Getting Small Business

How Do You Run a Business with No Money?

2009-05-20T17:14:00.004-04:00

Please re-read the title of this with an emphasis on the YOU. This is not how-to run, but about how you operate, function, work in a business with no money. I had a discussion recently with someone facing this problem in their company, and he said, "You should write about that on your blog." It was an overdue push, given I've been suffering from a combination of writer's block and busy-ness of late. So, let's have a go.

I believe the example that might be most salient is that of a business that begins in parallel with a fund-raising effort. Many one-person businesses knowingly start on a shoestring, but larger efforts often begin with partners (both business partners and supporters offering their services) while outside funds are being sought. Things typically start with a flurry of activity and energy. The plan often includes optimistic assumptions about how quickly funds can be raised and time to revenues. As the reality establishes itself, the energy will cycle, but the need for activity remains and increases. On top of this, the needs of the business change quickly as more is learned about the business, feedback from investors, etc. Meanwhile, those involved in the business learn a lot about their partners and how they work. Herein lies the lesson.

Even at this point in my description, I guarantee that you have assumptions about how you and any logical person would function in this environment. There are two challenges in this. First, you do not know how you will function until you are in the situation. Second, I guarantee you that your assumptions about how "anyone in this situation" would act are not going to be true of your partners.

Let's get specific for a minute. After you have gone six months beyond your initial projections of when funding would be closed, how do you work with suppliers on work you need from them when you haven't paid their last two invoices? Do you use your credit card to buy that plane ticket for that industry meeting that will generate some good leads, but no sales for a year? Do you call your old boss or start looking for "a real job"? Does your spouse tell you to get "a real job"?

Many people will put heads down and plow ahead to get done what needs to get done, but the reality of money is the big strain. Some people become strategic and want to retrench or determine a new plan of attack, but the cost is time. Some people will curl up in the fetal position and need to be cut loose.

If we assume success for the purpose of this discussion (which I have seen perseverance often yields, although in a different form than you may have sought), you will also be amazed at the difference in how people operate after the first funding obstacle is cleared. Lifting the burden of running a business with no funding is a relief that can elicit a dramatic change. Some people view it as having been living a lie. Those who put their head down with less (or no) regard to money, will often show little or no change. But within a business, it is safe to assume that some partners will behave dramatically differently. This has an impact on the overall business, and this cannot be underestimated.

As is typically the case in my musings here, I will tell you that there is no right answer, but I am telling you that this will happen to many a new business. Consider your own situation and how this inevitable reality will impact you. Then consider your partners and the impact on them. It all adds up to an impact on your business, and it can be the difference between your surviving this trial or not. Good luck!

The Thrill of Hearing "Yes"

2009-03-25T16:12:00.002-04:00

Get your mind out of the gutter! I'm talking about the entrepreneurial rush from hearing a client say "yes" to your proposal. For those of you in the space already, you know of what I speak. For those of you looking out from the cubicle farm and wondering, I share this with you as something I had not fully considered before I began.

The experience has some important differences from the experience of a sale. Additionally, the rush can be found in establishing relationships other than just selling something. The reason is that in this space that "yes" is a vote for you. Work gets done in the smaller business space based on relationships. Nothing earth-shattering in that statement and it does extend beyond this arena, but it is particularly true with owners of small and mid-sized businesses.

Networking and relationship-building constantly present new and unique opportunities for entrepreneurs. All of these go through phases with their own highs and lows, but the "yes" is the final affirmation that the investment is paying off. What can amaze many is the pace at which you can get there. Entrepreneurs will operate on feel--sometimes for better and sometimes for worse. This eliminates many of the dances that lead to sales, partnerships, or other relationships in Corporate America.

While the "yes" is an indication that you are heading towards another payday of some sort, the lasting encouragement comes from the reality of attacking the work you anticipated during development of the relationship and the sense of control you have in making that reality a success. It tells you that someone believes in you--someone who you often did not even know a couple of months prior! They believe your vision, and they believe you will do what you say can do.

I've used other posts to provide some reality checks, but on a cloudy day with pending drizzle here in Virginia, I'll keep today's focused up. This is truly a unique reality for entrepreneurs, and one that you have to experience to appreciate. You got the "yes" and you are in control of fulfilling the promises. Congratulations, celebrate, and then go do it again!

Be Part of the Solution

2009-03-10T06:49:00.002-04:00

In the past week, I have had more frequent conversations with entrepreneurs and others voicing some degree of hope in the economy and wishing for a decrease in the media's dire and dour coverage. For some small and mid-sized businesses, this is a time for belt-tightening and holding on. For others, it is a time to expand and grow. The latter group does not typically get much attention, but they exist and it can happen.

It has struck me in the discussions with companies facing this growth opportunity that there is a really cool chance here to create solutions. There are great people out there looking for jobs. There is still money looking for investing in right opportunities (it's just different than the drunken sailor investment strategy of the past). Some of these companies are "new economy" and have huge upside potential with investment and the right strategy and execution. Other companies are "old line" companies in industries that stand to do well in the downturn. For both, the business opportunities have remained largely the same. Now, however, there is the added "cool factor" of being part of solving a problem of unique proportions. Seriously, how great would it be to know inside that the growth of your business is putting people to work and providing a valuable product or service at a critical time? Forget about stimulus checks from the government! These are proven, lasting solutions.

Part of me right now is picturing the philosopher Chevy Chase in Caddyshack instructing Danny to "Be your future. Make. Make your future." But the bottom line is that there is a very real opportunity here. I tend to be a (sometimes too) pragmatic thinker about strategy and execution, but look at the big picture here and realize the impact you can have. Embrace the opportunity to lead your business and create solutions.

There are plenty of other ways to contribute as well. A movement is afoot this week, in particular, led by Duct Tape Marketing. The effort is simply "Make a Referral" Week. Please check it out and sign up yourself. Mobilizing entrepreneurs to support one another, this group is pushing its own grass roots stimulus. Brilliant! Social media avenues spread this like wildfire as well.

That's it for the pep talk this week. To be honest, it was largely a therapy session to remind myself to keep my eyes on horizon ... above the current fray. Now, go make your referral.

Put your Network to Work

2009-02-25T16:26:00.003-05:00

I have had a fun experience just in the past five days on a new business idea that a partner and I have been kicking around. I can't tell you about it, because this business is (naturally) going to change the world! One really cool observation during that short period of time, however, is the extent to which both of us have been able to put our network to work.

This business idea has technical, operations, marketing, and risk considerations which are not unlike many new ideas. For every area in which we have had a question, we have had someone in our network to leverage. We have also been able to ask a specific set of questions for an area that avoids having to pull back the curtain on the entire idea (given that one potential challenge is low barriers to entry). One positive of being able to focus the questions and align them with the person's area of expertise is that you can really just let them roll and share their experience with you. In each case, this has provided a deeper level of understanding that my partner and I can then roll into our larger strategy. For example, a discussion around the financial risks of the idea lead to strategies for mitigating those risks--all from listening intently to people who know that area really well. We can then put that into the mix and have changed our thinking on the marketing based on that input. Again, all within 5 days.

Some of my other posts address building your network and fostering it. Effective network-ers are able to "tag" people in their network with areas of expertise. (They are also able to use "tags" other than "has money" and "no money.") This allows you to come back to them with opportunities and requests. The more you can make those visits about them, the more you will see that investment in your network pay off.

Understand your network and how you can leverage it. In the end, you will see that it is not a one way street. Your ongoing conversations and fostering of relationships will lead to unforeseen mutual opportunities.

Re-Defining a Successful Career

2009-02-11T15:44:00.002-05:00

This week, the Wall Street Journal had an article titled "You Might as Well Face It: You're Addicted to Success." The article, while somewhat disjointed with a couple of bizarre examples, points out the extent to which many in Corporate America define themselves by a job. In a time when lifetime employment was much closer to the norm, this might have been a safer bet. But for the current generations in the workforce, you will find yourself tied to a tenuous line. As a friend of mine once commented, "Be careful about loving your company, because it can't love you back."

This is a nuanced problem, to say the least. Why are we addicted to the success? On a practical level, people at all levels of the pay scale find themselves addicted to their paycheck. At the one end of the scale, it is understandable out of necessity. Above a certain point, however, it is simply shocking the extent to which a life (not just a lifestyle) is wholly dependent on the ongoing presence of the next paycheck.

On a psychological level, which I will avoid trying to explain, the addiction to success can fill a need for individuals to prove their worth to themselves or others. On a simple level, using your career as a benchmark provides handy, quantifiable metrics--pay, bonus, rating, title, etc. These black-and-white solutions are much easier to spout than the nuanced and challenging aspects of life outside of work. This may also be why the time spent on work often so easily consumes the time previously spent on those other areas. From here, I will leave the rest to Freud or others.

I will bring this back, though, to the need for your own definition of success. For those itching to leap into an entrepreneurial venture, you had better not covet the titles, pay, or other perks associated with a cushy corporate role. You have to be in it for the long haul, the longer-term rewards, and deeper motivations. Can you live with the new identity that comes with an entrepreneurial venture? Can you embrace it and be proud? You should.

If you truly can, the results will be evident. In fact, this month's INC Magazine has an article on angel investing in which one investor commented that money is still there for managers who clearly are passionate about and committed to their business. Get-rich-quick me-too's need not apply. If you can define (or re-define, if necessary) yourself and your measurement of success, then you have the beginnings of a can't-miss career.

Seek Dis-confirming Data

2009-02-05T16:20:00.002-05:00

I am currently working with two partners (I know, I know ... "partnerships are hard") on a new business here in Richmond and find myself being challenged with balancing the desire to get the business going versus paying attention to potential obstacles or pitfalls. To some degree my partners and I know from our own experience the primary issues to anticipate and address up front, but additional conversations lead to questions about how to make the business sustainable and successful.

Entrepreneurs can suffer from tunnel vision on achieving an objective without taking some time to put a strong foundation in place. In contrast, many suffer from being so scared by obstacles that it leads to inaction or reverting to a comfort zone. The right balance is found in acknowledging, filtering, and incorporating the challenges into your plan and actions. This can be done either by addressing them now (which is often difficult or impossible) or creating real options which allow you to make the decision in increments and/or later with additional information. (Real options plug: This may be the single most useful concept I got from business school. It's an incredibly simple, but applicable concept for small business.)

This objectivity can be difficult to maintain, however, in the rush and excitement to launch something new. There is so much that needs to be done. Additionally, you become emotionally invested in making the new venture a success. Challenges from others can be brushed aside or avoided. Resist the urge!

Keep your head and learn how to filter the comments and incorporate them appropriately. What would you do differently now in anticipation of a given challenge? Can you structure your new company or offering in such a way that you create flexibility to keep options open? Some questions may even push you to answers that increase confidence and clarity in your approach.

Hopefully this isn't too esoteric or obscure. I would think that you could quickly identify from your own experience and conversations the people and topics that challenge you and your path. What do you with them? If you dismiss them out of hand, you run a great risk. If you become obsessed and paralyzed by them, you run a great risk. And if you have a hard time maintaining this objectivity, leverage an adviser or friend who can keep you honest. There will come a day for your business, when you will be glad that you addressed the issue ahead of time.

Layoffs: Pushed out of the Nest

2009-01-27T13:13:00.003-05:00

Most of my posts encourage those within Corporate America to be proactive in taking steps towards entrepreneurship if that is in fact a long-term goal. Within the fabric confines of your cubicle, you will not intersect the sphere of small business unless YOU take steps to do so. For many, however, the new reality is a rude awakening to the fact that corporate jobs are not as safe and cushy as one might think. Laid off employees are also made harshly aware of the lack of support from empty tools such as COBRA.

There's a broad set of implications to consider at this point for those who have been kicked out of the corporate nest. For example, absolute income needs, severance, and health insurance options (unsolicited advice: dental insurance is a racket!) can be decisions that lop off entire branches from your decision tree. Beyond the objective set, there is the subjective "what do I want to be when I grow up" questions to consider given your new "opportunity."

There are plenty of sites and people to give you more than enough advice on managing your job search, but I suggest you specifically consider an approach that incorporates what I broadly define as small business. Many view this path as too risky or beneath a Corporate America gig. I find these to be short-sighted arguments. You've just had proven to you that Corporate America is not the land of lifetime employment, and you are likely to find a crowded field competing for the next corporate opening.

Spend some time and energy outlining a plan for small business. The three most important things are networking, networking, and networking. You should have more meetings at Starbucks and Panera than you even thought possible. (Entrepreneur secret: It's called Panera Bread, but their bakery stuff really isn't very good ... but it's worth it for free wifi.) Informational "cup of coffee" meetings can lead in directions you never envisioned. I hazard to guess that you will find the conversations stimulate a part of your brain that you forgot you had.

Once you have that ball rolling, look for ways to be creative in your approach. Work in smaller businesses can take a variety of shades. You won't find job postings and interviews conducted in a traditional or consistent manner. Get used to it and leverage that! It puts you on more equal footing than an interview for a job that tends to give the company the upper hand. Instead, you can identify ways to work together on projects, hourly basis, etc.

It's not all sunshine and roses, and it can be time-consuming. I merely encourage you to consider the options you have in front of you. Be realistic about those options. Assess your position and then move aggressively. I will remind you too that any step in the general direction of your goal is better than where you started. Avoid the trap of developing the perfect plan to reach an overly-defined goal. And good luck.

Partnerships are Challenging: Part Two

2009-01-15T20:42:00.002-05:00

About two months ago, it occurred to me that I had not yet addressed a common approach to small business -- the partnership. After my first post on the topic, I had several conversations with folks who seconded that experience, suggested other challenges, and/or tried to guess at partners of mine that prompted the post. I figured it was about to time to revisit the topic, however. This time to discuss assumptions and goals when starting a business.

An alarming number of partnerships begin without clear discussion among partners of what individuals are hoping to achieve for the business and themselves. If questioned, the response is often along the lines of "we're all on the same page", "well, naturally we all want to _____", or "we got started so fast we didn't have time for all that stuff." If you find yourself currently in a partnership or starting one and have heard you or your partners utter statements similar to these, beware!

I have encountered no other circumstance in business where there is a better example of "when you assume, you make an ASS out of U and ME." Many small businesses are wrecked when the reality of disparate goals and drivers are brought to the light of day. Whether it is the strategy of the business or the hours you keep, the differences can be stark and, if you are not careful, toxic.

It is amazing, however, that the exact same differences can be reconciled and often improved through early-stage conversations. If necessary, you can find facilitators to help you in shaping the vision of your company from strategy through execution. Either way, the discussions are critical to have sooner rather than later.

Personally, I have seen one of these facilitated exercises that drove to the values of a partnership (and the company). Putting individual opinions and ideas onto white paper forced an incredibly rich conversation. The result of which was a set of company values that endured and guided every difficult decision the company faced. The values then drove the discussion of the vision - mission - objectives.

It was not all wine and roses from that point, but the partnership was much stronger for the exercise. From my experience, there is no greater indicator of a successful partnership that can endure than the ability of the partners to communicate and that inevitably starts at the beginning. Don't forget that in small business, there is no place to hide. You and your partners must learn to live by a set of shared principles to see your company through. The ties within that partnership will be tried at the best and worst of times.

Is Yours a Job or a Calling?

2009-01-06T16:29:00.004-05:00

I'm back from the holidays with a bit of a philosophical post to start the year. Over the holidays, I read an article by Michael Lewis that he wrote in response to Wall Street'ers displaced by the economic fallout. The article encourages the recipient and others to determine whether they are looking for a job or for their calling. I also found the responses rather interesting. What I found interesting in the tone of both was the extent to which this question is new or absurd to those in this space. The rats in this particular race are often excused for their lack of attention to this point given the money to be made in the space. With that changing, Wall Street'ers (I thought of using Wall Streetwalkers, but relegated it to parentheses instead) are left to ponder the same question as so many others.

I am also reminded of this point given the scant number of those in the world of finance that seem to have found their calling versus a high-paying job. One of these is an old friend of mine that I had the good fortune to see over the holidays. His discussion of the current situation is both objective and confident. He has been fortunate to find his calling in a space that pays him well for what he really enjoys doing.

The beginning of the year is an opportunity to assess the fit of what you do with what you want to do. If you are in a position of trading hours for dollars, that might be the right place for you right now. But if you keep your eyes on the horizon and consciously take steps in the direction of your goal, you will continue to put yourself closer to that point. Movement is the key, not planning for the perfect path. Michael Lewis' article takes aim at Wall Street as the topic he knows the best, but his points remain important across the professional spectrum.

For those of you less familiar with Michael Lewis, you will see his book Hardball on the right in my recommendations. His book Liar's Poker is also a particularly timely read. Finally, his recent cover story in Portfolio is literally unbelievable.

Take Advantage of the Slow Time

2008-12-22T14:48:00.002-05:00

The holidays are notoriously slow. In fact, one of my Corporate America pet peeves is the oft-spoken rule that "nothing will get done between Thanksgiving and New Year's." It seems to become a more ingrained self-fulfilling prophecy every year, but the slower pace can also present opportunities for you to focus on creating options for yourself.

Here's a quick list of suggestions to seize on during the holidays:

Books. Hit the bookstore and grab a couple of those books you've been meaning to read (see my Amazon list on the right for some suggestions) and to find some new jewels. Begin with a clear focus on topics to make sure you don't end up walking out with another Dilbert book (understandably irresistible to the cubicle crowd). Then get out your pencil for note-taking and dive in!

Online Research. Dig around the internet and read up on small business / entrepreneurship. I have not found it to be the easiest of topics for this, but see what you can find. You can get through a lot of the internet in an hour! Pop open the laptop and do some digging while you watch It's a Wonderful Life for the umpteenth time. INC magazine's site isn't great, but it's not bad. Norm Brodsky's articles are very good. If you don't get the magazine in the mail (and at $15 a year, there's no reason you shouldn't), go back and read his. I have come across one other blog on a topic similar to mine. She's been working on a book (Newman! She's beating me to it.), so her posts are less frequent of late, but try the archives. Get out on this world wide interweb thingy and see what you can see.

Networking. Not everyone is out of town during the holidays, so drop that excuse. And for people with company in town, many would relish the chance to get out of the house for just about any reason other than shopping or returns. Reach out and see who else might be around for the holidays to help you expand your network. For those in town, it's a great time to avoid work, school, and other conflicts.

Conversations with Family and Friends. I include this one, because you are probably think, "What in the world can I learn from that cousin that used to make fart noises under his arm when we were kids?" Well, that cousin probably thinks the same thing about you and your ability to make milk spray out your nose! But you've both changed (hopefully!) and might need to find some new topics of conversation. Ask questions and then ask some more to learn what you can from relatives that might be in areas of potential interest to you. Warning: This one's certainly not foolproof, but it's worth a try. Also, you know those holiday parties you dread (especially New Years)? Take the opportunity to meet new folks and ask lots of questions. Make connections. I guarantee that you will come away with a couple of interesting new additions to your network.

Finally, if you are going into the office during the holidays, it's also a time when you frequently find you get your "day's worth" of work done in about half of the time thanks to fewer meetings and other distractions. Take advantage of the flexibility and efficiency to make some progress on multiple fronts. You'd be surprised what actually can get done in December!

And with that, I hope you have a Merry Christmas!

Discovering Servant Leadership

2008-12-16T08:32:00.003-05:00

Joel Spolsky's articles in INC magazine are providing a consistently strong accompaniment to Norm Brodsky's monthly missives. Joel's article this month was on servant leadership. He provides a particularly impactful personal example of witnessing and his own recent example of practicing servant leadership. It is an often overlooked opportunity in small business that can have deep and long-lasting impacts on your organization.

Corporate America provides fewer (or at least different) opportunities for servant leadership. Consider the opportunities that abound in small business: picking up the mail, making coffee, cleaning the bathroom, taking out the trash, running to Target for Folgers/toilet paper/a box of pens, addressing Christmas cards (maybe try that one today!), replacing light bulbs, .... Those are all provided for you in Corporate America. Warning for those of you in Corporate America, if you are the type of person that leaves the coffee pot empty, then you might struggle with the list above.

The point of the list above is not to say that you as the budding entrepreneuer needs to take care of all of those all the time, but a good rule of thumb I've been told is "don't ask someone to do what you will not do yourself." If your teammates see you delegating or ignoring all of those things, then you are sending clear signals about your priorities. Believe me, toilet paper is important to people!

If you have a list of objections for me at this point, I can assume what they likely are. "I'm busy with running the business.... I don't have time for these details.... I will hire someone to do all of that...." For one, your business might not be able to afford the cost of delegating all of these. Secondly, and maybe more importantly, the time required to make this commitment and the return you can see on that investment would make it worth your while to carve out the time to address them yourself.

By displaying servant leadership, your people will respond by giving more of themselves in return and picking up other small things around them because they see you doing that. All ships will be lifted with the tide and the business will see the impact. In return, your objections above will be addressed by the team's overall performance and responsiveness to your leadership. So, pick one or two off the list and make them part of your routine. Servant leadership is simply part of being an entrepreneur and a small business leader.

Rattling Your Corporate America Cage

2008-12-10T10:45:00.003-05:00

I always find the job numbers thrown around in the news a bit difficult to digest. Sometimes big numbers are small percentages. Typically big cuts at small businesses are not even mentioned. Often there are qualifiers to the cuts such as early retirement, not filling open slots, etc. Recent months have brought a slew of job numbers across the economy, big business, and even some small businesses. The workers at Republic Window and Door in Chicago are a notable example. Here in Richmond, Circuit City, Land America, Qimonda, and others fill the news with cuts at all levels of the organization.

My suggestion is that you focus less on the numbers and the news and consider what lessons you can learn from the current environment. Here are a some ideas for you:

1. Beware your faith in your Corporate America paycheck.
I am reminded of an old adage to "buy as little car as you can stand and as much house as you can afford." The prior is always true, but the latter is also predicated on the thinking that your mortgage payment (before taxes) stays the same in a fixed rate loan and your pay will go up as you get raises. Not necessarily a bad strategy, but consider how many areas of your life are connected to today's paycheck AND tomorrow's larger one AND your bonus AND .... These are the financial corners into which many people paint themselves that prevent them from being able to consider other career options (ones that cannot support that financial pyramid) and make any hiccup in any aspect of pay a cataclysmic event. Of course, it doesn't help dissuade this thinking when the American consumer is implored to SPEND! in the spirit of patriotism and national interest. (Brief soapbox tangent there, so I will stop but I will avoid going back to delete the sentence.)

2. Root for some form of national health coverage.
This is the one that always raises the most eyebrows. I'll quickly give you my arguments. I have innumerable conversations with people who use their health coverage in Corporate America as a primary reason for not pursuing their entrepreneurial dreams. For some this may be a red herring, but for many it is a true, harsh reality. I have been fortunate to have good enough health to be able to pursue my own options for health care, but any hiccup in your health can shut this door in an instant, thereby truly eliminating this option for people. This leaves someone no choice but to pursue only those opportunities that provide health care. I am not saying that the government would necessarily run programs better, but I believe that the blind faith in business-based health care is not without its own major flaws. [NOTE: Feel free to comment below on this one, in particular. It's always a topic sure to stir debate!]

3. Create options for yourself.
Some people feel that it is dishonest to be looking around for other jobs while at their current employer. Poppycock! (There's a word that doesn't get used enough.) As long as you are fulfilling the duties of your job and not surfing Monster all day or mentally checked out (an unfortunate, ongoing struggle in many corporations), there is absolutely no reason for you not to be networking constantly. There is not a thick black line between looking for a job and not. Keep discussions going and see where they may lead. Answer the calls from reputable headhunters. Beware of loving a corporation, because it can't love you back. Besides, a great piece of advice I received was that considering other jobs either confirms you are in the right place or leads to a better opportunity. That is a great set of options!

Can You Work with a Variety of People?

2008-12-04T14:19:00.002-05:00

This may sound like an odd question to which you would automatically answer "yes," but I will tell you that for many people that would be a lie. Realizing this too late can be catastrophic in small business. For example, if you've been cooped up in Corporate America with the MBA crowd your whole career, you might be wildly out of your element with the machine operator out on work release. (Link graciously provided for those of you that just said "What is 'work release?'")

Personally, I have enjoyed the jobs I have had where I have interfaced with both the boiler room and board room. I love the variety. Maybe it's the engineer in me that still gets a charge out of talking to the line operator. I have also seen the extent to which others can struggle when thrust into a situation with one or more of the groups across this spectrum. And if you don't know how to interact with a certain group, your biggest mistake will be to try and fake it.

Most entrepreneurs will run the gamut from bankers to adminstrators to salespeople to maintenance to purchasing to operators to lawyers. And that's probably all in the same week! There are a couple of risks of which you should be aware. For one, many people will consciously or subconsciously avoid the groups with which they are least comfortable. Danger! Another risk is that you can get taken advantage of when you are visibly out of your comfort zone.

Therefore, it is not a topic to be overlooked when considering small business opportunities. You can either steer yourself towards opportunities more in your comfort zone or be aware of the challenge and mitigate it with your teammates and/or a focused effort on your part. This can be one area where a personal coach or other reliable resource can help expand your comfort zone and your skills.

Both internally and externally, your interpersonal skills will be of heightened importance in small business. Much gets done on trust and relationships in this space. And the inverse is true too. You can't hang up a banner proclaiming "People are our Greatest Asset" if people do not see it in your actions. In small business, actions speak much more loudly than motivational posters! (For those of you still in Corporate America, see Despair.com for some amusing alternatives.) So much is of heightened importance in small business, and your ability to connect with people is not one to be taken for granted.

REQUEST: Last week, a friend of mine emailed with some suggestions for post topics. Please email or share those in the Comments. I'd love to hear it. My goal is to sustain two posts per week, so variety helps.

Managing Yourself in a Home Office

2008-12-02T10:59:00.003-05:00

For those considering the move to small business, the ability to work at home at any hour is an important consideration. I've had the pleasure of having my car in the shop for the last two days, which has forced me to work from home more than I have in the last few years. It is interesting how a couple of days of this bring back the challenges and the adjustments necessary to succeed in this setting. It is certainly not something to take for granted.

I am fully aware of its upsides--wearing slippers to work, cranking my favorite Pandora stations, going for a mid-day run, etc. There are several other negatives or, at minimum, double-edged swords. Some are clear--seeing the kids, random doorbell rings, etc. One that is often taken for granted, however, is the ability to stay focused and get work done.

For those of you coming from Corporate America, take a minute to stop and think about a day with no meetings. How would you utilize it? Specifically. It's a tougher answer than you may first think. Some struggle with limits on the above pros and cons. Others simply struggle with keeping their head down and getting productive work done. This point can kill an entrepreneur. Your time is more precious than you think.

I am no expert here and certainly have my own challenges, so this post is not intended to provide a magic recipe. 'Boundaries' is my one word of advice. Give it a day and you'll know what I'm talking about. As for managing your time, I can say that there are some useful points in a book by David Allen called Getting Things Done: The Art of Stress-Free Productivity. Some people that I know and admire absolutely swear by this book!

The important thing is that you find your own solutions. As mentioned here multiple times, small business has a way of permeating your life. In general, I find this to be a bigger pro than a con, as long as the business is one that you love and can abide having permeate you life. It is critical, therefore, that you find ways to be productive at home. So before you sit down with cell phone in hand and computer on lap, outline your plan for making sure that you can be your own boss and do what you need to do in that potential black hole called 'the home office.'

Job Security, Where Art Thou?

2008-11-17T11:20:00.004-05:00

This is not an "I told you so" post, but I would suggest that now is an opportune time to consider personal biases about job security. Personally, I'm not sure that such a thing exists anymore, but for those that do, I think it's hard to argue that Corporate America shares your opinion. See today's news from Citi as just the latest example. It is simply the latest, unfortunate example of the need to keep your head up and look out for yourself. Here in Richmond, we continue to watch the slow, painful death of Circuit City. Some of the quotes coming out of those let go remind me of the admonition to be careful how much you love a company, because it can't love you back.

Reframe your thinking about skills and the investment you are making in your future. This month's INC magazine has an interesting article that helps to reframe the influence of small business in America. How are you investing in your future?

Job security is up to you. It is imperative that you create and build a strong and competitive skill set. It may be easy to think of job retraining and job loss as something that happens to auto workers in the Midwest, but the current changes are broad and large. As the country's economy evolves beyond manufacturing, the impact of job losses are necessarily going to extend beyond the traditional sources.

Small business can also be an area where your skills are more essential and flexible. These are key variables during a downturn. Cuts at major corporations are made at an impersonal level. You have an ability to establish your worth in the small business space and also to extend a network of contacts to many businesses that operate in this space relative to the smaller number within Corporate America's industry verticals.

Some food for thought during these rapidly changing times.

Partnerships are Challenging: Part 1

2008-11-11T21:08:00.005-05:00

In a class in business school on purchasing companies, the professor said on multiple occasions that "partnerships are hard." It occurred to me recently that I have yet to write a post on this topic directly. One reason that I call this point out in particular is that many people take it for granted. For those coming from Corporate America, you may have the experience of being able to escape those with whom you have challenges. In small business, however, there is no place to hide. And when you are partners, you will learn the extent to which many things you take for granted (priorities, decision-making, etc.) are not necessarily shared by others.

I definitely do not go as far as some to say "never have partners." I believe and have first hand experience with the benefits that you can enjoy (that will be a separate post), but these benefits can be quickly overshadowed by the challenges if you are not alert. Rather than a litany of the challenges, let's focus on one.

Shared focus is one challenge within partnerships. In small business, organizational structure is typically either non-existent or less meaningful than in Corporate America. One result is more of an "all hands on deck" approach. Another result can resemble "swarm soccer" (think: 6 year old soccer game where positions mean less than chasing the ball). For those looking to stay within lanes, this can quickly become frustrating. For those looking to micro-manage, you will quickly frustrate those around you.

The solution (are you ready for this?) is communication. Ta da! Seriously, though, there are ways to define roles and responsibilities and to invite group participation when appropriate. For those who can't wait to jump into someone else's business, your challenge is to give direct feedback if that is the heart of the matter rather than the passive-agressive approach of bypassing this and just jumping in "to help."

Successful partnerships rely on establishing clear expectations. I would suggest focusing less on trying to translate that into an org chart, since it will likely be obsolete by the time the ink dries. Do focus, however, on roles and responsibilities and establish communication intervals and vehicles that work. Setup check-in's every other day at 9am and make them sacred, for example.

Partnerships can work and may be necessary in certain businesses, but beware the rose-colored glasses. Raise the bar on your communication and keep an eye out for the assumptions that I guarantee will come back to bite you later.

Small Business Consulting Opportunities

2008-10-29T08:36:00.003-04:00

Many people overlook one straightforward way to get into small business opportunities--consulting. Beware, however, that this is often a four-letter word in the small business space often associated with the big business version---a.k.a. either "you pay me a lot of money, I give you a three-ring binder, I walk away" or the dreaded "Bobs" from Office Space. The opportunities with small business are many, however, if you look at the fundamentals--the business is in need of an outside perspective, expertise, and/or hands to do work without making a full-time commitment. Your ability to bring some combination of those to the table present an opportunity to make a match.

For you, the benefits can extend beyond financial. An opportunity to engage with a small business broadens your base of experience and expands your network. This combination often leads to unenvisioned opportunities.

A good relationship starts with clear agreement and understanding by both parties. Be aware that many small businesses rely on getting gratis advice or support from their network. Define the boundaries of your relationship for scope, time, and money. Holding to these can be difficult as you get more heavily engaged, but it is important to do. Small business is inevitably personal, but you can ill afford to become emotionally engaged in multiple small businesses. This can present an opportunity, however, once in the door to expand a relationship and realize those "unenvisioned opportunities."

A common mindset coming from Corporate America is that you are either a full-time employee or unemployed. Engaging with small businesses in a consulting relationship can present an opportunity to test the waters before "jumping ship" or to create some income once in the water before engaging in a specific entrepreneurial venture full time. (Somehow that became a very wet analogy, but I'll stick with it.) The small business space creates a wide breadth of opportunities for those willing to look for them. As you have conversations in this space, I guarantee that you will begin to find them if you are aware of them.

A final comment. Realizing this opportunity is in your hands. Small business owners are rarely actively looking for this type of support. If you can point it out to them, assess the potential, and identify specific ways in which you can help, you can typically find a path. Be creative in finding ways to make it work, since small businesses are rarely rolling in excess cash for several hundred dollars an hour in consulting fees. In the end, it creates new opportunities for you and the small business.

Control of Your Investment

2008-10-20T13:04:00.004-04:00

Much has been made in recent months of Wall Street versus Main Street in the fallout from the financial system's woes. Since that team, a lot of oxygen has been consumed and wasted with opinions on how to fix the system and kvetching about the impact of the fall on personal investments. However, I have found that active entrepreneurs are impacted very differently by the financial _______ (NOUN -- depending on your alarm level).

Recent years have supported a widely-held conception that home prices are supposed to appreciate by 10 to 20 percent per year and stock prices always go up. The common theme in these "investment strategies" is that they are outside of your control. Those in small business are more accustomed to investments which they can control (at least moreso than the stock market).

This lies at the heart of the relatively muted--or at least more focused--response of entrepreneurs to the financial crisis (I'll use the common word here for convenience, but you can still insert your Mad Lib entry from above). In discussions with those in small business, the focus on the financial fallout is on how it will impact their business and that of their customers. They are also acutely aware of the impact on the inordinately more important, but less discussed credit markets. The second and third order effects of the fallout on banks can have enormous impacts on small business, especially as banks have centralized into a much more analytically-driven, centralized operation instead of personal and local.

In the end, entrepreneurs can exert control over their investments through a variety of levers that depend on their business--stealing market share, cutting staff, across-the-board belt-tightening, creative financing with suppliers and customers, etc.

The question for the would-be entrpreneur is do you consider that more or less comforting? One huge trade-off is that the small business investment is typically focused on one business--essentially the anti-mutual fund. In the end, that ability to control can often carry the day and mean the difference for surviving the lean times in order to succeed in the long run. These times present another lens for the "know thyself" process that can set you up for a successful small business venture.

Being an Entrepreneur with Friends

2008-10-10T14:56:00.003-04:00

Every month I look forward to Norm Brodsky's articles in Inc. magazine. His NYC candor and first-hand experience make for a powerful combination. Whether his decisions have been smart or dumb, he will point it out to you. I found this month's article to be particularly strong.

In it, Brodsky provides his "10 most important lessons learned" over his career as an entrpreneur. One of them warns "you have no friends in business, only associates." Of all the points on his list, I find this to be the one tested the most and with widely varying results. Regardless of the outcome, I believe most people would tell you that when they have tested this rule that the outcome was different than they expected. And the average seems to favor a "for the worse" outcome.

Brodsky admits to his own conflicts around this one. We want so badly for it to be different, but the reality is that the business relationship is different from, but intertwined with the friendship. Some choose to ignore the connection or the impacts, but they do so at their personal and professional peril.

Without providing you a psychoanalysis of entrepreneurs and partnerships, I will simply suggest to you that you strongly consider AND DISCUSS the path forward if considering a business partnershsip with friends. Two classmates of mine from Darden actually had a case written about their experience leading up to considering a partnership. Theirs has progressed well to date (with Atlantic Caseworks), but due in no small part to their front-end efforts to assess fit and create a framework for their relationship.

A failure to consider this and to get it on the table will lead down a poor path. Never before has it been more true to say that "when you assume, you make an ASS out of U and ME." Friendships can survive on assumptions and random breakdowns in communications. Businesses can be crushed by them. This becomes acute when personal finances become involved. And in small business, the business finances are your personal finances. And in a partnership, you share that.

To many, starting business with friends seems like the most natural thing in the world. It does have its pros, but I urge you to consider the cons and their depth and breadth.

Control Your Career Path

2008-10-07T13:59:00.003-04:00

The current market gyrations and the resulting uncertainty in the halls of Corporate America remind me again of the magnitude of the shift in corporate job security. Long, long gone are the days of lifetime employment, but when you stand up in your cubicle and look around, it is amazing the extent to which so many within corporations act as though that continues to be the reality. If you are one of those, wake yourself up before your company does it for you.

I'm not trying to be gloom-and-doom here, but millions of people will spend the coming (or maybe even past) weeks and months worried about their futures with their current employer. The uncertainty will paralyze some as they await their fate. A victim mentality can take hold if you allow it. Now is the time for you to manage your own career.

In keeping with the theme of this blog, I will also remind you that the difference between small business and corporate job security is not quite what it is made out to be. Small business opportunities are typically more constant than corporate hiring, which can swing wildly between over-hiring and over-firing.

Spend some focused time on your network and your story to unearth small business opportunities. Market uncertainty also opens the spectrum of job opportunities to discuss, including consulting engagements which can be financially beneficial to both parties if set up properly. Be open-minded in your approach with small businesses. You are rarely replying to a job posting in this space. The options abound for those open to the discussions -- sweat equity into a business, management help needed, support to expand into new businesses, consulting, etc.

David Martin, a friend of mine that runs Spanda Group, wrote an article titled "Action Begets Action." That is never more true than in owning your own career progression. Avoid the victim mentality and become a doer. And as that old cat on tree branch says, "Hang in there."

Local Entrepreneur Support Resources

2008-09-25T17:22:00.003-04:00

I am in Sacramento this week at the US Hispanic Chamber of Commerce's annual convention. A speaker at this morning's breakfast shared his experience on identifying and enabling budding entrepreneurs. He said that he works with groups in Washington, DC that identify high-potential entrepreneurs and then help assemble teams and funding around them. If I can find the names to these groups, I will post them in the comments below. I don't have them now, but his comments made me think about an avenue that I have overlooked in my previous posts.

Local chambers of commerce and other civic groups can be fabulous conduits for small business support. Granted there are a range of these organizations from lukewarm to very good, but these groups are in the business of helping their communities and they recognize the importance of small business to the local economy. And the leaders of these organizations are born networkers. Their network covers financing, corporations, small business owners, and more. It is a worthwhile use of your time to get to know the personnel within these organizations that can help you and/or point you in the right direction.

News of groups that actively identify and support entrepreneurs for the good of the local community are promising. This suggests an awareness that the "safety" of Corporate America can suppress the value to be created by certain individuals. For some, it may be the breakthrough idea for a new business. For others, it may be the leadership abilities to lead a small, growing organization. Regardless, the value of a group within a community that can identify these individuals and bring the teams together has some real potential.

So, one takeaway was that there are local groups that are on the lookout for people wanting to enable small business. The same fundamentals from prior posts apply to determine what you can bring to that team, but an established network to enable that can be a real game-changer for individuals and the economy.

Wall Street to Small Business

2008-09-18T16:20:00.003-04:00

This week's news has reminded me of one area of Corporate America in particular that doesn't necessarily get a lot of sympathy or consideration when it comes to small business or entreprenuership--Wall Street. Not known as a bastion of entrepreneurship, there are doubtless some inhabitants considering the transition to small business for any number of reasons. Certainly, this week may have presented some with a new list of additional reasons to look for options beyond their current employment.

The same principles outlined in other posts still apply, however. For many coming from the world of finance, they already possess a skill set that has value and is often lacking in small business. With an appropriate mindset, they can be extraordinarily successful in the small business space. I offer a few points to consider while trying to avoid the stereotypes (because they're just toooo easy!).

Adjust your income expectations. Small businesses aren't in the businesses of big salaries or big bonuses.
Learn how to make coffee, copies, and travel reservations.
Look for teams that offset your weaknesses. If you are good at finance but a newcomer to operations and sales, make sure that you "hire/partner for your weakness."
Expand your network. Ensure that you have "nodes" in your network that can get you into this realm that is often very far from Wall Street and downtown high rises.
Be honest with yourself. A confidant is often essential here to give you feedback on potential blind spots.
Communicate with your family. This transition will not go well, if you do all this in your head and don't communicate at home.

Hopefully these posts and others on the right can help bring some structure to people thrust into a journey that had maybe been in the back of their mind. My own paradigm is within a more corporate setting than that of a bank, but there is a path into small business from there. You just have to get onto the path.

Powerpoint Skills in Small Business

2008-09-16T15:34:00.003-04:00

My last post was on focusing your skill development in Corporate America on areas that will be of most use in the entrepreneurial space. Today, I will underscore the importance of Powerpoint skills in small business. That's right, Powerpoint. The sexiest of corporate skills!

The ability to create impactful, concise presentations is a skill that is important in many facets of small business, but is often sorely missing. For those of you that are Powerpoint psycho's, find the right balance since spending a week creating a 15-slide presentation will not serve you well as an entrepreneur. For those of you that don't know how to add a graph to a slide, learn the basic skills while you can.

Big companies use Powerpoint to varying degrees. In the most optimistic scenario, it is an effective communication tool for presenting data and making decisions. In a pessimistic scenario, it's an abusive tool for bludgeoning listeners into acquiescence. Whatever situation you are in, find ways to acquire good presentation habits. It is a minimal investment for a skill that will differentiate you immeasurably as an entrepreneur.

As an entrepreneur, you are presented with continuous opportunities to present yourself and your venture to potential partners. In the event that this accompanies a presentation, this is a unique opportunity to put forth a professional image that captures you and your company. The reason for this post today is that too many entrepreneurs fumble away (like Michigan!) this opportunity with shoddy presentations.

Here are a few suggestions:

Start with a story-board to outline your message
Be brief
Pay attention to simple formatting
Have someone proof-read the big picture story and the details
Skip the clip-art ... seriously

As a corporate employee, if you let your assistant create slides for you, stop it. You most likely will not have that type of support in small business. (And if you do, it may be a sign that your company is too cavalier with its capital.)

Finally, I will sign off by encouraging you to avoid my biggest Powerpoint pet peeve. It's the slide that pops up and is immediately followed by: "I know you can't see/read this, but ...." To paraphrase Jerry Maguire, "You lost me at 'but.'"

An Entrepreneurial Take on Your Annual Review

2008-09-11T15:28:00.005-04:00

If you are employed within Corporate America, you are either approaching or are maybe in review time. Without commenting on the merits or drawbacks of the actual process itself, I would suggest that you take the opportunity to view your feedback through an entrepreneurial lens. If you view both the feedback, the conversation with your manager, and the action steps that come from it, the process can move you towards your small business goals within the confines of your current company.

Most processes will ask you to evaluate your peers and yourself for a set of traits. If you take a step back and view these traits through your new secret-decoder entreprenuer lens, you will notice that some of these traits will be useful in small business and some ... not so much (in the words of Paul Reiser). Your alignment of those traits along that spectrum does not always match those most highly rewarded by the corporation. For example, the ability to make killer decks (PowerPoint presentations, for those of you fortunate not to know) might be the communication trait rewarded. Not the most important of strengths to have in small business, however. (It just occurred to me that this could be the topic of a whole other post in the future!)

Many companies will also fall into the trap of getting you to focus your development on areas in which you are weakest. Newer schools of thought encourage companies to focus on making strengths even stronger and insuring that teammates complement one another rather than trying to make a bunch of mediocre jacks-of-all-trades. Regardless, your challenge is to focus your development opportunities on areas that will also enable your success in small business. Presumably, you can do this without submarining your corporate job. It is often a matter of stating your desire to find a role or opportunities that will develop those areas. Hopefully, you have a manager and/or a corporate environment that will support you in that. If you set aside cynicism, you are often pleasantly surprised. For one, you will stand out in relation to those who are more reactive than proactive in their response to the annual review process.

So, maximize the personal, long-term value you get from the review process by seeing how your peers feel you do on the metrics that matter to you. Discuss the results and gather the feedback with an emphasis on those from your manager and peers. Take away from that a focus on opportunities to develop and improve those skills that you deem most important. You don't have to be out of Corporate America to begin taking steps in the small business direction.

Keeping the Entrepreneurial Faith

2008-09-08T23:30:00.001-04:00

I must begin by once again pointing out that entrepreneur is a needlessly difficult word to spell. I just might have to create my own word. If I do, I'll be sure and trademark it (see Pat Riley's "three-peat").

This is another one of those partly therapeutic posts that I believe all small business people can use from time to time. Keeping the faith in the small business space is not always easy. The realities of small business can be aggravating when viewed through the corporate or mainstream lens of so many friends and family. Things like regular paychecks, packaged benefits, regular hours, and others seem to be the God-given rights. There will always be those times when the questions will pop into your head. Why am I putting myself and my family through this?

Rather than platitudes about "it being darkest right before the dawn" or the like, it boils down to the fact that it is just plain hard at times. The world around you is structured for those with a steady life. The world wants to see the income statement more than the balance sheet. The problems presented in small business are quite often personal and hard to get out of the forefront of your mind. The challenge is to achieve a peace with the path you have chosen and a faith that your perseverance will pay dividends--financially and beyond.

It is important that all entrepreneurs have a deep-seated confidence in what they are doing. It permeates all of your actions and cannot be faked effectively. Beyond yourself, however, it is important to leverage your friends and family for support. Find a network that can appreciate your challenges and mentor you when necessary towards solutions. Wallowing is not the support team you need.

Create a personal system to support yourself during the natural ebbs and flows that come with a business that is truly a part of you. Choose who you listen to at the times you feel down, since many will encourage you to "get a real job." I have had the benefit of a start-up with several partners where the team was able to pick up the one or two members that might be down at a given time. Be honest about your concerns and challenges, and you will find that the process of addressing them will boost your confidence to keep on keeping on.