We didn't know we were born.

We're looking to raise more now to really get the ball rolling, build the team, improve the site, spread the word, that sort of thing. We need more this time, more than an individual investor (often referred to as an Angel) would be comfortable putting up but not enough to prick VCs' ears. 

I read Paul Graham's article a couple of days ago and it had an incredible effect - I didn't feel alone, that we were approaching this in the wrong way, or that Raffle.it was a silly idea. Paul Graham is a partner a Y Combinator now and has a great deal of experience with new start ups.

I urge you to read it irrespective of whether you are trying to raise money yourself (if you are and haven't read this, you absolutely must - it will keep you sane). It will give you a greater understanding of the journey most new entrepreneurs have to travel before you ever see the fruits of their labour.

http://www.paulgraham.com/fundraising.html - enjoy.

A new start up called Rmbr allows you to quickly send your business card via text message.  No more costly business cards and it's good for the environment.  If the person to which you send your "bzCard" also uses rmbr, you will receive their bizCard back instantly.  Sounds great.  Yet, I doubt the general public will pick up on this and make it truly as useful as it could be.  Then I read the cool part.

Rmbr is smart.  Your bizCard can have links to your LinkedIn, twitter, Facebook (etc.) profiles, allowing them to one-click add you to these networks.  You can opt to send a bizCard to your computer to be automatically put in your Outlook contacts.  Awesome.  You can also add a link to your blog, information about your company's products and services, and a picture of yourself, if you'd like.  Have you met someone and after asking for their phone number, you have to go through 20 minutes of looking them up on 5 different social networking sites and you are not sure if it would be awkward to friend them so soon?  Rmbr does it all for you.  I'm ON BOARD.

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Your technology should work seemlessly with  common existing technology

Most organizations use Microsoft Office, Internet explorer and Outlook/Lotus Notes.  Your technology should work seamlessly with the existing technology to not only make the IT transition easier, but also makes it easier on the user

Let your technology "hide" behind existing technology

It is sometime hard to tell someone who has been documenting process for 10 years "you now must do it on a wiki...and oh yeah, feel free to use html".  You are going to grind work to a halt.  Allow users to stay within the technology they know.  Altissan has a new release that allows users to update their wiki page in Word - and publish it back on the wiki all the time staying in Word.  Or, RSS feeds in your e-mail client.  This allows users at first to stay in the technology they are comfortable with to begin.

Single sign-on integration

Does you technology allow it to partner with internal IT for single sign on?  The introduction of social media is sometimes fragile...having user try to remember yet another password can turn them off and have them never return.  Once they are into their day, they should be able to seamlessly login on to their social network with no problem

Strong Reporting

Whether they actually use them or look at them, enterprises love and require reports for their technology.  Robust reports!  If your technology cannot easily spit out number of visits, page view, articles, etc by user name, time then you have lost some potential clients.  Oh yeah, and reports should be a push of a button away (both numerical and graphical).  Manually compiling information will not cut it. 

Cost

Yes, this is important.  In times of cutting costs and maximizing resources, this will come later...but i very important.  No more need be said.

Ease of use

At the end of the day, the enterprises have employees with different ages, skill sets and attitudes.  If it is is hard to use, looks ugly or takes too much time (vs value), then forget it.  It will be one more piece of technology that peters out...an no-one notices.

Can be small and big - but if possible, you should have it all

Enterprises sometimes do not need everything.  They may need a wiki to start...an expert directory in 6 months and a discussion forum 6 months after that.  Allow your technology to be sold in pieces when required...or have the whole suite available (for a cheaper price).  Let then ease into it before giving them everything.  And, if your technology is only wiki...have a partner that does what you do not do so when they are looking for the next piece of technology, you can recommend one that work well with your technology,  you have a relationship with and have past implementation successes.

Search functionality

Enterprises have information overload.  When your technololgy is running, it should be able to search all of what is out there.  If it is there, but people cannot find it, it might as well not be there.

That's it for now.  Feel free to add anything that I missed or dispute anything I listed.

1) Business Ideas

2) A youthful perspective on business issues and starting a buiness

3) Poor Grammer and speeling (though not that bad)

4) A pinch of tech, fashion, music, sports...

5) I also like to talk about things that don't make sense

I have been fascinated with small businesses, start-ups, marketing and web traffic for years now, and have dedicated a large portion of my time learning as much as a can about these subjects.  I have learned that I am still a student, as is everyone else, and I am just trying to soak it all in.  The key is finding out what to soak in.

Yep

Enhancing the bottom line is one answer, it can provide additional opportunities for saving significant tax money.

Protecting your assets and business from liability is another answer and generally  creating opportunity for additional strategies as events occur, a third benefit if not a reason.

Here is what I am talking about.

If you are a manufacturer, it may be beneficial to hold all the expensive, depreciating, equipment in one LLC and put the operational side into another LLC. This way the employee base, were most liability exposure exists, is separated from the asset base, were most of the valuable assets will be held. This provides a few opportunities.

First as we all know this is a very litigious country. You are bound to be sued for something somewhere along the way. You may owe someone money or one of your employees may commit some breach, even an auto accident or a breach of contract, and since the operation is what will be out in front whom your employees work for, it will be sued and the equipment held by a separate entity and leased to the operation entity is out of harms way and not exposed to the law suit.

The operation can probably be run at break even since you can control the lease fee for the use of the equipment and other inter corporate exchanges and thus the operational entity is for all practical purposes judgement proof. By keeping your valuable assets out  of harms way in a separate LLC so you can fend off law suits with less concern and worry and expense, as there is little to gain in suing an entity with no real value. Its your operation that will cause law suits not your equipment, seperate the two with two legal entities and you will protect them both.

Further we can reduce payroll taxes for the owners by having them receive rental fees from the operational entity which are not taxed as payroll and thus more valuable. Since the rental fees are associated with a depreciating asset which may also have a note and thus incur interest deductions, we are also sheltering the revenue received for rental by the deduction of the depreciation and interest expenses,  insurance, and maintenance and repair and thus the revenue remains at a much lower tax base and may even be tax free depending on the circumstances and numbers. 

Furthermore, based on the profitability of the operation we can move the revenue to the entity were the greatest expense may be by increasing or decreasing management draws by the owners, withdrawing profits were they do us the most good and cost the least amount of tax. It allows us to move expenses to which ever entity they will work the best for us.

Another area of strategic opportunity is in the area of sale, merger, partnerships, stock, etc. By having two entities and a split of operations from equipment (or real estate), we can omit partnership involvement in one entity or the other, we can sell one operation and retain the other, we can refinance the equipment without being concerned about the operational effect on a loan application as we can store losses in one and assets and revenue in the other. This is a good way to handle investors by placing them in ownership were the assets are.

By creating two entities that you control, we can increase your tax advantages, we can protect the valuable assets from exposure to operational liability, we gain strategic advantages and flexibility in partnering, sales and mergers, financing and other strategic opportunities.

It costs a bit more to administer two entities but in the long run it is probably well worth the expense as the gains, opportunities and protection are very much worth the effort and additional expense.  

Talk to your accountant about this, if he balks, get another accountant.

If your accountant has not already recommended this organizational format get another accountant.

In a search for peers to work with (and share frustrations) I keep an eye out for other education focused start-ups. Unfortunately in the UK there seems to be a problem: either I am rubbish at finding these companies, the start-ups are great at hiding or there are just not that many out there.

The market for Education in the UK is massive - there are 26,562 different schools in the UK, and 157 universities and classroom based learning is only part of the picture. There is also adult education, distance learning, workplace training and many qualifications that could be thought of as niche, but have high enrolments each year. On top of formal education there is informal education that is best represented by language learning and the “Dummies guide to” range of books.

Read the full article here

Running an effective business is not a God given secret, known by few and quietly shared with a select group who can afford to pay large sums for such support ( larger business). There is a definite path, a way and if followed will yield a productive, successful profitable business organization, and I am here to share the way with all who want to do better.

Running a business profitably is a process that can be learned. It requires basic business management organization and implementation knowledge and skill which can be taught.

I have been fortunate to have been trained in such procedures and strategies and understand how to best implement a business plan. I have opened and run over 54 businesses so far ( more to come) and have learned in the trenches of small business hand to hand combat, what works and what doesn't work while solving difficult business problems and building profitable organizations.

I have had the privilege of assisting hundreds of small business owners navigate their difficult business problems and build profitable organizations, teaching them the way.

Along the way I have also had the advantage of having some great tutors, business professionals who knew what to do and taught me.

While I continue to offer my services for hire to the small business owners all over the country,  offering advice and information to any business owner searching for answers and who want to improve their skills and increase profitability, sucess growth and evelopment, or solve difficut business problems.

My blog is of course free to anyone who wants information,  I am now bringing the science of how to run a business to those who desire to improve in a 6 week seminar series entitled:

                                          Small Business Management: Onward rhrough the fog, How to do it.

The fee is $10.00 donation per evening ( $60.00 in all) to be given to the local Chamber of Commerce in Northampton Massachusetts, the location of the course.

The goal is to take existing small business owners and give them the business management technology they require to elevate their business profits and increase success.

I am doing this with an outstanding young business owner who knows more then he realizes, Karl Tur,age 23, partner in the Ink Solutions LLC, a business located in Amherst and Northampton MA, providing re-manufactured ink jets and toner cartridges to the community. 

Together we will provide a basic course in how to succeed in the small business arena.

I invite all to attend, you will learn much you can use immediately. There is a way to improve your business profitability and success.

Call me at 413-687-8388 for further information and to reserve a seat, space is limited.

ticle from StarTribune --

St. Paul Central grad Jawed Karim talks about launching start-ups, being an entrepreneur and Silicon Valley.

Many university students spend summer break painting houses, backpacking through Europe or spending some quality time with Madden 08. Jawed Karim is scouring the Twin Cities for the next YouTube.

The St. Paul Central High School graduate and a co-founder of the popular YouTube video sharing website recently launched Youniversity Ventures, a firm that provides venture financing to Internet software start-ups by college students and first-time entrepreneurs.

Karim, a 29-year-old Ph.D. student at Stanford University, is believed to be worth tens of millions of dollars or more. He is a founder of online payment processor PayPal, which eBay acquired in 2002 for $1.5 billion. Four years later, Karim received $65 million in Google stock when the Internet giant bought YouTube for $1.65 billion.

He started Youniversity last year with Kevin Hartz and Keith Rabois, two Stanford grads and partners at Sequoia Capital, the high-powered Silicon Valley venture firm that invested in Google, Apple, Oracle and Yahoo. The three men will invest $50,000 to $300,000 of their own money per company. To contact Karim, e-mail him at jawed@youniversityventures.com.

Karim chatted with the Star Tribune about first-time entrepreneurs, taking risks and why people in Minnesota need to get out of the convention center and into the coffee shop.

Q Who is Youniversity Ventures targeting?

A We feel that the [college student] segment is underaddressed. There is not a lot of attention given there, even though there is a lot of innovation coming out of that space. People may be working on something that is very useful but they may not know how to take and translate that into an actual business. There are [venture capitalists] but they serve a segment that is a little bit higher up. If you go to a VC, you are expected to have a fully polished business plan.

We want to be involved in a much earlier stage. We act as almost co-founder for the first six months. We just enable the team to get off the ground. ... We work on a very informal basis. We will coach people along if it falls into our area of interest [Internet software], even though we don't make an investment. We are working with a lot of companies right now, even the ones we are not investing in.

Q How did you become an entrepreneur?

A It's very difficult to get started. The best advice I can give is to learn by example. I was surrounded by other successful entrepreneurs. And I did a lot of reading.

Pick a company that you admire and find out everything about it: who's behind it, how they got started. For me, the companies were FedEx, Best Buy, Oracle, Microsoft, Yahoo, Google. I just knew everything about how they got started. I was just trying to emulate the companies I was interested in.

Q What's the difference between being an entrepreneur in Silicon Valley and in Minnesota?

A Silicon Valley has a lot of noise, a lot of hype. People are very excited about all of the Facebook stuff, Facebook applications. It's just been a huge hype over the last year when actually ... there isn't really that much value. It's just a bubble. It's almost a distraction.

Whereas here, there is certainly less activity. But at the same time, you don't have these bubbles of nonsense out here. Things here seem a little too formal. I think that it's inhibiting productivity.

People in Silicon Valley will just get together and shoot around some ideas or program something together. Here, we have to go to a specific conference to meet people.

Q It seems that people in Minnesota are much more risk-averse than in California. Why?

A It's a cultural issue. In California, you see everyone taking lots of risk. So comparatively to them you are not taking that much risk by doing a start-up because everyone is doing it. Whereas here, when you do a start-up it's like: "Oh, my God! Like, I'm doing a start-up. No one else I know is doing a start-up, so I am taking a lot of risk," when actually you are not but it's compared to everyone else. The local culture might discourage risk.

Q What will it take to spark innovation in Minnesota?

A In Silicon Valley, what really helps is that people are always working together. You see people hanging out all of the time. Even people from competing companies are talking about stuff. It's that interaction that creates the motivation to do something. Here people are more separate. They don't interact as much.

What it'll take is much closer collaboration in a much-less-formal environment. But in Silicon Valley, people network all of the time -- on the street, coffee shops, dorm rooms, garages.

A number of corporations in the USA have  also followed his lead and are now amongst some of the most profitable well run corporations in America. 

Here are the 14 points, and the 5 diseases to avoid, that are the heart and soul of the Deming management method. Read, learn and do, We are all way behind and need to catch up.

Recall that the keystone of the Demings management method is all about constant quality improvement which yields lower cost, lower pricing and better products as well as happier long term employees and long term business success.

These are the principles which must be followed to yield the results.

1. Create constancy of purpose for improvement of product or service. Rather then just making money  the        goal must be adjusted to achieve long term business success, creating more jobs through innovation            and constant improvement.

2. Adopt a new philosophy. Americans are too accepting of poor quality, we must reject mistakes and low         quality as being unacceptable low standards.

3. Cease dependence on mass inspection. Quality comes not from inspection and rejection but with                 improved quality production. Eliminating the cause of defects, is far more important then eliminating the     defects, once made.

4. End the practice of dong business with suppliers based on price alone. Its quality and a long term                 relationship not price alone that counts.

5. Improve constantly and forever the production and service system, this is not a one time goal.                       Management must constantly look for ways to reduce waste and improve quality.

6. Institute constant training. Teach employees how to do their job well. 

7. Institute real leadership. The job of a supervisor is to lead, helping people do a better job.

8. Eliminate fear. Employees are afraid to ask basic and important questions for fear of being wrong or             revealing that they do not understand the process or procedures so they perform poorly, rather then ask.

9. Break down barriers between staff areas, competing goals that are in conflict, not working as a team             as opposed to solving problems together. They should all be working towards the same goal...

10. Eliminate slogans. 

11. Eliminate numerical quotas. They take into account only numbers not quality, a guaranty of inefficiency         and high cost.

12. Remove barriers to pride in workmanship. People want to do a good job, and are frustrated when they         cannot, often misguided supervisors, faulty equipment, shoddy materials, stand in the way preventing           success. Eliminate these barriers.

13. Institute education and retraining to change the corporate culture and support the changes described.

14. Take action to accomplish the transformation. Everyone must be on board, management and                         employees, to successfully institute the changes discussed above, neither management nor employees         can do it alone without each others support and commitment.

The five diseases:

1. Lack of long range planning, breeds insecurity.

2. Emphasis on short term profits, undermines quality and productivity.

3. Evaluation by performance, merit ratings, or by an annual review of performance. These are devastating,       as teamwork is destroyed, rivalry is nurtured, performance ratings build fear, and leave people bitter             despondent and beaten.

4. Mobility of management, job hopping managers cannot embrace long term goals and cannot implement       the changes required if they are hopping from company to company.

5. Running a company on visible figures alone. The most important figures are unknown and unknowable,       like the value of a happy customer.

These are all huge concepts that require intensive review, discussion, understanding and yes deep systemic change in the heart and soul of our business leaders, managers and employees as we have all been doing it the wrong way for many decades and the bad habits are now deeply ingrained in our corporate culture.

We as small business owners have the opportunity to change directions and recast the mold.

Because we are small, we can make changes faster, fewer people are involved and communicating and implementing the changes described are therefore easier to accomplish.

However we must not underestimate the enormous difficulty in successfully implementing such radical change, it will take work and commitment and possibly a longer while then expected, but it is worth it as this model will work far better then the models we are following now.

America must change from believing that it can reduce costs and thus increase profits by cheapening the process as opposed to improving the quality...it seems as though we are doing it backwards now and must turn our businesses upside down to achieve the greatness we once had.

See previous blog entry on Demings most important strategy of all. Scroll down its the last entry.

Much of the materials captured here are from the book called The Deming Management Method by Mary Walton. Buy it, read it, study it, do it. Get the point.

The Deming management method has been controversial for decades and followed by some of the most vibrant and successful corporations in the world yet still challenged by many and finding it difficult to get real traction here in America as it is revolutionary and controversial and somewhat opposite our business mind set. He was all about changing the way management was done in America. He ucceeded in Japan but has had a much smaller impact here in America. We can learn much from his success and the success of those who followed his principles.

A hand full of leading corporations in America are following his lessons to some degree while the remainder of corporate America languishes under a false understanding of what works and what doesn't, making the classic error of sacrificing quality for cheaper and less effective standards believing this is how to reduce costs and increase profit while the opposite is the Deming truth.

Deming believed management style must change starting at the top and questions and challenges the way we work here in America, challenging the leaders of our biggest and best industrial giants to reconsider their approach and change.

He is credited with revitalizing the Japanese industrial machine which resulted in incredibly successful giants, such as Toyota, which was heavily influenced by Deming principles and is perhaps one of the best testimonials for the success of the Deming's theories. 

Here is the heart and soul of the Deming philosophy, a concept which if utilized in America by any business will propel them to greater success, greater profitability, happier employees and management and a longer term existence.

This is the Deming chain reaction:

Constantly Improve quality:

                        1. Costs decrease because of less rework, fewer mistakes, fewer delays, better use of                                         machine time, materials and employees, all of which yield higher productivity>

Which results in:

                        2. Capturing the market with better quality and lower prices, creating greater consumer                                     demand which yields long term business success and provides long term employment and                             more jobs.

Improving quality must be done at every level, at the supply side from your source, at the manufacturing site with better equipment, materials, procedures etc, with your production process, design, etc.

Ultimately customer satisfaction is the key to success and is determined by the level of quality which if always improving will result in long term success and greater profitability or failure and elimination if the customer goes elsewhere because he is not satisfied with your produts or services.

The way we achieve this is not by everyone doing their best which is the current standard in American management theory. If this were actually to happen, everyone would be bumping into each other, bottle necks and delays would be the rule and productivity would plummet downwards, were it is today.

It is a known fact that most small business productivity rates are between 30-40%...awful, and that's with everyone presumably doing their best.

What is important is everyone knowing what doing their best means, what it looks like and how to achieve it, together as a team, with the result being higher productivity and a greater quality production. Then once everyone knows what doing their best means they then apply their best effort to this new standard, a team standard.

Constant improvement is the objective, always satisfying the customer with better product at lower prices because increased quality will deliver this result.

Deming describes 14 points, and 5 deadly diseases which if taken together are the Deming method of management.

I will discuss these fourteen points and fice diseases in the next blog entry, for the moment, cogitate on the revolutionary principle that Deming builds his method on:

Constant increase in quality results in lower costs, greater profits and happier employees, yielding long term success and more long term jobs. Toyota has never laid of an employee for lack of work.

Think about this standard and how it can apply to your business ad then find ways to deliver the Deming method of management. 

I will discuss the how in  the next blog entry entited Demings 14 points and 5 diseases to avoid. scroll forward to see.

Your decisions create your future.  This is true whether applied to your life or your business.  Decisions are the events where an act of your will (your commitment to a specific alternative, backed up by the application of resources to make it so) changes the future that will come to pass.

Therefore the ultimate (earliest possible) leading indicators of your future state are your decisions, at the point of decision.  This is true in every situation, but particularly useful in an entrepreneurial startup or whenever a new strategic initiative may trigger a significant change in direction or focus.  In such cases, the future isn't already written; it can't be projected very well from a trend line based on past performance.  It all hinges on the quality of the decisions being made that will create a new future reality.

If you are considering an investment in a stable business with an operational track record, your due diligence research can focus on past performance, operational excellence and the potential for incremental improvements and growth extrapolations.  If you are evaluating a startup built around a new-to-the-world technology, product or business model, all you have is their decisions; you have to understand what they are thinking, their vision of a yet-to-be-created future.  You need to make visible and explicit the strategic decision baseline that undergirds their business plan.

Most investment opportunities are somewhere between the ho-hum operational case and the disruptive startup, so due diligence should be mix of traditional methods (analysis of past financials, the management team, etc.) and exposing critical future-creating decisions and assessing the thinking quality (assumptions, rationale) behind these decisions.

Most business plans don't expose the real logic (criteria, performance estimates, alternatives considered but rejected, summarized rationale) behind the top 10-20 future-creating decisions that will drive business success or failure.  It takes some digging (interviews, tough questions) to get at this data.  This is where a proven decision pattern like the one I've embedded in my Decision Driven® Strategy web service pays dividends.  Every business has to make essentially the same set of decisions; each decision is a "fundamental question/issue that demands an answer/solution".   Armed with this pattern, you can quickly reverse engineer the decision baseline that is hidden in the business plan documentation, make visible the critical decisions and expose inconsistencies or gaps in their story.  This isn't a gotcha exercise, but the start of a mentoring relationship that creates value.

Speed matters in such situations, so I offer a strategic due diligence service that reverse engineers the strategic decision baseline and roadmap behind a business plan.  It typically takes 1-2 days to analyze a business plan document, map it to the decision pattern and present the findings (top 30-50 decisions and gaps or whitespace in the plan).  These findings can then be used immediately to guide further data-gathering and drill-down efforts; it enables a highly focused and efficient strategic due diligence effort.  By capturing the decision/roadmap baseline within the Decision Driven® Strategy web application, it enables the on-going ability to refine the business plan and proactively mentor the management team one decision at a time.

If you are involved in due diligence research to guide investments in businesses with a high strategic decision content, give me a holler.  I'd love to prove to you how a strategic due diligence jump-start can improve the quality of your investments and accelerate value-creation through decision-based mentoring.

Profitable  Corporate Social Responsibility, oxymoron or real?

We hear much about our corporate social responsibility, which is sometimes considered a conflict of terms.

First it has been our understanding that it s the rule that a corporations sole responsibility is to the stockholders and that  responsibility means it is our job as corporate managers to maximize profits for the shareholders. This we all know and understand as it is deeply rooted in our corporate minds.

However as we continue to grow as a culture, as a society and as a country, we are frequently considerate of those that have less, need help and require additional support beyond which they can provide for themselves.

Corporations have played a significant role in supporting charitable efforts and to many business owners credit, businesses have given much to improve the quality of life for many less fortunate people in our country.

I recently experienced a social responsibility situation with one of my business clients, however this time it was different and not only very effective but it taught me a lesson, I call it profitable corporate social responsibility action. Wow!

My client, an auto body shop, was solicited by a hard of hearing organization wanting to place an intern into the shop for on the job training and possible future employment.

My client was not particularly interested having no idea how he or his business could benefit from this exchange other then providing an opportunity for a hard of hearing student who could probably not contribute much to the business.

However as I read the letter it got very interesting. it told us how the hard of hearing community in the area was very organized and sizable. it further went on to state that whenever such a placement is made and an internship opportunity was created, the organization publicizes this event to the hard of hearing community and they flock to the business buying goods and services, creating a meaningful economic resource for the business to demonstrate their support and thank the business owner for his generous contribution. This made my clients eyes light up and he considered the program anew.

This made me think that there may be many opportunities for business owners to do something that is socially responsible, access  niche markets associated with your socially responsible action and profit at the same time.

Why not create  marketing programs around our socially responsible activities. Identify the  opportunities and then market your “investment”  to the community at large as well as  to the community we are benefitting.  With press releases, letters and word of mouth we will benefit from increased business from both  communities. Those that are not recipients of the social responsibility program but respect our efforts and would prefer to do business with a “do-gooder” business and those who directly benefit from the socialy responsible effort.

By promoting our socialy responsible efforts we could do something productive for the community and reap financial benefits as well.

This may not be as pure as one would like but it gets us closer to the goal faster and more effectively,and allows our significant skill and creativity to be aplied to a beneficial proram...profitable corporate social responsibility.

Why not do the right thing and earn at the same time. This will appeal to both the staunchest conservative corporate manager as well as the most liberal.

I call it profitable social responsibility action programs.

Dove soap just released an advertising program around its socially responsible program conducting 2000 seminars for young girls around the country to help them develop a healthy strong self image and attitude.

This represents a  significant investment and with the additional cost of advertising telling their markets that they are doing this socially responsible program, expecting it will attract many new customers to their product because people  would prefer to do business with a company that cares about their community and helps those needing support, socially responsible actions it is called.

Thus Dove soap anticipates increased sales revenue because of their socially responsible involvement, and their marketing program . Think about it. Try it. Do some good and reap some financial benefits.

It takes an effort, some planning and maybe the profit is less but it makes sense. We as business owners should play a meaningfull roll in our communities and we should be investing in the common good and if it requires us finding ways to do this profitably then we hgave the skills to accomplish this so lets do it, it works, its time, in fact its overdo. 

Key highlights of the report:

Indian software product businesses are now approaching an inflection point in their evolution. The next decade will be a period of disruptive growth for this segment, with the annual revenue aggregate of Indian software product businesses forecast to grow from USD 1.4 billion in FY2008 to USD 9.5 to 12 billion by FY2015.

Leading Indian software product firms have strengthened their product portfolio through steady investments in organic growth as well as through overseas acquisitions, and have reached credible business scale

Of the existing 371 software product start-ups since 2001, over two-thirds have been formed in the past three years – of which ~100 companies have started their operations in 2007 alone. As a result, while the top 10 companies still dominate, accounting for 84 per cent of the segment revenues, there are over 200 midsized companies and start-ups that have started generating revenues and are contributing to its growth.

They have recognized our contribution! We (at ThinkingSpace) started  in April-2007 and its been an active 1 and 1/2 years of pursuing our products (Activeciti, Eventazoo), with positive response coming from the domestic and global market. We have also broadened our scope by providing Product Engineering to our clients (ImIn-TV).  NASSCOM-Mckinsey have further identified this area as 'product-shops'. This comes from a fact sheet related to the report, which can be accessed from their site here.

Opportunity for Indian companies in the product domain

India’s potential to cater to this demand for technology services is demonstrated by the host of global technology majors rushing to establish back-end operations in India. The trend towards offshoring product development services is likely to grow as global ISVs continue to struggle to balance their development priorities and the offshore model proves its effectiveness.

While over 60% of the top global ISVs already leverage India for maintenance services and new product development, the opportunity is further fuelled by entry of focused Indian “product-shops”.

I guess we are 'product-shops' then :) Anyways, I am thrilled to read this report. Finally, there has been a detailed study on the Indian software products business. NASSCOM  is taking active steps to identify this business environment in India. I hope this is first of the many steps to come in recognizing the other aspect of Indian Software Companies (other than IT Services and BPO). ThinkingSpace was started with a vision to be a successful Indian Software Product  Company, and this report just fuels our desire to become one.

(I am still into recording my children's milestones too, so this feels like normal behavior to me. Maybe this post is the business equivalent of a baby book.)

But I still ask the question, "When is this startup real?" Here's a taste of the early days journey:

1. Cali Tran introduces me to a lively entrepreneur, Grant Kornman. Tell him about the opportunity for product introductions--specifically--and commerce--generally--in social media. I am halfway describing a business. He says, "You should do that." I think, "Maybe I should."
2. I go home and do what a designer does...I draw a picture of the idea. Customers, cultural influences, trends, new technology and behavioral opportunities, and a possible solution. I think I like it.
3. The next day I do what an MBA does...I create a rough financial model. It looks like we can make money too.
4. Dan Nova tells me all startups feel like a blob at first. That single thought seems to inspire me to keep going...OK with the ambiguity, again, anew (this is my third startup after all).
5. I visit my son at college and on the plane home read an alumni publication full of interviews with people who started companies. Some of them on fairly thin premises. I write my own "why I want to start a company" list.
6. I carefully, gingerly explain the Daily Grommet idea (though it did not have that name then) to husband Des, Drew Beja , Deb Pine, Dominique Hurley. I tell each of them that it is raw and fragile, and please be honest, but gentle, in their feedback. I think if any one of them had thrown up on it I might have folded. (I chose them carefully, of course. And Des always had veto power anyway.) The response is encouraging. There are offers of investment. That is the first real brick in the foundation.
7. I take the idea to Dayna Grayson, on an instinct that she will "get" it, but be critical. (And clearly I had a predilection for talking to people whose names begin with 'D".) She barely knows me so she has no reason to hold back. She gets it. She spends lots of time over several weeks advancing and challenging my ideas. Des and Drew do too.
8. I cut off all conversations with other companies--I'd been chatting with a few startups about joining their teams.
9. I develop the idea with Dom--who adds lots of "science of marketing" insight, and product development expert Aaron Oppenheimer, who thinks out customer experience, architecture, branding clearly with me.
10. Get introduced to entrepreneur and technologist and social media gorilla, Chris Herot. He takes a couple meetings to absorb Grommet, and begins acting as a de facto advisor.
11. Buy the url www.dailygrommet.com, after buying a bunch of other even more ridiculous and non-starter names.
12. I go to Cyberposium at Harvard and meet the faculty social media guru, Misiek Piskorski. Ask him to be an advisor and he agrees.
13. Dayna introduces me to David Eisenberg of Rakuten (now at BzzAgent) and he offers to be an advisor.
14. I call Jim Rice. B-school buddy, MIT supply chain guru, and partner-to-be. He's in. Second brick. We get going more earnestly on studying small product producers and that supply chain.
15. Take the idea to Dave Cancel...on Rudy Rouhana's recommendation. (Had never met Dave.) Figure Dave will give me good founder advice, CTO stuff, and be critical about my data asset assumptions. He surprises me by actually getting the idea on a deep consumer level--I didn't know his wife has spent her career in this arena, and he clearly pays attention to her work.
16. After an interesting diversion helping a Venrock/Highland seed stage company (where I learn a lot more about venture capital, UGC, digital IP and ownership issues, and getting a seed company to Series A) I get back on track to really start fundraising for Grommet.
17. Have lots and lots of meetings with potential angel investors. 'Nuf said. With the exception of one dreadful NY meeting, uniformly engaging and usually pleasant. (But that one meeting-- what a jerk!! Someone who felt if he personally could not understand something it must not be worthy. Sometimes people are too smart for their own good.) But I am not looking so much for friends as investors, so have to keep talking myself up through these meetings. This was the hardest part, so far. I liked the meetings, but I didn't like not knowing if we had early viability.
18. I spend a lot of time going to social media, VC, technology events. At one point I put "Daily Grommet" on my name tag. No one laughs.
19. VC Nick Beim tells Jim and me that we are working on something big, and we should just quietly make it happen. He predicts people won't understand the idea--it's early--and we should not make it our business to educate them.
20. Meet former VC and entrepreneur Nataly Kogan, and we start a regular breakfast rendezvous to help each other.
21. Get tons of recommendations for startup attorneys. Pick Paul Oakley at Sullivan and Worcester. Love working out the details of incorporation and our fundraising deal. Paul is very clear and wise, and his work makes everything seem more tangible. Third brick.
22. Open a bank account. Shouldn't be, but felt like fourth brick. Something about seeing that check book, even though I only put in $5K of my own money to get it started.
23. I start interviewing software developers, designers, keeping an eye out for budget office space.
24. Go to Nantucket Conference. "Re-meet" Jeff Yolen, who seems taken with the Grommet idea and acts as my wing man all weekend. He turns out to be the James Brown of business networking, so very lucky that he offers to be an advisor.
25. Meet lots of very, very helpful people on Nantucket. Founders, investors. Good people. Continue to get lots of advice and help from several of them.
26. Move out of my home office (I'm going crazy there) and camp out with pal Omar Khudari in his office space.
27. Three business school classmates invest.
28. Meet Bill McCullen through a circuitous route. He and partner Elon Boms, of Launch Capital, make Daily Grommet their second investment.
29. Had had a good response from Diane Hessan a couple months back and she strongly encourages me to submit Daily Grommet to Springboard for consideration for their upcoming ALLTHINGSMEDIA VC forum.
30. Jim completes our round and we are "funded." Fifth brick.
31. Write first check on Grommet bank account. Sixth brick, or at least a stake in the ground. THIS, for me, is the most real moment of the business.
32. Take space at 6 Wallis Court, alongside Pod Design, and Agile Commerce (who are building our online experience). Paint the walls, get visiting Irish friend and IKEA expert Cillian Murphy to assemble all the furniture. Move in. Seventh brick.
33. Make the final cut for ALLTHINGSMEDIA.
34. Recruit Joanne Domeniconi, consumer products rock star, with whom I worked at Keds. She becomes our Chief Discovery Officer. Eighth brick.
35. Dayna introduces me to Emily Lapkin, who has deep content creation and UI experience in our space. She becomes immediately invaluable as an advisor.
36. We have a logo. Ninth brick. Seems a little lightweight to say so, but starting to visualize the business makes it more real for me. Wireframes, screen shots start appearing, with the same effect.
37. Write about Daily Grommet in this blog. Tenth brick.

"It is not the critic who counts: not the man who points out how the strong man stumbles or where the doer of deeds could have done better. The credit belongs to the man who is actually in the arena, whose face is marred by dust and sweat and blood, who strives valiantly, who errs and comes up short again and again, because there is no effort without error or shortcoming, but who knows the great enthusiasms, the great devotions, who spends himself for a worthy cause; who, at the best, knows, in the end, the triumph of high achievement, and who, at the worst, if he fails, at least he fails while daring greatly, so that his place shall never be with those cold and timid souls who knew neither victory nor defeat."...Teddy Roosevelt

As always, some will like it, some will not. Everyone will have an opinion...especially if there is a choice to choose from, then the sides will divide and the battle will begin.

I suggest that every moment of this is pure silliness. It makes absolutely NO difference whatsoever what the opinion is of the half dozen or so people who you are soliciting.  It makes absolutely NO difference what any ones opinion is regarding the likely effectiveness of an ad, or some specific marketing piece. 

The only thing that makes any difference at all, and is the single most important issue, and perhaps the only issue...Does it work? Does it sell or advance the sales process meaningfully? Not I think it will work.  What difference could it possibly make  if everyone "likes" it or does not "like it". Does it move the mountain? This is the only question that requires asking and answering. Find out is the answer. 

Test any advertising or marketing tool or program before any major release.Better yet, test multiple approaches, if possible, and see which one works best. It doesn't take a huge sampling to determine which ad or flyer, or mailing piece, or packaging look or whatever marketing tool you are about to implement, works best, test their comparative effectiveness and see which is more effective.

Follow the results, do not allow your ego to rule. In this case opinions do not count.

This is the way to decide which ad and which campaign you should use.

Following the same logic, another reason to use multiple marketing venues and tools, changing approaches and experimenting all the time and always keying the approach used to be able to measure the results. This further allows you opportunity to refine and experiment determining which tools and approach works best of all and thus deserves more of the marketing budget.

Testing takes time, planning and costs some additional money but is also  part of your advertising and marketing campaign, as its real time and happening so there is no waste involved or large extra costs as you are paying for the same ad space you were going to buy anyways, but providing different alternative art, graphics and/or message.It all works, some works better.

Other then the requirements of designing two approaches for each media tool you are testing and each program you want to consider and compare there are only insignificant additional costs required to test and compare approaches.

This is a small price to pay to be assured that your expensive advertising and marketing campaigns will be well spent dollars and you will bring you the results you want.

Test and stop asking for opinions, even your own is irrelevant. Let the market place tell you what works and what doesn't. Advertising and marketing is too expensive and too important to guess. No what your doing, test the approach before you make a major commitment.

Here at Enerpulse, we’re in full start-up mode, with new technology, a growing customer base, and vast opportunities. However, I’ve been around long enough to know that if our people aren’t involved and informed, the happy customers that fuel our growth will be few and far between.

We hold twice-weekly staff meetings to talk about our successes and problems. Everyone in the company hears what in other companies are often deep, dark executive secrets. And I mean everyone - Rosie in shipping; Tobi from sales; Nathan from product testing; Natalie, our marketing manager…and everyone else who isn't tied up with a crucial customer matter. I ask the “question of the week” taken from our "Knowledge" - 100 questions about Pulstar, which pays $20 for the correct answer. Our CFO pulls the bill out of his pocket right then and there. We all talk about how to solve problems - and we get astonishing results in a very short time.

We reward above-and-beyond effort, right now. Nobody has to wait for their annual review. We do our best to keep everyone informed so they can do what’s best for us and our customers, without having to constantly ask for direction or permission.

Just now scanned the ticket for payment options. Cool.  I can pay at www.brooklinepolice.com  I hit the site and spend two or three minutes scanning every homepage menu item.  Nothing listed that even comes close to a ticket paying option.  A couple fruitless clicks and I was just starting to look for a search box.   (If you want to follow along in my journey, go right now to the site and search for a way to pay tickets.  Don't read ahead.)  Just about to give up, I notice an animated advertisement in the header "Pay Your Tickets Online".  It looked so much like a real, friendly, consumer-directed ad that I did what I usually do.  I ignored it.  Without even knowing I was ignoring it. Ouch.

As a consumer, I want ad-based sites to succeed.  They're the main reason I get good stuff for free.  As an entrepreneur I have the same wish...that ad models continue to provide a platform for cool development work.

In that vein, I met with a startup founder today.  He has a good idea that could actually justify a high CPM ad revenue model.  But here's the thing that is at the heart (and Achilles heel) of those models.  When we are all too busy "doing" stuff online (great post by David Beisel on this), the ads slip right by us all.

Reams of pixels (OK, piles of pixels) have been spilled on the difficulty of assembling enough eyeballs to make real ad money. I've been on the inside of just such an ocular assembly effort, and for the same reason that you pick chocolate when you've OD'd on vanilla, I steer clear of throwing myself at that kind of work these days.

My parking ticket journey just confirmed the choice.

Venture Capital companies fund start-ups which are typically run by inexperienced people with a great or proven idea.      Reading the story How I lost $20M in 18 Months by Alex Muse http://www.texasstartupblog.com/2008/08/04/layerone/, shows a great example.  In the end, when Alex cut back on all the expenses, closed facilities, layed-off employees, they actually turned a profit.  What caused the failure was the need for $100M to fill the final gap.  After the Enron fiasco, it was impossible to get the funds.  You could attribute this to bad timing.   Interesting that the Venture Capitalists would not fund the deal unless it involved the large global vision with leased offices through-out the US from the beginning, so Alex found himself in a catch 22 situation.   Sounds like too much money too soon.

When Boston Markets was doing extremely well, they were able to get funding for a rapid expansion.  In the end they filed bankruptcy because they over saturated the market.  Even now the darling Starbucks is closing locations.    More outlets does not necessarily mean more money, yet Venture Capitalists criteria demands a huge investment.  

Not every deal is as risky, there are technology companies that truly have sound, well-managed organizations that do very well and require large amount of funds.  Many of these do very well.  I think the problem stems from three things.  First, there are too many Venture Capital organizations looking for the next best thing, and consequently everyone is funding the same thing. Second,  the Venture Capital teams in trying to be conservative keep looking to the same old strategies, such as  in the Internet business (there are way too many social interaction sites offering the same thing).  Finally they are willing to put up large funds up front, even if the break even point is not for 5 years.    There maybe some start-ups that are brilliant investments, but how do you know that?    The question is, why are you willing to risk so much up-front?   

I have a start-up business which I envision one day will be the "Starbucks" of divination.  There will be SpellSpace locations all over the world, where people come to interact, have a drink, do free tarot readings, have open discussions and participate in rituals.  No fees for tarot, an open social environment, only pay for food, drinks and ritual items.  This is now available on-line in the Internet http://spellspace.com.  The final web version that includes social interaction and virtual spell rituals will be deployed late 2008.  We have spent only a few thousand dollars and yet already we have 3000 daily visitors with 900 returning daily members.  The interest is huge, we are testing and proving our concept, before we step out in to the big VC world. 

I like to play it safe.  As a Project Manager working on multi-million dollar global projects, in information technology, we always spent lots of time and money in the up-front planning, not the implementation.  It seems to me that Venture Capitalists spend lots of money up-front in implementation.  Consequently trying to fix the products or project, while it's in motion results in three scenarios.  Much more money is spent to try to fix it, scope is cut dramatically to get some of the project complete, or failure and the project is cancelled. 

I am thankful to Brad Feld for his Thoughts http://www.feld.com/blog/, which I am always learning from.  This is all new to me, and I may be way off base, but these are just my thoughts.   At this point, I think I am better off avoiding Venture Capital, and will either take my time with http://SpellSpace.com (it may take 1 more year to finish the websites - another 2-3 years for word-of-mouth to work), or look at Angel Investments/ other loans to get the website done within a few months and get the proper publicity needed to make it successful.    As for the Starbucks of divination... that may take VC, but I am still learning and I will demand we use sound Project Management discipline in the planning and implementation. 

Citation URL:

Formation Date: 2008

Funding Status: Seed ?

Investors: SoftBank Capital?

Founders or Execs past companies: Pivot Solutions, Perillon Software

Industry: B2B web, Sutainability for businesses

Offering Description: a place where business professionals share expertise, challenges and knowledge on environmental responsibility and sustainability.

I hear the jaded comments every day, complaining about whats happening, whats going wrong and deep sincere worry about the economy and its effect on each one of us. I hear the fearand the frustration, in discussions with small business owners, but I seldom here what business owners are doing to adjust to the changing times and thus I fear too many businesses will become statistics and it could have been prevented.

This bad economy is not just a bubble, a cycle that will end and all good will return. Not this time. Its a changing economy.

Fuel will remain high and will get higher in the future for many years to come. This is a reality.

The mortgage market has not seen the worst yet and thus the builders, and tradespeople all involved in the real estate market must consider this a long term issue and do something to adjust.

Heating fuel this winter, especially in the northeast will force many people to the brink of economic destruction which will have a huge ripple effect on the northeastern economy...a bad effect.

In addition while not being spoken about as much, energy intensive manufacturers and retailers will be forced to absorb huge increases in overhead as they see their energy bills double over last year. This will force many unprepared businesses out of business.

Gasoline while a huge expense for commuters is devastating to the trucking industry, traveling salespeople, and other users of fuel in their business. This is not just more expensive but is dangerously expensive to many.

Even the baker, the pizza maker who uses fuel to bake will experience excruciatingly high overhead.

One look at the airlines will tell the story.

Food costs will continue to skyrocket and thus restaurants as well as institutions required to feed their customers will all feel a huge suction of money going out the door as they try and absorb the additional costs. Individuals experiencing this at home will simply spend less elsewhere to compensate, further depressing the economic well being of the country.

The auto industry is being decimated...and on it goes.

No one will escape the  changes and if by some act of fortune and good planning a few do, they will be effected by the damage being done to the rest of the economy by all the individuals who can no longer enjoy discretionary income as more and more of it  will all be dedicated to survival.

Yet I hear no cry for help, no requests for options, no inquiry about alternatives exist, few are asking what can we do?

This may have been typical of so many past cycles and bubbles as many business owners chose to simply wait it out as good times are surely on the horizon again, if we only cut our costs and wait patiently.

Not this time, the times are changing and we as small business owners must also change or become extinct like the dinosaur.

So what can be done ?:

As discussed in many other blog entry's I have written explaining in detail what to do, here is a brief rundown of some strategies you should be considering now.

1. Increase productivity, make more with fewer employees. It can be done in any business. I constantly find the productivity levels run between 30-50% and this is way too low and can be dramatically increased fairly easily.

2. Organize your business so it runs efficiently and effectively with clear plans and defined goals and key indicators monitoring  finance, sales and marketing and operations. Redo the cash flow proforma, see whats profitable and what is not and make appropriate changes.

3. Find a niche market for your goods and service and exploit it effectively creating a unique specialty, you can develop and own. Better competitive position, higher profit, more business. You say you can't? how about the dry cleaner who decided to specialize in zipper repair and gets work from the entire country, or the pizza maker who went organic or uses whole wheat flour, or the builder who builds with a "GREEN" program, or a mechanic who retrofits alternative fuel products for cars, to name jut a few successful efforts I hear about.

4. Train and cross train your employees so you can absorb turnover with less loss.

5. Adapt a key indicator tracking system so you know in advance when trouble is brewing and can adjust further.

6. Please create an internet presence for so many reasons, including the long tail revolution that is occuring (see recent blog entry). This may be the biggest opportunity available to grow within a declining market.

7. Expand or contract, depending upon what your numbers and evaluation tell you, Standing still may be detrimental to your health and well being.

8. Control, reduce or eliminate your debt. Pre-emptive workouts, are worthy of consideration.

9. Reduce inventories, too expensive to hoard.

10. Build cash reserves, I know you have been trying for years, do it now. you may very well need it for critical moves and decisions.

11. Develop a "must have" product or service, which you can continue to rely on providing you an income opporunity.

12. Learn how to market more effectively spending less money. Harvest referrals and repeat business.

13. Fine tune your business so it runs as efficiently as possible in many small ways, collectively resulting in higher profits and lower overhead as well as becoming more bullet proof to recessionary dynamics.

There is much we can do to avert decline. If only we would do it.

Call me if you eed help. 413-687-8388