Archive for category Miscellaneous

Believe in your charity by believing in other charities

Several months ago I was at a meeting for a new non-profit . I was invited there to give my opinion of the whole setup.? They wanted to help farmers in a Central American country however, they had no business plan and it was clear that they need one. I suggested they needed to do a proforma, because at the very least, they needed a plan on how much they were going to give, how much it would cost them to give, and how much they were going to get.? I even offered to do it under my donation program (I do it for a reduced rate and donate 100% of the money minus any out of pocket expenses [there are usually none] to another charity). They balked wondering why I would charge their charity when they were a charity. Why would I not donate my time?? Here is why:

  1. They did not have a real charity, business, or anything. It was a nice idea.
  2. When people are not paying for your time (especially doing a proforma), they do not value it.
  3. My charities exist and have a history.? They also need money since they do not have the sexiness of the big charities.

I might have mentioned this before on this blog, but there is also number 4:

4. If you are in the spirit of donations, why are your charities more important than mine??

a. In other words, if I am working for a charity just like you, then I have to keep my charity in mind as well.

b. Are you not supposed to be in the spirit of giving money??? You are getting people to be in the spirit if giving money, so if you do not?get in that spirit how do you know what it is?

c. Do you believe in your charity ?

4b was expressed today by Seth Godin in his blog. Today’s post is “Watch the money

He says that money is a statement of belief, and the fact that these people would not even put money behind their own idea and in the same vein help another charity, how valid is their cause?

It is not valid.

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Reduce Forms Reloading and Improve User Experience

Have you ever entered information into a form on the web and the page has to go to the server for every line? The wait is forever. It slows things down.

This is versus a form that does not take a long wait but might have to have a long time for setting up.

When you are creating a web site that involves inputting a form, you really have to think about the user experience. This experience will dictate their reaction and whether they say nice things or bad things about your web site.

Plenty of effort is made to make a site cool, provide interesting videos, or even games. However, not enough effort seems to be done on the form entry. I see this especially so on corporate web sites, which are typically not there to entertain, but there to provide functionality.

What I find useful are the following rules:

1. Keep it simple.

2. Minimize page reloads.

3. Use Javascript because it does not rely on the internet connection. I know people are worried about security, but quite frankly if you have a serious web site, that wants to get things done quickly Javascript is incredibly functional. There are some really advanced Javascript methods that allow you to manipulate tables, and data on the screen.

4. Use AJax which allows you to access the server real-time and not have to do page reloads.

5. Test with potential customers and learn how they interact with your system. User experience is key to making a successful web site design. Seems obvious, but too many corporations forget about this.

In a nutshell, poorly designed forms are one of the worst ways to ruin a web experience, and reduce customers. Why? They go somewhere else. Time spent on designing a good form and improving the user experience will improve the overall usage of your site.

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Time is t

Take time to think.

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Real valuations do not include would haves or should haves.

Today, a friend told me about an incident when he was advising on a company acquisition. His employer, the prospective buyer, wanted to buy a billboard company.

The billboard company only rented space. They made $750,000 pee year. Of that, $225,000 was profit. The owner did not make anything else from the company.

The sale price was $5.6 million. My friend said it was a multiple of 8 times revenue.

The reality is that most comapnies $2 million in sales sell for a multiple of three to five times the income of the owner. In this case five times $225,000 or $1,125,000.

Extenuating circumstances that would raise the price would be protected ip or land on which the billboards sat. There was neither.

The owner claimed that it was definitely worth more because he could easily go out and double the income. That is a load of garbage! If it is worth that much then the owner needed to go out and make it worth that much. My thought was that he should not get paid for laisiness.

My friend recommended his client (the buyer) should walk. I agree.

Lessons learned:
Multiplier on owner’s portion is three to five.
You don not add in potential unless it is protected ip and then it depends on a lot of other factors.
If it smells bad then walk. This deal stunk.

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Sleep

Taking care of yourself is as important task as anything se. Part of that task is getting enough sleep. The average person needs seven hours per night to be most productive. Note tht I did not say functional. We want more than just functional. We want results.

I bet those of you that try only five hours or less a night might get more done if you sleep more. Those waking hours become a lot more productive.

They do for me. Which is why I am finishing this now to get my seven hours of sleep.

Good night.

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Focus on what is important

Two trains are traveling in opposite directions. One is travelling at 100 mph, and the other is travelling at 90 mph. If they start at the same point at 12 noon, in how many hours will they be 950 miles apart?

If you ask, What color are the trains? or What kind of food are they serving on the trains? either you are not taking it seriously or you are not focusing on what is important.

Many times people get caught up in the minutia or the wrong parts of the problem and cannot get anywhere. They focus on the wrong parts of the problem. This is primarily due to lack of experience solving these types of problems.? In the problem above an engineer who has experience in basic physics would solve it in about ten seconds. A psychologist who is weak in math may take longer. A seventh grader would use algebra because that is what they are learning.

However, many people do not solve problems at all and would not know how to begin.? They do not know how to set up the problem, ask the right questions, and then proceed on a path to solve it.? The key step is to focus on the right things: the goal, the clues and elements that provide meaningful starting points, and the steps on reaching that goal.

If you do not know how to solve the problem then the key question is: How do I solve this problem? This leads to: Can I find an expert on solving this problem? Now, the task is to find that expert and get it solved.

Focus on what is important: solve the problem and do not get caught up in minutia.

The answer is 5 hours.? The trains are traveling part at 190 mph. Divide 950 by 190 and you get five. All other information about the trains is irrelevant.

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Dollars To the Bottom Line as a Motivator for Change

How do you get someone to change that does not want to change? Have you considered the basic human ideal of “What is in it for me?”
You find out what they want or need or lack and you present that to them as a way of acquiring it if they do the change.
Most companies have annual reviews. In those reviews, they measure performance by accomplishments; and specifically, how that person benefited the company. The best way to demonstrate a benefit is how an action affected the bottom line: money made, money saved, or losses avoided.
If you present a change to a person in how much money they will make for the company (or money saved, or losses avoided) in dollars, and then explain how they can use this metric in their performance review, you often can get them on board as an implementer of your change.
This may seem very direct, but often the direct approach is best. The challenge here is to find out the dollar benefit if your change.

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Part 5 of 5: The Future for Tech Wildcatters

The last four days, I introduced Tech Wildcatter micro-seed project, their program, successful fundraiser dos/don’ts, and elements of their selection process.  Finally, today we look at what they will do over the next few months and their future.  Finally, at the bottom, you can contact them via their blog.

            Gabriella Draney and Jon Feld started Tech Wildcatters. On Sept 3, I had the great opportunity to sit down with Gabriella and talk about her new venture.  I organized her responses into each of these general question categories.

What is Tech Wildcatters doing in the next few months?

            They are fundraising and looking for more mentors and collaborators. 

            They plan to raise about $600,000 and use this to seed the first group of companies.

            For a mentor, they are seeking A-players: someone who has failed and been successful. They know how to do a successful exit.  They are seeking 10 spearhead mentors and as of our interview time had firm commitments from 7 people.

            For collaborators: someone in the B2B space, a potential acquirer of the company, or a potential relationship (whether vendor or customer).

Finally, how do I get in touch with them?

            Stay tuned to Gabrielle’s blog at http://techwildcatters.wordpress.com/.  Their first fund will start running March of 2010, and they plan on starting to accept Applications in December 2009!

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Part 4 of 5: The Startups for Tech Wildcatters

The last three days, I introduced Tech Wildcatter micro-seed project, their program, and some of their philosophy for a successful fundraiser. Today, we look at the startup selection program and how discussed their program for entrepreneurs. 

            Gabriella Draney and Jon Feld started Tech Wildcatters. On Sept 3, I had the great opportunity to sit down with Gabriella and talk about her new venture.  I organized her responses into each of these general question categories.

What types of companies are they looking for?

Tech Wildcatters will target IT professionals: one to two people with a good idea and some prototype. 

What areas of interest?

            In no particular order or priority:

  1. Transportation and logistics
  2. Energy
  3. Retail/Consumer Goods
  4. Education
  5. Real Estate
  6. Travel/Leisure

What stage should the startup be at?

            They would like to do something that has an alpha or prototype already developed but can do a pre-seed company. 

 

Does the product need to be patentable?

            Not necessarily!  The idea is to get early to market, and be best in market. 

What are the characteristics of the team?

            Two or three founders with the skills of business, product development, and designer spread between them.  They need to have the entrepreneurial spirit.

            A big question for them will be their ability to devote 100% of their time to this endeavor. This is not something that can be done in a typical 40 hour work week.  Will their other commitments be manageable? Will their spouse be able to handle it and be supportive?

            Key questions they will consider:

  1. How well have you thought out your idea?
  2. How much have you worked on it?
  3. How dedicated are you, especially when the 12 weeks end?
  4. Can you develop your own product? (If it is going to take 30 programmers, this will not work.)
  5. Can you be in Dallas for three months? (After the program ends, you can be anywhere)

Two or three people?  Why not one? 

Gabrielle described how Tech Wildcatters do not want someone working in a vacuum.  “Companies are not built in isolation,” she said. It is unlikely to find someone that is great in the business, development, and design. With two people, they have the other person who can review their ideas and offer critical feedback. 

What will be their selection process?

Their criteria they are keeping to themselves for now, but the process is fairly simple. They will have three passes. The first will be whether or not the entrepreneurs fit the criteria. Based on these criteria, Tech Wildcatters will select who they will contact.

The second will be an email to the entrepreneurs and their response. See other comments in this article about the biggest mistake being lack of follow-up. If you are applying to be a part of this, definitely return all email as fast as possible.

Finally, they will do phone calls and interviews.  They will narrow it down to 10 to 15 companies for the first group.

             Ultimately, there will be a selection process and it will start soon. They plan on selecting companies starting December 2009.  Tomorrow, I will tell you how to contact them (if you have not already done a web search for the name Tech Wildcatters).

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Part 3 of 5: Tech Wildcatters’ Suggestions for the Successful Fundraiser

The last two days, I introduced Tech Wildcatter micro-seed project and discussed their program for entrepreneurs.  One of the areas of conversation focused around what made entrepreneurs successful at fundraising.   This will give you a little insight into not only how to get their attention but also how to be a successful business person.

            Gabriella Draney and Jon Feld started Tech Wildcatters. On Sept 3, I had the great opportunity to sit down with Gabriella and talk about her new venture.  I organized her responses into each of these general question categories.

What is the best way to stand out from the rest of the pack?

            This can also be looked at, “What is the biggest mistake entrepreneurs do?”  Our discussion actually started on this point first and Gabrielle was quick to respond, “Lack of follow up.”  One would think that at the funding stage the most important action would be to follow up with potential investors, contacts to investors, or with customers. Unfortunately, many entrepreneurs do not do this.

            The best way to be “written off” is to not do follow-up.  Respond to emails. Call back if someone leaves voice mail.  If you do not have the answers yet, at least call back to let them know you received their message and when you can deliver the answers.

 What are some of the other mistakes that entrepreneurs do when they look for money?

            Gabrielle sees a lot of mistakes.  In addition to not following up with phone calls and emails she listed off the following. Start-ups are:

  1. Not thinking about customers and revenue.
  2. Focused too much on raising money and not enough on running the company.
  3. Not being aware of what investors do, not looking at their website, and generally being unprepared for the interview process.
  4. Not being able to strategize. If you have been turned down by too many investors rethink your strategy. If you do not know why you are not getting any money, then get help. 

 Two ideas stand out. The first is that although these points seem like common sense, there are a lot of people are obviously not doing it.  The other is that you need to run your business like your life depends on it.  Balance between making money and raising money.  Stay focused and in contact with people.  Ultimately, standing out is not as much about doing something new and different but more like doing what the successful businesses do.

Tomorrow, we look at what Startups Tech Wildcatters will pursue.

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