Monday, April 24, 2017

Could You Be A Business Coach, Or Do You Need One?

business-coachingWe all know some peers in business who could use some coaching to unleash their potential and optimize performance, but would you know how to do the job if they asked you for help? Most people find it easier and quicker to just do the work themselves, than to guide someone else through the mindset and process needed. The result is frustration and dissatisfaction all around.

In reality, even the best performers and leaders need some coaching from time to time, and everyone has the potential to be a coach, so it behooves all of us to learn how to do it right. In an effort to help myself, I read a new book on this topic, “The Master Coach,” by Gregg Thompson. As an expert on this subject, he has provided coach training for many Fortune 100 companies.

His approach, which I espouse, is first that every company needs to make coaching an integral part of their company culture at all levels, rather than rely on occasional outside consultants to come in and fix problems. The reality is that every professional in every organization at every level needs to understand what coaching means, and how to live and build a coaching culture:

  1. Nurture the spirit of sharing in every team member. People who make great coaches, as well as the best performers, are ones who are willing to liberally share their time, attention, and energy with others on the team. Self-centered members need coaching.

  2. Partner with people who see the best in everyone. Coaches need the ability to look past the shortcomings of others to focus on their positive qualities, even if deeply hidden. Team members who are most often negative or critical of others drag everyone down.

  3. Select team members who have high self-esteem. The best team members feel good enough about themselves to not use the coaching relationship to feed their ego. Healthy self-esteem rests on the principles of integrity, authenticity, and self-reliance.

  4. Only add team members that are emotionally mature. People who are the most productive, and also make good coaches, are keenly self-aware, understand how to manage their emotions, and are able to create sustainable relationships with others.

  5. Look for people who are interpersonally courageous. These team members will boldly confront peers and those they coach, and seek truth in all conversations. People who are hesitant to engage or disagree, need coaching to bring out their potential.

  6. Coaches need uncommon empathy and compassion. They need to understand the struggle and pain that often accompanies personal learning and change, most notably from personal experience. Those who refuse to change rarely relate well with others.

  7. Life-long learners make great coaches. These have voracious appetites for new knowledge and self-development, and can inspire other team members to look outside the box for new levels of performance and satisfaction. Inspiration is the best teacher.

  8. Team members need flexibility and resilience. In the rapidly changing world of business today, everyone needs to be strong enough to bend. Both coaches and your business need to weather the setbacks and conflicts inherent to progress and success.

  9. Don’t allow judgmental voices to stymie progress. Good coaches and business leaders have an accepting nature, and overcome their human tendency to be judgmental. They speak from the heart, but rely on data and results in making decisions and strategy.

  10. Favor people with a perpetually optimistic bias. Coaches can only help if they have the power to make people see a tomorrow that is better than today. Businesses can only succeed if they can make customers see a win-win situation by working together.

Once coaching is a part of your company culture, it’s not so hard to accept coaching from your peers, or for managers and executives to ask for coaching from people at other levels in the organization.

Only then will people see that coaching ability or being coached is not about credentials, job titles, or what you do, but is more about who you are. Are you the person today that you would want as a coach?

Marty Zwilling

*** First published on Inc.com on 04/11/2017 ***

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Sunday, April 23, 2017

4 Chasms And 5 Customer Types That Kill Entrepreneurs

Technology-Adoption-Lifecycle-GapEveryone in the business world has heard of the old bestseller by Geoffrey A. Moore titled “Crossing the Chasm,” but most entrepreneurs have no idea how it relates to them. In fact, it’s all about the “focus” required to get early stage technology products across the deadly chasm from early adopters to mainstream customers.

Most investors and startup professionals expand this concept of focus to apply to key issues of every aspect of strategic and tactical planning in a startup. Missions and products that are too broad confuse your team, your customers, and potential investors. There are other chasms out there just as deadly as the technology one, such as the ones below:

  1. Market requirements chasm. The first chasm is getting the customer requirements right, product or service, to satisfy a real need that a large number of customers will pay real money to satisfy. It takes focus to resist adding a long list of features that seem to make the opportunity larger, but dilute to focus of both you and potential customers.

  2. Product development chasm. Another common chasm is never-ending product development. Focus is required to resist adding a few more neat features, made possible by the new technology, which in fact make the product more complex to use, impossible to test, and very expensive in time and cost.

  3. Marketing and sales chasm. Lots of people still believe the major cost of a new product is development. These days, with all the clutter in the marketplace, the highest cost is usually marketing. Focus is required here to pick the low-hanging fruit, break through the clutter, and then move on to the next segment. Marketing costs can be a deep hole.

  4. Customer support chasm. Products that have features which are unfocused, or aimed at too broad an audience, can be almost impossible to support. Customers need lots of help with installation, or can’t make the product work the way they expect. The result is that customer satisfaction in unachievable or at least very expensive.

In his book, Moore limits his discussion to the transition between customers that are visionaries (early adopters) and customer pragmatists (early majority), in the context of high technology products that appear “disruptive,” meaning they move innovation in that arena to a new level.

Here are the five customer segments outlined in his analysis:

  • Innovators – they love the challenge of a new technology and expect problems
  • Early adopters - customer visionaries driven by technology who expect it to work
  • Early majority – pragmatists that buy only with peer review, references and support
  • Late majority – conservatives who wait until the product is no longer state-of-the-art
  • Laggards – skeptics who will only adopt when forced or the need is critical

The reason that his book was so popular, and is still studied in MBA programs and talked about by investors, is because his analysis has proven to be right so many times. There is a big gap between people who love to try new technologies, and the rest of us, who tend to be much more “technophobic.” Startups need to show real traction before attempting to cross the chasm.

I always recommend focus as the key to avoiding Moore’s chasm, as well as the others highlighted here. Start your business with a narrow niche and a focused strategy, but don’t stay there. As the company matures, and you learn more about your customers and your market, then it is time to go broader or deeper.

Build an overt strategy with feedback triggers to enhance the product to meet the needs of another segment of customers, and add more features to serve additional needs for the customers you already have. With this approach, you will find it a lot easier to jump all the chasms without crashing or breaking a leg.

Marty Zwilling

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Saturday, April 22, 2017

6 Cases Where Quick-To-Market Beats Market Research

target-market-ready-fire-aim

I know entrepreneurs who have suffered from premature execution often associated with the ready-fire-aim quick-to-market approach. Yet I believe that many more have benefited from this approach, especially in early startup stages. If your product is highly innovative, and speed to market is critical, you won’t get it right the first time anyway, no matter how cautiously you plan.

The ready-aim-fire traditional approach works best in more mature markets, where your strategy is to add features and value to competitive products, or address an underserved new segment of the marketplace. These are the environments where you really need extended planning to ensure proper positioning before launching the product.

But Lonnie L. Sciambi, in his classic book, “Secrets to Entrepreneurial Success,” reminds me that premature execution will doom even a good ready-aim-fire plan. This most often happens due to impatience, which is not typically an entrepreneurial virtue. It also happens due to overreaction to some market surprise, a last-minute input, or a squeeze on cash.

Even when a good plan is possible, I believe there are many circumstances where the ready-fire-aim approach is the best alternative, even though it may be counter-intuitive that one can fire without having aimed precisely. Here are the key parameters that can swing the pendulum:

  1. Engineers have an uncontrolled ability to add more features. Many good ideas never get off the ground, simply because the product or service is never “finished.” Some entrepreneurs don’t believe in the “minimum viable product (MVP)” approach, and they keep thinking they need to get the vision absolutely perfect before launching it.

  2. Entrepreneur confuses sense of urgency with sense of emergency. Urgency comes from an outbound purpose to get market returns quickly, while handling emergencies is a reactionary inward approach to saving ourselves from the daily crisis. It’s easy to be too busy to aim, so ready-fire can get you moving, but may generate the next emergency.

  3. Impossible to get adequate market information for any given plan. For innovative new products in a "fast-paced culture," entrepreneur leaders can’t count on conventional market research or expert consultants to give them the data to build a plan. After you've "fired" once, you have some actual data with which to adjust your aim.

  4. The target market is moving in unpredictable ways. Marketing is inherently a trial and error process in new and unknown environments. The ready-fire-aim approach works best here, but must be used with a plan to learn from misses and feedback, rather than random shots into the dark. Be prepared for pivots and mistakes.

  5. Planning cycle for determining certainty is too long. Too many entrepreneurs get bogged down in planning and thinking and never get to the point of action. This leads to another dreaded syndrome, called analysis paralysis (i.e. ready-aim-aim-aim-aim-aim...). If they don't fire before they aim, they may never take action at all.

  6. Cost of a planning cycle is greater than cost of an execution iteration. Start with a strategic plan that embodies an iterative launch cycle, with a minimum viable product to a focused and limited domain, and the cost of execution will be low. That limits the scope of your plan, makes is more measurable, and forces you to plan for change.

It was Tom Peters and Bob Waterman (“In Search of Excellence”) who first came up with the “ready-fire-aim” go-to-market strategy. I like it in many cases, since it is action-oriented, helps streamline and decrease product development time and costs, and focuses the product and the firm on customer needs rather than technology.

Of course, if you fire without aiming, there’s always a greater chance that you will shoot yourself in the foot. I’ve even seen some entrepreneurs who quickly reload, only to shoot themselves in the other foot. Making your business a game of Russian Roulette is not the way to success. If you can’t plan ahead, at least plan to learn from your mistakes.

Marty Zwilling

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Friday, April 21, 2017

Smart Entrepreneurs Favor People-Centric Leadership

Employees-Office-Greeting-WorkEvery business needs repeatable processes to grow and thrive, but modern business processes need the right people to make them efficient and productive. In addition, today’s customers judge a company by perceived people relationships through social media, phone conversations, and sales experiences. The right people make productive processes, not the other way around.

Thus I believe that business leaders and entrepreneurs need to focus first on people leadership, rather than process leadership. As a business advisor and investor in new startups, I see how difficult it is to make any process work, no matter how well designed, if the team is dysfunctional. On the other hand, I see teams with almost no process that are tremendously productive.

Of course, some balance is required. That’s why I was pleased to see the balance on people versus process in a new book on how to fix your organization, “The Diamond Process,” by Mike J Diamond and Christopher R Harding. These authors highlight the importance of both in their guidance on becoming a complete leader. Processes without people leaders will still be chaos.

Thus I find that the best entrepreneurs and business leaders today are people-centric, but they never forget that efficient repeatable processes are required as the business scales up. There are many advantages to this focus today, including the following:

  1. It takes people to see the need and adapt to change. Today’s pace of change in the market and in technology is unprecedented. Business leaders who are people-centered understand that a learning culture, tolerance for mistakes, and innovative approaches are required to thrive. Process leadership focuses on repeatability and efficiency only.

  2. Customers demand more engagement and flexibility. People-centric leaders drive ownership and engagement down to their customer-facing team members. For this to work, team members must commit themselves and freely accept accountability for their actions. In the end, engagement drives customer retention, sales, growth and profit.

  3. Leaders need direct and open team communication. Effective communication in a rapidly changing environment must be two-way and continuous, from all levels of the organization. Leaders need to share their values and goals, as well as challenges, to get effective assistance and buy-in from team members delivering the company image.

  4. You need a team focused on the future as well as the present. Long-term business survival and success requires everyone taking calculated risks for future gains, rather than blindly following a hard-coded process that seems to work today, handed down from leaders on high. People-centric leaders encourage and reward thinking outside the box.

  5. Self-motivated people require less supervision and management. This means more time for leaders to concentrate on looking ahead and rewarding team progress, rather than managing corrective individual performance actions and motivational incentives. Self-motivated team members are known to be many times more productive than others.

  6. Priority is placed on employee mentoring and coaching. A primary focus on process leads to highly structured training classes, leaving little room for personal career development. Mentoring and coaching tend to improve commitment, motivation, decision making, and creative talents, which are required for a competitive business and career.

  7. Taking care of people generates a quid pro quo. What goes around, comes around. If you treat people as automatons who execute a process, your team will respond in kind. If you treat your team as peer business owners, they'll be there to support you as the business changes. Leaders who demonstrate trust and respect will gain that in return.

  8. People leave you a favorable legacy long after you are gone. The mark of a complete leader is the ability to leave on vacation, and be assured that all will proceed without change. The greatest legacy that any leader can leave is a team who remembers and continues to honor the right values and objectives, even after you are gone.

Whether you are building a new organization or fixing an old one, the leadership analysis and focus needs to start with the people, and extend from there through the level of process and productivity required by the size and scope of the organization. Process leadership is important, but it’s just not effective without people leadership first.

How much of your time as a manager or business leader today is spent on people versus process? Would everyone on your team agree and return the focus?

Marty Zwilling

*** First published on Huffington Post on 04/19/2017 ***

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Wednesday, April 19, 2017

5 Key Ingredients Make A Happy Content Entrepreneur

happiness-satisfied-entrepreneurBuilding a startup is hard work for low pay, it’s risky, and it requires total responsibility to make it work. Yet, many entrepreneurs are the happiest people I know. On the other hand, I know many unhappy individuals who are always partying, have minimal commitments, and little responsibility. I suspect the real parameters of happiness have eluded these people.

According to one of my favorite authors, Brian Tracy, in his classic book “The Power of Self-Discipline,” happiness is not even a goal that you can aim at and achieve in and of itself, but it is a by-product that comes to you when you are engaged in doing something you really enjoy while in the company of people you like and respect.

Tracy defines the five key ingredients of happiness that every potential and existing entrepreneur, including Mark Zuckerberg (and every non-entrepreneur), should evaluate relative to their own situation:

  1. Happy relationships. Fully 85 percent of your happiness – or unhappiness – will come from your relationships with other people. For entrepreneurs, that includes business colleagues, but it also still includes spouse, children and friends.

  2. Meaningful work. You must be doing things that you love and give you a sense of fulfillment, as well as making a contribution. Studies have shown that the three most motivating business factors include challenging work, opportunities for growth, and pleasant coworkers.

  3. Financial independence. The happiest of all people are those who have reached the point at which they no longer worry about money. That doesn’t mean unlimited funds, but enough that they don’t fear being destitute, without funds, or dependent on others.

  4. Health and energy. It is only when you enjoy high levels of pain-free health and a continuous flow of energy that you feel truly happy. For many, health is only a “deficiency need,” meaning you don’t think much about it until you are deprived of it.

  5. Self-actualization. This is the big one, the feeling that you are becoming everything you are capable of becoming. Before this can happen, you must first feel that all deficiency needs are satisfied, and you have achieved self-esteem:

  • Survival. Basic survival is the top deficiency need, meaning sufficient food, water, clothing, and shelter to preserve your life and well-being. You cannot be happy, and you will experience tremendous stress, until survival requirements are met.

  • Security. The second deficiency need encompasses financial, emotional, and physical security. You have to have enough money, security in your relationships, and physical security to assure that you are not in imminent jeopardy of any kind.

  • Belongingness. The final deficiency need reminds us that we are social people, and we need social relationships with others, both at home and at work. You need to be recognized and accepted by other people who count in your world.

  • Self-esteem. Your self-esteem is the core of your personality and largely determines how you feel about everything that happens to you. Are you liked and appreciated by peers, doing a good job and being recognized for it, and achieving your ideals?

According to Abraham Maslow, a noted psychologist, less than two percent of the population ever reaches this height of self-actualization and personal fulfillment. But the wonderful thing about self-actualization needs is that they never need to be completely satisfied. As you stretch yourself in this direction, you experience a steady flow of happiness and contentment.

In all of these areas, you need to exert self-discipline and willpower to overcome the tendency to take shortcuts. When you keep going in spite of all obstacles and hardships, you feel powerful. Your self-esteem and self-confidence increase, and then as you move, step by step, toward your ideals, you feel genuinely happy. Are you a satisfied entrepreneur?

Marty Zwilling

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Monday, April 17, 2017

How Future-Proof is Your Company (and Your Career)?

technology-future-proofWhen you are growing a business, it’s hard to find time to focus on anything but the crises of today. Yet if you don’t spend some resources preparing for the changes in the marketplace we already know about, there may be no tomorrow for your business. In my years of mentoring and advising business leaders, I find that real planning for the future always gets the short shrift.

Of course, nobody really knows all of what tomorrow will bring, in terms of globalization, digital technology, or demographic shifts, but most experts agree that certain elements are already obvious, and things must be done today to get your business ready in time. I found some key ones in a new book, “The Future-Proof Workplace,” by Linda Sharkey, PhD, and Morag Barrett.

These authors, who both have extensive credentials as executive coaches with top tier business leaders around the world, detail six factors of change that every business needs to address today to keep ahead of the wave. I believe these factors are key to the future success of every new startup, as well as every mature company:

  1. Leadership must be values-based and people focused. The command and control leadership of the past is proving to be too inflexible, devoid of values, and not empathic to people issues – customers, employees, and partners. Check your leadership style today, and expedite the transition to one of engagement, collaboration, and adaptability.

  2. Company culture drives decision making and process. Business culture now means much more than uniformity and conformity. It now means shared values and true empowerment, which is the new key to employee productivity and profitability. A healthy culture, with living values, is essential today for growth, adaptability, and innovation

  3. Organizing principles must include social impact. Yesterday’s principles were good verbiage about profit and shareholder value, but ignored in day-to-day operation. Today, a compelling and impactful purpose, around which teams can get excited, is key. Team members want to contribute to the greater good and have pride in everything they do.

  4. Relationships in all directions are critical to success. Historically, organizations played down the role of work-based personal relationships. Google was one of the first to learn that good relationships created high-performing teams. Due to social media and the Internet, these relationships now need to extend to customers, partners, and suppliers.

  5. Diversity and inclusion bring more value than ever. Most companies never realize how much damage can be done by human unconscious bias. Only by embracing inclusion and creating a truly level playing field for all, is a company able to connect and adapt to all the diversity in today’s global marketplace, and keep up with the changes.

  6. Data technology facilitates more fact-based decisions. Technology is now much more than speeding communication and automating work processes. Technology allows forward-looking predictions of outcomes, and critical decision-making assistance through artificial intelligence, Internet of Things (IoT), medical diagnostics, and data analytics.

It’s not enough to merely talk about these changes. Every company needs to track their progress and measure results – establish metrics to understand how much and how effectively their workplaces are being transformed and compete. From a career standpoint, leaders and employees need to assess their own progress to “future-proof” their career.

It is evident that the pace of change is not slowing down, and will continue to accelerate into the future. This means that both you and your company need to be more agile, more open and willing to learn, and rethink your focus on the future versus the present. Sometimes you have to make waves today to balance and survive the waves already starting to crash around you.

Marty Zwilling

*** First published on Inc.com on 04/04/2017 ***

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Sunday, April 16, 2017

5 Solution Domains Suggest A Wealth Of Startup Ideas

entrepreneur-startup-ideasPotential startup founders are always looking for ideas to implement, when they should be looking for problems to solve. Customers pay for solutions, but there is no market for ideas. I’m often approached by people with a “million dollar idea,” but I haven’t seen anyone pay that for one yet.

Equally often, I see startups who are on the road to implementing an idea, but haven’t figured out what problem it solves – the business plan waxes on eloquently for 20 pages about how great this product and technology is, but never gets around to defining the problem (investors call this the “solution looking for a problem” syndrome).

A related “red flag” in a business plan is a missing competitive analysis section, or a short paragraph that essentially says, “this product has no competition.” My reaction is, if there is no competition, then there is no market demand for your product, so why are you building it?

Luckily, many startups are smart enough to keep morphing their idea, until it finally fits a real-world problem, and they can move forward in the marketplace. Unfortunately they could have saved themselves much lost time, money, and heartache if they had just focused on identifying the problem before they built a solution.

Smart startups also don’t forget that startup ideas are solutions for someone, and companies have to make money. The way to make money is to make something people or companies need (not necessarily what they want). Here are five solutions from a classic essay by Paul Graham on “Ideas for Startups” that I believe have even more potential in today’s fast changing environment:

  1. Automate a labor intensive process. This is the traditional realm of computers. Microsoft Excel applied it to accounting spreadsheets, and Google applied it to information mining on the Internet, but Henry Ford even applied this principle to auto manufacturing. There are still millions of these opportunities for startups out there.

  2. Fix something that’s broken. In business, it seems to me that the traditional banking business models are broken or at least no longer fit the purpose. On the other end of the spectrum, Internet dating sites don’t seem to work. There are new ones sprouting up every day, so they must be offering something people want. Yet they work horribly, according to most people who have tried one.

  3. Take a luxury and make it a commodity. People must want something if they pay a lot for it. Yet most products can be made dramatically cheaper as technologies improve. This opens the market opportunity, you sell more, and people start to use it in different ways. For example, once cell phones were so cheap that most people had one, people started adding functions and using them as cameras and Internet devices.

  4. Make something cheaper and easier to use. Making things cheaper means more volume and more profit. For a long time making things cheaper made them easier, but now even cheap things are too complicated. Computer applications today are cheap, but often still impossible to use.

  5. Take a current solution to the next level. Solve the currently intractable problems that impact all of us. Tackle the global warming problem, predict where earthquakes will occur, find alternative energy sources, cure cancer, and unlock the keys to aging. There is no shortage of opportunity here.

Combine these with the value of a good understanding of promising new technologies, and the value of having associates with complementary skills to extend your thinking. Problem solutions are the ingredients that startups are made of. Start solving a problem today that you can use as the basis for the “idea” for your next startup.

Marty Zwilling

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Saturday, April 15, 2017

4 Ways To Make Profits Part Of Your Growth Strategy

money-profitsA question that I still hear debated often is whether a new startup growth strategy should focus on user count or profits. First of all, the glory days of “dot.coms” are gone, when investors “didn’t care” about profitability, and all the big money was focused on user count growth.

In the long run, everyone wants both profitability and user growth, but the question is which comes first. Most startups and investors I know don’t have unlimited funds, so the first question they should ask and do ask today, is “When is your company going to be profitable (self-sustaining)?”

Of course, growth is implied in that equation, and is also required for maintaining a sustainable competitive advantage. The challenge is not to undermine growth by a blind focus on profits. You might sell one of two of your widgets for $1 million each, entering profitability immediately, but then die because you can’t grow sales at that price.

I think you will find that most investors will relate to the following strategy for keeping the right perspective and getting the profit versus growth balance right:

  1. Pick an idea that has the potential to make money. That means it solves a real problem for real customers who are ready and able to spend real money. The number of current potential customers is large and growing. Solutions that may be viewed as “nice to have” or “satisfies a higher-level need” won’t get funded.

  2. Design a product or service that you can sell. Sure, you may need to give the product away for free to get traction, but assume you will have to sell something someday to get profitable and stay alive. MySpace, for example, launched in 2003 and boomed for five years without a revenue model. When their deep pockets went empty, Facebook stepped in, but demanded revenue from ads. MySpace wasn’t ready for this, and it soon faded. Don’t count on finding investors supporting growth alone on your new startup.

  3. Build a business plan for profitability in your lifetime. This simply means you need to be sensitive to costs, revenue projections, and a timeline, such that there is light at the end of the tunnel. Most Internet businesses should show profitability in two years, while new medicines may take ten years to pass FDA and other safety tests. Investors will look at competitors in your industry for the norms.

  4. Identify the total investment required for profitability. A very common mistake of early stage startups is to request a small investment to get started. They are usually thinking only of costs required to get “in business,” rather than the total costs of marketing, scaling up, and going international. Be ready to answer the investor question “Is that all you need to get profitable?”

So unless you are building a non-profit, I say focus on profit all the time, every time. Of course, growth is implied in every focus, and profit enables growth. But some of you will surely say “What about Facebook and Snapchat, who focused on growth first and are clearly successful?” So let’s take a look.

Facebook is indeed the largest growth site on the web, with more than two billion user accounts, all free. Yet it took almost six years to become profitable, with revenue only from advertising. What most people don’t realize is that the total outside funding to get it there is estimated at over $800 million, which is a bit more than you will get from any Angel investor.

Yet I can’t argue their success in the value proposition, since they turned down a billion dollar offer from Yahoo way back in 2006, and their market cap today is around $400 billion. It has taken some very deep pockets to get to this point, so now you know why I smile when you tell me your plan emulates the Facebook model. Even Snapchat is now trying hard to generate revenue.

I’ve heard all the arguments that a push for early profits on new business models will lead a company to fall back to a lesser model that provides short-term results, but short-circuits risk-taking that could lead to more long-term value creation. That’s a great argument if you have unlimited funding, but if you are just one of the “rest of us,” I suggest you focus on getting to cash-flow positive first.

Marty Zwilling

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Friday, April 14, 2017

8 Principles For Building A Competitive Core Business

Facebook-Mark-ZuckerbergMany new business owners I know have learned the hard way that you can never be everything for everyone. As a startup, you need to use your limited resources to excel at a few core things for your best customers, in order to stand out and get the momentum going. Focus on a few key principles is the key to success, and it takes discipline and determination to make this happen.

I found some good lessons in this regard in a new book, “Becoming Facebook,” by Mike Hoefflinger, the former Head of Global Business Marketing at Facebook. He talks in detail about ten of the key challenges that Facebook faced in their growth, to move from a tiny social media upstart to one of the most successful companies in the world.

Based on my experience advising new businesses, all of the principles that he outlines, including the following subset which I generalize here, should be taken to heart by every entrepreneur:

  1. Give customers fewer things that matter more. Your customers’ biggest need is not for more things. Your best strategy is to find more customers that fit the things you do best, rather than building more things. Too many choices confuse all customers, and make your job in marketing, distribution, and support much more difficult. Less is more.

  2. Pick a single metric that is the focus for all growth. Today’s world is full of metrics leading to business growth, including customer logins, revenue per customer, retention, and average solution price. Facebook’s winning strategy was a laser focus on increasing active user counts and time spent online. Revenue and competitive position followed.

  3. Speed is a key feature in every customer experience. Customers today have adapted to a fast-moving world, and they expect every business to keep up. They have no understanding or patience for extra steps and delays caused by bureaucratic processes, disengaged employees, complex networks, or software usability problems.

  4. Strive to cross the chasm from early adopters to mainstream. Many new companies become bogged down with the more vocal early adopters, who have an appetite for more function and new players. The mainstream majority want simplicity and base function, and we they get it they will come in droves, and be very reluctant to jump ship. Get there.

  5. Disrupt your own success before someone else does. In this age of technology, the advent of a better alternative is inevitable. To retain the initiative – especially when you’re winning – shape the disruption through your own moves instead of falling victim to those of others. Waiting for the crises of customers often means an impossible recovery effort.

  6. Maximize employee engagement by fitting roles to strengths. Employee engagement starts with looking beyond experience, to talent, determination, results, and a fit to your company values and culture. On an ongoing basis, engagement requires a focus on motivation, match to strengths and interests, and active career planning.

  7. Take care of business, but always play the long game. For many companies, the long game is choosing the right strategic partners and acquisitions. For others, including Facebook, it is penetrating China despite political constraints, and India, where only thirty percent of the population is on the Internet. But never take your eye off today’s customer.

  8. Getting acquired or going public should be a result, not an intent. A focus on looking good as an acquisition or IPO candidate has undermined many startups. Zuckerberg had so much confidence and determination to stay independent that he turned down an early $1 billion offer from Yahoo. Now Facebook’s market cap is nearly 500 times that number.

Facebook may seem like an overnight success, but in reality it faced the same challenges as any new business, including existing well-known social media competitors like MySpace and Friendster. Facebook competed against the model of free customer use paid by advertisers of Google, and the sophisticated data delivery infrastructures of YouTube and Netflix.

I’m convinced that the lessons outlined here can help you become the next Facebook in your business domain. How many do you already practice today?

Marty Zwilling

*** First published on Huffington Post on 04/12/2017 ***

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Wednesday, April 12, 2017

7 Keys To Loving What You Do And Doing What You Love

smilie-do-what-you-loveIs it possible to be successful in business and not fulfilled? The answer is a resounding yes today, and I’m convinced that it will be even more true tomorrow, as young idealistic entrepreneurs try to adapt to the long-standing business culture if success is only measured in the money you make for yourself and your business.

That isn’t very fulfilling to the growing number of entrepreneurs whose vision and satisfaction comes from making the world a better place, and enjoying a leisurely lifestyle with friends and family. In fact, it’s already a problem with more successful entrepreneurs than you know, based on the classic book by serial entrepreneur Brian Gast, “The Business of Wanting More.”

As I have also seen in entrepreneurs, he outlines how he and others have failed to move from success to fulfillment, and offers the following points as guidance to make sure you don’t follow in his footsteps. His perspective is from later in his career, so I’ve re-arranged these a bit for those of you at an earlier stage:

  1. Create a vision for your life early. To create a vision, you simply have to envision yourself enjoying the fruits of your dreams, goals, and principles. Write down the “what” of your vision, but let go of “how” it will be achieved; you can’t control the precise manner, form, or timing. Maintain some reality by listing vulnerabilities, risks, and costs.

  2. Draw a road map to the future you want. If you have no strategic plan, your emotions and opportunities of the moment, or someone else, will drive your decisions and actions. A truly fulfilled life means meeting the four core needs: acceptance, connection, purpose, and service. It’s vital to have a specific plan for meeting those needs.

  3. Take a fearless inventory of your life now. Fulfillment is a choice. After honestly assessing what’s working and not working now in your life, you have to take personal responsibility for all of it before you can empower yourself to effect change. Don’t wait for a personal crisis to highlight gaps – use your strengths now to focus on fulfillment.

  4. Burst your bubble. Your bubble is a lens through which you unconsciously interpret every experience, set by your background, family, and long-standing beliefs. It limits your view of opportunities and actions in yourself, and in others. To the degree that it’s inconsistent with your vision, you need to burst the bubble to act and think outside of your pre-set boundaries.

  5. Build your support team. Go-it-alone leaders are common in startups, but they often crash if they don’t build effective support along the way. Brian defines an effective Court of Support as one professional coach, one accountability partner, one mentor, and six to nine group members. Look for a mix of talent and balance in your support team.

  6. Methodically remove the barriers to fulfillment. Develop your inner CEO to make decisions informed by all areas of your life – not just your career and finances, but also your relationships, core needs, and the needs of others. Beware your shadow and the risk-averse side of your being, which cause you to overreact and behave in ways not conducive to fulfillment.

  7. Create a positive personal practices regimen. Being fulfilled, and staying fulfilled, takes work. It takes a personal regimen to create and sustain a life fortified against the distractions of a culture that relentlessly promotes material success. Focus on practices that help you stay open and have faith, but don’t force it. Don’t be afraid to take test drives.

Following these steps early and always in your career will allow you to be the entrepreneur you want to be with a whole-life view. You will be able to tap unused skills, create better ways to respond to high-stress situations, while still generating more powerful results. Most importantly, you will be able to stay on the road to fulfillment, as well as success.

The best evidence that you are on the road to fulfillment and success is that you love what you do. When you love what you do, it’s not just self-evident, it’s evident to others. You don’t think of your career as going to “work” every day. How many of you can say “I strive to do my best at what I love to do?” Fulfillment and success need not be mutually exclusive.

Marty Zwilling

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Monday, April 10, 2017

8 Keys To Moving An Idea From A Product To A Business

Puppets-Bill-Gates-Steve-BallmerMany aspiring entrepreneurs are jealous of inventors, thinking that new inventions are the key to new ventures. In my experience advising startups, I have found that the invention is usually the easy part, and the hard part is turning the invention into a business. It takes a special kind of person to turn an idea into a business, with strengths often opposite those of an inventor.

In my view, that’s why “two heads are better than one” in starting a business – one with the passion and skill to create an innovative solution, and the other with a business savvy, customer focus, and the ability to build and lead a team. If you think you are one of those rare few who can wear both hats, check your fit against the following requirements:

  1. Perseverance in business trumps solution excellence. Even the businesses you might think of as overnight successes, including Facebook and Google, took six years or more to get there. Too many inventors I know spend their six years or more perfecting the product, and give up in desperation if the business doesn’t then take off overnight.

  2. Don’t expect the world will find you due to your invention. Good business people are pragmatists. They realize how hard it is to even get anyone’s attention in the world of the Internet today, with over 100,000 new businesses starting every day worldwide. They keep their priority on communication, marketing, and an innovative business model.

  3. Building a business is a team effort. You may be able to invent a product alone, but a business requires partnerships, multiple disciplines, and loyal customers. Nothing about a business is rocket science. It requires relationships, trial and error, and constant change to keep up with economic challenges, culture evolution, and new competitors.

  4. You need a tough skin and resilience to survive and prosper. Inventors and creative people often have large egos, and hate to fail or be criticized. On the business side, you can’t learn and pivot without feedback, both positive and negative, from customers and stakeholders. The best entrepreneurs wear their failures like badges of courage.

  5. Selling yourself is more important than selling your solution. Businesses are driven by your team, investors, partners, and most of all, customers. They all need to see you as a trusted associate who shares the same values, more than an expert who can dream up solutions. As a new business, you are the brand before you have a product.

  6. Repeatable processes or required to scale a business. No matter how innovative your invention, it won’t sustain a business unless it can be built and sold in volume by ordinary people in multiple environments. Inventors don’t always appreciate documented processes, quality controls, and metrics. The business has to evolve as it scales.

  7. Ability to accept responsibility for factors outside your control. It’s easy to blame product setbacks or the economy, lack of investors, team failures, or customer apathy, but blame doesn’t fix anything. Good business people learn from every setback and find strength and satisfaction from overcoming or dodging challenges they didn’t create.

  8. Enjoy the journey as well as the destination. If your vision as an inventor is that glorious product, or the gold at the end of the rainbow, it may be short-lived or a long time coming. Building a business is a long-term process of “making meaning,” helping people one-by-one, and overcoming obstacles that you never dreamed of when you started.

There is no doubt that an invention is a good start in business, but it’s only the beginning. If you define invention success as a large constituency using the solution, or large financial returns, that requires a sustainable business. In your new venture, make sure you have with all the right attributes. That usually means surrounding yourself with the right people, rather than trying to stuff it all into one head.

Marty Zwilling

*** First published on Inc.com on 03/27/2017 ***

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Sunday, April 9, 2017

7 Tips On Maximizing Social Media Returns At Low Cost

social-media-returnsIf you are an entrepreneur today, and not using social media to promote your business, you are missing out on a huge opportunity. But, contrary to what most people preach, it isn’t entirely free. Most social media outlets don’t require a subscription charge, but they certainly always require an investment, sometimes large, in people, in technology, your reputation, and your time.

There are hundreds of consultants out there who will take your money for guidance in this area, but I recommend that you start with some free resources on the Internet, or one of the many recent books on this topic. One of the classics, “How to Make Money with Social Media” by Jamie Turner and Reshma Shah, Ph.D., hits all the right points from my perspective:

  1. There are risks as well as benefits. As with many startup activities, you only have one chance for a great first impression. You can jump into social media with a poor brand definition, poorly focused content, unrealistic expectations of customer service, or be killed by malware or viruses.

  2. Assess social media relevance to your product or service. If your business is industrial B2B products, social media should be low on your list. Spend your time and money on other platforms. If you are selling to consumers, especially younger ones, your business won’t survive without an effective social media presence.

  3. Attracting key stakeholders requires sensitivity. For some customers and many investors, a heavy focus on social networks and viral marketing may be a negative, rather than a positive. A balance of conventional and social communication and marketing is always advised.

  4. Pick the right platform for your business. Within each of the platform categories defined above, there is a right one and a wrong one for your audience. For example, LinkedIn is attuned to business professionals, Facebook is dominated by the social and upwardly mobile crowd, and Instagram leads as the top social media app for teens.

  5. Communication and writing skills are required. Heavy texting experience is not a qualification for communicating via social media. In additional to strong journalistic writing and storytelling, you need business acumen, strategic thinking and planning, and the ability to do the right research. These days, video production is also a useful skill.

  6. Make social media an integrated part of an overall strategy. An integrated marketing strategy starts with an overall brand management strategy, delivered through online and offline communications, promotions, and customer engagement vehicles. Your Twitter and YouTube messages better match your print advertising message.

  7. Find the right tools to analyze the ROI. Return-On-Investment metrics are not new, but the tools are different. Get familiar with current social media tools, such as Google Analytics, Kissmetrics, and HootSuite analytics. Over time, put together the data you need to measure your progress on a weekly/monthly/yearly basis.

The key social media platforms today include communications (Wordpress blogs, Twitter), collaboration (Evernote, StumbleUpon), and multimedia (YouTube, Flickr). In looking ahead, don’t forget the mobile platforms (iPhone, Android), and location-based services (Foursquare, Pokemon Go).

As with any resource or tool, you need to optimize your social media costs against a targeted return. That means first setting a strategy and plan for what you want to achieve, then executing the plan efficiently, and measuring results. It’s not free, but it’s an investment that you can’t afford not to make.

Marty Zwilling

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Saturday, April 8, 2017

7 Partner Relationships That Can Kill A Good Startup

entrepreneur-partner-conflictMost entrepreneurs who start a company alone soon come to the conclusion that two heads are better than one – someone to share the workload, the hard decisions, and the costs. In a moment of crisis, you may be tempted to take on the first person expressing interest as a co-founder. This would be a mistake, and could easily cost you your startup.

If you think about it, you should realize that not everyone is ‘ideal partner material.’ Most of us learn that fact from other partner relationships, like dating and marriage. First you have to be clear on who you are, and who you can co-exist with, what complementary skills and resources you need, and what decisions in the business you are willing to relegate.

Second, in your search for partners, you need to be aware of the many considerations that can make the difference between success and failure in the business, as well as your satisfaction with the relationship. Bringing money and connections is great, but other less tangible things can rip the business apart. If you catch yourself thinking any of these thoughts, it’s time to re-think:

  1. “Let’s keep it in the family.” On the surface, this seems like a great strategy, with a “share the pain, share the gain” outlook, or just cheap labor. In reality, the pressures of a relationship break up more startups, or vice versa, than running out of money. Investors routinely decline to fund co-founders who are siblings, or in a romantic relationship.

  2. “We both have the same vision.” There is usually only room for one in a vision. Even if the endpoint is the same, there are many different roads to get there, and it’s hard for a startup to be on two roads at once. It works much better when one partner is the visionary, and the other is the pragmatic “get it done today” kind of person.

  3. “All decisions will be made jointly.” Two people making a decision need a tiebreaker, and three or more take too long. There is certainly no problem with each partner making decisions in his area of expertise and responsibility, but one has to be in charge. VCs routinely ask “Who is the final arbiter?” and the answer better not be ambiguous.

  4. “We are so alike, we finish each other’s sentences.” You really need a partner who is complementary, and can tackle the operational roles, like marketing, finance, and sales. A partner who is a carbon copy of you will likely mean two people working on every problem, rather than a natural separation of duties. Most startups can’t afford that.

  5. “Our work styles are different, but our goals are the same.” Some people are early risers and expect to tackle the tough problems early in the day. Others don’t get rolling until noon, and save the hard discussions for after dinner. No problem when things are going well, but in the hard times, emotions go up and communication goes down.

  6. “We have different values and ethics, but share a passion for this business.” Partners who don’t share a common regard for regulations and boundaries are doomed to high levels of stress and frustration. Some people like to live just over the limit, while others have a high sense of integrity and morality. It usually doesn’t work.

  7. “I’ll put in the money, if you put in the sweat equity.” I’m not suggesting that co-founders should be equal contributors on both sides, but the parameters for “equality” better be well understood and well documented. Things happen, memories change, and soon both sides feel under-appreciated and over-utilized.

We all know of some relationships that seemed mismatched, but worked out well, so the real test is the test of time. Just as you should take some time to explore if your love interest would make good marriage material, I encourage you to take some time to explore if your fellow entrepreneur would make good 'partner' material. Avoid ‘whirlwind’ business partnerships.

In all cases, once you have decided that it’s time to seal the deal, be sure to establish in writing your working agreement, as well as ownership shares. Only then is it time to celebrate and look for Angels on your way to heaven.

Marty Zwilling

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Friday, April 7, 2017

5 Steps On The Success Path For Every Small Business

success-small-businessEntrepreneurs always work hard to create an innovative product or service, but often count on standard seller marketing for sales. But the reality is that sellers are no longer in charge of the customer buying process. Reports suggest that 90% of today’s shoppers skip marketing pitches, to research online before they buy, and over 50% check user reviews before making a decision.

The Internet and smartphones have changed everything. Kristin Zhivago, in her classic book “Roadmap to Revenue,” makes the point that the selling system is broken, since sellers no longer sell the way customers are buying. Here is my rendition of how her roadmap can keep you on the right track, like Xerox Data Solutions, with a “customer-centric” approach rather than a “company-centric” approach:

  1. Find out what customers want and how they want to buy it. The best way to do this is with real customer interviews. Customers will tell you things when being interviewed, such as their need to improve operational workflow, which they will never tell you while you are selling to them. She recommends phone interviews by you, by appointment, with structured questions, and you document results.

  2. Debate and adjust your offering to better match what customers want. Distribute an Executive Summary and Recommendations report, as well as transcripts of your interviews, to all the key players in your company. Schedule and run the necessary sessions to update strategic product offerings, processes, and marketing programs.

  3. Align your business model to how your customers want to buy. Don’t start from how you want to sell. Start with a new understanding of real customer solutions needs, their search process in finding you (referral, website, social media), and most desired payment model, like one-time payment versus subscription, or lease versus purchase.

  4. Integrate the customer buying process into your support operation. Decide which parts can be automated, people resources required, and professional support services required. All of these processes should be documented, and should explicitly include the customer buying process and perceptions as the base. Their perception is your reality.

  5. Build and deploy a revenue growth action plan. This is your rollout of the new product offerings, business model updates, and process changes to map to the new understanding of the customer buying process. Include planned measurements and metrics. Start where the customer wants you to be and work backwards.

As you start making the shift to customer-centric, if your team doesn’t “get it,” then you haven’t communicated effectively. Communicating change is always hard, so pay careful attention to the central message, repetition opportunities, and “walking the talk.” People are quick to make things up to fill a vacuum, and rumors or myths die hard.

Make sure your own motivation is strong, and don’t let anyone view these efforts as a one-time push. It has to be managed and sold internally as a culture change, requiring everyone’s help. Experience has shown that the best way to change a process is to set up the new way of doing things, then flip the switch (flip method), rather than making incremental changes (drip method).

Every business needs to take advantage of the new tools and technologies which can assist you in making this shift in strategy and measuring effectiveness. These range from basic search engine optimization (SEO) tracking, like Google Analytics, to a new generation of marketing platforms, like HubSpot.

There are multiple benefits to both you and your customer. The customers will get what they want, when they want it, and you will see more revenue, greater brand loyalty, real relationships, and a competitive edge. That sounds to me like the recipe for business success that every entrepreneur and investor is looking for.

Marty Zwilling

*** Published by Xerox Small Business Solutions on 04/06/2017 ***

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Wednesday, April 5, 2017

7 New Business Realities Challenging Every Business

group-internationalEven small business have a global reach these days, thanks to the Internet. Thus every entrepreneur and business owner needs to see their market in that context, understanding the global forces that will impact them sooner or later. This impact can be positive, as a huge untapped opportunity, or negative as a global competitor invades your local space.

According to Small Business Trends, over half of the existing small businesses in the US already have international customers. I can assure you that percentages of foreign companies looking here is even higher. It’s more than competing with giants like Amazon and Alibaba, your business in downtown mid-America can easily be crushed by a similar company on the Internet in Europe.

In this fast-paced world economy, it’s time for every entrepreneur to pay attention every day to some key forces in the world, outside of their own business, which can present huge challenges, as well as huge opportunities. These include the following:

  1. New generation gaps and demographics emerge. The needs of Millennials (Gen Y) and the new Gen Z are changing the needs as well as the culture. Luxury goods can easily flow into or out of emerging nations, changing cost factors as well as demand. Every business, small or large, needs to focus on agility and their ability to innovate.

  2. Technological innovations disrupt stable markets. I was just recently reading about the emergence of passenger drones for people commuting in China. This has the potential for disrupting every auto-related business anywhere in the world. This kind of disruption used to happen only a few times per century, but now it is commonplace

  3. Customer and employee power trumps stakeholders. In the new world economy, the power is shifting in many parts of the world from shareholders and owners to customers and employees. New business models may be required, new team benefits considered, and a new focus on customer relationships implemented. Use two-way communication.

  4. World economic and political connections evolve. No nation or local business is an island. Today’s hyper connected people through social media, and linked economies through global finance cause even tiny country woes to ripple quickly through businesses around the world. These ripples can be opportunities or catastrophes for any business.

  5. Sustainability and environments become critical. Global warming and renewable resource considerations are major opportunities for new business, or forces which can kill your existing business. Going green is not an automatic qualification for funding and growth, but a focus or sharing of your profits can easily be a competitive advantage.

  6. Cultural movements and a societal focus emerges. Eliminating poverty, improving education, and financial literacy are issues that can no longer be separated from business. Culture changes can increase or decrease demand for existing products and services quickly. Interact on social media to sense trend impacts on your business early.

  7. Translation and localization become highly valuable. We now more often see “reverse innovation,” where customers in developing countries adopt new technologies first. Examples include smart card adoption where there were no credit cards, and cell phone coverage emerging before land lines. Translation costs go down every day.

To address any or all of these on a timely basis, you need a team that is flexible, innovative, and resilient. Such a team can best be built from the start – it’s hard to retrofit the required culture into a company staffed by people are not looking to change, and remember how things have always been done. The team has to really believe in listening to the customer, and responding quickly.

Smart business leaders accept these challenges as the new facts of life, and are energized by the potential, rather than overwhelmed by the implications. They envision their business as part of the global stage, even if their focus is only on a niche business. How familiar are you with the global implications around your business, and how ready is your team to playing on that stage?

Marty Zwilling

*** First published on Inc.com on 03/21/2017 ***

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Monday, April 3, 2017

Why Mentors Are Needed To Spark Future Entrepreneurs

Urban_to_Rural_MentorsAs a long-time mentor and advisor to new business owners, I can attest to both the need for mentoring, and the satisfaction that comes from watching an aspiring but tentative entrepreneur grow into someone capable of changing the world. Business is not rocket science, and one-on-one guidance face-to-face, with a real project, trumps the classroom and mistakes every time.

In addition, mentoring is one of the most productive roles I have found as a member of the 78 million Baby Boomers otherwise entering retirement age. I can’t think of a better way to empower experienced business professionals, whether they are executives, engineers, accountants, lawyers, or bankers. It’s a win-win situation for everyone in this new age of the entrepreneur.

I just finished a new book, “Teach to Work: How a Mentor, a Mentee, and a Project Can Close the Skills Gap in America,” by Patty Alper, who has been mentoring for fifteen years. She provides a detailed guide on how to get started as a mentor, how to have the greatest impact, and enjoy the role at the same time. Here is a quick summary of the lessons she offers for all of us:

  1. It’s an opportunity for give-back and pay-forward. I have enjoyed some success in business, but I would hate to think that everyone has to make all the mistakes I did to get there. Every professional I know has plenty to contribute, and enjoys the give-back as much as the learning. Those who learned from others first really enjoy paying it forward.

  2. Everyone finds meaning in new win-win relationships. The new generations in business, and even the old ones, believe that relationships get things done, more than skills learned in school. Building relationships, and finding ways for a win-win, is what mentoring is about. Good business relationships make better teams and customers.

  3. Face-to-face mentoring generates more inspiration. Entrepreneurship and business leadership requires passion, confidence, and creativity. Working directly with a mentor provides a depth of communication, through body language as well as personal focus, that is much more likely to provide the required inspiration compared to classrooms.

  4. Real-life projects incent high learning and retention. Business is not predictable, and there are no answers in the back of the book for most situations. Real projects and actual ventures are the best way to incent thinking outside the box, teach that mistakes are just learning vehicles, and focus on problem solving and innovation as the keys to success.

  5. Mentoring pitches turns students into communicators. Mentoring is really a lesson in two-way communication, required for every business transaction. Aspiring entrepreneurs learn to talk in front of others, sell their ideas, and be judged. They learn resilience and confidence, as well as how to show respect for investors and customers.

  6. Smart companies use mentoring to find future talent. Today, leading companies including Starbucks, Zappos, and Ernst & Young, are finding that mentoring is a great corporate social responsibility focus, as well as a way to find and train future talent. It’s another example of win-win, for the business as well as the mentees.

  7. Mentors learn about culture changes and new generations. When I am mentoring, I’m always surprised at how much I learn about how people think today, and what I can do to work effectively with them as team members and customers. One of the challenges we all have is cross-generational understanding. It’s hard to learn that in school.

In my view, this type of mentoring is a missing link in our education system today between schools and businesses. It’s bringing back a bit of the paradigm of the master tradesman in the European guild system mentoring journeymen before they stepped out on their own. Today we need it to improve engagement, confidence, and work satisfaction for all business professionals.

We need to close the Gallup poll gap between the 98 percent of academic officials who are confident they are preparing students for success, versus the 11 percent of C-level business executives who strongly believe that college graduates have the skills they are looking for. Entrepreneurs are our next generation of C-level executives. Let’s make sure they are ready.

Marty Zwilling

*** First published on Huffington Post on 04/02/2017 ***

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Sunday, April 2, 2017

10 Ways To Win With Multiple Concurrent Businesses

Franck_Nazikian_ _Dave_McClure_ _Net_JacobssonWith the cost of entry at an all-time low, and the odds of success equally low, more and more entrepreneurs are starting multiple companies concurrently. This “parallel entrepreneur” idea has been around since at least the days of Thomas Edison, and for the new generation of entrepreneurs, who have been multi-tasking since birth, it’s probably not even a stretch.

Some entrepreneurs, like Paul Graham of Y Combinator, and Dave McClure of 500 Startups, mask their focus on multiple startups by running an incubator or accelerator, and providing seed funding for a number of individual efforts. They skip from one to the next, providing expert guidance and money, getting their satisfaction (and reward) from the best of the best.

For entrepreneurs who really try to be the CEO of multiple early-stage startups concurrently, the hot new term for this practice is “multi-table” entrepreneurs. I suspect this term is derived from the common online gambling practice of playing multiple poker games at the same time. In fact, I think that’s a great analogy, since the odds in a poker game may be similar to those of a startup.

Yet there are clear advantages to the parallel approach, if you have the moxy, resources, energy bandwidth, and the ability to multi-task effectively:

  1. A portfolio approach versus all eggs in one basket. Investors have long argued the value of a portfolio to hedge and leverage the risk, so why shouldn’t entrepreneurs do the same? With the current low capital requirements for smartphone and Internet apps, and high market volatility, it makes sense to spread the risk around as much as possible.

  2. Optimize your advisers and investors. Advisors and mentors are busy people. In your weekly meetings, it’s as easy to cover multiple company issues as one. Investors building their portfolio love to hear about multiple startups in one sitting, to select the best fit. Investors look at the people first anyway, so a strong team is good common ground.

  3. Many entrepreneurs love investing in other startups. Most Angel investors I know have previously founded and run at least one startup. Both these roles require unique skills, but both can benefit from operating in the other mode. Multi-table investors are the norm, and the investment process is good training for multi-table entrepreneurs.

  4. Learn to manage resources like multi-divisional corporations. Allocating resources, financial and operational, between divisions has long been a strategy for conglomerates, and can work just as well for savvy entrepreneurs. Revenue from one startup can be “invested” in another, and assets like buildings and computers can be shared.

  5. Attract and share specialized talent and skills. It’s very hard to attract talented people to a single product startup, but much easier if the entrepreneur has a bigger vision, with several entities producing complementary products. Expensive “lean startup” specialists can see a career potential, work full-time, and drive multiple successes.

  6. Cross-fertilization from current market feedback. One thing that you learn in one company, at a given moment in time, is equally valuable or leveragable in a different way at your other companies. As your customer list grows in one, you own it for the second. The cost of finding new markets can now be split among multiple entities.

  7. Foster and enforce the art of delegation. For long-term success, every entrepreneur needs to know when to step in, and when to delegate. That’s a skill that may not get enough attention until too late by a single startup entrepreneur. With parallel startups, delegation is a requirement for entry, and a valuable skill for all environments.

  8. Multiply the pay-back. Many parallel entrepreneurs have already achieved financial security through earlier efforts. Now they may see a way to multiply pay-back and spread the risk by active involvement with multiple startups. Of course, it’s like a double-down in gambling as well, which can quickly turn into a double loss.

  9. Products need not be tied to a given company. With open-source tools and public APIs, every product is no longer owned by a given company. The company entity is now primarily used to allocate ownership, accountability, and tax consideration, and need not be bound to a given product or operational structure.

  10. Burns off high energy and bandwidth. Now we are back to the fact that there are people who love to multi-task, and anything less is simply boring. This is especially true of Gen-Y entrepreneurs, with fire in the belly to change the world. Some see startups as a lottery where more tickets mean a higher probability of winning.

Of course, there are huge risks when you try to ride multiple horses at one time. At the very least, you may not do either well, or won’t be fully there when the going gets tough. Even single entrepreneurs who maintain a day job, for a steady paycheck, feel the pain of juggling multiple initiatives.

The hard part is getting the management part right. Every startup has to have someone minding the store, and a clear path to “the buck stops here.” No one can be a full-time CEO and work “in” the business of multiple companies. Plus there is the challenge of making sure the multiple roles do not conflict, legally or otherwise. Tread carefully there.

The most common way people move into the parallel entrepreneur environment, if they are so inclined, is to start another one, while still exiting the current one. The risk here is that winding down one takes much longer than you would expect, and starting something new consumes more energy than anyone predicts.

Overall, for the first-time entrepreneur, my sense is that trying to focus on more than one equally exciting idea is a recipe for failure. But with the cost of entry going down, and the multi-tasking bandwidth of each new generation going up, I suspect parallel entrepreneurs may soon be the norm rather than the exception. Are you ready to step up to this table?

Marty Zwilling

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Saturday, April 1, 2017

7 Keys to Positive Results Utilizing Social Media

Social-media-stepsMost startups, and many big businesses, still don’t have a clue on how to use social media productively for marketing their business. They randomly churn for hours a day on a couple of their favorite social media platforms, with little thought given to goals, objectives, or metrics; and ultimately give up and fall back to traditional marketing approaches.

The first thing that entrepreneurs need to realize is that the process and framework for making social media marketing work are different from traditional marketing, and trial and error certainly doesn’t work. Ric Dragon, an expert in online marketing, in his classic book. “Social Marketology,” outlined the best set of steps I have seen so far for the new world:

  1. Focus on desired outcomes first. Valid social media objectives for a business should include one or more of the following: increased brand awareness, lead generation, service and support, or reputation management. Obviously, the platforms and how you use social media would be different for lead generation versus service and support.

  2. Incorporate brand personality and voice. Popular culture these days expects a more humanized brand voice, and constituents are listening carefully to the tone, vision, and expertise of that voice. Think about how you can project the voice you want, and make sure it is consistently used by all team members across all platforms used.

  3. Identify the smallest segments possible of your constituents. Due to the information overload felt by consumers today, marketing at the generic segment level no longer works. Social media is the only one which allows you to be hyper-granular and drill down to micro-segments, to dramatically improve engagement levels and conversion ratios.

  4. Identify the communities for these micro-segments. Traditionally, community implied a physical grouping, but today a community is characterized by what they value, more than proximity. More important than finding a community, is creating one, with your blog and other social media engagement. The best communities then become your advocate.

  5. Identify the influencers of these communities. Social media brings all the aspects of important influencers these days, including peer pressure, authority, credibility, and in some cases, celebrities. Because feedback from social media operates in real time, you don’t have to wait months for results. You spend the months influencing the influencers.

  6. Create an action plan with metrics. Good action plans include a listening plan, channel plan, SEO plan, and a content creation plan, with activities and metrics. Social media activities span the gamut from curation to gifting, building relationships and groups, blogging, service actions, to lead conversion. Pick the ones that fit your desired outcome.

  7. Iteratively execute and measure results. Measuring is all about return-on-investment (ROI). This can be customer acquisition cost, revenue growth, profit, or whatever other parameters are key to your success. Iterate and expect to pivot, based on results, because you can’t get it all right the first time. This is not trial and error.

In fact, marketing in the social media is fundamentally different from conventional marketing. The depth in which connections can be made with the “audience” or “customers” is far greater than it possibly can be with any other medium. The very nature of influence at this level mans that values and vision must be in tune.

Of course, with social media marketing, trial and error is not the only way to fail. You can fail by not being there at all (see the United Breaks Guitars story), or making a big mistake (see The 12 Worst Social-Media Fails of 2016).

More positively, social media also brings many more ways to succeed. See some recent examples in the 10 top social media marketing success stories of recent times. It’s time for you to learn the best practices of using social media in your company, and putting them to work before your competition puts you out of work.

Marty Zwilling

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