160 Attracted to the January 12th 4-Session Innovation Series Event on Capital Structure, Cash Flow, Due Diligence and More 16 CEOs, CFOs, investors & experts served up an action-packed morning of content and networking. The Collaborative hosted a 4-session Innovation Series event aimed at helping growing companies build stronger, more successful companies. This event featured four incredible panels on “Cash is King! Managing Cash in the Growth Company”, “Capital Structure and Financing”, “Crisis! Fraud! Outsourcing!”, and “Due Diligence: A Must for Financing and More”. The audience of entrepreneurs, executives, investors and students were treated to a jam-packed morning with 16 speakers and lively networking that kicked off with a warm welcome from University of St. Thomas, Opus College of Business, Dean Christopher Puto.

The first session, “Cash is King! Managing Cash in the Growth Company,” included (left to right, below) moderator Steve Soderling, Principal, Tonka Bay Equity Partners; Jeff Bajek, Vice President and Senior Credit Risk Advisor, Venture Bank; Dan Kinsella, CFO, JAMF Software; and Jamie Woell, Partner, McGladrey. The panel reviewed effective strategies for managing cash flow and leveraging cash to fuel the growing company.

“Companies that have equity are going to be able to sustain an aggressive growth pattern.  Companies without equity have no cushion,” said Bajek.  The experts gave advice on growing equity but also what to do when there are problems.  “Oftentimes you will have cash flow issues; the key is to communicate.  Let your vendors know when you are going to be late with a payment,” advised Woell.  Besides maintaining good relationships with vendors and banks, a CEO needs to know when to call in the experts to keep the growing company healthy. “If you are going to raise money, it is time to bring in a CFO,” stated Kinsella.

The second session, “Capital Structure and Financing,” featured (left to right, above) moderator Doug Holod, Partner, Maslon Edelman Borman & Brand; Jeff Milkie, Managing Director, Wipfli; Charlie Westling, CEO, Computype; and Jim Stewart, CFO, Rimage. The panelists discussed structuring the growing company for success as well as planning and financing to remain competitive in the global economy. “In early stages, equity is what you are going for in financing.  In later stages, it is debt financing,” offered Westling. Milkie added, “Institutional investors will want you to convert to a C-Corporation.  The state of incorporation is important.  The investors want the state of incorporation to have well developed security laws.” With all of the different structures and financing options for companies, valuation remains tricky.  “There really isn’t a hard and fast rule with valuation.  Ultimately it ends up being negotiated between the company and investors,” asserted Stewart.

After a busy networking session, attendees returned to the auditorium to hear the third session, which featured three topics (left to right, above) : “Crisis Management and Communications” with Matt Kucharski, Senior Vice President, Technology, Crisis & Critical Issues, Padilla Speer Beardsley; “Fraud Prevention and Forensic Strategies” with Jason Olson, Senior Manager, Forensic and Valuation, Eide Bailly; and “Human Resources Outsourcing” with Becky Woods, Vice President, Human Resources, Doherty Employer Services. Kucharski said that “the only good way to solve a crisis is to: Act and Solve Problem, Communicate and Apologize, and Move On.  Olson reminded attendees that “when you have fraud, you have an internal control issue and the best defense is a good offense.” The best offense is to “implement surprise audits and educate employees about fraud risk.” And finally, Woods stated, “The landscape for human resources has expanded and gotten so complex that it is difficult to keep it in your company.”  She explained which functions could benefit from being outsourced and which should stay in the company, along with the three types of human resources outsourcing. The panelists provided detailed outlines for the attendees.

The final session of the morning, “Due Diligence: A Must for Financing & More,” featured (left to right, above) Jeff Bergner, Partner, Deloitte & Touche; April Hamlin, Partner, Lindquist & Vennum; Jay Coughlan, CEO, XATA; Paul Knapp, CEO, Space Center Ventures; and moderator Dan Carr, CEO, The Collaborative. This panel of experts and entrepreneurs discussed the necessary process of due diligence in financing (public or private), acquisition or partnering agreement. “You’re not going to get the money unless you can do the due diligence,” stated Coughlan. He added, “It will force you to know your business like you never thought you would.”  “Due diligence begins at the start of your business with good record keeping,” added Hamlin.  She continued, “It is much easier to begin a transaction if you have these documents in order.” “From a financial point of view, if your documents aren’t in order it leaves people wondering what is wrong with the management of this company,” said Bergner. Knapp, from the investor perspective, took things a bit further, “Entrepreneurs would be well served to assemble all corporate documents – Articles of Incorporation, Bylaws, Employment Agreements, Trademarks, etc. – in one central storage file."

The Collaborative Innovation Series
The Innovation Series features 4-session events designed to give a thorough treatment of the subject matter while also relying on The Collaborative trademark of presenting issues from those who've been there. Entrepreneurs, Investors, Experts and Peers.