The real deal
Spending money and being happy
With the Smith investment, we had passed our cashflow break-even assets
under management to become a profitable business. We charged our man-
agement fee every month so the impact was immediate and we would now
receive a further $30,000 per month in fees alone. Since nothing had really
changed in our little firm and we had incurred no extra costs, this money
went straight to the bottom line. At last we were able to have an internal
meeting to decide how to spend our new-found wealth. ‘Salaries would be
a welcome change!’ suggested Brian. It was hard to disagree.
In the months that followed, we saw for the first time the positive side
of having significant momentum. We received an average of $10 million a
month in new assets under management both from our new large investor,
but also from investors who were now comfortable that there was little risk
in investing with Holte. The floodgates had not quite opened, but being
less desperate for money clearly made us a more attractive prospect. What a
new and nice change it was to sit in meetings with potential investors who
were looking for reasons to invest, rather than for reasons to stay away.
Without keeping track we felt that a meeting in our office had gone from
being 2 per cent likely to generate a new investor to more like 10–15 per
cent. And that made me more excited about taking meetings. Rather than
the dull faces of people trying to fill their schedules that pervaded earlier
meetings, the potential investors were now engaged and interested, sug-
gesting that they were actually seriously considering an investment.