Some of you will remember this song:
But the thrill we’ve never known
Is the thrill that’ll get you when you get your picture
On the cover of the Rolling Stone.
That was kind of how we felt around the Belmont University Center for Entrepreneurship this week. The Wall Street Journal ran a story on the growth in entrepreneurship education around the country, and the story included a couple of quotes about our program. If you go to the video, the opening scenes are of our program.
This past weekend I started writing a regular column for our local newspaper, the Tennessean. My first column was on moving beyound planning and finding the courage to actually launch a business. Here is a link to that column.
My column is part of a major revamping of the business section for the Tennessean. It will run every other Sunday.
For those of you who are interested in exploring the integration of your faith into your business I have a recommendation of an excellent book. Devotional Ventures, edited by Corey Cleek, is an inspiring read. It includes 60 entries by business people of all walks, including — to my surprise — my good friend Barry Landis.
MIT’s Technology Review offered its Top 10 Emerging Technologies Trends for 2007 in an article from last week. This year’s emerging trends includes:
– optical antennas — a basic technology with potentially broad applications
– metamaterials — another basic technology with potentially broad applications
– peer-to-peer video — help save us from a bogged down Internet from the growth in video on the web
– personalized medical monitors — can help to “simplify and improve medical diagnoses”
– compressive sensing — “revamp digital imaging systems in cameras and medical scanners”
– nanohealing — nanotechnology application for medicine
– quantum-dot solar power — nanotechnology application for solar power
– neuron control — might “help physicians fine-tune treatments for brain disorders such as depression and Parkinson’s disease”
– single-cell analysis — could “lead directly to predictive tests that could help doctors treat cancers more effectively”
– mobile augmented reality — combines “location sensors and advanced visual algorithms with cell phones…to help us figure our where we are”
(From the National Dialogue on Entrepreneurship).
BusinessWeek Online has a story that profiles 18 women who have left high-power corporate jobs to join the ranks of start-up entrepreneurs. The reason — “Only 2 of the 18 women on our list mentioned making more money as their primary motivation.”
Building a different kind of organizational culture seemed to be a major driving force for many of these women. While still striving for high performance, these new entrepreneurs want to create a more collaborative and team-driven culture. It appears that they also want to create cultures that are more supportive of employees.
Cecelia McCloy, the 52-year-old co-founder of Integrated Science Solutions, a Walnut Creek (Calif.) science and engineering firm with $9 million in sales, says she specifically set out to create a company that was friendly to families. Her employees also get eight hours of paid time off per year to participate in civic or charitable activities — say, to volunteer in their children’s classroom. Last year, about 20 of her 75 employees took advantage of the option. And every month, she asks managers to give her information on employees who did something exceptional for customers or their colleagues. McCloy then writes a thank-you note to those folks.
From our own research for our new book, we have found that these types of goals are also shared by many male entrepreneurs. It is heartening to see entrepreneurs of both genders pursuing such rich and well-ordered definitions of success in their businesses.
(Thanks to Ben Cunningham for passing this along).
In his classic book, Innovation and Entrepreneurship, the late Peter Drucker gives us the four basic forms of entering new markets. Twenty two years since its publication, this simple yet powerful way of thinking about new ventures is still the best way to understand the strategic options for market entry.
“Fustest with the Mostest”
In today’s entrepreneurial world, this is the domain of many venture capital deals. The strategy is one of entering a a market with an aggressive plan and deep pockets. The goal is to get in fast, catching as much market share as possible, before other possible competitors have a chance to react. Your goal is to dominate and control the market. Drucker’s perspective on this type of entrepreneurial strategy is that it is high risk, high reward. Given the small number of high potential deals that even get any venture capital funding, and the even smaller percentage that succeed in meeting investors’ expectations, Drucker’s theory still holds for this category.
“Hit ’em where they Ain’t”
This strategy is a bit more cautious. The basic approach here is to watch and learn from the mistakes and lessons of the early entries into the market. Don’t go in first, but when you do go in give the market what it really wants. The theory is that we often miss the mark when we first go into a market. There is a steep and expensive learning curve. Drucker says that this strategy is based on the notion that you should let other entrepreneurial ventures bear the cost of that learning curve, and to enter when you can have lower start-up costs and less risk. A variation of this strategy is to take a concept that has been developed and tested by someone else in another market into a new market where it has not been introduced.
The Niche
The most common entry strategy for entrepreneurs is the market niche. In a niche strategy, the entrepreneur finds a small part of a market that is not being served or is significantly under-served. A niche strategy gives the entrepreneur a safer market with less competition and a more dependent market.
Generally, a niche strategy is a good way to enter the market for a new business. It usually takes fewer resources for the start-up, due to lower marketing costs and the ability to start on a smaller scale. Success rates tend to be higher for niche businesses since they have less direct competition. Without much competition, niche businesses can charge higher prices, which allows for quicker positive cash flow during start-up and better margins once profitable.
Changing Values & Characteristics
In this final strategy, the entrepreneur takes an existing product or service and changes its value or some of its core features. This is not a simple tweaking around the edges — it creates fundamental change. It can include both additions to, but sometimes deletions of features. My favorite example, although dated, was the shift from full-service gasoline filling stations to self-service gas stations. The realization was that what people really wanted was a full tank of gas. All the other stuff, cleaning the windows, checking the oil, etc., were taken away from the “product”. People soon viewed the simpler alternative as having better value.
When thinking of a new business, make sure to keep Drucker’s strategies in mind when formulating your own market entry strategy.
Congratulations to Bryan Vaughan, one of our students here at Belmont, for winning first place in the Self-Employment in the Arts business plan competition held recently in the Chicago area!
His business is Paper Garden Records, which is described this way at their web site:
Paper Garden Records is a new, fresh and innovative independent label based out of Nashville, Tennessee. Its employees and affiliates boast a vast array of experience and hail from locations around the country. Staff members have spent extensive time working with Sub Pop Records, Saddle Creek Records, EMI Records, and Flatstock, as well as with such events as the Grammy’s, SXSW, and CMJ. It is a group of friends dedicated to introducing the music community to the artists and the music they themselves have discovered and fallen in love with.
The label’s first signing is Eagle*Seagull from Lincoln, Nebraska. Drawing on influences as diverse as Leonard Cohen and Pavement, the band takes the New York rock scene of recent days, packs it up, and heads west to their roots- making the sound their own with bittersweet melodies, a broken voice, and the plaintive calling of their instruments.
While Business Ethics is getting much more attention in the press, in the Board room, and in the classroom, I am concerned that our definition of business ethics is sliding into a legalistic world of rules compliance. I was reminded of this today at morning Mass. The priest was talking about the story of Jesus breaking the rules of the scribes about the Sabbath, through his acts of healing and teaching about the greater good.
We have to be careful not to boil morality, whether it be in everyday life or in business, down to a simple list of don’ts that serves as a checklist of how to be ethical.
Business ethics should so much more than a list of rules to follow. It should be a much broader set of standards of how we treat each other. It is the pursuit of being good in how we treat our employees, our customers, our investors, our families, our suppliers, and so forth. That cannot be boiled down to a simple checklist. Being ethical, being good, is having integrity in all that we do. It requires courage to do what is right toward others, no matter how hard it might be at certain times in our lives.
One of our current students, Bradley Martin, has been involved in the start-up team of a new independently owned restaurant called the .
It is located just up the road from Nashville in Bowling Green, Kentucky. Bradley is a great example of how we try to get our students active in business start-ups — to get their hands dirty in real entrepreneurial ventures while they are learning about it in the classroom.
I should also note that another student, Cameron Powell, operates the photography and video business that took the promotional pictures you see above. We highlighted Cameron’s business in an earlier post.
I have been working on my tee shots for the past two years — to no avail — until this week. A little adjustment in my swing (courtesy of my son) and all of a sudden I am finally smacking it off the tee box again. But alas, as soon as that problem is corrected, my faithful wedges have abandoned me. Which reminded me of something from my days as an entrepreneur….
As soon as we got through one crisis in our business, it seemed another reared its ugly head. It was a pattern that seemed to occur over and over.
I guess the continual challenge of the next crisis or problem is one of the things that makes golf — and entrepreneurship — so fascinating. Perfection is an unrealistic goal for either pursuit.
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If you are a golfer and have never played any of the Robert Trent Jones Golf Trail in Alabama I cannot give it a strong enough recommendation. The courses are beautiful and challenging and the service is great. They are also a real bargain! Add it to your to-do list.