Friday, August 28, 2015

Sell Stories, Not Products

Posted By: George Deeb - 8/28/2015

Most early-stage sales teams lead with their products.  They are typically so excited about their new products, that they get bogged dow...



Most early-stage sales teams lead with their products.  They are typically so excited about their new products, that they get bogged down in selling the minutia of their product’s features and functionality.  They think that is what their clients will care about, and that is what is going to drive a sale.  A common rookie mistake.  As clients don’t really care about you or your products (at this preliminary stage), they care about themselves, and how you are going to help them to solve their problems.

The best sales teams are masters in story telling.  They artistically layout a big picture problem in the industry, that the client is dealing with, and slowly rope them in with their elegant solution to this problem.  It is not until several meetings in does the salesperson even talk about their products.  They only detail them once the client has taken the bait, and they need to set the hook.

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

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


Friday, August 14, 2015

Lesson #213: The Birth of Crowdfunding Agencies

Posted By: George Deeb - 8/14/2015

I have written on the rapid growth of crowdfunding as a financing vehicle for startups .  What I didn't realize, until recently, i...



I have written on the rapid growth of crowdfunding as a financing vehicle for startups.  What I didn't realize, until recently, is that there is a a growing base of agencies that are serving startups that are trying to attract capital through crowdfunding, to help them break out from the crowd of competing companies seeking funds.

As best as I have been able to research, in this up and coming field, some of the leading players in this space include agencies like Fundzinger, Crowdfund Mafia and Agency 2.0.  These agencies are developing an expertise on how to best build and market your crowdfunding pages in a way that will stand out with investors from the clutter of other startups trying to raise monies via the major crowdfunding platforms, like Kickstarter and Indiegogo.

I haven't personally engaged any of these agencies, to be able to speak to their first hand success or not. But, I did recently reach out to one of these agencies to learn more about their business and approach, and I came away impressed with new learnings that I wanted to share with you.

Services Provided.  Launching a crowdfunding campaign is the equivalent effort of launching the startup business itself.  It requires a lot of planning.  The better the page design, the better the product, the better the investor incentives, the better marketing of the page, the better it feels a community is developing around the campaign, the higher odds the campaign will take off.  So, these agencies assist in all of these areas (e.g., page design, video creation, social media buys, community management).

Choose Wisely Between Kickstarter & Indiegogo.  Many agencies prefer to work with Indiegogo, as you can actually speak with their team for support.  Another major difference was the fact Indiegogo allows a partially funded campaign to collect whatever funds are raised, and Kickstarter requires you to get to 100% of your funding goal before any money can close.  That said, that can be a detractor to investors who prefer to only invest, if they are part of a round that allows you to fully hit your fundraising goal (funding your full business need).

First Mover Advantage, Or Not.  Being a first mover in your space can be a major advantage, as you will be showing the crowdfunding investors something new that they have never seen before.  That said, I did recently see a second mover in the space, actually outperform the first mover, since they were able to see what was previously launched and unfunded, improve upon those shortfallings in their product and pitch, and successfully raised funds from there.  At the end of the day, the most exciting products with the most buzz win.

The Timeline.  They suggest you plan well ahead of needing funds.  Assume 6-10 weeks to get ready to launch a successful campaign, depending on the amount of work the agencies need to do to get ready for launch (e.g., setup pages, videos, social campaigns).  Then you will know at the end of the 30-45 day suggested maximum campaign window whether your efforts were successful or not.

Seed Your Campaign With Early Investors Day One.  For best success, your crowdfunding campaign needs to be prefunded to 10% (within the first couple days of launch).  Since nobody wants to be the first money in prepare to have some friends lined up to be first investors in to kickoff the campaign.

Make Sure Campaign Pacing Well Week One.  In addition, they are looking for 30% of campaign goal in place by end of one week.   If you can get to that 30% target within a week, there is a high odds you will get to your funding target by the end of the 30-45 day campaign.

Success Rates.  The agencies suggest the overall crowdfunding industry average success rate is a 30% of companies actually hit their full campaign goal.  And, that the agency can enable you to do much better with their marketing and selective screening of startups, growing the success rate to 50% (although they do not guarantee success).  So, if this is true, the cost of the agency, could be well worth it to increase in the success rate odds.  The flipside is: if your campaign fails with only 50% chance of success, you are out those monies paid to the agency that could have gone into funding your other startup costs.

Be Prepared for Hidden Agency Costs Not Advertised.  Read the fine print.  There a lots of hidden charges, that takes something that looks like a $5K agency price (for PR support and one week of Facebook ads) and turns it into a $20K price (e.g., adding in video creation, page design, additional Facebook budget for remaining 3-4 weeks), and that doesn't even pick up the cost of a human resource (yours or theirs) that will be needed to handle community/social management during the campaign (yes, you will need a person doing this role, in addition to managing your main social community pages for your business).

So, if you have the budgets to afford their services, engaging a crowdfunding agency could be a good way to go, to help you improve your odds of success from 30% to 50%.  Especially since the agency will do most of the heavy lifting required to manage the campaign setup and marketing efforts, so you can stay focused on running your business.

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



Wednesday, August 12, 2015

Are Millennials Wreaking Havoc on Exployers? Or Vice Versa?

Posted By: George Deeb - 8/12/2015

“Help! The inmates are running the asylum!” may be the cry these days running through the heads of many business owners who have multi-g...



“Help! The inmates are running the asylum!” may be the cry these days running through the heads of many business owners who have multi-generational employees. This is to say that owners are struggling with the rapid rise of this younger segment of the workforce, and the way these employees refuse to behave the way their predecessors did -- a scenario creating a wave of chaos in human resources departments. Let me explain further.

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

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


Friday, August 7, 2015

When Picking a Startup to Join, Focus on the Company (Not the Role)

Posted By: George Deeb - 8/07/2015

Startups are really risky.  And, if you are looking to join one, know going in you have a 9 in 10 chance that company won’t be in busine...



Startups are really risky.  And, if you are looking to join one, know going in you have a 9 in 10 chance that company won’t be in business within a couple years from now, and you’ll have to be looking for a new job again.  Venture capitalists can get around these odds, by investing in ten companies, hoping one hits it big, with a portfolio driven mindset.  Unfortunately, you as an employee, only get one “bite at the apple” at a time, since you cannot concurrently work for ten companies.

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

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


Can't Attract VC Money? Buy a Business With Private Equity.

Posted By: George Deeb - 8/07/2015

Venture capital investors are looking for different things than private equity investors. Venture capital firms are typically growth-ori...



Venture capital investors are looking for different things than private equity investors. Venture capital firms are typically growth-oriented, early-stage investors looking for these proof-of-concept points before cutting a check. Private equity firms are typically cash-flow oriented, later-stage investors, looking to invest in companies in excess of $10 million  in revenues and $3 million in EBITDA in size. So, as an early-stage startup, why on earth should you consider reaching out to private equity investors, if you are not making progress with venture capital investors? Because you are going to pitch them with an entirely different growth strategy altogether.

Read the rest of this post in The Next Web, which I guest authored this week.

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


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