Week 5: Marketing Yourself to Market Your Business

As a senior leader within an organization, my experience has been that developing your personal brand adds value to your business. This is even more true for entrepreneurs, as they literally ARE their business. In It’s a Jungle in There, Schussler points out that when investors are considering a business, they are looking at both the viability of the idea as well as their impressions of the person or people leading the project.

The importance of first impressions was reinforced for me recently during a presentation by stylist Lamond Hart of The House of Lamond. He and his colleague Sheena from Alpha Male Nail Care presented to MBA students on style, giving several very helpful tips to help them elevate their personal brand. One thing I was taught early on when preparing for a job interview, many people judge your attention to detail by how well you care for your nails and your shoes. It is no wonder that Mr. Hart partnered with a shoe shine business and nail technician when he opened his salon in Uptown Charlotte. Having these two services within his clothing boutique is genius! Not only do all three businesses benefit from the patrons of the others, all three business compliment the others to result in a well styled gentleman.

Another great take-away for me from this presentation was that professional does not have to be boring. The sock styles of Canadian Prime Minster, Justin Trudeau are a great example of this. He is always well dressed, but the pop of color found in his sock choices have shown that he has a bit of flair and personality. Mr. Hart suggested that a colorful pocket square or unique lapel pin can make a similar impact.

Career experts regularly point to the importance of a good hand shake and the first and last impression it can leave with those you meet. The balance of firm, but not bone crushing, is not easy for everyone to master. This is particularly true when you are nervous and your mind is on the pitch you are about to make. I recommend to my students that they actively practice their handshake and not take for granted that what they do naturally is fine. The feedback you receive on this tiny action could dramatically impact the impression you leave.

Schussler spends several pages in It’s a Jungle in There sharing the value of a unique and memorable business card. With companies like moo.com and Vista Print there is no reason to have boring, unprofessional business cards. Additionally, I strongly recommend that people leverage LinkedIn to connect with people after meeting them. Not only does a LinkedIn profile give you a lot more information about the person you’ve met, but it provides you a tidy way to keep your conversation going after the initial meeting. I use my LinkedIn as a database to help facilitate connections for others as well, but then doing so is part of the brand promise of my institution.

Lastly, I would submit that it is good advice to get involved in service to your industry or profession. Doing so is great for your personal brand, but it is also great for your business. As people know you and associate you with expertise in your field, your business is bound to benefit.

Can Your Customers Find You?

Customers won’t buy what they don’t know exists” says Steven Schussler in It’s a Jungle In There. While this sounds intuitive, I still find the “if you build it, they will come” mentality to be much more common. The expectation by many is that if you have a great product, of course people will be lining up to get it. Unfortunately, this is simply not the case.

I’ve spent a lot of time recently thinking (and worrying) about marketing in my professional role at Wake Forest University. Even though we offer the highest ranked part-time MBA program in North Carolina (according to U.S. News & World Report) people in Charlotte still don’t realize that we have a campus there. Wake Forest University is associated with Winston-Salem, where our main campus is located and where all of our undergraduate and full-time graduate programs are located. Needless to say, our market penetration in Winston-Salem is nearly 100%, since Winston-Salem is Wake Forest. Market awareness of our Charlotte MBA programs is typically about 30%. Part of this challenge is related to the fact that Charlotte has a growing “new professional” population, with lots of people relocating to Charlotte for work. Part of the challenge is also the lack of strategy for our marketing efforts.

Most of my energy recently has been focused on making sure we are appropriately utilizing digital marketing, or as most businesses call it…marketing. In the past, many companies have separated traditional marketing channels like print, television, and radio from digital channels like LinkedIn, Facebook, and paid search on Google. Increasingly, digital marketing is just thought of as marketing, not an “extra” or “bolt on” item to the marketing strategy (Abramovich, 2017). The benefits of using digital platforms for marketing include that it can be very targeted to the types of customers you are looking to reach and analytics are available to track performance.

Roesler (2015), writing for Inc., reminds us the search engine optimization (SEO) is important for digital and offline businesses alike. First, 91% of Google search clicks are made on results found on the first page. This means if you’re on page 2, you almost never get seen. Even companies without websites (YIKES) can be found if they are registered with the various search engines. This can include customer reviews, phone numbers, and directions to your business. It can also point searchers to your social media accounts, like Facebook, Twitter, and Instagram, if that is primarily where you are promoting your product or service.

The moral of the story is that marketing is important and depending on your audience your digital presence may be the most important investment that you make.

Abramovich, G. (2017). Make The Shift From Digital Marketing To Marketing In A Digital World.
Roesler, P. (2015). 4 Reasons why SEO Matters to Business (Even Offline Business).

Week 3: Sweat the Small Stuff

This week’s post is focused on how critical attention to details is to maximize customer satisfaction and perceived quality of your product or service. It’s a Jungle in There author Steven Schussler points out attention to details results in the elevated customer service that can transform a casual patron into a loyal, lifelong customer. The impact that this attention to details can have when investors notice can be huge too.

My experience certainly reinforces the importance of sweating the small stuff. It is hard to know what detail will be the thing that connects with a prospective student considering our MBA. In the same way, you never know what missed detail might turn someone off. I’ve found one of the best ways to do more of what is working and fix the things that aren’t is to have a regular dialogue with prospective students. When you actively listen for the the good, bad, and ugly you can take your business higher and build fully satisfied and committed customers.

Schussler shares the famous reputation of Conrad Hilton and how burned out light bulbs signaled deeper issues in the performance of one of his properties. These small details really do matter, particularly before you’ve established a relationship with your customer. Working with a product that is high price only heightens the expectations of potential candidates, as they are looking for signals that the extra money they’ll spend will result in a greater value over the short-term and longer term.

One example of how we sweat the small stuff is our extended interview day. Each candidate receives a padfolio filled with supporting materials about our program printed in color that they get to keep, whether they are admitted or not. As candidates arrive, we take a photo of them standing with a life-sized Demon Deacon statue in our lobby. At lunch, each of them receives a color copy of their photo in a photo holder with our logo embossed in gold. We offer each person interviewing two formal interviews, sessions with career services and student services, and time with current students and alumni. Each part of this experience reinforces the prestige of the brand, competitiveness (exclusiveness) of admission, quality of the experience, depth our our relationships, and the intimate, personal experience of the program. We feed them lunch, have water in the interview rooms, validate their parking…the details go on and on.

No one in our market does anything even close to this, so when our candidates are considering multiple schools and compare their experiences the differences are very clear. These premium details are not things that everyone values, but for candidates who are looking for signals that a program is “the best” we stand head and shoulders above our competition. That is our goal and our brand promise.

 

Week 2: Risky Business

For the next 7 weeks I will explore the book It’s a Jungle in There: Inspiring Lessons, Hard-Won Insights, and Other Acts of Entrepreneurial Daring by Steven Schussler, the founder of the Rainforest Cafe. This week’s reflection will focus on the role of risk-taking.

I agree with Schussler’s assessment that risk-taking is an essential component for entrepreneurial success. It is a hard fact to accept that as many as 9 out of 10 startups will fail (Patel, 2015). This means that when you launch a new venture you have to believe that your idea is so strong that it will beat the odds and/or be comfortable with the strong possibility that you may experience several failures before you find success.

I think this is the primary reason that so many people with wonderful business or product ideas remain on the sidelines of the entrepreneurship game. The life and family responsibilities that so many of us shoulder make the risk of losing everything too great. The allure of a consistent paycheck and a comfortable life for ourselves and our families makes a corporate job a desirable choice.

Schussler himself failed at his first solo effort, a retail store selling restored nostalgia items called Juke Box Saturday Night. He lost his home, his company truck was repossessed, and he ended up living in a 9×12 foot office above a nightclub. Foreclosure and bankruptcy did not deter him, as he was able to take the failure of his first business and turned it into a chain of very successful nostalgia themed restaurants.

It is easy to see why those that are more risk averse might be drawn to the “side business” or “side hustle” approach. In these cases, the entrepreneur keeps his or her day job (and steady income) and builds the new business after work and on the weekends. Hull (2014) points out that there are two schools of thought on this. Some believe that to be successful you have to quit your job and put everything you have into your business. Others believe that you can start your business on the side and grow it slowly until it generates enough money that you can leave your full-time job.

For me, it is comforting to know that there are businesses that have been launched on the side and grown to profitability. As someone who is slightly more risk averse, it is hard for me to imagine quitting my job to start a new business even though this means that my business will have to grow more slowly. The trade-offs (for me) are just too great.

 

REFERENCES

Hull, P. (2014). Tips to starting a business on the side.

Patel, N. (2015). 90% of startups fail: Here’s what you need to know about the 10 percent.

 

Week 8: Managing Transitions – Next Level Planning and Thinking

Next Level Planning

Many startups struggle to adapt to the changing circumstances they face once they start to gain some traction and begin growing. Conceptually it makes sense that the skills required when the company is struggling, underfunded, and understaffed might be very different from when the company has investors, a strong leadership team, and is starting to pick up serious steam. The question for the founders is if they were the right leaders for the startup stage only or if they can also adapt and continue to play a valuable role as the company’s needs change. Embedded in that question is whether the founders can yield some of the control they enjoyed to access the funding and leverage the human capital available to shift into growth phase.

It is not unheard up for a self-aware founder to recognize that it is time to make a transition and turn over the reigns to the professional team. More likely, however, is that the board will initiate the transition and the founder will resist. This can put the whole organization at risk, distract the leadership team, and deflate some of the growth that the company is enjoying. A better approach to the selection process is to identify what this stage of the company’s life requires in a leader and carefully avoiding the tendency to either choose someone very similar to the founder or someone who is diametrically opposite.

Open conversations and planning for succession is a best practice. This allows everyone involved to have time to process the change, rather than it coming as a complete shock. Even still, it is likely that it was either misunderstood, not taken seriously, or completely missed by the founder. Ideally, the founder can get ahead of the board and initiate the succession themselves on their terms.

Next Level Thinking

Glenn Soloman’s Fortune article Transitioning from a Startup to a Growth-Stage Company gives some sage advice for startups that are on the brink of transition.

  1. Hidden Gems – Identify who your stars are and what they are doing differently to see if it can be taught to others. Carefully consider if this star is someone who needs/wants to advance or if they are happy being rewarded well for playing their starring role. Doing more of what is working really well can help take things to the next level.
  2. Find your flywheel – Cultivate and nurture sources of rapid growth that you can unleash when needed to propel expansion. Pressure to grow and continuously hit financial targets means you need to have some aces in the hole.
  3. Stay focused – Don’t get distracted from your core business. Stay tuned into the market for growth opportunities, but don’t bet the farm on whatever is new and shiny at the peril of your main business activity .
  4. Professionalize your process – It may be contrary to your startup culture, but finding ways to improve processes and add structure will position the organization for success in the longer term.

 

Week 7: Investor Dilemmas

When all of the financial investment comes from the founders, things are less complex. Although the founders have assumed all of the financial risks by self-funding their venture, they will also maintain control including how the financial rewards are dispersed. Each of the other types of investment  have varying levels of funding accessibility, value to the company, and risks to the founder as pointed out by Wasserman in The Founder’s Dilemmas as outlined below.

Friends and family – Although the size of these investments are small, they are the easiest to secure. Usually these investments don’t add a lot of other value beyond the funding. The risks to the founder are significant. Asking friends and family to invest can send an unprofessional signal. These investments don’t usually come with a lot of formal strings attached, so the possibility that founders might pursue less fruitful ideas is real. The most significant risk is the one to the relationships with each investor. It is good advice to refuse these investments if there is a significant risk of loss, as the risk to the relationship is probably not worth it at that point.

Angel investors – The size of these investments are usually medium to large, as the angel investor is looking to invest his or her personal wealth with a goal of profitability. This type of funding is often more available than you might think (and almost certainly more than friends and family can invest) through networking and angel forums. It is possible that these investors could bring significant business experience and want to be directly involved on the board. Additionally, most angel investors have strong social capital, which you can leverage as needed. Risks associated with angel investors include the potential that oversight and assistance may not be as strong. It is also possible that your angel investor may be difficult to manage. Having angel investors in the mix can make things more challenging later on when looking to add additional investors.

Venture capitalists – Venture capitalists will be looking to invest much larger sums of money, but will expect to be brought in as partners, take an active role on the board, and be in regular communication with the founders. This is the hardest source of funding to access, but sometimes angel investors can facilitate an introduction. This funding is greater and more predictable than that of angel investors. Venture capitalists bring significant social capital to the table. It is a very good sign for the business when it receive VC funding, so the reputation and brand could get a bump as a result. There are risks to the founder related to both wealth and control:

  • Wealth risks – Venture capitalists demand equity stakes in the company. The effect is a diluted stake for the founder. Arrangements regarding liquidation can impact exits from the organization. Typically, founder equity is going to be vested outright, which means that allocation among the teams will also be impacted.
  • Control risks – Venture capitalists may expect additional board seats, which can make the founder’s control of the board weaker. If the VC receives preferred stock, supermajority voting might be a reality and cause conflict related to a differing financial risks from founders.

Commentary:

The lessons from The Founder’s Dilemmas continue to point to the complexity of the decisions a founder faces. On the surface, especially in a cash strapped startup, it would be tempting to accept funding from ANYONE who is willing to invest in your dream. Recognizing the risks and trade-offs associated with each source of investment can really help a founder make careful decisions and negotiate the best possible position for the founders and the team.

It is a reality that a false move with an investor can result in the founders ending up with nothing to compensate them for the hard work they have put into starting and building their company. It is also a reality that control can be completely lost if consideration for decision-making power and balanced representation for voting are not taken into account. Ultimately, it comes back to the lessons at the beginning of the book about consciously choosing between wealth and control.

Week 6: Hiring, Recruiting, and Retaining

The decisions of who to hire, from what pool, and when are more tricky than they appear. Unfortunately, there is no “magic formula” for which strategy works best when approaching these decisions, so Wasserman’s Founder’s Dilemmas  offer some useful considerations.

Hiring friends and family can be great…or terrible. The fact that you know and trust these folks is great and your comfort level will likely be very high working with them. Mixing business and personal can make communicating bad news more difficult on both sides. It is also possible that you could be blind to mistakes or lower productivity that would have been much more obvious if it were someone else.

Bplans’ Scott Huntington suggested the following in his article 5 Things to Consider when Hiring Friends and Family.

  1. Is he or she qualified for the job?
  2. Did you hire the person for the right reasons?
  3. Will they disrupt your place of business?
  4. Is the person trustworthy?
  5. Will you be able to handle firing them?

Wasserman and Huntington agree that if someone isn’t qualified or capable of doing the job, then hiring them is a bad idea no matter how much you believe in them (or how badly you know they need the job). Your first responsibility is to ensure that your business is positioned for success, so avoid spending money on people that aren’t going to add enough value to advance the company towards its goals. It will only hurt the relationship further if you have to let them later on.

That said, you may have extremely qualified people in your network or the networks of your leadership team. If you’ve had the opportunity to work with someone and know they are a rock star at what they do and great fit for the culture of the company, it seems silly to hire a stranger from an ad. As you cast a wider net using search firms and job postings, it will get increasingly hard to ensure that the people you hire are great fits.

Herrenkohl’s How to Hire A-Players gives some practical advice for thoughtfully retaining your best employees. These include:

  1. Invest time with your A-players first. These A-players are the solutions to current and future challenges.
    1. Ensure role clarity.
    2. Give plenty of responsibility.
    3. Schedule regular meetings.
  2. Provide your B-players with coaching and accountability.Often, with a little effort, they can move to the A team.
  3. Turn some borderline performers into A-players by scaling down their roles.Recognize when focusing their efforts in areas they have strengths will help them move to the A team.
  4. Replace C-players and below with people from your farm team. After you’ve tried to lead and coach them and you haven’t seen them make the necessary progress, have the courage to move on to give someone else a chance.

The bottom line of this advice is that it is tempting to spend a lot of time on the low performers, but this sometimes is at the expense of your best. Some believe that if they are performing well they need less time, but this is a dangerous assumption. In reality, they need a very different kind of time from you: recognizing, encouraging, thanking, challenging, and exchanging ideas. They should see opportunity to continue to grow and recognize that a runway toward advancement exists in your company. Know what their goals are, how their current role fits, and have a plan to help them get there.

Week 5: We All Have a Role to Play

As we discussed in week 4, building a team is one of the more critical responsibilities of the founder. This week, we explore some of the challenges associated with matching the right people with the right roles. The Founder’s Dilemmas (Wasserman) points out some of the critical decisions that founders must address when deciding on executive roles. Of particular importance is the selection of the founding CEO, which is the focus of Part 1. Then, in Part 2, we will explore finding hidden talent and hiring for attitude and training for skill.

Part 1: The Role of CEO

The CEO is the top of the pyramid, meaning that final decision-making authority rests on his or her shoulders. As one of the founders, you should have an honest conversation with yourself if this is something you really want be to be responsible for (and if you can see your great idea through without that power). Some founders are great with ideas and specific technical or functional expertise required to bring a new idea to market, but don’t want the responsibility of making the tough calls when there’s disagreement among the c-suite executives.

The first CEO must be visionary in chief, working with the other founders to hone the direction of the company. This requires that he or she be what Wasserman refers to as an “idea person”, which his research shows is more likely of the CEO and usually corresponds to higher stakes in the company.

Part of that visionary role is demonstrating outstanding communication skills. He or she must communicate the vision to new hires, investors, and the public in a way that wins hearts, minds and dollars. Each of the people added to the team after the founders must understand what the bigger purpose of the organization is and how their role contributes. They must want to give their all for it, so a great communicator will help maximize their contribution. The first CEO will play a critical role in telling the story of the company to new investors, so the ability to connect with them and encourage their participation will be particularly important early on in the life of the organization.

In his Forbes article “How to Become a CEO” Christian Stadler mentions listening skills among those communication skills most important to achieve and succeed at the top job. It helps when you are responsible for the final decision if you are able to fully leverage the knowledge and experience of those around you.

Beyond these skills, the founding CEO must also be someone who has great passion for the company and its future. He or she will likely be making many personal sacrifices initially for the good of the company, so entering the job fully committed is essential. Often the first sacrifice is a willingness to give the company his or her full attention and leave the security of a full-time job to focus on the business full-time. This level of risk must be fueled by a confidence that the investment will pay off.

The top job isn’t for every founder. Choosing the right member of the founding team to assume the top job can go a long way to ensuring the long-term success of the company. Think hard as you consider the job for yourself…it is a demanding role that will call upon your skills as visionary, decision-maker and communicator for the company to succeed.

Part 2: Hire for Attitude and Train for Skill

Bill Taylor’s Harvard Business Review article “Hire for Attitude, Train for Skill” points out that hiring people with the right attitude can help differentiate your company among competitors. The assumption that hiring someone that already knows how to do a job is better than hiring someone you need to train on the surface looks like a no brainer. When you look closer, you might realize that with experience comes bias regarding “the right way” to do things. The industry standard approach may be the opposite of what your startup is going for when seeking to reinvent the experience a customer can expect.

Hiring for attitude also creates an opportunity to identify diamonds in the rough in the hidden talent pool. Herrenkohl’s How to Hire A Players suggests looking for those looking to reenter the workforce, those looking to exit corporate environments seeking more flexibility, and great people in service roles or jobs that are demanding and undercompensated who would be eager to find a place that values their hard work and great attitude.

If you are willing to think outside of the box when making your next hire, you might consider hiring someone with the right attitude and teach them what they need to succeed. This helps maximize work ethic and fit with the organization, and minimizes the challenges associated with approaching a job in the same boring way it has always been done when creating something new and different.

Week 4: Building Teams

Building a solid and productive team is one of the most critical roles of a startup’s founder. Wasserman’s The Founder’s Dilemmas points out some of the benefits and risks associated with assembling a team that is very homogeneous versus one that is more diverse. Here is a quick summary of many of those points:

Homogeneous  Teams

  • Short-term benefits include ease of finding people, speed of decision making, quicker to develop productive working relationships, easier construction of shared organizational identity, and less risk of conflict.
  • Longer-term risks include overlapping human capital resulting in overlapping strengths and gaps in expertise. There is potential for a shortage of creativity, greater difficulty in times of turbulence, stunted growth when friendship supersedes the best interest of the business, and a narrower network for identifying investors and employees.

Diversity and Counterbalance

Even more important might be the likelihood that homogeneous teams tend to have similar tolerance for risk and share similar values. This can make for a more stable partnership, but could also mean that there is no counterbalance if the team is too risky or too risk adverse. They may share priorities and preferences, but might struggle to counterbalance each other when their shared preferences are not in the best interest of the long-term success of the company.

Hiring a Great Team: A Competitive Advantage

Harrenkohl’s How to Hire A-Players  points out that having an incredible team of high performers can be a significant competitive advantage to the organization. He points out that your business should have the leadership to continue on without you, so it is essential to have the right people in place and to give them the autonomy and authority to do great work. This requires, as we have discussed in previous posts, that the founder must be willing to give up decision-making control and resist the urge to micromanage.

Hiring great people attracts other great talent and creates a virtuous cycle of success. Not only are current people more likely to be retained when they are surrounded by excellence, but they are likely to continue to be engaged and perform at the highest level themselves. This positions everyone for the opportunity to advance their careers as the company grows and thrives.

Selfishly, as the founder it is in your best interest to hire great people even though it means yielding some of your control. Doing so will allow you to have more balance in your own life, as the company’s growth becomes a shared goal and not one that you alone must realize.

 

Week 3: Building Social and Financial Capital

One of the great benefits of living and working in one town for most of your adult life is that you have the opportunity to develop a strong social network. I do feel confident in this area, as I have worked hard to develop a reputation where people trust me and my work. I have had the opportunity through several volunteer experiences to make connections with people with significant fundraising and nonprofit experience, so I feel like I have a deep well of expertise that I can call upon. I’ve also worked closely with many business leaders in my roles with local universities, so the range of consultants (and potential volunteers) I can call upon is pretty wide.

One area I have not spent a lot of time yet is developing my network in the human services community currently working on the hunger needs of my city. I’ll definitely need their support and guidance, both to minimize the duplication of efforts and to maximize the impact of the work. It would also be important to ensure that those doing the work now don’t have any impression that I’m looking to compete or “steal business” from them. There is plenty of unmet need and never enough resources. My hope is that the food truck will be seen as additive and a partner in this work.

In terms of financial capital, I’m fortunate that I have a runway before this business can launch since I’m waiting for my father to retire. This time represents my window to get organized and save/raise the necessary funds to start operations. Initial startup expenses are mostly centralized in the truck itself. The goal is to purchase it with cash, to ensure expenses are very low. Since dad will be retired, labor costs are flexible. I do want him to be paid, but he insists that while things get going this is not important. Eventually, he’ll also need the help of a sous chef to minimize the burden of preparation. This will be a great learning opportunity for a culinary student completing a required internship for their degree program. Volunteers can also be helpful with this kind of work.

My intent is not for this to be a full-time endeavor for me or my dad, so the decision whether to leave full-time employment is not the same as it is for many new entrepreneurs. If the response to the food truck is good, it would be more likely that we’d have to hire a second chef before we’d need a large, full-time administrative team. If the idea took off, and we were able to launch in multiple cities that would be a very different kind of organization that would require a lot more attention. This is probably the scale that would be required for me to leave my full-time job to focus on the organization as my primary work.