Planning, Startups, Stories

Can You Really Start a Business in Three Weeks?

Yes, you can. Maybe not all businesses. Maybe not any business. Some businesses, though, can start in three weeks. My first business started the day a former client called and asked my to do a market study in Venezuela. That changed things from one day to the next.

That's a true story. If you're curious, I posted that one a few months ago on this blog as The First Day of a New Business.  That's one example. There are millions.

There are 21 million companies in the United States without employees. I wonder how many of them started up in 3 weeks or less.

A 2006 study sponsored by Wells Fargo and Conducted by Gallup found that the average startup cost was about $10,000. I wonder how many of those started in three weeks or less.

It would be easier to count the businesses that can't start in three weeks, because there are a lot fewer of them.

• You can't do it in three weeks if you have to raise significant money to start with. I have indications that angel investors financed about 60,000 new businesses in the United States last year, and venture capital investors are doing about 2,500 deals per year. That's a very fine stratum at the top of the new business picture, a small percentage of the 800,000 or so new businesses started in an average year.
• You can't do it if you have to wait longer than three weeks for a bank loan. Some bank loans can take less than three weeks. That's more likely if you're borrowing off an established and solid asset, like your house equity (if it is solid and established, and not a victim of the sub-prime mess).
• You can't do it in three weeks if you have to establish a location, build a team from scratch, manage prototypes, prove your viability. All those are among other reasons.

Even in those cases, however, you can play with the definitions. You can call it starting in three weeks if you get the team together, the basic idea settled, the first legal steps taken, and you start the search for the location and start the search for funding.

Why do I care? That's a reasonable question. Yesterday Sabrina Parsons and I finished our compete draft of a book called "Start Your Business in Three Weeks," to be published by Entrepreneur Press next fall.

That was the second book draft I've sent to Entrepreneur in two months, and the last for a long time. Of course I/we didn't write them that fast, they were both a long time coming. That's what happens, I guess, when you name a new CEO for a company and task its long-time president with blogging writing, teaching, and speaking.

Using the Blog Platform for Writing a Book

A week or so ago I finished a complete non-fiction book draft using a password-protected blog as the writing platform. I used my TypePad account, but it could have just as easily been in WordPress. I don't know the other platforms that well.

I'd cite the blog for you and reference it, but it's password protected until the publisher, Entrepreneur Press, decides whether or not we should just open it up. That's a marketing question, theirs to decide, not mine.

The draft is about 80,000 words for The Plan-As-You-Go Business Plan, to be published by Entrepreneur Press and due out next fall.

Why? What were the pros and cons? The draft is done now, so I've been coming back up for air, thinking about it.

1. The major advantage was access to the draft, to read, revise, and write more, from any computer with a network connection. I've been doing a lot of traveling lately, so that was important.
2. I didn't have to keep track of which copy was the latest, going through the hassle of not overwriting my work as I transferred Word *.doc files from one computer to another. The latest was always posted there.
3. I found a way to make the structure work. The book is divided into six sections, each of which has 5-15 chapters. I made sections and chapters categories in the blog. It was easy to move things from classification to classification, as I changed my mind. (I do write following an outline, but as I write, the outline changes.)
4. It was easy to order the appearance of the chapters by managing the dates posted. TypePad gave me the option of having the oldest post appear first, and then the rest in date order from oldest to newest, which was easy to deal with. Between the posting date and the categories, structure was easy to see and manage. Of course you realize you don't actually post in order or deal with real dates posted; you set the date, artificially, with each post.
5. I was able to back up frequently during the process using TypePad's export blog feature. I saved those exports just in case of disaster.
6. I used amazon.com's S3 facility to save the illustrations in one place and refer to them uniformly as I did the draft.

The biggest disadvantage was having to get the whole thing into Microsoft Word, and printed up (the manuscript was 400 pages) to send to the publisher. I had somebody to help with that. It took her two full days of work.

Drawing an Audience, The Old-Fashioned Way

This was in our local paper, the Eugene Register Guard, "from news service reports:"

When Dan Roam wants to make a point in business meetings, he doesn't use Excel or give PowerPoint presentations. He uses paper.

In his recently published book, "The Back of the Napkin," Roam gives tips on how to develop ideas and solve problems with pictures to captivate colleagues, as well as visually capturing those "Aha" moments through sketches. 

The Back of the Napkin: Solving Problems and Selling Ideas with Pictures by Dan Roam Read more about this book...

"I started to notice in business meetings that when I would draw on a piece of paper or white board, people would pay an extraordinary amount of attention," said Roam, who owns a managing and consulting firm [sic]. "It would be like bringing magic into the room."

Roam said even the simplest illustrations -- circles, boxes, stick figures -- are great tools for developing concepts intuitively. "This is something everyone knows how to do, skills we developed in kindergarten, but nobody told us we could use in business," he said.

So I like that tip. By the way, if you have a tablet computer, you can have the best of both ways, with a PowerPoint presentation and the ability to draw live sketches as part of the presentation.

Kindling on the Beach

So my Kindle traveled with me this time, for the first time ever. This was a business trip to Miami, two flights out, two flights back. And yes, there were some off moments, which you can see in the picture. That's not a stock picture, that's my Kindle, in my hands, and those are my feet. So I wasn't working all the time.

The Kindle is the new Amazon ebook reader, released in early December.

The convenience of wireless is fabulous, and the view of the screen is just fine, I'm liking it a lot.

I can't figure out why it always looks bigger in pictures than it does in real life. It's really only about the size of a DVD cover. It's scary to take it to the beach, because it has moving parts and buttons that wouldn't like sand. However, for the picture here, I was very careful. And here you see it again, it looks much larger in the picture than in real life.

I had a very useful comment to my last Kindle post, to the effect that I wouldn't have to turn it off during takeoff and landing. Meanwhile, however, back in the real world, I did. It's against the law to disobey the flight attendants on a commercial airplane. So, when they said "anything that has an off and on switch," I turned it off.

I wish there were a backlighting option. One thing I think people assume about the Kindle is that you can read it in the dark. You can't. This is probably related to the supposedly excellent battery life, as in days, not hours. They say seven days worth of battery if you keep the wireless off. But you can't see it in the dark. And I'm going to test more carefully, maybe I actually left the switch in the wrong position, but I'm getting way less battery life than that.

10 Tips from Starbucks Founder

Thanks to Bill Brelsford of Small Business Building Blocks for this summary of advice from Howard Behar of Starbucks in his book It's Not About the Coffee.

Bill summarizes 10 points from the author:

1. Wear One Hat - the importance of knowing who you are and just as importantly, who you are not.

2. Do It Because It's Right, Not Because It's Right for Your Resume - the familiar do things for the right reasons theme.

3. The Person Who Sweeps the Floor Should Choose the Broom - Howard addresses one of my pet peeves about management - people are not assets, they are human beings. Do give them rules, give them room for independent thinking.

4. Care Like You Really Mean It - it's the only way to build trust.

5. The Walls Talk - it takes time and effort to listen to what is being said and not said.

6. Only The Truth Sounds Like The Truth - the importance of responsibility and accountability.

7. Think Like a Person of Action, and Act Like a Person of Thought - on the importance of finding the balance between passion, purpose, persistence, and action.

8. We Are Human Beings First - You will face challenges, remember to put people first.

9. The Big Noise and the Still, Small Voice - probably my favorite part of the book. Our culture is impressed with the big, noisy, leader. Remember that leaders are just humans, and the quiet, thoughtful leader can be every bit as effective as the rock star.

10. Say Yes, the Most Powerful Word in the World - learn to say "yes" and open the door to big dreams and goals.

I gather the book is an excellent book, but in the meantime I appreciate the list that Bill made, which looks and feels like a good summary.

Seth Godin's New Book

Anne Handley has a very timely interview with Seth Godin on Marketing Profs Daily Fix late last week, along with a good summary of Meatball Sundae, his latest book. I read the book on a long flight late last week; great stuff.

Anne does a very nice summary:

In other words, the new tools might be irresistible. But they don't work as well for boring meatball brands like Cheerios, Ford trucks, Barbie dolls, or Budweiser. When Anheuser-Busch spends $40 million on an online network called BudTV, that's a meatball sundae. It leads to no new Bud drinkers, just a bad case of indigestion, Seth says.

The book is built around Seth's clear style and logical thinking about what he's calling the fourth revolution, and a list of 14 trends that set the tone for new marketing into the future. More of Anne's summary:

Meatball Sundae, according to its publishers, is a guide to the 14 trends no marketer can afford to ignore. It explains what to do about the increasing power of stories, not facts; about shorter and shorter attention spans; and about the new math that says five thousand people who want to hear your message are more valuable than five million who don't.

Anne follows that with a quick interview with Seth, in which he presents a much better view of the book than anybody else.

And I have to apologize, because Anne's post is announcing a virtual seminar with Seth Godin sponsored by Marketing Profs Daily Fix, which happened last Thursday. I was traveling, and with the holiday, missed it.

And that's not so bad, though, because Seth is promoting a free seminar with Seth Godin for January 23. It's about this book, Meatball Sundae.

Plan-as-you-go Business Planning

As we finish up 2007 and roll into 2008 I am certain it is time to adapt a new kind of business planning, which I want to call "plan-as-you-go" business planning. This is intended to bring the idea of the business plan up to date with the kind of flexibility and power we have in the tools we use in business everywhere, while focusing on the real power of planning, meaning management and tracking and accountability, and easing up on the form to make sure that form follows function. For convenience, let's call it PAYG. The plan-as-you-go business plan is PAYG planning. 

And I’m very happy to share, with this column, that I’ve started on a book called “The Plan-as-you-go Business Plan,” due out later this year, to be published by Entrepreneur Press. That’s an early cover design shown here. 

What's Different?

How is the PAYG plan different from the standard business plan? Good question. Let's get into some specifics:

1. It's a process, not just a plan. Every PAYG plan has a review schedule built in, from the beginning. It sets the dates and participants in the future review meetings, taking 60-90 minutes once a month and 2-3 hours once per quarter.  and PAYG planning is about process: not just the plan, but the regular review and management of the plan.

2. Form follows function. The PAYG plan is not necessarily the same kind of formal business plan document you did in business school or read about all over. It doesn't necessarily follow a recipe. Every PAYG plan is unique. It might generate a formal document at some point, or over and over again actually at different points in company history, but until you need the formal plan document to show somebody it lives on your computer. You pull from the plan to make a pitch presentation or elevator speech or summary memo or full detailed business plan document, as required for business purpose. It's the source of all of these, the key thinking including strategy and metrics and dates and deadlines, without having a specifically defined form.

3. It assumes and manages change. The PAYG plan is about navigation, not just a static map. It assumes that assumptions will change. That's why it builds the review schedule into it, and in keeping with that idea, assumptions must always be visible, on top, where they can be reviewed. Unlike the misunderstood formal business plan, the PAYG plan is a way to keep your view of the long term goals and directions while also managing the short-term surprises. 

Now I recognize that you could read this list and say "but that's the same as good planning has been for years, it's not so new and different." And I'd say "that's right, you're getting it." What's most important about PAYG planning is that people in the real world, startups and growing companies alike, can actually use it. It gets people out of the silly talk about how a business plan isn't useful because they misunderstand how a business plan is supposed to be used.

4. Accountability. Plan-as-you-go planning develops accountability in the process, as a matter of metrics, and tracking. It is important that accountability be a matter of collaboration, and not the crystal ball and chain.

What's Essential

1. Start with the review schedule. If you don't have a plan review schedule, you don't have PAYG planning. You might have a plan, but it's not PAYG planning. Set the dates from the very beginning. As you develop the plan, you keep the people involved aware of the touch points, when and how and who you're going to track.

2. Develop useful metrics. PAYG planning is about actually managing, not just planning into thin air. The main metrics are money, and the most important is cash flow, but look for metrics that involve the team. Calls, presentations, visitors, inquiries, average time of calls, downloads, whatever. Ideally, everybody on the team deserves metrics.

3. Identify the assumptions. Effective PAYG planning keeps the assumptions on top, where you can revisit them with every review meeting. We assume things change and the planning is about navigation, not just a static map. This is how you keep your plan alive and active. 

4. Every plan has a heart and flesh and bones. The heart is strategy, market need, differentiation, and focus. This is as true with PAYG planning as with traditional plans. The flesh and bones are just as important, and in PAYG planning that’s metrics, milestones, tasks, dates, deadlines, and responsibility assignments, and, most important, cash flow planning. 

Important Principles of PAYG Planning

1. Start anywhere. Get going. The plan is a matter of interlocking blocks, so some people start with a numbers task, like a sales forecast, and others start conceptually, with a vision or a strategy or focus. Just get started. Don’t wait until your plan is finished, get going. Start today and start using it tomorrow. 

2. All business plans are wrong – but still vital. It’s a matter of humanity, you are predicting the future, you’ll be wrong, but you set down tracks so you can follow up and revise without losing sight of the long-term goals and directions. 

3. Good business plans are never done. My company’s business plan started in the late 1980s and it’s still a work in progress. If your plan is finished, your company is finished. Instead, you revise as needed, as in steering, navigation, and walking. The core of the plan is the collection of heart and flesh and bones, it’s content, thinking, and specifics; from that you spin out a document or presentation or elevator speech as needed, and when needed. 

4. Form follows function. Do only as much as you need to run your company, to manage, to build strategy and follow-up and long-term goals and directions. If you don’t need to create a formal plan, don’t; keep it on your computer. 

5. Keep it alive, always, and spin the output as needed. Don’t ever let your plan go static. Keep it on top of things, active, and alive, not forgotten in a drawer. 

6. Planning is worth the implementation it causes. You measure a plan by results. It’s as good as the decisions it guides.

6 Traits of Sticky Ideas

I've recommended the book Made to Stick by Chip and Dan Heath before, on this blog. It's an excellent book. The McKinsey Quarterly has a useful and interesting interview with Chip Heath in the latest issue (registration required, but free).

Chip is the Heath brother who teaches organizational behavior at the Stanford Graduate School of Business.

The interview has a great summary of the 6 basic traits of sticky ideas, the main content of the book. This is in no way a substitute for reading the whole book -- very interesting to read, very entertaining, as well as important -- but I think it will be useful to me in the future as a quick summary reminder of the 6 factors:

Presentation Zen: the Book

If ever there were a message the business world needs, it's better presentations, please. Do a quick Web search and you'll find ample writing by several smart people -- you can start with Seth Godin and Guy Kawasaki -- on how to do presentations better than the "death by PowerPoint" style, also known as boring bullet points.

One of the most visible and most vocal people on this theme is Garr Reynolds, whose blog is Presentation Zen, and whose new book is also Presentation Zen, now available for pre-ordering on Amazon.com.

I'm really looking forward to getting this book. Here I am recommending it before I've even read it. I feel confident making that recommendation because I've been reading that blog and I feel like I understand what  the author is saying.

If you're ever doing slide presentations with PowerPoint or Keynote,  and you haven't had a chance to look  at and think about presentation techniques, then  do yourself and your audience a favor. Take a look at some of these blog posts,  consider this book.

Watching the Kindle

So response to the Kindle is heating up. I ordered one and discovered they're back ordered, not promising to deliver before Christmas. I've seen a thoughtful post suggesting that Amazon will regret not making it a more open system. And reviews on Amazon are only lukewarm.

The delay is okay with me, it wasn't a gift, I just want it. I rationalize that I'll be able to blog about it, but that's just MBA rationalization, I ordered it because I want it. I did that in June with the iPhone, paid the $600 to get it the first day, and I don't regret it.

But you realize of course that I will have to tell you about it when I finally get it. I'm looking forward to it. In fact, I already didn't order a hard copy book from Amazon today, because I see it's available on the Kindle, and I want to wait for the Kindle version.

I've been an ebook fan long before the Amazon Kindle. I'm proud of that. I like the idea of an ebook reader. I bought the old Rocket ebook reader five years ago (or so) and I was glad I did. Before that I bought my first PDA -- maybe seven years ago -- for its ebook capabilities, and I actually read several full-length novels on it before I went on to something else.

In the interest of full disclosure, that Rocket ebook was a gift for a teenage daughter with a reading addiction, at the rate of two or three books a week. It was in part a defense against "Dad, can we go to Borders?"

"Download it dear, download it."

The reception of the Rocket ebook reader was underwhelming. I thought my daughter was possibly the only user, so I wasn't surprised when the content stopped coming, but I just did a Web search and found somebody else who owned a Rocket ebook reader ... and liked it:

I owned the first Rocket Reader(NuvoMedia) in Grad school and loved it, absolutely loved it. I found it versatile (I could also sink my own documents to it, as well as free ebooks I found at Project Gutenberg. I could add notes and bookmarks). I read my first Dan Brown book for under two dollars, Angels and Demons, before he was discovered by the world.

That seems odd because apparently the Rocket was not a success. They stayed away in droves. I thought my daughter was the only user, so I was glad to see Rebecca's post, but that doesn't make it mainstream (sorry, Rebecca, but then you do call your blog "the eclectic musings of an oddball").

And yet, times change, technology marches on, and here comes Amazon with a new thing. The big gimmick is that you're not tied to the computer, you can download the books from anywhere that has a cell connection.

Meanwhile, David Weinberger suggests the new Amazon Kindle may be "a textbook example of how the strengths of closed platforms can quickly turn into a weakness." 

One thing Amazon has going for it is that Kindle ebooks are cheaper than real bound paper books. Just a bit cheaper, unfortunately. They certainly aren't taking Seth Godin's recommendation for really disruptive marketing, which he titled You Won't Find Me on Amazon's New Book Reader.  He makes a good point, but actually, I think I will find him there.

Meanwhile, on the Harvard Business Online site, David Weinberger says Kindle is going to fail because it's a closed system.

Amazon's Kindle e-book may turn out to be a textbook. A textbook example, that is, of how the strengths of closed platforms can quickly turn into a weakness. From a product perspective, Kindle addresses every key weakness of its predecessors ...

But Kindle operates in a closed universe, and that's why it probably won't succeed in the long term as currently constructed.

Interesting coincidence, he finishes that piece by asking "How about iTunes? Where do you see openness encroaching next?" Meanwhile, I've just this week switched my music buying patterns from iTunes, which annoys me by controlling how many computers I listen to purchased music on, to Amazon, which doesn't. That's right, Amazon is the open system vendor that switched me from iTunes. So it goes full circle.