In 48 hours is about a promise and an approach. Our promise is that in 48 hours we will start you down many roads, each one leading to an improved part of your business. We will touch your brand, your reach, your distribution strategy, your customer satisfaction, your sourcing and even your finance and administration. And we will do it all in 48 hours.

Our approach is different too. We are not a bunch of speakers with powerpoints. This is about action. You will bring your computer. We will hook you up to superfast broadband. And right there and then we will get you using new tools and new techniques to improve your business.

It will be led by me, Doug Richard, and I am team teaching with two other people: Andrew Davis and Joost de Valk. Andrew is one of the country’s leading social media experts. He launched BBC 1xtra and MySpace into the UK market. His extensive work in digital marketing led to his inclusion in the Guardian newspaper’s 2007 ‘Minority Report’, Andrew’s continued success for MySpace was again noticed the following year, when he became the only entrant to make it into the list for both Media Week’s ’30 under 30′ and Broadcast magazine’s ‘Hot Shots’. His highly influential social media blog is read globally.

He is accompanied by Joost de Valk one of the world’s expert in the design and development of websites that draw audience and rank highly for search. He is recognized as one of the top strategists on the web.

The three of us are committed to taking you on an intensive journey. We will lock your identity down on the web, take you through the essentials things you must do, and do right, in developing your web site to draw prospects in and make them customers. We will show you how to do this spending nothing or hundreds of pounds, not thousands or tens of thousands of pounds.

We will teach you how to leverage the web giants: eBay, Amazon, Google, Facebook and Twitter. We know their forthcoming strategies and we know what needs to be done to leverage them effectively.

We will introduce you to websites you may never have heard of that can drive partners to your door through affiliate systems, vertical market selling and extending your reach.

If you build products we will help you source them from a better supplier. If you are a supplier we will show you ways to get new people to source from you.

We will show you how to create new relationships with customers that are intimate and scalable at the same time.

We will do everything we can to open your eyes to a new way of working. We will take you through the steps and make sure you understand. We will give you the checklists to follow and the guidance to be effective after you leave the room.

In short, we will help you make your business grow. This is a new approach. It’s a fast and intensive approach and it can change the course of your business. In 48 hours.

We look forward to seeing you there. Click here to buy a an early bird ticket. Use the discount code 100-OFF to receive a £100 discount (ends 16th July).

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Even more puzzling was the unthinking regard that everyone holds for the externally funded business. Get angel funding, get venture capital, get debt from a bank is what I hear people encouraging new entrepreneurs; as though the ability to raise money equates to the ability to make money. It doesn’t. Just as measuring your business success by the number of people you employ is vanity, not sanity.

The heart of the issue is this question: what constitutes business success? In an age of growing awareness of carbon footprint, in a time when the fastest growing businesses are social enterprises, at a point in the economic cycle when we need to drive entrepreneurs to help solve social issues; we no longer have time for these false dichotomies.

A business success can be measured on the bottom line. A business success is not measured on its top line. I have heard celebrity entrepreneurs brag about their businesses calling out their total revenue as though the sheer volume of cash that their business touched was somehow meaningful. I picture them skinny dipping in all that cash as it washes by cackling irrationally not realizing that the flow of cash is not the same as the stickiness of profit. The reality was that they made a skinny 1% profit on all that cash. A business with one tenth the revenue that makes 10% on its money is precisely as successful. Revenue is just not profit.

It is not measured by the number of people it employs. Over and over I hear people talk about the size of their organizations. All I hear is the cost of their payroll. Is this just a man thing? Are we really comparing size still as adults? Get over it. In business size doesn’t matter.

One of the most progressive entrepreneurs I know, Emma Jones of Enterprise Nation who advocates for home-based businesses, makes the point that many modern start-ups intentionally work with contractors rather than taking on the cost of a full time employee. They are more resilient businesses. They are more flexible businesses. They employ less people. Their success is inversely proportional to the number of people they have employed. And they offer the collateral benefit to society of supporting other small businesses.

But I digress. Let’s return to the blowhard who caused me to reflect on the initial question: what do people have against lifestyle businesses? A lifestyle business is simply one where the owner seeks to make the business successful not only in terms of profitability but also in terms of its ability to make his or her life more successful. It is this intentional inclusion of other measures of success that also define a social enterprise. It is exactly this awareness of the impact on the environment that defines the green enterprise.

In short it is the insight that there are other stakeholders in a business that makes a business ethical at all. So where in hell does my un-named blowhard get off dissing lifetstyle businesses?

I believe that people should build businesses around their passions and around their lives. I believe that some businesses deserve to grow to fully express themselves or contribute to society. But other businesses should remain small and focussed. And who is he to tell anyone what they aspire to or grade the result on such a myopically narrow measure. Personally, I run a lifestyle business and he can f**k off.

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On your first business venture, what was the most challenging thing to deal with? – Shanta

Well, it is hard to pick a “most challenging thing”.  Generally, it was a great experience in the sense that I learned an incredible amount and the little team I and my brother Ken assembled did some amazing things.  At the time I would have said “cash flow” was our biggest hassle. Later, due to the pressures of running a very high speed, large number of large transactions tech business, I would have said our biggest challenge was interpersonal issues related to working with family and friends for a long period of time.
Now I’d say the true problem was there was no “mentor” we could turn to who could help us plan and transition from one business model to another correctly.  That’s one of the reasons I’m starting the School for Startups Mentoring Club…

When you have a business that’s running very fast and with significant intensity, switching over to a business model that leverages all your existing assets but starts generating passive wealth is like trying to having a high speed train switch tracks.  If its not a very carefully considered  transition, it is going to be traumatic.

Q: When asking the question ‘are you on a mission?’, Doug mentioned that if you wanted to ‘save the world’ great, do so, but maybe it’s not a business. I would like to know what he considers a suitable definition of what a business is. And further, what a successful business was. – Tom

Don’t get me wrong, please feel free to save the world.  Goodness knows there’s a lot to do.  And, saving the world can be a business.  Social enterprises are designed to make self sustaining solutions to some of the world’s big problems. But . . . a desire to save the world and filing the paperwork to start an enterprise does not a business make. An activity can only be called a business if it makes makes enough money to pay its bills. Really, if it is to be capable of growth, it has to turn a profit which can be used to fund that growth.

What is the best way to recruit new people? – Pietro

Recruit people to do what?  Work for your business?  Well, money can get you some great people . . . I suspect you are asking how do you recruit the right people for your startup when you don’t have lots of money. And the answer is to have a great business model that you can pitch very well, and a reasonably friendly, honest, straight-forward, practical and pragmatic personality so people want to work for you.

You touched on how gaps in the market are thrown at us every day, but we rarely are set up to spot them. Are you able to expand on this a little? How do we train ourselves or become more open to seeing sources for ideas? – Ross

What I love about entrepreneurs is they see problems as opportunities.  So spotting the gaps is pretty easy really.  Look for what’s wrong and start thinking of ways to fix it.  If you never have food in the house because you never have time to go shopping, chances are you’d pay a bit of a premium for a business that would just deliver groceries the way other businesses deliver pizza. If you’re tired of having your family descend on your house every Christmas, so you get stuck doing all the cooking and cleaning, chances are you know what someone wants in a “Self-Catered Christmas Get Away” that you could tell your family to join you on instead. Every problem is a business waiting to happen . . .  Deciding which business you care enough to design and build is always the tricky thing.

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Why was IBM Global Entrepreneur founded?

We know that working with startups can drive change. Today, the world’s physical systems are being infused with intelligence, and this opportunity to apply information technology to physical infrastructure opens up vast new markets for the IT industry.  With disruptive, new technologies, this is the perfect scenario for innovative entrepreneurs to play a major role.  With IBM’s unique vision of a Smarter Planet (ibm.com/smarterplanet/uk), we are looking to partner with technology entrepreneurs who share this vision and want to work together to address this new market opportunity.

What kinds of support do you offer to entrepreneurs?

IBM Global Entrepreneur has the products, people, and promotion that can help technology startups extend the size and reach of their company.  The initiative provides support and resources in the areas these startups need most:

1. Product
   • No charge access to IBM’s software portfolio on-site or through the cloud to accelerate software development
2. People
   • Dedicated technical enablement support to help startups develop their product and get to the marketplace faster.
   • Mentors at IBM SmartCamps around the world who can help them grow their business.
   • Industry market intelligence from our top industry experts that can help them understand the enterprise customer and the market opportunity.
3. Promotion
   • Visibility as part of the IBM Smarter Planet agenda to set themselves apart from the competition.
   • Recognition and additional benefits to partners with the most innovative solutions
   • Opportunity to showcase their company in the IBM Global Entrepreneur directory.

When was the initiative started and how many entrepreneurs have you helped?

IBM Global Entrepreneur launched on 31st March 2010, so is very new at the moment. Given this, we are at the stage of raising awareness of what we have to offer, and encouraging participation. We are doing this by engaging with individuals and organisations who are already well established in this community, and we are delighted that School for Startups is working with us as one of our ecosystem partners. Hundreds of startups have shown interest in our new initiative, and I am delighted with how enthusiastic people have been who I’ve spoken to about what we are doing.

How do entrepreneurs participate?

Startups who meet the eligibility criteria can register at ibm.com/isv/startup. On our application form we ask a few simple questions to help us understand a little about their companies, and once accepted they will be contacted by one of our Project Resource Managers (PRM). The assigned PRM will make a personal call  to welcome them, and will guide them through how they can make best us of the resources we provide on a one-to-one basis.

Startups can also apply to participate in our IBM SmartCamp London event which is taking place on 21st July at Imperial College London. SmartCamp is an exclusive event that brings together entrepreneurs, investors and experienced mentors who want to help us build a Smarter Planet. SmartCamp provides startups access to world-class advisors, plus a direct route to seed and venture capital. Applications for the London event can be made from now until 2nd July 2010.

What is your background and how did you come to IBM?

In 1987 IBM launched an integrated degree scheme with the University of Portsmouth, and I was one of the original intake to the scheme of 20 students. The initiative was pioneering as it was the first time in the UK that a company’s in-house training counted as credits towards a degree – a BSc in Computer Science. Our time was split on a weekly basis between our studies and doing a real job in IBM, so a very different model to a traditional sandwich course. The great thing was that we were paid a salary for the 3 years of the course, which certainly enhanced the experience!

Since graduating, I’ve performed a very diverse mixture of technical and business roles in IBM, both in the UK and across Europe. In 2005 I took on responsibility for establishing the IBM Academic Initiative (ibm.com/academicinitiative) across Europe, Middle East and Africa, and it was through this programme that I first started engaging with entrepreneurial students in the universities. I still look after this programme in the UK & Ireland, and am very excited about the new opportunities that leading the IBM Global Entrepreneur initiative is bringing. It is such an inspirational community of people to be collaborating with.

Is there a way entrepreneurs can learn more about the initiative online?

Our website is the best place to go to learn more: ibm.com/isv/startup

Additional information on IBM SmartCamp London can be found at ibm.com/ie/smarterplanet/smartcamp

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[VIEW THE MAGAZINE HERE]

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Are entrepreneurs born or made? — Bryan

Entrepreneurs are always made.

People don’t come out of the womb knowing how to pitch, to sell, to design. One may make the case that some folks seem to want to be entrepreneurs more than others.  But that may be because they learn, sooner than others, what entrepreneurs do.  In a larger sense . . . no one “is” any profession or skill. That’s a convenient fiction. No one is a writer or is a salesman.  People write and sell.  You can master entrepreneurship by caring enough to acquire and master the skills you need to build businesses.  Get to work

How can you detach yourself from a venture? How to you evaluate a business that you’ve been emotionally attached to? — Keith

Actually, we have a great article about that. You can find it here.  But the short answer is that lots of entrepreneurs start businesses because they have “missions” they are passionate about.

Perhaps they want to bring clean water to villages. Perhaps they want to open the world of computers to senior citizens.  Maybe they want to teach people to dance.

Sometimes their vision of how to achieve that objective is so narrow and so flawed, they have a hard time of making a business of it.  When this happens they start a business and it fails to thrive.

The Market is a great educator.

The visionary entrepreneur has to realize that businesses are ephemeral.  They come and go. Your commitment to your mission can go on as long as you like.

Within that context, any business you create to support your mission is ephemeral.  You can reformulate an existing business in a new way, or close an existing business in order to start a new one based on a different financial model.  For those with very philanthropic objectives, you may even consider creating a social enterprise, cooperative or charity . . . .

Or perhaps you will find that the best way to achieve your mission is not starting an enterprise, but joining an existing one that is doing what you’d like to do.

I think you’ll find, given this perspective, it’s easy to let go of a business. It’s like letting go of business cards you don’t use anymore, or dropping that fax number you no longer need.  If it’s the work you really care about . . . you probably don’t have to give that up just cause a given business proves unfeasible.

Is the reason for focusing on internet based businesses because that’s where the future is or because it’s the type of venture the Cambridge set are likely to be ‘into’ and as such is the best fit for the attendees. — Martin

Well, actually, neither of those reasons are why we focus on the Internet.

Basically, folks who have a business need customers.  Very broadly speaking, there are two ways to get them.

• You can call people and knock on their doors and try to tell them about your product.
• You can put your product where people who are looking for it are likely to find it.

The second option, sometimes called “in-bound marketing” is very cheap and cost effective, and the Internet is the cheapest “in-bound” marketing solution around.  If you do your job right, you can put your product where people who want to buy what you sell can find it.

So . . . we focus on how to put your products and services on the Internet.  In most cases it is the cheapest and fastest way for many of our entrepreneurs to get access to hundreds, thousands or millions of customers.  The Build Your Business Now toolkit that we built to support the course explains how ot create the simple site you need in just a few hours.

Market segment analysis. Instead of searching on Google, are there any specific places to retrieve this type of information? — Katherine

Well, we think you’ll be happier looking on Google (and perhaps other search engines) for information on market segments because getting the data there is fast and easy and you know it is timely.

For most businesses, the easiest to reach market of “ready to buy” customers are those who are looking for your service on Google because they are ready to buy.  If someone goes to Google and types in “Dog Grooming”, chances are its not an academic search.  They actually want a Dog Groomer.  If some customers search for “Sidcup Dog Groomers” others search for “Chislehurst Dog Groomer” and still others search for “Organic Dog Groomers South East”, that’s a person who is almost certainly ready to buy.

You can also look at sites that you think offer competing services and see how Google sees them from a keyword standpoint.  Go to http://www.google.com/sktool/ and http://www.google.com/trends to explore your market segments and related keywords.

Pricing: how much is it worth to them? … I recognize that the price of a product should be set to what a person will pay, not set to what they say they might be willing to pay. There could potentially be a large gap between how different entities value a product or service. Apart from asking prospects, apart from only looking at competitors’ pricing, what other tips would you suggest for setting price? (coming from the perspective of an internet based, B2B SaaS model with a product attempting to resegment an existing market with a niche strategy) – Steve

Pricing is always a matter of trial and error and you’ll almost always leave some money on the table. If you check out the Build Your Business Now Toolkit that was distributed after the class, you’ll see some practical advice and steps for figuring out price.

Basically you have to identify your target markets, see what they are paying for competing solutions, and price yourself in that zone.  If there are no real competing solutions, you have to look at what NOT having your solution costs them.  Using those two “ballparking” procedures will usually get you in your zone pricewise for each market segment . . . and then the issue is making sure each segment sees the right pricing.

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Few of us will ever be in a position to make mistakes this big.

But every successful entrepreneur eventually makes decisions that can have a major impact on the lives of customers, employees or the public.  Maybe this is a good time to review some steps you can follow to avoid the big mistakes.

• Recognize the Risks. Almost every product or service delivered has some capacity to harm people.  A web site that offers holiday cooking tips and tricks can pass out bad advice on how to cook the Christmas Goose.  A toy maker can make button eyes that are too easy to detach and too easy to choke on.  Take a hard look at your product or service and consider the risks it represents in a worse case scenario.  Methodically work through how it can harm people. Consider who it comes in contact with, what purpose it serves for them, what mistakes they might make, and how likely those risks are to cause serious injury or death.  Take steps to address those worst case scenarios.
• Work with failure experts. There are businesses that have engineers and analysts trained to measure risks who can give you practical guidance on how to limit them.  These “failure analysis” professionals are easy to find on Google and hiring them to pinpoint and address your greatest risks is far cheaper than waiting until things have gone wrong.
• Recognize near misses and act quickly. So many mistakes can be minimized by taking effective action at the first sign of failure. Often a big mistake is preceded by a series of smaller, less serious mistakes that result in a minimal losses but point the way to something far worse ahead.  Pay attention to these “canaries in a coal mine”.  The near miss, the almost accident, the disaster avoided are all harbingers of something far worse directly ahead. Don’t ever allow yourself to see them as “lucky breaks”.  They are dire warnings. Take heed.

Events like those we are seeing in the Gulf are almost never the result of “one bad day” or the “mistakes of a single man”.  They are the result of patterns of behavior that eventually culminated in something truly disastrous.

Your business may not be in a position to make a mistake as big as the one on-going in the gulf.  But now is a good time for every business owner to pause and reflect on the lives their products and services effect every day, and to think about the steps they’ve taken to address potential costs of catastrophic failures to their customers, their employees and the general public.

As a business owner, can you do anything to make your product or service safer today?

If so, that’s probably the best way to show you’ve learned a lesson from the events in the gulf over the last three weeks.  While laying the blame for what happened on the Deep Water Horizon solely at the feet of one individual, one company, one industry is naive given the complexity of the technical, economic, government systems involved, we can certainly agree it was in the interests of everyone to prevent what happened.  Many people must be held responsible. There is an ocean of failure to be shared by many, many people who failed to take appropriate action.

Billions will be spent trying to compensate individuals and economies for what they’ve lost. But the truth is, no amount of after the fact analysis or future care will give the earth it’s gulf waters and its vibrant healthy ecosystem back.

Let us all take a moment to demonstrate we’ve learned the lesson that some mistakes can’t be undone.

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And nothing happens.

Except, perhaps, that your sales fall off a bit because you’ve spent so much time creating and marketing your website that you’ve neglected to make the contacts you usually use to generate business.

Take heart. Making your website do what it is supposed to do doesn’t cost much and doesn’t take long. You just need some practical advice on how to make it work right.

Start by Making it Easy to Place Orders

Having a website doesn’t mean you no longer have to market and sell your products. What it does mean is that you can have an order taker standing around 24/7 to take people’s money.

If your objective is actually to close sales online, the process of ordering your products and services online has to be effortless for your customers. If they go to your site knowing what they want, they should be able to find it in two clicks and they should be able to order it in one more.

If this is not how your website is working, then you have found a key reason why your sales are not what they should be.

Sometimes the problem is your page design. It spends more time talking about you and your team than getting people to the products and services they want to buy. Having articles and blogs online does help bring people to your site, and can keep them there until they decide to shop, but a sluggish or confusing ordering process “unsells” people. It is so easy to get online commerce right these days that most folks have no confidence in people who get it wrong.

How do you make placing orders though your site easy?

Paypal makes it easy to create “Buy Now” buttons for any product on any page on your site. People trust PayPal. The PayPal checkout process is quick, secure, and predictable. If you have under ten simple products to sell on your site, just stick Buy Now buttons on your pages and you should see sales go up. If your products require people to pick sizes, choose colors, select shipping options, or specify other parameters, Buy Now buttons probably aren’t the best choice.

Online ecommerce solutions like Yahoo Stores, Pro Stores or EventBrite, make creating full featured catalogs of products and services easy. You can be online in minutes with these online store solutions, even if you nothing about HTML or programming. These tools handle size, color, shipping and most other purchase options quite handily.

Open source catalog solutions like Magento work well for people who just believe, very strongly, that they have to host their catalog on their own servers. You can install them in a matter of hours, add your products and services to them, and start taking sales in under a couple of days. You can customize their look and feel completely.

It almost never makes sense for a small business to create a custom online sales solution when there are so many that can be had for next to nothing, that customers already trust, and which are so easy to customize. Your time will be better spent driving traffic to your fully functional site.

Marketing & Selling Products Online

Once you can take orders for your products and services on your site, you can begin pouring customers onto the site to take orders from.

If you have been taking orders for your products offline with some frequency, then you already know who your customers are, why they buy your products and where they can be found. You can tell your existing pool of customers your website address and you’ve effectively given them an order taker they can turn to at any time to get your products and services.

When you want to get new customers via the internet, your understanding of who your customers are and why they buy your products will remain, for the most part, unchanged. You will just need to determine where your customers lurk online.

If your products and services are delivered to local populations, then you may find tools like Google’s Local Business Center useful. It lets you geographically locate your business in Google Maps, so that when people in your geographical area search Google for “florist”, “plant nursery”, “child care center” or “computer repair” a link to your business pops up along with a pointer to your location on a map. This gets them to your page where they can place an order.

If your products and services are, by and large, location independent then you will use other mechanisms to drive traffic to your site. You may decide to:

• Place ads on Google and other search engines that will display when potential customers are searching for the products and services you provide.
• Use Search Engine Optimization techniques (SEO) to get more links to your business high in the normal listings for your target keywords.
• Place advertisements on the websites that your customers go to for news or entertainment.
• Advertise in print magazines or newspapers that your customer read.
• Work to have articles and blogs written about your product or service by writers that your customers read.

If, after several weeks, you find that your website is not helping your company earn more, the cause is almost invariably one of the following:

• Your site makes it hard to place an order.
• Something about your site makes customers doubt that you can fulfill their order (inaccurate information, misspellings, unattractive layout or design, etc.)
• Your site doesn’t provide the information customers need in order to decide to buy.
• The wrong people are visiting your site because your marketing is funneling the wrong people there.
• No one is visiting your site because your online marketing is ineffective or non-existent.

If your website is equipped with a page counter or Google analytics toolset that lets you track how many people are coming to your site, what pages they look at, when and if they click the order button then you should be able to discern which of these issues is effecting your online sales.

A methodical approach to resolving these problems will result in increased revenue for your site.

Closing Sales Online

In designing and developing a functional website to sell your products it pays to take a very analytical, very practical, very limited approach to deployment.

Start with ensuring that purchase of a product is a matter of a few clicks, that customer’s you’ve met in the real world feel comfortable buying through your online interface, then work on driving more traffic to your site so more customers can be closed. Make sure it is very easy for people to ask you questions about your products and services, and that you request feedback on the order process after every sale. Your online customers are the best people to provide you with advice and guidance on how to sell more online.

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However, delivering products and services for free can be a more than minefield for those without a good grasp of the underlying business fundamentals. The following overview of “Give it Away” business models reviews some of the ways in which free or low-cost products can help build businesses that turn a profit.

Free Samples

The candy samples stores pass out around the holidays are given to customers at no cost. They are certainly not “free” to produce or distribute, but they are the best “advertisement” a candy company has to offer and so make a reasonable marketing expense.

If you make a product or service that people will only choose to buy once they know they like it, you will need to find a way to let them sample the product or service prior to purchase. Food, cosmetics and fragrances are just a few of the goods that are frequently promoted this way. Software is occasionally sold this way as well. When using free samples to promote software products, your trial products must be in a form that demonstrates real value but must not be so useful or so generally available that people never have to buy the full product.

Generally speaking, you should make it as easy as possible to go from trying a free sample to owning the product. If you pass out free candy near the candy store, or make trial products that turn into full products when people enter an entirely unique and unforgeable unlock key, this works well. Distributing free samples of your product can go badly awry if the samples you produce and distribute at great cost do not end up in the hands, or on the computers, of the people who can and will pay for them.

The Bait & Hook

Razors need razor blades and printers need toner. These are examples of items given away for free or cheap because use of the thing will require a subsequent sale.

For this model to work, your product needs to come in multiple components, some of which are delivered at or below cost, others of which are sold subsequently at much higher margins. The total price of all components, which is to say the complete product, must meet customers needs and expectations. The cost of producing and distributing all components of the product must be less than the revenue generated by the sum of all sales which can get tricky with so many moving parts.

Some online services try to follow this model by allowing people to use their product at a limited level at no cost, with additional features available for a fee. This model works when the product meets a customer need and when use of the product continues over time. It can be a quite fatal business model if the free features of the product are so useful that no one ever pays for more features, or if the free trial is so limited people abandon it long before they need more features or capacity.

When this model is applied to open source software it fails if potential customers have difficulty installing and using the “free software”. It also fails if use of the software is so easy to install and use that it requires no for-hire technical support or training.

As you can see, the Bait & Hook business model requires that many things go right in order for it to be profitable.

Ad Supported Media

Ad-laden periodicals distributed to target markets are not “free” in any sense. The publisher of the newspaper has customers who pay to advertise and part of the publisher’s advertising packaging and distribution service is to create the content that goes around the ads and to get the finished publication to the advertisers’ prospective customers. Radio, television and sponsored events follow the ad supported media model.

In this model the business owner must remember that the customer is always the advertiser and the “audience” is the customer’s customer. Entrepreneurs must walk a tight rope between these two poles. Catering to either party at the expense of the other is a sure way to go out of business.

This model works when the audience wants the media or event, and when some significant percentage of that audience wants the products and services the advertiser sells. This model falls apart when the market media appeals to does not buy the advertisers products.

Sometimes both advertisers and publisher think the absolute size of the audience receiving the message is some measure of success. It is not. That is a measure of expense if it is a measure of anything. The measure of success, fron an advertiser’s standpoint, is in a ratio of low ad costs to high product sales. From a publishers/producer’s standpoint, the measure of success is in the ratio of ad revenues over content development and distribution costs.

Test Your Business Model Extensively Before Going “Big” with Anything “Free”

In the previous business model overviews it is clear that “free” never ever means free to the business owner. Business owners are always on the hook to pay for what others are receiving from them at no cost.

If you elect to try and implement a “Give it Away” business model, you must extensively test that business model throughout product development on as many small populations of your target market as possible. You must refine your products and services to maximize the conversion from accepting what’s made available free to paying for something of demonstrated value. Failure to do this is the surest way to make a very expensive mistake.

Related posts:

1. Entrepreneur’s Guide to Creating & Testing Business Models
2. An Entrepreneur’s Guide to SEO Through Press Releases
3. What Businesses Will Be Worrying About Next Year

On Monday I stood on a soapbox with a loudhailer in the town centre of Leicester and hailed anyone and everyone who would listen with my views on the upcoming election and why it’s critical that we make the growth of small business the central pre-occupation of government.

I have written about this extensively before in my Entrepreneurs Manifesto and in other blog posts so I do not want to dwell too long on the underlying message for fear of sounding like a broken record.

But the case, at least to me, is clear. Ultimately all the revenue of government comes from the taxation of business. If you want more revenue you need to increase the tax base. Most, if not all growth in business stems from the growth of small business. Thus, it’s not rocket science, if we want to dig ourselves out of this financial hole we need to encourage and stimulate the growth of small business.

The question is how. If you want to understand the details of my beliefs take a look at the second part of the manifesto called “The Declaration of Rights” (page 5 here). I talk there about:

• increasing economic freedom for entrepreneurs,
• removing the dead weight of current government support systems,
• increasing the ease of family and friends investing small amounts in new businesses,
• creating much larger incentives for businesses to adopt interns and apprentices,
• new legal formats for the creation of social enterprises,
• a legal mandate for government to spend a portion of its procurement on small business
• and lastly, undoing the pernicious digital economy bill (See “F**k the Digital Economy Bill“) that would hobble broadband and in fact a large scale infrastructure investment in super-fast broadband nationwide.

So I shall leave that there. But I do want to point out that if you want to understand how public relations works; this isn’t a bad case study.

• We attracted a 10 minute interview on BBC Leicester (Listen here, interview at 2:04:50) ,
• Coverage in the key daily newspaper, The Leicester Mercury (Read here),
• We will be appearing on the FT website with a video interview set up as a message to the candidates for Prime Minister. UPDATE: watch the video interview here.
• The Lord Mayor came down to the soapbox and invited us back to Town Hall for tea and we discussed ways in which the city could help support our forthcoming bootcamp in Leicester on May 10^th (Read about it here);
• We had most of the prospective candidates for Parliament out to hear what we said (at least the Lib Dems and the Conservatives. No one from Labour showed)

In short, we were able to persuade the news media and other people that standing on a soapbox and yelling was a newsworthy activity in its own right and they should pay attention.

In the process I felt an unfamiliar sensation. It was quite peculiar. I did not immediately understand what it could be. I then realised, this is what embarrassment must feel like. Yes, I was definitely feeling embarrassed. My God, I couldn’t remember when I last felt embarrassed (actually I can but my teen years are my private hell and I don’t intend to share them with you).

It is a useful thing to note. It takes shamelessness and sometimes cringing self promotion to get above the noise. I can safely say on all points, we accomplished that.

Long live the revolution.

Doug

Related posts:

1. Entrepreneurs’ Manifesto Press Round-Up
2. Leicester Mercury
3. Naked Business: Building a Wall of Sound