Tag Archives: Opportunity

When Do You Focus on the Plan and When Do You Adjust? Four Guidelines

Interview with Phil Bookman, CEO, Assistyx

Situation: The dynamics of an early-stage business require balance between focus and opportunity. The challenge is in the balancing act. When do you focus on the plan, and when do you adjust?

Advice from Phil Bookman:

  • Never allow your friends to become statistics. We call our customers our friends. Our most loyal and vocal friends were our early adopters and got us where we are today. They remain important participants in the conversation and are always in our focus.
  • Along the same lines, when using social media to communicate to your audience, remember that this is a face-to-face conversation. This is a key point of focus.
    • Remove as much friction from online interactions as you can. Make it as easy as possible for people visiting your web site to buy. This requires both live interactions with users and attention to detail. If a question keeps coming up, answer it; put the answer right up front on your web site where it cannot be missed.
    • We’ve made hundreds of tweaks, each tiny. Each has removed a point of friction. As the company grows it is easy to lose sight of these details. Never lose sight of details.
  • Much of what we face in business is transitory. It is important to stay nimble so that you don’t get stuck fighting the last skirmish. For example, in 2009, we found that a subscription service was difficult for institutional users like purchasing departments in schools to understand. It isn’t now.
  • You must be careful not to chase bright shiny objects – opportunities that take you outside your principal market competence. Would you try to modify a hammer to put in screws?
    • Our principal product TapToTalk is a communication device for kids with verbal challenges. Some have suggested that it could also be a teaching device. Possibly in the future there will be room in our plan for a teaching device, but we will address this as its own market and application when we are large enough to diversify.

You can contact Phil Bookman at [email protected]

Key Words: Early Stage Business, Focus, Opportunity, Balance, Adjust, Early Adopter, Social Media, Friction, Detail, Nimble

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How do You Fund a New Venture in a Mature Market? Seven Strategies

Interview with Chuck Gershman, Founder and Former CEO, Bay Microsystems

Situation: Following a consolidation of equipment suppliers, the broadband network market has matured with a few large players. This potentially reduces diversity and creativity because barriers to entry are now enormous. How do you fund a new venture in a mature market?

Chuck Gershman’s Advice:

  • If you can get the venture off the ground, the opportunity is tremendous because competition for new approaches in a mature market is limited. Large players don’t move quickly. Their incentive is to change slowly to lengthen product life cycles.
  • The downside is fewer financiers interested in the space because of the barriers to entry, and because the likely exit is an M&A play at low multiples.
  • Given this, how do you attract investors?
    • In the hardware space, you must demonstrate a convincing go-to-market strategy with modest investment and a moderate cost of market penetration. If the cost of success is high, it requires too much investment and risk before you can accurately assess the possibility of success.
    • You must be able to show a substantial total available market.
    • You must be able to show that your capability meets the needs of the market.
    • You must be able to show that the customer base will respond en masse. This is critical!
    • With fewer investors willing to look at your product and technology, it takes more time and work to find interested investors.
  • Investors invest on perceived risk, so the task is to show that the risk is manageable.
    • In the past, investors were convinced by a committed strategic customer that would finance bringing the product to market.
    • In the current market, an effective strategy is to develop an early customer who is a strategic investor in your company from Day 1. This raises the likelihood of an exit, and appeal to investors, but reduces downstream options and ROI.
    • Another strategy is to pursue a creative IPO exit. For example, launching the IPO on a smaller foreign exchange. This reduces the long-term payout to founders, but may increase appeal to investors who prefer an IPO to an M&A exit.

You can contact Chuck Gershman at [email protected]

Key Words: Mature Market, Diversity, Opportunity, Investor, Go-To-Market, Risk Assessment, Strategic Partner, Strategic Investor, Exit, M&A, IPO

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How do you Maintain Focus on your Core while Expanding? Six Considerations

Interview with Clark Avery, President & CEO, Aesyntix Health

Situation: We’ve established a strong core business and it is time to diversity. Our principal growth opportunity is complimentary to but a different business model from our core. What are best practices for maintaining focus on core business while developing a new opportunity?

Advice:

  • First and foremost, be emotionally and strategically ready to make the bet and commit to action.  In doing so you must “know thyself.” Specifically, taking a long look to determine whether you tend to overanalyze or are too quick to pull the trigger. Understanding your tendencies will help in the steps below.
  • Establish the prerequisites for pulling the trigger. For us we had to determine the:
    • Level of operating stability for the core business that will allow you to split focus.
    • Level of financial stability and predictability that will support both core and expansion efforts.
    • Level of organizational and process stability that will allow you to take on the new opportunity.
  • Understand and define the differences between the old game and the new game.
    • What are the financials of the growth opportunity? How do they differ from your core business? Are there conflicts that must be resolved?
    • Can you launch an innovative solution to differentiate the new offering?
  • Gather enough understanding of market need that you will satisfy with the new opportunity so as to be able to address it effectively.
  • Establish a sound execution strategy and timeframe for launching the new business.
    • Some/many of your decisions will be wrong. You need the resources to tolerate a learning curve while running fast towards your goal.
  • Draft a leadership development plan of both the core and new business before you start. This plan must define the skill sets and growth needs of each business.

You can contact Clark Avery at [email protected]

Key Words: Diversify, Opportunity, Focus, Stability, Market Needs, Execution, Leadership Development   [like]

Good News – Business is Building! Now, What to Pursue? Four Guidelines

Situation: The business climate is starting to improve. Opportunities are coming in. How do you decide what to do and what not to do?

Advice from the CEOs:

  • Talk to your customers. What do they value about your product/service and what is less valuable? Build on opportunities that customers value – which are consistent with your company’s strength and focus.
  • Consider a customer survey – Survey Monkey or a telephone.
    • If you don’t have in-house expertise to design and administer a survey, find knowledgeable outside resources.
    • Make sure that the survey questions will drive understanding of your focus.
    • If you are short of cash, at least get an expert to review the survey and administration plan.
    • Before you launch the survey to your full customer base, “test” it with a select group of customers – this will tell you whether it will produce usable information. If not, rewrite.
    • Have employees take the survey and predict how customers will respond. Compare these results with the actual results from customers. You may learn something!
  • Which opportunities will build sustainable recurring revenue vs. opportunistic (one-time) revenue?
    • Recurring revenue can be lower margin if the income stream is sustainable.
    • Balance efficiency and utilization. For example, fixed fee service contracts that renew consistently.
  • Judge opportunities against your “Hedgehog” as defined by Jim Collins in Good to Great:
    • What you are passionate about?
    • What you can be best at in your marketplace?
    • What you can measure by a single economic ratio?

Key Words: Customer Needs, Customer Survey, Business Opportunities  [like]