Ted Farnsworth | Crain's Raleigh Durham

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Ted Farnsworth

Background:  

Based in New York and Los Angeles, Helios and Matheson Analytics is an information technology services provider offering a range of technology platforms that are focused on big data, artificial intelligence, business intelligence, social listening and consumer-centric technology. Helios and Matheson is parent company to MoviePass, a movie theater subscription service that allows film enthusiasts to attend up to one movie per day for a subscription price. MoviePass currently has more than 2 million subscribers, and is accepted in 91 percent of theaters.

The Mistake:

Overplaying my hand.

Back in the late ‘90s, I had a company in the internet space called Farmbid.com Which was all about agriculture. We had gotten all these eyeballs on it, and I was out raising money from venture funds to take the company public down the road.

Eventually, I had these big investment bankers at the table wanting to give me money and take the company public. I got a little greedy, and started playing one banker against the other, trying to get the best deal possible, all involving hundreds of millions of dollars. Deep down, I knew I was pushing my luck, but I wanted to score the best deal, and stretched things out for probably a good 90 - 120 days.  

Then, the dot-com bubble happened. We were about 60 days away from going public. I remember sitting in my office, watching CNBC, when Marc Faber came on and said that Safeguard Scientifics said it would no longer be funding anymore business-to-business dot-com companies. It was like all the spigots turned off, after that.

Everything stopped, and we got no funding.

Everybody waits for the perfect deal, but there’s no such thing. 

The Lesson:

Don’t wait too long to move on things that you know, deep down, you need to seize upon. This is especially true when it comes to money from Wall Street; you never know when some big event will shut down all your funding sources.

I move a lot quicker now. With MoviePass, for example, I’ve raised hundreds of millions of dollars in the last six months. I went out and did a $480 million shelf registration with Wall Street -- I never have to worry about money for MoviePass again. I didn’t wait for anyone, and I went with my gut.

None of this is to say that you should take the first deal that comes along. Just don’t sit there, hemming and hawing for too long when you know you have a good situation on your hands. The rug could just as quickly get pulled out from underneath you.

Everybody waits for the perfect deal, but there’s no such thing. Get what you can, so you can ride out any storm that comes your way.

 

Helios and Matheson Analytics is on Twitter at @HMNYHQ1MoviePass is on Twitter at @MoviePass.

​Photo courtesy of Nick Garcia.

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