Each year top technology companies and life science companies are nominated for categories corresponding to different stages of business maturity.  The event highlights three finalists in each category and then announces the winners.  Osage Venture Partners is pleased to have three finalists and one ultimate winner in our investment portfolio including:

• InstaMed – Technology Growth Company Winner
• Halfpenny Technologies – Life Science Growth Company Finalist
• SevOne – Deal of the Year Finalist

Congratulations to all three companies for being recognized as leaders in their categories, with a special call out to Bill Marvin and the entire InstaMed team on a well-deserved win.  InstaMed has been in the Osage portfolio for over four years and we have had the pleasure to watch this business continue to fulfill its mission to be a major payments network in the healthcare space serving providers, payers, and patients.  

InstaMed made an early bet on Philadelphia’s tech scene and has been headquartered in the city since inception, as real pioneer at the time when most tech companies seemed to be headquartered on the Route 202 corridor.  Just one more area where InstaMed is both a visionary and a leader, and they are really just getting started.  

Nate Lentz, Robert Adelson, David Drahms,  Sean Dowling

One conversation that stayed with me was some advice that a seasoned CEO and operator gave to one of our newer CEOs who had recently graduated from bootstrapper to venture-backed entrepreneur.  The advice was to “look at your cash balance every day,” and continued: “Don’t get a report from someone else but go online, sign in, and look at the balance.  Knowing what’s going on with your cash is knowing what’s going on with your business.”

This is great advice.  Every entrepreneur should follow it.

Itzhak Sharav, a highly regarded Columbia Business School accounting professor and an epic figure in the Chemical Bank Credit Training curriculum, used to begin his course on financial accounting by writing three words on the chalkboard: “Cash is King.”  Financial accounting is all about translating financial statements governed by GAAP to financial analysis that tells you what is really going on.  And what is going on is cash.  A good CEO does not leave an understanding of cash flow to someone else.  Excellent CEOs know cash flow.

Jim Collins, before he was one of the most broadly read business authors ever, was a highly acclaimed lecturer at Stanford Graduate School of Business.  He taught a course called Small Business Management which was really his test-bed for many of his perspectives that came to life in his later publications.  One exercise, called Wild Neckties, required teams to build cash flows for a necktie business with a decently long supply chain, slow paying retailers, and aggressive suppliers.   The take-away from the exercise was that in such a scenario high growth can exhaust your supply of cash, as the income statement might tell you good news while the cash flow statement told you the truth.

In addition to the advice above, some of my favorite cash management recommendations include: 

Require two signatures on every check over $500 and make one of them be yours.  This includes expense reimbursement checks.  Make sure you are not just signing the check but that the check is attached to the approved invoice or statement.  As any entrepreneur knows, signing checks is painful and a necessary evil.  Looking at the details of the invoice and who signed off on it gives you a strong sense of how money is being spent and by whom.

• A corollary is to kick back a certain percentage of expense reports with questions:  “Why was this flight so expensive – did we book it in advance?”   “Ritz Carlton?  Who stays at the Ritz-Carlton?”  When people know the CEO is looking, they think twice about booking a non-stop flight or their favorite hotel.

Review the payroll every pay cycle and approve the disbursement.  Understand how much is going out in every two week or monthly payroll cycle.  If it seems to be going up versus previous periods, make sure you understand why.

• A corollary to this is to make sure that all contractors and part time workers are included in the payroll approval.  Contractors and part-time people can be invisible spend and can often be off the radar and easy for people on your team to add headcount without visibility.

Be put on the bank’s list of wire notifications and if possible, approve all wires yourself.  Cash never leaves a company faster than through a wire.

Have a payables aging and accounts receivable aging run for you at least once a month if not weekly with a comparison to the previous periods.  If you are visibly worried about cash, your people who manage payables may try to stretch them.  If they do, you want to know about it because ultimately, these bills need to be paid.  With A/R, slow collections can suck the life out of your business.  

• A corollary here is to have a standard payment term for all contracts and make sure that deviations from those terms are approved by you – and try to rarely approve.  Aggressive commission based sales people will use payment terms as a lever to keep other terms in place.  Soon your A/R are 90 days and your customers are current.  Little start-ups don’t need to finance GE, but often they do.

Maybe most importantly, know how many months of cash you have left.  This means knowing your gross burn per month and your contractual receipts.  You should always be able to answer two critical questions: 1) If you sold nothing else, how many months could you go?, and 2) What is your gross monthly burn?  You should set a level ahead of time – maybe six months – and establish a rule that if, based on your monthly burn, you have less than six months of operating runway, you formalize your fund-raising strategy, or, if few alternatives are available, you take the actions necessary to reduce your burn and extend your runway.

When I became CEO of Verticalnet in November 2002, the previous CEO had resigned and had filed a 10-Q stating the company would be bankrupt in a few months.  In my first meeting with employees after becoming CEO, I was asked publicly if we had enough cash to get through the end of the year because people needed to know if they could spend money on gifts for Christmas.  I told them honestly that by my calculation we had at least four months of cash.  In January, two months later, I was able to communicate that the timeline had been pushed to June and by March our visibility had extended until November.  Mid-summer, we raised capital and extended the timeline much further, but for the five years I was CEO, I always knew “the number.”  By keeping a close eye on cash, I followed the sage advice of our portfolio CEO, and remained intimately aware of our liquidity metrics.

As CEO, you may think you are in charge, but always remember – Cash Is King!

Among the various speakers and panels at the conference, a number of themes emerged, including:

• A mobile, social, or Big Data "strategy" or "initiative" on its own is bound to fail: the new technologies should be considered tools to execute on an overall business strategy - a means to the end, rather than an end in and of themselves
• Technology innovations broaden the scope of what is possible by lowering transaction and collaboration costs: this new reality should prompt frequent revision of how an enterprise delivers value to its customers
• Purchasing power for technology is shifting from IT to the business: as a result vendors should stop selling based on technology and focus on the business value, as the business user wants a solution that works, and isn't as much concerned in how
• Timing matters: launching a new technology too early before the market has appropriately matured can prove equally costly as waiting too long to find yourself displaced by faster moving competitors

These last two themes, when considered together, presented a bit of a paradox, particularly in light of the experience of the Osage Venture Partners portfolio.  The underlying message of aligning the sales process around business value – and in effect disaggregating the technology from how that value is delivered – makes intuitive sense.  Several recent trends that show a shift in the control of IT budgets (including the consumerization of the enterprise, where employees or small divisions choose to deploy a SaaS solution such as Dropbox without consulting the IT department, and an increasing concentration of budget responsibility for technology investments with the CFO or CMO) suggest this disaggregation may in fact be coming.  However, our portfolio CEOs will quickly tell you that IT remains deeply involved in the decision making process and continues to care very much about how a technology works.  We have seen this countless times across our portfolio, such as when Pneuron challenges the existing paradigm of the need for centralized data warehouses or CMC faces financial services customers with objections to utilizing the cloud due to concerns about security or data control. 

My observation is that customers (and venture capitalists, for that matter) will forever be skeptical of a black box solution; for entrepreneurs to convince someone they can in fact deliver business value in a faster, cheaper, or better way than the alternative necessitates a multi-faceted sale that allows the other party to not only look at the results, but also peek behind the curtain of how those results were delivered.  As the last theme highlights, pushing too far beyond what people are comfortable with will result in the inevitable "too good to be true" skepticism that can prolong sales cycles and require significant capital and time to educate the market.  Thankfully, the crowd at Phorum has accepted that challenge by pushing the envelope of innovation to ensure technology continues to evolve to deliver ever greater business value, and we look forward to participating in that ongoing disruption.

At Osage Venture Partners, we have portfolio companies with very different work / office / lifestyle cultures.  Some examples include:

• A bi-coastal “work-in-the-office” company with an “always on” video conference connection in the kitchens of both locations so people can mingle and take water-cooler breaks with each other
• A company with no permanent offices, a contract for Regus space when needed, creative use of investor real-estate, and deep use of Google apps for collaboration
• A company where 95% of the employees are in one location, everyone is expected to come to work every day, and they all thrive on being in one place
• A company with developers distributed around the country and the world where the core development team “hangs out” on Google hang-outs all day long as though they are working together in one place
• A company that covers 70% of its real estate costs by having space available for other pre-funded and post-funded start-ups to co-locate and share infrastructure, conference space, and social “water-cooler” interaction

Bottom line – there is no secret formula for what an office environment should be like.  The secret formula is to hire great people, have them fully understand the mission, engage their passion, and know that wherever they are, they are fully committed to the success of the business because they can directly connect the success of the business with their own success.  If you do that, the options for work environments are endless.  For most of our portfolio companies, they are on the first cycle of business building.  This means that most employees are aligned around the vision, every hire is critical, and the mission is understood and embraced.  Not all of these visions will become reality, but for this phase of the business life-cycle, alignment is relatively easy as long as the hiring process is effective.

A turnaround is a different story, and Marissa Mayer is very publicly in the middle of what is a massive turnaround.  I may be the only person I know whose web browser opens up to my “My Yahoo!” page.   My kids and younger co-workers laugh at me, as I used to laugh at my father for using AOL until three years ago.  This perception demonstrates the turnaround challenge facing Yahoo!.  In the markets where Yahoo! has offices, including Sunnyvale, New York, Bangalore, and Beijing, the battle for talent is fierce, as the best people want to work at the “hot” company.  Given that Yahoo has not been “hot” for a decade, who is left working there?  Well, there is clearly some percentage of loyal, hardworking people, who have had their heads down and have done well and have remained loyal.  Thank God for them – they may be the only reason Yahoo! is still operating.  Then there are the people who opt to stay because it is an easy paycheck.  No need to be in the office, little accountability, constant management rotations, few metrics or expectations, and possibly a 40 hour a week job that can be done in much less time.  The hard part of a turnaround is trying to figure out who is in the first category and who is in the second.  For Marissa Mayer, getting people in the office is about change management and a culture shift.  She did not hire these people, or their managers, or even their managers’ managers.  She needs to see who deserves, in Jim Collins’ words, “a seat on the bus.”  Ms. Mayer is raising the bar for what being a Yahoo will be, and she is seeing who will meet the challenge.

I bet the move to eliminate telecommuting was a tough one, but I also think it will prove to be a smart one.  I would also bet that this will be followed by a lot of departures – both by choice and by termination –and by a lot of new hires who map to the persona of the new Yahoo!.  There will be more written on the new Yahoo! culture in the future, and my guess is that it will generally be very positive.  I would also guess that telecommuting will return to Yahoo! in the future once the right people are in the right seats on the bus.

Funny though, this company that everyone thinks of as a has-been is still worth $26 billion in market cap.  By the way – that’s neck and neck with Salesforce.com, and Yahoo! recently has been rising faster.

THE MEMO:

Yahoos,

Over the past few months, we have introduced a number of great benefits and tools to make us more productive, efficient and fun. With the introduction of initiatives like FYI, Goals and PB&J, we want everyone to participate in our culture and contribute to the positive momentum. From Sunnyvale to Santa Monica, Bangalore to Beijing — I think we can all feel the energy and buzz in our offices.

To become the absolute best place to work, communication and collaboration will be important, so we need to be working side-by-side. That is why it is critical that we are all present in our offices. Some of the best decisions and insights come from hallway and cafeteria discussions, meeting new people, and impromptu team meetings. Speed and quality are often sacrificed when we work from home. We need to be one Yahoo!, and that starts with physically being together.

Beginning in June, we’re asking all employees with work-from-home arrangements to work in Yahoo! offices. If this impacts you, your management has already been in touch with next steps. And, for the rest of us who occasionally have to stay home for the cable guy, please use your best judgment in the spirit of collaboration. Being a Yahoo isn’t just about your day-to-day job, it is about the interactions and experiences that are only possible in our offices.

Thanks to all of you, we’ve already made remarkable progress as a company — and the best is yet to come.

Jackie

Venture investors should have to fundraise if for no other reason than to recognize how hard and how frustrating the process is for every entrepreneur that comes to us looking for capital.  Fundraising for entrepreneurs can be an exhausting, humbling experience, and for many it may not have a positive outcome.  Thus it is healthy for us as investors to taste some of the medicine that we as an industry often dole out.  Fund raising is about an educated, focused search for the needle in the haystack.  At OVP, we reached out to hundreds and talked to dozens of funds, had follow-up meetings with many of them, and at the end of the process ended up with a handful of well-matched limited partners with whom we are really well aligned and very pleased to have as part of the Osage family.  We were reminded that persistence – lots of persistence – and confidence in your mission are key ingredients to a successful outcome.  So in looking back, I hope my fund raising experience will make me a better person for entrepreneurs to engage with.

Here are some of the lessons learned that I hope will translate into my own interactions with companies seeking capital:

• Sometimes, to be accommodating or polite, we take meetings with companies that are low (and perhaps, if we are being realistic, no) chancers.  What seems polite in the short run is unfair in the long run.  We should not take meetings where the sector or stage or structure is already an apparent deal killer.
• We try always to read the materials ahead of time and typically ask our entrepreneurs not to go through the “book.”  We want a dialogue, and so should the entrepreneur.  If we disagree with what is being said, we should let the entrepreneur know in real time.  You can’t convince me if I don’t let you know I am unconvinced.
• We should always start on time, and have decision makers at the table.  It takes a lot of preparation, practice, and courage to pitch a venture firm, and the least we can do is be sure you are speaking to the right people.
• We should never leave you thinking we had a good meeting when it was not, and should provide open and honest feedback throughout the process.  That will help you prepare for the next meeting, either with us or another fund.
• Distance matters.  The farther we ask you to travel, the higher the bar should be for our initial meeting.  An in-person meeting is much more difficult for a Boston company and is much more of a commitment than an in-person meeting with a team from downtown Philly.   We should consider this.
• And, finally, we should be empathic but not commiserate.  It is not really helpful for us to tell you that this is a hard fund-raising environment – it turns out that this might be less about making you feel better and more about self-comfort.  We all know that entrepreneurs are intrepid mountain climbers, and they don’t need VCs to tell them how steep the climb looks.

So – entrepreneurs, if we meet with you, we believe that there will be a good fit to justify a meeting.   We will be prepared.  We will try to give you feedback.  We will enter the meeting with a strong belief in the talent and opportunity of this region.  We will continue to believe in the value and need of enterprise software.  We will continue to believe that without great entrepreneurs there is no venture capital and that it is you, the entrepreneurs, who drive the venture ecosystem, not us.

At Osage Venture Partners, we are pleased to have several years of capital to deploy, a great market in which to deploy it, and tremendous entrepreneurs starting and building companies even as I write this.

Great companies, great teams, and great entrepreneurs – we look forward to chatting.

Press Release

Posting Its 6^th Consecutive Year of Record Revenues, SevOne Receives $150 Million Investment from Bain Capital

Wilmington, DE – January 15, 2013 – SevOne, creator of market leading IT infrastructure management solutions, today announced that it closed 2012 with its 6^th consecutive year of record financial results. The company’s results were driven by existing customers adding more elements to manage their burgeoning networks as well as adding a record number of new customers.  Based on this success, leading business software investor Bain Capital invested $150 million in the company. 

“SevOne is the only solution that enables its customers to see all services in real-time within global distributed networks of any scale.  The world’s largest and most sophisticated customers choose SevOne for its fast time to value and unique peer to peer architecture that scales to address big data network growth,” said Ben Nye, Managing Director at Bain Capital Ventures.

"We were attracted by the incredibly high satisfaction levels of SevOne’s customers, the unique differentiation of their technology, and the talented management team.  We look forward to partnering with the SevOne team to maintain their growth and accelerate their go to market operations,” added Ben Holzman, Partner, Bain Capital Ventures.

SevOne provides a highly scalable, easy to deploy IT monitoring and reporting solution that provides high levels of visibility for enterprises, service providers or any entity dealing with challenges around network latency, new service rollout, business interruptions and increasing volume of data on their networks. SevOne's IT Performance Appliances scale cost-effectively without limitation or performance degradation so customers, for the first time, can monitor and manage any IT infrastructure, no matter how massive or complex.

"SevOne is thrilled to partner with Bain Capital as we take the company to the next level,” said Mike Phelan, CEO, SevOne. “The investment caps a highly successful 2012 for SevOne. Our bookings doubled year over year, profitability increased significantly and our customer base doubled.”

Pacific Crest Securities served as financial advisor to SevOne in this transaction.

About SevOne

SevOne, Inc. delivers the industry’s fastest, most scalable, and comprehensive real-time IT infrastructure monitoring, troubleshooting and performance reporting solution. SevOne invented a proprietary, next-generation distributed technology, called the SevOne Cluster™, that combines the cutting edge principles behind peer-to-peer sharing and big data analytics to scale smoothly so that millions of IT elements, across all monitoring technologies, can be managed and provide a single view to the user. Hundreds of customers, including the top cable companies, wireless network and managed service providers, and top financial services institutions rely on SevOne to reduce operating expenses and improve quality of service.   SevOne was recently named the 75^th fastest growing company in North America on Deloitte’s 2012 Technology Fast 500 rankings.

About Bain Capital

Bain Capital, LLC ( www.baincapital.com) is a global private investment firm that manages several pools of capital including private equity, venture capital, public equity, high-yield assets and mezzanine capital with approximately $67 billion in assets under management.   Since its inception in 1984, Bain Capital has made private equity investments and add-on acquisitions in over 450 companies in a variety of industries around the world.  Bain Capital Ventures (www.baincapitalventures.com) manages over $2 billion of assets and has over 70 active portfolio companies.  Bain has a long history of investing in branded technology and business service companies, such as Solarwinds (NYSE:SWI), AppAssure Software, Archer Technologies, Network Intelligence, dynaTrace Software, LinkedIn (NYSE:LNKD), SurveyMonkey, Taleo, and DoubleClick.  The firm has offices in Boston, Palo Alto, New York, Chicago, London, Munich, Tokyo, Shanghai, Hong Kong and Mumbai.  

SevOne Contact:

Gina Karr

SevOne Inc.

gkarr@sevone.com

+1 (302) 319 5400

Media Relations Contact:

Tony Keller

The Walker Group

tkeller@walkerlimited.com

847.421.1477

Early in my career the face to face transaction was common.  You learned a lot about people while locked in law firm conference rooms for hours trying to complete a transaction or working though deal covenants.  When a transaction closed, it was a celebration.  You knew right when it occurred – everyone got up, shook hands, patted each other on the back, and often headed out to have a drink.  This allowed personal relationships to develop during the transaction, as counterparties revealed themselves as good people at heart who were arguing and negotiating hard because they were serious about their jobs.

Today, we do so many transactions electronically.  Clearly we meet companies face to face, visit their offices, and hold in-person diligence sessions.  This is not a hands-off business and never will be.  But we transact remotely and often electronically.  As a result, the process often becomes far less effective or efficient, as demonstrated by the effort required to simply get all parties on the phone, which often defaults to having the lawyers talk to each other, inevitably driving up the time required to solve simple issues (and thus legal fees).  When you do deals remotely, there is almost always a tendency to under-communicate across negotiating parties, resulting in potentially damaging assumptions or overthinking of motivations rather than simply engaging the other party in dialog.  This comes from an unhealthy inverse ratio of the amount of time spent with your own team versus the amount of time speaking with the people with whom you are doing a deal.  In an operating model like venture, you spend years working closely with the founders / management with whom you negotiate a deal, and should thus view the structuring of the deal itself as an opportunity to establish the foundation of that relationship.  Structuring, negotiating, and ultimately signing and completing a transaction remotely is a lost opportunity to build a strong relationship and to learn more about the people with whom you will be partnering.

So – am I going to change my behavior?  Well, I am going to try.  This is my New Year’s resolution.  I am going to focus on face-to-face transactions.  When it is not hugely impractical, I am going to negotiate term sheets and other key deal terms in person.  When it is time to sign and to fund, I want to be in the room with the company leadership either at our law firm or at theirs.  Sure – take it all into escrow awaiting the filing with the state – I’ll take the management for a meal or a drink.  When we sell the company, I want to be sitting in the room with the management team and the attorneys, celebrating how much value they have created and how they have just changed their lives.  Will this be inconvenient at times?  You bet it will be.  But remember - business is personal and milestones are to be savored.  For me it’s back to the future and face-to-face.

An Osage spy in his second year at Stanford GSB recently passed along the above direct quote from one very highly regarded GSB lecturer: 

Funny – this Bay Area world view is more common than you think between highways 280 and 101.  I like the “ever” and I like the future hubris.  Really?  REALLY?  Wasn’t he kidding around?  Apparently not.  I am sure the Romans felt the same way two thousand years ago while forgetting about the contributions of the Greeks and not anticipating their own ultimate decline.  

When I got to the Bay Area in 1989, it didn’t have the same attitude.  It was actually a refreshingly grounded place versus the New York City I had left behind.  Over the past 20 years, Silicon Valley has enjoyed an enviable run, producing a lot of great companies and creating an eco-system that others are trying hard to copy with varying degrees of success.  But the attitude behind the quote suggests a “fin de siècle” for this particular region of the country.  Other regions will succeed and will ultimately dilute the Silicon Valley preeminence and great companies will emerge from wherever there are great people and meaningful capital to deploy. 

As a mid-Atlantic investor, I love this west-coast attitude.  It creates huge opportunities for non-Silicon Valley entrepreneurs building capital efficient businesses based on real domain knowledge they built within the industries they are now targeting.  Silicon Valley has great investors, great entrepreneurs, and great businesses being built there but when you believe that good ideas don’t exist further than the distance you can drive with one charge in your electric car, you get into trouble.  Remember what MY guest lecturer at the GSB, Andy Grove, told us – only the paranoid survive.  This current quote is not the voice of paranoia, but that of self-satisfaction. 

As for responding to the quote – is it really worth an exhaustive list?  Texas Instruments (first semiconductor – tied with Fairchild),  ATT, IBM, Lotus, Wang, DEC, AOL, Microsoft to name a few.   By the way – where was Facebook founded?   Most world changing businesses are created on the foundations of what others built before and innovation knows no borders.   Feel free to send me other names and we will post in a follow-up.

By the way, I chose not to name the lecturer but, maybe not surprisingly, he is a former venture investor.

• For how many of the deals you are projecting to close this quarter have you already been selected?
• Has procurement played a role in the selection in any of these opportunities?  Will they need to?
• How many have gone to legal?

Optimism on deals is endemic with entrepreneurial organizations but understanding how pipeline translates to wins and wins translate to cash is critical.

Most of our portfolio companies sell to enterprises and experience long sales cycles.  This is the nature of the beast.  But enterprises, once sold, are highly valuable assets and have the potential for massive customer lifetime value.  The problem with managing a pipeline is that each deal has two critical dimensions: “Will we win?”  and “When will we win?”  In general, I would say the typical portfolio company is good to very good at understanding the odds of winning and is bad to very bad at predicting when the wins will occur.

I have a couple of simple rules that I use when looking at a pipeline for evaluating the question of “when will we win?”  They aren’t always right, but they are close enough, often enough.  These rules include:

• If the likelihood of winning isn’t over 50% at the start of a quarter, it isn’t closing in that quarter
• If the proposal has not been submitted, it isn’t closing in the current quarter
• If you have not been selected by the end of the first month of the quarter, closing within that quarter is highly at risk
• Add 30 days for procurement and 30 days for legal – at least (and procurement is now involved increasingly often)
• If procurement has not yet been involved but needs to be, you have not yet truly been selected
• The larger the deal, the slower it goes

Some of these seem redundant and may be.   Here is my logic for each:

If it isn’t over 50% at the start of a quarter, it isn’t closing in that quarter:  This is a case of just doing the math.  Assuming a six month sales cycle (at least), if you have more than 50% to go, that’s  over 90 days to close, which means – not this quarter.  Just to note, many enterprise sales cycles average longer than six months.  A deal that starts fast because the business buyer is in a hurry will not necessarily continue to move at that pace – who says the rest of the organization will move as fast?  Some deals start fast and slowdown.  Others start slowly and speed up.  I play the averages.  And if your enterprise sales cycle is well less than six months – please send me your business plan.

If the proposal has not been submitted, it isn’t closing in the current quarter:   Much of this is similar to the comments above, except some companies put pre-proposal stages at 50% or higher odds (a mistake in my view).  This is just another way to screen the deals that are too early.  If you are pre-proposal you are only just talking – and talk is cheap.

I take the next three rules together:

If you have not been selected by the end of the first month of the quarter – closing within that quarter is highly at risk

Add 30 days for procurement and 30 days for legal – at least (and procurement is now involved increasingly often)

If procurement has not yet been involved but needs to be, you have not yet truly been selected

Procurement is the emerging challenge.  Most enterprises require procurement’s involvement with purchases above a certain threshold.  The challenge with procurement is that they often know things the business buyer does not know.  They ask questions like – “can’t we do this under our global Oracle agreement?”   or “the UK division just signed a global agreement with a start-up that is listed as a direct competitor – you can use that for free.”  Even if procurement is wrong, the business buyer needs to go through a process of proving why his or her purchase decision is justified.  Procurement isn’t just a time lag – we have seen deals get killed in procurement after a nine month selection process and not come back.

Bottom line – legal and procurement take time as do final signatures and final approval.  Sometimes it takes a month to get a signature on an approved deal even after it has been blessed by legal.  

It hurts to pull things from the current quarter pipeline and push them to the next quarter, but the discipline is critical.  If you are not selected with sixty days to go – pull it.  If you are not in legal with 30 days to go – pull it.  Don’t take the pressure off the sales team – they may work miracles – but don’t promise your board that the improbable will happen, and don’t make your cash projections based on these deals closing inside the quarter.  You are playing against the odds and making promises you can’t keep.  This is no way to run a business.