Continue reading Finding ways to survive the tech startup squeeze

Finding ways to survive the tech startup squeeze originally appeared on BloggingStocks on Tue, 04 Nov 2008 17:00:00 EST. Please see our terms for use of feeds.

Lately, the headlines have been scary. Unemployment is increasing. There are concerns from the presidential candidates. Real estate values are sagging and foreclosures are skyrocketing. And, premier companies - like Citigroup (NYSE: C) and Merrill Lynch (NYSE: MER) - have raised billions of dollars to deal with heavy losses.

So, if the economy is slowing down, how can your business deal with things?

Let's take a look:

Deal with hidden costs: When looking at expense items, some might seem small. But it's often the case that these items - in aggregate - can turn into a big deal.

According to Tom Sharples, president of Qorvus Systems: "Typical small- or medium-sized businesses that have been around for a few years can find duplicative costs: unused cell-phone contracts that continue to rack up charges, subscriptions to services associated with long-departed employees and often all sorts of legacy junk that no one even remembers ordering, but that you're still paying for every month."

Continue reading Entrepreneur's Journal: Fortify your business from the recession

Entrepreneur's Journal: Fortify your business from the recession originally appeared on BloggingStocks on Sat, 19 Jan 2008 14:00:00 EST. Please see our terms for use of feeds.

It was a tough time in 1977. There was inflation, unemployment and political turmoil because of Watergate.

But such things didn't mean much for a group of programmers -- Bob Miner, Ed Oates, and Larry Ellison. They started a database software company called Structured Development Laboratories. Of course, the company would eventually be renamed Oracle Corp. (NASDAQ: ORCL) and grow into a multi-billion dollar powerhouse.

Well, this week at the popular Oracle OpenWorld conference, Larry devoted his keynote to the early days of the company (the picture on the upper right is the original 900-square foot office location).

Continue reading Entrepreneur's Journal: Startup advice from Oracle's Larry Ellison

Entrepreneur's Journal: Startup advice from Oracle's Larry Ellison originally appeared on BloggingStocks on Thu, 15 Nov 2007 15:30:00 EST. Please see our terms for use of feeds.

If you take a look at the stories of great entrepreneurs - such as Wal-Mart (NYSE: WMT)'s Sam Walton, Microsoft (NASDAQ: MSFT)'s Bill Gates, and Howard Schultz of Starbucks (NASDAQ: SBUX) - you will see that they had the help of mentors and advisors.

After all, being an entrepreneur can be lonely, stressful and challenging. And it's often difficult to get solid advice.

"I can't overstate the importance of mentors in my life," said Ben Casnocha. Ben started his first business at 14 years old, and even wrote a book on his experiences, My Start-Up Life: What a (Very) Young CEO Learned on His Journey Through Silicon Valley.

So where do you find mentors? Ben recommends lots of networking. In fact, he considers the Small Business Administration's SCORE (Service Corps of Retired Executives) a great resource (and it's free).

But be wary. Make sure you do lots of background research on the people you like. You might realize that they really aren't a good fit.

Continue reading Entrepreneur's Journal: Getting real advice for your business

Entrepreneur's Journal: Getting real advice for your business originally appeared on BloggingStocks on Sat, 10 Nov 2007 15:00:00 EST. Please see our terms for use of feeds.

Amazon.com launches service for small business owners originally appeared on BloggingStocks on Thu, 25 Oct 2007 11:47:00 EST. Please see our terms for use of feeds.

So if big companies have trouble, what about small ones? Unfortunately, hiring a CEO is extremely difficult for any company.

"For an early stage company, the wrong CEO can be costly," said Gordon Gould, the founder and CEO of ThisNext. "Divorcing the executive can mean wasted time, money, momentum and possibly the company itself."

So, if you have doubts about a candidate, it's probably better to wait. "To get the right CEO, it takes time," said Dipanshu Sharma, the founder and CTO of V-ENABLE. "So allocate at least three to four months for the process." Actually, his company recently hired a new CEO.

Sharma believes it is critical to hire a recruiter. "A top-tier venture capital firm recommended a recruiter for us," he said.

And the process was strenuous: "We set up a weekly call with the recruiter and the board/management. Every week we would prioritize the candidate list. After a few weeks, we got candidates that we had initial conversations with. Of those we found that matched our selection criteria, we held several rounds of interviews. In the final process, we flew them to our offices and introduced them to a broader team before finalizing the candidate."

It was also important to spend time on creating a candidate profile. As for V-ENABLE, the company focused on a CEO with:

• Demonstrated success in previous CEO roles
• Team player
• Growth oriented
• Raised capital and has experience in M&A
• Worked in wireless and has relationships with wireless service providers

"Our board and management went through several iterations to make sure we were covering the short term as well as long term needs for the company," said Sharma.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Entrepreneur's Journal: Choosing the right CEO originally appeared on BloggingStocks on Sat, 13 Oct 2007 17:00:00 EST. Please see our terms for use of feeds.

Recently, the New York Times (NYSE: NYT) said it will abandon its premium service -- and just give things away on its website. Even Dow Jones (NYSE: DJ) is thinking of doing the same with wsj.com.

Or take a look at television operators, such as CBS, which are providing free videos of popular shows.

Should your company think about doing the same? When is there a valid business case to be made for giving your product away?

Trynka Shineman, senior vice president of North American marketing for VistaPrint (NASDAQ: VPRT), thinks it can be a savvy move. After all, her company has been successful in giving away its business cards.

"Make sure you have a clearly defined objective for your offer and a marketing plan to meet that objective," said Shineman. "For example, do you want to generate leads? Referrals? Are you trying to cross-sell existing customers new products or services? Are you trying to retain your customers? For example, if you are trying to generate new customers, make sure you have a plan to convert free trials into purchases - that is, including offers for subsequent purchases with the free product. Getting your product into the hands of a potential customer is only beneficial if you turn that potential customer into a customer."

Or consider Spiceworks. The company develops sophisticated IT management software - and gives it away.

The catch? Spiceworks makes money through advertising.

"We wanted to target the small and medium size business market," said Jay Hallberg, the co-founder and VP of marketing at Spiceworks. "We know it's a huge market. The problem is that it can be difficult to get customers. So by making the product free, we got lots of adoption."

In fact, Spiceworks has a user base of over 120,000 users, which is certainly attractive to various advertisers. The company has deals with Hewlett-Packard (NYSE: HPQ), McAfee (NYSE: MFE) and Rackspace

"If you plan on building an ad-based model," said Hallberg, "it's important to start placing ads on the site from the start. If not, you may disrupt the user experience."

Spiceworks initially used Google (NASDAQ: GOOG)'s AdSense system.

Hallberg also recommends: "Make sure you monitor the traffic and get details on your users. This is critical for getting sponsors."

Yet again, Spiceworks uses another Google product to help out -- called Google Analytics. And, of course, it's free.

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar Online Guide to Decoding Financial Statements. He also operates DealProfiles.com.

Entrepreneur's Journal: When it makes sense to give your product away originally appeared on BloggingStocks on Sat, 06 Oct 2007 17:00:00 EST. Please see our terms for use of feeds.

No doubt, Facebook is one of the internet's hottest startups. The company has raised gobs of venture capital, has deals with companies like Microsoft (NASDAQ: MSFT), and is often rumored to go public or be bought out.

The company's founder, Mark Zuckerberg, is just in his early twenties, fresh from Harvard. Over the past few months, several of his recent classmates have made claims that they are the real owners of the Facebook concept.

Such disputes are very common for early stage companies. And it's also common for these companies to be sloppy in protecting themselves from legal claims.

So what can be done?

Continue reading Entrepreneur's Journal: Facebook's lessons on intellectual property

Entrepreneur's Journal: Facebook's lessons on intellectual property originally appeared on BloggingStocks on Sun, 09 Sep 2007 13:10:00 EST. Please see our terms for use of feeds.

Here's how the question is typically posed to me: "I'm in the process of starting a new business. I've developed some new technology -- with patents pending. But I have no experience commercializing new business ideas. So I was able to find a veteran CEO who wants to be a part of the venture. How much equity should I grant?"

There's no easy answer. And there is no rule book. You may be tempted to hand out a lot of your equity to hire the talent you need. But what if your start-up turns into the next Google (NASDAQ: GOOG), eBay (NASDAQ: EBAY), or the latest hot IPO, like VMware (NYSE: VMW)? Might you risk giving away the store?

Over the years, I've talked about equity splits with many pros. For example, last week I discussed the topic with Todd Dagres, a founder and general partner of Spark Capital.

Continue reading Start-up dilemma: How to divide up the founder's equity?

Start-up dilemma: How to divide up the founder's equity? originally appeared on BloggingStocks on Sun, 19 Aug 2007 10:00:00 EST. Please see our terms for use of feeds.