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Archive for July, 2013

12 Questions that Venture Capitalists Will Ask You: Straight from the Entrepreneurs

Posted on: July 31st, 2013 | by Bill Kenney

What Is Your Hole?

“The classic VC role is that of an interrogator, trying to break you for a key secret. But it doesn’t have to be that way. Folks who watch the TV show “Shark Tank” know this feeling. Time after time, a well-rehearsed entrepreneur goes through his pitch, and everyone loves it. But the Sharks (VCs) keep poking at the startup until they finally find a hole. Maybe the company has zero revenue, a poor growth strategy or a weak CEO. Know your weaknesses better than your strengths. Before our first VC meetings, my team sat down and asked each other “gotcha” questions until we were all experts.”

– Neil Thanedar | CEO and Founder, LabDoor

How Are You Different?

“With proper due diligence and competitive analysis, you should be able to make a case for how you differ from other folks in the marketplace. How can you prove that you have a truly unique value proposition? What is it about your offering, your approach, your technology and your team that makes your company able to achieve and execute on this opportunity? “

– David Ehrenberg | Chief Financial Officer, Early Growth Financial Services

How Much Is Your Company Valued at?

“The reason why determining the valuation of your company is so difficult is because there is no right answer. On the one hand, you need to be realistic, but on the other hand, you do not want to undervalue your company, as the VC may think something is wrong. The best way to handle this question, and most others that arise when negotiating with a VC, is to do all you can to have several VCs interested in your company. Like in most negotiations, if you have several interested parties, they may bid against each other, which will allow you to obtain the best terms for you and your company.”

– Doug Bend | Founder/Small Business & Startup Attorney, Bend Law Group, PC

What’s Your Customer Acquisition Cost?

“The best way to tackle this question is to show reasonable estimates for customer acquisition, using well-researched numbers and reasonable conversion rates. If you can’t explain how you are going to acquire customers for less than what you sell them on average, at a fundamental level, you have failed to explain your business.”

 

– Patrick Curtis | Chief Monkey and Founder, WallStreetOasis.com

When Are You Paying Me Back?

“There are many entrepreneurs with amazing ideas. Ideas are a dime a dozen, but execution is everything. Every investor will ask you when and how he will recoup his investment. What experience do you have? What is your track record? Before going into a meeting with a VC, make sure to tell him about your experience, your track record and, most importantly, how you will recoup his money. Lots of people pitch the idea before the finances. Pitch the finances and how the VC will make money; if he asks you a question, then you got him to bite — now it’s all about your elevator pitch.”

– Ak Kurji | Chairman & CEO, Gennex Group

Why Won’t a Huge Corporation Build Something Like This?

“VCs will ask, “Why won’t a huge corporation build something like this and use their existing customer base and capital to capture market share?” The best way to defend against this is to have technology and intellectual capital that the company will want to acquire, rather than destroy. “

– Matt Wilson | Co-founder, Under30Media


Visit alleywatch.com to read the complete article.

Author: AlleyWatch

Do You Have What It Takes? Test My Pitch Calls for Serious Business Networkers!

Posted on: July 24th, 2013 | by Bill Kenney

Would you like to deliver your self-introduction to thousands of people? Would you like expert help improving your self-introduction? Would you like to help others improve their ability to self-introduce? Are you a natural ham?

If so please read on as you might be exactly who we’re looking for!

Test My Pitch is in the process of building an instructional video to help networkers with their self-introductions and we’re looking for co-conspirators. Specifically we are looking for folks who are willing to go through the Test My Pitch process and will allow us to use their incremental self-introduction videos to guide others.

In exchange for your help you’ll not only get a lot of coaching from us in perfecting your introduction, but you’ll also get a lot of good promotion.

If you are interested, please call or email me, Bill Kenney, at 01 (860) 573-4821 or bkenney@testmypitch.

Thanks so much for helping us rid the world of poor communication!

Your Slide Deck Is Nothing but Risk

Posted on: July 22nd, 2013 | by tmpadmin

According to some sources, more than 30 million business presentations are created each day.

And you know what? Most of them are terrible. We’ve all sat through the proverbial terrible presentation with no purpose, nothing memorable, no clear action items, too many slides, the monotonous drone of the boring presenter. There is a reason business presentations get lampooned all the time. How does something become a cliché?

The PowerPoint presentation is an abused and overused method of communication. But when it is done well, the results can be remarkable, because, frankly, the bar is set really low. It’s pretty easy to impress.

So, in my effort to help you impress, here is an important mindset to carry with you when you are preparing for your next business presentation. Your slides can only hurt you. They represent nothing but risk, nothing but downside. It is true, and I can prove it to you.

Imagine that I walk into the room, and speak a great presentation… I am articulate and clear and smooth. I look people in the eye. I get to the point quickly. I do everything correctly, with one exception: I have put a terrible deck of slides on the screen behind me. Just imagine a great presenter with a terrible slide deck. That terrible deck will measurably hurt your perception of that otherwise great performance.

Now imagine the opposite. Imagine that I walk into the room and speak a terrible presentation. I am monotonous. I mumble. I don’t look anyone in the eye. I don’t get to the point. I am awful. But on the screen behind me, I put up the world’s most beautiful, creative, clear, and powerful slide deck. It is a perfect deck. But my perfect deck will never cause you to ignore my otherwise terrible speaking performance.

This means that a terrible deck will hurt an otherwise good presentation. A wonderful deck will not save a terrible presentation. In other words, slides can only hurt you, they cannot save you, and therefore they are nothing but risk.

How do you manage that risk? Simple. Your goal with your slides should be to give your audience nothing to be distracted by. Your goal with your slides should be simplicity, clarity and consistency. Every slide should have a purpose. Complete the following sentence: I am including this slide because… If you don’t have a good answer to that one, take the slide out. And then complete this sentence: The key message on this slide is… If you can’t complete that sentence simply, then your slide is too complicated.

Keep your slides in perspective. Make sure they don’t hurt you, and you are halfway home.

Written by Dean Brenner, The Latimer Group

Want to get crowdsourced or expert feedback slide deck? Try Test My Pitch. It’s FREE.

10 Reality Checks to Verify Your Entrepreneur Fit

Posted on: July 17th, 2013 | by tmpadmin

Making the decision to become an entrepreneur is a major commitment, with huge implications for skills and lifestyle. Yet there is no standardized testing or certification required or available anywhere to help you decide if you are a good fit for entrepreneurship, or entrepreneurship is right for you. An MBA or other academic credentials just don’t do it.

Therefore, the least you can do is take advantage of some of the self-assessment tools and guides around, like “The Entrepreneur Equation,” by Carol Roth, which highlights personal characteristics and skills required. Some day, I expect there will be a more formal certification required, like lawyers and accountants have to pass, to hang out their shingle.

Until that happens, I recommend that you consider the following ten reality checks from Carol and myself on your entrepreneurial aspirations, before you step in so deep that it’s hard to back out:

  1. Critically assess your motivation. Are you bored, wanting to be free of a boss, or eager to showcase a hot technology? These are not valid reasons to start a business. But if you’re focused on solving a real problem, believe you can do it better than anyone else, and confident in wearing many hats, you have the right startup mindset.

  2. Say hello to multiple new bosses. When you start your own business, you are no longer in control. You will likely not have the freedom you dreamed of. You will be controlled by your customers, investors, lenders – and you are personally responsible for answering to all of them, all of the time.

  3. Evaluate how well you work with others. Many people dream of opening a business as an escape from annoying coworkers and overbearing bosses. But now you have to interface with even more people, including accountants, lawyers, as well as clients and team members. You need to be comfortable with people and have sharp people skills.

  4. Add up your responsibilities. Owning a business is very much like raising a child. It’s a 24/7 job. If anything happens to the business (including a loss of income), how will it affect your family or home life? Remember, the buck always stops with you.

  5. Look at your management and industry experience. Being able to manage employees and vendors is the type of skill assumed before starting your own business. You’ll also need to know your industry inside and out. It helps to work in a similar company before you start your own.

  6. Take stock of whom you know. Business comes down to not what you know, but whom you know. Good connections are worth their weight in gold. They will get you interest from investors and lenders, and you will receive better financing, prices, terms, and conditions from business suppliers and professional services.

  7. Be honest about your relationship with money. Don’t expect your relationship with money to change just because you’ve opened a business. Opening a business requires money, as well as sound financial management. Do you panic about spending money or avoid financial risk at all costs?

  8. Assess your personality type. If you are a person who likes stability and control, or if you prefer when things go as planned, the roller-coaster ride of a new business may not be right for you. Every new business has highs and lows, and plenty of the unexpected.

  9. Examine the marketplace and your competition. To brand your business and woo investors, you’ll need to understand why and how you can outshine competitors. Both good and bad competitors will influence how successful your business will be.

  10. Test your scalability. Successful businesses rely on automation and delegation. Will you be able to teach other employees to do your work? If your business relies on your brain and skills alone, you might have a successful job, but not a successful business.

Please don’t take these steps as being too negative, but do remember that the risks are high. Statistics say that the failure rate for new businesses within the first 5 years is as high as 90 percent. That should indicate that a lot of entrepreneurs get more than they bargained for. Think twice before you invest your precious time, money, and energy, and then go for it!

Written by Marty Zwilling from Business Insider.

Give the Perfect Elevator Sales Pitch

Posted on: July 16th, 2013 | by tmpadmin

Can you tell what you do in a compelling way? Believe it or not, most people can’t. Here’s how to do it efficiently and effectively.

Ah, the classic elevator pitch. It’s a challenge every entrepreneur, marketer, and sales person must meet, and yet most do it poorly. The concept is simple: communicate what you do in the time it takes to ride an elevator from ground level until the door opens and you have to leave. Of course, those of us living in New York have the advantage of very tall buildings. Truthfully though, you have about 1–2 minutes to leave an impression powerful enough to get someone to continue the conversation after exiting.

Everyone needs a simple and compelling way to explain what they do. It’s the key to successfully prospecting networking events, chance meetings and parties for new business. But unfortunately the way most people explain themselves comes off self indulgent and boring resulting in wasted conversations and fruitless encounters.

Here is the typical wrong way:

Hi, my name is Frank Smith and I am the CEO of Smith Marketing Services. We help companies grow and we give great customer service. Do you have any marketing needs?

The people on the receiving end may or may not think they need a marketing company. Most likely, they are only thinking about what they are going to pitch to you.  This pitch does nothing to compel people to engage further, only to continue the conversation in hopes you want to buy what they are offering. Ultimately everyone’s time is wasted.

A powerful elevator pitch, however, communicates a compelling value proposition that attracts customers predisposed to buy.  It can help you efficiently weed through a large group, stopping only for meaningful conversations with real potential customers. Here is a step-by-step process on how it’s done:

Step 1–Connect with Empathy

Create a specific pain statement for the customers you want. You really only want to talk to people who are willing to pay for the problem you solve. Otherwise you are wasting your time and effort.  For example:

You know how growing companies with revenue over $5,000,000 struggle with getting salespeople to say the same thing, let alone the right thing? Often they grow on the sales ability of the entrepreneur, never putting efficient marketing systems in place; then they hit a plateau and can’t scale.

If the people hearing this don’t get it or know someone who would, they can answer no and you can move on, having wasted less than 20 seconds.  But if their company is suffering from the issue you outlined you’ll be able to witness their face drop as they identify painfully with the scenario.  Now you immediately look smart and empathetic as they affirm that the picture you painted is terrible and frustrating. You have gained their attention.

Step 2–Offer an Objective Solution

So now they are listening and they just got vulnerable. No need to put them on the defensive. They are thinking you might be pretty smart and insightful. Don’t prove them wrong by trying to close just yet. Continue showing them how smart you are by offering up an objective solution to their issues. Begin with the entrepreneurial mantra: Wouldn’t it be great…? For example:

Wouldn’t it be great if there were a company that could design and implement comprehensive marketing that makes your sales process efficient and lets your salespeople close more deals?

If people don’t respond positively to this statement then they weren’t really connecting in Step 1 and you can dump the conversation having only wasted 30 seconds total. Those who connect should be now hanging on every word and nodding their heads, thankful that someone finally gets their frustration.

Step 3–Provide Differentiation

Now they are 90% there. The best way to close is by explaining why only you are the best to provide the solution they need. You have to ready a couple of points that truly differentiate you from your competition. Note that “Experience” or “Great Customer Service” won’t make you stand out since all of your competitors claim the same even if it’s not true. A true differentiator is something your competitor can’t do or won’t do without great effort or expense. Here’s the finish:

My company uses proven project management and storytelling techniques honed from our background in theater. Additionally we use proprietary processes outlined in my #1 bestselling marketing books and my national column on Inc. Perhaps I could send you a link to my column or a couple of chapters from my books?

If they say no, you only wasted 1 minute. If they say yes, you have succeeded in starting a conversation that may lead to business.  The last line is incredibly important because it gives you permission to get their email and pursue a relationship. Even if you aren’t a writer, have compelling content like white papers, videos or blog posts ready to email and support your pitch as promised. That way you won’t have to carry a ton of collateral into every elevator.

Article from Inc.

The Art of Concise Communication – 5 Valuable Tips

Posted on: July 11th, 2013 | by tmpadmin

Most pitch coaches agree that it is easier to do a 20-minute pitch than a 1-minute pitch. How can this be? How can having to build content 20 times longer be easier? The primary issue is that short communication takes a level of precision that long communication doesn’t need.

Winston Churchill used to say that it would take him “four days to develop 5-minutes of extemporaneous remarks”. Concise communication is an art form that is entirely audience centered. All of the fluff is stripped away so that the meaning is self-evident.

Few of us remember the name of the noted orator, Edward Everett, who spoke two hours at the Gettysburg battlefield. Instead we remember Abraham Lincoln and his two-minute “Gettysburg Address.” Everett, in a note to Lincoln afterward, said, “I should be glad if I could flatter myself that I came as near the central idea of the occasion in two hours as you did in two minutes.”

Here are some tips for being concise:

  • Keep sentences short – The self-discipline to do that will aid you in making your point quickly.

  • Avoid unnecessary words – Imagine hearing a television weather person, using a map, say, “This is where we are at, right now.” Just saying, “This is where we are” would have been sufficient. “We are here” would have been even better. Avoid “kind of,” “sort of,” “basically,” “actually,” “generally,” and “definitely.”

  • Avoid jargon and acronyms – Techspeak is risky. It is likely that some or most of your audience will not understand it.

  • Always revise – When revising what you plan to say or write, you will usually be able to say the message with fewer words. When you revise, you can discover more specific words and eliminate vague referents such as “it” or “they” and substitute with more concrete terms.

  • Get feedback – It is easy to fall in love with your own words. Testing your message by sharing it with others and getting feedback will remove your communicators bias.

Conciseness is saying what needs to be said with the minimum number of words. As Joseph Conrad said, “He who wants to persuade should put his trust, not in the right argument, but in the right word.”

More Concise Communication Wisdom

The chief virtue that language can have is clearness, and nothing detracts from it so much as the use of unfamiliar words.

Hippocrates

The ability to simplify means to eliminate the unnecessary so that the necessary may speak.

Hans Hofmann

The most valuable of all talents is that of never using two words when one will do.

Thomas Jefferson

The letter I have written today is longer than usual because I lacked the time to make it shorter.

Blaise Pascal

Speak properly, and in as few words as you can, but always plainly; for the end of speech is not ostentation, but to be understood.

William Penn

Words are like leaves; and where they most abound, Much fruit of sense beneath is rarely found.

Alexander Pope

The shorter and the plainer the better.

Beatrix Potter

One should aim not at being possible to understand, but at being impossible to misunderstand.

Quintilian

Do You Have the Mind of a Startup Entrepreneur?

Posted on: July 8th, 2013 | by tmpadmin

Are you a transactional or transformational leader? According to Top Management Degrees, a blog that serves as a guide to management degree programs, your answer could go a long way to determining if you have what it takes to be an entrepreneur.

The infographic below highlights some of the things that help a startup entrepreneur go from idea to an actual startup. TMD’s data, referenced at the bottom of the infographic, promises to take a look “inside the mind of a startup entrepreneur.” Transactional leaders, they say, are destined to be the CEO of a well-established company, often traveling up the ladder of success. The transformational leader, on the other hand, is the one who’s cut out to “shift the paradigm”.

They’ve also assembled a wide range of quotes; from luminary entrepreneurs including: Bill Gates, Steve Jobs, Larry Page, Catherine Cook, and Mark Zuckerberg, to support their theory about startup founders, entrepreneurs, and eventually leaders.

Does this infographic describe you? Check it out below:

entrepreneurs