Saturday, January 1, 2011
First Impressions for Start-ups
Each day, Inc.'s reporters scour the Web for the most important and interesting news to entrepreneurs. Here's what we found today:
Think you've mastered first impressions? As the saying goes: You only get one chance. Whether you have an introductory meeting with a prospective client or are pitching a new idea to investors, you don't want to blow it. But maybe it's wise to act a little less informed than you are. Entrepreneur and VC Anthony Tjan recommends in the Huffington Post that you should do solid background research on whomever you will be meeting with—but be careful not to flaunt that knowledge too blatantly. As he says, "Act stupid, win smart." Your goal? "Be armed with the data so that you can answer or direct the conversation appropriately; your goal is not to demonstrate what you know of the person or company but what you had in mind when you first set up the meeting."
Let the tablet media wars begin. Virgin Media mogul Richard Branson announced the launch of Project, an iPad-only style and culture monthly magazine, according to the BBC. The launch of Project comes just a few days after Rupert Murdoch's launch of his iPad newspaper, The Daily, which, as its name implies, is a daily. Project costs about three bucks an issue, and the magazine's editors are confident the magazine will be a success. "It's a quality piece of editorial, so you have to pay for it," the e-magazine's editor in chief noted. Project also launched a blog, where users can read—for free—articles about "really fancy yachts" and a "bicycle drawing machine."
Will Google liberate e-books from tablets? That's what The Wall Street Journal is reporting, anyway. Although Google had planned on launching Google Editions, an e-book retailer, this summer, legal negotiations have delayed progress, the story reports. Now, though, sources say Google has its contracts in order and will be able to launch in the U.S. by the end of the year. Google product management director Scott Duggall explained the delay to the Journal saying, "Because of the complexity of this project, we didn't want to come out with something that wasn't thorough." Unlike Kindle's e-books, which can only be purchased on Amazon.com, Google Editions e-books can be purchased on Google or other online retailers, and The American Booksellers Association predicts that more than 200 independent bookstores in the country could sign up as partners. The hope is to free e-books from the confines of tablets "by offering an open, 'read anywhere' model." Funny, we thought that's what books were for.
Behind Groupon's expansion strategy. The Web is abuzz today with theories, suspicions, and estimations at what makes up Groupon's $6 billion buyout by Google. Mashable first took a look at Groupon's expansion strategy, which includes new features like Groupon Stores (that lets shop owners set up virtual stores with as many deals as they want) and the Deal Feed (a personalized deal stream for customers). But Inc.'s Max Chafkin is a little more dubious. He says the bid stems from Google's desire to secure local advertising dollars—dollars that Groupon has partially wrested from Google's grasp. And in a similar vein, a New York Times Dealbook blog wonders whether the price is a little too steep. "A multibillion-dolar valuation for a company that is in a business with virtually no barriers to entry and is younger than my toddler is absurd," wrote Sucharita Mulpuru, a Forrester Research analyst, in a note to clients. At last the article contends that Groupon's viral, on-the-ground approach could give Google a lift in social networking, an area where the company has struggled to make any significant headway thus far.
Twitter now worth $4 billion. The bidding war to buy a piece of the microblogging startup has driven its valuation up by nearly a billion dollars, writes Michael Arrington in TechCrunch. Leading the charge is John Doerr, a partner at the Silicon Valley venture capital firm Kleiner Perkins, who is "acting something like a dog with bone that won't let go." Russian holding firm Digital Sky Technologies and venture fund Andreessen Horowitz are also reportedly sniffing around, but unless another concrete bidder steps up, Kleiner has all but sealed the deal, says Arrington.
Doing holiday bonuses right. Around the holidays, who is better to reward, employees or customers? While more small businesses planned to give gifts to their customers than their employees this year, Rosalind Resnick writes in The Wall Street Journal that making sure members of your team are taken care of around the holidays is "not just the right thing to do ... it's good business." The former entrepreneur and real-estate developer continues: "The next time I ask one of my guys to go the extra mile for my tenants, I can reasonably expect that the answer will be yes." Need specific gift advice? Check out Inc.com's guide to employee gifts. Anyone out there have extra tips for making employees happy around the holidays? Leave 'em in the comments.
More from Inc. magazine:
Get this delivered to your inbox.
Follow us on Twitter.
Follow us on Tumblr.
Like us on Facebook.
How to Get Financing When Banks Won't Lend
The recession may be over, but traditional forms of business financing remain stubbornly difficult to nail down: A recent Pepperdine University survey showed that though banks report an increase in the volume and quality of loan applications, they continue to turn down the vast majority of loan applications that they review. It's no surprise, then, that businesses are turning to less conventional means of raising money. One increasingly useful technique is finding customers willing to make small investments to fund start-up operations and expansion. Here are three variations on that theme.
Direct Public Offerings
DPOs have existed for decades as a way for small businesses to raise capital from wealthy individuals. The hurdles were high, however, and the rules were arcane, making the technique impractical for most businesses. In 1989, the requirements changed; a decade later, they were greatly simplified. Regulators in 47 states have been allowing businesses to raise up to $1 million a year through shares priced as low as $1 using a financing technique called the small corporate offering registration, or SCOR. When bank lending was easy, SCOR was seldom used. Now, all sorts of businesses are using SCOR to invite customers to invest via their websites or product labels.
Gary Steszewski is using this method to get expansion funding for his Buffalo-based company, CityMade. CityMade's websites sell locally made gifts and souvenirs online from 12 cities, including New York; Washington, D.C.; and Toronto. Steszewski recently raised $250,000 through SCOR to launch 14 new "MadeIn" sites. Because he registered with New York State, only New York–based customers can invest. There's one major drawback for investors, though: They are unlikely to see a payout on their investment unless the company is acquired or goes public.
CSA Financing
Community supported agriculture, or CSA, programs were first popularized by eco-conscious foodies; they pay local farmers a lump sum at the beginning of the year in exchange for regular deliveries of produce. Now, the model has been extended to nonproduce businesses. In the past five years, LocalHarvest.org, a database of local businesses around the country, has seen CSAs triple to 3,732. Director Erin Barnett says that's owing in part to "creative entrepreneurs" who have played with the concept. There is nothing preventing any business from adopting the technique, says Barnett. "The CSA model is infinitely variable," she says. Already, there are winery CSAs, soap CSAs, bacon CSAs, even art CSAs (members pay up front for at least three months' worth of monthly "art-in-a-box" installments). Susan Gibbs turned her part-time hobby into a going business when she financed her yarn company, Juniper Moon Farm, with CSA investments: Members pay $175 per share in return for about 1,800 yards of yarn a year. "I think it can work for a lot of industries," says Gibbs. "It just requires a customer base that's passionate."
Fan Funding
The most popular type of customer financing is probably fan funding, which involves websites like Kickstarter soliciting donations to finance creative projects. Now, however, some fan funding sites are offering customers a return on their investment. FashionStake.com, co-founded by Vivian Weng and Daniel Gulati, lets designers upload their collections along with their production funding goals. Customers can then invest $50 or $500 in the designs they like most. When a designer meets his or her financing goal, the collection goes up for sale on FashionStake's site. The better it sells, the more store credit investors get. The New York City–based site launched in September, and it has raised about $75,000 from 500 customers.
5 Key Steps To More Abundance and Prosperity in 2011
Looking at the stack of bills. Watching the money drain out of your checking account. Dodging bill collectors.
Does this sound familiar?
Top Twitter Techniques (or 9 Good Excuses if you want to Ignore Twitter)
In my view Twitter, like many marketing and social media tools, is basically a stage. How you present yourself upon it depends on what talents you have and what you're trying to accomplish.
Below, I've outlined 9 methods of interacting on Twitter. This list should either allow you to comfortably ignore Twitter because none of these methods of interaction are feasible or meaningful for you, or recognize an opportunity for yourself or your business.
The Personality
This applies both to actual celebrities, and people who are building a brand that can be clearly defined as having a "voice". People like Perez Hilton, Oprah Winfrey and Tony Hsieh of Zappos immediately come to mind. All of them have Twitter feeds and each of them has a very distinct voice. "In waiting room at doctor's office. In addition to magazines, they should offer a selection of paint so people can watch it dry." A recent post from the CEO of a company with projected 2008 revenues of $1 billion. People follow these feeds for a variety of reasons but mainly because they receive something emotionally satisfying from the postings.
The Guide
The Guide is typically a person or people assigned to seek out messages posted by people who have a question related to your business, products or services. Here is a great case study of a company who did just that and has shared their results. Note that to maximize their efforts they have someone spending 30 minutes per day on Twitter in this role.
The Brand Watchdog
Someone proactively seeks out mentions of their company name or product name and responds personally to each post. Two companies that immediately come to mind are GeekSquad Founder Robert Stephens (thanks @DanielRiveong and @britopian) and ComCast's Director of Digital Care Frank Eliason @ComCastCares. Companies can win big brownie points by having very senior staff members respond to customer service questions. The idea here is that by providing direct access to someone who really knows what they're talking about, companies can prevent damage to their brand from disappointed customers.
I Can Email You With the Next Update
Click here to get notified of new posts to "The Internet Strategist" by Email
The Customer Support Rep
Very similar to the Brand Watchdog, this too is focused on watching for and responding to customer service questions. But while I would put Frank Eliason in the Brand Watchdog category, this category is usually filled by the unsung Twitter heros (Twiroes?). They are likely handling questions in other (non-Twitter) venues and have added Twitter to the ways they communicate. The catch here is that the expectation is that Twitter customer service reps will actually help you resolve your issue. We'll see how long that lasts!
The Publisher
People and companies will often use Twitter as a way to simply feed followers information about their area of influence. A lot of news is now breaking on Twitter before it hits major publications. But you don't have to be first, just relevant and somewhat consistent. A really interesting take on the publisher model is The Brooklyn Museum who is monetizing their social content and their community by offering memberships to a "socially networked museum membership" for $20 per year.
The Promotion Channel
Unfortunately I think both spammers and ecommerce sites fit into this category. But the ecommerce sites I've seen use Twitter in interesting ways to do promotion and inform customers about products they are interested in. Take a look at Amazon on Twitter. Their feed is a little bit all over the place in terms of content and they don't have an individual person that followers can connect with (which limits conversation and can limit your follower numbers) but they've still managed to collect almost 4,000 followers as of this article. Contests, Twitter only discount codes, free giveaways are all part of the promotion channel arsenal.
The Conversationalist
Many of the most popular "tweet"ers are those who actively engage with their followers. In essence this is what really makes Twitter unique as a communication tool, although it's also what scares the bejeezus out of small business owners. Being the Conversationalist can be very time consuming, but the rewards are high in terms of building a loyal following and truly connecting with people who are interested in what you have to offer, from whom you are interested in learning and with whom you can build strategic relationships. We're talking several posts per day many of which are directed at specific people.
The Curious
There are many people who don't post to twitter at all. They use it as an information resource, watching the "twitter trending topics" to "crowd source" their news or following people they find interesting or informative. This can be a great way to use Twitter and learn a thing or two. The key here is to be careful about who you follow — you want people with a high signal to noise ratio usually with far fewer posts but each post is a gem.
The Entertained
Again here it's not about posting information but consuming it. There are many feeds on Twitter (The Onion is one of my favorites) that are purely about entertainment, putting a smile on your face or making you think.
As you'll no doubt notice, some Twitter strategies combine these methods.
The Conclusion
If you are not interested in any of the 9 methods above then Twitter is probably not for you. But really the best way to find out is to use it. Sign yourself up - it takes only a couple of minutes to sign up and if you're looking for somewhere to start, start following me and then look at other people who follow me. You don't have to know someone to follow them. You can even sign up under what I like to call an "incognito name" — a name that won't be associated with you or company so that you can experiment without worrying about making an embarrassing mistake. After a few weeks drop the incognito account and sign up with accounts branded for you and/or your company.
The Future?
On a more serious note, I can't help noting how many meaningful events have occurred in the last few weeks, and the very different way we experienced them. I am struck with the realization that every real moment can be played out near real time on a global scale.
These little 12-17 inch screens and keyboards we've become so intimate with, that bring close the lives of far away friends, over the last two weeks opened up a world of individuals sharing their grief, and made a political maelstrom that might before have seemed "far away," personal in a way many of us have never experienced.
As people, we know instinctively that how the world makes it's way into our lives is changing, dramatically. And not just how it reaches us, but where it comes from, who filters it (if anyone), how we seek it out and find it, that we can share it, comment on it, alter it and then pass it along. As people we struggle with concepts like authenticity while trying to grasp the ever-slipping confines of the personal within the ever-growing realm of the public.
And while those lines are being blurred and redefined, as businesses we must be careful not to loose sight of the very human, once personal context in which we're operating more and more. I think it's keeping sight of this context which in part keeps us authentic and relevant - regardless of the tools we use. While some debate whether or not Twitter is useful, others are simply putting it to work, filling a need, and reaching an audience they would never have reached before.
I thought something I read recently put it well:
"Asking when Twitter will end is like saying, 'When will the cell phone fad end'?...The value of cell phones can't end, it only can be replaced by something that provides the same value and more. Once we have a capability, we never want it taken away from us." -- David Spark, founder of Spark Media SolutionsWhile you definitely can learn from how others are using tools like Twitter both successfully and unsuccessfully, keep in mind that a) the communication is still yours b) the content is still yours c) everyone is still figuring this stuff out so don't be afraid to dip your toe in the water and don't be afraid to make a few mistakes d) do try to remember that there are humans on the other side of that message. There is something they probably want and want from you. What is it that they're looking for?
Related Articles:
Facebook Demystified: Profiles and Pages and Groups (oh my)A Guide to Social Media Tools and their UsesThe Weakest Link - Your Social Media Marketing "Killer App"The Marketing Skills You Can Learn from Obama
5 Best Places to Start a Business in Philadelphia
Philadelphia is a city as diverse as it is full of opportunity. Its state tax breaks reward start-ups in the city's under-served areas, while its suburban neighborhoods offer business owners a wealth of affluent clientele right in their backyards, making Philly and its surrounding suburbs a good fit for businesses targeting any demographic. And while there are plenty of places to choose from, we've broken down the top five places you should check out before starting your business in the City of Brotherly Love.
The waterfront neighborhood, which is located 15 minutes away from just about anywhere, is only three-quarters of a mile long, but is chock full of business - with 49 retailers, 32 restaurants and 52 service-related businesses. During weekdays, Manayunk primarily draws a wealthy female clientele, but the nights and weekends belong to young couples and bar hopping twenty-somethings. Perhaps the biggest perk, aside from the affordable rents, is access to the Manayunk Development Corporation, which works hand-in-hand with local business owners, helping them with everything from technical assistance to seeking grant funding.
This town is every suburbanite's dream. Two train stations offer easy access to Center City and downtown Philadelphia, and its cobblestone streets are lined with shops and restaurants. The market skews toward an affluent, environmentally conscious customer base: Residents grocery shop at the local farmers market or a new food co-op. For apparel, they turn to quirky stores like Artisans on the Avenue and the fair-trade retailer Ten Thousand Villages. The district’s Go Green initiative was recently formed to promote sustainable businesses in the neighborhood and the nearby Morris Arboretum is a 92-acre garden.
If the success of Facebook has taught us anything, it's that marketing a business to the college demographic is a brilliant strategy. University City offers the benefits of being close to Center City's business district, while still offering business owners a captive audience among some 50,000 students from University of Pennsylvania and Drexel University. Because it's one of the most ethnically and socioeconomically diverse communities in Philadelphia, the state has designated several acres of University City as Keystone Opportunity Zones, where business owners are eligible for state and local tax breaks.
This neighborhood is truly a magnet for businesses in finance, insurance, real estate, engineering and legal services. According to the Central Philadelphia Development Corporation, Center City has 9,000 businesses in the district, as well as 92,000 residents, and, because it's positioned just a near the Pennsylvania Convention Center, the area is easily accessible for visiting business travelers. The neighborhood has a lively retail scene, with 2,400 shops in the area, and its famed Avenue of the Arts draws loads of foot traffic to the 217 restaurants, and 59 bars and nightclubs.
One of the most historically wealthy regions of the Philadelphia area, the Main Line is a lucrative starting ground for small businesses. The area consists of several smaller towns, including Radnor, Haverford, Villanova, and Wayne, where Urban Outfitters president Richard Hayne planted the first Anthropologie store in 1992. That store, which still exists today, is just one of many upscale retailers populating Radnor Township, which, according to the U.S. Census Bureau, had an estimated median household income of $129,773 between 2006 and 2008.