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Posts Tagged ‘Small business’

Venture Capital: A Transition in Progress?

April 19, 2013 Comments off

vctreeIs the VC risk profile changing?  That thought came to mind after reading commentary by Kent Bernhard Jr.’s article: “Venture capital gets a serious smackdown in the Harvard Business Review”.  Both articles are great reads.  Bernhard comments on an article in the HBR that makes the case that the VC world is shrinking due to, among other things, not providing an adequate return to its investors.  The article contemplates perhaps the industry is destined to failure – or a change of business models?

I agree with Bernhard in that VC’s will stay and continue to fund in a sweet spot that’s needed in the market.  I also think that the incredible growth in Angel Funding and the upcoming potential for crowd funding plays right into a stronger return of the VC industry.  How could it not?  Now, the VC industry can look across a horizon of companies that either make it or not in development and proving a product to the market.  Thus, I believe the VC market will move up a risk-class and place less risky bets on more proven technologies.  Look out Angels on your Series B, C, or D, rounds.  VC’s will be looking to secure a return for their investors and secure their traditional compensation models.  Until they can’t, but that’s a long time from now.

Even though, the disruption of the financial markets have been tough on all of us, I believe this transition has created opportunities never imagined before – and that’s a good thing for everyone.  Look for even more investing models to emerge in the coming months and years.  Nature abhors a vacuum!

3 Reasons to Write it Down Before Action

March 18, 2013 Comments off

pencilLast week was full of surprises.  Teams converged to address a very sticky, emotional and difficult issue.  No surprise, it also involved money, faulty decisions and blame all around. But, I’m getting ahead of myself.

Due to the complexity of the issues involved, I decided to try to create a factual summary of the past and what led up to the present situation. I presented the timeline to all parties to help us all recast the sequence of events. By trying to remove emotion and script only facts along a timeline, we realized, like a lot of difficult decisions, many people and situations conspired consciously or unconsciously to bring us to where we were.  Reducing the facts to a timeline and having everyone agree on what happened quickly allowed us to move forward with the present challenge.  So, write it down, use the facts and you can gain:

1. Clarity

2. Perspective and

3. Build a reasonable plan going forward

The exercise allowed me to also see there was error with “my team” and “their team” – and once we took responsibility, it opened the door to collectively take responsibility and work together on solving what got us there.  We focused on the problem, not the people.  Try it sometime.

2013 Habits – Do With Discipline

January 12, 2013 Comments off

megaphoneRecently, I was working with a start-up on developing a reporting template to update their investors and Board to ensure their stakeholders were well informed.  It is so important to ensure the communication channel is open to any stakeholder in your business.  It is surprising how many businesses start with the greatest of intentions, have a great opening salvo of communication and then drift off into only communicating when you have to – Annual Meetings, needing money, etc.

It is almost as if business leaders think their stakeholders absorb their business activity by osmosis.  Then, when they do need something, they are frustrated to learn their audience is far from ready to take action because they are struggling to absorb what has happened since the last update.

Stakeholder communication is critical, but not required – until you need something.  Think about making it a habit to communicate and solicit feedback on your progress, on a regular basis.  I guarantee it will help when you need help.

Business Plan or Not? – Definately a Plan

December 7, 2012 Comments off
English: Business Plan Presentation at FSG 2009

English: Business Plan Presentation at FSG 2009 (Photo credit: Wikipedia)

The Accelerators section of the Wall Street Journal proposed the question:  Do new businesses or new business segments need a business plan?  The experts weighed in on both sides of the argument.  Many simply said no:  Too tedious, no one reads it, and the business ends up going in a different direction, anyway.  I get that, but if you read into the content of their arguments against a classic business plan, they also state they get some sort of proposal/presentation when they evaluate opportunities.  So, perhaps the details have changed, but the concept remains the same.  In order to be prepared, you need to plan.  If you don’t know your market size, your customer needs and some sort of idea of what they are willing to pay, your business model and some idea of your operating infrastructure, no inside or external investor will be impressed enough to put money in your concept.

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Three Steps to Know you are Pointed Toward a Successful Initiative

November 12, 2012 Comments off
Steps

Steps (Photo credit: susanvg)

In the last post, I spoke about Passionate Certainty, how do you know your passion and direction align.  Further, how do you take steps to develop an initiative personally or professionally?  To select an initiative, it takes thought and planning to ensure you are pointing your team in the right direction.  There are many layers below these steps, but they are, by nature simple.

  1. Assess – review as much information as possible.  In the start-up world its called market validation.  Who’s in the business, why, is this idea/initiative solving a real problem that people are willing to pay money for?  Does this initiative align with your company’s vision/mission (or your own?).  If you moved forward, what would you consider to be a success metric(s)?
  2. Analyze – drill your assessment into measurable metrics.  It could be features/benefits of the product, customer or expert reviews, or other quantitative or qualitative measures. The important part is to go through the exercise.  Write it up and report it to your team or a reliable peer or expert.  See if it makes sense when you say it out loud and you truly have an initiative that creates value in the mind of your audience.
  3. Act – Go out into the market.  See other products/services in action.  Talk to experts, ask questions.  If you have a demonstration item to present, have them look at it.  If not see if you can assess what your initiative can do to improve productivity or profits.  Do it on a small scale, measure it and determine if you can scale it.

One you “act” make sure it is on a very small scale, measure your success and go back to #1 before you decide to scale the idea.  Did it achieve your objectives, profitably (in your personal world, did it satisfy you and align with your beliefs system?).  If so, we are ready to move to Diligent Pursuit.  If not, a failure at this level is a success. Few resources were spent, and either a pivot strategy was developed, or you agreed to abandon the initiative in pursuit of a more attractive opportunity.

In completing a business development strategy, following these steps ensured our message aligned with our customers.  We assessed the market and its perceptions, analyzed our target customers and acted through interviews to ensure we it our target.  It works with concepts like marketing and products that serve customer needs.

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It’s Not About Perfect, It’s About Progress

September 12, 2012 Comments off

I just returned from one of my most enjoyable roles with the PIPELINE Entrepreneurs organization (By the way, they are accepting applications for a new class – see pipelineentrepreneurs.com).  I work with these high growth business owners to help them communicate their business concept – in plain English – and set and achieve milestones for their business. I encourage them to set goals for their team and themselves that make meaningful progress toward their success.

It seems we sometimes reach a conundrum when we work toward these objectives.  Either we are paralyzed by the size of the task in front of us – and therefore can’t break a big goal into small tasks, OR we get overly focused on the details of the goal – attempting to make it a perfect measurable task to move you closer to your objective.  In either case, I am a proponent of simple progress.  Figure out a way to move in the general direction of your objective and refine your goals along the way.  You just don’t know, unless you get started.  Indeed, it is about progress, not perfect.  Let’s get moving!

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It’s just easier if I….

June 26, 2012 Comments off

This week, my good friend Ross Patterson from XM Performance Business Coaching and Consulting wrote a post I thought was so good, I got permission to rebroadcast it.  Enjoy….

“It’s just easier if I do it myself”

These are dangerous words for leaders in any organization. I work with dozens of owners and businesses every year. When businesses are struggling in certain areas it can almost always be diagnosed down to a people problem, or a process problem (or both).

When owners say “It’s just easier if I do it myself,” they are usually trying to avoid the conflict of holding someone accountable.  Or, they have a process that is perfectly lined out in their heads, and no one else can meet their expectations, because no one knows or understands the expectations.

XM Truth: If it’s just easier to do it yourself, you will have a very small business.

The key to living life on the Xtra Mile in your business is learning to lead by:

  • Building business systems and processes that are not owner dependent
  • Hiring great people and training them to do their well defined jobs
  • Get the heck out of the way and let them do their jobs

Want to know the most powerful words a business leader can say…, “What do you think we should do?”

Listen to yourself this week, what are you saying more?  “It’s just easier…” or, “What do you think?”

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