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Linchpins, Part I: Turn Business on Its Head

April 21st, 2011 ::

These inspirational tales are plucked from a Seth Godin ebook that I downloaded late last year, Insubordinate: Linchpins Everywhere You Look, Vol. 1 (the book cover for Linchpin is to the left–different book!).

If you’re not familiar with the term linchpins, Seth defines them as the people who make a difference, who ship, who do, who disrupt—in a good way.  Here are three of them:

David Seuss

Seth’s first boss was David Seuss at Spinnaker Software, the company that created the first generation of educational computer games.

David was a linchpin because he was driven by apparent risk, which, as Seth explains, is “when you launch stuff quickly, challenge the status quo, play with packaging or pricing or distribution, and do it with abandon.  It’s not actual risk, because in a fast-moving market, the risky thing to do is to play it safe.”

Because they didn’t play it safe, Spinnaker made a lot of mistakes, but they were also very successful and were constantly moving forward at a hundred miles an hour.  VCs and Harvard invested $10 million in Spinnaker Software.

The takeaway: As Seth asks, if you were a VC, would you have invested in David, who was always pushing to ship, or “a calm, polite, spreadsheet-following, numbers-cruncher?”

Steve Dennis

Seth’s first business partner was Steve.  They were unintentional business partners, because the tiny—and failing—college student-run business that hired them couldn’t decide if they liked Steve or Seth better, so they hired both.

Steve was not a risk-taker, but he knew “how to balance the facts and figures of reality with the upsides and options of dreams.” They ended up launching a new business every 10 days; at one point, they employed about 10 percent of the student body.

The takeaway: Don’t do what most people do, which is to use facts and numbers to create and amplify fear.  Turn it around and use facts to make dreams happen.

Lisa Gansky

How’s this for an impressive resume: Along with Tim O’Reilly and Dale Dougherty, Lisa Gansky co-developed the first commercial website (GNN), acquired one of the first search engines (Webcrawler), and then helped sell both to AOL back in that company’s heyday.

There’s more, but what is really impressive about Lisa, in Seth’s view, is that she so thoroughly “understands the power of connection and leadership and humanity.” During what was supposed to be a 30-minute meeting to discuss working together on a promotion, Seth and Lisa ended up spending four hours planning the first million-dollar promotion on the internet (this was in 1996 or 1997).  It was a huge success.

The takeaway: Instead of treating the meeting like one more sales call, Lisa used the meeting to produce something remarkable.

“What happens when you do that over and over again?” Seth asks.

“What will you do during your next sales call?”

Image Courtesy: Seth Godin

Preparing for the New 1099 Requirements for B2B Transactions

July 30th, 2010 ::

If you are in business for yourself it is safe to say that you probably utilize sub-contractors for your own business or for a client project. In the past it was pretty straightforward – if the person was not a corporation, they were a 1099 contractor. Company to company or B2B transactions were filed with the IRS through an I-9 form but that was pretty much it.

New regulations (don’t you just love them?) have mandated that all B2B transaction must be filed with a 1099 form. Section 9006 of the massive Patient Protection and Affordable Health Care Act will mean yet another huge paperwork burden for your small business. I wanted to thank Bobbie Lee who wrote this great article on Entrepreneur.com on the details buried in the new Healthcare legislation.

Here are some excerpts:

“Beginning in 2012, all businesses will be required to prepare 1099s for all services and goods purchased from all vendors in excess of $600. Current law dictates that only services provided in excess of $600 must be reported via form 1099 and that corporations (with the exception of attorneys) are exempt from receiving 1099s.”

“Beginning in 2012, corporations will no longer be exempt, and purchases of goods must also be included. The passing of this legislation is an attempt by the government to close the $300 billion tax gap, which will help pay for health-care reform. So I guess it indirectly relates to the Patient Protection and Affordable Health Care Act in which it was included.”

Depending on the industry, many businesses must collect, report and pay over a variety of excise taxes, as well. How much does all that cost your business in bookkeeping and payroll preparation fees? Now business owners must report all business-to-business transactions. So purchases your business makes from Staples, Office Depot and other vendors are included as reportable transactions.”

To read the full article with more details on the impact on small business, check out http://www.entrepreneur.com/money/taxcenter/taxpertisecolumnistbonnielee/article207404.html

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New Kinds of Shared Office Space

July 28th, 2010 ::

As someone who has had office space in all shapes and sizes there are a few things I have learned over the years:

  • Stay flexible because you can grow out the space (that is a good thing)
  • Don’t get space based on filling it at some point in the future (not a good thing)
  • Having a fussball tables does not mean your company is hip and cool (you decide)

In the past I have been in five year leases which are great if you are an established company that understands its needs. But if you are a new company or a rapidly growing company, staying nimble is essential to growing your business. For years the concept of the “Executive Suite” was a shared office space that you paid for to get a receptionist, a conference room and a professional presence to meet with clients. It is expensive and for many small businesses that are virtual, mobile and cost conscious, not an option. Those who know me know that I am a big fan of coworking. Coworking is were people pay a membership based on usage from walk-ins to full time tenants. It creates a very flexible and collaborative space but can be noisy or problematic if you have security needs (document storage, locking an office).

One other concept in between has been the office incubator that is for new companies to grow and hopefully graduate a program to go into a regular office space. While that may work for tech companies, many other business models, like retail have been at a disadvantage.

Recently, I came across this article in Entrepreneur magazine on this company called POOL Together that is a combination of a marketplace and business incubator. Here is an excerpt on the concept:

Brad Weinstock got the inspiration for POOL Together–a combination marketplace/small-business incubator–from other popular public markets and shared workspaces such as the Embarcadero in San Francisco, the Brewery in Los Angeles, and Pike Place Market in Seattle.

At its core, POOL Together is a business incubator. It offers local entrepreneurs affordable leases in a shared commercial space, and its owners provide assistance with business planning, marketing, space customization and cross-pollination as part of a comprehensive lease agreement.

You should start to see similar things like this in a city near you and if you haven’t this might be a whole new way to expanding your business. By owning the space and creating a community of small businesses around you.

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Tweetchat Recap on Blogging Effectively to Market Your Small Business

July 7th, 2010 ::

Shashi Bellamkonda wrote this great recap on the Tweetchat held on June 24th where the topic was about blogging effectively to market your small business. It is over at Small Business Trends but here are a few highlights:

  • When thinking about blogging, companies should think about goals first. What info you want to share and who will blog?
    • Content creation  -getting in habit of looking at daily business from blogging perspective (@eyeinfo)
  • Reasons to blog: Thought leadership, education, seo, branding, customer service and event promo
    • The blog is the hub or center of your business community, usually. Another key reason to maintain a blog w/social links (@CreativeSage)
  • Should SEO be a top consideration when starting a Blog?
    • SEO is a great goal but for a business blog, I feel that producing content that is useful to the reader is most important (@bethschillaci)
    • SEO should be a constant consideration for your blog, but content is always King. SEO is a tool.

Go to the full article to check out the whole recap.

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Sweat Equity and Broke

June 30th, 2010 ::

Over the last 10 years as an entrepreneur I have taken many risks and some have panned out and well others…let’s just say that I should have looked before I leaped. Then again, that is one of the truest traits of an entrepreneur, taking risk and making something from nothing.

Recently, I was reading an article called “The Sweat Equity Myth” by George Cloutier, Founder of American Management Systems. In his article he talks about the concept of “sweat equity”:

“The idea that business owners shouldn’t pay themselves a salary while they’re building a business. I call it working for nothing and being a fool.”

I couldn’t agree more with him, because I have done it and it was one of the worst things I ever did. When I started my first business, things were great and we had tons of clients. Sure it was the dotcom boom but we thought it was a whole new world. So when the sky fell and the bubble burst, many clients went out of business so we had to tighten the belt. Instead of swallowing my pride and lay people off I sacrificed my own salary and cut it in half as a message of solidarity, or so I rationalized to myself.

He goes on to mention something that I should have noticed early on, but didn’t:

“The inability to pay yourself is symptomatic of a much deeper financial problem; it’s should serve as a red flag that your business is not working. Lack of sales or quality control, bloated overhead and other financial woes are the real reasons you’re not making a salary.”

When 9/11 happened the clients we did have froze their contracts and put any new business in pipeline on hold for six months or more. My business, like many others, had a “deer in the headlights” look and many collapsed quickly. We did have some cash reserves so we had to make a decision, go on and try our luck or shut almost everything down to fight another day. We chose the later but paying everyone’s severance left me with nothing and extra debt to boot.

Over time, I did recover from that but in another business made the same mistake thinking that it was noble of me to sacrifice my sweat for equity I already had in the first place. Bottom line: Pay yourself first.

I would like to expand on that by including George’s tip to avoid this easy entrepreneurial trap:

  • Always work to make a good salary. Then cover the expenses. Not the other way around.
  • Reward yourself (but within reason). Here’s a rough formula: Pay yourself 3 to 4 cents on each dollar of revenue for doing the job of CEO.
  • Imagine you weren’t in the picture. Ask yourself how much you’d pay a general manager to run your business if you had to go away. That’s the least you should be paying yourself.
  • Remember your priorities. Don’t lose sight of why you’re running a business in the first place–to improve your quality of life.
  • Spread pay cuts around. Take a 5 percent cut along with the rest of your staff, but don’t put a 30 percent pay cut on your own back.
  • Ask yourself this question: If your business doesn’t allow you to pay yourself a living wage, what are you doing wrong?
  • Remember: There are no rich martyrs.

So what will you decide when this moment occurs in your entrepreneurial journey?

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Startup Fever with Six Million New Startups in the US in 2009

June 22nd, 2010 ::

Six million. Wow. I heard this on a Marketplace podcast (you should subscribe to it if you don’t) that talked about this report out today from the Kauffman Foundation. It it they stated that start-ups hit a 14-year high in the middle of last year.

That is a big number and they got their core data from self-employment stats the Census Bureau and the Labor Department publishes, and sure enough, 2009 was a stellar year. It revealed that more than half-a-million people started their own businesses each month. And that is up nearly 5 percent from the previous year.

This is one of those numbers that confirms two things – people start businesses in recessions and that the United States is a startup nation. Granted, this number was up due to higher unemployment but it shows us that when we are faced with a new challenging situation we won’t sit still. In fact, many new entrepreneurs I have talked to looked at their layoff with a severance package as the final kick in the pants they needed to start their business and achieve a life long dream.

One of the big trends in this report is that many of these people are part of the emerging Homepreneur trend which Emergent Research covered in a recent report. Even though they might be small, these small business are the engine of job growth in the United States.

Here are some highlights from the findings:

  • Groups ramping up startups include African Americans and folks 55-64.
  • Advantages include: cheap talent, cheap rent, reduced competition.
  • Failure rate stable as in other years: 50% in the first 5 years.
  • Small business credit cards cost more than before – a 14% increase vs. the consumer increase of 2.5%
  • Small business credit cards not protected by new consumer protection laws passed by Congress

I am excited to see more startups that have launched with no equity out the door, or by early revenue from solid deal flow that helps them grow organically. Since they have built their business in a tight credit market not getting capital has forced them to work with what they have instilling a discipline that will serve them well.

Thinking About Becoming an Entrepreneur or Taking Your Business to the Next Level?

We have two great resources you should check out – the Small Business Success Index and “The Rise of the Homepreneur“.

The Rise of the Homepreneur” which discusses the findings of the report “Homepreneurs: A Vital Economic Force” which is a new report published by Emergent Research, a small research and consulting shop in Lafayette, Calif. “We’re seeing more and more home-based businesses that are real businesses,” says Steve King, who coauthored the new report with Carolyn Ockels. To prepare the report, they analyzed U.S. Census data and Small Business Administration research, along with data from our very own Small Business Success Index, a survey of 1,500 companies sponsored by Network Solutions and the University of Maryland’s Robert H. Smith School of Business.

The Small Business Success Index™ (SBSI) is in its third wave of the report, sponsored by Network Solutions® and the Center for Excellence in Service at the University of Maryland’s Smith School of Business. To download a copy of the Small Business Success Index and also find out how your business scores on the six key dimensions of small business success, visit www.growsmartbusiness.com.

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Have You Made Your .CO Pitch? Deadline for the .CO PItch Contest is 6/14

June 10th, 2010 ::

So, have you pitched your idea for a new business, blog or website yet? The deadline is approaching and the contest winners will be announced soon. You still have time to get in your entry by June 14, 2010 and you could win $50,000 and the ideal .CO web address* to make it a reality.

Recently, we announced the global launch of the .CO domain and this .CO pitch contest.  As a quick refresher, the site Pitch.CO has a contest asking for your best business idea pitch and you can win $50,000. Here are the details:

Pitch it

Whether you’ve got a full plan ready to launch or just a few half-baked ideas drawn on the back of a napkin, it’s time to make your pitch! Clear your calendar for 30 minutes, get ready to focus and put your best pitch forward. Don’t worry about making it perfect – just have fun and make it happen. You’ll need the following details:

  • A 60-second video or an image that will inspire

    Nothing gets people inspired like hearing a great new idea directly from you.

  • A catchy title for your idea

    Half the battle in any contest is getting people to pay attention. How will you do it?

  • A little plan

    This is where the rubber meets the road. How does your idea come to life (in 1,000 characters or less)?

  • Your ideal .CO web address

    This is your chance to get the .CO web address you really want – choose wisely.

  • Tell us about you

    Charm the voters and judges with a little story about yourself and your background.

Promote It

Once you enter the contest, use our easy promotional tools to start marketing it everywhere. Share it with your friends, update your status, tweet about it, call your relatives, tell a stranger, whatever it takes to get people to vote for your entry on Pitch.co! The top 30 vote-getters will be advanced to the finals where they will join a maximum of 8 pitches selected by the judges. You can learn more about the great panel of .CO pitch judges on the .CO Pitch Site. Voting ends on June 14, 2010 at 11:59pm EST.

Win It

Grand Prize (1)

$25,000 in cash
$25,000 in web design/development services
1 ideal .CO web address to build it on*

Runner Ups (5)

$500 in cash
1 ideal .CO web address to build it on
*Subject to the .CO Launch and Registration Rules

Enter to Win!

So let’s get started! Go to http://pitch.co/submit or click on the button below. Good luck!

Disclaimer: Any .co domain including those mentioned in your contest entry may be registered by any member of the public after the sunrise period ending on June 10, 2010.

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Extend Your .COrporate Footprint with a .CO domain

June 3rd, 2010 ::

Many of us aspire to be entrepreneurs one day and many of you reading this may be just starting out or veterans at this already. What you all can agree on is that in order to take a company from small to big a critical element is extending its footprint and protecting its brand.

The Corporation Needs Its Brand Protected

We talked in a previous post about how a strong brand starts with a strong name. Of course, one of the first things you do when you start your business is to come up with a name. In the late 1990’s when the web was growing rapidly, people were adding a .com to the end of their company to show how forward thinking and hip it was because they got the “Internet thing”. Over time everyone expected you to have a .com for your top level domain (TLD) extension. However, over the last 15 years many of the .com addresses have been snatched up, there is a new opportunity on the horizon – the .CO domain.

We came across and interesting study on the .CO web site that talked about a study of 600 past and prospective domain registrants. It was performed by Penn, Schoen and Berland, a global market research firm, rand they learned that .CO domains in the second level are:

  • Easy to remember, simple to use, and easy to understand
  • More than 75% of respondents associated .CO with ‘company,’ ‘corporation,’ or other commercial endeavors—but .CO is not confined only to these meanings

Simply put, .CO is global, recognizable and credible, and therefore highly desirable in this competitive business environment.

Extend Your Corporate Footprint with a .CO Domain Name

While you might already have your .COM name secured, it important that you extend your corporate footprint to protect your brand and work well in a commercial or business environment. We have mentioned in previous posts that as you grow your company you will need to protect your name and multiple domain extensions is one primary way. It is important to note that as of this writing, if you have a corporate name/brand, the Global Sunrise is still going on but the window is closing fast. By June 10, 2010. During the Sunrise period holders of eligible registered trademarks have the right to apply for the .CO domain name corresponding with their trademark before the registration of domain names opens to the general public.

Take Your .COrporate Footprint from Small to Big with a .CO Domain Name

So are you ready to go from small to big? We encourage you to check out the Network Solutions .CO site more information about submitting your trademark application and the .CO domain name in general.

To support the launch of the .CO domain globally, the site Pitch.CO has a contest asking for your best business idea pitch and you can win $50,000. To find out more, check out the Pitch.CO site.

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Get Your Biz On! First Ever Women Grow Business Bootcamp this June in DC

May 21st, 2010 ::

I am happy to share the news that Shonali Burke, Editor of Women Grow Business has put together the first-ever Women Grow Business Boot Camp for women entrepreneurs in the DC metro area.

The goal according to Shonali is to “bring the smarts of our online community offline – to help you grow – or start – your business”.

Did you know that according to the U.S. Census Bureau’s last report (2006), the number of women-owned businesses in the U.S. grew 20 percent between 1997 and 2002. In fact:

  • Women owned nearly 30 percent of “nonfarm” businesses in the U.S.;
  • Fourteen percent of women-owned firms employed more than 7.1 million people; and
  • Wholesale and retail trade accounted for 38.3 percent of women-owned business revenue.

One thing’s for sure from this data: we women are bent on rocking business!

Event Details!!!

The first-ever Women Grow Business Boot Camp, which will be held from 8:30 a.m. – 12:30 p.m. on Saturday, June 19, in downtown DC.

If you’re a woman entrepreneur in the DC area (or want to be one), I hope you’ll attend this half-day, FREE workshop where you’ll hear from women business owners, many of whom contribute to and/or have supported Women Grow Business since its inception.

I mean, it’s not every day you get a chance to meet Kathy Korman Frey aka @ChiefHotMomma and our keynote speaker (W00T!), as well as powerhouses like Marissa LevinPatricia FrameShana Glickfield and many, many more.

What you’ll learn

Speakers will share their experiences in growing their businesses, and after the keynote, you’ll split into four breakout groups to learn more about four key areas of growing your business:

  • Money, Honey: the financial and infrastructural side to your business
  • Legal Eagle: the legal, IP and related issues we need to be aware of
  • What’s the Buzz?: marketing your business, including using PR and social media
  • Are You Being Served?: defining, reaching and retaining your ideal customer

We’re going to repeat these tracks after a short break, so that you can move to another group and learn about another area (and the speakers will change as well).

So by the end of the workshop, you should come away feeling empowered, armed with practical tips, and have done a ton of networking… at least, that’s what we hope you’ll come away with.

It’s on a Saturday, so hopefully that will make it easy for you to carve the time out of your busy schedules. And did I mention it’s FREE? Thank you, sponsors Network Solutions and the Intellectual Property Group and Diversity Committee of Steptoe & Johnson LLP.

Sign up!

You can register here, and do share the word with those you think would be interested… and maybe we can even come up with a flash mob of our own. Whadja say?

About Women Grow Business

Network Solutions-hosted blog community, Forbes named Women Grow Business one of the 20 Best Marketing and Social Media Blogs By Women earlier this year. Rather than rest on our laurels, we hope the Women Grow Business Bootcamp will provide a rich learning environment for women business owners… and those who want to join their ranks.

Small Business Use of Social Media up 200% since 2009 says, Small Biz Report.

May 7th, 2010 ::

Social media adoption by small businesses has doubled from 12 percent to 24 percent in the last year was one of the big take aways from the most recent edition of the Small Business Success Index™ (SBSI). This third wave of the report, sponsored by Network Solutions® and the Center for Excellence in Service at the University of Maryland’s Smith School of Business reports that small business are mainly using social media to identify and attract new customers.

Social Media is a Call to Action and not just a Buzzword

If you use social media in any way for your small business you are probably saying “heck yeah” to that confirmation which you have known about for a while. Many small businesses however have been starting to figure this out and in 2009 the buzzword was also a call to action.

The report quotes Connie Steele, Director at Network Solutions, “Tough market conditions mandate small businesses to think and act creatively to sustain themselves”. “Social media can be the best friend for small business owners who constantly seek new ways to attract new customers and retain the ones they have at a relatively low cost.”

Also from the report, the SBSI found that nearly one out of five small business owners are actively using social media in their business. Small businesses are increasingly investing in social media applications, including blogs, Facebook® and LinkedIn® profiles. The biggest expectation small business owners have from social media is expanding external marketing and engagement, including identifying and attracting new customers, building brand awareness and staying engaged with customers.  Sixty-one percent of the respondents indicated that they use social media to identify and attract new customers. Listen to a podcast on how small businesses are leveraging social media for customer engagement at http://bit.ly/JayEhret

Really Cool Statistics

Small business owners use social media to attract new customers:

  • 75% surveyed have a company page on a social networking site
  • 61% use social media for identifying and attracting new customers
  • 57% have built a network through a site like LinkedIn
  • 45% expect social media to be profitable in the next twelve months

Small business owners still have concerns with social media:

  • 50% of small business social media users say it takes more time than expected
  • 17% express that social media gives people a chance to criticize their business on the Internet
  • Only 6% feel that social media use has hurt the image of the business more than helped it

“Social media levels the playing field for small businesses by helping them deliver customer service,” says Janet Wagner, director of the Center for Excellence in Service at the University of Maryland’s Robert H. Smith School of Business. “Time spent on Twitter®, Facebook® and blogs is an investment in making it easier for small businesses to compete.”

People Are Getting More Creative

The main theme of this edition of the report is “Creativity as a strategy for success”. From the report, the executive summary mentions how “Small businesses are highly successful in getting referrals from existing customers, but struggle to be creative and differentiate themselves.” The major ways that small businesses differentiate themselves from competitors are:

  • Superior customer service (78 percent)
  • Higher quality products and services (76 percent)
  • Creative ideas to address customers’ needs (65 percent)
  • Lower prices (44 percent)

Among these four areas of differentiation, superior service and creativity are correlated with competitive success, while quality and low prices make little difference to small business success.   Perhaps everyone claims to have high quality, making it a marginal strategy for differentiation, while cutting prices is not sustainable for small enterprises that lack the economies of scale to keep costs low.

About the SBSI Report and Other Key Findings

In addition to tracking how small business owners use technology, the SBSI Index measures how they are doing in six key areas of business: capital access, marketing and innovation, workforce, customer service, computer technology and compliance.

Other key findings from the December 2009 Small Business Success Index include:

Small businesses experience positive effects from the economic downturn:

  • 72%  have found ways to operate more efficiently (up significantly from 66% in June)
  • 47% have been led to find new products and services that benefit customers
  • 43% have become better teams as hard times force people to work together

Building online presence continues to be key focus for small businesses:

  • Company Web sites are a top technology investment in the next two years, with small businesses either adding new features/functionality to their existing Web sites or building one from scratch.
  • The ability to showcase their products and services online to attract new customers is second in the hierarchy of technology investments small business owners plan to make in the next two years.
  • Social media investments rank third in small business investments to be made in the next two years.

Come On You Know You Are Dying to Read the Rest of It

To download a copy of the Small Business Success Index and also find out how your business scores on the six key dimensions of small business success, visit www.growsmartbusiness.com.

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