After receiving such a great response to Dr. Stamp's guest blog post on estimating a potential market size I thought it would be a nice treat to ask Dr. Stamp to write another guest post. This one is particularly important, and often missed when an entrepreneur is seeking an investment from investors. Hope you enjoy!
Guest post by Dr. Jeffrey Stamp.
It happened again last week, I was listening to an entrepreneur’s elevator speech to an angel investor’s team and the entrepreneur spent the entire 5 minutes giving a product sales pitch. Needless to say, the investor tried to coax information from the entrepreneur, but to no avail. The entrepreneur didn’t understand what the angel investor wanted and so insisted on trying to ‘sell’ him on his product. This is a common situation that needs to be understood when you are developing your plan presentation or even your 60 second elevator speech.
What most entrepreneurs fail to appreciate is that the pitch isn’t a place to sell – it is a place to ask. A pitch is where you are asking for something in exchange for an equity position in your new venture. It is more than a selling transaction, you are literally asking for a long term financial and business development relationship. The key is developing trust through transparency about what is going on with your venture and what you will need in order to accomplish your visions of the future. Remember, at the pitch, most investors (or judges) will assume you’re an expert, so the tech or expertise content isn’t the most important element of the pitch. You can greatly increase your probability of success with the judges if you show them how you arrive at your decisions about the opportunity rather than the discussing product content.
Said a different way: resist the temptation of saying “we have spent the past 6 years developing a way to make a great electric bicycle that everyone will want because we really know electric bikes.” (I actually heard a student group at an east coast university say this.) Instead draw a complete venture picture around your 6 years of hard work as in: “our approach to the electric bike revolves around superior battery life and lightweight yet rugged design that will allow the urban cycling commuter to ride a full two hours at an average speed of 25 mph between charges. We have sold 15 bikes to date and need an investment of $125,000 to expand our manufacturing ability to meet the order demand we see over the next 12 months.”
So get your ask in gear, by focusing your pitch on asking for an investment that would accelerate your new venture to capture your awaiting opportunity.
Sunday, March 21, 2010
Tuesday, February 2, 2010
How to Estimate Your Market Size
A guest post by Dr. Jeffrey Stamp at Bold Thinking
My goal with teaching and working with entrepreneurs and education is to help entrepreneurs prepare their mindset and their position for investment. As we work together, we make sure that their new venture has the ability to be heard, be understood, and ultimately be able to attract the investment they need. The post below details one of the most common flaws I see with entrepreneurs seeking investment.
I call this “Opportunity to Market Match.”
Every single business plan considers an opportunity, the market that opportunity will enter, and the potential market estimate. The golden question is: How much of that market do you think you can actually get? In other words, the market you can actually attain as compared to the market that you can see is there?
The reason this question is described as golden is that it is the gateway question to the investor’s billfold. If you aren’t prepared for this question or worse, prepared incorrectly for this question, you will find yourself exiting the room stage left quicker than you entered stage right.
Typically, this is what happens:
Investor: “So what is YOUR estimate of your market potential?”
Entrepreneur: “The entire U.S. market size is X. We just have to capture a conservative 10% of the market in order to start turning a profit.”
Anyone can get 10% of any market right?
No. What you have just witnessed is the prototypical top-down market assessment technique blow up in the entrepreneur’s face. The biggest mistake entrepreneurs make is they predict sales they can never practically achieve (and worse no supportive operations plan to match it)- investors see it and don't stand for it.
Investors are not interested in overly aggressive sales forecast numbers. They are interested in how you got to those numbers. Investors know that they don’t enter a nationwide market immediately, so assuming that you can is presumptuous and naïve.
If you try to boldly state you need to capture X% of the market and your venture cannot produce that much, your company is undercapitalized. If your revenue projections were based on a large market, your profit estimations were overstated as well. Now you have double trouble – unrealistic high hopes for sales and not enough capital to support the infrastructure, which rapidly dries up cash flow.
Opportunity to Market Match
A better way to match the opportunity to the market is to figure the size of a realistic bottom-up assessment of the available market you can penetrate. In other words, match your opportunity to your operations capacity in order to figure out your revenue projections.
Figure out your production capacity (how much can you make/how many can you serve) as a basis of what you will optimally have available to your customers. From there, give a plan for distributing and selling that available production (which is a whole other topic).
This bottom-up approach gives you a much more credible argument for substantiating your revenue projections. It also ignites confidence in your potential investors that you have the capacity to continue being the CEO of your new venture.
My goal with teaching and working with entrepreneurs and education is to help entrepreneurs prepare their mindset and their position for investment. As we work together, we make sure that their new venture has the ability to be heard, be understood, and ultimately be able to attract the investment they need. The post below details one of the most common flaws I see with entrepreneurs seeking investment.
I call this “Opportunity to Market Match.”
Every single business plan considers an opportunity, the market that opportunity will enter, and the potential market estimate. The golden question is: How much of that market do you think you can actually get? In other words, the market you can actually attain as compared to the market that you can see is there?
The reason this question is described as golden is that it is the gateway question to the investor’s billfold. If you aren’t prepared for this question or worse, prepared incorrectly for this question, you will find yourself exiting the room stage left quicker than you entered stage right.
Typically, this is what happens:
Investor: “So what is YOUR estimate of your market potential?”
Entrepreneur: “The entire U.S. market size is X. We just have to capture a conservative 10% of the market in order to start turning a profit.”
Anyone can get 10% of any market right?
No. What you have just witnessed is the prototypical top-down market assessment technique blow up in the entrepreneur’s face. The biggest mistake entrepreneurs make is they predict sales they can never practically achieve (and worse no supportive operations plan to match it)- investors see it and don't stand for it.
Investors are not interested in overly aggressive sales forecast numbers. They are interested in how you got to those numbers. Investors know that they don’t enter a nationwide market immediately, so assuming that you can is presumptuous and naïve.
If you try to boldly state you need to capture X% of the market and your venture cannot produce that much, your company is undercapitalized. If your revenue projections were based on a large market, your profit estimations were overstated as well. Now you have double trouble – unrealistic high hopes for sales and not enough capital to support the infrastructure, which rapidly dries up cash flow.
Opportunity to Market Match
A better way to match the opportunity to the market is to figure the size of a realistic bottom-up assessment of the available market you can penetrate. In other words, match your opportunity to your operations capacity in order to figure out your revenue projections.
Figure out your production capacity (how much can you make/how many can you serve) as a basis of what you will optimally have available to your customers. From there, give a plan for distributing and selling that available production (which is a whole other topic).
This bottom-up approach gives you a much more credible argument for substantiating your revenue projections. It also ignites confidence in your potential investors that you have the capacity to continue being the CEO of your new venture.
Monday, January 11, 2010
How to Make Every Sales Attempt Successful - The Next Step
Human beings tend fear a lot of things – death, change, aging, clowns… well perhaps I just fear clowns... (something about a painted smile and that movie "IT"). But another big thing we humans fear is the ‘c-word’ COMMITMENT. It is this fear, and this fear alone, that one has to be able to negate when it comes to big-ticket sales.
Think about any big purchases you might have made in the past and I am sure at least a few of them were a bit scary for you. Why were they scary? More than likely they were scary because you were afraid of making the wrong decision. You were afraid of buying the wrong thing. We are all naturally afraid of committing to something because we are just not sure it will be as good to us as we hope it will be.
I recently bought a flat screen TV. Thoughts kept running through my mind – what if it breaks? Is this the best brand? What if it is too big? How long will it last? What if it breaks? Do I really need 1080 resolution? Will the price go up next week? How can I be sure this is a good deal?
I was a bit scared that my purchase decision would be the wrong one. Most of us are just naturally afraid of being wrong. Most of us are afraid of failing to some extent. What a lot of folks fail to connect is that fear of failure equates to fear of commitment! It is that simple. (My male readers surely understand this one.)
So, when it comes to selling, how can you help to ease that fear of commitment for YOUR customers?
I call it “the next step.” At every interaction point with your customer, you should keep in the front of your mind that next small and easy step you want them to take.
For example, if you are sending an e-mail to a potential customer, you might be tempted to give them a long list of all the things that make you great and all the wonderful things you’ve done. Somehow, your amazingly written self-description will sell this person on your services. You truly believe that their reply will be a resounding “YES” to your company’s services or products.
But, it doesn’t usually work that way.
The most important thing to remember in sales is this ‘next step.' What is that first and easy next step that you want your customer to say yes to? Is it a visit to your website? Perhaps it is a phone call to discuss their needs? Maybe it’s a chance for you to visit their job site so you can walk them through some free recommendations?
If the guy at Best Buy told me – “Tell ya what, take the TV home and try it out. If you don’t like it, we’ll take it back – no questions asked. We’ll even deliver and install the TV for you at no charge. If you don’t like it, here’s my number – call me and we’ll come pick it up and bring you a check for your money. Can we stop by one evening this week?”
I guarantee you that Best Buy would sell a lot more big ticket items if this was case. Chances are, I would like the TV and probably listen to recommendations from the installers for enhancing my TV experience and go back the next day to purchase surround sound!
Asking for a simple and easy next step is key to building and closing sales. You have to make it EASY for them to say yes.
You don’t offer a marriage proposal on a first date. Sales are no different.
Think about any big purchases you might have made in the past and I am sure at least a few of them were a bit scary for you. Why were they scary? More than likely they were scary because you were afraid of making the wrong decision. You were afraid of buying the wrong thing. We are all naturally afraid of committing to something because we are just not sure it will be as good to us as we hope it will be.
I recently bought a flat screen TV. Thoughts kept running through my mind – what if it breaks? Is this the best brand? What if it is too big? How long will it last? What if it breaks? Do I really need 1080 resolution? Will the price go up next week? How can I be sure this is a good deal?
I was a bit scared that my purchase decision would be the wrong one. Most of us are just naturally afraid of being wrong. Most of us are afraid of failing to some extent. What a lot of folks fail to connect is that fear of failure equates to fear of commitment! It is that simple. (My male readers surely understand this one.)
So, when it comes to selling, how can you help to ease that fear of commitment for YOUR customers?
I call it “the next step.” At every interaction point with your customer, you should keep in the front of your mind that next small and easy step you want them to take.
For example, if you are sending an e-mail to a potential customer, you might be tempted to give them a long list of all the things that make you great and all the wonderful things you’ve done. Somehow, your amazingly written self-description will sell this person on your services. You truly believe that their reply will be a resounding “YES” to your company’s services or products.
But, it doesn’t usually work that way.
The most important thing to remember in sales is this ‘next step.' What is that first and easy next step that you want your customer to say yes to? Is it a visit to your website? Perhaps it is a phone call to discuss their needs? Maybe it’s a chance for you to visit their job site so you can walk them through some free recommendations?
If the guy at Best Buy told me – “Tell ya what, take the TV home and try it out. If you don’t like it, we’ll take it back – no questions asked. We’ll even deliver and install the TV for you at no charge. If you don’t like it, here’s my number – call me and we’ll come pick it up and bring you a check for your money. Can we stop by one evening this week?”
I guarantee you that Best Buy would sell a lot more big ticket items if this was case. Chances are, I would like the TV and probably listen to recommendations from the installers for enhancing my TV experience and go back the next day to purchase surround sound!
Asking for a simple and easy next step is key to building and closing sales. You have to make it EASY for them to say yes.
You don’t offer a marriage proposal on a first date. Sales are no different.
Saturday, January 2, 2010
Top Three Tips for Naming Your Company on the Internet
As the New Year begins, it is reflection time for all of us. I also reflected a bit and as you may notice, my blog has a new name: TLC for Start-Ups – TLC standing for Tough Love Coaching. I actually made the switch because I took my own advice (or didn't take my own advice until now).
I intended to write a follow up post to ‘Does Your Company’s Name Suck?’ that went on to explain common faux pas if you will in naming your company. This is especially relevant with the Internet issues now at play. This post focuses on issues specifically related to the Internet.
By Internet issues I mean domain names, e-mail extensions, etc. Company names now need to take into account what their name looks like (or turns into) when you remove the spaces between the words. I've put together three simple rules to for naming your company in the digital age:
RULE ONE: Be careful with apostrophe names if you must use them.
EXAMPLE:
I actually saw this (Seriously, I really did.) – if I remember correctly it was the name of a carpooling network for parents in North Carolina that I saw on a billboard.
Kid’s Exchange: Turned into a URL and you get: www.kidsexchange.com
Do you see it? Kid Sex Change . Yep, there it is. I don’t have much else to add. Except be sure you show your name to at least 15 people who have never seen it before prior to purchasing the domain.
RULE TWO: Avoid butting the same letters at the end or beginning of your company names.
EXAMPLE:
Business Solutions: Turned into a URL and you get: www.businesssolutions.com
Not only does it look weird: how many ‘s’ are there? Three? Two? It is odd to type, read, and just plain look at. Personally, I want to hiss this word aloud when I read it – like a snake. Bussssinesssssssssolutionssssss… Ok, maybe I’m alone on this one.
RULE THREE: Make any name of your company easy to spell.
Sure, there are obvious words no one can spell. The bane of my existence has always been entrepreneurship. It took me a good year to spell ‘entrepreneurship’ without thinking twice, and I looked at the darn word EVERY DAY.
But there are less obvious words in the English language that can plague even the most adept Internet searcher.
EXAMPLE:
Sea Tours and Leisure: Turned into a URL and you get: www.seatoursandleisure.com
Seems pretty harmless huh? Well, did you know that leisure is one of the 100 most commonly misspelled words in the English language? It violates that annoying ‘i before e except after c rule.’ Annoying, but true.
So in this example, potential customers are probably going to misspell the company’s name. Granted, you can do a URLs for every possible misspelling that could occur and create misspelled keywords to solve this problem. But I ask you, why even have that problem if you can avoid it? Keep your clients feeling smart by only making them spell easy words only.
Check your company name here at the full list of the 100 most commonly misspelled words.
So, after writing this post, I realized that I failed to take my own advice. Yes, I know ME WRONG? Heaven forbid! But I have to admit – I knew the name was hard to spell when I picked it: Millennialland – the previous name of my blog. Double letters, hard to spell, weird to look at… yep, I had all the errors. But, like so many entrepreneurs, I was in love with it regardless of how easy it was for everyone else to understand. Sound familiar?
So, for 2010, I’ve renamed my blog to TLC for Start Ups. And yes, you can get to it at www.tlc4startups.com AND www.tlcforstartups.com. So – I guess we have rule four – if you use a double word/number word: to=2, for=4, etc. get both URLs!
Here's to an entrepreneurial 2010!
I intended to write a follow up post to ‘Does Your Company’s Name Suck?’ that went on to explain common faux pas if you will in naming your company. This is especially relevant with the Internet issues now at play. This post focuses on issues specifically related to the Internet.
By Internet issues I mean domain names, e-mail extensions, etc. Company names now need to take into account what their name looks like (or turns into) when you remove the spaces between the words. I've put together three simple rules to for naming your company in the digital age:
RULE ONE: Be careful with apostrophe names if you must use them.
EXAMPLE:
I actually saw this (Seriously, I really did.) – if I remember correctly it was the name of a carpooling network for parents in North Carolina that I saw on a billboard.
Kid’s Exchange: Turned into a URL and you get: www.kidsexchange.com
Do you see it? Kid Sex Change . Yep, there it is. I don’t have much else to add. Except be sure you show your name to at least 15 people who have never seen it before prior to purchasing the domain.
RULE TWO: Avoid butting the same letters at the end or beginning of your company names.
EXAMPLE:
Business Solutions: Turned into a URL and you get: www.businesssolutions.com
Not only does it look weird: how many ‘s’ are there? Three? Two? It is odd to type, read, and just plain look at. Personally, I want to hiss this word aloud when I read it – like a snake. Bussssinesssssssssolutionssssss… Ok, maybe I’m alone on this one.
RULE THREE: Make any name of your company easy to spell.
Sure, there are obvious words no one can spell. The bane of my existence has always been entrepreneurship. It took me a good year to spell ‘entrepreneurship’ without thinking twice, and I looked at the darn word EVERY DAY.
But there are less obvious words in the English language that can plague even the most adept Internet searcher.
EXAMPLE:
Sea Tours and Leisure: Turned into a URL and you get: www.seatoursandleisure.com
Seems pretty harmless huh? Well, did you know that leisure is one of the 100 most commonly misspelled words in the English language? It violates that annoying ‘i before e except after c rule.’ Annoying, but true.
So in this example, potential customers are probably going to misspell the company’s name. Granted, you can do a URLs for every possible misspelling that could occur and create misspelled keywords to solve this problem. But I ask you, why even have that problem if you can avoid it? Keep your clients feeling smart by only making them spell easy words only.
Check your company name here at the full list of the 100 most commonly misspelled words.
So, after writing this post, I realized that I failed to take my own advice. Yes, I know ME WRONG? Heaven forbid! But I have to admit – I knew the name was hard to spell when I picked it: Millennialland – the previous name of my blog. Double letters, hard to spell, weird to look at… yep, I had all the errors. But, like so many entrepreneurs, I was in love with it regardless of how easy it was for everyone else to understand. Sound familiar?
So, for 2010, I’ve renamed my blog to TLC for Start Ups. And yes, you can get to it at www.tlc4startups.com AND www.tlcforstartups.com. So – I guess we have rule four – if you use a double word/number word: to=2, for=4, etc. get both URLs!
Here's to an entrepreneurial 2010!
Saturday, December 12, 2009
Five signs that you are a small business owner and NOT an entrepreneur
I sent out a Facebook update a few weeks ago and it got a surprisingly large and positive response. I also Tweeted it this morning to see what came back. It seemed to me that it might be worth writing about. The update was this:
I believe that if you experience just a few moments where you know that you are doing what you are supposed to be doing in life - you've won.
At first, I didn’t think this fluffy, gushy, and mushy statement was even close to being profound. But one of my brilliant thought partners who has a great blog on finance pushed me to explore it a bit further.
It turns out that the essence of entrepreneurship is what that statement is all about. In fact, it is the starting point of what makes the difference between a small business owner and an entrepreneur. Have you ever considered whether you are a small business owner or an entrepreneur? A lot of people haven't.
In my experience, there are five key signs to telling the difference between a small business owner and a true entrepreneur. And I’ll tell ya, investors and customers can spot the difference just as easily. Here are the five signs that you are a small business owner and NOT an entrepreneur:
1. You don’t get excited about your customers.
Customers are an entrepreneur’s lifeblood. They represent everything from cash, to credibility, to just plain proving the entrepreneur is good at what they do. True entrepreneurs know that when a customer comes into their life, they’ve got one shot and it better be perfect. Oh, and when it is perfect, it feels REALLY good.
2. You don’t like talking about your company.
We used to have a rule at the entrepreneurship center I ran. The rule was when an entrepreneur called; we did not ask them about their company, we found out what they needed first. It simply took up too much time to learn about every entrepreneur’s story. Sure, once we figured out what they needed, we made the appointment and they had the chance to tell their story – but not until it was the scheduled time to do so. Entrepreneurs are in love with their company and want everyone else to be in love with it too. A simple request like, “So tell me about your company,” led to 20 minutes of listening on the phone – MINIMUM.
3. You get defensive when a customer complains.
The best customer is one who gives you feedback about their experience. Any entrepreneur should be hungry for that feedback. If a customer tells an entrepreneur that their website is hard to navigate, they will be sure to ask lots of questions to understand how to make it better. They won’t tell the customer they are stupid or worse yet, wrong. Entrepreneurs are always looking for ways to improve.
4. You don’t see the bigger picture.
Entrepreneurs are all about growth. Here’s an example. If you are running a dry cleaning shop and have no interest in dreaming about how your shop can change the way the dry cleaning industry, you are just a small business owner. There is nothing wrong with that. Its just a fact. An entrepreneur would question the practices and business models of dry cleaning and constantly think about how to make dry cleaning more effective, the process of dry cleaning more efficient, the impact of dry cleaning greener, or even just less expensive. Entrepreneurs want to change the way things are typically done and they aren’t satisfied until they do.
5. You don’t find meaning in what you do.
This ties it all back to the quote I started this blog with. Entrepreneurs are those wonderful people in the world that believe they are in the world to make something better for someone else. They also strongly believe that what they are doing is worth enough for someone to pay for. Entrepreneurs create a meaningful value exchange in the world. They are also smart enough to build a sustainable business around that value exchange. And they never stop trying to build it.
So, after reading this, if you find that you are indeed an entrepreneur, I take my hat off to you and applaud your efforts. And the next time someone calls you a small business owner, feel free to correct them.
I believe that if you experience just a few moments where you know that you are doing what you are supposed to be doing in life - you've won.
At first, I didn’t think this fluffy, gushy, and mushy statement was even close to being profound. But one of my brilliant thought partners who has a great blog on finance pushed me to explore it a bit further.
It turns out that the essence of entrepreneurship is what that statement is all about. In fact, it is the starting point of what makes the difference between a small business owner and an entrepreneur. Have you ever considered whether you are a small business owner or an entrepreneur? A lot of people haven't.
In my experience, there are five key signs to telling the difference between a small business owner and a true entrepreneur. And I’ll tell ya, investors and customers can spot the difference just as easily. Here are the five signs that you are a small business owner and NOT an entrepreneur:
1. You don’t get excited about your customers.
Customers are an entrepreneur’s lifeblood. They represent everything from cash, to credibility, to just plain proving the entrepreneur is good at what they do. True entrepreneurs know that when a customer comes into their life, they’ve got one shot and it better be perfect. Oh, and when it is perfect, it feels REALLY good.
2. You don’t like talking about your company.
We used to have a rule at the entrepreneurship center I ran. The rule was when an entrepreneur called; we did not ask them about their company, we found out what they needed first. It simply took up too much time to learn about every entrepreneur’s story. Sure, once we figured out what they needed, we made the appointment and they had the chance to tell their story – but not until it was the scheduled time to do so. Entrepreneurs are in love with their company and want everyone else to be in love with it too. A simple request like, “So tell me about your company,” led to 20 minutes of listening on the phone – MINIMUM.
3. You get defensive when a customer complains.
The best customer is one who gives you feedback about their experience. Any entrepreneur should be hungry for that feedback. If a customer tells an entrepreneur that their website is hard to navigate, they will be sure to ask lots of questions to understand how to make it better. They won’t tell the customer they are stupid or worse yet, wrong. Entrepreneurs are always looking for ways to improve.
4. You don’t see the bigger picture.
Entrepreneurs are all about growth. Here’s an example. If you are running a dry cleaning shop and have no interest in dreaming about how your shop can change the way the dry cleaning industry, you are just a small business owner. There is nothing wrong with that. Its just a fact. An entrepreneur would question the practices and business models of dry cleaning and constantly think about how to make dry cleaning more effective, the process of dry cleaning more efficient, the impact of dry cleaning greener, or even just less expensive. Entrepreneurs want to change the way things are typically done and they aren’t satisfied until they do.
5. You don’t find meaning in what you do.
This ties it all back to the quote I started this blog with. Entrepreneurs are those wonderful people in the world that believe they are in the world to make something better for someone else. They also strongly believe that what they are doing is worth enough for someone to pay for. Entrepreneurs create a meaningful value exchange in the world. They are also smart enough to build a sustainable business around that value exchange. And they never stop trying to build it.
So, after reading this, if you find that you are indeed an entrepreneur, I take my hat off to you and applaud your efforts. And the next time someone calls you a small business owner, feel free to correct them.
Thursday, November 26, 2009
Does your company name suck? Take the ‘Ten Word Test’ to find out.
The name for your company is about as important as the company itself. It is normally the first encounter anyone has with your company. As the old saying goes, you only get one chance to make a first impression. But your company name may be the only impression you get to make if your company’s name sucks. And I have to say, there are a lot of names out there that do.
I’ve noticed a trend among novice start-up acts; they love to have fancy sounding names that communicate absolutely nothing. They put their name alongside a word like “Group” or “& Associates” or “Consulting” and suddenly they are a high-powered CEO of a company. Their business card gives them permission to believe that their you know what doesn’t stink. Well it does stink!
So, I thought it would be fun to put on the fancy CEO suit for a moment and imagine myself as a new entrepreneur choosing a fancy sounding name for my start up. Take a look at some examples I’ve created for myself: Colleen Post, founder & CEO.
Do any of these tell you anything about what I might do? No.
Do any of these tell you what I might specialize in? Nope.
Do they make you a bit more inclined to learn more? No way.
Do they tell you why you might need my company? Absolutely not.
In fact, the only thing that these names tell me about you and your company are that you are either one of two things: inexperienced or egotistical.
So, let’s do a test of YOUR company name. Take a look at this list of ten words and then take a look at your company name and see how many of these words you find:
If you have two or three of these words in your company name – you should probably scrap the whole name and start again.
And if you have more than three of these words in your company name – e-mail it to me, I’d love a good laugh.
I’ve noticed a trend among novice start-up acts; they love to have fancy sounding names that communicate absolutely nothing. They put their name alongside a word like “Group” or “& Associates” or “Consulting” and suddenly they are a high-powered CEO of a company. Their business card gives them permission to believe that their you know what doesn’t stink. Well it does stink!
So, I thought it would be fun to put on the fancy CEO suit for a moment and imagine myself as a new entrepreneur choosing a fancy sounding name for my start up. Take a look at some examples I’ve created for myself: Colleen Post, founder & CEO.
Associated Enterprises, LLC
Strategic Solutions Group, LLC
Post Strategic Alliance, Inc.
Post Consulting & Planning, Inc.
Innovative Business & Solutions, Inc.
Strategic Solutions Group, LLC
Post Strategic Alliance, Inc.
Post Consulting & Planning, Inc.
Innovative Business & Solutions, Inc.
Do any of these tell you anything about what I might do? No.
Do any of these tell you what I might specialize in? Nope.
Do they make you a bit more inclined to learn more? No way.
Do they tell you why you might need my company? Absolutely not.
In fact, the only thing that these names tell me about you and your company are that you are either one of two things: inexperienced or egotistical.
So, let’s do a test of YOUR company name. Take a look at this list of ten words and then take a look at your company name and see how many of these words you find:
- Business
- Solutions
- Consulting
- Enterprises
- Strategies/Strategic
- Planning
- Group
- Innovative
- Associated
- Alliance
If you have two or three of these words in your company name – you should probably scrap the whole name and start again.
And if you have more than three of these words in your company name – e-mail it to me, I’d love a good laugh.
Thursday, November 5, 2009
I want to start a company. Should I get an MBA?
If I had a nickel for every time I was asked this question, I would have about $5.
“I want to start a company. Should I go back to school and get an MBA?”
My answer is always this:
An MBA could do several things for you, such as:
GETTING AN MBA CAN HELP YOU GET A BETTER JOB.
Getting an MBA will not help you start a company; in fact, it will probably deter you further from starting your company. Here’s why:
Here’s a typical example:
I have a good friend who wants to start a bakery. He has a great line of recipes from his grandmother and really wants to start a hip little bakery in a cute, urban neighborhood. He currently works in the entertainment industry. He asked me if he should go back to school because he has no business background. I told him, instead of wasting $25K on a degree, take that $25K and support yourself so you can work at a bakery for six months.
Yeah, he thought I was nuts too.
But here is the hard truth: If you want to start a company in an industry – you need experience in that industry. That experience will help you:
However, there is another less drastic option available. A great company concept was featured in Entrepreneur Magazine called Vocation Vacations. This company is focusing on just this issue. I am a big fan of this company. It’s a great way to test out an entrepreneurial venture before you decide to bet your house on it.
In my friend’s case, he can go be a baker for a three days and work along side the owner and learn what a day in the life of running a bakery is actually like. Anyone who tries this strategy out is likely to find that there is a big difference between what you think a day of an entrepreneur is like and what a day in the life of an entrepreneur is REALLY like. Just ask one.
The cool part is – you will have found out what you like and what you DON’T like, without ruining your credit.
“I want to start a company. Should I go back to school and get an MBA?”
My answer is always this:
An MBA could do several things for you, such as:
- Introduce you to a new group of business networks who could help you get a new job or a new sale
- Increase your salary at the current company you work for or increase your asking salary when you look for another job
- Allow you to use the career services of the school to help you find a new job
GETTING AN MBA CAN HELP YOU GET A BETTER JOB.
Getting an MBA will not help you start a company; in fact, it will probably deter you further from starting your company. Here’s why:
- An MBA will cost a minimum of $15,000 to attain – that takes away from possible start-funds you may have available
- An MBA will take up a minimum of 10 hours of your time each week – that takes away from time you could spend starting your business
- When you get the MBA and get a promotion – that’s more incentive for you to stay in your job and not start that business
Here’s a typical example:
I have a good friend who wants to start a bakery. He has a great line of recipes from his grandmother and really wants to start a hip little bakery in a cute, urban neighborhood. He currently works in the entertainment industry. He asked me if he should go back to school because he has no business background. I told him, instead of wasting $25K on a degree, take that $25K and support yourself so you can work at a bakery for six months.
Yeah, he thought I was nuts too.
But here is the hard truth: If you want to start a company in an industry – you need experience in that industry. That experience will help you:
- Gain credibility from everyone from your investors to your parents
- Help you uncover the problems in the industry that your company can solve
- Develop the networks you need in the industry to build a company
However, there is another less drastic option available. A great company concept was featured in Entrepreneur Magazine called Vocation Vacations. This company is focusing on just this issue. I am a big fan of this company. It’s a great way to test out an entrepreneurial venture before you decide to bet your house on it.
In my friend’s case, he can go be a baker for a three days and work along side the owner and learn what a day in the life of running a bakery is actually like. Anyone who tries this strategy out is likely to find that there is a big difference between what you think a day of an entrepreneur is like and what a day in the life of an entrepreneur is REALLY like. Just ask one.
The cool part is – you will have found out what you like and what you DON’T like, without ruining your credit.
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