Young Entrepreneur Council (YEC)

12 Negotiation Techniques for Buying an Existing Business

The Young Entrepreneur Council (YEC) — Wed, 16 May 2012 11:30:19 +0000

Question: I'm currently in negotiations to buy an existing business. What are some negotiating techniques I can use to make sure I get the best deal?

Question by: Sean

Knowledge Is Power

"The person with the most information usually does better in negotiations. Find out what is most important to them and their needs and wants. Leverage this information to gain the upper hand in the negotiations. How do you find out this information? Research and ask questions!"

- Anthony Saladino | Co-Founder & CEO, Kitchen Cabinet Kings

Follow @cabinetkings

Shop the Deal

"Always make sure that you have other opportunities on the table during any negotiation. With multiple opportunities, you will be putting yourself in a much better position during a negotiation. Multiple opportunities will allow you the flexibility to walk away from a deal, in addition to pitting the opportunities against each other to get the best deal possible."

- Derek Johnson | CEO/Founder, Tatango

Follow @@thederekjohnson

Be Ready to Walk Away

"Start with a target price. Make sure your first offer is lower than the target. If you get stuck negotiating on price, remember everything is negotiable. Always establish a walkaway point. If they're not budging on price, tell them you can't do it. If they desperately want to sell their business, walking away from the deal is one of the most powerful things you can do."

- Nicholas Tart | Founder, 14 Clicks

Follow @14clicksNick

What's Important to the Seller?

"When I purchased my first business, I realized that the seller's top goal was to make sure that the business was going to be run by a capable buyer -- not maximizing purchase price. We saved a bunch of money by realizing that he wanted to be comfortable with us, rather than just be blown away by a big number."

- Nathan Lustig | cofounder, Entrustet

Follow @nathanlustig

Start With the End in Mind

"Mental and tactical preparation is the most essential element of successful negotiations. Close a win-win business deal by starting with the end in mind. Always ask for more than what you expect to gain. Develop a collaborative and firm position. Have the courage to ask for the impossible. The results will surprise you."

- Erica Nicole | Founder and CEO, YFS Magazine: Young, Fabulous & Self Employed

Determine the Customer Lifetime Value

"Much of a company's success depends on customer equity, which can be broken down into two things: the dollar amount each customer spends with the company, and the cost of acquiring a new customer. There is a formula for identifying these costs, and it is absolutely priceless in determining a company's value. Search the specifics of this formula and apply it to your analysis."

- Kent Healy | The Uncommon Life

Follow @Kent_Healy

Focus on the Negative

"Ask questions and find out the weakness of the company. When you find out what that weakness is, keep asking questions and find a way to get upset or frustrated about that weakness, almost as if you feel it devalues the company. If you only focus on the negative, chances are the seller of the business will too, and you may get a better deal. Then turn it."

- Louis Lautman | Founder, Young Entrepreneur Society

Follow @louislautman

You Don't Need Them!

"It is crucial, when negotiating to buy a business, to not appear desperate or in need of the purchase. This will leverage your bargaining power in the deal."

- Zach Cutler | Founder and CEO, Cutler Group

Follow @thecutlergroup

Use Objective, Third-Party Criteria

"Use objective, third-party criteria to make sure that the terms of the agreement are fair to both parties. For example, instead of just offering X amount, show what independent sources you looked at when determining the fair market value of the business. Also, think outside the box and proactively look for opportunities to create added value and additional mutual gain in the agreement."

- Doug Bend | Founder/Start-Up and Small Business Attorney, The Law Office of Doug Bend

Follow @@DougBend

True Middle Ground

"Most people think of "best deal" as lowest price. I don’t necessarily think this is the case. When looking for the "best deal," I would often think of the best mutual win for both parties. Last year, I have made five acquisitions, and I am confident that I could give "acquisition references" for anyone new who I am talking with."

- Ryan Holmes | CEO, HootSuite

Follow @invoker

Know Thy Value and Costs

"Negotiations are not about perfect technique, but rather more about finding mutually beneficial solutions. Although both sides are self-serving, no one can argue with costs. If a certain number is too low for you, stand your ground. Maintain your value by emphasizing that, and how anything below your final number is impossible with your costs. Even the most stubborn negotiator understands that."

- Nick Friedman | President, College Hunks Hauling Junk

Do Your Research

"Make sure you get all tax returns and profit and loss statements since their inception, as tax returns don't lie. These statements give you an idea if the company was mismanaged. Because you're an entrepreneur and instinct will guide the ultimate decision as to whether or not to buy, at least the tax returns will help you negotiate a better price!."

- Michael Sinensky | Owner, Village Pourhouse

The Young Entrepreneur Council (YEC) is an invite-only nonprofit organization comprised of the world’s most promising young entrepreneurs. The YEC recently published #FixYoungAmerica: How to Rebuild Our Economy and Put Young Americans Back to Work (for Good), a book of 30+ proven solutions to help end youth unemployment.

Starting Up? Avoid These 3 Common Mistakes

Abbie Davies Steinbacher — Wed, 16 May 2012 11:00:33 +0000

Oops © by dingler1109 (2010)

The opposing forces of the economy tanking and technological advances soaring have created a prime environment for first-time entrepreneurs. That said, “entrepreneur” has become a buzz word associated with the few startup founders we’ve watched become millionaires, and even billionaires, overnight. As the media catapults these successful entrepreneurs to celebrity status, the separation between “us” aspiring entrepreneurs and “them” — the Mark Zuckerbergs of the world — grows. This growing separation can cloud your entrepreneurial pathway with unnecessary mystery.

From my experience as founder of the kids’ yoga company, My First Yoga, I have found that as different as each startup may be, the path to success always involves making smart decisions. For those of you toying with the idea of becoming an entrepreneur, here are three common mistakes to avoid:

Hiring too many, too soon. For most startups, hiring employees before there is an absolute need can lead to disaster. Yes, delegation is an important part of being a leader, but before jumping into delegating, I encourage you to allow time for the startup dust to settle. Running lean early on requires you, as a founder, to wear many hats. While this may seem overwhelming, look at it this way: in addition to saving funds, you are spending valuable time becoming intimately familiar with the ins and outs of your business. Wait to hire until there is an absolute need; this will give you the hands-on experience necessary to build true domain expertise and therefore, the know-how to make important, informed decisions down the line.
Starting with an unidentified target market. While we would all like to build a product that suits everybody’s needs, doing so is next to impossible. It is crucial to identify your startup’s target market early on in the planning stages. Who will your customers be? If you put off determining your target market until after your launch, you risk being pulled in opposing directions by a wide range consumers groups who only like your product a little bit. To avoid this, spend time thinking about specifically who your product is built for — remembering to think beyond your own demographic. What gender? Age group? Profession? This thought process will help to focus your launch more narrowly on a group of consumers who you believe will be most enthusiastic about your product, and hopefully be willing to give you constructive feedback. Your true target market can only be dialed in overtime, but it helps to start somewhere.
People-pleasing. It is also important to have a firm understanding of your overall vision for your startup. You will receive invaluable feedback from consumers about what they like, what they dislike, and even suggestions for ways you can change and grow. Making changes to meet customer’s needs are crucial, but it is important to set a precedent for evaluating each change against your long-term vision. Will this change bring you closer to your end goal? Or will it drive temporary sales and lead you in the wrong direction? It can be tempting to make changes to ring in immediate sales, especially when budgets are tight, but I encourage you to evaluate the long-term impact.

Abbie Steinbacher is CEO and founder of the kids wellness company, My First Yoga. My First Yoga provides kids yoga outreach to schools and has a growing line of kids yoga products. Abbie and MyFirstYoga have been recognized in outlets such as The New York Times, BusinessWeek, Parenting Magazine, Parents Magazine, Yoga Journal and The Boston Globe. Abbie has a degree in Psychology from Harvard, and is a certified adult and children’s yoga instructor.

43 Troubling Facts About the Youth Unemployment Crisis

Scott Gerber — Tue, 15 May 2012 17:51:23 +0000

Placer Graduation 2008 © by Nick Ares (2008)

The class of 2012 is graduating from community colleges, four-year colleges and universities all across America this month. When they toss their caps in the air, I suggest you duck — because this graduating class has a lot to protest. While overall U.S. unemployment has dropped to about 8 percent — in part because many Americans have simply given up looking for work — recent college grads face a much more dismal reality: one out of every two was either jobless or underemployed in 2011.

To combat this epidemic, the Young Entrepreneur Council recently launched the national #FixYoungAmerica campaign. In April, we held a #FixYoungAmerica rally on 300+ college campuses in all 50 states, in which tens of thousands of students participated, and this week, we released #FixYoungAmerica: How to Rebuild Our Economy and Put Young Americans Back to Work (for Good) a book of essays written by nonprofit founders, educators, politicians and entrepreneurs who shared their own entrepreneurial solutions for ending the youth unemployment crisis in America. Unfortunately, throughout the campaign, what we’ve really uncovered is just how bad chronic unemployment really is for young people right now, including college grads. The fact is, young Americans need all the help they can get, and they need it now.

What’s the class of 2012 up against? Take a look for yourself:

1 out of 2 college grads — about 1.5 million, or about 53.6 percent, of bachelor’s degree holders age 25 or younger — were unemployed or underemployed in 2011.
Fewer than half of college grads from the class of 2008 to today found jobs within a year of graduation — down from 73 percent.
For high school grads (age 17-20), the unemployment rate was 31.1 percent from April 2011-March 2012; underemployment was 54 percent.
For young college grads (age 21-24), unemployment was 9.4 percent last year, while underemployment was 19.1 percent.
3 in 5 young college grads are unemployed or underemployed in the Mountain West region of the United States. The next-worst regions for being a young college grad looking for work? The Southeast and Pacific regions.
The share of employed young adults (aged 18-24) is at a 60-year low. It has dropped to 54.3 percent — the lowest level since government began tracking it in 1948.
The unemployment rate for young Americans under 25 is twice that of the general population.
Only 56 percent of American teenagers believe they’ll be as well off as their parents financially– a 37 percent drop since 2011.
Only 1 in 5 college grads thinks their generation will be more successful than the generations before them.
Only 18 percent of American teens say they’ll be financially independent when they turn 20 — compared to 44 percent in 2011.
The 15-percentage-point gap between young and working-age adults right now is the widest in recorded history.
While overall unemployment is around 8 percent, 29.1 percent of young male veterans and 36.1 percent of young female veterans age 18-24 were unemployed 2011—compared to 17.6 and 14.5 percent, respectively, of nonveteran young men and women.
Young American women still earn less than young American men, regardless of their educational background.
According to some researchers, up to 95 percent of job positions lost occurred in low-tech, middle-income jobs like bank tellers. Gains in jobs are going to workers at the top or the bottom, not in the middle.
More college graduates are getting low-level jobs, period. U.S. bachelor’s degree holders are more likely to wait tables, tend bar or become food-service helpers than to be employed as engineers, physicists, chemists or mathematicians combined — 100,000 versus 90,000.
More recent grads are working in administrative jobs than in all professional computer jobs out there — 163,000 versus 100,000.
More college grads are cashiers, retail clerks or customer representatives than engineers — 125,000 versus 80,000, to be exact.
Of young Americans aged 18-34, half have taken a job they didn’t want in order to pay bills.
Of young college graduates from the class of ’08 to today, four in 10 took jobs just to get by.
24 percent of young Americans aged 18 to 34 said they took an unpaid job for work experience.
According to new U.S. government projections, only three of the 30 occupations with the largest projected number of job openings in the next eight years will require a bachelor’s degree or higher. Most job openings by 2020 will be in low-wage professions like retail sales, fast food and truck driving.
More than 35 percent of young Americans went back to school because of the economy.
31 percent of young Americans postponed getting married or having a baby due to their financial situation.
Since 2006, 40 percent of college grads have put off major purchases like buying homes or cars.
One in four young Americans moved back in with their parents AFTER living on their own.
Median earnings for young African Americans are only 75 percent of the earnings of whites. For young Latinos, the number is even lower — 68 percent.
Between 2000 and 2011, the wages of young high school grads declined by 11.1 percent; of young college grads, 5.4 percent.
Almost half — 41.3 percent — of 25 to 34-year-old young Americans spend more than 30 percent of their income on rent every month.
The majority of recession-era college grads rely on financial help from their families.
Credit card debt has risen 81 percent among young Americans aged 25-34 since 1989.
The student loan default rate rose 31 percent over just two years.
Student loan debt is reaching debt-bubble proportions — it recently topped $1 trillion (and exceeds total credit card debt in the United States).
Two out of three college students now graduate with student loan debt. Average tuition is three times higher today than in 1980.
Average student loan debt is now more than $25,000.
African American students are more likely to take out student loans and graduate, on average, with higher levels of debt.
Federal student loan default rate is 8.8 percent and projected to rise.
Although 92 percent of young Americans aged 21-24 said they felt entrepreneurship education was vital given the realities of the new economy and job market, more than half (56 percent) were never offered entrepreneurship classes at all.*
Most — 62 percent — students who were offered entrepreneurship classes said they didn’t feel the classes prepared them enough to start a business.*
Of employed young Americans aged 18-34, less than half think they have the education and training they need to get ahead in their jobs today.
More than 53 percent of U.S. companies say they’re having trouble finding skilled non-managerial employees, in spite of the high number of unemployed Americans.
72 percent of youth said they do not feel they have enough support from banks, up from 65 percent in 2010.*
86 percent of recent grads feel they do not have enough support from the government (YEC/Buzz 2011).*
Finally, 52 percent of young Americans 18-29 feel the U.S. is headed in the wrong direction.

*Data is from the 2011 Youth Entrepreneurship Survey conducted by Buzz Marketing Group and the Young Entrepreneur Council (of young Americans ages 21-24).

Scott Gerber is a serial entrepreneur, internationally syndicated columnist and TV host, and the founder of the Young Entrepreneur Council. He is also an active angel investor and author of the book Never Get a “Real” Job.

The Business Lesson That Cost Me $30,000

Trevor Mauch — Tue, 15 May 2012 17:50:55 +0000

Money © by 401K (2011)

When I was first honing my chops as a young entrepreneur I heard a lot of advice—including the golden rule to outsource what I’m not good at. However, I was also told to never outsource marketing. At the time, I vowed that I’d never be “dumb” enough to hand off the lifeblood of one of my companies to someone on the outside. Why would I outsource my marketing? I loved it!

Over the next two years, my first company grew past $1 million in sales. I loved handling the marketing side; I did it well and I did a lot of it. But as my publishing business transitioned and my passions focused on launching a new software startup, I found myself juggling marketing responsibilities for two businesses. And if I didn’t design the campaigns, write the copy and manage the team to implement things, it didn’t get done and money didn’t come in. It was no one’s fault but my own—I made my team dependent on me.

Therefore, I made the decision to outsource my company’s marketing.

A friend referred a top-notch “hired gun” marketing consultant who had a proven track record of doing great things. We hit it off, and hired the outsourced team for a hefty monthly retainer. This team handled all marketing for my publishing company for the next six months, and they were pumping out things left and right. It was one of those moments where the clouds parted and angels started singing—I thought I’d found the answer!

But then a weird thing happened: our revenues actually dropped. More marketing campaigns were going out than ever, but nothing stuck. When we took a hard look at the situation—$30,000 later—we knew that something had to change.

The big lesson I learned from this mistake wasn’t the old and tired advice I heard early: “Don’t outsource your marketing.”

What I did learn was this: when establishing any kind of professional relationship, always do so with specific expectations, specific plans, and specific goals. Even more important, don’t be afraid to speak up when you have that gut feeling that things aren’t heading where you know they should.

The team we outsourced our marketing to was incredibly talented, and we’re still on good terms even if we’re not working together. But I admit that the sole reason for this $30,000 failure was that we didn’t set a “make or break” goal based on the needs of our company at that time. We didn’t stick to it until it became a reality. We didn’t pick a campaign and set it as a company priority; instead, we ended up running fast and in multiple directions. In the end, we didn’t get anywhere at all.

Now I know that marketing tasks can (and should) be outsourced to others, and we now have a stellar team in place who are doing better than we could have ever imagined. But as business owners, we need to be the ones who steer marketing efforts in the right direction. And ultimately, we’re also the ones accountable for the results. Therefore, we need to properly formulate a goal, hire the best people we can to carry out that vision, and maintain focus on the top priority of the company — every step of the way.

Trevor Mauch is the CEO of Automize, LLC and loves helping entrepreneurs regain time and profits by automating their digital marketing. But, above all he loves helping entrepreneurs regain the “lifestyle” part of being an entrepreneur so they can have fun in business and life again. Check out more on his personal blog.

15 Tips for Writing Your Company’s Mission Statement

The Young Entrepreneur Council (YEC) — Mon, 14 May 2012 11:30:29 +0000

Question: What is your #1 tip for writing a really powerful mission statement for your company?

Question by: Terry

Commit to Forward Thinking

"When writing a powerful mission statement for your company, think about statements that are applicable today and that will still be applicable to your company years from now. A powerful mission statement speaks volumes to the vision of the company. Your mission statement should be something that your company strives to do every single day, regardless of how big your company grows."

- Lauren Maillian Bias | Founder and CEO, Luxury Market Branding

Hedgehog Concept

"Reference the book Good To Great by Jim Collins. Answer these questions when you write your mission statement: What are you passionate about? What can you be best in the world at? What drives your economic engine?"

- Jay Khor | Managing Partner, Versutia_ LLC

Follow @jwkhor

Succinctness

"One sentence. Start with the word "To." Be straightforward and cut out every unnecessary word."

- Nicholas Tart | Founder, 14 Clicks

Follow @14clicksNick

A Noble Cause

"Build it around a noble cause, and have some metrics in the statement that show how you are going to achieve your mission."

- Aj Thomas | Founder & Executive Director, Infuse Entrepreneurship Foundation

Be Actionable

"It's great to say that you're going to be 'the best carpet company ever,' but that's not really measurable, or actionable. Instead, you can say you'll be 'the number one carpet company in sales in the Western United States.' It's clear, it's concise, and it gives you something to aim for (and reason to throw a party when you achieve it). Then, aim higher. There's power in achievability."

- Colin Wright | CEO, Exile Lifestyle

Follow @colinismyname

Mantra, Not Mission

"Let me borrow Guy Kawasaki's wisdom here: write a mantra, not mission statement. A mantra is three or four words long and its purpose is to help employees truly understand why the business exists. The ultimate test for a mantra is if your telephone operators can tell you what it is. If they can, then you’re onto something meaningful and memorable. If they can’t, then, well, it sucks."

- Devesh Dwivedi | CEO, Breaking The 9 To 5 Jail

Follow @Break9to55Jail

Model Your Company's Mission Statement

"If you want your company to be similar to Apple or Zappos, look at their mission statement and see how you can incorporate what they are doing into your company. Obviously, your statement will differ from these large organizations’ statements because you offer something different -- so be sure to convey that appropriately."

- Heather Huhman | Founder & President, Come Recommended

Follow @heatherhuhman

Be of Service

"When writing your mission statement, ask the question "How can I be of service with my product?" Once you figure out the answer, incorporate that into your mission statement and you will have a winner. The goal in writing a compelling mission statement is to think about what you can give, not what you can get. Write the mission statement separately, then the rest of the web site copy."

- Kris Ruby | President, Ruby Media Group

Follow @sparklingruby

Focus on Your Core Values

"Declare your reason for existence and your business purpose, then encapsulate the two by asserting the core values of your organization. Deliver on the principles and or beliefs that guide your work in the industry and help external stakeholders rally behind the "Why" instead of the "What.""

- Erica Nicole | Founder and CEO, YFS Magazine: Young, Fabulous & Self Employed

Think About the Product

"While you may have some idea for how you want to run your company, you also have to think about the impact your product will have on customers. How will it affect their lives, and how can you craft a mission statement to incorporate the product's impact on their lives? There needs to be some relation to what your mission is and what your product offers."

- Danny Wong | Co-Founder, Blank Label Group, Inc.

Start With the Audience

"Before writing a powerful mission statement, think about your intended audience. Too many mission statements are general and get lost in translation. By focusing your mission on the audience that will be most receptive to your company, it will be more effective in reaching them."

- Dan Schawbel | Founder, Millennial Branding

Follow @DanSchawbel

Get Emotional!

"I'm a big believer in making an emotional connection. If you get too formal with your writing, you establish more distance -- even a disconnect -- with your audience. I love that people feel the emotion that I exude in person through my writing. The response is always infinitely greater when you pour your heart into it, and people see that."

- Jennifer Kushell | Founder & President, Young & Successful Media

It's All About You

"Think about why you are excited about your company and what you hope to accomplish with it. Write it as a reminder to yourself rather than as a marketing tool."

- Alex Budak | Co-Founder, StartSomeGood

What Are You Really Doing?

"The reason most mission statements fail is because no one's entirely sure what the company really DOES. That sometimes happens, as it has in our case, because a business is small and growing. Take it as a warning sign that it's time to work on the business, not in it! Ultimately, if you don't know what you do, neither do your clients. And no amount of highfalutin wordplay is going to mask that."

- Lindsey Donner | Co-Founder and Copywriter, Well Versed Creative

Follow @lindsey_donner

Mission Statement?

"Who uses mission statements? If you’re a startup, get to ‘real’ work. If you’re thinking of a mission statement, you’re probably ready to hire an expensive agency to ideate this in a room full of beanbag chairs. "

- Ryan Holmes | CEO, HootSuite

Follow @invoker

How to Embrace Your Quirks (and Attract Better Clients)

Steph Auteri — Mon, 14 May 2012 11:00:40 +0000

Zooey Deschanel © by Genevieve (2012)

I’ve been writing about sex for almost as long as I’ve been having it, starting with a college internship at the Boston Phoenix in 2003 (I was a late bloomer). Back then, I didn’t expect to eventually settle into that niche so thoroughly. But here we are, nine years later, and I still write about sex for a living.

For the longest time, I operated as if my brand was split. When I first entered the professional realm, for example, I worked full-time at an academic book publisher. The sex writing, meanwhile, was a sorta-secret side hobby I did in my free time.

Then I went full-time freelance. I was able to devote more time to my writing, and editors were just begging for open and honest sex content that didn’t take itself too seriously. But when I decided to diversify and launch a career coaching company for publishing professionals, I struggled with how to create a cohesive platform.

“Does your sex writing turn off potential coaching clients?” people asked me. I told them I wouldn’t want to work with anyone who was turned off by that aspect of my life. I told them that most of my clients chose me because of my unconventional background. I even mentioned that sex writing and coaching had a lot in common, in that I used humor and honesty as a means of connecting with both my clients and my readers. All of this was true, but it was still tough to market those two sides of myself simultaneously.

Then I took a good, hard look at the mix of work I was doing and asked myself: How can I make my professional brand more integrated and awesome? I realized I would have to embrace my sex writing roots more fully.

I began scaling back on the time I spent marketing my coaching business, and started promoting myself as a ghostwriter, editor, and consultant to mental health professionals, activists and educators specializing in sexual health. I saw it as a way to continue doing the writing I enjoyed while still helping others. I even began writing a prescriptive memoir about being a sex writer with sexual dysfunction. Suddenly, things felt a lot less Jekyll and Hyde.

Basically, I used my more unconventional experience to set myself apart as a professional. You can (and should) do the same. It’ll give you that extra je ne sais quoi that will help you stand out from the other business owners in your niche. How?

The first thing you need to do is pinpoint what sets you apart from others in your field. So what makes you an original? If you’re not sure, ask yourself:

What do you love to do in your spare time? What would you spend your time doing if you didn’t have to worry about the bills?
What do you naturally do well?
What have been your greatest achievements? What heart-exploding accomplishment do you brag about the most?
What do you want to be remembered for?
What do other people consistently ask you for advice on?

Remember to ask other people where your strengths lie, too. You might be surprised by what others see in you.

Then, use this information to figure out a new way of describing yourself to others. For example, instead of introducing myself as a career consultant who sometimes writes about sex, I now present myself as someone who does content marketing and consulting for sexual health professionals.

Of course, it can be tough to draw a line between the personal and the professional when you’re using your personal life as a means of defining your career. So turn inward again and ask yourself: Who is my ideal client? Who do I want to be working with? What do I feel comfortable sharing with them?

Everyone who falls outside the vision of your ideal client — someone who doesn’t judge your hoop-dancing side hobby or your funeral-singing side gig but instead eats it up — well, they can go and hire that other copywriter/web developer/publicist/service provider. The one who’s nothing like you.

Steph Auteri is the founder of Word Nerd Pro, a one-stop word nerd shop offering a variety of writing, editing, and coaching services. She has been published in Playgirl, Time Out New York, Nerve, The Frisky, and other bastions of fine writing.

Can You Handle Working at a Startup?

The Young Entrepreneur Council (YEC) — Fri, 11 May 2012 11:30:51 +0000

Question: How can I determine if I have what it takes to work at a startup? What one quality do I need to have?

Question by: Rachel

Can You Roll With the Punches?

"Working at a startup means being comfortable with wearing many hats. Unlike bigger organizations, small companies require more flexibility and creativity. If you prefer to work in an environment where there are set positions and goals, then a larger company may be more appropriate. However, if you enjoy dynamic and constantly evolving experiences, then working at a startup could be a good fit!"

- Alexandra Mayzler | Founder and Director, Thinking Caps Tutoring

Follow @ThinkingCapsusa

Endless Motivation

"It's hard to constantly be motivated on what you're working on. Sometimes you just want to take a long break or work on something else temporarily, but it's crucial to stay motivated. The more persistent you are, the greater the chance of success for your startup."

- Ben Lang | Founder, EpicLaunch

Follow @entrepreneurpro

The Hunger to Learn

"If you are on your own, never stop learning. Use everything that happens to you as a learning experience. Use failure that occurs on your path to success as a case study to further improve your business. Continue to sharpen your skill sets and broaden your knowledge base. Never stop learning and never let someone tell you that something can’t be done or you can’t do it. Make things happen."

- Jay Khor | Managing Partner, Versutia_ LLC

Follow @jwkhor

Tolerance of Ambiguity

"When you're involved in starting a company, things change rapidly. What you're doing one day could be completely different the next. This is the biggest difference between startup and corporate culture. Expect to do things outside of your job description and move quickly."

- Nicholas Tart | Founder, 14 Clicks

Follow @14clicksNick

Love of the Circus

"A startup is like a traveling circus, where everyone has a specialty but everyone is also willing to do what needs to be done to get the show unloaded, running smoothly, and then packed up again at the end of the day. Being involved in a startup requires being equally willing to manage, code, consult or empty the trash cans. Be willing, and you'll be golden."

- Colin Wright | CEO, Exile Lifestyle

Follow @colinismyname

Where's Your Drive?

"To work at a startup, one needs to be driven, self-motivated and enthusiastic. This is something I state in all of my job descriptions (even for internships) because I believe each employee needs to have these qualities. It’s also important to have an entrepreneurial spirit and be an independent thinker -- these qualities get you far in the startup world!"

- Heather Huhman | Founder & President, Come Recommended

Follow @heatherhuhman

Ability to Get Things Done

"In a startup, the ability to get things done is the most important quality to have, often with a minimum of resources, funds, and limited information. Being able to push forward, make decisions independently, learn quickly from your mistakes and adapt to constantly changing circumstances and information are qualities that every CEO seeks out."

- Matt Mickiewicz | Co-Founder, Flippa

Follow @sitepointmatt

Incredible Patience

"Things take time. A lot of time. Regardless of how fast you move, your customers and partners aren't nearly as invested in the business as you are. It's important to push as hard as you can, but if you can't deal with waiting, entrepreneurship will be a frustrating experience."

- David Adelman | Founder and CEO, Reel Tributes

Unmatched Perseverance

"Perseverance is a word that summarizes exactly what it takes to be a startup entrepreneur. It means commitment to your company, hard work, patience, and having endurance. Startups are extremely hard and stressful, so if you don't have perseverance, it's going to be impossible for you to be successful."

- Dan Schawbel | Founder, Millennial Branding

Follow @DanSchawbel

Dedication Is Key

"Startup life is only for those with the right mixture of perseverance, initiative, resiliency, and vision. If you have a glamorized view that you’ll spend a few months building a website and then strike it rich, you’ll soon be handed a reality check. Be prepared for the fact that the hours are going to be long and your social life will be nonexistent for a while. Be ready to commit 100 percent."

- Robert Sofia | Co-Founder & COO, Platinum Advisor Marketing Strategies, LLC

Follow @robertsofia

True Grit

"You need to have passion. There is no specific DNA that makes up a specific role in a startup or to be an entrepreneur. If you’re passionate about what you’re doing, there shouldn’t be anything that can get in your way."

- Ryan Holmes | CEO, HootSuite

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Teamwork Is a Must

"Every successful entrepreneur requires the ability to be a team player. You cannot do everything on your own, so make sure you are willing to share tasks or take on someone else's project. It will help you get through the long hours, and when you hit a goal, you do it as a team."

- Bobby Emamian | CEO, Prolific Interactive

10 Different Definitions of Entrepreneurial Success

Kris Ruby — Fri, 11 May 2012 11:00:05 +0000

What does true entrepreneurial success look like? Is it by number of books sold, number of columns secured, number of press hits, number of blog subscribers, or revenue?

I asked ten rock star entrepreneurs: How have you defined your success as an entrepreneur so far? And what is your advice to others for defining their own success as an entrepreneur? Here’s what they shared with me.

“In our business, success is defined by action and innovation. We are a talent agency, so a lot of our success is contingent upon the success of the artists we represent. We try to not think about that and think more about how we can add value and forge artists’ careers forward. We have worked with everyone from the Black Eyed Peas to emerging talent. Some months, our success is based on the number of shows we serviced that month. Other months, it may be based on signing new acts we are excited about. Another month, month, success might be seeing a project we have been working on for a long time come to fruition or a big brand account. Advice to others: Be flexible. You may have to change directions to be successful, but don’t ever give up!”
– Alex Kirshbaum, President of NUE Agency, a talent agency focused on concerts, tours and endorsement deals globally with an emphasis on Tech and the “NUE” music business

“No matter how much money you make or how many things you have or if your business is worth millions or trillions — if you wake up in the morning and are happy with the person you are, if you believe you’re well-rounded by doing well (and your doing well by doing social good), then that defines success as an entrepreneur. The money will come. I will never let a number define who I am as an entrepreneur. Believing that success is based on a monetary figure is a small way of describing a big picture. Do well while doing good, and you can change the world while being a great entrepreneur. Don’t let some stat or ego-play dictate what you believe an entrepreneur is or is not.”
– Scott Gerber, serial entrepreneur, internationally syndicated columnist, TV host, founder of The Young Entrepreneur Council (YEC), active angel investor and author of the book Never Get a “Real” Job

“I wouldn’t say that I’m a successful entrepreneur at this point. I have an entrepreneurial mindset and a passion for entrepreneurship and have started companies, though I didn’t start Path (a simple way to share life privately with close family and friends). Books, columns and press hits are not the answer. Entrepreneurs build and start things, and how many times you can do that in your life is what defines success as an entrepreneur. One of the most important things you can do as an entrepreneur is to fail and fail often, but learn quickly and move on.”
– Matt Van Horn, Vice President of Business for Path

“I try not to define my success based on the amount I earn or anything like that. The coolness factor of the work I do matters a whole lot more. Entrepreneurs work longer and harder than anyone else, so you absolutely have to think what you’re doing every day is cool. Otherwise, what are you doing it for? ”
– Ryan Paugh, Community Director and Chief of Staff for The Young Entrepreneur Council (YEC)

“Success can be determined by accomplishing milestones and goals for your business. What may seem to be the smallest of goals may be the largest accomplishment for an entrepreneur. A true entrepreneur won’t be simply satisfied by accomplishing just one goal. They’re typically tempted to continue to raise the bar and reach new goals. Revenue milestones are obvious indicators of success, but also reach and visibility are just as important. My advice for others defining success as an entrepreneur is to set realistic goals, and don’t be concerned with how big or small they are. Just stay focused and love the journey.”
– Jordan Edelson, CEO of Appetizer Mobile LLC, a mobile development application platform and consulting company

“For me, defining my success has been about what I have been able to create out of nothing and how far I have come. Each year, I look back and assess what I have been able to accomplish in the previous year. I continually set goals for my business and celebrate each milestone as a sign of where the business is going. It’s tempting to just define success by the revenue you are bringing in, but I would advise entrepreneurs in the startup phase not to make that your only barometer for success. Of course, increasing revenue is a great sign of success, but also make sure to take pride in the fact that you are succeeding in doing something you love and that brings value to others.”
– Marni Galison, founder and CEO of Sunday at Noon, a personalized matchmaking and event company in Manhattan, New York

“I won’t lie, revenue isn’t bad, but I could make money in a lot of different fields by working for other people. For me, it’s the freedom to make enough money for a good life and the freedom to make a schedule that lets me be a good mom!”
– Bryce Gruber, founder of TheLuxurySpot.com, and principal at IntenCity Global

“Success means different things to different people. For some people, it’s about controlling their time. For others, it’s about money. For me, I know I am headed in the right direction when I get feedback from all over the world about what I’m doing for women. As time goes on, I am sure the definition of success will change for me. That’s just the life of an entrepreneur.”
– Amy Palmer, Emmy-Nominated Entertainment Correspondent, Executive Producer, CEO & Founder of PowerwomenTV

“For me, success is defined by the ability to make a difference in the lives of others, and make a living. The exchange of value between my clients and myself helps us both, and that is how I define my success. My advice to other entrepreneurs for defining your success: if it keeps you up at night or wakes you up in a cold sweat, you’re on the right track.”
– Nick Nanton, Esq., Emmy Award-Winning Director and Producer, also known as The Celebrity Lawyer and Agent to top celebrity experts

“My definition of success is constantly changing and evolving. I care more about making meaning than making money, so that’s a huge benchmark. I’m really proud of building She Takes on the World to inspire entrepreneurial women worldwide, and I’m excited to be leading a council of the world’s most successful young women entrepreneurs as Co-Founder of YEC Women. Winning an Emmy Award has also been a huge highlight of my career so far too, and it’s proof that it doesn’t matter how young you are — the sky truly is the limit.”
– Natalie MacNeil, Emmy Award-winning digital media entrepreneur and Founder & Editor-in-Chief of She Takes on the World, a leading blog for women in business

Kris Ruby is the President and Founder of Ruby Media Group LLC, founded with the goal of opening the vast potential of Social Media on the web to companies wishing to build relationships, grow and profit from Web 2.0.

Cash Flow Really Is King: I Learned the Hard Way

Justin Beegel — Thu, 10 May 2012 11:00:44 +0000

At 23 years old, I started Infographic World, a data visualization company working with brands to tell their story in a more visual and effective manner. It doesn’t matter that I’ve practically studied business since childhood or that I have an MBA—there is simply no greater teacher than failure. I’ve had to acknowledge this truth more times than I can count.

My first lesson came about 10 months into starting the company. At the time, I had virtually no systems in place to track money: how much was coming in, how much a job would cost, how much I would eventually need to pay vendors, etc.

More importantly, I never stopped to think about the payment terms I was offering my clients. In my head, I had been conducting a fair amount of business, so the money would come in whenever it came in, and I would be fine as long as there was a nice, comfortable amount of money sitting in the business bank account. To make matters worse, I always wanted to pay my vendors, so whenever I received an invoice, I would cut a check immediately, every time.

On a particularly fateful Friday, I was printing out the invoices that were in my inbox. For some reason, a lot of my jobs had come to a conclusion around the same time, which meant that there were now a lot of contractors that needed to get paid. I laid out all of the invoices on my desk, added them all up and wrote down the total number. Just before I began writing out the checks, I randomly figured that I should check my bank account balance and see what I’d be left with after paying these vendors on time, like I always did.

The next moment was one of the worst feelings I’ve ever had in my life—my bank balance wasn’t enough to cover the amount I had promised my vendors. It wasn’t even close, actually.

I closed the office door and sat there at my desk with a pain in my stomach that completely overwhelmed me. For the first time in my life, I felt like a complete and utter failure. How could I have been so stupid to allow a situation to arise where I had to pay out more money than I actually had in my bank account? I didn’t want to upset my vendors; they were the lifeblood of my company in terms of producing something for my clients. In my head, my business wasn’t going to survive the next 30 days.

I decided to visit my parents’ house that weekend and speak with my father, who has always been a mentor of mine and someone in whom I confided in times of trouble. I explained my situation and we sat there for hours, discussing what caused the problem and different ways to remedy it in the future.

With a hard look, I realized that my first problem was obvious: I wasn’t enforcing any sort of payment terms with my clients, and I was paying my vendors too quickly. Essentially I was paying for jobs long before I was actually being paid for them—a model that will eventually catch up with you, as I’ve learned. I proceeded to set up new terms both for the clients and the vendors: I began to require a certain percentage of money up front from the client, and also came to an agreement with vendors to pay them in a manner that’s more realistic for me as a business owner.

In order to enforce these new policies and prevent myself from making such a great mistake again, I found that I also needed a better way to track what money was going in and out of my company. My father insisted that I set up a “reserves” bank account for my business: whenever money was received for a job, I would set aside what I knew to be the future costs of this job into this separate bank account. This way, regardless of when the job got done, the money that would be needed to eventually pay the vendor would always be there.

This truly was my great mistake, but what matters is surviving it — and learning from the experience.

Justin Beegel is the founder of Infographic World, Inc. He left the big corporate world at 23 to help companies transform the way they communicate their messages—essentially taking things people don’t want to read (long and boring PDFs, text-heavy articles and dense subject matter) and turning them into captivating visualizations that people actually want to read.

12 Tasks Busy Entrepreneurs Can Outsource Now

The Young Entrepreneur Council (YEC) — Wed, 09 May 2012 11:30:35 +0000

Question: What odd jobs have you outsourced in order to increase your company's overall productivity?

Question by: Thomas

Mail Call!

"Packing up a product and mailing it at the post office is ridiculously time consuming, especially when the package is going overseas (visa forms are no fun). I just pay an outsourced temp on TaskRabbit $10/hour to buy my envelopes and boxes, package up my products, and mail them at the post office. This saves me a dozen hours at least each week."

- Eric Bahn | Founder, Beat The GMAT

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Video Transcriptions

"When I first decided I wanted to start providing text transcriptions of my video interviews with entrepreneurs, I transcribed them myself. After a few interviews, I realized I could pay somebody to do it much quicker. This allowed me to devote my time to tasks I was quicker and better at."

- Tim Jahn | Co-Founder, Entrepreneurs Unpluggd

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Payroll Slows Productivity

"I outsourced payroll with my first company when I hired my third employee. Payroll is time-intensive, and keeping track of deductions, liabilities and tax payments can get cumbersome. Outsource payroll to a trusted automated service and you will gain hours of productivity each pay period."

- Lauren Maillian Bias | Founder and CEO, Luxury Market Branding

Let Others Do the Data Mining

"Mining data for market research, PR, or sales purposes is one of the most important and most tedious tasks you will encounter. Always outsource tedious tasks, and focus on the creative projects and implementation side of your business."

- Brenton Gieser | Co-Founder , JoynIn

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Ship Out Logisitics

"After packaging tons of shirts ourselves in FedEx boxes and carrying them in suitcases and backpacks to the FedEx office, we realized we just didn't want to do it anymore. So, we started paying some of our best friends to do it, which turned out to be the least fulfilling job they had ever done. Finally, we decided to partner with a logistics company who handles all our shipping and handling."

- Danny Wong | Co-Founder, Blank Label Group, Inc.

Dry Cleaning and Laundromat

"As an entrepreneur juggling hundreds of tasks and responsibilities, it is essential to know where your time is best utilized. Running to the dry cleaners is time-consuming, and frankly, that time should be used where you are most valuable. I've therefore outsourced those tasks -- so should you."

- Zach Cutler | Founder and CEO, Cutler Group

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Trade Show Marketing

"At trade shows you shouldn't be at your own booth; you should be at everyone else's booth, making relationships. I have outsourced "bodies" at several trade shows to man the booth, give the pitch and sign people up. Meanwhile, my time is freed up to make contacts and drive new business."

- Lucas Sommer | Founder CEO, Audimated

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Dancing on Cue, If Necessary!

"The craziest thing I've ever had my assistant do is dance during a photo shoot! I was getting new pictures taken and the photographer wanted me to dance to capture more movement and energy. I felt too silly and self-concious dancing alone, so I asked her to stand behind the photographer and dance along with me! It worked and we got some great shots."

- Laura Roeder | Founder, LKR

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New Ideas, When You Run Out

"When HootSuite first came to fruition, it was named BrightKit. This didn’t fit with our brand, so we offered a $500 reward and crowdsourced the name. BrightKit was transformed into HootSuite."

- Ryan Holmes | CEO, HootSuite

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Virtual Assistants for Any Task?

"One of our franchise owners actually outsourced his online dating so that he could focus on his company's productivity. He hired a virtual assistant to act as himself by going online and setting up dates via the internet. The owner would then attend the dates, but he was able to avoid the time and effort spent leading up to the date online. He rewarded the virtual assistant with bonuses."

- Nick Friedman | President, College Hunks Hauling Junk

Security Stays Out

"I used to hire only in-house security guards for my bars, but the tedious search for the right guards and lengthy training process would cause nights where we were understaffed. Also, in-house guards were almost impossible to insure for assault and battery, so we outsourced to a security company to supply the guards, saving me a ton across the board."

- Michael Sinensky | Owner, Village Pourhouse

Outsource Everything!

"Well, not literally. But a smart and busy business owner who truly values their time should outsource as much as possible. Don't drive a package to the post office, don't build your own table from IKEA, don't take on responsibilities of payroll and HR, and don't try to learn how to make a website and do it yourself. Value your time, and find where your contribution has the highest ROI."

- Ilya Pozin | Founder, Ciplex