This is a digest and recap of highlights, quotes, and comments from articles and discussions posted on this date on the Applied Entrepreneurship, LinkedIn group site.
* 10 Lessons Learned in 22 Years of Bootstrapping by Tim Berry
“Last week a group of students interviewed me, as part of a class project, looking for secrets and keys to success. They were asking me because after 22 years of bootstrapping, my wife Vange and I own a business that has 45 employees now, multimillion dollar sales, market leadership in its segment, no outside investors, and no debt. And a second generation is running it now.”
Berry and his wife came up with these 10 lessons:
- We made lots of mistakes.
- We built it around ourselves.
- We offered something other people wanted.
- We planned.
- We spent our own money. We never spent money we didn’t have.
- We used service revenues to invest in products.
- We minded cash flow first, before growth.
- We put growth ahead of profits.
- We hired people slowly and carefully.
- We did for employees’ families as we did for ourselves.
“Bootstrapping is underrated. It took us longer than it might have, but after having reached critical mass, it’s really good to own your own business outright. It might have taken longer, and maybe it was harder — although who knows if we could have done it with investors as partners — but it seems like a good ending.”
“Family business is underrated. There are some special problems, but there are also special advantages too.”
* 7 Tips for Defining Your Business Goals by Keller Hawthorne
“One of the best steps you can take to ensure success for your online business is to specify your goals. It’s amazing how many of my clients can’t tell me how much money they want to make in their first year of business, or how many subscribers they would like to have on their newsletter. If they don’t know what their goal is, how will they know if they’ve succeeded?”
Some of the thoughts on how to keep business goals in line are:
- Keep them Specific!
- Don’t go Overboard
- Be Realistic
- Keep them Dynamic
- Create a Timeline
- Be Good to Yourself!
- Make Learning a Goal
* Four top entrepreneurs talk about business plans, loneliness and the passions that drive them
“What makes an entrepreneur an entrepreneur? Is it a lonely adventure? Are mentors important? These were some of the issues that four prominent entrepreneurs discussed in a panel discussion last year.”
The panelists were:
- Steve Demos, co-founder and chairman of Next Foods Inc., which sells a line of stomach-soothing probiotic juice products.
- Mark Kern, co-founder and chairman of Red 5 Studios Inc., an online-videogame maker. Before starting Red 5, Mr. Kern was the team leader on the popular multiplayer online game World of Warcraft.
- Marion Freijsen, co-founder and chief technology officer of E.Factor, which aids entrepreneurs by providing a virtual platform for the sharing of ideas and experiences.
- Tom Scott, chairman of Plum TV, which operates local television channels in historic, affluent markets such as Aspen, Nantucket, and Martha’s Vineyard. Mr. Scott was a co-founder and chief executive of Nantucket Nectars, which was sold to Cadbury Schweppes for about $100 million in 2002.
Here are some examples of the discussion.
“DEMOS: I think an entrepreneur’s responsibility is get you to the playing field and then listen very carefully to the consumer, because they’re really telling you what to do. I think, as an entrepreneur, I see trends but not specificity. And I look to the market to help me hone and fine-tune the specificity. Remember, I spent 20 years making the most hated food in the U.S., which is tofu, but we ended up on a rocket ship called Silk Soy Milk.”
“What you don’t know is in between those two products there were 200 other products. And we were basically dialing through products to determine where will the consumer show up to eat lower on the food chain.”
“KERN: I think it’s not just about adapting to your consumer and adapting to your marketplace. In my industry, you work with a lot of creative talent and they come on board, initially, for the vision that you hold out to them. But eventually they need to have contributions to that vision as well.”
“So you start out with your vision but it really has to morph and include everyone’s vision on the team, if you want to continue to [attract] the best talent to your company. And you do have to listen to them. You may be very stubborn because you started this thing and you think it’s got to be this way. But listen not just to your consumers, but to what your internal talent is telling you.”
“DEMOS: I think for me, personally, business is all about fulfillment, not achievement. I think achievement accompanies fulfillment, but not the reverse. So we really, honestly weren’t focused on the money because that was going to be the fait accompli if we fulfilled our mission. Meaningful purpose is probably the highest order of use of my consciousness that I can think of.”
“FREIJSEN: Right. Exactly. Being an entrepreneur is a lonely business. I had an entrepreneur turn up at an event. He was almost in tears. He said, this is so great. When I talk at home about my business, my wife only cares about what income I bring in and the rest of my family doesn’t understand. And here I can talk to people who are like me.”
* Sell More by Seeing Your Store Through Customers’ Eyes by Kare Anderson
“In a stressful economic time, coddle customers to keep them. In fact, give them bragging rights about “my store” so they come back and tell others. ”
“Next to value-priced quality products, a motivated staff is the most cost-effective way to stand out from the competition while avoiding costly price wars. So many no-cost and low-cost staff behaviors can make all the difference in how a customer feels about your store. The devil is in the specifics because even the most well-intentioned staffer may unwittingly slight someone. ”
“As customer service expert, Holly Stuhl is fond of saying, “You never get bitten by an elephant. It’s the mosquitoes that eat you alive.”
Anderson’s article outlines ten strategies to improve customer relations for your business.
* Get Help Starting Your Home Based Business by Margie Zable Fisher
“Starting a home business sounds like a terrific idea, until you realize all that’s involved in getting it up and running. So getting some assistance really helps – especially if it doesn’t cost a lot of money.”
“Three successful business owners explain how they found the right opportunity, through a franchise or training program, and made it work for them.”
* High-Tech Start-Ups Put Down Roots in New Soil by Simona Covel
“High-tech start-ups are increasingly setting up shop in places previously not known for attracting high-tech firms.”
“A number of cities, such as Kalamazoo, Mich., and Toledo, Ohio, are offering grant money and tax breaks to high-tech start-ups, just as the usual venture-capital hot spots, such as Silicon Valley and Boston, continue to see a pullback in venture lending. Many of the nontraditional cities require that start-ups receiving grants invest in their area, leaving companies little choice but to locate — or relocate — their businesses.”
“Firms also are being lured by the lower cost of doing business in such cities. And, as the number of high-tech start-ups increases in these areas, existing companies find that as they grow, they no longer have to leave Ohio, Michigan and other states that traditionally have had less to offer in the way of high-tech communities and investors.”
*It’s Time to Reinvent Knowledge Work by John Sviokla
“Most leaders don’t realize that the entire world-wide personal computer revolution is based on thinking that is about as old as the fundamental engineering of the Space Shuttle — circa early 1960s. This thinking was not invented by the technology titans of the time, IBM and AT&T. Instead, it was invented by Xerox (which at the time was just a copier business), and the Rand Corporation, supported by academic and military work.”
“I think it is time to go back to some fundamental innovation around the way high-performance teams conduct complex, time pressured, knowledge work. Creating value and solving new problems in new ways is essential to competitiveness. But executives must be willing to invest in new ways of doing work — and to take some risks. The costs of these efforts are dwarfed by their potential value, but because it takes new, bold thinking to explore this territory, not the lazy mentality of benchmarking or optimization, it will need true leadership to make it happen.”
“As William Gibson, the famed Cyberpunk novelist said: the future is already here, it’s just not evenly distributed. I think the future of knowledge work is here. It’s about figuring out how to create new ways to gather vital information, and linking the experts physically and virtually into a much richer, faster data-world. It is only through this type of reinvention that we’ll get the breakthroughs we need.”
*Twitter’s Ten Rules For Radical Innovators by Umair Haque
“Is the hype justified? Yup: Twitter isn’t just changing how we communicate — it is changing how we innovate.”
“Here are Twitter’s ten rules for radical innovators (which have, just maybe, had a bit of influence when it comes to Twitter).”
- Ideals beat strategies.
- Open beats closed.
- Connection beats transaction.
- Simplicity beats complexity.
- Neighborhoods beat networks.
- Circuits beat channels.
- Laziness beats business.
- Public beats private.
- Messy beats clean.
10. Good beats evil.
*Unique Ways Entrepreneurs Are Raising Money by Diana Ransom
“When Brooklyn coffee shop owner, Debi Ryan, was faced with the possibility of shutting her doors, she appealed to her neighbors, asking them to become mini venture capitalists and invest in her business. As a result, she just hosted a grand re-opening. Instead of taking a loan or seeking venture capital funding, entrepreneur Paula Conway managed to pay for the launch of her travel web site with money she made selling — of all things — cupcakes.”
“Taking such unconventional routes to raise cash has become a necessity for many small-business owners as traditional sources of funding (i.e., venture capital and bank loans) have dried up.” This article describes how several entrepreneurs used such unique tactics to raise money to start their business or to re-start it after being hit with an unexpected financial crisis.
*Three out of Four Americans Believe New Entrepreneurs Are Key to Reviving Economy
“More than two out of every five Americans (42%) have considered starting a business since the economic downturn. Among those Americans, roughly a quarter (24%) have actually acted on the idea. Additionally, three out of four Americans believe new entrepreneurs will do the most to revive the economy and four of five say that at some point they have considered starting their own business. These findings, among others, were revealed today in a national survey from Alibaba.com, the world’s leading business-to-business e-commerce company.”
“Also according to the 2009 Alibaba.com Newpreneur Survey, more than four in ten (44 percent) of Americans who considered starting a business said not knowing “how to handle the logistics, such as where to make or get my products” was one of the top two reasons why they didn’t start their business. That’s greater than those who say that they were afraid of failure (37 percent).”
““The renewed confidence in entrepreneurs is evident across the country and proves that the American dream is still alive and well,” said David Wei, chief executive officer, Alibaba.com. “As the data shows, Americans strongly believe the down economy provides an opportunity for a new class of what we call ‘Newpreneurs’ – people who are using the recession as a catalyst to start a business or develop an idea. Alibaba.com can help Americans turn their dream into a reality by connecting them with business partners and helping them succeed in global trade.”
What I Think
I think many people feel the key to becoming a successful entrepreneur is radical innovation. To them this may mean inventing a new product or service, or providing a revolutionary way to combine existing elements. Undoubtedly, many entrepreneurs have found success in this way. Many, however, have taken a different path.
Looking at the articles posted on this date, there are entrepreneurs involved in everything from probiotic juice products to World of Warcraft. There are, as is often the case, similar threads running between many of the stories. Many started with the excitement of the initial “cool” idea, only to run into problem after problem. One entrepreneur recounted 200 iterations prior to finding a successful product consumers would accept. Stories about others referenced that they had found novel ways to raise enough money to re-open their business after being forced to close.
Certainly, some of the common threads in these articles are perseverance, failure to take no for an answer, and ability to find a work-around after hitting the wall. In the race to the goal, whatever that goal may be, the successful entrepreneur is often the one who can take the punches and get back up off the canvas. Once up, the successful entrepreneurs regroups, figures out what went wrong, and finds a way to make the customer happy.
Twitter may be the new phone system, but when an entrepreneur can raise enough money to start a business by selling cup cakes, innovation is at work.
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.