Successful Startup 101: July 2014

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The 5th issue of Successful Startup 101, a magazine for budding entrepreneurs, startup founders and small business owners that covers business planning, strategy, management, accounting, finance, sales and marketing. In this month's issue: The Birth of the Startup Excubator; Do You Have What It Takes to Start Your Own Business; Entrepreneurs: Here Are 7 Ways to Make the Most of Your Downtime; The Trend that Is Changing Sales; 9 Ways To Create Time, Space, and Stillness For Meaningful Work; Self-Employment Taxes Demystified: Can You Lower Them for 2014; Operating A Business in the Age of the Brand Experience; Why Startups Hire Their Own Lawyers; How We Grew Our SAAS Startups MRR from 0 to over $2k in Under One Month; For Employer and Employees Alike, Automated Payroll is a Win-Win; 9 Ways to Make A Million.

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  • The Know-How You Need to Lead You on Your Path to Business Success Volume 1 , Issue 6

    FIVE STARTUP LESSONS FOR FASTGROWING COMPANIES

    FEATURED SPOTLIGHT: STARTUPMANAGEMENT SUCCESS

    THE BIRTH OF THE STARTUP EXCUBATOR

  • Do You Have What It Takes to Start Your Own Business?

    Entrepreneurs: Here Are 7 Ways to Makethe Most of Your Downtime

    The Trend that is Changing Sales

    The Birth of the Startup Excubator

    Managers: Dont Treat All Employees the Same Way

    The Guide to Running a Small Business:8 Things Youll Never Want to Forget

    Five Reasons Why Small Businesses Fail

    Self-Employment Taxes Demystified:Can You Lower Them for 2014?

    Symptoms of Customer AcquisitionProcrastination Syndrome

    9 Ways To Create Time, Space, andStillness For Meaningful Work

  • 10 Common Startup Flaws Leadingto an Early Demise

    Five Startup Lessons for Fast-GrowingCompanies

    These 8 Business Beliefs AreKillingYour Startup

    Operating A Business in the Age ofthe Brand Experience

    How We Grew Our SAAS Startups MRR from 0 to over $2k in Under One Month

    9 Ways to Make A Million

    Neats Chris Barbier Talks about theFuture of Small Business Solutions

    For Employer and Employees Alike,Automated Payroll is a Win-Win

    Why Startups Hire Their Own Lawyers

    Getting Ahead: Dont Forget to Feed Your Spirit

  • SUBSCRIBE TOSuccessfulStartup101 Magazine

    TODAYSUBSCRIBE

  • SuccessfulStartup101The Know-How You Need to Lead You On Your Path To Business Success

  • Over the last five years, my firm Red Rocket Ventures has consulted or mentored more than 500 startups -- nearly all of them suffering from the same problem. They are typically so focused on building their product, they dont raise enough capital to cover essential sales and marketing activities that will allow them to better attract additional venture capital down the road. As a result, many startups run out of money soon after launch, stalling out before they reasonably had a fighting chance.

    The root of the problem really comes down to better

    education. Entrepreneurs need to learn early on that you cant launch a startup unless you have raised enough capital for both your product development and your initial sales and marketing activities. They must learn the essentials that all investors look for: rapid user growth, proven customer acquisition metrics from previously tested sales and marketing channels and knowing the best, most cost-effective sales and marketing tactics to stretch their limited budgets.

    By focusing on this education problem, I was originally thinking about building a startup curriculum in a university-style setting. But, given

    By George Deeb

    The Birth of the Startup Excubator

  • how quickly technologies and marketing tactics are evolving, I was worried about having the curriculum go stale the minute it was finished. Then, I thought some of this could be taught through startup incubator or accelerator programs, but that was only available to the small percentage of applicants that get accepted and only for the short period of time they were in the program.

    I wanted a solution that would appeal to all companies that had the interest and the resources; a program that would grow with them through all stages of their growth -- from freshman year through senior year, using the education analogy.

    I realized it was the agencies who had their finger on the pulse of all the rapid changes in technologies and digital marketing tactics. But, not the large agencies that are jacks-of-all-trades and masters of none. The boutique, niche agencies are the deep domain experts in their particular field, for example, search engines or social media.

    And, more importantly, these boutique agencies that are smaller in size are also entrepreneurial and have first-hand knowledge of how to stretch startup marketing pennies into revenue dollars. By rolling up these services into a one-stop shop, managed by one person from the team, the startup excubator model was born in Chicago with the launch of Ensemble in August 2013, of which Red Rocket is a member company.

    But, to really appeal to the startup community, we understood we needed a more attractive pricing plan that was more affordable to startups -- one where 20 to 40 percent discounts would apply for bundling your services needs into one digital services suite of expert vendors. In this model, the excubator would also consider taking an equity position in these businesses, so it actually had a vested interest to help these businesses succeed, as partners with entrepreneurs over the long term. This evolves the excubator members revenue models from the normal short term fee driven model to a more logical long term venture capital return model, which if done correctly, should improve the a typical startups odds of success from 10 percent to closer to 30 percent in the process.

    It is too early to tell if this excubator model will work or not. A current flaw in the model is it still requires the startups to go cash out-of-pocket, even with deeply discounted rates, which they may or may not have the money to pay for. In a perfect world, an excubator model would have raised its own venture fund, or would partner with existing seed-stage venture funds, to help fund these early stage entrepreneurs who may have a great idea, but not the capital to afford the collective services which are required to launch the startup with maximum odds for success.

    If excubators have done anything, they have creatively brainstormed how to help more startups over the long run.

    George Deeb is the Managing Partner at Red Rocket Ventures, a growth consulting, advisory and executive staffing firm based in Chicago. Red Rocket is also a founding member of Ensemble, an all-star powered Digital Services Suite. You can follow us on Twitter at @georgedeeb, @RedRocketVC and @EnsembleHQ.

    About the Author:

  • What qualities do successful small business owners have in common? A new survey by Deluxe Corp. sought to find out by asking entrepreneurs about their history, attitudes and characteristics that led to business success. How do you measure up? According to Deluxe:

    Smallbusinessownersareoptimists. Youll deal with lots of setbacks and obstacles in your road to business success, so you need to have a positive outlook. In the Deluxe survey, a whopping 86 percent of respondents believe they can do anything they set their minds to.

    Smallbusinessownersarecomfortablewithfailure. The road to business success is paved with failures, but thats OK for entrepreneurs in the study. More than three-fourths (77 percent) say they would rather learn from failure than never try at all.

    Smallbusinessownerskeepitallinthefamily. Having family members who have run businesses is a common thread among successful small business owners. Whether its learning the ropes of business success at an early age or simply being exposed

    Do You Have What It Takes to Start Your Own Business?By Rieva Lesonsky

    More than half

    (54 percent) of

    entrepreneurs in

    the survey say

    they started their

    companies because

    they wanted to

    work for themselves

    instead of having a

    boss. A majority (89

    percent) described

    themselves as

    leaders.

  • to the realities of entrepreneurship that makes the difference, more than three-fourths (76 percent) of small business owners Deluxe polled have a family member who owned a small business.

    Smallbusinessownersliketobeincharge. More than half (54 percent) of entrepreneurs in the survey say they started their companies because they wanted to work for themselves instead of having a boss. A majority (89 percent) described themselves as leaders.

    Smallbusinessownersliketogetthingsdone. You may be dreaming about starting a business, but for business success, you need to take the next step. Seventy-eight percent of entrepreneurs in the survey describe themselves as doers and 80 percent say theyre practical (80 percent).

    Of course, not all small business owners are the same, and there are many reasons to start a business. Deluxe found the small business owners in the study fell into one of seven categories:

    1. All Heart: These entrepreneurs started a business to do

    what they love and share it with others.

    2. Encore Career: These entrepreneurs are older, entering a second phase of their careers, and took a risk with starting their own businesses.

    3. Passionately Confident: These risk-takers are born business owners who believe in choosing their own paths in life.

    4. All in the Family: Traditional types, these entrepreneurs inherited the family business.

    5. My Way: These entrepreneurs were motivated by taking back control of their time. They started their companies to gain control over their schedules and hours. (Theyre more likely to be women).

    6. Mastering the Niche: What we think of as the classic entrepreneur, these business owners saw an opportunity and wanted to capitalize on it.

    7. Boss-me-not: These former business professionals left their for-profit, corporate jobs because they wanted to be their own bosses.

    Isnt it good to know that, whichever category you fall into, you can make a go of your business?

    AboutRievaLesonsky

    Rieva Lesonsky is CEO of GrowBiz Media, a media and custom content company focusing on small business and entrepreneurship. Email Rieva at rieva@smallbizdaily.com, follow her on Google+ and Twitter @Rieva, and visit her website SmallBizDaily.com to get the scoop on business trends and sign up for Rievas free TrendCast reports.

  • Focus on slivers of time where you can cut back. For example, rather than scheduling a one hour meeting to chat with your team, cut out the u so its 30 minutes or less.

    Entrepreneurs:Here Are 7 Ways

    to Make theMost of Your

    Downtime

    By Ilya Pozin

  • As an entrepreneur or startup founder, being stretched thin comes with the territory. Juggling a busy schedule may be second nature for you, but are you really using your time wisely?

    As the founder of two startups, Ive grown so accustomed to being busy that I dont think I function as well without a lot on my plate. But its taken years of practice for me to ne-tune my time management to ensure Im not just getting things done but also maximizing every spare minute. This is especially important when it comes to your downtimeeven if its just 15 minutes per day.

    Here are seven things to accomplish while making the best use of every spare minute you have:

    1. Reprogram your scheduleUsing your brief moment of downtime to work on scheduling could save you a lot of time in the future. How much time are you allocating toward meetings, projects, or anything else youre encountering on a daily basis?

    Focus on slivers of time where you can cut back. For example, rather than scheduling a one hour meeting to chat with your team, cut out the u so its 30 minutes or less.

    2. BrainstormingIdea generation is crucial to every startup founder, but it

    can be challenging to nd time in your

    busy schedule. If you have 30 minutes of quiet time in the

    morning, brainstorm some ways to improve your business or just let your creativity ow for a while. Or, if

    your team is having a slow work day, invite them to the meeting room and divide them into teams for an

    impromptu brainstorming session. Give the team with the best new ideas a reward, like ex time or a day to work from home.

    3. StrategizingEvery minute counts when it comes to strategizing ways to grow your business. This could mean researching new ways to reach your customer base via marketing strategies or simply improving your website.

    To put your spare time strategizing to better use, consider bringing in your business partner or trusted employee to help you further your thinking.

    4. Evaluate your teamWhen was the last time you spent time evaluating the way your team functions? Go beyond considering their eciency and whether theyre thoroughly engaged. Instead, hone in on their strengths and weaknesses and gure out ways for them to improve. You may even want to pull your employees aside for a one-on-one to individually to address any issues and gain feedback.

    5. Rework internal processesIs your business running as smoothly as you think it is? Take time to gure out ways to improve your internal processes and boost company-wide eciency.

    For example, you may nd a software program that can automate menial tasks. Or maybe youre struggling internally with the management and delegation of your teams. Consider restructuring your organization to remove hierarchy and function in a new manner.

    6. Uninterrupted general focusBalancing a busy schedule often means struggling to nd time to sit down and truly focus on something for a long period of time. Take advantage of every spare moment of down time to achieve uninterrupted focus on a pressing matter, even if its just organizing your inbox.

    7. Catch up on readingBelieve it or not, reading is a great way to make use of your time. Make time to read up on the latest industry news, check out what your competitors are doing, or even nish up that book thats been gathering dust on your shelf. Feeding your mind also enhances your creativity and productivity overall.

    Use your spare moments of relief from a busy schedule as eectively as possible to help your business.

    How do you use your downtime?

    About the Author

    Ilya Pozin is an entrepreneur, writer and investor. He is the founder of Open Me, a social greeting card company, and Ciplex, a digital marketing agency. Hes a columnist on entrepreneurship and marketing.

  • As an entrepreneur or startup founder, being stretched thin comes with the territory. Juggling a busy schedule may be second nature for you, but are you really using your time wisely?

    As the founder of two startups, Ive grown so accustomed to being busy that I dont think I function as well without a lot on my plate. But its taken years of practice for me to ne-tune my time management to ensure Im not just getting things done but also maximizing every spare minute. This is especially important when it comes to your downtimeeven if its just 15 minutes per day.

    Here are seven things to accomplish while making the best use of every spare minute you have:

    1. Reprogram your scheduleUsing your brief moment of downtime to work on scheduling could save you a lot of time in the future. How much time are you allocating toward meetings, projects, or anything else youre encountering on a daily basis?

    Focus on slivers of time where you can cut back. For example, rather than scheduling a one hour meeting to chat with your team, cut out the u so its 30 minutes or less.

    2. BrainstormingIdea generation is crucial to every startup founder, but it

    can be challenging to nd time in your

    busy schedule. If you have 30 minutes of quiet time in the

    morning, brainstorm some ways to improve your business or just let your creativity ow for a while. Or, if

    your team is having a slow work day, invite them to the meeting room and divide them into teams for an

    impromptu brainstorming session. Give the team with the best new ideas a reward, like ex time or a day to work from home.

    3. Strat...