Monday, November 29, 2010

Making Money Easy

Every time I listen to NJ Chris Christie I want to stand up and salute. Today is no different.

Please watch this 4 minute video where Chris Christie blasts LeRoy Seitz, Superintendent of Schools for the Parsippany School District about Seitz's threat to leave the state if his salary is reduced to $175,000. has more details in Governor sets sights on Seitz contract

Last week the Parsippany-Troy Hills Board of Education voted 6-2 to renew Superintendent LeRoy Seitz's contract, which included a 2 percent per year salary increase.

What made the contract noteworthy, aside from the dozens of people that spoke out against it and the tongue lashing the Board and the Superintendent received from Gov. Chris Christie was that the contract Seitz is currently working under doesn't expire until July 1, 2011.

The Board began contract negotiations during the summer, at about the same time the Christie administration released information about a plan to cap chief administrator's salaries and tying the numbers to the enrollment in the district.

By finalizing the contract now the Board effectively agreed to give Seitz a salary well above the governor's proposed cap for almost five years.

At the Board meeting Mark Tabakin, the Board attorney, told the gathering of about 90 people that the cap is still in the proposal form, that the contract was approved by the County Executive Superintendent Kathleen Serafino and that it is a legal action. "People are upset," he acknowledged, "but it's up to the will of the Board."

The controversial contract drew township residents and protesters from as far away as Clifton and Hackettstown, who were outraged over the Board's end run around the proposed cap.

At times the dissenters were so vocal Board President Anthony Mancuso, who remained calm and in control throughout the proceedings, had to call for a 10-minute recess to let the outbursts subside. The police were also called during one of the breaks though they never had the need to take action.

When the public was allowed to speak the floodgates opened. Taking a sarcastic tact the first speaker Roman Hoshovsky said, "How can anyone be expected to live on $200,000?" Then he produced an empty canister and proposed using it as a collection jar in businesses around town to raise money for Seitz.

Barbara Hackling pointed out the Board had laid off teachers and refused to negotiate with the paraprofessionals, "but found money for him."

Karen Blunt, a 36-year Parsippany resident and a paraprofessional in the district said, "He is looking out for his future. I haven't had a raise in 4 years who is looking out for my future?"

The day before the meeting Seitz is quoted in the Daily Record as saying, "Because of the proposed salary caps, I have to look at my future and the financial welfare of my family. I certainly would have options if I didn't feel the compensation in this district, or New Jersey, is appropriate."

The governor reacted to Seitz's veiled threats to leave New Jersey and go to a nearby state where there is no state salary. "I will say in response to Mr. Seitz, 'Let me help you pack.' We have real problems in our state that we have to fix and we don't have the time, nor the money, nor the patience any longer for people who put themselves before our citizens," Christie railed.
I Applaud LeRoy Seitz

A tip of the hat goes to LeRoy Seitz for being such an arrogant SOB that that the meeting to discuss the new contract overflowed with citizens fed up with school board greed.

It is not easy standing up to thugs who want nothing more but to raise your taxes. But the voters did. That's how riled up they were.

I recommend voters in the Parsippany School District send a message to the ignoramuses who agreed to give LeRoy Seitz a new contract. Vote them off the school board.

Fortunately it takes approval from another level to agree to that raise, so the raise is not a done deal yet.

New Jersey taxpayers are fed up, and rightfully so. If LeRoy Seitz thinks he can get $212,000 elsewhere, more power to him. The same holds true for every public "servant". If you can get more in the private sector, shut up and do it.

Mike "Mish" Shedlock
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Due diligence should always be a two-way street. A while back, I published an article on “Understanding the Dreaded Investor Due Diligence,” describing what investors do to validate your startup before they invest. Here is the inverse, sometimes called reverse due diligence, describing what you should do to validate your investor before signing up for an equity partnership.

I’ve had startup founders tell me that it’s only about the color of the money, but I disagree. Particularly if you are desperate, keep in mind the person who finds a good-looking partner to take home from the bar at closing time, but then wakes up in the morning wondering “What did I just do?” Taking on an investor is like getting married – the relationship has to work at all levels.

Due diligence on an investor is where you validate the track record, operating style, and motivation of your new potential partner. Maybe more importantly, you need to confirm that the investor “chemistry” matches yours. Here are some techniques for making the assessment:

  1. Talk to other investors. The investment community in any geographic area is not that large, and most investors have relationships or knowledge of most of the others. Of course, you need to listen for biases, but local angel group leaders can quickly tell you who the bad angels and good angels are, and what kind of terms they typically demand.

  2. Network with other entrepreneurs. Contact peers you have met through networking, both ones who have used this investor, and ones who haven’t. Ask the investor for “references,” meaning contacts at companies where previous investments were made. Don’t just call, but personally visit these contacts.

  3. Check track record on the Internet and social network. Do a simple Google search like you would on any company or individual before signing a contract. Look for positive or negative news articles, any controversial relationships, and involvement in community organizations. Check the profile of principals on LinkedIn and Facebook.

  4. Spend time with investors in a non-work environment. As with any relationship, don’t just close the deal in a heated rush. Invite the investment principal to a sports event, or join them in helping at a non-profit cause. Here is where you will really learn if there is a chemistry match that will likely lead to a good mentoring and business relationship.

  5. Validate business and financial status. Visit the firm’s website and read it carefully. Look for a background and experience in your industry, as well as quality and style. Conduct a routine credit and criminal check, using commercial services like HireRight. Be wary of individuals or funds sourced from offshore.

If you think all this sounds a bit sinister and unnecessary, go back and read again some of the articles about Bernie Madoff and recent investment scams. Remember, if it sounds too good to be true, it probably isn’t true. Entrepreneurs are optimists by nature, so I definitely recommend the involvement of your favorite attorney (usually the pessimist).

I recognize that it has been tough to raise capital these last couple of years, but don’t be tempted to take money from any source. This can be a big mistake, with common complaints running the gamut from unreasonable terms, constant pressure, to company takeovers. Be vigilant and ask questions.

A successful entrepreneur-investor agreement better be the beginning of a long-term relationship. If you don’t feel excited and energized by your first discussions with an investor, give it some time and do your homework. If the feeling doesn’t grow, it may be time to move on. It’s better to be alone than to wish you were alone.

Martin Zwilling is CEO & Founder of Startup Professionals, Inc.; he also serves as Board Member and Executive in Residence at Callaman Ventures and is an advisory board member for multiple startups.This post was originally published on his blog, and it is republished here with permission.

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