Tuesday, January 22, 2013

Selling A Business: Top Ten Tips For Entrepreneurs

Entrepreneurs often find themselves in high-stakes negotiations with big, savvy players, with significant negotiating power (referred to herein as “Big Boys”) — whether it be a venture capital firm in connection with a financing or a private equity firm in connection with the sale of the entrepreneur’s business; the situation can indeed be daunting. Below are ten tips for entrepreneurs to help them through this process.

1. Retain a Strong Team. In dealmaking as in business, you are only as good as your team. Accordingly, the first step for the entrepreneur is to retain a strong transaction team — and the quarterback of the team should be an experienced corporate lawyer. Indeed, an experienced corporate lawyer will not only add value to the transaction, but also can help the entrepreneur build-out the team and tailor it to the particular deal (e.g., in an acquisition, a strong tax lawyer is imperative to help structure the deal or in a licensing transaction, a strong IP lawyer is often necessary, etc.). The Big Boys are generally represented by large, aggressive law firms, and the entrepreneur must ensure that his/her team is up to the task.

2. Do Your Diligence. Due diligence is often a critical component to any deal. One form of diligence that is often overlooked, however, is an investigation of the guys on the other side of the table. What’s the reputation of the Big Boy — e.g., is this a venture capital or private equity firm that treats its portfolio companies well or is this a firm that squeezes the little guy? What about the particular individuals with whom you are dealing? What are their reputations? Are they good guys with whom to partner or are they jerks? Indeed, the web is a good starting point for the entrepreneur who needs background information on a particular firm/individual. At a minimum, the entrepreneur should track down other entrepreneurs or CEO’s who have done deals with the guys on the other side of the table and make an informed judgment as to whether they are guys with whom the entrepreneur wants to do business.

3. Create a Competitive Environment.

Monday, January 21, 2013

How to Turn Around a Failing Business

What went wrong and how can you salvage what you have left?

Be Honest with Yourself

We all know that every business doesn’t succeed, but that doesn’t change the fact that you never want yours to be one of the ones that doesn’t make it. But pride and ego can’t be the only reasons for launching a rescue operation. Now is the time for some hard self-inquiry.

You need to ask yourself the difficult questions to make sure you’re in this for the right reasons and that you’re truly willing to do what it takes to turn the business around. Ask yourself these questions and answer honestly:

  •     Are you passionate about what you’re doing?
  •     Are you qualified to do what you’re offering?
  •     Are you willing to make sacrifices to reach success?
  •     Are you stepping out of your comfort zone?
  •     Have you invested the time, effort and finances necessary?
  •     Do you want to continue being a business owner?

Be Accountable

If you look at the history of your business closely and with an open mind, you will probably be able to identify the mistakes that were made that led to the downturn. While this is certainly not time to beat yourself up over mistakes and bad decisions, you need to own up to the role you played. Identify what you could have done differently and learn from it.

You may even want to team up with an accountability partner or a mentor to help keep yourself on the right track and make the most of your new perspective.

Try Something New

Many businesses fail because they become static. Let’s face it – it’s hard to dedicate yourself to something when you’re bored out of your mind.

Sometimes it just takes something new to breathe fresh air into a stale business. And it can be anything: launching a new marketing campaign, offering new services, writing a book, teaching a class, joining a new organization, anything that gets you invested and excited again.

Watch the Numbers

How to Restructure Your Business Debt to Avoid Bankruptcy

Taking Control of Your Debt Before It Controls You
It is not easy building a successful business, especially in an economy that is not as strong as it once was. In many situations, a business owner will continue doing what they think is right, only to find all too soon that their debt has suddenly grown to the point where bankruptcy may be an unavoidable reality.

Your dream of owning your own business does not have to end in bankruptcy court. There are options other than bankruptcy available if you catch and address the important issues early enough. One of the most proven is restructuring your business debt.

Researching Debt Restructuring Companies

If trying to get control of your business debt has you overwhelmed, then you may want to seek the help of a professional debt restructuring company in your area. Before you do, however, it is very important for you to research the company to ensure the one you are interested in is legitimate.

Contact the Better Business Bureau to find out if the company’s counselors are licensed by the American Board of Certification or if any of their previous clients filed any complaints against them. Research several different companies before settling on one to handle your debt restructuring plan.

Even after you sign on with a debt restructuring company, it is important to stay on top of things. Continually check to make sure the creditors are receiving their payments when they are supposed to. If they are not, then immediately change debt restructuring companies.

Exchange Debt for Creditor Equity

In some circumstances, a business owner may be able to give a creditor a certain amount of equity in their company in exchange for a portion of the debt being relieved. One does have to be careful in determining how much equity to exchange, however, as you do not want the creditor to assume majority control of the business.

Issue More Shares 

How to Restructure a Company to Increase Profits

Restructuring a company in the face of declining profits is a tough, nononsense operation that requires a willingness to face financial realities and triage difficult decisions. There are ways to not only stop the bleeding, but also heal and strengthen the patient for the future.


        1.Consider hiring a turnaround specialist--as either an interim manager or a consultant--to help with restructuring. An outsider often brings objectivity and a fresh point of view.
        2.Analyze the extent of the problems. Is the profit picture merely ailing or is it terminally ill? Is the company's core business still financially viable?

        3.Develop a restructuring plan and present it to the board of directors, management and employees. It may also be advisable to show the plan to certain outsiders, such as bankers and other creditors, and to major vendors.

        4.Start at the top. Replace weak members of top management and the board of directors. Then reduce management layers. Unprofitable companies are often bloated with middle managers.

        5.Investigate the possibility of restructuring debts or acquiring bridge loans to finance the restructuring costs.

5 Small Business Success Strategies you can develop

Below are 5 Small Business Success Strategies

1. Develop your USP (unique selling proposition)

It does not matter what your business is or in what industry you operate, you’ve got to stand out from the crowd by creating a compelling USP that sells you and the business almost instantly. The starting point of developing a USP is to ask yourself questions such as;

  •     what is my passion?
  •     who do I want to serve?
  •     who are my potential customers?
  •     what do they need?
  •     what can I offer?
  •     will they be willing to pay?
  •     how much? etc,

The list of questions can go on and on from this point. This is a key small business success strategy I advice you to learn and practice.

2. Develop your Elevator pitch

Can you explain your business in 60 seconds? Imagine, lodging in one of the Hilton hotels and there you are in an elevator and suddenly it slides open and a top executive of a company you have been trying to do business with steps in, what will be your reaction? Are you going to wait for the perfect day? or would you swing into action and use your neatly crafted elevator pitch to introduce yourself or your business? If you are like me, I bet you’ll maximise every bit of that opportunity.

Remember, opportunity is a haughty goddess – the Richest man in Babylon

3. Develop a Testimonial system

Do you want to experience small business success? Then you’ve got to develop a testimonial strategy. It does not matter when or where, get into the habit of asking (begging on your knees) for testimonials as long as your product or service delivers on its promises. Get them to write about it but it is preferable if they agree to do a 60 seconds video for you, because pictures speak a thousand words and videos a whole lot more. Having testimonials from satisfied customers is one small bu
siness success strategy that will take your business to the next level.

Testimonials do play an extremely important role for small businesses especially in areas such as PR, advertising etc.

4. Develop an Upselling strategy

How to Take Your Business to the Next Level in 2013

Companies also will be taking steps to achieve greater prosperity next year. To make your own resolutions about growing your business, consider these 10 steps as part of a successful 2013 action plan.

Move forward even in uncertain times. Over the next 12 months, companies will need to deal with health-care reform, changing regulations and still volatile economic times, but they can't let those uncertainties paralyze them, says Jeffrey Fox, a business author and consultant in Chester, Conn. Even in the worst economic times, some businesses thrive, says Mark Stevens, founder of MSCO, a marketing advisory firm in Rye Brook, N.Y. He advises companies to aggressively investigate potential new markets, invest in marketing, and test new ways of promoting themselves to bring in new customers and revenue.

Tap your employees. Your employees are a tremendous resource for new ideas, says Ken Blanchard, co-author of best-selling classic The One Minute Manager (William Morrow, 1982) and founder of the Ken Blanchard leadership training companies based in Escondido, Calif. For example, he notes that a Southwest Airlines employee proposed the idea that led to Business Select, which allows passengers to pay extra for such perks as priority boarding. "That one idea has made the business millions of dollars," Blanchard says.

Reconnect with your purpose. When you started your business, you had a vision for what you wanted to create. Find ways to rekindle that fire in your belly, Blanchard says. Whether it's sales, finance or product development, spend more time working in the areas of your business that excite you, he suggests. "If you don't love what you're doing, you're never going to work hard enough to be one of the best."

Diversify your income opportunities.

Seven Strategies for Doing Business in Times of Crisis

As entrepreneurs, we move quickly in business. We make decisions with breakneck speed. We implement in the blink of an eye. We innovate. We execute. We tend to be nimble, spontaneous, and mission driven. As entrepreneurs, it’s part of who we are—and we have the technology at our fingertips to assist us even further.

But there are times in life and business, when we need to take a step back, breathe, slow down—and think it through more carefully than usual—especially during those rare times of national, even global crisis. For us, that has happened twice in just the last two months with two national tragedies that hit very close to home here in Connecticut, where Client Attraction.com is headquartered.

Both times—first during Hurricane Sandy (one of the most severe storms to ever hit the East Coast) then again during the Newtown shootings (one of the deadliest school shootings in history), our nation experienced deep heartbreak as we watched our fellow citizens endure pain and severe loss. And both times over that short span of two months, we as a small company with clients to serve, employees to support and year-end goals to meet, were in the middle of a major business launch.

Did we do everything right in response to the tragedies? No. But we’re learning and applying what we’ve learned to our Best Practices so that as a company we can continue to get better at what we do, continue to improve our service to our customers and clients, and to always, always put people first.
The high tech environment in which we do business today—

Writing a Business Plan? Don't Forget About Marketing

For those who dream of escaping cubicles to pursue a passion, drafting a business plan is the first step. One of your plan's most critical elements is your marketing strategy. Too often, people don't think through that all-important component with the same rigor they tackle aspects like projected cash flow and long-term goals.

Or, they do put thought and effort into planning for market research, promotion and positioning -- and then never follow through on their great ideas.

One problem is that most entrepreneurs don't have marketing experience. They may be skilled tradesmen, savvy financial advisers or talented writers -- expert in the niche they plan to build their business around -- but they're not marketers. Some don't realize that executing a solid marketing strategy is essential to any venture's success. Others know it's important but don't know where to begin.

Here's why it's so important: No matter how ingenious your product or service, no one will find it if they don’t know it’s there.

The marketing component of your business plan should include a budget for time, if you plan to tackle the job yourself, and money. You need a timetable and a professional website that attracts visitors and makes it easy for them to learn more about you, your product or service -- and equally easy to purchase what you're selling.

Here are some other points to consider as you're developing your marketing plan:

What is my message? Your message needs to be more than "My product is great." What's the problem it solves? If you're a professional, what's the value you and your service offer? How are you different from your competition? As an example: At my marketing firm, we create visibility and credibility for our clients using a pay-for-performance model that guarantees media exposure and sets us apart from our peers.

Who is my audience?

10 Questions to Answer Before Pitching Investors

Here are 10 key questions to ask yourself before pitching investors.

1. What do your customers need and how do you know for sure?

It isn't enough to tell investors there's a need for your product; you need hard facts and real-world examples to prove it, says Danny Warshay, founder of DEW Ventures, a Providence, R.I.-based firm that provides startup coaching. Often, small-business owners skip what Warshay calls "bottom-up" research with customers. For example, Warshay worked with a pair of entrepreneurs who spent time in the prenatal vitamin section at Whole Foods, where they discovered women didn’t like the large size of vitamin pills and potential side effects of nausea and constipation. They used this bottom-up research when pitching investors on their product Premama, a prenatal vitamin drink that the company says doesn’t have digestive side effects. "When companies are pitching to me, I always look for" bottom-up research, says Warshay, who has helped start more than 15 companies.

2. What evidence can you provide of prior business success?

Often small-business owners focus on the wrong things when trying to show their track record, says Oren Klaff, founder of the Los Angeles-based website PitchAnything.com and author of Pitch Anything: An Innovative Method for Presenting, Persuading, and Winning the Deal (McGraw Hill 2011). When discussing your background, don’t tout the names of companies you’ve worked for or schools you’ve attended. You need to pinpoint specific business achievements. What products have you developed? Which major clients did you attract to your previous employers? How much revenue did you bring in? Investors are always looking for measurable evidence.

3. Who’s on your team?

For many investors, a company's employees are as important as its product or service "That people part is often what gives the whole enterprise credibility," Warshay says. Focus on the experiences, networks and expertise your team offers. If you're a one-man-show or don't have the resources to hire anyone yet, show investors you have specific plans for attracting talent, Soorjoo says. Often, small-business owners will point out the roles that need to be filled without identifying specific candidates and estimating how much it might cost to hire them, he says.

4. How well do you know your competitors?