Even though from the outside the music industry seems like a wounded giant, it is proving to be fertile ground for entrepreneurs willing to think about new and creative ways of getting music from artists to listeners.
The latest of these new ideas just got venture capital funding, as reported by Red Herring.
“Mercora, of Santa Clara, California received million in Series A funding Monday from Silicon Valley’s Norwest Venture Partners, to finance its Internet radio network. Mercora IM (Individual Modulation) Radio, which uses streaming audio, lets users listen to music from other users’ computers.
“Just like any other peer-to-peer file-swapping service, Mercora allows users to search music by artist or song title. But unlike Kazaa or Morpheus, which have been hobbled by the wrath of the Recording Industry Association of America (RIAA) and several legal challenges, Mercora doesn’t allow users to download songs onto their computers.
“‘It is a network of radio stations that is basically converting your PC into a webcasting station in compliance with copyright laws,’ said Srivats Sampath, co-founder and CEO. With Mercora, every user becomes a broadcaster and their playlist becomes a channel, he said.”
Not only is Mercora rethinking music distribution, but they are even rethinking broadcast radio. This may not be the answer for this industry, but it is definitely the kind of innovation that may help reinvent how music gets from performers to their fans.

Small Business Trends offers a few more interesting trends to consider this time related to health and family.
“Food and pets figure in greatly in the top 10 trends for family and health in the United States, as predicted by Better Homes and Gardens magazine. If you are a small business owner, consultant, solo entrepreneur, author, home-based business or franchise owner, you may just find a promising new business opportunity among these trends — not to mention improving your health and well-being.”
Anita also has links to all of the 2005 trends she has written about this year in this post. Several great posts in this list as well.

A question sent to me via e-mail from I.E.:
Most successful businesses, are not based around a revolutionary product or service. Many entrepreneurs that I’ve read about, simply enter a field where a number of competitors are already doing well, but the market demand is growing, and a segment of the market is partially underserved. Can you suggest any way to identify such opportunities? This seems especially hard because most competitors are private, so there is no way to know the level of demand in a particular market.
Someone I know is always trying to figure out the next great product to sell on QVC. But try and try as she may, she probably will never succeed with this strategy. Why? She has never had any experience with developing, manufacturing or selling consumer products.
Most successful entrepreneurs don’t simply “enter a market.” They build off of their experience, their knowledge, their education, and their skills. Successful entrepreneurs find some need in the market that is not being met that they have the knowledge, skills, and experience to satisfy for their customers. Maybe it is an area they gained expertise in from their education, maybe they’ve worked in the industry, or sometimes it can even come from a hobby or special interest. But even with a strong base of knowledge, more learning and more research is almost always needed.
Also, it takes people beyond the entrepreneur him/herself to successfully start and build a business. For example, my last entrepreneurial phase in life was in the health care industry. We had identified a niche in the market what was fairly new, was not being exploited by any other companies, and showed potential for significant growth. My partners had extensive experience in the health care, which I lacked. But, they needed me as a third partner to bring knowledge and skills on how to build and grow a business. Between the three of us, we had what it took to build a successful health care business. Any one of us trying to pursue this opportunity alone most likely would have failed.
Success requires first the ability to identify an opportunity for which there is a market. This usually takes some knowledge of that industry. Second, you must be certain that it can generate adequate profits to meet the cash needs of the business and the entrepreneurs. Finally, you (or more likely your team) must have the ability to successfully implement the plan and manage the business as it grows. Having the skills to manage the business as it grows is critical. However, many entrepreneurs are able to learn new business skills as they grow their businesses, and they can add new team members to fill any gaps in key business skills that arise over time.
Success does not simply come from a “good idea.” It comes from some basic knowledge about the product or service, good information about the market, and having the right business skills represented in the members of your team.

Inc.com has an amazing story told by a young entrepreneur, Bo Peabody, who started a business during the dot.com craze, sold it for $58 million in stock to Lycos at a point where he still had generated almost no revenue, saw Lycos stock go up tenfold, and then sold it all before the dot.bomb crash. Smart? Maybe a little. Lucky? You bet! Here are Mr. Peabody’s reflections on his own success.
“Luck is a part of life, and everyone, at one point or another, gets lucky. Luck is also a big part of business life and perhaps the biggest part of entrepreneurial life. At the very least, entrepreneurs must believe in luck. Ideally, they can recognize it when they see it. And over time, the best entrepreneurs can actually learn to create luck.
“Luck in business is different from regular old luck, like when you find $20 on the sidewalk. First of all, being lucky in business has an intoxicating underbelly called believing you’re smart. No one actually believes that he should take credit for finding $20 on the sidewalk. But when people get lucky in business, they are often convinced that it is not luck at all that brought them good fortune. They believe instead that their business venture succeeded thanks to their own blinding brilliance.”
It is good to be smart. It is even better to be lucky. But, it is critical to know the difference. I have seen too many entrepreneurs confuse luck with brilliance only to come crashing down to earth when their luck runs out.
Thanks to Peyman Motlagh, one of my former graduate students, for passing this story along.