5 Ways Emotional Decisions Can Endanger Your Startup

I’m sure we have all seen entrepreneurs with high levels of passion and confidence touting an idea that seems to make very little sense to us. Of course, we never see ourselves in this mode, yet we need to recognize that all humans see reality differently through a built-in set of “cognitive biases,” based on their own unique background of experiences, training, and mental state.

These biases are good, in that they allow us to quickly filter and make decisions in the constant barrage of information we face each day, but bad because they often lead to errors in reasoning and emotional choices. The worst case is called the “passion trap,” where a pattern of beliefs, choices, and behaviors feels good and becomes self-reinforcing, but leads to disaster.

John Bradberry, in his classic book “6 Secrets to Startup Success,” identifies five key biases that sabotage many passionate entrepreneurs in their startup decision making. I challenge any entrepreneur to honestly tell me they have never fallen victim to any of these in making startup decisions:

1. Confirmation bias. This refers to the human tendency to select and interpret available information in a way that confirms pre-existing hopes and beliefs. The antidote is to look for dissenting views that seem to form a pattern of concern. Then what you perceive as isolated exceptions, might indeed appear as a clear majority.

2. Representativeness (belief in the law of small numbers). Many entrepreneurs tend to settle on conclusions they like, based on only a small number of observations or a few pieces of data. The new founder who hears positive reviews from three out of four friends may assume that 75 percent of the general population will react similarly.

3. Overconfidence or illusion of control. Overconfidence leads founders to treat their assumptions as facts and see less uncertainty and risk than actually exists. The illusion of control causes startup founders to overrate their abilities and skills in controlling future events and outcomes. Both result is “rose-colored” plans, rather than realistic ones.

4. Anchoring. This refers to our mind’s tendency to give excessive weight to the first information we receive about a topic or the first idea we think of. It encourages founders to cling to an original idea or, if pressed, to consider only slight deviations from the idea instead of more radical alternatives. The ability to pivot sharply and timely is at risk here.

5. Escalation of commitment (“sunk cost” fallacy). Startup founders often refuse to abandon a losing strategy in an attempt to preserve whatever value has been created up to that point. They feel that they have put so much money, time, and energy into an idea or plan, that it must be the idea. Investing more into a bad idea doesn’t make it good.

Optimism, for example, is a typical entrepreneurial trait that improves performance, but only up to a point. In fact, according to a recent article, too much optimism (optimism bias) is responsible for many failures in business. There are a number of similar entrepreneurial characteristics that are recognized as good, but can be amplified to unhealthy levels, resulting in passion traps, or so-called “Icarus qualities.”

Every entrepreneur needs to be on the lookout for early warning signs of biases and passion traps that signal that you are in danger of undercutting your odds of startup success. Obvious ones are founders who are thinking or saying, “This is a sure thing,” or executives losing patience with advisors who point out risks or shortcomings in your plan.

In my experience, a great startup is more about great execution, rather than a great idea. It’s about converting your passion into economic value. To counter-balance the biases in your passion, the best approach is to look beyond your own mind and actively listen to your customers, your advisors and your team. When was the last time you really listened?

Marty Zwilling

Factual Data On Popular New Venture Success Timelines

Every startup founder knows implicitly that startup success is a long hard road. Yet we always dream that we are the exception to the rule. So once in a while it’s good to look at some facts to temper our imagination.

I was reading an old article written by marketing guru Seth Godin a while back where he mentions that “it takes about six years of hard work to become an overnight success”. Based on a small sample of household names from Bill Gates to Mark Zuckerberg, he is an optimist. Here is some data from Wikipedia:

• Microsoft – Bill Gates founded Microsoft in 1975, to develop and sell BASIC interpreters for the Altair 8800. Six years later, he managed to land a contract with IBM to provide their IBM PC base operating system. Even still, it was another five years before Microsoft went public in 1986, making him an overnight success worth $350 million.

• Apple - It took Steve Jobs two decades to become an overnight dot-com billionaire. Established in Cupertino, California in 1976, Apple really didn’t get on the map until the advent of the Macintosh in 1984, eight years later. Even then, it struggled through the 80’s and 90’s, until the advent of the iMac and consumer products.

• Yahoo! - This company was founded by Jerry Yang and David Filo in January 1994. In April, 1996, Yahoo! had its initial public offering, raising $33.8 million, by selling 2.6 million shares at $13 each. Amazon.com and Yahoo! are the benchmarks in the industry for overnight success, but still required two to three years to really get going.

• Google - Larry Page and Sergey Brin started working on Google in 1996 – but three years later in 1999, few people had even heard of it yet. But add another five years, and Google had made it, going public in 2004 with a market capitalization of $23B.

• Facebook - Mark Zuckerberg, while attending Harvard as a sophomore, concocted “Facemash” in 2003 to get a lost girlfriend off his mind. He later changed the name to Facebook. In 2005, Facebook still showed a yearly net loss of $3.63 million. But within five years it became an overnight success, and now has nearly 3 billion users worldwide.

• Amazon.com - Jeff Bezos founded Amazon.com in 1994 and took it public three years later, making him a multibillionaire. Amazon's initial business plan was unusual: the company did not expect a profit for four to five years; the strategy was actually more effective than his business plan predicted. Very rare case.

Take heed. These examples are generally recognized as the fastest growing companies in recent times, so your odds of matching their speed are not good. Investors will always look askance these days at a business plan which projects Amazon.com results.

With most businesses you rarely hear about the months and years of hard work behind the scenes. You rarely hear about the major catastrophes followed by major miracles that brought the businesses back from the brink. You rarely hear about the owners who took out second mortgages to make payroll or to hire a salesperson.

If you don’t have realistic expectations, you can quickly get into the wrong state of mind. You’ll be thinking that to be a success your business has to make you a billionaire in three years. Then you’ll give up way too soon.

This notion of overnight success is an urban legend, and very misleading. If you're starting something new, expect a long and challenging journey. But that's no excuse to move slowly. Many entrepreneurs think they are running, but find themselves falling farther and farther behind a rapidly moving target. Time passes quickly in this mode.

Marty Zwilling

7 Workplace Culture Dynamics That You Need to Support

Even before the recent pandemic, when more people began working remotely, I noticed the dynamics changing in many workplaces, both between employee interaction with peers, and interactions with customers. People on both sides seem to have a shorter attention span, appear less tolerant, and less interested in building personal relationships related to business.

In my role as a business advisor, my challenge is to understand the reasons for these culture changes, and to offer guidance on what you can do to keep your team engaged and positive. Studies have shown that work productivity is related to a happier work culture, and customer satisfaction and loyalty are also dependent on the culture. Here are the key elements I see:

1. Make your company culture virtual. Building and maintaining a winning work culture is no longer just a function of the office. You must regularly host online meetings, as well as external networking and team-building exercises. Don’t wait for word-of-mouth to spread your culture. Use marketing, blogging, and industry conferences to get the message out.

   For example, CEO Mathilde Collin of Front has implemented 25 ways her company has translated their strong in-person culture to the new remote reality. These include a weekly “Ask Me Anything” call with her team, virtual game night, and birthday shout-outs for all.

2. Balance remote work and contract assignments. The trend toward more remote work, flexible work hours, and outsourcing can eliminate productive work relationships and communication between functions. Customers will be impacted and less likely to have a memorable experience. Your challenge is to enable communication between all teams.

   Some business leaders don’t realize that managing remote work and outsourcing always increases their communication and project management workload, rather than reducing it. Thus, the move to remote workers can actually increase costs and risks, unless anticipated and balanced. Don’t eliminate the home-office team too quickly as you learn.

3. Facilitate work on favorite personal devices. The advent of powerful new devices, including laptops, smart phones, and tablets, affords everyone with alternatives that are more productive and satisfying for them, without sacrificing productivity. The stigma of a clunky desktop today can easily lower worker engagement and satisfaction.

   This trend to BYOD (Bring Your Own Device) is catching on rapidly across many offices. Of course, you may have to set boundaries and take extra steps to protect your data, their personal data, and IT infrastructure from devices no longer entirely in your control.

4. Give extra credit for smarter work versus more work. Make sure your team members get rewarded for changes and new tools for improving overall productivity, not just personal hours worked. This requires that everyone understand the total process, your business goals, and that you enable collaboration rather than isolation of functions.

5. Move to modern platforms for more collaboration. Customers and peer groups, including freelancers, are already using popular social media platforms, including Facebook and Twitter, so make them a part of your team culture. Newer collaboration platforms, such as Zoom and the Cloud, are a step up from your legacy internal platform.

6. Measure results in terms of customer satisfaction. It’s easy for technology to count number of products sold, or service requests completed, so these can become your focus, rather than number of customer advocates, or repeat customers. The result can be employees who don’t see the value in positive relationships and collaboration with peers.

7. Don’t overlook the interests and benefits of Boomers. As your customer population ages, they will relate more to your mature workers, and both will be more satisfied. Studies have found that these are often more productive, and more conductive to positive relationships and the collaboration that builds the workplace culture you need to survive.

As a business leader, it should be apparent to you that the things are changing in the workplace environment, just as fast as the market and technology are changing for your business. It’s an opportunity for you to win over competitors, and expand your market, maybe more important to long-term survival and success than product innovation. Make it part of your strategic plan today.

Marty Zwilling

*** First published on Inc.com on 10/13/2021 ***

8 Strides For Balanced Business Thinking And Delivery

Based on my own experience in business, the best results come from a balance of vision and creativity, combined with a clear focus on logical problem solving and results. This balance is rare and often called “whole-brain” thinking, versus the traditional right-brain or left-brain orientation. Recent studies indicate that less than ten percent of business leaders show this balance today.

Most of the entrepreneurs I meet as an investor and advisor have no shortage of right-brain thinking, showing vision and creativity, but often don’t realize that their potential is being limited by a balancing focus on results, metrics, and customer specifics. Here is my list of key principles for creating and capitalizing on a balanced focus as a business professional or an entrepreneur:

1. Start by marketing your vision and purpose. Too many entrepreneurs I know start by highlighting their new technology, and assume that it will sell itself. Unfortunately, technology doesn’t create a vision, and usually frightens customers away, unless they understand the vision and value first. Every balanced leader does marketing early.

2. Break your creativity into specific deliverables. Most people need manageable product, time, and price specifics related to them, to appreciate the value of the big picture that you paint. Don’t expect investors and customers to follow you, based primarily on the strength of just your passion, and your long-term strategy.

3. Show results with a minimal viable product (MVP). Trim your vision into a simple and focused quick solution that illustrates your potential, but doesn’t have to wait too long or cost too much to be appreciated. If you try to strike out in too many directions all at once, you will confuse customers, and likely not do anything well, due to limited resources.

4. Listen to customer feedback and tune your vision. Even your best vision of the future is likely not perfect, and stubbornly following it in the face of pivot recommendations is a recipe for failure. Learn to take action quickly on feedback, diligently solve problems, and build momentum toward your objective. This is where a balanced thinking focus is critical.

5. Build trusted relationships and listen to advisors. Peer relationships and good advisor relationships are key to any balanced leadership, especially for right-brained people. Even Steve Jobs, who relished his visionary thinking, later learned to listen to his advisors and his Board, after loosing his leadership role in the early days of Apple.

6. Keep up with the curve, but don’t get too far ahead. Some very creative leaders try to move too fast, in their passion to get the ultimate impact. They overwhelm and lose their followers, and they tend to run out of money. This is where metrics and real data must be used to guide your business, complementing your own vision and intuition for the pace.

7. Celebrate every progress step along the way. Visionaries and their followers tend to burn out, never noticing progress toward that final dream. Your job is to break the big objective into small steps, and celebrate every success. This will keep you and your team energized, learning from each step, and willing to do the work for the final success.

8. Balance your business with your personal life. Personal growth and satisfaction is rarely all about business. Whether you are right-brained or left-brained, you need to find time for your family, external entertainment, and your health. Business leadership and success requires whole-brained satisfaction with you and the whole environment.

If you find it impossible to think adequately right-brained and left-brained at the same time, then I recommend that find a partner you can trust to complement your strengths and interests. Certainly you need to keep this in mind as you select key team members as well. Don’t fall for the delusion of “yes” people, or feel successful when everyone on the team thinks like you do.

Real business success from the right balance of interests, skills, critical thinking, as well as execution. Don’t let your dream idea and business slip away due to a lack of focus on results, and don’t let your technology invention fail to start by never communicating the context. With the right thinking, your potential these days is huge.

Marty Zwilling

*** First published on Inc.com on 10/12/2021 ***

The Demographics Of New Venture Founders Are Changing

Contrary to what you might guess, the highest rate of small business and entrepreneurial growth over the last few years is not Gen-Y upstarts, but Boomers over the age of 50, now called encore entrepreneurs. In fact, according to the latest trend data and press reports, these Baby Boomers have grown yearly to 41 percent of small business owners, second only to Gen-X, at 44 percent..

Some people are calling business ownership the ‘new mid-life crisis’ for the 72 million-strong demographic once thought to be over the hill. Partially due to the pandemic, but also due to longer, healthier lives and changes in job tenure, Boomers are now expected to stay in the labor force longer, and according to projections, could actually dominate the labor market by 2024.

Here are some indicative business ownership facts from recent trend data and other projections. These could convince you that the correct icon for an entrepreneur may now have gray hair, rather than the warm glow of youth:

• The percent of entrepreneurs who are Baby Boomer starting a business in the last few years has grown by 18 percent year-over-year, with more than half (51 percent) now making up the aspiring small business owner pool.

• In every one of the last 15 years, Boomers between the ages of 55 and 64 have had a higher rate of entrepreneurial growth than Gen-Y, aged 20–34.

• Additionally, research has revealed that the average age of the founders of technology companies in the United States is a surprisingly high 39 - with twice as many over age 50 as under age 25.

• While people under 30 have historically jumped from job to job, another striking development has been a deep drop in the incidence of ‘lifetime’ jobs among men over age 50.

• With longer life expectancies and greater health in later life, older generations are moving to start new firms -- and mentor young entrepreneurs. One new incentive is the falling transaction costs and barriers to entry for entrepreneurs of every age.

• 83 percent of online users aged 50-64 use social media now, and the growth rate continues to increase. Social networking penetration by Boomers is now catching up with the other age groups, reaching nearly 90 percent across the board.

• In the U.S., immigrants are almost twice as likely to become entrepreneurs as native-born U.S. citizens. Immigrants represent 27.5 percent of the countries' entrepreneurs but only around 13 percent of the population.

In addition, the Boomer demographic is also creating a slew of new market opportunities, including improved healthcare facilities, construction of senior-friendly facilities, and technical support for seniors, by seniors. What all of this means is that Boomers will have more impact and power in the marketplace for a lot longer than most people expected.

Since new businesses are a key driver of economic growth, this should bode well for America, and for world economic growth as well. In terms of job creation, innovation, and productivity, entrepreneurs drive growth. Many Boomers have the purchasing power and become enthusiastic early adopters who help lead the way. They are becoming the new early adopters.

Of course no one has any idea what the next big thing will be, but more often than not innovation comes from entrepreneurs. If you are one of the Baby Boomers who wants to redefine retirement, now is your chance for real impact. Find an opportunity you understand, follow your passion, and join the entrepreneurial majority.

Marty Zwilling

8 Portfolio Assets Are Key To Your Startup Valuation

A large portion of your competitive advantage and your potential value to investors is the size of your intellectual property portfolio. When someone says Intellectual Property (IP), most entrepreneurs think only of patents. In reality, patents are only one of at least eight items that should be in your IP portfolio. You need all these before you start looking for funding.

Some of the other items may cost a lot less, and may be worth far more in the long run. Here are the key elements:

1. Company name. The company name becomes your intellectual property at the moment you incorporate your startup as an LLC or a Corporation. Sole proprietorships need to trademark the name to protect it. Select it well – marketers will tell you that you will be selling your name, more than your products. Actual incorporation fees in many states are below $100, if you do it yourself. Don’t pick a company name until you are certain that you can get the comparable domain name, so Internet brokers won’t hold you hostage.

2. Internet domain name. This name (www.domainname.com) is just as critical as the company name, and the two should match as nearly as possible. Significant differences will confuse your customers, and open the door to imitators and scam artists. Internet domain names can be acquired from most hosting providers or Network Solutions, for as little as $10/year each.

3. Social media accounts. Immediately go to relevant social media sites and grab the same name, even if you never plan to use the accounts. Many companies like Sears, Coca-Cola, and Twitter have already been hurt by people using company names they don’t own on social sites. These days, every business needs a blog, so sign up your domain names accounts on TypePad, Wordpress, and Blogger, or all of the above, before someone starts blogging in your name.

4. Patents. Remember that ideas cannot be patented, only novel implementations. But the application or provisional application has to be registered before you disclose the details to investors or consumers, or the implementation will be deemed un-patentable. Attorney fees start at around $5K, but provisional patents can be filed yourself for about $300.

5. Trademarks. A trademark is a name, phrase or logo that tells the consumer the origin of the goods and distinguishes your goods from those of your competitor. Trademarks require a federal trademark registration from the United States Patent and Trademark Office. The cost for a single trademark is less than $300.

6. Copyrights. No registration and no cost is required to secure a copyright on written, audio, or video material that you create to be attributed to your company. Still, it is recommended that you add the familiar ©Copyright 2021 symbol at the beginning or end of each media and document segment.

7. Trade secrets with employment agreement. Companies often use non-patentable but important trade secrets to run their business. These trade secrets need to be documented and coupled with an employment agreement, to keep them from migrating to your competitors when employees move on.

8. Business Plan. Your business plan holds the keys to your kingdom, so you don’t want it in the hands of competitors. If you need early reviews or assistance by people you don’t know well, get them to sign a Non-Disclosure Agreement first. A sample agreement is available for free download from my website.

In cost, all of these elements of intellectual property may be acquired for a few hundred dollars (or a few thousand with an attorney), if you act early and quickly. Later, good intellectual property can be worth millions when your company valuation is set for investment purposes, or when the company is acquired or sold. In between, you need it to survive.

Marty Zwilling

5 Rules Of Relevancy That Set Your New Venture Apart

Some investors seem to focus wholly on the strengths of the management team, or a sustainable competitive advantage, and in reality these are the core attributes for every funding equation. While these may be necessary for funding, they may not be sufficient to make your startup the great success embodied in your vision.

In the last few years, perhaps in reaction to the business integrity issues leading to the recession way back in 2008, I am seeing a renewed focus on other less tangible attributes which can set your startup apart. Examples include the Conscious Capitalism® movement, founded by John Mackey of Whole Foods, the B Team, founded by serial entrepreneur Sir Richard Branson, and the Benefit Corporation (B Corp) form of business now available in 35 states.

I have always struggled to communicate the multiple other relevant priorities, and the other intangibles required for a great execution. I found many of these in the classic book “Great From The Start: How Conscious Corporations Attract Success ,” by John B. Montgomery, which does a great job of laying out specifics.

It also starts with a good summary of the intangibles, summarized as the five rules of relevancy, by Mark Zawacki:

1. A startup needs to be relevant and stay relevant. Relevancy for an early-stage company is the discovery and understanding of the real addressable market for a product or service. This is not the total opportunity out there, and not the total target market, but the subset of customers who have and will spend the money you need to cure their pain.

2. A startup needs to find a voice relevant to its ecosystem. These days, you have to foster a community of support for your business. That means educating targeted supporters is key, even before you start to sell. Selling too early triggers customer defenses and drives them away. Everyone hates being sold to; we all prefer to buy.

3. A startup must gain balanced traction. This is not just sales traction, but a proper balance between resources, product, and customers. It means building a viable and desirable product before selling, assembling the right team with funding, and recruiting and educating enthusiastic customers who will be your best advocates.

4. A startup must form partnerships and alliances within its ecosystem. Today’s ultracompetitive global environment demands that you make alliances early. Startups often pay lip service to strategic partnerships, but they schedule these efforts far down the road. The right partnership strategy can make a company relevant.

5. A startup must maintain a relevant laser focus. Too many early-stage companies are so desperate for customers that they operate in a frantic and random sales mode. They sell into multiple verticals, or pursue multiple revenue streams, such that they can’t develop a repeatable, scalable sales process, and don’t do anything well.

Of course, relevancy doesn’t work if you don’t have a winning business model. In the traditional business environment, this means the priority is an adequate return for your stakeholders, but today it also means your company should provide a material positive impact on society and the environment.

Great companies recognize that there are now multiple interdependent stakeholders, including customers, business partners, and social groups, who need to be part of your equation since they can drive or limit your success, in addition to management and stockholders.

In other words, your startup needs to be a “conscious” entity, constantly aware of the complex eco-system around it, and the factors driving change and evolution. This requires conscious leaders who are passionately committed to personal and professional growth, as well as the greater good of society. These leaders then cultivate the consciousness of their team members.

In reality, your people are the consciousness and relevance of your startup, and your customers judge your startup as they would judge a person. No relevant company can afford to focus on short-term wins over the long-term effects of its behavior on other stakeholders. How much time and how many measures has your startup applied regularly to the relevance issues above?

Marty Zwilling

7 Keys To Making Many Millions In A Business You Love

Many aspiring entrepreneurs are looking to the Internet as an opportunity to get rich quick, instead of a place where you can start a business you love, for very little capital and minimal technical expertise. The reality is that if you build a business you love, you may in fact make big money, but if you start a business to get rich, you will probably fail.

In my experience, there are good reasons for starting a business, and good ways to go about it in the new online world, but even entrepreneurs with good intentions often don’t have a clue on key principles to follow for this rapidly changing platform.

The best place to learn is by scouting around the Internet today. See what other people are offering, and think about a niche where you could be unique, and have some fun at the same time. There are also many other good sources of guidance, including the classic book “Click Millionaires” by Scott Fox.

He addresses the dream of many to be a dot.com billionaire, but emphasizes the need to start with an assessment of your own goals and interests. Starting an Internet business is a new lifestyle, so you need to understand the implications. On the business side, I am adapting here his seven success principles, too often overlooked by people who leap before they look:

1. Find a niche to help real people. Look for real problems to solve, like losing weight, staying healthy, or gaps in a popular product line. “Nice to have” sites like Facebook and Twitter look attractive, but they are much higher risk, and a thousand fail for every one that succeeds.

2. Position yourself as an expert. People tend to buy from people they perceive as “experts.” Expert status is no longer a formal degree or certification. Today it more often means a “trusted friend” who seems real, visible, and doesn’t “push” products. Don’t hide behind a website with no address, picture, or direct contact information.

3. Automate to the max. Take advantage of software tools to automate routine business functions, like taking and delivering orders. Provide website forums to help customers solve their own problems. Use free e-commerce software and services like PayPal before building an expensive customized solution. Generate revenue around the clock.

4. Use the Internet to outsource staff. Hiring virtual assistants for each specific project can be a lot more efficient and cheaper than hiring and managing employees. Start with sites like Elance.com and Guru.com for specialized tasks you can’t do yourself. Pay others to handle small stuff, and keep your time available for bigger priorities.

5. Let your audience help with content creation. Audience contributions, like product reviews, discussion board conversations, and comments on your blog are invaluable because they create more credible content and attract more money from advertisers. Even more valuable are success case studies and testimonials.

6. Define a business that is scalable. First, pick an opportunity that has a worldwide appeal, like eco-friendly products. Then implement automation on production and tracking so you don’t need hours of manual work on each order. Finally, use customer feedback or promotions to attract more and more customers with less and less effort.

7. Focus on recurring revenues. A great way to make more money more easily online is to replace one-time sales with automatically renewing subscriptions. With a stable base of subscribers, this can mean a continuing revenue stream from newsletters, support, or advice on demand.

Even with all this, don’t expect it to be easy. Unreasonable expectations lead to frustration and giving up too soon. Remember, being an entrepreneur is a lifestyle, one that requires constant learning and problem solving, and that’s half the fun. The other half is doing what you love to do, and possibly even making lots of money.

There are more and more Internet billionaires out there every day. Most are not as visible and well-known as Mark Cuban, but their money spends the same way. Can you be the next one?

Marty Zwilling

8 Keys To Innovation And Responding To Market Change

As I “grew up” in business in big companies, including IBM, I always wondered why the real innovations seemed to come from startups, while we had more resources and more experience. Later, in my second career as an entrepreneur with startups, I realized that limited resources and fresh insights actually created the mindset that relied on market change and innovation to survive.

For example, IBM was the industry leader in mainframe computers for business, and we knew thousands of ways they could be linearly enhanced for business applications. Yet we never even dreamed of a new potential for personal use of computers, until startups like Apple and Microsoft stepped into the fray. We didn’t notice as technology advances had opened a whole new market.

Now, as a business advisor to large companies, as well as small ones, my objective is to foster those activities and ways of thinking that broaden the potential for high creativity and recognizing new market opportunities, before resource constraints are applied. If you see yourself or your company ignoring any of these, now is the time to take action:

1. Invest in a new market, as well as new features. I find that non-startups spend most of their resources linearly enhancing existing products, rather than monitoring change in the marketplace and catching the next wave. Employee and customer input are good for fixing bugs, but not good leading indicators. Look outside for future trends and potential.

2. Use brainstorming for more creative solutions. Effective brainstorming is all about defining and executing a process for creative ideas to create a big impact. Most mature companies have unfortunately replaced it long ago with product management groups to fix problems. You can make it work right with short, open-ended sessions, and a leader.

3. Don’t wait for innovation ideas from top management. Front-line people who deal directly with the market are much more likely to see needed changes, and they need to be rewarded for speaking up, rather than penalized for being the messenger. Of course, you have to propose solutions, request funding, and marshal peer support for credibility.

4. Balance the focus on productivity versus creativity. Every business needs a focus on productivity as it scales, but an exclusive focus on faster and cheaper processes minimizes the search for really new opportunities, and long-term growth. In addition, team member engagement and loyalty depend largely on the satisfaction of creativity.

5. Foster a work culture of fun, creativity, and new ideas. People see a work culture of solving problems and repeating fixed processes as just work and drudgery. You will actually get more productivity, as well as innovative new opportunities, from your team by making the work fun through rewarding creativity, and giving them time to think ahead.

6. Don’t make innovation a function of the business plan. Business plans should be outlines of your strategy, milestones, and finances, but not the required source for change timelines and innovation steps. The need for market and technology changes is unpredictable in any timeframe today. Make your innovations frequent and dynamic.

7. Celebrate change failures as learning opportunities. If people fear that failed innovations will bring blame and retribution, they quickly learn to wait for edicts from above before getting creative. Promoting new changes as experiments reduces the stigma of failure, since everyone understands that experiments have a high failure rate.

8. Create and nurture a team dedicated to change. Critical production organizations don’t have the time, mindset, or skills to focus on change, or look far ahead. Build a small dedicated team, sometimes called strategic planning, or change incubator. Choose team members who have been there, or think like entrepreneurs, and reward them on results.

In your business, if you don’t proactively take overt actions like these to foster creativity and innovation, both will likely be lost trying to satisfy existing customers, and trying to keep up with the daily operational challenges that we all have to deal with. Don’t count on your competitors and startups to wait for you to respond. Your ability to survive and thrive in the long-term depend on it.

Marty Zwilling

*** First published on Inc.com on 10/06/2021 ***

How To Incent Your Team To Find More Innovative Ideas

Most entrepreneurs I know are individually very innovative, but a successful startup can’t be a one-man show (for long). That means they need to build an innovative team, which is not a skill that most people are born with. In fact, some very innovative individuals, known as ‘idea people’ or inventors, often end up creating the most dysfunctional teams.

A typical approach to dealing with team dysfunction or no innovation process is to work around it, which normally leads to startup failure. The only way to build productive, collaborative, innovative, and cohesive teams is by resolving core dysfunction issues and implementing a structured process for innovation.

There are many resources out there to help you address team dysfunction, but very few provide much insight on a process for maximizing startup team innovation once you have the motivated people. Chris Grivas and Gerard Puccio published a classic book, “The Innovative Team,” which seems to hit the issue directly, with stories to illustrate key points.

They outline a simple process or framework for fostering team innovation, called FourSight, which is composed of four steps, capitalizing on the leader’s and other team member’s strengths and interests, that is consistent with my own experience in big companies as well as small:

1. Clarify the situation. Innovation is not all about coming up with new ideas. It really is first figuring out which challenges are the most important. Clarifying means sorting out the real problem from the symptoms or distractions, and focusing all team energies there to change things for the better.

2. Generate ideas. This requires divergent thinking, with the strengths of every team member, to generate as many ideas as possible. Then it requires convergent thinking when there are enough ideas to choose from. Look for that sparkling new idea or “eureka” moment to develop into a workable solution.

3. Develop the best solution. No idea is born perfect. Here the goal is to transform a novel idea into one that can be implemented successfully, with tinkering, adjusting, and polishing. True creativity brings novelty and usefulness together. This step includes verification will the solution will actually work, and the improvement can be measured.

4. Implement plans. This is the stage where project plans are created and implemented. Now it’s all about action, and in many ways, about managing change. People who prefer this stage of the process tend to be drivers, known for making quick decisions and getting results. It always helps to temper their preference with patience and sensitivity to others.

In business today, it takes a team to get work done, whether we are talking about a startup or a large conglomerate. The potential of any team is defined by its members, not just individually, but collectively. Then the right process is required for innovative thinking that is greater than the sum of their individual talents and skills.

Although most startups say they want to create a culture of innovation, they should realize that there are implications. Leaders have to focus on open and honest communication to maintain trust. Founders have to be willing and able to reject ideas that won’t work, in a way that still encourages more creativity.

Entrepreneurs have to remain open to creativity and change, despite high-pressured investors driving more toward “making it through the day” and “timeline deliverables” than producing well-developed and novel products, improvements, or new directions.

By becoming more consciously and deliberately creative, entrepreneurs can enjoy their lifestyle with more satisfaction, enabling their team to do the same, and together produce results that no one has yet dreamed of. Are you building a team yet which fits this mold?

Marty Zwilling

11 Keys To Being The Best In Your Chosen Profession

At some point in their life, hopefully everyone strives to be the best in their chosen profession. Most people think that being the best requires more intelligence, more training, and more experience. In reality, in business or even in sports, the evidence is conclusive that it is as much about how you think, as what you do.

I saw this illustrated a while back in the classic sports book, “Training Camp: What the Best Do Better Than Everyone Else”, by Jon Gordon. His evidence and real life stories conclude that top performers in all professions have the same key traits listed below. I agree they certainly apply to the great entrepreneurs I have known. You need to think about how they apply to you.

1. The best know what they truly want. At some point in their lives, the best have a "Eureka!" moment when their vision becomes clear. Suddenly they realize what they really, truly want to achieve. They find their passion. When that happens they are ready to strive for greatness. They are ready to pay the price.

2. The best want it more. We all want to be great. The best don't just think about their desire for greatness; they act on it. They have a high capacity for work. They do the things that others won't do, and they spend more time doing it. When everyone else is sleeping, the best are practicing and thinking and improving.

3. The best are always striving to get better. They are always looking for ways to learn, apply, improve, and grow. They stay humble and hungry. They are lifelong learners. They never think they have "arrived"—because they know that once they think that, they'll start sliding back to the place from which they came.

4. The best do ordinary things better than everyone else. For all their greatness, the best aren't that much better than the others. They are simply a little better at a lot of things. Everyone thinks that success is complicated, but it's really simple. In fact, the best don't do anything different. They just do the ordinary things better.

5. The best zoom focus. Success is all about the fundamentals, and the fundamentals are little and ordinary and often boring. It's not just about practice, but focused practice. It's not just about taking action, but taking zoom-focused action. It's about practicing and perfecting the fundamentals.

6. The best are mentally stronger. Today's world is no longer a sprint or a marathon. You're not just running; you are getting hit along the way. The best are able to respond to and overcome all of this with mental and emotional toughness. They are able to tune out the distractions and stay calm, focused, and energized when it counts.

7. The best overcome their fear. Everyone has fears. The best of the best all have fear, but they overcome it. To beat your enemy, you must know your enemy. Average people shy away from their fears. They either ignore them or hide from them. However, the best seek them out and face them with the intent of conquering them.

8. The best seize the moment. When the best are in the middle of their performance, they are not thinking "What if I win?" or "What if I lose?" They are not interested in what the moment produces but are concerned only with what they produce in the moment. As a result, the best define the moment rather than letting the moment define them.

9. The best tap into a power greater than themselves. The best are conductors, not resistors. They don't generate their own power, but act as conduits for the greatest power source in the world. You can't talk about greatness without talking about a higher force. It would be like talking about breathing without mentioning the importance of air.

10. The best leave a legacy. The best live and work with a bigger purpose. They leave a legacy by making their lives about more than them. This larger purpose is what inspires them to be the best and strive for greatness over the long term. It helps them move from success to significance.

11. The best make everyone around them better. They do this through their own pursuit of excellence and in the excellence they inspire in others. One person in pursuit of excellence raises the standards of everyone around them. It's in the striving where you find greatness, not in the outcome.

Jon is convinced that people are not born with these traits, they must be learned by everyone. He talks about staying mentally strong, and maintaining a big-picture vision while taking focused action. So if you aspire to be the next Elon Musk or Steve Jobs, focus on your attitude as much as your business plan.

Marty Zwilling

*** Ukrainian translation provided by Anna Matesh ***

7 Ways For Do-It-Yourself Entrepreneurs To Get Ahead

In the last few years, I’ve heard more and more about a new type of small business, called a “micro-business” (or micro-enterprise). These are usually characterized as owner-operated, with five employees or less, and less than $250,000 in sales. With the low cost of e-commence entry, and powerful Internet technologies, they require minimal capital to start, perhaps as little as $500.

I see the potential for these to become big business in this entrepreneurial economy. According to the Voice of Microenterprise (AEO) website, if one in three micro-enterprises in the United States hired an additional employee, the US would soon be at full employment. These businesses are usually run out of the home, and cover the gamut from consulting services to e-commerce.

Dal LaMagna, in his humorous classic “Raising Eyebrows: A Failed Entrepreneur Finally Gets It Right,” leads with the foundational principle of micro-businesses, which is to start small. This allowed him to learn enough from all his early mistakes to hit it big ($10 million revenue) with a global beauty tools company called Tweezerman. He and I offer seven key additional practices to reduce the risk:

1. Tailor the business to you. Do you love antiquing? Fishing? Cars? Cooking? Now, think about what pursuing this passion might mean for your lifestyle. Think how you want to spend your day; where you want to live; whether you want to work with people or alone; in the morning or at night, and so on. Eliminate any aspect of your business that doesn't create your preferred lifestyle -- and will work against you.

2. Be frugal. Don't spend money you don't have. Don't invest in anything you don't need. If this means baking cupcakes in the local church basement and delivering your signature pas Ttries by bicycle to local stores -- two dozen at a time -- do it. Take the money you make and put it right back into the business.

3. Record every expense. From the dollar you gave to the homeless guy on the way to meet a prospective client, to the new tie you bought to look professional, write down every single penny. The key to launching a micro-business is to keep expenses under control and fully accounted for.

4. Keep a monthly profit-loss. For the first two years of your business, complete a monthly profit-loss statement. This helps you stay on top of where your business is going, where it could do better, and why it fluctuates.

5. Find free stuff. Many items needed to start and run your small business are available for free or next to nothing. Be creative. Use freecycle.com; ask friends if they have an old computer or printer; or visit a thrift shop for office furniture or office supplies.

6. Write down agreements. With a very small business, your clients sometimes make the assumption that they don't have to sign an agreement. Wrong. Get in the habit of thinking like a company founder and get promises in writing. And while you're at it, keep your side of agreements.

7. Keep it simple. When Dal first started Tweezerman, he did nothing but focus on tweezers and selling them to cosmetic counters, one store at a time, which he did very well. If you can do one thing well, don't dilute your efforts until you have been turning a large profit over a consistent stretch of time.

My net recommendation is that if you consider yourself a do-it-yourself entrepreneur, preferring to do things yourself rather than forking over money to consultants, then definitely the micro-business approach is for you. The down side is that your business will probably grow slowly and more organically.

If you prefer to rely on others for most things, or want to get there fast, the investor approach may be the best answer, but the price is higher in time, dollars, and control. It’s your choice, but remember that the wrong choice probably won’t get you there at all.

Marty Zwilling

8 Keys To The Winning Mix Of Full-Time and Gig Talent

With the pace of change ever escalating, entrepreneurs today can’t afford to acquire talent through traditional hiring alone, and need to revise the perception that “talent” is only full-time office employees. In addition, more people in the workforce don’t want to be resident employees. More than 40% of U.S. workers now say they would start looking for another job if they aren’t offered remote options.

The answer to both is a new fast and flexible talent strategy based on freelancers, consultants, experts, and specialists, who are part of the new “1099 economy” including Baby Boomers and Millennials. For the full picture, see the classic book, “Navigating the Talent Shift,” with convincing arguments by Lisa Hufford, Founder of Simplicity Consulting talent solutions.

The author outlines eight necessary steps for every business and entrepreneur to capitalize on this movement to on-demand project teams, versus permanent hires. These steps are the new keys to driving business innovation, controlling costs, staying nimble, and getting better results:

1. Build teams to meet goals rather than organization charts. Too many entrepreneurs, as they grow their business, are focused on hiring to fill a traditional organization chart, rather than acquiring skills and talents to meet their current goals and needs. They use generic job descriptions and plan for long-term business stability, which rarely happens.

2. Focus on deliverables and skills required right now. Conventional hiring strategies usually follow a vanilla approach to talent acquisition. It’s a numbers game of filling positions, without clarity on the expertise needed to deliver now. With contract players, you assume a project duration, with easy transition to new players for the next campaign.

3. Prioritize objectives and seek expert talent to match. For example, if your first scaling effort is a global one, you should be prioritizing “global launch experience.” The notion of holding out for the “expert in all domains” wastes too much time, effort, and money. In fact, you will never predict required pivots, and generalists rarely outperform specialists.

4. Build an on-demand team of strategic do-ers. The most effective people to execute strategic initiatives are likely ones who have recently led similar activities in multiple related environments, not ones who have been grown and trained inside. This team of specialist consultants is then easily tuned as your strategy evolves based on the market.

5. Think in terms of projects to keep up with an evolving strategy. Each strategic priority should be managed as a project. Some projects are big and long-term, while others are small and more tactical. Projects need not be constrained by organizational boundaries, long-term budgeting, or conventional staffing and training practices.

6. Stay nimble by quickly filling gaps in the existing team. When you identify a skills gap or feel you need additional expertise or insight, signing up on-demand help is the only timely solution. Assigning an existing team member who isn’t qualified, or is already overloaded, will likely delay both projects, and kill existing team member motivation.

7. Leverage the broadest possible network. The on-demand specialized talent pool already includes nearly 100 million people not interested in being full-time employees. By leveraging this broader network, you will improve your probabilities of finding the right skills and experience for your current project, and bring fresh ideas and solutions into your team.

8. Maintain budget flexibility as the business changes. By leveraging on-demand experts, you pay only for the vital work you need immediately, not the overhead and ongoing costs (development, training, severance, benefits) that go along with hiring full-time employees. It’s the best way to handle budgetary restrictions and cuts.

This on-demand talent model, dubbed SPEED by the author (Success, Plan, Execute, Evaluate, Decide), is good for the company, and good for all specialized, dedicated, and high performing people in the workforce today. Your company gets the flexibility to adapt quickly to the needs of a rapidly changing marketplace, and workers get to broaden their experience in the work they love.

We are living in an on-demand world and an on-demand economy, ranging from the movies we watch, to manufacturing and delivery, to the computer resources we need. Welcome now to the on-demand workplace. It’s here to stay.

Marty Zwilling

7 Short-Term Business Mistakes Can Limit Your Impact

As a long-time business consultant and investor, especially to entrepreneurs, I recognize your sparkle of vision, to build the ultimate world-changing product. Every one of you sees yourself as the next Elon Musk, Jeff Bezos, or maybe even Steve Jobs. Yet most of us succumb after a time to the short-term pressures of growing a business, and the long-term vision gets pushed aside.

Of course, it takes both short and long-term focus to survive, but I see too many businesses fall into some common product maladies, which ultimately keep them from becoming a unicorn, or achieving the level of disruptive change they initially envisioned. I found these maladies summarized well in a new book, “Radical Product Thinking,” by entrepreneur Radhika Dutt.

Radhika teaches entrepreneurship and innovation, and advises organizations around the world on how to build radical products that create a fundamental change instead of optimizing the status quo. I agree with her seven “product diseases,” where the business execution challenges steal the focus away from that grand vision and holy grail that you all started out pursuing:

1. Hero syndrome – focusing on scale versus impact. Everyone, especially your investors, wants high-growth, higher-return decisions, to make them a hero sooner. The trouble is that disruptive change usually takes more time, and scales slower than most people expect. Thus you are driven to short-term growth fixes versus radical change.

   For example, a few years ago, the company Beepi had a vision to build a new market for buying and selling used cars, but became overly focused on fundraising to grow fast, and ignored many customer complaints. While the idea was great, they failed on execution.

2. Strategic swelling – more features than any other. It’s easy to say “yes” to one more feature request after another, until the potential for real impact gets diluted. You spread yourself so thin across many areas, and don’t achieve any one goal at a breakthrough level. The solution is never to forget that initial clear purpose that translates into priorities.

   Yahoo has been an example of a company which expanded in all directions through 53 acquisitions, to the point where most customers were confused, and it was overtaken by Google as your main search engine. Make sure your vision is clear and communicated.

3. Obsessive sales – must meet revenue goals. As your startup starts to generate returns, you will recognize the pressure of quarterly revenue goals, with qualified big customer prospects needing just one more small change to close. It suddenly and consistently seems reasonable to trade off long-term goals for survival in the short term.

4. Hypermetricemia – metrics for everything. This malady is focusing on “measurable” outcomes to determine success, rather than your goal of long-term change. To know what to measure, you need to remember what you’re actually trying to achieve. Don’t be over-reliant on measuring everything, and forget the breakthrough vision and strategy.

   My advice is to focus on a handful of high-level metrics that matter, and are simple and relevant to organizational objectives. Tune out the stuff that could be impactful but isn't actionable, as well as the stuff that's actionable but not related to your impact and vision.

5. Locked-in syndrome – do what worked in the past. Don’t commit to a technique, technology, or approach just because you have related expertise or because it has worked in the past. Always explore alternative solutions that might work better to achieve the impact you are hoping for. Focus on the real problem, rather than a favorite solution.

6. Pivotitis – keep pivoting till we get it right. Directional changes in the face of a problem often result in wild swings in product offerings and customer segments, causing confused, demoralized, and exhausted teams. Sometimes the right solution is to push through problems, or at least first redefining your vision, strategy, and action plan.

7. Narcissus complex – look inward to see what helps. Don’t lose focus on the customer, or open opportunities for competitors to pass you by with your own disruptive change. When you look first inward, you tend to measure yourself by internal benefits instead of the impact on the world. You may win the near-term battle but lose the war.

These business maladies can all be cured by starting with a clear vision of where you are going, and translating it to drive your everyday activities, rather than letting business issues drive your vision. Otherwise, your most innovative and disruptive product thinking will be diluted and lost, killing your dream of a better world. Now is the time to develop a new mindset and stick to it.

Marty Zwilling

*** First published on Inc.com on 09/28/2021 ***

7 Keys To Transforming A Dream Into Business Reality

Successful entrepreneurs are usually hard-driving, and highly focused on some specific goals, like being the dominant player in a given domain, or the low-priced provider of their product. Yet other entrepreneurs will talk for hours about all their ideas, and how they intend to change the world, but I don’t hear any specific goals or milestones.

Many people are very hesitant to set specific goals, due to lack of self-confidence or whatever. The result is that they don’t ever get anywhere, because they never really knew where they wanted to go. If you find yourself in this category, try the following simple steps highlighted by Brian Tracy in his classic book “No Excuses: The Power of Self-Discipline”:

1. Decide exactly what you want. If you want to increase your income, decide on a specific amount of money, rather than just “make more money.” Without precise goals, you can’t measure progress, and you miss the real satisfaction of knowing when to declare success.

2. Write it down. A goal that is not written down is like cigarette smoke; it drifts away and disappears. It is vague and insubstantial. It has no force, effect, or power. It’s too easy to forget or push aside when outside forces arise that you hadn’t anticipated – and they will. On the other hand, most people don’t hesitate to write down excuses.

3. Set a deadline with specific milestones. Pick a reasonable time period and write down the date when you want to achieve it. If it is a big enough goal, set intermediate milestones for measurement reference points. The rule is “There are no unrealistic goals; there are only unrealistic deadlines.” Don’t be afraid to change the deadline – for cause.

4. Make a list of things you need to do to achieve your goal. The biggest goal can be accomplished if you break it down into enough small steps. Make a list of obstacles and difficulties, knowledge and skills required, necessary people, and everything you will have to do to meet the goal. Add to these lists as you learn more.

5. Organize your list by both sequence and priority. A list organized by sequence requires that you decide what you need to do in what order. A list organized by priority enables you to determine what is more important. Then develop a business plan which embodies all of the above.

6. Take action on your plan immediately. Don’t delay. Move quickly. Procrastination is the thief of time, and it shortens your life. Winners in life take the first step now. They are willing to overcome their normal fear of failure and disappointment, and take a small step, and then other one, until they reach the goal.

7. Do something every day that moves you in the direction of your major goal. This is the key step that will guarantee your success. Do something every day that moves you at least one step closer to the goal. In this fashion, you develop momentum, which further motivates, inspires, and energizes you. Soon it becomes automatic and easier.

You can’t control the future, and that’s not the purpose of goal setting. It’s also a recipe for failure to assume that the path to your goal will require suffering and sacrifice. In fact, the whole objective of all steps above is to allow you to avoid stress and suffering, and be more fully motivated by your progress.

As you adopt a goal-setting mindset, you will find yourself setting different kinds of goals. These are lifetime goals, not just a collection of near-term objectives. It’s these really big objectives, that seem unachievable even to you right now, that will inspire you the most, and motivate you to real success and happiness.

Marty Zwilling

6 Keys To Aiming Your Product To Mainstream Customers

Every technical entrepreneur is an early adopter of technology, so naturally they build things with people like themselves in mind. Unfortunately, for most solution markets, early adopters represent only 10 to 15 percent of the total opportunity, so it’s easy to get mislead on the real requirements of mainstream customers. Psychologists call this the confirmation bias. I call it failing by early adopters.

The good news is that early adopters are never reluctant to sign up as beta customers and will provide you early feedback on product quality. The bad news is that they are not a good test of basic usability and ease of operation, which are always a key to the much larger market of regular customers. Consider the long market acceptance struggle of digital wallets and home automation.

Listening too much to early adopters often leads to an expensive death spiral, since these users will request more and more features, more precise control of the technology, and more interoperability, all of which increase the complexity of the product, and decrease the usability for the average customer. The result is a bigger and bigger chasm to cross to your real market.

Many in the business world has heard of or read the old bestseller by Geoffrey A. Moore, “Crossing the Chasm,” but most entrepreneurs don’t realize how much it relates to them. In fact, it’s all about understanding the differences between early adopters and mainstream customers, and managing your own marketing and development efforts to cross this deadly chasm.

Here are the critical points that you must understand for optimal product management and marketing to maximize results from early adopters, as well as maximize your opportunity from the mainstream later adopters as well:

1. Collect feedback across the total range of customers. Early adopters may be the most vocal, and easy to sign up, but your technology assessment panel must include customers from the early majority, late majority, and even technology laggards. These last three groups usually comprise up to 85 percent of your real market.

2. Usability features are as important as function. Features you designed for non-technical users, including wizards for setup, dashboards for overview operation, and simple buttons for complex processes, will get little or no feedback from early adopters. They will request and be more vocal about technically tricky and elegant features.

3. Eliminate interface complexity and clutter. Early adopters are not intimidated by dense user interfaces, with more options to control the technology, and the flexibility to do almost anything. Regular users like to see more white space, and are more impressed with the Amazon patented one-click-buy button, to complete a purchase in one click.

4. Balance your focus on engineering elegance. Many technical entrepreneurs continue to “tune” the system, and add new parameters for users to worry about, simply because they can. At some point, this becomes compulsive engineering, and the tradeoffs in time to market, cost, and user friendliness move the product out of the intended market.

5. Early adopters are cool, so you need them to kick-start word-of-mouth. You certainly can’t afford to ignore early adopters, or antagonize them. They are your early opinion leaders, so they are required to build the image that the rest will follow. The challenge is to attract them with an innovative solution built on great technology, while still keeping it usable, timely, and cost effective for the rest of us.

Early adopters are a critical but small market segment that must be treated with respect. They can be your best evangelists or your biggest critics at that critical point when you are crossing the chasm to the larger mainstream customer segment.

But don’t ever be become complacent due to excitement and passion from your early adopters. You still need the same reaction from your other market segments, and an appropriate marketing strategy for scaling the business into other segments. Ten percent of even a large opportunity can still leave you in the valley of death, rather than the pinnacle of success.

Marty Zwilling

7 Tips To Raise Your Entrepreneur Instincts In School

A popular myth these days is that finishing college only dilutes your entrepreneurial instincts, and the best of the best, including Bill Gates, Steve Jobs and Mark Zuckerberg, dropped out early to hasten their success. I agree with Robert E. Litan, former VP of research at the Kauffman Foundation, that these are exceptions to the rule, rather than a model to emulate.

Some people even believe that entrepreneurs must be born with the right genes, and no element of education is relevant. While I do agree that many attributes of a good entrepreneur, such as curiosity, confidence and determination, are largely determined by early-life experiences, a good education is critical in understanding the elements of creating a business and wooing customers.

In my view, the most effective entrepreneurs are those with a background of an array of real-life experiences, both positive and negative, as well as good academic and coaching activities. In fact, failure has been shown to be a better teacher than success, so parents and schools who protect their charges from any failures may not doing them any favors in the long run.

While we all know a few good entrepreneurs who dropped out of school, the Internet is full of stories on many more who capitalized on at least four years of college, including Sergey Brin and Larry Page of Google, Chad Hurley of YouTube and Bob Parsons of GoDaddy.

A more important question, then, for an aspiring entrepreneur, should be what to study in college for maximum value, rather than whether to drop out or stay. Here are my thoughts on the right focus at a college or university:

1. Take entrepreneurship courses, but major in a more specific discipline. Depth in a specific business area, such as marketing or accounting, is important in understanding the internal and external processes of a business. Entrepreneurship is more about pulling all the elements together, making change happen and building relationships.

2. Practical business courses are better than an advanced degree or MBA. Starting a business is not rocket science. A breadth of understanding of common business principles, such as management, personnel and finance, is more important than a depth of knowledge in a technical area. Don’t forget business writing and communication.

3. Get involved in startup-business incubator activities with peers at school. Most universities have formal incubator and business development organizations that focus on coaching, grant writing and technology licensing. These present a huge opportunity to take your first steps as an entrepreneur with minimal risk and maximal support.

4. Produce a real business plan for critical feedback from outside investors. It’s important to go well beyond the passionate idea stage. Writing a business plan is the only way to determine if you even understand what your dream is all about. Once you graduate, the feedback will cost much more, and it’s too late to take one more course.

5. Extend your networking into peer interest groups outside your school. Start with your school connections with peer universities around the world. Then branch out to local business groups. Peers won’t be able to help you much in finding external investors, co-founders with prior experience and industry connections for distribution and marketing.

6. Find summer internships and part-time work in your field of interest. You can’t really learn all you need to succeed in any business domain from textbooks. The idiosyncrasies of supplier relationships, distribution and pricing are just as important as the generic elements of time and money management. Get real experience early.

7. Incorporate your first business before you graduate. It’s never too early to stop studying and start doing it for real. You will learn the most by facing the tribulations of establishing an LLC and dealing with insurance, personnel and tax issues. Remember, it’s the learning that counts, not the size of the bet or the ultimate success of your first try.

The best thing you can learn in school is how to learn -- fast and effectively. In the real world, change occurs very rapidly, so all the specifics you memorized from textbooks will likely be obsolete by the time you need them. Your academic credentials will have very little value as well. The value is in your ability to get new credentials in your business faster than your competitors.

If you are already in Harvard, and have proven that you learn quickly, then feel free to drop out and change the world. For the rest of us, a bit more practice before jumping feels like a better bet. We need all of you at your best.

Marty Zwilling

7 Principles for Keeping Work Discussions Productive

All of us have been on the receiving end of a difficult conversation at work, and many have had to deliver a hard message to others. Unless you are totally inhuman, none of these are painless, and we all wish we had some way to make them more meaningful and more effective. We all want to feel good about our work and relationships, and we want others to feel that same way.

During my many years in business, and as a consultant, I have struggled with this dilemma myself, and tried to offer clients the insights they needed, but never had a good answer. Thus I was pleased to see this topic addressed well in a new book, “Can We Talk? Seven Principles for Managing Difficult Conversations at Work,” by Roberta Chinsky Mauson.

Roberta is a recognized thought leader on improving employee engagement, and has consulted with many top-tier companies and achieved some great results. I agree with her principles, and outline them here, for approaching any conversation at work, especially difficult ones, and making them positive and productive, rather than emotional and confrontational:

1. Confidence - trusting yourself and the other party. Build your confidence first and present your side of the conversation in a way to keep the other person engaged and open enough to really hear your thoughts. You also need to take some time to build a trusting relationship with the other person, before jumping in and speaking your mind.

   The best way to build your own confidence is to solidify your purpose at work, and focus on results around that purpose. It's hard to be confident in what you're doing if you're not sure why you're doing it. When you show confidence, people will trust and follow you.

2. Clarity - making your point clearly and listening. If you want others to hear you loud and clear, be direct in your communication, choose your words carefully, and stick to the facts. Enter all discussions with an open mind, park your assumptions, and listen deeply. Remember that what someone else hears is dependent on their perspective, not yours.

   Too often, the main objective for people who are about to enter a tricky conversation is to get it over as quickly as possible. With that as an objective, you won’t make your point clearly, and you may not listen. Practice your message ahead of time, and stick to it.

3. Compassion - be empathetic and understanding. Empathy and compassion are the impression you display of how well you understand or feel what the other person is experiencing. These include not only the words spoken, but more importantly, your nonverbal cues and body language. Usually it helps to slow down rather than speed up.

4. Curiosity - asking questions rather than shutting down. Being curious and asking questions to learn more about a particular situation shows the other party that you’re interested in what they have to say, and helps to move the conversation forward. Be sure to not cross that fine line between coming across as curious versus sounding judgmental.

5. Compromise - earn respect by respecting others. When seeking common ground, focus on the why, keep your eyes on the prize, be open to all alternatives, and be willing to make concessions. Try to make the outcome a “win-win” rather than a “win-lose” result. Always be respectful of alternate views and perspectives that do not match yours.

6. Credibility - your word is only as good as your actions. Credibility isn’t a trait you are born with – it’s something you earn day in and day out. It’s your behaviors that matter – not your intentions. Remember that people don’t work for companies, they work for people they trust. Improve your credibility by being consistent, and owning your mistakes.

7. Courage - navigating the obstacles despite fear. Courage is the determination to move forward despite fear. The sooner you are able to deal with discomfort, the easier it will be for you to initiate a high-stakes conversation. Not taking action is never a solution, but not every conversation is worth having. In all cases, summon the courage to stand up for yourself.

As you can see, there’s a lot that needs to go into handling a challenging work situation, when your goal is to have a productive discussion, and need to continue to maintain a relationship with the other person.

The same principles apply, whether you are an entrepreneur, term member, or manager in a large company. Since these principles often take time to have an impact, you need to start your thinking and you focus now.

Marty Zwilling

*** First published on Inc.com on 09/24/2021 ***

6 Ways To Strengthen Your Base As A Business Leader

Most of you business leaders focus first on providing guidance to your team, but neglect self-leadership as an equally important dimension. In my experience, many entrepreneurs rely too much on the perspective of a trusted advisor, or try to emulate a competitor who is getting attention. Personal leadership is setting your own direction and making real decisions first.

For example, no one should be convinced that Elon Musk is following someone else’s lead as he charges ahead with Tesla, SpaceX, and other initiatives. Steve Jobs famously is quoted as saying, "Don't let the noise of others' opinions drown out your own inner voice." Of course, this kind of leadership has a big risk, since you have no one to blame if you get it wrong.

The challenge is how to develop that self-leadership in every aspiring entrepreneur and business professional role. As a mentor to many entrepreneurs, I don’t believe that it is only a birthright, and there are several key strategies, including the following, that you can learn and practice which will lead to success:

1. Give your own judgement a high priority in decisions. I’m not suggesting that you not ask for or ignore other views and data, but simply use these to incrementally bolster your own judgement and confidence. Then make the decision your own, before you use it to lead the team. Over time, your self-worth and your leadership performance will increase.

   Getting lots of input on important issues is always a good idea. It can help you be right when, without expert help, you might fail. But it can turn into a flaw if you're depending on other people's opinions because you have no confidence in your own judgement.

2. Solidify and demonstrate your personal values. Strong values lead to a perception of a strong character, which is the essence of a strong leader. A real business leader must have a set of guiding values and morals, which set your reputation in the mind of others, and improve your self-leadership perception. You can’t be a leader without values.

   Every person and every company needs a set of core values. Each opportunity and leadership decision should be looked at through the lens of these core values or you will create unnecessary self-conflict and failure with your own self-leadership.

3. Increase your own knowledge in areas of interest. Focus on becoming an expert in relevant areas, rather than relying solely on other people. This may mean attending industry conferences, taking college courses, or reading some key books. The more you know, the more self-confident you will be to make your own leadership decisions.

   In many cases, the challenge may just be your ability to market yourself, and what you know. It may be time for you to start your own blog, write a book, or volunteer as a speaker at public events in your domain. Make sure everyone knows your expertise.

4. Demonstrate integrity and strong ethics in all activities. How you communicate informally and spend your time is as important as the decisions you make as a leader. People expect their leaders to act with personal integrity in their private life, if they are to be followed in public decisions. Be open and transparent with the people around you.

   Personal and business ethics are more than just obeying laws. You can be perceived as dishonest, unprincipled, untrustworthy, unfair, or uncaring without breaking the law. Ethical leaders often do more than they have to do and less than they are allowed to do.

5. Display personal leadership often to build momentum. The more you use your new-found leadership ability, the greater will be your satisfaction and confidence. People around you will recognize that energy, and follow you more willingly. The result will be a self-fulfilling prophecy of quicker and better leadership, for you and for your team.

6. Celebrate every small success to build team confidence. Many entrepreneurs I know wait for that big event to celebrate their leadership. It’s actually more important to capitalize on all the small successes along the way, to build your momentum and everyone’s confidence in your leadership. You need this to weather the hard times.

In my experience, no title or amount of money will work as a substitute for self-leadership, or get you perceived as a business leader. In this very competitive age, with the current high rate of change in the marketplace, it behooves you to maximize your self-leadership, and be perceived as the business leader you always wanted to be. It’s never too late to learn and improve.

Marty Zwilling

*** First published on Inc.com on 09/21/2021 ***

Why More Sales And Less Competition Is Not Sufficient

Does your business have a visible positive strategy, or do your customers and employees still see your primary focus as closing more sales and killing competitors? Certainly that has been the strategy of many companies, and has worked in the past, but today’s customers and workers are looking for more. They want relationships, positive experiences, and a win-win for society.

With the pervasive and instant communication of social media and the Internet, businesses can no longer hide behind the mask of their own hype, either inside the company or outside. The right positive strategy is integral to claiming leadership as well as making it happen.

I just remember the classic book, “The Strategic Leader’s Roadmap,” by Harbir Singh and Michael Useem from the Wharton School, which provides some specific steps along the way. I believe these steps are especially critical to the success of entrepreneurs who are rolling out new businesses today. It all starts with setting the right company strategy, including these elements:

1. Inspirational statement of purpose and direction. The old mission statements declaring your intent to be the “low-cost provider” is no longer a motivating vision for employees or customers. Engaging visions today include elements of social and environmental responsibilities, as well as economic returns to constituents.

2. Market and customer positioning. Clearly focusing on the right market and customer profile sets your competitor differentiation. It starts with understanding the drivers of customer excitement in advocating your solution, and ways to strengthen relationships. When customers are excited, your team becomes more engaged and productive.

3. Customer and employee value propositions. What are the company’s solutions and practices that will be seen as win-win value by all constituents? Your managers and everyone on your team needs to understand how their actions and leadership relate to value provided. The strategy must drive leadership so that leaders can drive the strategy.

4. Competitive and leadership leverage. A good strategy provides opportunities for internal actions and leaders to optimize and extend a firm’s competitive advantage. This requires effective communication of intent, flexibility in implementation, and positive rewards for innovation and initiative in improving customer experience and quality.

5. Constant restructuring for future advantage. A strategy that does not evolve as the market changes is a losing strategy. The internal team must see a reward in fostering change and leadership, and customers must be energized by new and improved processes, practices, and solutions. The best strategies are dynamic, rather than fixed.

A positive business strategy allows you to lead strategically by mastering the elements of both, separately and as an integrated whole. The authors argue that strategic leadership is an acquired capability that can and must be mastered by managers at all levels. It needs to extend to the firm’s directors, as well as investors. Everyone has to think and act strategically.

Another growing force for strategic leadership is the evolution to globalization. New companies are automatically global in reach and visibility, which makes a lack of strategy more impactful, since there is no move to an alternate environment for correction and restart. You need to get it right the first time, or there may not be a next time.

Above all, no company can afford to confuse strategy with tactics. Strategy is the “what” part of the equation, and tactics are the “how” activities. Every business, especially startups, have limited resources to implement tactics, so they need to be totally clear on the strategy first. Even if you could unleash unlimited tactics, the results would be confusing and non-productive to employees and customers alike.

Business success is an elusive target – with over fifty percent of new businesses continuing to fail in the first five years. We are also seeing an increasing number of former leading businesses disappear from the scene, including Blockbuster, Kodak, and Sharper Image. Start with a focus on strategy, and keep it there. Maybe it’s time to check yours with your employees and your customers, and see how positive it is today.

Marty Zwilling