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Business Development In A Slow Economy: Small Business Is Where It’s At

April 15th, 2009 By Leave a Comment

Every day layoffs are in the news around the country. No one right now is feeling secure in their job. With the recession in full bloom and housing still in the tank, there will likely continue to be more layoffs. However, in contrast, Internet businesses are enjoying an uptick. The old fashion way of building a small business “brick by brick”, i.e. the brick and mortar way, requires sizable overhead investment. Starting a business online can be accomplished literally on a shoestring. If you’re struggling to make ends meet and unclear about your future, perhaps now is the time to think about building an online business.

It does take some time, understanding and work to get an online business going. However, it will pay off in spades if run correctly. In fact, it could be a profitable venture in a shorter time than trying to build an “offline” business. One way to fund your online business, if you’ve suddenly found yourself unemployed, is to use unemployment benefits to bridge your income shortfall. Of course, consider searching for a “traditional” job in parallel. Craft your strategy correctly, just like you would
if developing any business plan in the traditional world.

There are literally tens / hundreds of thousands of online business. So, it’s clear that you must think outside the box. If you’ve been an account in the past, consider offering online bookkeeping services or consulting with clients for on how to structure their accounting systems. What if you were an application developer in the past, perhaps you can offer your help through online bidding services such as Guru.com or RentACoder.com. These services are great for giving you a baseline of potentially unlimited short-term engagements.

Many people would just brush off building a business online as “too hard.” This is especially true if they’ve never done this before. But, the real question to ask yourself is “what do I have to lose, except time?” Let’s dissect a few of the components. Buy a domain name, build a website or use an existing site / blogging service such as WordPress, and start advertising. You should spend a few hours every night writing about what you enjoy most. Explain to your audience about certain techniques, what actions work best, where to get more information, etc. Once you start, you’ll find it amazing how much knowledge you really do have about the subject.

Of course, you have to realize that regardless of how small your business there will be competition on the Internet. The Internet has something approaching 400 million websites, give or take. But, the beauty of this is that you have the opportunity to check out your competition. You can figure out what they are doing right or wrong and create your own unique products and services.

On the flip side of the coin, if you are not a proficient web designer, you might hire one of these people off of the services listed above: Guru.com or RentACoder.com. These services provide ratings on the coders within their portfolio. It makes it much easier to pick a competent web developer.

Again, just like any business, be sure you know your objectives. The Internet should be a “one-action “model. Don’t confuse the issue with creating too many “personas” or themes about you or your offering. You will end up confusing the audience / paralyzing their thought process and they will end up not buying. Make sure you have quality content on your site, as well.

Marketing will be a key component to a successful launch of your business. I like to say that you can build a website, but if no one knows that it’s there, does it really exist? Remember you ARE competing with millions of other websites. At a minimum, you are competing with thousands of business in your category. How will you stand out? What are your unique selling points? Are you relevant?

Marketing your website is probably the most difficult aspect of starting a small business online. By the time you’re ready to launch your site, you need to be prepared to invest some bucks in bringing your small business to the attention of the world.

In the end; however, this small investment could be the biggest you’ve made to be in control of your own future. This is probably the best time to invest in your tomorrow’s future by developing your own business.

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Joint Ventures Past, Present and Future

March 20th, 2009 By Leave a Comment

It used to be that when people talked about joint ventures, it meant some convoluted, complex, long drawn out business relationship. Everyone was on their pins and needles waiting for legal contracts to be drawn up, lawyer reviews, back and forth negotiations, concessions here and there. Miraculously, one year later, voila, you have a new joint venture. Three months later, the relationship sours for one reason or another and the partnership falls apart.

Joint ventures, of course, are referred to by many different names, not the least of which includes: partnerships, strategic alliances, alliances, etc. No matter what you call it, joint ventures are designed with the intent to create more value from two or more entities than you would have with only one alone.

In my first year at Oracle, I created a joint venture between several technology companies: Oracle, Novell, Intel, Synoptics, etc. We dubbed the joint venture, TIE for The Integrated Enterprise. At the time, integrating solutions from several different technology providers was a difficult task. On top of that, one had to figure out how to train and support customers and resellers. The goal of this joint venture was to reduce the complexities of implementing cross – company technologies.

At Hewlett Packard, we launched a joint venture between Oracle and Hewlett Packard. Customer Relationship Management (CRM) software was blazingly hot and both companies desperately wanted to be in the space. A joint venture relationship was developed, a marketing plan was drafted, a team was assembled, revenue goals were quantified and an execution plan was launched. Both companies benefitted from this collaboration because each leveraged the others core strengths in hardware / professional services and software and support.

Another example of a joint venture in the music industry was when MySpace inked relationships with the big music labels. The result of this venture was to create a new MySpace Music entity where the labels gave streaming and downloading rights to this new entity. The goal of the joint venture is shared advertising revenue, which of course, with 100s of millions of users is an advertiser’s playground.

So, what does the new world of online marketing and profit systems look like? In this new era of Internet and mobile marketing, affiliates rule the playground. The affiliates and, even more so, the super affiliates are the power brokers. Joint ventures are common in this business and move at the speed of, well, the digital network. Those who understand how to work with affiliates will see a multiplicative effect of their marketing dollars.

Joint venture brokers are also gaining in popularity. These are “brokers” who can marry the super affiliates to companies who are looking to jump start their online businesses. This is no trivial pursuit, as it requires, just like in the “offline” world, a strong product, a huge market, a business plan and lots of diplomacy and tact.

Joint ventures can be a great way to accelerate sales, as well as to reduce the complexities of going it alone.

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Why Alliances Are Important To Small Companies

March 11th, 2009 By 2 Comments

Alliances are relationships created between companies to achieve an agreed upon goal. The goal could be to penetrate a country or industry together. It could also be to drive a new product line that was jointly developed. Or, the goal could simply be to complement each other in areas where the other is not as strong.

There are many reasons to develop alliances with other companies. The net result of developing an alliance is to pool resources. This is especially critical if you’re a small company with monetary or geographic limitations. For example, for a small startup company in Silicon Valley, your workforce might be limited to a handful of people and you also might be on a very tight budget. But, your product line might hold great possibilities to be sold in an emerging country, such as Vietnam or Cambodia.

In this example, a company may decide to enter an emerging company by selecting an alliance company that has what they lack. For example, language and geographic presence are obvious reasons to create an alliance. Other reasons could include a large, well-trained work force and rolodex of clients in your prime target area.

Just as importantly, though, is whether the alliance partner can train and support the clients in this geographic region. In fact, this is probably the most important aspect which needs to be addressed up front. While working for Oracle in Asia Pacific, I was tasked to find the build the right alliances in the multiple countries which we served. The upshot of finding strong alliance partners with both training and support expertise is that we spent less time supporting them directly, which translates into less direct costs.

A small company benefits from working with a larger company by leveraging the brand and market reach of the larger company. Using the same example above, Oracle developed alliances with hundreds, if not thousands of small companies, often in the area of systems integration work. The small systems integration company benefitted through association with a brand name like Oracle and the marketing prowess for which Oracle was known.

Strategic alliances are also very important to the success of a small company. Back in early 2000, I was at a hot, but small mobile startup company, called Everypath. At the time we only had 20 employees. Who would want to work with such a puny company? As VP of Biz Dev, I was tasked with signing up strategic partners. Strategic was the key word. Which companies out there would find our technology so compelling that they would build a business practice around our technology.

We proceeded to sign up some of the most prestigious companies, including Accenture, Cap Gemini Ernst and Young, Sun Microsystems, and Hewlett Packard. Not only did these alliances align strategically with us, we also received $20 million in venture capital and financing. This influx of strategic partners was the impetus to drive our company to next level of fund raising to the tune of $100 million. These same alliance partners also worked to drive market awareness and clients for this little 20 person company.

As you can see, alliances can be the catalyst that jumpstarts a company’s market awareness and revenue, if positioned strategically.

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