Startup Professionals Musings

7 Reasons Why Fun at Work Makes Winning Startups

2013-05-25T06:30:00.000-07:00

I’m convinced that people who have fun at work are more innovative, as well as happier. I don’t have any big scientific studies to prove this, but in my considerable business experience, I haven’t seen many successes come out of a group of fearful pessimists or unhappy people.

As I was looking through the literature, I did find evidence that many strong business leaders, like John D. Rockefeller, knew how to laugh at themselves. Humble leaders with this trait seem to create cultures that don't take themselves too seriously; cultures willing to take risks; cultures capable of creating and supporting a greater number of ideas.

Current popular startups, like Foursquare, with their break-up music and "Slow Jam Fridays" are a model of this new fun world. I can postulate several reasons why laughing and having fun at work might be linked with creativity and innovation. Here are a few:

Escape the inhibitions. Laughing tends to remove inhibitions. Under the spell of inhibition, people feel limited and stuck. This is what we refer to when we say “thinking outside the box”. Encourage everyone to be open to new ideas and solutions without setting limiting beliefs. Innovation is more about psychology than intellect.
Willing to make mistakes. People who take themselves too seriously are afraid to be seen failing. Failure while having fun is not usually seen as life-threatening. Expect that some ideas will fail in the process of learning. Rather than treating the mistakes as failures, think of them as fun experiments.
Reset to a positive attitude. Under the pressure of a difficult problem, or if you are stuck on something, nothing innovative is likely to emerge. Do something fun to shift your thoughts back to the positive. Come back to the work problem with a fresh and more creative mind.
Productive group activity. In teams, people feed off each other. A “downer” in a group takes the whole group down, whereas a fun person can bring the whole group to a more productive and innovative plane. This allows the group to “suspend disbelief” and really brainstorm new alternatives.
Likely to be seen. Successful people surround themselves with people they enjoy and respect. If you are unhappy, or take yourself too seriously, you are less likely to get the attention and trust of people who can make a difference, or even recognize your innovative ideas.
Likely to be heard. Communication effectiveness is the final hurdle for creativity and innovation. No matter how great your idea is, it won’t happen if it is not heard. People like to listen to fun people, and they close their mind to all the rest. If you want to be heard, write down the message and deliver it in a positive tone.
Be perceived as a leader. By definition, people who project negativity are not going to be perceived as leaders. Nobody will charge a hill led by someone who says it can’t be done, or someone who emphasizes the risk of death.

Some people seem to want to make fun an enemy of business. I believe you will accept that premise only at your own peril. Fun is all about creativity, innovation, play, experimentation, progress, and seeing real things come to life. The most innovative people don’t see any dichotomy between work and fun.

So I encourage you to go out of your way this season to nurture fun at work, as well as passion and motivation. Learn to pay attention to laughter. Where there is laughter, there is an idea that holds people's interest. If you don’t take yourself too seriously, the pleasant by-product is that work becomes more enjoyable, and your innovative side will be more visible.

Marty Zwilling

A Business Rebound is Not All Positive for Startups

2013-05-24T06:30:00.000-07:00

As the business economy rebounds, many entrepreneurs are thinking that life will soon get easier, and their opportunity can only grow. In reality, the business world gets tougher every day, with new entrants, new technology, and competitors more easily entering the fray from around the globe.

Way back in 1979, Michael E. Porter proposed his Five Forces framework for analyzing the competitive environment which I think makes even more sense today. Every existing business, as well as every startup, needs to reassess their product or service in the context of these five forces:

Intensity of competitive rivalry. This is where most current business plan analyses focus today. These plans just list a few key competitors out there now, compare feature richness, quality considerations, and pricing. This is an important first step, but it’s only the beginning.
Threat of new competitors entry. Startups that target profitable and growing markets with high returns should realize that these will draw many new entrants. It will certainly also decrease profitability over time, as well as test your sustainable competitive advantage. That leads to switching costs, sunk costs, brand equity, and a host of other considerations, commonly called “barriers to entry.”
Utility of alternative solutions. You are never the only alternative, hopefully just the best, in price, utility, and satisfaction. If you new vehicle costs too much, people take the bus. At some level of function, availability, and price performance, customers jump ship away from you. These elements are referred to as “barriers to exit.”
Bargaining power of customers. This is the degree to which customers can put your company under pressure, or leverage prices, delivery, features, and quality (market of outputs). A key is your differential advantage from alternatives. Small differentials and more competitors give customers higher leverage.
Bargaining power of suppliers. Suppliers of raw materials, components, labor, and services to you can be a source of power over your ability to compete (market of inputs). You need to identify substitute inputs, supplier concentrations, and employee solidarity (labor unions), which can limit you or give you the advantage.

A few years ago, Andrew Grove is credited with postulating a sixth force in the marketplace – government, pressure groups, and the public. This force adds the concept of “complementors,” and has led to the growth of partners and strategic alliances to balance the competitive environment.

These forces make up the micro environment of a company, which affect its ability to serve its customers and make a profit. A change in any of them should be your cue to re-assess the marketplace. All startups need to remember their core competences, business model, or network, which are the factors that allow them to maintain a competitive advantage.

One of the key sections of every entrepreneur’s business plan is the analysis of the competition. I especially love the ones that start and end by saying “We don’t have any competitors.” Investors take that to mean either 1) there is no market for your product, or 2) you don’t understand the concept of business and competition. Either way you lose.

I always remind startups that this section of the business plan should not be a negative one, merely listing competitors, with their advantages and head start. It’s your opportunity to highlight and emphasize your relative advantages, whether they be price, features, bargaining power, or any of the six forces outlined above.

On the other hand, there is more at stake for startups than enterprises because startups do not have the same financial capital of their bigger rivals. But with a clear understanding of where the power lies, you can take advantage of a position of strength, improve a situation of weakness, and avoid stepping into a pack of wolves with no protection. It’s a painful end.

Marty Zwilling

A Great Product Will Fail Unless You Price it Right

2013-05-23T06:30:00.000-07:00

One of the toughest decisions for a startup is how to price their product or service. The alternatives range from giving it away for free, to pricing based on costs, to charging what the market will bear (premium pricing). The implications of the decision you make are huge, defining your brand image, your funding requirements, and your long-term business viability.

The revenue model you select is basically the implementation of your business strategy, and the key to attaining your financial objectives. Obviously, it must be grounded by the characteristics of the market and customers you choose to serve, the pricing model of existing competitors, and a strategy you believe is consistent with your future products and direction.

So what are some of the most common revenue models being used by startups today? Here is a summary, with some of the pros and cons or special considerations for each:

Product or service is free, revenue from ads. This is the most common model touted by Internet startups today, the so-called Facebook model, where the service is free, and the revenue comes from click-through advertising. It’s great for customers, but not for startups, unless you have deep pockets.
“Freemium” model. In this variation on the free model, used by LinkedIn and many other Internet offerings, the basic services are free, but premium services are available for an additional fee. This also requires a huge investment to get to critical mass, and real work to differentiate and sell premium services to “convert” users to paying customers.
Cost-based model. In this more traditional product pricing model, the price is set at two to five times the product cost. If your product is a commodity, the margin may be as thin as ten percent. Use it when your new technology gives you a tremendous cost improvement. Skip it where there are many competitors.
Value model. If you can quantify a large value or cost savings to the customer, charge a price commensurate with the value delivered. This doesn’t work well with “nice to have” offerings, like social networks, but does work for new drugs and medical devices that solve critical health problems.
Subscription model. This is a very popular model today for Internet services, calling for monthly or yearly low payments, in lieu of one value or cost-based price. Startup advantages include a more stable revenue stream, easier customer retention, and increasing customer investment over time. The customer advantage is a lower entry cost.
Product is free, but you pay for services. In this model, the product is given away for free and the customers are charged for installation, customization, training or other services. This is a good model for getting your foot in the door, but be aware that this is basically a services business with the product as a marketing cost.
Product line pricing. This model is relevant only if you have multiple products and services, each with a different cost and utility. Here your objective is to make money with the portfolio, with high markup and low markup items, depending on competition, lock-in, value delivered, and loyal customers. This one takes expert management to work.
Tiered or volume pricing. In certain product environments, where a given enterprise product may have one user or hundreds of thousands, a common approach is to price by user group ranges, or volume usage ranges. Keep the number of tiers small for manageability. This approach doesn’t typically apply to consumer products and services.
Feature pricing. This approach works if your product can be sold “bare-bones” for a low price, and price increments added for additional features. It can be a very competitive approach, but the product must be designed and built to provide good utility at many levels. This is a very costly development, testing, documentation, and support challenge.
Razor blade model. In this model, like cheap printers with expensive ink cartridges, the base unit is often sold below cost, with the anticipation of ongoing revenue from expensive supplies. This is another model that requires deep pockets to start, so is normally not an option for startups.

If you have real guts, you can try the Twitter model of no revenue, counting on the critical mass value from millions of customers to sustain your company. This model was popular back in the heyday of dot.coms, when investors were buying anything with a following, but is frowned on today. It definitely requires founders with deep pockets and investors willing to take a huge leap of faith.

In all cases, your business model interacts closely with your marketing model, but don’t get them confused. Marketing is initially required to get visibility and access to the opportunity, but pricing defines how you will actually make money over the long term. A key challenge for every entrepreneur seeking funding is to convince potential investors that the marketing model will substantiate your positive revenue model, customers will buy the offering, and you have a viable business model.

Overall, I’m a huge fan of the “keep it simple (KISS)” principle – customers are typically wary of complex or artificial pricing. Your challenge is to set the right price to match value perceived by the customer, with a fair return for you. It’s not a game show, so don’t guess - do your research early with real customers. Your startup’s life depends on it.

Marty Zwilling

How You Too Can Be an Unstoppable Entrepreneur

2013-05-22T06:30:00.000-07:00

We all know at least one entrepreneur who always gets things done, and appears unstoppable in his quest. All of you probably know many others who talk incessantly about their great ideas, but never seem to even get started, or they give up at the first obstacle. What are the attributes that make an entrepreneur unstoppable, and is it possible for people to learn to be unstoppable?

According to my own observations, and a new book by Bill Schley, “The UnStoppables: Tapping Your Entrepreneurial Power,” there are some key “emotional mechanics” that put entrepreneurs in motion, and some principles that help entrepreneurs succeed in startups, as well as big companies. I believe we all have the power within us to learn and adapt to these principles.

Every entrepreneur needs to accelerate his proficiency by adopting and using this proven set of skills, rules, and emotional power principles, like the Graham Weston experiences at Rackspace summarized in the book. Here is an outline of the key essentials:

The law of motion versus contemplation. Everyone dreams and talks. Successful entrepreneurs do. This means yearning and starting, not quitting, and ultimately achieving some value that wasn’t there before. In a startup, the founding team and their key employees have to all be entrepreneurs, with an impassioned leader.
Limit focus to the top three or four priorities. It turns out that focusing on three or four activities at a given point, like positioning your brand, prospecting for leads, or managing cash flow, are all that you need to survive. It’s also all that any entrepreneur can manage concurrently with proficiently. Adhere to the familiar 80-20 rule.
Rely on mental “rules of thumb” or heuristics. Being unstoppable must include the power to think and innovate on your feet under real conditions in real time. That means developing an intuition or “gut feeling” based on preset “rules of thumb,” continually updated from peers, advisors, positive experiences, and prior failures.
Simple beats complicated. If your unique difference can’t be explained on the back of a business card, you don’t have one yet. There is virtually no idea, no process, and no vision that simplicity and brevity can’t improve – and never let a consultant, attorney, or investor try to tell you otherwise.
Find the center of an issue and go there. Unstoppable entrepreneurs wake up every day on a quest to keep the center of their brand, their performance, their culture, or their status as #1 choice locked in the crosshairs. They win by going all in where it counts, and nothing counts more than the center.
Conquer the fear that is preventing action. When a person has something important to do, and they are not doing it, then some type of fear is stopping them. The biggest counter to fear is love – as in passion for the idea, love for teammates, and desire to change the world.
Embrace risk. We can’t achieve any human progress without risk. In this new dynamic world, where change is accelerating all around us, the safety we feel by hiding behind a rock instead of putting ourselves in motion has become an illusion - the riskiest decision of all. It’s always less risky to do it, than to have it done to you.
The unsurpassed power of belief. Henry Ford said simply, “If you think you can or think you can’t, you’re right.” Thinking “it’s possible” triggers confidence, determination, and energy. Thinking the opposite makes any task impossible. Belief is the outcome of mastering all the other emotional mechanics

Notice that none of these mention anything about how much money you need to start, extraordinary intelligence, or academic credentials. Accelerated proficiency is all about the art and science of getting entrepreneurs to be Minimally Functionally Qualified (MFQ) in a sharply accelerated time frame so they can get in motion, start doing, and effectively teach themselves, rather than talking and observing.

To be unstoppable, every entrepreneur has to decide to dream, to dare, and to do. Decide to stand with your fear, and turn the struggle into your best advantage. Decide to learn the essence, then get in motion. Where are you along this spectrum as an entrepreneur?

Marty Zwilling

Recent Gen-Y Startup Successes are an Emerging Era

2013-05-21T06:30:00.000-07:00

The business world has been watching this emerging generation with trepidation, and a lot of people haven’t been sure who would be the winners, and who would be the losers. Can Gen-Y, much less the new Generation Z (1995-2010), survive as entrepreneurs, and do they have the passion and commitment it takes to run a startup and attract investors?

My own perspective is that the recession was good for Gen-Y (Millennials), because it forced them to face reality, often for the first time in their life. In the last few years, even college grads with advanced degrees don’t have job opportunities waiting for them. But I’m happy to report that I see more and more of them impressively stepping up to the entrepreneurial plate.

It now reminds me of previous generations, per the qualms raised about Gen-X back about 20 years ago, and about the Baby Boomers some 20 years before that. Yet now Gen-X’ers are seen as the major facilitators of change, and Boomers are the angels and business advisors for hot new startups.

We should look ahead to capitalize on evidence of the positive attributes of Gen-Y from a business perspective, including the following:

Confidence. Raised by parents believing in the importance of self-esteem, they characteristically consider themselves ready to overcome challenges and leap tall buildings.

Goal and achievement oriented. Many Gen-Y’ers approach the business world with solid personal goals. They expect to create something that is technically challenging, creative, fun, and financially rewarding.

Multi-cultural. They expect to succeed in a workplace that is fair to all, where diversity is the norm—and they’ll use their collective power if they feel someone is treated unfairly. Diversity is a key to innovation, and big new business opportunities.

Socially conscious. They were taught to think in terms of the greater good. They have a high rate of volunteerism. They expect companies to contribute to their communities—and to operate in ways that create a sustainable environment.

These attributes have already driven several well-known Gen-Y startups, like Facebook, Zappos, and Groupon. Yet it’s too early to totally forget the potential shortcomings and idiosyncrasies of Gen-Y. According to Winograd and Hais, there are still some of worrisome attributes relative to the role of entrepreneur:

Need to be scheduled. Gen-Y’ers were tightly scheduled as children and used to a full schedule of structured activity. Many still struggle with handling free time and time management in general. A startup is the most unstructured entity I know.

Minimal “street smarts.” They grew up in a time of increasing safety and protection (car baby seats, no failing grades, no walking to school). They were rarely left unsupervised. They may have good academic credentials, but less business sense.

Consensus driven. Gen-Y members have been reared in a way that makes it difficult for them to conduct business negotiations in an entrepreneurial manner. Rather than seeking to come out on top in zero-sum games, Gen-Y strives for consensus.

My challenge to Gen-Y, and to the rest of us, is to capitalize on the positive attributes and continue to work on overcoming any remaining negatives. I’m still convinced that “real change only happens when the pain level gets high enough.” The past pain level has been high, but the business climate has improved, so let’s not slip backward.

Gen-Y is now experiencing their wake-up call, just like previous generations did with Vietnam and the 1980 recession. From the quality of interactions I’ve had recently mentoring a number of Gen-Y members, I’m happy to report that many are emerging as the new entrepreneurs of the digital age. I’m sure you agree that we need them to fuel the wave.

Marty Zwilling

6 Strategies for Transforming Ideas Into Results

2013-05-20T06:30:00.000-07:00

Successful startups are all about turning ideas into action quickly and efficiently. These actions must be the hard part, since entrepreneurs always seem to come to me with ideas, and ask me for help on the actions. That has always seemed strange to me, since the magic is supposed to be in the ideas, and the actions are the same for every business.

In fact, the actions required to start and run a business are well documented, the subject of many books, and taught in college courses across the land. As confirmed to me by John Spence in his book on this subject, Awesomely Simple, turning business ideas into action consists of six essential strategies:

Build a vivid vision. Having a clear, vivid, and compelling vision in your head is without question an essential component in building a successful company. But that’s not good enough. The vision has to be documented and communicated in a way that makes it vivid to every member of your team, your customers, and your investors.
Team with the best people. The best people are highly talented and motivated individuals who are also masters of collaboration. The future of your startup is directly tied to the quality of talent you can attract and keep. You must create a winning culture that people love.
Practice robust communication. Open, honest, frank, and courageous communication, both inside and outside the organization, is critical. The key skills can be learned, and include deep listening, logic versus emotion, and reading body language. According to Spence, this is the biggest problem he has to deal with in client organizations worldwide.
Cultivate a sense of urgency. Get things done. A fast, agile, adaptable organization makes the important things happen now. Urgency is allergic to bureaucracy. Reward fast action. You set the model for your startup. You become what you focus on and become like the people you spend time with.
Enforce disciplined execution. Build a performance-oriented culture that demands quality in every operation, encourages continuous innovation, and refuses to tolerate mediocrity. Most organizations execute only 10 to 15 percent of their major goals. Do a periodic effectiveness audit to check your operation. Then fix it.
Show extreme customer focus. Put feedback mechanisms in place to know that you are consistently delivering what customers truly value. Attitude and listening are the keys. Superior customer focus can drive as much as an 85 to 104 percent increase in your profitability.

It should be pretty easy to see the interdependence and synergy among the six principles, each building on the next, all the various elements working together to create a highly successful business. But you don’t have to go out and address all six principles right now. Pick one that will create leverage immediately, and begin with it.

Spence defines three simple watchwords that will lead to business excellence – focus, discipline, and action. If you are missing any of these, the outcome will most certainly be mediocre. Once you start accepting mediocrity, you become a magnet for mediocrity.

Your great ideas deserve more than mediocre actions. Simple actions done in an outstanding fashion are far more effective than complex and time consuming actions done poorly (thrashing). Also, don’t be fooled into thinking that “simple” means “easy to implement”. Start now to turn your innovative ideas into action. Every entrepreneur loves a challenge.

Marty Zwilling

How an Entrepreneur Can be Open But Stay In Control

2013-05-19T06:30:00.000-07:00

The emergence of social networking and the Internet has caused a new focus and value on “openness,” which leads to a new element of leadership, called “Open Leadership.” The mantra of open leadership is “Be Open, Be Transparent, and Be Authentic.” This is counter to the traditional business premise of “control,” so many companies are still pushing back.

Charlene Li, in her book “Open Leadership,” shows leaders how to tap into the power of the social technology revolution and use social media to be “open” while still maintaining control. I support her ten elements of the basic framework and vocabulary of open information sharing and open decision making:

Explaining: creating buy-in. This element is sharing information through the new video, audio, and interactive media about, and the logic behind decisions, direction, or strategy with the goal of gaining buy-in to the idea so everyone is working toward the same goal.
Updating: capturing knowledge and actions. New publishing tools, like blogs, collaboration platforms, and even Twitter provide updates that are easily available. These have the added benefit of being searchable and discoverable.
Conversing: engaging in a dialogue with others. Employees can share best practices with customers on social network platforms and customers can help each other. When done well, an organization’s online community can become a competitive advantage.
Open microphone: encouraging participation. Everyone and anyone is welcome to contribute through new collaborative tools with no preconditions. Search, combined with ratings and reviews become key in separating the useful from the rambling.
Crowdsourcing: solving a specific problem together. The goal here is to grow the sources of new ideas and gather fresh thinking to create a new product or service. It can also be for solving everyday problems, like logo design or open source code.
Platforms: setting standards and sharing data. Ebay is an example of open standardizing on how items are listed and how transactions are handled, enabling millions of individual sellers. Common platforms enable open data access at any level.
Centralized. The key challenge of making centralized decision making more open is to open up information sharing in both directions, so that those in power have the right information and also have the commitment to share it back out to the organization.
Democratic. Increasingly, voting is used to allow people to choose from a set of equally viable options, with the result is that employees feel a greater sense of ownership in the process. This is also becoming prevalent in decisions with customers on products.
Consensus. Social technology tools now allow this process to be done quickly and less chaotically, with tremendous buy-in from everyone affected. This process works well in today’s extremely flat and non-hierarchical startup organizations.
Distributed. This is a hybrid of all the preceding decision processes, in that it pushes decisions away from the center to where information and knowledge actually reside, typically closer to the customer. This mode requires more discipline and planning.

I’m still waiting to see how all this works out in real life. The challenge is to be open without abdicating all control, or spiraling into chaos. Hopefully, by embracing social media rather than banning it, leaders can transform their organizations to become more effective, decisive, and ultimately more profitable in this new era of openness in the marketplace. What do you think?

Marty Zwilling

Inspiration Without Perspiration is a Dull Startup

2013-05-18T06:30:00.000-07:00

I’m fully convinced that both inspiration and perspiration are always required in a startup. Yet many people seem to be stuck on one end or other of this equation – all perspiration with no dream, or all inspiration with no reality. Success is the right balance of both for fun and profit.

Aspiring entrepreneurs ask me why their great idea hasn’t sold; they talk about it endlessly, and they expect others to do the development, finance, and marketing work for them. Those at the other extreme don’t look up from the grindstone long enough to notice whether all their work is producing sweat equity or just sweat.

Starting a business may be fun, but it’s not easy. No matter how many times you’ve done it – the stresses are tremendous. It can also be very inspiring, as you watch your dream morph into reality, or as you feel each little element of success:

Watch your team develop new skills. There is nothing more inspiring than seeing the results of your mentoring and leadership. Your own learning should be the biggest inspiration of all.

Your solution fills a real market need. Truly satisfied customers are a joy to every business person. Watching the orders come in, or the product moving off the shelf, is the feedback you have been looking for.

A business model that works. You have figured out how to undercut your competitor’s price, and still hold your margin. Taking that first salary after a long dry spell is an inspiring moment, and a great celebration with friends.

Love that sustainable competitive advantage. Working on that unique design, or completing the breakthrough for an innovative patent, are moments of inspiration that you will never forget, especially if they become your competitive edge.

Bask in the success as it happens. Maybe it’s that first customer testimonial, or that first congratulations from someone you respect, or seeing your story in the newspaper. You knew all along that you could do it.

Of course, never forget those ongoing perspiration items that seem to haunt you every day:

Create intellectual property. Incorporate, register your domain name, trademarks, and copyrights, then patent if possible. Reserve the same names on the leading social networks and blogs.

Marketing is top priority. Start even before the product is ready. Word of mouth advertising and viral marketing cost big bucks these days so budget for it. It takes leverage, effort and money to get in the public eye and stay there.

Reign-in expenses. Review every expense with a miserly hand. Do not delegate this task! Make every effort to do things “in house”, rather than rely on outside services, accountants, and law firms.

Though innumerable factors are a part of every success, it’s arguable that the ratio of effort to inspiration can make the difference between just spinning wheels, on the one hand, and ideas that never come to fruition, on the other.

Some say the Internet is a metaphor for our brains. Both are networks. Maybe inspiration is feeding your brain as much information as possible and then figuring out how it connects when the time comes. Perspiration is the lubrication to keep your senses open to all the possibilities.

Marty Zwilling

10 Entrepreneur Risks Worth Taking in Every Startup

2013-05-17T06:30:00.000-07:00

Being a risk taker in business is not the same as being reckless. Nevertheless, the word “risk” has a negative connotation to most of us, implying danger and possible loss. For true entrepreneurs, risk is viewed as a positive, with its implied challenge to overcome the unknown and hitting the big return.

In fact, risk is an integral part of life, as well as every business, yet so few people learn to manage it properly, or even want to think about it. One way to learn is to understand better how successful entrepreneurs approach risk, and look at actual strategies they use for success.

I found a great summary of key strategies used, with life stories, in “The Risk Takers,” by Renee and Don Martin. Here is their list, with a little prioritizing and comments of my own:

Spot a new trend and pounce. Often, a shift in cultural or economic trends will create new entrepreneurial opportunities. The challenge is to recognize the shift early, and then act on it, despite the risk. This is the origin of the “first movers” competitive advantage.
Go on a treasure hunt and find an under-served niche. Even a huge multi-billion-dollar company can’t offer everything for everyone. There is nothing more exciting than finding a lucrative market that everyone else has failed to spot or target.
Exploit your competitor’s weakness and make it your strength. The sharpest entrepreneurs have a knack for viewing the world from the perspective of their customers. That quality can help you capitalize on competitors vulnerabilities and shortcomings.
Hit ‘em where they ain’t. Whenever possible, set your sights on areas that your competitors have neglected or ignored. It’s easier than dislodging well-recognized existing products, and waiting for customer change, even if your solution is better.
Buck the conventional wisdom. Many entrepreneurs profiled in the book succeeded in large part because they veered away from established formulas and ways of thinking. Challenging convention can open the door to competitive advantage.
Save your bucks and get notice without expensive advertising. If your startup business is on a tight budget, there are creative ways today to get customers’ attention without traditional advertising. Start with social media, blogging, and word-of-mouth.
Never let adversity or failure defeat you. The ranks of successful entrepreneurs are filled with men and women who refused to stop believing in themselves, despite the derision of others or heartbreaking failures. Persistence and resiliency lead to success.
Trust your gut. An expanding body of research confirms that intuition is a real form of knowledge. It’s a skill you can develop and strengthen – one that’s particularly valuable in the most chaotic and fluid business environment. At such times, intuition often beats rational analysis.
Never stop reinventing your company. Top-performing entrepreneurs make it a point to give their business a major overhaul now and then to keep pace with changes in the marketplace. Complacency in business is like a slow leak in a tire. By the time you notice it, the damage is done.
Just start! The “perfect” time for a business launch will never present itself. More often than not, waiting just gives would-be competitors the opportunity to beat you to the punch. If you truly believe your idea will succeed, then take the risk and just get started.

We have always been a world of entrepreneurs, and if we are to rebuild our economy, we must reinvigorate the culture and mind-set that have built that tradition. Believe in the power of your ideas and just start the pursuit of you own entrepreneurial dream. With intelligent risk, you too can succeed.

Marty Zwilling

For Entrepreneurs, Conversations Are All Business

2013-05-16T06:30:00.000-07:00

Whether you are trying to motivate your team, close a deal with a customer, or get funding from an investor, a casual conversation is usually a waste of your valuable time. These result is a founder who is always “too busy,” but never seems to get the business done and the team moving. All real business is conversations focused on creating results.

Shawn Kent Hayashi, in her new book “Conversations That Get Results and Inspire Collaboration” makes my point very well as she outlines the top twelve types of conversations that relate to working together in business, and provides tips on how to make each of them more effective for all concerned:

Conversation for connection. Connecting with others happens when we slow down our talking enough to be in the present and really listen to one another. Rapport building requires listening, more than talking. Powerful listening causes trust to grow.
Conversation for creating new possibilities. The questions a manager or colleague asks help us to understand a situation better, if we ask good questions and really listen to the answers. Conversations can also be the triggers to professional development.
Conversation for structure. When we know what we want to create, the next step is to devise a plan. We build our plans with the steps as we become aware of them through conversations, with ourselves as well as with others.
Conversation for commitment. For each identified action step, we identify potential candidates and then seek their commitment to produce the result that corresponds to the task. The commitments we make to ourselves are the most fundamental.
Conversation for action. What actions will make your tasks and goals come alive? We’ve all seen people get stuck in a project because they do not know what to do next. They’re not asking themselves or anyone else the right questions, and not listening.
Conversation for accountability. After a conversation for commitment has occurred and the expectations are clear, being accountable for engaging others in what you want to do is a sign of respect. Sometimes people need to be guided into better outcomes.
Conversation for conflict resolution. Many people will avoid conflict in work relationships at all costs, which is nonproductive. Others feel fear when the smell of conflict arises. A few overuse this conversation type. Conflict is normal, so deal with it.
Conversation for breakdown. Anger indicates that something or someone has crossed one of our boundaries, and is a signal to address the issue. Breakdown recognition is vital to moving forward. Asking for what we want might actually clear up the breakdown.
Conversation for withdrawal and disengagement. It is unrealistic to think that all work relationships will be enjoyable or friendly forever. Often it is best to end a tenuous connection, so that we can invest our time in ones that are meaningful and productive.
Conversation for change. Your ability to change the direction of an individual, team, or an investor occurs through conversations. By design, you can change the conversation in the office, at board meetings, and with peers who seem to have gone off track.
Conversation for appreciation. Think of the last time you felt really appreciated at work. Undoubtedly someone showed appreciation of your efforts using language that works for you. Affirming others through conversation builds relationships and momentum.
Conversation for moving on. You have conversations for moving on when leaving a community or transferring or retiring from a company. One day you might reconnect, but for now you have closure, with no expectations of future conversations.

Being successful as an entrepreneur begins in a conversation with ourselves first, and then extents to others, focused on what we are passionate about, and the solutions we are bringing to market. None of these are casual conversations, where you don’t really listen to the response. How committed are you when someone is obviously not listening to your responses?

Marty Zwilling

7 Rules for Savvy Customer Service Required Today

2013-05-15T06:30:00.000-07:00

Customer service has always been reactionary, meaning someone has to wake up and answer website email requests. That’s just not savvy enough to hold today’s fickle, less loyal, and ready to jump customer. Great startups are getting ahead of the game with “anticipatory customer service,” like providing smart phone access to product and account data to head off complaints. This exemplary customer service is just savvy marketing.

Self-service technologies, social media, and smart phones have created a new set of expectations for high-tech consumers today. You should assume that they will want discounts to match competitors, and answers to technical questions in real time, rather than waiting in some phone or mail queue.

Thus you need a new generation of self-service that goes way beyond the now old-fashioned and frustrating automated phone audio response messages. I found a good summary of these new expectations in a book recently published by Micah Solomon, “High-tech, High-touch Customer Service.” Here are seven rules derived from his insights to start your thinking:

Customers expect a choice of channels. Customers should never be told by a clerk to call customer service, or told on the phone to see the website. You need to anticipate the channel they might choose, and be ready to handle it, or they will look elsewhere, and trash you on Twitter and Yelp.
Self-service needs to have escape hatches. It’s time to end the automated email responses with the “do-not-reply” address. Always end self-help postings with “Did this answer your question?” and provide a next step for those who answer “No.” That means guiding your customer to the top, rather than hiding the top decision maker.
Respect your customer’s view of usability. Usability is recognizing what users have learned from past experience, rather than an abstract science. So don’t move the search bar from the top of a web page, or select a digit other than “0” for getting a human on the phone. Scientific updates to your interface to reduce keystrokes may be self-defeating.
Customers need to be able to shift channels without regression. How many times have you shifted from automated response to a human, and been asked for all the information anew? Anticipate this, and use today’s technology to make the experience seamless. You probably won’t get a second chance.
Self-service has to be monitored and updated regularly. Customer expectations go up as rapidly as the delivery technologies change. Social media apps like Twitter and Pinterest are the latest sources for what’s catching people’s attention today, both positively and negatively. You should be watching.
You and your staff need to regularly use your self-service channels. For the staff, they need to understand customer issues, and you need to test the tone and culture of the people behind the scenes. It’s getting tougher and tougher to outsource this tone and technology to other cultures halfway around the globe.
Ugly upsells through self-service are a brand killer. Amazon handles upselling in a gently suggestive way, with a “frequently bought with” message. Harder sells can backfire, since people like to be pulled in with personalized messages, rather than pushed along with the crowd.

Technology is great for adding speed and flexible delivery to anticipatory customer service, but people are still required to add the heart and the personal touch. More than ever, a startup needs to build an emotional connection with every customer. Reactionary customer service won’t generate the loyalty you need to survive. When was the last time you took a hard look at your service?

Marty Zwilling

Disclosure: This blog entry sponsored by Visa Business and I received compensation for my time from Visa for sharing my views in this post, but the views expressed here are solely mine, not Visa's. Visit http://facebook.com/visasmallbiz to take a look at the reinvented Facebook Page: Well Sourced by Visa Business.

The Page serves as a space where small business owners can access educational resources, read success stories from other business owners, engage with peers, and find tips to help businesses run more efficiently.

Every month, the Page will introduce a new theme that will focus on a topic important to a small business owner's success. For additional tips and advice, and information about Visa's small business solutions, follow @VisaSmallBiz and visit http://visa.com/business.

The Most Admired Entrepreneurs are Servant Leaders

2013-05-14T06:30:00.000-07:00

Startups provide leadership in the market. Entrepreneurs provide leadership to their startup. There are many styles of leadership, like dictatorial, laissez-faire, and democratic. One that I hear discussed more these days, in this age of relationships, is called “servant” leadership.

What is servant leadership? The servant leader serves the people they lead through mentoring, direct assistance, listening, and acting on their employees input. It’s the opposite of self-serving, domineering leadership, and makes those in charge think harder about how to respect, value and motivate people reporting to them.

The concept was developed by Robert K. Greenleaf in 1970. Servant leaders are felt to be effective because the needs of followers are so looked after that everyone reaches their full potential, hence perform at their best, individually and as a team.

Greenleaf says that Martin Luther King, Gandhi, and Jesus were good examples of servant leadership. What do you have in common with them? If you recognize yourself in most of the following questions, you may not be another Gandhi, but you are well on your way to becoming a servant leader:

Do team members believe that you want to hear their ideas and will value them?
Does your team believe that you have a strong awareness of what is going on and why?
Does everyone follow your direction because they want to, as opposed to because they “have to”?
Do others on your team communicate their ideas and vision for the organization when you are around?
Do people believe that you are committed to helping them develop and grow?
Do people come to you when the chips are down, or when something traumatic has happened in their lives?
Does everyone have confidence in your ability to anticipate the future and its consequences?
Does the team believe you are leading the organization to make a real difference in the world?
Do people believe that you are willing to sacrifice your own self-interest for the good of the team?
Does everyone feel a strong sense of community in the company you lead?

Some of the characteristics implied in these questions come more naturally to some people than others. Experts argue that some are inherent, and are difficult to learn. But characteristics such as listening, awareness, persuasion, and building community are all learnable skills.

You should reflect and thoughtfully assess the degree to which you have what it takes to be a servant leader. If you are committed to being the best servant leader than you can be, I urge you to continuously work to develop these characteristics.

For some executives, serving people's needs creates the image of being slavish or subservient, not a very positive image. In addition, leaders need to serve the needs of customers and stakeholders, as well as those of team members, so a sense of balance is required.

For comparison purposes, autocratic leaders tend to make decisions without consulting their teams. Laissez-faire and democratic leaders normally allow people within the team to make most of the decisions, based on consensus. In reality, the very best leaders are those who can use a variety of leadership styles effectively, and use the right style for each situation.

I encourage you to take a look in the mirror, and check your leadership style. Just to make sure you are not looking through rose-colored glasses, ask a few of your most trusted associates what they see. If the answers surprise you, it may be time to find a leadership mentor.

Marty Zwilling

Key Techniques From Startup Leaders Who Get-It-Done

2013-05-13T06:30:00.000-07:00

The universal challenge of every startup founder is to get everything done that needs to get done, and still have a life. Even outside of business, everyone wants to accomplish more, while working less. I’ve been a student of these techniques for some time, but some time ago I saw a great summary that seems to pull all the key principles together.

Stever Robbins, known on the Internet as the Get-It-Done Guy, outlines his strategies in his book “9 Steps to Work Less and Do More.” These are not aimed specifically at entrepreneurs, but I see how they can be applied there as follows:

Living on purpose. Figure out what’s really important to you as an entrepreneur. For most, it’s following a passion to show customers your better solution. Live your lifestyle, do what you love, and identify your top priorities. Then you will get things done, and it won’t even seem like work.

Stop procrastinating. Procrastination is a killer when it comes to being effective. One of the best ways to stop procrastinating is to break things down into small chunks, using tiny steps to move forward. Break time into pieces. When there’s an end in sight, it’s a lot easier to get down to business.

Conquer technology. Cellphones, laptops, and other electronic devices are supposed to give users additional freedom, but far too often, they create time traps. Separate yourself from technology on a regular schedule to not allow a machine’s interruptions to set your day’s agenda.

Beat distractions to cultivate focus. You need to set boundaries and say “no”; to stop multitasking; and to find ways to group similar tasks or similar contents. Don’t forget to delegate to other team members, and don’t be tempted by the current “crisis” to postpone the important tasks of strategy decisions and monitoring the progress of the business.

Stay organized. Many people confuse ‘organized’ with ‘neat.’ In fact, organized means a place for everything and everything in its place. When you stumble over something that doesn’t have a place, either throw it away or make a place for it. If you don’t have any more room, throw something away – don’t rent a storage unit.

Stop wasting time. Work is whatever you need to do that most matches your business goals as they are today. Use the 80/20 Rule to pick and then complete those taks. Stop trying to do things perfectly. “Good enough” is the antidote to perfectionism. Make faster decisions by limiting the options you consider.

Optimize. Stop doing what isn’t working so you’ll have the time to optimize the rest of what you do. Some of the best ways to optimize include using team feedback to identify blind spots that could be limiting effectiveness; recognizing when it’s time to call in an expert to get the job done; and listening to your own advice.

Build stronger relationships. Build a network of contacts to allow you to harness the power of others’ strengths. Superficial relationships don’t help. Giving is the best and quickest way to strengthen a relationship. Conflict takes energy to sustain, so work to prevent conflicts from arising, and work to end conflicts quickly that do arise.

Leverage. Use technology thoughtfully to automate things that take a lot of time, thus gaining leverage. Reuse things rather than re-inventing them. The most valuable computer function in business is “cut and paste.” These days, on the Internet you can find samples of every document and contract you will ever need, so use them.

With each of these steps, you will reclaim more control of your business and your life. You will find yourself honing in on the things that actually move the startup forward and make you happy, and learning the skills you need to resist the rest. You too can be a get-it-done guy.

Marty Zwilling

Is Your Startup Moving Fast Enough to Stay Ahead?

2013-05-12T06:30:00.000-07:00

In today’s business startup environment, if you don’t move fast, you get run over. Without a sense of urgency, people and businesses just can’t move fast enough. Speed is the driver because customers have a zero tolerance for waiting, and there are always competitors gaining on you.

John P. Kotter, in "A Sense of Urgency," delves into the how-to required of entrepreneurs on that first step, avoiding pitfalls along the way. He is convinced that increasing the sense of urgency is the toughest of the steps necessary for effective change.

Urgency is not frantic activity born of excess energy, anger, or frustration. These do result in high activity levels, but results will be slow in coming and often misdirected. Here are six more positive steps to increasing a true sense of urgency, according to Kotter:

Behave with urgency every day. Always demonstrate your own sense of urgency in meetings, interactions, memos and e-mail, and do so as visibly as possible to as many people as possible. You are the role model for everyone in your organization. If your tone or actions lack urgency, it percolates quickly to everyone, and you reap what you sow.
Consistently communicate urgency. Urgency is a set of thoughts and feelings, as well as a compulsive determination to move and win now. Aim for the heart, not just the mind. Look for the element of every story that will compel employees into action. Make employees feel empowered, not stressed, to buy into the need for urgency.
Create action that is relentlessly aimed at winning. Make sure your actions are exceptionally alert, and focused on success. Show some progress each and every day, and constantly purge low value-added activities. Be quick to reward the winning actions of everyone on the team.
Bring the outside in. Be on the lookout for compelling data, people, video, websites and other important messages from outside the company. Strive to connect internal activity with external happenings and challenges. Highlight competitor wins in the marketplace, and continually challenge your own team to do better than competitors.
Find opportunity in crisis. Always be alert to see if crises can be a friend, not just an enemy, in order to destroy complacency. Think of crises as potential opportunities, and not only dreadful problems that automatically must be delegated to the damage control specialists. But don’t assume that crises inevitably will create the sense of urgency needed to perform better.
Deal with the urgency-killers. Remove or neutralize all the relentless urgency-killers, people who are not skeptics but by their actions keep a group complacent or create destructive urgency. Examples are people who are always “too busy” or stretch every task delivery beyond reasonable limits.

One of the main obstacles to a sense of urgency is complacency, which often sets in after a success. When the CEOs and employees are riding high on a wave of profits, complacency can creep in unnoticed. It's easy to hand out rewards and praises without looking down the road and outside the box. Eventually a competitor comes along to trample you into the dust.

Another frequent obstacle is the false sense of urgency. The enemy of urgency is a full appointment calendar, when everything becomes urgent. Here you need flexibility, smarts, and guts to reprioritize less important tasks, or purge them altogether.

Finally, eliminate fear, both fear of failure and fear of success. Fear thrives in an environment where people get punished for mistakes and discouraged from experimenting. Fear of success means people worry that success will bring uncomfortable or distasteful changes.

So my challenge to each of you is that you wake up each day with a sense of urgency both at work and in your personal life, and practice the recommendations above. Constantly critique your business and look for opportunities to improve. Lead by your actions, and the team will follow.

Marty Zwilling

How Entrepreneurs Qualify for Funding from Banks

2013-05-11T06:30:00.000-07:00

A common question I get is “How do I get a bank loan to fund my startup?” The default answer is that it probably won’t happen, because most banks just don’t make bank loans to startups. The failure rate is just too high, and startups typically don’t have the assets or revenue stream to back up the loan. That’s why Angel investors are so sought after by entrepreneurs.

In my experience, some startup founders do overcome these odds, but you need to be realistic and do your homework. Here are some tips and rules of thumb to improve your odds and help you understand when a bank loan or line of credit is possible, and how to get it:

Write a good business plan first. Approaching a banker without a business plan, and asking for money, is a sure way to be rejected and leave a bad first impression. Pay particular attention to the financials, and have a CPA friend review for reasonableness before presenting.

Clean up your credit rating before you apply. Good credit ratings, both personal and business, are essential to getting a loan or line of credit. This is just common sense, since every loan has a repayment schedule, and your credit score reflects your track record of paying bills on time.

Pick a business domain that is squeaky clean. Certain business sectors have historical high failure rates and are routinely avoided by banks and investors. These include food service, retail, consulting, work at home, and telemarketing. Also, don’t expect enthusiasm for your gambling site, porn site, gaming, or debt collection business.

Show a significant personal investment. Most loan programs, and most investors, want to see that you have “skin in the game’ before helping you. If you have nothing at risk, your own level of commitment is suspect. As a general rule, your investment should be at least 20% of total projected loan requirement.

Demonstrate an ability to repay from revenues, not collateral. Bankers will insist that you have collateral to back the loan, like equipment, or even your home. They actually prefer to see that you have a revenue stream to repay the loan, since they don’t want to own another home. The more conservative ask for two years of positive cash flow.

Demonstrate experience in starting a business, ideally in this domain. Bankers, like investors, fund people rather than ideas. Your idea alone will not get you a loan, but your experience running businesses may get you a loan, even if not intimately related to the current proposal.

Conduct meetings at your site, not at the bank. You have an advantage if you can get them on your turf, and even get several key employees to tag-team the presentation. If you are a startup operating out of your garage or basement, you are likely too early in the cycle to get banks interested.

Eliminate your salary from the use of funds. Most startup founders don’t take a salary for the first year or two, since most investors as well as bankers won’t give you money so that you can pay yourself. The most positive use of funds is to buy raw materials to build product for existing customer orders. In fact, customer orders are great collateral.

Even if you can’t meet all these criteria, it’s definitely worthwhile to utilize the free services of the Small Business Administration (SBA) and SCORE in the US to get their help in preparing for the loan option. They have contacts with the more “startup friendly” banks in your area, like Silicon Valley Bank, and might even be able to arrange a “loan guarantee” if you meet these criteria.

In all cases, the loan option should be investigated before looking for an Angel investor, since the “cost” of a loan is usually considered less than giving up a large share of your company equity and control to Angel or venture capital investors. I’m told that 21 companies on the Inc 500 list started with bank loans, so you can do it too.

Marty Zwilling

7 Startup Habits Investors Read as Staying Power

2013-05-10T06:30:00.000-07:00

I’m always looking for evidence of early startup characteristics that might be predictors of long-term success. Every investor has his own list, usually based on his own very small sample, or simply his gut feeling. Of course, we would all like to have a magic list based on more definitive tracking of many real startups over time.

In that context, I came across an old study of 27 startups featured in Inc’s annual “Anatomies of a Start-up,” done for “The Journal of Business Venturing,” and published by George Gendron in Inc Magazine. As it turned out, 17 of the 27 companies were still in business seven years later, which is at least double that of other studies. The points all still ring true today.

To determine what factors made a difference, the researchers compared the 27 companies using numerous variables. Of all those variables tested, only seven proved to be reliable predictors of survival. Here is my own net of those seven habits:

Founder is ready, willing, and able to learn. We have all known entrepreneurs whose egos are so large that they can’t be bothered listening to any advice from friends or experts, and they insist on doing things their way. Effective entrepreneurs are always open to learning, no matter what their prior experience.
Seek out established suppliers and channels. The challenge of a creating a new product or service is tough enough, without insisting on a new supply chain, and a new distribution channel. The most effective startups focus on their core competency, and work hard to pick the best of the rest for partners.
Pays close attention to new potential competitors. Effective startups are never comfortable just because the features they plan for rollout in six months are ahead of what competitors have now. Things move fast in the startup world, and real competitors never stand still. Reassess new entrants and competitors every month.
Spend more time on initial positioning. Like the old saying, you only get one chance for a great first impression. Overcoming a bad image, or even changing a non-image, takes lots to time, money, and effort. Your initial business identity can make or break your startup.
Do your homework on minimal capital requirements. Usually that means have a Plan B and Plan C, just in case your initial source doesn’t materialize, or takes much longer to finalize that you expected. Running out of capital in midstream is a brick wall that can derail even the best plans.
Offer customized products or services. It’s very difficult for a startup to jump quickly to the volume required to sustain them as the low-cost producer. Big gorillas with deep pockets find it hard to scale products that are designed or produced to order.
Choose a large market in a growth industry. By definition, a growth industry has a history and an outlook of at least double-digit annual growth. A large market means at least $500 million in potential sales if the company is asset-light, and $1 billion if it requires plenty of property, plants and equipment.

This study jibes with other academic research in showing that no single factor is a reliable predictor of success, but taken together they do add up to a considerable advantage. In my view, a necessary but not sufficient first predictor of success is the habit of building a plan.

It’s the plan building process that provides the value, and gives you real insight into your market, your customers, and the competition. After that, it’s all about learning and execution. If you see a startup with the execution habits listed above, that may be the horse you want to bet on, and ride to the finish line.

Marty Zwilling

A Sustainable Business Requires Time and Practice

2013-05-09T06:30:00.000-07:00

Entrepreneurs seem more quickly frustrated these days when their “million-dollar idea” doesn’t turn into a sustainable business overnight. They don’t realize that it takes many skills to build a business under the best of circumstances, and today’s world of instant gratification doesn’t leave room for the patience and practice to develop these skills.

Successful sports figures and musicians have long understood the value of time and practice in perfecting their skills. So why do entrepreneurs think that building a business is intuitively obvious, and should happen overnight? Building a business is a complex task, like building the product or service, and requires the same focus, discipline, and practice to get it right. Even the revered Steve Jobs of Apple didn’t get it all right the first time.

In his latest book, “The Practicing Mind,” Thomas M. Sterner outlines how people learn the necessary skills for any aspect of life, from golfing to business. He emphasizes the importance of a practicing mindset, and provides some clues on how to offset our modern culture of habitual multitasking, short attention spans, and giving up quickly in the face of any setback.

He believes, and I agree, that creating the practicing mind, and acquiring any skill, without stress and futility, comes down to following a few simple disciplines:

Keep yourself process-oriented. As entrepreneurs, we have a very unhealthy habit of making the product or service the focus, instead of the process of “changing the world,” which was the big vision in the first place. When you focus on the process, and see progress and learning with each small step, all pressure drops away.

Stay in the present. In business, the world of customers and competitors changes every minute, so you learn by iterating and listening, taking all feedback as positive progress, rather than delays and mistakes. Don’t lose touch with your original dream, but fixating on the “final” solution is not productive or satisfying.

Make the learning process your goal. Use the original dream as a rudder to steer your efforts. Success in business comes to those who learn most quickly, and adapt their processes most effectively. Don’t get caught up in achieving the exact product or service of your entrepreneurial dream, because it’s almost always wrong anyway.

Be deliberate, and keep a clear picture of your destination. A random walk does not lead to business success. Deliberate intention is focused on a destination, but realizing that every step need not be predicted. Being deliberate is making each iteration land nearer to the destination, focusing on positive thoughts and positive actions.

Most of the anxiety that entrepreneurs experience comes from the feeling that there is an end-point of perfection in every product and business. The reality is that there is no ultimate product or business, since each improvement or business growth increment brings a whole new set of challenges, requiring more learning, more practice, and more skills.

Practice is required to replace bad and unproductive habits, like too much multitasking, with desirable habits, like solving important challenges more often than the crisis of the moment. Building new good habits is important, since they allow you to do required things effortlessly and without overt planning each time.

Even this is a process that must be practiced. First you have to be self-aware, and decide on what you want to be a habit. Then set up triggers to help you remember the action and the time, and finally make sure you have clear motivation for the action. Practice is the required repetition on this action with patience, until it’s effective and automatic.

Entrepreneurs should not be afraid to use the terms failure and practice interchangeably, since investors often conclude that startups learn more from failure than from success. Obviously, it’s to your advantage to make your practice steps small ones in time and cost. Successful professionals actually enjoy honing their skills through practice. Are you having fun yet?

Marty Zwilling

Startups Should be Wary of Disruptive Technologies

2013-05-08T06:30:00.000-07:00

How many times have investors heard startups start their pitch by touting that their technology is “disruptive?” What entrepreneurs forget or don’t realize is that most customers are initially wary of any technology, that educating the market on new technology is expensive, takes a long time, and people buy problem solutions rather than technology anyway. Investors will wait for more traction.

The concept of disruptive technology was first introduced by Clayton M. Christensen in “The Innovator’s Dilemma” way back in 1995. Such technologies, like the digital camera and mobile phones, introduce such novel concepts that they displace existing technology quickly by societal standards. Unfortunately this “quickly” may be too slowly to save initial startups in the space.

In this time of constant change, it’s easy to conclude that everyone is an early adopter, and we all tend to forget quickly the time and stages we go through while adapting to new technologies, and then loving them. I saw a recent article on HBR “The Five Stages of Disruption Denial,” by Grant McCracken, comparing technology adoption to Kubler-Ross’ five stages of grief:

Confusion. We don't quite get it. We sign up for the new app, or buy one of the new devices after we see our cool friends using it. We give it a whirl, and quickly complain that things were easier the old way. By this time, gurus are reassuring us that it is the greatest thing ever. But that doesn't help. We decide to wait another year for the next version.
Repudiation. There are many people who don't get the new technology, and now social life is a little like a competition to show that we're not "falling for it." At this point, there can more social capital in saying that we don't like the technology than that we do. We now hear snappy one-liners like, "Twitter. What could I possibly say in 140 characters?"
Shaming. This is when we are so persuaded that we're right and the new innovation is wrong that we are prepared to make fun of the credulous among us. "This Twitter thing. It's just a fad. Give it a couple of months and it will go away." We heard a lot of this sort of thing about Pinterest in the early days. Now it's valued at $2.5 billion.
Acceptance. By this time, the innovation is taking off. The middle adopters are signing on. It is clear now even to late adopters (the great majority) that there is at least one useful aspect of the new technology, and it’s here to stay. Confronted by accomplished, irrefutable fact, the rest of us cave in, sign up, and brag about how modern we are.
Forgetting. This is where we destroy the evidence, even in our own mind. Now we are inclined to act as if we always understood and approved of a world instilled with new innovation. One minute, we are too smart to be fooled by Twitter. The next we are fully on board. It's a like high school. We are captives of what Mark Earls calls "the herd."

In the old days, it typically took 20 years for this process to happen. Now it happens much faster, but it still takes longer that the survival lifetime of a struggling startup. Smartphone acceptance is now around 50%, about six years after the first Apple iPhone was introduced. There is other evidence that may be the new norm.

Marketing guru Seth Godin mentioned in an article a while back that “it takes about six years of hard work to become an overnight success.” Mark Zuckerberg spent about 7 years and $150 million before Facebook became cashflow positive. MySpace and several others, who arguably pioneered the disruptive social media technology, never really survived to enjoy it.

Too many of the startups I know who highlighted their disruptive technology early ultimately ran out of money and had to shut down for being “ahead of their time.” They did everything right, but the market just wasn't ready. Sometimes this is just an excuse for other problems, but don’t forget the old investor saying: "being early is the same as being wrong."

Overall, I think more startups do fail by being too early to market than fail by being too late. This is probably a hard message to swallow, but it’s usually the second mouse that gets the cheese. What are you doing to avoid this trap with your disruptive technology?

Marty Zwilling

What is Your Entrepreneurial Leadership Potential?

2013-05-07T06:30:00.000-07:00

Entrepreneurs inherently understand that they have to be the initial leader of their startup, but often they don’t have the experience or the training to know where their leadership competencies lie, or how to build a leadership team. For new entrepreneurs, leadership development efforts may be more valuable for achieving startup success than business skills development.

Very few people know their own leadership style, or strengths and weaknesses, despite their many years of living and working in the real world. To assess where you are, and to unlock your full potential, there are many courses available, as well as seminars and gurus, but a good place to start is a book on the subject, like the new one from John Mattone, “Intelligent Leadership.”

Mattone has a wealth of insights, based on years of helping Fortune 500 leaders overcome their self-imposed limiting leadership habits. He identifies and distinguishes between nine distinct leadership traits that I see in all entrepreneurs, to some degree. The most effective entrepreneurs know their own predominant traits, and how to build a team with all the rest:

Helper. Mature Helpers are considerate and genuinely the most sensitive and caring of all the leadership types. They are excellent mentors and coaches, but have a strong need to be admired and respected in return. Strengthen this trait by being more conscious of your need to be liked, and don’t be possessive or controlling.
Entertainer. Entertainers gain the respect of others with drive, determination, hard work, and the ability to win over people. But they can become fixated with appearing successful, showing more style than substance, or undermine themselves by exaggeration, inflating their importance, or trying to win or one-up all the time.
Artist. Artists are perhaps the most creative and innovative leaders. They tend to move people deeply, and bring out the most in people. As they become more mature, they draw less inspiration from themselves, and more from others. Improve your artist side by avoiding negativity, procrastination, and focus on self-discipline.
Thinker. Thinkers like to analyze the world around them, and may prefer thinking to doing. Mature Thinkers quickly understand problems, can explain them to others, and make sound and logical decisions. Strengthen this trait by not jumping to conclusions, seeking advice, and working cooperatively with others you trust.
Disciple. Disciples are able to form strong and cohesive work groups, but sometimes appear incapable of action without permission of an authority figure or belief system, and don’t seek out leadership positions. This trait can be strengthened by accepting accountability, reducing reaction to stress, and cutting ties to authority.
Activist. Activists are good at lifting the spirits of team members and managers, and are usually optimistic and confident. They tend to bury themselves in activities, but can be impulsive and select quantity over quality. Improvement efforts would include listening more to people, thinking about details, and learning to say no.
Driver. Drivers are the most openly aggressive leaders, who enjoy taking charge, and can make things better with their immense self-confidence. Unfortunately, they may feel the need to dominate every situation, and make every decision. Mature ones act with more self-restraint, let others win, and work with others.
Arbitrator. Arbitrators tend to be the most open of all types. What you see is what you get. They find ways to bring people together, and ways to involve everyone. To be a better Arbitrator, you need to be more assertive, more open, share your feelings, and work on developing your listening skills.
Perfectionist. Mature Perfectionists are capable of being highly noble leaders, with their deep sense of right and wrong and ethical principles. They are usually highly critical of themselves and others, and often frustrated by reality. To improve, they need to learn to relax, listen to others, and remember that no one is perfect.

In all cases, to reach your highest leadership potential, you have to stay true to yourself, rather than trying to conform to other people’s images of the best you. If you truly commit to learning more about yourself and becoming the best that you can be, while possessing a great attitude, you will discover that all challenges are really the seeds of opportunity.

Most recognized entrepreneur leaders admit that their biggest challenge was to break through their self-imposed limiting thoughts, emotions, and habits, to reach the next level. How many of these leadership traits have you mastered, how many are you working on, and how many of the other strengths have you built into your team to help you? That’s intelligent leadership.

Marty Zwilling

*** First published on Young Entrepreneur on 04/29/2013 ***

10 Tips For Entrepreneurs on How to Hang Tough

2013-05-06T06:30:00.000-07:00

In sports, mental toughness is defined as the ability to focus on and execute solutions, especially in the face of adversity. If anyone in business ever needed mental toughness, it’s an entrepreneur. Investors tell me that startup success is all about execution, all while facing determined competitors and overcoming customers’ resistance to change.

Dr. Jason Selk, in his book “Executive Toughness,” talks about mental toughness with analogies between sports and business, but he never takes it all the way to entrepreneurs, where I believe it can have the most impact. So here is my interpretation of the fundamentals he outlines, adapted to the language of a startup:

Define the win for your business. A startup is not a parlor game. With a for-profit startup, it’s all about solving a problem that embodies real pain, for real customers who are willing and able to pay for a solution. For social entrepreneurs, it’s all about making the world a better place. Figure out early what it takes to win, or you will lose by default.
Adopt a business vision that fits your self-image. In every case, you need a long-term vision that drives self-fulfillment and self-image as well as business success. Assess your strengths and weaknesses, and visualize how these will lead to business success. If the vision doesn’t fuel your passion and match your skills, you won’t like the lifestyle.
Establish real business goals and processes. It’s hard to achieve things that have not been defined, and the steps to get there are not clear. I recommend a business focus on a one-year timeframe, with a limit of three product goals and three process goals.
Prioritize the priorities. Prioritize or perish should be every entrepreneur’s mantra. Accountability requires splitting your big product goals into daily process goals and scheduling them to completion. Don’t get distracted with the unimportant.
Practice accountability through self-evaluation. Learn to look in the mirror every day. No evaluation means no awareness of how you are doing, which gives you no basis for improvement. Good performance does not require perfection, which is unachievable.
Control your emotions to control your performance. Learn to control the degree to which your nerves and emotions are engaged and on alert. By maintaining basic mental stability and physical fitness, and preparing yourself intellectually you will function more effectively and successes will grow.
Prepare to say the right thing. Practice your response to the three most common situations you face. Creating and documenting scripts, like your elevator pitch, for key interactions help you and your team maintain focus. They build confidence and reduce the anxiety that often gets in the way of leadership performance.
Prepare mentally every day. Your mind can be strengthened every day, just like a muscle. Complete a mental workout every day to dramatically improve your focus and ability to execute consistently. It’s one of the most effective methods known for training your body and mind to stay under control and perform to your potential.
Develop a relentless and optimistic solution focus. Replacing all negative thinking is one of the most critical pieces of your mental toughness puzzle. Approach all solutions one step at a time, where a step is any improvement to the current situation. Remember that a focus only on problems will likely cause more problems.
When you set your mind to do something, find a way to get it done, no matter what. While a relentless solution focus is the mental step, discipline is the action step that makes solutions materialize. In this way, discipline delivers success. Make discipline a habit by limiting temptation and conscious practice.

We all need these fundamentals of mental toughness to succeed and lead in today's business environment. It takes more than market knowledge and technical skill alone. That’s the fun part of the challenge to most serious entrepreneurs. If it was easy, anyone could do it. Are you ready to step up to the plate?

Marty Zwilling

9 Steps to Entrepreneur Real Social Media Results

2013-05-05T06:03:00.000-07:00

If you are an entrepreneur these days, or trying to grow an existing business, everyone is telling you that you need to use social media. There are many ‘experts’ out there telling you how to do it, or even offering their services. But very few are talking about how to measure your results, and the right metrics for optimizing your marketing environment.

Jim Sterne, who has written many books on Internet advertising, marketing, and customer service, tackled this complex world of social media metrics in his book titled "Social Media Metrics." He has one of the first books on this subject, and he breaks the process down into nine steps, as follows:

Get focused and identify goals. Social media is the realm of public opinion and customer conversations. If you don’t have a clear idea of why you are there, anything you measure will be useless. He suggests you begin with the “big three” business objectives of higher revenue, reduced costs, and improved customer satisfaction.
Get attention and reach your audience. Measuring message delivery in social media is a lot like measuring it in classic advertising, so classic metrics apply. With social media, it is also important to identify how many people see your message as remarkable. That leads to the extra reach of word-of-mouth, commenting, and telling their friends.
Measure respect and find influencers. Your task now includes reaching the people who are key influencers, and understanding their impact. Therein lies the multiplier effect. Your message multiplier velocity and reach are the signals that your offerings have the right scope, spread quickly, and resonate with your target audience.
Track the emotional sentiment. Counting is fine, but analyzing the outpouring of millions of souls can reveal attitudinal shifts. Tracking public sentiment over time provides invaluable insight and gives you the chance to stay right on top of changes in the marketplace and your organization’s brand equity.
Measure customer response and action. If they read it and like it, do they click through to your web site, or engage with your organization in new and different ways? Action is when people are drawn into a profitable and sustainable relationship with your company. That’s where the money is.
Get the message from your customer. With the customer in control, you need to make sure you are getting the right message from the right people at the right time. That’s real-time market research, and you need to measure how well you are hearing it and acting on it in your business strategy planning.
Drive business outcomes and get results. Now it’s time to cycle back around to measuring what sort of business impact your efforts are having. Measure to see if you have an increase in revenue, a lowering of costs, and improvement in customer satisfaction. Then it’s time to re-examine your goals to look beyond the “big three.”
Get buy-in from your colleagues. Some executives are slow to understand and embrace new communications methods. Use your results to convince them that social media is a vital part of your marketing mix, and deserves the resources necessary for proper implementation and measurement.
Project the future. Start now to look at where social media will be in two to ten years, and prepare for it. Don’t let the changes takes your organization by surprise, or allow your organization to be the last to implement and measure you in the new world.

The tools to help you with all these actions are still evolving. You can scan the Internet for the many offerings to gather data, but the evaluation of the ‘why’ behind the results is still largely manual. That’s the insight you need to support your efforts to reach higher performance goals. The sooner you find these insights, the quicker you can make better decisions to positively enhance your bottom line.

Marty Zwilling

10 Tips From Entrepreneurs Who Made Their Own Luck

2013-05-04T06:20:00.000-07:00

Did you ever wonder why some entrepreneurs always seem to have all the luck and success, while others never seem to catch a break? As an Angel investor, I quickly learned that luck has very little to do with it, and I now look for some personal characteristics and leadership styles that separate the potential winners from the losers.

These differences are the reason that investors say that they invest in people, rather than ideas. As I was reminded recently in a recent book by Dennis Perkins, “Leading at the Edge,” this isn’t a new concept. He illustrates this by comparing the acts of numerous teams which faced the edge of life and death as early Antarctic explorers in the 1800s.

He was able to identify ten strategies that were the common threads to survival in the winning explorer teams, which I believe apply equally well to the survival and success of business startup teams today:

Never lose sight of long-term goals, but focus real energy on short-term objectives. Don’t be afraid to pivot, and commit to new objectives with as much passion and energy as the original. Andy Grove of Intel fame started making memory chips, but switched to microprocessors with a vengeance when Japan totally undercut his pricing.
Set a personal example with visible, memorable symbols and behavior. Under the stresses of a startup, visible leadership cues can make the difference between success and failure. When McDonald’s was still a small company, Ray Kroc, the CEO, had a penchant for asking a store manager to help him clean up trash in their parking lot.
Instill optimism and self-confidence, but stay grounded in reality. That means you must first find optimism in yourself. Then it extends to the hiring process. Herb Kelleher, while CEO of fledgling Southwest Airlines, said he only wanted people with positive attitudes. He also famously said," We don't do strategic planning. It's a waste of time."
Take care of yourself: Maintain your stamina and let go of guilt. Evidence shows that effective entrepreneurs have high levels of energy, and handle stress well. But no one is superhuman. I once worked for a CEO of a startup company who insisted on working 20 hours a day, until a health crisis almost killed her, and did kill her company.
Reinforce the team message constantly: “We are one – we live or die together.” Teamwork is the hallmark of high-performing startups. Establishing a shared identity is the first step to creating unity. The Google team stayed tight as they developed the technology, first working out of Larry Page’s dorm room at Stanford, then a garage.
Minimize status differences and insist on courtesy and mutual respect. CEOs who talk, and really listen, to everyone in the organization gain the highest reputation. Amazingly, Tim Cook, current CEO of Apple, has surpassed Steve Jobs high score, and was ranked by a Glassdoor Survey as the #1 respected CEO as voted by employees.
Master conflict – engage dissidents, and avoid needless power struggles. Some entrepreneurs go to great lengths to avoid interpersonal friction, or engage the wrong way. Those of you who viewed the movie The Social Network, saw some examples of entrepreneurs dealing with conflict poorly, almost leading to the demise of Facebook.
Find something to celebrate and something to laugh about. Especially under the constant pressures of a startup, the ability to lighten up, celebrate, and laugh can make all the difference. Herb Kelleher, mentioned earlier, is one leader who also understood the power of humor in business, with his own antics, and focus on “fun ware.”
Be willing to take the Big Risk. Risk aversion does not always result in disaster, but neither does it create change. Risk takers make things happen. Think of the risk taken by CEO Todd Davis of LifeLock when he posted his Social Security number online, to assure customers the he could protect them from identity theft. It worked.
Never give up – there’s always another move. Rather than expecting things to go right, entrepreneurs have to assume things will go wrong, and solutions are elusive. Colonel Sanders started at a late age to build his chicken recipe into KFC (Kentucky Fried Chicken). It took two years of persistence to get the money. The rest is history.

Investors (and team members and partners) find that it’s more effective to assess an entrepreneur’s fit to these personal characteristics than it is to assess the real potential of an idea, or the probability of good luck. We listen to you and judge how many of these are practiced by you. When it’s time for due diligence, we will talk to your team. Their perception is the only reality. What do you think they will say?

Marty Zwilling

Your Social Media Profile is the Resume that Counts

2013-05-03T06:07:00.000-07:00

With the advent of LinkedIn, Facebook, and dozens of other websites requiring your profile, the old-fashioned written resume is simply an artifact of a hiring practice that is slow to change, and should be abolished. In fact, if your profile is not already on one of these sites, it probably means that you aren’t in the business market anyway.

Today, most personnel organizations readily admit that they already use the Internet to cross-check what they see in your written resume. You can bet that if the stories don’t match, they will more likely believe the online version. That’s why I emphasized in an old article, “Google Yourself to See How Other People See You,” how important it is to keep your online image clean.

In reality, it doesn’t matter whether you are preparing an online profile for your favorite social network, or a written resume (Curriculum Vitae) in the old-fashioned sense, you need to make certain that it helps your case rather than hurts it. Here are some tips on how to make yours stand out above the crowd:

Focus on results. By focusing on results produced and on the needs of the employer, you’ll stand clearly apart from 90 percent of other applicants. Their profiles say, in effect: “I worked these jobs.” Your profile should say: “Here are results you can expect.” That’s much more refreshing and enticing.

Make it look professional. You only get one chance for a good first impression. Choose a couple of readable font styles and sizes, and no bright colors or highlighting. Spell check and proofread many times – a single typo or incorrect word can get you rejected.

Include a current picture. Every professional needs to look professional. You can’t hide, so be proactive and look your best (online or on paper), with a small headshot, rather than force the recruiter to find some not-so-attractive shots on Facebook or Twitter outside your profile. A cartoon picture or picture of your pet won’t impress anyone.

Don’t leave time gaps. Big time gaps in your professional life are a red flag. Did you skip those years because you were raising a family, unemployed, or in jail? A short entry for the period, stated as positively as possible, will leave a better impression, and avoid embarrassing questions later.

References on request. Mention that references are available, but including them in the profile can leave the impression that these are very generic. Personal references should be customized to support specific requests from a potential employer, and confirmed by you prior to employer contact.

Executives tell me that they are continually frustrated that most of the resumes they see still sound like “job descriptions?” We need to know what you did, not what you were supposed to do. Words like “assisted” and “supported” are not results. Fuzzy words will hurt you.

Offline, it’s a good strategy to customize your resume to match each opportunity. For example, if you are looking at an entrepreneurial position, show a background in leadership. Mention entrepreneurial groups, and highlight groups you started all the way back to college. If it’s an executive position, highlight your results in that context.

I suspect the day is near when Wikipedia will make even social network profiles obsolete, meaning that every professional will have a public profile entry, maintained by a vast number of “online volunteers” (see Bill Gates, for example). The “open source” cross-check process seems to keep these fairly accurate, and the constraints on who is a “public person” go down every day.

Based on what I see today on Facebook, a lot of people have a long way to go in building that professional resume to show the world. Now is the time to check yours and make sure it highlights your strengths, rather than your shortcomings, before it shows up on Wikipedia and your employer’s desk.

Marty Zwilling

Startup Leaders Must Discard Their Security Blanket

2013-05-02T06:30:00.000-07:00

One of the biggest impediments to starting a new venture is the “terror barrier,” as popularized by Bob Proctor, a 75-year-old millionaire and world renowned entrepreneur. This is the imaginary barrier that always seems to appear at the critical point where we would step out ahead of peers or competitors, but fear causes us to stop short.

Everyone has a comfort zone, or level of risk, where they feel in control. The problem is that if you stay in that comfort zone too long, you don’t learn and achieve new objectives. According to Bob, all growth takes place outside that comfort zone, and the edge of that zone is called the terror barrier.

If you want to be an entrepreneur and start a new business, you must be willing and able to break through your terror barrier. If you hope to succeed with any real “new” opportunity, you must be willing to learn new skills, set high goals, and get out of your comfort zone.

Overcoming the terror barrier requires first a passion for the new dream, willingness to take a risk, and determination to never quit. In addition, it helps to have a few specific strategies, outlined by Ingunn Aursnes a while back, to help you push through:

Reconfirm how you have dealt successfully before with terror barriers. Everyone has had to deal with terror barriers, since the day you were born. Convince yourself that this one is only incrementally larger, not a huge jump. Contemplate the things that have worked before for you, and things that cause you to go off track.

Some people procrastinate, make excuses, or feel real fear. We all have our “security blanket,” like sessions with a trusted friend, classroom training, or prayers to reduce the pain and keep us moving forward.
Set specific goals, rather than rely on a generic dream. Make the goal increments small, so you can see yourself making each step, rather than face a step the size of a mountain. Create a picture in your mind of you achieving your end result, like you getting a Nobel prize for curing cancer, or relaxing on a beach with no more money worries.

Then write down and prioritize your goals. If they are not written down, they don’t exist and it’s easy to forget the real meaning behind them. But don’t be overwhelmed working out the details and all the steps required just now. Work on one step at a time.
Take the first step toward your first goal. You never get anywhere until you start. It doesn’t have to be a big step, but it has to be in the right direction. Put a stake in the ground, and start measuring how far you have gone. Remember that everyone takes one step backward for every two steps forward, so setbacks are normal bumps.

Everyone learns more from failures than from successes. Moving forward, accomplishing goals, is a process rather than a continuous motion. After the first step, the second is easier, and after the first goal gives you confidence, the second will be easier.
Recognize the terror barrier and see it as a growth opportunity. Take satisfaction in widening your comfort zone, the opportunity to learn, and the progress toward your goals. Use your mentor or support organization to get you over the hurdle, and celebrate the success.

For team members, don’t forget your responsibility to help other members over their terror barriers. Helping others is the best way to forget your own fears and build the satisfaction of leadership as well as learning.
Iterate the process, picking up confidence and momentum along the way. The more you persevere and keep moving in the direction of your goal, the easier it will seem and the better the results you will achieve. Even if the terror barriers get tougher, they will seem easier as momentum helps you achieve more of your goals.

People who avoid facing the terror barrier, or who back away easily, are actually falling behind, and they will quickly become less confident, less determined, and less happy. You want the spiral to go the other way, toward greater levels of success, ability to achieve greater goals, and to be a successful entrepreneur. Follow these steps and put your terror barriers behind you.

Marty Zwilling

5 Post-Recession Initiatives for Every Good Startup

2013-05-01T06:30:00.000-07:00

Every dark cloud has a silver lining. Driven by the recent recession, smart entrepreneurs of all ages are jumping into the fray with new ideas, new recovery strategies, and discarding outmoded business models. I see it most in the newest generation of entrepreneurs (Gen-Y), who were shocked out of entitlement into action by the recession.

Donna Fenn, in her book from a while back, “Upstarts! How GenY Entrepreneurs are Rocking the World of Business,” was one of the first to predict that Gen-Y would lead the charge, bounce back from the recession, and be big winners. She describes a new generation of entrepreneurs that is highly collaborative, quick and alert when it comes to new technologies, and hell-bent on changing the world in general.

Upstarts! examines and analyses this entrepreneurial revolution to reveal critical lessons every Gen-Y entrepreneur and marketer must learn. But the insights I see from her book and elsewhere are equally applicable to startup founders of all ages, and businesses of all ages. Here are five key post-recession strategies that both of us recommend to all of you:

Pursue repeat business. It's far less expensive to nail down repeat business from your existing customers than it is to land new ones. Now is the time to reap the benefits of those good customer relationships that you've been cultivating. Viral marketing campaigns to lure new customers will cost you big money.
Focus on your core competency. Examine every cost center in your business. Maybe it’s time to outsource that call center operation, or complex manufacturing setup. Look for operations that are hogging resources without generating significant revenue. With a concentrated point of focus, your company might be well positioned for growth this year.
Snap up top talent. Past layoffs at big companies usually means more great employees on the market now for newer companies. Examine your pool of higher-paid contractors and freelancers. Now is the time to bring on board those people who would have been inaccessible in a better economy.
Respond rapidly to market shifts. The economy has almost certainly had a profound impact on your customers: they may have altered their purchasing habits, or found themselves with entirely different needs. It's your opportunity to respond to those shifts. These are chances to broaden your product line, change distribution, offer new services.
Look for hidden sources of revenue. Sometimes your best source of new revenue is right under your nose, like services revenue in support of your products. One entrepreneur in Fenn’s book had a proprietary technology to efficiently manage vendors which works so well that she is now marketing it to other companies for a transaction fee.

Most companies I know agree that the recession has taught them the art of laser-like focus, and compelled them to make better decisions, to become more frugal, and to initiate systems and procedures that will help position them in the economic recovery. Simply deciding to lay low and “tough it out” was never a winning strategy.

I agree with Fenn that this recession has actually been a good “wake-up call” for many in the new generation – it has forced them to face the reality of hard knocks. Similarly, it should be a wake-up call for the rest of us, or we will be overrun by young entrepreneurs with their burning desire to control their own destinies.

But I’m convinced that you don’t need to be an “Upstart!” to capitalize on the recession. Use your experience and your expertise to lead the way, or you will be left in the dust. The first step is to execute your own post-recession strategy. Or don’t you even have one?

Marty Zwilling