Thursday, September 29, 2011

10 Mistakes Growing Companies Routinely Make

Martin Zwilling, Contributor
I provide pragmatic advice and services to entrepreneurs and startups.
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9/28/2011 @ 2:04PM |1,936 views

I’ve been advising and mentoring startups and growth companies for years, … for the sake of growth and survival.  When you try new things, you make mistakes, ... Smart companies learn from their own mistakes, but some don’t pay enough attention to other people’s mistakes.  …[Here] are some common mistakes that seem to happen routinely:

1. Wait until your company is up and growing before you formalize it. …The simple answer is to do something, and start simple. In almost every state, you can incorporate as an LLC with a minimal effort, and a cost in the hundred dollar range. This step shows everyone you are serious, and limits your liability on any mistakes. It also forces you to pick a name for your company and put other intellectual property stakes in the ground.  It’s not that hard to change later to a C-Corp.

1970 Chevrolet Nova CoupeImage via WikipediaCompany and product naming may also seem simple, but should be a key early effort, because mistakes can be very costly. You may recall the Chevy Nova, a compact car from GM. Pundits in Latino countries quickly pointed out that the name, ‘no va’ means ‘does not go’ in Spanish. Professional advice in this area is highly advised. Cultural and religious implications must be very carefully considered.

2. Rely on informal agreements with partners. You may all be friends, or spouses, today, but things do change quickly in the stress of a growing company. The same principles apply to strategic partners. …

3. Quick to hire and slow to fire. … The message here is that if you don’t know exactly what help you need, you probably won’t get it. … On the other end of the process, don’t hesitate to pull the trigger fast when a new hire isn’t working, but don’t forget to be human and follow all the steps. Carrying a non-performing employee probably triples the costs, since you are paying two people to do the job, and at least one other is de-motivated by the inequity.

4. Only hire people who like you or think like you. …  Look for the thoughtful challenge to your ideas, and practice active listening, when you are selling your vision. … Make it a rule to not fraternize with your employees, and choose your partners wisely.

Diagram of the typical financing cycle for a s...Image via Wikipedia5. Be super-conservative on your cash needs. Double-check both the money you need before funding, and the size of investor funding requests.  …You should buffer the first by 50%, and the second by 25%. Severe cash flow problems are a big mistake, and may not be recoverable. When you have people and their families depending on you for their paychecks, and you are strapped for money, there certainly won’t be any money for growth. Even if you can find someone willing to help, it may be a very expensive proposition.  Cash is more important than profit.

6. Let your accountants manage the expenses. … In reality, the most important task of a every small company CEO is to review every expense with a miserly hand before the money flows out. Do not delegate this task. … The result of budget and expense overruns is not only lost growth opportunities, but lost credibility and lost support from investors and vendors.

7. Make all the decisions yourself.  …  For a company to grow, the team has to grow, and decisions must be delegated.  …Even early in the startup process, you need someone like-minded but complementary in skills to help you with the startup plans. … Lastly, make good use of your Board Members. One or two “experts” who have “been there and done that” can head off many mistakes and suggest a calm recovery plan for the ones you make.  …

8. Defining the strategy is a one-time process. Assume your initial strategy will be wrong. … Plan for strategy changes by scheduling an adjustment review every month. … Be sure to communicate changes to the team effectively and often, so it doesn’t look like you are making random changes.

9. Let the daily crisis keep you from the “most important” issues. It takes practice and effort to focus on the most important things first. In business, “most important” means time to market, customer service, low cost, and beating your competitors. It also means knowing when to delegate, when to rest, and reserving time for effective communication with your team. If you allow yourself to be driven by the crisis of the moment, you will lose the ability to set priorities and focus on goals. …

10. Ignore the mistakes of others. The biggest mistake of growing companies is failing to learn from the mistakes of others, or even from your own mistakes. … Wise people admit their mistakes easily, and move the focus away from blame management and towards learning. The …reality is that making mistakes is part of every successful growth effort.  … But the one unforgivable mistake you should never make is to repeat a previous mistake. …
Martin Zwilling
I am the Founder and CEO of Startup Professionals, a company that provides services to startup founders around the world. My background includes a 30-year track record as an executive in general management, computer software development, product management, and marketing. I'm now in "give-back mode" as a mentor to startup founders, and an Angel investor. My experience with investors includes roles on the selection committee of two local Angel groups, and working from the other side of the table with several VCs in Silicon Valley. In addition to blogging, I recently released my first book titled “Do You Have What It Takes To Be An Entrepreneur?” You can contact me directly at .
The author is a Forbes contributor. The opinions expressed are those of the writer.
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Thursday, September 15, 2011

Negotiating in a Nutshell

Harvey Mackay Blog
by Harvey Mackay


Here are some ... rules of the road:

  1. Never accept any proposal immediately, no matter how good it sounds.
  2. Never negotiate with yourself. ...
  3. Don’t raise a bid or lower an offer without first getting a response.
  4. Never cut a deal with someone who has to "go back and get the boss’ approval." ...
  5. If you can’t say yes, it’s no. Just because a deal can be done, doesn’t mean it should be done. ... 
  6. Just because it may look nonnegotiable, doesn’t mean it is. ...
  7. Do your homework before you deal. ...
  8. Rehearse. Practice. ...
  9. Beware the late dealer. ...
  10. Be nice, but if you can’t be nice, go away and let someone else do the deal. ...
  11. A deal can always be made when both parties see their own benefit in making it.
  12. A dream is a bargain no matter what you pay for it. ...
  13. Don’t discuss your business where it can be overheard by others. ...
  14. Watch the game films. ...
  15. No one is going to show you their hole card. ... Clue: Since the given reason is never the real reason, you can eliminate the given reason.
  16. Always let the other side talk first. ...Time...Image by bartek.langer via Flickr
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Thursday, September 8, 2011

Trash To Cash: Mining Landfills For Energy And Profit

Fast Company

BY Ben Schiller Wed Sep 7, 2011

A Belgian company is working on removing the raw materials from dumps, making both energy and building materials out of them, and then redeveloping the land.

[Image: Flickr user D'arcy Norman]

… Dating from the 1960s, the Remo Milieubeheer landfill at Houthalen-Hechteren is a typical dump full of industrial waste and household garbage--16.5 million tons of it in all.
Hardly the sort of the place to get anyone excited.

Except, that is, Patrick Laevers, director of Group Machiels, the Belgian waste management company that owns the site. Laevers has a 20-year plan to excavate the entire expanse, recycling about 45% of its contents, and converting the rest into electricity.

Eventually, … he hopes to turn the site back to nature. What's more, Laevers thinks Houthalen-Hechteren could be the first of many such projects around the world. “We really believe this concept is the future, and that we can all benefit from it,” he says….

Machiels has formed a joint venture with Advanced Plasma Power, a U.K. energy-to-waste company that converts the non-recyclable residue into a mixture of clean-burning natural gas--which generates electricity for 100,000 homes--and a building material called Plasmarok.

Machiels hopes the scheme, which has cost hundreds of millions of dollars, will be fully operational in 2014….

Rolf Stein, CEO of Advanced Plasma Power, says “the mind boggles at the potential” for landfill mining--and not just for energy and recycling. Several companies with landfill sites near cities are looking to reclaim land for property development, he says. …

The concept of mining landfills has been around for years. In the 1950s, the Israelis took soil enriched with waste and spread it over orchards to improve earth quality of the land. And, in the 1980s, some U.S. states farmed landfill material for use in incinerators.

But it has taken rising energy prices and higher demand for recyclables (notably plastic and metals), to make landfill mining viable for companies like Machiels. That, and government support: A key part of the funding for the Houthalen-Hechteren project is coming from renewable energy credits….
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Wednesday, September 7, 2011

12 Things Happy People Do Differently

12 Things Happy People Do Differently
Marc and Angel Hack Life Blog
August 30th, 2011
by Jacob Sokol of Sensophy
Cover via AmazonStudies conducted by positivity psychologist Sonja Lyubomirsky point to 12 things happy people do differently to increase their levels of happiness.  These are things that we can start doing today to feel the effects of more happiness in our lives.  (Check out her book The How of Happiness.) …
  1. Express gratitude. – When you appreciate what you have, what you have appreciates in value.  … We’re gonna have a hard time ever being happy if we aren’t thankful for what we already have.
  2. Cultivate optimism. – …People who think optimistically see the world as a place packed with endless opportunities, especially in trying times.
  3. Avoid over-thinking and social comparison. – Comparing yourself to someone else can be poisonous.  … If you feel called to compare yourself to something, compare yourself to an older version of yourself.
  4. Breakdown of sources of happiness, according t...Image via WikipediaPractice acts of kindness. – Performing an act of kindness releases serotonin in your brain.  … What’s even cooler about this kindness kick is that not only will you feel better, but so will people watching the act of kindness.  …
  5. Nurture social relationships. – The happiest people on the planet are the ones who have deep, meaningful relationships.  …
  6. Develop strategies for coping. – How you respond to the ‘craptastic’ moments is what shapes your character.  …  It helps to have healthy strategies for coping pre-rehearsed, on-call, and in your arsenal at your disposal.
  7. The Satisfaction with Life Index. Blue through...Image via WikipediaLearn to forgive. – …  When you ‘hate’ someone, and you’re continuously thinking about it, those negative emotions are eating away at your immune system.  …
  8. Increase flow experiences.Flow is a state in which it feels like time stands still.  It’s when you’re so focused on what you’re doing that you become one with the task.  …
  9. Savor life’s joys. – Deep happiness cannot exist without slowing down to enjoy the joy.  …  It’s the simple things in life that can be the most rewarding if we remember to fully experience them.
  10. Commit to your goals. – … When you’re fully committed to doing something, you have no choice but to do that thing.  Counter-intuitively, having no option – where you can’t change your mind – subconsciously makes humans happier because they know part of their purpose.
  11. Practice spirituality. – When we practice spirituality or religion, we recognize that life is bigger than us.  We surrender the silly idea that we are the mightiest thing ever.  …
  12. Basic overview of energy and human life (See a...Image via WikipediaTake care of your body. – …  If you don’t have your physical energy in good shape, then your mental energy (your focus), your emotional energy (your feelings), and your spiritual energy (your purpose) will all be negatively affected.  …
Jacob Sokol is committed to living an extraordinary life.  Today he released “Living on Purpose – An Uncommon Guide to Finding, Living, and Rocking Your Life’s Purpose.”  He also loves his mom dearly.
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The FINAL Question


The FINAL Question
By Adam Shaivitz

The following story is great:

During my second month of nursing school our professor gave us a pop quiz. I was a conscientious student and had breezed through the questions, until I read the last one: "What is the first name of the woman who cleans the school?"

Surely this was some kind of joke. I had seen the cleaning woman several times. She was tall, dark-haired and in her 50s, but how would I know her name? I handed in my paper, leaving the last question blank.

Before class ended, one student asked if the last question would count toward our quiz grade. "Absolutely," said the professor. "In your careers you will meet many people. All are significant. They deserve your attention and care, even if all you can do is smile and say hello."

I've never forgotten that lesson. I also learned her name was Dorothy.

--JoAnn C. Jones, Brockville Ontario

Get to know the people whose paths you cross, remember their names, and smile and say hello. ... We meet so many people in organizations who seem to have amazingly strong technical skills and abilities. How do the ones at the top separate themselves? It's often that they have developed the ability to relate to all the people they pass--from the mail room to the board room. A few basic applications from the lesson above:

Smile and say hello. ... Be the person who looks the other person in the eye and smiles with a friendly greeting. You'll be amazed at whom you'll meet, how great it will make you feel, and one day, one of those people will be able to help you.

Gatekeepers. Joel, a successful sales rep with 35 years experience uses the line with gatekeepers: "I know you're really in charge. I'd like to speak with the person who thinks he's in charge." All the time, we hear stories of deals that were won or heavily influenced because of a relationship with someone involved in the process other than the "decision-maker." People buy from people, and they would always prefer to do business with people they like.

Names. ... Multiple studies show that people who use names in conversation are generally seen as being more friendly and likable. Think about the last time someone remembered you and your name, when you didn't expect him or her to. It makes you feel important, because you were memorable to that person. Imagine how much more success you would experience if you made everyone in your network feel that important.

Close out a strong year by taking the initiative to greet people in your path and use their names. You'll be amazed at how you accelerate your performance.


Cover of Cover via AmazonAdam Shaivitz is a well known sales expert. He is the co-author of the best-selling book "Selling is Everyone's Business: What it Takes to Create a Great Salesperson." His company, Accelerate Performance, specializes in sales performance development programs for salespeople and sales managers. You can learn more about Adam at or contact him at

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Tuesday, September 6, 2011

The No. 1 Predictor of Startup Failure: Premature Scaling

Posted on: September 5th, 2011
Joanna Glasner

…The Startup Genome Project … published last week, crunches data from a set of more than 3,200 companies, seeking to identify the qualities that make startups most likely to either succeed or fail.
… The most consistent predictor of failure, …was a startup’s propensity to engage in premature scaling.

What is premature scaling? The authors define it as “focusing on one dimension of the business and advancing it out of sync with the rest of the operation.” For example, a startup may overspend too early on customer acquisition, hire too many employees, or focus too much on engineering at the expense of customer development. …

Researchers at the Startup Genome project, an eight-month-old effort supported by a collection of startup industry insiders and academics, also churned out some other interesting findings related to startup success. Insights include:

Pivoters do better: Switching a core facet of one’s business model, or pivoting, is sometimes the only way a startup can stay competitive in a fast-changing market. …

Diagram of the typical financing cycle for a s...Image via Wikipedia… Researchers found startups that pivot once or twice raise 2.5 times more money, have 3.6 times better user growth, and are 52% less likely to scale prematurely than startups that pivot more than two times or not at all.

Co-founders scale faster: Researchers found solo founders take 3.6 times longer to reach scale stage compared to a founding team of two, and they are 2.3 times less likely to pivot.

Business and Technical Partners Outperform: Teams with one business and one technical founder raise 30% more money, have 2.9 times more user growth, and are 19% less likely to scale prematurely than technical or business-heavy founding teams.

Founders are ridiculously over-optimistic: Researchers found that startups need two to three times longer to validate their [market] than most founders expect. Startups that haven’t raised money, meanwhile, tend to over-estimate their prospective market size as 100 times bigger than it actually is.

Interestingly, while premature scaling is quite common, its opposite, which the authors call dysfunctional scaling, is quite rare. … Curious to see if you’re committing any of these startup sins? The Startup Genome Project has a tool for companies to test whether they are scaling prematurely.
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3 Steps to Handling the Unexpected

Harvard Business Review wordmarkImage via Wikipedia

Harvard Business Review Blog
Peter BregmanPeter Bregman

Peter Bregman is a strategic advisor to CEOs and their leadership teams. His latest book is 18 Minutes: Find Your Focus, Master Distraction, and Get the Right Things Done. To receive an email when he posts, click here.

Trying to predict the future is futile. Instead, be ready to respond. When the unexpected arrives at your door, do these three things:

  • Stop. If you feel pressured to make a decision, stop what you're doing. Give yourself a chance to think before acting. 
  • Assess your options. Don't waste time wishing things were different. Think about the best outcome in the given situation, the information you have at hand, and the available resources. Then lay out your options.
  • Move forward. Based on your new assessment, make a decision and commit. Even if the decision isn't ideal, accept that it's the best under the circumstances.
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