Business and Startups | Startup Addict Musings

Vermont my neighbor state is known for being a little different and you can add requirements for Limited Liability Company formation to the list. Apparently on June 6th a bill was signed that will no longer require LLCs to have a physical address (in Vermont anyway). This trumps Delaware in startup friendly law and will enable Internet startups to flourish by existing only virtually if so chosen.

Unfortunately, this will probably allow fraudulent companies to flourish as well. However, the bill does have merit in the Internet age with companies being created as holding companies for blogs or other web-based use.

More Coverage over at OM

Entrepreneurs head to RaiseCapital

Last modified on 2008-06-08 01:51:41 GMT. -1 comments. Top.

I receive a fair amount of solicitations for free plugs but when Maureen Mecke from 5W Public Relations sent one for RaiseCapital. I felt it was right for this audience. RaiseCapital is like the funding section on StartupAddict.com, it gives entrepreneurs the ability to find the ever “elusive” startup funding.

According to the 5W Public Relations press release:

Small and medium-sized businesses play a vital role in the American economy accounting for nearly 50% of the nation’s GDP. However, only 13% of these small companies have access to multiple sources of funding leaving the small business segment prone to high failure rates.

Richard Singer, co-founder and CEO of RaiseCapital.com, has the solution for entrepreneurs who are discouraged by an inability to locate funding. As a free online community, RaiseCapital.com provides a forum for entrepreneurs with start-up or existing businesses to display their ideas and capital needs to an array of investors.

Mr. Singer has the following tips to help entrepreneurs connect with funding:

1. Utilize the Internet to post your ideas for venture capitalists to see. Venture capital funding is difficult to secure if you only speak to a small group of people about your idea. By posting on the Web, you are casting your net far and reaching the largest audience possible, thereby increasing your odds of finding capital. Most importantly, it’s free.

2. Study your competition and seek out alternative approaches that will make your business unique. Venture capitalists will likely take notice of your creative idea and support a business where they can expect a substantial return on their investment.

3. Demonstrate the market demand for your product or service. Whether an existing business or a startup, create a beta version of what you plan to produce on a larger scale with financial backing. If investors can see a beta Web site or the product you plan to later mass produce, they will be more comfortable supporting a promising enterprise rather than an abstract idea.

4. Create a detailed business plan outlining what you plan to do once you receive the funding. Account for every expenditure and discuss alternative approaches you will take if the business begins to fail.

5. When posting your idea on the Internet and developing a business plan, explain your previous work experience and how that will translate into your ability to effectively manage a successful business. The most common reason that businesses fail is poor management.

So If your looking for funding and you can’t wait for the peer2peer module on StartupAddict.com funding tab then Raisecapital.com is great place to be.

BizAg - business for sale search engine

Last modified on 2008-05-30 00:38:07 GMT. 2 comments. Top.

BizAg is a vertical search engine startup for businesses up for sale. There are numerous business sites on the web like bizbuysell and businessforsale that allows users to search for businesses based on category and location, but none have attacked the business model from a search engine stand point.

BizAg aggregates all the sale listings of businesses and startups across the web into a centralized place. The marketplace tab at StartupAddict.com is setup as a business exchange (buying and selling startups) but not as comprehensive of a search solution.

This could become a real lucrative solution for bloggers looking to cash-in on their blogs cash flow success. I have several friends that will undoubtedly be posting on BizAg before they get to the end of this post. I did a quick search on “social networks” and got some odd results in the 1 and 2 slot but the results were right on target from #3 on. I definitely give a full thumbs up to rather simple scraper-bot (web-crawler) and a simplistic interface that only users in a post Google world could enjoy. It does appear to only scrap the top 3 business sites on the web but, having the power to obtain instantaneous information on a business for sale is still worth its’ weight in gold.

If you are unfamiliar with vertical search check out John Battelle’sSearchblog

Other coverage:
Mashable
KillerStartups

Top 100 Fastest Growing

Last modified on 2008-05-02 19:21:26 GMT. 2 comments. Top.

The Top 100 fastest growing companies according to Entrepreneur.com. The criteria of these businesses is based on annual sales exceeding $1 million and showing positive job growth measured over a four-year period. The Top 10 are below ranging from self-storage to Goverment IT contracting. The full 100 list is at Entrepreneur.com What is impressed me the most was the staying power of the top 100 startups. By the second year in business 76% had turned to profit and 75% had earned their first million.

* If you think your startup has what is takes the make the 2009 list apply here

1. Simply Self Storage
Self-storage facilities
Industry: Miscellaneous Services
2007 Sales: $109.1 million

2. BlueStar Energy Services
Electricity supplier
Industry: Miscellaneous Services
2007 Sales: $171.5 million

3. Bills.com
Online personal financial information
Industry: Financial Services
2007 Sales: $43.5 million

4. HemCon Medical Technologies Inc.
Medical products
Industry: Health
2007 Sales: $39.5 million

5. Global Water Resources
Water and wastewater utility
Industry: Natural Resources
2007 Sales: $26 million

6. MXenergy
Natural gas and electricity supplier
Industry: Natural Resources
2007 Sales: $703.9 million

7.HealthTrans LLC
Pharmacy benefit-management services
Industry: Business Services
2007 Sales: $182.2 million

8. Litle & Co. LLC
Online payment processor
Industry: Financial Services
2007 Sales: $94.2 million

9. Deep Marine Technology
Subsea services for the offshore oil and gas industries
Industry: Natural Resources
2007 Sales: $55 million

10. SGIS
Government contracting, IT and professional services
Industry: Government Contractors
2007 Sales: $62 million

18 hot new startups

Last modified on 2008-04-22 14:23:06 GMT. -1 comments. Top.

18 hot news startups are confirmed at Under the Radar conference to present on stage in June

33Across - Identifies influential online users
Animoto - Create personalized, professional-quality videos from images and music, offering a new alternative to traditional online photo slideshows
AudioMicro - Stock music and sound effects licensing platform
Aviary -Suite of web-based applications for people who create and a marketplace to sell that content
Dizzywood - A virtual world that allows kids to dress up 3D avatars, play games, explore worlds and meet new friends in a safe environment
ffwd - Organized, multi-platform, video content delivered via a browser, with social network awareness, and predictive recommendations.
GumGum - A licensing and distribution platform for online content
Hollywood Interactive Group - A mass casual mmo based on reality TV concepts and Hollywood stardom.
Jacked - Browser-based “second screen” for TV viewers, which provides synchronized content and a real-time interactive experience that complements what they’re watching on TV
Kosmix - Categorization engine that crawls billions of Web pages in a unique manner to create algo-generated home pages
Loomia - Social recommendations bridging established social networking sites with media websites
Mochi Media - Provides independent game developers with analytics, distribution, tools and monetization while providing advertisers with turnkey opportunities to reach the one in three Internet users who play online games.
MovieSet - Platform that brings behind-the-scenes filmmaking online, giving fans authentic access through its proprietary toolkit for Producers.
Mytopia -Social gaming community for Web, Mobile, Smartphone and TV
PixVerse - Web-based widget virtual worlds that are fun and simple to play from anywhere on the web.

PlayCafe - Online game show network
Sometrics - Social Analytics and Social Ad Platform
uiActive - Take all your contacts from your social networks with you — on your phone!

Top 5 Time Management Techniques

Last modified on 2008-04-19 18:26:59 GMT. 3 comments. Top.

We could all use more time, but there is truly only 24 hours in a day and time management techniques become an essential skill for combating the clock, especially for entrepreneurs. Here are my top 5 time management techniques that enable me to squeeze the most out of a day.

1. Focus rather than multi-task. Studies have shown that tasks take 50% longer to complete during multi-tasking rather than concentrating intently on the task until adequate completion.

2. Prioritize tasks appropriately. Don’t work on #4 on your “to-do” list when #16 and #25 are essential for a deadline. This sounds like common sense but prioritizing what is critical, is an essential ingredient in time management.

3. Monitor where your time goes. Identifying where your time really goes in a work-week verses where you “think” it goes is a must. This will reveal what your distractions are as well as what is consuming your time but producing little productivity.

4. Clean the Clutter. This is the one time management technique I continue to fight with everyday. Out of sight, out of mind works well here, When evaluating a task either “Do it”, “Discard it” or “File it”. This includes your digital assets as well like email, and desktop files. This should also help you perform backups on data more timely because your purging your inbox more.

5. Quiet Time. Believe it or not this is an essential technique to decompress from the daily information overload and noise. A minimum of 15 minutes should be allocated to taking a break, walking, cat nap or just reading personal material. The importance of this technique is release the stress value.

The benefits that you will gain from these techniques will be amazing. You should realize at least one of the following.

- More productivity
- Less ADHD syndrome
- Peace of mind
- Pride of accomplishment

so there it is your top 5 management techniques….take 2 pills and call me in the morning. -Good luck.

Blockbuster buys circuit city for $1.3 billion?

Last modified on 2008-04-14 22:27:17 GMT. -1 comments. Top.

Blockbuster and many others in the traditional movie rental vertical have been under pressure with the digital revolution. But Blockbuster (bbi) buying Circuit city (cc) for $1.3 billion….what could be the underpinnings to such a deal? Apparently, Blockbuster is paying compliments to Apple by copying its’ business model of hardware and content in the living room equals money.

Rumor has it Blockbuster is coming out with a setup box (like we need another one), that would certainly explain the Circuit City purchase. I can see two compelling reasons for this; first CC offers the hardware and manufacturers that would enable such a feat and two CC certainly has the retail outlets and distribution channels. According to ECT (full story there) the purchase represents a 54% premium. The clear and present danger reportedly is coming from BestBuy, Apple and discounter Walmart. The quote for the acquisition has been pulled from ecommercetimes below (I took the liberty to highlight the business jargon used for these type of M&As):

“Our proposal offers Circuit City a significant premium to its existing stock price and creates a game-changing retail concept with a sustainable competitive advantage,” Keyes said. “We believe the combination will result in a compelling consumer proposition that will drive significant revenue and margin enhancements as well as cost synergies.”

For those of you not versed in M&A business jargon I will attempt to translate:

“In case you haven’t been keeping score, we have been getting our A*S handed to us by Netflix, you got a better idea?”

For those of you wondering why this made StartupAddict Musings the answer is simple….disruptive technologies and bold business models like Netflix (NFLX) cause traditional companies like Blockbuster to make long-term strategies to survive and that is the business DNA startupaddicts are made of.

Entrepreneurial Thoughts

Last modified on 2008-03-26 23:21:00 GMT. 1 comment. Top.

I came across the center of entrepreneurship BYU Marriott School and found a tremendous resource for entrepreneurs. I took the liberty to answer the first 10 thoughts on the list of entrepreneurial thoughts with my two cents. I felt compelled to answer these great thoughts. For a the complete itemized list (26 total) of entrepreneurial thoughts check out the BYU | Marriott School “Center of Entrepreneurship”. You will also find other great resources like Idea Evaluation, Common mistakes, Starting costs, 5 Stages of Growth etc…Enjoy.

1. It has to be a business that gives you an emotional high.

Startups are like marriages, they are a tremendous commitment and you have to be willing to see it through to the end. If you just “like” the business and not “love” it, don’t bother. A failure that was “loved” is better than a success that was “liked”.

2. Try not to go into anything that is labor, inventory, or accounts receivable intensive.

An entrepreneur’s time is extremely valuable, spent being the puppeteer of so many business systems from accounting to marketing to operations. The last thing you want to do is sacrifice your precious time doing administrative functions. Here is a quick solution to this great entrepreneurial thought: If your startup demands labor then outsource, if it demands inventory then drop-shop, if accounts receivable is a must then streamline your A/R systems and personnel.

3. Have independent market research done on feasibility of your ideas.

Due Diligence and idea research is one thing and one thing only —CHEAP! So don’t skimp on the market research and save yourself the future hassle. I tend to follow the 10:2:1 ratio with new startup ideas. I nurture 10 good ideas with market research and end up with 2 that are worthy of further development. Out of the 2 ideas left, one almost always proves to be superior and quite possibly becoming my next startup.

4. Don’t think someone is waiting to steal your idea, it’s paranoia.

You can’t steal an idea, only the methodology of executing an idea or a specific use of that idea. This is an important point because startups are based on a developed idea but the execution is what determines success not the idea itself. If someone said they had an idea for an Internet auction site, do you think they are nervous about that idea being stolen? Put yourself “out there” or you will end up “nowhere”

5. Don’t get started on a real business until you have someone (spouse, family member) who will listen to your dreams, sympathize with your failures and applaud your successes.

Sounding boards are critical in to startup success. I do this long before I commit to market research, if you can’t convince your own blood or friends it is a good idea, who are you kidding? Make sure you don’t “hard sell” your concept….do a “soft sell” and listen to their feedback. This is like a mini and free focus group before your idea has ever left your skull.

6. Never involve yourself in any service or product that requires a consumer attitude change.

This is a brilliant philosophy…it is the entrepreneur that needs to roll with the consumer’s punches not the other way around. Don’t end up like the music studios in a changing digital environment. Underestimating the consumer’s tenacity and crowd sourcing ability will be an entrepreneur’s downfall.

7. Don’t invest your money or time in home run schemes—invest in what you like and know.

The book I’m writing on the daily life of a StartupAddict dedicates a chapter to this concept. Everyone of us has our very own toolbox of skills, education and experiences in life. If you know a tremendous amount about real estate don’t try to startup a pet store. This sounds like blatant common sense, but sometimes we all need to be reminded of just that.

8. Find a lifelong mentor as soon as possible. Have him continually play devil’s advocate with all of your projects.

I have multiple mentors in this game called life, but I also tend to be very industry agnostic when it comes to starting companies (almost to the point of negating my answer to the previous thought #7). Because I am so transient with industries I have not always been fortunate enough to have an industry specific mentor handy. So I developed a technique of utilizing only the friends, family and associates I know play devil’s advocate role. This is a great substitution. This is also why I created the advisors section in “StartupCentral” at StartupAddict.com so I could mitigate this problem for future entrepreneurs.

9. Make sure you are not just buying yourself a job. Have an exit point or harvest plan to cash out.

This is a safe mind-set to have going into any new business or startup. If you want to build a cash-flow business and never sell, know that going in. If you want to build a company and sell for 10 times annual earnings, make sure you know that. This is critical to how you treat your business on a daily level.

10. Do self-awareness training. Find out who you are.

As far as we know (us mortals) we only get one go at this life. Make sure you don’t merely plod along and just get by. Find out who you are, your purpose and then Dream Big and Be Great.

The 8th Habit

Last modified on 2008-03-25 18:13:01 GMT. 1 comment. Top.

If you get a chance to read the 8th habit or at least listen to the audio book by Stephen Covey (author of 7 highly effective habits of successful people) it is well worth it. I’m a little late on getting the book, but it was in the bargain bin at Barnes the other day and couldn’t help myself. Mr. Covey makes some very interesting points on the difference between workers in the 20th century verses the worker of the 21st century.

The old century was based on the industrial age where production and efficiency was paramount. Today the Knowledge worker is among us and needs to be treated less like an expense (industrial age accounting system) and more like an asset. The modern day worker is more entrepreneurial than the 20th century industrial age worker, yet current employers have not adapted to that change. Most employees feel they are restricted or wasting their time in their current work environment.

Solutions need to come from the employer to let the knowledge worker be more entrepreneurial and base a reward system on company improvement and common goals. I think the churn rate at businesses and the overall work culture would grow dramtaically by implementing this ideology. In the process, the modern worker would feel empowered and satisfy the entrepreneirual gene that is in all of us. The employer just needs to loosen the leash a bit. Some of the most successful companies have implemented flavors of this technique.

It has alway been my philosophy with any businesses I am involved with to give employees and partners enough rope to either perform or hang themselves.

How to turn around a failing business

Last modified on 2008-02-25 02:14:38 GMT. -1 comments. Top.

A business acquaintance of mine recently asked for advice to a question every entrepreneur dreads…How do I turn around my failing business? First off, there is no panacea for a failing business and every situation is unique even with best management practices, regardless of industry type.

I thought long and hard before giving my answer to my friend (which is contrary to my usual verbose knee-jerk reactions) and I finally told him about an exercise I learned of that was more in tune with psychology than business. I told him to write down everything he possibly could about his business, what the strengths and weaknesses are, the history of accomplishments the aspirations for the future and so on. After he answered the questions I told him to construct a boiler plate questionnaire of 20-30 questions that he had already provided answers for. I then told him to give the questionnaire to stakeholders of his business such as customers, vendors, shareholders, even competitors (the old adage keep your friends close but your enemies closer). He was shocked at the results that were returned.

The lesson is one of “know thyself”. The first time I learned of it was not in a business application, but a personal test. The goal was to answer a questionnaire regarding my personal characteristics and traits and then let my friends and family answer the same questionnaire that I answered about myself. I was absolutely astonished to realize the stark differences between what I thought of myself and what other people thought of me. Some of my perceived weaknesses were viewed as strengths in the eyes of my friends and family and vice versa. Sometimes like my friend you can’t see the forest from the trees when your in the trenches of day to day operations of a business. We become blind to our business’s faults. Seeing a fresh perspective from an outside source of what really fuels your business and what truly ails your business is the key. There is no better litmus test on how your business is doing or could be doing then hearing it first hand from a reliable but close source.

Don’t always pretend to have all the answers…it’s better to ask the question and find the answer. Then and only then can you devise a strategy appropriate enough to turn around your failing business.

10 Deadly sins of Startups.

Last modified on 2008-02-09 03:29:43 GMT. -1 comments. Top.

I was cruising through the various documents available at Scribd ( previous coverage here) and ran across the 10 Deadly sins of Startups that entrepreneurs encounter by Bill Baloglu. The document is well drafted with elbow grease experience and the typical red flags of the startup journey.

** Use the slider bar at the top of the document to zoom in **