Top Ten Small Business Ideas

Tags

Small Business, Small Business Ideas

• Newspaper Stand

I know what you are thinking, who in god’s name is still reading newspapers in this day and age. Well you would be surprised just how many people go for the ink-smelling paper, rather than their Smartphone’s – not much really. But still you can sell magazines, encyclopedias, greeting cards etc. It is not a bad business idea if you live in the big city and are wishing for a simple, yet profitable venture.

• Ice Creme Parlor

Who doesn’t like ice-creme? I know I do, but then again I am 300 lbs+, so that is by no means a surprising fact. In fact there are plenty of fat people who would sell their own fingers if they didn’t need them for holding food. As a smart business investor, it is your duty to take advantage of such people (and children) and make money off their gluttony and unhealthy eating habits.

• Pawn Shop

Opening a pawn shop is fast, easy and most importantly – cheap! You basically rent out a store, bulletproof your sales section and watch as the recession victims of your neighborhood gather to give you their precious possessions. And what is best about all of this is that you dictate your own prices; speculating with values left and right!

• Fast Food Joint

Living in such turbulent times, forces people to choose speed and convenience over quality and taste. Opening a subway-style sandwich shop is both easy, because you don’t need to be a professional chef, and profitable – of course that depends on location, competition etc.

• Car Wash

Now this one is kind of tricky, for one must cough up quite a bit of tender in order to get all the equipment associated with running a successful car wash. Of course you can hire illegals to cut expenses, although that is totally depending on your sense of how should one approach the law.

• Chiropractor Studio

No don’t worry; you won’t be getting your hands dirty from rubbing strangers all day, so relax. Opening a chiropractor studio is all about finding a cheap, yet reliable chiropractor to massage customers while you rake in the money.

• Liquor Store

Yes, you might be shot a few times while you first get the hang of operating a handgun, but when all the dust settles you would have one well established venue – calling patrons from all over the neighborhood.  All you need is liquor license and you are all set!

• Retail Outlet

You can sell clothes, shoes, athletic equipment etc. Finding a cheap mall is the best way to go. Having clearance sales every now and again will familiarize the community with your goods. Just keep an eye on those pesky teenagers for they are known to have sticky fingers.

• Barbershop

What is better than shaving hairy men for money? Nothing if you knew how much money barbers make. All you need is a hair-stylist and a studio, but both of those things are abundant and quite affordable. Just remember that convenience is everything, so don’t forget to include a parking area (with a parking meter of course)

• Computer Repairs

You can do either home visitations or open up a shop. Of course if you are like me and don’t know the first thing about computers, it is better to hire some collage boy to ‘help’ you out a little bit. There is a lot of money in computers my friends, so why not get some for you?

Boost Up Your Business by Investing in Personalised Number Plates

Tags

personalised number plates, personalised number registration, personalised vehicle registration

A personalised vehicle registration provides you the opportunity to reflect your personality. You could make a statement about your own through the registration number and thus could put a unique stamp on your car. Since 2001, the number plates offer seven possible character combinations for the car owners. The demand for customised registration is growing up throughout the world in the recent years and at present the car number registrations have turned out to be the status symbol for people.

The plates are sold not just for the sake of fun, but also as an excellent business investment. You could buy the plates at a lesser cost and sell them at a high price or else you could keep the license plate with you throughout your life and transfer it from one vehicle to another. A number registration with a lower combination of characters has a higher value in comparison to the plates with higher characters.

If you are thinking of ordering a personal number plate, let’s check out the advantages for it:

Advertising

The customised registration gives you a great opportunity for advertising. If the name of your company is short or has striking initials, you could make use of them in your car number plate along with the numbers added for identifying your business. For instance, you could make use of ‘SASKO1’ for the CEO. Moreover, you could play with a catchy word describing your service or product like ‘LIONS’ for promoting a game park or ‘TASTY’ for advertising a food product.

While customising your car registration, keep in mind that people have a tendency to look at your vehicle plate twice. Hence, you should make it attractive for your business and also for branding the name effectively in the public eye. The number plate gives you an edge over your competitors by recognizing your business and raising your profile. In order to take an example, a UK plumbing company got plenty of news coverage from its quirky plates ‘LAV1’ and ‘BOG1’ and became the best known plumbing company in the area without any other marketing efforts.

Investment

A popular personalised number plate is often found to change hands at a rate higher than the original cost. In UK a six figure sum has also been paid for purchasing a single plate. For instance ‘VIP 1’ has made a record in the sale of number plates. So always try to think of a word or a name which is in demand. This could provide you a worthwhile price. Furthermore, it could increase your business value if you have ever made the plan of selling it. You should undertake a thorough research work while registering a new personalised number for your car. Make sure of the fact that it matches well with your vehicle and still be in demand after 10 or 20 years.

Amusement

You could also bring a smile to the face of the people through personalised number registration. So while ordering your personalised plate, try to spot a humorous and witty combination of letters. If you pick up something funny and snappy for the vehicle of your company, it could provide a sense of fun to your staffs when they will see your car coming to your office. This jovial mood helps to build up a positive image for your business.

You must check out all the conventions in your area about the permissible combination of letters and numbers. Some states permit seven letters while others limit the combination to only a few numbers and letters. Order personalised number plates from a reliable online source and give a boost to your business in a distinct way.

Top 5 IT Project Management Tips for Small Businesses

Tags

IT Project Management, IT Project Management Tips, Small Businesses management

Your IT department can be an essential and fundamental element of your business’ operations. When it comes down to it, if you run a small e-commerce shop or if you run a business that relies on the power of a systems network, you probably need at least one IT staffer on-call everyday. And no matter if your IT department is one person or five people, you need to find efficient ways to manage their daily tasks. When it comes down to it, your management team should know exactly how to improve your IT department’s workflow, so that your network and system is constantly running – without any backlogs. Here are the top five IT project management tips for small businesses.

1.  Use document sharing platforms and networks. There is a strong chance that your IT department will be updating task documents, filling in time slots, making notes and scheduling meetings. Instead of having a single location in your business where this information is updated, you should use one of the many programs that are available online – programs that allow IT managers to create a file that can be edited and updated by your IT team remotely and from any device.

2.  Set deadlines. Deadlines are critical to have in an IT department, because deadlines will ensure tasks are completed when they need to be completed. For instance, if you have a new fleet of computers from a PC wholesale distributor, you need to schedule a date to make sure all of those computers are set up and operational. The same goes if servers need to be updated or if a troubleshoot call log is backed up. As a manager, it is critical that you make sure that each task is completed in a timely manner and by the time the deadline is up.

3.  Monitor performance. When it comes down to it, you want to make sure your IT department never slacks off. Moreover, you want to make sure that your IT department knows that their performance is being tracked. The reason for this is simple: you want to make sure that your IT department is always doing the best job they can be doing and you don’t want workflow to slow down.

4.  Meet weekly. As you monitor your IT department’s workflow and their performance, you also want to give plenty of feedback. In a positive work environment, you want to give constructive criticism and you want to give employees the skills and knowledge they need to do a better job. However, you also want to encourage employees, especially if they have done a good job. So, you should pick a time out of the week and have a quick back and forth session – almost like debriefing.

5.  Make sure that jobs are clearly defined. There is a good chance that certain jobs will need to be completed – jobs that take specialized strengths. So, from a hiring standpoint, you want to designate these jobs in the very beginning. At the end of the day, having a specialized workforce will make for a stronger IT department and projects will be managed much more efficiently.

Ways that Business Owners Find Time to Relax

Tags

Business

Every business owner is known for how extremely busy they are. They need to often be in more than once place at once, have to make many big business decisions a day, and still need to oversee every operation in the company. This can be overwhelming for anyone and it often times may seem like there are not enough hours in the day to accomplish all of this.

For these reasons, it may seem like you have to work 24/7 in order to be a good business owner. However, everyone needs time to relax and recharge throughout the day to function at the best of their ability. Business owners are not an exception to that rule, but they have to be smarter about the way that they spend their time in order to get the rest and relaxation that they need. Here are some ways that business owners find time to relax.

Plan short breaks throughout the day

As a business owner, you may feel like you need to move a thousand miles a minute in order to keep a good pace for the day, but giving yourself short breaks throughout the day will make the entire work week seem less stressful. These could be short breaks just to walk around your office, meditate, eat a snack or even take some time to talk with a friend. Plan these breaks into your schedule to ensure that you won’t miss them.

Find a mindless activity to do each day

Constantly making big decisions for your company and brainstorming new ways to bring new customers in can be exhausting. To refresh your mind and keep your ideas coming, it is a good idea to devote some time each day to a mindless activity, or at least an activity that does not involve you thinking too much. Watch TV, work on a model airplane, do some yard work. Anything that will allow you to let your mind take a break and just focus your attention on one simple thing.

Take your vacation days

You give your employees vacation days, but if you are like many business owners, you neglect to give yourself the same amount of time off. Give yourself the same amount of vacation days that you would give to your employees and take the time off you need each year. Even taking a few days to get out of the office each year will help you recognize how hard you have been working and what you can do to improve for the future.

Delegate more tasks to your employees

If you want to be a better business owner, you need to master the art of delegating. Find a way to give out tasks to your other employees, so you do not have to take on as much yourself. It may be time consuming at first, because you will need to monitor each person to make sure that the job is getting done, but after a while you will find that you have more time to sit back and watch your business grow and flourish.

8 Internet Business Mistakes to prevent

Tags

Business Mistakes, Internet Business Mistakes

Beginning a company online takes far less assets than attempting to develop a physical retail business or franchise but it’s still effort. Listed here are 8 internet business mistakes to prevent.

1. You do not have a strategic business plan.

Planning is essential for your success when you are beginning your own internet business at home. There’s no ready to use job description suggesting how to proceed every day. Should you start your entire day or week with no plan of the items you will would you can lose many hrs or perhaps times of fluffing around and never really achieving anything. Possess a obvious, and achievable, listing of tasks you need to complete every day.

2. You aren’t organised

You need to remain organised even if your work begins to stack up. Beginning your own internet business at home needs a fair quantity of documents, record-keeping, daily planning along with other essential tasks. Keeping everything organised is crucial.

3. You do not know ways to get clients

After you have your items prepared to sell in your website you can’t just relax and wait for a clients in the future moving in. Make certain you learn all of the right techniques to get clients for your business, as no clients means no enterprise.

4. You do not have anywhere to operate

Make certain you’ve got a spot to work. Don’t leave your company documents and knowledge scattered around your home. You’ll need a spot to keep all this where it will not be lost among other possessions or just misplaced.

5. You are taking advice from buddies and family

Although they may be well intentioned, buddies and family don’t always make reliable business advisors. Separate your web business out of your family and buddies and turn to join a web-based community of compatible entrepreneurs for the business advice.

6. You’re always interrupted

When you’re working, it’s not easy to sit down lower and concentrate in case your phone is continually ringing or maybe you are handling a child or family matter. You have to treat your web business like every other job and hang aside blocks of labor some time and restrict outdoors communication.

7. You’re employed an excessive amount of

Beginning your personal online businesses quite a bit of work. It is extremely tempting to invest every waking moment focusing on finishing tasks. But be cautious that you don’t burn up rapidly. Should you put all your time and energy to your business, you’ll become worn-out and getting nothing left for the family and buddies outdoors of the business.

8. You do not bother to understand new abilities

The internet business community is competitive which is fundamental to keep current using the most advanced technology and you need to know the things that work and just what doesn’t work. Invest a while and assets in mastering from other people who go before you decide to coupled with success.

Purchasing Business — Getting Your organization to another Degree

Tags

Business, Business Development, Purchasing Business

In today’s world, we need to manage all our own fiscal requires. It certainly is complicated to help account for your dollars in case you have a new opening as part of your bank account. Seeing that we all know which money doesn’t grow in timber, so it’s much better our nation discover a way just to save the item, as opposed to totally wasting the item pointlessly.

Immediately after placing a lot of energy inside generating revenue, all of us sooner or later think of trading. Investing is usually a matter pots exquisite facts and also a chance to achieve seem a conclusion. To put it briefly, expense is usually a prepared practice, that buyer receives fantastic positive aspects along with a substantial amount of RETURN in exchange. It’s also known as riches supervision, that involves trading in addition to protecting someone’s money, territory and other important belongings.

The easiest method to embark on this technique can be by simply getting close the perfect enterprise expense company. One common male can’t try without the help of skilled expense supervision solutions. A profitable business expense company can be the one that notifies a person about how to place your own riches in a fashion that a person enjoy the advantages available as RETURN. They then suggest a person specially where to invest your hard earned money, residence or belongings, so as to acquire most of the actual income. They supply solutions pertaining to handling your own belongings such as opportunities, residence and items. The actual support includes specifics, great will probably, money or residence, information and gear. The objective of just about every supervision support is always to offer you greatest profits as productivity through lowest opportunities. It isn’t an easy task to accomplish this goal and a lot of working hard must be carried out to achieve the desired target.

Most of these enterprise expense corporations are a variety of collective expense pay for. Essential great things about trading with your enterprise supervision corporations:

• Then of course you’ll find instant access in your money-

Most commercial companies and regulating body wish a new family savings where by these people acquire interest in excess money whilst nonetheless offering access with small discover. Seeing that your hard earned money isn’t tied up pertaining to very extended, you are able to exploit work from home opportunities after they arise.

• Beautiful, tiered interest rates-

They then offer interesting tiered rates. Furthermore, there is no little balance necessary.

• Considering your own liking or hatred-

They then will probably remember to consider your own interest or repugnance to help pitfalls. Additionally they do the job close to how big is your own capital belongings and will help you match up your own ambitions on time.

• Preserving your time and effort and worry-

They offer a person with advisory solutions that can assist you to help receive a certain amount of moment and headaches, considering they’ve already an even more perceptive understand with the area connected with examine.

Consequently, it is very important that you simply spot your own belongings in the safe hands. You need to be really watchful whilst deciding on your own expense company and as well continue being chary through the moment your own riches is being managed by simply some other person.

Stop Ignoring The Warning Signs. Get Control Of Your Personal Finances With These Tips!

Tags

personal Finance control, Personal finance management, Personal finance planning

There are millions of people that poorly manage their finances. Do you feel as if you don’t manage your finances properly? You can do this situation around. The article below has some advice to help you accomplish your finances under control. Go over this article to see what can be done about your financial situation.

Taking Action

TIP! Buying items on sale can add up to big budget savings. Stop loyal purchasing of certain brands and buy whatever you have a coupon for.

Don’t waste your time and money on get rich quick schemes. This is a trap that Internet marketers often fall into. Learn how to make money the old fashioned way, but taking action is more important that spending all your money on books and courses; taking action is the only way you will actually make a profit.

TIP! No credit repair company can guarantee 100% success in repairing your history. Most companies make blanket statements regarding their ability to fix your history.

Try listing how much you spend on a whiteboard in your room or den. You will pass by it all day so that you can keep the message fresh in your mind.

TIP! Be patient if you want to retain control over your personal finances. The thrill of new technology convinces many people to buy electronics as soon as they are released.

Do not fall for scams promising you a better credit repair organizations can improve your history. A lot of these companies out there make vague statements about how they will repair your credit history. This isn’t accurate since there is no similarity to how your credit score is not identical to another person with credit issues. To guarantee success would be a fraud and they are most likely committing fraud.

TIP! If you are having difficulties paying off a credit card, you should stop charging it. If you cannot find a different way to pay for expenses, at least try to reduce the amount that you charge to the card.

Don’t take out huge amounts on student loan debt unless you expect to be in a position to repay it.If you have not yet chosen a major or mapped out your career path, you should be sure of what you want to do as a career.

TIP! To gain financial stability, you need to have a savings account that you contribute to on a regular basis. Having something to fall back on in an emergency is key to financial stability.

Many spend over $20 weekly trying to win a lot of money from a local lottery drawing, but it makes more sense to put that amount into savings instead.This will ensure you have money.

TIP! Credit cards can be a good alternative to a debit card. Put routine purchases like gas and groceries on a credit card.

If you are under 21 and want a credit card, know that there have been rule changes in recent years. It used to be easy for college-age students to get a credit cards were freely given to college students.Research a card’s requirements before you apply.

Flexible Spending

TIP! If someone wants to buy something but it is too expensive for them to get right away they may be able to involve their whole family. For items that benefit the family as a whole, such as a barbecue grill or a new television, pooling funds together may be just the ticket to finding the money needed to make the purchase.

You should use a flexible spending account to your employer. Flexible spending accounts can be great for covering medical expenses and daycare bills. These kind of accounts will let you put some money to the side before takes to pay for these expenses. However, it is best to consult a tax professional first, so you should consider speaking with an accountant or tax specialist.

TIP! Set up your debit card to pay down your credit card automatically during the last days of the month. This will make sure the bill gets paid even if you forget.

Your FICO score is determined in large part by credit card balance. A higher card balance means a lower score. Your score will improve as the balance goes down. Try keeping the balance below 20% or less than the total allowed credit.

TIP! Paying off any credit cards that have high interest rates should be your priority as you seek to pay down your debt. While you may personally prefer to pay all your debts at the same rate, zeroing in on those with high interest rates benefits you in the end.

You will be a good trader if you know when you should let your profits run. Use in moderation and don’t let greed get in your decision making ability. Once you’ve made profit, you need to know when it is time to withdraw.

The key to having money and be wealthy is to spend more than you bring in. Calculate your total earnings, and shoot to spend much less than that.

Real Estate

TIP! Carry $10.00 cash or a debit card to make small purchases.

Not every debt is bad debt. Real estate can be good investment. Real estate is good because, and in the short term, they increase in value over time and the loan interest is tax deductible. Another example of good debt is college expenses. Student loans have lower interest rates are not repaid back until students have moved past graduation.

TIP! A good month ahead should be a cue to save, not spend. Try to stick to your budget and do not let yourself suffer.

This article shared advice to help you get on track with your monetary future, and you should now be better prepared for what comes next. Look objectively at your finances, implement the tips suggested and you will bring yourself to sounder financial footing.

 

10 key trends shaping the communications agency of the future.

Tags

future communications agency, future marketing trends, Marketing trends

Technology has already dramatically changed the communications industry and the agencies that work in it. Yet an even bigger evolution in the way communications is planned appears to be just around the corner, with technologists and software designers.

By 2016, the advertising industry will largely be considered as much a technology industry as it is considered a creative industry. The communications agency of 2016 will be increasingly considered to be a digital-based agency first and foremost.  And in many of the developed markets, communications agencies will also consider themselves as data agencies. Audience data purchased through data suppliers such as BlueKai will be largely accepted as a commodity – and the bid price will find a market price at which point it offers little value, as per brand terms in Search Engine Maketing (SEM).

AMPs offer night-time vision.However, agencies will take client data and combine it with their pools of existing data and social data to create high propensity segments – therefore increasing the bespoke nature of audiences and increasing the potential scale. This will present an increasing challenge for advertisers and for auditors in terms of assessment. As they do today, teams will bid for data and then bid again for impressions to reach them – they will carry this out within a more evolved form of the Audience Management Platforms (AMPs) that are rolling out now. AMPs are complete ad-management software platforms that merge real-time bidding software with data management dashboards. Incorporated into this will be sophisticated creative versioning technology – so that various combinations of creative can be served and optimised in real-time.

With so many channels incorporated into AMPs, agencies and their clients will begin to have an unprecedented level of visibility and control. As an increasing amount of creative optimisation will be carried out within the system, communications agencies will be at the frontline on creative. Creative agencies will still produce the core advertising ideas – but the execution management will begin to be shaped by the communications agencies. They will control the software that optimises which combinations of assets (headlines, copy-lines, images) run against which audience, at what time of day and where. In some cases, the communications agencies will actually employ copywriters to write copy – in a similar way to how they control the content within SEM. And these AMPs will finally repel the threat of the algorithm-based agencies that will emerge over the next five years.

The emergence of algorithm planning agencies. This new breed of algorithm-based planning agencies that will spring up will steal social ad targeting in a similar way to the SEM agencies that stole SEM work in the last decade. Their core products will be software not people – and they will also offer it direct to advertisers. They will automate the targeting and creative management for social sites – linking directly into their Application Programming Interfaces (APIs). These algorithm planning agencies will be an entirely new breed. They will have come from a software background and will therefore have different paradigms. According to a UK media futurologist, Jean Paul Edwards of MG OMD, algorithmic planning offers the potential to massively reduce friction in all kinds of marketing functions.

Those companies that can integrate these new models of thinking will be very successful over the next decade. Many communications agencies will initially use their software but over time, and as a larger share of spend is invested into social ads, there will be a movement to bring the resource in-house, either through purchasing the companies or through building the capability. It will be the integration of social ads with all of the other activity, within an AMP, that will allow the major communications agencies of 2016 to take back responsibility for social ads.

By YouTube will have an increasing amount of quality video content as it continues to sign up more partnerships with production studios and will have close to 40% of total video views worldwide. They will also have further developed their partnership with Vevo, the music video distribution channel, to sell in-video ads across more than 50% of their total video views. This, combined with other video suppliers, will mean that close to 50% of all video views worldwide will be ad-inventory – which will mostly be bought via an exchange.

This dramatic increase in biddable video inventory, combined with enhanced real-time trading systems, will lead to a media futures exchange – where agencies and/or ancillary groups use algorithms to either ‘long’ or ‘short’ on the future cost of audience data and inventory. If this happens, it may begin to change the role of the media agency to one where it is an active player in the market and not just a middle-man. Forrester Research said that media planners of the future will be like portfolio managers focused on managing risk for their clients.

The beating heart of the communications agency will be algorithm-shaped. There will be a continual movement to get everything into a real-time exchange. The focus will be to automate everything that can be automated and then to upscale their offerings – the maxim of the day will be A&U (Automate and Upscale). There will still be many media channels that will require a manual media buy – media such as traditional TV buying and Outdoor will benefit from some improvements in booking systems, but they will be waiting largely for the real-time bidding wave to engulf them.

More content than ever. Content creation will continue to be a growing up-scaled offering for communications agencies. By 2016, most media agencies will be considered to be ‘full service content agencies’ – carrying out content strategies that, in many instances, carry through to advertising. Also, an increasing amount of innovation is expected in this area – not just with the formats, but also with the business models.

Some agencies and/or production companies may produce content with a clickable layer to more information behind all of the products and services featured – with the sole purpose of gleaning intent-data that can then be used for targeting, or even on-sold to data management companies such as BlueKai. They are also likely to develop ecommerce platforms attached to the clickable layer – so that, for example, the viewer can click on a handbag that a character is holding to find out more, ‘Like’ it and then buy it there and then. Clickable content is a whole new strand of content development which will be incredibly rich and diverse. Innovation will be managed by both creative agency and communications agency, with occasions when they will be pitching against each other. The new role of creative technologist will be to  work with creative teams and/or with channel planners. Their role will be to bring creative thinking to life in a new digital eco-system that includes the consumer.

By 2016, campaign thinking will have universally been replaced by always-on thinking. The launch of new campaigns will result in teams working through the night for several days to monitor and moderate the ‘earned effect’. Social experts will be trained to understand data as well the new emergent forms of group psychology – they will use expressions such as ‘confirmation bias’, ‘herd’, ‘contagion’, ‘gamification’ and ‘catharsis’. They will be equipped and empowered to deal with a negative contagion and to shape a wave of interest into a positive outcome in the moment. These social planners will be an essential part of the strategy team for the conception of ideas – paid investments will be seen as catalysts of earnings. Good social marketing planners will add unprecedented value with their in-the-moment judgements. Some will be the super-stars of the industry.

Leading up to 2016, we will see an increasing amount of interest in agent- based modelling (ABM). ABM allows advertisers to build a virtual network of their entire market. From this, advertisers can try different strategies to see their effect on business performance. Pioneering clients of 2016 will have ABMs and these will give them an advantage over their competitors. Communications agencies will eventually adopt them and feed all of their data into them. Some agencies will partner with external companies and some will take them in-house.

Some things never change. The greatest influence on advertiser performance will continue to be the idea. This will mean that, almost as an antidote to automation, we will begin to see a resurgence in creativity. After the inventory is optimised, the creative component can start to receive an uninterrupted focus. But the focus will be wider than it is today – it will include New Product Development, because by 2016, the canvas upon which creativity can happen will be incredibly rich and diverse. Innovation will be managed by both creative agency and communications agency, with occasions when they will be pitching against each other. The new role of creative technologist will work with creative teams and/or with channel planners. Their role will be to bring creative thinking to life in a new digital eco-system that includes consumers.

Some communications agencies may divide themselves into two halves with one side focusing on upscale services and account management and the automation half being centrally ‘pooled’ within the holding companies. The upscale half will be ultimately on a road to compete with existing creative agencies, whilst the automation half will compete with the algorithm-based software/investment houses. What we will see is an increase in the value that communications agencies add.

Advertisers will spend more time selecting their communications agencies than they do today and than they do with any other agency as the complexity in assessing one against the other will increase. But get the decision correct and the effect on the advertisers’ business will be as, if not more, significant than it has hitherto been with the selection of the creative agency.

10 reasons why brand owners are becoming the new venture capitalists

Tags

venture capital, venture capitalists, venture funding

As new business funding becomes an increasingly vexed issue on a global scale, there are signs that brand owners might prove to be an unlikely new source of capital for start-ups. Stepping into the funding vacuum that surrounds new venture ecospheres a number of global brands are not only financing early-stage companies but even going a stage further, to create ways of linking them into revenue streams and help them become going concerns. In the longer term,  this type of approach to incubating new businesses could bring much needed cheer to many economies because it might help stimulate more firms with high growth potential, which are ultimately the key ingredient of economic recovery.

THE EMERGENCE OF BRAND VC’S

It is no great surprise that the overwhelming majority of new companies don’t seek to raise funds when they start up. New business owners have historically preferred to finance growth from sales revenue rather than borrow money. The business of raising capital is invariably another business in its own right, involving endless rounds of meetings with investment angels and venture capitalists, let alone banks. The time this all takes can be a big distraction from the core challenges of developing products and services and winning customers, which never goes away. So the businesses that persist in the funding game must have something others don’t. More ambition perhaps, a bigger commitment to innovation, a bigger vision of where the opportunity may lie and certainly a bigger appetite for technology – all of which are indicative characteristics of growth. Not surprisingly there’s no shortage of larger organisations who wouldn’t mind some of that but more of them are starting to follow their minds with their wallets.

Amex is banking on Serve

Earlier this month American Express announced that it plans to invest $100 million in technology companies as it develops its digital-payments system called Serve. AmEx will make minority investments in early stage startups developing mobile-payments products. Whilst it has yet to name any target companies, American Express is seeking a bigger foothold in the growing market for internet commerce and payments over wireless devices, competing with Visa, Google and PayPal amongst others. The planned investments will be managed out of an office in Northern California’s Silicon Valley by Harshul Sanghi,who was hired from Motorola Mobility Ventures to spearhead the new initiative. Since traditional financial services companies missed the boat on e-commerce they’re more determined not to let history repeat itself by missing the m-commerce boat too. So this is a smart move by Amex to keep in play with a marketplace that most commentators still believe will be the next great new market of the 21st century.

STARTUPS GET FIZZY

At a less rarefied level there are other examples of brand ventures in play. Drinks giant Pepsico announced it was to partner ten startup businesses that it hopes to use to drive marketing across its portfolio of brands. In summer 2011 the company unveiled the winners of its PepsiCo10 Europe initiative in which 200 firms competed to win £10,000-worth of investment and pilot marketing projects. The winners include Roamler, an app that uses consumers to act as a mobile workforce, enabling them to earn rewards by performing tasks, such as creating branded flashmobs. Although the marketing pilots for each brand are still in the early stages of development, the project is being used as what PepsiCo describes as an ‘engine of change’ across its business. The first work from the winning companies will reach the market by the start of 2012.

Richard of France Telecom

Also in Europe, France Telecom-Orange and the Publicis Groupe (the advertising group) recently announced the launch of a new 150 million Euro venture capital fund to help budding entrepreneurs in Europe’s digital economy. The fund’s targets for investment will be companies focusing on digital technology, content and services, including online marketing, e-commerce, mobile content and services, online gaming and social networks, as well as supporting technologies including middleware, cloud computing, security and online payments. Stephane Richard, Chairman and CEO of France Telecom-Orange said: “French investment capital has been suffering for far too long from the absence of a solid ecosystem to link young companies together with larger groups, research centers and government systems.”

Some might argue that there is nothing especially new about large companies taking stakes in smaller ones and the difference between acquiring a stake in a business and creating a fund for early stage investment isn’t that different in practice. Yet there are signs that instead of simply acting as funding junction for cash-hungry infant tech businesses, brands are becoming more deeply involved in their growth.

RE-THINKING THE PIE

Portland Incubator Experiment

In 2009, Wieden + Kennedy, a US advertising agency based in Seattle, launched the Portland Incubator Experiment, described at the time as a ‘techno-cultural hub’ for a diverse group of Portland-area innovators to bring the startup ethos into ad culture. Whilst the experiment was deemed to be a success and spawned a number of new tech businesses, the company has recently overhauled PIE to create a new iteration of the idea, whereby it can more directly connect its clients to tech innovation via a number of startup awards.

Nine companies, including a finance-focused cloud management platform, have recently been awarded $18,000 in capital, a place to work, as well as access to Wieden’s management and some of the brightest brains in Portland’s tech scene. Perhaps even more importantly they will also get access to some of the agency’s leading brand connections in companies like Coco-Cola and Google, not just in marketing and communications disciplines but also in areas like IT, retail, design and innovation. The executives in charge of the Wieden experiment are in an interesting position as they’ve witnessed first hand that funding is only part of the problem new companies face . “The first time around, we wanted to find interesting companies. We’re (now) trying to create a different kind of platform for collaboration between entrepreneurs, innovators, technologists and some of the worlds biggest brands because we think when those folk come together there’s some really interesting stuff that can come out” said Renny Gleeson and Rick Turoczy (W+K’s global directors of interactive strategy). Wieden will take a small equity stake in the startups but PIE is not designed to be an investment fund.

Is it conceivable that over the next five to ten years we will see the emergence of real brand innovation ecospheres, each hosting a constellation of startups nourished by enterprise capital, connections and collaboration? Like all things, it will depend to some extent on the ROI. It’s probably less likely if the metrics focus too narrowly on the immediate cash returns on offer, which is just as well as cash isn’t the only thing on the table here. Far from it in fact. Bonin Bough, PepsiCo’s global director of digital and social media said: “We are seeing a creative renaissance driven by digital, which is creating a new canvas for brands to communicate through.” PepsiCo investments in technology startups are therefore being seen as part of an ‘engine of change’ across the business and a ‘new driver of creativity’ in marketing. Whilst it’s hard to disagree with this, it may even prove to be something of an understatement. Investing in (digital) startups might help with all sorts of corporate agendas;

• shore up skills in short supply (especially technology ones)
• boost the influence of innovation on corporate cultures
• extend existing product and service offers
• extend collaboration work practices
• accelerate NPD (where larger organisations struggle)
• utilise redundant office space
• inject entrepreneurial zeal
• generate socially positive PR

Above all perhaps startup businesses are good for the corporate soul, like a renewable energy source, which all brands need if they are to evolve and prosper. If by recharging their own batteries brand owners can re-energise new venture investment nobody is going to complain.

Where does one company stop and another start? How alliances shape businesses.

Tags

Business

The question of whether modern businesses have time for classical business strategies is becoming increasingly apposite. Whether or not you subscribe to the view that the future is coming faster than ever before, the world of business is certainly very different from that which existed just a few years ago. The effects can be felt in factories, shops and offices around the world. But they are also to be seen in the halls of academe.

Business school professors are starting to realise that a lot of their assumptions about what governs the success of companies no longer hold true. Not long ago, for instance, Rita Gunther McGrath of the Columbia Business School published “”The End of Competitive Advantage: How to Keep Your Strategy Moving as Fast as Your Business (Harvard Business Review Press)””. Interpreted by many as a challenge to the ideas of strategy doyen Michael Porter, the book essentially describes what many in the field have suspected for a while: that in the fast-moving environment that is modern business the idea of developing a long-term sustainable business strategy is, if not untenable, then at least highly problematic. McGrath’s point is that these days businesses need to be more agile – spotting opportunities quickly, exploiting them and then moving on to the next thing before the market is exhausted and before the competition catches up.

In Network Advantage: How To Unlock Value From Your Alliances and Partnerships (Jossey-Bass), Henrich Greve, Tim Rowley and Andrew Shipilov go further. Rowley, a professor at Toronto University’s Rotman School of Management, told a recent audience in London “the old thinking isn’t working”. Concepts like “the five forces analysis” – the factors Porter used to decide whether a market was attractive or not – were difficult to use as the basis for analysing an industry when the models did not work the way they used to. There was, he said, a “blurring” of boundaries that necessitated a new way of thinking.

The approach he and his colleagues, professors at INSEAD, have come up with is based on the notion that many successful businesses are co-operating with rivals at the same time as competing with them. Indeed, the authors say that data from Thomson Reuters suggests that companies around the world forged nearly 42,000 alliances of various kinds between 2002 and 2011.

But just forming the alliances is not enough. Alliances, like other facets of business, come in various shapes and sizes. For the book’s purposes, they include partnerships and joint ventures, for example. More important, not all are successful, and these failures – said to account for a half of all alliances – can be detrimental to companies’ competitive advantage.

Rowley and his colleagues point out that it is important to realise that alliances do not work in isolation. Such is the complexity of modern business, a company may have several different alliances. “The benefits reaped from an individual alliance depend on the other alliances surrounding the firm – its alliances with other partners, its partners’ alliances with other partners, and the overall network of alliances,” they write. Understanding how each alliance fits into a wider network may increase the chances of success. As they add: “It might not be bad luck or bad timing that takes you down, but a bad alliance portfolio and a bad position in your alliance network.”

Helping companies understand where they should be in the alliance network is at the core of the book. A firm’s prosperity depends on its position in this network – which is a system of alliances interconnecting all firms within its industry and beyond. Indeed, Rowley and co describe the competitive advantage derived from a firm’s ability to obtain three things from the alliance network – information, co-operation and power – as “network advantage”.

There are three “perspectives” to this advantage. The first-degree advantage concerns individual relationships. Two key factors contribute to this – the partners’ compatibility and their ability to complement each other’s skills and knowledge. The second-degree advantage stems from looking at all the partners in the alliance portfolio and at their connections. It is “the unique ability” to obtain timely access to information, secure co-operation, and gain power by using the connectionsbetween the firm’s various alliance partners.

According to Rowley and his colleagues, there are three basic alliance portfolio configurations – hub-and-spoke, integrated and hybrid. Hub-and-spoke is a portfolio with one business at the centre (the hub), with separate connections (the spokes) to each of the other partners, which are mostly not connected to each other. Integrated portfolios are those where the business is connected to partners that are also mostly connected to each other. The hybrid is, of course, a combination of the two, with the business at the centre having some connected partners and some that are unconnected.

One form is not intrinsically better than the others; it depends on what the business is seeking from the alliances. Hub-and-spoke arrangements are considered very helpful for creating breakthrough innovations, while integrated arrangements are more useful where the aim is to establish norms around extensive exchange of information and so are useful in managing complex projects and encouraging incremental innovation. Steve Jobs was seen as a master of the hub-and-spoke network through his ability to learn aspects of one industry and combine that with what he had picked up from an entirely separate connection with another business, as when he developed the iPhone.

The third-degree perspective concerns how a business’s partners share connections to other businesses. Having connections with other well-connected partners will increase a business’s status and hence is attraction to other future partners. One way that a business can increase its allure is by building its brand – through such means as thought leadership campaigns and increased visibility in its industry. But such activities will count for nothing if it has not also gained a reputation as a good collaborator. In other words, business leaders need to make sure they extra benefit from their alliances but they should be wary of being seen as exploitative – something that today’s technology companies might want to bear in mind as they become involved in all sorts of sectors beyond those in which they started out.