(Repost from a Selling to Small Business blog to which I contribute.)
In a comment posted to [an earlier] entry, a reader noted that so many "stories are the same". That is so very true, even with rock stars- one more boy from south central LA; one more girl from Topeka, Kansas; one more aged star launching a comeback tour. There isn't story we haven't heard before. I often wonder how many iTunes tracks can actually be sold from singer-songwriters singing soft, halting guitar ballads about love and loneliness. Apparently, the answer is a staggering amount.
There are two very similar reasons. First, people want to hear it. They have an emotional connection to it. They like to hear something that reminds them of their youth, their passion, or their softer side. It reminds them of a part of themselves. Second, there will always be young males and females making the music, because there will always be youth, heartache, and beauty. People will sing about. And because everyone experiences those things, at least some of us will listen to it. See reason number one.
Small business has the same connection with most Americans. It is the American way. Everyone either has done it or would like to do it one day, if only... It is about taking risk, seeking independence, and taking care of your life. When they tell their story to the average American, they get quiet looks of admiration and respect. They are accustomed to this position in life, despite where it has actually gotten them on the totem pole. They have fought the good fight or are still fighting it.
A small business owner may have a similar story to the one you heard yesterday. The fact is that their story has subtle differences from the other. Those differences indicate the most important struggles that the business owner overcame. Despite the similarity of today's story to yesterday's story, that story is very real. It impacted the business owner in dynamic ways and changed who they are. Listen carefully: it IS who they are. A story like that has soul, funk, a bass line and a harmony. It might sound like last year's hit, but it is this year's hit, and more importantly, it is your potential customer's hit. Until you recognize and revere that story, the story of a rock-star, small-business owner, you will never be truly effective at selling to small business. You'll just get lucky sometimes.
If you want to build a relationship with a small business owner, take the time to hear their story. They always love to tell it. If they don't offer it, look around, it is probably on the walls of the small front office. Ask questions about pictures and awards you see. Be impressed. You should be. And then ask the big Hollywood question, "What gave you the idea for this business? How did you get started? Could you tell me how you got this GREAT idea?" Then sit down and let them tell you a story. When they are done, recognize their accomplishments (that they are, indeed, a rock star) and note how impressed you are that they got to this point.
If you have the time in your sales cycle, spend your entire first call listening to the story. Then say "Whoops! Look at the time! I have to go! Mind if I come back next week?" Without even pitching your pitch. I guarantee that when you return next week, they will look at you with more open eyes. They may even ask to hear your story!
Showing posts with label pensacola. Show all posts
Showing posts with label pensacola. Show all posts
Saturday, April 26, 2008
Friday, March 21, 2008
The Story of a Rock Star
(Repost from a Selling to Small Business blog to which I contribute.)
In a former life, I was in the music industry. I met the right star at the right time, and my entrepreneurial spirit did the rest. I was a part of an innovative group that developed new versions retro grass roots marketing and distribution. We dabbled in internet distribution before most people knew what the internet was. We had some star power behind us and we had a lot of fun!
To the public, the star is everything. In the industry, the star is simply the leading edge marketing tool. They are the story and the talent that leads consumers to products. Talent is important; the star has to have a great media presence, a great voice, inherent performance compulsions, and a moderate ability to think on their feet. Talent in one area is not hard to find. Talent in all areas is in abundance in every major city. But talent with a great story is rare. These are the stars. They sell products.
I was fortunate to work with one of the best star stories of the last decade. I first met this star before her 20th birthday. She lived in her van, and sang nights at a coffeehouses and bars. She was fortunate enough to get a spot in a San Diego club and was surrounded by some leading talent of the early nineties. She studied them and learned from them. There were more talented people around her, but she was the one to receive a big contract. She had one of the biggest debut albums of all time, with a number of subsequent albums.
There are many aspects to her story that can illustrate the points that I am getting to, but I'll just share one. I attribute a single reason this songwriter became a star. While all the very talented musicians around her spent their time between and after sets, hanging out back stage and drinking (among other things), the teenage girl did something different. She met her fans and really talked to them. She told her story at every show. She positioned herself at the exit and shook every patron's hand. She asked people if they liked her music. She asked people to come back and see her. One of those hands she shook was an executive from Atlantic Records. They came back to see her, and brought a contract.
This is my first contribution to a new Evan Carmichael blog. They are a few analogies I will draw from this story over the next months. The basics are these: Every small business owner is a rock star. Every small owner has a story and some degree of talent. Every small business owner wants you to know their story, not just their "music". Later we'll talk about how every small business owner only wants to sing and tell their story, just like a rock star. If you are going to sell to a rock star, you must understand these things. Finally, we'll talk about how to take this and shape into a sales strategy. We'll talk about how to convince a rock star that you are the best agent. And if you are still reading, we'll talk about how to get a rock star to sell product.
In a former life, I was in the music industry. I met the right star at the right time, and my entrepreneurial spirit did the rest. I was a part of an innovative group that developed new versions retro grass roots marketing and distribution. We dabbled in internet distribution before most people knew what the internet was. We had some star power behind us and we had a lot of fun!
To the public, the star is everything. In the industry, the star is simply the leading edge marketing tool. They are the story and the talent that leads consumers to products. Talent is important; the star has to have a great media presence, a great voice, inherent performance compulsions, and a moderate ability to think on their feet. Talent in one area is not hard to find. Talent in all areas is in abundance in every major city. But talent with a great story is rare. These are the stars. They sell products.
I was fortunate to work with one of the best star stories of the last decade. I first met this star before her 20th birthday. She lived in her van, and sang nights at a coffeehouses and bars. She was fortunate enough to get a spot in a San Diego club and was surrounded by some leading talent of the early nineties. She studied them and learned from them. There were more talented people around her, but she was the one to receive a big contract. She had one of the biggest debut albums of all time, with a number of subsequent albums.
There are many aspects to her story that can illustrate the points that I am getting to, but I'll just share one. I attribute a single reason this songwriter became a star. While all the very talented musicians around her spent their time between and after sets, hanging out back stage and drinking (among other things), the teenage girl did something different. She met her fans and really talked to them. She told her story at every show. She positioned herself at the exit and shook every patron's hand. She asked people if they liked her music. She asked people to come back and see her. One of those hands she shook was an executive from Atlantic Records. They came back to see her, and brought a contract.
This is my first contribution to a new Evan Carmichael blog. They are a few analogies I will draw from this story over the next months. The basics are these: Every small business owner is a rock star. Every small owner has a story and some degree of talent. Every small business owner wants you to know their story, not just their "music". Later we'll talk about how every small business owner only wants to sing and tell their story, just like a rock star. If you are going to sell to a rock star, you must understand these things. Finally, we'll talk about how to take this and shape into a sales strategy. We'll talk about how to convince a rock star that you are the best agent. And if you are still reading, we'll talk about how to get a rock star to sell product.
Monday, January 21, 2008
The Pitfalls of Deferred Compensation
I have recently been asked if I would "jump-in" to a start-up for 100% "deferred compensation" or equity. My answer was a definitive "NO".
My experience (on both sides of the coin) is what drives my agreements for "jumping in". I have found that unless there is at least minimal salary paid ($2k-$4K month) plus long-term, success-driven compensation (stock, equity, profit sharing, etc.), one or more of the following things WILL happen (usually all of these to some degree):
1. The company will not fully value the energy and investment the individual puts in (particularly before it creates revenue, when all the hardest work happens).
2. The individual will not full value the company and invest their time and energy fully (driving the company to revenue as rapidly as possible). This is inevitable and can kill a company (I don't care how motivated either is).
3. The company will probably lose a key individual at a critical moment because they got a great offer from a later stage company that brings their personal finance to a high cash flow positive (instead of cash flow negative). As a result, the company could lose the contract (or investor).
4. The company founder gets tired and folds. The partner/employee is left with nothing.
You could get lucky and find someone with great personal resources that will work for deferred salary/equity. In fact, it happens often. See number 2 again. It will happen. Let's say I have $7 million in the bank, but I like work, so I get involved with you. Then my daughter gets married. And I invest in an exotic resort in the Caribbean that I like to visit. I buy a new boat to play with. My energy involvement in the company slows; the company's growth slows. You may find a capable executive that has a reserve of cash or a severance agreement. See number 3. The chance of one of these two being the case is about 90%.
A minimum salary creates commitment and loyalty between the company its contributors that an equity stake just can't create. I have seen this happen both ways time and again.
I've been the start up guy with "my" company. On the part of the company, we want to take the smallest risk possible. We want our employees to take that risk with us, though they will not reap nearly the reward we will when success is reached. (Their ROI is not as high for the risk) In doing so, we create more risk around our success. With limited resources this seems necessary, but there are often ways to create a little cash flow to create this commitment. The key is to make the commitment in the right areas first.
A better path for business/corporate development is to allocate a small salary for that individual to pay their household bills (hence creating loyalty). Compliment this with significant bonuses associated with sales/investment milestones. Then ice the cake with a long-term vesting equity stake. This would interest me, and I could bring some a great wealth of experience and talent to bear on both business development and corporate development.
I am so clear on this that I won't get involved any other way. This may be tough for a founder to hear, but any talent looking for a great opportunity will probably say the same.
If the time to grow your business is right now, you may also look to your board of directors for help. At this stage, you should have picked board members that can provide limited resources part time, but can commit to a number of years. This is significant talent. These people will be contributors of one or more primary pieces of success. They will be strategic partners, possible clients, or experts. They will bring resources to the table. Standard practice for board members of a start-up is to compensate these board members with vesting equity. However, if you need someone to hit the phones, visit clients, or create documentation- you will need to hire.
Entrepreneurs are brave and courageous. They deserve respect and loyalty. But they must also grant this to those that help them realize their dreams. Properly executed this will pay dividends to the success of the business over the years.
My experience (on both sides of the coin) is what drives my agreements for "jumping in". I have found that unless there is at least minimal salary paid ($2k-$4K month) plus long-term, success-driven compensation (stock, equity, profit sharing, etc.), one or more of the following things WILL happen (usually all of these to some degree):
1. The company will not fully value the energy and investment the individual puts in (particularly before it creates revenue, when all the hardest work happens).
2. The individual will not full value the company and invest their time and energy fully (driving the company to revenue as rapidly as possible). This is inevitable and can kill a company (I don't care how motivated either is).
3. The company will probably lose a key individual at a critical moment because they got a great offer from a later stage company that brings their personal finance to a high cash flow positive (instead of cash flow negative). As a result, the company could lose the contract (or investor).
4. The company founder gets tired and folds. The partner/employee is left with nothing.
You could get lucky and find someone with great personal resources that will work for deferred salary/equity. In fact, it happens often. See number 2 again. It will happen. Let's say I have $7 million in the bank, but I like work, so I get involved with you. Then my daughter gets married. And I invest in an exotic resort in the Caribbean that I like to visit. I buy a new boat to play with. My energy involvement in the company slows; the company's growth slows. You may find a capable executive that has a reserve of cash or a severance agreement. See number 3. The chance of one of these two being the case is about 90%.
A minimum salary creates commitment and loyalty between the company its contributors that an equity stake just can't create. I have seen this happen both ways time and again.
I've been the start up guy with "my" company. On the part of the company, we want to take the smallest risk possible. We want our employees to take that risk with us, though they will not reap nearly the reward we will when success is reached. (Their ROI is not as high for the risk) In doing so, we create more risk around our success. With limited resources this seems necessary, but there are often ways to create a little cash flow to create this commitment. The key is to make the commitment in the right areas first.
A better path for business/corporate development is to allocate a small salary for that individual to pay their household bills (hence creating loyalty). Compliment this with significant bonuses associated with sales/investment milestones. Then ice the cake with a long-term vesting equity stake. This would interest me, and I could bring some a great wealth of experience and talent to bear on both business development and corporate development.
I am so clear on this that I won't get involved any other way. This may be tough for a founder to hear, but any talent looking for a great opportunity will probably say the same.
If the time to grow your business is right now, you may also look to your board of directors for help. At this stage, you should have picked board members that can provide limited resources part time, but can commit to a number of years. This is significant talent. These people will be contributors of one or more primary pieces of success. They will be strategic partners, possible clients, or experts. They will bring resources to the table. Standard practice for board members of a start-up is to compensate these board members with vesting equity. However, if you need someone to hit the phones, visit clients, or create documentation- you will need to hire.
Entrepreneurs are brave and courageous. They deserve respect and loyalty. But they must also grant this to those that help them realize their dreams. Properly executed this will pay dividends to the success of the business over the years.
Tuesday, December 11, 2007
Entrepreneurship: To be King, or to be Rich?
In my last post, I talked about two styles of entrepreneurship, "Lifestyle" and "Impact". There is another way to look at entrepreneurship and what you want from it. This is not so different from the last discussion, but has a different view point of the same thing.
When engaging an entrepreneur, I ask them the question, "Do you want to be King, or do you want to be Rich?" Most reply that they want to be Rich, without hesitation, but when I look at their business, I see that they are King, which prevents them from being Rich.
Undoubtedly, every entrepreneur has a bit of each. It takes ego to be an entrepreneur, and ego likes to be King. However, it is only through the discipline of suppressing the King ego can we become Rich.
Kings, at least in the old days, had absolute control of their kingdom. They were the end-all of decision making and had absolutely power. Most small business today is run in such a way. This is not to say it is inefficient or unprofitable, but that profit's growth is limited by the organizational structure. Without delegation of power, an organization's growth is limited to only what the King can handle. Different Kings has different limitations, but the limitation exists none-the-less.
Kings often hold all the expertise and believe that they alone know the best way to rule their kingdom. Again, this has growth limitations that are obvious. Kings are often married to one goal as well. That their kingdom will be most successful doing X and Y in the Z market. And they know this better than anyone.
To become truly Rich, one must let go of all these limitations. Responsibility and expertise must be delegated. Control must be relinquished. Others must be allowed to participate in the growth and the rewards. Bill Gates did not become the wealthiest man in the world alone. Microsoft created dozens of billionaires, each with ownership of one piece of that success.
Here is the key distinction: Is it more important to you that you be successful or that your company is successful? Do you want to be King, or do you want your company to be King? Are you willing to give up some Kingship to be Rich?
When engaging an entrepreneur, I ask them the question, "Do you want to be King, or do you want to be Rich?" Most reply that they want to be Rich, without hesitation, but when I look at their business, I see that they are King, which prevents them from being Rich.
Undoubtedly, every entrepreneur has a bit of each. It takes ego to be an entrepreneur, and ego likes to be King. However, it is only through the discipline of suppressing the King ego can we become Rich.
Kings, at least in the old days, had absolute control of their kingdom. They were the end-all of decision making and had absolutely power. Most small business today is run in such a way. This is not to say it is inefficient or unprofitable, but that profit's growth is limited by the organizational structure. Without delegation of power, an organization's growth is limited to only what the King can handle. Different Kings has different limitations, but the limitation exists none-the-less.
Kings often hold all the expertise and believe that they alone know the best way to rule their kingdom. Again, this has growth limitations that are obvious. Kings are often married to one goal as well. That their kingdom will be most successful doing X and Y in the Z market. And they know this better than anyone.
To become truly Rich, one must let go of all these limitations. Responsibility and expertise must be delegated. Control must be relinquished. Others must be allowed to participate in the growth and the rewards. Bill Gates did not become the wealthiest man in the world alone. Microsoft created dozens of billionaires, each with ownership of one piece of that success.
Here is the key distinction: Is it more important to you that you be successful or that your company is successful? Do you want to be King, or do you want your company to be King? Are you willing to give up some Kingship to be Rich?
Two Styles Create Two Outcomes of Entrepreneurship
There are many different ways to become an entrepreneur and many different styles of entrepreneurship. However, entrepreneurship can be very roughly categorized into two styles. These can best be defined by their desired outcomes.
The first is a "Lifestyle Entrepreneur". This entrepreneur wants to create a good income for themselves, wants to be in complete control of that income, and wants the flexibility to make lifestyle decisions- such as take the day off to go fishing, or take three weeks off to take a family vacation. In this path, lifestyle may take precedence over overall return on investment. As long as a substantial income continues, the entrepreneur is happy. Most "mom and pop" businesses fall under this category. Most small businesses also fall here, as well as independent professionals such as doctors, dentists, accountants, and attorneys. The risk is often relatively short lived and minimal. One can make a very good living as a Lifestyle entrepreneur,and if they manage their finances smartly, can become independently wealthy. However, at times, lifestyle may trump finances. The business then runs into problems.
The second style of entrepreneurship is what I call a "Impact Entrepreneurship". The desired outcome is high-growth. This type of entrepreneur typically wants to grow from a small business to a large business. They want to either make an impact on the world or create great wealth- often a combination of both. These people are willing to undertake larger risk over an extended period of time with the vision of large returns. The organization is designed (or should be) for constant and radical growth (2-4x revenue each year). Margins are thin in the first 3-5 years. However, once high-growth has been achieved, some very attractive exit strategies materialize. A first or second round of funding can occur to take growth to the next level. Or the company for a significant profit to the owner. Both can create great wealth, the first allows the entrepreneur to continue to create an impact or "change the world".
Sometimes a lifestyle business will accidentally convert to a high-growth business. This may be driven by changing goals of the the entrepreneur. However, sometimes it just happens because the business is at the right location, in the right industry, with a rapidly growing demand. In these cases, the entrepreneur must make a choice to change personal goals and lifestyle, or to suppress the business. This decision is often be delayed because the entrepreneur is uncomfortable with the related decisions. Delay serves to suppress the business. Organizational, financial, and quality control decisions that support high growth are not made. The business can begin to crumble. Perhaps not immediately, but surely over time.
Lifestyle entrepreneurship is most often engaged to create a sense of independence, that the entrepreneur is not reliant upon anyone for income, expertise, and lifestyle decisions. It takes time to achieve this goal. Lifestyle entrepreneurs are often frustrated with slower results. Further, if presented with a high-growth opportunity, Lifestyle entrepreneurs are often reluctant to give up independence and decision-making power. Impact entrepreneurship is dependent upon many factors. Financial obligation exist to investors, banks, or both. Expertise is generally held by an employee or partner. Decisions must be delegated. The market is often more volatile. Business travel is required. Time obligations are intense. This is a much different lifestyle.
The rewards are different. Successful Lifestyle entrepreneurship creates financial freedom and a fluid lifestyle relatively quickly. It creates a "family" business that can be passed on. It creates the satisfaction of being a business owner. Successful Impact entrepreneurship creates significant personal wealth, but is delayed 5-15 years. This personal wealth creates greater freedom and can be passed on to family or charity. It creates the satisfaction of having made an impact on the world around you.
Neither is the right way. But both have distinctive requirements and a conscious decision should be made at all times to engage in one or the other. You may have to make this decision every year. Your personal goals may change. Life is like that. But we must make the decision and take responsibility for the obligations and rewards associated.
The first is a "Lifestyle Entrepreneur". This entrepreneur wants to create a good income for themselves, wants to be in complete control of that income, and wants the flexibility to make lifestyle decisions- such as take the day off to go fishing, or take three weeks off to take a family vacation. In this path, lifestyle may take precedence over overall return on investment. As long as a substantial income continues, the entrepreneur is happy. Most "mom and pop" businesses fall under this category. Most small businesses also fall here, as well as independent professionals such as doctors, dentists, accountants, and attorneys. The risk is often relatively short lived and minimal. One can make a very good living as a Lifestyle entrepreneur,and if they manage their finances smartly, can become independently wealthy. However, at times, lifestyle may trump finances. The business then runs into problems.
The second style of entrepreneurship is what I call a "Impact Entrepreneurship". The desired outcome is high-growth. This type of entrepreneur typically wants to grow from a small business to a large business. They want to either make an impact on the world or create great wealth- often a combination of both. These people are willing to undertake larger risk over an extended period of time with the vision of large returns. The organization is designed (or should be) for constant and radical growth (2-4x revenue each year). Margins are thin in the first 3-5 years. However, once high-growth has been achieved, some very attractive exit strategies materialize. A first or second round of funding can occur to take growth to the next level. Or the company for a significant profit to the owner. Both can create great wealth, the first allows the entrepreneur to continue to create an impact or "change the world".
Sometimes a lifestyle business will accidentally convert to a high-growth business. This may be driven by changing goals of the the entrepreneur. However, sometimes it just happens because the business is at the right location, in the right industry, with a rapidly growing demand. In these cases, the entrepreneur must make a choice to change personal goals and lifestyle, or to suppress the business. This decision is often be delayed because the entrepreneur is uncomfortable with the related decisions. Delay serves to suppress the business. Organizational, financial, and quality control decisions that support high growth are not made. The business can begin to crumble. Perhaps not immediately, but surely over time.
Lifestyle entrepreneurship is most often engaged to create a sense of independence, that the entrepreneur is not reliant upon anyone for income, expertise, and lifestyle decisions. It takes time to achieve this goal. Lifestyle entrepreneurs are often frustrated with slower results. Further, if presented with a high-growth opportunity, Lifestyle entrepreneurs are often reluctant to give up independence and decision-making power. Impact entrepreneurship is dependent upon many factors. Financial obligation exist to investors, banks, or both. Expertise is generally held by an employee or partner. Decisions must be delegated. The market is often more volatile. Business travel is required. Time obligations are intense. This is a much different lifestyle.
The rewards are different. Successful Lifestyle entrepreneurship creates financial freedom and a fluid lifestyle relatively quickly. It creates a "family" business that can be passed on. It creates the satisfaction of being a business owner. Successful Impact entrepreneurship creates significant personal wealth, but is delayed 5-15 years. This personal wealth creates greater freedom and can be passed on to family or charity. It creates the satisfaction of having made an impact on the world around you.
Neither is the right way. But both have distinctive requirements and a conscious decision should be made at all times to engage in one or the other. You may have to make this decision every year. Your personal goals may change. Life is like that. But we must make the decision and take responsibility for the obligations and rewards associated.
Monday, November 12, 2007
The 4th Component of Entrepreneurial Success: Capital
In the first article on this site, I wrote "Energy can be defined as four things in this case (and in most cases): time, capital, action, and commitment.... A successful entrepreneurial enterprise needs high levels of all four components. With these investments- and a decent idea- any business can be Manifested." The time has come to address the most sensitive and mysterious of these: Capital.
I am often approached with the request, "Can you help me get some money?". My answer is, "Sure, how are you selling?" The reply is usually, "Well, I am not selling anything, but I have a great idea!" That's swell, really neat.
There is a series of articles that I will write on this point and I am here to say that I am not the authority on raising money, but I get it. I know how to do it. Let's cover the basics in this article, and we will digress after that.
The bottom line is this: If you want someone to invest money in your business, you MUST show them how they will make a RETURN on that investment.
I am now going to repeat that in many other forms. An idea is worth nothing. Revenue is worth everything. It doesn't matter how great the idea is, you have to be able to sell a product to create value. An idea creates no returns, revenue creates returns. An investor wants to make more money on their money. They do not invest in a great idea, they invest in revenue. If you can't show how you are going to create revenue, your idea is worth nothing.
OK. Now that we got that out of the way, I am betting that at least half of you don't get it yet. The single biggest problem with a start-up is the entrepreneur only builds half the business. Most entrepreneurs start-up with a passion for creation. I don't discount this. In fact, I applaud it. I don't have it. I have a passion for the other half. Taking the business to market. In order for any business to be successful, you have to be able to take it to market.
Therein lies the twist, the mystery and the key to success. In order to be successful, you don't need to have money, you need to be capable of making money. If you can demonstrate this capability, or at least show me a great plan, I can find you investment capital. Angel funds, angels, and private equity will flock to your business.
I am often approached with the request, "Can you help me get some money?". My answer is, "Sure, how are you selling?" The reply is usually, "Well, I am not selling anything, but I have a great idea!" That's swell, really neat.
There is a series of articles that I will write on this point and I am here to say that I am not the authority on raising money, but I get it. I know how to do it. Let's cover the basics in this article, and we will digress after that.
The bottom line is this: If you want someone to invest money in your business, you MUST show them how they will make a RETURN on that investment.
I am now going to repeat that in many other forms. An idea is worth nothing. Revenue is worth everything. It doesn't matter how great the idea is, you have to be able to sell a product to create value. An idea creates no returns, revenue creates returns. An investor wants to make more money on their money. They do not invest in a great idea, they invest in revenue. If you can't show how you are going to create revenue, your idea is worth nothing.
OK. Now that we got that out of the way, I am betting that at least half of you don't get it yet. The single biggest problem with a start-up is the entrepreneur only builds half the business. Most entrepreneurs start-up with a passion for creation. I don't discount this. In fact, I applaud it. I don't have it. I have a passion for the other half. Taking the business to market. In order for any business to be successful, you have to be able to take it to market.
Therein lies the twist, the mystery and the key to success. In order to be successful, you don't need to have money, you need to be capable of making money. If you can demonstrate this capability, or at least show me a great plan, I can find you investment capital. Angel funds, angels, and private equity will flock to your business.
Thursday, November 8, 2007
The 3rd Component of Entrepreneurial Manifestation: Action
In the first article on this site, I wrote "Energy can be defined as four things in this case (and in most cases): time, capital, action, and commitment.... A successful entrepreneurial enterprise needs high levels of all four components. With these investments- and a decent idea- any business can be Manifested."
In start-up, turnaround, and growth phases of business, consistent and progressive action is critical to success. It is about momentum, or the flywheel effect. A little bit of action feeds momentum, which creates more action, which creates more momentum, and so on. Similarly, if action pauses or ceases, the wheel slows and can rapidly come to a stop.
Everyone understands this. There is no need to type a slew of words to describe it over and over. Why then do we let action die? The answer is simple: excuses. Excuses are the enemy of action. Excuses are the antagonist of entrepreneurial ventures. Excuses have the ability to kill a business before it starts.
Excuses can kill action very subtly and quietly. For example, we have to wait on X before we can proceed with Y. Seems pretty straight forward. Things happen in progression, right? No. Milestones may happen in progression. But tasks leading to milestones may often happen concurrently. Let's take an example.
Bob is ready to open his bakery, but the outside needs painting. The painters are delayed by two weeks (aren't they always?). Bob doesn't want to open the store before the storefront is ready. He can list 6 reasons why he shouldn't. 5 are very good reasons, but they are all excuses. Bob can open the shop today. Sure, people might be leery of entering a store with peeling paint. Sure, Bob will have to set up a protective covering to shield customers as they enter. Sure, he will have to set up extra ventilation in the front of the store so that customers can smell the bread. But he will be moving forward. And when the painters finally finish, his sparkling new store front will already be open, will have a few customers, and will be ready for a Grand Opening fiesta.
This is an exceedingly simple example with many holes. But more complex examples involving agents and lawyers are the same. The question is, "What CAN I DO to keep momentum rolling?" Look for housekeeping tasks: strategic plans, business plans, accounting systems. Operational planning has dozens of tasks that can be revisited at any time. Marketing research can be done at anytime (and should be). Strategic relationships can be fostered.
At the end of every day, ask yourself, "What did I do today to grow my business? How did I feed the flywheel today?" Because if you didn't feed it, it is slowing to a stop. And no excuse is good enough to let that happen.
In start-up, turnaround, and growth phases of business, consistent and progressive action is critical to success. It is about momentum, or the flywheel effect. A little bit of action feeds momentum, which creates more action, which creates more momentum, and so on. Similarly, if action pauses or ceases, the wheel slows and can rapidly come to a stop.
Everyone understands this. There is no need to type a slew of words to describe it over and over. Why then do we let action die? The answer is simple: excuses. Excuses are the enemy of action. Excuses are the antagonist of entrepreneurial ventures. Excuses have the ability to kill a business before it starts.
Excuses can kill action very subtly and quietly. For example, we have to wait on X before we can proceed with Y. Seems pretty straight forward. Things happen in progression, right? No. Milestones may happen in progression. But tasks leading to milestones may often happen concurrently. Let's take an example.
Bob is ready to open his bakery, but the outside needs painting. The painters are delayed by two weeks (aren't they always?). Bob doesn't want to open the store before the storefront is ready. He can list 6 reasons why he shouldn't. 5 are very good reasons, but they are all excuses. Bob can open the shop today. Sure, people might be leery of entering a store with peeling paint. Sure, Bob will have to set up a protective covering to shield customers as they enter. Sure, he will have to set up extra ventilation in the front of the store so that customers can smell the bread. But he will be moving forward. And when the painters finally finish, his sparkling new store front will already be open, will have a few customers, and will be ready for a Grand Opening fiesta.
This is an exceedingly simple example with many holes. But more complex examples involving agents and lawyers are the same. The question is, "What CAN I DO to keep momentum rolling?" Look for housekeeping tasks: strategic plans, business plans, accounting systems. Operational planning has dozens of tasks that can be revisited at any time. Marketing research can be done at anytime (and should be). Strategic relationships can be fostered.
At the end of every day, ask yourself, "What did I do today to grow my business? How did I feed the flywheel today?" Because if you didn't feed it, it is slowing to a stop. And no excuse is good enough to let that happen.
Friday, October 26, 2007
Leaping is fun with a parachute!
A leap faith is often noted as a blind jump into the unknown. I take issue with this. When the topic comes up, I respond that, "Leaping is fun with a parachute!" I currently and frequently have taken huge leaps of faith. I have, as often as not, plunged to the ground. As time passes however, I find myself soaring more often. I have learned two important lessons that help me create a parachute.
First, your single biggest responsibility is absolute commitment, with no doubts. It is critical to hold the vision. Never look back from the leap. The minute you let the vision go, your commitment falters, and with it your performance, creativity, and motivation. You become part of the problem. You then MUST accept full responsibility for any failures that follow, even those not directly related to you. Because doubt is contagious.
Second, because leaps require such commitment, it is essential to remove risks as early and quickly as possible. You should never leap into thin air. Learn critical assumption planning. Identify where assumptions are being made by yourself and other principals. Remove those assumptions by testing. Do so very early, before taking the leap, if at all possible.
It took some hard falls to learn these lessons, and they are reinforced daily. But those lessons create growing success and I have learned to relish the results.
First, your single biggest responsibility is absolute commitment, with no doubts. It is critical to hold the vision. Never look back from the leap. The minute you let the vision go, your commitment falters, and with it your performance, creativity, and motivation. You become part of the problem. You then MUST accept full responsibility for any failures that follow, even those not directly related to you. Because doubt is contagious.
Second, because leaps require such commitment, it is essential to remove risks as early and quickly as possible. You should never leap into thin air. Learn critical assumption planning. Identify where assumptions are being made by yourself and other principals. Remove those assumptions by testing. Do so very early, before taking the leap, if at all possible.
It took some hard falls to learn these lessons, and they are reinforced daily. But those lessons create growing success and I have learned to relish the results.
Friday, October 19, 2007
The 2nd Component of Entrepreneurial Manifestation: Time
In the first article on this site, I wrote "Energy can be defined as four things in this case (and in most cases): time, money, action, and commitment.... A successful entrepreneurial enterprise needs high levels of all four components. With these investments- and a decent idea- any business can be Manifested."
Let's talk about time. Time is the one thing that is finite. We can't make more of it. We can make more time available by a variety of time a management methods or simply by paying others to do things for you, hence "freeing" your time. We can not, however, add more time to the overall pool. Time is perhaps the only real direct, flexible expense.
The hard truth in entrepreneurship is also that you may not be able to pay someone else to do what you do. Someone with your expertise may be exceedingly difficult to find. Once you find that person, they may not be able to make the logical leaps you have to get to the right ideas. Or keep those idea secret may be part of your intellectual property. Once you solve all those problems, you could find that another person simply does not fit well in the scenario- they are the wrong person for that "seat on the bus".
Entrepreneurship will take time, and a ton of it. To best ensure the success of the venture, key personnel must be able to commit to the venture full-time. They must clear their time of other things to create as much "free time" as possible. This free time is then "occupied" by the new venture. This takes on a number of strategic advantages. First, the key personnel will not be distracted by other things. This is very important to maximize productivity within the chronological parameters. Second, you will be able to commit the most actual production time within a set quantity of hours. In other words, you will get the most work out of the most time by your key personnel. This moves the venture along as quickly as possible, which is often critical to its success. We will talk more about this when we talk about "action" in the next article.
A talk about investing time energy would not be complete without a discussion of money. Time inevitably costs money. If key personnel are worried about how their mortgage is going to be paid, they can not maximize productivity. And they must be rewarded for their innovation. Reward can be delayed with stock options, and even some salaries can be deferred, but an understanding of compensation must be agreed upon early to ensure that time can be absolutely focused on success.
Let's talk about time. Time is the one thing that is finite. We can't make more of it. We can make more time available by a variety of time a management methods or simply by paying others to do things for you, hence "freeing" your time. We can not, however, add more time to the overall pool. Time is perhaps the only real direct, flexible expense.
The hard truth in entrepreneurship is also that you may not be able to pay someone else to do what you do. Someone with your expertise may be exceedingly difficult to find. Once you find that person, they may not be able to make the logical leaps you have to get to the right ideas. Or keep those idea secret may be part of your intellectual property. Once you solve all those problems, you could find that another person simply does not fit well in the scenario- they are the wrong person for that "seat on the bus".
Entrepreneurship will take time, and a ton of it. To best ensure the success of the venture, key personnel must be able to commit to the venture full-time. They must clear their time of other things to create as much "free time" as possible. This free time is then "occupied" by the new venture. This takes on a number of strategic advantages. First, the key personnel will not be distracted by other things. This is very important to maximize productivity within the chronological parameters. Second, you will be able to commit the most actual production time within a set quantity of hours. In other words, you will get the most work out of the most time by your key personnel. This moves the venture along as quickly as possible, which is often critical to its success. We will talk more about this when we talk about "action" in the next article.
A talk about investing time energy would not be complete without a discussion of money. Time inevitably costs money. If key personnel are worried about how their mortgage is going to be paid, they can not maximize productivity. And they must be rewarded for their innovation. Reward can be delayed with stock options, and even some salaries can be deferred, but an understanding of compensation must be agreed upon early to ensure that time can be absolutely focused on success.
Thursday, October 18, 2007
The 1st Component of Entrepreneurial Manifestation: Comittment
In the first article on this site, I wrote "Energy can be defined as four things in this case (and in most cases): time, money, action, and commitment.... A successful entrepreneurial enterprise needs high levels of all four components. With these investments- and a decent idea- any business can be Manifested."
The first and most important of these is Commitment. Commitment is the basis upon which the other three components can grow and flourish. Commitment is the driving force. And entrepreneurship needs a driving force, for it is a path full of obstacles, hurdles, challenges, doubts, nay-sayers, and do-nothings. It is only with commitment that time, action, and money can maintain momentum in the face of these fantastic foes.
Commitment can be defined very simply as consistent and imperturbable motivation to achieve a defined outcome. This is best identified in the face of adversity, but it can also be equally recognized in the face of prosperity. As individuals, we are equally likely to "slack off" during good times, as we are to be disheartened during bad. Commitment never wavers from the defined outcome, even in the midst of extraordinary middle success. And need it be said that they exhibit the same steadfast character in the face of failure?
Consistent: firm, coherent; steadfast
Imperturbable: not easily excited or upset; marked by extreme calm and composure
Achieve: obtain, attain; perform, accomplish; succeed.
Define: explain, clarify; limit, set boundaries.
Outcome: consequence, effect, result, event, materialization
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The first and most important of these is Commitment. Commitment is the basis upon which the other three components can grow and flourish. Commitment is the driving force. And entrepreneurship needs a driving force, for it is a path full of obstacles, hurdles, challenges, doubts, nay-sayers, and do-nothings. It is only with commitment that time, action, and money can maintain momentum in the face of these fantastic foes.
Commitment can be defined very simply as consistent and imperturbable motivation to achieve a defined outcome. This is best identified in the face of adversity, but it can also be equally recognized in the face of prosperity. As individuals, we are equally likely to "slack off" during good times, as we are to be disheartened during bad. Commitment never wavers from the defined outcome, even in the midst of extraordinary middle success. And need it be said that they exhibit the same steadfast character in the face of failure?
Consistent: firm, coherent; steadfast
Imperturbable: not easily excited or upset; marked by extreme calm and composure
Achieve: obtain, attain; perform, accomplish; succeed.
Define: explain, clarify; limit, set boundaries.
Outcome: consequence, effect, result, event, materialization
Technorati Profile
Monday, October 8, 2007
Intrapreneurship: Anyday, Everywhere Entrepreneurship
I recently learned a new term that delights me: Intrapreneruship. Wikipedia defines an intrapreneur as "the person who focuses on innovation and creativity and who transform a dream or an idea into a profitable venture, by operating within the organizational environment." This delights me for two reasons. First, it steps outside the box that entrepreneurialism is typical placed in. Second, it describes much of my career in a word.
In my bio or my personal elevator pitch, you will frequently find the words "worked within an entrepreneurial environment for much of his career". Now I can just say "career intrapreneur" and be done with it. How great is that? I have not yet started my own high-growth entreprise. I will, later in life. But I have helped many people bring their dreams to fruition. Is that not entrepreneurship just as much as the founding father/mother? The fact of the matter is that entrepreneurial behavior is everywhere. It drives growth in every aspect of life. It is the foundation of evolution. We would not have the wheel or fire without entrepreneurial activity.
For us to package entrepreneurs in a box that says "Sole Proprietor", or "Start-Up", or "Small Business", or "Venture Capital" is completely missing the point. The fact of the matter is that our the word entrepreneur is like the word "snow", one word used to describe an entire variety of actions. The Inuit have more than four dozen words for "snow", each to describe a different type of snowing, or a different type of snow flake. Entrepreneurialism is the same. Here are just a few other words for entrepreneurs: Project Manager, Preacher, Farmer, Broker, Mother, Architect. Entrepreneurs are creators and innovators. They are people that drive change, create growth, and embrace progress. They are everywhere. They are our future.
Post-Script: Anytime that I discuss entrepreneurship in this blog, I am also directly referencing intrapreneurship. The founding principles are one in the same.
In my bio or my personal elevator pitch, you will frequently find the words "worked within an entrepreneurial environment for much of his career". Now I can just say "career intrapreneur" and be done with it. How great is that? I have not yet started my own high-growth entreprise. I will, later in life. But I have helped many people bring their dreams to fruition. Is that not entrepreneurship just as much as the founding father/mother? The fact of the matter is that entrepreneurial behavior is everywhere. It drives growth in every aspect of life. It is the foundation of evolution. We would not have the wheel or fire without entrepreneurial activity.
For us to package entrepreneurs in a box that says "Sole Proprietor", or "Start-Up", or "Small Business", or "Venture Capital" is completely missing the point. The fact of the matter is that our the word entrepreneur is like the word "snow", one word used to describe an entire variety of actions. The Inuit have more than four dozen words for "snow", each to describe a different type of snowing, or a different type of snow flake. Entrepreneurialism is the same. Here are just a few other words for entrepreneurs: Project Manager, Preacher, Farmer, Broker, Mother, Architect. Entrepreneurs are creators and innovators. They are people that drive change, create growth, and embrace progress. They are everywhere. They are our future.
Post-Script: Anytime that I discuss entrepreneurship in this blog, I am also directly referencing intrapreneurship. The founding principles are one in the same.
Wednesday, October 3, 2007
Entrepreneurship: Focusing on the RIGHT Results
Last week, our article discussed manifestation. We talked about focusing our on results to get results. What are the right results for an entrepreneur? Aren't they self apparent? Isn't to run a successful business, to make lots of money, and to create something unique? Of course. Then why is it that so few entrepreneurs are focused on these things? Maybe you are, but is it the foremost objective in your mind?
As the business gains traction, so often we are focused on the daily grind of business. The foremost thing in our mind tends to be those packages need to be shipped before lunch, or that client that wants more shirts before Tuesday, or that circuit that won't work before the prototype rolls, or.... You get the point. We are focused on small issues that are decidedly NOT as important the big picture (though we sometimes fool ourselves that they are). But more pointed, a great majority of our time is focused on obstacles. If 90% of our energy (time, money, action, and commitment) is focused on obstacles, what kind of results should we expect? That's right. Obstacles.
At worst, our obstacles grow in size and context. At best, we manifest solutions and we become a solution factory. Is that why we started the business? Perhaps. Solutions are certainly helpful, but they are not the end product. Remember success, money, and uniqueness? What happened to them?
We often leave those key things to be a two minute motivating speech at the end of staff meetings, or something to talk about at the annual planning retreat, or they are only inspirational words on your wall poster. I hear all your complaints and excuses about energy and resources, and that "its just not practical." You just get swept way in things. Hogwash. If that's what you think, quit acting like an entrepreneur and go get a job. You are short changing yourself and everyone that is counting on your achievements.
Want to really manifest entrepreneurship? First, you have to decide what success is and what idea of success you WILL go after. There are a dozen methods out there that will help you discover this- your brand, your purpose, your Hedgehog concept. The last one, presented in Good to Great by Jim Collins, is the foundation upon which every since has been based. The best selling book discusses it in terms of organizations and businesses, but it works equally well with individuals. It is particularly important for entrepreneurs, building businesses upon themselves. Find the method that works best for you.
The basic idea is this: Identify what you do best, what you are passionate about, and what economic model works best for you. At the intersection of those three things is where you should find yourself. You will have the best chance of success, have them the most fun, and will find the work most rewarding. Now doesn't that sound like a place you want to be?
Once you have figured this out and aligned your business objectives with that concept, you must make sure that those things, not the obstacles, are what stay foremost in your mind. We must remind ourselves on a constant basis why we got into the business, and what the big objectives are. Each of us will develop a unique way to do this. The method is not so important as long as it is done. You might develop a purpose statement that you frame and hang in your home or office, where you see it many times a day. You might spend 10 minutes every day reviewing those big objectives, and an hour every week reviewing your progress. You might enlist someone to hold you accountable to them.
These things may seem hokey, or too warm and fuzzy, but again the question comes into play: How committed are you to your success? How far are you willing to go? How much energy are you will to give? If you want to go all the way, it is critical to put activities in place that will not allow you to get caught up in the daily obstacles. To manifest growth, you must set aside time to focus on growth. You will be surprised how a little energy diverted in this direction will quickly create dividends of success.
As the business gains traction, so often we are focused on the daily grind of business. The foremost thing in our mind tends to be those packages need to be shipped before lunch, or that client that wants more shirts before Tuesday, or that circuit that won't work before the prototype rolls, or.... You get the point. We are focused on small issues that are decidedly NOT as important the big picture (though we sometimes fool ourselves that they are). But more pointed, a great majority of our time is focused on obstacles. If 90% of our energy (time, money, action, and commitment) is focused on obstacles, what kind of results should we expect? That's right. Obstacles.
At worst, our obstacles grow in size and context. At best, we manifest solutions and we become a solution factory. Is that why we started the business? Perhaps. Solutions are certainly helpful, but they are not the end product. Remember success, money, and uniqueness? What happened to them?
We often leave those key things to be a two minute motivating speech at the end of staff meetings, or something to talk about at the annual planning retreat, or they are only inspirational words on your wall poster. I hear all your complaints and excuses about energy and resources, and that "its just not practical." You just get swept way in things. Hogwash. If that's what you think, quit acting like an entrepreneur and go get a job. You are short changing yourself and everyone that is counting on your achievements.
Want to really manifest entrepreneurship? First, you have to decide what success is and what idea of success you WILL go after. There are a dozen methods out there that will help you discover this- your brand, your purpose, your Hedgehog concept. The last one, presented in Good to Great by Jim Collins, is the foundation upon which every since has been based. The best selling book discusses it in terms of organizations and businesses, but it works equally well with individuals. It is particularly important for entrepreneurs, building businesses upon themselves. Find the method that works best for you.
The basic idea is this: Identify what you do best, what you are passionate about, and what economic model works best for you. At the intersection of those three things is where you should find yourself. You will have the best chance of success, have them the most fun, and will find the work most rewarding. Now doesn't that sound like a place you want to be?
Once you have figured this out and aligned your business objectives with that concept, you must make sure that those things, not the obstacles, are what stay foremost in your mind. We must remind ourselves on a constant basis why we got into the business, and what the big objectives are. Each of us will develop a unique way to do this. The method is not so important as long as it is done. You might develop a purpose statement that you frame and hang in your home or office, where you see it many times a day. You might spend 10 minutes every day reviewing those big objectives, and an hour every week reviewing your progress. You might enlist someone to hold you accountable to them.
These things may seem hokey, or too warm and fuzzy, but again the question comes into play: How committed are you to your success? How far are you willing to go? How much energy are you will to give? If you want to go all the way, it is critical to put activities in place that will not allow you to get caught up in the daily obstacles. To manifest growth, you must set aside time to focus on growth. You will be surprised how a little energy diverted in this direction will quickly create dividends of success.
Wednesday, September 26, 2007
Manifestation and the Entrepreneur
So often, entrepreneurs have the wrong results at the forefront of their mind. They are focused on the wrong things. There is a reason, but before we talk about results, let's talk about focus. Most of us by now have seen The Secret or heard the cliff notes on it. Very simply the Secret talks about Manifestation, which I may talk about often here as well. What the Secret teaches is nothing new. I can cite countless texts back to the beginning of time that talk about it. It is simple, what you focus your energy on, you Manifest into reality. So it is with entrepreneurship. The aspect of your business that you focus on is the part that is most successful.
Let me clarify a point about Manifestation. Manifestation is the investment of energy to create an outcome. This energy must talk more than one form. It must take all forms in order for the outcome to be achieved. Let's take the lottery example that most people use to dispute the Secret. The argument is that just by thinking about winning the lottery, I will not win it. No, that's true. You have not invested much energy into it. You focused your thoughts on it, for 15 minutes. But did you buy a ticket? Did you buy ten tickets? Did you buy 10,000 tickets? What is the level of your energetic investment? Buying 1 million tickets would surely increase the chances of winning the lottery significantly, would it not? Ah, I see. You wanted to get a huge return on a very small investment. Manifestation does not work that way. Sorry.
Entrepreneurship does not work that way either. Entrepreneurship requires a huge investment of energy. Energy can be defined as four things in this case (and in most cases): time, money, action, and commitment. Sometimes more of one will compensate for less of another, but to best guarantee success, all must be present, in abundance. This often means a partnership. Those with abundant money can not always invest time and action. Those with available time and action may not be able to invest money. Those that are capable of action, through experience and education, do not always have the time or money. And so on. A successful entrepreneurial enterprise needs high levels of all four components. With these investments- and a decent idea- any business can be Manifested. The abundance of those investment determines the level of manifestation.
Future blogs will discuss the four components of Manifestation in more depth. We will also discuss investing in the right results, outcomes, and ideas. These ideas will focus on the creation and growth of business, but I also hope that my few readers can see the application of these principals to their personal lives. For how your business is a reflection and hence, a manifestation, of your person. Initially, this blog will be about the philosophy of entrepreneurship, however, I will try to include some valuable resources and systems to help you on your way. However, the philosphy of entrepreneurship is the cornerstone of successful ventures, and most often missing entirely from the equation.
Let me clarify a point about Manifestation. Manifestation is the investment of energy to create an outcome. This energy must talk more than one form. It must take all forms in order for the outcome to be achieved. Let's take the lottery example that most people use to dispute the Secret. The argument is that just by thinking about winning the lottery, I will not win it. No, that's true. You have not invested much energy into it. You focused your thoughts on it, for 15 minutes. But did you buy a ticket? Did you buy ten tickets? Did you buy 10,000 tickets? What is the level of your energetic investment? Buying 1 million tickets would surely increase the chances of winning the lottery significantly, would it not? Ah, I see. You wanted to get a huge return on a very small investment. Manifestation does not work that way. Sorry.
Entrepreneurship does not work that way either. Entrepreneurship requires a huge investment of energy. Energy can be defined as four things in this case (and in most cases): time, money, action, and commitment. Sometimes more of one will compensate for less of another, but to best guarantee success, all must be present, in abundance. This often means a partnership. Those with abundant money can not always invest time and action. Those with available time and action may not be able to invest money. Those that are capable of action, through experience and education, do not always have the time or money. And so on. A successful entrepreneurial enterprise needs high levels of all four components. With these investments- and a decent idea- any business can be Manifested. The abundance of those investment determines the level of manifestation.
Future blogs will discuss the four components of Manifestation in more depth. We will also discuss investing in the right results, outcomes, and ideas. These ideas will focus on the creation and growth of business, but I also hope that my few readers can see the application of these principals to their personal lives. For how your business is a reflection and hence, a manifestation, of your person. Initially, this blog will be about the philosophy of entrepreneurship, however, I will try to include some valuable resources and systems to help you on your way. However, the philosphy of entrepreneurship is the cornerstone of successful ventures, and most often missing entirely from the equation.
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