Continued from page 1
In
OTCBB Market, P&D promotions are more complex that outlined above. However,
costs and resulting net profit are as I've outlined above. So let's assume that you can make about $600,000 during three small P&Ds over about three years with your S&M deal. To make more money, you'll want to develop "a stable" of S&M companies. Over a seven year period, let's assume you can do three P&Ds on five companies. You'll make $3,000,000.
For years , I've argued that
money is in doing one real OTCBB company. You start out with a company making money, if not a profit. You either create
company or buy it. If you are cash-strapped, you buy a turnaround. You take your cash-producing company public via spinoff. You forget that you have four million insider shares. You move your share price to $20/share. You use your strong share price to do a Private Placement financing. You use your strong share price to buy cash-producing assets. Over a 5-7 year period, you create a hundred-million-dollar company.
From
beginning, you've made your acquisitions to meet
needs of a major power in your industry. You've focused on overseas asset development because it costs less and is often more attractive to industry giant corporate buyers.
With a strong balance sheet and a $20 share price, you open discussions to do a friendly merger with that Industry Giant. As a public company, you let public investors know of your pending friendly merger at Market Capitalization (share price times issued shares). Your share price climbs to $40/share in anticipation of your pending merger.
You sell your 4 million shares at $40/share in
friendly merger. You make $160 million. You get your "Golden Parachute" as an officer or director of
company. It's worth another $5 million to you. You net $165 million in about 7 years.
What makes more sense? You can make $3 million in 7 years doing Pumps & Dumps. You risk regulatory problems doing it. You'll lose your friends and business associates because you'll have defrauded them with your S&M deals. Some of your P&Ds will fail and cost you money. Or, you can create one real company. You'll make $165 million. You won't have to hide from
SEC. Your friends and business associates will thank you for putting them into your stock.
It's your choice. If you chose
real company strategy, I want to help you. If you prefer
P&D strategy, please don't contact me.
To contact
author: Visit
Beowulf Investments website: [http://home.earthlink.net/~beowulfinvestments/] Or, visit
Global Village Investment Club Website: [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]
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He has been the Managing Director of Beowulf Investments [http://home.earthlink.net/~beowulfinvestments/] since 1981 and is the Executive Director of the Global Village Investment Club [http://home.earthlink.net/~beowulfinvestments/globalvillageinvestmentclubwelcome/]