Written by Dave Lavinsky on Wednesday, January 29, 2014
This blog post was written by Mary Juetten, founder of Traklight.com, a site that provides inventors, creators, and small businesses with integrated software tools to identify and protect intellectual property.
Startups and small businesses are torn when it comes to protecting their ideas. There is a challenging balance between keeping the critical pieces secret and promoting products and services during fundraising – whether with angel investors, venture capitalists (VCs), or crowdfunding platforms.
The NDA question comes up more than you would think because scrappy entrepreneurs are always looking for collaborators, co-founders, and capital while jealously guarding their ideas. At least once a week, I hear one side of this debate or field a question on the topic.
What is a NDA?
Let me first say I am not an attorney (see the disclaimer at the bottom of this article). That being said, a Non-Disclosure Agreement (NDA) is a legal document used to protect ideas, know-how, and other secret sauce under a variety of circumstances.
One standard use of a NDA is protecting one company from another during discussions and negotiations. That means, if I approach Company A to code my software application, I want Company A and all their employees and contractors to keep all discussions about my project confidential. In the same situation, a mutual NDA means that everything Company A discloses about how they will work with me needs to be kept secret by me and my team. If I have a mutual NDA with Company A, I cannot go to software Company B and spill secrets learned from Company A.
As I said, I am not an attorney however I did go to law school (and yes, I graduated but chose to start my company rather than take the bar). The answer to almost every question in law school was, “It depends.” And that is the case here. Requesting and/or insisting upon a NDA depends on the situation. Are you hiring an employee? An independent contractor? Perhaps you are hiring a company for custom work, or are talking to potential co-founders, angel investors, or venture capitalists. Or maybe you are sharing information to collaborate or simply chatting in the grocery line.
NDA for Employees and Contractors
It’s my humble opinion that employees and contractors should be under NDA when you are revealing your know-how during initial discussions. It is purely good business sense to ask for that level of protection. The “I’ll show you mine, if you show me yours” strategy can backfire without a NDA, not to mention these handshake deals are not professional and can lead to messiness (a distraction when trying to start or grow a business).
Please seek professional advice to ensure that your contracts of employment, consulting, operating agreement, articles of incorporation, etc. have the appropriate non-disclosure provisions for your state.
NDAs are questionable for angels; NO for VCs
It is high unlikely the professional investor wishes to steal your idea. The main reason angel investors are reluctant to and venture capitalists (VCs) often refuse to execute a NDA is because they may then be limited in the future from funding similar companies. Another reason is that your company and products may conflict with their existing ventures.
One path forward is to only reveal enough information to interest potential investors while keeping mission critical secrets secret, especially in the first meeting.
No NDA for public pitch or demo competition
Trade secrets are no longer secret if revealed to the public. There is no confidentiality in a public setting, so leave your secrets at home. Disclosure of such secrets may impact the ability to patent here in the US and globally, so be careful in any public pitch, tradeshow, or presentation.
All entrepreneurs understand that the tough part is execution, not idea generation. And to be technical, ideas themselves are not intellectual property. So you need to think of the context of your discussion and what you are trying to protect.
Know your audience. If you have the next great software idea and you are not technical enough to code yourself it is likely a good idea to ask potential co-founders or software companies to sign a NDA before you reveal the details of your idea.
Does that mean you carry the NDA in your purse (or briefcase)? You may but it is mostly applicable for the meeting after your initial encounter. When revealing your secret sauce or business process in public, a NDA is critical.
In conclusion, if someone does not wish to sign a NDA, think of the context, timing, and the person before you walk away. That done, if you have that niggling, uncomfortable gut feeling about why the person will not sign the NDA, head in the other direction.
Visit Traklight and use “ID your IP” with Traklight’s compliments until February 28, 2014. Remember, you cannot protect something if you do not know you have it! Free “ID your IP” Code GROWT13 ($59 value).
Disclaimer: This article is intended to be general information and nothing in this article constitutes legal advice. Please consult with an attorney before making any intellectual property or other legal decisions.
Written by Dave Lavinsky on Sunday, June 2, 2013
Typically when I ask entrepreneurs and business owners what their number one challenge is, they reply that it's getting new customers.
And one specific question I often get is which are the best ways to generate new leads and customers? Certainly there are many tactics to choose from: direct mail, radio advertising, referral programs, and so on.
Particularly over the past decade, smart businesses have learned that one of the easiest and most cost effective ways to generate new leads is going online.
Two of the benefits of online lead generation are that it's quick and inexpensive. As you can imagine, it could take a month or more and several thousands of dollars to produce and run a radio, TV or print advertisement. Conversely, you can literally start generating leads online within an hour and with a budget of less than $100.
However, in my opinion, the real beauty of online lead generation is the metrics: you can track everything extremely closely to tell precisely how much money you spent, and calculate your return on investment.
On the other hand, traditional advertising like television, print and radio are much harder to track. For example, it's very hard to accurately tell if a new customer came to you from a print ad or a television ad, and it's even harder to tell which ad they responded to (e.g., the ad from newspaper A or the ad in newspaper B).
So, let me give you some tips and steps for creating an effective online lead generation campaign.
The first step is to determine what a lead is worth to you. For example, is a lead (for now, let's define a "lead" as someone who visits your website) worth 10 cents to you? 25 cents? 5 dollars?
Clearly, you need to understand what leads are worth to you, so you can generate leads at a lower cost than that amount.
So, how do you determine the value of your leads? The answer is to know, track and constantly improve your conversion rates. Conversion rates refer to the percentage of website visitors who take the actions you desire.
For example, let's say that for every 100 visitors that come to your website:
- 3 buy one of your products or services from your website
- 4 fill out your contact form
- 2 email you
- 6 call you
In this example, 15 visitors took a desired action; or you had a 15% overall conversion rate. And your conversion rate on buying online was 3%, on filling out the contact form 4%, and so on.
The next step is to determine how much each of these conversions is worth to you. For example, let's say:
- Your average product or service sale on your website generates $50 of gross profit
- 25% of people completing your contact form eventually buy from you at an average gross profit of $100 each
- 50% of people who email you eventually buy from you at an average gross profit of $75 each
- 33% of people who call you eventually buy from you at an average gross profit of $150 each
In this example, for every 100 visitors, you would generate $625 in gross profit as follows:
- $150 in gross profit from online sales
- $100 in gross profit from contact form conversions
- $75 in gross profit from email conversions
- $300 in gross profit from telephone conversions
Which means that every visitor to your website is worth $6.25. And as long as you can drive visitors to your website at less than this amount, you will generate profits.
Importantly, as mentioned above, not only must you know your conversion rates, but it is critical for you to continue to test and track to improve your conversion rates. For example, by changing the layout of certain pages of your website, you could boost overall conversions by perhaps 25%. This would mean that the average value per visitor to your website would jump from $6.25 to $7.81.
Not only would this jump allow you to boost profits, but it would enable you to outspend your competitors and advertise in places where they can't (since they perhaps generate only $5 per visitor). This is how you can truly dominate your market.
So, let's discuss where you can generate leads online. Here are my five favorites:
1. Search Engine Pay Per Click Advertising: Via pay per click advertising networks Google AdWords and Bing Ads (which covers ads on Yahoo and MSN), you can reach millions of web surfers. While many advertisers lose money with this method, if you know your metrics and improve them, you can make a killing here.
2. Social Media Marketing: You can drive lots of traffic to your website using social media sites such as Facebook, Twitter, YouTube, Pinterest and/or LinkedIn.
3. Social Media Advertising: Some social media sites such as Facebook, LinkedIn and more recently Twitter have specific advertising programs to allow you to attract their members and drive them to your website.
4. Online Media Buying: Online media buying is purchasing ad space on desired websites. Unlike pay per click advertising where you pay each time someone clicks on your advertisement, media buying is typically charged on a CPM or cost per thousand basis. That is, you pay every time a visitor sees your ad, regardless of whether or not they click on it. The key is to find the sites on which your target customers are spending time.
5. Search Engine Optimization: Search engine optimization (SEO) is the process of getting your website to be listed at the top of the search engine results for your most desired keywords and keyword phrases. Gaining top positions on certain keywords can drive hundreds, thousands, and even hundreds of thousands of leads to your site each week. However, SEO results do not happen overnight; you need to have a strategy in place and invest in this lead generation technique.
I want to mention a key point here. You are more likely to be successful if you focus on doing an excellent job executing on just ONE of these five tactics, rather than doing an average job executing on ALL five tactics. So, my recommendation for you is to start with just one tactic above and gain success. Then you can start to add the other tactics.
And finally, when marketing online, it's important that you have a lead nurturing process in place. Specifically, not every visitor who comes to your website is ready to buy right away. So, make sure you have processes in place to capture those leads (perhaps by offering a free report or video in exchange for their email address), and then send emails to them to nurture and maintain your relationship with them over time. Because when you nurture them, when they are ready to buy, they will most likely buy from you as they know and trust you more than the competition.
Suggested Resource: Want unlimited online leads? And want a proven step-by-step system to get them. Check out our Ultimate Internet Marketing System to learn how you can build the ultimate online lead generation machine. Click here to learn more.
Written by Dave Lavinsky on Tuesday, September 28, 2010
On Monday, President Obama signed the Small Business Jobs Bill. The bill provides $42 billion in loan incentives and tax cuts for entrepreneurs and small businesses.
Specifically, the Bill does a few important things:
1. The Bill increases the government guarantee on the SBA’s 7(a) loans to 90% through December 31.
Some explanation for some of you who are new to raising funding:
The SBA is the United States Small Business Administration. The SBA doesn’t lend money to entrepreneurs. Rather, local banks give out the loans, but the SBA guarantees a certain percentage of the loan amounts (so if the entrepreneur defaults on the loan, the SBA pays the bank 80% to 85% of the loan amount). With the new program, the guarantee is being raised to 90% which makes lending less risky to the banks.
The SBA’s 7(a) Loan Program is its primary program “to help start-up and existing small businesses obtain financing when they might not be eligible for business loans through normal lending channels.”
2. The Bill includes a new $30 billion lending fund that community banks can use to make loans to entrepreneurs and small businesses.
3. The Bill includes $12 billion in tax breaks for small businesses.
Overall, this is great news to entrepreneurs and small businesses who gain 1) more access to funding, 2) better funding terms, and 3) tax breaks.
This is also positive news for the US economy, as entrepreneurs and small business owners have historically created the majority of jobs and job growth in our country.
(Note: Want to tap into this new funding from the Small Business Jobs Bill? Growthink’s Step by Step Guide to Raising Capital From Banks and SBA Lenders will teach you how to quickly and easily get the right SBA and/or bank loan to fund your business.)
Written by Dave Lavinsky on Monday, July 12, 2010
I talk to a lot of entrepreneurs.
Which I love to do. I love hearing cool, new ideas. I love hearing the passion. And I love figuring out how I can help them successfully go from point A to point B.
But one thing that frustrates me is seeing entrepreneurs making the same mistake over and over and over again.
And the biggest mistake I see is a lack of focus.
This lack of focus is best summed up by the ancient Chinese proverb -- “man who chases two rabbits catches neither.”
In other words, if you try to pursue two entrepreneurial ideas, both will most likely elude you.
And I hear this all the time. Budding entrepreneurs telling me about their great idea. And then a moment later saying, “Oh…I have one other idea that I’m working on that I need to tell you about.”
I don’t usually say the Chinese proverb here, but I give my own line. Which is, “If you try to do 2 things, maybe you can do a B+ job at both. But in today’s competitive market place, you need to do an A or A+ job to succeed. And to do that kind of job, you need to focus on just one opportunity.”
The Chinese version is better.
As an entrepreneur, you are inherently creative. If you haven’t launched your first venture, you must pick just one opportunity. Brainstorm and write down all of your ideas. And then judge them and figure out the one you want to pursue.
And once you decide you want to pursue that idea, forget the rest. Use all your creativity and brainstorming power on that one idea. Use it to figure out creative marketing plans, unique financing ideas, and ways to best lead your organization.
Entrepreneurs by definition work in a resource constrained environment (if resources weren’t constrained, the entrepreneurs would be the CEO of a Fortune 500 company). So, when resources are constrained, you can’t possibly divide the few resources you have into multiple opportunities. Rather, you absolutely must focus on just one opportunity, and put everything you have into achieving it.
So, make sure you focus all of your efforts on just one opportunity. And once you achieve success with that opportunity, you can focus on your other ideas and opportunities.
Written by Dave Lavinsky on Friday, July 9, 2010
Last weekend, friends of ours invited me and my family to their country club.
It was a beautiful club, and unlike other clubs in the area, had a big lake where everyone swam.
But immediately after gazing at the beauty of the lake, something else caught my eye.
An old high diving board. I mean a really high one.
I knew my kids saw it too, so I turned to see their reactions.
My 8-year old daughter had a very calm reaction; for there was no way in her mind that she was going to jump off the board.
My 10-year old son, on the other hand, looked excited and nervous at the same time. Since he was already contemplating his dilemma.....jumping off it would be fun...but really scary.
As entrepreneurs, jumping off the high diving board is something we must do quite often. Sure, we are not physically climbing up a ladder and jumping into a pool of water. But we must often do things that are out of our comfort zone if we want to succeed.
What are some of these entrepreneurial “high dive” moments?
1. Starting your business plan. The first step in starting a business is always the hardest. It’s committing to yourself that you’re really going to go out on your own. Most folks dream about having their own company. But the first real step is putting your business idea down on paper as a business plan. (Note: for help with your business plan, watch this video.)
2. Getting advisors. When I interviewed Dr. Basil Peters, he told me that getting mentors and advisors is an entrepreneur's most controllable success factor. Yet, many entrepreneurs are afraid to find and ask advisors for help. Maybe it’s the fear of uncovering what we don’t know, or the fear of people we respect disagreeing with some of our ideas or assumptions. But if you want to succeed, you need these expert opinions and guidance.
3. Talking to customers. Many entrepreneurs don’t speak to their customers early enough. They come up with ideas that they think will work. But they don’t ask prospective customers if they will buy the products. Likewise, even when entrepreneurs successfully sell to customers, they are often fearful of asking for referrals.
4. Meeting with investors. A final entrepreneurial “high dive” moment that I wanted to mention is meeting with investors. This legitimately can be very frightening…it’s scary when you’re telling others about your entrepreneurial baby who have the ability to make (by funding you) or break you (by not funding you). Worse yet is the potential of the investors to be totally under-whelmed by you and/or your idea to an extent that you have to go back to the drawing board. (Note: to make sure you make every investor meeting a success, watch this video.)
As Franklin D. Roosevelt said in his first inaugural address, “The only thing we have to fear is fear itself.” So jump off that high dive board, and achieve the success you deserve.
And as for my son….his first trip up the high dive ladder was slow and methodical. Then he stood at the edge of the board and thought for a while before his first jump.
After the jump, everything changed. When his head first emerged from the water, he had an enormous smile of joy, satisfaction and pride that he had faced his fears. And he must have gone off the diving board 20 more times after that!!!
Written by Dave Lavinsky on Wednesday, July 7, 2010
My 10 year old son and 8-year old daughter tend to get along pretty well.
But, there's still times where they're at each others' throats.
The other day was one of those days.
So, my wife and I used our usual plan - divide and conquer.
The divide and conquer plan is pretty simple. She takes one of the kids. And I take the other.
The fighting stops instantly as our kids are separated, and each of our kids gets one-on-one time with one of their parents.
Now, even though we prefer to do things as a whole family, the plan works great. And either later that day, or the next day, we'll regroup and do something as a complete family.
The divide and conquer plan can also be used in your business. For example, clearly there are times when your whole company should meet to form company-wide bonds.
But many other times, you, as the leader, should divide. For example, you should spend time just with your marketing team. That team will then feel special. They will not be jockeying for attention against other parts of the company.
And you can use this time to really focus on that one area. To improve it. To set metrics for the team to perform against.
The leaders of sports teams divide and conquer all the time. A typical professional football coach will do lots of drills with his complete team. And then, like a business, will separate into functional areas led by specific coaches; like the linebackers coach, the wide receivers coach, the quarterbacks coach, and so on.
And then the head coach will circulate among each of these functional areas to add value, support them, and make sure they are getting in position to help the entire organization perform the best it can.
Divide and conquer is also a great technique if your business faces multiple challenges. It is typically most effective to overcome one challenge at a time. While multi-tasking often makes us feel that we are being productive, it often backfires with key tasks not getting done as quickly as they should.
So make sure that you constantly divide or separate your business challenges and functional areas, and conquer or devote the required time to nurture and solve them.
Written by Dave Lavinsky on Monday, June 28, 2010
Last week I was finishing up the development of a new money raising product about Crowdfunding (an extremely exciting new way to fund any company).
I wanted to have a logo designed for the product, so on a friend’s advice, I decided to try Hatchwise.com.
Hatchwise.com is very cool. You go to the site and set up a “contest” to get your logo designed. It asks you a few basic questions (name on your logo, what the product/service is, who your target audience is, etc.) and then your contest begins.
The contest works like this: graphic designers from around the world read your design brief (the questions you answered) and submit logos to try and win your contest.
What's so cool is that you get to see the designs before you select the final designer and pay for it. So you know exactly what you are getting first. And you typically end up seeing lots of interesting designs.
You can see a sample of the logos that were submitted in my contest below. Click here or on the image to go to the full page on Hatchwise.com.
Now what I also really like about Hatchwise is that in addition to graphic design projects (which can include logos, websites, brochures, etc.), you can use it for NAMING new products.
Specifically, if you have an idea for a company name or a product/service name, you can submit the general idea to Hatchwise, and members will submit to you potential names and logos. And, they’ll even make sure the domain names are available for you.
This is really cool.
But, the last part (making sure the domain names are available for you) is something I want you to be aware of as this is where I got burned.
You see, if you look at my design contest again, you’ll see that the name of my Crowdfunding product WAS Crowdfunding Secrets.
Well, when I soon launch that product, it’s not going to be called Crowdfunding Secrets. That’s because, I didn’t decide to reserve the domain CrowdfundingSecrets.com until a few days AFTER my contest.
And what did I find? Someone who had seen my contest reserved that domain so I either had to pay them a premium to buy it or not use it.
Fortunately, the buyer/domain squatter probably didn’t even know what Crowdfunding was or realize that Crowdfunding is a brand new field.
So, there’s tons of Crowdfunding domains to choose from (so I just changed the product name to Crowdfunding Formula and the domain to CrowdfundingFormula.com).
But I want to make sure you understand this lesson – if you post anything about your future products or company online, make sure you have already reserved any domain names you may want. Because someone else could steal your name from you.
Not cool…but it happened to me…
Written by Dave Lavinsky on Thursday, June 24, 2010
Look at this picture:
Those are pretty big smiles don't ya think?
Well, those are my kids. And the reason they are smiling so much is that today is their last day of school.
Do you remember how you used to feel on the last day of school. I do. I clearly remember how good it felt. Knowing that I was done with whatever grade I was in. And that I had the long, fun summer to look forward to.
So, why am I telling you this?
Because I want you to think about the last time you felt this way in your business.
When was the last time you were really excited after accomplishing a goal. Enough so that you really celebrated and relaxed for at least a day or two after accomplishing it.
As an entrepreneur, too many times it's go go go.
We must all slow down sometimes to enjoy life. We need to enjoy the journey of becoming a successful entrepreneur.
To do this, you need to constantly be setting goals for yourself. Annual goals, quarterly goals, monthly goals, weekly goals and daily goals.
And for certain goals, after you achieve them, you should reward yourself.
Sometimes the reward might be as small as giving yourself a coffee break or a piece of candy.
At other times, a weekend away or a day off makes sense.
But you must achieve pre-set goals, and you must reward yourself. That makes the journey fun and enjoyable. And it ensures that you continue to make progress towards completing your journey and entering the land of the outrageously successful entrepreneur.
A fair portion of “Productivity Secrets for Entrepreneurs: How to Get More Done, Make More Money and Take More Time Off" discusses the importance of goal setting and rewards for you and your employees. It teaches you to set the right goals and achieve a whole lot more. Learn more here.
Written by Jay Turo on Monday, June 7, 2010
When I started Growthink over a decade ago, I thought I knew more about management then I did.
One of the things I clearly did wrong was running meetings. Looking back, it pains me to think of the literally hundreds of hours lost on inefficient meetings.
Fortunately, over the years, my team and I have read and tried pretty much every technique for making meetings more efficient, and boiled it down to just 8 essential rules.
Following them will make you and your team MUCH more productive. Here's my list of the 8 rules:
1. Start on time. If 3 people wait an average of 2 minutes per meeting for the fourth to arrive, that adds up to hours of lost productivity over the year. It's also extremely frustrating, and starting a meeting in a state of frustration kills creativity.
2. Have a written agenda. Ideally circulate your agenda 24 hours in advance of the meeting so that you and all the participants are as prepared as possible.
3. Everyone must participate. In meetings you want to encourage all viewpoints so you can make the best decisions. So get everyone involved.
4. Stick to a schedule. The entire meeting and each agenda item must have a time limit. If an individual agenda item goes long, revisit it at the end of the meeting (if there's time), or schedule another meeting to discuss it. The discussion for each agenda item should end only when specific action item(s) have been determined, written down, and assigned.
5. Stay on topic. While it's ok to go off on an occasional tangent, you must guide the discussion back on topic. The agenda and time limits will help with this.
6. Don't hold unnecessary meetings. If you have trouble creating the agenda (in that there's nothing too important to discuss), it might mean that you shouldn't hold the meeting in the first place.
7. End meetings with complete clarity regarding the key action items and who will complete them. This is key. Coming up with great ideas during a meeting is meaningless, unless those ideas are documented and assigned to individuals to execute on.
8. Improve. Every five or ten meetings, get feedback from your group regarding ways to improve how your meetings are run.
These 8 rules will make your meetings more productive, and you and your team will accomplish much more and be much more successful!
For tons of other productivity tips and tactics, check out my Productivity Secrets for Entrepreneurs here.
Written by Dave Lavinsky on Monday, June 7, 2010
I have two close friends that are very much alike.
They both grew up playing the same sports. They both look fairly alike. And they both went to the
same college and got nearly the same grades.
But one of them is now wildly successful, while the other is still sort of just getting by.
I had my hunch regarding why they have achieved such different outcomes in their careers. But it wasn't until the other day, when I picked up "The Luck Factor" by Richard Wiseman, that the difference became crystal clear.
In his book, Wiseman described an interesting experiment.
In the experiment, a researcher filmed two people, Martin and Brenda. Both had volunteered to participate in a study, even though they didn't really know exactly what the study was about. Prior to the study, Brenda described herself as an unlucky person. On the other hand Martin considered himself an extremely lucky person.
Both Martin and Brenda were sent to a coffee shop and told to wait for a researcher to arrive. The research team put a $5 bill on the ground in front of the shop. Martin saw the bill, picked it up, went in, sat down at the counter, and had a nice conversation with a businessman sitting there (who was actually the researcher).
Brenda, on the other hand, failed to notice the bill, stepped over it, sat down next to the businessman and did not say a word.
After the experiment was over, the researchers interviewed both Martin and Brenda. Specifically, the researchers asked each if they thought anything lucky or unlucky had happened
to them that day.
Martin was thrilled about having found the money and about his nice conversation... while Brenda described her day as uneventful.
What's so interesting is this: Both Martin and Brenda had the SAME EXACT OPPORTUNITY, but only Martin, who started the day feeling lucky, enjoyed and got value from it.
The point is this: How you feel about yourself, be it lucky or unlucky, WILL shape your success. Particularly your success as an entrepreneur. Because feeling lucky allows you to better see and act upon opportunities.
Importantly, the author's research found that luck has nothing to do with mere chance. And studies show that lucky people cannot predict good fortune, like winning the lottery, any better than unlucky people.
Also, people who consider themselves lucky do not score higher on IQ tests than unlucky people. And they are less superstitious than "unlucky" people.
But lucky people expect their lives to be full of luck, and are thus always on the look-out for more. They don't see setbacks as final outcomes. Rather, they look for opportunities and start working optimistically again toward positive outcomes.
And importantly, the author believes that with commitment and steady work, anyone can retrain their thinking and habits to improve the quality and quantity of luck in their lives.
I would venture to guess that virtually all successful entrepreneurs consider themselves to be very lucky. More importantly, I bet that BEFORE they became successful entrepreneurs, that they considered themselves to be very lucky. Because you must be able to see opportunities and act on them in order to be successful.
So, if you find yourself thinking negative thoughts, zap them. Everyone has obstacles to overcome en route to entrepreneurial success. Know that you can overcome your obstacles and achieve
If you want personal mentoring from me and my senior team to overcome any obstacles you face, and to successfully capitalize on opportunities, join Growthink University today.
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