Tech Savvy and Lessons From the Stone Age

About 2.5 million years ago, some clever early human wrapped in a rabbit skin fashioned the world's first stone tool - probably using another piece of stone. A technology that led the way for mass migration and eventually other technological innovations leading up to satellites leaving our solar system. But those innovations were way down the line. If you were one of those early stone tool making types, you were pretty much set for about 2.4 million years. It was all mammoth meat and hot cave gals for you baby. That is until some jerk smelted copper with tin, arsenic and other metals to make - dare I say it - BRONZE!

I can just hear the complains at the Stoneworkers Union hall. "what's this new technology!?" "Can't possibly replace stone! I mean it was good enough for my dad and his dad and so on, then stone is good enough for me". And I'm sure there was a couple of blokes in the back of the room whispering, "What's bronze?" These fellows were faced with wrapping their heads around this new technology or face the very real possibility of have same heads lopped off, shrunk, and worn around necks of the heads that adopted the new technology. Those that did adapt, were pretty much set for about 2,600 years. 

Fast forward to 600 B.C. and all hell breaks loose again. Some wanker develops iron, a metal that could slice right through your shiny bronze swords. Earlier adopters donning iron helmets and wielding iron swords were suddenly everywhere building roads, taxing the hell out of everyone and teaching the world just how vitally important it was to adopt new technologies. 

I could go on, but I think you get the point - unless you're still wrapped in a rabbit skin loin cloth. Technological advances went from time frames measured in the millions of years to several hundred and now less than a life span - much less! For the average middle aged worker today, the concept of I learned a skill like the microsoft suite and now I'm technologically savvy is a sure way to get the modern day version of an iron axe in the head. Technological advances happen every 12 - 18 months. In fact, a generation is now viewed as 6 years! 14 years olds think 20 years old siblings are technological dinosaurs. 

And this appears to be coming at us two tiers, the gross general trends - we're in the interconnectivity phase that includes social media and collaborative operating models and on a micro-scale, the tools that operate in this phase like Facebook and the google suite of online tools. 

To call yourself tech savvy, one has to be constantly aware of what's being developed on the gross and micro scale, test it, adopt it or try something else new - and there will be plenty of that. It should be part of everyone's routine to scan, test and adopt. Otherwise, you'll find yourself and your business being trampled under-foot by hoards of new technology wielding early adopters. 

I Ain't Afraid of No Posts

https://en.wikipedia.org/wiki/Spirit#/
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I like to write as the mood or idea comes to me. So a lot of the sources I quote are somewhere in the pile behind my desk. Like google being the 18th search engine business. Can't recall where I got that one from, but point is, they didn;t let the first 17 failed attempts dissuade them from being number 18.

Likewise Amazon was absolutely railed against when they started selling things other than books. "They're BOOKSELLERS - Period!" was the chorus heard from every so-called business expert in the field.

I'm sure, if you're an entrepreneur, that you've heard more Debbie Downers than you care to count blow hard about the dangers of any course of action you could take and why you shouldn't go there. And they love posting all about it. What they're saying is "I'm a coward, How can you not be afraid like me?!"

What these folks do have in common is being too lazy to do their homework. A business strategy - long before spending a dime on the actual business - is critical. It can identify why the others have failed, why you're different, and the path you need to take to be successful. Google and Amazon relied on their unique product offering, their unique core competencies and a well-planned strategy that connected them with a well-researched customer need. This alignment is business strategy.

Unicorns and their Fearless Pursuit of Opportunity

If you're an entrepreneur you've probably noticed that most people don't think like you. Or more correctly stated, you don't think like most people. By example, when a new venture is proposed, most folks will see every reason imaginable why it can't work. The actually pride themselves on their ability to see the downside of anything as if this is some sort of entrepreneurial skill. Based on their vetting process they appear to be looking for the one venture where the path is clear, the risk is zero and the workload minimal. Or as I like to say, Unicorn hunting. And like unicorns, they don't exist.

https://commons.wikimedia.org/wiki/
File:DomenichinounicornPalFarnese.jpg{{PD-old-100}} – for works in the public domain 
because their copyright has expired in countries and areas 
copyrighting works for life plus 100 years or less.

The problem with most people, these pseudo-entrepreneurs in particular, is that they fear the hard work and risk required to build a business. True entrepreneurs look at what most people see as an obstacle as an opportunity. Some even thrive, seek out, and absolutely love onerous regulations as this tends to frighten off competition. Where one person thinks about how impossible it would be to mitigate the risk and comply with regulations of a toxic cleanup business, others see an opportunity to charge a surcharge and know the competitive field will be small increasing the margins even more.

Our team thrives on a challenge and our members have been chosen to tackle the varied challenges needed to thrive, the same challenges that scare off the average joe and pseudo-entrepreneur.  We're fastidious in understanding a product and its place in the competitive landscape and fearless in executing ones we've vetted. Missing pieces are just that, a piece to be secured and added to our tool belt.

So the next time you're in the latest quasi-governmental or non-profit "here's how to think outside the box" group or consulting with business guru of the day, listen for ques. Are they fearful? Are they quick to dismiss an idea because of competition, regulation or even workload? If so, recognize that they are looking for the mythical unicorn and overlooking an ACTUAL extremely rare and fearless unicorn, you.

Paying Artist What They're Worth

https://en.wikipedia.org/wiki/Sistine_Chapel#/
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We all know who painted the Sistine Chapel in Rome, Michelangelo, of course. But ask anyone if they recall the name of the architect who built the chapel itself? Now ask anyone, who should be paid more in a construction project, an architect, engineer, or an artist hired to decorate the finished structure. Precious few would even consider paying the artist anything close to what they'd pay an architect or engineer.

I lead a consulting team of alphas in Web Design, Business Strategy, Branding and Marketing Strategy, Videography, Accounting Strategy, and Legal Strategy. Together we market ourselves to entrepreneurs as "Your C-Level" team and we all share equally in the proceeds from our clients. Yes, equally, from logo design to contract negotiations to web design and even to additional artists added to the team as appropriate and needed for a project. And we do this because we feel every part of the development process is critical to building a successful business.

Let's face it, we design products for people not Vulcans. Your product should not only function well, but look great, feel right, be a pleasure to use, and just have. Together we build products that include artistic design throughout and not as a final layer, an add-on, or gloss. We value these team member contributions and pay accordingly.

The architect that built the Sistine Chapel, by the way, was Giovanni dei Dolci. And yes, we consider architects artists and just as important as engineers. The engineer? No idea.

Please send business proposals to george.j.constance@gmail.com.

Be a Viking Not a Berserker

https://en.wikipedia.org/wiki/Berserker#/
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History rarely treats them as such, but the Vikings were brilliant strategists. Their well-known and well-deserved reputation for brutishness was usually followed by some fine deal-making that allowed them to physically establish themselves in territories from the Byzantine Empire through North America and control trade throughout most of Europe. And part of that strategy was to establish a foothold using a segment of Viking society known as the Berserkers.

The Berserkers, from which the term "berserk" originates, were the shock troops of the Viking world. Historical texts describe them as savage beyond belief charging into battle in a frenzy wearing animal skins and no armour, biting on their shields, and displaying super-human strength. They are described further as immune to the pain of fire. So terrifying was their appearance and actions that the werewolf legend may have been based on these animal skin clad, beast-like Vikings. They were, in fact, probably drug-induced and so fearsome that they often turned on their fellow Viking communities or hosts, raping and killing at will. For this reason, Viking Lords often turned the sword on these Berserkers after battle to restore order to their newly-won territories and rationally negotiated lasting treaties with defeated foes and neighbors alike. The greatest Anglo-Saxon King Cnut was in fact a Dane and King of England, Denmark, Norway and a big chunk of Sweden. He didn't accomplish this gnawing on his shield.

As a business strategists, I seek out Vikings, aggressive, determined people who are passionate about their products. The Berserker know-it-alls with no time to think through their business processes and company direction are bound to end up on the wrong side of the sword. I don't have time for them.

GJC Business Strategy Consulting has teamed with other Vikings in Marketing and Branding, Web Development, Accounting and Finance, and Law professionals to provide C-level services unprecedented to entrepreneurs. We quickly plan strategies that provide not only a foothold in your market, but a plan for rapid and lasting growth through market exploitation and collaboration.

Long story short, be a Viking like Cnut and not some nameless berserker.

iamge credit: https://en.wikipedia.org/wiki/Berserker#/media/File:Bronspl%C3%A5t_pressbleck_%C3%B6land_vendeltid.jpg

Can you have a "Gentleman's Agreement" with a woman partner?

I'm fortunate to have quite a few partners in all of my business ventures who have trusted me enough to work for equity on a handshake alone. These "Gentleman's Agreements" are usually a result of getting to know someone, getting a good feeling right away, or a willingness to take a chance in the short-run to evaluate a relationship before signing on. I liken the last one to dating before marriage. And in each case the deal is struck between people who are attaching their very reputation to fulfilling their end of the agreement.

But, what if, as is the case for me, what if many of your partners are women? Is the agreement still referred to as a gentleman's agreement? I can see two women reaching an agreement as "Ladies" in a Ladies Agreement", fair enough. But what if one of the is a guy and the other a gal?

I reached out to my oldest daughter who works for the Democratic party. She was first shocked that Libertarian-leaning dad would consider this question and second at a loss for what gender-neutral word to substitute for Gentleman. In the end she suggested a "Professional Agreement". Good stop-gap in my mind, but to me, "professional" lacks the power of "gentleman".  The terms Gentleman and Lady, after all, refer not only to how someone conducts their business, easily separated from the whole person, but refers to the core, the essence of who that person is. Breaking a gentleman's agreement isn;t just indicating you;re a bad person to business with, but a bad person overall.

Problem is that the two terms exist as two gender specific roles were universally recognized at the time the term was coined. Proper adherence earned the term Lady or Gentleman and since Ladies rarely conducted business, Gentleman's agreement was  a no-brainer. And let's be honest, there are still roles apparent and equally enforced by either side of the gender formula with a few extra added in recent years. So, separate terms might still be useful in today's society.

As it stands now, I'm leaning towards "Gentleperson's Agreement". A gentleperson would seem to cover all the bases. It just lacks that age-old feeling of time-tested honor. Spell check appears to be just as torn as it shows "Gentleperson" a misspelling of "Gentle Person".  Or is it the duty of the current three generations of business people to propagate the term and an associated sense of honor-bound obligation.

And I read over this article I noted that I used "them" and "they" as opposed to awkward "he or She" as Gender Neutral terms. There must be a way around this. Please help by commenting.

Equity Crowdfunding - Anyone Can Get funding - Even Concepts

The SEC, Securities and Exchange Commission, quietly released a revision of the 1933 Securities Act that regulated how businesses raise funds through equity and how individuals can invest. I know the original Act itself sounds onerous to most of my fellow libertarian-minded colleagues, but this was really needed back in 1933 and the revisions are nothing less than amazing in 2015.

First, the 1933 Act put a whole lot of snake oil salesman out of business and protected a lot of simple folk from being bilked out of their life's savings. To start with, it required businesses to register with the commission to keep an eye on them. And it prevented them from using wide-scale advertising for investors. If you wanted to invest, you had to work through registered/accredited agents like accountants and professional investors. The investor also had to be accredited having a net worth that was deemed sufficient to protect you from ruin should the venture fail. I know this sounds like big brother protecting folks. But keep in mind, this was 1933, the height of the Great Depression and people were desperate.

Fast forward to 2012 and something amazing happened - crowdsourcing and crowdfunding. The SEC correctly recognized that the internet allowed vast access to capital for small businesses and that crowd could help vet businesses, adding a layer of protection for investors. And so, Jobs Act Title II was passed allowing businesses to cast a wide net on the internet to solicit investment for equity. The investors and businesses, however, were still required to be accredited. The intermediary like WeFunder.com, likewise and rightly, needed to be accredited by the SEC. And the SEC spent the next 2-3 years taking comments from players, monitoring progress, and developing something truly amazing, Jobs Act Title III.

Jobs Act Title III of the 1933 Securities Act, effective May 16, 2016, allows nearly anyone to invest in nearly any business through an online intermediary. This includes NON-accredited investors with minimal income and assets. There are some rules to follow such as registration requirements for all involved. But they don't represent a major hurdle and the onus is on the intermediary crowdfunding sites to maintain. In this Act, folks making less than $100,000 per year can invest the greater of $2,000 or 5 percent of the annual income or net worth and 10% of the annual income or net worth of an investor, if either the annual income or net worth of the investor is equal to or more than $100,000.

This is huge! Investment is no longer the advantage of a privileged a few and any great product or business can seek funding - even concepts. Those tired, dated, and arrogant Angels and VCs, most of whom know nothing about your product or industry, will now have to take a back seat to the general public.

By example, if you have a great concept but lack the funds to create a prototype, the crowd can invest. You don't need to spend time developing networks and risking exposure of a great idea to folks with deep pockets. Alternately, if the concept sucks, the crowd is sure to let you and every other potential investor know why.  As an investor you can invest as little as $100 in as many projects as you like. And you don't have a to have a bucket of cash and can spread the risk around by investing in several projects. You might even get a piece of the next Apple.

Of course there are requirements in the 772 pages of required reading including a well-designed business plan and strategy and review by accredited third parties. This is what we do. We align your product with the market and SEC requirements to increase your chances of being funded. One analysis can validate your product features, target market, identify cash needs in a format required by the SEC for equity crowdfunding.

What are you waiting on?

GJC Business Strategy Consulting
860-970-2645

How to Get Funding for a Startup

Product design, prototyping, customer segmentation, marketing strategy, marketing campaigns, manufacturing and distribution channel design, communications design, management strategy and design, and so much more. You may know your stuff when it comes to what you do as a small business owner, but no one can know all there is to know about all of these things. But these are the things that an investor wants to see.

My job as a business strategy, likewise, is not to know all of these things, but knowing they are needed and how to align them in the most cost effective and efficient way possible. This is what a business strategist does - align the business concept with the market and funding.

So I know what you're first reaction is; I can't afford all of those parts. This is where we provide the value you need. Most of our work involves preventing you from wasting money and, instead, investing money where it's needed. This is bootstrapping at any level. We're huge fans of bootstrapping and so are investors.

Check out our short article about BOOTSTRAPPING here.

My favorite examples of large scale bootstrapping involve a Soy Milk producer and the never too old story of how VHS beat Betamax to the market.

Looking at soy first, the milk industry actually sued the makers of a popular soy milk for using the word milk in the label and causing confusion with the customer. The suit was settled when the Milk industry agreed to distribute Soy Milk. This provided additional income for dairy distributors, allowed them to hedge their bets should soy replace milk, and gave Soy Milk folks a bonanza of not having to develop and maintain distribution and marketing channels.

Likewise, my personal project, Kronicity, a research tool that allows users to easily collect and associate data from any device, was faced with very large costs for content, marketing, and distribution in academia. My solution was to make it free for all educators along with revenue potential for teachers and professors. I saved a ton of cash and will launch months earlier than expected.

As for VHS, they faced a competitor in BetaMax that was backed by industry tech giant SONY that developed the Betamax nearly two years earlier. VHS countered with a product that allowed recording of movies 2 hours long (betamax bet on hour long television recording preferences for the consumer), and more significantly through an agreement with Blockbuster video to provide movies, marketing and distribution. The customer naturally gravitated to the machines that played all those Blockbuster movies. JVC used business strategy to collaborate the pants off of SONY.

In most cases, going it alone, spending the long dollar to reinvent the wheel, more accurately the distribution, marketing and manufacturing channels is a waste of precious time and money. You can get to market a lot quicker and for a lot less than what you thought through a good strategy that involves a few collaborators. Create and execute a plan like this and you're much more likely to launch with the cash you have and attract investors to grow to the next level.

For another example of really well spent money, consider our next post: "How Can I Reduce Development Costs".

How to Reduce Developer Costs"

I like to cite examples of what to do using my personal startup, Kronicity. Kronicity is a free research tool that generates revenue through user engagement and publishing. Greta idea, but getting it developed has been a pain in the ASCII. I literally went though 5 developers to get the product to a place where we can anticipate a launch. And I've come up with a few rules for development and a new tool in my business strategy tool box.

1. Never use equity as payment for a developer. They're just too few around and they're so easily pulled away by paying customers.

2. Vet the hell out of them. This doesn't mean looking at sites they've developed. You really have to get in there and talk to the owners of the site they've worked on and even the developer's partners. Sorry to say guys, but development seems to attract the real awkward kind of folks - folks no normal human can work with.

3. You can save a bundle gong offshore, but Don't go directly offshore. Use a third party in the USA that can be held responsible. More on that in  the example.

4. Talk it over with a lot of folks.

Here's how I accomplished all of these rules in Kronicity. First, I found a developer in hartford, CT that outsourced his work to Egypt. He's a very likable and competent sort and, critically, bound by law to adhere to his contract with me. I get the security of a local developer but paying offshore prices. He came with personal references and paid him for a test of his skills that went quite well.

Next I took on a developer as partner. Not just any developer. I found one that I can work with -  not awkward and argumentative. His job is to make sure the contract developer is doing his job, on time and under budget. As a business strategist and paleontologist, I have no idea when I'm having the wool pulled over my eyes. He also utilizes his network of developers to discuss and adjust our development - something I could never do. Bottom line is that his motivation is the same as mine.

The results have been amazing - half the development time and $123,000 less than planned. We've since added development services to GJC Business Strategy Consulting service list. We work with you to not only develop good business, marketing and channel planning, but also build and guarantee the site for a fraction of what most think possible.

We're available for free consultation in the Hartford area. Looking forward to hearing what you're building.

Fo more on the value of Business Strategy, see post: "What Does a Business Strategist Do?"

BOOTSTRAPPING or HOW MUCH CASH DO YOU REALLY NEED?

Here's the scenario I encounter almost daily: Entrepreneur has great idea in great market and wants a half a million dollars to get started. And that half million is earmarked for founder salaries, administrative costs, office space, new equipment and so on. And they're quick to point out that this "investment" will pay off for the investor because the idea is just so right.

Problem is that experienced investors invest in proven entrepreneurs - ideas are a dime a dozen. And I'm not talking about an investor with a track record of one or several successful businesses. What the investor is looking for is an entrepreneur that can get things off the ground without investment. A crafty individual that can leverage assets, utilize collaborators, and put some personal risk into the game. Someone who can move the needle forward just enough to validate the business model and more importantly, his or her abilities. Someone who needs some cash to take the proven model to the next level.

So, if you're just starting out, consider these two steps:

1. You don't need as much cash as you think. I wish I had a great class A space office to work out of the luxury of a salary to allow me to focus on building my business. But in reality, no one, outside a wealthy relative, is going to fund this. And this is a good thing. This forces you to work hard and act fast. And every good entrepreneur needs to do both, because your competition definitely is. And choosing to spend cash on new equipment and expensive office space is a clear signal to an investor that you're really great at wasting cash.

2. You are going to need cash, a whole lot of the stuff down the line for growth. Good business strategy plans for this with projections. And an investor is looking to invest in this growth and the entrepreneur that has realistically planned for this on top of the startup bootstrapping.

Summing up, investors invest in great people who can bootstrap a great idea and anticipate long-term costs. Be that entrepreneur. Getting from here to there is business strategy. It may seem academic, but nothing is more critical to an investor. When he or she asks the tough questions, have the right answers.

So-Called Entrepreneurial Expert Part 2

A developer/investor and all around genius at everything according to himself decried Kronicity's mission and vision as too broad, demanding "Do one thing and only one thing!" He complained we were timeline generators - I never stated that and were, 'cause we're not. He complained about our market segment as well stating that our focus should be "schools or not schools" and not the general public. He said commercial accounts for health and fitness and music were way too different and would doom Kronicity to failure.

Idiots like this are really great at quoting crap like that without actually understanding what the originator of the statement meant. Kronicity does focus on one thing. It's in our Vision and Mission Statements:

Vision (Where we tell ourselves we want our future to look like)
Provide validation, perspective, and enhanced value to the internet by becoming the world's next technological jump in how data is collected, disseminated, and integrated into the human quest for knowledge.

Mission (Internal statement of How we plan to do it)
to create a web-based platform for easy data collection, organization, validation, and value enhancement from any source. 

We're not a collection of timelines and we don't create content. We provide tools for others to do this in any field of study. I mean seriously, does microsoft office focus only on law practices? Does google focus solely on schools as a market? Absolutely not, they provide tools to be used in ways they never considered. 

Lesson here is to understand your product and its market segment. You've been living this project for months or even years. If someone thinks they understand it after a few minutes and insist they know better than you, leaning on a stack of best selling How To books, just walk away.

What you do want to look for is an investor who will ask more questions than dwell on obstacles. The fist meeting is to understand the product and the market. If you can't get past that, stop. If they do understand both and have valuable insights, usually from working in that market, start the dialogue.

Five Minute Expert Critiques

This Blog was started to promote my consulting business by sharing what I've learned from 29 years of independent consulting work and from lessons learned obtaining my MS in Technology Commercialization. But lately it seems to have morphed into a journal, nay, a sounding board for frustrations I've encountered while building Kronicity.  One of my partners laughed that it would be great to have Kronicity fully developed to chronicle all these frustrations along a timeline. With any luck, that's 12 weeks away and I do plan to use it for that purpose.

Today's frustration deals with entrepreneurial experts - and who isn't one today. After all, the $12.95 latest "How to think outside of the box" book that literally ships to the newly minted expert in an actual freaking box is all it takes. They're usually 200 pages of mantras that could fit on a post card - easy to understand and repeat. I was actually able to mouth along with the objections of one self ordained expert as he quoted from one of the more popular best sellers. I reactively argued my point with a few of these fellows, but only a fool argues with a fool and I've come to understand that a polite and rapid exit is usually the best thing to do.

One of the latest in my long list of frustrations is from a so-called Venture Capitalist. He passed on Kronicity, as if I was actually considering him, citing we had too many partners and our target market was too difficult to work in.  But I didn't have to argue with the guy. He'd already let loose the reasons not to.

First, he described how he'd made a mint from selling a tech-based company.  Had he left at that, I'd have lengthened the conversation a bit. But I used a technique I've adopted years ago.  I let him keep talking. He continued to describe how he knew absolutely nothing about the industry he operated in, that it developed in the early 1990s and the real kicker, that he started it as part of his dad's business at dad's request and, of course, funded by dear ole dad. I immediately thought I should be talking with dad. But I kept quiet and it got better. He then complained that I had too many partners to deal with. I have seven critical thinkers in my business including myself. He and his accountant then started talking about diluting the current partners as quickly as possible. Hello! I'm right here idiot! He then concluded with talk about how rich he was and how my financial needs were nothing to someone like himself.

This guy was telling me he was going to be trouble, would create a hostile environment and had an inferiority complex in our first five minutes. A few more minutes of complaining about how difficult it was to sell to schools made it obvious he didn't even understand our business model. We're free to schools.

As for it being difficult to work with schools, everything your dad doesn't fund is going to be hard dude. Obstacles are opportunities for entrepreneurs.

This may be the first of a series of posts as my encounters are so numerous. But, ending on a positive note, I've managed to avoid a host of these self appointed experts forcing me to be clever enough to fund Kronicity with minor investments in cash and major investments by qualified partners and collaborators. We're a better company because of this. And by the way, I believe there were nearly 50 equity partners in What'App that sold for $19 billion. You can dilute me all day long for those figures.

Customer as Product

My startup, Kronicity, is building a free site with paid upgrades, of course, designed to scale quickly. This scale will be monetized through a humber of means. The latest, I read a How to think out of the box book that came in an Amazon box, argued that my user was the product and my customer was the marketer and that I should build for them. He pointed to Twitter users as product and marketers as the actual customer.

Here's my take. There is no such thing as a user who is only a product. The user is both customer and product. Kronicity is designing for two customer segments, the user and the marketer. I FIRST have to develop a product the user will love and use. Only then will I be able to market to the marketer for all that lovely advertising money.

There's a pretty important distinction here. Defining who your customer is is critical. Every feature and design decision must focus on customer experience and customer perceived value. If you're monetizing your users, you have at least two customer segments. This requires viewing your product through two lenses and building two marketing strategies. And, if done properly, seamlessly integrating both segments into all planning phases.

What Does a Business Strategist Do?

The simplest explanation, is we consider and align every possible aspect of a business. Think of your business as a natural extension of the natural world, which it is. Alexander Pope’s reference to a “Vast Chain of Being” applies to the interconnected parts of a business just as much as to the success or failure of a species in the wild. Cockroaches, for example, are really well-aligned animals. Mammoths - not so much.

https://upload.wikimedia.org/wikipedia/commons/0/0a/MammothVsMastodon.jpg

How We Do It 

We do this utilizing a large number of tools and usually involves enlisting the advice and assistance of numerous other experts. I could talk all day about this, but let’s try to break it down into a few simple components.

Competitive Forces Analysis 

Most startups think of competitors as the firm down the street competing for the same customers. And this is partly true. But trust me buddy, there a whole lot of other things trying to kill you. Is the technology ready for your product? Is the customer ready? Can they find a cheaper alternative? Are economies of scale working against you or in someone else’s favor? Has your competitor locked up all existing manufacturing and distribution?
By example, did betamax fail because it was too soon for a new media format? Or was it that VHS aligned themselves with Blockbuster to create a customer pull strategy? If so, VHS succeeded because they identified the superior product competitor and outcompeted with a superior distribution channel.

One of my favorite examples is a lawsuit, “Silk” versus the Milk Industry. It was settled with a collaboration where Milk wholesalers distributed the “Silk” product. In this case, the milk industry recognized a potential threat and decided to join rather than fight. Distributing gave them insights and profits. Silk recognized a powerful competitor and ore importantly a potential collaborator that provided them with a a well-established efficient low-cost distribution and marketing channel. The consumer won as well. Quoting Charles Darwin: “In the long history of humankind (and animal kind, too) those who learned to collaborate and improvise most effectively have prevailed.”

These are just a few of many competitive forces to consider. A business strategists considers all of them and recommends solutions and strategies to accommodate.

Channel Design 

Understanding the competitive landscape is critical in identifying channels that need to be developed. The “Silk” example above was a very efficient and low cost solution to a problem most businesses face. Recognizing the actual competitive forces allowed them to collaborate and not only eliminate competition, but to develop low cost distribution and marketing channels. Most startups instinctively and reflexively seek the lowest-priced raw materials and manufactured goods. Big mistake! Your product is priced based on overall cost to create and deliver to the end user. A high priced manufacturer may also have well-established channels/access to your customer. They may open doors to new customers, share marketing costs, even distribute for you. Understanding channels is critical.

Financing 

Let’s assume you’ve developed a better mouse trap that requires only biodegradable paper components. And you only need a $40,000 to get to market. As a business strategist, my first thought is to negotiate a partnership with a paper manufacturer to produce the product at cost, reducing your cash needs to about half or $20,000 and then borrowing that cash from the same paper manufacturer. Of course it would have to be a damned good mouse trap. But even if deemed a risk by the manufacturer, with a good marketing plan, such as using their distribution network, there is still some room for negotiation.

Marketing 

Align all the parts! Can your customer be reached through an established network? Are any partners in your channels connected to them? Lord knows your manufacturers are vested in your success. Perhaps there’s a collaborator with a complimentary product? You could share costs and tap into each others customer base. The competitive analysis above can fine tune who your customers are and better target your campaigns. Your partners can share insights on what worked or didn’t work for them. Have you identified substitutes that you have to position yourself against? I witnessed a customer at a high end tea shop complain she could find an oolong at a quarter of the price the shop was asking just down the street. The manager responded that they too could sell cheap oolong but decided to maintain high quality tea did not compete on price. he shop had done their homework, priced and packaged and marketed accordingly. The customer paid the price.

Communication Channels 

How many times have you gone to a retailer or restaurant and was so disappointed in the service that you never went back. Or maybe you had a suggestion that would have really helped out a new small business. I pity the poor business owner who doesn’t know of your experience nor learned of your suggestion. But in reality, it is their fault for not having established communication channels that make it easy for customers to interact with your business AND for employees to act on this data. And this communication extends from customer to business owner and straight on back to manufacturer and raw goods provider. And a well designed communications channel allows a business to respond quickly to change. Again, I quote Darwin: “It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change.”

As you can see, just as in the “vast chain of being” in the natural world, there’s a lot of overlap in all categories. Aligning them is critical to survival. Your goal as a business owner or manager is to try NOT to be a mammoth. We can help.

How to Avoid The Crazy Developer Partner

Chances are, as a startup, you need some development work. If you're NOT a developer yourself, consider these rules for developers.

RULE One:

NEVER make the guy developing your product your equity partner. NEVER! If you don't speak the language, be it HTML5, or java, or what the hell else, you're at his or her mercy.

RULE Two:
See Rule One, there are no other rules.

I personally have had more smoke blown up my ass by partners that are developing products for me than I care to discuss. But I have found a solution that I desperately want to share.

A developer is the most important stakeholder in your business. But never have that person develop your product. There's a serious conflict of interest there. If you can afford to, hire one as CTO to handle your development work. Their role is to understand the product, assist with development of the product specs, create requirements documents, assist in development of developer contracts, and critically KEEP AN EYE ON THE DEVELOPER BUILDING THE PRODUCT.  If you're cash poor, partner with one for equity.

Considering each part of the developer partner's role, understanding the product is key. If he or she doesn't get it after a meeting or two - LOOSE 'em. They never will get it and can't help you. Some will actually argue that features are needed or not needed based on their $12.95 how-to for startup book, when they are actually guiding you to change the product to suite their development skills. If they can't build an iFrame, they simply argue it's not needed.

Your CTO should be able to assist with development of the product. Again, after two meetings they should be able to not only understand the product but be able to offer unexpected solutions that enhance the product and not change it.

Product specs are critical when outsourcing development. The CTO developer is best suited to do this.  This is an accountability checklist for the developer building the product as well as the developer guiding the project for you.

Developer contracts have been around for decades. They point to the requirements document and require deliverables to be paid. Your CTO should have these at his disposal or be able to create one. Of course you'll want your lawyer review this. Your contract with the CTO should list his duties in detail as well.

Finally, both the CTO and Product developer must meet certain personality requirements. Let's be honest, folks who couldn't possibly make it working with the public, children or with normal humans can find work and happiness securely hiding behind the glowing screen. And steer clear of the developer who is an expert at everything entrepreneurial as he read the latest $12.95 How-To build a startup business book. Appropriate folks are out there. So don't let desperation and frustration tempt you to tolerate or, heaven forbid, to partner with one of these guys.  If the product is a good one, FIND A STRATEGIST TO ALIGN IT, TO ATTRACT STAKEHOLDERS, AND TO FUND IT.

A side-note: If you already have an impossible developer-partner, and you know deep inside that you do, dump him or her at any cost as soon as possible. 

A good startup strategy starts with a great team that includes a developer. If you're not one, take on one as partner or hire one to guide and advise. At George J. Constance, Jr., Business Strategy Consulting, we align your business with the market, key stakeholders and away from the dangerous alliances that can kill even the best ideas.

We're adding In-House Development to Our List Of Services!

The best lessons are the ones that burn the most. My latest is a real doozy.

I was recently put through the ringer by a developer who insisted I create detailed requirements documents for every freakin' thing on my proposed site. How to login, what to data to collect, and what message to display when something went wrong. After a year and half of not getting anywhere, aside from really neat requirements documents, I fired the developer and went with another guy. The new guy didn't require a single document from me. He looked at images of what I wanted, asked I annotate some and took notes. A few weeks later he delivered a pretty close working beta that we used to fine tune the next set of notes he took.

Here's the difference, new developer asked why would I waste time developing such detailed requirements when he, like most developers, was going to use well-designed and well-tested plugin from a library of features, login included. He then showed me samples that allowed customization and included features neither one of us considered.

Bottom line and lesson I took, was find a developer who thinks like a startup. New guy wasn't interested in process, nor paranoid about finger pointing later. As a service-oriented developer, he took responsibility for documentation, a few hand notes and a drawing in this case, upon himself and started work immediately. It took us an hour to get requirements down and 5 weeks to deliver.

I've added new guy to my arsenal collaborators and now offer development work for your startup or growing business. From concept through web development, marketing and sales, we deliver. And we align all of this for maximum efficiency - saving you money and getting up and and running in a fraction of the time most others can.

So call us!

Entrepreneurial Course at MCC

As a business strategist, I charge $210 per hour. Not the best option for most cash-strapped startups. But because I know a few of them, like Satto Technologies, may have really high potential, I tend to let the hourly rate slip for the first few causal meetings. Great way to screen potential clients and to offer help to some folks who just need it.

I still offer these casual meetups at cafe's and co-working spaces. But I've also added a new strategy - I'm teaching a 2-day weekend course on entrepreneurialism at Manchester Community College's Viscogliosi Entrepreneurial Center. Great way for me to meet and help a large number of startups and save them a great deal of money.

So, if you have a startup that's struggling or considering starting one, I'd love to hear all about it, share my insights and offer resources.

BUSINESS The Entrepreneurial Sequence for

Business Start-Ups

CRN 20802 | Fee: $165 2 sessions, Saturday & Sunday | 7/25-7/26 10 AM-4 PM | MCC on Main

Instructor: George Constance

For full course description, see page 47.

https://www.manchestercc.edu/wp-content/uploads/2015-Summer-Credit-Free-Catalog.pdf

Seek YOUNG Investors

Had an interesting conversation with Jennifer, an acquaintance and fundraiser for a large non-profit. She really liked my approach to business strategy development and thought my project portfolio was interesting. She also had some really interesting isights into funding new ventures - go after young technology-based employees. Fascinating approach that she backed up with a story about an investment her son made in Silicon Valley that I had to write about. But first some history.

In the early days of coffee shops, that soon became teashops, a small cafe in a shipping district of London noticed they had a lot of ship's captains seeking insurance that drew a lot of insurance agents into the shop. Being a good marketer, the owner of the coffee shop began posting a list of ships, cargos, and captains, along with insurance needs on his wall. Business boomed and he noticed a need for a third party to negotiate the contracts and the waiters quickly became skilled brokers. Coffee and tea soon became a distraction to the real business, insurance brokerage. Today, when visiting Lloyd's of London, you still meet with a waiter and not a broker.

Back to our story, Jennifer described how young, unattached and over-paid developers would congregate at coffee shops in the valley where they invariably would discuss new ventures they were working on or heard of and, of course, the cash requirements to launch. The owners almost daily noticed tens of thousands of dollars being pooled for exciting ventures. Like Mr Lloyd nearly three hundred years earlier, the coffee shop owners began to invest and broker deals and opened two additional shops for that purpose. Jennifer's son invested in the second shop. The owners didn't need an investor for the third shop.

Lesson for entrepreneurs everywhere:

1. Move to Cali
2. Pitch young folks who know other young folks that can pool resources. These folks are capable of dropping a few bucks without sacrifice and tend to be more future focused than older folks. They'll invest in a deal that might take a decade to make them uber rich. 3. Young tech savvy investors can contribute to your business and are super connected marketers

Older Entrepreneurs in America

"15 there's still time for you, time to buy and time to lose" are haunting lyrics from the song "100 years" by Five for Fighting. And so applicable to the entrepreneurial world and life in general. Time to lose means time to recover.  And in America, any financial disaster is survivable with enough time. But how much time is enough. Surprisingly little I've discovered.

At 25, working as an oil industry paleontologist, I was offered a chance to invest in an oil well that a geology school buddy and wildcatter was drilling. It was only $7,000 for a potential 12 feet of pay and substantial returns. I looked over the science and invested immediately. A few days later, the well not only hit the 12 feet, but another 20 feet in addition. I was buying a house with that $7,000 investment! The next morning, unfortunately, my buddy called with the bad news. The well was tight, that is the oil couldn't be recovered and I lost my investment.

No big deal, I was young, earning cash, and had no dependents or heavy debts of any kind. I asked my buddy to let me know if another play came available. I had time to not only recover, but do it again.

Fast forward to August 28th, 2005 at age 45. After shuttering my paleontological consulting firm, due to an industry downturn, I had just literally shuttered my new tea and spice business, profitable after only 12 months in business, preparing to weather Hurricane Katrina. Twenty four hours later, I was ruined, like the city. What was I to do, aged 45. Did I have time to lose at this age.

Turns out I did. I reapplied my small business expertise, my consulting expertise and knowledge of species competition into a business strategy consulting firm that focused on competitive analysis.  It wasn't easy. There was a bankruptcy and a MS degree in Technology Commercialization earned along the way. But, unlike in many other nations, I wasn't punished for failing and recovered. And I'm looking forward to my next endeavor that launches next Spring and promises to earn me a bundle - again.

Critical at any age, is understanding the entrepreneurial process to avoid wasting time and money. GJC Business Strategy Consulting is dedicated to helping you successfully navigate through your next venture - at any age.

Startups Need Collaborators Not Capital

Creating a business plan to raise capital is a great growth strategy for a new and expanding business. But it's nearly impossible for a startup. Its just too risky an investment for traditional cash investors. A much better strategy is a collaboration with a partner who could benefit from your business and will eliminate or greatly reduce your need for cash.

Artists, for example, have placed their work in cafes to eliminate the cost of a private gallery. The cafes get zero cost decorations. If it's a good collaboration, the art will coordinate with the cafes branding. And by splitting profits of sale of the artwork, both parties benefits both.

This same sort of collaboration can apply to any industry. In fact, a business strategy, especially for cash strapped startups, should include the potential for a collaborator in the planning phase. Take the milk substitute "Silk". A lawsuit filed by the milk industry because of the similar name ended with a collaboration that had the milk industry acting as distributors for "Silk". The agreement not only saved the manufacturers of "Silk" the cost of establishing a distribution infrastructure but also provided a large established network for the product. Everyone won.

Lesson here is to consider all channels in your business from manufacture to retail distribution. Do you see any opportunities for your business and another? Do you have a unique skill or product that can compliment another business? Can you increase THEIR bottom line while reducing your costs or increasing your profits? And, critically, considering this before launching can guide your business strategy, including pricing, identifying the market segment to target, and identifying managerial systems to develop. The end result for the startup is faster market entry, more efficient operations and enhanced profits without a large cash expenditure.