The 5 Biggest Outsourcing Blunders


 

The term "outsourcing" describes contracting out of a business process to a third-party, that is, someone or some firm outside of your core organization.

Outsourcing generally refers to ongoing processes versus one-time processes. For example, the development of your website is generally a one-time process. Conversely, the maintenance of your website is an ongoing process. However, some people consider both one-time and ongoing processes to be outsourcing when you select someone outside of your organization to complete them.

Regardless of your definition, outsourcing has many benefits, my favorite of which are these four:

1. Focus: Outsourcing allows you to focus on your core competencies and activities. For example, if you own a chain of restaurants, you generally don't have (nor should you) the skills to develop a cutting-edge website in-house.

2. Cost Savings: You can often outsource to individuals and firms in areas with lower costs of living and thus lower prices than you can attain in-house.

3. Expertise: When outsourcing to individuals and firms who specialize in a certain area, they will have expertise that you simply don't have.

4. Flexibility: Outsourcing allows you ramp up and/or ramp down more quickly than maintaining a full-time staff for all functions.

Unfortunately, when they start outsourcing, most entrepreneurs and small business owners make several mistakes. Below are the 5 most common ones to avoid.

Mistake #1: Failing to define tasks/projects clearly


If you don't clearly and comprehensively define the task or project you need fulfilled from the start, your project will inevitably fail. You might choose the wrong person for the job and/or they won't perform to your expectations if you haven't completed this crucial step.

Mistake #2: Failing to hire someone without enough experience


Nothing is worse than the blind leading the blind. When I hire someone to do something that I do not know how to do personally, they need to know how to do it. They need to educate you on their chosen skill set, not the other way around.

Your role is to describe the end result you want, ask for and listen to their suggestions, and rely on their expertise and talent to achieve it according to your description. Make sure you check their past work and references to ensure they have a track record of getting similar work completed on-time and to the satisfaction of those who've hired them.

Mistake #3: Failing to establish and abide by the timeframe

If you've ever provided services for a client in a rush, you know how stressful it can be to drop everything at the last minute and make their emergency yours. The people you outsource to are no different, and it will benefit you to plan and begin things in advance and not at the last minute.

So, map out by when you need to hire someone, when the work needs to commence, and when it must be completed. Create milestones within each of these processes, such as by when you will complete your project description, and when the contractor must complete the first draft, etc.

Mistake #4: Failing to adequately communicate

Just because you hired a great person, it doesn't mean the project will go smoothly. The key here is to effectively communicate with them.

Make sure you check-in with them and get status updates. Get them to send you drafts of their work, and then provide detailed comments regarding what you like and don't like.

The fact is that the more and more thoroughly you communicate with them, the better they will perform. This is true up to an extent of course; because if you micro-manage (or manage too aggressively) it will take up too much of your time and often aggravate the contractor.

Mistake #5: Failing to leverage talented outsourcers


Once in a while, when you outsource, you will find gems. Gems are those outsourcers who do a phenomenal job.

The key is this: once you find these gems, keep them. Give them additional projects. And if you don't have any, refer them to others you know. And keep in touch. At a minimum, email them every month or two to say hi.

In fact, I've had amazing success with just this. I hired an outsourced tech person on August 16, 2005. He did a phenomenal job. I've often kept in touch since then, and he's helped me with several projects. And even though he now has a full-time job (he's in India), he still helps me on the side a lot. And he still does a great job each time!

Knowing how to effectively outsource is a critical skill all entrepreneurs must have. It allows you to accomplish more, accomplish it with more expertise, accomplish it faster, and accomplish it with less money. These are key benefits you can't do without.

 

Suggested Resource: In today's competitive business environment, you must outsource to stay competitive. Outsource the right way using Growthink's Outsourcing Formula.

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Strategic Plans And Business Plans: 5 Key Differences


 

Over the past 15 years, I've helped over 500,000 entrepreneurs and business owners to develop their business and strategic plans.

And, as you might imagine, I've spent a lot of time discussing business plans and strategic plans internally. Enough so that among other things, I use the acronym "BP" for business plans and "SP" for strategic plans.

Now, because these terms are often used synonymously, let me explain the key difference as I see them. Business plans or BPs are plans created for the primary goal of convincing an investor or lender to fund you. Conversely, strategic plans or SPs are developed to determine and document your strategy so your company understands and can attain its objectives.

As you can see, both plans serve very different and very important purposes.

Below are the 5 key sections that a strategic plan must have that need not be included, or require much less focus, in a business plan.

1. Elevator Pitch

An elevator pitch is a brief description of your business.

It is included in your strategic plan since your elevator pitch is both important to your business' success, and should often be updated annually.

An elevator pitch got it's name because you need to be able to describe your business succinctly and within the time it takes to travel from the ground to the top floor in an elevator.

A quality elevator pitch:

  • Gets everyone in your company on the same page regarding what your business is and what the key objectives are.

  • Allows everyone in your company to give a concise and consistent explanation of your business which leads to more customers.


In a business plan, you do include your elevator pitch in the Executive Summary section to concisely explain your company to investors and lenders. In your strategic plan, it is used to ensure consensus within your organization.


2. Company Mission Statement


A mission statement explains what your business is trying to achieve.

For internal decision-making, it helps as key decisions should be made with regards to how well they help the company progress in achieving its mission.

Also, for internal (e.g., employees) audiences, the mission can inspire and get them excited to be part of what the company is doing.

While your mission statement is often also included in your business plan, investors and lenders are generally more concerned with your ability to earn them a return on investment. As such, it's not as heavily emphasized in your business plan.

Some great examples of mission statements include the following:

  • Google's mission is to organize the world's information and make it universally accessible and useful.

  • Kiva's mission is to connect people, through lending, for the sake of alleviating poverty.


3. Goal Specificity

Because your strategic plan focuses on setting your company's vision and getting your team to execute on that vision, your strategic plan must include a greater focus on your goals than your business plan.

While your business plan focuses more on your long-term goals, your strategic plan is more granular. Specifically, your strategic plan should lay out your company's 5 year goals, 1 year goals, and your upcoming quarterly and monthly goals.


4. Key Performance Indicators (KPIs)

As the name indicates, your "KPIs" or Key Performance Indicators are the metrics that judge your business' performance based on the success you'd like to succeed.

Identifying and measuring your KPIs is absolutely critical to ensuring you are effectively executing on your vision and plans. Conversely, if you don't measure your KPIs, you have no idea whether you are achieving the success you desire.

In your strategic plan, unlike in your business plan, you must identify the KPIs your business must track in order to achieve your goals.


5. Identification of Required Strengths


In your business plan, you should stress your existing strengths that make your business uniquely qualified to succeed. This helps convince investors and lenders to fund you.

Conversely, in your strategic plan, you must identify the strengths you need to develop. For example, how could you gain competitive advantage by modifying your products or services? Or by hiring and training certain personnel? Or by creating new operational systems? Etc.

By asking and answering these questions in your strategic plan, you can create a strategy for building a rock solid company that's the envy of your industry.

To summarize, the right business plan allows you to raise money to fund your business' growth. The right strategic plan gives you and your team the vision, goals and game plan to achieve this growth. Finally, using the right strategic plan template helps you create your strategic plan quickly and easily so you can start growing immediately.

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10 Real Profiles of Angel Investors


 

There are hundreds of thousands of individual or "angel" investors in the United States (and many more throughout the world). This is many, many times greater than the mere 6,000 members of angel investor groups.

And here's the key: the vast majority of these individual investors are what I call "latent angel investors." That is, they have the interest and ability to make an angel investment. But they don't actively seek to make angel investments.

Basically, you have to find them and pitch them, since they aren't actively seeking entrepreneurs to fund. And in most cases, they've never before invested in a private company.

So, who are these "latent angel investors?" The short answer is that they are people with money. I sat down this morning and wrote brief profiles of some the angel investors that have funded some of Growthink's clients. Here they are (I changed the people's names for privacy reasons).

1. Roger is a lawyer.

2. Alan is an executive at a large consulting firm.

3. Bill is the COO of the US branch of a multi-national corporation.

4. Allison is a restaurant owner.

5. Randy owns a small consulting firm.

6. Catherine is an executive at a large financial services company.

7. Robert used to run his own business and is now retired. He does some consulting on the side.

8. Victor is from Europe. He attended business school in the United States. He now has business ventures throughout the world including one in the United States.

9. Josh is a super successful entrepreneur in his early thirties. He had a lot of success in his first venture, and continues to launch new companies.

10. Richard is a retired executive from a Fortune 500 company.

Here's some additional info: All but two of these angel investors are between the ages of forty and sixty five. All but three of them live within 20 miles of the companies they funded. And of the three, two live within an hour's flight or 3 hour drive.

The key lesson here is this: potential angel investors are all around you. They are current and retired doctors, lawyers, executives, business owners and otherwise successful people with money (interestingly, none of my current clients have doctors as investors that I know of; although doctors are very common angel investors).

Yes, there are specific ways to contact and present your venture to these investors that I explain in my Angel Investor Formula, but the key is to network, network, network. Don't be shy. Rather, start telling people about your venture and get referrals to people with money that could invest in your company.

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5 Rookie Business Plan Mistakes to Avoid


 

When developing their business plans for investors and lenders, there are lots of mistakes that entrepreneurs make. Here are the 5 biggest:

1. Forgetting that Your Business Plan is a Marketing Document


On of the key goals of your business plan is to convince lenders and/or investors to fund you. As a result, you need to think of your business plan as a marketing document.

In brief, think of your business plan as a brochure versus a product manual. A brochure gives high level features and benefits and gets people excited. Conversely, a product manual provides tons of details (which are often boring) and is generally hard to read.

Use your brochure/business plan to excite the reader so they agree to meet with you. During the meeting, you can provide additional details they want to know.

2. Failing to Prove Your Case


The second common business plan mistake is not adequately proving your case. Just like a lawyer has to prove his or her case, your business plan should prove the case as to why an investor or lender should fund you. There are two key ways to do this.

First, show why you are uniquely qualified to succeed in your business. For example, maybe you and/or your management team have unique expertise and experience. Or you have a unique and patented product. Or maybe you are first to market. Or maybe you have already secured critical strategic partnerships. Identify these key reasons and include them in your plan.

Second, include market research that proves your ability to succeed. For example, show how big your market is. Show how market trends support (or at least don't hurt) your business' success prospects. Detail who your customers are and their needs. And show you understand who your competitors are and their strengths and weaknesses.

3. Not Clearly Describing Your Business at the Start


Too many business plans fail to clearly describe the business at the very beginning of the plan. This is a critical mistake, because if readers are confused after the first paragraph, they often won't continue reading.

So, rather than starting your plan with a long story, start by clearly describing what your business does so readers "get it." Then, you can explain why it will succeed, the origins of your idea, etc.

4. Using Lots of Superlatives

Using too many superlatives turns off most investors and readers, and when unsubstantiated, hurts your credibility.

Specifically, avoid superlatives like "best," "greatest," "most powerful," etc., unless you can back them up. For example, saying that you have the "best management team" will turn off many investors.

Rather, you should say something like, "our management team has the experience, skills and track record to successfully execute on our plan. Among other things, our management team has [and then list the credentials of your team]."

5. Trying to Answer Every Question

The final mistake that most entrepreneurs make in their business plans is trying to answer every question in them. The solution, rather, is to answer the key questions, but not all the questions.

Similar to the above mention of how your business plan should be like a brochure, your plan should not answer every conceivable question readers might pose.

Rather, answer the big questions that will get readers excited about your venture, proves you really understand it, and influences them to invest more time meeting with you to discuss further.

During the meeting you'll have the opportunity to fill in the details, which are often different for each potential funding source.

Avoid these five mistakes in developing your business plan and you will have much more success completing your plan and using it to positively influence funding sources.

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5 Situations That Kill Businesses and How to Avoid Them


 

Every successful business requires a lot of planning.  From market research to internal corporate structure, the planning stages of starting and growing a business can be quite extensive.  While this preparation is a key factor in the success of any company, there are a few things which far too many business owners neglect.  Planning for success and growth is important, but smart businesses are also prepared for the worst case scenario.

Situation #1: Disability

No matter what a business may do, if it has employees then it needs to consider disability insurance.  Accidents happen every day and they are not restricted to those jobs which would traditionally be considered dangerous.  Even in an office environment, for example, there is a potential for an employee to be injured (perhaps outside of their work activities).

When an employee is injured while on the job, the company may be personally liable for medical bills and worker's compensation payments.  This is why disability insurance is so vital.  If something like this should happen, the insurance will cover any bills and fees for which the company will be responsible.

In addition to insurance, a smart business owner will spend time on succession planning.  There is no telling who might be injured and it is entirely possible that this person is the business owner. 

What will you do if you cannot run your business - temporarily or longer term?  Do you have the right disability coverage to protect your income?  Do you have people who are trained and familiar with different parts of the business so they can be called upon to pick up where you left off?

Situation #2: Natural Disasters


One thing which can rarely be predicted is a natural disaster.  Regardless of where a business is located, there is the possibility of one natural disaster or another.  Whether it is earthquakes, floods, fires or tornados, these disasters can literally destroy a company.

This is why disaster insurance is so important.  It may seem unnecessary to pay for insurance for something which might never happen but, when it does, this insurance will be the difference between a temporary setback and total destruction.  Smart business owners need to know what types of disasters are possible and find insurance which covers them completely.

No, this article is not about promoting insurance. It's about making sure you have the protection you need to keep your business operating and your income flowing. 

While disaster insurance will help cover the financial aspect of such a catastrophe, contingency planning is equally as important.  Rebuilding a business can take months and work should not stop during that time.  A good business owner will have a contingency plan set up which allows the company to continue, even if an entire physical location was lost. 

When reasonable for the business model, redundant operations, back-up equipment, data back-up, and/or employees/contractors in other geographical areas are critical components to recovering from and/or minimizing the impact of a natural disaster.   

Situation #3: One Revenue Stream

One of the biggest mistakes many businesses make is relying too heavily on one customer or revenue stream.  Most companies will work with different clients and customers, but may rely on one specific client for the majority of their revenue.  The problem here is that the loss of this client can mean a sudden loss of the majority of a company's revenue.

Just as anything can happen to a business, the same can happen to clients and customers.  Relying too heavily on one specific source of revenue is a recipe for disaster.  Smart business owners will focus on diversifying their revenue sources and creating a situation where the loss of any one source only represents a small loss of overall income.

If you don't have the resources to handle more clients, create a client back-up plan.  What accounts or work-streams can you quickly put into action if you lose your main client? If diversifying pushes to outside of your production capacity, always have other work lined up to fill any vacuums.

Landing a big client may make you feel like you can take a break from marketing and customer acquisition.  But beware of this false sense of security.  Every day, dozens of businesses, from small to multi-national corporations, close their doors because they lost their main account.  Remember the old adage; don't put all your eggs in one basket.

Situation #4: Data Loss


We live in the information age and nearly every business relies heavily on stored data.  This can include, among others, payroll records, inventory systems, emails, documents, and even client contact information.  This data can be so important to the success of a company that the loss of it can be just as damaging as any natural disaster.  With technology constantly changing, this sort of data loss is a very real possibility.

Smart business owners plan for this problem.  Much of the stored information will be confidential and having it fall into the wrong hands can have far reaching consequences.  It can open a business to lawsuits from clients and make your business liable for paying damages to hundreds if not thousands of clients.

A business's data and information needs to be protected through proper security measures and backed up in multiple ways.  There are many online options from Google to specialty companies that can do this for you.  If you are in a regulated industry such as healthcare or real estate, you have a legal obligation to store documents in a specific way for certain number of years. 

Situation #5: Regulatory Changes

Speaking of regulations, most businesses have to follow certain laws and compliance guidelines.  These can govern nearly any aspect of what a business does.  The problem is that many of these regulations can change over time.  These changes can be unavoidable and are often unexpected.  As new politicians are voted into office and the economic climate changes, the rules for doing business will also change.

Smart business owners will familiarize themselves with the laws and regulations related to their business.  What many of them fail to do, however, is plan for changes in these regulations.  A business that refuses to be dynamic and able to adapt to such changes is one which is precariously close to disaster.

For example, in 2011 there were far reaching changes made by the FCC that drastically affected how a telemarketer could get access to calling lists and contact consumers.  Businesses that didn't adapt in time where shut down by the FCC.  Only those businesses that made sure their business model could survive the new operational restrictions survived to dial another number.

How to Protect Your Business

Planning for negative possibilities can be stressful.  And it is impossible to predict all of the threats facing any business.  Fortunately, there are a few simple steps any business owner can take to protect themselves from these problems.

Take the time to review your business model and assess your risk in these 5 categories.  Then start by mitigating your biggest risk.  Work your way down the list so that within 90 days, you are completely protected. 

  1. You need a plan to cover the potential loss of any vital employee, including yourself! Create and document systems that allow the business to run without current employees.  Insurance should also be purchased to cover the company in the event of an accident or injury, and a firm succession plan should be updated every six months.

  2. Business owners need to be familiar with any potential natural disaster in the area in which they have assets such as offices or warehouses.  Storm-proof your business as much as possible.  Create a business continuity plan (example: can employees work from home while the office is restored?).  Finally, get adequate insurance to protect your assets and income.

  3. Revenue sources need to be analyzed.  Clients and customers need to be diversified to help mitigate the trouble associated with losing any one of them.  If there is only one main source of revenue, its time put a client acquisition plan into action.  If you can't handle any more clients right now, have other sources of work lined up at all times.

  4. All data should be backed up on a secure server which, if possible, is located off site.  These days cloud storage makes backing up data easy and affordable.  Information such as contracts and other legal documents should be printed out and stored in a secure location.  Schedule a day each month or each week to back up all new data.  Start this immediately.

  5. Smart business owners need to keep an eye on the current state of laws and regulations relating to their business.  Make sure you have the systems in place to keep your business operational.  If you are not sure how things affect you, contact an attorney with expertise in your industry.  A consultation is a lot cheaper than losing your business.


These are relatively simple steps which any business owner can take.  While there may be no way to predict the future, proper planning can help turn a major problem into a minor inconvenience. 

You have the power to protect your business and your income.  Not only will these steps help protect your business; they will help you sleep a little more soundly.

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The 3 Things You Must Do on July 1st


 

July 1 is a critical day in your business. Because it's the day that officially starts the second half of 2013. That's right, the year is already half-way over.

So right now is the PERFECT time to take an honest look at your business, see how much progress you've made so far this year, and develop your plan for the rest of 2013.

There are three things I strongly suggest you do on July 1 as follows:

1. Give Thanks


I hate to sound too righteous, but I recently watched 'Girl Rising' on CNN. The show "documents extraordinary girls and the power of education to change the world." While this description seems and is uplifting, some of the struggles of the girls profiled seemed unbearable.

In particular, the segment detailing the lives of most girls in Afghanistan left me crying.

So, please take a moment to understand how lucky you are. Lucky that you are even able to run a company and control your destiny.

2. Assess Your Results from the First Half of the Year


You must assess your results from the first half of 2013. Start by looking at your goals and plans for the first half of the year. And then look at your results.

  • Were your revenues as high as you had planned?

  • Did your profits exceed expectations?

  • Did you build as many new products/services as you had planned for the first half of the year?

  • Etc.

In assessing your performance, the key question to answer is "why?"  For instance, if you didn't achieve your revenues goals, what obstacles prevented your success? And, how can you overcome those obstacles going forward.

3. Create Your Goals & Plans for the Second Half of the Year


Now it's time to detail your goals and plans for the second half of 2013. Hopefully if you over-estimated your goals for the first half of the year, you can now do a better job of understanding what is more realistic to achieve in a 6-month period.

Think about this question: what must I accomplish in the next 6 months to make 2013 a great year?

Use this question as a guide in documenting your goals for the next 6 months and detailing your plans for how you will achieve them.

Remember, you still have half the year left. So even if you didn't achieve enough in the first six months, there's plenty of time left to make 2013 a banner year.

But importantly, make sure you set goals for the rest of the year, and have a way to measure your progress on them. If you don't, as some of you unfortunately just learned over the last six months, you won't achieve the success you desire.

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The First Anniversary of Legalized Crowdfunding Is A Bit of A Let Down


 

On April 4th of last year, the JOBS Act was signed into law. As part of the JOBS Act, equity-based crowdfunding was made legal in the US.

However, before entrepreneurs could start using equity-based crowdfunding, the SEC had to write the specific rules governing it. The SEC was given 9 months to write those rules; they were due on December 31, 2012. However, the SEC failed to meet that deadline.

And, even a year later, on the anniversary of the JOBS act earlier this month, the SEC still hadn't finalized the rules. The good news is that any day, they will. The bad news is that "any day" could mean tomorrow, or possibly 3 to 5 months from now.

Below I'll give you the run-down on Crowdfunding, and also the types of Crowdfunding you CAN raise today.

What is Crowdfunding?

Crowdfunding is getting a group of regular individuals (versus banks, venture capitalists or angel investors) to collectively fund your venture.

What are the 3 Core Types of Crowdfunding?

There are three core types of Crowdfunding.

The first is debt-based Crowdfunding also known as peer-to-peer lending. This is offered by sites like LendingClub.com and Prosper.com. On these sites, entrepreneurs (and individuals) can solicit loans from other individuals. Because they are loans, they must be paid back. Generally these loans are capped at $50,000 per year.

The second type is equity-based Crowdfunding. In this type of Crowdfunding individuals who give you money become investors and own equity in your company. Equity-based Crowdfunding IS legal today, but only when the funders are accredited investors (which entail them meeting certain criteria such as having annual incomes exceeding $250,000).

The final type of Crowdfunding is donation-based Crowdfunding. This type of Crowdfunding is the most popular and is offered by sites including Kickstarter.com, RocketHub.com, IndieGoGo.com and several others.

Donation-based Crowdfunding is my favorite since you neither give up equity nor have to repay the debt you receive. And it's MUCH easier to raise since there are tons more potential funders than funders of debt-based or equity-based Crowdfunding. For example, there are over 3 million registered users on Kickstarter.com.

However, there is an important caveat with donation-based Crowdfunding. Which is this: generally people don't donate money to your cause simply out of altruism. Rather, the companies who have successfully raised donation-based Crowdfunding offer rewards in return for donations.

Specifically, these rewards typically include the product or service the company intends to produce and/or offer. For example, San Francisco's Peter Dering wanted to raise money for a new product he conceived called the Capture Camera Clip System (an accessory for photographers that secures their cameras to their other gear).

So, as a reward to those who donated $50 or more, he promised to ship them the Capture Camera Clip System product when it was developed.

So, as you can see, this type of Crowdfunding is essentially pre-selling your products or services to your customers. Which is really the same as customer financing, which has been around for a while. But, with the internet, it's so much easier to reach tons of prospective customers.

What I also love about donation or rewards-based Crowdfunding is that it is amazing market research. I mean, if customers are willing to buy your product or service before it's even available, you clearly have a winner on your hands.

Which form should you choose?

In choosing the right type of Crowdfunding, here are my guidelines:

Debt-based Crowdfunding: You can raise up to $50,000 on both LendingClub.com and Prosper.com via this type of Crowdfunding. To do so, you will need a good credit score. So, if you have a good credit score, need less than $100K, and you will be able to generate profits pretty quickly that allow you to make the interest payments, then consider this funding source.

Equity-based Crowdfunding: If you require over $250,000 to launch or grow your venture, and the market for your venture is B2B customers (not consumers) and/or you can't immediately provide rewards for funders (e.g., you need $500K to further develop your new technology that might take another 2 years to fully develop), then I like equity-based Crowdfunding. You can either wait for the SEC to finalize its rules, or consider a site like Crowdfunder.com which allows you to raise it from accredited investors.

Donation-based Crowdfunding: If you have a consumer based product or service (or store), then I love donation-based Crowdfunding, because your investors are also your customers. Since this form is legal, you can go out there today and attract hundreds or thousands of investors. And when you do, you also have a built in customer base to buy from you long-term.

In summary, even though equity-based Crowdfunding to non-accredited investors is still not legal, there are other Crowdfunding options you can use today. So, if you need funding now, there's no need to wait.

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Is This The Secret to Entrepreneurial Success?


 

Today's article was written by my son, Max.  Max is 12 years old. I did not edit the article at all. He wrote it for his seventh grade English class.

I personally was inspired by his article. And it made me think about you and all the other entrepreneurs I strive to help succeed. As entrepreneurs, we will experience countless ups and downs. And throughout this process, we need to stay optimistic and have a positive attitude. And we need to enjoy the journey as much as the destination we hope to achieve. Maybe Max has the answer to this.

Enjoy!

Dave

"This I Believe"

by Max Lavinsky

 

"LIVE FROM NEW YORK... ITS SATURDAY NIGHT!" The jazz music starts blaring, and I'm in New York City surrounded by mobs of people, walking briskly to where they need to go. I see the faces of hilarious comedians like Bill Hader and Jay Pharaoh. I feel like I'm living in a carefree world. I believe in Saturday Night Live. It can teach us more meaningful lessons than you would expect.

As a young child I had always heard from my parents about this hilarious show called "Saturday Night Live." I can remember being shown little clips of skits from time to time. I instantly fell in love with them. I dreamed of the day when I could watch a full episode, or go into New York City to see a show live. This first time I was able to fulfill this dream, I was in the fifth grade. I had a fever, and I was home from school. I was going in and out of sleep when my mom came in and told me that I could watch something. I turned on the TV and came across Saturday Night Live. Without any hesitation, I turned it on and started watching. Jim Carey was hosting, and in my opinion he is one of the funniest actors ever. In the next hour, I laughed more than I normally would in a month. I forgot about all of my pain. It was crude and offensive, but I couldn't seem to wipe the smile off of my face. After the show ended, I wanted to keep watching.. I had to turn it off of course, but I knew I had just found something I loved.

After having watched Saturday Night Live, I look at everything a little bit differently. The glass is always half full. There is always a little bit of sun peeking out between the clouds. Now, I tend to laugh more. It has also taught me deeper and more important lessons, though. Saturday Night Live can be racist, bias, use terrible stereotypes, and just be flat out horrible. While this is certainly a bad thing, there is some good. It teaches us to laugh at ourselves, and to be able to deal with getting made fun of. This is a skill that many people lack, and it makes them uptight, and without a full sense of humor. If everyone was able to laugh at themselves, maybe nobody would fight. Maybe, we could all live in peace. Maybe, if we could just do something as simple as laugh at ourselves, our world could be perfect. To think that Saturday Night Live could make a perfect world may sound outrageous, but it is not. Things as little as a TV show can change us. To some people that seems irrelevant, and it did to me once. But that of course, was before I watched Saturday Night Live.

So Saturday Night Live definitely has its cons. But while it embarrasses and offends us, it teaches us how laugh at ourselves. Will Ferrell once called Saturday Night Live a "comedy boot camp" because it teaches us how to have a sense of humor and appreciate comedy. So try something new. Watch Saturday Night Live and laugh.

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The Incredible Power of Mastermind Groups


 

For the past 5 years, I have been part of several mastermind groups that have helped me dramatically grow several of my own businesses.

Below I will explain to you what mastermind groups are and how they can benefit you and your business.

What is a Mastermind Group?

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Update on the JOBS Act and Raising Equity from Crowdfunding


 

As you may recall from last year, the Jumpstart Our Business Startups Act (called the JOBS Act) was passed and signed by President Obama in April, 2012.

The JOBS Act makes equity-based crowdfunding much easier

The JOBS Act makes it possible to raise funds from investors and donors through certain crowdfunding sites in exchange for equity in your company.

This was supposed to start on January 1st 2013. (more on this below).

The key to the JOBS Act is this: it opens up more possibilities in equity funding without the tedious requirements to register your funding as a public offering with the Securities & Exchange Commission (SEC).

If you have tried to raise funds in the past by going the public offering route, you'll know that it's expensive. Being able to bypass all that is huge, especially if you are raising smaller amounts of funding that don't justify such expenses.

The passing of the JOBS Act also means you won't have to seek out accredited investors specifically (people with incomes of $200,000 or more, or a net worth of $1,000,000 or more-not including their residence). Rather, you will be able to get funding from people of all income ranges, which makes the pool of potential investors MUCH bigger.

Imagine how many regular people are out there, who might want to reallocate some of the funds they already have invested in savings, stocks, mutual funds, or other investments that aren't paying so well at present. In the future, funding other businesses might be a much more common way to diversify your capital-that anyone can do and not just accredited investors. Even you!

So, what's the latest?

As mentioned above, equity based crowdfunding was supposed to go live on January 1st 2013. This was predicated on the SEC writing the crowdfunding regulations by December 31 2012 like they were supposed to.

But this never happened. The two key issues regarding why this didn't happen were: 1) a lack of consensus within the SEC decision-makers about the regulations, and 2) the recent resignation of the former chair of the SEC.

Both of these issues are expected to be resolved with the recent appointment of Mary Jo White to head the SEC. White is one serious woman - her career includes serving as the New York prosecutor who brought down John Gotti and put many terrorists in jail.

So, it is expected that within the next 60 to 90 days that Mary Jo White will take the helm and help the SEC write the regulations that make equity based crowdfunding legal in the United States.

How can you prepare for this now?

If you want to raise equity capital later this year and beyond, here's a quick list of things you can do now to be ready when the time comes:

Broaden your network

One advantage crowdfunding sites offer you is having access to more investors and donors than there already are in your personal network. These sites generate their own traffic, and a percentage of your funding will come from people searching those sites or stumbling across it.

As it turns out, enough projects have been successfully funded (using the donation-based Crowdfunding model, not the equity-based crowdfunding model) for experts to be able to look back and say that your project is much more likely to be successful if the first quarter to third of the funding comes from your existing network first. Reason being, they are the ones most likely to believe in and trust you already, and strangers want to see some social proof and credibility in advance before they jump on board.

Deepen your relationships


Do this for the same reason I mentioned above-to get the ball rolling on your funding from your existing contacts. So in the coming months, you should be out seeking new relationships and strengthening the ones you have-specifically with those who are more likely candidates for funding you, or those who are in a position to spread the word for you.

You don't even have to mention funding during this time. Just spend the time necessary to confirm that they have the means and would be interested in your project, while at the same time showing your willingness to serve them and build trust and experience together.

If you're already in business, keep growing it

As with any kind of funding, you will be in a much stronger position to ask for funds if you can demonstrate success in the past. You will have more data available to work into your plan and forecast. And, people want prefer to invest in something that looks like a sure thing-with the least uncertainty. So keep doing what you're doing and you'll be able to show prospective investors your first-half 2013 financial statements and smile.

Work on your business plan


Also, as always, have a solid plan for how much funding you need, how you will spend it, and what effects it will have on your operations and revenues. People want to lend to someone who has thought things through and looks less likely to run into unforeseen problems-especially strangers online! Remember that.

It will also take some time to craft your presentation and pitch. If you plan on using a slideshow or video of some kind (or even just writing it out on your project's page), it will take some time to put that together in advance. But, it's something you can be doing now.

So there it is...equity-based crowdfunding is one more way to get the funds you need to launch or grow your business. Stay tuned to the developments (you'll hear them from me) and prepare for funding like you normally would. This  might just be the key to your company's growth!

 

Suggested Resource: Do you want Crowdfunding? If so, don't try to raise it from scratch -- the 14-step blueprint already exists. Get the Crowdfunding blueprint here.

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