FINANCIAL MANAGEMENT CASE STUDIES

1) A rapidly-growing distribution company struggling to survive due to an

array of financial issues

The Challenge:
The Client suffered from cash flow issues caused by rapid growth, undercapitalization, and
lack of financial management expertise and control processes. The Client accumulated
excessive losses and struggled with liquidity issues that threatened the companys future
viability. They had grown too rapidly and lacked processes and working capital to fund their
success. The Client needed financial restructuring and a solid, experienced financial advisor
if the company was to succeed.
The Solution:
Rankin McKenzie was brought in to clean up the companys finances and help find bridge
capital. We helped the Client establish new banking relationships and secure a loan. Interim
short-term financing was also secured to fund seasonal business. Subsequently, a plan was
developed to help the Client set goals for predicted future growth and cash flow
requirements. The Client was impressed with our ability to problem-solve in a time of their
greatest need.
The Partnership:
Rankin McKenzie continues to provide ongoing financial advice and services in the form
of part-time Controller services to help the company during its next growth phase.
 2) A technology start-up company headed by an inexperienced CEO that
needed to raise significant equity capital

The Challenge:
The Client needed to raise considerable equity capital to fund the continuation of their
product development and their sales and marketing efforts. Previously, the Client had raised
limited capital from local Angel investors, but now needed to attract sophisticated
institutional investors. This was the first time the CEO had headed a venture-backed start-up
company and he needed prudent business counsel to avoid the typical pitfalls of a young
company.
Additionally, the Clients daily bookkeeping was being handled by an administrative assistant
with little accounting experience. Accounting records were inaccurate and incomplete. The
CEO was understandably concerned that his accounting records would not pass the rigorous
due diligence conducted by the new institutional investors. The Client needed an experienced
CFO who had successfully raised venture capital and who could serve as a trusted advisor to
the CEO. He also needed to make sure the day-to-day was being handled in a professional
manner that would give investors confidence.
The Solution:
At the recommendation of the Clients attorney, Rankin McKenzie was engaged to both assist
the CEO in raising equity capital and to be responsible for the companys accounting
functions. Rankin-McKenzie utilized a team-approach to meet the clients needs. The team
consisted of a part-time CFO who had extensive start-up and capital
fundraising experience and a part-time Controller who had expertise in QuickBooks. The
Rankin McKenzie team helped the CEO successfully raise over $7 million in equity capital
from a top-tier venture capital firm. Moreover, the teams careful management of the
companys books and records made the VC due diligence a painless process. The CFO served
as the CEOs close confidant to help guide the Client through numerous challenging growth
opportunities.
3) An e-commerce start-up company in need of accounting expertise

The Challenge:
Sales were beginning to grow rapidly and the company was in need of a clear, concise
mechanism for reconciling sales per the company website to the back gateway and bank.
The Solution:
Rankin McKenzie provided a part-time Controller to the Client in order to establish
procedures for tracking and reconciling sales on a monthly basis. Additionally, numerous
financial reports were developed that have provided management with valuable tools for
running the business successfully.
The Partnership:
Rankin McKenzie continues to provide ongoing, part-time Controller services to help the
company during its next growth phase.
4) A Biotech Start-Up Company That Needed To Raise Capital

The Challenge:
The Client needed to raise its first institutional round to complete initial animal studies. The
co-founders completed a draft of a presentable Business Plan, but early investor feedback
indicated that the financial projections were unrealistic and unacceptable. The financial
presentation needed to clearly demonstrate the use of capital and what additional capital
requirements would be required upon successful completion of the animal studies. The Client
did not have the experience to undertake this financial presentation and had limited resources
to engage an experienced full-time CFO.
The Solution:
Rankin McKenzie was brought in to meet with the co-founders and review the Business Plan.
We devoted time with the co-founders to understand their Business Plan and then develop a
five-year financial model to show the cash flows required to execute the Business Plan. After
several iterations, a final financial model and summary was incorporated into the revised
Business Plan for investors. After reviewing with previously contacted investors and several
new investors that Rankin McKenzie knew, two investors expressed interest in negotiating a
term sheet with the Client. In addition, the Rankin McKenzie partner assisted the Client by
making sure that the existing financial statements were reliable and understandable. The
Client was impressed with our ability to problem-solve in a time of their need.
The Partnership:
Rankin McKenzie continues to provide ongoing, cost-effective financial advice and services
in the form of a part-time CFO to help the company during its capital raise and subsequent
events.