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Competitive Edge
Creating your Unique Value Proposition to gain your Competitive Edge.
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Here's What I Learned from Working with 50+ PR Firms

Here's What I Learned from Working with 50+ PR Firms | Competitive Edge | Scoop.it
First Round is a seed-stage venture firm focused on building a vibrant community of technology entrepreneurs and companies.
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Why I Look for Obsessive and Competitive Founders

Why I Look for Obsessive and Competitive Founders | Competitive Edge | Scoop.it
  Obsession. The drive to succeed at all costs. When second place isn't good enough because we live in winner-take-most markets. The desire to be better

This blog started from a series of conversations I found myself having over and over again with founders and eventually decided I should just start writing them.It would often make my colleagues laugh because they’d hear me like a broken record and then the next week read my ramblings in a post.

Last week’s obsession was about obsession itself.

10 days ago I saw the film, Whiplash, which is one of my favorite films of the year. I would be shocked if it doesn’t win at least one Oscar. I won’t have any spoiler alerts here, don’t worry.

The protagonist in the film, Andrew, is a drummer and the story is his experiences in his freshman year of one of the most elite music conservatories in the country. He wants to compete to be the lead drummer in the competitive ensemble and study under Terence, an obsessive instructor who is hell bent on winning competitions for the school.

I absolutely loved the film. I loved the music. I loved the intensity. I loved the drive to succeed, to compete and to be one’s best. As you can imagine – all great films have conflict and the tension is this – what is an acceptable level of obsession to put into success, whether instructor or student?

The rest you should see for yourself.

But the film has my brain buzzing all week about obsessive and competitive people. Think about Kobe Bryant. Kobe is famous for waking up crazy early every morning and practicing for longer and harder than nearly anybody else in the NBA. Kobe isn’t Kobe just because he was born naturally tall and athletic – although that is a sine qua non.

Kobe is kobe because he practices more than even the most elite professionals in a hyper competitive industry and because he is simply more dedicated to his success than many other people are.

In our society we revere athletes. We revere musicians. We glorify their successes and we marvel at their achievements.

Yet somehow many people think that startups intended to operate at massive, Internet scale can be casual affairs. I see founders who think they can be at every conference, advise multiple companies, do side investments in angel deals, leave the office at 6pm and have a balance life. I don’t believe it’s possible to compete at Internet scale and have balance.

I’m not making a qualitative statement that I believe obsession in startups is necessarily a good thing. In fact, I have written about the negative health consequences and sometimes mental consequences of doing so.

But I would make the observation that if you stumble on to a really important idea that has the potential to be really valuable know that others will enter into the market precisely because markets are competitive and a lot of money and prestige is at stake. In fact, think about it. Even MORE money is at stake than what Kobe or even the best rock bands in the world can make by being at the top of their game. Zuckerberg. Larry / Sergey. The founders of DropBox, Airbnb, Uber – you name it.

So if you’re going to raise venture capital and compete in large, growing, winner-take-most markets you had better be prepared for other people to want to knock you off your stool, steal your limelight, grab your customers and muck you up.

I don’t know Mark Zuckerberg. But I’m willing to bet (and certainly from the profiles I’ve read) that he was pretty obsessive and all in at Facebook for many years (if not still) to drive their success. It isn’t as if there weren’t other people trying to dethrone Facebook all along.

I write all this because I am constantly asked “what I am looking for when I make an investment” and the most honest answer I can give is that I’m looking for maniacally driven individuals who are obsessive in their pursuit of an idea and who are so competitive and driven that they can’t accept failure.

I know it sounds cliché.

But I would ask you this. If it takes compulsive individuals to be at the absolute peak in sports or music – why wouldn’t it take the same to create a disruptive product or service that can change an industry. It’s not a 9-to-5 job. It’s not for people with soft elbows or compressed egos.

I look for many things. I’ve even written about the Top 12 attributes of an entrepreneur here (each number is clickable).

But I’ve also got to be able to observe the inner Whiplash.



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Marc Kneepkens's insight:

Creating a startup, or even simply your 'own' business, does not come easy. This blog from a world renowned entrepreneur illustrates that very well.

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Success Will Never Come to Entrepreneurs Who Do These 10 Things

Success Will Never Come to Entrepreneurs Who Do These 10 Things | Competitive Edge | Scoop.it
There will always be winners and losers. Make sure you don't end up the latter.

Whether we are talking about a football game, an election or an entrepreneurial journey, one thing is certain -- there are going to be winners and there are going to be losers.

Want to stack the odds of being a successful entrepreneur in your favor? You can start by taking note of the following 10 things that you should never do.

1. Be jealous or envious

Seeing other people around you succeed should motivate you, even if they are your competitors. You should understand that every single person has the ability to become successful, and wasting time focusing on other people’s success or achievements will just sidetrack your own progress.

2. Look back

You are going to face hard times, difficult decisions and possibly even failure at some point. Don’t let small bumps in the road stop your forward progress. Find ways to maneuver around obstacles and continue to push forward, never looking back.

3. Make excuses

If you make a bad decision and screw up, own it. If something doesn’t work out as planned, don’t look for excuses. Search for the cause of the problem and chalk it up to a valuable business lesson. If you identify and own the problem you will not make the same mistake again. If you are constantly making excuses for your mistakes, you will continue to make them because you haven’t properly identified the root of the problem.

4. Stop learning

Your age, years of experience or level of success should never prevent you from learning. There isn’t a single person on this planet who knows everything. We can all continue to learn and be inspired from other entrepreneurs, whether they are billionaire household names or those just starting his or her entrepreneurial journey. 

5. Associate with negative individuals

People who constantly make excuses, complain and have a negative outlook should be avoided like the plague. We all know people like this. No matter what you say or what the situation is, they always chime in with negativity. People like this are a cancer and their negative aura can rub off on you. Surround yourself with like-minded individuals that are as focused and determined as you are.

6. Wake up without a plan

Time management is a crucial part of being an entrepreneur. There are only so many hours in a day, so to be efficient you need to know what your goals are and what tasks you need to get done prior to starting your day. If you are scrambling to create a plan of attack every day you are going to be in trouble. End each day by mapping out the following day’s to-do list.

7. Be scared to make changes and adapt

You need to be willing and able to adjust your plan and overall strategy, because there is a very good chance that you will need to adapt to maintain success in the future. Imagine if Apple never adapted and just stuck to making computers? After releasing the iPod it started manufacturing smartphones, tablets and now are releasing its first wearable technology, the Apple Watch. Once just a computer company, it is now a consumer-electronics powerhouse. 

8. Let your bark be bigger than your bite

Successful entrepreneurs don’t sit back and talk about what they are going to do. They plan, follow through and conquer. Nothing is going to get accomplished just by talking about it, and nobody is going to be impressed with words alone. 

9. Focus solely on dollar signs and decimal points

Instead of chasing the money, focus on creating products and services that make a difference and provide value. If you do this, the money will come. I would be lying if I said the goal of my company wasn’t to make money, but focusing on providing a great service paves the path for the money to follow.

10. Let failure stop you

Most statistics state that eight out of every 10 new businesses fail. Successful entrepreneurs go into everything knowing that there is a chance of failure. If in fact they fail it is viewed as part of their growth and they keep plugging along.

James Dyson is a perfect example, as his first 5,126 prototypes were failures, but the 5,127th one worked and went on to become the top-selling vacuum in the U.S. He is now worth $4.5 billion because he never once let failure stop him.

What are some others things that successful entrepreneurs should never do? Share your own in the comments section below.



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A Rigid Mind Blocks Success. Try These 5 Strategies for Fearless Leadership.

A Rigid Mind Blocks Success. Try These 5 Strategies for Fearless Leadership. | Competitive Edge | Scoop.it
Be ready to set aside methods of the past. Bring vigorous, flowing thinking to conquer today's problems.

Rigid thinking is natural to the human psyche. This rigidity causes people to repeatedly apply the same behaviors over and over to diverse business situations. The reality is that people are the most comfortable doing what they know orhave done in the past.

The challenge that arises is that diverse problems require varied responses, yet human beings are especially prone to doing what they're familiar with because it doesn’t awaken any fear.

Fear leads to rigid thinking and subsequently blocks abundance. This is how people get stuck in self-doubt, confusion and stress and their energy drains away as they dip into despondency and frustration.

These psychological states of mind are the reason many aspiring leaders quit. They cannot move past the fact that the approaches they think should work don’t. And so self-doubt and fear take over and the entrepreneurs feel blocked. Successful leaders wage war on these habituated patterns and this, in turn, leads to their success.

1. Breaking mental patterns.

Successful leaders fight against their habitual tendencies. They force themselves to react to what's happening in the present moment without going back and trying to apply past philosophies.

Great leaders know that in order to be successful they have to be hard-nosed ahd not letting their reactive emotional responses get in the way of a current business opportunity. They are adept at yanking themselves away from using the same tired methods, even when it involves risk and invokes fear. They are clear that everything they want exists on the other side of fear and so they jump.  

2. Creating shock. 

In moving away from rigid and safe decision-making responses, great leaders are aware that while they might sacrifice emotional comfort and security, they will gain the element of surprise.

Because they can be flexible in the present, they are unpredictable. This is powerful for leadership and success as their creating shock doesn’t allow customers, competitors and strategic partners to know what they will do next. This creates further interest and fascination with the entrepreneur and also generates awe and respect. Shock inspires people to pay close attention and want to follow.

3. Using mindfulness.

Successful leaders are clear that being elite in a field is not just about having knowledge.

When a deal is lost, the problem is often not because a person thought of a solution too late. Some individuals will ruminate, “If only I had had more knowledge.”

Successful leaders know this is an incorrect approach. What creates failure   is not being mindful of the present moment. Great leaders refrain from getting lost listening to their own thoughts, reacting to things that happened in the past and habitually applying prior concepts and ideas to the present, which might have little relevance to what the situation is calling for.

They are able to intuit and stay attuned to the demands of a current deal, letting them spontaneously figure out what needs to be accomplished (which may be entirely different from similar prior negotiations). 

4. Embracing the unexpected.

Accomplished leaders dispel the myth of preparation as being the greatest strategy for success. Top leaders know that no amount of thinking in advance can prepare them for the chaos of business or the infinite opportunities of today's deal.

The current negotiation is completely new and full of possibility -- which a fixed mind won't be able to see. The present moment is fresh and always brings uncertainty and great leaders know their minds have to keep up with change and adapt to elements that are unexpected.

In this way, knowledge, experience and theory have limitations and can be deterrents to seizing and keeping up with unexpected changes arisng from the present arrangement.5. Developing a flowing mind.

Successful leaders view the mind through the metaphor of a river. The faster the mind can flow, the better it keeps up with the present and responds to change. The faster it flows, the more it refreshes itself and the greater the momentum.

Fixated thoughts, past experiences (whether successes or failures) and rigid ideas act as boulders in this river, damming it up. When blocked, the river stops moving and stagnation sets in. For this reason, great leaders wage war on their mind so it's open to the flow and keeps up with the creativity of the present opportunity on the line.

To improve leadership skills and become an esteemed leader, a person must shed old traditions and misconceptions. Strategy does not involve learning a series of steps to follow like a recipe because success has no magic formula.

To lead effectively, people must learn to become their own strategists, based on intuition and relying on new and unused tactics. They have to take chances that may not at first seem to make sense.

The greatest leaders, the most creative tacticians stand out not because they have more knowledge but because they are able when necessary to drop their preconceived notions and focus intensely on the present moment and all it has to offer. That is how creativity is sparked and new possibilities in business are seized.


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7 Warning Signs Before Your Startup Fails

7 Warning Signs Before Your Startup Fails | Competitive Edge | Scoop.it
A startup can be seen as a series of trials and errors - some things work others do not. Here are some early warning signs that you might be in trouble.

Andrew Condurache is the founder of Closed Club, a startup that archives closed down startup products and key lessons learned

A startup can be seen as a series of trials and errors – some things work others do not, but you keep pushing on. Sometimes you think you are on the right path and everything is going smoothly… then out of nowhere, an unexpected obstacle stares you right in the eye. What do you do?

Below are some early warning signs that you might be in trouble.

1. Your sales cycles or customer acquisition time is getting longer

You may have launched an awesome product, received a lot of buzz and lots people signed up to your mailing list. However, you have noticed your acquisition rates are declining or are starting to take longer than previously.

2. You don’t really know your end user

You created something that you assumed people wanted, people told you they wanted it before you built it, you built it then people said “Cool, I will probably use this one day, good luck with it all!”

You are still trying to work out why a gush of users didn’t come flocking with open arms.

3. Your market is gradually shrinking

Being in a market that has declining demand rates is not a good idea if you want sustainable long term growth. If you have noticed demand decreasing and it’s nothing to do with your product, competitiveness or pricing strategy, it’s time to rethink the industry you’re in.

Declining demand is an early warning sign that you might need to consider diversifying into a new market or pivot away from the product or service you currently offer.

4. You don’t have time to focus on your core product

You understand the product is paramount to your success; however, unexpected things have popped up which means that resources and time are now getting allocated to something else.

When you deviate away from improving upon your core offering, i.e. your product or service, you might find yourself in trouble later on. Competitors might “come out of nowhere” with a better product offering while you were focusing on “more important things.”

5. You have no real plans for monetization

It’s okay if you don’t want to monetize your product immediately or in the near future, but experimenting with potential monetization options early on gives you insight into probable scenarios regarding how you could profit in the future.

Expecting to just flip a switch on when the “time comes” is slightly naive and you might find yourself with unexpected obstacles. Experimentation improves your learning curve and provides greater insight when you do decide to monetize if you have not already done so.

6. Price wars are coming your way

When you start feeling your competitors squeezing your last drip of margin real tight, you’re most likely experiencing a price war. This occurs for many reasons, one of which could be that you are in a commodity market, a market driven purely by price differentiation.

This could be okay if you are prepared to fight back with an ever declining pricing strategy. If you are not in that position, you might find yourself in trouble.

7. You are getting bored of it all

If you are finding that the excitement of running your business is wearing off and the thrill behind creating something of long term value is depreciating, then you’re more than likely in trouble. This is a very early sign of the potential demise of your business.

If you’re not passionate about your company anymore, it will show in your product and the way you manage your business.

Watching your startup decline is not easy, but as many entrepreneurs will tell you, failure teaches you to succeed. Don’t be discouraged if you find yourself in this position – you may just be experiencing a little serendipity and all might work out in the end.


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Warning signs to know about early and make adjustments or pivots.

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To Be Successful, Do Only What Matters

To Be Successful, Do Only What Matters | Competitive Edge | Scoop.it
Popular wisdom says your sphere of influence -- your communications and social network -- should be big. Popular wisdom is wrong.

Everyone is obsessed with the habits of the wealthy these days. The great irony is, if successful people concerned themselves with that sort of nonsense they never would have made it big in the first place. Truth is, none of that stuff matters. It’s all just a waste of time and focus.   

If you want to be successful, you have to learn what really makes a difference. What really matters. You need to do that and keep the distractions – everything that doesn’t matter – to a minimum. Now I’ll tell you what matters but I’ve got to warn you: it’s really simple. But then, all great lessons in life are simple.

What matters is what you do. How do you figure out what to do? Strangely enough, you figure out what to do by doing. By …

  • Getting out into the world, getting a job, experiencing and learning.
  • Figuring out how business works.
  • Learning what you like to do and what you’re good at – your strengths to leverage and weaknesses to overcome.
  • Gaining confidence from your successes and wisdom from your failures.
  • Meeting smart people, asking good questions and listening to what they have to say.
  • Figuring out what it takes to be a good employee and how to motivate and manage others.
  • Learning what works and what doesn’t work in the real world.
  • Putting yourself out there so you’re aware of opportunities and maybe even create your own luck.
  • Understanding that it’s all completely and entirely up to you – nobody else can do it for you and nobody is holding you back, either.
  • Having your priorities straight, the work ethic to always get the job done, and the discipline to focus on what matters and not on what doesn’t.

It always comes down to the same thing. Doing what matters. That’s exactly how world-class companies like GE and P&G breed hundreds, if not thousands, of entrepreneurs who found tomorrow’s startups and CEOs that turn good companies into great ones: on-the-job experience.

Now I’ll tell you what doesn’t matter. What doesn’t matter is what everyone else says and does. That’s right; none of it matters. Not a word. Of course, the exception is the people you come across in your real-world experience. If you get out in the world and do things, you will inevitably meet and learn from thousands of people. That’s 99 percent of the wisdom you’ll need. No kidding.  

Here’s another way to look at it. Let’s talk about spheres of influence. The popular wisdom of the day is that everyone should have these enormous spheres of communication and social networks, the bigger the better.

Popular wisdom is wrong and I’ll tell you why.

Social networking – tweeting, posting, linking, blogging, too – is what I call “one-to-many” communication. The level of interaction and quality of communication is lousy because a billion people are all doing the same thing so nobody has the bandwidth to read but a tiny fraction of what shows up in their stream.

That’s why the vast majority of online interaction is a complete waste of time. Everything you post just bounces around the Web and nothing ever really comes of it. Nothing that matters, anyway. It’s like throwing a bucket of water into the ocean. Sure, there’s more water in the ocean now, but so what?  

Also, whatever you learn online is visible to everyone so it provides no competitive advantage whatsoever.

The way to be successful is to keep your sphere of influence small and focused. How small and focused? That depends. Mark Zuckerberg and Bill Gates wrote code. Richard Branson sold records. Their spheres were relatively small and extremely focused in the early days of their careers while they were building their businesses. Then they grew in time. That’s usually how it works.

It basically comes down to this: You do want to broaden your sphere but you want to broaden it by doing what matters, not by wasting your time on what doesn’t matter.

Not only does reading about rich people’s habits not matter, the same is true of the vast majority of what you do online. And if they wasted their time with all that stuff, wealthy people would never have become wealthy to begin with. The only thing successful people do that matters is focus on doing what matters. Simple as that.


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How To Tell If You’re Burning Money Too Fast | TechCrunch

How To Tell If You’re Burning Money Too Fast  |  TechCrunch | Competitive Edge | Scoop.it

Editor’s Note: Joe Floyd is a venture investor at Emergence Capital. Emergence focuses on enterprise cloud applications and has invested in market leaders including Yammer, Box, Veeva Systems and Salesforce. 

Questions about cash burn have blazed through Twitter like wildfire. Entrepreneurs are asking us: How do I know if I am burning money too fast? Unfortunately, there is no one-size-fits-all answer for an entrepreneur on what level of burn is appropriate for their startup. However, every entrepreneur should consistently assess their runway and revise spending against their strategic goals.

I have designed this short quiz to help enterprise cloud startups analyze their spending levels. It’s critical to monitor your company’s burn rate so you can make those quick adjustments to increase your chances of success.

Select the answers below that best describe your company.

1. Market Dynamics: Does your market have network effects?

a) Each sale is independent. If we sell to one customer it does not impact the likelihood of sale to another customer.

b) Economies of scale are important in our market and we believe that only three or four solutions will achieve scale. Early movers have a small advantage.

c) Every new customer increases the value of our product and becomes a source of new potential customers. Early movers have a major advantage.

2. Competitive Intensity: Who are your major competitors?

a) We are in a dogfight with a number of well-funded startups and large incumbents. Our sales team consistently sees competition for new customers, and we win as often as we lose.

b) We are competing with one or two large, entrenched companies. Our sales organization sees competition more often than not, but we win most of the time.

c) We are carving up a green-field opportunity. We sometimes face competition for new business but it is usually from consultants or internal teams building custom solutions.

3. Customer Retention: What is our churn?

a) We estimate that we turnover 1 out of every 4 customers each year. We haven’t really started tracking churn yet, but I would guess that our net annual MRR churn is ~20 percent.

b) We track churn and we know we retain 85-90 percent of our customers annually. We have increased our average sales price by 10 percent over last year. We also have a customer success team that upsells our most engaged customers, so our net annual MRR churn is only 10 percent.

c) We track each cohort of customers on a monthly basis and our customer success team excels at deploying new customers quickly and getting them engaged. We have negative MRR churn, and each monthly cohort continues to grow over time.

4. Sales and Marketing Efficiency: What is the return on every dollar of sales and marketing spend?

a) We spend $1 – $1.5 in sales and marketing for every dollar of total bookings (new and renewal). We do not worry about gross margins because we know they will increase with scale. We collect some contracts monthly, quarterly and annually.

b) We achieve a 1:1 ratio of sales and marketing spend to new annual contract value (ACV) bookings. We analyze customer acquisition costs (CAC) by channel, and we tend to payback CAC with gross profit in 9 – 12 months. We try to get cash payment up front for annual contracts.

c) We consistently receive $2+ dollars of new ACV bookings for every dollar of sales and marketing spend. We optimize CAC by allocating marginal spend to the highest performing channels. Gross profit pays back CAC in less than 6 months consistently. Our customer success team is deploying signed contracts quickly, and we always collect cash up front for our contracts.

5. Fundraising Capability: Who is in your investor syndicate and how easily can you add new sources of capital if you need to fundraise quickly?

a) We have a group of angel investors or constrained institutional investors. It feels too early to pursue debt. We are heads down focused on sales and product right now and we will think about the next fundraising when we need to raise more money.

b) We have one institutional lead investor with dry powder, and we think we can secure a small debt facility. Our investor can introduce us to venture firms so we can start a fundraising process pretty quickly if we need to do that.

c) We have two or more institutional venture investors and we have a small debt facility with our bank that we can draw down if we need it. We keep a steady dialog going with investors that we would like to involve in future financings so we could start a process tomorrow if desired.

What’s your score?

Give yourself one point for each “A” answer, three points for each “B” answer, and five points for each “C” answer.

0-10 points: Pull the ripcord. You need to evaluate your spending immediately and consider pulling back drastically. You may be too early in a nascent market, and it would be wise to conserve capital until the market develops. You may be facing too many competitors which is forcing everyone to spend inefficiently. You may want to scale back sales and marketing while you pivot your product to find a more attractive competitive position. Lastly, you may not be able to raise additional equity if the current venture environment sours. You should look to secure a debt facility and reduce burn to give your team the longest possible runway to succeed.

11-18 points: Pump the brakes. You are not in trouble yet, but you should quickly assess your situation. If you are targeting a large enough market, then you may be justified in continuing to spend on sales and marketing even if you are not that capital efficient. However, you should drill down and figure out why you are not efficient.

Do you have a churn problem? Do you face too much competition? Do you have too many sales reps? Not enough good sales reps? Are you marketing in the right channels? Is your pricing right? Is your product truly solving a customer pain point? Once you understand the drivers of your current business, you can reduce spend in the areas that are not efficient.

For example, if you do not quite have product-market fit, then you can reduce sales. If you do not have sales functioning perfectly, you can reduce marketing spend. Lastly, you should consider raising a top up round to give yourself 18 months of runway while the venture fundraising window is open or securing a debt facility to give yourself an extra 6-9 months of cushion.

19-25 points: Burn baby burn. Your sales and marketing engine is firing on all cylinders and you have proven you know how to engage customers and keep them renewing. Now is the time to pour fuel on the fire to attack your market while there is little competition. The viral effects are strong enough to justify the investment now, and investors will reward you for your efficient growth. Remember to keep monitoring your SaaS metrics so you can adjust your spend if your business slows down. Lastly, you should consider raising additional growth equity early while the venture window is wide open and valuations are aggressive.


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Here is the response to the latest issue for startups: burn rate! This article includes a great survey.

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Is Your Product Roadmap Just Burning Your Money? - Enterprise Irregulars

Is Your Product Roadmap Just Burning Your Money? - Enterprise Irregulars | Competitive Edge | Scoop.it

The number 1 mistake I have seen companies of all sizes make is to let the customers, sales people, engineers and tactical product managers decide the product roadmap by adding one feature after another.

If you have product market fit and are doing more than a few million dollars in ARR (annual run rate), you don’t need new features to sell your product. If your product is good enough for a few customers with little marketing then it is reasonable to expect that there are many more customers for whom the product is good enough.

Your sales people will complain when they lose to a competitor because of feature X but will likely not be ready to commit to a bigger quota. This is a tell tale sign that this is not a true gap.

Given my experience with 10+ startups and at Salesforce.com, here is my key learning: most product roadmaps do very little to move the needle on growth.

Ask the Hard Question: What if we did no new features for a year?

The way to tease out what is truly strategic and important is to start by framing the problem differently. Think of it as zero based budgeting. – you don’t assume that you keep doing the old stuff, you question everything.

I usually ask the management team – CEO, VP of product, VP of sales – to individually assess the change in top line revenue 1, 2 and 3 years out if we stopped building all the new features except bug fixes and just plugging gaping big holes.

The answer is usually shocking – most startups (and big companies) spend most of the R&D budget building features that are unlikely to move the needle.

What would you build to increase revenue 24 months from now?

There is very little that a product can do to truly change the revenue trajectory for a post product-market fit company in the short term. But if you invest in the right areas, it should impact your longer term roadmap. For example, HubSpot adding CRM to its feature set is definitely going to impact its TAM (total addressable market) unlike adding lots of bells and whistles to email marketing. Workday needs to build all the HCM features out but real top line growth from R&D comes from building Financials or Supply Chain products.

Great companies and great product leaders are naturally good at this. They intuitively understand what the market wants and deliver it.

We all intuitively know this for companies that ship hardware. Everyone is asking for the next iPad, the next iPhone – not just a slightly better Macbook. Its important to finish what you started – and there is whole blog post on this – but its important to know that the two buckets are different.

You will never build an iPhone by incrementally improving your Macbook. 

Similarly, a software company that keeps adding features to its one product without thinking in terms of new editions, new product lines or new go to market – will end up with a bloated product not a richer set of products that can alter the future of the company.

I leave you with this thought – what features are you building today that will truly significantly change the your future? Are you building the next iPhoneor are you just adding the 10th button and the 7th app on a Blackberry?


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5 Ways To Build An Accidental Business Into An Empire

5 Ways To Build An Accidental Business Into An Empire | Competitive Edge | Scoop.it
Down and out in Beverly Hills, Meridith Baer parlayed her passion into a blockbuster business.

Baer shared with me five ways she has grown her business into a $25 million empire.

1. Do what you love
Baer had always loved fixing up her home, and doing what you love is one of the reasons American women entrepreneurs are among the happiest people in the world.  Now Baer could do this for others and get paid for doing it. What could be better?

Staging had another significant advantage for Baer. As a screenwriter, you work on a project for years. Someone finally buys your script then changes your vision for it and, worse, has someone else do the rewrites.

In staging, you complete your vision in a few days and get immediate feedback. Better still is when the home sells quickly—on average a staged property sells 80% faster and for 20% more than a non-staged one. Talk about instant gratification!

2. Dream big
In 2004, Baer hired her nephew Brett, who had an M.B.A.  At first his plans for growth terrified her—now, she’s pushing him. The business doubled from last year and is projected to generate $25 million in revenue in 2014. Meridith Baer Home employs approximately 140 people.

Meridith Baer Home’s clients include more than 300 billionaires and celebrities, including Christina Aguilera, Gwyneth Paltrow, Harrison Ford, Matthew Perry and Brad Pitt. Staged to Perfection, a TV series that aired in the U.S., followed her and her team of 18 designers as they transformed homes that were stalling on the market into the stuff real estate brokers dream of selling.

3. Expand your product lines
Baer works for the rich and famous. When Robert De Niro does a movie in Los Angeles, the studio rents him a home and Meridith Baer Home decorates with leased furniture. In fact, renting furniture has become its most profitable line of business.

Some clients purchase some or all of the furniture used in a staged home, which is common for wealthy, divorced men who are setting up house for themselves and their children. Others want Baer’s team to decorate the home they just purchased even when the company hadn’t staged it. Upscale developers also use Meridith Baer Home to decorate models.

While the demand was clearly there, Baer had a problem. She and her team couldn’t always find the furniture they wanted. Meridith Baer Home now manufactures furniture in China, Mexico and the U.S.

Meridith Baer Home has expanded geographically to Manhattan, the Hamptons and Connecticut. Atlanta, Washington, D.C., Florida, and San Francisco are on the horizon.

4. Learn to speak finance
Baer tried to get financing several times, then gave up. She didn’t know how to explain that she was reinvesting all of her profit into growing her business and therefore couldn’t show a favorable bottom line. Then she hired a Stanford MBA as CFO. On his first day, he was able to get the company a $3 million line of credit at a very low interest rate. Now banks are fighting to get her business.

Meridith Baer Home also spends about a half-million dollars on a corporate charge card per month, which she pays off at the end of the month. The benefits: Baer doesn’t have to pay interest on it for 30 days and earns an avalanche of miles, which she both uses and gifts to family members.

5. Don’t forget to protect yourself
In the beginning, Baer learned the hard way. Her second client, some hot-shot from the music industry, tried not to pay—he claimed selling his home was an opportunity for her to learn the business.

When Baer went to his home to remove her furniture, he had changed the locks. His broker and her attorney warned Baer not to mess with him. Little did she know that her attorney was sleeping with the music man! Baer would not be bullied, going back with her team to remove the furniture. She stood up for herself and got paid.

In another instance, one of Baer’s first hires tried stealing clients. Instead of handing out Meridith Baer Home cards, she handed out her own. Never wanting to repeat these mistakes, Baer now relies on contracts which, she says, “ really do hold up in court.”

How will you apply these lessons learned to your business?


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Via Deb Bailey, malek
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You Should Run Your Startup Like a Cult. Here's How - Wired

You Should Run Your Startup Like a Cult. Here's How - Wired | Competitive Edge | Scoop.it

No company has a culture; every company is a culture. A startup is a team of people on a mission, and a good culture is just what that looks like on the inside. The first team that I built has become known in Silicon Valley as the “PayPal Mafia” because so many of my former colleagues, including Elon Musk, Reid Hoffman, and David Sacks, have gone on to help each other start and invest in successful tech companies.


We didn’t assemble a mafia by sorting through résumés and simply hiring the most talented people. I had seen the mixed results of that approach when I worked at a New York law firm. The relationships between lawyers I worked with were oddly thin. They spent all day together, but few of them seemed to have much to say to each other outside the office.

Why work with a group of people who don’t even like each other? Taking a merely professional view of the workplace, in which free agents check in and out on a transactional basis, is worse than cold: It’s not even rational. Since time is your most valuable asset, it’s odd to spend it working with people who don’t envision any long‑term future together.


Rule 1: The Best Startups Work a Lot Like Cults

In the most intense kind of organization, members abandon the outside world and hang out only with other members. We have a word for such organizations: cults. Cultures of total dedication look crazy from the outside. But entrepreneurs should take cultures of extreme dedication seriously.

The extreme opposite of a cult is a consulting firm like Accenture: not only does it lack a distinctive mission, but individual consultants are regularly dropping in and out of companies to which they have no long‑term connection whatsoever.

Every company culture can be plotted on a linear spectrum:

The best startups might be considered slightly less extreme kinds of cults. The biggest difference is that cults tend to be fanatically wrong about something important. People at a successful startup are fanatically right about something those outside it have missed.


Rule 2: Giving People a Chance to “Change the World” Is a Lousy Way to Recruit Employees

Recruiting is a core competency for any company. It should never be outsourced. Talented people don’t need to work for you; they have plenty of options. You should ask yourself: Why would someone join your company as its 20th engineer when she could go work at Google for more money and more prestige?

Here are some bad answers: “Your stock options will be worth more here than elsewhere.” “You’ll get to work with the smartest people in the world.” “You can help solve the world’s most challenging problems.” Every company makes these same claims, so they won’t help you stand out.

You’ll attract the employees you need if you can explain why your mission is compelling: not why it’s important in general, but why you’re doing something important that no one else is going to get done. However, even a great mission is not enough. The best recruit will also wonder: “Are these the kind of people I want to work with?” You should be able to explain why your company is a unique match for him personally. And if you can’t do that, he’s probably not the right match.


Rule 3: Everyone at Your Startup Should Have Just One Job

Internal peace is what enables a startup to survive at all. But most fights inside a company happen when colleagues compete for the same responsibilities. Startups face an especially high risk of this since job roles are fluid at the early stages.

The best thing I did as a manager at PayPal was to make every person in the company responsible for doing just one thing. I had started doing this just to simplify the task of managing people. But then I noticed a deeper result: Defining roles reduced conflict. Eliminating competition makes it easier for everyone to build the kinds of long‑term relationships that transcend mere professionalism.


Rule 4: Hire Employees Who Are Excited to Wear Your Logo on Their Hoodies

Startups have limited resources and small teams. They must work quickly and efficiently in order to survive, and that’s easier to do when everyone shares an understanding of the world.

It’s a cliché that tech workers don’t care about what they wear, but if you look closely at the T‑shirts people in Mountain View and Palo Alto wear to work, you’ll see the logos of their companies—and tech workers care about those very much. The startup uniform encapsulates a simple but essential principle: Everyone at your company should be different in the same way—a tribe of like‑minded people fiercely devoted to the company’s mission.

Above all, don’t fight the perk war. Anybody who would be powerfully swayed by free laundry pickup or pet day care would be a bad addition to your team. Just cover the basics and then promise what no others can: the opportunity to do irreplaceable work on a unique problem alongside great people.

Excerpted with permission from ZERO TO ONE: Notes on Startups, or How to Build the Future by Peter Thiel with Blake Masters. Copyright 2014 by Peter Thiel. Published by Crown Business, an imprint of the Crown Publishing Group, a division of Random House LLC, a Penguin Random House Company.


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Via Raj Nadar
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Another great article from Peter Thiel. How do you run your startup. Does everyone believe in what you're doing, or is it just a job?

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4 Things Entrepreneurs Should Think About That May Not Be in Their Business Plan

4 Things Entrepreneurs Should Think About That May Not Be in Their Business Plan | Competitive Edge | Scoop.it
Two young women recount the lessons they learned from starting their social media-marketing agency.

Walking away from the comfy confines of the corporate world to start our own business was not only scary but we also encountered considerable skepticism from family and friends. What about job security, room for advancement, a 401(k) and insurance, they asked. Some wrote us off as simply two naive, young women. Others thought we were crazy to walk away from everything our burgeoning corporate careers appeared to offer for a situation in which success was far from guaranteed. 

We weren’t just making this decision on a wing and a prayer, though. We had identified a tremendous potential opportunity. Having recently helped several entrepreneurial friends market their new businesses, we recognized the positive impact that social media offered for brand awareness, reputation management and lead generation. We learned how to successfully target large numbers of business prospects in a cost-effective way. Once we were able to begin quantifying results and demonstrating a return on investment, we launched our own social-media-marketing agency.


We carefully constructed a comprehensive plan of our strategy for capitalizing on this opportunity. We had a mission statement and planned how much money we personally needed to invest to get the company running and cash to set aside for lean times. 

We projected how many clients we needed to sign and what to charge. We identified our target industries and our competitive advantage  over other agencies. 

With dollar signs and dreams of autonomy dancing through our heads, we ceremoniously offered our resignations the same day.  

Yet we quickly learned how much we hadn’t accounted for.  

There was way more to worry about and address than we had ever envisioned. Panic quickly began to set in. Perhaps the naysayers were right and we were in over our heads. Maybe we were, in fact, just two naive young women who had foolishly given up their corporate careers. Was it too late to call American Express and beg for our jobs back? 

We are happy to share that we never did make those calls. As bleak as things seemed, we somehow found ways to weather the storm and our company survived. Four years and seven additional employees later, the company continues to grow. 

Ye it took more hard work, sweat and tears than we ever imagined. This is where our pain becomes your gain: We want to help those about to dive into the entrepreneurial pool by sharing four items that are critically important to consider.


1. Find a good lawyer.

Shortly after launching, we received a cease and desist letter concerning the use of our company's  name. We were unsure about the ramifications and what would be needed to rectify it. If not for a competent business attorney with experience representing companies similar to ours, we could have lost more than just time and money.

Partnering with a trustworthy attorney who is knowledgeable and savvy in helping entrepreneurs is pivotal. Establishing the right relationship is key, as the right or wrong advice can make or break your firm. Take your time, perform due diligence and don’t simply go with the cheapest option. 


2. Work with a knowledgeable accountant.

Being so new to running a business, we did not know how much we actually did not know. Very early on we were introduced to an accountant who seemed smart, professional and pleasant. A big draw for us was that his rates were also very affordable. Everything was running smoothly. But as tax season hit, disaster struck. He did not sufficiently prepare us for how much money we were responsible for in taxes. Since we had a small cash-strapped business, the tax bill had the potential to cripple our firm.

Upset and seeking a second opinion, we were put in touch with a veteran certified public accountant who specializes in helping startups. Not only did he help us lay out a plan (which allowed us to meet year-end tax obligations), he pointed out several other items on our return where we had been missing out on an opportunity to save.

He also demonstrated how closely he works with clients throughout the year to help them manage and improve cash flow, all while setting realistic expectations and preparing them for the tax season. While it was a humbling experience, we learned the value of having a strong CPA. The right one isn’t just your accountant: He or she can be a partner to and an extension of your business. So do your homework.


3. Hire people better than you.

Early on, we were challenged in trying to attract great talent to build out our team. In addition to having a brand new agency with no proven track record and a tiny roster of clients, we were unable to offer salaries competitive enough to procure experienced individuals from other firms.  

We felt that if we were lucky enough to find someone pleasant, professional and competent who was willing to take a chance with our firm, we should hire that person.  

Once we got some people on board, we quickly learned how some individuals were not as experienced or hungry as they had advertised. Their work was OK but it was simply the bare minimum of what was required. We needed a certain level of quality to help differentiate our firm and attract other businesses to work with us.

We were now stuck with these staffers until we could find better support. This illustrates the importance of thoroughly scrutinizing and vetting candidates. This became our first lesson in the importance of being patient during the hiring process, regardless of the need for help.

Hiring the right person can take your business to new heights. Conversely, hiring the wrong person can quickly drag down a business. You can never be too careful when analyzing a potential hire. If you aim to hire people whom you perceive to be as talented and driven as you (or even more so), it will pay off.


4. Prepare to always be networking.

The biggest culture shock during our transition from corporate employees to business owners was the demands on our time. There were so many logistical and operational challenges peripheral to our brand’s mission that took our attention. But if we were busy dealing with lawyers and accountants, while interviewing, hiring and training support staff, how could we generate awareness of our brand and uncover new clients?

This is when we discovered the power of professional networking. As we accepted the reality that our professional lives no longer took place just between 9 and 5, we learned there were opportunities to attack all at once several areas involved in running a small business.

We were delighted to discover the wealth of events, trade shows and networking groups designed to connect us with professionals who could help our business from top to bottom. Most important, they put us in direct contact with the types of organizations we hoped to target. The connections we made at these events were invaluable. It also demonstrated to us that the work we did during the day was only half the battle.

If we weren’t personally out there spreading awareness of our brand and making strategic business connections, then no one else would do so for us. We were hunters now and would be able to eat only what we could kill. Therefore, we needed to always be prepared to network and connect with anyone and everyone we met.

Remember, your next client, deal or referral partner can come from striking up a simple conversation while waiting in line at a store or standing on the subway. Be prepared to introduce yourself, talk about your business and share your elevator pitch.

In addition, be sure to identify all events and opportunities that will allow you to connect with the right audiences. Fill your calendar. You are your brand’s best publicist.


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Marc Kneepkens's insight:

Yes, a business plan is necessary, but there are a few more requirements that you will need in your business.

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Eight Things I Learned from Peter Thiel’s Zero To One | Farnam Street

Eight Things I Learned from Peter Thiel’s Zero To One | Farnam Street | Competitive Edge | Scoop.it
"Rivalry causes us to overemphasize old opportunities and slavishly copy what has worked in the past."

“The most contrarian thing of all is not to oppose the crowd but to think for yourself.

Peter Thiel is an entrepreneur and investor. He co-founded PayPal and Palantir. He also made the first outside investment in Facebook and was an early investor in companies like SpaceX and LinkedIn. And now he’s written a book, Zero to One: Notes on Startups, or How to Build the Future, with the goal of helping us “see beyond the tracks laid down” to the “broader future that there is to create.”

The book is an exercise in thinking. It’s about questioning and rethinking received wisdom in order to create the future.

Here are eight lessons I took away from the book.

1. Like Heraclitus, who said that you can only step into the same river once, Thiel believes that each moment in business happens only once.

The next Bill Gates will not build an operating system. The next Larry Page or Sergey Brin won’t make a search engine. And the next Mark Zuckerberg won’t create a social network. If you are copying these guys, you aren’t learning from them.

Of course, it’s easier to copy a model than to make something new. Doing what we already know how to do takes the world from 1 to n, adding more of something familiar. But every time we create something new, we go from 0 to 1. The act of creation is singular, as is the moment of creation, and the result is something fresh and strange.

2. There is no formula for innovation.

The paradox of teaching entrepreneurship is that such a formula (for innovation) cannot exist; because every innovation is new and unique, no authority can prescribe in concrete terms how to be more innovative. Indeed, the single most powerful pattern I have noticed is that successful people find value in unexpected places, and they do this by thinking about business from first principles instead of formulas.

3. The best interview question you can ask.

Whenever I interview someone for a job, I like to ask this question: “What important truth do very few people agree with you on?”

This is a question that sounds easy because it’s straightforward. Actually, it’s very hard to answer. It’s intellectually difficult because the knowledge that everyone is taught in school is by definition agreed upon. And it’s psychologically difficult because anyone trying to answer must say something she knows to be unpopular. Brilliant thinking is rare, but courage is in even shorter supply than genius.

Most commonly, I hear answers like the following:

“Our educational system is broken and urgently needs to be fixed.”

“America is exceptional.”

“There is no God.”

These are bad answers. The first and the second statements might be true, but many people already agree with them. The third statement simply takes one side in a familiar debate. A good answer takes the following form: “Most people believe in x, but the truth is the opposite of x.”

What does this have to do with the future?

In the monst minimal sense, the future is simply the set of all moments yet to come. But what makes the future distinctive and important isn’t that it hasn’t happened yet, but rather that it will be a time when the world looks different from today. … Most answers to the contrarian questions are different ways of seeing the present; good answers are as close as we can come to looking into the future.

4. A new company’s most important strength

Properly defined, a startup is the largest group of people you can convince of a plan to build a different future. A new company’s most important strength is new thinking: even more important than nimbleness, small size affords space to think.

5. The first step to thinking clearly

Our contrarian question – What important truth do very few people agree with you on? — is difficult to answer directly. It may be easier to start with a preliminary: what does everybody agree on?”

“Madness is rare in individuals
—but in groups, parties, nations and ages it is the rule.”
— Nietzche (before he went mad)

If you can identify a delusional popular belief, you can find what lies hidden behind it: the contrarian truth.

[…]

Conventional beliefs only ever come to appear arbitrary and wrong in retrospect; whenever one collapses we call the old belief a bubble, but the distortions caused by bubbles don’t disappear when they pop. The internet bubble of the ‘90s was the biggest of the last two decades, and the lessons learned afterward define and distort almost all thinking about technology today. The first step to thinking clearly is to question what we think we know about the past.

Here is an example Thiel gives to help illuminate this idea.

The entrepreneurs who stuck with Silicon Valley learned four big lessons from the dot-com crash that still guide business thinking today:

1. Make incremental advances — “Grand visions inflated the bubble, so they should not be indulged. Anyone who claims to be able to do something great is suspect, and anyone who wants to change the world should be more humble. Small, incremental steps are the only safe path forward.”

2. Stay lean and flexible — “All companies must be lean, which is code for unplanned. You should not know what your business will do; planning is arrogant and inflexible. Instead you should try things out, iterate, and treat entrepreneurship as agnostic experimentation.”

3. Improve on the competition — “Don’t try to create a new market prematurely. The only way to know that you have a real business is to start with an already existing customer, so you should build your company by improving on recognizable products already offered by successful competitors.”

4. Focus on product, not sales — “If your product requires advertising or salespeople to sell it, it’s not good enough: technology is primarily about product development, not distribution. Bubble-era advertising was obviously wasteful, so the only sustainable growth is viral growth.”

These lessons have become dogma in the startup world; those who would ignore them are presumed to invite the justified doom visited upon technology in the great crash of 2000. And yet the opposite principles are probably more correct.

1. It is better to risk boldness than triviality.
2. A bad plan is better than no plan.
3. Competitive markets destroy profits.
4. Sales matters just as much as product.”

To build the future we need to challenge the dogmas that shape our view of the past. That doesn’t mean the opposite of what is believed is necessarily true, it means that you need to rethink what is and is not true and determine how that shapes how we see the world today. As Thiel says, “The most contrarian thing of all is not to oppose the crowd but to think for yourself.

6. Progress comes from monopoly, not competition.

The problem with a competitive business goes beyond lack of profits. Imagine you’re running one of those restaurants in Mountain View. You’re not that different from dozens of your competitors, so you’ve got to fight hard to survive. If you offer affordable food with low margins, you can probably pay employees only minimum wage. And you’ll need to squeeze out every efficiency: That is why small restaurants put Grandma to work at the register and make the kids wash dishes in the back.

A monopoly like Google is different. Since it doesn’t have to worry about competing with anyone, it has wider latitude to care about its workers, its products and its impact on the wider world. Google’s motto—”Don’t be evil”—is in part a branding ploy, but it is also characteristic of a kind of business that is successful enough to take ethics seriously without jeopardizing its own existence. In business, money is either an important thing or it is everything. Monopolists can afford to think about things other than making money; non-monopolists can’t. In perfect competition, a business is so focused on today’s margins that it can’t possibly plan for a long-term future. Only one thing can allow a business to transcend the daily brute struggle for survival: monopoly profits.

So a monopoly is good for everyone on the inside, but what about everyone on the outside? Do outsize profits come at the expense of the rest of society? Actually, yes: Profits come out of customers’ wallets, and monopolies deserve their bad reputation—but only in a world where nothing changes.

In a static world, a monopolist is just a rent collector. If you corner the market for something, you can jack up the price; others will have no choice but to buy from you. Think of the famous board game: Deeds are shuffled around from player to player, but the board never changes. There is no way to win by inventing a better kind of real-estate development. The relative values of the properties are fixed for all time, so all you can do is try to buy them up.

But the world we live in is dynamic: We can invent new and better things. Creative monopolists give customers more choices by adding entirely new categories of abundance to the world. Creative monopolies aren’t just good for the rest of society; they’re powerful engines for making it better.

7. Rivalry causes us to overemphasize old opportunities and slavishly copy what has worked in the past.

Marx and Shakespeare provide two models that we can use to understand almost every kind of conflict.

According to Marx, people fight because they are different. The proletariat fights the bourgeoisie because they have completely different ideas and goals (generated, for Marx, by their very different material circumstances). The greater the difference, the greater the conflict.

To Shakespeare, by contrast, all combatants look more or less alike. It’s not at all clear why they should be fighting since they have nothing to fight about. Consider the opening to Romeo and Juliet: “Two households, both alike in dignity.” The two houses are alike, yet they hate each other. They grow even more similar as the feud escalates. Eventually, they lose sight of why they started fighting in the first place.”

In the world of business, at least, Shakespeare proves the superior guide. Inside a firm, people become obsessed with their competitors for career advancement. Then the firms themselves become obsessed with their competitors in the marketplace. Amid all the human drama, people lose sight of what matters and focus on their rivals instead.

[…]

Rivalry causes us to overemphasize old opportunities and slavishly copy what has worked in the past.

8. Last can be first

You’ve probably heard about “first mover advantage”: if you’re the first entrant into a market, you can capture significant market share while competitors scramble to get started. That can work, but moving first is a tactic, not a goal. What really matters is generating cash flows in the future, so being the first mover doesn’t do you any good if someone else comes along and unseats you. It’s much better to be the last mover – that is, to make the last great development in a specific market and enjoy years or even decades of monopoly profits.

Grandmaster José Raúl Capablanca put it well: to succeed, “you must study the endgame before everything else.”

Zero to One is full of counterintuitive insights that will help your thinking and ignite possibility.


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Thiel really thinks it through. It's philosophy in business, and original thinking as an ultimate way to live and do business.

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6 Things I Wish Somebody Had Told Me When I Started My Small Business

6 Things I Wish Somebody Had Told Me When I Started My Small Business | Competitive Edge | Scoop.it
Nothing is more overrated than learning things the hard way.


I co-founded my business NutraBella, Inc. in 2005 after hearing my pregnant friends complain about their horse-pill sized pre-natal vitamins. We dreamed of giving women better vitamin options with Bellybar.

Fast forward to today where I spend my days on the QuickBooks team working to make small business management easier and more fun.  As I hear from small businesses owners from all walks of life, I am constantly reminded of the things I wish I had known. Owning a small business is a challenge, but here are six tips that will make the road to success easier.

1. Follow your passion and don’t let go. Your business probably stems from something you’re passionate about, but over time, the day-to-day running of the business makes it hard to keep that passion alive.

Fuel it daily by reminding yourself why you started your business. Make sure that you fall in love with a problem, not a solution. If your first solution doesn’t work, fall back on your passion for solving that problem to find another answer for your customer.

2. Cash is king. Running a business is an art and a science. The art is your passion. The science is your business model. Make sure you understand your own business model. It’s not something to abdicate to someone else. Understanding money-in, money-out, is critical to business success. Ignorance is not bliss. If you know how your business is doing at every moment, you can celebrate your success or plan for how to get more cash.

3. Hire smart. Hiring a team is thrilling but also scary. Take time to hire the right people for the right job. Fire them quickly if it doesn’t go well. As a small business owner, you can do anything but you can’t do everything! Hire people who love to do what you hate to do so you can focus on your dream and evangelize your passion.

4. Communicate with partners. Partners can be a great way to bring complementary talent to grow your business but, just like a marriage, it’s critical to communicate values and expectations. Create a business “pre-nup” to set expectations for the partnership.

Like every good marriage, go on date nights and remind yourself why you went into business together in the first place. You can also use it as an opportunity to brainstorm new ideas or talk through problems in a less stressful space.

5. Protect yourself from the unexpected. Think about roadblocks you might hit along the way. Expect the best but prepare for those unexpected hiccups.

Things will happen that you can’t control. Do what you can to protect yourself. Set up systems and processes in your business so that you can take a vacation or care for a sick child. Make sure that things won’t fall apart if you step away for a moment. Respect yourself enough to ensure that you can take care of yourself outside of your business.

6. The buck stops with you, but… You don’t have to be alone! As a small business owner, it can be lonely making all of the decisions. Ask for help. Not everyone has the courage to start a business but most people want to help and support you.

Find other entrepreneurs to learn from. Someone a few years ahead of you can provide invaluable advice. Someone just starting can bring energy and creative ideas. The best advice I ever received came from other entrepreneurs. It takes a village.

Running your own business is one of the most exciting, and challenging, adventures you will embark upon. Take care of yourself as you set the tone and culture of your growing business. Protect yourself to ensure the business will survive the ups and downs. Running your business can be fun with a little bit of planning and with processes to make things run smoothly. Take time to set it up right so you can get back to doing what you love. I’m cheering for you!



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What a letter from 1855 can teach us about startups today

What a letter from 1855 can teach us about startups today | Competitive Edge | Scoop.it

In 1855, Daniel McCallum wrote a letter to his bosses at the New York & Erie Railroad. McCallum had risen up through the ranks from carpenter, to bridge engineer, to chief of bridges, to regional manager of the Susquehanna division of the railroad. His latest promotion, to general manager of the entire railroad, was a big one.

So he picked up his pen and put his ideas about managing the railroad down on paper. It was the first time we know of that anyone ever did this.

McCallum’s biggest problem was cost-per-mile. As fast as the railroad grew in size, operating costs grew faster. Where the company should have seen productivity improvement (declining cost per mile), it saw the opposite. Communication, coordination, operations, sales — all became more difficult, not less so, as the railroad grew.

For McCallum, a productivity problem was a general management problem. And his ideas about general management marked a turning point in business history.

Fast forward not quite two centuries and many talented people in Silicon Valley are in McCallum’s shoes. They’ve risen rapidly in their careers because they were great at their jobs, because the company was growing like crazy, or both. They are getting shoved into leadership and management roles. And it is the hardest transition many of them have ever faced.

Against all their hopes and dreams, the bigger the company gets, the less well things work. Instead of productivity and happiness, there’s the opposite. These companies often have plenty of financial runway. And they have raw talent that’s the envy of the world. But they grind the gears on general management — burning too much cash, energy, and time setting goals, organizing the work, getting it done, and improving performance. The gears grind, people get frustrated, and the runway gets a lot shorter.

McCallum was at the height of his career, still prototyping how to manage. Remember, there were no business schools or how-to books in 1855. No general manager apprenticeships. McCallum had been taught to engineer and build bridges, not to manage thousands of people across half a continent.

McCallum’s letter outlined five key challenges:

  • How do you get a group of people to work together to common goals?
  • How do you give people the right amount of responsibility?
  • How do you make sure the job gets done?
  • How do you know how things are going?
  • How do you do all this with respect for others?

McCallum designed his railroad’s management structure and operation to answer those questions. He created a custom blend of hard assets, people and technology — for instance, he used the telegraph the way we use email or the internet today — to make the railroad work.

I believe that McCallum added years to the life of the New York & Erie railroad. The railroad had financial capital. It had engines, rail cars, all the physical assets it needed. It had fleets of talented people at every level of the organization. What the railroad needed was great general management to amplify the productivity of the capital + labor combination, to extend the life of the business. Great general management adds runway.

OK so what do we do with this story? Daniel McCallum. Interesting person. Hard problem. Railroads matter.

McCallum accidentally gave us a beautiful scorecard for general managers.

Take a look. Here are McCallum’s five challenges:

  • Group works together on common goals.
  • People have the right amount of responsibility.
  • Team gets the job done.
  • General Manager knows how things are going along the way.
  • People feel respected.

By each, write a score for your team from 1 to 10, with 1 being the worst and 10 being the best.

McCallum’s scorecard is an optimistic one. It’s based on the idea that sometimes you can get better in each of the five areas. So don’t be shy about giving a low score.

Now go back and spend time dissecting the low scores. McCallum took his lowest scoring areas and prototyped improvements. He changed procedures for communication. He changed the organization design. He added some steps and removed others in key process. You can do the same thing.

If you are grinding the gears in your work, the company’s spiritual and financial runway is shorter than it could be. It’s kind of surprising that in the mid-1800s there was a person who struggled with what it meant to be a good general manager. His struggle can save you time and worry. Borrow McCallum’s ideas to put grease on the gears.

Michael Dearing is the founder of the venture capital firm Harrison Metal. He has held numerous executive roles at companies including eBay, Filene’s Basement and the Walt Disney Company.  He most recently served as an associate professor at Stanford University’s d.school.


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Ben Horowitz On Management - Business Insider

Ben Horowitz On Management - Business Insider | Competitive Edge | Scoop.it

The excerpt below is from the lecture "How To Manage," by Ben Horowitz, investor, entrepreneur, and co-founder of venture capital firm Andreessen Horowitz. It appears in the online class "How To Start A Startup."
This text is annotated! Click on the highlights to read what others are saying. If you'd like to add your own insights, comments, or questions to specific parts of the lecture, visit the lecture page on Genius, highlight the relevant text, and click the button that pops up. Your annotation will appear both here and on Genius.

When Sam originally sent an email for me to do this course, he said "Ben can you teach a fifty minute course on management?" And I immediately thought to myself, "Wow, I just wrote a three hundred page book on management. So that book was entirely too long."

I didn't actually have time to collapse the three hundred pages into fifty minutes. Like Mark Twain, I didn't have time to write a good short letter, so I'm going to write a long letter. But in this case, I am going to teach exactly one management concept.

I see CEO's mess up this one management concept more consistently than anything else. From when they're very, very early to when they're very, very big as a company. It's the easiest thing to say and the most difficult to master. The concept in musical form is from Sly and the Family Stone. "Sometimes I'm right and I can be wrong. My beliefs are in my song. No difference what group I'm in."

That's the musical version of today's lesson. For those of you who are musical, you can leave now.

Read more: http://snip.ly/Degy



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7 Startup Success Factors that are Often Overlooked | PAKWIRED

7 Startup Success Factors that are Often Overlooked | PAKWIRED | Competitive Edge | Scoop.it

The basic startup success factors? A good idea, dedication, clarity in one's objectives, proper marketing. These are a given, and they've been covered on just about every business blog under the sun . But what about those insidious little factors that could sneak in and ruin everything without your knowledge? There are plenty of factors that could hinder a startup’s overall success – ones that aren’t all that obvious.


1. Providing better than average customer service
The key to providing a good customer experience isn’t rocket science. It’s simple empathy – the ability to put yourself in the shoes of another. If there are areas within your operation that feel shaky, put yourself in the shoes of your customers (or hypothetical shoes, if you do not have customers yet). Go through your website as if you were a customer. Ask yourself questions like, “would I want this delivery method?” or “would I wait this long for service?” or “would I be happy with this email response?” If there is any wobble, and you can’t answer with a definite yes, your customer service needs some work.

2. Continuous learning
Startup founders must be diligent about personal education. If you’re done learning, your business is done growing. According to the Startup Genome Report, “startups that have helpful mentors, track metrics effectively, and learn from startup thought leaders raise 7 times more money and have 3.5 times better user growth.”

There are plenty of tough lessons to learn in the early years of a startup – and that is for those who are lucky enough to make it that far. By trial and error, founders must learn what issues are worth worrying about, and which can’t be controlled. This not only leads to wisdom and insight, but also helps to avoid burnout.

3. Retaining employees
The importance of finding quality talent is a given, but retaining that talent is often less emphasized by thought leaders. Particularly important for new startups is the need to retain team members. This gives a startup a distinct identity to settle on and a foundation from which to grow. Retention is also crucial for partners and investors who play a firm role in the development of the startup.

4. Not just “following your passion
There is a difference between what you want to provide and what people want to spend money on. Yes, it’s a match made in heaven when those two things happen to align, and the idea you are passionate about becomes a lucrative endeavor. However, you shouldn’t assume that there is high demand for a technology or service without doing much research. Be sure your industry is in a growth phase, or at least confirm that there is a subset of people awaiting the solution you will offer.

How do you know if an idea for a new startup, product, or launch is viable? There are a number of online tools and resources to help tease out an answer, however, a little communication goes a long way. Talk to those already in the industry, and anyone you know that suites the description of your target market. Business leader Janet J. Kraus, uses a simple and clever method for determining the value of an idea, called oxygen, aspirin, or jewelry.

5. Scaling at the right time
Scaling too early is another common problem for new startups, and as much as Forbes tirelessly tried to warned you, you could scale too soon without even realizing it. Again, according to the Genome Report, “solo founders take 3.6x longer to reach scale stage compared to a founding team of 2, and they are 2.3x less likely to pivot.” So this is especially risky for those flying solo.

But how do you know when it’s time to scale? Generally, you’ll be exhausted when it’s time to scale up. Founders who aren’t getting the help they need may get bogged down in miniscule tasks that a freelancer or assistant should be handling. If you feel distracted from core tasks, or like you are doing 10 different jobs to keep up with growth, scale away.

6. Not getting hung up on investors
For those working within service-oriented startups (i.e. there’s no tangible product), finding investors shouldn’t be a priority, as they aren’t going to invest in a startup that requires minimal capital. If nothing else is in place, finding investors will not deliver success – it will simply mean you have more people to apologize to when things go south. If you’re not even close to convinced, check out 10 Reasons Why I Self-Funded My Startup and So Should You for more considerations.

7. Precise Targeting
We’re often told in life, “not everyone is going to like you, and that’s ok.” This applies to startups too. Oftentimes startups will overcompensate with broad-scale marketing to make up for the fact that they simply don’t have a target audience, or more likely, they don’t know their target audience. A few quality, repeat customers will always trump a higher quantity of one-time customers. If you’re looking to be around next year, focus on the few customers who return for big purchases, not the bundles who drop in for the metaphorical pack of gum.


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Little’s Law Is Big For Startups | TechCrunch

Little’s Law Is Big For Startups  |  TechCrunch | Competitive Edge | Scoop.it

Traffic, traction, growth. We all know that these terms are prerequisites to success. As we launch our startups we hope for initial customer acceptance, which would lead to traffic, traction and growth (TTG). In some cases, we’re willing to pay for traffic. In most other cases, we work around the clock to ignite organic TTG.

When we read about the successful co-founders of a Yelp, Pinterest, or WhatsApp, we find ourselves inspired by their drive and intellect, but we often leave wondering what it really was that gave these startups the astronomical TTG that we all want. There’s certainly no shortage of ideas and opinions about how one startup achieved success, but as analytical founders, the prescribed path from “good to great” often does not satisfy us. We crave more mathematical guidance.

One discipline to turn to in order to understand the underlying mechanics of business is operations research (OR).

OR principles not only guide us to optimize and run our businesses smoothly but also provide us with statistical analysis of underlying business concepts via modeling and simulation. One of the most interesting studies in OR which provides relevant guidance to today’s applications is queuing theory. And inside queuing theory, Little’s law is a hidden gem that gives us profound hints on where to focus to achieve superior traffic, traction and growth.

Queuing theory in its simplest terms tackles problems within the context of the following flow in a store:

Arrival –> Service–> Departure

In a queuing system, there are items that arrive at some rate to the system. Then they depart. An item can be a customer or inventory. When we think about it, this is exactly what we have on a website or app. Visitors arrive, they stick around for a while, then they leave. The most valuable company is the one with the most visitors that stay the longest.

Little’s Law says that, under steady state conditions, the average number of items in a queuing system equals the average rate at which items arrive multiplied by the average time that an item spends in the system.

Letting

L =average number of items in the queuing system,

W = average waiting time in the system for an item, and

λ =average number of items arriving per unit time, the law states the following:


“The long-term average number of customers in a stable system is equal to the long-term effective arrival rate multiplied by the average time a customer spends in the store.”

This statement sounds trivial. Its magic, however, lies in the simplicity that the relationship is not influenced by the service distribution, service order or anything else. It’s not influenced by the color of the site, the distribution of the content or the price of the product. The only thing that matters is how fast the visitors are coming and how long they’re staying. Everything else is secondary. Little’s law doesn’t only apply to queues in physical stores; it applies to networks and to any system where there’s a flow of items.

To examine a real-life situation, it’s safe to claim that Google, as a search engine, has the highest arrival rate of visitors, namely λ. But the visitors don’t stick around much. They quickly click through to another site via organic or paid links. Then they come back later for another search only to leave quickly. Google has done a phenomenal job at building up that arrival rate that made the company what it is today. But take a look at the acquisitions, research or any other top initiative at Google, and you’ll easily see that all of them target the second part of Little’s law: W, the average time a customer spends at a Google property, whether that’s email, phone, calendar or web browser.

According to Comscore, Google received about 13 billion search queries in March 2014. This translates to 433.3 million queries per day, 18 million per hour, 300 thousand per minute and only 5,000 per second. A quick comparison to Bing looks like this:

 

Number of search queries

TimeframeMicrosoftGooglePermonth3,600,000,000.0013,000,000,000.00Per day120,000,000.00433,333,333.33Per hour5,000,000.0018,055,555.56Per minute83,333.33300,925.93Per second1,388.895,015.43Per millisecond1.45

 

One wonders if Bing at any point exceeded Google’s 5,000 per second search rate. If yes, that’s good for Bing and bad for Google and it’s crucial to figure out why that jolt happened at that particular second. Investigating short bursts of higher-than-usual traffic leads to significant hints versus observing daily or monthly numbers.

Now consider Facebook. Facebook has both great arrival rate and time spent in “store.” But its customer arrival rate (λ) is not as high as Google’s. This is why all the top acquisitions and projects at Facebook target increasing the arrival rate. We visit Facebook a few times a day and stick around a little bit but then we quickly jump to a Google search.

Operation managers and entrepreneurs are more concerned with the throughput rate rather than the arrival rate. But the throughput rate is important only if there is arrival. Arrival is certainly a binary function without which there’s no usefulness. Once visitors arrive, the key metric to monitor is how fast they arrive, not how many.

Here are three implications of Little’s law as it applies to startups:

  1. For investors evaluating startups, it’s best to examine traffic figures at the lowest level of granularity possible. Even if the monthly uniques are low, surges in traffic at much smaller time intervals provide traces of higher value. The reverse is also true. Dips in arrival rates may suggest potential problems.
  2. For an entrepreneur, instead of focusing on the monthly stats, working on how to increase the searches per second is a healthier effort — particularly for those wanting to disrupt a certain market. The traffic numbers may be up and down and all over the place throughout the month, but it is the peaks of high traffic per second (or millisecond) that deserves the attention.
  3. It’s important to focus on why and how the influx of visitors surged in the smallest time frame available. Work to figure out ways to sustain that instead of focusing on monthly uniques.

Little’s law provides hints for social or viral growth, too, because in both cases, influence is spread out in short bursts as people visit the site/page/app almost all at the same time. Viral influx is the dream of a startup and after that, some level of stickiness is required to keep people around. But early traction trumps great content. Normalizing your metrics over time and looking at meaningful windows of time are a lot more useful than just looking at long-term averages.

If you’re hungry for analytical insights on traffic, traction and growth, look no further than queuing theory and particularly Little’s law. For those of you interested in the mathematical proof of Little’s law, here’s the link to Professor Little’s 2011 paper celebrating the 50th anniversary of his theory.


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How to Get Traction for Your Startup and Funding

How to Get Traction for Your Startup and Funding | Competitive Edge | Scoop.it
Most startups want to get funding, but what they need are customers to prove demand... only then will they get funding. This article will focus on ways to use Kickstarter to not only build a customer base, but also demonstrate to investors that there is demand.

Most startups want to get funding, but what they need are customers to prove demand... only then will they get funding. This article will focus on ways to use Kickstarter to not only build a customer base, but also demonstrate to investors that there is demand.

There will include lots of successful stories on Kickstarter. The press enjoys them and they are highly shareable--because of the social media era. Currently, crowdfunding sites have become a highly popular medium in order to fund and promote your following business venture, which includes the hilariously simplistic ones. Presently everybody is buzzing in regard to the Kickstarter participant from Columbus who utilized the website to attempt to raise ten bucks to cook potato salad for the initial time. The Ohio Kickstarter user managed to exceed his Kickstarter project objective and obtained more than $55,000 in funds.

Most fantastic Kickstarters, unfortunately, don't get this much success, especially the technology-concentrated ones. What is the reason for this? It's likely because individuals have a more difficult time visualizing and understanding projects with more technical topics.

For the ones who have more tech-concentrated projects, here is how you can leverage Kickstarter in order to make your project successful:

1) Simplify your Messaging

It is important that you relate to the target audience and it may be challenging if the project is extremely technical. As you are creating product descriptors, consider your audience and then ask: Do they get my product? Do they see value in my product?

If those questions are answered prior to posting the campaign, chances are the average individual is going to be more than likely to back you.

2) Promote through Social Media

This one seems as if it should be a no-brainer--particularly coming from a PR viewpoint--but it is vital that you frequently generate fresh content during the month-long Kickstarter project. Posting updates daily to Facebook, Twitter, Google+ and LinkedIn will assist you in driving more traffic. Plus, as you have these backers, that new content isn't just critical for updating these individuals, yet additionally from a search engine optimization perspective. You also can boost the project's engagement by reaching out to related projects, for purposes of cross-promotion, in order to dip in one another's backer pools.

3) Engaging Social Networks for Backing

It has been theorized that securing funds upon the first day of a Kickstarter launch includes the ideal method of ensuring a project is a success. One method of doing so includes engaging followers on social networks, by reaching out to your social media connections prior to launching and reaching everybody you know using email projects. You have to maximize the donor pool.

4) Spotlight Uniqueness to Provide Backers Reasons to Promote and Support You

It's crucial that you spotlight why your Kickstarter project is special. Techniques like personal marketing will be just as vital as marketing your product. With a public crowdsourcing campaign, individuals will be more than likely to turn away from an opportunity to fund if they do not feel connected to an individual requesting funding. Writing a letter or creating a video that explains why you require the funding includes a great method of connecting with the audience.

It also is useful to provide tangible rewards which will appeal to the audience, to increase backers' interest within the project.

5. Earned Media and PR

Press coverage and 3rd-party validations that highlight your campaign include the most efficient methods of driving a special audience to a landing page. However, to accomplish this type of validation will take more than merely talking about the product. Providing thought leadership upon associated product trends, the competition, and the wider marketplace could assist in securing mentions and increasing your visibility.

Piece of the Pie on Kickstarter

Launching a highly successful Kickstarter project may be a good way to increase your enterprise's visibility, as well as generate a customer base, prior to searching for seed funding. And by leveraging the above tips, hopefully more technology startups may boost their odds of taking a cut of the more than the $1 billion dollar pie of Kickstarter funding the platform has accrued so far.


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7 Lessons On Business And Success You Won't Learn In School

Here are 7 important lessons on business, entrepreneurship and success I have learned from interviewing over 60 successful entrepreneurs from around the world.

Less than 3 years ago, frustrated by my lack of success, I made the decision to start reaching out to and learning from successful people.

There was just one problem: I barely knew any. So I did the only thing I could think of, and that was to start a blog.

With a blog as my platform, I started interviewing successful people. It took me over a year to find my groove (I had absolutely zero online marketing experience before doing this), but eventually the blog became a podcast, and the podcast became a community.

As I write this article, I’ve had the privilege of interviewing over 60 successful entrepreneurs from all over the world. Their collective stories and advice have rewarded me with an education on business and success unlike anything that is taught in a classroom.

 

Here are 7 important lessons on business and success I have learned from this journey:

 

1.Success is 90% failure.

Some people define success as doing everything right – as getting the result they want. They view failure as something to be avoided at all costs. They try to create a perfect plan, and they only take action if they are confident that their plan is going to work. They try to avoid failure, thinking that by avoiding failure they will achieve success.

One of the things I’ve learned from interviewing so many successful individuals is that they’ve all experienced failure, and their failures often preceded their successes. This led me to conclude that a person’s failures actually serve as the stepping stones to their successes. Therefore if you avoid failure, by default, you also avoid success.

Stop worrying about failure and stay focused on your results. When you get the result you want, you might call that success. When you don’t get the result you want, you get the feedback you need to change your strategy.

Don’t be afraid to take action with no promise of success. It’s better to take the wrong action and pivot than to not take any action at all. Expect 90% of what you try to not work. Sometimes you have to learn what doesn’t work in order to find what does.

 

2.Hire help. Great people are not as expensive as you think.

We live in a global, digitally connected economy. This means that we all have access to a global talent pool of incredibly skilled individuals for very competitive rates. Even if you’re not a business owner, do yourself a favor and hire help as soon as possible. You’d be amazed how much of your precious time you can get back if you leverage the time and expertise of others.

Whether for a specific project, or on a long term basis, it isn’t hard to find the right people for the job and it isn’t expensive either. I currently manage a full time virtual assistant and doing so takes only a few minutes of my time per week. I also hire contractors and freelancers for specific tasks and projects on a regular basis.

If you haven’t already, check out www.elance.com or www.odesk.com and see for yourself just how easy it is to find and hire great people. You’ll be glad you did.

 

3. Don’t get too attached to your ideas. Test them before you invest in them

I once met an individual who told me they had a ground breaking idea for a new business. There was just one problem: they refused to tell anybody what their idea was because they were scared someone would steal it. This person failed to recognize that ideas, by themselves, ideas have little value. The real value comes from execution.

There is no shortage of ideas in this world. Many of us have ideas on a daily basis. Are all of them good? Absolutely not. Until an idea is actually implemented, there is no way of knowing how valuable it really is.

Testing an idea on a small scale to see what result it creates is much wiser than investing time, energy and resources pursuing something only to discover that it doesn’t work. Let go of bad ideas early and quickly. More ideas will always come to you.

 


 

4. Stop networking. Start building relationships

In the context of business, networking is typically defined as “interacting with other people to exchange information and develop contacts, especially to further one’s career.” It’s a pretty straight forward definition, and yes, networking can yield many benefits. The problem is that most people haven’t been taught how to do it properly.

The typical approach to networking consists of attending conferences or events in your industry, delivering your “elevator pitch” to everyone you meet and giving out and/or collecting as many business cards as possible, hoping that those connections somehow turn into employment or business opportunities. This has become one of the least effective ways to build a strong network.

To build a strong network, shift your focus from collecting contacts to building relationships.

Become genuinely interested in the people you meet. Encourage them to talk about themselves. Ask them about their current projects, and find out if there are any challenges they are currently facing. Offer a helpful suggestion, idea, or an introduction to someone else who can help them. Give without any expectation of receiving. You’ll soon discover that when you selflessly add value to others, they will gladly return the favor at some point in the future.

 

5. Model other successful people but don’t try to be them

Regardless of which industry you’re in, there will likely be other people who are ahead of you and who you consider to be more successful than yourself. This is perfectly fine. In fact, one of the most efficient ways to succeed in any industry quickly is to learn the principles and model the strategies of those who are already successful. But always remember one thing: you are not them.

Learn and apply what has worked for others to see if it will work for you, but never try to be something that you’re not. Remember that you are unique. Do what feels true to you. Always be authentic. Don’t get caught up in comparing yourself to other people. No one succeeds overnight. We all must start from where we are and with what we have. Respect the journey that other people have travelled, but remember to stay focused on your own.

 

6. Results speak louder than credentials

I definitely respect the dedication of people who invest several years obtaining degrees and credentials to advance their careers, but the harsh reality is that credentials alone have almost no bearing on the level of success a person attains. In fact, many highly qualified individuals often find themselves without work or beginning careers in new industries for reasons that were beyond their control.

We live in a results-based economy. To ensure your success regardless of which industry you are in, you must acquire any and all skills that will enable you to get results. If you’re an entrepreneur, you must learn how to get results for your business. If you work for someone else, find out what result they want and help them get it.

Many of the successful entrepreneurs I have interviewed barely made it through high school and yet no one questions their intelligence or skills. Why? Because they have a track record of tangible, hard won results. A track record of positive results speaks louder than any credentials you print on a business card or a resume.

 

7. The journey is the reward.

The final lesson that I’d like to share with you is to enjoy the journey. The trouble with ambition is that it causes us to chase the future, often at the expense of appreciating the present. Pause and reflect often. Praise yourself for how far you’ve already come. Stay focused on the outcomes you want, and respect the process required to create them.

Set big goals not because of what you will get when you achieve the goal, but for what it will make of you in the process. The person you become as you achieve your goals is more valuable than the goal itself.

“The ultimate reason for setting goals is to entice you to become the person it takes to achieve them.” – Jim Rohn



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Failure is good, but here are 10 mistakes your startup should never make

Failure is good, but here are 10 mistakes your startup should never make | Competitive Edge | Scoop.it
If you believe you need to fail before you can succeed, at least make sure you fail in an original way.

Failure is the fertilizer of Silicon Valley, or so we would have you believe. Like fraternity hazing, we take excessive pleasure in warning plebes (aspiring entrepreneurs) that 80 to 90 percent of all startups fail.

But failure, when you get right down to it, is neither inevitable nor anything to brag about. As Silicon Valley veterans — Oracle, Sun, SynOptics, and over 40 startups and tech giants — we’ve had ringside seats to some of the greatest successes and flame-outs in tech history. And while everyone associated with technology startups knows that you need to kiss a few frogs at times, we’ve created an early warning ‘failure list’ that we consult before we pucker up:

  1. It’s the technology, stupid. If they take this approach, they’re lost before they start — and yet it’s the single largest startup sin. The founders have spent years creating their technology and so assume it’s as compelling to others as it is to them. It isn’t. It’s not what the technology can do (speeds and feeds), it’s what it can do for the customer. Solutions sell, technology doesn’t.
  2. Make the CEO a rock star. Too many first-time CEOs think they’re the next Steve Jobs — down to the bullying behavior and grandiose statements. But even Jobs had his Wozniak. VCs invest in teams, not individuals. As Walter Isaacson’s new book The Innovators attests, if a CEO doesn’t bring in a strong exec team, listen to them, and share the credit, the startup will soon be a true one-man operation for all the wrong reasons.
  3. Spend early and big on branding. Don’t create your brand in a cocoon, or with the help of a high-priced branding agency. Let it evolve organically, based on your company culture and customer reactions. The resulting brand will be truer — and cheaper.
  4. Give the UX director power over the brand. A powerful UX director, strong on visuals and light on Marketing, can do great damage to your marketing efforts. If you’re not going to let your VP of Marketing design your UX, don’t let your UX director have control over your brand.
  5. Let your people choose their own job titles. Then consider what titles like “sales guru” and “growth hacker” are costing you in enterprise sales.
  6. Print T-shirts to mark product milestones instead of customer milestones. The more t-shirts your company has before its first major sale, the quicker investors should head for the door.
  7. Go virtual from the start (flex time over face time). This is a tough one, since we know how hard it is to hire these days, especially with Google and Facebook poaching the best talent. But hiring remotely from the start is a recipe for failure. Too many of a startup’s best ideas happen in ad hoc meetings and shared work space. Bottom line: Face time trumps flex time, at least in the early, formative days of a startup.
  8. Revise your value proposition early and often. Many companies, having read The Lean Startup, think that just because they can throw their product out into the market, gauge initial reaction, and quickly respond, they can do the same with their core value proposition to the customer. Nope. Playing with your core customer value doesn’t make you look responsive, it makes you look indecisive. Challenge and iterate your positioning and messaging before you launch, then go through one sales cycle before you make any major changes.
  9. Leadership, not management, is the key to success. “Vision” (usually the domain of the CEO) is critical to a strong launch. But once you’ve had a strong start and early sales success, it’s time to focus on growth and execution. The days of everyone reporting to the CEO are over, as are the days of the CEO making every major decision. It’s time to manage — in some cases ‘manage managers’ — an entirely new (and essential) skill. If the CEO can’t make the transition, make him/her ‘Chief Evangelist’ and find a new CEO.
  10. Let your Board of Directors be very hands-on. The more you see board members on-site at a startup, the better the chances that the company is flailing. A strong CEO needs to rely on the BOD without depending on them.

So, if you believe you need to fail before you can succeed, make sure you fail in an original way. Because all of the above are avoidable.

Tom Hogan and Carol Broadbent are the founders and principles of Crowded Ocean, a Silicon Valley marketing agency that has launched over 30 startups, with 10 of those companies being either acquired or gone public.



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Marc Kneepkens's insight:

Wow! Lots of wisdom and experience here. Startups, listen to this.

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Delighted Makes It Easy For Startups And Other Businesses To Collect Customer Feedback | TechCrunch

Delighted Makes It Easy For Startups And Other Businesses To Collect Customer Feedback | TechCrunch | Competitive Edge | Scoop.it


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Delighted, a startup that aims to help businesses collect and analyze customer feedback, is ready to move its product out of private beta testing and make it available to any customer.

In addition, the company is announcing that it has raised funding (it won’t say how much) from Google Ventures, Shasta Ventures, SV Angel, Designer Fund, Fuel Capital, Relay Ventures, Ben Ling, Bobby Goodlatte, Jason Shellen and Fred Reichheld.

Delighted was founded by Caleb Elston, Mark Dodwell and Mike Gowen. The three of them worked together on the Mosaic iPhone app for photobook company Mixbook, and Elston and Gowen also worked together on Yobongo, the mobile chat startup that Elston co-founded (which was eventually acquired by Mixbook).

It’s been more than a year since I wrote about the company — Elston (who’s also Delighted’s CEO) said at the time that the team would do something related to customer feedback, but it was too early to get specific about the product. Since then, Delighted has been testing its product with a number of businesses. In fact, if you’ve responded to a customer survey recently from Design Within Reach, Bonobos, Eventbrite, Goodreads, TaskRabbit or Hotel Tonight, it was probably created and sent via Delighted.

So what makes this different from the other survey tools out there? Again, the aim is to be super simple, both on the customer side and the business side. Hopefully, that can mean the business gets feedback from a larger, more representative group of customers, not just the ones with big complaints or who need assistance.

Elston gave me a quick tour of the product to illustrate his point. When you receive an email survey (on desktop, mobile or tablet), you’re asked to respond with a single click that indicates how you’d rate your experience with a given product or service. You can offer a more in-depth explanation, but all you need to do to complete the survey is make one click.

It’s pretty simple to create those surveys, too — Elston whipped one up in just a few minutes during the demo. And once a survey goes out, businesses can track their Net Promoter Score, to get a general sense of how they’re doing. Then they can dive deeper into the numbers by searching for specific terms or filtering by different customer types.

Other features include the ability to trigger surveys with certain in-product events, to cap the number of surveys that a customer has seen (not just from you but from any Delighted business), and to send team members email digests highlighting positive and negative feedback. Elston also noted that Delighted doesn’t charge per seat, which means there’s nothing stopping a company from making customer feedback available to anyone on the team.

Asked if he’s interested in going beyond email surveys, Elston said Delighted is also looking at things like live chat, but he suggested that email will likely remain at the core of the experience.


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Marc Kneepkens's insight:

Customer communication is essential for a startup to succeed. Simple straightforward surveys are a great idea.

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Want to rock your next presentation? Consider asking a question.

An expert on public speaking explains how to become a more compelling--and confident--presenter by asking, not telling in the right situations.

Of all the tools and techniques a speaker can use to make a presentation more effective, the simple question is the most versatile. Think of it as the Swiss Army Knife of presenting. A well-timed question can accomplish a myriad of communication tasks, from building intrigue to fostering audience engagement, helping you remember what to say, and even calming your speaking anxiety. Leverage questions, and you can become a more compelling and confident presenter. Here's how:

Questions Connect with the Audience

Audience connection is the key characteristic that distinguishes a memorable presenter from an average one. Are audience members participating with the speaker, or simply listening to the speaker? Questions provide a great way to foster engagement. Questions by their very nature are dialogic. They're two-way: You ask and your audience responds. I recommend using three types of questions throughout your presentation to get your audience's attention:

Rhetorical questions build intrigue.

Asking your audience a question for effect (rather than one you expect them to actually answer) prompts them to think about the issue.

Example: "Would you believe that companies are making robotic honeybees to pollinate crops in locales where bees are dying off?"Polling questions make the audience part of your point.

When asking your audience to respond to your query, be sure to signal how you want them to do so (e.g., model raising your hand as you ask your question, or explain how the online poll works if you are virtually presenting) and comment briefly on the response you get (e.g., "Just as I expected, about 50% of you … ").

Example: "How many of you have ever been stung by a honeybee?"

"What if?" questions root your presentation in time.

Inquire about a possible future or the historical past; and as with rhetorical questions, you may not expect a literal response, but you definitely focus your audience’s attention on the time period you’re describing.

Example: "What would it be like if all crops were pollinated by robo-honeybees?" Or, "Remember when modern science made it possible for genetically modified vegetables to yield more crops?"

Questions Build Your Confidence

Many speakers are anxious because they feel they are under the harsh spotlight of an audience who is constantly evaluating them. But, interestingly, incorporating questions from the moment you start planning can help you feel more confident about every aspect of presenting. Here are two ways to use questions in planning to improve your delivery:

Ask yourself, "What does my audience need to hear from me?"

Instead of seeing speaking as a performance, think of it as being in service of your audience's needs--this shifts the attention away from you and onto your audience. The most useful way I know to focus on your audience is to start by asking yourself the simple question: "What does my audience need to hear from me?" This not only helps you tailor your message to your audience, but it also reminds you that they are the ones in the spotlight. Make this question your mantra as you prepare and practice your presentations.

Outline your talk using questions.

When writing your next outline, create a list of questions to serve as prompts for what you intend to say. I loathe speaking manuscripts and full-text speaker notes, which only invite memorization and actually increase performance anxiety. An outline, on the other hand, is a very practical tool to help speakers prepare and deliver. And the power of a question-based outline is twofold: First, it allows you to feel more confident because you know the answers to your questions--you no longer need to worry you might not know what to say. Second, you will be more conversational, since you are simply answering your audience's unasked questions, and conversational delivery is often better remembered by audiences.

When you next face preparing for and delivering a presentation, consider using the MacGyver of communication tools, the question. For just about any task at hand, it can yield all kinds of benefits for you and your audience.


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Marc Kneepkens's insight:

Present better, here are some good tips.

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5 Ingenious Ways to Make Your Mark on the Business World

Solid branding plays an integral role in the success of any business. Here are five ways that you can further develop your brand and make your mark on the business world.

The way that you communicate in the business world is through your brand. It's what speaks to your customers and investors and allows them to get a better understanding of your company and the products and services you offer. Branding is something that has to be done subtly and by those who truly know what they are doing--there is a little bit of art involved, a little bit of psychology, and a little bit of bare bones business that goes into it, which makes branding something of an art form. The following are five ways to enhance your branding and really make a mark on your customers--and the market as a whole.

Adaptability

In order for a brand to have staying power, it needs to remain adaptable. Brands that have logos with a dated air to them will never stick around for long in a world that is changing more and more rapidly every year. Having something that is simple, clean, and leaves room for embellishment when need be is going to be a brand that sticks in the minds of customers and has the staying power that every business seeks for its image and public persona.

Memorabability

Above all other things, your brand needs to be memorable. Everybody can tell you what the company attached to "Just Do It" is. Having a simple, memorable slogan like that will be what sets your business ahead if you decide to go the slogan route with your branding (not every brand has or needs a slogan). Even the logo for your brand needs to be memorable and unique--trying to piggyback off of the success of other popular logos will just lead to your brand being forgotten in the shadow of the established brand with that logo.

Authenticity

The brand needs to be connected to what the business actually offers. The brand needs to be something that customers can touch on and identify with, and something that clearly conveys what the company will provide for the customers through imagery and atmosphere that the brand's logo, slogan, and other marketing materials provide. This needs to be something that gives an authentic representation of the brand's attitude and public goals and maintains the other important parts of branding at the same time (one of which is simplicity). Choosing a logo or a slogan for your brand should not be done offhandedly, as you will need to stick with it forever.

Likeability

In order for your brand to stick in the minds of your customers, there is going to have to be something about it that is likeable, even if it is on a subconscious level. Having linguistic elements like alliteration and rhyming will make your name easier to stick in the mind. Tying your name to a popular concept or having it be a play on words is another good way to get it to make an impression upon your customers.

Transferability

Given that some of the largest portions of the market are growing foreign marketplaces, you should keep in mind the translation of your slogans, advertisements, and name into different languages. Inherent meaning can easily be lost in translation, so to avoid marketing faux-pas (the Mexican marketing of the Chevy Nova comes to mind), so settle on something that can easily be ported to another language or country and still works as effortlessly as it did in your native language. This kind of preparation can only help your business in the long run, as adaptability to different markets will give you more of an advantage over your competitors than anything else.


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Marc Kneepkens's insight:

Excellent ideas for branding. Keep in mind when coining your business name and logo.

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New $140 Million Early-Stage Fund Launched in Europe Called Mosaic Ventures

New $140 Million Early-Stage Fund Launched in Europe Called Mosaic Ventures | Competitive Edge | Scoop.it

Three well-known tech investors and execs announced today that they had launched Mosaic Ventures, a new $140 million fund aimed at early-stage investments in Europe. It was created by Mike Chalfen, Simon Levene and Toby Coppel, all of whom have worked across a range of venture firms and Silicon Valley companies over the years. On its website, the group said: “We love renegades who take a fresh look at the world and want to shape it their way.” Bokay, boys!


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Via Raj Nadar
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Yet another seed fund in Europe. Startups are moving all over the world!

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Startup Mentors — How Do You Filter Out The Good, The Bad And The Ugly? | TechCrunch

Startup Mentors — How Do You Filter Out The Good, The Bad And The Ugly? | TechCrunch | Competitive Edge | Scoop.it

In light of the recent brouhaha over the actions of a particular European investor who had a habit of attaching himself to accelerators as a ‘mentor’, it seems an appropriate time to do a quick rundown on the kinds of things entrepreneurs need to look for in genuine potential mentor to them and their companies. Because, in case you have been hiding under a rock, there a lot of new ’mentors’ flooding towards technology startups, and it would be good if everyone had a clear idea of how this relationship should play out.

I asked on Twitter and on Facebook for some fast feedback on this and got what I think is a pretty representative list of ideas around what due diligence you should do when looking for a mentor for your startup. (Apologies if I don’t name-check everyone who contributed, but to give you a flavour…)

Matt Clifford of Entrepreneur First, thinks there are three main issues.

Firstly, he says, “you can’t get a (good) mentor by asking someone to be your mentor.”

He says a lot of young entrepreneurs think they need a mentor, so they assume that they should go around asking for on. But, the “best mentor relationships seem to develop organically. The entrepreneur has a series of interactions with someone and after a while both sides realise they’re getting value from the conversations and – de facto – the person has become a mentor.”

Secondly, “asking good questions is the key to being a good mentee (but is hard work).” A question like “What should I do?” is way too vague. You’ll get the most out of mentors when you ask them real, important, very specific questions that provide a lot of context, says Clifford.

Thirdly, first-time founders usually “want the wrong mentors.” First timers picking a “celebrity mentor” or one who is far, far ahead, is often a bad idea and they are much better off with someone “two to five years ahead of them on a similar journey” says Clifford.

Most of the day-to-day challenges founders face are highly stage-specific, he says. Is this the right person to help you get your first 1,000 users, for instance? “Hire more sales people” is not really an answer, and someone who’s been in that same place very recently is usually better.

Startups can of course help themselves by clubbing together and sharing information on mentors. Perhaps write a notional “mentor spec”?

But still, the basic questions apply: what they’ve done or achieved besides mentoring and advising.

Entrepreneur Ian Broom tells me: “I get mentors to agree a contract, like a staff member, and set expectations. Especially if you’re offering equity, it’s crucial the mentor vests like everyone else.”

James Bromley of Swiftkey adds that you should ask for references. And are they “ground level practical”? Also check if the mentor is a frequent ‘conference bore’, rather than actually working.

Matthias Metternich of Believe.in says you should check out the prospective mentor’s network and whether they’d be open to making relevant introductions to others. He also advises getting mentors who fulfil functional roles and who can go deep. “We have separate mentors for mobile, bus dev, branding, marketing, hiring, etc”

Mentors who are still “doers” are more valuable.

And keep them in the loop: “No one can mentor well without understanding what’s up – it’s a two-way street,” points out Metternich .

Russell Buckley, formerly of Admob now partner of Ballpark Ventures, says you shouldn’t over-pay mentors and Non-Execs, and wrote about here.

He agrees that vesting options along with other staff members means “you can fire people who don’t deliver to the stated expectations.”

“I’m also encouraging some of the companies I work with to set OKRs or KPIs (depending on the tools they use) for their Board and advisors. Not a popular idea with many Directors, but I would like to see it as normal. After all, most investor/directors sell themselves as adding value prior to the investment, so why not hold them accountable?”

Use tools to check out a mentor’s credentials and investments such as Companies House / http://duedil.com

And looking through their AngelList, LinkedIn and Twitter / social profiles etc is an obvious move but sometimes forgotten.

Eileen Tso Burbidge of Passion Capital says if the mentor has written catchy blog posts that can even qualify as usefulness as a mentor.

Then there is Jason Lemkin’s 2.5x rule which is: “After 2 1/2 meetings, after 2 1/2 intros to VCs or potential VP hires, after 2 1/2 times they “help” … you need to “pay” or they go away. Until then, you don’t have to pay. And many people if they are interested in you will make a few connections and help for free. 2-3 times.”

The simplest way to pay mentors he says is to give them some stock options and if you can, let them invest in your seed, “A and B rounds IF they want to”. But, don’t connect the two. “The first is a (for now) unquantifiable “payment” for helping. The second is a “thank you”. Don’t confuse the two, but try to do both.”

Michael Geer, COO of Dream Industries in Moscow, emailed be a few choice thoughts. “Mentorship takes the perfect timing of the team looking for mentorship and the mentor actually having the bandwidth and desire to mentor. That is much harder to get when just one side reaches out.” He says it comes together roost naturally when his mentorships have “started from accelerators or classes I’ve taught.”

He notes a drawback: many teams are either not ready to listen or not at the right stage to actually action some mentors’ most valuable advice when one side or the other reaches out. “Of course, when the timing is right, both sides learn and gain a lot.”

But how do you avoid bad mentors?

Matt Clifford says: “This is a very effective way of avoiding bad mentors, especially financially motivated ones: they just won’t last out the repeated interactions.”

In other words, bad mentors don’t burnt out, they fade away…



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Marc Kneepkens's insight:

Mentors can make a real difference. Find out what to look for.

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