The WHO is much more important than the WHAT

Too much to do all the time, but not getting the results you want? Struggling to reach your customers? Having a hard time getting your message across? Tired of cold calls and chasing leads?

“There is always just too much to do all the time. I don’t know how much longer I can keep this up!” complained a struggling young entrepreneur yesterday. In spite of the fact that he has a good business concept and a great new technology, he is going crazy and considering quitting. In spite of his superman efforts and 70 hour work weeks, his startup business is just not taking off and accelerating like it should.

As entrepreneurs we should all recognize this situation. “Too much to do” usually means that we are attempting to do too many different things, and this is most often a result of an “inability to focus”. Focusing for a startup company is most often a matter of deciding “WHO” you are going to market to and not just “WHAT” you are trying to sell.

Determining the WHO you market to is actually much more important than WHAT you sell. You can have a great product, excellent sales arguments and yet you will still fail to sell if you are chasing all the wrong people. If, however, you truly understand WHO you are marketing to, then you will experience faster success and you will end up with less to do. If you understand exactly who your best customers are, what kind of problems they have, what keeps them up at night staring at the ceiling and what they are most worried about in their own businesses, then it will be easy for you to effectively create, adapt and sell your products or services to them.

The often fatal mistake that many startup entrepreneurs make is to attempt to market to a broad group rather than a tightly focused group. In the case of the entrepreneur I talked with yesterday, he is attempting to break-into a rather large market. A big investor would love this, because the market is huge and the potential earnings are impressive, but the costs and the level of sophistication required to even get noticed in this market is substantial and overwhelming for a startup company.

We explored a different strategy… We looked at how he could attack a smaller market with a much more focused message and offering, then use the rapid success in this smaller market to prove his overall business model, thus driving a powerful wedge into the larger market. For a startup company to succeed in a large market, it requires a different strategy than that which a larger and better-funded company would use. Prove that your basic business model works in a smaller market and it will be easier to get investors to fund your scale-up to larger markets.

Carefully choosing the WHO makes it easy to succeed with the WHAT. Narrow down the WHO to a small, manageable, easy to identify group of customers and you will use less time, money and headache in closing sales. Marketing is not difficult, but it does require focus.

Do you want to figure out how to work less, yet get bigger results? We can help you to develop a better strategy for your business. Contact us and ask how we can do this.

Attention European Entrepreneurs who are seeking investors and funding in 2009! We can put you in the spotlight in front of the very best European investors and venture capital companies. Europe-Unlimited (www.e-unlimited.com) and Xelerator have created a unique, new program to put entrepreneurs on a fast-track to funding. Get your funding in 2009 by contacting us today to learn more. See www.xelerator.com/fast-track

Heart and Soul

I read lots of business plans and I meet with many different companies each week. Not all impress me.

I meet lots of talented engineers who struggle with marketing and I meet plenty of brilliant marketing people who push lousy products. Sometimes I get bored because I want it all. I want brains and beauty, strength and gentleness, speed and agility, vision and attention to detail, heart and soul.

I want to meet highly competitive companies that deliver great products, and insist on excellence – and yet I also want to meet companies that live by their deepest values and put back more into this world than they take out.

I met such a company 2 weeks ago. Asker Produkt is a small business in Asker, Norway where all the work and production is done by employees who are either physically or emotionally handicapped. The company goes to extreme lengths to create work assignments and processes that compensate for the individual handicaps of each worker. Even though this is expensive and time-consuming, the result is that they have the happiest, most devoted group of employees I have ever seen. Anywhere.

But the best part was that their attitude towards the quality of their products is totally inflexible and unyielding. Their philosophy is that the quality of their products can never be compromised and must be the absolute best possible in order to maintain high standards of excellence and the ongoing loyalty of their customers. You cannot push social responsibility if you are selling junk. No matter how hard, you have to do both. Quality and conscience. Only then will your customers fully stay loyal to your products as well as to your ideals.

This is the combination that so many companies lack. Excellence

but also social responsibility. It’s rare, but something that business sorely needs. Heart and Soul.

- RICK SALMON (June 8, 2009)

The inner game of a successful entrepreneur

Being a successful entrepreneur is an inner game. It's all about how you manage your mind and your internal beliefs. In Timothy Gallwey's famous book The Inner Game of Tennis, he pointed out that tennis players are often totally obsessed with external things (the new tennis racket, the tennis shoes, the competition, the weather, etc.). They tend to lose site of the most important factor to being a great tennis player - the inner game - the mental attitudes and internal focus that are necessary to succeed.

Being a successful entrepreneur is no different. It's the inner game that is the greatest challenge, not the external factors that are continually changing. Success for your startup is not really about the economy, or your competition or about the next technology platform. It's about you.

Last week I led a workshop in Prague for a group of 48 experienced entrepreneurs. I asked them a simple question -

"What are the most important traits that a successful entrepreneur must have?"

Here is their list:

1. Passion & Enthusiasm in what you do
2. The Belief that you will succeed
3. The ability to keep a clear Vision of a successful future
4. Determination and Persistance
5. The ability to Motivate yourself and others
6. Salesmanship & the ability to be Persuasive
7. Effective communication and good Negotiation skills
8. The ability to be a Leader
9. The ability to Listen
10. Keeping focus on the Customer
11. Hiring the right people (and knowing how to identify them)
12. The ability to manage scarce resources effectively
13. A supportive family and balanced lifestyle
    
14. Focus and the ability to Deliver (making a good idea work)

So take 2 minutes and examine your own situation as an entrepreneur. Which of the items in the list accurately describe you? Look at the list and honestly appraise yourself. Are there one or two areas that you need to strengthen in your own character? What would the effect on your startup business be if you did this? Just ponder this for a moment...

What if you were a tennis player and you discovered you needed help with a certain aspect of your game, for example, your backhand. Wouldn't your personal coach setup a training plan designed to strengthen your backhand? If you discover areas of your inner entrepreneur game that need strengthening, don't just think about it. Take action. One action might be to hire a personal coach. Hire the best one you can find and then make massive progress in this area. You will be surprised with the results.

Let the old trees die

While the global finance crisis might be showing some signs of improvement, the outlook for the entrepreneur is still bleak. Without easy access to capital, entrepreneurs cannot grow. A forest without new growth will age quickly just like an economy without new growth will fall. While governments around the world are busy propping up old businesses in order to save jobs, they might just be missing an important point. Old forests are supposed to die in order to make way for the new.

This weekend I read about Joseph Schumpeter, a Czech economist who was a professor at Harvard for over 30 years. His theory was that there is a process he called Creative Destruction, in which after a long period of growth, a crisis must arise. Each crisis creates its own new dynamics and as a result, new technologies will emerge or be used in a new manner. As a result of this, entrepreneur activities will increase, new companies will start and some of the old companies will die off. The old professor believed that this is a natural cleaning process, especially after long periods of sustained growth, and it is necessary because it creates a capacity for new growth.

Early-stage entrepreneurs must have access to capital in order to survive. During the internet boom of the early 1990's we learned that giving huge amounts of money to young and inexperienced entrepreneurs is like inviting the local Hell's Angels group to your house for an all-you-can-drink free beer bash. They will probably drink you dry and trash your house in the process. Even if in small amounts, early-stage entrepreneurs must have access to capital in order to keep their dreams alive and to meet simple milestones for solid growth.

For the representatives from local government who are reading this article, please keep the programs alive that give small loans and grants to early-stage entrepreneurs. Make it easier for them. You can also encourage companies that assist startups by offering them tax breaks and incentives. Make certain your local new growth economy is getting help so that it does not wither and die. When your big old trees come crashing to the ground, it is only the new growth that will sustain you.

For the entrepreneurs who are reading this article, don't give up. This crisis will also pass. They all do. Whether it takes 6 months or 2 years, if you keep your dream alive, you will be positioned for rapid growth when the smoke clears. Get help from companies that promote meetings between local governments, entrepreneurs and venture capital. Keep the faith. Help is on the way.

Smashing Barriers

When working with a startup business there are times to go slow, to create strategies, to contemplate and to carefully evaluate things...
Then there are other times when you need blazing speed and decisive action in order to make huge progress and to smash barriers in your way.
The following is from Seth Godin's excellent blog on marketing and life.
(see http://sethgodin.typepad.com)

Sprint!

The best way to overcome your fear of creativity, brainstorming, intelligent risk taking or navigating a tricky situation might be just to sprint.

When we sprint, all the internal dialogue falls away and we just go as fast as we possibly can. When you're sprinting you don't feel that sore knee and you don't worry that the ground isn't perfectly level. You just run.

You can't sprint forever. That's what makes it sprinting. The brevity of the event is a key part of why it works.

"Quick, you have thirty minutes to come up with ten business ideas."

"Hurry, we need to write a new script for our commercial... we have fifteen minutes."

My first huge project was launching a major brand of science-fiction computer adventure games (Ray Bradbury, Michael Crichton, etc.). I stopped going to business school classes in order to do the launch.

One day, right after a red eye flight, the president of the company told me that the company had canceled the project. They didn't have enough resources to launch all the products we had, our progress was too slow and the packaging wasn't ready yet.

I went to my office spent the next 20 hours rewriting every word of text, redesigning every package, rebuilding every schedule and inventing a new promotional strategy. It was probably 6 weeks of work for a motivated committee, and I did it in one swoop. Like lifting a car off an infant, it was impossible, and I have no recollection at all of the project now.

The board reconsidered and the project was back on again. I didn't get scared until after the sprint. You can't sprint every day but it's probably a good idea to sprint regularly.

So what are you going to do to accelerate your company today?

Join Xelerator and other entrepreneurs in a free online meeting where you can learn more about this and other tools to accelerate your startup business. Click here for more information.

Xelerator. Don't leave your success to chance.

Xelerator client RPR wins prestigious European Venture Award

Xelerator Backround Info: RPR Technologies has been an Xelerator client for the past 3 years. In 2006 Rick Salmon took over as CEO for RPR in order to help the founders get their patented prototype on the market. The first thing Xelerator did was to assemble a professional Board of Directors and to raise the initial seed financing needed to launch the company. By the end of 2006 the first products were shipped and in 2007 the company passed breakeven. Today RPR employs 6 people, has established sales channels in N.America and W.Europe and has been publically recognized as an exciting and growing young Norwegian business. As part of a strategy to position the company with potential investors, RPR entered a series of venture competitons in August 2008. After winning both "Best Presentation" and "Best Elevator Pitch" awards in the qualifying rounds, RPR qualified for the finals of the EURECAN EUROPEAN VENTURE CONTEST and went on to win the award in the Cleantech category. Note that this is a strategy that Xelerator would recommend for all startup companies. If you are interested in learning more about how to succeed with this type of tactic, contact Xelerator today.

Norwegian company wins prestigious award with “Clean Technology"
RPR Technologies wins “Best Cleantech Company” prize in European Venture Awards

(Porsgrunn, Norway - January 13, 2009)
Removing paint from ships and oil platforms is hazardous to the environment and to operators. A new Norwegian technology virtually “peels” off paint instead of using sandblasting or high-pressure water blasting. This is accomplished in a fraction of the time and is so environmentally friendly that the company RPR Technologies was awarded as the “Best Cleantech Company” in the Eurecan European Venture Awards.

RPR Technologies A/S of Porsgrunn, Norway won the Best Cleantech Company award at the recent 2008 Eurecan European Venture Awards contest in Barcelona, Spain. RPR has invented a new technology for removing paint and corrosion from steel surfaces that is significantly cleaner for the environment than the traditional paint removal methods (sandblasting and waterblasting). The RPR machines use a patented process with induction heat to remove paint from steel that is not only cleaner, but also safer for operators and from 2 to 10 times faster than competitive methods, that emit hazardous dust and water waste into the sea and air. The RPR process creates no harmful waste byproducts and allows operators to work quickly, cleanly and safely.

The Eurecan European Venture Award is a multi-stage contest aimed to identify, promote and reward the most innovative early stage companies in Europe. The selection jury was comprised of experts from industry and venture capital and has evaluated the companies on the basis of 7 criteria (business potential, team experience, technology merit, competitive position, investment interest, growth potential and the entrepreneur). In this year’s competition 725 companies registered to compete. 261 companies were selected for the semi-finals and 21 were selected for the finals which were held on December 17 & 18, 2008 in Barcelona. RPR Technologies of Porsgrunn, Norway was awarded first prize in the Cleantech sector.

“Being selected as the top cleantech early-stage company in Europe is a huge honor for RPR. In these times of global financial crisis, it is important that the good young companies get help and assistance in order to grow “ says Rick Salmon, CEO at RPR Technologies A/S. “Not only is our product good for the environment, but it also allows our users to be more competitive financially. We believe that the market for ship and offshore repairs will actually increase in light of the current economic conditions and this technology can help protect industry jobs in countries where labor costs are high.”

About RPR
RPR Technologies manufactures an industrial machine that removes paint and other coatings from steel surfaces using the process of induction heat. This is a unique, cleantech technology that has been patented in 54 countries and competes with the traditional methods of paint removal such as sandblasting and ultra high pressure (UHP) water blasting. The competitive advantages are that the RPR process is CLEANER than blasting (no hazardous airborne or water waste), SAFER for operators (silent, minimal safety equipment required) and FASTER - especially when removing thick difficult coatings (from 5 to 20 times faster). This can result in considerable cost savings for customers. There are four initial target markets; marine, offshore oil platforms, land based oil & gas pipelines, and storage tanks (chemical, oil & water). RPR is based in Porsgrunn, Norway. On September 29, 2008 RPR was also the winner of “Best Presentation Award” at the EVC Cleantech Venture Forum in Linz, Austria.

See the following links for more information (Norwegian Language only):

	NRK.no: Vant europeisk miljøpris (European Environment Award)
	Offshore.no: Miljøpris til RPR (Environment Award to RPR)
	Varden.no: Internasjonal miljø-pris til lokal bedrift (International environmental award to local business)

About the European Venture Awards
For more information about the European Venture Awards see: www.e-unlimited.com
Contact Person: Tanja Baltus, Europe Unlimited, Place Flagey 7, B1050 Brussels, Belgium
Tel: +32 264 33682 Email: tanja@e-unlimited.com

For more information about RPR Technologies A/S, see www.rprtech.com
Contact Person: Rick Salmon Tel: +47 9139 0604 Email: rs@rprtech.com

How to accelerate your startup, even during a recession

If you listen too much to the financial news these days, you can put yourself into a deep clinical depression within about 15 minutes. Most of the experts are predicting global slowdowns and catastrophe scenarios, but how do you adopt a strategy to keep your small startup business afloat? Is it possible to even thrive in a recession?

To accelerate your startup during a recession you must have a
STRATEGY for SURVIVAL and GROWTH.

Here are four tips:

1. Don’t lose your belief and your will to win, even though most others around you are losing theirs… No other piece of advice is more valuable. Guard your enthusiasm and optimism carefully. This is what makes you special as an entrepreneur. Do not let anyone diminish this! The great news is that most people will give in to negative thoughts and walk around with a cloud hanging over their heads. You, on the other hand, will refuse to let this current (temporary) situation affect you and you will have the sunshine on your face at all times. Prospects and customers will notice this and be drawn to you.

2. Have the intellectual agility to quickly adapt… to modify your product or services, to repackage, rename or even reinvent what you are offering to harmonize with the dominant fears and beliefs of the times. During the Great Depression of the 1930s, companies that sold men’s neckties actually increased their sales. When consumers had less money, they put off buying a new suit, but invested in a new tie instead. Have you thought through how your business could adapt to actually benefit from the current situation? Can you change your message or packaging in order to reflect this?

3. Redirect your efforts at better, more likely buyers… (i.e., focus on those buyers that are the least or the last to be effected by the recession). We all have different types of customers. Which of your customers will be less affected by a recession? Look at public (government) spending. Take a look at the companies that are still hiring new employees today. Who are they? What is it about them that makes them less or last affected by the recession? There are clues everywhere. Are you looking carefully enough and are you flexible enough to take advantage of this quickly?

4. Work harder... There is no replacement for this. During tough times, you just have to work harder than the rest. You must be more diligent and follow-up more closely in order to get the optimal value out of every customer lead you get. Keep your optimism (as in point 1), work harder and you will be surprised that even during tough economic times you will survive and even thrive.

Remember that during the biggest crises, come the biggest opportunities.

Team up with others who can help you! Want to discuss this and other issues affecting startup companies with other experienced entrepreneurs? Attend one of our free monthly webinars. See www.xelerator.com for dates and times.

READ THIS before you abandon your startup and take a safe job at a big company

• Frustrated with the news about the economy?
• Should I quit my dream and get a safe job at a big company?
• Is it possible for a startup company to succeed in the current situation?

Read this first.
Entrepreneurs can succeed even during rough economic times.

I started my day today by reading the local business newspaper Dagens Næringsliv. I ended up in the user forum section where I saw the following post:
________________________________________________
Norsk pop duo søker investor
Dagens Næringsliv Forum 22.09.2008
Hansen/Randow - søker investor ! De hadde tdligere i år en hit med låten "stay",som ble produsert av stjerneprodusenten Tommy Denander (jobbet med Eric Clapton Toto ,Westlife o.l) -og de vil nå starte et eget selskap som tar seg av alle hansen/randow`s aktiviteter (cd utgivelser .konserter o.l). De holder på med cd innspilling i Stockholm om dagen med Tommy Denander ,og deres neste singel "frustrated" ble utgitt idag .Video til denne låten ble spilt inn på Svalbard . Duoen jobber også medd mulighet for utgivelse utenfor Norge .www.myspace.com/hansenrandow
________________________________________________

For those of you who do not read Norwegian, it is titled “Norwegian pop music duo seeks investors” and goes on to tell that 2 young pop artists are looking for investors for their new company that will manage their future concerts and CDs. It was also reported that their new single, which will be released today is titled “Frustrated”. OK, I could not help but laugh, and I am not surprised they are frustrated. Many young entrepreneurs are frusrated and also scared due to the recent economic turn of events.

Entrepreneurs are not just frustrated, they are scared
Raising capital will not get any easier during the next year. As Investors batten down the hatches and hunker down for the storm, they will have less liquid capital and be less willing to take on new high-risk projects. This is not great news for small startup entrepreneurs in early stage companies, but economic slow-downs do not have to be impentrable barriers for new enterprises. Nonetheless, anytime is the right time to launch a venture if the opportunity is right and the entrepreneur has assessed the situation correctly. If an entrepreneur is going to launch a company based on solving a customer need that is vague or not clearly defined, then it is always risky, regardless of the state of the economy.
Starting a new business always involves risk, and as we all know roughly 50% of all startups fail within the first 5 years. A tough economy can make a launch even more difficult as loan standards will be tougher and consumer spending weaker. But depending on the nature of your business and location, you might find cost reductions. For example, your suppliers may offer you better deals, rents may be lower, and workers may be more willing to work less. When times are rough, people don't hold out for higher salaries. You can probably hire better people more cheaply now than when the economy is cooking.

Actually benefiting from a bad economy?
You have to balance all the factors to evaluate whether the current business environment will support your new venture. It may even work in your favor. First you have to ask yourself if you have the stomach for high risk and the commitment that you will need as an entrepreneur, then put your good business skills to work. Make sure to shape your opportunity to have a strong business model and a rapid revenue model that accurately assesses costs and the price the market is willing to bear. Focus on a carefully selected, small and manageable niche market. Communicate a solid and unique value proposition that is completely focused on solving specific problems.

During periods of economic downturn, it's not necessarily safer to be with the big companies, but that's the perception. By being small and agile the company is in some respects even safer. The big companies suddenly don't take any risks and retrench and bunker down, whereas the small start-ups are out reinventing new models.

Crisis brings opportunity
During periods of economic downturn, consumers change their habits and strategies. For example, consumers use more time and effor to search for better pricing or higher value. Can you offer a product or service that tailors to this need? In tough times, companies will often postpone the purchase of new IT systems and rather invest money in re-vamping the older systems they have. Can your startup take advantage of this? Try to think clearly about the consequences of the economy and how it will affect your customers. If you are clever enough to have an open mind and to keep looking, you may be surprised with what you uncover. In a crisis things change rapidly, and this presents huge opportunities for creative entrepreneurs.
If you have the idea and you have a vision for it, don't wait for the conditions to be perfect or you'll probably end up waiting forever. There is business out there; it's just a question of who's going to get it.

Free webinar for Startup companies
You are invited to a free, online webinar (telephone & web) on October 15th at 10:00 where a number of startup entrepreneurs (primarily from Norway) will discuss this and other issues. Join us to share your ideas and to learn from what others are doing. You can find more information about this at www.xelerator.com. Sign up today. Space is limited.

Why do startups struggle with sales?

One of the most important survival factors for any startup technology business is the ability to generate sales revenues as quickly as possible. Cash flow is king. The more that an entrepreneur is able to prove to investors that he is a good businessman (able to generate cash flow) then the more credible and believable his entire venture story will be. The quicker a startup business is able to generate some revenues, the less desperate they will be to get funding from investors. The less desperate they are, the more likely that they will succeed in getting funding.

The Devil is in the details. So how can a startup reduce the time needed to generate revenue? In some of the earlier blog posts, I have emphasized the importance of having a small, carefully selected and manageable niche (a description of a group of people or businesses) . If you can define (in extreme detail) exactly the prospective client who is a perfect match for your product, then you will have a higher sales success rate with exactly this type of prospect. The challenge is in the detail of your definition. How specific and exact can you get in your detailed description of this group of prospects?

Small is good. Most entrepreneurs fail to make their niche description precise and exact enough. They do this because they fear that a small niche will not provide enough customers to support their business. This is the fatal error. The smaller and more exact you can make the definition, the greater the likelihood that you will be able to solve their exact problems, and therefore get the sale. The paradox is that even though your local market may only contain one prospect that fits your exact highly-targeted niche, there are many prospects on a global scale.

The King of the Hill. I once heard about a watch repairman who was left-handed. For years he struggled with tools that were designed for right-handed people. Frustration drove him to create a toolset for left-handed watch repair people. When he went out to sell it he could only find one other left-handed watch repairman in his city, therefore his local market was tiny. He did, however, discover thousands of left-handed watch repairmen in a global market. During the first few years he established himself as the recognized leader in the market for left-handed watch repair toolsets. He was the KING OF THE HILL, even though the hill was not so big. Since he had all these loyal, happy, left-handed repairmen as customers, he decided to branch out and sell lots of different tools and other products to left-handed repairmen. Now there were already a lot of competitors in this (larger) market (there always are), but since he already had an established base of customers, he was able to use them to leverage his position in the market. This simple strategy can work for almost any startup company.

So why do so many technology startups struggle with closing sales?

• they fail to define an exact, detailed highly-targeted niche
• they waste effort chasing prospects that are convenient or opportunistic, but not part of their high % target niche
• their sales arguments get diluted because they are chasing many different types of prospects who each have different problems and needs
• their reputation gets diluted because they have failed to differentiate themselves from all the other “generalists” in the market
• they are not focused on solving the unique and obvious problems that their target niche prospects have, but rather general problems
• they fail to talk to members of their target niche and to truly understand the unique problems that their prospects face
• they fall in love with their own technology rather than seeking the solution to the customer’s problems

I challenge you to write a niche description for your startup that is precise and painfully specific. Make your niche small (so that you can dominate it), carefully selected (to take advantage of your unique skills), and manageable (a group that you can identify and locate easily).

Want some help in perfecting this? Contact Xelerator. We can offer seminars, workshops, coaching and consultants to help you with this process.