Your article provided several thought-provoking comments on the involvement of venture capital firms in high-technology companies. The article also reflected a commonly held perception that once a company has fallen on hard times, it is destined to fall by the wayside. However, this perception as it refers to Fortune Systems Corp. is inaccurate, as is the inclusion of Fortune in a cluster of "living-dead companies."
While some perceive Fortune as one of the "growing tribe" of failing companies, the facts clearly refute this position. Fortune Systems recently reported quarterly revenues of $20.3 million, with a profit of $39,000. Some do believe that once a company has developed a downward momentum it is impossible to recover.
After four consecutive quarters of reported losses Fortune Systems has managed a turnaround. Our balance sheet remains strong, with more than $44 million in cash on hand.
Furthermore, Fortune's recent 69% increase in sales is indicative of customer acceptance of the company as a leader in office automation systems.
Contrary to the article, Fortune Systems is not "struggling to stay alive." A strong new management team, record international sales, new distribution channels, and, most importantly, improved product performance and customer service are leading to continued growth and profitability.
When we publised "Why Smart Companies Are Saying No to Venture Capital" (August), we anticipated that the article would generate much response fom both entrepreneurs and venture capitalists. The response, as reflected in the letters that follow, has shed some additional light on a very important subject. We trust that this is not the end of the discussion about the role of venture capital in building companies, and we encourage other readers to inform us of their experiences.