To create a US$100 million Multinational Corporation will take US$100 million. So, your question should be: where is money coming from to make my VCP proposal work?

The Beowulf Investments' PIPES

As a first step, my firm, Beowulf Investments (BI), will invest US$1,300,000 to create your client's US$5,000,000 company. As I've outlined in my Primary Source of Business Capital article, BI recover its risk capital within sixty days. (Once done, we are willing to wait necessary years to achieve our profits, along with your company insiders.) To do so, BI must sell some of its shares to public. The resulting increased float creates imperative to bury shares and reduce effective float, as discussed in my article, Burying Stock.

In theory, Beowulf Investments could recycle same US$1,300,000, or any amount of money, into any client company without incurring a long-term risk. However, this isn't in anyone's best interests.

Our goal is to supply money to start M&A process. We strongly believe that a public company M&A strategy will create money needed for company to grow. (In past four years, Cisco Systems, for instance, even with some major errors, turned their company into a current $147B giant using this process. I can hardly argue with such a gargantual success. So what we're doing here is not reinventing wheel.)

In first year or two, it is possible for Client Company to have access to a key acquisition, without having cash to buy it. In that case, Beowulf Investments will supply that cash.

Our Clients are Printing Their Own Money

Stock is money. It's a paper currency like all paper currencies. Most public companies print far too many shares and suffer inevitable consequences of seeing their currency collapse.

Used as money, our pubic company client's shares will supply 75% of cash they need to create a hundred million-dollar company.

Our public company client can buy private cash-producing assets, using its shares. These shares will hold a constant exchange rate value with U.S. Dollar. The owners of private, cash-producing company, acquired by our public company as it grows to being a twenty million dollar company, will have sold for far more to our public company client than they could have sold to another local private buyer.

The reason for that is that 2-for-1 stock split will give original owners nearly double their firm's actual value due to split. For example, our public company client will use US$1 million of Beowulf Investments' money and US$3 million of their shares valued at US$20/share. Thus acquired company will own 150,000 shares of our public company client. With 2-for-1 split, they will own 300,000 shares valued at US$20/share and worth US$6,000,000. Our public company client has effectively paid these private company sellers, US$3,000,000 more than their private companies were worth.

The reason that you must bury your public company's shares is to reduce your company's float. The lower your public company's float, lower your investor relations cost. [See my article The Proper Use of Shares.] The buried shares are deducted from your float and balance is called effective float. Your goal is to reduce effective float to as near zero as possible. If your effective float is zero, you need not find buyers for your float because there are no shareholders selling their stock in your company. This, of course, is ideal situation. I suggest that if you want your public company to succeed in all aspects, you may want to structure your company's float like this.

Speculators, Not Investors

American stock buyers, on whole, are speculators, not investors [http://www.iht.com/articles/529443.htm]. They buy stock with hope of quickly selling it at a profit. Even U.S. Government realizes that speculation doesn't lead to economic growth. Taxes for stock buyers willing to hold their shares for at least one year are less than for those who speculate in Market and quickly sell their stock. The American Government's tax incentive hasn't altered speculative nature of U.S. Market, because long term investors are consistent money losers. I've often wondered why these long-term investors continue to buy and hold shares in such a manner?

Avoiding Having Your Shares In Market

My over 20 years involvement in North American stock markets have proven to me that Market professionals make more money selling stocks short (betting that price of shares will go down and company will go bankrupt) than they do by buying shares. The textbooks only list one of over two dozen of ways that professionals use to sell short stocks. (I have written a short selling article that lists twenty-four ways to short shares.) The only effective defense to short selling is to ensure that Depository Trust Company (DTC) in New York doesn't have any of your company's shares in their possession.

When most people buy shares, they leave them "in street name" rather than taking possession of share certificates. "In street name" simply means they are all turned over to DTC for safekeeping. Short sellers "borrow" or otherwise rely on existence of street stock to sell nonexistent shares into company's market. Public short sellers expect to pay "borrowed" shares back at much lower cost when stock collapses. Professional short sellers never expect to buyback nonexistent shares and legally avoid U.S. taxes on their profits in doing so. If shares are not there to be borrowed, your company can't be sold short.

If your company can keep your shares away from DTC, by having all your shareholders demand physical delivery of their share certificates, your company is said to have a Cash Market in its stock. Few companies bother or understand dangers they run from short sellers. Brokerage firms and DTC work very hard to make it extremely difficult to create a Cash Market in any stock.

Burying Insider Shares