Category Archives: Entrepreneurship

Is It Stupid to Ask for a Better Email Address?

Business Mistakes, Current Affairs, Web/Tech, , ,

He asked me about my business plan review, something I like doing, and that I charge for. I should be happy, right? And forthcoming? 

bigstock paranoia boy in tin hat

But his email address is three letters having nothing to do with his name, plus three numbers, at yahoo.com (like nnn###@yahoo.com). So I asked him, before sending a work sample, to give me a better email address or identify himself better. 

Am I off base? Is that stupid? Like blowing off a potential client? 

On one hand, maybe this person just doesn’t want to use real email because he (or she) doesn’t want me to spam back. I get that. Nobody I know likes to give an email address to the wrong person.

On the other hand, from my side, it feels like I’m corresponding with, even sending information to, somebody who has a generic name and generic email address, a complete throwaway address. There’s no web footprint at all. 

What do you think? 

And too bad, too. Right? That it’s dumb to just trust? And who trusts first: Him (or her) or me? 

Highest Paid CEOs in Charity

Business Stories, Nonprofits,

The infographic here about the highest paid CEOs in non-profits seems useful to me for two reasons.

First, many people seem uncomfortable with non-profit organizations, serving higher social goals, paying market-level compensation to employees. In my years of dealing with students of entrepreneurship there was an assumption that people who work in non-profits earn less than their counterparts in the rest of business. I question that assumption. If the non-profit is funded by donors, doesn’t it have to pay fair rates to keep good people? Do its employees have to be donors as well, in the sense that their salaries are below market rates?

Second, aside from compensation levels for all employees, looking at the CEOs and what they earn (in this infographic), is there a top end to this that goes to far? Should organizations funded by donations pay their leaders salaries like the ones in this infographic? Maybe they have to in order to get the right level of leadership? 

What do you think? 

The Highest Paid CEOs in Charity
Source: BestMSWPrograms.com

Do You Underestimate Time for Tasks You Like?

Business Mistakes, Management

Damn! I just did it again. Even after 30+ years running my own business I still underestimate time for tasks I like, and overestimate time for tasks I don’t like. 

bigstock-pocket-watch-on-old-paper-back-12357476.jpg

I like writing, and I like programming, which is definitely cool because that’s how I built a business. But when I look ahead, trying to schedule my time right, I end up consistently underestimating the time it’s going to take to post on a blog, develop an ebook, or write a column; and the time it’s going to take to redo one of my WordPress sites or work on one of my newer product development projects. 

That makes it hard to manage my time. 

Do you do this? Or is it just me? 

(Image: bigstockphoto.com)

Can You Guess the Happy Customer/Angry Customer Equation?

Business Mistakes

bigstock-businesswoman-in-grey-suit-scr-44408110.jpg

Time flies. It’s a couple of decades ago now that while I was consulting with Apple Computer I absorbed that culture’s belief that an angry customer tells 20 people while a happy customer tells three. 

I’m certain those numbers are no longer valid. Technology changed them. 

Today, it’s like this: happy customers tell a few people, and angry customers tell the whole world. 

It gets worse. Happy customers tell a few people, and one in a thousand posts up some praise, which nobody believes because it reads like selling. But 6 of 10 angry customers post up complaints, and everybody believes complaints.  

So you tell me: what’s the business lesson here? 

(Image: bigstockphoto.com)

Q&A revisited: Really, How Do I Sell My Idea to a Big Company. Part 2.

Business Ideas, , , ,

Irony: This post from about a year ago explains why you can’t sell an idea to a large company, and recommends not even trying. And dozens of reader comments ask how to do exactly what the post itself says they shouldn’t even try. And I get more comments all the time, plus emails on my ask me form, asking how to sell the idea to the big company.

Pot of Gold shutterstock.com

So I give up: Please promise me you’ve read this post before you go on. Know what you’re up against. Don’t be naive. Selling an idea to a big company is a one-in-a-million shot. You are probably wasting your time. But if you insist, here are my suggestions.

Step 1: Develop idea ownership

  1. Drill down on whether or not your idea is patentable. Patents are for inventions, not ideas. You either consult an attorney or do the research yourself. It’s a tough subject because it’s not what you think it should be, it’s what the real world and the beaurocrats do. And having a patent isn’t enough; it has to be a good patent, that protects against work-arounds, and will hold up in court. And a patent is something you can own. And sell or license.
  2. If you can phrase your idea as a creative work then you can protect it with copyright. That’s for books, songs, recorded performances, software products, films, television shows, paintings, and so forth. That’s protection, and ownership, but it doesn’t mean you can prevent people from copying you. If it’s good, they will.
  3. The other way to own an idea is to build a company over it. We call this general are one of trade secrets. It’s like the classic secret sauce. You bottle it, sell it, and hope imitators can’t reproduce it. So you can approach that target big company as a business already selling something, instead of just an individual with an idea to sell. Yes, that takes work; but your odds of success are much better.
  4. It won’t hurt to periodically write your idea down on paper, describe it as best you can, and mail it to yourself by certified mail. Do that whenever the idea changes. If you do, then at some future date, if you’re in a dispute, you can open that registered and sealed mail in front of a judge to prove what your idea was when. But don’t trust this protection very much: having an idea first doesn’t mean you own it.

Step 2: Get an attorney you trust

You need an attorney. (Note: I’m not an attorney; I can’t give you legal advice; I’m sharing my non-attorney experience as a business owner). Although non-disclosure (NDA) and confidentiality agreements are slim protection against big companies, it’s still better to have them than not to have the protection they offer. And an attorney you trust.

Step 3: Approaching the big company

I have to admit, I can’t tell you how to do this; I’ve never heard of anybody doing it successfully.

In theory, companies have some system for managing these contacts. Visit their website, call their main phone lines, investigate and explore. I do know that companies vary widely in how they deal with suggestions. Some have web forms. Some have employees. Some have a wall that’s hard to penetrate. And maybe there’s some that sift through ideas with interest and respect.

Often, finding the right person to talk to within a big company is like a reverse telephone tree. You start calling phone numbers available. With each call you make, you ask who’s the right person to talk to. With each new person who puts you off, you ask for another suggestion.

Step 4: The great beyond

If you find yourself actually dealing with that big company, pitching your idea, wow, I’m impressed; and you’ve already done the impossible. I hope you have a good attorney. I hope you succeed. My advice is be extremely skeptical and extremely cautious.

Business Plan Yes, Comprehensive and Detailed, Not So Much

Business Mistakes, Business Planning, , ,

Funny how sometimes what sounds like good advice isn’t. I was browsing online when I caught the alleged business plan tip shown here (although I added the red circle over it). It says you should write a “comprehensive, detailed business plan.” And I say probably not; only in special circumstances. 

business plan tip, business plan, agile and flexible

Instead, develop a streamlined, flexible, agile, lean, just-big-enough business plan and use it as the start of a forever-after business plan process. 

Set a schedule to review it and revise it at least once a month. Understand that it gets obsolete in weeks. 

Keep it on your computer where you can refer to it easily and keep it up to date. 

Focus on metrics, accountability, priorities, strategy, without a lot of text. For example, don’t ever write text describing your company or management team in a plan that won’t be read by anybody outside your company or your management team. That’s a waste of time. 

Of course you should know your business, your team, your strengths and weaknesses, and your market. That’s absolutely essential. But do you take the business time to describe it in comprehensive detail, with edited text, statistics and formal research? No. Not unless you have to communicate it to outsiders. If you’re jumping through hoops for a bank or investors, then maybe there’s an underlying business value to the extra description. 

But this kind of hype about big scary masters-thesis-weight business plans does a disservice to all the real business people out there who could use business planning to manage their business better — set priorities, develop accountability, move forward strategically — who unfortunately put off planning because of the mythology of the big formal document that feels as inviting as a high-school term paper. 

It’s business: Form follows function. If you don’t know why you need a comprehensive, detailed business plan document then you probably don’t. But don’t let that off-putting tippery keep you from using business planning to manage your business better. 

(Note: I posted this on Huffington Post this morning)

Quiz: Can a Business Fail While Profitable?

Business Financing, Business Mistakes, , , ,

I’ve posted here before on the problem of survivor bias and how hard it is to identify causes of business failure. Where do you find the people who failed? Do they tell you the truth? Do they even know. 

bills confusion istockphoto

In Are These Three Critical Threats Weeks Away From Sinking Your Business? on tweakyourbiz.com, post author Janine Gilmour interviewed 300 people about their business failure. That seems like a good start. A good interview might be able to get into real causes. 

The first cause: profits aren’t cash. Janine writes, specifically: 

About 60% of the businesses I reviewed were profitable when they failed, but they were upside down in terms of cash flow. 

Fascinating: “about 60%” of these failed businesses were profitable when they went under. I’d read “more than 40%” in this context sometime in the 1990s. 

Conclusion: watch your cash flow. Those of you with business-to-business sales are particularly vulnerable because businesses normally pay later, not now. Sales in those cases aren’t necessarily money until later, sometimes months later, sometimes never. And those of you who manage products, with inventory, are also particularly vulnerable. You typically spend the money way ahead of making the sale; and sometimes you spend the money without ever making the sale. 

Be careful. Profits aren’t cash. And profitable companies fail for lack of cash. 

(Image: istockphoto.com)

Free the Numbers for Simple Lists and Tables

Business Ideas, Self Promotion, , , ,

This is me giving back, making it up to all the spreadsheet haters. It’s a non spreadsheet: lists, tables, yes; but no formulas, functions, or programming. It just adds the rows and columns automatically. I call it Free the Numbers. 

I’ve been a spreadsheet guy since 1979. I wrote three books on how to use spreadsheets back in the 1980s. I published spreadsheet macros. But I always thought that bulk of spreadsheet use could be simpler, like this new non-spreadsheet. No formulas. Just add to rows and columns. Automatically. 

Project costs, estimates, worksheets, proposals, plans … the world is full of lists and tables. And, while I love spreadsheets, I get it: most people don’t. So that’s what this is about. 

It’s free. It’s easy. Please try it. And if you don’t see the video here, click here for the source on YouTube. Or just go to FreeTheNumbers.com.