Posts Tagged ‘entrepreneurs’
Getting Legal Guidance Should Always Be This Easy and Affordable
Friday, July 15th, 2011
Startups and small businesses are often incredibly hesitant to call a lawyer for advice. Why? Because they want to avoid legal issues? No. Because they want to avoid the invoice afterwards.
Navigating legal issues is a challenge — a time-consuming and costly component of launching a business. Small businesses need legal guidance from many angles: corporate law, securities law, employment law, patents, trademarks, privacy, finance, litigation, tax… and the list goes on.
Interpreting and applying the law often deals with “shades of gray” more than “black and white”. In other words, a handful of very smart attorneys may offer very different perspectives and legal advice on a given issue.
So, wouldn’t it be incredible if an entrepreneur or small business owner could throw out a legal question to 10 attorneys who have a relevant background and receive responses from each – all for just a few bucks?
The founders of LawPivot thought so, and ActSeed agrees.
LawPivot is one of those “no-brainer” services for a startup or small business budget. Being able to tap legal knowledge like this is invaluable. ActSeed is more than a strategic ally of LawPivot; it’s also a happy client. Consider this a very warm referral for all ActSeed members.
If you’d like to try LawPivot, they will give you a free trial.
If you become a member of the ActSeed community (register for ActSeed here to receive the LawPivot bonus code; it’s free!), ActSeed will give a Promotional Code to extend your free LawPivot service through the end of 2011.
Not all of a company’s legal needs can be boiled down to a crowd-sourced response. Attorneys and legal work will still need to be in the budget, but having access to a breadth of legal minds for a small monthly fee is invaluable. To receive this service for free during 2011 is, literally, priceless.
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Finding Angel Halos within Higher Education
Thursday, July 14th, 2011How University-Affiliated Angel Groups are Helping Fuel Startups While Supporting Higher Education.
Angel investors typically congregate into formal angel groups based upon geographic proximity and interests in certain industry sectors and/or specific growth stages. While these characteristics generally reflect the commonality within the Baylor Angel Network (BAN), what makes this angel group unique is how they have integrated Baylor University into their operation.
Operating an angel group within a university setting drives benefits to a broader group of beneficiaries, from business students to the business schools they attend.
In addition to the standard angel-entrepreneur activity, Baylor’s Hankamer School of Business receives an angel-designated percentage of the profits from each successful investment in the form of a gift to the University – on average, 25% of the profits generated by the donor from a successful exit. Also, a few students at Baylor are selected to serve as research analysts who contribute to the evaluation of prospective deals. Baylor Angels also mentor the student analysts and share their wisdom with students taking entrepreneurship classes. BAN doesn’t require its angel members to be alumni of Baylor, but they do expect each BAN angel to contribute some of their returns to the University.
ActSeed is grateful to have the Baylor Angel Network involved in the ActSeed Investor Group.
The disciplined, methodical approach that BAN applies to their investment decisions meshes well with ActSeed’s own methodical process for helping investors quickly understand “what’s under the hood”. While BAN does very well in analyzing their deal flow internally, ActSeed Company (Entrepreneur) Scores provide BAN angels with another indication of how well a startup will perform in the due diligence phase. In other words, ActSeed can help entrepreneurs quickly “bubble up” to the surface with angels and reduce the time it takes to go from first contact to funding decision.
Kevin Castello, Executive Director of the Baylor Angel Network, shares his thoughts:
“Excellence is revealed in execution. A lot of emphasis is placed on the vision, the business plan, the team, and other components but without execution they are just words on a page. There are so many challenges for a new entrepreneurial venture and it is critical to have an honest evaluation of your business. I love that ActSeed is committed to help entrepreneurs be prepared for their venture and to provide them tools for that process. BAN looks forward to a continued partnership with the ActSeed community.”
Before approaching the Baylor Angel Network or any angel group, an entrepreneur must first explore whether investors would even be interested in their venture. ActSeed’s Investor profile helps clarify this. For example, an entrepreneur can review the Baylor Angel Network’s ActSeed profile to learn:
- What types of deals generally interest the 40+ angel investors who are members of BAN,
- Where BAN angels are looking to invest (across five southwestern states), and
- How much they intend to invest (amounts usually between $100,000 and $300,000, including participation in larger deals up to $2 million when there’s a lead investor already established).
For entrepreneurs who may be thinking about approaching the Baylor Angel Network, consider approaching them through ActSeed’s Entrepreneur Group where you can do more than pitch them an idea – you can demonstrate your “investor-readiness” through your ActSeed Scores and possibly get moved to the front of the line for consideration.
To learn more about the Baylor Angel Network and how they are integrating angel investing within the University, you can download their introductory document here.
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Impact Your Business
Saturday, June 11th, 2011Many entrepreneurs are “allergic to the numbers side of the business”. Part of the high failure rate of small businesses is due to avoiding and ignoring basic financial principals.
Ken Kaufman’s book explains the essentials of small business finance and how to easily apply them through the use of allegory. In other words, he uses “good ol’ fashioned story-telling” to make even the most finance-phobic business owner learn and appreciate the need for quantitative, financial management.
This is not just a story about Steve, a man struggling as a small business owner, a husband and a dad. It is a guide penned in a way we can all identify with. It goes beyond merely being clever about teaching financials.
For example, in Chapter 23, the protagonist (Steve) starts to see, from his own experiences, how anxiety and clarity are negatively correlated. This is a non-financial lesson we all must learn and respect. This book is full of well-articulated insights that we all face as business owners.
The first time you read it, Kaufman’s book is an enjoyable story that “hits home”. Then, it becomes a very useful reference guide for the next hundred times you’ll take it off your bookshelf.
You can get your copy of “Impact Your Business” here.
Kick the Tires: A Continuing Series for a New Generation of Small Business Investors
Monday, May 23rd, 2011ActSeed’s mission of reducing small business failure rates depend upon both well-prepared entrepreneurs and well-informed investors. This new series of articles, called “Kick the Tires”, will help both investors and entrepreneurs align for the best chances to achieve reciprocal success.
["Kicking the Tires" - an idiom - giving something an initial inspection before making a decision to pursue a transaction - origin: early car buyers would kick a vehicle's tires to see if they properly held air]
So far, we have been more visible on the entrepreneur-preparation side of the equation. Recently, we have started to make significant inroads on the other side of the same equation - sharing “best practices” with a new generation of small business investors and attracting seasoned investors with our methodologies that will help them accelerate the review process (“due diligence”) for making investment decisions.
“Kick the Tires” is a new series of articles that highlight the many issues that a small business investor or “startup angel” should address before making an investment decision. We’ll include red flags to watch for. We’ll review “tangibles” and “intangibles” alike. We’ll explore small business investing from almost every angle, including legal, financial, organizational, strategic and cultural.
To date, our primary efforts toward building new reservoirs of investor capital have been through our workshops and webinars (“How to Evaluate Prospective Deals Like a Professional Angel Investor“). These workshops are well-attended, but it feels like we try to cram two months of information into a two hour presentation. Seriously, we do share a lot of information in a short period of time. From there, we develop a relationship and rapport with the attendees to assure they have tools to find and evaluate small business investment opportunities within the ActSeed entrepreneur community and beyond. Kick the Tires is meant to supplement, expand and reinforce the knowledge shared in our workshops.
Who will benefit from reading the articles in this series?
Small business investors - both novice and seasoned. Whether you want to invest $5,000 or $5 million, you still should apply a defined due diligence methodology and process to assure your interests are aligned with your investment choice.
Entrepreneurs. These articles don’t contain fabricated hurdles or secret handshakes, but they do outline the issues that together create a solid business foundation that will give the business the greatest resistance to failure, which is another way to say the greatest chances for success. Investors don’t want to invest in a company destined for failure any more than the entrepreneur wants to build a business exposed to avoidable failure. In other words, what’s good for the investor is also good for the entrepreneur, making this series equally relevant to those building businesses.
Beyond the articles in this series, what can be done to help connect “well-prepared entrepreneurs” with “well-informed investors”?
Join ActSeed. Apply the knowledge that is shared in the articles by joining the ActSeed Entrepreneur Group or the ActSeed Investor Group. The principles and issues we highlight in “Kick the Tires” are the same that we use to connect compatible ‘treps and investors within ActSeed.com using our scored profiles and filtered search tools.
Finally, please send us suggestions or questions about small business investing that you’d like us to cover. We’ll do our best to address these issues here as well. Please send your questions about small business investing to: groupadmin.investor@actseed.com.
Together, let’s get to work and build some wealth!
Positive Impact 365: Big Brands Helping Small Business
Thursday, May 19th, 2011ActSeed has developed a program to help large enterprises and governmental agencies foster entrepreneurship and build early relationships with today’s emerging small businesses and tomorrow’s most promising startups.
There is a natural symbiosis between large enterprises and an “Innovation Economy” full of startups and emerging businesses.
Tomorrow’s market leaders are hard at work today, building companies that will grow our economy by generating taxable profits, creating jobs and contributing to free enterprise. Today’s “big brands” want to engage those young companies that are taking steps to build a solid business foundation for a long life. The same big brands want to avoid companies that show signs of being “here today but gone tomorrow”.
While some of today’s small businesses will grow up to be big brands and dominant market leaders, most successful small businesses will become customers and partners of large enterprises. In addition to selling products and services to small biz, big corporations constantly look for innovation within small companies to find new products, processes and technologies to invest in, license or even acquire.
With over 50% of all new businesses not even lasting five years, it is important for large enterprises to invest time and money with the companies that are avoiding the behaviors that often lead to failure, including a lack of planning, inadequate preparation and the failure to establish sound business fundamentals from the very beginning.
State and local economic development agencies are also very interested in attracting and nurturing small businesses that have potential to grow, create jobs and contribute to the local economy.
Governmental agencies are not usually interested or able to compete in the “home run ball” game that venture capital firms play with its portfolio of young companies, where one big ”hit” (company) might generate enough returns to account for the remainder of the investment portfolio to be written off or sold at breakeven at best. Economic development agencies don’t manage investment portfolios that must generate returns in a finite amount of time; rather, they want to nurture companies that will contribute to the local economy over generations, even if they don’t “get big fast”.
In summary, large enterprises and governmental agencies can use ActSeed’s “Positive Impact 365™” program to identify and nurture the most promising small businesses in specific industries and at specific growth stages.
If you want to learn more about how you can get your brand or agency involved in the Positive Impact 365 program, please send us an email to positiveimpact365@actseed.com.
Where to Go to Test and Improve Your Elevator Pitch
Tuesday, May 10th, 2011Inside Pitch for Entrepreneurs and Angels:
Crowd-Based Feedback for Startup Elevator Pitches
Our new LinkedIn group is a collaborative area for “perfecting the quick pitch”.
You typically get 45 seconds or 45 words – your “inside pitch” – to articulate your business model to customers, angels, VC and other investors. Join ActSeed’s LinkedIn group to test your message on fellow group members for constructive feedback, and help other entrepreneurs scrub their pitch, too.
How to participate:
Join ActSeed’s LinkedIn Group called “Inside Pitch” – it’s free!
Post your “inside pitch” as a new LinkedIn discussion in this group.
Invite others to provide constructive feedback.
Use the comment thread to refine the pitch and interact with those who are helping you.
Who should participate:
Entrepreneurs, small business owners, angels, investors, venture capitalists, founders of startups, students, executives, business coaches. Essentially, anybody who needs help or wants help in perfecting elevator pitches.
What happens when your pitch is ready?
Go find customers and/or investors and share your message!
Of course, ActSeed.com is a good venue to find “well-informed investors” who want to engage “well-prepared entrepreneurs”.
RULES:
1. Keep it constructive and civil. Rude or arrogant comments are not welcomed. We want to cultivate a forum where we help each other improve what we say or write when we pitch our business so when we do it “live” in front of a customer or investor , it resonates.
2. This is not a forum for you present your entire business plan or executive summary. This is where you try to say “more with less”. Here, we want to refine how we open the discussion so our targeted audience asks us to share more. This forum is for each of us to metaphorically “sharpen the hook that we’ll use to catch our fish”.
3. This is NOT a venue to solicit for funding. Please do not indiscriminately broadcast a need for funding. If an investor likes your pitch or your concept, they will likely contact you. Please keep the focus on perfecting the message. We will aggressively moderate against misuse of this group.
Inside Pitch is sponsored and managed by ActSeed, an online community for startups and small businesses – a community dedicated to providing the best resources to help entrepreneurs properly plan, establish a solid operational foundation, attract investment and become highly competitive in the marketplace.
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Accessing the World from Your Own Back Yard
Monday, May 9th, 2011It’s not uncommon that a startup in the USA has an almost immediate international presence, and it’s also not uncommon that entrepreneurs from other countries are trying to access US markets.
While we often talk about how the Internet shrinks borders and facilitates commerce, sometimes a “good ole fashioned” cross-border support group works well, too.
One good example of cross-border collaboration that is helping entrepreneurs and startup businesses in two countries is the Swedish-American Chamber of Commerce (“SACC”), and ActSeed is proud to be a partner with the San Diego chapter. Founded in 1988, SACC-USA is the umbrella organization for 19 regional Swedish-American Chambers of Commerce across the United States. The SACC serves more than 2,300 members in Sweden and the US. 
The mission of the SACC is to facilitate and support trade, commerce, and investment between the US and Sweden – helping Swedish companies find the right partners in the USA and vice versa. This is achieved through effective industry specific programs and events, corporate programs, trade missions, business matchmaking and lots of ”good old fashioned” networking.
The SACC San Diego was founded in 1989 as one of the first local Swedish chambers in America. The Swedish American Chamber of Commerce in San Diego is a non-profit organization with the goal to promote, develop, and increase the Swedish–American contacts and interactions in the greater San Diego area.
More and more, the San Diego SACC is becoming involved in the local San Diego startup scene. Entrepreneurs from both countries are starting to collaborate on projects and help each other tap new markets and find investors. Through the international partnership between the SACC and ActSeed, we can help make sure entrepreneurs, investors and work-seekers in the US are aware of the opportunities emanating from and within Sweden while also helping entrepreneurs and investors in Sweden learn how to leverage ActSeed to participate in business creation and growth in the US.
You can learn more about the San Diego Swedish American Chamber of Commerce by clicking here.
Also, if you are involved with the San Diego SACC and are interested in joining ActSeed’s “Entrepreneur Group“, you can use discount code “SDSACC12″ to receive a 10% discount on either a monthly or annual membership.
If you are an investor from Sweden and want to find startups or small businesses in the US in which to invest, please join ActSeed’s “Investor Group” and start tracking deals; it takes about 15 minutes to get set up and costs nothing for the investor.
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Compatibility Counts
Tuesday, May 3rd, 2011What is compatibility in the context of small business investing and why is it important?
Private direct investment is very different than buying a publicly traded security. Investors do not have the same regulatory support or liquidity as a publicly traded stock. While we have witnessed a number of publicly traded companies mislead the public with incorrect or incomplete information in the past, at least there is a formal structure with a set of reporting regulations and consequences for failing to adhere to those regs and provide certain information to investors. With startups and small businesses, there is much less information available and very little regulation on what must be shared with investors.
Because of this, there is a greater element of compatibility required between the small business investor and the small business.
Trust and Alignment of Purpose
Understanding this need for compatibility is one of the key topics in the ActSeed Investor Workshop (“How to Evaluate Deals Like a Professional Angel Investor”). Simply stated, we strongly recommend that seed stage investors and startup entrepreneurs are fully aligned in purpose and culture as well as around expected return on investment and “exit strategies”. At the early stages of a business, investors should be viewed as a partner, not as a transaction – a co-pilot and navigation assistance, not merely gas in the tank. The business risk is extremely high in the early stages of a new company and the investor should play an active role in helping the entrepreneur steer clear of pitfalls.
Last year, we created a fun vignette about how ActSeed was like an “eHarmony for startups and investors” – how we help match investor-entrepreneur compatibilities. Recently, we had an inquiry from an entrepreneur who didn’t quite understand our analogy, and interestingly, was persistent in trying to understand how we were an “eHarmony to investors”. So, we drafted a candid reply:
“Simply put, most early/seed stage investors look for strategic and long term compatibility, not “quick hits”. The days of throwing money into something based upon a whim or basic concept are gone.
eHarmony markets their community as one where “people are brought together based on the things that really matter” (the current front page quote on eHarmony.com). ActSeed does the same for investors and entrepreneurs.
To further apply the personal relationship / eHarmony metaphor: investors aren’t interested in “one night stands” and “casual encounters.” Investors are no longer being seduced by what sounds good without verifying what IS good. ActSeed provides a mechanism to help the investor verify and accelerate the due diligence process by 60-90 days.
The common theme from our growing Investor Group members is that they don’t have time to see millions of interesting ideas, but they want to quickly find a few good ones that match their interests AND that provide evidence of preparedness in the core areas of business …PLUS a demonstrated ability to execute a sound plan.”
We know ActSeed isn’t for every entrepreneur, but we pledge to our growing group of Investors that the companies and entrepreneurs they will find within ActSeed’s Entrepreneur Group are ready to “extend trust” through an early presentation of the due diligence issues that will eventually need to be addressed anyway. The sooner this information is “on the table”, the faster a deal can be done or the parties can move on. If you can use the ActSeed process to cut 60-90 days out of the due diligence process, why not?
Within ActSeed, in order for a successful investment to occur:
- ActSeed presents the questions to be answered
- The Entrepreneur must provide the answers
- The Investor must trust the answers
Are you an ActSeed Investor?
If you are someone who wants to invest an amount between $5,000 and $5 million in early stage, seed stage, startup or small businesses, please join ActSeed’s Investor Group. It’s free to join, takes 15 minutes to set up, and allows you to interact on a username basis and allows you to reveal your real identity when and if you choose (to avoid the possibility of “overly ambitious” entrepreneurs).
Learn more about ActSeed’s Investor Group through the resources below:
Click here to download a 1-page PDF about ActSeed’s Investor Group
Watch a two-minute video about ActSeed’s Investor Group:
Join ActSeed (no cost).
Then join ActSeed’s Investor Group.
Let us know how we can help you get set up.
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Make the First Pitch Count
Friday, April 22nd, 2011Thoughts for your first pitch:
Relax and enjoy the experience.
Let your passion come through, but keep it simple and concise, and don’t get defensive if you “cross nerves” with your audience.
Make sure you can quickly and clearly explain: what customer “pain” you’re solving, why your solution will sell, how you make money (and when), and how your investor can expect to realize their return on investment.
It’s ok to not have answers for everything. If you don’t have an answer, offer that you will get back to them with the answer. You might even acknowledge that their question is a good one and ask them if they have any insights to share toward converging on an answer.
Things we suggest not saying:
- “We have no competition.”
- “Our revenue projections are conservative.”
1. Investors may only listen when you tell them about a good idea.
however…
2. Investors may “open their checkbook” if you (A) have a good idea and (B) can demonstrate that you have a plan to implement that good idea and turn it into a profitable one.
We champion all of this and more within our ActSeed.com community.
This note was originally a reply to a young entrepreneur on LinkedIn who was about to make his first investor pitch and was looking for advice about pitching.
In addition to our quick response to “making the first pitch count”, we also recommend buying the book, “Pitching Hacks“.
Now, go out there and make every pitch count!
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Plus Factory: The Difference Between Doers and Dreamers
Monday, April 4th, 2011“The difference in this world between the doers and dreamers is execution.”
– Warren Park, President of Plus Factory
Just before one of our country’s greatest economic meltdowns occurred, two seasoned industry professionals, Warren Park and Simon Tsai, launched their own digital agency. Park and Tsai are creative managers who have spent years in the world’s leading media, advertising and marketing companies. Plus Factory survived and is becoming a global digital development and production powerhouse with offices in New York City, China, and Vietnam. 
We spent a few minutes with the founders to learn their story, get their perspective on entrepreneurship and learn what it takes to start and build a business.
Q. Describe your “Eureka Moment”. What was the market opportunity that drove your decision to form a company around this product/service?
A. When working at another agency, we were working on a budget internally to send to the client and even I thought it was super expensive for what the client wanted. I worked with the project managers for days to cut down the budget. We ended up showing the client the budget and they just laughed at us, saying it was too much. We knew we could do it as well and for less.
Q. How did you fund the company to its current state?
A. Bootstrapping. My partner and I both put in $2,000 from our savings and got the company up and running. We were lucky. We landed some work right away, so we started to generate revenue from the get-go.
Q. ActSeed champions the need for solid planning and preparation from the very beginning. How important is planning and prep to your company’s success? Can you share an example or two?
A. Very important to plan and prepare. 1 is to be very realistic. 2 is to be very prudent on your finances. You need to know what you are going to spend and what you are going to bring in. We did a lot of forecasting of new business and what we were spending.
Q. How long did it take to get your idea into the market from initial concept to first customer?
A. 1 month. We literally got incorporated and started getting business and clients. We were lucky.
Q. What influence have the internet and new media had on the way you are marketing, selling and supporting your services?
A. Well our business would not exist without the internet. That’s multi-layered. Our core service/products are for brands/advertisers going on the internet, so that’s one thing. The other thing was we were able to use many tools that only existed on the web. All communication tools are now web based including voice (Skype), office tools (Google Docs) and accounting (bill.com). Basically our whole infrastructure is on the web.
Q. Describe the challenges you faced as you built your customer base, including defining the customer target, establishing the right price and pricing strategy and of course, closing the first few deals.
A. You need to play with your business model and pricing on a consistent basis till you hit the right ‘combination’. It’s an organic process and if you believe you have the right pricing/target market/model out of the gate is a big assumption.
Q. What techniques have you used to establish credibility in the eyes of customers, investors, partners, personnel and the general public?
A. It’s all about visual appearance. Every communication touch point you provide to your client represents you – good or bad. So first off, your website needs to look good (it’s a good thing we build websites for a living). Second is your phone line and your office environment. I don’t think its bad per say to have a home office, but if you’re on a client call and the dog or kids are in the background, it gives an unprofessional vibe to your clients. And then it’s you as a person. You are a brand, an avatar. You always want to control how your clients will perceive you on any given interaction (i.e. on the phone, in person at a meeting, etc)
Q. What is the most important thing people never tell you about joining or founding an early-stage company?
A. There is no stopping once you get going. It’s our fifth year of operations in 2011, and we feel we are on a train. Once you get your own business going, there is no stopping or brakes. That’s the difference between your own business and working for a business.
Q. Is there anything else you’d like to share that we didn’t already ask you?
A. Just try to fund it yourself and don’t count on outside money. If you are lucky and really hit your target, you can generate sales right away to get your company going. People who have an idea and just want to get funding for it without any leg-work or creation done is following “fool’s gold”. The difference in this world between the doers and dreamers is execution. Everyone can come up with an idea, but the question is, can you execute and make it come to a reality.
Learn more about Plus Factory at www.plusfactory.com.
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