Great article ("Why Smart Companies Are Saying No to Venture Capital," August) on what an associate of mine dubbed "Vulture Capital."
Last March, a group I put together acquired Charmglow Products from Beatrice Foods in a leveraged buyout.
Our experience with venture capitalists was almost uniformly bad and disillusioning. In addition to the inexperienced "teenyboppers" we encountered, we found most venture capitalists eager to make a fast buck and cut an outrageous deal for themselves.
We can attest that their motivation seemed to be a huge short-term killing and a quick turnover. They wanted assurances that we would go public within two years, and they demanded "control" until that time, after which we got the impression that they didn't give a damn.
There's a happy ending. We painstakingly, and at times painfully, worked out a deal with two banks, a commercial financing company, and the seller, retaining solid control, not only in terms of equity but also in terms of our own destiny. We must run a very tight ship now, but we're making splendid progress.
I can't help but feel there are some of the Georges Doriot types out there. Somehow, we didn't encounter them.