Mon, 17 August 2015
Today we're joined by Dino Dogan, founder of Triberr, who we invited on our podcast and who then took over with a topic of his own. But we were totally on board because Dino wanted to talk about the entrepreneurial journey. Given that we've just started not one but two new businesses, we're loving the topic. If you've ever started – or are thinking of starting – a business, you'll appreciate some of the things we talk about today.
But First, An Announcement
If you've been around reading or listening to our stuff for more than five minutes you know we've always been huge Triberr evangelists. And Ralph has been CTO for a couple of years, but as we take on our new ventures and devote our energy to other projects, it's time for him to step down and focus on our own new projects.
A chapter in our entrepreneurial journey has come to an end. But stay tuned, because we've got some exciting new stuff in the works for content creators. If you write a blog, host a podcast, or produce YouTube videos - that's you!
It's All About The Benjamins
We spoke with a colleague recently who has a lot of great ideas. And she wants to start a business. Multiple businesses. She has a little bit of "take over the world" enthusiasm.
But what we want to know is: how will any one of those ideas make money?
Unless you're independently wealthy and you can keep throwing money at the problem, there are practical realities to running a business.
One of them, of course, is money.
You don't need to be mercenary or evil to think about or want money. You need it to live. To feed yourself and your family. To have a roof over your head. To enjoy some luxuries – including free time!
So while having great ideas is, well… great… you do need to consider how your business will generate revenue.
According to Dino, there are three ways to make money: ads (like big news websites), subscriptions (like your paid account to Hootsuite) or transactions (like most small businesses including restaurants, landscapers, accountants, retailers and more).
You'll need to choose your revenue model from the start, and it can even be a combination.
What Type Of Business Do You Want To Run?
There are two different ways, generally speaking, to approach your business venture.
You can do it with the intent of actually running and owning the business – your business, your rules, your money and investment.
Or you can do it with the intent of getting investment money and inevitably selling it off.
The choice is yours but those two approaches require completely different plans, thinking and strategy.
Once you've got a revenue model and a business model, you've got to take the leap…
Plan, But Don't Stall
Some people jump into business without thinking about how to make money. They have an idea and go with it. That could be a recipe for some very lean days.
Other people think about it – a lot. Maybe too much. They are afraid to make that leap so they stand and stare into that wide open space without taking action.
So if you're working a 9-to-5 and think you're ready to throw your entrepreneurial hat into the ring, plan, but then at some point, leap.
Not Everyone Is Meant To Be An Entrepreneur
Of course, there is the flip side to this conversation, and that's people who love their jobs. They don't want to strike out on their own. They don't want to be "the boss." They want to do their job, collect their salary and live their lives.
And that's great. If that sounds like you then you should never feel like you have to "be an entrepreneur." There can sometimes be a lot of pressure to start your own business, do your own thing. Especially these days when you hear about the latest 12 year old kid who has just struck it rich on YouTube, you may wonder why you couldn't come up with a brilliant idea and do the same thing.
But that's not for everyone. So if you love your job – then do your job!
But Don't Tell Me To Get One
One of the things I heard when I decided to step into business with Ralph was how difficult owning a business would be. How there are no benefits, there's no pension, there's no job security.
And while that's not entirely untrue, it's beside the point.
Yes, starting a business is risky. And exhausting. Fifteen years later, we still work nights and weekends.
And to this day, sometimes people will say to me, "Don’t you wish you just had a job?"
And my answer is always: no.
If you're thinking of starting a business or you own one now, I bet you have heard the same thing. And you can feel free to ignore it with impunity.
It May Be About The Benjamins, But It's Really About The Freedom
I never wanted a 9-to-5 job. As a teacher (in a previous life) I was able to work a more flexible schedule and be creative about what I did. But when, at some point, it stopped being fun… I decided to take the leap into business.
It's been hard, at times absolutely nightmarish, but I wouldn't go back to "a job" even if you… er… paid me.
I now have the freedom to make my own plans, to run the business the way I want to, to be creative, to make the rules. I can take Tuesday off to see a movie even if it means I have to work all day Saturday. But those are the choices I make.
For Ralph, it was about escaping "spreadsheet mentality." The company he worked for was so focused on making money for its investors that they rarely looked past the spreadsheet to the customers they served.
Ralph wanted to control the destiny of his own company and to spend more time thinking about how to serve customers – which ultimately serves the business.
For both of us, it boils down to freedom. Have we give up the freedom to take all weekend off? To quit at 5 without a thought for what we left on our desks? Sure. But our destiny is ours. The money, the success, the customers we earn along the way are ours. And that's important to us.
How Do You Choose A Business Partner?
If you're planning a partnership then you obviously need someone to partner with. And your best buddies are probably not the best option, no matter how many awesome ideas you come up with over beer and burgers.
It may sound counterintuitive but you don't want to partner with someone who has similar interests or skills as you. You want to partner with someone who can complement you.
If you're a great idea person but you can't manage financials for a hill of beans, then you're better off with a financial person on your team. If you're a crack programmer but can't design so much as a red "buy now!" button, then a designer is a great partner for you.
When choosing partners, think about the things you can't – or don't want to – do. Find someone to fill those gaps and who will add value to the business.
Distribute Equity… Well, Equitably.
You may be tempted to keep most of the shares of the business for yourself. After all, it's your idea. Your baby. But when you think about it, you can't have that baby, or nurture it, or help it grow, without your team. Otherwise you wouldn't need them and you could keep the whole business to yourself.
But if you do need them, then their contribution is as important as yours.
Make people invested in the business and motivated to see it succeed. If you're off sipping coladas on a beach because you get paid a giant share, but your partner is slaving away in the office because he's got a teeny bite, that guy is going to get cranky at some point.
And I wouldn't blame him. Everyone wants to feel valued and if you're relying on someone for your success, then value them by giving them an appropriate share in the business.
Ultimately, each person's success is the success of everyone else.
The Difference Between Tech Businesses And Brick And Mortar Shops
If you're starting a technology related business you've got completely different risks than if you were starting a brick and mortar.
For a brick and mortar, you need space, you need to pay rent, and you probably need insurance. You may even need inventory. Maybe that inventory needs warehousing. You might need other things, like vehicles or equipment and you'll certainly need security for your location.
Then there are outside factors to consider. What if other shops around you close? If the neighborhood declines, what does that mean for your business? What about weather? Nearly half of our local clients were wiped out during Hurricane Sandy, never to recover. These factors are outside of your control.
Tech businesses have other risks, primarily revolving around infrastructure, backups and security.
Either way, there are different types of risks to consider, different plans to make. Sometimes you don't know what you don't know, but that's what learning is all about.
MVP Is Your BFF
In the tech world, an MVP refers to a Minimum Viable Product. That's essentially what you need for launch.
Think about Facebook. When it first launched, it was nothing like what it is today. Over the years it added a lot of bells and whistles, new features and different opportunities for you to sort and filter your connections, find and talk with people, open stores, take payments, donate, advertise and more.
There's no way Facebook could have launched with EVERYTHING. I bet someone, somewhere in a back room had big ideas but you first have to get to "minimum."
And minimum doesn't mean "bad." It simply means the most effective feature set that you can put together so that people will want to use your product and so you can start generating revenue. You iterate from there.
And you can apply the same concept to brick and mortar shops, too. Decide what you need to do to differentiate and compete, then add on.
Ralph talks about a cupcake shop we frequent here in Red Bank, New Jersey. It's a "build your own" cupcake shop. You choose the cake, the frosting, the toppings, the filling.
We visited so many times that we eventually wrote down our favorite combinations and ended up with our own menu items in the store.
It's such a great shop, that you might think you could never open your own anywhere near it.
But if you consider how you can be different, even if you don't have all the bells and whistles, you have a much better shot at making it work.
Maybe you focus your products on gluten free cupcakes. You may not be a fancy shop or have as much inventory as the other shop – candy, soda, ice cream and more – but you have something they don't.
And once you have revenue coming in, you can add to your wares. Add a soda fountain. Add a candy counter. Bring in your next best idea and use the revenue you're already generating to make it happen.
Running A Business Is Great. And It Sucks.
Even if you're a solorpreneur I bet you can't do everything yourself. You may hire a VA, or an accountant once a year for taxes.
There are some things that are outside your skill set that you'd be best handing off to someone qualified.
There may be some things you just don't want to do.
Me and bookkeeping? Sworn enemies.
It would be in your best interest to find someone who can – and will – do the things you can't or won't.
Still, sometimes you have to wear ALL the darn hats. That's a reality of running your own business. If you're just starting out or if you don't have the money to pay a salary, you will end up being bookkeeper and secretary, accountant and cat-puke-picker-upper. All while trying to actually do your job.
Nobody said it was easy!
Adapting And Evolving
There's a subtle difference but here's how I see a business working: over time you have to adapt to changing circumstances, evolve to meet big changes… or die.
We talked to Dino about Triberr, and how as a software platform they are constantly adapting to changes in the rules made by the platforms they tap into, like Facebook and Twitter. Today everything is working perfectly and tomorrow it's not – all because a change in technology means someone has to be quick with a change in programming.
Now take the cupcake shop, for example. A few years ago cupcakes were all the rage. They were such a fad you couldn't go ten feet without seeing another cupcake shop. But the fad died down and even some of the biggest name cupcake shops closed up and went out of business.
But they could have evolved – for example, to a bakery or a wedding cake shop.
It's not unlike what we've done in our business. Fifteen years ago we were doing CD-ROM and corporate Jumbotron presentations. Can you imagine if we tried to do that now? So we had to evolve and do something different.
In fact, starting our new companies is part of the evolution, as we take on more software development projects.
People change. Your customers change. What they want, need and ask for will change. And you have to change what you offer to meet those changes in demand, in the economy or in your industry as a whole.
Your Marketing Action Item
From Dino: Write a blog post or do a video or podcast for one specific person. Literally! You get two benefits out of that. One, you have a much bigger shot at converting someone whose questions and problems you have addressed directly. Two, you get the "fly on the wall" effect where other people are curios to hear what you said to that person's question or how you helped solve an individual problem.
Links & Resources
Direct download: 0144-the-entrepreneurial-journey-it-sucks-but-its-awesome-too.mp3
Category:marketing -- posted at: 12:00am EDT