Has the Word 'Entrepreneur' Lost Its Meaning?

BY: Penelope Trunk

Now that everyone is a so-called entrepreneur, the word is losing its edge. And entrepreneurship with a big E is a pain in the neck.

We are in the golden age of entrepreneurship. In fact, it has become so mainstream that it’s bordering on cliché.

The majority of generation Y says they want to start a company, according to USA Today. Entrepreneurship is the most popular focus in MBA programs. And half the resumes I see have some sort of self-started company listed at one point or another.

But we need to stop talking about being an entrepreneur. I find that people either use the label entrepreneur to tell everyone how great they are, as if entrepreneurship is the equivalent of Hollywood stardom. Or, people use the label to convey personal disdain, as in, “I want to be an entrepreneur but I’m ….” 

In fact, most people are entrepreneurs, whether they embrace the label or not. They have to control their own career and make their own jobs. And most people who do call themselves entrepreneurs are worried that they don’t have an idea, worried that their idea isn’t working, or worried that they are starving and will need to take a staff position at some huge company. So the difference between who is and who isn’t an entrepreneur is vague. We toss around the word entrepreneur so much that the word is quickly becoming meaningless. Here’s why:

1. Everyone is an entrepreneur.

Entrepreneurship means taking responsibility for yourself. It means you assume that there won’t be anyone there to hand you a reliable paycheck, nor will there be anyone else to make sure you’re on a suitable career path. In today’s workforce, you are either thinking this way or you are unemployable. Entrepreneurship is the safety net we hold onto in a very unstable and unforgiving workplace.

2. Entrepreneurship is often a part-time time job. In the shower.

It’s very hard to think of a business idea. Most ideas stink. I have had three startups, all of them funded, and it takes me about three years to come up with a solid, new fundable idea. So yes, I’m an entrepreneur, but I don’t have a company and I don’t have an idea, and I’m just like the guy in the cube next to you who goes to work every day trying to figure out what his next step is. And, like many people, my best ideas happen in the shower.

3. Entrepreneurship with a big E is a big pain.

The kind of company you can exit from, the kind of company that you hear tossed around at cocktail parties like, “He sure has a lot of money now!” Those type of companies are incredibly high-pressure, all-consuming and extremely high-risk. Most ideas don’t succeed even if they get some funding. Most founders kill their personal credit on the idea and don’t exit, and most marriages dissolve when one person is married to their company. 

4. The risks of self-employment do not go with parenting.

Look, of course the idea of working for yourself is appealing. Until you have to manage a totally unreliable income and support your kids. Then it’s really scary. Very few people find that the benefits of self-employment outweigh the very real fear of not knowing if you can pay for your kid’s camp next summer. Erratic income is very, very hard on kids. (I would know. My electricity was turned off.)

5. Entrepreneurship is not glamorous. Cashing out is glamorous.

Of course it’s exciting to be the idea person and change the world. But most self-employed people are doing drudge work most of the day. Because when it’s your business, you want to do as much of it as possible in order to protect your profit margin. Entrepreneurs wear forty different hats. You know this. What you don’t know is that 39 of them are entry-level.

So when you walk around saying you want to be an entrepreneur, recognize that what you really want is control over your financial life and recognition for your ideas. You can get that in a wide range of jobs much more easily than you can get it working for yourself.

But this doesn’t mean you are giving up your dream to be an entrepreneur. It means you recognize that entrepreneurship is a mindset that is non-negotiable in today’s market. What is negotiable is how much risk you take. And for most people a startup is simply too chaotic to be enjoyable.

SOURCE: www.inc.com

How to Tell if You Have a Great Idea

BY: Penelope Trunk

There's plenty of money out there for great ideas. How to tell if you've got one.

There’s plenty of funding if you have a good idea.

Somehow, a bunch of entrepreneurs got it into their heads that good ideas go unfunded. It’s just not true. Because part of what makes something a good idea is the fact that the founder can convey that it’s a good idea. And in the world of funding, there are rules about how one conveys a good idea. You need an addressable market. You need to solve a problem for that market. There needs to be a way to make money. A lot of it. And there needs to be a barrier to entry.

I’m blown away by how many founders think they can get away with not having one of these things. You could have a weakness, sure. But you have to have the essential components of a good company, or you don’t have a good company.

There are plenty of people who will give you feedback on your idea. It takes very little knowledge of the startup world to recognize a crappy idea, because most ideas are so crappy in so many ways and you only need to be able to see one of them.

Here’s how founders get good ideas for companies. You start with an idea, and you tell a friend. Your friend immediately tells you why it’s a bad idea. You do this 20 times until your friend says, hmmm. That’s a good idea.

Then you tell your idea to a serial entrepreneur or an active angel investor. And that person tells you why your idea is terrible. This happens 30 times. You will have to find a bunch of different people to harass in this way. A friend will put up with 20 bad pitches. Someone who is not a friend can deal with five to 10 ideas before they start to find you annoying.

Eventually, someone who is active in the startup world says, “Hmm. That’s a good idea.” Then you make a deck and pitch to a few investors who could actually put money into the company. Only pitch to a few, because after three there will probably be a consensus about your weak point. Maybe you can’t make enough money to warrant investment. Maybe the barrier to entry is really weak. Maybe you know the market to address, but you can’t quite get to it.

After pitching three times, you’ll know which part of the pitch will stop investors in their tracks every time. Decide if you can overcome that. You need a new plan to overcome it because right now, you look weak.

This is a really hard moment for an entrepreneur. You have pitched 50 ideas. Met with ten people. Researched the hell out of this market. But maybe it’s still not a winner. You are way better off dumping the idea now than in two years. So if you need to, dump the idea now. It’s okay. It takes most entrepreneurs years to come up with their next fundable idea.

What I mean by fundable is that everyone says, “That’s a good idea.”  No one likes to believe this, but there is general consensus about what is a good idea. That’s why investors look like sheep. They are not sheep so much as they are looking for the obviously good idea. If it’s not obviously good, it’s not good.

You know what? Sprout Skincare approached me a few weeks ago. The CEO, Adina Grigore, told me about the idea. Beauty products with a very short list of ingredients that are sourced locally, from family farms.

Right away I knew Sprout was a good idea. The pitch is one sentence and it’s clear and it rings true. I can immediately imagine the company growing to be huge. Sprout is one of those great ideas that make people excited after a very basic, straightforward pitch.

So I called the Grigore, and guess what? There is widespread interest in Sprout from investors and retailers. She is figuring out which will offer her the best path to get what she wants. And you know what? I’m not surprised. Because there’s a lot of funding out there for a good idea.

So to all of you who think that getting funding is complicated, or political or arcane: You’re lying to yourself. If you ask one person for help, and it’s a good idea, you’ll get the name of someone who can help you. If you don’t have a good idea, you don’t get help.

Funding is not difficult. Finding good ideas is difficult. But the most difficult thing for an entrepreneur is to spend time becoming personally invested in a new idea and then tossing it to the wind. Dumping an idea you love is as brave as running with an idea you love. They’re two different types of bravery that get you to the same goal: A great company for you.

Penelope Trunk is the founder of three VC-funded startups. She is the author of the bestselling book, Brazen Careerist: The New Rules for Success, and her blog, penelopetrunk.com, receives about one million views a month. Earlier in her life Penelope played professional beach volleyball, which, believe it or not, taught her just about everything she needed to know about marketing.

SOURCE: www.inc.com

6 Habits of True Strategic Thinkers

BY: Paul J. H. Schoemaker

You're the boss, but you still spend too much time on the day-to-day. Here's how to become the strategic leader your company needs.

In the beginning, there was just you and your partners. You did every job. You coded, you met with investors, you emptied the trash and phoned in the midnight pizza. Now you have others to do all that and it's time for you to "be strategic." 

Whatever that means.

If you find yourself resisting "being strategic," because it sounds like a fast track to irrelevance, or vaguely like an excuse to slack off, you're not alone. Every leader's temptation is to deal with what's directly in front, because it always seems more urgent and concrete. Unfortunately, if you do that, you put your company at risk. While you concentrate on steering around potholes, you'll miss windfall opportunities, not to mention any signals that the road you're on is leading off a cliff.

This is a tough job, make no mistake. "We need strategic leaders!” is a pretty constant refrain at every company, large and small. One reason the job is so tough: no one really understands what it entails. It's hard to be a strategic leader if you don't know what strategic leaders are supposed to do.

After two decades of advising organizations large and small, my colleagues and I have formed a clear idea of what's required of you in this role. Adaptive strategic leaders — the kind who thrive in today’s uncertain environment – do six things well:

Anticipate 

Most of the focus at most companies is on what’s directly ahead. The leaders lack “peripheral vision.” This can leave your company vulnerable to rivals who detect and act on ambiguous signals. To anticipate well, you must:

• Look for game-changing information at the periphery of your industry
• Search beyond the current boundaries of your business
• Build wide external networks to help you scan the horizon better

Think Critically

“Conventional wisdom” opens you to fewer raised eyebrows and second guessing. But if you swallow every management fad, herdlike belief, and safe opinion at face value, your company loses all competitive advantage. Critical thinkers question everything. To master this skill you must force yourself to:

• Reframe problems to get to the bottom of things, in terms of root causes
• Challenge current beliefs and mindsets, including your own
• Uncover hypocrisy, manipulation, and bias in organizational decisions

Interpret 

Ambiguity is unsettling. Faced with it, the temptation is to reach for a fast (and potentially wrongheaded) solution.  A good strategic leader holds steady, synthesizing information from many sources before developing a viewpoint. To get good at this, you have to:

• Seek patterns in multiple sources of data
• Encourage others to do the same
• Question prevailing assumptions and test multiple hypotheses simultaneously

Decide

Many leaders fall prey to “analysis paralysis.” You have to develop processes and enforce them, so that you arrive at a “good enough” position. To do that well, you have to:

• Carefully frame the decision to get to the crux of the matter
• Balance speed, rigor, quality and agility. Leave perfection to higher powers
• Take a stand even with incomplete information and amid diverse views

 Align

Total consensus is rare. A strategic leader must foster open dialogue, build trust and engage key stakeholders, especially when views diverge.  To pull that off, you need to:

• Understand what drives other people's agendas, including what remains hidden
• Bring tough issues to the surface, even when it's uncomfortable
• Assess risk tolerance and follow through to build the necessary support

Learn

As your company grows, honest feedback is harder and harder to come by.  You have to do what you can to keep it coming. This is crucial because success and failure--especially failure--are valuable sources of organizational learning.  Here's what you need to do:

• Encourage and exemplify honest, rigorous debriefs to extract lessons
• Shift course quickly if you realize you're off track
• Celebrate both success and (well-intentioned) failures that provide insight

Do you have what it takes?

Obviously, this is a daunting list of tasks, and frankly, no one is born a black belt in all these different skills. But they can be taught and whatever gaps exist in your skill set can be filled in. I'll cover each of the aspects of strategic leadership in more detail in future columns. But for now, test your own strategic aptitude (or your company's) with the survey at www.decisionstrat.com. In the comments below, let me know what you learned from it.

SOURCE: www.inc.com

Great Product? That's Just the Start

BY: Vanessa Merit Nornberg

Boost customer loyalty, create marketing opportunities, and shorten the sales cycle--without spending much doing it. Here's how.

One of the most difficult challenges for businesses, from start-up mode to mature entity, is creating "relevancy" with customers. Being relevant does not stop with having a great product—that's often just the first part of the equation. Real relevance happens when you find ways to add value to your customers' lives—before, during, and after a sale.  Relevance makes customers choose your company over a competitor, it generates customer satisfaction during their interaction with your company, and it keeps them bringing their business back to you time and again. Make your business relevant in three easy steps.

1. Offer extra insight. 

When customers are deciding who will win their business, they are often faced with multiple offers, which, at first glance, can appear similar to each other.  Set your business apart by not only showing customers the value of your product, but also the expertise that comes with it.  If you own a real estate company, for example, don't just send postcards with a picture of your latest listing—include a tip on a nearby neighborhood restaurant and maybe even a recipe from that eatery. This will give your customers insight into their potential new neighborhood and inspire them to imagine living there—from cooking in their new kitchen to dining out near their new home. As an added bonus, reach out to the restaurant and get them to pick up the cost of the mailing in exchange for the free PR.

2. Make your company an information hub.

Customers' time is valuable.  Make your business relevant to them by acting as a sieve through which the information they need to make their buying decision passes. Simplifying industry research or giving expert advice on purchasing makes it easy for customers to buy through your business. When a customer recently called to say her state was changing the laws governing licensing for piercers, we knew all of our customers in the same state would need to make changes quickly in order to be in compliance, and we made it easy for them by putting details about the changes in legislation on our website. We were sure to extract the relevant data which relate to the products we sell. We even added a 'tell a friend' link to the page so readers could let other stores in their area know where to go to get clarity.

3. Protect your customers--even after they buy.

Customers like to spend money where they feel safe. One of the best ways to remain relevant is to continue to protect your customers after they purchase with you.  If your company is a travel agency, for example, don't let the interaction end when the airplane ticket is purchased.  Keep yourself on the top of your customers' minds by sending them a checklist of important travel information a week before departure. Remind them about carry-on liquid rules, health and safety concerns at their destination, or important items to pack for international travel.  This lets them know you are as invested in their vacation as they are in your business.  If you highlight a particular product in this process, contact the company that sells it and ask to send your checklist to their email list too (with a link back to your travel site).  You just might gain new business. 

Relevance is a powerful tool both in growing your business and in safeguarding your standing in the marketplace. Efforts to remain relevant can boost customer loyalty, create marketing opportunities, and shorten the sales cycle—all for very little money.

SOURCE: www.inc.com

Do You Need to Have Money to Make Money?

BY: Courtney Rubin

Having access to money triples the likelihood that you will consider starting a business, says a new Gallup poll.

The worldwide poll of some 10,000 adults in 98 countries found that adults who had access to funds are three times more likely to say they plan to start a business in the next 12 months (18 percent) compared to those who don't (six percent).

Entrepreneurial intent varies widely by country. Though access to money universally improved the odds, it was less important in developed parts of the world. Residents of sub-Saharan Africa are the most likely to be planning a venture, though access to financing more than doubles the likelihood, from 16 percent to 39 percent. Just over a fifth (22 percent) of adults in Asia with funding access are planning to start a business, more than quadruple the five percent who don't have access.

By contrast, seven percent of adults in the US and Canada said they planned to start a business within the next year–compared to nine percent of those with access to finance. Money was slightly more important in the European Union: 2 percent of adults overall were planning to try entrepreneurship, compared to 7 percent of those with money.

"In Northern America, higher living standards, personal wealth, high-risk tolerance, and financial inclusion suggest that financing is not a major constraint to entrepreneurship in this part of the world," researchers Sangeeta Badal and Rajesh Srinivasan wrote. "Even if an individual does not have immediate access to money to start a business, he or she may be more likely than those in the developing world to be confident that he or she can secure the funding needed in the near future."

The study found financial access matters more to women than to men. Women who have access to capital are four times more likely to plan to start a business (16 percent) than those who do not (4 percent), while men who have access are nearly three times as likely to start a business (20 percent) as those who do not (7 percent).

SOURCE: www.openforum.com

Would You Take Business Advice From a College Student?

By: Jennifer Alseve

Why Jen O’Neal, founder of Tripping, created an advisory board of young people

Courtesy Company

Student Teachers Tripping co-founders Jen O'Neal and Nate Weisiger (front) lean on young people for marketing advice.

Before launching a new marketing campaign, Jen O'Neal first ran the idea by her board. O'Neal is CEO of Tripping, a San Francisco–based Internet start-up that connects world travelers with local hosts, who offer sightseeing tips, conversation, and sometimes a free place to crash. To promote the site in Barcelona, O'Neal was considering hosting evening events on college campuses. Board member Jacopo Bordin shot down the idea. After class, he said, young Europeans aren't hanging out on campus—they are relaxing at wine bars and outdoor cafés.

Bordin should know. A 23-year-old student at the Academy of Art University in San Francisco, he grew up in Italy. Bordin sits on Tripping's social media board, a 10-person team of twentysomethings who advise O'Neal on marketing to students, the site's primary users.

O'Neal and her co-founder, Nate Weisiger, came up with the idea for the advisory board last year after hiring an intern to manage the company's blog, Twitter feed, and other social media efforts. Some 200 young people applied for the position. After making her choice, O'Neal sat down to toss out the rest of the applications, many of which included enthusiastic stories about travel and studying abroad. "I didn't want to delete the e-mails," she says. "I hated the idea of releasing all these people and not coming into contact with them again."

At the time, Tripping had just three employees and didn't have the resources to hire any more. But O'Neal and Weisiger thought the young people would make great advisers. To determine which candidates had the most creativity and enthusiasm—and ability to get the word out about Tripping—the co-founders decided to hold a contest. They went through the intern applications and challenged the 40 most promising candidates to vie for spots on the board. The contenders had three weeks to generate as much online buzz as possible about Tripping. About half of the people O'Neal contacted took her up on the challenge.

The contenders used various tactics to get the word out about the company. Because Tripping markets itself as a place to get insider travel tips from locals, Katy Birnbaum, then a San Francisco State University senior, made an online video of the 1 a.m. swarm of people lining up for fresh doughnuts at Bob's Donut & Pastry, a popular hangout for college students. Lauren Nicholl, a graduate of the University of California, Davis, contacted popular travel bloggers and raved about Tripping. She also took to Twitter, posting information about Tripping as well as links to travel articles and famous quotes about travel.

Whenever O'Neal updated the company's blog, the young people would flood it with comments. The CEO was impressed by the group's eagerness. "You could see this rivalry," she says. "They were trying to edge each other out. We didn't think people would work that hard to get a seat on this new board we just invented." In the end, O'Neal chose 10 of the applicants for the board—Birnbaum and Nicholl made the cut.

The board members don't have daily responsibilities. They primarily act as brand ambassadors and offer the co-founders opinions, advice, and ideas. "It feels completely different than an internship," says Bordin. "You feel more involved, more rewarded."

Already, the board members have contributed many new ideas. "They have grown up with technology in ways I didn't," says O'Neal, who is 31. "Some of the best ideas came from people who barely had any work experience." Birnbaum, for instance, came up with a feature called video validation, which helps travelers vet potential hosts in other cities. Since its founding, Tripping has encouraged users to rate and review hosts, but O'Neal wanted to add another level of verification for young travelers who would be meeting up with strangers or staying in their homes. Birnbaum suggested that Tripping interview hosts remotely using Skype; Tripping would ask them to show their passports and proof of address during the video calls and would keep a record of the information.

O'Neal loved the idea and had Birnbaum head up the project. Not only has the video validation feature been popular with Tripping users, says O'Neal, but conducting Skype chats with hosts also provides valuable customer feedback that the company has used to improve the site.

Board members aren't paid, but they receive training from Tripping's co-founders. Weisiger teaches board members how to write Web code and create Facebook ads. O'Neal helps them with job hunting, polishing their resumés, and conducting mock interviews and introduces them to other entrepreneurs in Silicon Valley.

Each board member determines his or her level of involvement. Bianca Cloutier, a recent Dartmouth graduate, already had a full-time job at a nonprofit in New York City, but she joined Tripping's board because she wanted to get experience at a tech company and learn more about business development. Jeff Manheimer, Tripping's vice president of business development, invited her to tag along when he went to meetings on the East Coast. She watched him create promotional partnerships with groups like university study-abroad programs. Working nights and weekends, Cloutier eventually signed up six new partners, including the alumni network of AmeriCorps, a student volunteer organization with more than 600,000 alums. "This was perfect for me," says Cloutier. "The flexibility was great."

The social media board has also become a useful recruiting tool for Tripping. Since creating it, O'Neal has hired four board members as full-time employees. And she plans to keep adding members to the social media board as the company grows. "It's so easy to see who is passionate," says O'Neal. "Some of them really shined."

For tips on assembling an advisory board, including how to choose the right members, compensate participants, and structure board meetings, go to www.inc.com/building-a-board-of-advisors.

SOURCE: www.inc.com

Event Recap: Bricks and Mortar's Big E-Commerce Opportunity

Inc. 5000 CEOs present their secrets of success

 

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With great anticipation, Inc. 5000 CEOs presented their secrets to e-commerce greatness on April 24 here at Inc.Magazine HQ in Downtown NYC. Terrence Kellemen of Dynomighty, based in Brooklyn's Dumbo, and New York based Gotham Dream Cars CEO, Noah Lehmann-Haupt shared two amazing success stories with the business owners of the New York-New Jersey-Connecticut community.

Terrence: As a "case study" for Google tools, Terrence has used the highly targeted Google platform --particularly YouTube (the second largest search engine on the web) so he could demonstrate his bricks and mortar product in use--to create more than 17 million page views of his product, the Dynomighty wallet, all for little to no money. His company has never had more demand than they do today as a result.

Noah: When Groupon and other "daily deal" sites came calling to Gotham Dream Cars, Noah had already heard the 'daily deal" horror stories. He created a new product, exclusively designed for success within the daily deal framework and has seen a massive uptick in revenues as a result. Noah had some cautionary tales about the "deal-seekers" that come his way but he's embraced the business model in a big way and is creating new products just for this customer.

Both Noah and Terrence agreed that social media was the next frontier for their marketing efforts. They believed that getting their current "fans" to promote their products to those personal networks was the next big opportunity. And take it from them, the big opportunity is out there for those who pursue it. 

Terrence offered the Dynomighty credo to all the attendees as they venture out into the new online marketplaces:

Be creative!
Be innovative!
Be mighty!

Thank you Noah and Terrence for sharing your wisdom and your acumen.

A special shout out to Vu Telepresence for partnering with The Council to bring this event to our community of business owners.

SOURCE: www.inc.com

Become an Entrepreneur--No Idea Required

You get a salary, equity, mentors, and more. An inside look at how a San Francisco 'foundry' plans to build the next killer start-up.

Want to start a company... but you're short on ideas? There's an incubator for that.

Well, actually, it's called a "foundry."

What is a foundry?

Chicago-based Sandbox Industries recently opened a new start-up foundry in San Francisco. Managing Director Millie Tadewaldt says unlike a traditional incubator that brings in early-stage start-ups already working on idea, Sandbox simply looks for talented people–often with no entrepreneurial experience. It gives them mentorship and capital and tasks them with identifying promising new start-up ideas through testing, market research, focus groups–whatever it takes to figure out which ideas have legs.

Its closest proxies, she says, are Santa Monica-based Science or New York-based Betaworks, although what makes Sandbox different is its venture capital arm. Projects are initially funded internally by the foundry, then when mature, the teams seek funding from outside VCs and angels, as well as from Sandbox's venture funds.

Shared resources are lean

Sandbox also works with entrepreneurs to build teams using shared resources within Sandbox.

"We have a team of designers, developers, social media people, writers, and PR that are already here so when a person comes in and wants to work on an idea they don't have to go hire a developer to build the prototype. We have one. They don't have to hire a designer to make the logo. We have one," Tadewaldt says.

In essence, Sandbox tries to turn any one business person into a ready-made startup team, at least in the early stages.

Entrepreneur ownership grows over time

And because Sandbox also has a venture capital arm it can also provide larger amounts of funding as a company grows--which brings up the question of ownership.

Tadewaldt says Sandbox owns a large percentage of the companies initially because it's proving all of the resources, salaries, and equity to the "founders-in-residence."

"Meanwhile as they work on businesses that start to succeed they receive equity grants to acknowledge the incentive that entrepreneurs need to stay up all night with a business and make it their own," she says. "So it's like a straddle between being an entrepreneur on your own where you get no salary but you get more equity versus being an employee at a company where you get a salary and probably very little equity, if any at all," she says.

It's an interesting idea and one that Tadewaldt says takes pressure off entrepreneurs and allows them to be more objective while at the same time giving them incentives for getting traction.

Killer questions purge the bad ideas

The notion behind Sandbox is that there are a number of things that can get in the way of building a business and by reducing mistakes and the time founders spend making them, entrepreneurs can spend more of their resources actually building out an idea.

One way Sandbox does that is by asking early on what it calls "killer questions."

For instance, one company born in the Sandbox foundry is the women's fashion company CakeStyle which once a season sends a box of high-end clothing to customers along with a video that explains how to wear the items and why each was picked.

Sandbox mentors asked the company's founders two key questions: Would women want someone else shopping for them? And would brands sell to CakeStyle wholesale? As it turned out, answers were affirmative on both counts.

"Tackling these big questions early on rather than ignoring them allowed us to vet the idea more quickly rather than going to the trouble of building out all this inventory and a technology platform before we even knew if women wanted to buy what we were offering," Tadewaldt says.

A couple of other companies Sandbox says have benefitted from the foundry concept are Marbles: the Brain Store and DoggyLoot, both of which have experienced impressive growth of late.

Tadewaldt says the Sandbox foundry, which is located at 444 Townsend St. in San Francisco, will have nine to 10 entrepreneurs on staff by the middle of the summer.

SOURCE: www.inc.com

Want to Build a Business to Last? Here’s the Secret

Google, Apple, Amazon, and Facebook all know the strategy. Here's how you can make it work for your business.

Editor's note: The following is an excerpt from The Age of the Platform: How Amazon, Apple, Facebook, and Google Have Redefined Business. Published by Motion Publishing (2011).

As 2011 progressed, I began to feel a compelling need to write a book about the platform as an important and new business model. As I will explain shortly, I have learned from personal experience that building a platform is not only beneficial, but also imperative for many companies' survival. I look at myself as a case in point: In a relatively short period of time, I redefined my business and launched completely new products and services. How did I do this? In short, I built my own platform.

The backstory

By way of background, from 2002 until 2008 with a few brief exceptions, my entire livelihood was tied to one fairly specific type of work: enterprise resource planning (ERP) consulting.

Even that type of relatively provincial work involves a wide variety of people and technical skills. Let's just say, however, that more than 99% of all companies never considered engaging me. And probably 99.99% did not need me at any given time.

Despite this significant limitation, by 2008 I had started to come into my own. That year, I knocked the ball out of the park, making more money than at any other point in my life (nearly $250,000). I had concurrently balanced several difficult projects and had taken just one week off. For me, 2008 was the very definition of the "feast" year about which independent consultants like me dreamed—as in feast or famine. By any measure, I should have been ecstatic.

How long would the feast last?

Yet, at least professionally, I was quite concerned. At the time, I was 36 years old. As I gave my accountant my third-quarter financial statements to prepare my taxes, I told myself: I had better enjoy this while it lasts, because it just couldn't get any better. I couldn't raise my rates forever and there were only so many hours in a year. Plus, rarely does an independent consultant like me move seamlessly from one project to another for an entire year as I just did. Downtime was a given in any economy, and ours was getting worse.

I knew that I needed to diversify and establish myself in different lines of business—or face dire consequences. But somehow that didn't seem sufficient. I strongly suspected that I would have to refine my entire business model—and maybe even blow it up. In the long-term, this shift was necessary, but there was a short-term problem: No one cared. The world at large was not terribly interested in my decision to enter new lines of business—nor were many of my clients for that matter.

If I was going to be successful in diversifying and mitigating my own risk, I would have to build my own platform.

Simon 2.0

Fast forward to mid-2011. As I send my same accountant my quarterly financial reports, "Simon, Inc." barely resembles the company of less than three years ago. That same type of consulting that generated more than $200,000 in revenue for me in 2008 is now barely a line item on my P&L statement. I had completely transformed my business. In part by accident and in part by design, over the next three years I launched entirely new lines of business. I earned money via services such as website design, writing, book coaching, marketing, and other areas for which I had no formal training. I made money from book royalties and mobile app sales. I also started a publishing company and a public speaking practice. In large part, I would have not been able to pay my bills and continue working for myself if I had not built an effective platform.

However, platforms are not elixirs. You still have to do the work. In my case, I had to develop a new brand and offer services that people would want—and pay for. (For more on that, check out the book.)

For three reasons, I'm glad that I started diversifying and building my platform when I did. First, I was beginning to tire of working on the same types of highly contentious projects.

Second, I wanted to tackle new challenges and continue my own professional development. Third and most important, my shift turned out to be an economic imperative. In hindsight, my timing could not have been better. By early 2009, ERP consulting had slowed to a trickle, and many of my colleagues had either lost their jobs or could not find work.

Although I have yet to replicate the financial success of 2008 (and may never do so), my platform-based business model is much more sound and resilient to risk. I start each year with a fair amount of base income from my writing and speaking clients. What's more, book sales generate passive income for me. Unlike years past, I no longer start at zero every January. As my platform continues to evolve in new and unexpected ways, it generates new income and opportunities for me.

Have you made moves to turn your business or career into a platform? Tell us about it in the comments.

SOURCE: www.inc.com

8 Ways to Keep Creativity Fresh While Scaling a Start-up

Ideas can grow stale once a start-up scales. We asked successful young entrepreneurs why its important to continue sparking creativity while a company is growing fast.

The Young Entrepreneur Council asked eight successful young entrepreneurs to give their best tips for successfully scaling a start-up team, while still keeping the creative environment fresh. Here are their best answers.

1. Can I Buy You a Drink?

Look for a strong cultural fit when hiring for your start-up—and not just their resume and experience. If you don't get along with a person—wouldn't enjoy having Friday beers with them—then don't bring them onto your team. The negative impact on morale from making a wrong hire can be tremendous, so be careful. Fire quickly if things don't work out.
—Matt Mickiewicz, 99designs

2. Spread the Recognition

To scale a start-up and keep work interesting, you'll want to frequently announce milestones reached, but also press your team for constant improvement. When your team starts to realize they're really contributing to a business that's making real progress, and are learning a lot more than they have at any other work environment, they'll never leave.
—Danny Wong, Blank Label Group

3. Start a Chain Reaction

Best piece of advice I ever heard was only hire those you would trust to hire others without consulting you. If you start off with an amazing team of creative people and follow that rule, your team should continue to have the same creative touch.
—Ben Lang, EpicLaunch

4. Share the Business Vision

When you're leading your company, no matter how employees you have or want to bring on, it helps to share the business vision. If you have new projects or different tasks that need to get done, your team is a lot more likely to get on board when they know where you're going. That in itself will keep the environment humming.
—Nathalie Lussier, Nathalie Lussier Media

5. Only as Strong as Your Weakest Link

Find areas where you are weakest and hire passionate experts in those areas. Keep in mind you can teach skills very easily, but teaching personality and attitude is next to impossible. Find people with passion and personality that fit your organization and then teach them skills in the areas where you are lacking.
—Lucas Sommer, Audimated

6. Trial Runs With the Team

Keeping the creative environment and culture strong are critical for a startup. Great candidates on paper may not fit with your current team. Hire everyone as a contractor at first — take four to ten weeks to make sure that they fit within your culture, and give the new employee the same courtesy to make sure that she or he is happy with your team!
—Aaron Schwartz, Modify Watches

7. Let the Team Grow Too!

Delegate and trust your team. It's the only way to grow effectively. A startup owner can't do everything, and trying to simply stifles your team. One of the appeals of a startup is how much growth it affords its people; delegate so you don't deny them that.
—Brent Beshore, AdVentures

8. Balance that Passion

It's important that you balance a startup with creative people and people who can execute. You need the creative people to take your company to new levels, but it's equally as important to have the employees that will "get stuff done".
—John Hall, Digital Talent Agents

SOURCE: www.inc.com

The Top 5 Richest Africans Over the Next Decade

Africa's Wealthy Elite

In years to come, Africa's wealthy elite will continue to dominate the territories they command now - this is what their current fortunes tell us.

In many parts of Africa, personal wealth comes with great responsibility. Individuals who control a country's major industries are responsible for providing jobs for thousands of households, and generally influencing the territory's economy in a significant manner.

For these elite few - the men who are consistently ranked among the world's richest people - sustaining their substantial wealth is as demanding as the effort it required to create it in the first place. In the league of Africa's rich men, there is no such thing as small money, and also, there is no such thing as 'Once rich, always rich'.

We profile five of Africa's richest men and find out who is most likely to increase their fortunes over the next decade - and who will give the most back.

Aliko Dangote – Nigeria

Aliko Dangote - Nigeria
Dangote's wealth is currently pegged at around $10.1 billion, most of which was generated through investments in sugar, flour, and cement. The 54-year-old father of three is currently the continent's richest man, according to Forbes magazine.

His claim to fame as the 'Cement King' of Africa is inspired by his dominance of the cement trade in a number of Africa countries. Dangote currently owns cement plants in Zambia, Senegal, Tanzania, and South Africa, and has also received approval to build two more plants in Cameroon and the Ivory Coast.
Two years ago, Dangote Cement was listed on the Nigerian Stock Exchange, and that has since helped swell his fortunes further.

So how does the Dangote story go? There are tales of how he started off with a loan from his uncle, and from there went on to spearhead the growth of the Dangote Group.

Dangote is a committed philanthropist who continues to invest heavily in many social issues, including providing healthcare and access to quality education.

Dangote has demonstrated beyond measure that his wealth won't fade away - at least not in the next decade.

Theophilus Danjuma - Nigerian
Danjuma is thought to be worth about $600 million, largely derived from his holding in South Atlantic Petroleum (SAPETRO). Danjuma is one of the continent's richest men and with the rising price of oil, his fortunes increase every day.

Danjuma, the former Defense Minister of Nigeria, was ranked as the 21st richest man in Africa, according to Forbes. His charity trust, the TY Danjuma Foundation, continues to offer hope to thousands of households.
Currently, he advises the Nigerian government on official, state and government matters.

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Cyril Ramaphosa - South Africa
Ramaphosa is a former National Union of Mineworkers activist, and is now thought to be worth in the region of $275 million, generated through a wide range of investments.

The 59-year-old owns the Shanduka Group, an investment holding company that has stakes in mining, banking, real estate, insurance, and telecoms, among others.

Ramaphosa is well-liked across the continent for his business acumen, which has and continues to be a template for many other business start-ups.

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Mike Adenuga - Nigeria
Adenuga's wealth is estimated to be around $4.3 billion - but this figure has been debated by his aides. Adenuga amassed his substantial fortune through business interests in telecommunications, banking, and oil.
The 58-year-old is appreciated across the African continent for turning Globacom, his telecommunications holding company, into a global giant. Today, Globacom operates in four African countries, and is rated as one of the fastest growing multi-national carriers in the world.

Outwardly a calm and reserved individual, Adenuga is said to have had made his breakthrough in business by selling traditional clothes made of Nigerian lace. He is also said to have benefited under the regime of former Nigerian leader Ibrahim Babangida, who awarded Adenuga contracts to execute huge infrastructural projects.

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Patrice Motsepe - South Africa
The 49-year-old Motsepe is worth an estimated $2.5 billion. He is said to be South Africa's first and only black billionaire. His wealth is largely derived from mining.

Motsepe trained as a lawyer, but later went into mining, buying unprofitable mine shafts and turning them into revenue-generating ventures.

Having benefited from South Africa's Black Economic Empowerment (BEE) laws to secure mining licenses, Motsepe saw his stock rise substantially over time.

Last year, he was rated the 10th richest man on the continent, out of a list of 40 put together by Forbes.

SOURCE: howzit.msn.com