The first of the two posts I'll mention is this one, "President Obama on the American Graduation Initiative", which consists simply of three paragraphs excerpted from a recent speech by the President, without any context or commentary by Persky. This was the comment I left on Persky's site:
What is the "American Graduation Initiative"? You haven't explained what it is here, it's not mentioned in the three paragraphs you excerpted, and you didn't provide a link to the full text of Obama's speech. You also haven't provided your opinion of the American Graduation Initiative (whatever it is) here. What was the point of this post?
I hate to be critical, but through your moxie and hard work, you've gotten a lot of national attention, and I don't think posts like this one are anyway to retain that attention. This one seems like you just wanted to post something for the sake of posting something.
The second post is this one, "Valuation Services and Consulting", and here's the text of it:
Steps for producing a valuation for a bank loan to a private company:
- Gather and review financial and legal documentation.
- Note key loan parameters such as: interest rate, maturity date, type of loan (bullet or amortizing), first or second lien, financial covenants, up-front and other fees, pre-payment penalty.
- Note key financial performance parameters: EBITDA, income, margins, cash flow, balance sheet (historic, current and projected).
- Analyze key financial ratios: leverage, interest coverage, loan to value.
- Perform DCF analysis.
- Compare company to similar publicly traded companies.
- Compare loan to publicly traded similar debt instruments.
- If the company is distressed, determine the value of its assets.
- If the company is in bankruptcy, determine the probability and timing of recoveries.
For competitively priced hedge fund portfolio valuations, business development corporation and private equity valuation services and consulting, please contact:
tel: 917 650 8700
Here's my thought on that post: Wouldn't any potential customer of Persky's valuation services already know about these steps? If so, how does enumerating this list in a blog post demonstrate one's talent for valuation? A better tack might be to offer as an example a case study where you can demonstrate your mastery of some tricky aspect of valuation. Persky could use a historical case where he has access to all the necessary data, or he could speculate a little and attempt a valuation (or comment on the reported valuation) of a well-known, privately held company. A way to get some attention as a valuation expert while demonstrating that you are familiar with current technology might be to attempt a valuation for a business such as Twitter.
Another thought: is it best to lead with price by offering "competitively priced" valuations? First, it's probably implicit that your valuations will be "competitively priced", given your current situation and the state of the labor market, and second, is price the most important factor to a hedge fund or other firm seeking a valuation? If it is, they can probably find an even cheaper valuation by outsourcing the job to India, but my guess is that they have more pressing concerns than price, such as, for example, accuracy, and protection from liability. This sounds like a difficult market to compete in as a sole proprietor. I wish I had some positive suggestion to offer here, but I always try to picture myself on the other side of the deal: if you were running a hedge fund and you were concerned about litigation from your investors, wouldn't you feel more comfortable having your valuations done by an established accounting firm?
Perhaps Persky would be better off taking his talents in a different direction. Presumably, if he is talented in valuing private businesses, he'd have some talent for investing in them as well. There are always business owners looking to sell their privately-owned businesses, and affluent individuals and companies looking to buy them. Persky might, for example, offer service where he'd help affluent individuals diversify their assets by buying privately-held firms. He might also scout out businesses currently for sale, do his own valuations on them, and then offer to help sell those businesses. Last year I approached a business broker about a situation and he was happy to offer me remuneration contingent on finding a buyer for his client. I imagine most business brokers would be amenable to this.
1Namely (for starters), in its lack of focus, its name, its use of a generic blogger template. I plan to address some of this in the near future.