17 Hot Biz Tips for Private Co.s

Posted on | August 14, 2009 | 7 Comments

Welcome to my Guy Kawasaki advice mash-up. These are my take on Guy’s advice for entrepreneurs that he offered during a couple of talks, one he gave at a recent University of Pennsylvania technology conference and the other comes from a series of talks he gave in 2008 for the Montgomery & Hansen‘s online learning site and conference.

Kawasaki started in the tech business at Apple Computers after an early career in sales, and subsequently, he has had a long record as a successful Silicon Valley venture capitalist for he went to become a founder and managing director of Garage Technology Ventures, an early-stage venture capital firm, in addition to being a long time columnist for Entrepreneur Magazine.

The following 17 hot business tips represent a rearticulation of Kawasaki’s advice that I have made more applicable to small and mid-sized private companies using my experiences as a growth company consultant, VC funded biotech entrepreneur, and big bank corporate lender who managed a roster of large and mid-sized commercial & industrial accounts:

1. Focus on them, not you
You can harness the power of the market and your work force when you focus on making meaning for your customers and your employees, not just on making money or a lifestyle for you. That’s because most companies founded to make money fail for they attract the wrong kind of co-founders, supporters and early employees – people who are just too greedy. Instead, focus your company on delivering goods or services that help customers realize things they value like Nike’s aerobic sneakers which cost a few dollars to make and are sold to women seeking efficacy, power and liberation.

2. Make meaning not melba toast
Dry, bland, generic mission statements such as “delivering superior quality products for our customers and communities through leadership innovation and partnerships” may sound good but they help no one. Best are short, focused statements you and your employees can use daily that remind everyone what you want to mean to consumers. Nike stands for delivering “authentic athletic performance,” while FedEx is about providing their customers with “peace of mind.”

3. Don’t settle for being a nose ahead
Staying a little bit ahead of competitors is a risky strategy. Better is to try to come up with innovations that help your company leap ahead. Look for ‘game changer’ developments like how laser and inkjet printers made daisy-wheel printers obsolete. And remember, all goods and services can and need to evolve. Consider such household goods as the can opener or pots & pans. Recently, some bright person invented the horizontal cutting can opener and Allclad is enjoying huge success with its professional-grade tri-metal cookware.

4. Roll the design DICEE
When it comes to product or service design, roll the DICEE – Guy Kawasaki’s acronym for five important concepts:
D is for deep, or thinking about features that go beyond the norm or the minimal, as sandal maker Reef Fanning did by building a bottle opener into the sole of its shoes or how VerticalResponse allows you to create and run marketing campaigns that use not only emails but also snail mail postcards.
I is for intelligence, as seen in the design of Panasonic’s BF-104 flashlight which can use batteries of three different sizes to accommodate the random mix of extra batteries people often have around the house, or in YourWebDepartment.com which lets technophobes and web neophytes create and maintain their own no-hassle, great-looking websites.
C is for complete, or being not just a product, but including support and service.
E, the first one, is for elegance, since functional beauty matters.
E, the second one, stands for emotive, since great products all need to be like those from Harley-Davidson which generate and satisfy strong emotions.

5. Let 100’s of flowers bloom
All companies need innovation to fuel growth. And because you never know from where your innovations will flow, try cultivating many flowers. When you make as many blossoms bloom as possible, you’ll get to see which ones attract the most attention from customers when you test market them. An example of a product surprise is Avon Products’ Skin-so-Soft cream which became popular as a mosquito repellent. Kawasaki also recommends you should “learn who’s buying your product, so you can ask them why, and then give them more reasons to keep doing so. That’s a lot easier than asking people who aren’t interested, ‘why not,’ and trying to change their minds,” he says. Consider this another plug for making sure you’re regularly gathering and evaluating competitive intelligence and market research that’s customed gathered to meet your company’s specific needs.

6. Crap sells, but only early on
Contrary to many with the engineering mindset, innovations don’t have to be perfect to find buyers. Indeed, they can and often do have elements of crappiness in them. Twitter, Kawasaki says, has many flaws, but is changing people’s habits. It is only with time that customers will start demanding better value. It’s when you seek to woo customers away from other products or services that you better deliver a superior value proposition if you hope to attract buyers.

7. It’s OK to polarize people
Trying to be all things to all people ensures you deliver mediocrity. The boxy Toyota Scion xB looks ugly to some people but very cool to its devotees. The key here is make sure you know your market. If you’re not sure, hire a firm like CNi Rapid Research to gather the competitive intelligence you need.

8. Niche yourself
The best products or services are unique and offer value. Successful companies focus on creating separate niches for each high-value offering they have and then they work on expanding them. Remember, even IKEA started as a small furniture seller serving only the Swedish market.

9. Churn, churn, churn
Listen to feedback from customers, and continually improve your product. It’s your best way to churn out new more desirable goods and services. Otherwise you might find your company is in a loosing game that’s just constantly churning its customer base. Doing this can be difficult for innovators, since they often had to ignore naysayers to get their product launched, but it’s really important for long term success. (This is another important plug for the benefits of doing regular competitive intelligence gathering and market research.)

10. Be a viable company
Companies only succeed in meaningful ways when they both deliver real-world positive things for customers and their business model insures they do so at an all-in profit.

11. Be a fundable company
All companies need third party supporters, be they suppliers, external service providers like accountants, lawyers, or payroll companies, or capital providers such as banks, investors. insurance companies, or benefit providers. If your company is in a mess, financially or otherwise, these external parties likely won’t see much reason to trust you or your firm. In such cases, you’ll end up starving for vital resources and support, be it cash or cooperation. And when you can find friends, you’re destined in to fail in some measure and some point in time.

12. Offer clean do-able deals
When the terms of any deal you’re looking to do are clearly outside those generally done, or what is broadly considered fair or win-win in the circumstance, then you’re significantly lowering your probability of getting it done. In circumstances like those, ask yourself the question: who’s wasting whose time?

13. Be lucky
It’s great, even essential, to have plans. But it’s what you do and what happens to you when life takes a different turn (as it inevitably does) that truly defines who you are and what you accomplishment. That’s why being nimble is so important; remember what they say in the army: “all plans go out the window when the first bullet is fired”. Now, what can you do to better guarantee the luck you get is good, not bad luck? That’s easy – manufacture your own! Do this using the formula: luck is when preparation meets opportunity. If you’re properly prepared and parked at the crossroads where opportunities like those you want most likely pass by, you’ll best be primed to seize one when and if it comes your way. Then, if you make sure you use all your intelligence, agility, strength, and skill to jump on those that are right for you and not let them get away, you’ll be able to tell everyone: ‘yes, I’m responsible for my own good luck – I made it happen to me’.

14. Find money using the 10-20-30 rule
When pitching to funds providers like bankers, private equity or venture capitalists, start discussions by using a presentation that has no more than 10 PowerPoint slides, keep the pitch to 20 minutes, and employ a 30-point font size while keeping it simple, focused and very digestible. Also, make sure it focuses on creating images for your audience, and when you do, use as few words per slide as possible so your audience doesn’t have to lots to read when you want them to pay attention to you. Your goal in pitches like these isn’t to ‘knock it out of the park’ by scoring a walk-off home run. The best way to end-up eventually walking home with a cheque is to simply focus on not getting yourself eliminated from consideration. This you can do by making them always feel compelled to want to know more about what you are offering.

15. Make your presentation content count
Here’s how to make your initial 10 slide presentation really count with your audience:

Title: – show your name, the company name, logo and all your contact info
Problem: – state the market problem, size and dimension, your company addresses
Solution: – state your solution, what is does and why people buy
Biz Model: – state how you make money
Magic: – state what magic underlies your offering or what’s the key to its success
Sales & Mktg: – show how you are going to market and how you are driving sales
Competition:- tell what you do and can’t. what they can’t or can in some detail
Team: – explain why your company’s key team members are outstanding
Financials: – give a 1-page summary of the numbers with metrics that drive them
Timeline: – show where the company has been, is now, and where it’s going

16. Show the dogs are eating the food already
In today’s more demanding investment environment, capital providers are looking only to fund growth, not help you get into the game. You’ll need to convince the money guys that what you produce sells if you are to have a realistic hope of getting support. If you are promoting something that’s on the if-come, then best you go to someone or group who knows and sees the market like you do and will buy into your belief that there’s revenue and profits out there for the taking.

17. Drill lots of holes
Lastly, because business is subject to great variability at times, where today’s oil well gusher might easily become tomorrow’s dry hole, best you create lots of prospective alternatives for you and your company by effectively drilling lots of ‘exploratory holes’. You never know when opportunity or need will drive you to shift operations to start mining a new resource. Remember to: fail fast; fail cheap; and fail often, if you want to succeed over the long term.

– by Tony Johnston
Compass North Inc.

Comments

7 Responses to “17 Hot Biz Tips for Private Co.s”

bizsugar.com
August 14th, 2009 @ 12:33 pm

17 Hot Biz Tips for Private Co.s | Biz Money Matters |…

Welcome to my Guy Kawasaki advice mash-up – my take on Guy’s advice for entrepreneurs and CEOs that he offered during a couple of recent talks. These are ideas that can help you get your company’s ‘ducks all lined up’ and your organization ‘firing …
Anita Campbell
August 14th, 2009 @ 3:39 pm

Number 15 is especially good advice, and you articulated it clearly. I’d go so far as to say that’s a good template for a company’s internal business plan. If you can’t state all that clearly for your company, and build a plan of action around it, then you probably aren’t thinking clearly about your business.
Tony Johnston
August 14th, 2009 @ 4:02 pm

Anita, thanks for your comment.

I totally agree. A business plan based on the presentation outline in Number 15 would certainly cover off all the important core matters any company needs to insure it’s clearly pointed in the right direction, keeping pace or beating the competition, delivering solid value add to its customers, and getting everyone pulling together to achieve their goals and make their dreams and aspirations come true. Best thing about taking this approach is: it would be a really clear, simple and straight-forward statement of the company’s game plan that all could easily understand and remember.
Bob Tutunjian
August 17th, 2009 @ 12:58 pm

Very nice set of concise ideas. It’s always good to periodically compare activities against a list like this. By the way, was item #12 omitted due for a reason?
Tony Johnston
August 17th, 2009 @ 6:50 pm

Oops, my fault for leaving out what should have been lucky #13. Update and renumbering is done now, so check “13. Be lucky” and tell me what you think. And by the way, thanks ‘Keen Eyes / Sharpe Mind’ Bob Tutunjian for your helpful comment and positive feedback.
Dawson Lane
August 24th, 2009 @ 10:32 pm

Tony,

Thanks for compiling some super insights from one of my favorites. Kawasaki is excellent at putting ideas forth in short, straight forward, and highly relevant segments.

Well done!
Premium Finance
September 15th, 2009 @ 8:04 pm

Thanks for the tips…

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Tony Johnston
President
Compass North Inc.

Tony provides executive management and advisory services that help companies get MORE !!

sales / profits / cashflow
financing / exit valuation

Tony delivers the leadership or leadership support needed that can make remarkably outstanding results happen operationally, economically, financially and in the eyes of customers, lenders & transaction counterparties.

If you are a decision maker in a company that wants MORE, give him a call at 416-342-5652 or check out the Compass North Inc website [click here].

Tony's ability to help companies achieve important/challenging goals is well demonstrated by his long record of success, which includes:
- 4 successful turnarounds lead
- $66 mil+ increase public
  company's value
- $34 mil value harvested
  from biotech cofounded & lead
  as CEO
- $12 mil/3x investment gain
  in 2 years delivered for
  VC partners
- $2.5+ bil in public & private
  market debt, equity and
  M&A deals done
- 1 successful company IPO
- 4 new businesses organized &
  grown: Biotech; Securitization /
  Mortgage Servicing; Third-Party
  Logistics (3PL); & Consulting