Tag Archives: Entrepreneurship

Entrepreneurs Who Don’t Pass the Grade

Can an entrepreneur be graded? What would the assessment look like? Jason Nazar, the founder of Docstoc, created a 55 question assessment to do just that. He posted it on Forbes yesterday and invited the reader to begin with the end in mind. The questions are listed below:

Checklist man

1. See opportunity where others see issues 

2. Have a discipline for making decisions among various opportunity costs

3. Rapidly double down on something when it starts to work and blow it out to its full potential 

4. Balance “gut decisions” with of a love of data-driven decisions

5. Focus on 

6. Stay attached to the problem they are trying to solve, but be flexible in the solutions to solve it 

7. Know when to apply a 

8. Protect their downside and prevent the organization from being put at risk

9. Communicate expectations clearly, build buy-in and hold everyone accountable (most of all themselves)

10. Encourage open feedback on what they can improve

11. Put others in positions to make critical decisions and drive key initiatives forward 

12. Prefer to give credit than to take credit

13. Do, or have done, what they ask others to do

14. Remain organized and disciplined in any work habits that affect others

15. Seek out and follow the council of advisors in and outside of the business 

16. Balance “Coaching and Cheerleading” vs. “Doing and Directing” 

17. Know when to set unrealistic goals

18. Regularly thank and appreciate others for a job well done (thanks to my co-founder Alon Shwartz for reminding me)

19. Make themselves consistently accessible to their team

20. Are honest and ethical in all their dealings

21. At least 20% of their time goes towards recruiting top talent (tip: some say 50% via Vinod Khosla)

22. Build a team of A vs. B players

23. Define the most important qualities for hiring 

24. Counter-balance their weaknesses by hiring people better than them

25. Hire Fast & Fire Fast 

26. Define what the culture should be

27. Create an ingrained culture, not one of platitudes 

28. Make the culture about something bigger than business 

29. Build ownership and accountability across the entire organization

30. Put in their own capital before they ask others to put in theirs

31. They sell ether, sell the dream

32. Have mastered the investor pitch process

33. They first sell themself

34. Understand “People, Product, Progress, Passion, Persistence” 

35. Always ensure the business is properly capitalized 

36. Treat investor’s capital like a borrowed treasure to be protected and returned

37. Know their product better than anyone else

38. Regularly talk with customers to see what can be improved

39. Have a vision for the product that gets translated across the organization

40. Make their product different and better than the competition

41. Build lean products iteratively and ship expeditiously

42. Genuinely care about the interests of the customer more than their personal financial gain

43. Focus on execution over ideas

44. Participate in key sales functions and deals 

45. Spend enough time courting key relationships that move the business forward

46. Great at generating PR and buzz for the company 

47. Listen more than they talk 

48. Stay scrappy as they grow 

49. Have a strong sense of demand and how to extract it 

50. Self aware, willing to admit mistakes and take responsibility

51. Fierce competitiveness, hate to lose

52. Extreme sense of urgency and intense work ethic

53. Have a big WHY 

54. Can sell the dream

 

55.) Do they get results with integrity?  That is the only standard by which entrepreneurs are eventually judged.  Everything else is just a test; grades don’t matter, but results do.

 

What a great and wise summary of what’s most important! When Nazar sums it all up in the phrase “results with integrity,” he eliminates all doubt as to what is really the key driver in successful leaders–be they entrepreneurial, intrapreneurial, or otherwise! 

You Can’t Handle A Business Plan!

In preparing for battle I have always found that plans are useless, but planning is indispensable.

-Dwight D. Eisenhower (Thirty-fourth President of the USA)

 

Eisenhower was a military leader of renown prior to becoming president.  His comment on the value of planning illustrates a key point that many who disdain planning would do well to heed: a plan is not the goal, but rather the exercise of thinking strategically through one’s options given a defined situation and set of resources at one’s disposal.

Serving entrepreneurs and existing business owners, I have seen the outcome of both lack of planning and belief that planning unto itself is a cure-all for potential challenges that may come the way of the enterprise. Tim Berry, author of Three Weeks to Startup, writes that, “If you’re serious about starting your business — even if you don’t have anything down in writing — you’ve already started to plan.” Yet, starting to plan is not the same as writing a business plan.

There are several planning steps that I would recommend prior to writing a business plan:

  1. Refine your idea. Think through how your business model would affect potential customers. Have a preliminary strategy in mind for each segment of your target audience.
  2. Conceptualize a winning strategy. Think through what is already available in terms of direct and indirect competition. Adjust your approach to the market based on what can win consistently.
  3. Create value before your first sale. Test your hypothetical product features and benefits, along with pricing model and go-to-market system. Secure feedback and revise your offering accordingly.

Once you have thought through these three main ideas, you are then ready to evaluate how best to launch a business. Evaluation is the point at which your first business plan should be written. Berry recommends “Your plan is for you first. Don’t make it for anybody else. Do it because it helps you divide and manage big goals into practical steps. Instead of looking at it as a document, think of your business plan as a place on your computer where you collect ideas, useful stories, lists and numbers. It’s a place where you keep track of the market, your milestones, goals and projections.”

Business planI could not agree more wholeheartedly! A plan is not a monument; it is a living, flexible document that needs to be modified on a recurring basis as long as you are in business. Early on, Berry recommends the following key components of planning:

  • Milestones: What’s supposed to happen, when, and who’s responsible.
  • Basic numbers: Simple spreadsheet projections for sales, costs and expenses.
  • Strategy: Strategy is about deciding how to focus a business offering on a key target market. It can start with just bullet points. I’ve seen it done well with pictures. It’s mostly a reminder for you and your team.
  • Cash flow: Because profits don’t guarantee enough cash to pay your bills, you need to manage cash from the beginning. Month by month, account for what you spend and what you deposit — not profit as it appears on the books, but money as it shows in the bank.
  • Review schedule: Set aside time for a plan verses actual review once a month to compare what you planned would happen in your business to what really happened. Be brief and practical.

Regardless of your market niche, whether you have attended a “hack-a-thon,” or who is on your start-up team, take the time to consider each of these components thoughtfully. Incorporating them into a plan that you are committed to revisiting and continuously improving will enhance your chances of launching a successful new business!

 

 

Risk a Mistake; Earn a Valuable Lesson

 

Entrepreneurship is about taking risks. With risk taking comes the chance for failure. Failures, however, need not be a detriment to success. Quite often, they can be the building block. Matthew Turner is currently writing a book called The Successful Mistake: inspiring tips, tricks & tales from 250 successful entrepreneurs. The premise, he writes, is to interview business people and discuss their mistakes and how they turned them around. In a blog post for under30ceo.com, he shared some of the thoughts that will be in the book and a story of struggle from Richard Branson:

Mistake Or Valuable Lesson?

Having interviewed dozens of inspiring individuals I’m beginning to connect some rather important dots. Often the difference between a successful person and everyone else is how they react to adversity.

Bad things happen from time-to-time, and we’re often left with a rather simple decision: Fight or Flight

Yes, that natural instinct of fighting or fleeing comes to mind, and those successful entrepreneurs that build empires are often those that fight…fight…and fight some more. Success is rarely handed on a plate, and I’d like to share (a) Famous Entrepreneur who had to find success the hard way:Mistakes

Richard Branson

In 1971 Richard Branson was just starting to grow Virgin Records, and although things were going rather well, money was tight and tough times lay ahead.

His mistake began when he won a contract to export records to Belgium, and after a few things went wrong, he realised he could avoid certain UK taxes by appearing to export but never actually doing so. His debts would soon be cleared and all would be well, but this little idea was illegal, and as with all illegal matters, the risk is high.

As you can imagine the Tax Man came knocking and Richard Branson spent a night in jail and was forced to pay a rather hefty fine. Yes, the same Richard Branson that so many people idolise (including me).

What Richard learned was that his reputation is his biggest attribute, and no amount of fame or fortune can replace it. He vowed in that jail cell that he would never return, and this mistake helped him build a certain set of values that he’s since lived to. As with most wealthy people he’s no doubt faced occasions where bribes and ‘loopholes’ could have been taken, but he’s learned his lesson from a rather large and potentially devastating mistake. This error in judgement could not only have ended his business, but tainted his entire life.

Mistakes can shape our destiny. As you can see in Branson’s story, there are people who can take the proverbial lemon and turn it into lemonade. Clearly, his experience has shaped his drive to become the dynamo businessman esteemed by many today. Think about your own experience…what have you done that, when it happened, you wished you hadn’t, but in retrospect would not trade the lesson learned for anything?

Moving beyond mistakes in the past, think about your current situation. Does fear of being wrong or making a mistake hold you back in a key decision that you are considering? Are you paralyzed with apprehension about what may go wrong with a pending strategic move? There must be a balance between due diligence and postponing risk taking for fear of failure. We can overcome most failures and become better for the experience. Are you willing to risk it?

Pieces of 8 Need to Become All of 8

Have you ever heard the phrase, “work on your business instead of in it?” Michael Gerber (he of the E-Myth book notoriety) popularized this concept if he didn’t invent the phrase. Gerber chastises business owners for trying to do everything instead of doing the strategic things that will grow the business. He points out that the “jack of all trades,” “chief cook and bottlewasher,” etc epithets are crutches and should not be celebrated. Instead, he recommends systems over personalities and methodologies in lieu of gut instinct. 

Many years after writing the E-Myth, Gerber is still speaking, writing, and training. A blog post earlier today at Inc.com addressed what he considers to be the 8 Essential Parts to a Business (And How They Work Together.) He begins by saying that one “must understand that a small business is a system in which all parts contribute to the success or failure of the whole:”Model T assembly

Like Henry Ford understood the relationship between the Ford Motor Car and the Ford Motor Company (which manufactures, sells and services the car), you must understand the connection between all the parts in your business and how your company relates to the world.

Here are the essential parts of your business:

1. Consumer

Perhaps you’ve spent your life working in an industry. You know all about that industry from the inside. But building a business requires going outside. You must consider your customer’s needs first and foremost.

2. Competitor

Every customer is being pursued by other companies in competition to yours. They are all making offers to solve the same problem your business solves. Your job is to analyze those solutions, and know how yours is better.

3. Channels of Distribution

There are numerous channels of distribution available to you, but you need to know which ones are most effective for your business. The channels you ultimately choose will determine your reach and your cost.

4. Media

How will you get the word out about your business? You could get on the news by doing something newsworthy, or by buying advertising. Get yourself out there as often as you can.

5. Financial

This involves capitalizing your new venture. Likely, your first steps will be bootstrapping–or financing through yourself and those you know. Down the road, investors may be a possibility, but all the pieces of your business must be running smoothly.

6. Strategic

The strategic part of your business is what happens inside it. They include Strategy, Marketing, Operations and Finance–the four essential functions in your business.

7. Tactical

The tactical aspect of your business overlaps into Marketing, Operations and Finance. This is the execution of the strategy that you have created.

8. Incremental

All the work done by the workers in your business falls into this category. The tactical part lays out the tactics, the incremental part performs them.

You can tell that Michael Gerber is no novice when it comes to entrepreneurial matters. He has a keen ability to cut through words and phrases that are over used, and therefore meaningless, to succinctly get a point across. His entire hypothesis is that a business is an organization of many individual parts that work together in processes not unlike the human body and its respective systems.

When one component part is malfunctioning or misguided, it affects the other parts. Collaboration, synergy, and harmony arise when we achieve coordination of effort. Such clarity masterfully improves operating performance!

 

Fly High, Entrepreneur, With 3 Key Skills

There are great minds aplenty when it comes to individual business disciplines (marketing, finance, quality, social media, etc). Rare is the individual whose thought leadership spans effortlessly from one to another. Seth Godin, however, is one of those truly bright minds who “gets it” on many fronts. His Twitter posts are very interesting to read and his books are well respected. Godin’s most recent, The Icarus Deception (Portfolio, 2013), is described below by Amazon.com:

The old rules: Play it safe. Stay in your comfort zone. Find an institution, a job, a set of rules to stick to. Keep your head down. Don’t fly too close to the sun.
 
The new truth: It’s better to be sorry than safe. You need to fly higher than ever.
 
In his bravest and most challenging book yet, Seth Godin shows how we can thrive in an econ­omy that rewards art, not compliance. He explains why true innovators focus on trust, remarkabil­ity, leadership, and stories that spread. And he makes a passionate argument for why you should be treating your work as art.
 
Art is not a gene or a specific talent. It’s an atti­tude, available to anyone who has a vision that others don’t, and the guts to do something about it. Steve Jobs was an artist. So were Henry Ford and Martin Luther King Jr.
 
To work like an artist means investing in the things that scale: creativity, emotional labor, and grit. The path of the artist isn’t for the faint of heart—but Godin shows why it’s your only chance to stand up, stand out, and make a difference.
 
The time to seize new ground and work without a map is now. So what are you going to do?

Fall_of_Icarus_Blondel_decoration_Louvre_INV2624In a blog post last week for Entrepreneur.com,  blogger Bryan Elliott cites three essential skills Godin mentions in the new book as being critical for every great entrepreneur:

1. Quiet your lizard brain.
We all have what Godin refers to as a lizard brain. He says, “The lizard is a physical part of your brain, the pre-historic lump called the amygdala near the brain stem that is responsible for fear and rage and reproductive drive.”  

Godin has written a lot about this in previous books including Linchpin and Poke the Box and cites author Steven Pressfield for further explanation — “As Pressfield describes it, the lizard brain is the resistance. The resistance is the voice in the back of our head telling us to back off, be careful, go slow, compromise. The resistance is writer’s block and putting jitters and every project that ever shipped late because people couldn’t stay on the same page long enough to get something out the door. The resistance grows in strength as we get closer to shipping, as we get closer to an insight, as we get closer to the truth of what we really want. That’s because the lizard hates change and achievement and risk,” Godin says in The Icarus Deception.

2. Think like an artist.
In The Icarus Deception, Godin challenges us to think beyond the norm and become artists. “It’s not art if the world (or at least a tiny portion of it) isn’t transformed in some way. And it’s not art if it’s not generous. And most of all, it’s not art if there’s no risk. The risk isn’t the risk of financial ruin (though that might be part of it). No, the risk is the risk of rejection. Of puzzlement. Of stasis. Art requires the artist to care, and to care enough to do something when he knows it might not work.”

3. Connect the disconnected. 

Godin writes about “The Connected Economy” and explains that the era where we needed to care about catering to the masses is gone. It’s about connecting people who are disconnected — then connection becomes a function of art. The opportunity in the Connection Economy is about finding the problem (where are people disconnected).

Can you make the transition to reduce resistance, seek to transform, and connecting others to solutions? If so, you have assets that will serve you well as an entrepreneur!