Lesson #269: Want Hard Workers? It Starts With You!

Startups require a lot of hard work, with no rest for the weary.  And, since you need to be moving at light speed to gain first mover advantage, it often means a lot of late nights in close quarters alongside your fellow team members.  Not everyone can thrive in that type of environment.  But, it is important the founding team can, as capital will be tight, and you will need to stretch your human resources as far as you can, without breaking the bank.

RECRUIT THE RIGHT PEOPLE

You want a hard working team?  It all starts with recruiting the right people out of the gate.  In addition to seeing if they have the right skills for the job, you have to see if they have the right attitude and hard work ethic for the job.  And, don’t take their word on it, as everyone will say they have the “right stuff”.  You have to talk to their former employers as references, and have them give you real examples of how they have functioned in that capacity in the past.

FOSTER THE RIGHT TEAM CULTURE

Once you have the right people, now you need to surround them by the right types of hard-working peers.  Create a culture of “all for one, and one for all”, prepared to do whatever is necessary to help the company win the race.  Create realistic targets for them to hit by certain dates, and create a competitive spirit within the company, where people can show off their skills.

REWARD DESIRED BEHAVIOR

When people are showing your desired hard-work ethic behavior, reward them.  Give your key team members a piece of the equity.  Give them a gift certificate to their favorite restaurant.  Take them to a ball game.  Create an employee of the month program.  Do whatever you need to do to make sure they know their hard work did not go unnoticed, and was appreciated by the team.

BE SENSITIVE—DON’T PUSH THEM OVER THE EDGE

All work and no fun, makes Jack a dull boy.  Working around the clock can be exhausting.  And, you don’t want the team to burn out.  After a big sprint, let the team take a day off to catch their breath, and spend time with their friends and family, away from the office.  People are human, and you need to foster an even work-life balance, to retain your team for the long run.

DON’T TELL THEM, SHOW THEM

When you have something that needs to get done, it is important you show the team how to get it done, as opposed to simply telling them to do it.  Don’t leave anything ambiguous, that will leave the team spinning their wheels in frustration, not clear on what you exactly need.  When you show them what to do, that leaves nothing up for interpretation, and will more quickly get you to your desired end product.

HOOK THEM WITH YOUR DAILY BEHAVIOR

And, it all starts with you.  If your employees do not see you putting in the hard work you are asking of them, they will never give it to you.  So, roll up your sleeves, tell your spouse you may be late for dinner, and jump into the mosh pit with your team.  That will help you gain credibility as a leader and camaraderie as one of their colleagues, prepared to jump into the trenches of battle. 

So, as you can see, if you are complaining about not having a hard working team, you really only have one person to blame . . . yourself!!

For future posts, please follow me on Twitter at: @georgedeeb.

Lesson #268: The Art of the Follow-Up

Given how important good selling techniques are to driving revenues, I am shocked how many entrepreneurs and salespeople are just bad at working their leads. This includes things like not following up on leads (or following up too much) and not knowing how to break down barriers, to get the lead to actually listen to your pitch. This post will help you become a master at properly working your sales prospects.

CONTACT THE RIGHT PERSON IN THE FIRST PLACE

If somebody is not getting back to you, often times it is because they are the wrong person in their organization to make decisions about your product or service. So, before you even send your first outreach, make sure the person you are reaching out to has decision making control for your solution. For example, if you are selling a social media management software, it is most likely the head of social media communications at that company—not social media advertising, not their head of marketing, not their CEO, etc. And, if you are unclear who is the right person—ask to be pointed in the right direction, or send outreach to all logical candidates, until you find the right person to engage with you.

MAKE THE RIGHT FIRST IMPRESSION

Another reason people don’t get back to you, is they don’t like what you have to say. Often times salespeople are so excited about the “what” they are selling, that they don’t focus on the more important benefits of “why” a customer would want to buy it. Simplify your pitch to the point you are helping them understand you are selling a need-to-have “painkiller” for their problems, not a nice-to-have “vitamin”. As an example, for the social media management software, it is less about how it integrates with Facebook and Twitter for easy communications, and more about how it will help them double their base of social media followers and help them generate more revenues. So, put on their hat, not yours, to figure out would resonate most with them.

FOLLOW UP IN THE RIGHT FREQUENCY AND RIGHT FORMAT

It shocks me how many times a salesperson forgets to follow up with their old leads. Thankfully, marketing automation software (e.g., Pardot, Eloqua, Marketo, Hubspot) has helped bring automated follow-ups to a formerly manual process. But, you need to know how to program that software with the right business rules. I typically live by the three strike rule within a once-per-week follow-up schedule. So, for example, if you first email them on March 1st, your first follow-up will be on March 8th and your second follow up with be on March 16th. If they don’t get back to you after three tries, it is time to move on, but don’t forget about them. Put them into a long-term nurturing schedule, sending along interesting research or insights that shows them you are smart on their space, for them to want to engage with you in the future. Then you can restart a more direct selling effort again in the following quarter.

And, shake up the methods is which you make your outreach. Email is easy and can be automated. But, it is a lot less personable than a phone call, where they can better hear your voice and personality shine through. And, you never know, you may call and they just might actually pick up their phone. This is particularly effective in the 8-9am or 5-6pm range, while they are most likely in the office, but their assistants are away.

SHAKE UP YOUR MESSAGING

You can only browbeat a person so many times with the same message before it falls on deaf ears. You need to shake up your messaging. Start with an introduction about your business and its benefits to them. If that doesn’t work, send them some interesting market research, that shows you are smart on their space. If that doesn’t work, invite them as your guest to some key industry event. And, if all else fails, everybody loves a free lunch, golf invitation or tickets to the ballgame. An unexpected gift sent to their office also works well, where they will hopefully call to say thank you. Do whatever you need to do, to get them on the phone or to a meeting, to hear what you have to say. Persistence without being annoying is the key here.

BREAK DOWN BARRIERS

It also surprises me that when a salesperson hits a wall, they stop trying, instead of tearing down that wall. For example, if a target lead is not responding to you, try to develop a relationship with their assistant or co-workers. If you get to a dead end with one person in the department, start again with another person in the department. Or, if the CMO won’t listen to your pitch, try calling their CFO to talk about the cost savings or revenue lift they can expect from your product, so the CFO can help you get the attention of their CMO. Or, if there is an entrenched competitor, cut them out of the equation with a materially better price. And, as always, leverage mutual connections -- especially if they are your customers that can help sing your praises as a credible third party. To me, there is no such thing as a dead end -- keep trying until someone gives you a chance.

Hopefully, now you are better armed to put your outreach efforts on steroids -- and drive your qualified sales leads and revenues in the process.  Happy hunting!

For future posts, please follow me on Twitter at: @georgedeeb.

The Case for Hiring a Re-Founder Before You Pull the Plug on Your Startup

Oftentimes, startup entrepreneurs are simply too close to their businesses to get a clear, non-biased look at what may be holding it back from ultimate success. Maybe they lack the required skills or business experience required to identify or correct problems inside their product, process or team. More often that not, as a new entrepreneur  “you just don’t know, what you don’t know.” When the problems become material enough to potentially put the company out of business, maybe it is time to hire what I call a RE-founder to help put it back on the right course.

Read the rest of this post in Entrepreneur, which I guest authored this week.

For future posts, please follow me on Twitter at: @georgedeeb.

Marketing ROI--The Metric That Matters Most To Investors

For all you entrepreneurs trying to attract investment capital, this post will be the most important one you read.  If you cannot answer the following customer acquisition related questions for your target investors, your fund raising process is over, before it even started.  Below will walk you through the inputs required to calculate the most important marketing metric for investors:  your return on marketing investment ("ROMI").

Read the rest of this post in Forbes, which I guest authored this week.

For future posts, please follow me on Twitter: @georgedeeb.

Lesson #267: Score One for Brick and Mortar Retail--An EZContacts.com Disaster Case Study

It is no surprise that the internet has been killing offline retail.  Gone are chains like Blockbuster, Borders, and Sports Authority, to name a few. And, the blodshed is far from over, with chains like Sears, Macy's and JC Penney hanging on for dear life.  They just can't compete with the internet prices, that don't have to cover the huge investment in brick and mortar real estate, inventory and employees.  Is there any retail category that is safe from the internet's death grip . . . I may have found one!!

THE BACKGROUND

I recently needed a new pair of eyeglasses.  I went to my local LensCrafters store for my eye exam and to browse new frames.  But, I did something I had never done before at an optical store, which I always had done in other stores . . . I wrote down the SKU of the frames and started searching for them online when I got home.

And, for good reason.  The same Polo brand frames I has seen at LensCrafters for $250, were available online for half the price of $125 from several vendors I had never heard of.  After doing a little online research, I felt EZContacts.com was worth giving a shot (despite their brand name, as I assumed they started in contacts and evolved into glasses too).  Online they made it pretty simple.  I could easily enter my prescription, they showed me how to measure my pupil distance and gave me a wide range of lenses to choose from.

I picked their most expensive lenses, at $199, assuming they were going to be the best, with all the bells and whistles needed, like anti-reflective coatings, thin construction and crystal clear definition.  I paid for the transaction on March 23, sat back and waited for my new glasses to arrive.

WHAT HAPPENED AFTERWARDS

I got a call the next day from an optometrist that said he worked for EZContacts.com saying that he had my prescription and all looked good, and asked if I had any questions.  I thought that was a nice touch, and I felt that I was in good hands.  Although, I did find it strange that the caller ID came in as a different company name called Sharper Image.  I assumed EZContacts.com had subcontracted the fulfillment to a local optometrist, which was fine given the price savings I was getting.

But, after the 5 business days of advertised delivery time, nothing showed up.  I gave them another week, and called them on April 6th asking why they were more than a week late; as I needed these glasses to see!!  They apologized, said there were abnormally busy, and shipped them out on April 9th, which I received the next day.

Excited to finally get my new glasses, I opened the box and tried them on.  And, I couldn't see clearly through them at all.  The prescription didn't feel accurate.  There was no anti-reflective coating, which distracted my vision.  And, they felt like a crappy lens--with a cloudy haze.  Anything but what I was expecting.

CUSTOMER SERVICE BREAKS

I called to complain, and was greeted by a message that their office was closed on April 11th and 12th for the Passover holiday break (even though every major retail optical chain were open those days).  And, when I called back on April 13th, there was such a back log of customer service calls that I ended up on hold for over two hours behind around 100 other callers.  Probably people like me, disappointed with their purchases??

When I finally spoke to the company, they said to ship them back and gave me a link to their returns page, which was not easily found on their website (forcing me to lose two hours on the phone hunting it down).  It was like they were intentionally hiding it, so people couldn't send back their purchases.  About a week or two after shipping back my glasses, I got a call from their support team saying my lenses were missing the anti-reflective coating by mistake, and that they would send a new pair.  To which I said, I don't really trust you guys anymore with my eyesight, and asked for a full refund, given how bad my customer experience was with them.

But, they told me they could only refund 50% of the $199 lens cost, since they were already cut.  So, I was going to have to eat around $100 for giving this online retailer a chance: an amount that was elevated by the fact I thought I was buying the best lenses possible to avoid exactly this situation.

THE OUTCOME

Given the bad experience I had online, I marched right back into LensCrafters, where I could physically see the quality of the lenses before buying them, and have them professionally measured (as I wasn't exactly sure I was doing it right on my own, from home).  I didn't end up buying new frames, I re-used my old frames to save on the costs, given the above out-of-pocket costs I incurred.  So, instead of getting new glasses and frames for around $300, saving $100 versus retail.  I ended up paying $300 for lenses only, including the $100 I lost from EZContacts.com.  Not the outcome I had in mind by going to the internet to save money.

CONCLUDING THOUGHTS

I may or may not buy frames only online, depending on how high the lenses costs are alone.  The offline retailers are smart--they deeply discount lenses by 50% if you buy frames from them, but you have to pay full price for the lenses if you don't.  So, whatever savings you are getting from buying frames online, you are most likely giving it back in the form of higher lenses prices offline.  So, until an online optical store can more seemlessly replicate the offline buying experience, I think the brick and mortar optical stores will survive to live another day.  Score one for brick and mortar retail, in the sea of otherwise carnage.

WHAT THIS MEANS FOR YOU

If you are in the brick and mortar retail business, you are most likely going to lose on price to the internet retailers every time.  And, price is a huge driver of a consumer's purchase decision.  You are going to have to figure out how to offer something unique and different, that the online guys don't have to compete.  In this case study, that included things like the onsite doctors, physical lenses to look through before you buy (privately branded and unique to them, so you couldn't hunt them down online) and pricing models that make the consumers feel indifference whether they buy online or offline.

And, as for EZContacts.com . . . buyer beware!!  I should have know better to buy eyeglasses from a company branded as a contacts seller.


For future posts, please follow me on Twitter at: @georgedeeb.

Raleigh-Durham Venture Capital Firms & Angel Investor Networks

Below is a list of selected venture capital firms and angel investor networks that are actively investing in the Raleigh-Durham area.  Most are split between a technology or life sciences focus, although many invest in additional industries, as well.  Please research them at their linked websites, to see who may be the best fit for you.  I organized this list in terms of stage of investment focus, from early to late stage investors.  So, please don't reach out to VC's if you do not fit their target criteria.  And, be sure to research their specific technology focus on their websites (e.g., healthcare, education, digital media, SaaS), to make sure your business is a fit for them.  Also, as a reminder, don't blindly cold call these companies.  It is always best to have a warm intro into one of their partners, where Red Rocket or others may be able to help here.

ANGEL INVESTOR NETWORKS IN RALEIGH-DURHAM

Carolina Angel Network --  UNC angels for UNC related entrepreneurs

Carolina Seed Investors --  life sciences focus

Duke Angel Network --  Duke angels for Duke related entrepreneurs

Investors' Circle --  impact investing

RTP Capital Associates --  technology centric, or low-tech execution driven

Triangle Angel Partners --  high tech and life sciences

Wolfpack Investor Network --  NC State angels for NC State related entrepreneurs


SEED STAGE (Up to $250K checks from $0 revenues)

Cofounders Capital --  software focus

Contender Capital --  technology focus

Full Tilt Capital --  technology focus

Inception Micro Angel Fund (IMAF) -- generalists

Madison River Ventures -- ecommerce, SaaS focus

Solidarity Capital Group --  social impact (community dev, economic dev, sustainable agric., energy/environmental, social finance)


EARLY STAGE (Up to $1MM checks in up to $1MM revenues) 

IDEA Fund Partners --  technology focus

Bull City Venture Partners --  software, internet focus


SERIES A STAGE ($1MM-$5MM checks in $1MM-$5MM revenues)

Cato BioVentures --  life sciences focus

Cherokee Investment Partners --  real estate, environmental, energy, others

SJF Ventures --  impact investing


SERIES B  STAGE ($5MM-$20MM checks in over $5MM revenues)

Hatteras Venture Partners --  life sciences focus

River Cities Capital Funds --  healthcare and technology focus

True Bridge Capital Partners --  into funds early or mid-to-late stage direct, tech focus


ALL STAGES

Echo Health Ventures --  healthcare focus

Pappas Ventures -- life sciences focus


STARTUP STUDIOS

Bootstrap Advisors --  consumer products

8 Rivers -- sustainable infrastructure innovations in future-critical areas

Excelerate Health Ventures -- healthcare focus

Golden Pine Ventures --  biotechnology and biomedical focus

Rex Health Ventures --  UNC related, healthcare focus

OTHER NORTH CAROLINA FIRMS WHO INVEST IN RALEIGH-DURHAM

Asheville Angels (seed stage, Asheville)

Blue Ridge Angel Investor Network (seed stage, Asheville)

Charlotte Angel Fund (seed stage, Charlotte)

Double Time Capital (growth stage, Charlotte, sustainable energy)

ECU Investor Network (seed stage, Greenville)

Frontier Capital (growth stage, Charlotte)

Lowe's Ventures (all stages, Mooresville, emerging tech, retail tech, home tech)

North Carolina Innovation Funds (Charlotte, state fund co-invests behind other VCs)

Piedmont Angel Network (seed stage, Winston-Salem)

SunBridge Partners (early stage, Charlotte, technology with global applications)

Wilmington Investor Network (seed stage, Wilmington)


OTHER FIRMS

I would also recommend reaching out to investors outside of North Carolina who are open to investing in the region.  So, research venture investors in the surrounding states in the Southeast.  Or, even further beyond, as I know a lot of Chicago venture capitalists are open to investing in smart companies, wherever they are located, and for the right companies, Red Rocket can make introductions to our relationships there.


For future posts, please follow me on Twitter at: @georgedeeb.