Here is a recap of highlights, quotes, and comments from articles and discussions posted on the Applied Entrepreneurship group site on LinkedIn.
*100 Tips and Tools to Research the Social Web by Social Guy
“The social web is an often overlooked resource full of excellent information. Whether you’re working on a research project, building your brand, or just trying to find some information, look to social media sites to find what you’re looking for.”
This article takes a look at “100 tips and tools for effectively researching the social web.”
* 100+ Useful Niche Search Engines You’ve Never Heard Of by Social Guy
“Though the general Google site is often touted as the number one search engine online, college students sometimes need more specific tools to help them uncover quality information on the Web that they can use for class projects, research papers, and even job and apartment searches. This list features a huge variety of search engines that can be useful to students, including tools that find photos, sound effects, summer internships, health and medical information, reference guides, and a lot more.”
* 100 Twitter Tools to Help You Achieve All Your Goals by Social Guy
“Twitter has become an incredible tool not just for communication, but for improving your life. College students can use it to expand their social circle, promote their side business, keep their coursework organized, and more. Whether you want to achieve your Twitter goals, or just use it as a tool to achieve others, these twitter tools will help you get there.”
* Top Twitter Tools to Check Out in 2009 by Social Guy
“You have probably heard something about the new micro blogging platform, Twitter, and how Twitter has taken the online marketing world by storm. The phenomenon has even spawned a new lingo, with your new tweeps (followers) tweeting (making posts) you and discussing the state of the Twitterverse.”
“While Twitter is pretty easy to use, there’s an overwhelming amount of Twitter tools, plug-ins and applications being developed to support it. How can you determine which ones will best support you in your use of Twitter?”
* 9 Tips to Increase Your Technorati Rank Quickly by Social Guy
“For some people, their blogs Technorati rank is confusing and they do not fully understand it. Even more confusing for many bloggers is how to increase your Technorati rank and increase it rather quickly.”
“The Technorati rank is how many other blogs in Technorati actually link back to your blog. Not how many blogs link back to you, but how many blogs Technorati knows about that link back to yours.”
“It’s important to understand that a blog has to be claimed by its owner on Technorati. To claim it, all you do is open a free account with Technorati and follow directions on how to claim your blog.”
“Many bloggers and Webmasters do not understand why a blogs Technorati ranking is important. If you don’t care about selling ads or links on your blog, then the Technorati rank is probably worthless to you. On the other hand, a low Technorati rank (low means good here) can increase the amount you’re paid for links or sponsored reviews.”
* A Vision Beyond Virtual by Andy Bourland and Ann Handley
“ClickZ was born in May 1997, in a couple of spare bedrooms. With a real need to make this baby profitable as quickly as possible, we kept costs low. We modestly outfitted our home offices with separate phone lines, used fax machines and cast-off office furniture.”
The founders cautiously hired first one, then two employees, who worked as contractors from their own home PCs.
“Raising a company, we discovered, can be a lot like raising kids. Sometimes, you’ve got to plug in and nurture them with abandon. And sometimes, you’ve just got to know when to get out of the way. And when you get too attached to doing things a certain way, the child changes and makes you readjust your thinking.”
ClickZ was funded by a few barter deals and a low-balance credit card. “We were partners who fed off each other’s energy and ideas. We needed face time.”
“Running our company virtually required a huge component of communication. We assumed that because we were highly wired, well connected with one another, that we were efficient and executing at top speed. But, guess what we discovered? We weren’t. We were actually incredibly inefficient. And we were far slower to execute on our business plans than we could have been otherwise.”
The founders discovered, almost immediately after we moved into their new office, that the amount of time they needed to communicate was cut in half. “While going virtual in the launch phase made a great deal of sense, as time went on, it really hindered our growth.”
* Anticipating Early Termination of a Strategic Partnership by Daniel S. Porper
“Parties often fail to give the same type of attention to the winding-down of the relationship when things do not go as planned. Whatever the reason for the early termination, there can be significant economic consequences to the parties.”
“The primary issues to address are as follows:
- Who will own intellectual property developed in connection with the partnership? While the parties will have agreed to the allocation of intellectual property rights during the normal course of the relationship, the parties may intend a different result as a consequence of the early termination.
- Will a party have a license to use the other party’s technology? If so, what are the associated financial terms, if any?
- Who will own tangible assets relating to the technology, such as manufacturing equipment?
- Who will own regulatory approvals relating to the technology?
- Are there any termination fees or reimbursable costs and expenses?
- Will the parties provide transition services to each other?
- Will the parties be subject to non-solicitation or non-competition covenants?”
* Ancient Materials, Modern Technology, Timeless Challenges by Richard Rhodes
The company “rescues” ancient materials from all over the world that are in danger of being destroyed. “Then we resell these items and give them new life and new uses.”
“We create value at every step of the process—buying the material from people who are going to lose their property, preserving the material, hiring people in areas of chronic unemployment to remove, process and crate it. Then we create value to our customers, giving this legacy material a new life elsewhere.”
“Using the latest technology also helps us attract the best people overseas. When you’re working in countries that aren’t as technologically advanced as the United States, the promise of being able to be trained to use digital equipment can be a persuasive way to build the best possible local team.”
“From a legal perspective, dealing in developing countries, I’ve learned that contracts and agreements help you clarify expectations—and that’s all they do. They are essentially unenforceable. We still write them and sign them, but we’re never really sure we’ll be able to compel anyone to stick to the printed word.”
Customer involvement avoids problems, by getting customers engaged in the process. That, in turn, makes them aware of just how complicated the process is, excites them, and “if clients are excited about the process and the story behind what they’re buying, chances are they’ll become more flexible on the deadlines.”
* Basics of Company Valuation by Andrew J. Sherman
“Formal valuation of the seller’s business is a vital component of the buyer’s analysis when discussing a proposed acquisition. The valuation of a business in the context of an acquisition, as opposed to estate planning or other purposes, often involves consideration of “investment” or “strategic” value beyond a street analysis of fair market value.”
“Company valuation is not an exact science, nor will valuation issues typically drive the terms and pricing of the transaction. There are numerous acceptable valuation methods and, in most situations, each will yield a different result.”
“All three main methods of valuation are open to debate and differences of opinion. The methods are useful in that they provide starting points and supply a range of reasonable values backed by various valid manners of justification. Even so, the value or price of a company is dependent on the particular time of the valuation and on the true motivations and goals of the key players involved in the transaction.”
There are unique challenges conducting a valuation for a smaller company with deals in the $1-million to $250-million range. “These smaller, closely-held businesses will be more difficult to evaluate, because of certain ‘information risks’ that can also result in lower valuations.” These challenges include:
- Lack of externally generated information, including analyst coverage, resulting in a lack of forecasts.
- Lack of adequate press coverage and other avenues to disseminate company- generated information.
- Lack of internal controls.
- Possible lack of internal reporting
“The professional business appraiser should also examine the seller’s intangible assets when determining strategic value. The inventory of intangible assets includes such items as customer lists, intellectual property, patents, license and distributorship agreements, regulatory approvals, leasehold interests and employment contracts. Since certain intangibles may not be readily apparent, the more specifics the seller can supply, the more likely it is that they will enhance the valuation.”
* Bet on the Horse; Determining Success Factors of New Businesses by Steven N. Kaplan
The article gives information about a new study “What are Firms? Evolution from Birth to Public Companies,” by University of Chicago Graduate School of Business. The study analized 49 companies financed by venture capitalists. The purpose was to help resolve the debate between those venture capitalists who believe a company’s product and market are the key determinants of its success, while others believe the company’s management team holds the key. This debate is often characterized as whether VCs should bet on the jockey (management) or the horse (product/market) when selecting their investments. They also assessed which characteristics stay constant, change, or disappear as companies evolve.
“The most striking and surprising result was the almost complete stability of firm business models. Only one company saw its core business change. Within the same core businesses, firm activities tended to stay the same or broaden over time.”
“Firms stressed the importance of proprietary intellectual property, patents, and physical assets in all three stages, and these characteristics became increasingly important over time. Though the human capital of the sample firms changed substantially, the uniqueness of the firm, nonpeople assets, customers, and competitors remained relatively constant.”
“Intellectual property, whether patented or not, is substantially more important than physical assets.”
What I Think
May 12th was “Tool Time.” About half of the postings were from Sociable Blog http://www.socialbleblog.com and were devoted to tips and tools on niche search engines and use of new communication and marketing tools, such as Twitter.
I have to admit that after testing a few of the hundreds of tools and search engines, I was impressed at just how far we have come in getting to the social/business media metrics. I was equally impressed with how many tools are out there to help the entrepreneur learn about competitors, market, customers, new products, ways to innovate, and about themselves and their online reputation.
The ClickZ story is, in many ways, a very familiar one to me. Many of my clients start on the proverbial shoestring and the founders of ClickZ seem to have done just that. They also found that they were not as smart as they thought and that their communication skills and lack of infrastructure kept them from reaching a higher level of success at an earlier stage.
Several other recent articles I have posted here tell the same story. Spend at least part of each week in the same room with your “partners” and key team members. We are not yet so “connected” that we can avoid losing some of the chemistry and ability to innovate, which we might otherwise be able to take advantage of if we had more “face time” with our co-founders and other critical members of the start-up team.
It appears that the intellectual property developed in these early war room meetings, becomes a critical element in the value venture capitalists place on start-ups. This appears, from the University of Chicago Graduate School of Business study to be even more important than the management team, that being subject to relatively easy replacement. That is probably even more true today, with so many high level people looking for a job. Creating the intellectual property is a key.
On the other hand, our valuation article points out that many companies undervalue, or perhaps even totally miss the value of their own intellectual property. For many years, I have given my clients an intellectual property self-audit form and helped them identify their intellectual property assets. I often find, with my more successful and innovative clients, that they really don’t fully understand the value they are creating. They understand that they are beating the competition in some way, but they don’t realize they can protect and retain company value from the IP they are creating. Likewise, they may also misunderstand how easily it can be lost if they don’t take appropriate measures to protect it.
That, of course, brings up the article, Anticipating Early Termination of a Strategic Partnership. Aside from the many good factors mentioned in that article, getting a non-disclosure agreement from prospective partners early on, as well as negotiating and executing a well writing non-compete agreement and an equally well prepared buy-sell agreement at the earliest possible stage, will help ensure that everybody knows where they stand as they march down the road to success, or failure. The consequences of either end justifies the urgency of preparing a good and solid foundation at the beginning.
Now let us all repeat the Steven Covey mantra: “begin with the end in mind.”
If you enjoyed my impression of these articles, why don’t you read them for yourself and see what you and I missed or hit? Join the Applied Entrepreneurship group on LinkedIn. Membership is free and I try to post about ten articles a day there. We have some great discussions going and if you are an entrepreneur, we hope you will join us.