Life changing decision .... time to grow up fast

[zachary]

Wow, the moment I have been waiting for has arrived but i am not sure if it is what I want.

I will try to keep this short. I am a exploration geologist for a small independent E&P company. Our "small" company current moves quite a bit of product. I have been in line to take over as exploration manager since I got here. One thing about oil and gas business is the huge generation gap in the technical jobs. My boss is 60 i am 30. We also have a young attorney who has been sculpted and developed to build the future on with myself.

My boss and I had a huge blow up 2 weeks ago, never had one before. Well to go forward from that we needed to talk about it. Conversation went basically like the owner and he are finished within 1-2 years and ready to step down and hand it over. Well this is what i have been waiting to hear, never thought it would happen to soon though......so awesome amazing its happening i am thinking....time to make rational grounded decisions and make some more money...

Then he says that they will pull there funding also and want us to start from the ground up funding wise. They have built there nest eggs and are out out. That we would need to go to private equity firms(we are in good terms with several already) and gather the 1-300mm to go forward. We would have to fund the entire company(45 employees) in daily operations and in participation on our deals.

WOH, say what! It will not be just making decisions and collecting a bigger check but risking everything to move forward.

Have another job offer also, great company, great incentive package, if you make them successful they will make you successful. Could eventually build up to a manager position there in 5-7 years make a lot of money and not have the associated risk.

SO...

Sit back be comfortable and make 1-3 over the next 10-15 years, or throw everything into it, take the big risk, put on big boy pants get funding and potentially make 1-3 within the next few years and 50-100 over the course of a career.

Funding does not mean success either. Believe me i know that, but 1 or 100.

[bcoop]

You will never get rich working for someone else. With no risk, there is no reward; but with great risk, comes great reward. I'm in a similar situation, but not as risky when it comes to the funding part. We're still responsible for 20+ employees, and that scares the shit out of me, more than something like going bankrupt personally.

I say do it, and swing for the fences. It may not work out, but with a solid plan and hard work, chances are it will pay off greatly. It's scary, it's not easy, and you're going to work your ass off. There are going to be times when you don't collect a paycheck for yourself. But the payoff will potentially be huge. Good luck in whatever you decide.

[YALE]

Go for it, but be honest about where you fall short in experience or talent, and recruit in help.

[95ragtop]

Swing for the fucking fences. Screw mediocrity.

[TexasT]

You are young. X3 on the go fer it. If it doesn't work, you can take another shot or if you decide just work for someone else.
If you want to reap you must sew.
You will always wonder if you don't at least take a shot, and that's no way to go through life.

[jakesford]

PE means they will have MGMT teams, is it the current owners making the deal to get paid as the walk out the door? Just watch out on the deal, the PE is there to make their return in 3-7 years typically...

[Trip McNeely]

What play is this in? Seems kind of odd that the owners are pulling out. How successful are your wells and is the ROI good?

[jleews6]

My 2 cents,
Do what is going to make you happy and have less stress. Life isnt all about money! When I was younger I went through all the motions of working like a dog and chasing the dollar. At 35 I thought I was on top of the world,new house,car collection,money invested and living the life. Two years later most of it was gone and I was broke.My 12 YO had cancer.

I hate to preach to younger people but trust me,Its not all about the dollar. Enjoy life and enjoy every day .Dont get yourself into a position where your working your life away to "get rich".
Do what you think is going to make you happy either way.Good luck.

[zachary]

PE means they will have MGMT teams, is it the current owners making the deal to get paid as the walk out the door? Just watch out on the deal, the PE is there to make their return in 3-7 years typically...

See here is the huge change. Thus far funding has been based on family money to start(lucky sperm we call them). They built an extremely successful company here and has been with 100% of their personal money at stake and used from start till now, never a loan. Not OPM.

There are several equity firms that deal specifically with E&P companies and do exactly what we are looking for. Have a really strong lead on one in particular who knows us already from a different deal. You are correct though, basically they want 8% flat ROI starting the second year and everything over 8% starts wedging its way more toward borrower over time and value added. (i am not an accountant i know the jist of it though)

[zachary]

What play is this in? Seems kind of odd that the owners are pulling out. How successful are your wells and is the ROI good?

The owners were in the business when it was good to be starting and be in the business. Had a solid game plan and were incredibly successful from the start. They have made hundreds over the past 25 years, and literally do not want to work anymore. They have said once proven they would turn some of their money back toward it, but have to build it on our own first.

Not one in particular area. We have drilled wells over the fast few years in Texas, Louisiana, Arkansas, Mississippi, Alabama, Pennsylvanian. If the numbers are right we will do the deal. This business is mainly about connections when it comes to getting involved in deals.

[Big A]

Sounds way too good to be true, one usually doesn't just "hand over" a multi-million dollar company, with a pat on the back and a git-er-done. How much are they selling for, and what will you personally be on the hook for, other than the continued success of the operation?

[Strychnine]

Sounds way too good to be true, one usually doesn't just "hand over" a multi-million dollar company, with a pat on the back and a git-er-done. How much are they selling for, and what will you personally be on the hook for, other than the continued success of the operation?

That's a bit dismissive, all things considered. It's not a lemonade stand he's talking about.

[mustang1200]

Sounds way too good to be true, one usually doesn't just "hand over" a multi-million dollar company, with a pat on the back and a git-er-done. How much are they selling for, and what will you personally be on the hook for, other than the continued success of the operation?

Maybe I'm wrong, but it sounded like the owners were going to basically empty the bank accounts and head on out. Leaving it up to the new owners to find the capital to continue the business.

[Sean88gt]

Dig deeper, something doesn't smell right.

Ultimately, you need to make sure you're happy, and running a business doesn't always make that possible.

[bcoop]

That's a bit dismissive, all things considered. It's not a lemonade stand he's talking about.

Agreed. Don't mind Aaron, he's just grumpy in his old age. We were handed a multimillion dollar company, and purchased with company profit, so nobody was out of pocket.