Why scoreboards matter

Humans are compelled to count. We count everything. Days, weeks, months, years, birthdays, money in the bank, salary levels, years of experience. It’s part of the human condition, maybe it helped us evolve to a civilised existence .

As startup entrepreneurs we need to let our people count something. Whether it’s the savings they made or they friends they have, there needs to be a way for them to keep track. So our people know they have made progress. Commerce is an anthropological game of football. So we must keep score. But it must go beyond the corporate scoreboard of profit, share price, turnover, number of employees… it has to be an audience focused score. Like followers on twitter. It has to be about them, not us, it’s how humans roll.

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When to quit

This is the fifth of my crowd sourced blog entry ideas as suggested by Cameron Reilly. Cam wanted to get my thoughts on the following: When to call it a day. When to close up shop.

This is one of the most difficult propositions as an entrepreneur – when to stick and when to quit? My view is a simple analogy. When the startup or business feels like a bad romantic relationship you’ve had. The type of relationship you knew you had to get out of, but couldn’t. The type of relationship you had an unhealthy addition to, or found it too hard to leave emotionally, or was scared of the financial losses and asset split associated with leaving it. When your business feels like that, it’s time to leave. If you view your business as a relationship you have with it, then it will become clear if it’s over. Because we all know that feeling. And we usually know the truth deep down in our hearts when things are just not right.  When your startup feels like that, it’s time to shut up shop.

Here’s some simple sentences that may also help you know if it’s time to quit:

It’s time to quit when, you’ve lost interest in the project, and your only doing it for the money.

It’s time to quit when, you only keep going because of the time and money you’ve already invested.

It’s time to quit when, you can’t sustain yourself or family on the income it provides, or the little time it leaves.

it’s time to quit when, you’ve had enough and would have a less stressful life in a job.

It’s time to quit when, you’ve run out of money, time or desire.

It’s time to quit when, you know who can achieve more moving onto the next project.

It’s time to quit when, your not quitting because the newness has worn off, but the business is genuinely not working.

it’s time to quit when, you achieved multiple set milestones set and they still didn’t pay off financially.

it’s time to quit when you no longer believe in what your doing.

It’s time to stay the course when none of the above applies.

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Borderless Venture Capital

This is the third of my crowd sourced blog entry ideas as suggested by Aida_Lee. Aida wanted to get my thoughts on the following: In today’s cheap, quick and global market, what do you see as the blueprint for a border-less venture capital to work?

There is no doubt Venture Capital has been a bit of closed shop historically. And although we’ve seen some opening up of business funding in the USA with vehicles such as the techcrunch 50 and Paul Graham’s Y Combinator, other markets such as Australia are lagging behind quite significantly. My views are the opinion of someone who has raised venture and angel funding before for new ventures.

In my view a thing things need to happen for the traditional structure of Venture Capital to change:

  1. A startup community must evolve in a tight geographic region – this often facilitates events such as those mentioned above in Silicon Valley.
  2. Disruptive technology must become available which breaks down traditional access barriers to outsiders.

Number 1 has happened in only a few locations, namely S Valley, but number 2 has happened all over the world and this is where I see the major changes. The thing that new internet technology has done is brought entrepreneurial communities together. Now we can find each other without having to live near each other. But the funny thing about raising funds for what is considered risky investments, is that it isn’t nearly as much about the idea or revenue potential. It’s about the ability to the team raising to sell themselves. And all real selling requires lots of face time. It’s hard to do this on line, or across borders. So I think that large capital raising wont change a great deal in the future. But, I do see an important  capital raising revolution coming:

Crowd funding.

It’s been done already in a few markets, and some entrepreneurs and start ups have already used this technique to raise money for their venture. The idea has been well documented, but a true revolution, such as social networking  has yet to happen. The main thing holding it back has been government regulation from the likes of the SEC and ASIC in Australia. What I think the next iteration will be, is a web based business which takes micro payments / investments (a little bit like Kiva) from a large number of punters (for lack of a better word) to fund the new business. Method of which would be like an on-line float for startups. The investors who then would become digital evangelists for the new company. There would be a synchronized  ‘investment beta’

The key service of such a site would be to overcome the legal vagaries for all participants and be able to take investments in multiple currencies from multiple markets. There is no doubt this would leverage the quickly building on line entrepreneurial communities. It would also have an important impact the venture capital industry structure the same way digital freelancing websites like elance have respectively.

I’d be interested if there are any sites already doing pure crowd sourcing, and to hear what your thoughts are.

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Startup Idea Generation

This is the second of my crowd sourced blog entry ideas as suggested by Aj Kulatunga. Aj wanted some basic suggestions on how to develop an idea to start a business.

First of all I start by saying, the idea is not nearly as important as people think it is. The problem with a new idea is that we need to go the effort of education people, building a new supply chain and inventing demand. Sometimes ‘selling potatoes’ is a better option. That said, I’ve been asked to give inspiration for idea generation – so here are the Sammartino methods.


The law of the opposite:

Equal and opposite version of existing successful products / markets / services.

Not from here:

Bringing stuff from elsewhere to this market and positioning it as such. Usually imported or licensed version.

The Nth:

The more intense version of something. More power, ingredients, recognition. The Nth degree. For example red Bull is really an Nth version of coca cola. More intense energy hit. Hummer is also an Nth 4 wheel drive / SUV.

Idea Borrowing:

Local versions of overseas success. Quickly adapting successful ideas for overseas markets. Although these days you have to be very quick. That said, it is easier to find them out via websites such as springwise.

The unexpected version:

Eg Extreme Sour Lollies

Selling Potatoes:

Nothing new, existing idea, existing industry, with large existing demand. But must have low barriers to entry. But do it better, try harder, with amazing customer service levels.

Gourmet / Natural version

Has happened a lot in the grocery / supermarket categories. Entrepreneurs have taken advantage in categories like Juice and yogurt.

Extraction method

Take a tiny part of a successful and existing business and just do a micro niche of it. Twitter is this for Facebook. Just taking the status update part.

Danger of trophy IdeasThis link

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Pro Bono marketing

This is the first of my crowd sourced blog entry ideas as suggested by Christopher Hewitt. Chris wanted to know whether providing services Pro Bono was a good idea for startups.

In a word Yes.

More important than the answer are the reasons. It says something about us as people or an organisation. It starts the brand personification process.

It says we give before we expect.

It says we have confidence in our knowledge and our skills.

It says we trust you not to take advantage of us.

It says we are prepared to a resource before we expect you to become one.

In all it creates an environment where reciprocity is likely. Reciprocity is part of the human condition. In addition, it’s the best way of providing a sample, when providing a small bottle of shampoo or a taste test isn’t possible.

Startup Blog says: Pro Bono is rad.

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Crowd sourced blog entry ideas

I was wondering what to write about on today’s blog entry so I sent the following tweet:

Help needed: Blog Challenge: Give me any topic on marketing or startups and I’ll write and entry on it in 30 mins. #ideasneeded

The response was bigger than I thought it would be with 4 ideas in 5 mins (ideas list is still growing). So I decided to write an entry for all the suggestions I have received. I’ve attached the response tweets below and my subsequent blog entries will be on these crowd (well twitter friend) suggestions. Which is cool, because I have to respond to the ideas, feelings of others and just start writing. This should be fun!

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