Folks, I have a final, a project, we’re closing on a house Tuesday and I need to do some remodeling before we move in to it in a couple of weeks. We’ll be taking a couple of week hiatus from posting here until all that clears. See you soon!
We’ve been talking about different channels to get the word out about a small business idea. A new one today is to be awesome.
An Awesome Small Business Idea
The Awesome Foundation is another way to gain publicity for a small business idea. The basic idea is that a board of 10 trustees meets once a month to award $1000 to an awesome local idea.
To be a trustee, you pledge to contribute $100 each month to keep your local chapter up and running. Then you get to vote on the most awesome idea of the month. Chapters are limited to 10 trustees to allow the possibility for consensus.
While there aren’t any numbers on the potential ROI of investing time in such an organization, there’s no doubt that the good karma from giving away $100 every month to something awesome would not only be great fun but get your name out in the community.
While some with a small business idea may want to get involved with the organization as fund seekers, it seems like a greater gain could be had by being a trustee. Most local small businesses can benefit from giving back to the community and $100 a month is within the advertising budgets of most.
The only criteria for winning an awesome grant is that the idea be awesome. Any individual, group or organization can submit an idea.
A Local Awesome Small Business Idea
One article featured the Halifax chapter of the foundation. They hold a market where trustees – 60 in all – circulate and talk to pre-screened awesome ideas.
From the article, it appear they pay $400 at a time to be a trustee. The article says there are only 30 trustee slots so it’s not clear exactly how they’re structured.
“Sometimes, it’s just a small amount of money someone needs to advance a great idea forward … or to see if their idea will make it,” Awesome Halifax co-founder Colette O’Hara said in a recent interview.
“That’s what this is really about, getting enough money in somebody’s hands to get to the next baby step they need to take. It’s not about huge amounts of funding; it’s to keep progress happening.”
Crowdsourcing for a Small Business Idea
As crowdsourcing takes off to fund a small business idea, we’ll have more varieties of it. While The Awesome Foundation seems to be a smaller scale version of it, it’s still enough to get interest and get people thinking about awesome ideas.
If you have a small business, you can go to the The Awesome Foundation’s website and look up your local chapter. Many major cities still have not formed chapters so there’s plenty of opportunity yet to get publicity and fund a small business idea.
Today’s small business idea is on how to frame that great small business idea. After you have a USP, you need a way to tell everyone about it.
Let’s look at different ways to frame a hook as well as a great way to distribute those hooks.
Media Hooks for a Small Business Idea
CBS posted an article with 15 hooks you can use to get publicity for a small business idea.
They include using a news event, sharing expert advice, coming up with a Hall of Fame to honor people, having a contest, making a prediction, holding an event, starting a petition, busting myths, sharing recipes, sharing relevant historical events, making a list as this article did, making a quiz, writing an editorial, or starting an index to rank something.
This was a part two article so there are further ways to promote your small business idea in the previous article as well.
YouTube for a Small Business Idea
Another article today was on ways to share your small business idea through YouTube with relevant examples.
They reported that YouTube has said that it’s “how-to” channel has become it’s most popular channel showing that businesses are catching on to the power of consumer education prior to making the sale.
Their categories for video production are branding, consumer education, how-to videos, selling benefits related to the product, problem-solution, as your main service (Khan Academy), product demonstrations, advice, tutorials, or as something intended to go viral.
Be sure and watch a few of the videos to understand the concepts.
You probably know from personal experience that you hate watching most commercials but you’ll watch a how-to video no, problem. One of the major uses of the internet is to find solutions to problems and how-to videos are often the easiest to use.
Successful Small Business Idea Videos
The list of businesses that have become successful through promoting how-to videos is long indeed. If you combine these two concepts above – finding a hook and creating videos for customers’ enrichment – there’s no limit to where you can take your small business idea.
There was talk that the JOBS Act would move small business startups away from venture capitalists and toward crowdsourcing options. It appears it’s not an either/or situation but both/and.
Funding Stats Regarding Small Business Startups
From a survey done by national law firm Dorsey & Whitney (originally done in 2010 and recently updated), we learn that:
- 36% of small business startups in major metropolitan areas did a round of funding (29% prior in 2010)
- 30% of CEOs expect to raise between $1M to $5M (23% prior)
- 15% used business incubators (9% prior)
- CEOs strongly preferred to seek funding from established relationships (i.e. not crowdsourcing)
Another Crowdsourced Option For Small Business Startups
While I mentioned crowdsourced consulting in an earlier post, it seems we have another similar company.
GenCrowd is also provides crowdsourced outsourcing for small business startups. It’s unclear from their website whether they’re familiar with their competitors or what their USP might be over them.
They have a similar story from the previously mentioned AskYourUsers.com.
“The volume of work that startups have to do, atleast initially – from idea brainstorming and validation, brand naming, tagline and slogan generation, logo design, web design and development, content and copywriting, all the way down to website and usability testing, SEO and marketing, analytics research, customer service, and a whole bunch of other issues – can take a real toll on people and businesses alike,” said Barun Rath, founder of GenCrowd.
“Going through the steps, GenCrowd was conceptualized from these issues that we personally faced when starting a business – we were looking for resources to provide us with different ideas and perspectives on different aspects regarding the business we were working on at the time. And so, the idea behind GenCrowd was formed – an online marketplace allowing people to crowdsource ideas, content, and feedback for their business needs.”
GenCrowd seems different in that it allows “blind” listings which means you can solicit feedback without any of the experts being able to see each others’ solutions. Of course it’s hard to beat AYU’s ties with LinkedIn – whatever that benefit might be.
It seems to go without saying that we prefer working with people we know when that’s an option. But to extrapolate that to the conclusion that crowdsourcing isn’t gaining traction does small business startups a disservice. It’s zero sum thinking.
Before, venture capitalists were the main game in town. You may have got funding based on your relationships with them. Of course you had to have a solid idea too. But the relationship needed to be there.
With crowdsourcing, a whole new source of funding is opening up to the market. People without prior VC relationships will now have options where they can prove their idea and expertise.
Small Business Startups Demographics
Of course there’s the debate about preferred startup CEO ages. If anyone does a demographic study on that, I’d like to know. One I saw said the average age of startup CEOs from 1995-2005 was 39 but that older professionals start different kinds of companies than younger ones.
Clearly the older ones are going to be the ones more likely to seek funding and in all likelihood, the younger ones be more inclined to pursue crowdsourcing for small business startups.
Small business or health care?
Most people are aware of the impact of baby boomers on the health care system. If you’re looking for stable employment, it hard to do better than working in health care as the baby boomer generation needs more and more care.
Another implication most people aren’t aware of is the boomers small business market. Yes, we realize they’re looking to retire in the next few years but most don’t realize that means the ones that own small businesses that they operate may be looking to sell.
In fact that’s what we’re see happening now already.
More Small Business For Sale, Lower Prices
Bizbuysell.com is a site that lists small businesses for sale. They report that while selling activity has increased to 2008 levels, prices have fallen 3.2% in the last quarter:
“Business owners are continuing to adjust their pricing in order to expedite a sale,” said Mike Handelsman, group general manager of BizBuySell.com. “While some may still be holding out for an economic recovery, many more are trying to exit at acceptable prices, even if it means settling for a lower number than they originally expected.”
Small Business Selling Tips
If you are a small business owner looking to sell, the WSJ has some tips for you based on common mistakes. Most of them are to do the opposite of the mistake.
Mistake: The business is dependent on you.
Mistake: Not planning for tax implications of the sale.
Mistake: Not getting a realistic appraisal.
Mistake: Only looking at the bottom line of an offer.
Mistake: Not hiring experienced professionals to handle the deal.
Mistake: Not being prepared for the emotional consequences of selling the small business.
One small business idea is clearly then to be any sort of professional who can assist a small business owner with the sale of their business. Alternately, now and in the near future will probably be a great time to acquire a cash flowing small business.
There were a couple of articles today on starting as an entrepreneur. One was geared toward showing investors the entrepreneur is committed. The other was on ways NOT to start as an entrepreneur.
Both are useful as self examination tools even if you’re not currently starting a business. If you have an existing business, you can consider whether you still have what it takes to make it as an entrepreneur.
Showing Commitment as an Entrepreneur
Since investors at the beginning of a venture are betting on the small business idea rather than an established system, they want to know the idea is fully supported by the person who came up with it.
These are some ways investors judge someone to be fully committed to his idea. Even if you’re not looking for venture capital, this is a good way to examine yourself to see if you’re giving it enough to really get things going and grow your small business.
- All or nothing – not halfway or as one of many efforts
- Sacrifices – going with less especially to get the ball rolling
- Hidden motivations – they want to see you have other reasons to make it work such as family obligations or wanting to make your first big mark on the world
- Skin in the game – you have something vested in a good outcome
- Characteristics – you can function as Gerber’s 3 types – technician, manager and entrepreneur
- Patience – you’re willing to reinvest and work toward long term growth
- Equity hoarders – you’re willing to save money to expand the business rather than put it all back out to investors
- Determination – see quote below:
One has to admire entrepreneurs who are willing to have 10 or 20 rejections for every lead they receive. Nothing creates more entrepreneurial believability than a passionate belief in an opportunity. That does not necessarily mean the venture is a good investment, but I would much rather back entrepreneurs who are willing to spend years on an opportunity, and show genuine resilience, rather than those who give up after a few setbacks. The ability to recover from failure, in a country that, sadly, has little tolerance for honest entrepreneurial failure, is especially impressive.
How NOT to Start as an Entrepreneur
Another article goes into the wrong ways to do it:
- Don’t start a business in a field you’re unfamiliar with
- Don’t try to start it entirely on your own (find professionals, partners and mentors)
- Not adapting to the changing market
- Being afraid to make mistakes (that’s one of the best ways to learn)
- Being risk adverse (you’re probably not if you’re starting your own business)
- Don’t give up if you run short on cash
While it’s entirely possible to start a business without going all in, putting it all on the line is what people want to see if they’re going to give you money to do it. They want the best opportunity for success.
In truth though, many small businesses are started by individuals with their own money part-time. That’s part of what makes business great – there are lots of ways to get it right.
What you can’t do is start without a clear idea of how you’ll connect with and provide value to your customers. Without a way to provide value or make a sale, it doesn’t matter if you have 100 people working on it full time. But then that’s probably the first rule of being an entrepreneur and you probably already know that.
If you haven’t already seen it, Caine’s Arcade is making it’s way around the internet with already more than 5 million views. While it’s not necessarily a great small business idea you’d want to pursue yourself, it reminds us the entrepreneurial spirit is alive and well.
There was an article today on bringing the spark back to your small business ideas.
Small Business Ideas versus Burnout
The first point was to clarify that we’re not talking about burnout. Getting bored or tired of your own small business ideas is a sure way to see the business be stuck at lukewarm and eventually fail. If that’s the case, then you need to reconsider why you got into business in the first place.
If it’s lack of clarity about the small business ideas themselves, then the advice was to reconnect with the unique selling proposition (or form one if it hadn’t already been defined). If you can’t answer why people should do business with you, then your customers probably can’t either and might find someone that can.
A solid USP means that you do something better or different than your competitors. And for the most part, that shouldn’t be as a low cost provider unless you like getting squashed by Wal-Mart or Amazon.
Your business’ branding is all about what existing and prospective customers think when they see or hear about your company. It comes from a number of things: your products and services, your physical presence, advertising, packaging, online appearance, reputation, logo and company name.
There were also a number of small business ideas given on various USPs including excellent customer service, serial innovation, and specialization.
More Small Business Ideas on Keeping It Fresh
Perhaps not coincidentally, the Small Business Administration is offering a webinar this week on keeping small business ideas fresh. It’s Thursday, April 26th, 2012 at 1pm ET. If you’ve missed it by the time you read this, they’ll probably have other webinars that might interest you.
The Unique Selling Proposition is arguably the most important factor for small business ideas. Once that’s worked out, everything else flows from there. A clear, strong USP would preclude ever needing to keep it fresh.
Customers would become raving fans and that’s exciting in itself. A USP may not seem as sexy as say, getting mobile devices and apps rolled out, but in the end, without a USP you’d find there weren’t clear small business ideas to communicate in the social media sphere anyway.
Askyourusers.com is a new crowdsourced solution among small business ideas. It’s a new twist on crowdsourcing that can help facilitate the market research process on a smaller budget.
Prior to this small business idea, market research has been conducted by in-person focus groups, recruiting from Craigslist and formal surveys.
“Micro-Consulting” For Small Business Ideas
Now, entrepreneurs will be able to get “micro-consultations” for their small business ideas. They will be 15 minutes duration for about $22 on average. It’s a quick way to vet small business ideas.
Small Business Ideas Marketing Research
Per their website, other uses are usability testing, professional advice, general advice or small business idea validation. They initially plan to find users through LinkedIn.
Said founder Amelia Dunne:
But after a month of development, we were still trying to validate the idea in order to feel comfortable spending our time and money building the prototype,” she says. “The validation process was time consuming, expensive and we weren’t finding the right people to talk with or getting objective feedback. AskYourUsers.com is the tool we wished we could use – but it didn’t exist. We determined that the value in it made AskYourUsers.com worth developing even if only for our own use. Quickly, it made clear business sense as well. We were surprised to learn how inefficiently other startups were conducting their market research, holding focus groups and learning about their customers’ needs/interests.
Small business ideas that help owners do what they need to do more efficiently at a lower cost will always be welcome innovations. The sweet spot is creating enough value while keeping that value sufficiently uncomplicated.
Most small business owners aren’t going to be doing market research very often so the interface needs to be simple enough that they don’t have to relearn a system every time they need something.
From the look of the website, AskYourUsers.com seems to have accomplished the simple interface and made a valuable addition to small business ideas.