Growthink Blog

Ask for Advice, Before Funding


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This video will help you raise capital more confidently and quickly.

It's a simple formula, and may sound counter-intuitive, but it's very effective.


 

And if you enjoyed that video, you may be interested in my new online training course, Secrets to Raising Capital, where I give you step-by-step instructions on exactly how to raise 40 different types of capital to grow your business.

Click here to learn more.


Encouraging Startup and Growth Funding News


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Because of all the negative news in the financial markets, this may come as a surprise to many, but last week, over Half a Billion dollars was given to startups and growing companies.

That's right. In venture capital alone, over $200 million was given out. Startups like Ansca Mobile (mobile application firm) and Branders.com (online seller of promotional items) raised $1 million and $5 million respectively.

And early-stage companies like Lanyon (management solutions to the hospitality industry) and Seeking Alpha (financial commentary website) raised $7 million and $10 million respectively.

And the angel market was also booming from coast to coast. Next Big Sound in Boulder, CO (music services) raised $1 million, PBworks in San Mateo, CA (wiki hosting) raised $650,000 and FitnessKeeper in Boston, MA (fitness platform) raised $400,000 among many, many other deals.

And hundreds of other startup and early stage companies raised debt financing and funding from numerous creative and alternative sources.

So, money IS out there. And lots of it.

The key is, as it has always been, to know what sources of financing are right for you and how to get them. 

My brand-new capital raising course - "The Secrets to Raising Capital" - shows you exactly how to do that. 

This 14-week course covers 40 sources of capital. It teaches you what they are; helps you determine which sources (note that "sources" is plural on purpose) of capital are right for your business, and most importantly, gives you step-by-step action plans to raise each one.

Click here to learn more about my new course.  

Growthink Makes Donation to Habitat for Humanity


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As you know, last month we opened the doors to 100 new Growthink University members.

And to make it even more exciting, I offered to donate, from my own pocket, $10 to Habitat for Humanity for every new member. Plus I offered to donate the $1 trial fee that all new members paid.

As you might have imagined, the 100 spots filled up quickly, leaving me with an obligation to donate $1,100.00 to Habitat for Humanity.

So, I wrote the check. And I wrote it with a smile, knowing two things. First, that I was helping Habitat for Humanity succeed with eliminating homelessness. And second, that I was helping the new Growthink University members succeed in building more successful businesses.

Here's a picture of me holding the check:

Dave with Habitat Check

Now, next week, I am going back to raising money. But this time, the tables will have turned. This time I will not be raising money for a charity. This time, I will be raising money for you! To start or grow your business!

That's right. Next week I will be releasing my brand new Capital Raising Course. This 14-session course is the culmination of all of my best capital raising products. It provides step-by-step action plans for you to raise capital from 40 different sources.

Even if you think you only need one source of capital, I will show you how most successful companies raise money from 5 or more sources. And more importantly, I will show you where and how you can raise capital too. And you'll that it's a lot easier than you think - if you follow my directions!

If you haven't already done so, you should listen to my 45-minute long MP3 entitled "The 7 Secrets To Capital Raising Success."

I originally intended to include this audio as part of the Capital Raising course (and charge for it), but I wanted to give everyone access to it, since it's that important.

Click here to download (right-click and "Save As..." MP3 to your computer), or click the blue triangle below in the player below to stream the MP3:


7 Secrets to Raising Capital


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If you're looking for funding to start or grow your business, then you should listen to this.

Below, I'm giving away 7 of my best capital raising tips as a 45-minute long MP3 file: "The 7 Secrets To Capital Raising Success"

Click here to download (right-click and "Save As..." MP3 to your computer), or click the blue triangle below in the player below to stream the MP3:


This MP3 is a preview of my brand-new, in-depth capital raising course, "The Secrets to Raising Capital."

If you want to learn how to successfully raise capital from more than 40 sources of funding, then click here to learn more about the full 14-part course.


Business Creativity: Key Creativity Lessons from Dr. Alan Robinson


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When I was younger, I had four full-time jobs before I started my first business.

Looking back, in none of these jobs did my managers ask for my ideas or suggestions. Nope - my business creativity and ideas simply didn't matter. Even though I had a lot of them. And many were ideas that could have really helped those companies.

So what did I do?

I left. I left those jobs until I found one where all of my ideas would receive the proper attention - running my own company.

But now that I'm running my company, I can't make the same mistake that my past employers made. That is, I must challenge my employees and encourage their ideas and suggestions.

Why? Well for numerous critical reasons according to award-winning author and professor Dr. Alan Robinson who I recently interviewed.

Specifically, according to Dr. Robinson's vast research, 85% of new ideas at companies come from front-line employees. Yes, the employees that are interfacing with customers and vendors, and employees that are manufacturing your products or cleaning your facilities come up with the vast majority of your best ideas.

Which is very interesting and dispels the myth that most great ideas are generated by CEOs and top managers. This makes sense though. Entrepreneurs and founders come up with ideas to form companies. But then they must eventually transform into managers of their organizations. In doing so, they move farther away from the front-line operations, making it harder for them to innovate themselves.

Which is why great entrepreneurs make innovation and business creativity a key part of their organizations.

According to Dr. Robinson, the first key to effectively integrating business creativity, idea generation, and innovation into organizations is "alignment." Alignment simply means that everyone in the organization knows the goals of the organization, and what goals new ideas should aim to solve. In an example of poor alignment, he mentioned the angry CEO who found a note in the suggestion box to "offer different flavors of peanut butter in the cafeteria." Clearly, this CEO, and not the employee, is at fault for not aligning his organization around its key objectives.

The second key to effective idea generation is to establish systems or processes. These systems do not have to be formal or costly. For example, giving employees 30 minutes/week to discuss new ideas is enough for them to 1) know that they should always be thinking of new ideas, 2) that their ideas are valued, and 3) that they have a formal opportunity to discuss their ideas.

Implementing idea generation programs not only results in great new ideas that allow companies to outperform competitors. But they result in dramatically higher employee satisfaction and morale.

In fact, one of the top reasons employees give for quitting a job is that management didn't take their ideas seriously. When employees are asked to submit ideas, given time and/or incentives to submit ideas, and see their ideas implemented, they become much more committed to their organizations and perform better.

So, as you grow your organization, be sure to implement formal processes for business creativity and idea generation. Fortunately these processes are easy to implement, and will have multiple benefits to your bottom line.

In the interview, Dr. Robinson gave some great advice for implementing formal processes for idea generation in your company. He also provided great ideas for assessing new ideas, making sure new ideas don't interrupt the process of implementing existing plans, and dealing with bad ideas, among many other key topics.

To hear a short clip of the interview, click the blue triangle on the player below:



Growthink University members can download the full interview here: http://www.growthinkuniversity.com/members/379.cfm

Private Angel Investors: How to Find & Attract Them


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Not long ago, the sky seemed like it was falling. The Dow dropped to an annual low of 6,547 and the media was forecasting more and more gloom. And those familiar with the venture world were saying that funding was near impossible.

Fortunately, at that same time, the optimists were saying that it was a great time to start or grow a company. And even get funding.

And they were right!

In fact, according to the newest released study by the Center for Venture Research, in the first half of 2009, 140,200 private angel investors funded new and growing companies.

Now, I want to let you in on an extremely important fact -- well less than 1% of these private angel investors are on any sort of list of angel investors that anyone might be trying to sell you.

In fact, most of these 140,200 individuals didn't even consider themselves to be angel investors. But, when discovered and approached correctly, they have the means and ability to invest, and do! (the key is having the knowledge to find and contact them correctly)

So, never listen to the naysayers - that is your first job as an entrepreneur. And realize that if you need funding to achieve your goals, it IS out there.


What Are You Capable Of?


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Imagine for a moment that you were really great at something, but never acted on it.

How would your life, and the lives of others been impacted?

Let's take Michael Jordan. What would have happened if he never picked up a basketball?  What would he be doing today? (I would bet he wouldn't be retired.)  How much wealth would he and his family have lost out on?

Interestingly, a lot of people think that opportunities are lost or squandered when people are young. This is clearly not always the case.

Consider Grandma Moses. Grandma Moses loved painting as a child. But, she and her family didn't consider painting to be a real, paying job, so she spent decades earning a living doing embroidery work.

But, this all changed when Grandma Moses reached her seventies. Her arthritis worsened and she was unable to continue doing embroidery. So, Grandma Moses finally set out to do what she loved - painting.

She went to an Arts & Crafts store, purchased some supplies, and went to work. Within a few years, Grandma Moses would be creating two paintings a week. And each of these paintings would earn her more than she earned in a lifetime doing embroidery. In fact, in her eighties and nineties, she made paintings that would earn her over $300,000 each.

Now let's look at the impact of Grandma Moses' decision to start painting. Financially, she made millions. Money that would help her grandchildren get better educations, get better health coverage and live better lives. She also generated thousands in tax dollars which, among other things, would help fund essential projects. She generated jobs; she must have had assistants who helped her purchase supplies, arrange art showings, and handle her travel and financial affairs.

And then there are the millions of people that Grandma Moses touched by simply allowing them to look at her beautiful paintings.

Yes, even at an elderly age, Grandma Moses made an impact on millions of people.

But what about you and I?

The fact is that each of us have talents. And when we choose to reveal them, and nurture them, and fight to use them - essentially, when we choose to become true entrepreneurs - we positively impact many lives.

Because of this fact, I was not surprised by the Kauffman Foundation's recent study entitled "Where Will The Jobs Come From?" The study reveals clear evidence that "new and young companies and the entrepreneurs that create them are the engines of job creation and eventual economic recovery."

In fact, since 1977, net job creation in the American economy would have been negative in all but a handful of years if not for startups and young companies (defined as < 5 years of age). And even in good times, like in 2007, when 12 million new jobs were added, two-thirds of the new jobs were created by startups.

So, if you are debating starting a business, now's the time to do it. If you have an existing business and are thinking about new growth initiatives, now is the time to launch them.

Yes, now is the time. It's not just about your personal satisfaction. It's about the tens, hundreds, thousands and even millions of lives that you can positively influence with your gift of entrepreneurship. It's time to really put that gift to use.

Consumer Behavior Marketing: Dr. Neale Martin Explains Why You Should Leverage Consumer Habits


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Have you ever driven somewhere, gotten there, and forgot about the last minutes of the drive? You know that you were driving. But your mind must have been somewhere else, since you can't really remember the turns you made, the lights you stopped at, etc.

But, I'll bet that never happens to you when you're lost. When lost, your brain is working overtime to figure out what to do next.

When I recently interviewed Dr. Neale Martin, he explained that the difference in the two situations has to do with which part of your brain you were mostly using. When going on a routine drive, perhaps from home to work or vice-versa, you primarily use your subconscious or habitual mind. But when you are lost, or on the phone while driving, you primarily use your conscious or executive mind.

Importantly, as Dr. Martin lays out in his book "Habit: The 95% of Behavior Marketers Ignore," your subconscious or habitual mind controls the vast majority of human behavior.

For example, when you reach for a carton of milk from the supermarket, do you really think that much about it? Do you compare the different brands of milk and think "maybe today I'll try something new?" Or do you simply pick the same carton of milk you chose last time, and the time before, and the time before. Most of us do the latter.

Understanding these habits is critical to entrepreneurs who want to effectively market their products and services. For instance, once you sell a product or service, you should focus on ways to get the customer to buy again and again from you. According to Dr. Martin, once they buy seven times from you, buying from you becomes habit.

And so they buy again, and again and again. Until you do something like raise your prices or interrupt their service, which causes their executive mind to kick in and consider alternatives.

Likewise, when marketing a new product, you must leverage consumer behavior marketing techniques. Specifically, you need to make sure that your new product jives with people's habits. For example, if people are used to doing something one way, asking them to do it another way, even if that way is better, is oftentimes difficult. Entrepreneurs must make adopting their products and services as easy as possible and ensure that they don't contrast sharply to consumers' habits.

So, the next time you are driving and forget where you are or what you are doing, know that you don't have a Swiss cheese brain. Rather, you are so used to what you are doing that you're relying on your habitual mind. And remember, as a marketer, you must realize that your customers are also frequently using their habitual minds when making buying decisions. So, figure out ways to make buying your company's products and services their habit.

Dr. Martin made tons of great additional points that entrepreneurs can use immediately to become more effective marketers. Specifically, Dr. Martin revealed some great marketing insight and ideas including:

* The key link between emotions and decision-making, and how to leverage this
* How to dislodge customer habits
* The reason why Word of Mouth marketing is so successful
* The importance of getting feedback and the best place to get it

To hear a short clip of the interview, click the blue triangle on the player below:

 

Growthink University members can download the full interview here: http://www.growthinkuniversity.com/members/378.cfm


Improving Your Business Hiring Practices: An Interview with Dr. Geoff Smart


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When Jay Turo and I founded Growthink a decade ago, we each had a ton of responsibilities.

We had to find new clients, serve clients, develop our website, answer incoming phone calls, manage the books, pay receivables, negotiate partnerships, and so on and so on.

Like other successful entrepreneurs, as we grew our company, we knew we had to hire great people. There is no way that Jay and I could have possibly managed everything the company had to accomplish.

In fact, according to management guru Peter Drucker, an entrepreneur must narrow their role as they grow their organizations. The entrepreneur must focus on the areas that provide the most value to the organization, and delegate the rest.

Yes, your ability to determine what to delegate and to delegate to the right people is the only way to grow a successful company. As author Jim Collins states, "the most important decisions that business people make are not 'what' decisions, but 'who' decisions." That is, determining "who" should do the work is absolutely essential to the work getting done right, and the company being successful.

As a result, it's no coincidence that new ventures succeed, or fail, based on the quality of people they hire. It's no coincidence that Apple was so successful with a key early employee like Guy Kawasaki. Or that PayPal was so successful with Steve Chen, Chad Hurley and Jawed Karim as key early employees? (Steve, Chad and Jawed would later found YouTube.)

Simply put, your ability to hire the right people is absolutely critical to your success as an entrepreneur.

In order to teach you how to hire like an expert, I interviewed Dr. Geoff Smart. Dr. Smart is the Chairman & CEO of ghSMART, which helps companies and investors identify the right people to hire to ensure that they can achieve success. He is also the co-author of the current New York Times Bestseller "Who: The A Method for Hiring."

Interestingly, part of his research in conducting his book was interviewing more than 20 billionaires and 60 CEOs, investors, and other thought leaders, so Dr. Smart was able to learn real-world methodologies that allow entrepreneurs like you to hire with precision.

During our interview, Dr. Smart gave tons of actionable information. Some of the highlights included:

1) Tap referrals when seeking new employees: 77% of successful hires come through referrals. That is, by asking your employees and advisors/friends/colleagues who they know that could be "rock stars" in the open position, you can find great talent.

2) Don't just create a job description. Rather than simply creating a job description for your open position, create a "scorecard." Among other things, this scorecard should focus on the desired outcome of the employee. For example, rather than saying that the employee will be responsible for calling on prospects in Indiana, the scorecard must include numeric sales and prospecting goals (e.g., must make 10 to 15 sales calls/day and close $250,000 worth of sales each quarter). Importantly, entrepreneurs should also use the scorecard to judge employee performance after hiring them.

3) Probe in your interviews. Most interviews don't unmask the real information and insight you need to make quality hiring decisions. For example, if a salesperson said they generated $2 million in sales in their last job, it might seem very impressive. But, only by asking the three "P" questions can you really tell if it was. These questions include how the $2 million compared to the Previous year's sales in that territory, how the $2 million compared to the Planned amount of sales, and how the $2 million compared to sales by the individual's Peers.

Dr. Smart made tons of great additional points that entrepreneurs can use immediately to start building stronger teams and achieve more success. In fact, we are in the process of hiring more customer support staff for Growthink University, and will be employing his techniques immediately.

To hear a short clip of the interview, click the blue triangle on the player below:




Growthink University members can download the full interview here: http://www.growthinkuniversity.com/members/376.cfm



Warren Buffet's Advice to Entrepreneurs


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This past Tuesday, Warren Buffett and Goldman Sachs announced that they were donating $500 million to assist 10,000 small businesses in the U.S.

To begin, this is pretty cool. Any money invested in small businesses is sure to lead to more jobs and an improved economy. And even better when this money is not coming from taxpayer dollars.

However, what I found most interesting was where Buffet decided to invest the $500 million. I say "Buffett" and not Goldman Sachs, since Buffett's Berkshire Hathaway Inc. is the largest shareholder in Goldman Sachs, giving me the impression that he was calling the shots on this one.

According to Bloomberg.com, the moneys will be allocated as follows: "$200 million to local community colleges, universities and other institutions to provide small-business owners with practical business education.... $300 million through a combination of lending and philanthropic support to community development financial institutions."

$200 million to "practical business education" - that's what rang out the loudest to me. As one of the greatest investors ever, Buffett knows first hand that entrepreneurs that succeed are the ones who have the right business education and training.

Successful entrepreneurs realize that they themselves are one of their organization's greatest assets. As such, they constantly invest in themselves by taking courses, reading books, and upgrading all of their key skills.

Regarding the other $300 million, it is being provided to community development financial institutions (CDFIs). CDFIs generally provide financing and related services to individuals and small businesses in struggling or underserved communities. If you have or would like to start a business in one of these communities, go to CFDI Coalition website to find a list of certified CFDIs.


Finally, speaking of practical business training, I'm unveiling a brand-new version of Growthink University this week.  

Learn more, here:



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Blog Authors

Jay Turo

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