RSSAll Entries in the "StartupSmarts" Category

10 Mistakes Entrepreneurs Make With Investors

mistakes_unpreparedSeeking money for a start-up from friends, family, angel investors, venture capitalists or lenders is an exercise fraught with pitfalls. Many first-time entrepreneurs approach it with great optimism and belief in their business idea, only to fall flat on their face.

Reasons vary, but often it’s just that the entrepreneur hasn’t taken the time to study up on how to approach investors, including what to do and what not to do. The Young Entrepreneurs Council (YEC) – an invitation-only group of top young entrepreneurs – recently asked some of its most successful members to name the dumbest mistake they could think of that entrepreneurs should avoid when pitching investors.

[Follow Daniel Kehrer in Twitter]

Here’s our take on the top 10 mistakes they came up with (in no particular order):

1)    Making it all about the money: “When pitching an investor, you’re not just pitching your great idea. A relationship with an investor goes beyond the ROI and it’s important to focus on selling yourself as well as your business plan,” says Raul Pla, Founder & CEO of SimpleWifi.

2)    Being unprepared: This is an unforgivable sin. The entrepreneur, of all people, must have the details completely buttoned down. “Even if you get an investor interested, nothing will bring the conversation to a screeching halt quite like not knowing how much you want to raise and what you’ll do with it,” says Jason Evanish, co-Founder of Greenhorn Connect. You must show you can lead a business.

3)    Asking for an NDA (non-disclosure agreement): Only a rank amateur would do this. “Chances are, you’ll be laughed out of the meeting room if you ask investors to sign an NDA,” says Michael Tolkin, CEO of Merchant Exchange. “Ideas are cheap.”

4)    Being overly pushy: Investors accepted the meeting because they saw something in you or your business. But if you push too hard, most investors will shut down. “Be cool and confident, but not like a used car salesman,” says Ashley Bodi, co-Founder of Business Beware.

5)    Meeting your best prospects first: Keep this in mind, says Christopher Kelly, co-Founder of Convene: “Your pitch only gets better with time. You will achieve the best odds by saving the best for last.” Make a note of recurring questions and concerns after each pitch and revise your materials accordingly.

6)    Promising too much: “Go in with what you know, not what you think you can do. Investors will lose faith in you – that is, if they don’t see through you immediately,” says Jordan Guernsey, CEO of Molding Box.

7)    Rushing the pitch: “As nervous as you might be, try to calm down and speak from the heart,” says Logan Lenz, Founder of Endagon. “Speaking more slowly not only allows listeners to register what you’re saying, it also makes you sound more confident and knowledgeable.”

8)    Failing to leave time for Q&A: This is the flip side to #7 above.  You can’t take too much time and not allow questions at the end. “No matter how organized a pitch is, it will fail to answer questions your audience has,” says John Harthorne, Founder & CEO of MassChallenge.

9)    Making all projections and no plans: “Don’t put a hockey-stick graph in the middle of the presentation and expect everyone in the room to swoon,” warns Brent Beshore, CEO of Adventur.es. “Projections are guesses that rarely come true. What’s more impressive is your plan to get there. Investors know a strategy means a lot more than pretty pictures.”

10) Coming off as desperate: “People like to invest in and be connected to winning projects,” says Raoul David, CEO of Ascendant Group. If you come across as if this investment is the only way your business can move forward, it seems too needy and will turn off many investors. This also sets you up to be taken advantage of. “You’ll end up giving away more equity than you should.”

Copyright © 2000-2013 BizBest® Media Corp.  All Rights Reserved.

7 Cornerstones of Small Business Success

cornerstonesOnly about one of every 10 businesses started will reach a 10th anniversary and most failures happen within the first few years. Lots can go wrong: an ill-conceived business idea, poor planning or execution, bad business model, lack of capital, ineffective leadership, and poor location, among others.

But business owners who succeed know how to avoid the mistakes and pitfalls that trip up other entrepreneurs. They get the foundations right. Bill McBean is one such business owner. He grew a highly successful series of car dealerships in Texas and went on to write about his success in “The Facts of Business Life: What Every Successful Business Owners Knows that You Don’t” (Wiley 2012).

[Follow Daniel Kehrer in Twitter]

Here are McBean’s seven “tried and true” foundations for building business success:

1)    If you don’t lead, no one will follow. Good business leadership begins with defining the goals and direction of your company, and deciding how the business should look and operate. It also requires that you develop and constantly improve the skill sets you need to move your business forward. You must develop a company culture based on expectations and that rewards those who meet and exceed those expectations.

2)    If you don’t control it, you don’t own it. If you don’t control your business by defining key tasks and dictating how they must be handled, you don’t truly “own” the business. You’re more like a spectator watching others play with your money. “Great procedures and processes need controls, and these in turn create great employees,” says McBean. This happens because procedures and processes operate the business, and employees operate the processes.

3)    Protecting your business assets should be your first priority. Surprisingly to some, sales, profits and growth don’t come first. Assets – which include tangible and intangible assets – are what power sales, profits and growth, so they come first. And successful owners don’t stop at protecting obvious assets (with insurance, for example). They understand the importance of every asset, because those assets represent invested cash which should be managed to produce maximum profits.

4)    Planning is about preparing for the future, not predicting it. Effective planning is a mix of science (gather key information, for example) and art – taking that information and turning it into a plan that will move your business forward over a specified period of time. Nobody knows what tomorrow will bring. But you can make educated guesses with the right tools and effort.

5)    If you don’t market your business, you won’t have one. Some business owners believe their product or service will speak for itself. Others just aren’t savvy about advertising and marketing. But if people don’t know what you deliver, you can’t succeed.  New business owners tend to be especially nervous about spending scarce dollars on advertising. But without marketing, little good can happen. Look at it as an investment, rather than an expense that less successful competitors think it is.

6)    The marketplace is a minefield. Every company has competitors, and if you don’t now – and you are successful – you soon will. “To grow and succeed, you have to continually focus on the market, react to it and fight for what you believe should be yours,” says McBean. “If you don’t, your competitor will win the war.” You need to be cionstantly on your game and follow up your marketing efforts by capturing and retaining each customer your efforts attract.

7)    You don’t have to know the business you are in – but you have to know business.  Sure, you need to know the inner workings of your particular industry. But even more importantly, you need to understand at least something about general business fundamentals such as accounting, finance, business law and personnel, and how these impact each other and the decisions you make. You have to know what’s going on in your market, but it’s just as important to know how to translate that information into more sales and net profits. 

Copyright © 2000-2013 BizBest® Media Corp.  All Rights Reserved.

12 Tips for Naming a Business, Brand or Product

brand croppedWhen it comes to finding a great name for a business, brand, product or service, it really comes down to this:  A good name should make someone smile or nod, not scratch their head in confusion.

But this notion, mind you, is not universally held. Many businesses – and the branding agencies they hire to help them – have lately leaned toward combining letters and sounds into invented names that are hard to pronounce or understand.

Others prefer to aim for fresh, unexpected names that you don’t need a computer to decipher. One such advocate for fun and likable names and taglines is a San Francisco-based naming firm called Eat My Words (www.EatMyWords.com) that specializes in helping people who find themselves in a business or product-naming pickle.

Here are some naming tips from the pros at Eat My Words who come up with creative brand name suggestions and emotionally-driven company tag lines daily:

Naming a Business

1)    Don’t name your business after yourself. As tempting as that might be, the name is essentially meaningless to your future customers and evokes nothing about your business. What’s more, many names are hard to pronounce, spell or remember. One exception: If your name lends itself to clever word play such as a consultant named Steven Lord who call’s his business “Lord Knows.”

2)    Don’t date your business name. If you select something trendy or numerical (i.e. Women 2.0) the name might appear dated in a few years. Stick to names that can withstand the test of time.

3)    Use a name that will scale to fit future products. As Eat My Words notes, you don’t want to outgrow your business name. For example, if Amazon.com – which originally sold only books — had named itself Bookstore.com, they’d have painted themselves into a corner that would have made it difficult once they started selling anything and everything.

4)    Your name doesn’t have to convey trust and credibility.  That’s something you build through your logo design and marketing materials. If you try to build that into your name, you’ll likely end up with some hopelessly boring options.

Naming a Product

1)    Keep it simple and conceptual.  According to Eat My Words, basic yet powerful words make for the best product names. A few they’ve created include a travel make-up kit named Dash; an all-natural energy drink called Bloom; and a line of gourmet dips for kids called Monkey Dunks.

2)    Avoid acronyms. You should only expect people to remember one name, not two. Brand your product with a full name and let the acronym be something you only use internally.

3)    Name you product before your company. That’s not always possible, of course, but if people only remember one thing, it’s better they remember the name of the thing they will actually be buying (and searching for online).

4)    Select names that work as a family. Apple, for example, created a family of products that all fit together by using the same naming convention around “i” including iMac, iPod, iPhone, iTunes and iPad, among others.

Naming a Brand

1)    Define the personality of your brand in three words that will be your acid test. When Alexandra Watkins was naming her naming agency, she wanted to convey that the brand was “playful,” “creative” and “unexpected,” which lead her to Eat My Words. Something like ABC Name Bank simply wouldn’t have cut it.

2)    Your brand name should be spelled exactly how it sounds and be easy to pronounce. This certainly bucks a popular trend these days, but if you don’t follow this rule you’ll be constantly telling people how to spell or pronounce it. Your brand should be approachable – not something people struggle with and are embarrassed to try and pronounce.

3)    Choose a brand name that’s meaningful to your customers. Names with hidden meanings or foreign phrases can’t stand on their own, and you won’t always be there to explain. Each time you have to explain what your name means you are apologizing for it.

4)    The name should create a picture in the customer’s mind.  That’s because people remember pictures more easily than they remember words or letters.

Copyright © 2000-2013 BizBest® Media Corp.  All Rights Reserved.  Follow @140Main

The 8 Best Online Businesses to Start Now

Shoes.largeLooking to start a business? If you want something with big potential that doesn’t take much startup capital, consider an online service of some type. A major shift toward purchasing both consumer and business-to-business services online has created a slew of opportunities for would-be entrepreneurs.

For one thing, Internet usage continues to soar. Going online is now a reflex action rather than a conscious decision. Some people spend most of their day online, switching between their PC, mobile device, tablet and TV. Connection speeds have increased sharply and businesses as well as consumers are doing more and more things online.

Online Retail & Services Soar

According to a new study by the research firm IBIS World, the biggest money making opportunities are in the retail and service sectors. And here’s more good news: Many of the things once done only by the most tech savvy big businesses are now within range of small operators with little or no tech expertise. Basically, you can tap into whatever tech or expertise you need by using third-party vendors to develop websites, provide e-commerce capabilities and much more.

And the cost of Internet storage has never been cheaper. These factors and others have combined to make starting an online business easier, quicker and less costly than ever.

Here are eight types of high-potential businesses that are easy to get into and are experiencing major changes of the kind that spell big opportunities.

1. TV and Home Theater Installation

Few industries are as fragmented as this, or as easy to enter with little capital. Some 94% of U.S. households have a TV; 84% have a DVD player and about 25% now have a home theater. It’s now a $12 billion industry, although you’ll definitely need to keep up with fast changing technology.

2. Virtual Data Rooms

The VDR industry is growing quickly at about 16% annually since 2008, with revenue expected to reach $728 million in 2013. The proliferation of online document sharing services has helped the industry flourish. With low barriers to entry, IBIS World expects this industry to expand at an annualized rate of 17% over the next five years.

3. IT Security Consulting

This industry has benefited from increasing adoption of e-commerce, growth in mobile Internet access and some high-profile data breaches. Over the last five years, revenue increased at an annual rate of 9.8% to $5.3 billion. As businesses buy more and more computers and software, the need for IT security advice grows.

4. Travel Agencies

Outdated storefront travel agencies are giving way to online services, which offer a relatively high-profit, low-cost way to handle transactions. This segment of the industry has grown significantly and will likely continue to display strong growth during the next five years.

5. Online Shoe Sales

Consumers love buying things online – especially shoes, accessories and the like. Industry revenue has been growing at a robust 16% annual rate. Every year, more than 100 million Americans purchase goods online, one of the fastest-growing industries in the U.S.  Traditional brick-and-mortar retailers have an opportunity to enter the online realm and recapture sales taken by retailers that operate exclusively online.

6. Digital Forensic Services

This industry has also benefited from growth in mobile web connections and a rise in the percentage of households with at least one computer. The amount of information stored electronically is skyrocketing. Digital forensics helps find and analyze digital information for various legal purposes. While there are few prohibitive licensing or regulatory barriers, this business does require more capital than others.

7. Translation Services

Globalization and an increasing number of non-native English speakers in the U.S. have helped fuel growth here. The Internet has also fostered demand for translators because businesses expanding into new countries must adapt websites and marketing materials to the new region. Technology has helped automate some of the process, improving the speed and accuracy of translators.

8. Social Network Game Development

This industry has grown an astounding 184% per year during the past five years, driven by surging Internet and social network use. As smartphones and tablets proliferate, people can now access social networks anywhere, any time. Indeed, according to a report from research firm Nielsen, consumers spend 20% of their total time online using social networks on personal computers and 30% of their time online visiting social networks on mobile devices.

Copyright © 2000-2012 BizBest® Media Corp.  All Rights Reserved.  Follow @140Main

6 Lessons on Becoming a High Impact Business

High growth biz Uncle Sam wanted to know:  What kinds of companies are America’s true growth generators? Is it corporate giants like Apple, Amazon or GE? Is it startups? Is it relative newbies such as Facebook.

After some exhaustive research, the answer was clear: “None of the above.

As it turns out, the real economic spark plugs in the U.S. are not big public companies. They are small, privately-held, fast-growing firms that already exist. These “high-impact” businesses are defined as firms whose sales and employee count have at least doubled over a four-year period.

Surprise! High Impact Includes All Industries

That’s about 350,000 businesses and the research shows they tend to be a bit younger (but still average 17 years old) and a whole lot more productive than others.  And they’re not just a bunch of high tech firms, either. They exist in relatively equal shares across all industries – and get this – even declining and stagnant ones! No single industry dominates.

That alone is both positive news and a huge lesson for startup entrepreneurs and other business owners who fear they can’t hit it big in more traditional businesses or industries. In short, you can.

Here’s another stunning finding of the U.S. Small Business Administration study: This relatively small group (less than 10% of all U.S. companies) of privately-held small firms accounts for all (not most, but ALL) net job growth in the U.S. economy. And get this: These high-impact businesses are also largely immune to ups and downs of the business cycle. Sound good?

Small Firms Dominate

But surely these must be the “bigger” small business, right? Wrong again. The vast majority (94%) of high-impact businesses have just one to 19 employees. Another 5.5% come in at between 20 and 499 employees, and a scant 0.5% have more.

In other words, a few hundred thousand businesses with just a handful of employees are having a bigger collective impact on job growth in the U.S. than all the corporate giants combined. Now ain’t that somethin’!

By now, you should be saying to yourself you’re either one of these firms – or you want to be. But how? For answers, let’s check in with Edward Hess, professor and Executive-in-Residence at the University of Virginia’s graduate business school. Hess has studied high-impact businesses for years and has an insightful new book called Grow to Greatness: Smart Growth for Entrepreneurial Businesses (Stanford University Press, 2012). He offers these six lessons on being a high-growth firm:

1)    Don’t grow yourself into trouble

Many small businesses flame out when they try to grow too quickly, as growth outstrips people, processes and controls. Cash flow is critical. Growth requires investment ahead of cash receipts. “Entrepreneurs must understand they might not be able to afford all available growth,” says Darden. Avoid the “grow or die” myth. A better approach is “improve or die.”

2)    Upgrade continuously

Remember this: What got you here, won’t necessarily get you there. In other words, solutions that work at one size business generally won’t work as you get bigger. Growth means continuous change. Hess has found that common tipping points that require adjustments occur at 10, 25, 50 and 100 employees. Top entrepreneurs and their teams know how to experiment, learn and adapt.

3)    Know when to back off

All private businesses face the same growth challenges. The most successful ones know how to pace their growth. Hess calls it the “gas pedal” approach. They know when to let up on the growth gas pedal to give their people, processes and controls time to catch up.

4)    Manage your risks

Growth creates stress on finances, quality controls, people and processes. It can dilute your business’s culture and customer value proposition. And it can even thrust you into a different competitive space. Understanding these risks is crucial to managing your growth pace and preventing your business from being overwhelmed.

5)    Get better at delegating

In order for your business to grow, YOU must grow, too. There’s only so much you can do yourself. That means you have to evolve from being strictly a doer, to also being an effective manager, delegator and leader.  Sometimes that’s hard to do or swallow, but it’s a must.

6)    Keep strategic focus

Having and keeping strategic focus is also critical to growing “safely.” The most successful high-impact firms focus on doing one thing that lots of customers need, and doing it better than the competition.

Copyright © 2000-2012 BizBest® Media Corp.  All Rights Reserved.  Follow @140Main

Related BizBest Articles

A New National Network of Startup Communities

startupamericaWhen I first wrote about the non-profit Startup America Partnership in early 2011 (Why You Should Join Startup America), it had just launched with much fanfare and a lofty mission of helping to inspire and accelerate high-growth entrepreneurship in the U.S.  It was announced at the White House, although it’s not a government program and receives no government funding.

Back then, I said, “Any business owner or entrepreneur – from startup (newly created), to ramp-up (initial growth stage), to speedup (going like gang busters) – should be ready to tap this free resource when the help starts flowing.”

Well, the help is flowing freely and my original advice holds:  If you are in or around the startup space, getting involved with Startup America in your area will be well worth your while. (To join the network, go here and select your state or region.)

Startup America has quickly evolved from a kind of resources clearinghouse into a fast-growing national network of local and regional startup communities. Its leaders quickly recognized that to be effective at serving entrepreneurs who exist everywhere in different industries with wildly different needs, it had to do it region by region, state by state, city by city. Too many entrepreneurs are disconnected from each other; from their communities; from their towns, cities and states; from potential customers, funders and talent; and from the resources that could help them.

Building a National Network

Startup America aims to help by developing a national network of startup communities that include mentors, role models and fellow entrepreneurs who can sustain and validate each other. It is creating visible networks so that a startup in one city can be connected to other startups and leaders in that city, as well as to those in adjacent cities and to the entire country.

So far, Startup America has grown to nearly 12,000 members (you can view the member directory here).  Here’s an interesting breakdown of Startup America membership by state. Also check out dozens of helpful webinars available on the website.

California, which (as you might expect) has the largest member count of any state, is home to one of the most advanced regional initiatives and has a super-helpful website chock full of startup resources. These include places to find capital, mentors and crowd funding, among others.

(Note: BizBest’s Silicon Beach shortLIST has details on the startup community in Southern California, considered one of the fastest growing and most dynamic worldwide.)

State Experiences

Here’s what some of the regional Startup America leaders had to say recently about their unique startup environment, goals and challenges:

  • Florida is awash in high net worth capital, but the rich are not used to investing in startups. The state’s most talented entrepreneurs often leave for startup hubs in Boston, North Carolina, Austin, and Silicon Valley. There are 430,000 micro-businesses, with one to nine employees, which need help scaling.
  • Iowa said it had a good community of startups in IT, software, biosciences, and materials. The challenge was finding them all and getting them to venture out of their silos. There is enough venture capital money for rounds of $250,000 and up, but little for seed rounds of much less.
  •  Nebraska’s challenge was “to be identified by more people on a map.” It finds it hard to attract and retain talent, from developers to marketing and sales. It works closely with Iowa to create an easily identifiable Silicon Prairie region.
  • Texas has a lot of venture-ready money, but struggles to get it into the hands of entrepreneurs. The startup communities are based around cities—Austin, Dallas/Fort Worth, Houston, San Antonio, and El Paso—rather than statewide. Collaborating between these city-based communities is difficult.
  • Connecticut has money but no sense of a startup community. Everyone working to support startups is working separately. The state is attempting to create what it calls a “greased-skid system” of innovation clusters.
  • Massachusetts’ problem was “having too much” and getting the different organizations and people to collaborate. It wanted to expand the startup community beyond Boston to less-dynamic parts of the state and keep students in the state after graduating from Massachusetts’ many colleges.
  • Colorado’s plan was to use the success of its startup community in Boulder as a model for Fort Collins, Denver, and Colorado Springs, and to build deeper links between different industries.
  • Virginia said that it had very strong technology pockets, as well as some of the wealthiest and poorest parts of the country. The Defense Advanced Research Projects Agency (DARPA) spends a lot of its money in northern Virginia, but other parts of the state struggle economically. Many organizations claim to help entrepreneurs, but they are highly fragmented with no central authority. The main challenge was pulling together the various parts of Virginia into one startup community.
  • Maryland boasted of plenty of government support and interest in startups from the governor’s office down. The challenge was in catalyzing the state’s entrepreneurial spirit. A startup bus has driven around the state, inviting people to come aboard and pitch, garnering significant media attention.
  • Indiana called its startup community an “uprising.” In Indianapolis, there’s Developertown, raw office space where developers can build and park their own structures. What entrepreneurs needed was to be “less aw-shucks and modest.”

Copyright © 2000-2012 BizBest® Media Corp.  All Rights Reserved.  Follow @140Main

The BizBest Silicon Beach shortLIST

BizBest‘s Silicon Beach shortLIST™ is a vetted, hand-picked selection of key players, places, tech, events, organizations and other resources fueling L.A.’s Silicon Beach startup rocket ship.  Los Angeles is leading the nation in entrepreneurial activity, and the BizBest® Silicon Beach shortLIST offers an exclusive, independent playbook of Silicon Beach essentials.

Keep in mind, this is a subjective list, not an all-inclusive directory. We welcome suggestions and shortLIST nominations (via Comments, tweets to @140Main or email: editor at BizBest dot com). Tweet, like and share BizBest’s Silicon Beach shortLIST on LinkedIn, Facebook and other social media. Here’s an easy, sharing-friendly URL: shortLIST.la

ShortLIST members are listed by category, often alphabetically (but not necessarily):

Best Accelerators & Incubators

  • Amplify.la is a hands-on startup accelerator and multi-faceted entrepreneurial campus in Los Angeles.  Amplify helps startups grow in several ways, including seed funding of up to $50K, mentorship from a killer roster of specialists and connections to additional funding.  The Amplify program is four intensive months of collaborative curriculum designed to build a business from the ground up, and includes free workspace. Members also get free or discounted services such as legal, banking and web hosting. Download their one-sheet (PDF) here. Located on Main Street in Venice, the Amplify community is super passionate about learning, growing and inspiring. Follow this link to see a complete list of the accelerator’s partners, portfolio, staff, mentors and investors.
  • Cal-X Stars Business Accelerator, based in Santa Monica, was formed in 2012 by Howard Leonhardt, an inventor and serial entrepreneur who holds some 20 patents for treating heart disease. Leonhardt Ventures www.leonhardtventures.com is the main backer of Cal-X Stars portfolio companies, the Cal-X Stars Business Accelerator, and its partnered company The California Stock Xchange www.calstockexchange.com of smaller firms in early SEC registration process. BizBest note: Cal-X Stars has a unique model with both a 12-month accelerator (invests $18K min.) and a 5-year plan.
  • Founder Institute is an early-stage startup accelerator and global launch network, with a new LA chapter. Through a part-time four month program, existing and prospective founders can launch their dream company with expert training, feedback, and support from experienced startup CEOs – while not being required to quit their day job. A unique Graduate Liquidity Pool also lets graduates and mentors  share in the equity upside of each class.
  • Hub LA is a collaborative space for startups in downtown LA and caters to a more eclectic and artistic group than those on the Westside. The member mix at Hub LA includes social entrepreneurs, freelancers, artists, funders, students, mentors and community leaders. It offers members access to 4,000 square feet of creative industrial space to work, meet, learn, collaborate, and play. Offers ability to participate in social and cultural programming alongside business acceleration services, member-run events and workshops.
  • IdeaLab, based in Pasadena, is a bit of a hike from The Beach, but it’s one of LA’s entrepreneurial pioneers (founded in 1996) and continues to explore tech startup frontiers. Several IdeaLab startups are exploring new models for improving search and IdeaLab has also spawned companies with breakthrough technologies in robotics, renewable energy and automotive design. In addition to capital, IdeaLab provides a range of resources to help startups quickly introduce innovative products and services, including office space, technology, product and graphic design, marketing, financial advice, human resources, competitive research, legal, accounting and business development services.
  • k5 is a SoCal-based, tech-focused startup accelerator that was formed in 2011 by a group of successful investors and entrepreneurs with a passion for building startups. K5’s goal is to provide local entrepreneurs with a chance to work with SB investors, mentors and other  professionals. Offers up to $25K in pre-seed funding, along with work space, mentors, legal services, web design/hosting, investor access and other goodies. Works with ~20-30 teams yearly.
  • Launchpad.LA — a startup accelerator in Santa Monica — was founded as a mentorship organization in ’09 by Mark Suster with the goal of helping local entrepreneurs build relationships, get funded, and grow while remaining in Southern Cal. Launchpad LA offers each accepted company a $50K investment, four months of free office space and (probably most important) access to awesome mentors and investors. Hint: Deal terms may be flexible for startups that have already raised some capital.
  • Los Angeles Small Business Development Centers — which tend to fly under the typical startup’s radar — are a great Silicon Beach resource for entrepreneurs who plan to self-fund/bootstrap their own businesses and aren’t seeking angel or VC money.  One of the best parts about SBA-backed SBDCs is that they offer mostly FREE help for startups, available from 8 LA-area locations, often at a local community college campus (such as Santa Monica College).
  • MuckerLab, based in Santa Monica, calls itself a “mentorship-driven” accelerator focused on serving Internet software, services and media entrepreneurs in L.A. at the earliest stages of startup.  It offers a 3- to 6-month program that includes up to $21k in funding office space, access to top mentors, plus hands-on product, marketing, legal and fundraising support. Check out their portfolio companies and press coverage.
  • Science, Inc., based in Santa Monica and founded by former MySpace CEO Mike Jones, is an incubator that creates, scales and/or acquires digital businesses by bringing together talent, resources and financing through a centralized platform with A-list VC connections. BizBest tip: A key difference of the Science model is that there’s no set timeline for exists or releases. Science launched with about $10M of VC cash from the likes of Rustic Canyon, White Star Capital, Tomorrow Ventures, and others.
  • StartEngineLA is a Westwood-based “rapid accelerator” (not that the others take the slow path) with a $15M investment fund focused on helping LA-based tech startups build a solid foundation for success in 90 days flat.  Created by Howard Marks, co-founder of Activision, and Paul Kessler, a prolific investor, Start Engine offers local startups the essential resources and counsel they need to stand on their own, including up to $20K in seed money, introductions to top VCs and angels, along with office space, administrative and legal support. Here’s the process.
  • upStart.LA — which has joined forces with Santa Monica-based CrossCampus (see Best Co-Working/Startup Spaces, below) — is a mentorship-based startup accelerator for SoCal entrepreneurs (Dan Dato and Ronen Olshansky are co-founders of both entities).

Best Co-Working and other Startup Spaces

  • BlankSpaces, located in Mid-Wilshire, is a community of entrepreneurs, freelancers and startups, offering flexible office plans by the hour, day or month. Prides itself on being a place that fosters collaboration and camaraderie among members.  Their short videos/commercials get our nod for humor (we especially like the one titled “Screwed!”.
  • Coloft is a member-based community and work space in Santa Monica for startups, entrepreneurs, freelancers and other independents. Has meeting rooms and spaces available by the hour.
  • CoWorks, on 2nd Street in Santa Monica, offers open desks and private work spaces and is built around a concept of discovering inspiring companies and talented people with bright ideas. CoWorks welcome all industries and promotes networking via onsite events. Prices include access to all amenities such as meeting rooms, WiFi, network printer and events.
  • Cross Campus offers a variety of membership and startup space options at its 11,000 square foot facility in Santa Monica.  Its self-described goal is “to inspire creative collisions through space design, learning platforms, and extraordinary events, fostering member-driven collaboration that ultimately leads to game changing ideas and enterprises.” Works in tandem with upStartLA (see Best Accelerators, above).
  • io/LA is a place where startup entrepreneurs can work, collaborate, and socialize.  Offers entrepreneur-friendly month-to-month memberships and 24/7 entry to an expansive full-service work space. Based in Hollywood and heavily entertainment industry focused. There’s also a unique incubator program. Every three months, five startup companies are chosen by the founders via an online application process. These fledgling businesses move into the io/LA  incubator for an intensive 90-day program culminating in a “demo day” presentation to VCs, studio execs and/or producers.
  • Culver City-based NextSpace (from Liquidspace), offers both physical spaces and virtual services to freelancers, startup entrepreneurs and what they call “creative class professionals.”  BizBest note: The real-time calendar on their website is a nice feature for viewing available workspaces.
  • Real Office Centers (ROC), which snapped up the former Google space at 6th and Arizona in Santa Monica, has a killer location.  ROC is looking to duplicate its success with startup spaces in San Diego, Newport Beach and La Jolla with a new, ummm, “beachhead” in the heart of SB. The first floor is open — and looks great — but second and third floors are under renovation (those Google guys sure left a mess; and enough with the primary color thing!). Great space; but prepare for sticker shock on rates.
  • WeWork cut its startup teeth in New York City with some eight locations before heading to Silicon Beach (well, Hollywood anyway) after hearing where the real action is. WeWork members include everything from startups to established businesses in social media, tech, gaming, mobile apps, art, design, leadership, consulting, staffing, legal, fashion, health, beauty and music. BizBest Note: WeWork also offers access to health Insurance, discounted credit card processing rates and in-house food services.
  • Working Village, in Santa Monica, caters to micro businesses, freelancers, home office workers, entrepreneurs, startups, tech workers, writers, designers and other professionals. The twist here is an emphasis on services that emulate boutique hotel hospitality.
  • Satellite Santa Monica (Satellite Telework Centers’ 4th California location), on Main Street, is specifically tailored to the flexible workspace needs of the Silicon Beach film, TV and digital media community.  Has private offices, bungalows, meeting rooms, a screening room with 1080P HD projector, and editing bays with fiber connectivity.

Best Organizations, Support Groups, Events & Workshops

  • Angel Launch is a new brand created by iHollywood Forum which produces programs in Los Angeles and at trade shows such as NAB, CES, GDC, E3 EXPO, NATPE and CTIA.  Sessions address key topics facing startup entrepreneurs and include a panel discussion and networking dinner.  Startup Venture Summit is their newest conference, designed to connect entrepreneurs and investors across all sectors.
  • Caltech/MIT Enterprise Forum sponsors ongoing events intended to encourage the growth and success of tech-based entrepreneurial ventures in SoCal. Through its monthly programs, the Forum provides advice, support, education and networking opportunities for Silicon Beach tech startups. Programs address  financing, marketing, business plans, executive leadership and staffing. Popular case studies feature companies in emerging technology  reviewing their business plans.
  • DigitalLA is a must-know Beach player. Founder Kevin Winston has built what’s arguably the largest and certainly most dynamic networking organization in LA’s digital entertainment community.  In June 2012, DigitalLA launched the first Silicon Beach Fest (SBF) — a highly-successful festival and hackathon celebrating L.A.’s burgeoning Silicon Beach startup community. Winston followed up with an equally-successful Hollywood edition in November. The website is a goldmine of links and info — and lots of cool Silicon Beach Fest photos. Be sure to join the LinkedIn group!
  • General Assembly | Los Angeles — The new Santa Monica-based L.A. branch of General Assembly offer classes and events at the intersection of entrepreneurship, tech & design, including an introduction to Silicon Beach.
  • LA CEOs conducts regular meetings that bring together CEOs, founders, entrepreneurs, and mentors to help startups and growth companies accelerate their success. The group is hosted by Mark Landay, managing director of Dynamic Synergy Executive Recruitment (see below). BizBest note: Check the schedule on the site and sign up for the mailing list.
  • Lean Startup Machine | Lean LA is a three-day workshop where attendees use customer development and “lean startup” principles — basically the process Eric Ries defined as rapid, iterative prototyping and assumption testing to develop products and services that customers actually want. BizBest note: LSM conducts workshops worldwide; including Silicon Beach. Here’s a good description of how it works.
  • LAMCII (Los Angeles Mayor’s Council on Innovation and Industry) is backed by a broad range of Silicon Beach business leaders and was formed in 2012 to focus national and worldwide attention on LA’s thriving Silicon Beach “innovation economy” and to help facilitate community and government actions to drive entrepreneurship in LA.
  • Silicon Beach @ USC: USC’s vaunted Marshall School of Business held its first Silicon Beach @ USC event in September 2012, billed as “two days highlighting innovation, new ventures, partnerships and investment at the intersection of technology and digital content.” More to come.
  • SoCalBio Investor Conference is an annual event that showcases emerging LA-area biosciences firms and technologies looking for capital and seeking partnerships. Sponsored by the Southern California Biomedical Council.
  • Southern California Venture Network positions itself as an exclusive high-end business networking group that aims to increase the networking opportunities of startups and emerging growth companies by plugging them into SCVN’s professional and high-level business contacts. This is more of a “venture development” organization, helping companies between $1M and $25M with funding already in place to reach their next milestones through monthly events.
  • Startup Grind is a global group of “Grinders” with a 30-city event series that aims to educate, inspire and connect local startup entrepreneurs. While they’re rooted in that “other” Valley up north, there’s an LA chapter that holds monthly meet-ups (paid: $12-$22) where founders and investors tell their stories and hold chats.
  • Startups Uncensored — brainchild of entrepreneur-extraordinaire Jason Nazar — lays claim to being the longest running (since ’08) and most widely-attended SoCal tech gathering, regularly bringing together thousands of entrepreneurs, techies, investors and high-powered speakers. Topics have included online subscription businesses, startup success strategies, affiliate marketing, building great internet companies and working with investors. Get on their email list.
  • TCVN is tech business networking group, bringing together entrepreneurs, investors and other resources via forums, pitch sessions, workshops and other networking events. Tech Coast Venture Network has been around since 1984. Check out their upcoming events.
  • Technology Council of Southern California is a forum for Silicon Beach tech leaders, offering events, connections, information and resources to help tech companies succeed. Tech Council programs encourage interactive discussions between presenters and attendees, including two flagship events — VentureNet™ and the annual Industry Awards.
  • UCLA 48hr Start-up is an event that brings together people with technical, design and business backgrounds to share ideas, form teams, build products and launch startups (all this in less time than it takes to renew a license at the DMV!).

Top Angels, VCs & Other Investors

  • AngelVision Investors was launched in 2010 by a group of current and former LA-area entrepreneurs who’ve successfully created, owned, led, managed, built and sold companies in the entertainment, marketing and new media industries.
  • DFJ Frontier invests in seed and early-stage tech companies in Silicon Beach (and other parts of the West Coast).
  • Digital Coast Ventures is an affiliated investment vehicle of Santa Monica-based Montgomery & Co.
  • Greycroft Partners, with offices in both Santa Monica and New York, was formed in 2006 and is focused primarily on digital media companies. Portfolio companies benefit from active, hands-on assistance in all phases of expansion, including marketing, finance, and management development.
  • Harvard Business School Angels of Southern California is a young but growing group formed in 2011 and made up of Harvard alumni (not just b-school) interested in investing in early stage Silicon Beach companies.
  • Invent.vc makes claim to being the only publicly traded venture firm (stock symbol IDEA) focused exclusively on building startup web and mobile tech companies. Bryce Knight, CEO, aims to be a leading conduit between Silicon Beach startups and retail investors.  The Santa Monica-based firm was founded in 2010 as the Los Angeles Syndicate of Technology by a team with decades of experience managing startups, and the company employs its proprietary “Cofoundry” process to building web and mobile tech companies. INVENT acts as an institutional cofounder and plays a key role in creating/developing each startup.
  • LAVA: The Los Angeles Venture Association, a paid membership organization, has cred (or is that Kred?) as L.A.’s premier forum for entrepreneurs, venture capitalists, angel investors and professional startup advisors.
  • Maverick Angels, an angel investor group based in Agoura Hills, takes a decidedly hands-on approach to its investments, offering a range of coaching, training and relationship-building support to early-stage startups in its portfolio. Here’s where entrepreneurs can apply to present.
  • NALA Investments is an early stage media and technology fund based in Santa Monica founded by Emilio Diez Barroso to identify and manage investments for the Diez Barroso Azcarraga family. The Azcarraga family founded Televisa (NYSE: TV) and Univision, the two largest Spanish language media companies in the world. In addition to its media and entertainment ventures in Latin America, NALA invests in consumer internet companies at the seed and series A stage in Los Angeles and the Bay Area.
  • Originate is a software development firm that also invests in startups, albeit under a different kind of model.  For early stage startups, Originate invests capital as well as talent from its elite team of software engineers, designers and strategists. Its goals, however, are not unusual: It invests in solid teams, high-potential markets, unique ideas and interesting IP.
  • Rustic Canyon, one of the largest VC firms in L.A., actively invests in early-stage Silicon Beach startups.  RC likes themes that have a transformative impact across industries and sectors in digital media, ecommerce, consumer online services, SaaS and energy efficiency. Check out RC’s list of companies.
  • Siemer Ventures, based in Santa Monica, invests in both early-stage tech companies and consumer-facing businesses positioned for rapid growth. BizBest note:  Siemer shies away from pre-launch businesses. Initial investment size is typically $150K-$350K.
  • Tech Coast Angels: This active angel group has been around for years, and was one of the pioneers in putting Silicon Beach on the map.  With over 300 members and five regional networks across Southern California, TCA is also the largest angel investment group in the US. TCA typically gets about 600 funding applicants yearly, and invests in about 15-20 of them. In addition to money, TCA also supplies connections, knowledge, mentoring and help with operations. Check out TCA’s screening process.
  • The Brandt Organization, Inc. of California is a private investment vehicle that funds Silicon Beach startups.
  • Tomorrow Ventures has invested in several Silicon Beach startups and accelerators, including both Amplify.la and Science.
  • VioVoda (LA office in Glendale) is a tech acceleration fund focused on B2B startup companies.  VioVoda has a worldwide focus, not just Silicon Beach. The firm works with five angel networks in California to help syndicate rounds between $250k to $1.5 million. Has another US office in San Francisco, and a European office in Sofia.

Best News & Information Sources

  • BizBest Media (hey, that’s us!) lays claims to being an early Silicon Beach startup itself –  before the SB moniker existed. Nationally-recognized thought leaders in the startup, entrepreneurship and small business space. Published, syndicated and cited in major media nationwide, including The New York Times, MSNBC, Amex OPEN, MyVenturePad and many others.
  • Caypen Media publishes Caypen Magazine, a SoCal B2B publication that profiles startups, entrepreneurs and other innovators and carries articles by industry experts. Caypen’s monthly SoCal Business TIEs meetups bring together trendsetters, innovators, entrepreneurs and startups.
  • socalTECH.com is a news and information site covering high-tech companies in Southern Cal.  It has a great calendar of local events and a database of tech firms in the region. BizBest Note: Read ’em, or weep.
  • StartupDigest – recently acquired by StartupWeekend – publishes top-notch enewsletters (which to us means useful, actionable info) and event calenders for startup communities in multiple cities, including Los Angeles.  BizBest note: Signup, sign in and get the Los Angeles edition!
  • TechZulu is an independent, LA-based news group that specializes in showcasing tech industry people. A pioneer in live Web TV, TechZulu engages millions of viewers via real time reporting at conferences and its weekly news show, TechZulu Live. These hip folks also offer production services for conferences and events. Their excellent Spotlight Series highlighting promising new technologies is must viewing.
  • Ryan Born’s blog Entrepreneurial Ramblings offers insightful, well-written pieces on tech and entrepreneurship in general, as well as some great “insider” commentary on the Silicon Beach scene. In addition to being CEO at AudioMicro, Inc., Born is an angel investor and LAVA board member.
  • UCLA INVENTS is a monthly news bulletin highlighting innovation, entrepreneurship, and technology commercialization developments and opportunities at UCLA.

Best Startup Services

  • Dynamic Synergy Executive Recruitment, with outposts in both Santa Monica and Palo Alto, has long been a leader in sourcing talent for tech firms in LA, and has serious cred with the top VCs. Dynamic Synergy limits the number of searches it takes on so it can focus on delivering quality results. Here’s a partial client list.
  • Fetch Recruiting specializes in filing tech positions in a wide range of industries, and loves Silicon Beach startups (dogs, too, they say…hence the name).
  • Jim Jonassen & Associates / Venture Search (JJA Venture Search) is an A-list executive search and placement firm that cultivates a premier talent roster of leaders for West Coast tech and media companies, including many Silicon Beach firms. Based in the heart of Silicon Beach itself, JJA has more than 35 years in the industry and a track record of 98% successful completions for retained searches since 2001. Be sure to sign up for their “KillerOpps” e-mails with periodic updates on job searches, market intelligence and events.
  • talkTECH Communications is a technology-focused, marketing communications firm. They really know digital and social.

Best Backers of ‘Work-Hard/Play-Hard’ Thinking

  • Silicon Beach Fun is a brand-new and super-cool (not to mention free) app that helps you find places to play while working hard in and around Silicon Beach. We downloaded Silicon Beach Fun and were happy to see a robust and wide-ranging set of recommendations, including FUN bars, FUN hangouts, hotels, restaurants, places with Internet access, Silicon Beach Favorites and a Silicon Beach Index. Also has info on half-price tickets, Silicon Beach news and event listings.

Corporate Titans

  • Google Los Angeles: Sitting smack in the center of Silicon Beach (Venice) in its high-concept building and mini-campus, the company of primary colors hasn’t yet shown Beachers much green so far as we know, but says it aims to sponsor local events and perhaps strike partnerships with some SB tech startups.

Copyright © 2000-2012 BizBest® Media Corp.  All Rights Reserved.

Insider Guide to Silicon Beach

Silicon Beach — L.A.’s answer to Silicon Valley — is America’s new start-up rocket ship. New companies are launching daily, joining some 1,500 or more  already underway and in various stages. Silicon Beach conferences, seminars, festivals, mixers and other events are springing up everywhere.

But for many people, Silicon Beach is still somewhat mysterious. Yet it’s a smashingly vibrant scene — and growing more so by the day — punctuated with a dizzying array of cash-totting VCs and angels, along with assorted start-up accelerators, incubators, shared spaces and more, all fueling an organic, entrepreneurial energy.

This Insider Guide, from BizBest Media offers a quick overview of Silicon Beach and describes key players, events, venues, links and resources that are fueling its rapid growth.  Consider this version 1.0. We’ll be updating frequently, so please respond in Comments with ideas, suggestions and resources to help improve and expand our Guide.  (Also coming soon: SiliconBeacher.com and SiliconBeachBuzz.com, our new blogs covering the LA start-up scene.)

Beach ‘Boundaries’

While the epicenter of activity is Santa Monica and Venice, the Silicon Beach community casts a wider net, including neighboring beach towns such as Marina Del Rey and El Segundo, along with inland locations encompassing West LA, Culver City, downtown and other parts of LA proper. In other words, there’s no “official” boundary, although officials in Santa Monica and Venice have claimed it as their own.

To get an idea of how this looks geographically, check out Represent.LA, a really-cool site created by Tara Tiger Brown and Alex Benzer that maps the Silicon Beach community.  It pinpoints Tech Start-ups (631 listed), Incubators (28), Accelerators (15), Investors (50), Co-working spaces (28), Start-up Services (75) and Hackerspaces (3). Silicon Beachers can add others to the site; just fill out the submission form. This effort aims to (literally) put Los Angeles start-ups on the map!

Top Universities Meet at ‘The Beach’

Top L.A. universities are joining in the beach party as well. In September, for example, USC’s much vaunted Marshall School of Business held its first Silicon Beach @ USC event billed as “two days highlighting innovation, new ventures, partnerships and investment at the intersection of technology and digital content.”

SB@SC included panels on topics such as “Entrepreneurship & the Young Professional,” “Hollywood Meets Silicon Valley,” “Silicon Beach: Powering the Digital Ecosystem” and my personal favorite, “13 Years in the Dumbest Business in the World, and Still Going.”  There were presenters and sponsors from the likes of: Disney, Accenture, Sony Pictures, YouTube, Qualcomm, Fox Broadcasting and many others.

Cash Prizes for Silicon Beach Awards

The USC event also included a Silicon Beach Awards competition with cash prizes of $25K, $15K and $10K. Finalists were: AuraGraphics, Code Wars, Flutterly, Game Nation, Music Prodigy, Hive Lighting, iconicAM, Kuapay, Mobuku, Panjia, and TosNos.

Clustering Creates a Space Squeeze

Silicon Beach has spawned a clustering effect.  the more start-ups that locate here, the more others want to be in the same area. As a result, demand for start-up and other office space is soaring, sending rents skyward and making many start-ups scramble to try and locate near the heartbeat of the Beach.  While this didn’t happen overnight —  L.A.’s West-side has been home to many Internet and high-tech start-ups for a decade or more — it’s pace has quickened greatly.  And the more active it gets, the more talent it attracts.

Key Silicon Beach Players, Organizations and Resources

Here — in no particular order — are some of the key places, players, organizations and resources helping fuel the Silicon Beach boom:

  • DigitalLA In June 2012, DigitalLA launched the first Silicon Beach Fest, billed as a festival and hackathon to celebrate the burgeoning Silicon Beach community in Santa Monica, neighboring Venice and surrounding environs. Kevin Winston is founder. The website could use a makeover, but it’s a goldmine of links and info — along with lots of photos. Check out their frequent panels with advice for start-ups.
  • Tech Coast Angels: This active angel group has been around for years, and was one of the pioneers in putting Silicon Beach on the map.
  • LAVA: The Los Angeles Venture Association, a paid membership organization, defines itself as LA’s premier forum for entrepreneurs, venture capitalists, angel investors and professional advisors.
  • io/LA is a place to work, collaborate, and socialize. An entrepreneur-friendly month-to-month membership provides 24/7 entry to an expansive full service work space.
  • Cross Campus — no shrinking violet when it comes to hype — describes itself as “an engine of creativity and innovation, housed at our state of the art 11,000 square foot space at 820 Broadway in the heart of Santa Monica.  Our goal is to inspire creative collisions through space design, learning platforms, and extraordinary events, fostering member-driven collaboration that ultimately leads to game changing ideas and enterprises. As a member of Cross Campus, you are part of a select community of doers.  You enjoy a workspace that is designed to inspire and built to support the needs of entrepreneurs who aim high.”
  • Coloft: Calls itself “LA’s start-up hub…a community and work space focused on empowering entrepreneurs, startups & freelancers. We love tech. We believe in awesomeness.”
  • Real Office Centers (ROC), which took over the former Google space at 6th and Arizona in Santa Monica, is looking to duplicate its success with start-up spaces in San Diego, Newport Beach and La Jolla with a new space in the heart of Silicon Beach. The first floor is open — and looks great — but second and third floors are under renovation (those Google guys left it a mess).
  • Hub LA is a collaborative space for start-ups in downtown LA. It offers members access to 4,000 square feet of creative industrial space to work, meet, learn, collaborate, and play.
  • Amplify.la — to quote its own elevator pitch — is “a hands-on start-up accelerator and multi-faceted
    entrepreneurial campus in Los Angeles.” Located on Main Street in Venice.
  • Launchpad.LA is a start-up accelerator in Santa Monica that was founded as a mentorship organization in 2009 by Mark Suster with the goal of helping local entrepreneurs build relationships, get funded, and grow while remaining in Southern Cal. The idea came from Suster’s frustration with seeing LA companies receive funding from Northern Cal VCs and then relocate their teams.
  • MuckerLab, based in Santa Monica, is a mentorship-driven start-up accelerator focused on serving Internet software, services and media entrepreneurs in Los Angeles. It offers a 3 to 6 month program that includes up to $21k in funding, office space, access to world-class mentors, and hands-on product, marketing, legal and fundraising support.
  • StartEngineLA is a rapid accelerator focused on helping LA-based tech startups build a solid foundation for success in 90 days.  Created by Howard Marks, co-founder of Activision, and Paul Kessler, one of the most prolific investors in Los Angeles, Start Engine will provide local startups with the essential resources and counsel they need to become successful, self-directed businesses.
  • socalTECH.com is a news and information site covering high-tech companies in Southern Cal.  It has a great calendar of local events and a database of tech firms in the region.
  • DFJ Frontier invests in seed and early-stage tech companies in Silicon Beach (and other parts of the West Coast).
  • talkTECH Communications is a technology-focused, marketing communications firm
  • Google Los Angeles: has consolidated it’s LA offices in a high-concept building and mini-campus in Venice and is offering Silicon Beach support as well, and aims to sponsor local events and perhaps strike partnerships with some of the tech start-ups.

Stay tuned. More to come.

 Copyright © 2012 BizBest Media Corp. All rights reserved.

7 Keys to Being a More Bankable Entrepreneur

Some business owners and startup entrepreneurs just seem irresistible.  They’re the ones catching investors’ eyes, earning the highest fees and who rarely must search for clients and customers because clients come to them. How does this happen?

It’s not an isolated phenomenon. These kinds of “bankable” businesses and entrepreneurs exist in almost every industry, says Andrew Sobel, co-author along with Jerold Panas of “Power Questions: Build Relationships, Win New Business and Influence Others” (Wiley, 2012).  But bankable business superstars aren’t born, they’re usually self-made.

Here are seven keys that can unlock the hidden superstar in any entrepreneur:

1. Deliver something great, over and over.

Not easy, sure. But you can’t expect superstardom to occur overnight. You have to build your reputation for delivering results consistently year after year. Entrepreneurs who keep on delivering gain trust and become more “bankable.”

2. Have a high-powered value proposition.

It’s vital that you clearly articulate why customers should come to you above everyone else. What unique value do you and your business offer?  Your public value proposition doesn’t have to define everything you do with clients or customers, but it should make clear what you’re best known for. Businesses that don’t have a unique value proposition are just a commodity.

3. Be the one asking the questions.

Here’s a good test of where you stand: When you talk to potential investors or clients, are they the ones asking questions; grilling you on your credentials?  Or do you also tactfully test them for suitability as one of your clients or backers?  Good news here is that you don’t have to wait until you’re famous to put yourself in this position.  You can do it at any point in the life of your business. When you’re the one asking the thought-provoking, idea-inducing questions in the conversation, people take notice. You quickly move up a notch and take control of the discussion.

4. Be an industry thought leader.

These days, you don’t have to write a bestselling book to be seen as a thought leader. It starts by having deep focus and an abiding curiosity to learn everything there is to know about your industry. Then start passing along that knowledge, by blogging, speaking, consulting, writing articles for industry publications and participating in social media. It’s not a one-and-done proposition. You need to be out their daily.

5. Create a powerful name or brand.

In short, you need to become well known. That doesn’t mean worldwide. It might just be in your community or other limited sphere of influence – in your particular niche, marketplace or geographic area. When you are a known name in your specialty, people think of you when they need something. Name recognition works like a magnet. It’s never too late to start. Heed this advice: No matter how known or unknown you are now, plan one activity monthly that will increase your name recognition in some way.

6. Evaluate your scale and select clients carefully.

Superstars are scarce and should command the higher fees or prices. Think about how your business model scales.  Can you afford to work for or sell to everyone? Sometimes trying to sell at larger scale only ends up diluting your personal or business brand and your ability to deliver quality goods or services. Business superstars know they can’t – and shouldn’t – spread themselves too thin.

7. Price like a superstar.

While you have to achieve at least a semblance of star status before you can charge premium rates, there’s actually more to it. “Research has demonstrated that high prices lead to high perceived value,” says Sobel. “Most people think it’s the other way around – that if you deliver high value, only then can you get high fees.”  Look at it this way. As you become more and more bankable, you enter a virtuous circle of ever-higher perceived value. Investors and customers know that backing or hiring you in particular lowers their risk, and that’s worth paying for.

© 2000-2012 BizBest® Media Corp.  All Rights Reserved.

A Financial Statement Cheat Sheet for Business Owners

This is about financial statements. I’m sorry, but stay with me. Sure, social media would be a far sexier subject.  But hey, if you ever file a tax return (and you’d better), need bank financing, angel investors, venture capital or a loan from friends and family, these are things you must know.

The fact is, most business owners and startup entrepreneurs never had a formal course in business finance. With that in mind, here’s a “cheat sheet” to help you understand the three basic financial statement flavors: 1) Balance sheets; 2) Income statements, and; 3) Cash flow statements.

Your balance sheet

This shows what your business owns and what it owes at a fixed point in time, and provides details about your assets, liabilities and owners’ equity. It does not show money that flows in and out of the accounts during that period (we’ll get to that shortly).

  • Assets are things your business owns that have value and could be sold, including tangible assets such as vehicles, equipment, inventory and cash, plus intellectual assets such as trademarks and patents.
  • Liabilities are amounts your business owes to others, including loans, rent, vendor accounts, payroll and taxes, as well as obligations to provide goods or services to customers in the future.
  • Owners’ (or shareholders’) equity is your capital or net worth. It’s the amount that would be left if the business sold all assets and paid off all liabilities. This leftover money belongs to the owners.

Your income statement

This shows revenues over a specific time period – i.e. a month, quarter or year – and what you spent to generate that revenue. The literal “bottom line” of an income statement shows what the business earned or lost over that period.

Think of an income statement as a stairway. You start at the top with total sales, and then go down one step at a time. At each step, you make a deduction for costs or other operating expenses that were necessary to earn the revenue. At the bottom of the stairs, after deducting all of the expenses, you learn how much the business earned or lost.

Your Cash flow statement

This shows inflows and outflows of cash over a fixed period. It’s critical because any business needs cash to cover ongoing costs. While an income statement (above) shows profit or loss, a cash flow statement merely indicates if the business generated cash. You should also know that a cash flow statement shows changes over time, not absolute dollar amounts at a given point. The bottom line of the cash flow statement shows how much it went up or down for the period. Generally, cash flow statements review the cash flow from three key activities: operating, investing (back into the business) and financing.

Key Terms and Ratios to Know

Here’s a mini glossary of four key financial statement terms and ratios you’ll also want to know:

  • TheDebt-to-equity ratio compares total debt to owners’ equity. Both numbers come from your balance sheet. To calculate a debt-to-equity ratio, divide total liabilities by owners’ equity. If a business has a debt-to-equity ratio of 2-to-1, for example, it means that it is taking on debt at twice the rate that its owners are investing in the company.
  • Inventory turnover ratio compares a company’s cost of sales on its income statement with its average inventory balance for the period. To calculate this ratio, divide cost of sales by average inventory for the period. A 2-to-1 ratio means the company’s inventory turned over twice in the reporting period.
  • Operating margin shows percentage of profit for each dollar of sales. It compares operating income to net revenues. Both numbers come from the income statement. To calculate operating margin, divide income from operations (before interest and income tax expenses) by net revenues. Operating margin is usually expressed as a percentage.
  • Working capital is the money leftover if the business paid its current liabilities (debts due within one-year) out of its current assets.

Now that wasn’t so bad, was it?

Copyright © 2000-2012 BizBest® Media Corp.  All Rights Reserved.  Follow @140Main