Successful Startup 101: April 2014 by Tabitha Jean Naylor

Leave the Nest to Start Your Own Company: 8 Signs You're Ready You Are Annoying Your Customers. Do You Know Why? Calculating Your Business’ Available Working Capital Is Your Business Behind the Times? Let Loyalty Be Your Fault The Cure for Self Inﬂicted Complexity 8 Must-Have Mobile Apps For Small Business Owners Use Strategy for Your Small Business – You’ll Be 80% More Likely to Reach Your Goals! 5 Entrepreneurial Lessons from the Medical Field

4 Pitfalls for Middle-Market Businesses and 5 Ways to Avoid Them What Zone Are Your Employees Coming From? Top 10 Things Executives Need to Know About Marketing Automation Advisors vs. Mentors: Whatâ&#x20AC;&#x2122;s the Difference? Customer Experience Controls Business Growth Today New Report: Entrepreneurship May Be Contagious How Many Co-Founders Should Your Startup Have? 8 Blunders in How Leaders Think 10 Signs You Might Not Be Ready to Start a Business

SUBSCRIBE TO SuccessfulStartup101 Magazine

TODAY

Start Your Company

LEAVE THE NEST TO START YOUR COMPANY? 8 SIGNS YOU'RE READY BY MARLA TABAKA

Daydreaming about leaving your day job? See if you fit the profile of a successful entrepreneur--or if you're better off staying where you are.

So, you have a great idea for a business. You believe in it with all your heart. (On your better days anyway.) Furthermore, you are really tired of the 8-to-6 grind. (Hey, didn't that used to be 9-5?) On some days you are absolutely certain that it's time to follow your dream and take the plunge into entrepreneurialism. But on other days the doubt, and yes, even the fear, are enough to make you pack your lunch and trek oﬀ to another day on the J-O-B. Sound familiar? So, what are

these doubts and fears really all about? Do other people feel like this? Sure they do; you are deﬁnitely not alone. Some of the most common uncertainties that keep the would-be entrepreneur bound to his commitments in corporate America relate to the potential loss of ﬁnancial security, fear of failure, fear of success (yes, you read that right), and lack of emotional support. Frankly, if you want guarantees, it's probably a good sign that you are

risk-adverse...and perhaps not cut out to be an entrepreneur. But if you are close to making a decision between the security and familiarity of your day job and depths of the unknown in the world of small business, this may be the check-list you've been waiting for. In his role as a top-level executive, Paddy Spence has helped numerous emerging brands leverage their success in specialty channels, and successfully cross over into mainstream markets. During his 18 years of executive management experience in the natural and organic consumer packaged goods industry, Spence was vice president of marketing at Kashi and created one the natural industry's first market research firms. Today, he leads the way in his own company as the Chairman and CEO of Zevia, a line of zero-calorie sodas sweetened with the natural sweetener stevia. Spence knows firsthand what it is like to make a choice between an existing job and launching a business. "It's important to be aware of what appeals to you most when you make this decision; whether it's the idea of managing a business or building a business," says Spence. "For me, the excitement came when I had the opportunity to build something based on a cause that is significant to me." So with his knowledge of the natural foods market and his personal mission to reduce the quantity of artificial products and sweeteners that people are consuming, Spence set out to build something new. Is it time for you to do the same? Let's take a look at what he cites as the main differences between his new role as a CEO. "Building a business requires an ongoing level of sustained passion that managing and maintaining a business from a corporate

position requires less of," Spence says. "To be an entrepreneur you need to have a tolerance for immense risk and the ability to wear a lot of hats. Inherently in a smaller, emerging enterprise you will be called upon to do the mundane and unexpected. Your bandwidth in terms of functional skills will be stretched much more. So if you want to be a specialist in one thing only, then managing a business via your corporate job is probably what you're built for." So aside from recognizing whether or not you have entrepreneurial passion and ability running through your veins, what should you have in place before saying goodbye to your comfy corporate cushion? Paddy Spence oﬀers some sage advice.

WATCH FOR THE SIGNS: Spence began waking up in the morning thinking about that day's to do list rather than the next three months—or three years. This increasing short-term focus, along with feeling that work-thoughts were an intrusion when he wasn't at work, were both signs to Spence that he was ready to leave his job. He felt that he was maintaining something in his job rather than building something new and exciting. "When I realized that there was an opportunity to jump into a product category that 96 percent of Americans already purchased; that no one had used stevia as a sweetener across an entire soda portfolio before; and that I was already a huge fan of its all-natural sweetening ingredient," says Spence, "I knew it was a perfect match for me!" START WITH PASSION:

Remember, what deﬁnes an entrepreneur is to go beyond thinking about it, ignore the calculated risks and do it.

BELIEVE IN IT: Deﬁne a product, segment, or category that you really believe in and combine it with a business opportunity in that segment. This creates a fertile business opportunity. Stevia is a personal passion for Spence. Because of it he is able to live a completely sugar-free life; as an athlete, that's important to him. Spence took that passion and married it up with a business opportunity; a void in the marketplace. Stevia is a great sweetener and no one was maximizing its full potential—until now.

HIRE A GREAT PR TEAM: Spence suggests

looking for a ﬁrm that has been there before, knows how the bigger companies do it, who the players are, how to leverage opportunities, and how to identify areas where you can improve over your competition. Find PR people who share a passion for your product and can communicate your brand's message naturally.

KNOW YOUR PLAYERS: Spence had a

close-knit team of people with whom he'd worked throughout his career. There was a level of trust and camaraderie that eliminated a lot of the risk for him. "Personal chemistry is just as important as the written track record of an individual," he says. "It's great if you've done a lot on paper but I've never worked with you I don't know if we are going to have a strong work chemistry."

HAVE A PLAN: careful

ﬁnancial planning is critical right up front. "All emerging businesses need capital to grow," says Spence. "Understanding those capital needs and how achieve them is important going into it, as opposed to trying to ﬁgure it out as you go along."

DO YOUR MARKET RESEARCH: Test and learn.

Try things on a small scale. Begin with friends and family and get their input on what they think of your product or service. From there you can go on to larger control tests where you will identify measurable quantitative results and actionable changes you might make in your product oﬀering. "The larger your sample size the more you eliminate bias," Spence says. "Start out with a small group and expand it to get feedback from hundreds or thousands." Today, our customers and retailers, such as Whole Foods, Target, and Kroger, are our test groups.

Keep your branding simple: "You need to be able to tell the story of brand or product without it being a complicated story," Spence reminds us. "For us, our consumer value proposition is incredibly simple: Zevia has zero calories and no artiﬁcial sweeteners, it's all natural. So when I tell people it tastes great, has no calories, it’s all natural and it cost a dollar, that’s a pretty easy sell!"

One of my favorite tidbits from this interview with Paddy Spence is this important reminder: "You are going to learn from your experiences; both good and bad experiences. Regardless of what happens in an entrepreneurial or emerging brand situation, you are going to come out of that experience with more knowledge than when you entered. New risk doesn't make you dumber it makes you more experienced. If you have to go back to the corporate arena, you will be a more valuable employee than when you left."

MARLA TABAKA is a small-business adviser who helps entrepreneurs around the globe grow their businesses well into the millions. She speaks widely on combining strategic and creative thinking for optimum success and happiness. Connect with her @MarlaTabaka and www.inc.com/author/marla-tabaka. *This article was originally published here

YOU ARE ANNOYING YOUR CUSTOMERS. DO YOU KNOW WHY? by Gavin Jocius rom social media to retargeting ads, marketers continue to add new communication channels, and with each one we add the ability to sell but we also increase our ability to annoy.

annoyance we inﬂict in an era of countless digital distractions and information overload.

For example, ask anyone, "What annoys you about technology?" You'll undoubtedly get a quick answer. Ask the same person why they ﬁnd such things annoying, and the answer will not be as clear. Slow Internet connections, repetitive Facebook ads, auto-correct, a portable thumb-drive's inability to plug in the ﬁrst try... these things annoy us, but why?

FUNDAMENTAL ANNOYANCE NO. 1: NORM VIOLATION, AKA MINOR INJUSTICES

If we are going to be eﬀective at our jobs, we need to ﬁgure out how to increase our chances of converting a sale while minimizing the level of

Accordingly, marketers should understand the fundamental causes of annoyance.

Norm violations are actions that are not targeted at you personally, but they violate certain standards that you may have. As NPR science correspondent Joe Palca and Flora Lichtman, multimedia editor for NPR's Science Friday, point out, norm violations are actions that conﬂict with our value systems or "destroy a reasonable expectation."

As attendees of the conference write: It's downright essential to have Wi-Fi for an event such as Blog World. Several bloggers like to live-blog during the conference and there are several others who tweet the highlights of the event to their followers. —Gazalla Gaya When I want to be social online, at a new media conference, I need connectivity. —Lori Richardson The organizers at Blogworld NMX did not intentionally prevent folks from accessing that which helps them earn a living, but in doing so they clearly violated a standard shared by everyone in attendance. Fast Internet at a blog and new media conference is essential. Don't provide it to us, and we are going to be upset.

CUSTOMER SERVICE

Today, our growing reliance on technology means that we have developed certain expectations, and we get frustrated easily with technology when those expectations are not met. In June 2012, the Blogworld & New Media Expo was held at the Javits Center in New York City. Blogworld was a very well-organized and well-attended conference, and the people who put it on did a fantastic job. The problem, however, was their choice of location. The basement of the Javits Center is a concrete maze with very little Wi-Fi. Obviously, if you get enough bloggers into a large enough space and restrict their access to Wi-Fi, people are going to get annoyed—particularly if you don't meet their expectation of fast Internet.

It's downright essential to have Wi-Fi for an event such as Blog World. Several bloggers like to live-blog during the conference and there are several others who tweet the highlights of the event to their followers. —Gazalla Gaya

The same faux pas may not have produced such a high level of annoyance at an outdoor farming expo, for instance, where people's expectations are much diﬀerent. Nevertheless, had the organizers of the conference better understood the needs of their clientele and the restrictions of their venue, much of the negative comments from the event could have been avoided. Lesson: Norm violations are why people get annoyed. As marketers, we need to understand the standards and expectations that our customers have grown accustom to.

FUNDAMENTAL ANNOYANCE NO. 2: (LACK OF) SPEED If you do any marketing online, it is fair to say that your customers have been conditioned to expect a certain level of speed. At a 2011 email marketing conference, SucharitaMulpuru, vice-president and principal analyst at Forrester Research, noted that "47% of consumers expect a page to load in less than 2 seconds." By today's standards, even two seconds is too long. "Two hundred ﬁfty milliseconds, either slower or faster, is close to the magic number now for competitive advantage on the Web," says Microsoft computer scientist Harry Shum. Though expected load-times vary depending on the type of media one is accessing, speed has become a universal expectation for almost everyone online.

At a keynote speech at a software developer's conference while she was still a VP at Google, Marissa Mayer was quoted as saying, "One of the most signiďŹ cant things that Google discovered in its early user studies was that speed mattered more than anything else in generating a 'positive user experience.'" Google's resident speed expert, Arvind Jain, points out that "every millisecond matters" and that subconsciously, users "don't like to wait."

FINAL THOUGHT: THE NEW NORM, A REASONABLE EXPECTATION

You can imagine that sluggish Internet speeds is like having thousands of slow drivers in the passing lane preventing you from getting somewhere on time. We have grown accustomed to arriving at our destination on the information superhighway as fast as humanly possible.

As a marketer, next time someone posts an angry comment on your company's Facebook wall, or writes a bad review, understand that there is a strong chance that you, directly or indirectly, violated a standard that your customer has grown accustom to. In one way or the other, a reasonable expectation was destroyed.

Lesson: Waiting is not user-friendly. Whether waiting for a website to load or to receive a reply to a customer service complaint, customers expect speed. Violating that expectation is a norm violation that leads to annoyance.

We all easily get frustrated with technology. That is because we have grown to accept a new norm (a reasonable expectation) that technology should provide us with countless options but also be fast, intuitive, and easy to use. When things don't operate that way, we get frustrated.

Instead of just taking a reactionary approach, you should consider these six proactive measures to help prevent it from happening again: Be aware of norm violations. Anticipate your customer's ever-changing expectations. Respond quickly when such expectations are not met. Focus less on what annoys customers and concentrate on the root causes (why such things annoy them). Know that norms vary across cultures and demographics, but that there are certain norms that are almost universal, the expectation of speedy Internet being one of them. Know that norms constantly change, and just because something does not annoy your customers today doesn't mean it won't annoy them tomorrow.

About the Author Gavin Jocius is the marketing director for Canvas on Demand, a leader in photo-to-canvas printing. He is also the author of The Age of Annoyance: Managing Our Frustrations With Information Overload. Twitter: @changethecode

Calculating Your Business’ Available Working Capital BY MEREDITH WOOD Working capital is essential to running the day-to-day of your business. Without it, you simply can’t keep the lights on. Determining the amount of capital you have to work with each month is certainly not easy, but it can be done, and it must be done. It’s essential you know how much you have to spend, so you don’t overspend. Therefore, become a pro at managing both your liabilities and assets, giving you a complete understanding of your working capital and allowing you to use this cash to its fullest potential.

MANAGING YOUR LIABILITIES In short, current liabilities are what money your company currently owes people such a suppliers or creditors. It’s short-term debt, all due within the year. In order to pay these liabilities, you have to turn your assets into cash to do so. It’s important you keep watch over these ﬁgures when trying to properly assess your working capital. How do

you go about doing so? It’s all about understanding who you owe money to, and when it is you owe them this cash.

1 2 3

First, start by always having reminders set in your calendar of when your payments are due. Make sure the reminder is set not only for the day of but also at least a week in advance, giving you enough time to prepare payment. Be diligent about getting those payments in on time. If you owe multiple payments to a speciﬁc lender, be sure to specify what a payment is for. If you are struggling with your cash ﬂow (or you simply forget a payment date), be sure to start a conversation with your creditors about it. When you keep this sort of relationship with your lenders, it will let them know you aren’t ignoring the debt and can sometimes lead to them being more accommodating. On that same note, if cash is tight, ask your lender if you can send a post-dated check that can be cashed in thirty days. Some will be ok with this. Just be sure the check doesn’t bounce, as this will take away the opportunity to do this in the future.

MANAGING YOUR ASSETS Your current assets are any cash your business has or anything else you can expect to convert to cash. Examples of these assets are: 1. CASH OR CASH EQUIVALENT Currency and deposit accounts. 2. RECEIVABLES - Any money you are waiting to receive from customers for a product you have old or a service you have provided. 3. INVENTORY - Any goods your business has in stock. Be aware there are different types of of inventory. For example, your first type of inventory is materials and components. These are the items that are needed to make the finished product. The second is progress inventory, and this refers to partially completed items. The third type of inventory is finished goods. These are any final product ready for purchase. 4. SHORT-TERM INVESTMENTS – Includes such things as securities bought with intention to be sold to generate income on short-term price differences. 5. PREPAID EXPENSES – Expenses that are paid for and recorded as an asset before use (i.e. insurance). All of the assets listed above are important to manage in different ways. For example, it’s crucial that you always keep an accurate assessment of the inventory your company keeps in stock. It’s also super critical you actively pursue

any open invoices you have so you can turn those receivables into liquid cash faster. Most importantly, however, it’s important to keep a watchful eye over the actual cash you already have. Cash is king in your small business, and it’s important you understand what this cash is being used for. To do so, be diligent in both your cash flow forecast and cash flow monitoring. Tracking every dollar in and out is precisely what needs to be done. In short, the amount of working capital you have is the total of your current assets minus your current liabilities. Be certain you are keeping track of these two figures to guarantee your working capital calculation is as accurate as possible, ensuring you know exactly how many dollars your business has to work with.

About the Author Meredith Wood is the Director of Community Relations at Funding Gates, an online application for small businesses that allows them to track, organize and manage their receivables all with simple clicks. An avid small business writer, Meredith’s work can be seen on Amex OPEN Forum, SCORE, the Small Business Bonﬁre and many other small business sites. Connect with Meredith on Twitter @FundingGates.

IS YOUR BUSINESS BEHIND THE TIMES? By Rieva Lesonsky t’s surprising how many small business owners you still see struggling with outdated technology—or no technology at all. Have you made a purchase at a local store lately only to be handed a handwritten receipt? Or is your store or office guilty of this practice? If you’re not using technology to run your business, you’re missing out on sales, profits and customers. A survey last month by Yodle discovered that shockingly few small business owners are taking advantage of all the technology that’s out there to help them. Here are some of the specifics the first annual Yodle Small Business Sentiment Survey uncovered, with a closer

look at how technology can help for each.

51 percent of small

business owners use technology to help with accounting. If you’re still using a paper-based accounting system, you’re costing yourself time and money. Today’s accounting software can integrate with your bank account so your transactions update instantly in

multiple places and you always have access to real-time information about your cash ﬂow. Isn’t that better than inputting (or handwriting) the same data multiple times in multiple places and dealing with tons of paper at tax time? Not to mention it helps reduce human error and makes you look more professional.

39 percent of small

business owners use technology for scheduling and booking appointments.

While this may sound intimidating, in reality there are many solutions that let small businesses (like dental oﬃces, hair salons and restaurants)

34 percent of small

business owners use customer relationship management (CRM) software. Smart salespeople have always kept track of their interactions with customers, plus details like that key customer’s wife’s name, hobbies and kids’ ages. But while they used to do it on 3×5 cards or notebooks, now they can use sophisticated CRM systems that make it much easier. CRM sometimes gets a bad rap as complicated to use or hard to learn, but that doesn’t have to be the case if you choose a system that’s built for small businesses rather than enterprise-level customers. Just input the right data and you can book appointments and reservations, or even allow their customers to book themselves online. Whether your customers are likely to use the latter option may vary depending on your customer base, but you might be surprised to discover it’s not just twentysomethings who like the convenience of setting appointments online. (After all, it eliminates something most of us hate: phone tag.) That said, be sure to provide multiple options

get reminders for when to follow up again, automate parts of the follow-up process and access your information from anywhere across all your devices.

25 percent of small

business owners use technology for point-of-sale systems. for how your customers can schedule with you; sometimes even the hippest techie wants to talk to a live person.

This one really shocked me—especially today when so many exciting advancements are being made in mobile payments. There are card-reader systems you can use with your

smartphone or tablet to accept debit or credit payments anyplace, anytime. They work whether you’re selling crafts at a local street fair, or upscale clothing at your mall boutique.

Now that so many businesses accept credit or debit payments for even the smallest purchases, customers are getting out of the habit of carrying cash—and many are abandoning checks, too. Who wants to miss out on a sale because customers don’t have cash and you can’t take credit cards? I’ve saved the worst for last: The Yodle study found more than half of small businesses (52 percent) still don’t even have a website. Think about it—when you need to ﬁnd a business these days, where do you go? Do you drag out a phone book from its dusty hiding place, or do you grab your laptop or smartphone to do a quick search? I thought so. If your business isn’t online, the majority of customers won’t even know you exist. Getting a simple website up and running is easier and cheaper than it’s ever been, costing literally just a few dollars a month. If you’re not using technology for the processes mentioned above, making even one small change could make a huge diﬀerence in your business. Don’t wait—check out your options and start seeing improvements.

About the Author Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at rieva@smallbizdaily.com, follow her on Google+ and Twitter @Rieva, and visit her website SmallBizDaily.com to get the scoop on business trends and sign up for Rieva’s free TrendCast reports.

Let Loyalty Be Your Fault By David Schwartz Running a business is hard; marketing a business isn’t much easier. Sometimes you have to make choices, and by letting loyalty be one of your faults it is one of those good mistakes you should make. If you are in the customer service business like a restaurant or retailer, could too much customer loyalty ever be a bad thing? Loyalty is built on trust. Once that trust is established a longterm relationship can be built similar to the bond between a dog and his owner. In marketing you have to make assumptions, you don’t always know if choices will turnout to be the right ones. Even with better tracking and analytics, it’s still a crapshoot since you’re dealing with human interactions and

impulse decisions. Customers walk in the door, they buy your product and in actuality it may not have anything to do with your marketing campaign or a promotion. Should that still count as a marketing win? Do you know which foolproof marketing eﬀort is guaranteed not to fail? Taking care of your loyal customers. It is that simple, reward customer loyalty. Brands often spend too much money targeting new customers while they forget to nurture the relationships with the loyal customers they already have. Ever hear a customer complain about being pampered, treated with respect or made to feel too special

and valued? A customer relationship starts the moment they walk in the door. Wait, on second thought that might have been the old way, now a relationship can start before a customer has even touched your brand. Create a relationship built on trust, ﬁrst. Marketing author Jay Baer calls it “friend of mine awareness” where the customer already knows who you are before they even consider buying from you. Relationships and loyalty go hand in hand. Social media has created a platform for customers to build relationships with brands, no matter the size of the organization or how many restaurants exist. Social Media has created the greatest CRM program to date, sure email is successful and direct

mail with a valuable oﬀer is nice, but what social media allows a loyal customer to do is share their status, their allegiance… their loyalty. Maybe even brag a little bit, and that endorsement is free advertising. Loyalty is a bond between two parties, a connection built on trust and past success. Relationships are built through shared experiences. Today, when sharing a brand’s story

or gesture representing your appreciation wouldn’t hurt, either.

Honesty: Being honest is simple, smart business. Customers don’t always expects brands to be perfect but they sure do expect them to be honest. Being honest about mistakes can be humanizing for a brand, there is nothing wrong with that as honesty can build trust.

Respect: Do not make the mistake of upsetting your loyal customers, do not abuse the relationship by selling email lists or spamming. Loyalty is gained through respecting boundaries, keep that in mind and treat customers the way you would want to be treated. Remember, a loyal customer already likes you, don’t give them a reason to change their minds. both parties have an opportunity to contribute and show their mutual loyalty to each other. How do you go about building loyalty with your audience?

Appreciation: A little appreciation can go a long way, especially when no strings are attached. You might be surprised at how far a simple thank you goes with customers. While you are at it a token

Value: Value is tricky since it means diﬀerent things to diﬀerent people. One way to present value is to keep expectations in check by informing and educating your audience. Help teach a customer how they can best use your concept from spending less or getting more back in return. Content Marketing is a great way to educate your customer by sharing tips or tricks of

* This article “Let Loyalty Be Your Fault” ﬁrst appeared on BrandEd

the trade. Don’t be afraid to share a recipe or let them see your popular technique for folding napkins.

Listening: This is really important; if you are not willing to listen to your most valued customers then who are you going to listen to? Whether it is comments or complaints you need to be listening. Consider using your loyal customers to crowdsource for ideas, such as new menu items or your next location. Start looking at customer feedback as a good thing. So there you have it, 5 common sense approaches to help you build loyalty with your customers. No matter the business you are in, all customers like honesty, appreciation, respect, value and being listened to. I know I do, now what about you?

About the Author David is a Brand Strategist focused on building relevant brands, while creating valuable consumer relationships to promote engagement. By utilizing the popularity of digital and mobile media, along with the social web he helps companies understand the power of controlling their content. David started his career working for MTV in New York, he then proceeded to Atlanta to work with the likes of Coca-Cola, Chick-ﬁl-A and the Home Depot. From his time working with companies of all sizes he has learned that a strong brand is the key to long term success by turning customers into brand advocates. Now living in Nashville with his wife and two children, David works with companies of all sizes teaching and consulting on best practices for building a brand in the digital age.

THE CURE FOR SELF-INFLICTED COMPLEXITY by Roger Martin he collective belief that complexity is on the rise is largely an illusion. We’ve inﬂicted it on ourselves by our primary method of dealing with the complexity that has always been an inherent part of our world. As I’ve argued previously, we attack dynamic complexity by minimizing detail complexity, and thus divide the world into numerous deep knowledge domains – which in turn generates a disquieting level of inter-domain complexity. This of course begs the question: is this self-inﬂicted inter-domain complexity a problem? Should we be worried about it? Because we are notably bad at dealing

productively with the inter-domain complexity that we have created, I think it is indeed a problem. Ironically, we are crummy at dealing with it because of the predominance of narrow knowledge siloes – which are of course the self-same knowledge siloes that created the inter-domain complexity in the first place. Kafka would be impressed! Inter-domain complexity challenges us whenever a hospital patient has co-morbidities (heart and liver problems for example), or a business problem spans marketing and finance, or a political problem bridges foreign relations and domestic economics. The specialists who focus on heart, liver, marketing, finance, foreign relations, and domestic

economy frame the problems using their tools, models, and language systems because that is what they know and that is where their confidence lies. It is hard for them to un-frame what they have framed or un-see what they see. It is not impossible. It is just hard. Typically, every bit of their formal and informal education has taught them to sacrifice detail complexity – to narrow problems to facilitate analyzing them. They don’t actually know how to take two opposing frames, models, and diagnoses, and do something useful with them. In fact, the more expert they are, the less likely they are to ever have done so – even once in their life. So they stick assiduously to something at which they are terrifically good: being narrow, and confidently so. Furthermore, they tend not to suffer any personal downside from taking a narrow perspective. The heart surgeon doesn’t get blamed if the patient’s liver failed due to the stress of surgery. The marketing executive doesn’t get blamed if the finance executive failed to come up with the capital necessary to fulfill the marketing executive’s grand plans. Net, there is little training and few rewards for dealing productively with inter-domain complexity. Were there no heart, liver,

marketing, finance, foreign relations, or domestic economy experts, we wouldn’t face inter-domain complexity or the associated problems. However, we would face lots of detail and dynamic complexity. The world is not entirely crazy. There is a reason to specialize in order to try to cut into dynamic complexity, to try to tease out cause and effect relationships and advance our knowledge in various domains. The key, as with so many things in life, is to get beyond either/or. To move our understanding of the world forward, we need to tackle both detail complexity and dynamic complexity. We don’t want to operate with one gigantic knowledge domain in which our ability to advance knowledge is ponderously slow. But by the same token, we don’t want innumerable knowledge domains that slice and dice our world into such little and incompatible pieces that we advance knowledge that isn’t really powerful for our lives. I believe that the solution to the self-inflicted problem of inter-domain complexity is the development of a meta-domain: the domain of knowledge about how to integrate across knowledge domains. While this might seem on its face to be an esoteric or even unapproachable knowledge domain, it really isn’t either. There are techniques for tackling fully clashing models

from different knowledge domains. More importantly, these techniques can be taught, though masters of individual knowledge domains tend to fight against the notion that anybody not steeped in their frames, models, and tools can deal with their domain in any useful way. Perhaps most excitingly, these techniques for dealing productively with inter-domain complexity can be taught to children. In our I-Think initiative at the Rotman School, we’re teaching even elementary school children how to wade confidently into and resolve inter-domain conflicts. These young people have a blessed characteristic not shared by their adult counterparts: they don’t think what they are doing is strange; they think it is just plain sensible. If we train enough of them, I think we’ll see many positive changes in the years to come. Among them will be a common sense that complexity is dropping, not rising. This post is part of a series of perspectives leading up to the fifth annual Global Drucker Forum in November 2013 in Vienna, Austria. For more on the theme of the event, Managing Complexity, and information on how to attend, see the Forum’s website.

ABOUT ROGER MARTIN

information, including events with Roger, click here.

Roger Martin (www.rogerlmartin.com) is a Professor and the former Dean of the Rotman School of Management at the University of Toronto in Canada. He is the author of Playing to Win: How Strategy Really Works. For more

This article was originally published on the Harvard Business Review website. The original link can be found here: http://blogs.hbr.org/2013/10/the-cure-for-self-inﬂicte d-complexity/

8 Must-Have Mobile Apps For Small Business Owners By Meredith Wood ot all mobile apps are created equal. That’s why every small business owner should think carefully about the ones they use while traveling from one destination to the next. The best mobile apps allow you to stay in touch with your team, handle tasks that are typically done from your office, and make arrangements with clients and potential clients in a matter of seconds. Some of the best mobile apps around will make life simpler for business men and women by being readily accessible, easy-to-use, and reliable. What more could you ask for from a mobile application? Must-Have Mobile Apps For Business Owners Here’s a quick look at eight of the best mobile apps on the market for small business owners (in random order):

SKYPE Hands down one of the easiest apps to use, Skype allows business owners to make and receive calls from anyone in the world, easily. Setting up a free account enables users to reach out to others via video conference call and a paid account allows users to make phone calls to telephone numbers directly. If you’re concerned about roaming charges, it’s well worth the fee to pay for this option or use Google Hangouts, a free mobile app, instead.

ASANA Asana is one of the small business community’s most beloved web and mobile applications designed to improve the way teams communicate and collaborate. If you’re on the go, managing team tasks, projects and deadlines, Asana empowers teamwork without back and forth emails. The application offers a shared task list for your team – the best way to communicate, organize, and track your work.

Dropbox Team members can share documents with you and others safely and easily using Dropbox. By setting up a free Dropbox account, you can select who can add and access content on your account. This is a very effective way to keep your email inbox clutter-free. You needn’t worry about lost communication if you direct everyone to the same folder on Dropbox.

Uber When you need to meet a new client, or arrange for car service, in style put your company’s best foot forward with Uber. Uber, a mobile application that connects passengers with drivers of luxury vehicles for hire, is available in select cities. Their elite limo experience and on-demand service fits an efficient and modern lifestyle for the forward-thinking business owner.

Paypal Send and receive payment with ease using Paypal. You can take care of employees, contractors, and vendors on-the-go by receiving their invoices and making payments directly from your Paypal account. keep in mind that the service isn’t entirely free, there are merchant fees involved with certain transactions.

Square Accept credit cards as payment wherever you go with the handy Square card reader and app. The app offers two payment options: a) you can pay a flat $275 a month for unlimited transactions or pay per transaction depending on the number of credit cards you process each month. The later option will cost you 2.75% per swipe.

Expensify Keep track of expenditures all in one place. The Expensify app allows you to itemize costs, create reports, and upload receipts for proper documentation. The account is free and one you’ll definitely want on hand if you do any driving, dining out or accommodation rentals while on the road.

Hootsuite Schedule social media status updates and tweets in advance. Streamline the social networking process by selecting the date and time you want to send messages and refrain from going days at time without distributing fresh social content while you’re away on a business trip.

Mobile applications were designed to make life easier. If you find that you’re on-the-go often, you’ll love having access to these eight time-saving apps. Not only will you be able to communicate with employees, keep tabs on expenses, and even send out payroll, you’ll keep your sanity knowing that your productivity remains in tact. In fact, one swipe of the finger is all it takes to keep in the loop from your mobile device.

About the Author Meredith Wood is the Community Manager at Funding Gates, the ﬁrst ever online credit department for small businesses. By automating the entire debt collection process, Funding Gates is the one-stop-shop for receivables management. Always looking for good talk on small business (and ways to get paid), connect with Meredith on Twitter @FundingGates.

Use Strategy for Your Small Business – You’ll Be 80% More Likely to Reach Your Goals! By Michael Nelson

reating and writing down the strategy for your small business will make you 80% more likely to reach your goals. This is especially true for solopreneurs or businesses with only a few people. Getting your strategy together and organized around reaching your goals makes a huge diﬀerence in reaching your goals and it makes your business much easier to work on and in. Your strategy shouldn’t be some convoluted and massive plan that goes into a binder never to be seen again. It should be short and sweet and focus you on your objectives, how you’re going to reach those objectives and what resources you’ll need to commit. You’ll also be able to track your progress along the way.

reduced stress – increased revenue – increased proﬁt – reduced costs – progress reporting – eliminate shiny object syndrome – eﬀective marketing – improved sales results – compelling messages and so on. Hope is no longer the driving force behind your business success! This short (7 minutes) video walks you through all you need to set up a simple strategy for your business and here is a link to download the worksheets from the video (just hit play on the video here and it’ll appear).

Some of the beneﬁts of having a strategy: focus – better control of your budget – ﬁnding ideal clients –

ABOUT THE AUTHOR I’m Michael Nelson “The Cogent Coach.” I'm a small business coach and strategic digital marketing consultant to small and mid-sized business. I help bring order from chaos, grow revenue and increase business valuation while simultaneously reducing business owner stress and hours worked. My clients are all over the world and include music labels, internet start-ups, construction companies, financial firms, graphic design shops, music producers and musicians, fitness studios and many others. Their marketing results have soared, the value of their businesses has risen and they have saved on key resources such as time and money. To learn more, visit http://thecogentcoach.com. Connect with me on Twitter @CogentCoach, on Facebook and on Google+.

5 Entrepreneurial Lessons from the Medical Field

By Daniel Wesley

here’s usually a type of background that comes to mind when you picture an entrepreneur — one that involves an MBA or, at the very least, a few management classes. Well, my crash course in entrepreneurship stems far from the business school and instead is rooted in eight years working in nuclear medicine.

I can see why my time in the radiology department at a hospital may seem unrelated to what I’m now doing as the founder of an Internet startup. But my time working in the medical ﬁeld has been invaluable to my success as an entrepreneur. Why? Because more o en than not, it’s life experience that makes or breaks a business, and working in medicine is nothing if not a large dose of life experience.

From the art of strategically communicating with doctors to the attention to detail needed when taking a brain scan, working in medicine unknowingly set me up to win over investors and prepare for even the most unforeseeable difficulties. Below are five entrepreneurial takeaways from the medical field.

1. THINGS CHANGE QUICKLY. This is perhaps the single most important lesson I took away from the medical industry. Working at a hospital means working under circumstances that are constantly changing, and oftentimes, not changing in the direction you would like. However, I adapted to this particular situation by learning to read into any possible warning sign and then react accordingly. This ability to read and react to potential problems has given me a forward-thinking approach to business, allowing me to head off problems that could have been fatal to my company.

2. YOU CAN’T TEACH PASSION. Nor can you plan on someone having the same passion and enthusiasm for work as you do. In medicine, there is a distinct line between those who do their job well and those who have a true passion for what they

do. I learned to spot the difference between the two early on, and now as a business leader, I can spot it a mile away. I use this skill to find the right people for my team — people who are as passionate and enthusiastic as I am.

3. THERE WILL ALWAYS BE SOMEONE SECOND-GUESSING YOU. In the medical field, it could be a doctor who thinks he knows more than you or the CEO of the hospital who doesn’t understand your job. It could even be a patient who did a few Internet searches. No matter what field you’re in, there will always be someone

though I knew my peers and I were right, I would sit back and listen rather than arguing until I was breathless. Why? Because you don’t need to win every battle to win the war. My ability to gauge when to speak and when to just listen has been a big part of my success in both medicine and business.

5. THERE’S A DIFFERENCE BETWEEN KNOWLEDGE AND PRIDE. Some leaders tend to have more of the latter than the former. Once a leader has the experience to prove that his sense of determination stems from valuable knowledge versus blind pride, it’s amazing the kind of attention and respect people will give a leader’s ideas. This respect is both invaluable and irreplaceable. The bottom line is that there is no replacement for life experience. Every challenge in life lends the opportunity to develop new skills, like handling stress, managing people, and communicating ideas — all of which are crucial to running a business.

there to challenge you. Have the confidence to fend off the second-guessers and defend your opinions and ideas. If you won’t, who will?

4. CHOOSE YOUR BATTLES WISELY. This could seem contradictory to the lesson above, but let me explain. Many assume that if they’re right, they’re right, and they shouldn’t stop until everyone knows it. However, that’s not a strategic outlook. While working in medicine, my department was often challenged, and even

For me, these challenges took place in the radiology department at a hospital, and now I can take what I’ve learned and apply it to my business. However, I’m sure there are plenty of other successful entrepreneurs who earned their leadership skills from places far more obscure. It doesn’t necessarily matter where you get these valuable experiences; it’s what you do with your experiences and how you apply them that will decide your success.

About the Author Daniel Wesley is the founder and CEO of CreditLoan.com, a website that educates consumers about various personal finance issues. Among some of the topics discussed are bad credit loans, credit cards, auto financing, and many other credit and financial help issues. Connect with Daniel on Twitter and Google+.

4 Pitfalls for Middle-Market Businesses and 5 Ways to Avoid Them BY MICHAEL EVANS

ver the last decade, the U.S. has seen unprecedented growth in the private sector as compared to large companies. The number of smaller companies grew 79 percent from 2000 to 2010. The number of larger companies decreased 2 percent for the same period.

Despite all this growth in the middle market, many if not most of its companies will stagnate or go out of business. Statistics show that only 1 in 10 will ever grow larger than 100 employees and 7 out of 10 will eventually disappear. Why? Emerging middle-market companies tend to falter when they reach “No Man’s Land,” the phase of development where their growth slows or stops for a variety of reasons: • MARKET – the management team struggles to do for customers what the founder had successfully done by himself or herself in the company’s early days.

• MANAGEMENT – the company has been unable to develop a high-capability management team that can take the business to the next level. • MODEL – the company does not have a proﬁtable economic model at a higher level of volume, and has not created infrastructure to support growth to compete with larger companies. • MONEY – the company does not have capital to fund its anticipated level of growth. Companies can often move past the stagnation of “No Man’s Land” with a 5-step approach:

STEP 1: ENGAGE YOUR MANAGEMENT TEAM WITH PROBING QUESTIONS Assess where you are today and where you want to go: • Where is the business today? Why is it where it is? Is the team satisﬁed? • Where does the business go from here? • Is it on track to get there? What resources or tools are needed? • What do our newer customers need and expect from us that’s diﬀerent from what our original customers expected?

STEP 2: ADOPT A MARKET-DRIVEN APPROACH Companies can often avoid stagnation by adopting clear and precise growth strategies. Too often it takes a crisis such as the loss of a major client to force this to happen. Consultants are brought in, people are replaced, costs are cut, and more mistakes are made — which tends to produce a result opposite to what was intended. Companies that eventually reach the next level of growth generally follow three rules: 1. All teams within the company (top management, R&D, ﬁnance, marketing, service, and production) adopt an urgent customer-focused strategy to stem the loss of clients or the perception of bad service. 2. The company gets objective information that provides perspective and insight about the company’s position and prospects in its market. Internal ﬁnger-pointing, disillusionment, and failure to acknowledge responsibility are fatal. 3. Using this information, the team changes the direction of the company and refocuses on the customer.

STEP 3: ADOPT A NEW GROWTH STRATEGY Many companies fail to adapt their product-and-service mix and business model to meet the challenge of producing growth. Often they have a product that is selling well but they fail to innovate and ﬁnd that a new competitor has taken over the market. New growth strategies are needed, including: • Core Strategy – a basic strategy to expand your core product oﬀering either geographically or to new customers and markets. • Adjacency Strategy – are there “adjacent” areas around the company’s core products or services that are natural extensions of the core?

• Extension Strategy – Strategies that reach beyond natural adjacencies to variations or extensions of the company’s products or services that might position the company for growth. • New Market Strategy – consider entering new markets through new models like alliances, channels, partnerships, mergers or acquisitions, or even franchising your product or service.

STEP 4: CONSIDER NEW WAYS TO FINANCE YOUR BUSINESS Public companies have alternatives for financing growth through big banks and Wall Street. For private middle-market companies, the main traditional sources of growth capital have been internal capital generation from profits and bank lines of credit. Private companies need to mimic public companies by expanding their sources of capital and creating a backup plan in case current sources become unavailable. Many capital sources are available to private companies. Examples include Asset-Based Lending, SBA loans, receivables financing, sale/leaseback, lines of credit, fixed-term debt, and emerging crowdsourcing financing. All have different costs, restrictions and availability. Some may require personal guarantees though the terms of these vary widely. Smart CEOs and CFOs need to be familiar with all of them.

STEP 5: IDENTIFY AND MANAGE YOUR RISKS According to a 2011 RIMS survey, 54 percent of companies have partially or fully implemented a formal Enterprise Risk Management (ERM) program. That means that 46 percent have not. Many smaller companies believe that ERM is a bureaucratic exercise that does not promote sales or growth and can lead to “analysis paralysis.” As a result, many private companies incur risks they did not anticipate and they fall victim to those risks. Identify your key business risks, attach probabilities to each risk, and mitigate and track these risks. If you see risk in having too much of your business concentrated in a few customers, make it a priority to reduce this concentration, even if you have to cut your margins temporarily. By adopting some key business strategies, you can position your business to reach the next level of growth and have a shot at generating real wealth for yourself and your investors.

About Michael Evans Michael Evans is Managing Director for the Newport Board Group, a partnership of board directors and senior executive leaders with deep knowledge of business strategy, operations, and capital markets. Michael is a frequent writer on business topics and has authored two books. He can be reached at (415) 990-1844 or via email at mievans@msn.com.

LEARN WHAT ZONES YOUR EMPLOYEES ARE COMING FROM BY JOSIANE FEIGON First, let’s define these zones: 01. The Dead Zone Have you ever talked to your team and noticed how differently each person listens? I’ve found that people usually fall into one of Four Zones that influence the way they listen and learn. Managing your whole team effectively means you need to know which zone each person is in and have a strategy for coaching to that zone and perhaps influencing change.

People in this zone have checked out. Basically, they just don’t care. These folks are probably your low to medium performers. They’ve plateaued, and have no desire to advance further.

02. The Comfort Zone

People in this zone are sitting comfortably in their own little world. They are complacent. They resist any change that is happening around them. These average performers will do just enough to get by, and won’t show initiative for anything else.

03. The Panic Zone

People in this zone feel anxious, nervous, frazzled, and overwhelmed. They care a lot — a bit too much. They are ambitious, but afraid to say no or to honestly assess their limitations, leading them to take on too many projects.

04. The Stretch Zone

People in this zone are excited (but not over-excited), enthusiastic, and ambitious; they have new goals, ideas, and strategies. They care a lot and want to do things diﬀerently. These are probably your top performers and the ones you want to inﬂuence the team.

NO ONE STAYS IN THE SAME ZONE FOREVER For example; a new hire may begin in the Stretch Zone. But once they learn what exactly is involved in the job, they may jump to the Panic Zone. As time passes and they get to know their job really well and move into automatic pilot, they may start resting in the Comfort Zone. If they’ve been passed up for a promotion, or they have a lousy territory, they may start caring less and less and end up in the Dead Zone. Once you’ve determined which zone each team member falls into, you can tailor your coaching to meet their needs.

Coaching in the Dead Zone: This zone is

dangerous because people who no longer care are resistant to trying anything new – they are very close to leaving the organization. When coaching them, ﬁnd out what got them into this zone — it could be for personal or professional reasons, or both. Then have that tough talk with them. Ask them if they think they are in the right role; you may want to encourage them to moving into a diﬀerent role or department. Many managers fail to recognize when someone is in the Dead Zone. They think that giving them new hires to mentor will help them feel needed and get them out of their “funk.” Big mistake! The Dead Zone can easily infect your new hires.

Coaching in the Comfort Zone: Salespeople

who have been part of the old sales regimen may fall into this comfort zone. They are low-risk about adopting new ideas and they’re stuck. But they can be coached, because they really care. When you coaching someone in the Comfort Zone must, include strategies that shake them up and change their routine, their territory, their product responsibilities. or perhaps their vertical. It might also include putting them on a new project to manage. giving them the opportunity for recognition and reward. Be careful! Someone in the Comfort Zone who isn’t managed properly can eventually ﬁnd themselves in the Dead Zone, where it might be too late for change. You might try sitting your Comfort Zone rep next to someone in the Stretch Zone — they just may share some needed energy.

Coaching in the Panic Zone: These people can be new hires who ﬁnally realized what is expected of them and are running scared; or they may be senior team members who are overachievers with low self-esteem who panic at the end of the month to hit their numbers. Help them understand that panic isn’t the answer, and help them separate things that really need their attention from those that can wait. Be gentle. The last thing they need is pressure from you — they are putting enough pressure on themselves. Prioritize with them. Help them slow down, sort through, and organize what’s in front of them. Coaching in the Stretch Zone: We wish all our team members could be in the Stretch Zone. Nonetheless, coaching someone in this zone is delicate — you don’t want to kill their spirit, just keep them on task. Coach them to stay focused, enthusiastic, and ambitious, but keep them in check.

WHAT PERCENTAGE OF YOUR TEAM IS IN EACH ZONE? Ideally, you want your team to have some zone-balance. But — depending on your team structure, their seniority, and the time of the sales quarter — your team is likely to be squished into one or two zones. For example, if you have a senior team and 80% of them are in the Comfort Zone, you are going to have a diﬃcult time motivating them and changing behavior. Or, if your team is young and still ramping-up, but Q4 is bearing down on everyone, you’re likely to see more Panic Zone in the team and you will need to focus on being a calming and organizing inﬂuence.

About the Author Josiane Feigon is President of TeleSmart Communications and author of the business bestseller, Smart Selling on the Phone and Online. To read an excerpt from her latest book, Smart Sales Manager, click here.

Top 10 Things Executives Need to Know About Marketing Automation BY BETHANY HANDY arketing automation software can be a very useful tool for your business, but there are some things you should know before you implement it. These are the ten most important elements of marketing automation software that you need to know.

4) Marketing automation software helps with data analysis

1) Marketing automation software can drastically reduce time spent working on some tasks

Therefore, you will need to decide how many of those steps your software should be involved with.

The primary goal of the software is to automate simple, repetitive tasks that don’t really need human action.

6) Quality content is valuable

2) This software will not run your marketing campaign for you Some people make the mistake of assuming that automation software will deal with all of their marketing needs. It won’t. It is, however, very good at doing what it’s designed for – automating a lot of your campaigning. 3) The software is fairly easy to customize Your needs are not the same as those of other businesses. You can (and should) set the software up so that it beneﬁts your company the most. Hire an agency that has in depth knowledge of the software to help you ensure you are setting the software up in a way that is most beneﬁcial to your company.

When one program is doing much of the work, it’s easy to create reports that provide valuable statistics. Don’t neglect this. 5) Marketing has many steps

And automation software is a good way of delivering it. Don’t forget to provide worthwhile material at every step of the marketing process, or your automated campaign could become a major ﬂop. 7) Repeat Customers are good to have Which is why you shouldn’t focus your automated marketing solely on new leads – give your existing customers something nice every now and then. 8) Marketing Automation can be internal, too Thereby making things easier in your oﬃce and allowing more time for your marketing team to be creative. That’s very good to have. We use marketing automation software at Thinkhandy and work on our own campaigns in the same way we work on our clients campaigns.

9) The software should not be over-used I don’t mean what’s talked about in number ten, either. Too much automated material can make you seem artiﬁcial, which makes people less interested in you and your products. Moderate your use of the software, especially while you’re still learning how to use it properly. 10) The human touch is still necessary Automation software can guide customers, but humans need to provide the creative spark and ideas. You want to ensure your company has processes in place to reach out to people at various, predetermined times during the sales process. This is very important because just having marketing automation software will not close your sales cycle, your marketing and sales teams will need to do that. Keep that in mind throughout this entire process! Marketing automation software can be a great tool for your company to get more leads and sales. Knowing how to setup and use the software is vital to your success. Purchasing and installing the software is not enough, you need to have a deep understanding of how it works best for your particular company and situation.

Suc c es s f ul St ar t up101 TheKnowHowY ouNe e dt oL e a dY ouOnY ourPa t hT oBus i ne s sSuc c e s s

advisors vs. mentors: whatâ&#x20AC;&#x2122;s the difference? By Christina Memorio Weâ&#x20AC;&#x2122;ve all heard the story of how a Harvard sophomore took an idea (or stole, depending on which side of the debate you are on) and turned it into a social networking megalith. That sophomore was none other than Mark Zuckerberg and the megalith, of course, is Facebook. As an entrepreneur, you are not the only one who salivates at the notion of becoming a seemingly overnight success story like Zuckerberg and changing the course of history for your industry forever. But itâ&#x20AC;&#x2122;s important to note that Zuckerberg did not achieve this success on his own (and, no, this is not another article exploring how he took the idea for Facebook from the Winklevoss twins). While many would like to believe that Zuckerberg was the sole mastermind behind the now multi-national corporation, the truth is that he had some help along the way in the form of advisors and mentors.

But First, Why is Having a Business Advisor or Mentor So Important? You may be able to argue that your value proposition sets you apart from anyone who is currently in your space or who has ever been there before. While this may be true, at the end of the day, business is business and as a business owner you should jump at the opportunity to learn from the experiences of those who have been presented with challenges similar to yours. One of the easiest ways to give your company a competitive advantage is to leverage the help of those who have been there and done that already. This role can easily be filled by a business advisor or by a mentor. The words ‘advisor’ and ‘mentor’ are often used interchangeably, but in all actuality, they couldn’t be more different. Understanding the difference between the two is critical in deciding which one makes the most sense for your business.

Advisors Focus on the Business Given that the definition of the word ‘advisor’ is ‘one who gives advice,’ it’s only natural to assume that if you hire an advisor, whether it be a business advisor, financial advisor or an advisor with a specific expertise in a particular area of practice,

their job is literally to give you advice on what you should do. Let’s go back to our Facebook example. Zuckerberg had a great idea, but as a college sophomore, even at an Ivy League school like Harvard, his business acumen was probably lacking much real-world application. Luckily, Zuckerberg had a friend, Eduardo Saverin, who not only invested $15,000 for the initial servers used to house “TheFacebook.com” (as it was originally called), but he also served as Zuckerberg’s confidant. In exchange, Saverin received 30 percent of the company. The important distinction here is that Saverin was technically a part of the company as partial owner. Advisors are usually legally associated with your company, and as such, are financially compensated for their services. Many business owners like to employ well-known advisors that they can showcase on their websites, believing that a high-profile advisor will speak to the credibility of their

business. While this certainly may be true, depending on your industry, it’s more important to ﬁnd an advisor who will add value to your business through his or her knowledge and experience.

Mentors Focus on You In contrast to advisors, mentors are not typically associated with the company, but rather, are focused on the business owner’s own personal growth and development. Zuckerberg also benefitted from the help of a very well-connected mentor, Sean Parker. Parker, played by Justin Timberlake in the movie The Social Network (completely irrelevant, but I can’t miss an opportunity to mention JT!), was the co-founder of Napster. He first discovered Facebook when he saw the site on his roommate’s girlfriend’s computer (she was, at the time, a student at Stanford) and immediately flew to New York to meet with Zuckerberg.

Many like to speculate that without Parker’s connections (he introduced Zuckerberg to Peter Thiel, PayPal CEO and Facebook’s first major investor) and guidance, Facebook would not have seen success as quickly as it did, or at all for that matter. While Parker was named President of the newly incorporated Facebook company in 2004, he initially was not financially compensated, thus fulfilling the role of Zuckerberg’s mentor. Perhaps the most important distinction between a mentor and an advisor is that a mentor is not on your payroll. There is not a financial benefit to being someone’s mentor. A mentor has usually been in your position before and can offer advice to lead you in the right direction. Mentors are much more focused on your personal growth and development as a business leader. Mentors will typically offer advice that is both professional and personal in nature. Generally speaking, mentors tend to be older and usually have achieved career success similar to the mentee’s business aspirations.

Things to Consider So, now that you know the diﬀerence between the two, which one makes the most sense for you and your business? Ultimately, that depends on your end goals. Before settling on either, there are important things to consider:

Will he or she be available when I need them to be? In business, things can change or a situation can arise in an instant. If you need advising, are you certain that your advisor or mentor will be available to answer your questions? If you hire an advisor, you may want to write a clause into their contract to address this need if it’s something that you believe will happen quite often.

Can I trust his or her advice? If you do not conﬁdently believe in an advisor or mentor’s abilities, they aren’t worth your valuable time. It’s important to trust that your mentor or advisor has you and your business’s best interests at heart.

Do we have compatible business styles? Do we have the same ethical values? These are perhaps two of the most important and often the most overlooked questions to consider. If your advisor or mentor has different values or works completely differently than you do, their advice may not be the best fit for your goals. While you don’t want another version of yourself (after all, the whole point of an advisor or mentor is to get someone else’s perspective), if

you don’t have compatible business styles and values, you will spend most of your time arguing or defending your point of view, rather than having productive meetings to steer your business in the right direction.

Do I like him or her? If the answer is no, ﬁnd someone else. It’s that easy.

Do you have a business advisor or mentor? How have they helped you get your business to where it is today?

About the Author Christina Memorio is an SEO Specialist at Business Financial Services. Her content covers a wide variety of topics relevant to small business owners, from ﬁnancial advice and alternative funding solutions to social media and content marketing practices for SMBs. In her spare time, Christina loves to cook and is a die-hard fan of the Florida Gators. Connect with BFS on Twitter and Google+!

*This article originally appeared on Under30ceo.com

Customer Experience Controls Business Growth Today Existing customers today are ﬁckle and will leave you quickly, if they get word-of-mouth negative messages from their connected sources

BY MARTIN ZWILLING

Many startups and mature businesses have not yet adapted to the fact that customer satisfaction in this “always connected” age is more than product and service quality. It’s more about which customers broadcast their pleasure or unhappiness to others. With incredible ease, they can inﬂuence thousands or millions of potential new customers, or say nothing. Most existing metrics and analytics for measuring customer satisfaction and

loyalty, including the popular Net Promoter Score (NPS), don’t distinguish between recommend messages to others (word-of-mouth), detract messages, or no message. In his new book, “Innovating Analytics,” Larry Freed, a customer experience and analytics expert, makes some convincing points on the drivers for business loyalty and success that every business owner should commit to memory. Here are four basics that always apply:

1 2 3 4

CUSTOMER RETENTION IS PRIORITY NUMBER ONE. Keeping

your current customers is one of the most important keys to revenue growth. According to Inc. magazine, acquiring a new customer costs about ﬁve to nine times more than it does to sell to an existing one, and on average, current customers spend 67% more than new ones.

CUSTOMER UPSELL, SELLING MORE TO EXISTING CUSTOMERS.

Selling more to loyal customers is a great success strategy. But to engender loyalty, you have to be delivering a good experience and keep satisfaction high. Existing customers today are ﬁckle and will leave you quickly, if they get word-of-mouth negative messages from their connected sources.

MARKETING-DRIVEN CUSTOMER ACQUISITION. Traditional marketing

eﬀorts (advertising and promotions) are still important. In this context, the palette of channels for reaching customers has greatly expanded, to now include social media, digital to mobile, and new Internet options. The challenge is to measure resources spent against return.

WORD-OF-MOUTH DRIVEN CUSTOMER ACQUISITION. The new dominant method of acquisition is engagement of potential customers through social media and key inﬂuencers, and converting these prospects into customers with a satisfying experience. Here the satisfaction experience does double duty, as it is messaged down-line to other prospects.

In the past, retention and loyalty were often used interchangeably. Today, true loyalty, earned by incredible experiences and satisfaction, also does that double duty of bringing in multiple additional customers through broadcast and interaction with the huge connected community. The more traditional purchased loyalty (coupons, rebates), convenience loyalty (corner market, coﬀee shop), and restricted loyalty (no other game in town) only work for single customer retention. These operate like competitive retention, which means you must win every transaction over competitors. Another reality is that today’s consumers are multichannel, sometimes termed “omnichannel.” This simply means that they may start a product search on a computer at work, continue on their home computer, visit a store for touch and feel activity, then close the transaction on their smartphone. That really complicates the measuring process. Others are walking the aisles in one store, while scanning for better deals on their smartphone in other stores or online. Concurrently, they are asking for the experiences of the community through FourSquare or Yelp, and broadcasting their own experiences on Facebook and Twitter. The common thread here is quality of the customer experience, more so than the quality of customer service, and the impact of that experience on other current and potential customers. Simple customer satisfaction surveys and analytics miss several of these dimensions, and simply are not adequate any more. You need to take advantage of innovative new tools, like the Word of Mouth Index (WoMI) from ForeSee, and the analytic power of Big Data to gain a competitive advantage today, and predict customer behavior for tomorrow. Nobody said it would be easy. How much do you really know about the customer experience with your company? Get busy.

About the Author Martin Zwilling is the Founder and CEO of Startup Professionals, a company that provides products and services to startup founders and small business owners. He writes a daily blog for entrepreneurs, and is also a regular contributor to Forbes, Harvard Business Review, Business Insider, and other business information sites. He recently released his ﬁrst book titled "Do You Have What It Takes To Be An Entrepreneur?" He can be contacted directly at marty@startupprofessionals.com.

New Report

Entrepreneurship May Be Contagious Knowing an entrepreneur may be a big factor for becoming one. But more research might explain what can motivate more people to take the leap.

By Lewis Schiﬀ

recent report from the Ewing Marion Kauﬀman Foundation explores whether or not instances of entrepreneurship would increase if more people had contact with more entrepreneurs. It strikes me that would be the case, based on what I discovered about social contagion while researching my book, Business Brilliant. You're probably already familiar with social contagion theory from the colloquialism, "follow the crowd." Social contagion explains why you would have trouble quitting smoking if many of your friends still smoke. It also explains why you're more likely to try harder at something when you are surrounded by others who are also trying hard; for example, when a team practices for a big game.

COULD ENTREPRENEURSHIP BE VIRAL? The Kauﬀman report considers the potential power of social contagion for entrepreneurship through a survey of 2,000 Americans. It asks the respondents how many of them know an entrepreneur. It further

investigates how many upwardly-mobile entrepreneurs (those with growing businesses) the respondents have contact with. In short, about a third of survey respondents have contact with an entrepreneur and about 15 percent have contact with upwardly-mobile entrepreneurs. The paper ponders if entrepreneurship is contagious--if exposure to entrepreneurs increases the likelihood an individual becomes an entrepreneur. If it were true, a prescription to increase new business creation would be relatively simple. But the paper does not establish a direct correlation between the two; it just shows "that a large number of U.S. residents know entrepreneurs, and that knowing an entrepreneur is possibly a signiﬁcant factor in whether a person is also an entrepreneur."

WHERE MORE SOCIAL RESEARCH SHOULD BE DONE In my view, a diﬀerent area of social research might explain why new

business creation calls for more than just mere exposure. The entrepreneurial journey almost always begins with a deep valley of hardship. Most new business owners have to forego corporate salaries when they start a new venture and herein lies the problem. Studies reliably show that most people are uncomfortable in situations that necessitate their being the least-aﬄuent member of any group. One famous experiment, repeated many times, shows that most people say they would feel happier earning $33,000 in a workplace where everyone else makes $30,000 than if they were earning $35,000 in a workplace where everyone else makes $38,000. They would be happy to sacriﬁce $3,000 a year in a salary just to enjoy being top dog in a lower-paying workplace. For most people, the prospect of starting at the bottom--where nearly every entrepreneur begins his journey--is so undesirable that no amount of direct social contact with successful business owners will motivate them to take a similar leap.

ABOUT THE AUTHOR LEWIS SCHIFF is the executive director of the Inc. Business Owners Council. His latest book is Business Brilliant: Surprising Lessons from the Greatest Self-Made Business Icons. In November, he will co-lead the ﬁrst-ever Inc. Riders Summit, a three-day motorcycle road trip for entrepreneurs through the Nevada desert. @lewisschiﬀ

HOW MANY CO-FOUNDERS SHOULD YOUR STARTUP HAVE? By Gleb Budman Backblaze CEO Gleb Budman embodies the entrepreneurial spirit. He started his �irst business at age 15 and ran it until he went off to college at UC Berkeley. When Gleb was in business school at Berkeley he founded NetRelevance – his professors liked his business plan so much that they used it in the Haas School of Business as a teaching tool. Two more entrepreneurial ventures later, Gleb cofounded online backup provider Backblaze to help consumers affordably, automatically, and safely back up their data.

What are the pros and cons of starting a business alone versus with cofounders? How many founders are too many? The required number of cofounders for success is: “Zero” – You don’t need a cofounder. You are the founder, the visionary, the uber-entrepreneur. Why would you want to have someone second-guessing you? Hire everyone you need as

an employee. “One” – You have to have a cofounder. VCs don’t fund sole founders and, if you are alone, you’ve either got too much ego or you can’t convince someone to join you. “Two” – You have to have three founders. Decisions need to be made fast in startups and you have to ensure you can have a tie-breaker.

I’ve heard all of these and you probably have too. Each of these is periodically spouted as the required answer. You can’t be successful unless you are the single visionary, or unless you have a cofounder, or unless there are three of you.

early on we would have months when the company did not have enough cash from sales to buy the additional servers it needed. The cofounders would take out their credit cards to bridge the temporary gap.

You know what is deﬁnitely the wrong number of cofounders? Five.

2. BREAK – You Need One At Some Point.

“Too many.”

It’s easier to take that vacation when you know someone will be at the oﬃce that will care the way you do and share your goals. A couple years in, I got married and left on my honeymoon for two weeks to Kenya – where I had no email or phone connectivity much of the time. I could enjoy my honeymoon knowing the company was in good hands with the other co-founders, and an even better team.

“Impossible to manage.” “Too dilutive.” Five is definitely the wrong answer. At least, that’s what I’ve heard. Yet five is also the number of cofounders of Backblaze. We started our online backup company with five in 2008, and all five are still running the company today. By sheer coincidence, it is also the number of cofounders of Excite, which is where the Backblaze cofounders met. Excite became the fourth most popular website in the late 90’s, so maybe five is a great number. Of course, Excite also went bankrupt in 2001, so maybe five is a terrible number? After being part of a team of five that co-founded a fairly successful company and still have the original team together after half a decade, here’s what I learned about having cofounders.

PROS 1. SHOULDER – Not To Cry On, But To Lean On. When things have to happen, your co-founders are the ones who will step up. Since we bootstrapped Backblaze,

3. VARIETY – I Believe What I Believe. Sometimes I’m wrong. My cofounders, who share my core goals, will still say “You’re wrong.” And sometimes, they’re right. After launching our Windows online backup service ﬁve years ago, our CTO pitched that we should focus on launching our Mac version next. At that time, Mac computers made up a mere 6 percent of the market and I argued we needed to focus on other areas. He convinced me to ship the Mac version and it has since become over 60 percent of our customer base. As CEO of a company, a strong – yet sometimes stubborn – vision is a requirement. But having cofounders who can give perspective can help you see a diﬀerent side of the market.

4. SKILLS – I Do Product, Business, Marketing. Three of my cofounders are engineering masterminds (with various skillsets.) The last is a designer. Each of these skill sets was key in building the company. It’s obvious that a company building an online backup service and its own cloud storage platform requires strong engineering talent. It may be obvious that “build it and they will come” doesn’t work, thus requiring marketing. But having a design cofounder was critical in getting the large volume of work on the website, product, marketing material, done; iterating quickly; and keeping a consistent aesthetic to the brand.

5. COMMITMENT – Startups Are A Wild Ride Of Ups And Downs. Cofounders stick through the tough times and help each other cushion the ride. To start Backblaze, all five of us committed to a year without salary. That was effectively the seed round. When it became a year-and-a-half, the five co-founders all took the hit to keep the company going. Now imagine doing that alone and still have a company to call your own!

CONS

Whether it was the “support Mac” decision, or determining if we should raise funding, accept an acquisition oﬀer, or a myriad other questions, strong personalities with diﬀerent opinions means unilateral decisions don’t happen. Or if they do, sometimes they happen too late thanks to all the back and forth.

2. DILUTION – bringing on a co-founder likely means you’re splitting your share in half. Starting with three people total? Your company needs to be worth three times more for your equity to be worth the same. We split our stock one-ﬁfth each. Backblaze has to be worth ﬁve times more than if any of us had founded the company itself for our equity to be worth the same.

So, what’s the magic cofounder number? Ultimately, I think cofounders are invaluable. If you can’t get your co-founders on board with a decision, perhaps you don’t have enough data, logic, or conviction. And the likelihood of your company succeeding increases an order of magnitude by having a team of people who are as committed to its success as you are.

1. DECISIONS – As A Founder You Want To Make A Decision And Go.

However, it will not be whether you have one, two, or three cofounders that will drive your company’s fate. It’s who those cofounders are and how you work together.

With cofounders, you need to get people on-board. And sometimes you need to get on-board with their ideas, which is a lot harder than it sounds.

So on your way to becoming the next Microsoft, Google, or Apple, make sure you ﬁnd your Paul Allen, Sergey Brin, or Steve Wozniak.

8 Blunders in How Leaders Think By Mark Sanborn Leader, are unexamined assumptions and outdated thinking holding you back? Leaders need the intellectual courage to challenge their own thinking. And rather than fearing or resisting opposing points of view, leaders need to use those ideas to test their thinking and stimulate new insights. Henry Ford famously said, “Thinking is the hardest work there is, which is probably the reason why so few engage in it.” Thinking well is even harder.

As I work with leaders in organizations large and small, I ﬁnd beliefs and ideas that are popular, but that fall short of the ideal or are just plain wrong. I call them thinking blunders. Here are eight I’ve identiﬁed for you to consider:

SETTLING FOR BEST PRACTICES. Best practices are a ticking time bomb. Today’s best practices are next quarter’s second best practices, and obsolete next year. The only way to win is to look for and develop better practices and next practices – those that change the game and redeﬁne the rules.

LEADING WITH CLICHÉS.

Transformational Leadership or Muddy Boots Leadership or (you ﬁll in the adjective) Leadership—clever cliches aren’t always practical reality and can be oﬀ-putting to followers. Real leadership is based on timeless truths and although the application of those principles often needs to change with the times, they never become cliché. Make sure that your leadership approach is substantive and grounded in the timeless truths.

WASTING TIME AND MONEY ON SOCIAL MEDIA.

Can you honestly say you are driving revenue with the hours you spend on Facebook, Twitter, LinkedIn and the like? Many are wasting time and money on social media simply because they feel a vague compulsion (“We’ve got to have a presence!”). Digital marketing is only effective when it is the right fit for your brand and it is done effectively. Sending more advertising messages through the global web is a waste. Listening to your customers and prospects, engaging them and giving them information they can use–that is what effective leaders do.

MANAGING THE CUSTOMER EXPERIENCE.

4 5

Everyone with customers provides a customer experience—there’s no competitive advantage there. Instead, you’ve got to elevate the experience and give customers something they can’t get elsewhere. That means getting creative in diﬀerentiating how you deliver your products and services in a way that really matters to your customers so that they leave happier (yes, you need to manage their emotions) and tell others.

TRADITIONAL MENTORING. Traditional mentoring is passive: lots of discussing, listening and suggesting. Top performers want and deserve more. Active mentoring is about advocating, questioning and guiding. It is the diﬀerence between telling someone to improve their relationship skills and showing them just how to do it.

AVOIDING CHANGE FOR THE SAKE OF CHANGE.

You’ve heard it said, “Don’t change for the sake of change.” But is that really true? Neomania is underrated and staying the same is the fastest way to get left behind. Sure, purposeful change is best, but even switching things up to reinvigorate the troops trumps slogging along with business as usual. (Watch the typical instant uptick in a sport team’s record when a new coach is brought in for proof that sometimes any change can break a slump.)

PURSUING SINGULAR SOLUTIONS.

Having an exceptional sales eﬀort won’t save you if your customer service and operations suck. Dominant companies know there are a lot of interconnected, moving parts to success. Eﬀective leadership is relentless across all areas and those who demand high performance from a smooth economic engine realize it can only happen if you’re hitting on all cylinders.

IGNORING EMERGING LEADERS.

Even self-starters appreciate a program that will accelerate their development. Don’t leave it up to your best talent to raise their hands and ﬁnd their own way to develop as leaders. Identify your future leaders and invest in their growth with a solid program suited to their needs and the needs of the organization. If you don’t develop your emerging leaders, they’ll ﬁnd someone who will, and it could be a competitor.

Other thinking blunders? What did you once think was true about leadership that you’ve changed your mind about? I invite you to share other thinking blunders that hold leaders back.

About the Author Mark Sanborn, CSP, CPAE, is president of Sanborn & Associates, Inc., an idea studio dedicated to developing leaders in business and in life. Mark is an international bestselling author and noted authority on leadership, team building, customer service and change.

10 SIGNS YOU MIGHT NOT BE READY TO START A BUSINESS By Susan Payton Before you quit your day job and dive into entrepreneurship, take a moment to think about this major decision. While, certainly, becoming a business owner is an exciting endeavor, it’s not for everyone. And it’s a long-term commitment. You’ll pour blood, sweat, tears, and money into a business, and if it doesn’t work out, you won’t recoup that investment. If any of the following ring true, you might not be ready to start a business.

1. YOU’RE PASSIONATE, BUT YOU HAVE NO PLAN.

4. YOU’VE GOT MAJOR LIFE CHANGES HAPPENING.

While passion is a cornerstone of a successful small business, it’s simply not enough. You also need a plan for how you’ll make money and grow your business. If the idea of developing such a plan bores you or stresses you out, it might not be a good ﬁt.

Maybe you just got married. Or had a baby. If you’re in a transitional stage in your life, starting a business will add to the already high levels of stress you’re experiencing. Entrepreneurship might be be er later down the road.

2. YOU DON’T HAVE ANY MONEY.

5. YOU JUST WANT TO BE YOUR OWN BOSS.

Starting a business is not a “get rich quick” endeavor by any stretch of the imagination. It may be months — or even years — before you turn a proﬁt, and in the meantime, you’ll need enough cash to pay your business expenses and your personal expenses.

3. YOU HAVE A REALLY NEAT IDEA, IF ONLY THE MARKET WANTED IT. Unless your idea solves a problem or serves a need, you’ll have a hard time ﬁnding customers for it. Remember the dad from the Gremlins movies? He was constantly inventing solutions where there were no problems. A machine that took an egg out of a bowl and cracked it simply wasn’t something the market clamored for.

If the appeal of not having an overbearing boss to answer to is your driver for starting a business, consider this: your customers will be your new bosses. They’ll dictate what you do and how you do it. If they don’t like what you’re selling, they won’t buy it. And you won’t have the stability of a paycheck as a safety net.

6. YOU’RE THE BREADWINNER IN YOUR FAMILY. Shi ing from one salary to support your family to an erratic, virtually existent entrepreneur’s paycheck is one many families can’t stomach. If your family ﬁnances will suﬀer if you quit your job, wait until you have money saved for this endeavor.

7. YOU HAVE NO EXPERIENCE IN THIS INDUSTRY.

9. YOU DON’T KNOW MUCH ABOUT BUSINESS.

Although you’ve worked as a lawyer for years, you’ve dreamed of opening a cupcake shop. If you’ve got rockstar baking skills, that might help you survive, but if you have no experience in leasing retail space, buying baking supplies, and managing staﬀ, you may ﬁnd yourself struggling.

While you don’t need an MBA to be a business owner, it helps to have a basic understanding of marketing, accounting, management, and ﬁnance. You can take continuing education courses at your local community college, read books and blogs, or simply teach yourself. But without a solid business foundation, your house of cards may crumble quickly.

8. YOU WANT TO DO WHAT YOU LOVE. Why would that be a reason to not start a business, you ask? The truth is, few business owners do that thing they love 40 hours a week. In the cupcake shop example, you may ﬁnd that, while you really enjoy the baking portion of the work, you’re actually doing very li le of that in between your admin responsibilities. You’ll be busy creating employee schedules, making deposits at the bank, and calling your suppliers. Someone else will have to handle the baking.

10. YOU’RE NOT EXCITED ENOUGH. Going back to the ﬁrst example here: you absolutely should be passionate and excited about starting a business. You should be able to see yourself working in that business for decades. You should be willing to do whatever it takes — work 80 hours a week, moonlight while keeping your day job, see your family less — to realize your dreams of business ownership. If you’re not, it’s not worth the pain of starting a business to ﬁnd that out.

About the Author: Susan Payton is the President of Egg Marketing & Communications, an Internet marketing ﬁrm specializing in marketing communications, copywriting and blog posts. She’s also the founder of How to Create a Press Release, a free resource for business owners. She’s wri en three books: DIY Press Releases: Your Guide to Becoming Your Own PR Consultant, 101 Entrepreneur Tips and Internet Marketing Strategies for Entrepreneurs, and has blogged for several sites, including The Marketing Eggspert Blog, as well as CorpNet, Small Business Trends, Chamber of Commerce, and BizLaunch. Follow her on Twi er @eggmarketing. This article originally appeared here. AllBusiness.com is one of the largest online resources for startups and growing businesses, providing essential tools, resources, and expert advice to start, grow, ﬁnance, and manage your business. AllBusiness.com brings you real-world expertise and practical advice from some of the best minds in small business, including our team of AllBusiness Experts.

L OVEwha tyou' rere adi ng?

I fso,f oral i mi t ed t i meONL Y,cl ai m yoursubscr i pt i on t oSuccessf ul St ar t up101. . .

F o rF R E E !

SUCCESSFUL STARTUP 101 Contact Editor: tabitha@successfulstartup101.com

Advertising Inquiries: advertising@successfulstartup101.com

Customer Service: support@successfulstartup101.com successfulstartup101.com/support

Want to contribute? Get all the details here: successfulstartup101.com/how-to-contribute

Have Suggestions? We would LOVE to hear from you! Contact us at: info@successfulstartup101.com