Tuesday, July 28, 2009

Two Startup "Musts": Marketing and Money

Occasionally I get unsolicited letters from entrepreneurs (Canadian and otherwise) asking for advice, and when I can I try to answer them.

This morning an email drifted in from "Andrew", who is running a Web startup in the Middle East. He had addressed his email not just to me, but to some of the most prominent business and entrepreneurship commentators on the Internet.

I admire that kind of pluck. So I decided to try to be the first responder.

Basically, he wanted advice on raising seed capital. Here is what I told him,

Hi Andrew
I have checked out your website, and think you have a great concept in xxxxxx. I wish you luck with it.

I suggest you immediately secure the service, or advice, of an English-language marketing professional. Your letter, and the lack of branding on the site itself, suggest you need a fresh set of eyes to help you more clearly explain your product and how it creates value for people.

As for funds, I don't know what your contacts are, or what the state of venture capital is in your country. In general, though. I think you are best to bootstrap Internet businesses. (See this recent Inc. Magazine article on "
ramen profitability".

I think your best source of funds is from family and friends. They are the ones who should believe in your dreams first. And their support can often get your business to a level of success at which point banks or other institutional lenders can get interested.

There is not a lot of information out there on asking for "love money", but here
is a link to a story I wrote on the topic last year for MoneySense Magazine.

I wish you all the best!


Rick

Monday, July 27, 2009

Running a business: everything you need, in 1 paragraph

"The principles of running a good business are easily stated in one paragraph: ethics; clear goals; take care of the customer; take care of the employee; product quality and service; innovation; cost control; productivity; sound finance; manage the risk agenda; nimble and flexible; decision-making for the long term; deal with problems; avoid denial; prudence; patience, tone at the top; keep ego out of it; treat everybody the way you want to be treated; beat the competition."

This is the gospel of University of Manitoba prof John S. McCallum, in his recent article, "Executives and the Recession," in the Ivey Business Journal.

Why is he telling people what seems so obvious?

"I have watched management thinking careen through flavours of the day like management by objectives, management by exception, decentralization, Theory X, Theory Y, six sigma, total quality management, reengineering, outsourcing and a gem I especially like, management by walking around. But these principles are about it! Would they were as easily executed from day to day as stated!"

You can read the full article here.

"We Rise Again"

My "low-content mode" this month means it must be another Canadian summer.
What could be more Canadian than Anne Murray, Rita MacNeil, the Rankins, the Gospel Heirs and the Men of the Deeps? All together on a Cape Breton cliff above the sea?

Singing "We Rise Again?"

Enjoy the video.

Wednesday, July 22, 2009

Takin' Care of (Your) Business

Did you ever wonder what goes on in those confidential peer boards run for entrepreneurs by organizations such as YPO or TEC?

On behalf of the Financial Post, I recently got a rare chance to observe a peer group run by The Alternative Board. Lots of interesting insights into how entrepreneurs learn and solve problems.

Here's an excerpt:

Anton, who's in the advertising business, has good and bad news. His marketing efforts are paying off, but he's getting more calls than he can handle. "I think I've bitten off more than I can chew," he says. It turns out he's been getting too involved in physical production, and taking his eye off the motivational side of his job. Around the table, heads nod. It's easy to say, "Work on the business, not in it," but hard to do -- especially if you secretly prefer that work.

You can read this top-secret story in the Post here: http://www.financialpost.com/small-business/story.html?id=1810495

Sunday, July 19, 2009

One small step for a man...

July 20th, 2009 marks the 40th anniversary of the first lunar landing by Apollo 11 and its intrepid crew: Armstrong, Aldrin and Collins.

It turns out that Canadians played a big role in making the moon landing happen.

At a press conference today at the Canadian Air and Space Museum at Downsview Park in Toronto, the contributions of Canadians to this great endeavour will be celebrated for the first time.

* Did you know a Canadian, Owen Maynard, was in charge of NASA’s Lunar Module Program and played a key role in the design of the lunar module?
* Apollo 11 astronaut Buzz Aldrin thanked two former Avro Arrow engineers for their contributions to the success of the Apollo 11 mission.
• More than 25 Canadian engineers left for NASA following the cancellation of the Avro Arrow in 1959, making an indelible mark on the manned space program.

Present at the conference will be Canadian astronauts Roberta Bondar and Bjarni Tryggvason, Avro Arrow Chief Design Engineer Jim Floyd, and Chris Gainor, author of Arrows to the Moon. Along with Canadian aerospace legends and test pilots.

Sounds very, very cool. Hopefully, we will all learn more on the TV news and in the papers.

Plus there will be special messages from Buzz Aldrin, Apollo 15 commander David Scott, and some guy named Harrison Ford. (He will probably be bragging about making the Kessel run in less than 12 parsecs.)

Tuesday, July 14, 2009

Canada in a fog as tech heads for the cloudsphere

Alex Carrick is the inquisitive chief economist for Reed Construction Data in Toronto. Apparently tiring of the bad news in the development industry, he wrote an article recently on the glowing outlook for the tech sector. He’s genuinely excited about the “sweeping nature” of tomorrow’s technological advances.

Here’s a brief recap of his analysis.

· The personal computer may be on its way out. The next wave in personal computing is “cloud” technology. This is where applications and software reside somewhere other than on a PC. Computing functions and files are increasingly being stored on server space rented from others. As a result, many executives can now run their companies in the field from their cell phones.

· Retail is being Turned Upside Down. Even video outlets are being slammed by the Internet. And the latest version of Amazon’s Kindle wireless reading device is expected to alter the book publishing industry.

· The Web Keeps Changing the World: Social networking sites (Facebook, Twitter and LinkedIn) have grown into business promotional and information-sharing sites, as well as job-search sites. During the recent political upheavals in Iran, Twitter became a primary means for people to communicate their dissatisfaction with the official election results. In a related example, China has just backed down on requiring PC makers to install web-filtering technology on all computers sold in the country.

· In the construction industry, Building Information Modeling is about to change the way buildings are designed and constructed. People simply understand things better when they see them in 3D.

· Canada is at a Disadvantage. Since many technology products (see: Kindle) arrive in Canada a year or more later than in the U.S., our developers face a disadvantage. More than 25,000 applications have been written for the iPhone; Canadians firms were held back from the get-go.

You can read the full article here. Or visit http://www.alexcarrick.com/ to read Carrick’s personal blog

100 Non-Business Books Every Entrepreneur Should Read

What does it take to be a well-rounded entrepreneur? The folks at self-help site http://www.onlineuniversities.com/ have just produced a list of the 100 Non-Business Books Every Entrepreneur Should Read.

The anonymous writers claim that while there are hundreds of business books that can help you become better business people, “some of the most useful ones aren’t obviously meant for business at all. You can build your communications, relationship, and presentation skills, and even set yourself up for success by reading books your professor wouldn’t think of assigning you.”

Frankly, there's a lot of repetition and nonsense on this list. But here are a dozen of the most worthwhile books on the list, specially chosen by me because a) I have read them, or b) I think I should:

1. The Elements of Style: Write and communicate clearly with the help of this book.
2. Difficult Conversations: Thrive in difficult conversations.
3. Getting to Yes: Improve your negotiation skills.
4. If It Is To Be It’s Up To Me: Develop the attitude of a true leader.
5. The Fountainhead: Ayn Rand’s classic novel on individual strength and the temptations of compromise.
6. The 7 Habits of Highly Effective People: Improve your personal effectiveness.
7. The Power of Positive Thinking: The power of confidence.
8. What to Say When You Talk to Yourself: How you can become what you tell yourself.
9. Influence: The Psychology of Persuasion: This book explains the psychological foundations of influencing people.
10. The Millionaire Mind: Make your mindset more like a millionaire’s.
11. The Now Habit: Create your own program to overcome procrastination.
12. The Art of War: Learn how to gain advantage of your opponents in any situation.

Click here to read the full article and see how many of these 100 books you have read – or ought to.

Monday, July 13, 2009

Changing the World

Alain Theriault is a thoughtful and bilingual startup coach in Montreal. He used to blog more than he does, but now he puts most of his thoughts and resource recommendations on Twitter.

(I think most of us bloggers will go the way of Twitter eventually. It's so much easier to write one or two sentences than entire coherent pragraphs.)

Anyway, this morning Alain reTweeted a quote that I think is just brilliant. So I wanteds to share it with you.

"Everyone thinks of changing the world, but no one thinks of changing himself."
~Leo Nikolaevich Tolstoy

"Recap" for sales success

Here's a great idea for a Monday morning, from my buddy Kelley Robertson of Fearless Selling. It's not new, but still very powerful.

"Want to impress your prospects and customers? Learn to recap or summarize periodically during your sales conversations."

The process is simple: once you have asked your prospect the probing questions that help you clearly understand their problem, ask for permission to recap what you've just been told. The size of the company, the nature of the problem, the telling details of their pain - all the pertinent details, expressed quickly and sympathetically.

"This deceptively simple technique is effective for several reasons," says Robertson. It forces you to listen carefully, and shows the prospect you've been paying attention. Third, "it helps you clarify in your own mind what your customers' key issues are."

"Develop the habit of recapping during your sales conversation," says Robertson, "and I guarantee that your sales will increase."

Follow Kelley Robertson's advice-filled blog at www.kelleyrobertson.blogspot.com/

Special bonus: What do you do when someone asks, “What’s your best price?” Click here to read Kelley's solution.

Friday, July 10, 2009

eBay Canada launches Entrepreneur of the Year search

By redefining the way people buy and sell stuff, eBay has launched a lot of new businesses. And yesterday eBay Canada launched its fifth annual Entrepreneur of the Year Awards program, to identify Canada’s most successful and entrepreneurial eBay sellers.

This year eBay has also created a "Comeback of the Year" Award, for the entrepreneur who has overcome a recent personal or professional challenge.

Last year’s Entrepreneur of the Year winner was Bryan Hellwig of Iqaluit, Nunavut, who sells Inuit and Northern art online. You can find him on eBay under the name ringseal.

The winner of the 2009 Entrepreneur of the Year Award title will receive:
* $2,000 cash
* $500 towards a business-related course or workshop
* $500 in eBay AdCommerce advertising credits

The winner of the Comeback of the Year Award title receives $1,000 cash, plus $500 towards a business-related course or workshop, and $500 in eBay AdCommerce advertising credits.

Entries must be submitted by August 9, 2009. For more information or to enter, visit: www.ebay.ca/entrepreneurs

Did you know? eBay members trade $2,000 worth of goods every second. Out of 24 million Internet users in Canada, one in four is registered on eBay.

Thursday, July 09, 2009

The Epic Struggle of Jack Poole

Between now and the end of February, you'll hear a lot about Jack Poole, the chairman of VANOC, the organizing committee of the 2010 Winter Olympics in Vancouver.

But before heading up one of the best-organized Games committees ever, Poole was a classic Canadian entrepreneur: a hard-working Saskatchewan boy who made and lost a fortune in Western real estate through Daon Development (remember them?). He has since emerged as one of BC’s top entrepreneurs and philanthropists, and a survivor of pancreatic cancer.

Poole’s story is told in an inspiring article by Gary Mason in BC Business (“Never Say Quit”). You can read it online by clicking here.

To whet your appetite, here are a few of Poole’s quotes from the story:

“It was a real lesson for me. Never keep secrets from your banker.”

“I don’t have any money, but I’ll sign over everything I’ve got.”

“We were extremely successful but had not factored into our plans the recession of 1982 and interest rates of 23 per cent.”

“I came from nothing. And I can go back to that. I can. But if you want me to stay and work this thing through, I will. If you don’t, I’m happy to leave. But don’t threaten me.’”

“My personal wealth went from a paper worth of $100 million to a negative worth of $5 million.”

“I’d never go that route again.”

“One of the things God gave me was the ability to recognize talent, and it’s been one of my great strengths. Anything I’ve achieved is because of the people I’ve hired to do it."

“Every time you win something, it has to hurt a bit, doesn’t it?”

Yes, it's a business profile that reads like a movie. Read the story here right now.

Sign of Progress?

"At Harvard, informal debates are said to be breaking out in faculty lounges about whether professors should focus more on teaching students how to run businesses that are sustainable in the long term, rather than just pawning off the latest hedging techniques."

That's Bradford Plumer, writing in The New Republic, on business schools' growing feeling of responsibility for the financial crisis.

One Harvard professor confesses that business schools still need to begin a conversation about their broader purpose in the world—a question that involves pondering “the fundamental relationship between the economy and society.”

Read the full story here: First, Kill All the MBAs .

Wednesday, July 08, 2009

WANTED: Young, Fast-Growing Companies

If you run a young, fast-growing business, or you know someone who does, PROFIT Magazine WANTS YOU!

The deadline is coming up fast to submit candidates for the PROFIT HOT 50, the definitive list of Canada’s Emerging Growth Companies.

Now in its 10th year, the Hot 50 ranks companies by two-year revenue growth (year-end 2006 to year-end 2008). It's a cool list of the country's next generation of growth stars!

A PROFIT HOT 50 ranking can inspire your staff, attract new clients and investors, and spark relationships with other dynamic companies. HOT 50 companies receive:

* coverage in the October 2009 issue of PROFIT Magazine and online year-round at PROFITmagazine.ca;

* Plus, a complimentary invitation to GrowthCamp, an exclusive three-day summit at which PROFIT HOT 50 leaders share ideas, learn from experts and make valuable contacts.

Since I started this program, and GrwothCamp, I gotta tell you: people swear it's the most incredible business event they've ever attended.

If your firm was launched in 2005 or 2006, enter the PROFIT HOT 50 today! The entry deadline is July 10, 2009 (that'd be Friday).

For more information or to enter online, visit http://www.profitguide.com/awards.
Or call 1-800-713-GROW.

(Okay, one last story. In the mid-1990s, we had to fight hard at PROFIT to get one of the last good 1-800 numbers (713-GROW).The experience was so interesting that we even wrote a short article on the growing competition for cool toll-free numbers. At the time, few people realized there was a number shortage, and a growing secondary market.

Little did we know then that the smart money was already buying up Web addresses....
Sigh.)

Need help with your R&D projects?

My column this week in the Financial Post looks at a brave new resource for innovative businesses: a government-funded program that helps connect innovative companies with grad students interested in doing commercial R&D.

The program, MITACS’ Accelerate, is bridging the gap between Canada’s universities and its private-sector innovators. Last year the program created 600 placements, and this year it’s expected to arrange 1300 more!

Excerpt:
"The beauty of Accelerate is it's made for companies of any size, but priced for small businesses. A four-month internship costs companies $7,500 (federal and provincial governments chip in to match that amount, thus meeting Accelerate's fee of $15,000). For that price, a company gets help describing its project, links to the best sources of help, the services of a grad student for four months (including some expenses), and hands-on monitoring by a university professor."

For the full story, click here.

Wednesday, July 01, 2009

On Guard for Whom?

Happy Canada Day!

Kudos to Wellington Financial for identifying a worrying trend yesterday: a steep decline in bank lending.

In their blog post, Bank business lending down for 5th consecutive month, the Toronto-based supplier of bridge financing & venture debt dug into the latest Bank of Canada data and discovered that "the stats aren’t pretty."

Here are the totals of “Business loans to Canadian residents for business purposes:”

December 2008: $191.967 billion
January 2009: $186.086 billion
February 2009: $184.168 billion
March 2009: $184.5 billion
April 2009: $182.228 billion
May 2009: $180.619 billion

As Wellington points out, "A 5% drop in drawn business credit in the space of 5 months."

And as they ask, "what’s a $100 million line of credit program from the Business Development Bank of Canada (only for “strong balance sheets”) going to do in the face of a 5-month, $12 billion withdrawal from the system? By the time the program is up and running, loans will have been reduced by another few billion dollars."

As Wellington concludes, "The free market is doin’ its thing, and there is nothing anyone can do to stop it." Though that strikes me as a non-entreprneurial sentiment.