on the basis of indigestion.


George Giokas is the president and CEO of StaffWriters Plus, a specialty agency that places writers in temporary and permanent positions with corporate and other employers. It also provides editorial consulting work. His database includes 2,500 writers and editors specializing in more than 60 categories. His Web site is located at www.staffwriters.com, and you can E-mail him at george@staffwriters.com
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