Will you invest in my company?
No. We actively manage and maintain governance control over our portfolio companies in the initial years of operations. If you already have a company, then you are too late for us. When we say we come in early, we mean it.
Do you provide consulting services?
We are not consultants. We solely co-found companies and then actively manage them. That said, we’re a friendly group and if you are in the Baltimore region, you shouldn’t hesitate to give us a call or stop in for some free advice. We all win every time a Baltimore entrepreneur is successful.
How much do you invest?
Our big advantage is that we don’t write a check into our portfolio companies for equity. Take a look at our “What We Do” page. We do almost all of that investing within Early Charm – not within our portfolio companies. This allows us to optimize the use of dozens of field specific experts across our entire portfolio. By keeping all of those people employed through Early Charm, we gain economies on HR management, benefits plans, standardized systems and, most importantly, on finishing tasks “assembly line” fast.
How do you manage so many companies?
We have fewer businesses under management than many Fortune 500 companies have business units. Like the Fortune 500 C-suite, our senior management sets strategy, allocates resources, provides mentorship, builds partnerships and presents to the public. Then our Associates act like business unit managers of Fortune 500 companies. But, all at a smaller scale and, frankly, a much easier scale to manage.
Doesn’t a startup need 100% time commitment?
There’s this storyline of the lone entrepreneur that mortgages the house, borrows from friends and family, fights against all the odds and occasionally (but rarely) prevails. When it works, it makes great headlines and builds the myth that doing it that way is a good idea. When it fails, which is almost always, its hidden from sight and people just write off the entrepreneur as a failure.
We know that model is dumb. By having a highly skilled team with established business processes and institutional knowledge gained by doing it over and over, we get the company up, running and funded in a fraction of the time and with almost no risk.
What’s your exit strategy?
We’re all about building a sustainable business. We don’t consider who is going to buy us out or how we are going to IPO for the first three years of operations. After that we choose the right path based on the character of the business. In some cases, this means restructuring the business to accept venture capital. In other cases, it means creating a strategic partnership with a potential acquirer. And in many cases it means putting in place a long term, full time management team to generate revenue and profits.
I’m the inventor – why should I give you a majority of the business?
We deeply appreciate the sense of ownership our inventor partners have in their inventions. It is, in most cases, a product of their life’s work. So, it’s not always easy to understand that the invention itself has almost no economic value even though it has tremendous intellectual value. To transform the invention into economic value requires many millions of dollars, lots of iterations with customers that often result in a totally different invention and whole lot of other efforts.
It’s my invention – why don’t I run the business myself?
Simply put, you can do everything we can do. It will take you a lot longer and you’ll make a lot of mistakes. But, if you want to run a business, then you should run the business. If you’re excited about learning how to engage with customers, raise funding, keep the books, meet state employment regulations, negotiate intellectual property agreements, comply with federal procurement laws, and a lot more, then you should absolutely go for it. We all did the same at one time or another.
You could, of course, not bother to learn those skills and instead hire people to do them after you raise a big bucket of cash first. We strongly recommend against this approach. But give it a try if you want. Doing is the best way to learn!