Archive for December, 2011

There is no such thing as a ‘final’ business plan…

Posted: December 26, 2011 by Chuck Matthews in Planning, Startup

“It is a bad plan that admits of no modifications.”   – Publilius Syrus (~100 B.C.)

In this fifth of five columns on the value of strategic planning, four additional questions are posed.  These 20 questions comprise a robust outline for a baseline business plan.  While it will enable your business to survive and thrive, make no mistake, there is no such thing as a ‘final’ business plan.  As the quote above from Publilius Syrus’ Maxims suggests, the most fundamental thing about planning is its on-going nature.

Today, the focus is on four core business needs. Managing: Do you have the management team in place to achieve your immediate, intermediate, and long-term goals?  Financing: How do you plan to finance your venture?  Marketing: How do you plan to promote your business? and Having a Back-up Plan: What are your contingency plans?

Managing is a team sport…

While the individual entrepreneur is rightly celebrated as the creative force, innovator, leader, and communicator of the core business idea, they are generally the first to credit their success to their team.  Having the right management team in place is critical on two fronts: the need for multiple levels of expertise and to fuel funding and growth.  When a new venture is just getting off the ground, one person, usually the founder, will wear many hats simultaneously.  It saves expenses and while relatively small, one person can usually get his or her arms around multiple tasks fairly easily.  On the other hand, if a new venture is founded on the need for specific or challenging technology or experiences the need for product and/or service development and more rapid growth, it will quickly exceed one person’s capacity.

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“If you give a man a fish, you feed him for a day. If you teach a man to fish you feed him for a lifetime.” However, teaching a man to fish may not be enough. Bill Drayton, founder of Ashoka, suggests, “Social entrepreneurs are not content until they revolutionize the fishing industry.” This statement raises at least three questions. What is a social entrepreneur? What does it mean to revolutionize the fishing industry? And finally, how is social entrepreneurship expanding in Cincinnati?

Defining Social Entrepreneurship

Social entrepreneurship can be defined broadly as developing innovative solutions to persistent social problems. In this way, social entrepreneurship borrows the creativity and imagination from entrepreneurship, but applies it to address social problems such as hunger or poverty. According to Greg Dees at Duke University, “a social entrepreneur is of the genus entrepreneur and the species social.” In this way, an entrepreneurial mindset identifies opportunities, marshals resources and creates value, but the primarily focuses on the creation of social value – value often for the marginalized of society – rather than private economic value.

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Create Fantastic Customer Experiences

Posted: December 12, 2011 by Bill Cunningham in Innovation, Marketing, People, Startup

Do you remember a really special experience with a business?

Someone or everyone at that establishment created a memory that lingers in your mind long after the commercial transaction has been completed?

You have just experienced marketing aura – you have caught the buzz! The Holy Grail of all marketing strategies is the ability to create an incredible experience that generates more repeat business, more new customers and more profits.

Some very large companies naturally create fantastic customer experiences – Apple, Disney and the Ritz-Carlton all have special memories that their customers share. Small companies can create marketing aura on their own as well.

In Boston’s Faneuil Hall, the infamous Durgin Park restaurant has been asking patrons to pay for their dinners when ordered for the privilege of experiencing abrupt and impolite demeanors of the wait staff.

In any other restaurant, this would guarantee a minuscule tip, yet at Durgin Park, people wait in line to experience the aura of an interesting customer service strategy. They rarely advertise, never run any specials, yet the cash registers keep ringing.

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Startup Genome

Posted: December 4, 2011 by John Clarkin in Ecosystem, People, Startup

Ge-nome (noun): all the inheritable traits of an organism.

 When the word genome is used to study humans, it includes all of the genetic information inside and outside the nucleus of our cells, and all of the hereditary material related to our organism.  In Greek, genome means, “I become, I am born” or “to come into being.”  The word came into use in the 1930s as scientists began to study genetics and the set of human chromosomes in an attempt to crack the code of human evolution.

Earlier this year, a group of Silicon Valley researchers took this scientific approach to entrepreneurship in what they called “The first step in cracking the innovation code.”  They examined the drivers of entrepreneurial performance, looking at 650 young Internet companies for patterns in successful startups.  They looked for answers to the question “What makes Silicon Valley startups successful”?

The Startup Genome Project tracked startups moving through a lifecycle of four initial stages:

  1. Discovery: In this stage, startups determine whether they are really solving a meaningful problem and whether anybody is interested in their solution.  Events include founding team formation, value proposition formulation, creating viable products, friends and family financing, and the first mentors & advisors come on board. Startups typically spend 5-7 months in this stage.
  2. Validation: Startups get validation that people are interested in their product through the exchange of money or attention. Events include refinement of product features, revenues realized, seed funding secured, first key hires made, and validation of the product market fit is established.  Most startups spend 3-5 months in validation.
  3. Efficiency: In this stage, startups refine their business model and improve efficiency in their customer acquisition process. During the 5-6 months most spend in this stage, startups refine their value proposition, overhaul their user experience, achieve viral growth, and discovery of repeatable sales processes and scalable customer acquisition channels.
  4. Scale: This stage is where startups step on the gas pedal, and very aggressively drive growth.  Events include “A Round” financing, massive customer acquisition, back-end scalability improvements, first executive hires, and process implementations over an average 7-9 month time frame.

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