Monday, December 30, 2019

5 Ways To Engage The Right People In Your New Venture

BusinessPlanPresentationIn my work with new and aspiring entrepreneurs, I find that most struggle with putting together a written business plan, often pointing out that someone they know started a business without anything written down. My experience is that the discipline of documenting a plan will improve your likelihood of addressing all the right issues, as well as finding the right partner or investor.

It’s no secret that the rate of failure of new business startups may be a high as ninety percent, so we all need all the help we can get, validating the opportunity, clearly positioning against competitors, projecting financials, and planning all the necessary marketing and operating activities. I recommend the following short list of deliverables to keep you on a winning track:

  1. Create a new business overview brochure. Starting a new business starts with selling everyone, including yourself, on the viability and specifics of your idea. Just talking and waving your arms doesn’t do it. Most people will be engaged by a single-page double-sided glossy executive summary, and offer support or the right people to move forward.

    Whether you are looking for partners, investors, or future customers, you need to show a level of professionalism and leadership very early that will draw people to your idea. It can pay big dividends as this stage to get help from an experienced business advisor.

  2. Two-minute video highlighting you and your idea. Even people who read will be impressed with a video clip these days, as an introduction to you, showing your passion and commitment, and highlighting your business focus and direction. Be sure to net out the opportunity and the solution in the first thirty seconds. Make it light, but factual.

    For details and examples, check out these directions and suggestions. You really need at least a prototype product or customer to make the video come alive. Think of it as an infomercial. You don't need special lighting or equipment; keep it concise and simple.

  3. PowerPoint pitch for investors and partners. This section is especially important if you intend to attract outside investors or strategic partners. In my experience as an angel investor, the perfect pitch length is ten slides, outlining the business problem, your solution, opportunity sizing, competition, and financial projections for the next five years.

    Remember, investors or interested in acquiring a piece of your company, so keep the focus on the attractiveness of the company, rather than the product. Make sure you can cover all the material in as little as ten minutes – investors are easily bored.

  4. Prepare a business plan 20-page document. No matter how much you enjoy talking, you don’t have time to reach all the people who need to know, with the right level of detail, what you can put in a document. This document must cover all the content discussed earlier, with details to make it come alive without you talking to fill in the gaps.

    If you are an entrepreneur who doesn’t feel comfortable writing, there are many advisors, investment attorneys, and independent contractors who are available to help, for a fee. Review some examples to assure you have all the proper legal disclosures and content.

  5. Validate your financial assumptions with a model. I always recommend the creation of a simple Excel spreadsheet with your projections of revenue, cost, and other major financial elements over the first five years of your new business. You will likely need this work to properly answer potential investor questions, and test your own assumptions.

    The real objective here is convince both you and potential investors that the business is financially viable and lucrative over the long term. There are plenty of guidelines and sample models available on the Internet, so don’t be intimidated by the terminology.

While the completion of all of these items entails a lot of work, I assure you from experience that the results are worth it, to minimize the probability of a serious business failure and bitter disappointment on your part, and the confidence of people who believe in you.

In my years of work with new businesses, I’m more and more convinced that having the idea is the easy part – the real work, and ultimate success or failure, is in the execution. If you want to stand out above the crowd, my advice is to focus early on all five of the business plan elements outlined here, and enjoy the fruits of your labor for many years to come.

Marty Zwilling

*** First published on Inc.com on 12/14/2019 ***

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Sunday, December 29, 2019

5 Keys To Maximizing Your Impact In People Mentoring

Maximizing-mentoring-impactIf you are like most entrepreneurs I know, there just aren’t enough hours in a day to get all your own work done, as well as run the many one-hour meetings each team member seems to demand for decisions and mentoring. I have found it to be more productive and effective to lead with the model that no meetings will take an hour, and may be done in as little as five minutes.

Of course, this requires some discipline and focus on your part, as well as the willingness to trust team members and allow them to do their jobs. For example, you must forego the traditional meeting approach, where a team member presents a slide deck with all the background and multiple solution options on an issue, and asks you for a decision.

I recommend the elevator pitch-approach instead, which you probably learned in dealing with busy investors, where the person calling the meeting is asked to summarize the purpose, value and recommended solution in the first minute or two. That leaves three minutes, or maybe a few more, for you to clarify your understanding, approve their approach or suggest additional work.

Meetings at this level should never be seen as “working sessions” for actually solving the problem, but as mentoring and direction setting for team members. I have personally used this approach in leading startups as well as large organizations, in highly technical roles as well as business development and marketing. But it only works if you observe the following principles:

  1. Never hide from your team. If you are always hard to find, too busy or unavailable behind closed doors, no leadership or mentoring relationship can work effectively. The old principle of managing by walking around will give the background, and people always having to wait makes them talk longer when they get your precious attention.

  1. Listen and adapt your style to theirs. You rarely learn anything by talking. Practice active listening and respond with a simple affirmation, step-by-step instructions or an anecdotal story, depending on the style and experience of the team member. Five-minute meetings cannot be five minutes of anyone talking.

  1. What is said in a meeting must stay in the meeting. Of course, decisions and action items must be communicated immediately, but individual disagreements, comments and recommendations must never surface around the water cooler or in later reviews. You want team members to provide input openly, honestly and without fear of retribution.

  1. Provide immediate direct and constructive feedback. Team members need your critique of their work to learn, but attacking the person is never productive. Use every opportunity to clarify your goals and set the context for follow-on discussions. If you must provide negative feedback, make every attempt to highlight the positives first.

  1. Make it clear that team members are accountable and responsible. Your most valuable team members wouldn’t want to work any other way. Encourage them to come in with solutions, not problems, and empower them to drive their recommendations to success. Everyone learns best from failures, so failure should never be a feared option.

For one-on-one coaching from the startup founder, I call this approach five-minute mentoring. The goal is not to use your time doing the job for less-experienced team members, but instead quickly identifying their barrier to progress, and providing guidance on a next step. Even if multiple cycles are required to reach the goal, you will spend less time, and they will learn infinitely more.

I fully understand that the best entrepreneurs are problem solvers by nature, so this approach requires a mindset change from solving to a specific answer, to coaching on the process, which will pay big dividends for both of you as the company grows. You can be a problem solver and build a product alone, but you can’t build a successful business alone.

Your primary responsibility as a startup founder is to provide vision, leadership and communication to all internal and external team members. Long meetings behind closed doors are draining for you and not productive for the company toward these objectives.

Start today with five-minute meetings and mentoring to get the fun and productivity back.

Marty Zwilling

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Saturday, December 28, 2019

8 Friends Who Mean Well But Never Start New Ventures

business-idea-plan-actionEvery entrepreneur I know is dismayed by the number of friends who approach them with a line such as “I have an even better idea that will change the world, and one of these days I’m going to get around to starting my own business.” I always wonder what is more important to them on an ongoing basis than changing the world, since their startups usually never materialize.

With the cost of entry to be an entrepreneur so low today, the common excuse of “lack of funding” doesn’t get much sympathy from me. People can build great ecommerce sites with free tools, smartphone apps in their spare time and use crowdfunding to bypass the dreaded angel funding and venture capital penalties. There must be something deeper that slows people down.

So if you have a great idea, and funding isn’t an overwhelming challenge, what are the real reasons that the world is filled with so many “wannabe” entrepreneurs that never get around to starting up?

Based on my own experience mentoring real entrepreneurs and likely candidates, there are at least eight categories of non-starters. I’m sure you will recognize someone you know, maybe even yourself, in one of the following groups:

  1. Enjoy the dreaming, but not the implementation. These are people who often call themselves “idea people,” who like to talk about their vision and leave the implementation to some lesser beings. In my experience, there are a wealth of good ideas out there, and the harder part is converting the dream into a profitable business.

  1. Unwilling or unable to acquire business implementation skills. Our culture propagates the myth that business skills, like rocket science, can only be learned in a classroom or lab. In today’s world, with a pervasively connected and constantly updated Internet knowledge base, online self-learning is always available and more productive.

  1. Irrational fear of failure or embarrassment. Everyone has some fear of the unknown, and that’s a good thing for survival. Successful entrepreneurs are ones who overcome their fears and manage some risk and failures as a part of the learning process. Others are debilitated by their fear, avoid risk at all costs, and never start.

  1. Equally irrational fear of dealing with success. We have all seen people on the cusp of success, who seemed to intentionally undermine their momentum, only to fail near the finish line. Of course, too much early success can kill a business, but real entrepreneurs are certain that they can grow and learn from success, just as they do from failure.

  1. Insist on perfectionism, rather than pragmatism. I know very talented inventors who have been working on the same technology for 20 years, and still want to do more research to make sure it’s perfect before selling a product. In today’s rapidly changing market, perfection is a fleeting and impractical objective. Pragmatists create a minimum viable product (MVP), test it in the market and iterate to success.

  1. Unable to maintain their focus and resist distractions. “Focus” is the key to success as an entrepreneur. A business that tries to do too many things for too many markets will likely excel at none and discourage all potential customers. Focus means keeping priorities straight, separating important from urgent, organizing and delegating.

  1. Substitute excuses for accountability and responsibility. Excuses are efforts to rationalize failure after the fact or justification for never starting. The best attribute of a real entrepreneur is acceptance of the fact that “the buck stops here.” There are always alternatives, pivots and creativity to overcome any obstacle.

  1. Simply not a self-starter, leader or decision-maker. These are the products of the industrial revolution, who wait for others to tell them what to do, and love to find fault and play the victim.  When you adopt the entrepreneur lifestyle, it’s up to you to set the pace, stay positive, be the model and lead the follow-through.

If you expect someone else to make your decisions and bear the risks and responsibilities of implementation, then “one of these days” will probably never come for you. So my view of what it takes to be an entrepreneur is simply to adopt the right attitude and full accountability. People who want it bad enough will get around to it. How long will you be a “wannabe” entrepreneur?

Marty Zwilling

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Friday, December 27, 2019

6 Building Blocks Make Amazon A Global Market Leader

Amazon-logoEvery new business dreams of growing from a startup to a global market leader in a few years, like Amazon.com, but that goal is elusive. As a mentor to entrepreneurs, I often get asked for the magic that has made Amazon the world's most valuable brand, from a total unknown only twenty years ago. My simple answer is that they keep their focus on customers, rather than technology.

Thus I was pleased to see the evidence confirming that perspective in a new book, “The Amazon Management System,” by Ram Charan and Julia Yang. They present a convincing story that every entrepreneur has the same potential, but most get sidetracked and bogged down by their technology, competitors, and internal organization. Jeff Bezos has kept his focus on customers.

Of course, it’s never quite that simple, but I really like the authors outline of the six key building blocks that have driven Amazon growth since their early days, to keep their current market value hovering around a trillion dollars. In my view, every startup in today’s world would do well to adopt a management system with the same key objectives:

  1. Start with a customer-obsessed business model. At Amazon, Jeff Bezos leads a relentless drive to invent dramatic new ways to delight customers, not waiting for customer demands or competitors to show the way. These days, speed of delivery, rate of change, and automation are key, so these elements get attention for every customer.

    For example, when delivery costs and delays were still a major online sales hurdle, Amazon Prime membership was invented to offer free next day shipping. It has proven to be a huge customer growth engine, and now has over 100 million members globally.

  2. Practice continuous bar-raising for your talent pool. Contrary to popular belief, I’m convinced that business success is more of function of the right people, rather than the right idea. Amazon extends this concept to continuously and proactively seek better talent as they learn more from results. They find more and better owners and builders.

    In their recruiting process, they actually have a key insider designated as a “bar raiser” involved in ever interview, to make sure that the bar is never lowered due to any bias or pressing business urgency. They help hiring managers raise the bar for every interview.

  3. Incorporate AI-powered data and metrics systems. Jeff Bezos is a man of numbers, and he deals in large volumes, with quick turnaround, so he relies on the latest data technology. While others level off with a certain level of automation, Amazon continuously raises the bar on data analysis, just like they do on talent, and measure the return.

    When they need a new fulfillment center, they pick the best location by simulating all the orders and predicting an optimum location. Their pricing algorithm crawls the Web daily, and adjusts prices to always match the lowest price found anywhere, offline or online.

  4. Make your company a ground-breaking invention machine. Most entrepreneurs who have built thriving companies settle into a protective and defensive mindset, clinging to core competencies of the past. New inventions bring risk and cost, and they don’t see other companies using them until it is too late. The cost of being late is hard to recover.

    For example, few consumers recognize that Amazon has a subsidiary, Amazon Web Services (AWS), that has invented over 165 computing services for business customers, including new ones every month, that have become crucial to its continued growth.

  5. Insure high-velocity and high-quality decision-making. Bezos categorizes all decisions into two types: 1) Those that are irreversible – requiring deliberation and consultation, and 2) changeable, reversible –best made quickly by high judgment small groups or individuals. Most decisions fall in group two, and Bezos stays out of this loop.
  6. Forever reinforce and espouse your Day-1 culture. Normally, in the beginning most organizations function with speed, nimbleness, and a risk-acceptance mentality. Later, complexity and layers creep in, characterized by slowness, rigidity, and risk aversion. Bezos sees Day-2 thinking as leading to stasis, irrelevance, decline, followed by death.

In my view, Amazon illustrates that the world of business management has evolved, from command and control being dominant, to one designed for speed, agility, and scale in serving customers. Customers are now the drivers of your ability to survive and thrive in business.

People at the top and all levels, like Jeff Bezos, with an understanding and commitment to these values, are the key to success in every company today, more so than any management and delivery system. As an entrepreneur, how well do your values align with these? Your future satisfaction and success likely depends on your answer.

Marty Zwilling

*** First published on Inc.com on 12/12/2019 ***

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Wednesday, December 25, 2019

6 Tips On How To Really Prepare For Your New Venture

new-business-discussionDespite the rush in every academic institution to offer more courses on entrepreneurship, I still haven’t found it to be something you can learn in school. Of course, you can pick up the basic principles this way, but the problem is that the practical rules for success are changing so fast that no academic can keep up. The best thing you can learn in school is how to learn.

The successful entrepreneurs I have met and worked with over the years all seem to share that passion for learning, and they see rapid market change not as a problem, but as an opportunity for them to move ahead of the crowd in changing the world. Making big money is usually the last thing on their mind, and most are happy living on Ramen noodles in a sparse apartment.

From a practical standpoint, there are many ways to learn about business change, and the opportunities that may spring up at any moment. Here are six steps that every aspiring entrepreneur should take full advantage of:

  1. Communicate with peers who have “been there and done that.” The common term for this is networking, but I find that many aspiring entrepreneurs like to do all the talking about their latest new idea and fail to listen. You don’t learn anything while talking. Successful entrepreneurs love to share, but they respond better to pull rather than push.

  1. Research current success stories and role models. The Internet is better than the Library of Congress or any university, since it changes daily to keep up with reality and is interactive. Reserve some time each day for your favorite blogs and influencers, follow up with social networking and expand your personal contacts offline.

  1. Find a business mentor, as well as a friend. A mentor is someone who will tell you what you need to hear, while a friend might tell you what you want to hear. Actually, you need both, and the ability to tell the difference. I find that all entrepreneurs benefit from bouncing their ideas off someone else, and unique perspectives can add real value.

  1. Don’t skip new “learning how to learn opportunities.” These include the classes in school that focus on case studies and team exercises, but extend beyond the academic world to professional and industry seminars. Focus on the opportunities that match your needs for today, since you never know too far ahead what you need to know next.

  1. Volunteer to help organizations related to your interest. There is no better way to broaden your perspective and understand realities than to work in an environment where motivations are positive. You can get real leadership experience and real learning without long-term commitments and financial pressures.

  1. Start your own small business. The cost of entry for an entrepreneur is at an all-time low, with very low incorporation fees in most states, website creation tools for free and the ability to create and offer smartphone apps for a few thousand dollars. Learn from the challenges of a startup with a low-risk idea before you bet it all on the big dream.

I fully recognize that self-initiated learning is not for everyone. If you are one of those people who likes structured classes and counts on spending a couple of week in the classroom every year to catch up, I don’t recommend the entrepreneur and startup lifestyle. Starting a new and innovative business is not a highly structured process, and finding time for structured learning is unlikely.

Finally, it is always helpful to check your motivation to be an entrepreneur. If you see it as the path to easy money or as an escape from an existing job or family pressures, it’s time to recognize that learning doesn’t come easily if your heart isn’t in it.

There is no substitute for doing what you love, and loving what you do. Once you learn to love learning, you too can be a successful entrepreneur.

Marty Zwilling

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Monday, December 23, 2019

7 Ways To Jeopardize Key Startup People Relationships

business-office-contract-agreementRelationships are the key to survival and success for entrepreneurs, and first impressions usually turn into lasting impressions. As an advisor to many early-stage entrepreneurs, I caution them to always be prepared for that chance meeting with a famous investor, a potential partner or an industry guru. It’s not smart to believe that your passion and gift of gab will impress anyone.

Advance homework and preparation is key to every good first impression. With smart people, you can’t bluff your way past tough questions, and talking more and louder about your dreams won’t fill the gap of relevant content. Despite the fact that you can’t predict the circumstances of every first meeting, there are many faux pas that you can avoid, including the following:

  1. Failure to recognize an important person before introduction. Every entrepreneur should build a “cheat sheet” of 10 key individuals they hope to encounter at any given meeting or networking opportunity. The impact of responding first with facial recognition from LinkedIn or Facebook is huge compared to possible alternatives.

  1. Start talking immediately about your project and background. Asking questions and listening will leave a greater first impression more often than talking. Even more impressive are targeted questions that indicate you already have done your homework on their current role, expertise and company affiliations.

  1. Quick to name-drop common friends and business links. A mention or introduction from a shared friend will always give you an advantage. But be cautious about dropping names of people who may not really know you, or whose recollection of you may not be so positive. The investors I know are quick to do some real due diligence.

  1. Ask a thousand questions, with no apparent objective. To make a memorable first impression, you need to make your objective clear in simple and non-emotional terms, before the other party has to ask or guess. Think of it as not wasting the other person’s time, and always positioning the next step, like asking for a meeting or a partnership.

  1. Flaunt how much you know about every subject. It’s important to do your homework and appear knowledgeable on relevant subjects, but a good impression will turn bad if you interrupt every answer with a correction, or can’t stop talking about any given subject. Good initial conversations should never be turned into debates or political platforms.

  1. Easily distracted by a friend or someone more important. We all hate being dumped quickly in a business or personal situation for someone more attractive or important. Smart entrepreneurs learn how to smile and maintain eye contact, make transitions positively and proactively follow-up to solidify their impact, rather than lose it.

  1. Dress to make a statement or stand out in the crowd. Appropriate dress is all in the eye of the beholder, so that should be your criteria. If you are presenting to a group of angel investors, assume business attire or match the norm of members. Washed-out jeans may be your norm at work, but won’t impress most long-time business executives.

With a little forethought and business sense, all these mistakes can be turned into opportunities for you to be remembered. All it takes is the same diligence that every entrepreneur puts into solution development, their business plan and investor presentation. You shouldn’t be surprised to learn that first impressions usually last longer than any documents you prepare.

Psychologists say it only takes three to five seconds for someone to form a lasting first impression. Either consciously or unconsciously, people important to your future will make quick judgments about your professionalism, character and trustworthiness quickly.

Don’t jeopardize the future of your startup, and your chosen lifestyle, by assuming you can wing it. Only preparation will keep you and your image from flying astray.

Marty Zwilling

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Sunday, December 22, 2019

8 Steps To Making Good Decisions In Life And Business

Women_in_Decision-making_Christine_LagardeDespite many years of advising aspiring entrepreneurs and people in business, I continue to be surprised by the number of people who wait for decisions to be made by default, or allow others to make decisions for them. I assure you that this approach is not the road to happiness, and certainly not the route to optimal decisions. Making no decision is rarely the best approach to life.

For example, I know people who would love to have their own business, rather than be tied to another they don’t fully understand or believe in. Yet, starting a business requires much more than a gut feeling of interest or desire. Every successful new business requires focused work – targeting a specific opportunity, sizing the potential and resources required, and defining success.

None of these elements can be completed primarily by gut instinct, no matter what your background, as clearly argued by Gleb Tsipursky in his new book, “Never Go With Your Gut.” He calls himself a disaster avoidance expert, and bases his recommendations on years of working with and studying large companies, as well as small. My own experience supports his key points:

  1. Identify the need for a decision to be made. This point may seem obvious to some, but I find that many people have no trouble suggesting what others should do, but have trouble recognizing the need for a decision in their own life, especially when it’s not an emergency. The result is lost time, and the window of opportunity may have passed.
  1. Gather relevant information from multiple sources. Of course, your experience and gut instinct are relevant, but should never be used alone. These days, everyone has easy access through the Internet to an infinite variety of facts, insights, and analyses, which can be used improve the accuracy and timeliness of any decision. Do some homework.
  1. Decide on your relevant goals driving this decision. Each of us is different, so never let the goals of your friends or family make your decision for you. This world is full of unhappy, and often ineffective, people in the wrong position. Generally, there are three types of goals: based on time, interests, and long-term objectives. Always follow yours.
  1. Develop clear decision criteria to evaluate options. Here is another point where your gut should be only one input. The decision criteria in any setting are those variables or characteristics that are important to you in life. For most people these criteria would include relevant finances, experience, interest, and satisfaction. Minimize compromise.
  1. Generate viable options that can achieve your goals. This is the brainstorming step, so go for ones that solve your underlying challenge, and don’t judge options just yet. In my experience, the optimal choice almost always involves out-of-the-box thinking and innovation. That’s what successful startups are all about. Your gut may not be creative.
  1. Weigh the options and pick the best of the bunch. When weighing options, try to keep your gut feel out of the picture. Minimize the impact of personalities, relationships, and internal politics on the decision. Don’t be afraid to mix and match parts of different options as seems best suited to the situation at hand. It’s time to make a decision.
  1. Move immediately to implement the option you choose. Ensure clear communication around the decision’s enactment, and accept full accountability for implementation. Think about how your decision can go wrong, and move to guard against these failures. Some people seem to be able to make decisions, but never get around to implementation.
  1. Evaluate the implementation process for follow-up. A perfect implementation of a new business, or any new idea, rarely happens the first time, so be prepared for multiple iterations and revisions. Make this a positive learning process, rather than looking at it as a series of failures. Don’t let your gut derail you before successful implementation.

In reality, a first-rate decision making process like this one is a discipline that is teachable and learnable, and it goes far beyond gut instinct. Unfortunately, in my experience as an angel investor and business consultant, I see leaders at all levels of large companies as well as small, who skip some of the critical steps of this model, leading them to slow growth or even bankruptcy.

In my view, any decision is better than none, and a good decision process is critical to making the best decision for you today. Maybe it’s time for you to take control of your life, and learn to make good decisions, rather than trying to live by someone else’s view of your world. Remember, practice make perfect, and skip the shortcuts.

Marty Zwilling

*** First published on Inc.com on 12/06/2019 ***

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Friday, December 20, 2019

10 Positive Signs For Starting Your Own Business Now

startup-nowWith the current strong economy I’m seeing a continued resurgence of entrepreneurial spirit, and more startup activity than ever before. I believe the days of the “job work” mentality are thankfully waning, with more people looking to get satisfaction by making the world a better place, rather than just tolerating brain-numbing work to fund enjoyment elsewhere.

According to current Kauffman Indicators of Entrepreneurship, the share of new entrepreneurs who started businesses to pursue opportunity rather than from necessity now exceeds 86%, more than 12 percentage points higher than ten years ago at the height of the last recession. In addition, young businesses that are still active after one year continues to hover at nearly 80%.

There is additional encouraging news for aspiring entrepreneurs on many fronts, just in case you are thinking about joining the existing ranks:

  1. Valuations of successful startups have hit an all-time high. An unprecedented number of startups, 427 at last count, are now valued above $1 billion, according to CB Insights. Three of these, JUUL Labs, Didi Chuxing, and Toutiao have already passed $50 billion. Thus a record number of entrepreneurs (and team members) are getting rich.
  1. Initial Public Offerings (IPO) are back as an exit strategy. Statistica reports that almost 20 percent more companies went public in 2018 versus 2017. The median deal size is back over $100 million. Investors are showing an increased appetite for new stocks, with a good percentage of deals pricing above the marketed share price range.
  1. Funding for early-stage startups is more available than ever. Last year 300,000+ American angels invested an estimated $25 billion in more than 70,000 startup deals. Crowd funding is setting new records worldwide, with $17 billion from North America alone, and VCs poured another $100 billion more into small growth companies last year.
  1. Cost of entry for a startup is at an all-time low. I can remember when creating a web site for eCommerce could easily require a million dollar investment. Now you can create a web site for almost nothing - and be on your way with your latest invention or personal services. Smartphone apps can be built for less than $10K, so who needs an investor?
  1. Startup incubators and accelerators are popping up everywhere. Business incubators were all the rage before the dot-com bubble (700 for profit, many more non-profit). After the bubble burst and the recession, more than 80% of them disappeared. Now they are back in every community, with the best even waving money at graduates.
  1. The world is a now single market, both homogeneous and heterogeneous. Entrepreneurs now can think globally about the opportunity, from day one but start locally. This approach, popularly known as “glocalization,” means you design and deliver global solutions that have total relevance to every local market you plan to attack.
  1. Social media is a boon for entrepreneurs and startups. With the key social media platforms today, an entrepreneur can tune a product, build a brand, and grow the business with very low cost and a high interactivity never before possible. The elements include communications, mobile platforms, and location-based services.
  1. Large corporations have lost their ability to innovate. Conglomerates, which were the engines of growth and vitality in the twentieth century, have proven themselves unable to innovate, and have a tarnished public image due to financial woes and poor management. Most now routinely buy startups for new technology and new products.
  1. Women are a growing force as entrepreneurs. According to the latest Women’s Entrepreneurship Report, overall female rates have continued to increase and the gender gap has narrowed. Women inherently should have an advantage, since women already control over 70% of household income and $20 trillion of consumer spending.
  1. Baby Boomers are joining the fun in record numbers. The percentage of startups created by entrepreneurs between the ages 55 and 64 continues to grow more than any other age demographic. Driving forces include their need to work and stay energized for the longer life expectancies, as well as the opportunity to give life to long-held dreams.

Looking ahead, Forbes predicts that in 2020 the supply of VC money will still be quite robust—with over $100 billion in investments across more than 10,000 deals. They also suggest that a business valuation discipline has returned to the Valley. The investment thesis has shifted from “growth at all costs” to “growth with fundamentals.”

The image of an entrepreneur is at an all-time high, so why would you continue to work in a job that you hate, or provides no satisfaction? Step into a new entrepreneur era where the definition of “work” is something you love. It’s never too late to start, but don’t forget the fundamentals.

Marty Zwilling

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Friday, December 13, 2019

10 Ways Owners Often Jeopardize Their Business Growth

negative-business-growthWhen you are starting a new business, every resource is precious, including time, funding, and people. Yet we can all look back, after the fact, and realize that we could have been more memorable. Obviously you can’t go back for a do-over, but you can certainly learn from your mistakes as well as all our successes. Most challenges you have are not unique to your business.

In the interests of helping you work smarter and last longer, I would like to offer my top ten list of key resource drains to avoid in early businesses and startups, based on my years of advising entrepreneurs and my own business experience:

  1. Expanding your product line too quickly for scaling. It’s always tempting to think that more product variations will satisfy more customers and lead to new sales. The problem is that more SKUs dramatically increases complexity and cost, when you can least afford it. My advice is to focus and sell more of what you do best, rather than adding new things.

  2. Buy too much inventory too soon to get unit costs down. Inventory is a balancing act, but I see too much inventory much more often than too little. Unit costs are important, but don’t forget about the cash flow hit, extra storage costs, and the probability of obsolete inventory due to necessary updates or pivots. Use multiple small orders at first.

  3. Lack of attention to team and process productivity. Some chaos is normal in every new business, but many wait far too long before they install metrics based on “best practices,” and fail to attack obvious bottlenecks with a vengeance. You may be the main problem, insisting on making every decision, and hiring cheap helpers rather than help.

  4. Poor communication and visibility from the top. As the business operation and the team grows, regular and effective communication from key personnel is critical. New businesses often burn excessive resources working on the wrong things, or doing things the wrong way. Daily updates from the top and documented processes are critical.

  5. People with the wrong tools or no training. As your business starts to scale, you can’t do everything manually anymore. Make sure people have the right tools, and know how to use them, for accounting, inventory tracking, and planning. Too often I see businesses of some size still using spreadsheets for inventory, or post-it notes for problem tracking.

  6. Measuring time worked rather than business results. It’s no secret that some people are more productive than others, due to skills, training, or commitment. We all know team members who work long hours, but are short on measurable output. Be sure to attach employee bonuses and even overtime opportunities to measurable business results.

  7. Ineffective and expensive marketing campaigns. The most cost-effective marketing approaches have changed; from catalogs to web sites, and from television commercials to social media. Yet I still see expense budgets based on traditional channels, with no strict metrics on cost of customer acquisition by channel, or lifetime customer value.

  8. Excessive support and return activities. Support-intensive products and high return rates can sink even the best run business. Support costs and return rates need to be regularly benchmarked against industry norms, and aggressive root cause analysis done to isolate the problem. Excessive resources required in this area are rarely recognized.

  9. Outsourcing services that could be done in-house. There is always a need for highly skilled or capital-intensive services, such as legal and manufacturing, that should be outsourced. But I often see premiums being paid for social media monitoring, standard accounting, and facilities mgmt. Outsourcing is an expensive solution for poor planning.

  10. Inadequate focus on hiring and people development. Where hiring seems to always be associated with a crisis, I rarely see an adequate assessment of candidate skills, culture, and future potential. This results in time and money lost due to high turnover, low productivity, and skill mismatches. Make employee management a proactive process.

In reality, there are an infinite number of ways to jeopardize the future of your business, but these are common ones I see that are often invisible to the business owner or founder. We all know that small businesses mush operate without a cushion, so unrecognized waste can easily lead to death.

In this age of new technology and new learning, you need to constantly be on the lookout for new tools and data to optimize your business. How much time have you spent recently working on the business, rather than in it?

Marty Zwilling

*** First published on Inc.com on 11/26/2019 ***

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Monday, December 9, 2019

5 Factors That Set Your Best Startup Funding Strategy

crowdfundingWith the advent and popularity of crowdfunding platforms, including Kickstarter and IndieGoGo, as a winning alternative for funding your new venture, I find that many aspiring entrepreneurs are confused about the need to ever seek a professional angel investor. I think it’s great to have more options, but I still see each one having a place, so don’t be too quick to limit your alternatives.

To refresh your memory, angel investors are typically high net worth individuals, accredited by the SEC and willing to invest their own money in a high-potential startup for a share of the ownership. See the popular TV show, Shark Tank, for a glamourized version of how they work, and what to expect in negotiation. In the real world, most angels are regular business people like you and me.

Crowdfunding, on the other hand, opens the investment door online to almost anyone who is willing to bet on a new product or service with an investment, typically for a chance to be first in line for the offering, and willing to forgo any equity or management position in the company.

In my role as a small business consultant and mentor to many entrepreneurs, I recommend the following key considerations for the best strategy to pursue for outside funding, if you choose not to fund the business yourself:

  1. Consumer products and trends need market validation. If your new startup is addressing a consumer need, such as a new gadget or food service, then crowdfunding response can give you the ultimate validation of a large-scale market, as well as full funding. Alternatively, with minimal response, you need to rethink your business plan.

    For example, many of you remember the Pebble 'Smartwatch', which raised over $20 million and made crowdfunding real. Yet overall more than two-thirds of crowdfunding campaigns do not meet their monetary goal and have to return anything they do collect.

  2. Business-to-business products need professional investors. If your target customer is a business, rather than a consumer, I recommend you skip crowdfunding as poorly applicable. This is the realm of the angel investor, who wants to own a piece of the new business, and probably knows how to run it and wants a seat on the Board.For B2B startups, every investor expects to see a proven business model, with a working prototype, and preferably a real customer or two. They don’t get excited by early stage research, development, or marketing hype. Crowdfunding is not the best platform here.
  3. Consider the need for multiple rounds of funding. Most startups need more money than they anticipated, to grow and expand their business, after development and rollout. Professional investors understand this need, and are prepared to support it, unless crowd funding was the first round. Investors are very wary of unknown owners and valuation.

    Facebook, for example, may seem like a reasonably simple consumer application. Yet it required fourteen rounds of investment totaling many millions, before it became profitable enough to fund its own growth, and reach a current market valuation of over $500 billion.

  4. Compare the time frames and costs of alternatives. In most cases, a crowdfunding campaign can be rolled out more quickly, and earlier in the development cycle than a campaign to find professional investors. On the other hand, crowdfunding platform fees cost more than finding investors; as much as five to ten percent of the money you need.
  5. Early visibility can be a curse or a blessing. For very competitive environments and disruptive products, you may want to limit your visibility before a high-profile rollout. You can do this by targeting specific investors, with non-disclosure agreements, but crowdfunding will require early and broad public marketing efforts of your timeframe.

    On the other hand, early marketing may increase your brand’s acceptance, and the crowdfunding platform may be the low-cost way to spread the word. If your campaign is funded quickly and generously, this also sends a very positive message to customers.

In reality, the most successful funding decision I still see is called ‘bootstrapping,’ or self-funding. Even today, the majority of successful businesses are bootstrapped or funded in the initial stages by the founders or bank loans rather than outside cash injections. The smart entrepreneurs I see evaluate all the alternatives, and pick the one that makes the most business sense for them.

Marty Zwilling

*** First published on Inc.com on 11/21/2019 ***

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Saturday, December 7, 2019

How Smart Entrepreneurs Don’t Hesitate To Seek Help

business-people-talkingWhile starting a new business always involves tackling many new challenges, I’ve personally found myself reluctant to ask for help. I suspect it’s a function of pride and confidence in my own problem solving abilities, but my hesitation has definitely cost me time and money. Thus, in my consulting with entrepreneurs, I always encourage them to get more comfortable asking for help.

I found some good guidance on this subject in a new book, “The Leader You Want To Be,” by Amy Jen Su, a managing partner in an executive coaching and leadership development firm. She suspects, like me, that no self-respecting entrepreneur wants to seem weak, needy, or incompetent, and none of us like to feel indebted to someone we see as a peer or a competitor.

Of course, there are good ways and bad ways to ask for help. We have all been frustrated by some who are constantly taking and never giving, or people who seem to always ask trivial or generic questions. Here are five concrete tips on doing it right, which I am paraphrasing from the author:

  1. Do your homework first, and ask for help on specifics. Most experienced business people love to help, but they don’t have the time or interest to give you a course on basic business concepts, like the need to be competitive. If possible, you should always couch your questions around a specific case, leading with the options you know or have tried.

    For example, I will admit that my least favorite question from an aspiring entrepreneur is “Where do I start?” I get much more satisfaction, and can provide more realistic help, in steering you through specific pricing, organizational, or competitive challenges you face.

  2. Clearly identify key constraints around your request. In business, we all have to deal with real constraints around every unknown, such as a limited budget, not enough time, and fickle customers. I would like to give you my best answer to your question, without first having to ask you a dozen questions before I even understand the context.

    With my IBM software product background, I could talk at length about competing with other players with big brands, but your problem may be a wealth of small competitors with no brand. I don’t want to waste your time, or mine, solving the wrong problem.

  3. Don’t assume that no one could possibly help you. Believe me, there aren’t many business challenges or problems that haven’t ever been seen before, in some context. You can cause yourself a lot of work and pain if you assume that nobody could possibly have knowledge or insight on this issue, or at least point you in the right direction.

    Sometimes asking peers in a different business can actually improve your chances of getting some real help. Bill Gates, for example, readily admits to asking Warren Buffett for insights, and vice versa, and these two are clearly not in the same business domain.

  4. Start by helping others, and they will return the favor. Not only will this activate the spirit of reciprocity in them, but you will be surprised by how much you learn in the process of helping others. Some of the best business leaders have found that collaboratively working on a problem with your peers yields the best solutions.

    There are several business peer groups, including Entrepreneurs' Organization (EO), with a stated purpose of providing guidance to peers, in a risk-free environment. With a small time investment on your part to help others, you may be the biggest beneficiary.

  5. Practice by asking for help from your own team. Not only does this process yield better results than relying only on your own knowledge, but it makes you more comfortable with asking for outside help. In addition, it creates a culture where asking for help is seen as a strength and encouraged, rather than a weakness to be penalized.

Based on my own experience in business, I’m more and more convinced that asking for help, if done correctly and strategically, is actually a sign of strength, rather than a weakness. In this complex and rapidly changing world, it’s impossible to know everything you need to know, and smart business people build real two-way connections with people who have been there first.

If you make asking for help a learning experience, rather than a search for excuses or a perceived weakness, you will find that the best feeling of comfort is less stress and more success in your business and your life.

Marty Zwilling

*** First published on Inc.com on 11/19/2019 ***

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Friday, November 29, 2019

6 Hard Questions That Every Entrepreneur Must Answer

Hard-entrepreneur-questionsAs a mentor to many aspiring entrepreneurs, I challenge them to think beyond what I call linear extensions to a current trend, such as another “easier-to-use” app for smartphones, a new dating site for pets, or another niche social network. In my experience, these startups usually find the field crowded with competitors, making it hard to get any attention, and most drift into obscurity.

On the other end of the spectrum are ideas that truly represent a disruptive technology, or could lead to real social or environmental change. Examples I have seen include atomic battery technology, or how marine algae could help feed the world. Unfortunately, all of these may be fraught with high technical risks and political change required, which also often leads to failure.

Obviously, where you need to be is somewhere in the middle, and certain that you are the right person with the right resources to win. I encourage every entrepreneur or new business owner to ask themselves a set of hard questions to validate their idea and fit, before they put their heart, much hard work, and money on the line. These questions should always include the following:

  1. How realistic is your business opportunity today? Your idea may indeed be a worthy cause, like feeding the hungry, but hungry people rarely have any money, and third-world governments are not a viable market. On the other hand, if you can find ten or more similar existing competitors, your chances of being found by even a large market is small.

  2. Why doesn’t this product or service already exist? The right answer to this question is that you bring some new intellectual property to the table – like a patent or other secret sauce. After years of working with smart entrepreneurs, I’m convinced that most good ideas have already been tried, and you need to focus on your unique execution potential.

  3. Do you have the resources to build a business? Building a product, as well as a business, takes money and people. Do you have the skills and interests to overcome problems, lead people, and find partners and funding? Most businesses require a team of people with diverse skills, all with a success mindset and commitment to common goals.

    In the real world, evidence indicate the vast majority of new ventures are self-funded, or bootstrapped. Attracting external investors takes much time and effort, and forces you to pay home to their interests. In all cases, people management and leadership are key.

  4. Should this be a non-profit or for-profit business? The difference relates to how you expect to get funding. Traditional investors are not interested in non-profits, no matter how good the cause, since there will be no financial return on their investment. Non-profits rely on philanthropists and donors. Also evaluate the values of desired customers.

    In my experience, non-profits are also harder to run and grow, since money is always short, internal salaries and skills may be low, and the customer set is often driven by emotional decisions rather than financial value. Great social entrepreneurs are rare.

  5. What will you do if you get no traction on this idea? Smart entrepreneurs think proactively about a “Plan B” or obvious pivot before a crisis and they are out of money. This will incent earlier thinking outside the box, and help you get metrics in place to track progress, or lack of it, along the way. Keep alternative business models on the table.

    For example, if you have a new calendar-scheduling app, it would be tempting to target consumers as your primary market, because there are so many of them, compared to businesses. Yet business have real budgets and a clear need, so may be easier to sell.

  6. Why are you the right person to do this now? No matter how great the potential, if you are starting a business for the wrong reason, failure is likely. The right reason would be to bring value to customers, with a strong conviction that you are uniquely qualified to make it happen. Think twice if you are trying to escape a problem, get rich, or satisfy others.

Of course, there are no magic formulas for entrepreneurial success, since every new business inherently has many unknowns. My goal is to give you a way to bound these risks, and perhaps be better prepared with some alternatives. More success is better for all of us – business owners, investors, and certainly customers.

Marty Zwilling

*** First published on Inc.com on 11/15/2019 ***

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Friday, November 22, 2019

8 Techniques For Shining A Light On Your Blind Spots

burmese-elephant-blind-menMost of us have blind spots in our ability to build a business, due to lack of experience, too much ego, over-confidence, or unjustified faith in a subordinate. Only a few of the entrepreneurs I have worked with in a decade of consulting are smart and humble enough to recognize that they don’t know what they don’t know, and have an effective process for shining a light on their blind spots.

For instance, I find that tech entrepreneurs are often so blinded by their shiny new technology that they fail to anticipate the infrastructure and political changes which gate the business. Auto engines that burn hydrogen are a great technology, and would appear to be a great business, but getting service stations around the world and new safety legislation has already taken decades.

Every successful leader has to learn how to act with a visible confidence and faith in their own abilities, and that of their team, while remaining aware of their own biases and blind spots. They need to actively avoid the hazards that come with overconfidence and excessive optimism. The best leaders accomplish this by asking good questions and really listening to the feedback:

  1. Don’t preface your questions with your own assumptions. I find that team members are often reluctant to challenge their leaders, and will tend to concur or just keep any counter-views to themselves, thus avoiding conflict that could impact their career. Never state your position first, when asking for input from others before a hard decision.

  2. Always use directed questions and insist on direct answers. Smart leaders are quick to cut off attempts to redirect the discussion, or evade the question, to cover a lack of knowledge or feign support. The best strategy is to narrow the question until you get a specific response or a clear indication that they have no relevant input.

  3. Insist on facts and specifics to support all opinions. Be sure to separate speculation from facts, and act only on facts. It’s fair to start with what people think they know, as long as you use that to zero in on corroborating evidence and real examples. Blind spots are easily covered by opinions and speculation, but real facts are hard to counter.

  4. Restate what you are hearing for confirmation. To confirm understanding, and push people to provide more information, it pays to paraphrase back from a different perspective their conclusions and recommendations. This often leads to follow-on questions that expose the real blind spot that either of you may be unaware.

  5. Push alternative views limits, to check for side effects. If I suggest your technology needs validation in the market before scaling, it’s fair to ask how long and how expensive that test could be. That’s really a form of risk management, as well as a learning opportunity. Risk management in the face of unknowns is the primary job of a leader.

  6. Expand every dialog by asking open-ended questions. Yes-or-no questions may appear to be more efficient, but usually these don’t surface the new information that may help a leader to realize what he doesn’t see or understand. Strong leaders actively seek out people who have opposing views, with the intent to overcome their own biases.

  7. Look honestly at your track record on similar issues. If this issue reminds you of your previous failures, it may indicate one of your blind spots. If these cases, I recommend some extra due diligence and soul searching, to make sure you are not about to go down the same road again. Smart leaders learn from their mistakes, and don’t repeat them.

  8. Regularly question and listen to a trusted advisor. Even industry titans like Bill Gates and Warren Buffett have mentors and advisors, and they use them often to search for blind spots in their own thinking. Often an outside perspective, especially if rooted in a different industry, will give you the insight you need to make a smart leadership decision.

Today’s business world is more complex than ever, and the international elements make it all the more challenging. I always recommend that you lead with your strengths, and recognize that we all have blind spots. Surround yourself with people who have strong complementary skills, rather than less experienced people who will tell you what they think you want to hear.

The result will be fewer blind alleys, fewer required pivots, and a clearer view of your business potential and legacy. In business, it’s always less painful to get it right the first time, than to be in crisis and reactive mode most of the time.

Marty Zwilling

*** First published on Inc.com on 11/11/2019 ***

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Monday, November 18, 2019

5 Ways To Increase Your Agility In The Face Of Change

As a business and entrepreneur advisor, I have no trouble getting owners and managers to agree that change is happening faster and faster in the consumer and technology world, requiring them to keep their business more agile, just to keep up. The challenge is that too many are confused on what that means for them, and what it takes to make their business competitively agile.

I just finished a new book, Agility: How to Navigate the Unknown and Seize Opportunity in a World of Disruption, by Leo Tilman and Charles Jacoby, which has helped me net out the key principles for businesses to become more agile. These authors, and I agree, define agility in business as the ability to detect and assess changes in the competitive world in real time, and then take decisive and effective action.

We also agree that agility enables a business to stay healthy and outmaneuver competitors by seizing new opportunities earlier, better defending against threats, and acting as a well-orchestrated and empowered whole on innovative initiatives.

The book brings a wealth of examples to the picture, based on author strategy consulting with major companies, governments, and the military. In their experience and mine, the essence of business agility is embodied in the following five principles:

  1. Early detection of change and the need for change. This may seem obvious, but most small business leaders are so busy with current issues, and running the business today, that they spend very little time or resources looking for customer culture changes, analyzing new technologies, or political and economic realities that will impact them.

    Crisis-driven agility is not enough today. You need time and resources looking ahead for change. Perhaps failure to look ahead was not the primary reason for the demise of Blockbuster and Kodak, but I see it happening to smaller businesses every day.

  2. Effective assessment of change drivers and alternatives. It starts with everyone being encouraged to look for the surprising or unexpected, and not being penalized for bringing bad news. Sometimes you need to use outside consultants and listen to your advisors, before the crisis, to overcome cognitive biases and evaluate response options.

    Often the answer may be a quiet change in marketing strategy, or adding a new demographic, but real change may require a bigger response. Apple, as an example, has made agility and new markets their brand image, as well as their source of growth.

  3. Timely response with smart risk-taking and innovation. Cohesion and team unity are integral to timely agility, expedited by a willingness to take and share risks. These imply a special brand of people leadership and a culture of trust throughout the business. Often I find that small businesses slow down as they grow, and become more risk-averse.

    Jeff Bezos and Amazon are an example of continuous growth, where you can see how far and fast constant change, innovation, and risk taking can take your business. They started with a focus on books, but expanded online access to cover almost everything.

  4. Culture of purposefulness and decisiveness. Every business needs a strategic purpose, vision, and values that are regularly updated, visualized, and clearly communicated by senior leaders to everyone in the organization. True agility also requires a willingness and ability to make decisions and execute in stride, at all levels.

    Examples of business today who have focused on a higher purpose and values includes Whole Foods and Patagonia, where evidence indicates that their average return, brand image, and growth are much greater than other companies in their space.

  5. Sustaining a will to win, with a bias toward the offense. Agility requires a mindset and culture grounded in the competitive will to win that encompasses what is called a bias toward offense rather than defense. It’s the only way to avoid losing. Team members look up and down the command chain for role models and positive direction in this regard.

    If you think of successful entrepreneurs, including Elon Musk and Richard Branson, you will find them primarily in offense mode. Both are capable defenders, but spend most of their efforts pushing new limits in aerospace, advanced technologies, and new markets.

In summary, both the authors and I see agility as the overarching quality which encompasses many important other more specialized business traits, including adaptability, resilience, flexibility, and dynamism. If you intend for your business to survive and thrive in today’s world of rapid change and global competition, it’s time to start now making agility your leadership strength.

Marty Zwilling

*** First published on Inc.com on 11/04/2019 ***

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Monday, November 4, 2019

6 Steps To Move From Inspiration To Business Reality

new-business-ideasAs a new business advisor and occasional investor, I get approached regularly by people who have a dream or a new business idea, and are looking for support and money to make it a reality. They are usually short on specifics required for execution, so I have to tell them that the idea is the easy part – and the real challenge is execution, even if someone gives you the money.

Based on my experience and data from the field, over seventy-five percent of new startups fail, even with venture backing. The number is much higher for those who choose to go it alone, without help. I say this not to discourage you from acting on your idea, but to encourage you to anticipate the work required to get you from inspiration to a sustainable and satisfying business.

Thus, I’m more impressed with entrepreneurs who ask me to review their implementation plan, rather than listen again to their idea. There are lots of resources available for the challenge of that activity, including the Internet and mentors like me. In my experience, the key steps I look for always include the following:

  1. Testing the idea against customers who have money to spend. Just because you think it’s a great idea doesn’t mean there is a business opportunity. I suggest you use social media, blogging, crowdfunding, or documented research to quantify a real demand from people who can afford it, and don’t have a better alternative already out there.

    I love good causes and social entrepreneurs, but a recent pitch to me about eliminating world hunger with a new product (harvesting algae at low cost) seemed to forget that really hungry people don’t have any money. Even a non-profit needs income to operate.

  2. Build a credible business implementation plan to quantify costs. Some dreams sound great, but may not yet be viable or proven with today’s technology. Others may be so exciting that you will find multiple competitors fighting for the same space. Writing down key parameters will force you solidify the specifics, and mentally commit to them.

    I recommend a ten-slide pitch to start, reviewed by friends and advisors, to be expanded to a ten-to-twenty-page business plan with opportunity sizing, cost and price details, competitors, marketing and sales strategy, financial projections, and resources required.

  3. Make sure your solution is defensible and unique. Unfortunately, I see good startups fail simply because they don’t have the resources or intellectual property to stay ahead of copycats or big players who see the potential as soon as you step into the marketplace. Any startup with no patents, trade secrets, or other secret sauce is very high risk today.

    Even a provisional patent will hold your position for a year, can be done by your team at low cost, and will at least incent big competitors to buy your idea rather than just steal it. Most investors will not even look at you until you have a defensible solution to offer.

  4. Prepare your marketing story for customers and investors. I haven’t seen a new idea yet that was so intuitively obvious that it would sell itself. Start by developing an “elevator pitch,” that you can deliver in thirty seconds to hook a potential customer or investor. Present at trade shows and network with your ten-slide pitch to build your following.

    For inspiration, I recommend you watch a few episodes of the Shark Tank TV series, where entrepreneurs pitch their wares, looking for an investment and national visibility for their product or service. Reach out with creative videos to influencers in your domain.

  5. Make the product or service come alive. Well before launch, as well as after, all the preparations have to be in place to deliver and support your solution. This means staffing and delivering the business legally as an LLC or corporation, completing a website and business licensing, and arranging for manufacturing, distribution, and support.

  6. Implement a strategy for growth and improvement. For a business to be sustainable in this era of rapid change, you need a strategy and plan for continuous innovation, new products, and expanding your customer base. This is the point where you must manage to metrics, work on the culture of the organization, and look for partner-based growth.

Now you can see why you, as well as advisors and investors, should never judge business potential by the idea alone. In fact, the common element in all these steps is “you.” As a result, smart investors will tell you they invest in the jockey, not the horse (people, not ideas). A great vision and dreaming about a great idea, without implementation, won’t make a business.

I believe totally in the old adage that a successful business is really one percent inspiration, followed by ninety-nine percent perspiration. How much execution perspiration are you prepared to expend along the steps outlined above to make your dream come true?

Marty Zwilling

*** First published on Inc.com on 10/21/2019 ***

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Wednesday, October 30, 2019

7 Secrets to Leading Others and Enjoying Your Legacy

Steve_Jobs_leader1By default, every one of you who owns a business or manages a team has the title of leader, but in my consulting experience, I find that just having the title doesn’t make most of us a leader. I also find that leaders are made, not born, meaning that we all can grow into leadership, if we learn from experience. I find also that if you fail as a leader, your team will likely fail with you.

Of course, everyone thinks they know what it takes to make a great leader, and many books have been written about the subject. Yet I haven’t found many that offer practical recommendations and examples. In this context, I was impressed with the new book, “The Intelligent Leader,” by John Mattone, widely regarded as the world’s number one executive coach and authority.

John distills the work he’s done with thousands of clients over the years into what it takes to lead, empower, and inspire others. I like his seven actionable principles of leadership for the rest of us, that we can use to evolve ourselves as business leaders as well as owners, including the following:

  1. Consistently strive to think different and think big. Most of the people on your team have to worry about the current crisis, and getting their job done today. A leader has to keep the big picture in mind, and keep people focused on the long-term vision and mission. Hone in on alternative ideas that are actionable, no matter how revolutionary.

    Steve Jobs had many faults, but he was perhaps best known for his marketing slogan “Think Different” and his commitment to a vision of new and better products, inspiring consumers to demand products and services they never even knew they needed.

  2. Create a culture of vulnerability, and be the role model. Allowing yourself to be vulnerable and transparent to others makes it possible for them to trust you. Without vulnerability and humility, real change and growth isn’t possible. You need to be willing to open yourself up to others’ feedback, and acknowledge flaws in order to correct them.

    Jack Welch, one of the most successful executives in American history, set up a “reverse mentoring” process by pairing younger, more internet-adept employees with he and older members of senior management so that the former could teach the latter about new technology. This made his leadership team stronger, and built huge bonds with his team.

  3. Replace a mindset of entitlement with a mindset of duty. The duty mindset is a perspective in which you see yourself as a key cog in a much larger wheel. Having this bigger picture empowers you to better identify the areas where you need improvement, and set yourself on the right course to positively impact those around you.

  4. Prioritize leveraging your gifts over closing your gaps. First, don’t hesitate to solicit input to get the most accurate possible picture of yourself. Then don’t take your strengths for granted, or overreact to gaps. Develop an action plan to lead from your strengths, and seek outside support or complementary partners to shore up leadership weaknesses.

    In the early days of Microsoft, Bill Gates recognized his technical leadership skills, but relied on partner Steve Ballmer, trained at Procter & Gamble, to lead the marketing and business development efforts. Both learned from the other, and became even stronger.

  5. Cultivate the courage to execute with passion and precision. Some never make the shift from perspective to action, even if it takes you outside your comfort zone. Only then can you identify the opportunities for change, and make the mistakes leading to growth and learning. Fearlessly executing with pride and passion inspires others to follow you.

  6. Take the time to stay present, listen, and be vigilant. Leaders often make the mistake of thinking that their time is more valuable than anyone else’s, but this breeds resentment and takes you out of touch with reality. In this age of distraction, you need to slow down and absorb each situation, decision, or moment, to provide the most effective leadership.

  7. Make course correction both a mindset and an action. As an action, course change leadership is what you do in the moment, when you need to pivot. As a mindset, it’s a way of life. You need to be aware that the world around you is in a state of constant evolution, and your leadership must stay balanced in the face of inevitable change.

Ironically, despite all these positive action items, intelligent leadership in business isn’t really even about you – it’s about the culture and the teams that you create, who really are the leadership interface that your customers see and depend on. Your challenge is to be the steward and model for the leadership that inspires the success and legacy that we all want for our business.

Marty Zwilling

*** First published on Inc.com on 10/16/2019 ***

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Monday, October 28, 2019

How Starting A Business Fits Into Every Career Today

start-business-career1With the cost of starting an online business today at an all-time low, I can’t imagine why everyone doesn’t have a web site and an LLC to mitigate liability and minimize taxes. You need to have these as backup, in case the gig economy catches up to you, or you need a side hustle for extra income, or being in control of your dream role as an entrepreneur finally becomes a passion.

I also suggested this a while back to my neighbor who was between jobs, through no fault of his own, and frustrated by the slow pace of the job search, and wondering what else he could do to improve his position. First of all, you should never wait for a crisis to prepare for the future, but even initiating a startup for consulting in your favorite role is good for the following reasons:

  1. Companies prefer candidates with no gaps in their resume. Having your own online business going eliminates that embarrassing period where it appears you have been idle and desperately seeking work. Instead, having your own business going shows initiative, leadership, wider experience, and makes you more competitive for any role available.

  2. A single job is not adequate for today’s lifestyle. To keep ahead of the game, the smartest people I know always have several things going concurrently – and more in the queue. With the rapid pace of change in the world, everyone should be working on multiple projects, including a conventional paying job as well as an entrepreneurial one.

  3. Learn more about business by doing versus studying. Of course, you can always take more business classes at school, or on the side, but that’s not as cost and time effective these days as doing it, with a little help from the internet and a friendly advisor like me. Make it a fun experience by making something you love be more than a hobby.

  4. Give yourself a lifestyle choice – employee or owner. Too many people I know would love to change careers over time, but don’t really have any experience or confidence with alternatives. Now is the time, with minimal risk and cost, to give yourself some insights on what you like, what you know best, and how to leave a legacy you can be proud of.

  5. Keep up with modern business tools and online processes. You will be a better employee, or a better owner, if you know how to use social media tools for business, how to go online for web hosting, a domain name, a company name, and incorporating a business. New tools make it easy create your own web site, and manage accounting.

  6. Start networking for potential partners or people who can help. Whether your future is a career or a startup, you need business relationships. Smart people find that business is no place for a loner, and we all need someone to test our ideas, hone business skills, and focus on complementary activities. Seek out relevant business groups and events.

  7. Find maximum meaning and purpose, as well as money. Every study shows that happiness does not scale up with income. Doubling your income in a job might increase happiness by ten percent. Doing good, like helping society and planet sustainability, is a key to maximizing satisfaction, as well as profit. Start a business while you still can.

  8. Challenge yourself to find out what you are capable of. Don’t let me mislead you. Starting a business is still hard, even though the cost of entry is low. The challenge will make you grow as a person, and can give you the confidence to succeed in whatever you decide to do. You will find that startup efforts help you in every future role you tackle.

In these days of the gig economy, world-wide outsourcing, and working remotely, you need to think of yourself as a business, even if you haven’t created one formally. The days of long-term employment and employer loyalty are gone, so quantifying your value, and marketing yourself are key skills in any environment.

Take advantage of internet, free tools, and peers out there today to get ahead of the curve. You won’t regret it when seeking future career opportunities.

Marty Zwilling

*** First published on Inc.com on 10/14/2019 ***

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Friday, October 25, 2019

5 Strategies To Thrive In Customer-Driven Disruption

Amazon_Prime_Air1In my experience as a business consultant, I find than most people still believe that technology drives business disruption. I’m more convinced that technology merely enables disruption, and changing customer interests and needs really causes it. Many companies try to recover with more advertising and rebranding, and discover that these strategies don’t work well in today’s market.

Other companies keep the focus on their customers, and seem to thrive on disruption, much less survive. They make it their top business priority to understand, anticipate, and gratify customers’ needs. I first saw this approach outlined well in the new book, “Customer-Driven Disruption,” by Suman Sarkar, former A.T. Kearney consultant and now leader of his own consulting practice.

As disruption examples, the rise of ride sharing, e-commerce, and social media were clearly driven by changing customer trends, more than technology. Even smartphones, though based in technology, are more of a customer phenomena than a technology play. I like the five strategies that this author recommends for capitalizing on future rapidly emerging customer needs:

  1. Win with current customers before chasing new ones. New customers are more expensive to acquire, and typically produce less revenue than would current, satisfied customers. Yet, when faced with declining revenues, most companies focus on finding new customers. I recommend creating new services and products for existing customers.

    When Amazon wanted to increase its revenue, it identified existing best customers and offered a new membership service – Prime “free” shipping. Shipping costs increased, but membership fees from 100 million new Prime members more than made up for it.

  2. Offer affordable personalization without a premium. Mass-produced products aren’t on anyone’s wish list anymore. Today, customers want personalized products and services at reasonable prices. To make personalization affordable, leaders must use available technologies but not market them, create flexible operations, and reduce waste.

    Memorable personalization doesn’t always have to include fancy technology or high cost. In many cases, a thoughtful gesture is more than enough. Nordstrom “remembers” the sizes of customers, and Chanel follows up sales with handwritten notes from associates.

  3. Speed up both the new design and the supply chain. Customers don’t wait today. Most companies take too long designing new products and services. By the time the product launches, more nimble competitors have captured the market, or customer needs have changed again. Often that means finding new channels or a better supply chain.

    Zara, a fast fashion company, gets new catwalk trends to stores more quickly by a faster supply chain. They keep their manufacturing facilities close to the market instead of locating them in distant Asian countries, so new designs reach stores within a week.

  4. Develop higher quality than just good enough. Now that consumers judge products based on reviews and peer recommendations, rather than advertising, quality if more critical than ever before. It’s time for designing and thinking outside the box, to offer a level of quality and performance customers can’t resist and the competition can’t beat.

    Chick-fil-A changed their quality focus to the kind of quality that today’s customers care about. Their birds are raised in barns, not cages, on U.S. farms. They avoid fillers, added hormones, and steroids. Revenue per location now averages double that of McDonalds.

  5. Continuously revisit and evolve, or re-invent yourself. In today’s fast changing customer environment, what works today may be “old news” tomorrow. Smart companies make and measure change as part of their normal strategy process, rather than only focusing on it when a crisis occurs. Use autonomous teams, rather than functional silos.

    Disney, for example, has managed to maintain its broad entertainment appeal by evolving from Mickey Mouse cartoons, to Old Yeller type movies, Pixar animation movies, to Star Wars and Indiana Jones. Theme parks and attractions are revised regularly.

Disruption wrought by customer change can be a death sentence to a business, and technology alone is not the solution, or cause. Every business should start capitalizing today on the strategies outlined here to retool their products, services, culture, incentives, and operations to thrive on disruption, rather than fight and fear it, in the days ahead. There is no going back.

Marty Zwilling

*** First published on Inc.com on 10/10/2019 ***

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