Posts tagged Startup
10 Mistakes Every Startup Should Avoid When Optimizing for Search Engines by @DholakiyaPratik
May 12th
Search engines are still the number one place people turn when they want to learn something new or solve a problem. If you want your startup to attract and retain the level of attention it needs to survive, investment in SEO is a no-brainer. That said, SEO done poorly can end up doing more harm [...]
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Going Global At Launch: Tips For Building A Micro-Multinational Startup
May 9th
Guest author Gary Whitehill is Entrepreneur-in-Residence at Startup Weekend.
In our hyper-competitive global economy, startups are just as likely to find their first customers in Paris, France, as in Paris, Texas. The barriers to international commerce continues to crumble at a dazzling pace, paving the way for the rise of what SmallBizTrend’s Anita Campbell calls the “micro-multinational.”
Until recently, the designation “multinational” was reserved for giant corporations. This is no longer the case. In a 2007 report, the Council on Competitiveness quoted a USA Today survey revealing that, “of venture-backed software startups created since 1999, nearly 40% have employees outside the United States.”
More importantly for startups, “global firms received more than twice as much funding from venture capitalists as firms with U.S.-only operations.” In addition to targeting a wider customer base, internationalizing your startup can be a competitive edge in securing funding.
Launching a micro-multinational is a complex endeavor, a few critical best practices can help smooth the way.
Internationalize Your Company
In all likelihood, your company’s website will be the primary point of contact between you and potential customers around the world. While a reliable translator is indispensable, several elements beyond mere “Language” settings are essential to making international customers comfortable doing business with you:
Payment Flexibility: In the United States, most online purchases are made with a debit or credit card. This is not necessarily the case in remote regions of the world. Allowing customers to pay in a variety of ways can bolster conversions. Accept payments via PayPal, American Express’ FX International, Xoom or Moneybookers.
Local Support: Ideally, you will be able to hire – or contract – at least one representative in every country or region where you conduct significant business. If your budget doesn’t allow for local full-time employees, be sure to forge strong partnerships with suppliers and agents on the ground. Providing customers with local contacts helps builds confidence and can be a competitive sales advantage.
Maria Springer, co-founder of LivelyHoods notes that, “trust is key in markets swimming with empty promises and ‘cheap’ products. We train our Kenyan sales reps equally on customer service and product knowledge. Also, when an in-person conversation isn’t possible, an unexpected phone call to the customer about their purchase goes a long way.”
At last resort, if you don’t have employees or third-party representatives on the ground, offer telephone or online chat support in the local language during local business hours.
Go “Glocal”
Beyond helping with efficient resolution of customer issues, having employees “in the field” gives your company valuable insights into local cultural idiosyncrasies. As Jake Ludington suggests, “Go local in each new global region by focusing on the full picture. Marketing communications need to be consistent with the region.” Your domestic marketing strategy may not translate to the international stage. Entrepreneurs should tailor their products, and especially the presentation of their products, to the target market.
This can be more difficult than you think. For instance, you may not know that in Malaysia, English-speakers say “yes” to indicate that they heard you, not that they agree with you. In Japan, meanwhile, discount pricing is often seen as a sign of an inferior product.
“Cultural fluency” is not easily acquired. A native German will liekly understand German culture better than even well-informed American. The best way to “go local in each new global region” is to partner with an expert, better known as a “market native.” Working with cultural ambassadors provides a deeper understanding of your target customers’ needs, which in turn enables more finely honed marketing.
Do Your Prep Work
“Many entrepreneurs in foreign locations express frustration in trying to reach customers outside of their own country, but their efforts seem halfhearted and more like bad excuses,” says Tristan Kromer, founder of Lean Startup Circle.
Locals will have the most accurate perceptions of existing demand for your product or service, so “start by going through your first- and second-degree connections on social media sites,” says Tristan. Fellow entrepreneurs may also be able to help. Talk to your friends and contacts and learn from their overseas experiencese.
It is also worth consulting the experts. Attorneys specializing in international trade, intellectual property protection and foreign tax law; international accountants; and export officials are all valuable resources. Indeed, the federal government has an entire site dedicated to “helping U.S. companies export” (Export.gov: its market research tool is especially useful).
No one is saying selling around the world is easy, but it is easier than it has ever been. More lucrative, too.
Image courtesy of Shutterstock.
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10 Mistakes Every Startup Should Avoid When Optimizing for Search Engines
May 9th
Search engines are still the number one place people turn when they want to learn something new or solve a problem. If you want your startup to attract and retain the level of attention it needs to survive, investment in SEO is a no-brainer. That said, SEO done poorly can end up doing more harm [...]
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The post 10 Mistakes Every Startup Should Avoid When Optimizing for Search Engines appeared first on Search Engine Journal.
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How To Staff A Startup With (Almost) No Money
May 3rd
Guest author Gary Whitehill is Entrepreneur-in-Residence at Startup Weekend.
Struggling entrepreneurs around the world are in deep envy of Nick D’Aloisio’s business acumen. Last month, the 17-year-old sold Summly, his news-aggregation app, to Yahoo for a reported $30 million! If and when D’Aloisio starts another company, it will certainly be, to put it mildly, well-funded.
Of course, most entrepreneurs do not have access to that kind of cash. The average business takes years to break even, let alone post a profit. Two-time entrepreneur Jordan Eisenberg, founder of UrgentRX warns that, “Few things in a start up are more important than carefully managing cash. At the beginning, before you have investors, it is not unusual for you (and possibly employees) to forego salary for extended periods of time. Do whatever it takes to build your product and get it to market.”
While the founders of a company might be willing to forgo a paycheck for months on end to get their business up-and-running, their employees may not be so eager to make that sacrifice. To get workers to go along, cash-strapped entrepreneurs have to get creative.
Non-Monetary Incentives
Many startups simply do not have the money for any kind of traditional compensation plan. That’s why so many entrepreneurs try to leverage equity. Taking on co-founders or compensating employees with a stake in the company can be a viable initial fix, but it isn’t always sustainable.
Fortunately, there are other low or no-cost alternatives to get people to do work on your startup.
StartupDigest, for instance, champions the Curator Model. The company finds talented individuals to manage or “curate” the digest for their home cities. Curators receive no financial compensation, yet management insists volunteers line up to lend a hand. Why? Because the platform lets curators distribute digests in their own names. It’s a win-win transaction in which no money changes hands.
As long as a curator is not a potential competitor, it allows collaborators to self-promote/and leverage the company’s rolodex in exchange for some form of labor. When an employee or partner wants to spend his or her time performing tasks you need done, the need for monetary compensation can drop out of the equation.
Colleges and universities can also provide free labor in the form of interns. Offering mentorship in exchange for help at the office can pay divdends, especially since many college students bring a deep grasp of social media and other technological chops that make them capable of much more than just making coffee.
Life Hacks
Sometimes startups need to hire real paid employees. To land high-caliber talent at a rate you can afford, make your startup worthy of others’ personal investment.
‘Life hacks’ don’t cost a lot of money, but can make working at a startup more desirable than a better-paying position at a staid old-guard firm. Silicon Valley companies like Google and Facebook are well known for providing employees with everything from in-house chefs to daycare. Those are expensive, but ther are other tactics available:
• Flexible scheduling: Startups aren’t a 9-5 job so let employees come in when they want.
• Remote working: Forget Marissa Mayer. If employees are productive at home, let them work from there when they need to. At least they won’t leave to go work at Yahoo.
• Public recognition: Praise in front of others for our efforts is an innate human need – leverage it to build loyalty!
Focus on offseting lower wages with fun, engaging and accommodating perks that don’t cost the company a lot of money. It’s the best way to compete for the talent you need.
Not evey candidate will sign on to a vow of poverty to work at your company, but there are people out there ready to take a bit less in order to become part of something special.
Image courtesy of Shutterstock.
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Samsung, Intel Invest In “Anticipatory Search” Startup Expect Labs
Apr 30th
Expect Labs, which is a small startup in the San Francisco Bay Area, has a very impressive list of investors. Today the company announced a new funding round, though the figures weren’t disclosed. Investors are the venture or investment arms of Intel, Samsung and Telefonica. Telefonica is the…
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Bootstrapping Your Startup: 7 Hard-Earned Tips From Real Entrepreneurs
Apr 30th
Everyone talks about the difficulty and importance of securing funding for your new startup. But that’s not the only way to go. Plenty of startups intentionally avoid taking investor cash in an attempt to control the direction of their companies and focusing on product.
So called “Bootstrapping” can be a boon or a bust; you might be missing out on the kind of fast growth a only major cash infusion can provide, but running lean has advantages too.
For insight, we asked seven experienced bootstrappers from the Young Entrepreneur Council (YEC) to share, firsthand, the biggest benefits they’ve seen from bootstrapping – and what startup founders need to watch out for.
1. You Don’t Need Money To Teach About Money
I bootstrapped my most recent startup because I didn’t want to lose control of the creative direction before I had proven the concept and sales model. I’m working in an area which has little-to-no track record (financial literacy education for young kids by working with financial institutions as distribution channels), and I wanted to test it first before having to answer to someone who wants to do it his way. An upside to doing it this way is that I am acutely aware of my spending decisions and make them with much thought, but this can also be a downside. There is never a clear “right way,” so I continue to bootstrap until my gut tells me otherwise and/or a great opportunity presents itself. – Darrah Brustein, Finance Whiz Kids | Equitable Payments
2. Don’t Strap Your Startup Too Tightly
The biggest benefit of bootstrapping for me is that I own 100% of my company, which means I have the freedom to take it any direction I please. There are no outside investors with their own special interests. I am solely responsible for the success or failure of the company. This, in turn, causes some drawbacks as well. Advice and opinions from investors can be very valuable and beneficial to the growth of your company. In addition, their networks can also produce connections that weren’t previously available. However, I’ve learned quickly that there are many successful entrepreneurs who are happily willing to give advice and direction without wanting anything in return. It’s up to me to reach out and show genuine interest in their advice and experiences. - Shahzil (Shaz) Amin, Blue Track Media, LLC
3. Trading Growth For The Ability To Pivot Quickly
Contrary to what you might think, being in bootstrap mode actually makes pivoting easier. With a lean operation, the costs for dropping ideas and moving in a new direction are minor, whereas the sunk costs that come with pivoting with money can be nerve-wracking. The biggest drawback is the loss of opportunity for rapid growth. There can be instances where hitting your niche hard and fast is crucial to establishing yourself in your market. A cash infusion at the right time can be what saves your company from the startup graveyard. - Nanxi Liu, Enplug
4. Keep The Profits
One of the most under-recognized benefits to not bringing in outside funding (in particular, institutional or VC money) is that it means if you create a profitable company, you can actually distribute and enjoy those profits – meaning you can have a positive (and ongoing) outcome outside of a liquidity event. VCs are not interested in receiving dividends – it’s just not in their business model. They want cash to sit on the balance sheet, or even better, see it all thrown back into the business (even if there aren’t necessarily good places to put it). – Michael Mothner, Wpromote
5. Focus On The Customer
The greatest thing about bootstrapping ColorJar is that our management team gets to do what’s best for our customers, rather than our balance sheet. By all means, we’re trying to run a strong business – and we’ve grown quickly – but if we want to take a calculated risk or go the extra mile for a client when it’s not in the budget, we can just go for it and act quickly. The drawback of bootstrapping is managing the ebbs and flows of cash flow without a cushion, but banks can help there. Overall, we’re a better company with a better process and better service because we’ve grown at our natural rate and not at the rate required by capital injection. - David Gardner, ColorJar
6. The Ability To Keep A Day Job
I bootstrapped my business for almost seven years while working 80 to 90 hours per week as an investment banker and later a VC. It was a significant personal sacrifice, but I was able to reinvest 100% of the cash flow from Varsity Tutors and a large percentage of my “day job” earnings into growing the business. As a result of that initial sacrifice, money was spent improving every aspect of the company’s operations, as opposed to paying myself a salary. Since I had a day job upon which I could rely, it allowed me to be far more aggressive with the investments we made in improving the company. The downside was missing years of social activities. In retrospect, it was certainly worth it. - Chuck Cohn, Varsity Tutors
7. Don’t Spend Money, Make Money
In my experience, the biggest benefit of bootstrapping was learning how to offer a great-quality service. Because we weren’t funded, we had to make money, and the only way to do that was by offering a great service and hustling. Bootstrapping makes you grow as a person. It’s tough, stressful and full of ups and downs. And those things teach you invaluable lessons. - Zach Cutler, Cutler Group
The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.
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Weaponizing The Patent System: A Tiny Startup Faces Financial Extinction
Apr 29th
Ditto is a 15-person eyewear startup that utilizes remarkable software — a 3D modeling system that replicates the buyer’s face — to let customers try on glasses virtually before purchasing them. Unfortunately for Ditto, its innovative software has put the company in the crosshairs of Glasses.com.
Glasses.com is owned by 1-800 Contacts, a much larger online eyewear retailer that recently purchased an old patent from a defunct company (U.S. Patent 7,016,824 covers selling glasses online based on 3D models) and announced its own version of 3D try-on software for glasses – while simultaneously filing a patent-infringement lawsuit against Ditto.
1-800 Contacts claims that it plans to its own service as an iPad app sometime soon. But this plan was first publicized on April 17, 2013, while Ditto launched its version a year ago.
David vs. Goliath
“It’s a game-changing event, truly. It’s terrifying,” sighed Ditto CEO Kate Endress. “We’ve had to stop all marketing, every dollar has to go into this litigation.” 1-800 Contacts refuses to license the patent to Ditto; instead it’s seeking an injunction to stop Ditto from using the software. The only option, as Ditto sees it, is to lawyer-up and try and win the suit.
Making things even more expensive, 1-800 Contacts is suing California-based Ditto in its home state of Utah. Whatever the outcome of the suit, the most likely result is the depletion of Ditto’s cash reserves and the destruction of the company.
That’s because this battle is far from equal. 1-800 Contacts was founded in 1995 and took off thanks to a partnership with Wal-Mart started in 2008. In 2012 it was bought by WellPoint for close to $900 million. Yeah, that WellPoint, the largest for-profit, managed health care company in the Blue Cross and Blue Shield Association, with revenue in 2012 revenues of $61.7 billion and more than 43,000 employees.
“If we win this infringement case, we’re still out the millions of dollars we spent winning. That’s why it has become punitive for companies to innovate,” Endress said. ”The patent systems is structured in a way where it lets corporations act like patent trolls where they can buy things they didn’t invent.” And in this case, “we are literally going up against a giant corporation,” Endress noted.
1-800-Not-Our-Fault
When reached for comment, 1-800 Contacts told ReadWrite:
1-800 CONTACTS and its Glasses.com division have invested significant time and resources into the development of the interactive try-on platform technology and acquiring the appropriate patent rights to protect it. However, we do not comment on pending litigation.
1-800 Contacts released a more elaborate statement to the Electronic Frontier Foundation (EFF), which has defended Ditto online: ”1-800 Contacts invested significant time and resources to acquire and license the existent patent rights needed to practice its technology. Clearly, Ditto did not do the same.”
The EFF was not impressed: “1-800-Contacts says it is not a patent troll. Sure, the company is not a classic patent troll – a shell company that does nothing but buy patents and sue – but it’s little better.”
What Makes A Patent Troll?
Could this entire issue be a misunderstanding, where 1-800 Contacts actually spent years pouring money into this concept, only to see a brash startup steal its lunch? Maybe, but 1-800 Contacts’ history of aggressive litigation doesn’t inspire confidence in that interpretation.
In 2002, the company pursued WellU.com over pop-up advertisements that displayed competitors’ products. 1-800 Contacts was granted a preliminary injunction, but WellU won on appeal. In 2008, the company fought with Google over controversial search-related provisions of a Utah trademark law that were eventually repealed. And in 2010, 1-800-Contacts sued Contact Lens King, Inc. over key-word advertising.
Despite the odds, Endress vows that, “We’re going to vigorously defend ourselves. We’re so proud of what we built. Maybe we can become cash flow positive and survive.” The EFF is asking for help in trying to invalidate the patent in question, but no matter how the legal complications unfold, the road Ditto faces will certainly be long and expensive.
Images courtesy of Ditto.
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Google Buys Startup Wavii in Move to Boost Knowledge Graph
Apr 27th
Google has acquired news summarization start-up Wavii for more than $30 million. Wavii, which uses natural language processing technology to distil online news into topics the users most care about, confirmed the news in a post on their website.
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5 Reasons Working For a Hot Startup Isn’t As Cool As You Think
Apr 11th
Guest author Matthew Bryan Beck is editorial director of The New York Digital.
Everyone wants to work for a hot startup. They’re hip, fun and run by passionate, creative people with exciting, innovative ideas. But working at that awesome startup can come at a cost to your career and your sanity. Consider these points before quitting your safe, secure position at a big, established company:
1. The Hours Are Long
Young companies building a new product or service from the ground up run on small teams, limited resources and no time to spare. And they expect their people to give 110% to the job. Your social life outside the office will likely suffer, and the pressure to stay later and later can make you feel like a deserter if you need to leave the office on time for personal reasons.
2. The Pay Sucks
Unless you’re a senior executive of a startup, your compensation may leave something to be desired. The bulk of startup funding goes into the operations and product first, and the people second. For the amount of hours you can be required put in each week, the pay may feel inadequate. The tradeoff that startups offer is the cool factor – plus equity and stock packages. And there may be perks like free snacks and lunches, beer kegs, discounted gym memberships, yoga classes, flexible vacation time, ping-pong, etc.
3. Big Egos Rule
Startups are built on exciting ideas from brilliant minds, but those can also come with egos. Like any workplace, many startups have a pecking order. While most startups advertise a spirit of open forum and democratic exchange of ideas, you may have to earn your stripes before your input is valued and your ideas are implemented. Visionaries are, understandably, protective of their visions, and you may find yourself in a work environment that feels more like a tyranny than a democracy. (Note: Please make sure you’re not the one with the ego.)
4. Distractions, Distractions, Distractions
Startups pride themselves on a casual, hoodie-and-jeans company culture, the antithesis of the stereotypical corporate suit. Open, collaborative, cubicle-free working environments foster a sense of community and togetherness. But the frat-house vibe can also be counterproductive and result in a lack of oversight and structure. In this kind of less-than-professional office, employees may get too chummy, spending more time on Facebook, socializing, coffee runs and cigarette breaks than getting work done.
5. You Probably Won’t Last
Many new startups suffer from the revolving door syndrome, struggling to keep a stable team. Sometimes they hired the wrong people, but sometimes the person shown the door is you. A recent study of 20,000 new hires by research firm Leadership IQ found that 89% of the time new hires failed, it was for ‘attitudinal reasons’, not lack of skill. Make sure you are a good fit for the startup before submitting your resume. If you do get the job, make sure to bring (and keep) a good attitude.
So Now What?
Keeping positive, staying loyal and consistently producing high-quality work is the best way to impress any company. Working for a startup can be a sacrifice of time and money, but it’s also a commitment that can pay off if the company grows rapidly. Many startup employees move on to form their own companies or parlay their experience into an in-demand calling card. If you think you have what it takes, don’t let these warnings slow you down.
Image courtesy of Shutterstock.
View full post on ReadWrite
5 Reasons Why Working For a Hot Startup Isn’t As Cool As You Think
Apr 11th
Guest author Matthew Bryan Beck is editorial director of The New York Digital.
Everyone wants to work for a hot startup. They’re hip, fun and run by passionate, creative people with exciting, innovative ideas. But working at that awesome startup can come at a cost to your career and your sanity. Consider these points before quitting your safe, secure position at a big, established company:
1. The Hours Are Long
Young companies building a new product or service from the ground up run on small teams, limited resources and no time to spare. And they expect their people to give 110% to the job. Your social life outside the office will likely suffer, and the pressure to stay later and later can make you feel like a deserter if you need to leave the office on time for personal reasons.
2. The Pay Sucks
Unless you’re a senior executive of a startup, your compensation may leave something to be desired. The bulk of startup funding goes into the operations and product first, and the people second. For the amount of hours you can be required put in each week, the pay may feel inadequate. The tradeoff that startups offer is the cool factor – plus equity and stock packages. And there may be perks like free snacks and lunches, beer kegs, discounted gym memberships, yoga classes, flexible vacation time, ping-pong, etc.
3. Big Egos Rule
Startups are built on exciting ideas from brilliant minds, but those can also come with egos. Like any workplace, many startups have a pecking order. While most startups advertise a spirit of open forum and democratic exchange of ideas, you may have to earn your stripes before your input is valued and your ideas are implemented. Visionaries are, understandably, protective of their visions, and you may find yourself in a work environment that feels more like a tyranny than a democracy. (Note: Please make sure you’re not the one with the ego.)
4. Distractions, Distractions, Distractions
Startups pride themselves on a casual, hoodie-and-jeans company culture, the antithesis of the stereotypical corporate suit. Open, collaborative, cubicle-free working environments foster a sense of community and togetherness. But the frat-house vibe can also be counterproductive and result in a lack of oversight and structure. In this kind of less-than-professional office, employees may get too chummy, spending more time on Facebook, socializing, coffee runs and cigarette breaks than getting work done.
5. You Probably Won’t Last
Many new startups suffer from the revolving door syndrome, struggling to keep a stable team. Sometimes they hired the wrong people, but sometimes the person shown the door is you. A recent study of 20,000 new hires by research firm Leadership IQ found that 89% of the time new hires failed, it was for ‘attitudinal reasons’, not lack of skill. Make sure you are a good fit for the startup before submitting your resume. If you do get the job, make sure to bring (and keep) a good attitude.
So Now What?
Keeping positive, staying loyal and consistently producing high-quality work is the best way to impress any company. Working for a startup can be a sacrifice of time and money, but it’s also a commitment that can pay off if the company grows rapidly. Many startup employees move on to form their own companies or parlay their experience into an in-demand calling card. If you think you have what it takes, don’t let these warnings slow you down.
Image courtesy of Shutterstock.
View full post on ReadWrite
