However, a burger flipper would probably much better offer NOT going to a VC firm outright. That’s a pretty big step with someone with merely a good idea.

Most entreprenuers never even deal with a VC firm, ever. There are many drawbacks that I’m not going to list now.

Most entreprenurs pour every dime they have into their idea, max out credit cards, try to beg and borrow money from family and friends, get a personal loan if the can, sell the car etc etc. At least to get off the ground, then go looking for investors.

And even then a great many entreprenurs do NOT want investors. They may need someone to make a loan but not an investor. An investor will want an equity ownership in the idea and most entreprenurs are very loath to sell equity in a new idea especially at first.

There have been many great ideas funded that were conceived of by “burger flippers”. For example, I once read that Electronic Arts signed a deal to develop a game (“Loadrunner” I think it was) based on a concept drawn litertally on a 8×11 loose leaf paper. And the story of how Oracle got its start is based on a design drawn on cocktail napkin.

While I grant those are legendary, a good idea stands on it’s own regardless of source.

BUT – and that’s the issue – an idea by itself usually isn’t enough if you plan to get VC firms, angels etc involved.

You *MUST* also do your homework!

Research your idea. Come up with a Business Plan. Show how you’re going to make whatever, how you’re going to market it, what the potential sales are, *how* you arrived at these estimates and *why* you think they are legit, etc etc.

If you just walk in and say “I have an idea for a Super Widget now give me $1,000,000 to make it happen”, get the stop watch going…

IOW, make the people BELIEVE you are serious. VC’s and private investors are by nature big risk takers. But they aren’t fools. I’ve been approached several times in my life to invest in someone’s private business. Everything from a resturant to a strip mall to a B&B. In all cases I was interested and very likely would have invested *IF* the people had done their own homework and presented themselves as serious. Otherwise it was just handing out money and I don’t do that.

Yes, I have read about VC firms and angel investors; undoubtedly you are familiar with these concepts. I’ve read enough to understand that burger flippers don’t get funded, no matter how good their idea might be.

My point about the government fail is that private business has supplies now but the government agencies do not. The CDC processes vaccine distribution requests but the CDC contracts out actual distribution to regional contractors. This is from the CDC website:
”
8. How is vaccine shipped to project areas?
CDC’s contractor for centralized distribution ships vaccine to hospitals, clinics, doctor’s offices, health departments, and other providers of vaccines that have been designated as vaccine-receiving sites by the Project Area (the project areas include all 50 states, the District of Columbia, 8 US Territories and freely associated states, and 3 large metropolitan health departments).”

So I credit this small business for getting the vaccine when many of the larger providers did not.

“We filled out our request early?”

The US government purchased ALL vaccines… every drop, so um, either they got it illegally, provided something other than the h1n1 vaccine, or when they got it from the US Government before shortages were reported (which is what I hope and suspect). Either answer diminishes the story of the entrepreneurial spirit, and you find yourself in the unlikely position of thanking the US Government for providing an opportunity to these people to help you.

Ironic.
Rick Beagle

PS btw The US government does indeed have a shortage of H1N1 vaccines, but not because of their lack of effort. The suppliers (private businesses) have not been able to meet their own quotas…. That’s right, private businesses over promised and under delivered…. So, um, get your dang stories straight.

Terry – That’s where the investor comes in. The market place is full of entrepreneurs with great ideas (and many not-so-great) and little cash, as well as people with extra cash and no ideas where to utilize it.

By getting the entrepreneur and the investor together good ideas get the finanical backing they need to get off the ground and bad ideas usually fall to the dust (and if they don’t then someone is out a lot of money because money can’t make a pile of manure smell any better).

Of course, that means a LOT of “risk”. Even the greatest idea is far from a certainty. So both the investor and entrepreneur are opening themselves up to major risk.

Which all comes back to the incentive motivation.

The investor isn’t putting money towards the entrepreneur’s idea out of their sheer generosity and good nature. The investor wants to make $$$$! So does the entrepreneur.

But when government comes along and says “If you take a big risk and does reward well then we have the right to swoop in and take a big chunk of that reward you risked for because you did well and someone else didn’t!”

That kills the incentive which in turn dries up the investor pool and squashes the ideas of the entrepreneur.