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A Closer Look: 5 Crucial Phases of Startup Growth

Inc Small Business - Wed, 04/09/2014 - 8:46am

Mohan Sawhney, professor at Northwestern's Kellogg School of Management, recently published a research-based list of five transitions companies need to make in order to scale.

As difficult as it can be to go from startup to viable company, the next transitions in business growth--from small business to midsized one, or from midsized to large--can be even more difficult.

"The organic nature of early-stage growth can often leave companies relying on a handful of talented leaders to handle everything from acquiring new clients to managing functions in an informal, reactive way," writes Mohan Sawhney, professor at Northwestern's Kellogg School of Management, in an article on the Kellogg site. "Once a company achieves a certain size, the needs of the business typically overwhelm these ad hoc approaches."

Here's Sawhney's list of five transitions companies need to make in order to achieve scale:

1. Opportunistic to strategic. "Executives should seek to narrow their markets and focus on targeted customer segments," he writes. That may seem like surprising advice--growing by narrowing your markets--but the idea is to avoid spreading yourself too thin. Many growth companies make the mistake of performing any and all services for any and all customers. That's a great way to grow to a certain level, but it's not scalable. To scale, Sawhney suggests making bigger, bolder bets (but fewer overall bets) in the areas where you anticipate the most demand, growth and profitability.

I asked Sawhney if he could provide a few overarching principles that CEOs could use to determine which segments to focus on--and which ones to drop. He suggested using a simple model that he called the 3 Ms: momentum, margin, and materiality.

"Momentum basically means to what extent are your sales growing, how much traction are you getting, what is the market's response," he explained. Margin is exactly that--the areas in which you have profitability. Materiality is Sawhney's term for the size of the market space. Specifically, you need to gauge how much room you have to grow in a given market space. Say you have $100 million in business in a given space; that's nice, but if the size of that space is $120 million, the opportunity is limited--it's not where you should place your bets.

2. Projects to products. When you're small, you and your team can learn (and make mistakes) at the client's expense. But what happens when your team can't manage every project, all of the time?

The answer, says Sawhney, is to "identify patterns in the delivery of services and then design products based on what can be repeated." If that sounds easier said than done, don't worry: Here's the blueprint 37signals used to go from projects to products.

3. Ownership to partnership. It's common for startups to control every step of the sales cycle, from product development to supply chains to sales channels. To scale, you'll probably need to form partnerships--to reach customers that you don't currently have access to.

I asked Sawhney to assess the risks of a partnership approach. After all, the most powerful partners are likely to be larger entities who don't always have a small business's best interests in mind.

"The first thing to realize is that every partnership is a risk, because your partner can also become potentially a competitor," he said. Another risk, if you're accessing markets through parnerhips, is that your brand is not always in front of the customers--you can get buried behind the brands of other products, or the partner itself.

To some extent, these risks are the inevitable by-product of entering any partnership where the other entity has more power. All you can do, says Sawhney, is exert whatever leverage you have. That leverage might be some protected intellectual property, which prevents the partner from replicating you.

Another form of leverage is relationships: Perhaps you have access to people or networks that a larger entity could benefit from. The best form of leverage is to make sure you have a strong brand that resonates with customers. If customers crave your brand, then larger partners will always be motivated to cooperate with you in a win-win fashion.

4. People to process. At small companies, one key group of gifted employees is usually the driving force. "When this core team can't scale, the shortage of talent can quickly become an impediment to expansion," writes Sawhney. This is why the core team needs "to embed expertise into the company's processes and structure to lessen its reliance on a few key people."

That sounds logical, but executing it is another story. How do you actually go about embedding expertise?

Sawhney's recommendations--software, systems, training programs--aren't surprising. The biggest hurdle, he says, is not the "how" of embedding expertise; it's whether the CEO and leadership team have the self-awareness to let go of their own private savvy, in order to disseminate their know-how throughout the organization. It's not easy, because relinquishing their stranglehold on key knowledge can make the CEO or the leadership team feel as if they are less indispensable.

Moreover, it's usually the founder/CEO's private drive and hunger and knowledge that helped the organization grow from nothing to the point where it's ready to scale. To suddenly act in a different way, for the best interest of the organization, can seem extremely counterintuitive and uncomfortable. "Entrepreneurs are very used to managing everything on the back of napkin and in their head. They are not comfortable letting go of control," says Sawhney. He is fond of the maxim, "You have to let go to grow," as well as its sibling, "You're not going to grow until you let go."

5. Relationships to brands. What happens when important members of your sales team leave the company? For small companies, a big risk is losing the key relationships that drive sales. But the stronger your brand is, the less you're at risk for customer abandonment when a key salesperson departs. "This process involves delinking the brand from relationships while still embodying the critical attributes that the company has delivered in its relationships," writes Sawhney. In other words: Define your brand not only by what it says, but also by what it does. That's the best way to form an enduring--and loyalty-inducing--brand identity.

Categories: Small Business News

10 Ways to Lose Friends and Irritate People

Inc Small Business - Wed, 04/09/2014 - 8:39am

Here are things Dale Carnegie would have said...if he was snarky.

Want to win friends and influence people? Here are 10 things that ensure you won't:

1. You thoughtlessly waste other peoples' time. Every time you're late to an appointment or meeting says your time is more important. Every time you wait until the grocery clerk finishes ringing you up to search for your debit card says you couldn't care less if others have to wait unnecessarily. Every time you take three minutes to fill your oversize water bottle while a line stacks up behind you says you're in your own little world--and your world is the only world that matters.

Small, irritating things, but basically no big deal? Wrong. People who don't notice the small ways they inconvenience others tend to be oblivious when they do it in a major way.

How you treat people when it doesn't really matter--especially when you're a leader--says everything about you. Act like the people around you have more urgent needs than yours and you will never go wrong--and you will definitely be liked.

2. You ignore people outside your "level." There's an older guy at the gym that easily weighs 350 pounds and understandably struggles on the aerobic and weight equipment. Hats off; he's in there trying.

Yet nobody talks to him. Or even seems to notice him. It's like he's invisible. Why? He doesn't fit in.

We all do it. When we visit a company, we talk to the people we're supposed to talk to. When we attend a civic event, we talk to the people we're supposed to talk to. We breeze right by the technicians and talk to the guy who booked us to speak, even though the techs are the ones who make us look and sound good onstage.

Here's an easy rule of thumb: Nod whenever you make eye contact. Or smile. Or (gasp!) even say hi. Just act like people exist.

We'll automatically like you for it--and remember you as someone who engages even when there's nothing in it for you.

3. You ask for too much. A guy you don't know asks you for a favor; a big, time-consuming favor. You politely decline. He asks again. You decline again. Then he whips out the Need Card. "But it's really important to me. You have to. I really need [it]."

Maybe you do, in fact, really need [it]. But your needs are your problem. The world doesn't owe you anything. You aren't entitled to advice or mentoring or success. The only thing you're entitled to is what you earn.

People tend to help people who first help themselves. People tend to help people who first help them. And people definitely befriend people who look out for other people first, because we all want more of those people in our lives.

4. You ignore people in genuine need. At the same time, some people aren't in a position to help themselves. They need a hand: a few dollars, some decent food, a warm coat.

Though I don't necessarily believe in karma, I do believe good things always come back to you, in the form of feeling good about yourself.

And that's reason enough to help people who find themselves on the downside of advantage.

5. You ask a question so you can talk. A guy at lunch asks, "Hey, do you think social-media marketing is effective?"

"Well," you answer, "I think under the right circumstances..."

"Wrong," he interrupts. "I've never seen an ROI. I've never seen a bump in direct sales. Plus 'awareness' is not a measurable or even an important goal..." and he drones on while you desperately try to escape.

Don't shoehorn in your opinions under false pretenses. Only ask a question if you genuinely want to know the answer. And when you do speak again, ask a follow-up question that helps you better understand the other person's point of view.

People like people who are genuinely interested in them--not in themselves.

6. You pull a "Do you know who I am?" OK, so maybe they don't take it to the Reese Witherspoon level, but many people whip out some form of the "I'm Too Important for This" card.

Maybe the line is too long. Or the service isn't sufficiently "personal." Or they aren't shown their "deserved" level of respect.

Say you really are somebody. People always like you better when you don't act like you know you're somebody--or that you think it entitles you to different treatment.

7. You don't dial it back. An unusual personality is a lot of fun--until it isn't. Yet when the going gets tough or a situation gets stressful, some people just can't stop "expressing their individuality."

Look. We know you're funny. We know you're quirky. We know you march to the beat of your own drum. Still, there's a time to play and a time to be serious, a time to be irreverent and a time to conform, a time to challenge and a time to back off.

Knowing when the situation requires you to stop justifying your words or actions with an unspoken "Hey, that's just me being me" can often be the difference between being likeable and being an ass.

8. You mistake self-deprecation for permission. You know how it's OK when you make fun of certain things about yourself, but not for other people to make fun of you for those same things? Like receding hairlines. Weight. A struggling business or career. Your spouse and kids.

It's OK when you poke a little gentle fun at yourself, but the last thing you want to hear are bald or money or "Do you want fries with that?" jokes. (Bottom line: I can say I'm fat. You can't.)

Sometimes self-deprecation is genuine, but it's often a mask for insecurity. Never assume people who make fun of themselves give you permission to poke the same fun at them.

Only tease when you know it will be taken in the right spirit. Otherwise, if you feel the need to be funny, make fun of yourself.

9. You humblebrag. Humblebragging is a form of bragging that tries to cover the brag with a veneer of humility so you can brag without appearing to brag. (Key word is "appearing," because it's still easy to tell humblebraggers are quite tickled with themselves.)

For example, here's a tweeted humblebrag from actor Stephen Fry: "Oh dear. Don't know what to do at the airport. Huge crowd, but I'll miss my plane if I stop and do photos... oh dear don't want to disappoint."

Your employees don't want to hear how stressed you are about your upcoming TED Talk. They don't want to hear how hard it is to maintain two homes. Before you brag--humbly or not, business or personal--think about your audience. A gal who is a size 14 doesn't want to hear you complain that normally you're a size 2, but you're a size 4 in Prada because its sizes run small.

Or better yet, don't brag. Just be proud of what you've accomplished. Let others brag for you.

If you've done cool things, don't worry--they will.

10. You push your opinions. You know things. Cool things. Great things.

Awesome. But only share them in the right settings. If you're a mentor, share away. If you're a coach or a leader, share away. If you're the guy who just started a paleo diet, don't tell us all what to order.

Unless we ask. What's right for you may not be right for others; shoot, it might not even turn out to be right for you.

Like most things in life, offering helpful advice is all about picking your spots--just like winning friends and influencing people.

Now it's your turn. What would you add to the list?

Categories: Small Business News

Did Steve Jobs Lower Your Salary?

Inc Small Business - Wed, 04/09/2014 - 8:22am

Google and Apple colluded to help keep salaries low in the Valley. Now your own workers may be affected.

For years, Google and Apple had a gentlemen's agreement not to poach one another's employees. But now that a class action lawsuit has been filed claiming affected tech workers deserve $9 billion in total--that's billion with a B, not an M--it's clear this wasn't just a Google and Apple thing but something much bigger. Tech companies like Intuit and Pixar were also named in the suit, and now everyone is panicked, as they should be.

Yes, high salaries are a concern for any business, especially startups. And if the free market had been functioning, Silicon Valley salaries may have soared higher than they already have, making it even harder to secure top-notch talent. But it's also likely higher Silicon Valley salaries would have had another result: talent moving to other regions.

Already, up-and-coming tech hubs like San Diego, Denver, and Austin beat out San Francisco as the best places for startups in 2014, according to Forbes. So there's no telling what that list would look like today if Steve Jobs hadn't told Google, "If you hire a single one of these people that means war."

By the way, this wasn't a casual comment made at a tech fair. This was his company's human resources policy. The New York Times relates the content of several of these emails such as this one from Apple HR:

"Please add Google to your 'hands-off' list. We recently agreed not to recruit from one another so if you hear of any recruiting they are doing against us, please be sure to let me know."

Meanwhile, Google CEO Eric Schmidt said he wanted to stop discussing this subject over email, as he was concerned about the legal repurcussions. Let's be honest, what would a jury infer from such a comment? That you were knowingly engaging in illegal activity.

In your own company, the desire to control your external environment is important. After all, this saved Google, Apple, and the other companies involved a boatload of cash by keeping salaries low (relatively speaking). But the expected payout, should the plaintiffs prevail in this lawsuit, will be just as high.

If you want other companies to keep their hands off your employees, the best way to do so is by being a great employer. This means offering competitive salary and benefits, no doubt, but it also involves not being a jerk, offering great opportunities, respecting employees' differences, and perhaps even offering free lunch.

You can go the free-market suppression route, but even Google isn't too big to fail (or lose a lawsuit, though it will take time before things come to light).

Categories: Small Business News

7 Things You Need to Know Today

Inc Small Business - Wed, 04/09/2014 - 8:17am

A roundup of the day's news curated by the Inc. editorial team to help you and your business succeed.

1. Boston's Booming

Boston startups secured more than $1.2 billion in venture financing in 142 deals for the most recent quarter, according to a CB Editorial study. That's the best quarter the city's tech startups have seen since 2009. Wayfair, an online furnishing retailer, raised $157 million ahead of its planned initial public offering, while the biotech, clean technology, and life sciences industries landed most of the financing.--TechCrunch

2. Food for Thought

Sheryl Sandberg makes a darn good point in an interview about her campaign against "bossy": "Next time you're about to call a little girl bossy, say instead that she has executive leadership skills. Everyone laughs. But then I say, think about saying that a boy has executive leadership skills. Nobody laughs. It's not funny! What that points out is how different our expectations are about boys and girls."--San Jose Mercury News

3. Time to Hire a Pro

Penalties related to employment taxes cost businesses $4.5 billion for the 12-month period ending last September, according to the IRS. Small businesses are especially likely to file incorrectly because they are not as well equipped as large companies to keep up with continually changing regulations.--Businessweek

4. Show Me the Money--and the Advice

You don't just want the money. According to a recently published Wharton School of Business survey of 126 startup tech executives, most companies want investors to be able to offer operational advice and help more than they want huge valuations or big-name venture capitalists. If you're looking for capital, make sure they can show you the ropes and not just the money.--Knowledge@Wharton

5. Another Kind of March Madness Bracket

The University of Connecticut may have won the annual NCAA basketball tournament, but it's Comcast who won Consumerist's 4th Annual Worst Company in America Tournament, narrowly defeating Monsanto in the finals. On most days, you may sit there thinking about what it would take to grow your business from SMB size to Fortune 2000 level. On others, you can sit back and be grateful for all the ways that your SMB status (and, of course, your ethical behavior) shields you from infamy.--Consumerist

6. Browser Beware

More details have emerged about a password-stealing encryption bug that was discovered on several websites yesterday. The bug, called Heartbleed, was found on Airbnb, Pinterest, and Creative Commons (to name a few), and though many of these companies have announced fixes, beware: lingering security issues still persist.--Mashable

7. The Programmers Are Coming

New York's tech workforce is booming--so say studies, at least--and two companies with announcements this morning are aiming to help companies find the programmers they desperately need. is launching in New York City to match developers and employers, and The Flatiron School, which educates Web developers and software engineers, is getting an infusion of cash to

Categories: Small Business News

Why You Should Worry About Heartbleed

Inc Small Business - Wed, 04/09/2014 - 8:12am

A new security threat exposes passwords and credit card numbers once thought secure and encrypted.

An alarming lapse in Internet security has exposed millions of passwords, credit card numbers and other sensitive bits of information to potential theft by computer hackers who may have been secretly exploiting the problem before its discovery.

The breakdown revealed this week affects the encryption technology that is supposed to protect online accounts for emails, instant messaging and a wide range of electronic commerce.

Security researchers who uncovered the threat, known as "Heartbleed," are particularly worried about the breach because it went undetected for more than two years.

Although there is now a way to close the security hole, there are still plenty of reasons to be concerned, said David Chartier, CEO of Codenomicon. A small team from the Finnish security firm diagnosed Heartbleed while working independently from another Google Inc. researcher who also discovered the threat.

"I don't think anyone that had been using this technology is in a position to definitively say they weren't compromised," Chartier said.

Chartier and other computer security experts are advising people to consider changing all their online passwords.

"I would change every password everywhere because it's possible something was sniffed out," said Wolfgang Kandek, chief technology officer for Qualys, a maker of security-analysis software. "You don't know because an attack wouldn't have left a distinct footprint."

But changing the passwords won't do any good, these experts said, until the affected services install the software released Monday to fix the problem. That puts the onus on the Internet services affected by Heartbleed to alert their users to the potential risks and let them know when the Heartbleed fix has been installed so they can change their passwords.

"This is going to be difficult for the average guy in the streets to understand, because it's hard to know who has done what and what is safe," Chartier said.

Yahoo Inc., which boasts more than 800 million users worldwide, is among the Internet services that could be potentially hurt by Heartbleed. The Sunnyvale, Calif., company said most of its most popular services--including sports, finance and Tumblr--had been fixed, but work was still being done on other products that it didn't identify in a statement Tuesday.

"We're focused on providing the most secure experience possible for our users worldwide and are continuously working to protect our users' data," Yahoo said.

Heartbleed creates an opening in SSL/TLS, an encryption technology marked by the small, closed padlock and "https:" on Web browsers to signify that traffic is secure. The flaw makes it possible to snoop on Internet traffic even if the padlock had been closed. Interlopers could also grab the keys for deciphering encrypted data without the website owners knowing the theft had occurred, according to security researchers.

The problem affects only the variant of SSL/TLS known as OpenSSL, but that happens to be one of the most common on the Internet.

About two-thirds of Web servers rely on OpenSSL, Chartier said. That means the information passing through hundreds of thousands of websites could be vulnerable, despite the protection offered by encryptions. Beside emails and chats, OpenSSL is also used to secure virtual private networks, which are used by employees to connect with corporate networks seeking to shield confidential information from prying eyes.

Heartbleed exposed a weakness in encryption at the same time that major Internet services such as Yahoo, Google, Microsoft and Facebook are expanding their usage of technology to reassure the users about the sanctity of their personal data. The additional security measures are being adopted in response to mounting concerns about the U.S. government's surveillance of online activities and other communications. The snooping has been revealed during the past 10 months through a series of leaked documents from former NSA contractor Edward Snowden.

Despite the worries raised by Heartbleed, Codenomicon said many large consumer sites aren't likely to be affected because of their "conservative choice" of equipment and software. "Ironically, smaller and more progressive services or those who have upgraded to (the) latest and best encryption will be affected most," the security firm said in a blog post.

Although it may take months for smaller websites to install the Heartbleed fix, Chartier predicted all the major Internet services will act quickly to protect their reputations.

In a Tuesday post announcing it had installed the Heartbleed fix, Tumblr offered its users some blunt advice.

"This still means that the little lock icon (HTTPS) we all trusted to keep our passwords, personal emails, and credit cards safe, was actually making all that private information accessible to anyone who knew about the exploit," Tumblr said. "This might be a good day to call in sick and take some time to change your passwords everywhere--especially your high-security services like email, file storage, and banking, which may have been compromised by this bug."

--Associated Press

Categories: Small Business News

Detecting Workplace Dishonesty: Should You Trust Your Gut?

Inc Small Business - Wed, 04/09/2014 - 7:39am

Some research is actionable, and some is just fascinating. A new study showing the human capacity for lie detection probably falls under the latter.

You might have a better chance of detecting workplace dishonesty if you aren't consciously trying to do so, new research from UC Berkeley suggests.

The study, as explained by the journal Psychological Science, tasked a group of students choose whether or not to take money from an empty room. The students were then brought to one of the experimenters, who questioned them as to whether or not they took the cash. Regardless of whether or not they did so, every student involved was instructed to deny knowing anything about the money.

Another group of students watched the questioning and were tasked with trying to determine whether or not they were lying. Those students were able to accurately judge who was lying and who was being honest at a worse rate than the flip of a coin--less than 50 percent of the time.

This sort of active lie-detecting experiment was then compared to the results of a more subconscious method. Students were far more successful at identifying liars when they took what's called an "Implicit Association Test," which had them match words like "honest" and "deceitful" with participants based just on their initial reaction to the subjects at hand. In other words, gut feeling made for a better lie detector than real questioning.

But let's not go crazy with this info.

The Implications

It's fascinating (and, of course, peer-reviewed) stuff that tells us a little bit about the human unconscious. But can you use it?

Research, provided it's legit, almost always serves as a way to further understand how stuff works. That doesn't always mean it's prescriptive, however.

Relying on your gut to seek out office dishonesty sounds like a recipe for disaster, with potential to incite lawsuits and paranoia run amock.

Not to mention, questions arise as to whether knowledge that your subconscious is good at detecting lies ultimately undermines your subconscious in the first place. Follow me here: If you're conscious of your subconscious, and plan to use it as a tool, is it really a subconscious after all? (In an email to Inc., study author Professor Leanne ten Brinke says that more research would be required to show whether or not there was an effect.)

The researchers, I should note, don't see a suggestion in the findings (though some news reports have). ten Brinke tells Inc., "These findings suggest few practical implications at present, but the research is very important in that it opens up a whole new set of possibilities for the detection of deception."

So what can you do with the info? Well, to some extent it serves to validate your spider sense. If you have a bad feeling about somebody, that might mean it's worth looking into it. Even so, how 'bout we all commit to not disciplining anybody based on a hunch alone? "More research is necessary before we know if and how we can access this unconscious insight in the 'real' world," says ten Brinke.

More than anything, though, the research might best serve as a reminder that we get so often and yet can always use again: The human brain is a tricky, tricky thing.

Categories: Small Business News

The Best Way to Build Company Value

Inc Small Business - Wed, 04/09/2014 - 7:12am

B2B CFO founder Jerry Mills explains the one focus you need to drive an increase in your company's value.

Categories: Small Business News

7 Ways to Have a Truly Great Morning

Inc Small Business - Wed, 04/09/2014 - 7:01am

You're at your peak both mentally and physically, and ready to seize the day. Take advantage of this time by adopting these simple practices.

You can maximize your productivity by taking full advantage of the first few hours of the workday. Jumpstarting your day the right way will not only get you started on the right foot but can help prevent those dreaded end-of-day crises from erupting. Leverage your morning hours as effectively as possible by following these seven simple steps.

1. Be on Time

While some executives and managers don't have a strict schedule for reporting to work each day, you will be much more effective if you consistently arrive at work on time or perhaps even a little early. Not only do you set a good example for the people who work for you, but those early hours tend to be quieter and more distraction-free.

2. Check In with Your People

A ten-minute meeting with your key people is a great way to start the day and to keep everyone motivated and on course. Discussing the daily plan of action at the beginning of the workday will give people a reason to be on time, and get them focused on their responsibilities. Try to incorporate a little bit of fun in your meetings, and remember that the best way to motivate people is by being positive instead of negative.

3. Tackle What's Most Important

Is there a call that you're dreading making? Then the morning is the time to make it. Tackle the important tasks on your to-do list first to clear your mind and to create the momentum that will carry you through the rest of your day. Save less-important tasks for later in the day, or delegate them to others, so you can keep your focus on what's most important.

4. Be Present

Do your best to remain present during all your interactions with employees, customers, vendors, and others. It's easy to get sidetracked thinking of the things that need to be accomplished, but giving employees your undivided attention during conversations and meetings ensures that you really hear what they say. Ignore the computer screen, put down your smart phone, and simply liste--even if only for 5 minutes. Giving your employees the attention and respect they deserve will encourage them to come to you with more and better ideas.

5. Catch Up on the News

Take a few minutes to catch up on what's happening in your industry, with your competitors, and in your community. You can do this at home while you're having breakfast, or upon arrival at the office. Increase your efficiency by setting up online news alerts that will send you articles on the topics that interest you most.

6. Plan a Mid-Morning Break

Whether it's a quick walk around the office, a cup of coffee in the break room, or a phone call outside, taking a quick break during the middle of your morning will give you a refreshed viewpoint on your current situation, which can lead to breakthrough thinking and new ideas. Encourage a coworker to join you during your break so you can work through issues or kick around ideas.

7. Create a "Not-to-Do" List

You know the distractions you should be avoiding, the ones that consistently suck time and energy out of your day? To avoid getting sidetracked make a list of them and keep it on your desk. Paired with your to-do list, you now have a double dose of focus and prioritization.

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Categories: Small Business News

The Many Benefits to Tracking Your Time

Inc Small Business - Wed, 04/09/2014 - 7:00am

When one startup started keeping track of how it spent its minutes, great things happened. Should you give it a try?

As a business owner, you no doubt already have far more administrative work than you would like. You can’t get rid of the bookkeeping and the bill paying, but why on earn would you add the additional burden of tracking your time if you’re not billing by the hour?

A long litany of productivity gurus (Laura Vanderkam recently quite prominent among them) have suggested that tracking your time will be a revelation, exposing just how much time you’re frittering away and offering a chance to reevaluate and better spend the hours you’re currently wasting. Most of these writers are focused on the big picture--one day, long in the future, it is hoped, when you’re reviewing your life, you’ll have fewer regrets--but at startup Grammarly, the case for time tracking is based more on cold, hard business.

"Whether or not a team member is billing by the hour, it is important to understand that time is one of the most valuable (and scarce) resources at any organization," CEO Brad Hoover told "Operating under the assumption that your time is worth money--whether to you or to your client--helps you to prioritize the finite number of hours in your day."

That not only helps you eliminate the office equivalent of mindlessly watching The Real Housewives of Wherever, but it also gives you the information you need to put your limited time and energy to the best use. After all, Hoover points out, "80 percent of a team member's most productive work gets done in 20 percent of that person's total time in the office. Time tracking enables all team members to focus on what matters most and to improve their output."

The Nuts and Bolts

Grammarly stumbled on the benefits of time tracking after testing tools to track consultants’ time, and it became a big fan of the practice. The company doesn’t require all employees to track their time, but it does strongly encourage it. Nor does the startup mandate any particular tool, though it has found one to be particularly useful.

"Some members of our team have found Toggl to be a useful tool," explains Hoover. "They can track work tasks versus personal tasks, specific projects, and any level of granularity in between. When they begin working on a particular project, they need only click Start to begin tracking in the manner that works best for them." Vanderkam, ever present in this space, has rounded up 10 time-tracking apps to try. Most likely, one of them will suit your needs.

The Results

Whatever method you choose to keep track of your minutes, the process is going to amount to some additional hassle for you, so the effort better be well rewarded. Was it at Grammarly? It’s not only the boss who claims the practice has been a real benefit for the business.

The startup’s SEO manager, Nikolas Baron, claims that tracking his time has had an immediate and significant impact on not only his productivity but also his focus. "Rather than answering a call, checking email, and then moving back and forth between several tasks that I have in progress," says Baron, "time tracking actually encourages me to focus on one activity for an extended period of time to improve my focus and productivity. Also, time tracking is a great way to remind me to get up and move around every 50 minutes to clear my head and refresh my perspective."

Do you track your time? Should you start?

Categories: Small Business News

How to Know You Have a Good Startup Idea: 5 Questions

Inc Small Business - Wed, 04/09/2014 - 6:41am

A design expert talks about the very first steps of his product design process.

You've thought up this hazy, partially-defined, intangible thing, that might or might not be a real product one day. So how do you know if you're onto something?

"Fundamentally, we are in that business of working alongside leaders to help them figure out what's worth pursuing from a design perspective," Matt Rolandson, a partner at the San Francisco-based design studio, Ammunition, said.

Rolandson -- who's worked with both small startups and large organizations like Apple, Skype and Square -- specializes in user experience design. He also works with business leaders on design strategy. In other words, he helps them to determine what to make and why it makes sense within the context of their business.

"Design really is a part of the long-term process of figuring out what to do in the first place, conceptualizing it, implementing it, optimizing it," Rolandson said. That's why he recommends that startups establish a leadership role for a designer from the outset.

But if you're not quite there yet -- and so far all you've got is yourself and your idea -- there are a few questions you can use to channel a designer's mind. This can either help you to crystallize your idea, or decide to toss it. Here are the questions that Rolandson starts with before he takes on any project, whether for an established company or fledgling one.

1. Of all of the things you could do, why this?

Entrepreneurs could be doing anything with their time, so they should have a clear answer as to why they've chosen to spend it one way. "It's important because I think it really gives the whole business, and ultimately the product and service, an emotional charge," Rolandson said.

If a leader one day decides to pursue design because he thinks it will improve the product and eventually yield a greater profit, that's a smart business decision, Rolandson said. "But it may not be providing the most interesting terrain for doing something that really feels amazing."

Though it might seem touchy-feely, define the true emotional reason for your business' existence. For many health care startups, their mission is born out of a need to help themselves or help a loved one. In the case of cookware company Williams Sonoma, which Ammunition has worked with, it's about inciting people to convene in the kitchen.

"That company's intentions really do come from this place of helping to bring people together around food," Rolandson said. "And that's a pretty motivating way to start working on something."

2. What isn't negotiable?

This question will help you to make some initial decisions about which design features are in and out. Another way to think about this question is: what features would you still care about, even if you knew you were going to get punished for caring about them?

"This can serve as a guidance system for making business decisions, but it's also really useful fodder for designing the product or designing the experience," Rolandson explained.

3. What does the world look like with your product in it?

Rolandson said he's never met a leader that doesn't want to address this question. However envisioning this future scene clearly is difficult because first you need to have a good idea of who you're trying to affect. And that's the next question.

4. Who are you trying to take care of?

What is their daily life like? What do they struggle with? What motivates them? What things make them feel good?

"Personifying and empathizing with all of the actors that are going to go into making this business come together is really critical," Rolandson said.

5. What does your company stand for?

This isn't an elevator pitch. This is a two-second definition of your company.

Got it? Now, go.

Categories: Small Business News

Content Marketing Strategies: What Really Works (and What Doesn't)

Inc Small Business - Wed, 04/09/2014 - 6:30am

A new study by Nielsen reveals the most effective content marketing formats and how each affects the various stages of the consumer buyer journey.

Many forward-thinking businesses have learned that being part of the buyer's journey--as an informational source--dramatically increases brand affinity. It also increases the likelihood that any purchase will go to their business, not that of the competition.

The idea of content marketing was born from this goal, and it has resulted in the development of various forms of content marketing. However, brand marketers are always working to understand which content marketing channels are best for maximizing returns.

So what is the most effective content marketing channel to increase brand affinity and product awareness and usher prospects through the buyer journey?

Content Types

These questions were addressed in a recent Nielsen study, which analyzed the effectiveness of these three major content types:

  • Branded Content--Owned content that exists on brand websites
  • Expert Content--Earned media that includes reviews and articles from relevant third-party websites and blogs
  • User Reviews--Content from the reviews portion of major online retailers or online forums

As part of the study, the following key measures were chosen to measure content effectiveness:

  • Stage 1: Familiarity with a new product
  • Stage 2: Affinity toward a brand or product
  • Stage 3: Purchase consideration of a brand or product

In general, the study revealed consumers have a higher degree of trust in content produced from credible, third-party experts. This consumer trust pays off, as expert content was, on average, the most effective content type for all three stages of the buyer journey.

According to the study, expert content assets "lifted familiarity 88 percent more than branded content and 50 percent more than user reviews." The study also revealed that expert content lifted affinity 50 percent more than branded content and 20 percent more than user reviews. When it came to purchase consideration, it lifted purchase consideration 38 percent more than branded content and 83 percent more than user reviews.

Branded content is best used for technology products that are ruled by product specs, such as cameras, automobiles, and smartphones.

User reviews were found to be most successful in categories in which users already have a high degree of product expertise. This applies to products such as video games, for which knowledgeable users are very active on online forums. Still, expert content was most effective in creating initial product awareness or familiarity.

Though each content type demonstrates effectiveness at increasing product familiarity, brand affinity, and purchase intent, content written by credible third-party resources performs the best overall. The business that invests in a content marketing strategy that takes this into account should definitely gain an edge in its industry.

Categories: Small Business News

10 Reasons Change Efforts Fail

Inc Small Business - Wed, 04/09/2014 - 6:15am

Looking to implement a change in your organization? Here are 10 common mistakes businesses make--and how you can avoid them.

Growth may be optional but change is inevitable. Unfortunately, most efforts to make organizational changes fail, and the reasons are predictable. Since change will happen in your business, keep these 10 reasons handy to boost your chances of a successful change effort--and business growth.

1. Asking for Behavior X while rewarding Behavior Y. Make sure you align your systems and work processes with desired behaviors. You get what you reinforce.

2. Over planning. Analysis paralysis = inaction. So, just get started, learn, tweak, improve, and repeat.

3. Going for the home run. Focus on hitting singles--small, quick wins to build momentum for larger, long-term victories.

4. Uninformed and disengaged team. Early and ongoing communication helps your team make more intelligent decisions and feel more ownership.

5. The devil is in the details. Don’t keep discussions at a conceptual, strategic level. Once you are clear on your plan, execution is about details.

6. Change is good, you go first. Be the leader, go first!

7. "People are our most valuable resource" is just a saying. Sustained change is always driven by people. Even implementing new software successfully is more about the people who will use is, install it, train it, and support it than it is about the system itself.

8. Lack of compelling reason to change. Even the best plan must be accompanied with a great story to support it. Your story should build a bridge between today’s challenges and a brighter tomorrow.

9. Energy and resources spent on the resistors of change. Support your supporters and let the others make a choice to follow. Don’t throw good money and energy after bad.

10. Throwing out the baby with the bath water. Changing everything rather than identifying those things that must change to meet new business objectives creates unnecessary havoc. Identify what you should start, stop, and keep, and then plan your changes accordingly.

Find strategies to stick with it in the author's latest book, Stick with It: Mastering the Art of Adherence. Download free book chapters here.

Categories: Small Business News

What 3 Traits Should Your Perfect Hire Have?

Inc Small Business - Wed, 04/09/2014 - 6:00am

With college grads flooding the market, do yourself a favor and nail down what you want in a candidate now. Here are three ideas.

In the five years since we started The Grommet, my co-founder and I have interviewed every finalist for a permanent position. With a team of over 50, that is still a feasible and necessary step to preserving the quality of our team and our culture. Perhaps when we get to 500 people that will no longer be possible, but for now I am able to share what I know will set the person up for a great interview--and a great future employee.

These are the three character traits I look for when I am interviewing entry and early-career people.


I expect at a bare minimum for a candidate to be able to articulate their interest in our company in a truly personal way. I am not looking for them to memorize our mission. In fact I prefer that they use their own words to describe an attachment to what we do. (In addition, it can be highly enlightening to me, as CEO, to find people characterizing our business in original ways. I learn what is "landing" from our communications efforts, and what is not.) If an applicant can't describe our business with genuine insight, I know they are just looking for a job--any job--and they will not fit into our team of highly committed people.

And at the very least, a candidate needs to understand the core product of a company. One otherwise qualified applicant blew her interview when she failed to answer my easiest softball question: "What is your favorite Grommet or Grommet video?" (There are hundreds on our site.) I was so annoyed I actually emailed the person who referred her to advise this trusted senior person not to lend her reputation to this young woman again before giving her more coaching on basic preparation.


Our VP of marketing, Sandrine Mangia-Park, told me recently, "I've interviewed a lot of people and they sometimes don’t realize that it will take me five minutes to get my head in the game. I might have just come from a demanding meeting, another interview, or received bad news. They should not throw their best stuff at me immediately." A job candidate should start with the assumption that the beginning of the meeting is just an effort to connect on a human level;you don't have to dazzle the interviewer with your qualifications just yet. In fact, please don't.

There are multiple ways to reel me in as CEO. You can talk about your reaction to a particular Grommet we launched (see above!), or share an insight about a shared professional connection (LinkedIn makes this a piece of cake). Some people tell me a funny story. That takes confidence and if you have a great sense of humor, use it. One middle-aged white woman answered my (always terrifying) "tell me about yourself" question with Steve Martin's classic "I grew up a poor black boy." That totally disarmed me. She got the job. The easiest thing of all is to ask a question about my vision for the company, or about a blog post or article I wrote. It is a sure bet way to a CEO's heart.

My immediate reaction from any of the above interactions is "I've got a live wire in front of me. This meeting is going to be worth my time."


We hire a lot of entry and early-career people. I have limited expectations for their subject matter knowledge. We expect to train them ourselves. With more experienced people I am going to drill down on their prior responsibilities and expertise. But no matter what the level of candidate, I am most avidly interested in their ability to describe the why behind their choices. For instance, "Why did you choose that college?" (And it is OK to say it was the one you could afford.) "Why did you leave that position?;" "Why did you move to that city?"

In listening to a candidate's descriptions of their decisions and transitions I am looking for evidence of original thinking, self-awareness, and a positive attitude. I want to hear that a person was always headed towards a deliberate, thoughtful choice, and not following convention or simply escaping a negative situation. It's not that I don't respect leaving a bad job--I do. Sometimes leaving is the best choice of all. It's more that I want the person to be able to own their decisions, be thoughtful in transitions, and I am also guarding for people who don't have the tenacity to stick with something if the going gets tough.

I find a lot of candidates overinvest time in describing the specifics of their current or prior jobs, when what I really am looking for is their ability to attach meaning to their decisions, including the one to possibly work at my company. In preparing well, making a human connection with me, and showing thoughtful decision-making, an applicant can powerfully separate himself or herself from the pack.

Categories: Small Business News

12 Habits of Really Successful People (Mad Men Edition)

Inc Small Business - Wed, 04/09/2014 - 5:53am

The world has changed radically, but some of the habits that led to success in the 1960s have timeless application.

Years go by, fashion changes, but the things that really successful people do each day are timeless.

Here's a case in point: Mad Men, the hit television show about the partners and employees in a 1960s advertising agency, now entering its seventh season. I've written before about how the real star of the program isn't Don Draper or Peggy Olson but the advertising agency itself. More than that, if you take notes, you'll see that the plot lines and characters offer great examples of how to get ahead every single day--and how not to.

1. Trust your creative side.

Series protagonist Draper's title is "creative director," which has to be one of the most apt job descriptions ever, given his penchant for reinvention. However, he does seem to understand how his creative mind works. Among his practices, he'll spend a lot of time thinking about a creative challenge, then forget it, allowing his subconscious mind to do the heavy lifting.

2. Fake it until you make it.

Draper is secretly living another man's life, and with the development of another character, Bob Benson, it looks as though he's not the only one. When the firm was small, it would go out of its way to try to look bigger and more accomplished. You don't want to be dishonest or disingenuous, but you do want to visualize what success would look like and behave as if you already fit the part.

3. Get ahead of your customers.

Here's the key to advertising. Dealing with people effectively is about finding a way to help them get what they want. The challenge is that so few people are truly self-aware. Thus, your mission is to figure it out for them and find a solution to a problem they didn't even know about.

4. Think bigger.

Olson rose from secretary to creative director. Joan Holloway is now a partner bringing in new accounts. Both characters have reached higher levels than they originally dreamed of, only to find that the prize for climbing a mountain is often another bigger mountain. Plans change, goals shift, but it's the people who are willing to dream bigger who actually accomplish things.

5. Plan ahead.

Mad Men opened years ago with its characters facing a professional challenge. The U.S. government was about to start cracking down on cigarette advertisers, and the firm needed to find both a new way to pitch its tobacco clients and a new direction to find more clients. This required long-term thinking that didn't exactly come naturally to all of the characters.

6. Don't be afraid to quit.

The show is about beginnings and endings, over and over and over--fired clients; fired employees; marriages, business deals, and client engagements that the characters walk away from because they're not working out. From the destruction each time comes a new opportunity.

7. Have fun.

The show is known for its unflinching look at a kind of 1960s debauchery, with all kinds of drinking, sleeping around, and drug experimentation. It's a really unhealthy way to live your life, but it also seems to be the way that the characters blow off steam--and they've got a lot of steam. Don't become an alcoholic philanderer, but be sure to have fun (in healthier ways, I hope).

8. Get a life.

This is where so many of the characters on the show fall down, because they have success only at work, and rush from one failed relationship to another. They seek to solve others' problems only when there is something tangible in it for them: a new client, more money, something they want. Don't follow their example. Remember the old adage that on their deathbeds, people rarely say they wish they had spent more time at the office.

9. Leverage technology.

In the early years of Mad Men, the new technology was television, which was quickly becoming the most effective medium of its time to communicate marketing messages. Part of the protagonists' success involved their ability to pivot and take advantage of it. The technology has changed--boy, has it ever--but the lesson is the same. You can either be an early adapter or an also-ran.

10. Enjoy the roller coaster.

If you're going to be successful--whether in building a business or elsewhere--you're going to have a lot of ups and downs. It makes for great drama on television and for some stomach-churning in real life. If you can't enjoy that kind of volatility, then find a safer, more secure path. You'll be happier and so will those around you. Every day, remind yourself that whether today was an up day or a down one, there will be many others to balance it out.

11. Care for and feed your network.

Half of the characters' jobs on Mad Men are simply to manage relationships with the firm's clients and to network and schmooze with potential new clients. Heck, Draper first got hired after meeting Roger Sterling, getting him drunk, and showing up the next day claiming he had been offered a job. Sterling had been too drunk to remember doing it. These are some morally questionable choices, but that doesn't mean you can't learn from them. Every day, reach out to at least one new person, and to someone you've been out of touch with for a while.

12. Go where the action is.

In real life, Jimmy Fallon recently moved The Tonight Show back to New York City, but in the world of Mad Men, Johnny Carson is about to head to Los Angeles. One of the themes for the new season is the idea of new beginnings, especially out West. Today's new frontiers are more global but no less real. (As someone who has recently expanded the client base of my ghostwriting business to Asia and the Middle East, I have seen this firsthand.)

Want to read more, make suggestions, or even be featured in a future column? Contact me and sign up for my weekly email.

Categories: Small Business News

What a Marshmallow Reveals About Collaboration

Inc Small Business - Wed, 04/09/2014 - 5:30am

A simple design exercise can teach you about incentives, B-school graduates, and the high value of an administrative assistant.

You won’t believe it till you watch it. But there’s this video on called "Build a tower, build a team," and it’s not nearly as gimmicky as it sounds.

The men behind it are Peter Skillman and Tom Wujec. Skillman, former VP of design at Palm, is now a VP of design at Nokia. Wujec is a Fellow at Autodesk, the legendary makers of AutoCAD design software. He’s also the author of Five Star Mind: Games and Puzzles to Stimulate Your Creativity and Imagination.

In the video, Wujec explains a concept Skillman introduced to the folks at TED: constructing “a marshmallow tower” as a team-building exercise. Here’s how it works: Teams of four have 18 minutes to create the tallest possible freestanding structure using four components: 20 sticks of spaghetti, one yard of tape, one yard of string, and one marshmallow. And the marshmallow has to be on the top.

“There’s something about this exercise that reveals very deep lessons about the nature of collaboration,” says Wujec in the video. Having performed the exercise with more than 70 groups--including groups at Fortune 50 companies--Wujec has reached a few conclusions:

1. Recent business school graduates perform poorly. “They lie, they would cheat, they get distracted, and they produce really lame structures,” he says. The average tower by all participants in the exercise is 20 inches; the average tower by B-school grads is only 10 inches.

2. Recent graduates of kindergarten perform well. The average tower by kindergarten graduates measures 26 inches. “Not only do they produce the tallest structures but the most interesting structures of them all,” he reports. Why is that? “[Skillman] likes to say that none of the kids spends any time trying to be CEO of Spaghetti, Inc.,” says Wujec. In an exercise with an 18-minute limit, such jockeying for positions is wasted time.

B-school graduates tend to wait until the end of the 18 minutes to add the marshmallow to the top of their structures. When the structures collapse, the B-school teams enter something like a crisis mode. The kindergarten grads, by contrast, tend to incorporate the marshmallow into their designs early on, averting last-second crises.

Other fascinating results: CEO quartets design towers that measure 21 inches on average. But when you add an executive administrator to the CEO teams, their towers shoot up to an average of 30 inches. “[The executive administrators] have special skills of facilitation,” says Wujec. “They manage the process.”

Perhaps the most dramatic result came on a day when Wujec--performing the experiment with teams of design students--decided to offer a $10,000 prize to the group building the tallest structure. Despite the hefty incentive, not one of the 10 teams participating was able to produce a standing structure. “If anyone had built even a one-inch structure, they would’ve taken the prize,” he says.

Four months later, he performed the exercise with the same students, again offering the incentive. This time, nine of the teams produced freestanding structures, six of which exceeded the 20-inch average. The lessons: Practice makes perfect, and incentives can inhibit performance if they bring nerves into the equation.

This article was originally published at The Build Network.

Categories: Small Business News

Overextended? Here are 5 Polite Ways to Say No

Inc Small Business - Wed, 04/09/2014 - 5:30am

Why stepping away from all of the external asks is important to your sanity and your business.

It is getting harder and harder to avoid living a life of over commitment. Every email requires a response, every phone call ends up with more things to do, running a business is more complicated with responsibilities on a daily basis, we are required to attend more meetings, and our "to do" list just keeps getting longer.

One of the skills that most of us have to get better at is learning to master our commitments, and I like to think of this as mastering the art of deflection. Now this isn’t saying we will get out of our commitments, rather we will get better at prioritizing them, finding time to meet them, and developing new skills to put us back in the driving seat when it comes to deciding if we want to take a commitment or not.

Here are five strategies that I use on regular basis to overcome being over-committed:

1. When someone asks for your time, say you have to check your calendar.

Many people struggle to say no to a request for their time, simply because they feel that they are put on the spot when the request is made. Whenever someone asks me to do something, I always say that I have to check my diary and other commitments before I can confirm. This buys me time to decide if I want to commit to this particular request, if I have the time, how I would like it to work and so on. I never feel pressured to commit to anything now and I make much better decisions as result of having some room to think.

2. Always ask for more information.

Whenever someone is asking for advice or help in some way, I ask them to send through more information or more specific details and to explain exactly what they would like me to do and when they would like it done by? Once I receive this information I will make a decision. At least half the time I never hear from them again, which shows how committed they were. In other words I won’t commit time or energy until they do the same.

3. Charge for your time.

As an author and presenter, I have a lot of people contacting me for free advice. Sometimes it can be as many as three hundred emails a week. These are generally in the form of questions about specific aspects of doing business. In the past I tried to answer every one, but it soon became apparent that I would go broke if I spent all of my time answering people’s questions for free. So I introduced a “One on One Package”. This is a $500 product where people can send me their questions and I would offer a Skype consultation and some of my books. I explain very nicely that I run a business that offers advice commercially and interestingly, about one in ten people buy the package. The rest I never hear from again.

4. Tell a white lie.

I figured this one out many years ago. The day before leaving for a business trip was always incredibly stressful and over committed on every front. I started to tell a white lie about when I was leaving. Specifically I would say I was going a day earlier than I actually was. This gave me a full day in the office (or at home) to get everything done that I needed to do without the last minute panic of clients, suppliers and staff, needing my time. I still do this today, and I leave for every trip feeling relaxed and refreshed instead of stressed out and exhausted.

5. Get creative at saying, "Sorry, no can do."

Often the hardest part about being asked to commit to something is how to say no without feeling rude. Several years ago I found that my not for profit pro bono work was getting out of hand. I was spending up to two full days a week doing free work for a handful of charities and it became apparent that if something didn’t change I would soon need the services provided by these organisations. I found saying no to any request for help very hard. So rather than saying no, I reframed how I could help the various charities. I decided to commit a maximum of 8 hours per week and once this was used, that was it. When I received a request for help, I would advise them of how I worked and they could book time in advance, but once I had reached 8 hours for any particular week I was fully committed and that was that. In essence this created a procedure that I could hide behind to help me say no without feeling guilty.

In the crazy fast paced world we live in, it is easy to commit ever minute of every day. Then if one thing goes wrong, everything goes wrong. The compound effect is extremely stressful. In addition to saying "no" we need to find time in our day to play catch up. I suggest scheduling a one-hour time slot every morning and every afternoon to manage the unexpected. I also schedule at least one day a month to do nothing but work through my pile of incompletes and I have to say it is very therapeutic.

The better we become at managing commitment, the more effective we will be every aspect of our life.

Categories: Small Business News

10 Things Employees Really Need to Hear From You

Inc Small Business - Wed, 04/09/2014 - 5:15am

A former CEO provides the exact words you need to say when employees need a morale boost.

I usually don't get very excited about business books, but I recently ran across one that's really powerful: Finding Happiness: One Man's Quest to Beat Depression and Anxiety and--Finally--Let the Sunshine In, by former CEO Todd Patkin.

Patkin has identified 14 phrases that really improve morale when they come from the boss. Here are the 10 that impressed me the most:

1. "I need your help."

You aren't Superman (or Wonder Woman) and your employees know it, so don't pretend to know all the answers or pretend that you can get along fine without your employees and their skills.

Rather than losing respect for you as a leader, they'll appreciate that you treated them as valued partners--and they'll feel more invested in your company's future because they had more of a hand in creating it.

2. "What do you need from me?"

Often, employees are anxious about asking the boss for what they need, because they may fear a harsh response, they want to avoid looking needy, or they simply feel that it's not their place to ask for more than you've already provided.

By explicitly asking what you can give them, you extend permission for your people to make those requests--and they'll certainly appreciate it. If you can't give an employee what she asks for, explain why and work with her to find another solution.

3. "I noticed what you did."

Every day, your employees do a lot of "little" things that keep your company running smoothly and customers coming back, including refilling the copier and double-checking reports for errors before sending them on.

Employees want to know that you notice and value the mundane parts of their jobs, not just the big wins and achievements. Make it your mission to catch as many of your employees as possible doing stuff right.

4. "Thank you."

Whether you say, "Thanks for staying late last night," "Thanks for being so patient with Mrs. Smith--I know she can be a difficult customer," or something else, your people treasure your appreciation more than you realize.

People love to hear positive feedback about themselves, and in most cases, they'll be willing to work a lot harder to keep the compliments and thanks coming. Praise, especially when it comes from an authority figure, is incredibly fulfilling.

5. "Hey, everyone--listen to what Joe accomplished!"

Everybody loves to be recognized and complimented in front of their peers. So don't stop with a compliment when an employee experiences a win--tell the rest of the team, too!

Whether correctly or incorrectly, many employees feel that their leaders point out only their mistakes in front of the group, so make it your daily mission to prove that perception wrong.

6. "What would you like to do here?"

Sure, you originally hired each of your employees to do specific jobs. But over time, your company has grown and changed--and so have your people. Therefore, it's a good idea to check in with each one of them periodically to ask what everyone would like to be doing.

No, you won't always be able to accommodate an employee's preferences. But keep job descriptions within your company fluid, and allow your people to have a say in matching their skills to the company's needs.

7. "I have bad news."

Your instinct might be to play down negative developments, or even keep them to yourself entirely. However, your employees deserve to hear the truth from you as soon as possible.

Employees aren't stupid and will be able to tell when something is up even if you don't acknowledge it. By refusing to share bad news, you'll only increase paranoia and anxiousness--neither of which is productive.

8. "What do you think?"

Employees who are simply told what to do feel like numbers or cogs in a machine, and as a result their performance becomes grudging and uninspired. By contrast, you make your employees feel like valued partners by asking for their opinions, ideas, and preferences.

They'll be much more invested in your organization's success because they had an active part in creating it. And guess what? Your employees probably won't care as much as you think if their suggestions don't become reality. Mostly, they just want to be heard.

9. "That's OK. We all make mistakes."

Lambasting employees who dropped the ball may make you feel better, but it will damage their self-confidence, their relationship with you, and their feelings for your company.

Take a deep breath and remind yourself that the employee feels very bad already, and that yelling or lecturing won't change the past. Instead, focus on figuring out what went wrong and how to keep it from happening again.

10. "I know you can do it."

Of course, you should try to hire employees who are confident and self-directed. But even the most self-assured individuals appreciate an explicit vote of confidence from their leaders!

Constantly challenge your people, and push them to improve while reassuring them that you believe in them. Everyone, no matter how capable or experienced the person is, appreciates encouragement.

Bravo, Todd! And thanks for sharing!

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Categories: Small Business News

NYC Startups Need Engineers. This Company Aims to Deliver Them

Inc Small Business - Wed, 04/09/2014 - 5:00am

Another company launches in Manhattan solely to facilitate the hiring of programmers.

According to research from, there are more than 5,000 unfilled tech jobs--iOS developers, front-end programmers, and assorted roles in data-processing and programming--in New York City. Wednesday, the company is officially launching in Manhattan to help fill those needs. is a marketplace for tech talent that lets individuals looking for work put themselves up for auction to companies looking for their skills.

The company--formerly called DeveloperAuction, before rebranding last fall--is less than two years old, but has paired 250 skilled workers with new jobs. Hires through the site are now happening at the pace of more than one per day, on average.

Four employees from Hired have been operating in New York City, out of the SoHo co-working space WeWork, for about three months now. A bigger Hired presence in the city, however, could be good news for startups who've struggled to fill key technical roles. Andre Charoo, the head of new markets at Hired, who launched the New York presence for the company says he's found New York has the largest pool of open jobs in tech fields in the country.

That fact presents a few challenges for Hired, which has been operating in San Francisco since 2012, and pairing engineers with jobs at mostly fast-growth startups. But in New York, media companies, finance, and fashion are the anchor industries.

"Adding New York allows us to add non-technical companies that need [as many] if not more engineers. We're seeing finance-industry players like CitiBank and JPMorgan signing up," Charoo says. "We can put them on an equal playing field as Facebook."

New York's startup scene is represented on the site, though, too: In the roster of the roughly 100 companies that have already signed up are Betaworks, Etsy, Refinery29, Spotify, and Quirky. And more than 600 engineers are lined up to participate in auctions.

Why couldn't simply scale globally from its San Francisco office?

"Part of our strategy is not just global growth, but to have a grassroots presence," says co-founder Douglas Feirstein (pictured above at right). "Hiring is definitely a regionalized type of business, and it's important to be on the ground and do events."

The company in March raised a $15 million venture-funding infusion from Crosslink Capital, Sierra Ventures, SoftTech VC, and Sherpa Ventures. The investment gives the company a boost to expand to not just New York, but also to Los Angeles (expect an office to launch this summer), and to Seattle, before the end of 2014.

While offline recruitment is something still done frequently at a small scale, competition is vast in the online job-site space, with a broad range of social networks, such as LinkedIn, joining an existing ecosystem of job boards, such as,, and But zoom into the niche of only applicants with technical skill sets, and there's even competition there: Inc. reported last year on a talent agency that's pivoted to represent almost exclusively computer programmers.

Hired's New York team is looking for a new office to expand its presence, and accommodate up to 15 employees by the end of 2014. The current cramped coworking space may be getting too small, but it did have its advantages.

"What's cool about working out of a coworking space, is that it allows us to service all the companies there," says Charoo. "They all need engineers."

A recent study found that of 291,000 jobs in the New York City tech economy, more than half are in non-technical industries.

Categories: Small Business News

A $5.5 Million Bet on a Better Way to Learn Coding

Inc Small Business - Wed, 04/09/2014 - 4:30am

The Flatiron School isn't a college. It just received venture backing, but isn't growing super-fast. And it isn't even in the Flatiron neighborhood. It has a ton going for it anyway.

Sitting up as straight as is possible in an overstuffed couch in a room overlooking the iconic bronze Charging Bull sculpture in Lower Manhattan, a symbol of market volatility, Avi Flombaum proposes an idea some might find brash: "I don't think the best way to get an education in a technical vocation is to spend $200,000 and four years of your life."

He's not just in the oft-ridiculed Peter Thiel camp of libertarianism that advocates young people forego college in order to seek life experiences. Rather, Flombaum, a Web developer and writer, is an advocate of "cheating the system." He's created a fresh take on a trade school, called The Flatiron School, in Lower Manhattan, in order to test his theory.

New Path to Programming

His formula for a high-school graduate to find a fulfilling, well-paying career in today's economy without first spiraling into debt involves pursuing vocational skills, rather than a traditional education. It's with this goal in mind that he founded The Flatiron School alongside Adam Enbar, a graduate of Harvard Business School, who two years set out to rethink traditional higher education. (The pair connected on Twitter before meeting in coffeeshops, where they drew up both course plans and business plans.)

It's an interesting model for rapidly educating software engineers, particularly considering that a recent study about the New York tech industry found that half of New York City's technical work force doesn't have a traditional college education. The Flatiron School isn't a long-tested model. It's only less than two years old and has graduated just 125 students from individual courses, which are usually 12 weeks long and cost a maximum of $12,000. But the school Wednesday got a hint of validation to the tune of $5.5 million in investment in a round led by Cambridge-based venture-capital firm Charles River Ventures and New York City-based Matrix Partners.

Also consider that early statistics out of the school appear outstanding. According to the founders, Flombaum, 30, and Enbar, 31, its first programming class--19 students--saw 100 percent job placement. That number, five classes later, still is hovering very close to 100 percent--and graduates who had an existing salary (you know, not starting at zero) before the course, saw a 48 percent increase in salary by three months after taking it. Graduates have found jobs at established companies, such as Boeing and The New York Times, and startups in New York City, such as Artsy and Venmo.

Changing Careers

Stephanie Oh fought for a few years in her early 20s to break into the music industry in New York City, but last year grew disenchanted with her stagnant career in administration of music-talent management firm. She started applying to work at music startups, but found few administrative gigs--and a lot of openings for programmers.

"I thought, the only way I'm going to rise above this is if I learned the hard skills," Oh said. "I saw so many job openings for engineers, so the natural thought was, 'how do I become one of those?'" She applied to The Flatiron School, and attended from September through December of last year learning web development at The Flatiron School. She's reinvented her career, and now is a front-end developer and project manager at Splash, a New York City startup that creates events websites.

"This is the creative outlet that I thought I'd get in music," she said. "It's fast-paced, and there's problem solving, and in front-end development there's a lot of aesthetics to consider."

The courses at Flatiron (which is actually located in the New York's Financial District, after growing out of its small original space on East 26th Street) are designed to teach a full range of technical and creative-thinking skills in either iOS app development, or the programming language Ruby on Rails. The Flatiron School also offers a Web-development fellowship, with a similar education funded entirely by New York City's Department of Small Business Services.

What's perhaps most compelling about The Flatiron School model is not just its potential as a pipeline of in-demand tech talent into Silicon Alley. It also has a nuanced understanding of the actual act of teaching--and great ambitions to master the pedagogy of technology--and do so before expanding its course offerings or moving into new cities.

"We just want to obsess over how we can teach better," Flombaum told me. When Flombaum teaches computer-science courses, he uses storytelling skills acquired while studying creative writing, and incorporates history into his lessons, including highlighting the programmer who created the concept at hand.

It's tempting in this time of MOOCs to think education should be free, online, and flexible. Ed-tech is a promising industry, within the $1 trillion American education industry, with ed-tech startups attracting $1.25 billion in funding in 2013, according to CB Insights. But statistics show online education is far from a perfect solution to decreasing unemployment, increasing graduation rates. Flombaum and Enbar are dedicated to the idea that a classroom is a place for learning, growth, and collaboration (though the school does ask students to complete up to 150 hours of pre-course work before attending 9 a.m. to 6 p.m. weekdays for 12 weeks).

One of The Flatiron School's investors, Antonio Rodriguez, a general partner at the venture-capital firm Matrix Partners, said "a lot of hammers looking for nails in this space." He said in contrast to "flavor-of-the-month" technology solutions in education, The Flatiron School is "bringing technology to service that relationship and not reinvent it in a way that is both compelling and effective for students, teachers, and employers."

A Promising Pipeline

There's plenty of competition in teaching coding at a quick clip. Would-be developers can find course on Skillshare and at General Assembly, or start out in a DIY-fashion online at or Udacity offers online classes, and DevBootcamp is a popular intensive in-person program in San Francisco.

New York City--which, through the Bloomberg years put outsized emphasis on boosting the startup ecosystem, and finding solutions to a dearth of programmers--has been quick to show support for The Flatiron School. In addition to funding the Brooklyn-based NYC Web Development Fellowship, the city gave Flatiron $250,000 to help it move downtown to the Financial District.

The new venture-capital funding doesn't come with the typical "scale this fast" strings attached. Flombaum and Enbar, who self-funded the operation up to this point and who say tuition alone can keep the school easily afloat, say they want to work first on perfecting the methods their more than a dozen instructors employ before expanding to other cities or to online courses.

"We want to have a small, massive impact," Flombaum says, contrasting the approach of attempting to change the lives--and career paths--of a small number of students at a time to that of online education, which can reach a lot of people, but is likely to have just a small affect on each one.

"We raised money so we can slow down," Enbar says. "We want to create a Ivy League-quality vocational school."

Categories: Small Business News
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