MBA/JD people

[JS80]

Originally posted by: TheoPetro

Originally posted by: JS80

Originally posted by: TheoPetro
I definitely dont have that kind of experience in the VC industry but one of the partners does. He has been at it for over 10 years (C-Level @ a PE firm) and did CPA work before that. He brings the experience and some of the $, I bring a small funding source and the vision (its easier for a semi-ignorant person to dream) while the third partner brings a medium sized funding source (he will be mostly silent).

The whole idea is still a little ways off (2-3 years) so much of this can change in that time.

What is C-level at a PE firm? Usually MDs are the ones that break off and start their own shop. He was an auditor before that? My guess is he was the "CFO"? Creating financial statements, etc? So operations, not the investment team?

I used to work at a hedge fund alongside the PE group. They were like you, looking for noob business owners with high cash flow looking to take advantage of the owner by offering to buy equity at like 3-5x multiples. Let's just say they had one deal the year I was there.

Ya he is operations side, not investment side. There is definitely going to be a learning curve but he (personally) has bought and sold businesses before (not sure how many). Lets hope we can land more than a deal a year. His CPA stuff was almost all for tiny businesses (under 5m) and I have worked with a fair amount of small businesses in the construction industry. I think out of that pool we could at least get 5-10% of them. One of the problems I have with VC is that their sole option of creating value is complete management replacement. Most owners I speak to know what to do they just dont have the correct team around them. I really want to focus on building that team rather than firing the owner.

You pretty much described Private Equity. A lot of VCs are hands off and will not replace management. Just to give you a picture of the fee structure, let's say you're able to get the traditional 2/20 (2% on assets and 20% on profits), with a very optimistic $10m fund. The 2% will generate $200k and let's say you invest most of the $10m and generate a generous 15% return of $1.5m which will generate $300k, for a TOTAL fee of $500k. That is not much to pay employees, office space, regulatory shit, etc. Not to mention that if you don't monetize the gains you will need new investors pretty much to pay the bills.

 

[TheoPetro]

Originally posted by: JS80

Originally posted by: TheoPetro

Originally posted by: JS80

Originally posted by: TheoPetro
I definitely dont have that kind of experience in the VC industry but one of the partners does. He has been at it for over 10 years (C-Level @ a PE firm) and did CPA work before that. He brings the experience and some of the $, I bring a small funding source and the vision (its easier for a semi-ignorant person to dream) while the third partner brings a medium sized funding source (he will be mostly silent).

The whole idea is still a little ways off (2-3 years) so much of this can change in that time.

What is C-level at a PE firm? Usually MDs are the ones that break off and start their own shop. He was an auditor before that? My guess is he was the "CFO"? Creating financial statements, etc? So operations, not the investment team?

I used to work at a hedge fund alongside the PE group. They were like you, looking for noob business owners with high cash flow looking to take advantage of the owner by offering to buy equity at like 3-5x multiples. Let's just say they had one deal the year I was there.

Ya he is operations side, not investment side. There is definitely going to be a learning curve but he (personally) has bought and sold businesses before (not sure how many). Lets hope we can land more than a deal a year. His CPA stuff was almost all for tiny businesses (under 5m) and I have worked with a fair amount of small businesses in the construction industry. I think out of that pool we could at least get 5-10% of them. One of the problems I have with VC is that their sole option of creating value is complete management replacement. Most owners I speak to know what to do they just dont have the correct team around them. I really want to focus on building that team rather than firing the owner.

You pretty much described Private Equity. A lot of VCs are hands off and will not replace management. Just to give you a picture of the fee structure, let's say you're able to get the traditional 2/20 (2% on assets and 20% on profits), with a very optimistic $10m fund. The 2% will generate $200k and let's say you invest most of the $10m and generate a generous 15% return of $1.5m which will generate $300k, for a TOTAL fee of $500k. That is not much to pay employees, office space, regulatory shit, etc. Not to mention that if you don't monetize the gains you will need new investors pretty much to pay the bills.

We should be able to run the thing part time initially. I have unused office space available for free right now. It wouldnt be hard to structure the pay so that we only start taking $ out when it gets large (none of us NEED the cash). The regulatory shit will be expensive just because of the initial attorney expense and whatnot.

What youre forgetting is that these are smaller than microcap companies. The capital gains from these will be much more than 15%. 15% is a generous return on a well diversified portfolio. Your return on a portfolio of strictly value microcap stocks is going to be much higher. We can structure the first few to IPO in 5 years and use the capital gains from that (which should be MUCH more than 15%, remember were taking say a 1m company and turning it into at least a 10m company in 5 years) will be able to finance the rest. We can then structure them so that if its better for them to remain private companies we can just siphon off some dividends semiannually.

I may just be falling into the trap of overestimating gains and minimizing expenses but we went over the rough numbers and it should work out very nicely. It will just take 5 years to start making money and 10 years to make good money.

 

[JS80]

Originally posted by: TheoPetro
We should be able to run the thing part time initially. I have unused office space available for free right now. It wouldnt be hard to structure the pay so that we only start taking $ out when it gets large (none of us NEED the cash). The regulatory shit will be expensive just because of the initial attorney expense and whatnot.

What youre forgetting is that these are smaller than microcap companies. The capital gains from these will be much more than 15%. 15% is a generous return on a well diversified portfolio. Your return on a portfolio of strictly value microcap stocks is going to be much higher. We can structure the first few to IPO in 5 years and use the capital gains from that (which should be MUCH more than 15%, remember were taking say a 1m company and turning it into at least a 10m company in 5 years) will be able to finance the rest. We can then structure them so that if its better for them to remain private companies we can just siphon off some dividends semiannually.

I may just be falling into the trap of overestimating gains and minimizing expenses but we went over the rough numbers and it should work out very nicely. It will just take 5 years to start making money and 10 years to make good money.

For every one company you find that generates returns from $1m to $10m you will have nine companies that lose the entire $1m. $1m => $10m risk profile is venture capital-esque. Browse TechCrunch. You are competing against seasoned veterans will billions of dollars. Good luck.

 

[Darthvoy]

I'm actually giong through a 1,200 dollar LSAT course with powerscore. This course is really helping quite a bit. Personally, I have no doubt that I will score in the 99 percentile when I take the LSAT in september. If you don't want to take a course, you should buy powerscore's books. I've bought others like Kaplan and Princeton, but I found to many errors in them... some even had the wrong answers selected as the right one.

 

[Corporate Thug]

To answer the OP's original question, BLUE PRINT is the best prep IMHO. Unfortunately, they are only in CA and NY. Testmasters would be the next best.

 

[QueHuong]

Anyone who have taken the LSAT listen to the podcast "LSAT Logic for Everyday Life" published by Princeton Review? Haven't taken the LSAT but I like the podcast and would listen to it for fun if I wasn't planning to...but I'd like to know if it's actually helpful. It's available on iTunes.

 

[Playmaker]

Take a diagnostic LSAT before dropping $$$ on a prep course. You may find that the LR and RC sections are already intuitive for you, and you just need to work on logic games. Unless you totally lack self-discipline (in which case law school might not be the best idea), prep courses are a waste of money and you're better off with the Powerscore bibles, prior LSATs (there are 40-50 out there), and a regular self-study plan over 3-6 months before the exam.

I would also echo the numerous responses that have noted how you're wasting your time with a JD if you don't want to practice law. Its value is very different than it was in the 1970s/80s with respect to business.

 

[Harvey]

Originally posted by: dirigible:

And I'd say unless you have a real need for legal education, you likely are wasting your time getting the JD. You can read/research on your own with just basic knowledge of how the legal system works and learn about specific areas of law. Don't forget the opportunity cost of the year+ extra you'll spend getting the JD.

I dropped out of law school after a year, and I can tell you it was a great education. In that first year, I took contracts, torts and criminal law, and learned how to use a law library.

I can read and write my own contracts, and I'm smart enough to have any serious contract I sign reviewed by an attorney. After being jacked around with boiler plate NDA's, my late partner and I wrote a beautiful, inventor protective NDA that has subsequently been used some of my friends and business relationships, includiing by and with some very large companies.

Regarding patents, after reading enough of them (and seeing how much bullshit some of them contain), I wrote my own application for my second patent and did my own patent drawings. I used a patent agent as my editor to whip it into final shape to conform to USPTO standards. I had all 51 claims accepted on my own writing.

A patent agent can do everything a patent attorney can do EXCEPT represent a client in court.

Along the way through that learning curve, I hired and fired three patent attorneys, all of whom were electrical engineers, and none of whom could understand my invention sufficiently to write about it, even after I explained it to them with competent drawings.

I'm not a degreed engineer, either, but I have two patents, published articles and successful products in the field, and my patents are cited by later patent applications.

An MBA and/or a JD and/or an engineering degree will get you in the door for many job openings, but in the end, it's what you know, not where you learn it.

Originally posted by: Safeway

A survey of top executives and CEOs showed the #1 undergraduate degree was engineering. They are not designing or building anything. Why isn't the top degree in business management?

Engineering = problem solving, critical thinking.
Law = problem solving, critical thinking.

Executives = problem solving, critical thinking.

I agree that the thinking skills are the same, applied to different sets of facts and conditions, but an education in any of those fields is only a set of tools. The real stars in any of then are those who can make creative and inspired use of those skills to transcend mundane, ordinary solutions.

On a side note -- If anyone needs a well reviewed, inventor-oriented NDA to protect your own ideas, LMK. My late co-inventor/business partner and I wrote our own written in "humanese" that you can easily understand, edit and use as a guide to apply to your own situation. I have it as both a WinWord and text file.

Originally posted by: JS80

Originally posted by: Safeway

A survey of top executives and CEOs showed the #1 undergraduate degree was engineering. They are not designing or building anything. Why isn't the top degree in business management?

Engineering = problem solving, critical thinking.
Law = problem solving, critical thinking.

Executives = problem solving, critical thinking.

:laugh: holy shit i never laughed so hard in my life

Could that be because you've never done any of those jobs, let alone any critical thinking? :roll:

 

[JS80]

Originally posted by: Harvey

Originally posted by: dirigible:

And I'd say unless you have a real need for legal education, you likely are wasting your time getting the JD. You can read/research on your own with just basic knowledge of how the legal system works and learn about specific areas of law. Don't forget the opportunity cost of the year+ extra you'll spend getting the JD.

I dropped out of law school after a year, and I can tell you it was a great education. In that first year, I took contracts, torts and criminal law, and learned how to use a law library.

I can read and write my own contracts, and I'm smart enough to have any serious contract I sign reviewed by an attorney. After being jacked around with boiler plate NDA's, my late partner and I wrote a beautiful, inventor protective NDA that has subsequently been used some of my friends and business relationships, includiing by and with some very large companies.

Regarding patents, after reading enough of them (and seeing how much bullshit some of them contain), I wrote my own application for my second patent and did my own patent drawings. I used a patent agent as my editor to whip it into final shape to conform to USPTO standards. I had all 51 claims accepted on my own writing.

A patent agent can do everything a patent attorney can do EXCEPT represent a client in court.

Along the way through that learning curve, I hired and fired three patent attorneys, all of whom were electrical engineers, and none of whom could understand my invention sufficiently to write about it, even after I explained it to them with competent drawings.

I'm not a degreed engineer, either, but I have two patents, published articles and successful products in the field, and my patents are cited by later patent applications.

An MBA and/or a JD and/or an engineering degree will get you in the door for many job openings, but in the end, it's what you know, not where you learn it.

Originally posted by: Safeway

A survey of top executives and CEOs showed the #1 undergraduate degree was engineering. They are not designing or building anything. Why isn't the top degree in business management?

Engineering = problem solving, critical thinking.
Law = problem solving, critical thinking.

Executives = problem solving, critical thinking.

I agree that the thinking skills are the same, applied to different sets of facts and conditions, but an education in any of those fields is only a set of tools. The real stars in any of then are those who can make creative and inspired use of those skills to transcend mundane, ordinary solutions.

On a side note -- If anyone needs a really good, inventor oriented NDA to protect your own ideas, LMK. I have it as both a WinWord and text file written in "humanese" that you can easily understand, edit and use as a guide to apply to your own situation.

Originally posted by: JS80

Originally posted by: Safeway

A survey of top executives and CEOs showed the #1 undergraduate degree was engineering. They are not designing or building anything. Why isn't the top degree in business management?

Engineering = problem solving, critical thinking.
Law = problem solving, critical thinking.

Executives = problem solving, critical thinking.

:laugh: holy shit i never laughed so hard in my life

Could that be because you've never done any of those jobs, let alone any critical thinking? :roll:

says the law school dropout :laugh:

 

[Harvey]

Originally posted by: JS80

Originally posted by: Harvey

Originally posted by: JS80

Originally posted by: Safeway

A survey of top executives and CEOs showed the #1 undergraduate degree was engineering. They are not designing or building anything. Why isn't the top degree in business management?

Engineering = problem solving, critical thinking.
Law = problem solving, critical thinking.

Executives = problem solving, critical thinking.

:laugh: holy shit i never laughed so hard in my life

Could that be because you've never done any of those jobs, let alone any critical thinking? :roll:

says the law school dropout :laugh:

That's me, and I learned a lot of useful things in that year of law school. :thumbsup:

That's me, the same guy with an undergrad degree in business, successful product designs, two patents, including one I wrote, myself, and a well received NDA that really protects inventors.

US Patent 4,155,047

US Patent 5,157,350

As I said, it's what you know, not where you learned it. Your turn. What do you have to show?

 

[artemicion]

I prepared for the LSAT by just taking a bunch of practice tests. For practice tests, I would recommend only using the official, previously administered LSATs released by LSAC. I've read through a couple of the ones written by 3rd party test prep companies and they seemed "off" to me. I can't really articulate why, but the style of the questions felt different, particularly with the puzzles/games section.

That said, I don't think this approach works for everybody. I had a comp sci degree in undergrad. I think that helped because the LSAT favors logical/rational style thinkers over intuition/feel type thinkers (if you're familiar with the Myers-Briggs distinction).

I would say that if you can take a practice tests, look at the questions you got wrong, and confidently say you know why you got those questions wrong, you might not need test prep company help.

If you have trouble understanding why you got certain questions wrong, I would get one of the Princeton or Kaplan books that have the answers explained. If you still can't figure it out, I'd sign up for a test prep company. The Princeton/Kaplan books will also be good for teaching you timing strategies. If you find you can't finish the test on time I'd consider getting additional help.

Finally, I would first research what schools you want to go to, find out what score they require, and plan your prep around that. The advice, paying as much money as you've got to get the highest score possible is flawed if you're tied down by family, etc. and have limited, viable options for schools. I tutored a dude for the LSAT whose ONLY option was a small, local law school because he had a wife and a kid and moving out of town wasn't an option. Doesn't make sense for him to pay thousands of dollars for Kaplan/Princeton tutoring if the school he was trying to get into only required a 155.

 

[Silex]

I read through the whole thing believe it or not. Good stuff in here. Since I am planning an MBA/JD as well I found it useful to know that having both would be good to have to practice business law. The only difference for me is that I am completing my MBA right now at one CSU institution and will be applying for my JD at another. I plan to focus on IP law and am currently studying for the patent bar. Having both degrees seems to apply to my career objectives pretty well.