Letters

Readers react to articles from the February issue of Inc., including Jill Andresky Fraser's "How to Finance Anything" and Jerry Useem's "All Dressed Up and No IPO."

Cash was king in February. Our omnibus editorial package--"How to Finance Anything"--generated the greatest reader response. Among the most talked-about topics: stock options, Wired magazine's initial public offering, and credit-card debt.

Green Mail

The majority of letters concerning " How to Finance Anything" sought finance editor Jill Andresky Fraser's advice on finding capital. But there was also lavish praise for the report, exemplified by this letter:

I am a professor of entrepreneurial finance at Northwestern University's Kellogg Graduate School of Management. Let me say that the February issue was the best you've ever published! To those who wrote and edited the articles, my sincerest congratulations on an outstanding job. The entire issue has been added to the suggested reading list for my present, as well as future, students.

Steven Rogers
Professor
Kellogg Graduate School of Management
Northwestern University
Chicago

Another reader, one with less academic concerns, was equally excited:

I read your article about business financing last night, and boy, did it hit home! I own a small retail store specializing in "outdoor" products, and I'm currently going through a cash-flow crunch that is starting to affect how I do business. I'm exploring sources for financing to solve my short-term problem, but I also want to make sure that the problem does not recur. Thank you for sharing your insight on this issue.

Tom O'Brien
President
Syd & Dusty's Outfitters
Lake George, N.Y.

Taking Stock

Edward O. Welles's cautionary take on giving employees stock options, " Motherhood, Apple Pie, and Stock Options," drew both praise and objections from readers:

I truly appreciate your magazine's efforts in digging up the real story behind such a widely accepted compensation plan. As the owner of a growing--and profitable--multimillion-dollar Internet company, I recently told my staff of 15 that stock options would likely be part of their future compensation. I knew I needed to do some more research on the matter, but I had no idea that stock options could potentially reverse employee motivation and loyalty as well as cause financial problems later on. I will definitely seek expert advice to ensure that my employees and my company share a common goal. I just hope someone can show me a better alternative. I want my hardworking staff to experience the thrill and benefits of ownership.

Mike Gilfillan
CEO
The ComputerJobs Store
Atlanta

This stock-option proponent disagreed strongly with Welles's thesis:

Welles's piece seems to suggest that employees are simply too unwashed to understand ownership--that their impact on a company is limited and replaceable, anyway. Welles implies that shareholders, who make financial investments in a company, are the only group that has any claim on the assets of the company, even if those assets are made up mostly of knowledge that employees have and can walk out the door with. For years Inc. has presented a very different picture of enlightened management. This article takes a big step backward.

Corey Rosen
Executive Director
The National Center For Employee Ownership
Oakland, Calif.

Public Humiliation

" All Dressed Up and No IPO," Jerry Useem's postmortem of Wired Ventures' failed stock offering, elicited a bevy of letters and E-mail from Silicon Valley types. One reader felt his worst suspicions about IPOs had been confirmed:

Reading this kind of article helps me learn many things from the pain of others. I don't think I will ever take a company public. I'm now convinced that the IPO decision is an "I'll bet the whole company" move. I don't know if I could ever bet the whole company, knowing how much pain, sacrifice, and energy went into building it.

Fred W. Hensel
President
Tech Team
Butler, PA.

A reader who had peripheral knowledge of the Wired debacle shares this anecdote:

I moved to the Bay Area about a year and a half ago, after leaving a company in San Diego. A good friend of mine also left the company the same day I did. He moved his family up here, too, to work in investor relations at Wired Ventures, during the time the founders were trying to take the company public. On his fifth day of work, he received that infamous E-mail message from Wired founder Jane Metcalfe announcing that the IPO had been canceled. My friend found himself in the position of handling all the media fires that suddenly surrounded the company. He tolerated that role for about 10 months and then left. As for your article about the failed IPO, I loved the depth and detail you were able to present. Kudos for waiting until now to write such a fair and balanced story.