John Dimmer

John Dimmer is a successful businessman and entrepreneur who knows that the financial side of a business is at least as important as the inspirational side. As he put it, “The two most important parts of a business are The Big Idea and Funding.” Dimmer wanted to run his own business, and had several ideas to do so.  However he was smart enough to know that his good ideas were not enough. He felt that he needed some experience, and some money, before venturing out on his own. Having an analytical mind, he went into banking for a few years. In addition to gaining experience, he built contacts and strengthened his skills. It was then that he sought funding for his own projects.

There are three main sources of funding: Equity, Debt, and Investors. Savings and family members (maybe close friends) make up the first. For most of us, that is going to be a small portion of the total. Debt is the second choice. This is certainly possible, especially for a smaller idea. Loans from the Small Business Administration are typically relatively low interest. These work for those who can secure them. However, the third choice is often better for larger projects. Use other people's money through investment. Investors, often referred to as angels, invest in a project in exchange for something, often shares or future returns.

Investors invest in people. It's not enough to show a simple business plan; you have to sell yourself. How are you going to make them money? What are you going to use their money for? What is the end game? One of Dimmer's warnings was that if you seek funding in exchange for equity to make sure you're always above 51% ownership of shares of the business. Majority interest is always to be maintained, no matter how attractive the offer. The first round of funding is just that – the first round. Each "raise" needs to have the next one in mind. Rather than selling out more and more shares to the limit, concentrate on making each share worth more through growth funded by others like angels.

After a few years the company Dimmer was working for, that he had a percentage of specifically for the exit event, was acquired by Luminus for enough money that he could retire. Three weeks and dozens of golf games later, he was bored with retirement. That's when he went into business for his father's company, FIRS Management, and started investing in others. He had come full circle, now taking on the angel role.

One main point I took away is that you have know yourself – what is the reason you want to be an entrepreneur? For Dimmer, it was money. For me, it's both that and to create a product I want to use that does not exist. The former is to eventually fund more of the latter. My plan is deferred gratification. Working hard and smart, living simply, and reinvesting profits mean that a point will come in the future where my money is doing the majority of the work. At that time, concepts such as working for pleasure or having the freedom to do what I want might come into play.

A second main point was one that seems to be repeated in many of the speakers in the class – relationships matter. Dimmer and Andrew Fry have known each other since high school. They've known each other before either had substantial success. That knowledge meant that they knew each other's characters beforehand, and knew they could trust each other.