Are You Guilty?

Judge Says I'm GuiltyImage via Wikipedia

For not doing things you said you would for your business?  For not being your best self everyday?

Here are some key points that would tell you if you are guilty:

1. You list out your agenda items for the day, don't end up completing them and push some items to next day (huge backlog)
2. You are busy putting out fires and make up some excuse for not calling a customer/sales lead/advisor/investor/your mom back.  Guess what?  You're not too busy to take a few moments to read this now right?  So you have a few moments to call them back.
3. You identify the problem and think GREAT! We're halfway there already.  Well, GREAT, you're ONLY halfway there, so get on it!
4. You offload all the tasks that you don't want to do to your employees.  Hey, I'm not saying that's wrong, because if you're not good at something, I don't want you working in that job either.  Try setting an example though, and try the task yourself - this small thing you do will win the respect of your employees.
5. You don't put your foot down when you say you would.  You have mistaken the part of being "nice" with your contractors and employees and are now getting pushed around by them. I have to admit it's an art to being firm with and respected by your employees and people you work with.  Or you might be on the other end of the spectrum where people call you nasty names for being bonehead aggressive.

I'm sure that there are many other items that you would come up with upon reflection - now write those down and tell yourself you'll NEVER do that again or else...make sure there's a consequence too or else without a downside you likely won't enforce this on yourself.


Here's my kick in the derriere for myself - I am too involved in the day-to-day of the business and not prioritizing correctly.  Ever had that feeling that you worked 100% but only accomplished 50% of what you intended?  Yup - that's what I feel right now.

I think there could be more structure to my day - it's great that everyday I'm challenged with a new problem and meeting new people, so what I mean is structuring my day so that there are specific time slots for each of these activities.  It seriously does enhance productivity.

I'm starting to understand why people need gatekeepers.  I run a small business and get tons of calls not only from customers, people seeking advice, people wanting to sell me stuff, that it's hard to take all of these calls personally.  Apologies but this is the truth - I still give out my direct contact but chances of me picking up on the first try is slim because I'm either in a meeting, on another call or concentrating on doing what I should be doing - running the business.

Let's face it, there are things I love doing and things I hate doing (I am quite extreme like that).  I tend to push things I hate doing, like endless hours of market research and reviewing 500 pages of our patent to the end of my day, and sometimes I push it to next day - GUILTY.  I'm going to stop doing that.  I'm going to stick to the schedule down to the minute and make sure I leave some time at the end of my day to put out fires - deal?  Yes, deal.

This is my shortlist of things I do that is hindering my productivity right now and that I am promising myself to change.  What are yours?

What People THINK They Want

I find it funny - that most people perceive an office with tons of people bustling around to be a sign of stability, efficiency and hard work. 

Contrary to this belief, most of the time these offices are overstaffed, people are looking busy on Facebook and expensing their friend's dinner gathering on the company's tab :)

What's the problem with having a small staff base if things are functioning fine?  Do I really need a CTO, CFO, CMO, CXO, etc. to make it look like we are a credible company?  Sure, I can add an admin person and more salespeople to generate more sales...but then you want me to maintain a store front and incur additional fixed expenses when that isn't your real objection to not signing up - you actually want better prices, faster turnarounds, freebies, insurance, blah blah blah.  Yes. What you are telling us with words really don't match your actions.  If I gave you what you really wanted (if you were kind enough to let us know) then you would buy the service/product; but why throw false objections our way when it doesn't solve the problem? 

Which brings us to how good is traditional market research?  Where we ask people what they want?  Are they really telling us the truth or telling us some BS reason that they know isn't the real reason why they're not putting money where their mouth is. 

I did some work in traditional market research before and now after having run my own business for a 2 years I think these methods need to be modified to reveal the real truth.  Just take for example when we did our initial primary survey, all these students and travelers told us they would buy the service; when we launched we got small businesses and self employed individuals swarming us.  I would say almost zero correlation between the results we got through primary research and actual purchase behavior.

Frustrating. 

Declining Clients that have a High Cost to Serve

Many of you are probably reading this post thinking that it's my company declining clients that cost us too much money to serve.

I actually meant it the other way around - we were declined hosting services because our hosting company didn't charge us for the 90 hours they spent fixing a problem that they caused. They saw that we cost them too much (well if they didn't mess up in the first place we wouldn't have cost them anything more than they expected).

About 2 weeks ago our server was down because of a hardware meltdown. I did mention this in a previous post. We keep backups both at the external host and also internally with our developers. Let's just say it was extremely fortunate that our developers helped us do that (thank you Boris!!! You are our savior!!!) and to our clients - I reassure you that all your information is safe and secure on our backup servers.

So...

We were in the midst of putting together a meeting with the hosting company to get more detail on what happened and discuss a compensation package when we got an email from them indicating that they no longer "desired to provide services to us" and that "I have had my team work about 90 hours for you since the issue arose for a small monthly fee but we did this without complaint or threats of billing you overages typical with any other provider."

I definitely got the sense that I had done something wrong instead of them screwing up the server. I paid for server hosting services and expect it to work. So, if YOU screw up, and need to fix stuff, I am the one to blame? There is no logic behind this since it was written in contract that the down time is a MAXIMUM of 47 MINUTES per year. In our scenario it was more like that multiplied by 100 (yes, really). So, I'm pretty sure this constitutes as a breach of contract, and I get an email saying that you don't want to provide services to me and that I should be thankful you didn't charge ME extra?! My apologies for this post bordering on a rant, but what would you do if this happened to you?

Should all the businesses purchasing hosting services out there be equally afraid that they may suddenly be charged extravagant fees if their server hosting providers fail tomorrow?

If you're reading this and you are a hosting service provider...what would you have done to regain the trust of your customer instead of ending on a sour note?

Getting The Right People on the Bus

There's no easy way but I have found that one factor is critical - that YOU believe in your business and have a vision for where you know it's headed.

Think about it. You are trying to literally "sell" someone to become a part of your team that has nothing but an idea and you're telling them that they can take part in making it a reality.

Here's what's going on in their mind. Do I trust this person to lead the team? Do I think this person has the leadership abilities to exploit the business opportunity? Will other people also want to help out and join the team? Basically, they are evaluating YOUR ability to make it happen.

I can't stress hard enough that you should give them the hard facts up front. You won't get paid a large salary (I'm not even getting paid!) If you expect to help the team succeed you will put tears, sweat (maybe even blood...who knows...maybe you get a paper cut) into building the business. You WILL (and should) lose sleep over it. There is no ONE way to reach the solution (or they may even be multiple solutions to the business problem your team aims to solve). So be flexible, be ready to put in some long hours, and hopefully your new team member will enjoy the ride.

What can you promise them? That they will learn 10 times as fast compared to them sitting in a cubicle somewhere in a large corporation and that those skills will one day be used to build their OWN business. Don't promise a large salary, a ton of equity and perks - because this is NOT what motivates people to work for a start up (of course it plays a part, but the intangibles account for the drive and passion that people feel for building a business).

Good people will realize all of this and stick through it all with the team. It takes dedication, perseverance and believing in the leaders' ability and the vision of the business.

"All things go to those who go after them" - Rob Estes

So dream big and go build not just a good team, but a great team.

Time in the Trenches 4: Team Commitment

Ughhh. The "C" word. I'm sure you all know how important it is to have a great team with people that you trust will deliver great work every time. I'm even more sure that we all know people that are committed to a business work with more passion and deliver results beyond expectations. Some businesses are lucky and the founding team members all decide to stay on to realize the dream, but my scenario was slightly different.

My founding team started with our idea and we saw that it had potential from the favorable feedback that we got from judges at various national and international competitions; then we graduated and the real world hit us - each member had to make a choice between stable corporate life and a start up with possible potential.

Everyone wanted to contribute to a small portion of their time to work on the business. Let me tell you now - part-time contribution does NOT cut it. Do you think you have the greatest idea on Earth? Well if that's seriously what you think...wouldn't you want to contribute every waking moment to realizing your idea? Yes. That's what I thought.

Before you incorporate and try to seriously start a business, make sure that you have the commitment from your entire team; people that want to stay on because there MIGHT be some potential but can't contribute all their effort to it for one reason or another just aren't a fit for a start up business. I know that many individuals have mortgages to pay, kids to feed, etc. but that just means the start up life may not be for them. I'm fortunate that I have a minimum amount of commitments so I can pursue my dream.

The bottom line is that your team should be aligned to building your business 24/7; not when they have spare time.

If you have stories about your business team that you want to share please do post it in the comments!

Time in the Trenches 3: PR Timing

SO. We have aired on Dragons' Den. Yaaaaaaaaaaay.

Now for the crazy number of emails filling up my inbox. Double Yaaaaaaaaaaaaay.

Now reality hits and I'm concerned with my marketing/promotional efforts coming too far ahead of our service launch.

We've received so many emails asking when they can start transacting. What do we do. What do we do? Obviously we can't speed up our development given that we're still in the due diligence phase with the deal. Can we actually go and shop around for other deals right now? (edit: YES YOU CAN. YES YOU CAN. YES YOU CAN!!! We thought we couldn't. Well, at least I learned my lesson early on.)

Lesson Learned: Time your marketing efforts so that it coincidences with some huge event coming up a month or so after it. It would be perfect if we could launch the service next month and start having people transact on it. The publicity from the exposure on the show can only last us so long...my advice is PLAN ahead for publicity/marketing. I'm totally kicking myself that the service isn't "ready to go". I guess the good thing is at least we're taking the time to ensure the quality of our service platform before we throw it out there to you guys?

Time in the Trenches 2: Surviving the Dragons' Den

I think this was one of the critical events for the business - getting onto Dragons' Den. We pitched there, we received an offer and had to keep quiet about it for months while we were going through due diligence. This is when you truly feel how hard it is to keep a secret.

Everyone always asks: "Hey...weren't you on Dragons' Den?"..."How was the filming? Was it scary? Did the Dragons try to tear you apart?"

I actually found the experience a lot of fun; it was different from the other competitions that the business had participated it and of course it would be aired on national television.

I always get the "What did the show do for you?"

It did many things for us. Publicity for one; we were bombarded with emails from interested Beta users right after our session aired on CBC. The downside was that our service wasn't built yet, and everyone expected that it was already up and running. Seriously. We aired less than an hour ago and was made an offer at the same time...we had no problem putting together a prototype in less than an hour ;)

LESSON #1: Don't have the publicity/hype for your business precede your service launch by a LONG period of time. What's good timing? I would think a month of lead time is just right. Of course, it's difficult to time when to receive good publicity.

LESSON #2: As long as you haven't signed an exclusivity agreement which keeps you from shopping around for other investors, make sure that you DO shop around! Just because you're going through due diligence doesn't mean you can't connect with other interested investors and pitch to them as well! More interested investors = more leverage for your business and likelihood of getting a better deal for you (if the interested investors don't team up against you...)

LESSON #3: You might not end up closing the deal. We didn't. It didn't really make sense to give up more than half of our company at that valuation. In fact, I'm still bootstrapping the business right now. I know that start up businesses all need money to operate, but if you can afford it, be picky about your investors...because they will end up being your partners. Can you stand sitting in a boardroom with them for a day and having them call you when business isn't great and asking you where their money is? Always opt for smart money. This means you should find investors that can contribute their relevant expertise and industry contacts IN ADDITION to their money.

So that's what I took away from this experience. Best of luck to whoever is reading this and looking to pitch in the Den!

Time in the Trenches Part 1

University is a great time to dream. Big ideas. Huge opportunities. The ultimate issue is whether you will act to realize these dreams, ideas and opportunities.

It has been 2 years since the original founding team came upon our business idea and things have changed a lot since then. The purpose of this blog is to share with other entrepreneurs our experience in building our start up business. Many of the obstacles that we faced and conquered is not related to the core business but the surrounding elements that are required to keep it afloat (think pulling together an advisory team, drafting a formal shareholder agreement, recruitment people, and probably finding financing is the most tedious task of all).

I hope all of you will enjoy this "Time in the Trenches" series as a good read whether you are a successful, struggling or blooming entrepreneur. Please do share your insights, struggles, comments and suggestions with us as well, since WE are always smarter than just ME.

So the idea was "born" in an undergraduate class 2 years ago, and after receiving favorable feedback at several national and international competitions, the original team decided to give it a go and see if we could make it a reality. A few things I realized in hindsight:

1) None of us had any idea how to run a business.
2) We thought we had a cool idea but had no clear process on how to capitalize on it.
3) Part-Time commitment hinders on progress.
4) We lacked the knowledge of where to obtain advice on building a business.
5) We thought we knew more than we did. Everyone seems to have this "I'm smarter than the average entrepreneur" disease.

The remedies used to solve these issues:

1) Walk. Fall. Pick yourself up and try again. That's most of what it is - but the lucky businesses get advisors who self-identify and help you along. The key is knowing which advisors truly add value; just because someone says they'll help you for free doesn't mean it's always good. Crappy opinions/suggestions can be free as well - be selective.
2) Here are the steps we took:

1. You know the importance of building a great team to drive the business forward. Do this first.
2. Ask your potential customers what they want (DON'T, and I repeat, DON'T, try to build something and assume the world will come knocking on your door)
3. Once you know what they want, build your product/service to tailor to those needs
4. Get your customers to put their money where they mouth is, launch a testing phase to see if they actually PAY for your product/service. If they do - voila! They were telling you the truth about what they wanted! It usually doens't happen so easily and you will need to keep revising the product. Like Steve Jobs said in his book "People don't know what they want until you show it to them."

3) Come on. Common sense. How productive can a team be if they meet once a week to discuss key management decisions? What if a potential customer/partner emails you and says they need your response by tomorrow? Do you tell them your team has other jobs and can't get back to them until the end of the week? Wake up. In business there are two speeds - FAST or DEAD.

4) Network, network, network. An entrepreneur needs to love people. You will be amazed at the amount of knowledge you can pick up from talking to someone that has built their own business before; they can share this with you in about one-tenth of the time you would have to spend researching the same things yourself.

5) Humility. You will be amazed by how much people are willing to teach and share with you. Just keep in mind that every person you meet is teaching you something that can be applied to your business.

So these are the key lessons that I have learned from building PeerFX. Of course there's much more than this, but off the top of my head these are the most important ones. The following posts will be on the processes for the different milestones the business has achieved.

Cheers to our first post! Stay tuned!