When I founded my software company so many years ago, I was fortunate to have an immediate client who actually paid me well for my time. As my company and my relationship with this client expanded, we were also able to get paid to develop our software product. In essence, our software was customer funded and required no more outside capital than a line of credit to get us over certain growth spurts. We were able to parlay revenues from our services into the areas of our business we needed to grow. We bootstrapped.
Although we sold software, the majority of our revenues came from services, so we determined our budget based on how many hours we might bill and projected out from there. Borrowing or raising capital never entered my mind. Oh, I remember stating early on that I wasn’t looking to be the next Microsoft, but I also remember distinctly the reason: I didn’t want to lose control. Even though our company grew to multi-millions in revenues from what I considered being scrappy, I honestly think I was afraid of too much success.
I don’t know if I’ve always been that scrappy, but looking back I realized I needed to be to get through college. I had to work 3 jobs at one time to pay for college myself (eating Ramen Noodles in the tough times) because my parents didn’t have the means at the time. But at least then, I filled out every application for a scholarship I could find and opted for all the student loans possible. So why didn’t that translate into my business years later? In my first business, I never really thought about what I could do with someone else’s money.
Last week, I attended a focus group of sorts at the SBA headquarters in DC sponsored by the National Women’s Business Council (NWBC) to talk about women business owners and capital. It was an exploration of the issues as they prepare to give a summit on the topic for women business owners this Fall. Admittedly, I almost didn’t go. For me, home to downtown DC can be anywhere from a 45 minute trip when I drive and there is no traffic (and I make every green light) but is more often an hour to an hour and a half. These days, I have so much going on that I try to cut out any extraneous out-of-the-office excursions but something drew me downtown that day. I didn’t know what to expect but absolutely got more out of it than I had anticipated.
What the group lacked in size (there were only about 5 of us) we made up for with enthusiasm and diversity of perspective. The experiences varied from those of us with fairly low capital needs in the past (I had a line of credit in my first company that I only tapped into two or three times) to the real estate developer whose assets include more than one multi-storied building and borrowing needs well into the millions. Without breaching confidentiality I can only say that it was a heated, animated discussion which, at times, involved more than one 4-letter word, which really
caused me to think: how many women believe or behave as if wealth – or even money – is a four letter word? Does a woman’s relationship with money impact her business approach and, ultimately, goals?
I was talking with a friend the other day who recently started a business pursuing her passion. She was able to move into securing billable work relatively quickly through word-of-mouth and her network of contacts. As she is branching out, she is looking to develop a more formalized statement of services and marketing messages. The thought of it all, she lamented, was bumming her out. She wanted to DO the work but found herself needing to spend more time than expected to set up the business. Unfortunately, this is not at all unusual. Many people start a business to do what they love and then realize there so much involved in starting a business that its becomes hard to find time to do the “fun” stuff you started the business to do. You need more hours in a day to do both. That’s why it is crucial to find something that drives you – a passion – so it can feed your energy rather than drain it. The best book I’ve found for exploring solutions to this dilemma is The E-Myth Revisited by Michael Gerber. If you’re starting a business and haven’t read it, I highly recommend it.
We were talking about her business – a service many people could use – but I was (in my normal boot-in-the-butt form), asking who her target market was. Had she chosen a niche? What was her marketing strategy? The blank but overwhelmed stare told me what I suspected: she didn’t know. Now this is a really smart lady, but she was visibly frustrated by not having answers to questions that apparently nagged at her as well. What she had discovered is a trap many entrepreneurs fall into: shoot first, ask questions later.
I see it all the time. I have an idea/skill/talent/product. I think it is cool, that people need it. My friends and family see the need or the value, but that’s as far as I’ve gone to validate my idea or my fine tune my approach to the market. And when the capital requirements tend to be low, it is tempting to just quickly hang out a shingle and call it a business without doing any serious primary market research. In my experience, this can be deadly.
An elevator pitch is what you answer when someone asks you “So what do you do?” Everyone has one regardless of whether you’re in business or not. I came across the following company description on a website the other day and I have one question: What does this company do?
“Our success is built on a commitment to provide quality service, tailored to individual company needs. Our business is in providing high quality services in all areas of service we provide.
We are a team of highly skilled professionals with a proper blend of Experience, Reliability and Skill to provide high caliber solutions for a wide range of Industry challenges. We offer a variety of professional, affordable & personalized service capabilities and our commitment to reliability, quality & excellence is equal only to our dedication to our customer’s satisfaction.”
The more I talk to entrepreneurs and business leaders, the more I realize that so many of us share similar experiences. A dear friend recently received a call from her largest client – they were considering cancelling their contract with her firm. Nice timing – happy holidays. The frustrating thing was that it was a political decision, not a financial one. Ugh. Bad news that makes sense is a lot easier to handle. Getting kicked in the gut over political positioning within a company can be unbearable.
Her dilemma brought to mind a similar experience I had several years ago when my largest client lowered an equally devastating boom. I was actually out of town meeting with this client when the fairly-new manager (and career politician within the company) took me out to lunch. Just as nice as can be, he said “We’re replacing your software with our company standard offering…but we’ll give you a great reference.” That’s like the dreaded I want to break up but we can still be friends.
This news was not a complete surprise to me. I had been part of the team evaluating our software against their corporate standard solution. The team had determined that the systems they were currently using (ours!) were better suited to their operations and switching offered no clear financial benefit, which is what made this so much more difficult. The verdict made no logical or financial sense.
When I started my first business almost 14 years ago, I had no idea what “Intellectual Property” (IP) meant or how it applied to me. Nowadays, I hear that term ALL OVER THE PLACE. In fact, I’m teaching a couple of entrepreneurship classes where it comes into play and I’ve found that people don’t really understand that the only thing IP gives you is the right to protect it. It gives you the right to sue someone else for infringement.
Case in point: an article this week in our local paper about a company selling Cuff Links calling their company Cuff-Daddy. Sound like any rappers you know? Yes, Sean Combs is trying to block their use of it because it sounds like his nickname, Puff-Daddy. I could see that. The thing is, he isn’t being mean or nasty, he’s just protecting his brand. If you don’t protect it, you actually lose the right to do so.
No doubt if you’ve read any news medium in the past few days, the story of Michael Phelps‘ incredible gold medal run at the Olympics in Beijing. In the U.S. especially, his 8 gold medals is already becoming a legend. In reading about his extreme focus and physical determination I’ve come to the conclusion that I do not have what it takes to reach that level of athleticism. It is just not in me. So what, then, can we mere mortals learn from his – and every other Olympic athlete’s – experiences and successes?
Linda Robertson in an article for the Miami Herald provides great insight:
“Five years ago, when Phelps first plotted his record, it seemed like a presumptuous, wacky fantasy. He was like a baseball player declaring he would break Joe DiMaggio’s 56-game hitting streak. He was like an astronaut declaring he would step foot on Mars.
Have you ever dreamed or even considered starting your own business? Do you know you want to be an entrepreneur but maybe haven’t found that killer idea or unique business proposition yet? If so, the ACTiVATE program may be for you and we are actively recruiting potential women entrepreneurs for the Class of 2008.
Don’t worry if you don’t have an idea for a business – that is part of what we help you with! We provide you with lists of technologies (patents and copyrights) from Maryland Universities and government labs which are available for licensing. Then, we take you through the licensing and commercialization process with the hopeful outcome that you will launch your own business at the end of the program (or before, as the case has been!).
I am going on my 4th year with the program and my 3rd as the Lead Instructor. I can honestly say I have never seen ANYTHING LIKE IT. First, it is taught and led by seasoned entrepreneurs who offer their practical experience with a no-holds-barred approach to sharing the good, the bad, and the ugly. You get the opportunity to learn from our mistakes and build on our successes. Second, this is a HANDS ON program, where we measure success by your success in starting and building a viable, sustainable business. Third, the cadre of women who have gone through ACTiVATE, many of whom have started their own business as a result of the program, provides a support and networking group that is unparalleled in their experience, connections and desire to help each other succeed.
I found Family Matters Radio on the internet and after listening to a couple of interviews by Caroline and Jacquie, I just knew I wanted to talk with these dynamic women! We had a fun conversation – check out our radio interview (scroll down to the audio portion)…
Last week, I attended a focus group of sorts at the 
Revisited
needs. Our business is in providing high quality services in all areas of service we provide.
The more I talk to entrepreneurs and business leaders, the more I realize that so many of us share similar experiences. A dear friend recently received a call from her largest client – they were considering cancelling their contract with her firm. Nice timing – happy holidays. The frustrating thing was that it was a political decision, not a financial one. Ugh. Bad news that makes sense is a lot easier to handle. Getting kicked in the gut over political positioning within a company can be unbearable.
When I started my first business almost 14 years ago, I had no idea what “Intellectual Property” (IP) meant or how it applied to me. Nowadays, I hear that term ALL OVER THE PLACE. In fact, I’m teaching a couple of 
No doubt if you’ve read any news medium in the past few days, the story of 
on 
on 
