Growthink Blog

Keys To Hiring & Retaining The Best Employees


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If you are managing an early stage or growing company, it typically means that you are cash restrained.

And, as a result, you are often unable to pay employees salaries commensurate with what they would earn at larger organizations.

So, how do you manage this and hire and retain the best staff?

In order to do this, you need to understand and manage the four core factors that effect an employee's satisfaction and thus willingness to join your company and/or stay with you.

The first key factor is financial compensation, which includes the employee's salary plus benefits such as healthcare, and any significant perks. For the most part, early stage companies can't compete with larger entities when it comes to these salaries.

However, with stock options and/or profit sharing, smaller companies can better motivate employees and give them the potential to earn even more money then their large organization counterparts should the company succeed.

The second key factor effecting employee satisfaction is lifestyle. Specifically, how does your organization accommodate the employee's lifestyle? Do you offer daycare? Flexible schedules? For some employees, the ability of the employer to accommodate their lifestyle is of critical importance.

The third key factor that employees consider when assessing whether to stay with a company is how much they enjoy their jobs and coming to work every day. Clearly there are millions of workers that hate their jobs. But, for the most part, these aren't the best workers. If they were, they would have lots of other job opportunities.

It is up to the small business owner to create an environment whereby employees enjoy their work. They must enjoy working with the other members of the company, the types of work they are doing, and their work conditions. They must feel that they are a part of the overall company culture. They must get along with their co-workers, and feel their boss appreciates them and treats all employees equally and fairly. And they must receive adequate communications as to company policies and decision-making.

The final factor with regards to satisfying your employees is to ensure that they are learning and developing skills that will further their careers, whether or not their futures lie with your organization or with another organization (preferably they see advancement opportunities within your organization).

Employees need to be continuously trained and have the ability to continually learn so that they become more valuable assets. This training can be formal, and/or it can include learning from trying new tasks and projects.

It is up to the business owner to ensure that employees are given training and projects that expand and improve their skills.

As an entrepreneur and/or business owner, it is your duty to hire and retain the best staff. Since, no one person has the ability to grow a massive empire with the help of others. In building your teams, consider and constantly revisit these four key factors and make sure you create and foster and environment that gives your firm a competitive advantage in each of these areas. In doing so, you will maximize your chances of building a truly superstar company.

How Seeking Out Failure Can Lead to Your Success


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I read a very interesting blog post the other day about "survivor bias," an important statistical principle that could greatly affect your future success.

In brief, survivor bias occurs when an analysis excludes information since that information no longer exists.

Let me give you an example...

The English forces, during World War II, sent planes each day to bomb the Germans. As you might expect, several of these planes were shot down. And, the ones that did come back typically returned with multiple bullet holes.

Now, the English obviously wanted to maximize the chances of its planes and soldiers returning home. So English engineers studied the planes that returned. In doing so, they found patterns among the bullet holes. Specifically they found lots of holes on the wings and tail of the plan, but few in the cockpit or fuel tanks.

As a result, the English added armored plating to the wings and tail.

As you might have already concluded, this was the wrong thing to do. The better decision would have been to add armored plating to the cockpit and fuel tanks. For, the planes that were shot in those places were the planes that were shot down and never returned.

The English engineers' analysis missed this data because these were the planes that they were unable to examine. This is "survivor bias"-- their inability to include this critical data in their analysis since it was unavailable or didn't "survive."

So why does this matter to you?

It matters because as you start and/or grow your businesses, you will have to hire service providers and staff. And naturally, you will want to hire those with a track record of success.

But, when you hire staff who have only worked at successful companies, you may fall victim to survivor bias. That is, they have not learned many of the lessons that individuals and companies learn when they fail.

Likewise, when you hire a service provider that claims that every one of their clients has been successful, maybe they haven't learned from client failures.

They say that you learn more from failure than from success.

While that can be debated, from personal experience I can say that I've learned a ton from both failure and success. From successes, I have learned principles and formulas that worked. The ones I strive to replicate on a daily basis.

And from failures, I have learned things to avoid. I have learned flaws in my thinking. But importantly, many of my successes have come out of failure. From tinkering ideas and plans that weren't quite working. And making them work. And, these new ideas would never have come to me had I not failed first.

Now, clearly my advice is not to hire failures or those with a habit of failure. But, likewise, it's not to hire staff or service providers who claim to always succeed. Since a balance between success and failure often provides that winning combination of wisdom.

So, the next time you are interviewing a key hire or service provider, make sure to ask about their failures. Ask about tasks and jobs that they or their companies failed at. And find out what they learned from that failure.

Ideally they are the types of candidates that learned a lot from their failures and were able to overcome them. This is because the vast majority of growing companies fail at things over and over again. It is their ability to constantly modify and improve their businesses that enables them to excel. Surround yourself with people that have this ability.

Growthink Kiva Loan Recipient Repays Loan in Full


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As readers of the Growthink blog know, I LOVE Kiva (Please read my past blog post on it here).  For those not familiar with it, Kiva is a person-to-person micro-lending site –allowing individuals, primarily from developed countries, to lenddirectly to entrepreneurs in the developing world.  The borrowers arein places like Cambodia, Bolivia, Azerbaijan, Lebanon, Peru, andTanzania – and primarily borrow to allow their very small businesses toexpand and hire. 

Kiva was created in 2005 and originally funded 7 loans for a total of$3,500 which were all paid in full. 

Since then, it has grown incredibly. Try these stats on for size:

  • Total value of all loans made via Kiva: $89.7 million
  • Number of entrepreneurs that have received loans: 217,428 (!)
  • Current repayment rate: 98.35% (Phew - how would U.S. mortgage lenders love to be able to say that)
  • Number of countries represented by Kiva lenders: 181 (Who says the world isn't a more inter-connected and better place because of the Internet and technology?)
  • Percentage of Kiva loans which have been made to women entrepreneurs: 82.88% (A lot of academics and political scientists now cite the very high correlation between women's economic advancement and entrepreneurial opportunities and the relative stability of a country and a culture).

Growthink's first Kiva loan (first of many we hope), was made to Ms. Tamalii Iopu, owner of a fishing business in Luatuanuu, Somoa.  Ms. Iopu, a single mother of two, borrowed money last year to buy new fishing gear, and repaid it in full last month.

I would like to say that we had a particularly scientifically methodology for selecting Ms. Iopu from among the literally THOUSANDS of very deserving entrepreneurs on Kiva. The reality is, like most Kiva lenders, we simply connected to her story as presented on the site.  And the very pure repayment histories of all of the borrowers is beyond inspiring. 

Growthink hopes to do a LOT more with Kiva in the months and years to come. As I noted in my previous post, we love it because:

  • Loans, as opposed to charity, promote dignity, accountability and transparency.
  • The “middlemen” are cut out.  And, phew, is it about time.  Kiva is a great example of what the new world of finance will look like in the coming years.  As opposed to big, fat, amorphous Wall Street bankers standing between borrowers and lenders, buyers and sellers of money connect directly via a transparent Internet platform.  This greatly reduces the cost of capital and allocates it to where the marketplace, as opposed to your politician or your good old neighborhood’s old boys network, determines where it is best served.  It is a wake-up call for America.  98% repayment rate!  From the poorest of the poor? The titans of American finance (and the American consumer) could learn a thing or two from the Kiva borrowers.
  • It is more proof, if proof is needed, of the core advantages of small versus big and of owner-operators versus a managerial class


Check out Kiva at http://www.kiva.org. And prepare to be inspired.


Five Mega Trends That Are Transforming Private Equity Investing As We Know It


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Did you know that in the last 10 years, every major stock market index has LOST investors money?

That's right, on an inflation adjusted basis, the Dow, S&P, and NASDAQ have each given investors NEGATIVE returns.

And with all of the meddling in the markets coming out of Washington, prospects for the next 10 years aren't any brighter.

Fortunately, there is a better way. In those same 10 years, while stock market investors made nothing or took a bath, early-stage private equity investors earned over 30% annually.

Why is This?

Efficient markets theory teaches us that private equity will always out-perform the public markets. Investors must be given higher rates of return to compensate for the traditional illiquidity and high variability of the asset class.

And up until recently, access to quality early-stage private equity return vehicles has been a) cost and time prohibitive for most institutional investors and b) simply inaccessible to the smaller, individual investor.

The Times They Are A Changin'

Luckily, this is no longer the case. Five mega-trends have coalesced to transform private equity investing as we know it:

1. The ability to source, research, and monitor deals via the Internet

2. The ability to take a data - versus a personality - driven approach to deal diligence

3. The ability to better price deals utilizing regression analysis

4. The ability to exit deals faster - both via alternative investment trading platforms like Second Market - and also simply because of the increasing velocity of business, especially technology business.

5. The ability and opportunity to properly apply "black swan," or "randomness" modeling to deal diligence

Best regards, and look forward to connecting.
--
Jay Turo
CEO
Growthink, Inc

Follow me on Twitter
Join my network on LinkedIn

  P.S. Are you prepared to be saying in 2019 - "Darn - It has now been 20 years since I made any money with my investments?" The world has changed - time to change with it.


Be Like Mike...In Your Investor Meetings


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According to the book "How To Be Like Mike: Life Lessons About Basketball's Best," Jordan's practice habits and conditioning regimen amounted to an "almost alarming harshness."

In fact, many experts, such as Florida State University professor K. Anders Ericsson, argue that practice continually trumps talent. Prominent examples of success attributed to continuous practice besides Jordan include:

  • Bobby Fischer: yes, he became a chess grandmaster at the ripe age of 16. But, he had nine years of intensive study and practice before this.
  • Warren Buffet: who is known for his extreme discipline and the significant time he devotes to analyzing the financial statements of organizations he considers investing in.
  • Winston Churchill: who is widely considered one of the 20th century's best speakers; it is said that he compulsively practiced his speeches.
  • Tiger Woods: who developed rigorous practice routines from an extremely young age. He continues to devote hours upon hours each day to conditioning and practice in order to improve his performance.

These same practicing principles apply when you are selling your company and your products/services to investors, customers, partners and/or employees.

With regards to your elevator pitch, which is often your opening communications with all outside constituents, practice it over and over again until it flows from your mouth and causes prospects to nod in agreement and understanding each and every time.

With regards to your investor presentations, you should practice them over and over again. And when you practice them, you should think about the goals of your presentation and simulate the questions you might be asked.

For example, you should be thinking:

  • What is the outcome of the meeting that I am seeking?
  • What questions about my business will the investor have, and how will I most quickly and easily answer them?
  • What investment objections might the investor have and how will I overcome them?
  • What will be the signs that my presentation is going well, and how will I adapt if it is not?

By practicing your presentation over and over, you will get better and better at it. Just hearing yourself saying the words out loud will help. You will hear what sounds good and what doesn't.

Likewise, you should practice your presentation on real people -- your advisors, friends or family members. And after these mock presentations, ask them to recite back to you the key points you made. Importantly, make sure they recall the key points that you want to convey. If not, continue to improve your presentation content and your delivery until it reaches perfection.

Growthink Again Makes Inc. Magazine's Top 50 and Top 100 Lists


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I am very happy to report that Growthink was named to the Inc. 5000 list for the 2nd year in a row.

We were ranked as one of the country's 50 fastest-growing financial services companies (#45) and one of the 100 fastest-growing businesses headquartered in Southern California (#71).  Our comprehensive survey ranking was 1,042 out of the 5,000 fastest growing companies in the country.

Our standing is a testament to the work ethic and passion of our people as we navigate these historic markets. And our continued success highlights the power and importance of small business and entrepreneurship to the American economy.

I am also happy to report that in spite of my fears of a slow  business summer, August has proven to be an incredibly busy month here at Growthink. Our 3rd quarter revenue numbers are on pace to come in at over a 30% uptick from Q2, and as importantly, the quality of our new client portfolio deals is incredibly high.

For a snapshot overview of some of the rockstar companies that we have brought on recently, click here.

How Can YOU Get Involved?

If you believe in emerging technology and in American entrepreneurship, if you're tired of the losing stock market game, and are open to the new and the different, then we should talk.  


Best regards, and look forward to connecting.
--
Jay Turo
CEO
Growthink, Inc

Follow me on Twitter
Join my network on LinkedIn


Hispanic America - Go Where the Growth Is


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It is no secret that Hispanic America is exploding.  As the fastest-growing sector of the U.S. population, the U.S. Hispanic population is projected to triple from its current 45.5 million, to over 150 million by 2050.

And this exploding demographic group spends money - over $1 trillion in 2008 alone.

Why Should You Care?

Well, if you are looking for a dynamic, long-term macro-growth sector and one filled with special situation opportunities - then you should care.

Try Beverages.

Of the $210 billion U.S. consumers spend on beverages each year, Hispanics spent $24.8 billion of that.  And with rising affluence, the "ready-to-drink" Hispanic-focused category is one pulsating with deals.

Who Says So?

Well, only some of the biggest beverage and consumer products companies in the world - like Coca-Cola, Pepsi, Kerin (of Japan), Pernod Ricard, China Water, and Inbev - which shocked the world with its $52 billion acquisition of Budweiser last year.  

Putting It all Together

The macro trends here areas simple as 1-2-3.  1) Exploding Hispanic Population. 2) Rising affluence - leading to exploding demand for consumer products and 3) Robust sector acquisition activity.  

Now for the micro:  Find a company that 1) Has the right product with the right distribution. 2) Is targeting a niche sector that is unoccupied by the big boys and 3) Isn't so big and well-known that the "business as  opportunity" has passed.    

Best regards, and look forward to connecting.

--
Jay Turo
CEO
Growthink, Inc


A Great Tactic for Both Pitching Investors & Thriving On Twitter


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I attended a great online marketing conference a few months ago and learned a lot about marketing your business via Twitter.

The key Twitter advice that was given was to treat Twitter interactions just as if they were offline in the "real world."  That is, act just like you'd act as if you were meeting at a cocktail party.

For example, at a cocktail party you wouldn't go up to someone and start screaming "this is what I do" and "buy my product now." (A lot of people do this on Twitter.)

Rather, you would get to know the person, ask them some questions, and hopefully provide some valuable information and advice. This process builds rapport, shows them that you care about them, and positions them to reciprocate in the form of wanting to learn more about and support your business.

So, how does this relate to pitching investors?

Well, I recently read an interesting blog post by Nic Brisbourne, a venture capitalist based on the UK. The key message of Brisbourne's post was that entrepreneurs should pitch him as if they were pitching their best friend.

In doing so, entrepreneurs should:

  • Give the information straight
  • Keep it interesting
  • Deliver it like a conversation rather than like a fire hose
  • Try to inject some humor
  • Do as much listening as talking
  • Focus on the areas that your friend wants to hear about
  • Adjust the length of the pitch to the level of interest

Like in your Twitter conversations, it's not all about you. You need to listen to the needs of your investor audience before you pitch them. You must develop rapport. And you can't pitch, pitch, pitch. You need to slow down and deliver your pitch in a more integrated fashion (such as giving some information, allowing the investor to ask questions, and responding as appropriate).

So, before you speak with your next prospective investor, you should create a checklist in your mind. Make sure you understand the needs of the investor, make sure you ask questions and do a lot of listening, and make sure that you effectively convey your message without being overbearing.

How To Make Your 33 Wishes Come True


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I came across a very interesting advertisement in my Sunday paper the other day.

The ad was from a psychic named Maria that promised to allow you to achieve up to seven of 33 possible wishes.

Now, before I go any further this seemed to be a scam, and in fact, upon checking online, this psychic unfortunately appears to have been scamming people around the world for many years.

However, what I found really interesting was the list of 33 wishes that the advertiser supplied.

I figured that these scammers (since they probably have spent millions in advertising) did some research to ensure that these 33 wishes were universal; that is, that they pretty much sum up the wishes of most people. From a marketing perspective, this is something I found very interesting.

Below are a handful of the wishes on the list that stood out to me the most.  Believe it or not, I firmly think that each of us CAN achieve each of these wishes. So, below each wish, I have provided my thoughts regarding how to achieve them  -- without psychic assistance.

1) Sell or set up my own business

Start learning now to start, finance, grow, and exit your company.

2) Have a monthly income of $5,000.00

Start a business. Work hard. Make it successful.  $5,000/month is nothing if you have a successful business.

3) Win enough money to never have to work again

Build a successful company. Sell it.

4) See my kids do really well in their studies

Work hard in starting and growing your successful company. Because you are the boss, you can spend more time with your kids helping them. Your hard work will also provide the funds to hire a tutor as needed.

5) Be on TV

Once you've started that successful company I've mentioned a couple of times- hire a good PR firm.

6) Attract men/women

Working hard and being successful will give you the confidence to better attract members of the opposite sex.

In fact, the majority of things on this "wish" list...

  • Finding a job which is enjoyable and pays well
  • Be able to stop working with a substantial monthly income
  • Solve my financial problems once and for all
  • Get a new car
  • Travel around the world
  • Have enough money to help out my family
  • Retire with enough money to have no worries
  • Buy a boat
  • Buy a house
  • Go on a cruise
  • Have a house in the country
  • Success in an important competition
  • Be the friend of wealthy people
  • Never have any more money problems



..can all be attained by starting and growing a successful business. Let me repeat that - You can have virtually everything you want if you work hard and start and/or grow a successful company.

It's that simple. Anyone who falls for Maria the Psychic's scam should be ashamed of themselves.  Success simply does not come without hard work.

I have, unfortunately, seen people work very hard for others and not achieve the success they wanted.  That is why starting your own company is so critical if you have not already done so.

Work hard. Work smart (I consider working "smart" as investing in expert information that allows you to choose and complete your tasks more effectively and efficiently). And most of those 33 wishes WILL come true.


The One Thing You Can't Live Without


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If you're like me, there's one thing you probably take for granted. Interestingly, this one thing is something you can't live without. At least not for long.

But fortunately, there are some cutting-edge entrepreneurs working wonders on solving the challenges of this one thing.

What is it?

Water.

All around the world water shortages long ago crossed the crisis threshold.  In California.  Arizona.  New Mexico. Georgia and Florida.  The Middle East.  China.

Too many years of antiquated public policy, population and economic growth, climate change, and unsustainable agriculture have strained water resources in all of these places to and beyond the breaking point.

The American Entrepreneur to the Rescue

The greater the adversity, the greater the opportunity. And in the dynamic technology landscape of "new water," American entrepreneurs are leading the way. 

A select cadre of under-the-radar water startups are developing game-changing technologies to develop, purify, store, convey, and conserve water.

Meet the Industry Leader

I would like to invite you to an exclusive opportunity to meet, via web conference, the CEO of one of the fastest-growing and innovative water companies in the world.

He will talk about the state of the next generation technologies out there - distributed desalination, nano-particle membranes, energy-efficient reverse osmosis, and demand management.

And he will tell us where the smart money has been going lately, and who stands to profit from the $15 billion the Obama stimulus package targets for water technology and infrastructure investments.

Best regards, and look forward to connecting.

--
Jay Turo
CEO
Growthink, Inc

P.S. To make money in the new business world order, it is imperative to focus on deals and ideas that have a strong, blended public and private sector focus.  You can search the whole world round and not find a technology and a marketplace that fits this description better than water. 


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Jay Turo

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