We are now seeing Boards and Management Teams throwing in the towel. For some, perhaps the towel is the only thing they feel they have left. For others it seems to be a business tactic. For shareholders it is frightening and downright ugly!
Rather than invoke ingenuity or simply reach out for help a growing numbers of executives and senior managers are simply walking away from the companies they were elected to oversee. We have not seen an epidemic of this nature of behaviour in this business in the past 25+ years. On second thought – ever.
This is the generation gap that is growing. We have spoken about it in numerous articles. The past generations of junior miners truly related to prospecting, discovering, and developing grassroots projects. They were full of pride and self-esteem. They toiled in the bush, unbearable weather and tolerated failure; only to get up and try again. A few were dealt with fame and fortune, some made a decent living and limited success and the vast majority faced a life of challenging booms and busts. Today we are seeing a generation that gives things a shot, and if it doesn’t meet with success in the near term they simply move on without a second thought.
The junior mining sector has really felt this in the past decade and is really going feel this change in the coming years. This is partially why there have been very few significant discoveries and few if any area plays of note. What we have seen is the reintroduction of old discoveries and past producers in hopes of a shortcut to fortunes. It simply isn’t panning out and the sector better realize it sooner rather than later. The sector needs to return to three tiers of Prospectors/Discovers, Developers and Producers.
Over the past 10-15 years the space between the Prospectors and the Producers has become an almost unrecognizable smear. The prospectors are trying to participate through to production and the producers are trying to dominate the planet. The glue between the two, the developers, don’t quite know what they are supposed to do anymore.
Many of the Junior Miners listed on the various stock exchanges today are the developers and should be out in the market enthusing investors and financiers with their stories about their projects they are about to develop and ready for production. They aren’t! Instead, they are out running around the world trying to sell investors on how they are going to take their projects into production. They aren’t going to do that either, and the investors are well aware of it! Most need some serious help in defining what they are and forming a ‘strategic plan’ (Long-Term Plan). They don’t do this either. Most are just inanimate objects with a wish to somehow move forward, without air in their tires or fuel in their tanks.
The Junior Miners that heed this warning, who take a few steps back and regroup, have a chance of being around for the next run. Those that fail to understand and accept that you need to very quickly position your company firmly into one of the three sectors noted will be left in the dust when the market turns. For those of you who take your company and its shareholder’s interests seriously and need some arm-length help in analyzing all of this, establishing strategic and tactical plans and positioning your company for success we are here. We are available to work alongside your Board and Management Teams on a consulting basis. The more truly successful junior mining participants we can produce the brighter the future for all stakeholders in these companies and our industry as a whole. Contact Pat O’Brien at po@juniormining.com if you have any questions about our help.