"It's a good deal for investors, but it is risky. After all, they have nothing to show for their investment until the transactions close. Our reputation is the principal reason investors come aboard," says Mr. Wasmer, whose company grossed $90.2 million in 2001 and was ranked number 54 on last year's Hispanic Business 500.
He says Somerset also uses the residual value of the company's leasing assets to reduce debt. Inven-tory costs are limited through the re-leasing or selling of equipment.
Case Study:MasTec Inc.
Elliot Abbott vividly recalls a conversation he had in the early 1990s with Jorge Mas Canosa, the man who gave MasTec Inc. its name. At the time, Mr. Mas Canosa was CEO of the construction firm Church & Tower, and he funded the company's tremendous growth with personally guaranteed bank loans. Mr. Abbott, an attorney with the firm Kluger, Peretz, Kaplan & Berlin, told his client to either cap his company's growth or find another type of financing. "The idea of being a public company, of reporting and scrutiny, didn't exactly make him jump up and down," Mr. Abbott admits. But he gave his attorney permission to explore the options.