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    NooB Monday! - (December 02, 2019) Entrepreneur

    NooB Monday! - (December 02, 2019) Entrepreneur


    NooB Monday! - (December 02, 2019)

    Posted: 02 Dec 2019 05:13 AM PST

    If you don't have enough comment karma here's where we can help.

    Everyone starts somewhere and to post in /r/Entrepreneur this is the best place. Subscribers please understand these are new posters and not familiar with our sub. Newcomers welcome! Be sure to vote on things that help you. Search the sub a bit before you post. The answers may already be here.

    Since this thread can fill up quickly, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts.

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    CES 2020 - Collaboration Thread!

    Posted: 02 Dec 2019 12:48 PM PST

    Hello Fellow Founders,

    I am making this thread in preparation for CES 2020, having attended several years as both a start-up and an individual, I wanted to offer support if anyone has any questions or concerns. Moreover, we should all support each other. If you have a booth in Start-up ally, please share, I would love to stop by! Perhaps we can organize a meet-up on one of the days?

    Is anyone interested? Suggestions? Thoughts?

    /FIT

    submitted by /u/FITGuard
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    I’ve made animated summaries of 50 of the best self improvement books. I’ve made a list of the links for each of the videos so you can find and watch the summary of the book you are interested in more easily. Hope this is useful.

    Posted: 02 Dec 2019 08:11 AM PST

    I created these summaries with a team and hope you find them useful. Let me know what you think and if you have any suggestions of what videos i should do next please let me know.

    Have a great day.

    If you're interested in future videos and want to subscribe here's a link:

    https://www.youtube.com/channel/UCfbLDMh6uGOZePAfqqjVZ-g?sub_confirmation=1

    -----------------------------

    Here are the links:

    Make Your Bed:

    https://www.youtube.com/watch?v=z7mBNcI2H1c

    The power of the subconscious mind:

    https://www.youtube.com/watch?v=UNi9zDGaZtw

    Getting things done:

    https://www.youtube.com/watch?v=oCNN2pyO5Yc&t=1s

    The power of intention:

    https://www.youtube.com/watch?v=7ezM3fIKHTY&t=1s

    Deep work:

    https://www.youtube.com/watch?v=2SOQpjHKESA&t=8s

    The magic of thinking big:

    https://www.youtube.com/watch?v=wdQRQ82AED8&t=3s

    The alchemist:

    https://www.youtube.com/watch?v=NcQjBghtxMU&t=36s

    Blink:

    https://www.youtube.com/watch?v=rie9Pkp4Ktk&t=246s

    Atomic Habits:

    https://www.youtube.com/watch?v=B6u0X0CDEqU

    The E-Myth Revisited:

    https://www.youtube.com/watch?v=ctHTVZRnE7g

    Mindset:

    https://www.youtube.com/watch?v=0QU5Q3lyTqo

    The art of war:

    https://www.youtube.com/watch?v=8_5qhA2y-E4&t=32s

    Rework:

    https://www.youtube.com/watch?v=zsaZU-HW18k

    The lean startup:

    https://www.youtube.com/watch?v=j6QPZp--lJE&t=67s

    The hard thing about hard things:

    https://www.youtube.com/watch?v=yl_Q3E5d33U&t=2s

    Crush it!:

    https://www.youtube.com/watch?v=onbmkc-29KI&t=6s

    Delivering Happiness:

    https://www.youtube.com/watch?v=GiUWCZkHbA8&t=4s

    The personal MBA:

    https://www.youtube.com/watch?v=eFpXccN3YEU&t=2s

    The $100 startup:

    https://www.youtube.com/watch?v=Cqa1LqahOLE&t=1s

    Zero to One:

    https://www.youtube.com/watch?v=RGtQjkSUahc&t=1s

    Grit:

    https://www.youtube.com/watch?v=doUSy1Eo76s

    Start with why:

    https://www.youtube.com/watch?v=LgMnlf4jcYY

    The compound:

    https://www.youtube.com/watch?v=0nSIiAMnDY0&t=218s

    The Prince:

    https://www.youtube.com/watch?v=lzVmhWFdwBQ&t=78s

    The willpower instinct:

    https://www.youtube.com/watch?v=Jz5EXLYxWDQ&t=103s

    The slight edge:

    https://www.youtube.com/watch?v=sItMk2xS_ZU

    Meditations:

    https://www.youtube.com/watch?v=ul2nuHOnCPI&t=30s

    Who moved my cheese?:

    https://www.youtube.com/watch?v=PQhJkIPHiyw

    The One Thing:

    https://www.youtube.com/watch?v=cS5lgHhbUoM&t=16s

    The richest man in babylon:

    https://www.youtube.com/watch?v=xbnHlWFnWLs&t=20s

    The power of habit:

    https://www.youtube.com/watch?v=d366w-o8nhA&t=24s

    Secrets of the millionaire mind:

    https://www.youtube.com/watch?v=R1WjeoCw30g&t=1s

    The 6 pillars of self esteem:

    https://www.youtube.com/watch?v=Y5NRiB_-w10&t=8s

    The 7 Habits of Highly Effective people:

    https://www.youtube.com/watch?v=_nGzZ9m_Xsg&t=3s

    Thinking Fast and Slow:

    https://www.youtube.com/watch?v=fqw9dwxiKSw&t=224s

    The 4 hour work week:

    https://www.youtube.com/watch?v=tCWzSlAqO0g&t=1s

    The power of positive thinking:

    https://www.youtube.com/watch?v=IAdxM_19KBc&t=1s

    The power of now:

    https://www.youtube.com/watch?v=wa7mAlLhD3w&t=35s

    Think and grow rich:

    https://www.youtube.com/watch?v=btQNKjSy8Ww&t=1s

    12 rules of life:

    https://www.youtube.com/watch?v=9InBOOy1eTU&t=26s

    The 5 love languages:

    https://www.youtube.com/watch?v=nPq4Vxh74jY

    Rich Dad Poor Dad:

    https://www.youtube.com/watch?v=GV31Wpr2Fl8&t=28s

    How to win friends and influence people:

    https://www.youtube.com/watch?v=s61o8y22BpM&t=137s

    The inside out revolution:

    https://www.youtube.com/watch?v=68OwvuqZEGo&t=31s

    Models:

    https://www.youtube.com/watch?v=Hs0d7Da8ufo&t=5s

    Man's search front:

    https://www.youtube.com/watch?v=eyXFQ5W0bMk&t=18s

    The subtle art of not giving a fuck:

    https://www.youtube.com/watch?v=dOImyOGN9UE&t=253s

    How to stop worrying and start living:

    https://www.youtube.com/watch?v=qUQXrEk52Ug

    The millionaire fastlane:

    https://www.youtube.com/watch?v=vrtjXONWVfA

    5 extremely powerful techniques to master motivation:

    https://www.youtube.com/watch?v=vmRzDIisUeM&t=37s

    submitted by /u/alwaysimproving95
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    Lessons Learned After Spending $2+ Million on One Facebook Ad Account Since January 2018

    Posted: 02 Dec 2019 07:45 AM PST

    Contrary to popular opinion, scaling ad account, or scaling anything business-related, requires skill, experience and constant hard work on upgrading the ways you go about it.

    There is no magic bullet, or "Scaling tactic" that will magically enable you to scale one Facebook ad account to 6-figures in monthly spend for 2 years in a row.

    Scaling requires constant upgrades to the team, to the process you are using to go about the channel and constant exploration of new opportunity avenues.

    Here are the main lessons that I've learned while doing it

    1. Build functional teams

    In order to scale, you need a bigger team. Period. Anybody that's telling you otherwise is just plain wrong.

    You need to build teams around certain functions that you know will need to be improved once you've gotten positive results with the channel.

    For example, you might identify that Conversion Rate Optimization is going to be a big lever (Because if you improve conversion rates by 20%, you improve your revenue by 20% and you 4x your profits). Then you build a team that will be able and responsible for constantly upgrading your conversion rates.

    That means building landing pages and running CRO experiments. So you will need a designer, developer, CRO manager that will track and document all the experiments and create scopes for the next ones. That's your functional team for CRO.

    The same goes for ad creatives. You will constantly need new creatives, how do you build a team around that?

    In my view, the roles that you will need to fill out all the functional teams are Copywriter, designer, CRO manager, Developer, video editor, photographer/videographer, media buyer.

    1. Constantly improve the process

    ​ All the big businesses are heavy process-oriented. Sometimes that means added bureaucracy and inertia to changes, but without it, large organizations wouldn't exist.

    The process that you are building is essentially the operating system for your team uses to deliver the work they need.

    Without processes, you will just be wasting the whole bunch of resources in terms of, wasted $$ on tests, the opportunity cost on incorrectly set up experiments, and $$$ wasted in terms of employee hours

    Your processes will be very fluid in the beginning as you start to notice where things fall apart and how you can fix them.

    Make sure that you constantly look for the process improvements when something goes wrong:

    1. A typo in the ad → Your QA/QC process needs improvement
    2. Invalid test results → your test setup process needs improvement
    3. You don't have clear action items after each test → your analysis process needs improvement
    4. You last 10 ad creatives haven't improved the results → your creative process needs improvement

    This is the only way you will continuously move forward and be able to scale and compete on higher levels.

    1. Don't trust platform numbers completely

    This is just a simple question of incentives (which you should always ask yourself, regardless of business/private situations).

    If you ask yourself, what are the incentives of the company, you should see clear signs where you need to be more cautious.

    So, Facebook is a public company that has the main goal to grow revenue and profits for shareholders.

    They grow revenue in 3 ways:

    1. They get more advertisers on the platform
    2. They incentivize businesses to spend more
    3. They incentivize businesses to spend more frequently

    What's the best way to incentivize someone to spend more? To show them how much money they are making with the platform.

    That's why they are promoting "1st click, people-based attribution that is more accurate than anything else because they can connect people that bought with your ads"

    To be honest, FB reporting and attribution are fairly accurate, but it's should not be the main source of truth. Always cross-check that with some other tool like Google Analytics to see how big the discrepancy is. They have the incentive to get you to spend more because that's how they survive.

    The same goes when FB rep is telling you that they need more data to optimize the algorithm better.

    1. Build exclusion audiences

    Due to incentives we've talked about before, it's really important to exclude the audiences you already have from your targeting.

    If you optimize for purchase, Facebook will show your ads to the people that are most likely to buy. That sometimes means that they will show your ads to your existing customers, or people that have visited your website → because they are the most likely to buy.

    The trouble with this strategy is that Facebook might be showing ads to people that would've bought regardless of the ad, and it reports the purchase as Facebook is the main source.

    So you want to exclude all buyers and all website traffic from your audiences so you can get the best results out of Facebook campaigns. Bonus points if you put a couple of exclusion layers (EG. Pixel-based purchases AND uploaded email list)

    1. Build data infrastructure

    Without proper data infrastructure, you won't be able to scale.

    Data needs to be showing you what kind of results you are getting from your advertising efforts.This is the first layer of data analysis.

    The second one is to identify what are the areas that you need to work on.

    If your funnel metrics are way down, you will see that in the reporting and you will allocate more resources towards building the CRO team sooner.

    Or your CPMs have drastically rose compared to last month, which represents an outside threat to your results if you don't improve the conversion and ad metrics.

    That's the basic data infrastructure in terms of reporting and really understanding what is happening with the channel.

    Advanced data infrastructure is building LTV models to understand the Lifetime Value of the customers that you are generating so that you can optimize your customer acquisition cost models.

    Basically, if you are making much more money from your customers then what you are spending to acquire them, you can afford to spend even more to acquire more customers and grow faster.

    1. Invest in video ad creatives

    ​ The marketing and advertising game is all about the information flow.

    If you take a bird's view, it's about brand relaying information to the market (people) that might benefit from the product.

    This includes understanding emotions and the ways people make purchasing decisions and putting the information in front of them in a way that is structured to trigger the actions you want (purchase)This is basic copywriting in itself.

    The reason why video ads are so powerful is that you can relay much more information in a lower amount of time compared to any other medium.

    Humans are very visually oriented animals and we get the most of our information through our eyes. Videos can give way more information in 5 seconds that any other medium can.

    For example: "This toothbrush is making people happy when they brush their teeth up and down in the toilet"

    It's probably taken you a couple of seconds to read - but if you've put that in the video, this information would be way more effective and it would've taken you much less time to get this information across.

    To conclude:

    Obviously, it's very difficult to condense all the small details and nuances that are important to scale a business or a marketing channel, but I've found these to be the most important to keep an eye on.

    If you found this interesting and valuable, I might write another post that will go deeper into the video ads and I can share the learnings from conducting this study with Facebook.

    I found it very difficult to find good content around building effective video ads online so I think it would be worthwhile to share my experiences as well.

    Thank you for attending my TED talk!

    submitted by /u/filipmerdic
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    How do companies get away with stuff like this? What it’s actually considered ‘fair use’ or ‘parody’? This seems like it’s neither of those.

    Posted: 02 Dec 2019 06:02 AM PST

    https://www.teepublic.com/t-shirt/6808783-pocket-baby-yoda

    As you can see in the link, they're clearly using baby yoda. I see these kinds of things on Facebook all the time and I always wonder how do these people not get sued?

    I googled and a lot of what I read seems to be that only a judge can really declare what is a 'parody' or blatant theft.

    submitted by /u/Syphox
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    As an entrepreneur, what are the apps you can't function without?

    Posted: 02 Dec 2019 07:16 AM PST

    Since we live in an app-age and we all, more or less, rely on apps in every segment of our lives, I am curious what are your go-to apps?

    These could be apps that help you with organisation, productivity, sales, mental-health, lead-generation, knowledge and so forth... No limits. They just have to help you be a better entrepreneur and run your business.

    I am kind of anti-app person and want to limit my on-screen time as much as possible. However, lately, I've caught myself to use more work-related apps/tools than ever.

    Here are some of them:

    1. Canva
    2. Grammarly
    3. Noisli
    4. Google Drive (and full Docs package for that matter)
    5. Asana
    submitted by /u/Shepreneur
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    When you realize your idea is doomed

    Posted: 02 Dec 2019 09:51 AM PST

    This post is not for those who have already experienced that visceral punch in the gut when you come to the realization your idea isn't going to work - this post is for people who have NOT experienced it, and might not fully grasp the importance of research, as I didn't (even though I thought I did), and the consequences of not giving your idea enough diligence.

    Here are my missteps. They're almost all psychological. I've found these are the most dangerous type because it's very tough for books and articles to really address what your own unique biases might be, and despite how many of them you've read, it's still possible to pull this kind of mental gymnastics on yourself. I hope that this short list helps someone understand that possibility and maybe help you recognize some of your own potential cognitive blind spots.

    1. I thought I could just iterate and move on if this idea didn't work. THE MISTAKE: I could have, but that didn't mean that I would. It's very easy to just keep building because "You're almost there", or "It looks so good", or "what's a few more weeks at this point?". You're never almost there, good looks don't mean much on their own, and a few weeks is actually an enormous amount of time.
    2. Lack of thorough market research. THE MISTAKE: It felt like doing research was a waste of time because there was no hard output, and no guaranteed value add. My single biggest lesson is that simply isn't true.
    3. Thinking the product is all that matters when you're getting started. THE MISTAKE: Yes, it matters, but it's not the only thing that matters. Drawing again on my lack of market research: I sort of knew I wasn't doing enough, but I just ignored that feeling because I was so excited to get building and I realize now that excitement was actually fear that my idea would be disproved.

    This would have helped me so I hope it can help someone!

    submitted by /u/Wunksert
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    Facebook disabled my ad account because there was a woman in a tank top...

    Posted: 02 Dec 2019 01:26 PM PST

    As the title states, they completely disabled my ad account over something so ridiculous. It wasn't like she had giant tits hanging out of her shirt.

    This was my first "mistake" in 6 years and they disabled the entire ad account. I've requested a review, but any other advice would be much appreciated... Especially since January is the big rush for us and I need to get out to those new/cold leads ASAP.

    Any suggestions?

    submitted by /u/QuitYourBullshit-
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    Venture Capital Dictionary: Every Term Entrepreneurs Need To Know

    Posted: 02 Dec 2019 09:02 AM PST

    I've put together a venture capital dictionary of the most important venture capital terms you need to know on your journey as an entrepreneur.

    A

    Accelerator: A group, institution or program which offers guidance, networking, and infrastructure to companies in order to accelerate their growth. In return, the accelerator is given equity.

    Accredited Investor: In certain markets and situations an investor must satisfy strict guidelines in order to be considered "accredited". In the US, for example, an individual or group of investors must meet thresholds for net worth or income, as outlined in the 1940 Investment Company Act.

    Acquisition: When a buying company purchases a controlling stake in a target business. When the board, shareholders, and managers of the target company approve of this deal, it is called a friendly acquisition. When one or more of these groups does not, it is called a hostile takeover.

    Allotment: The process of providing new shares to shareholders. A shareholder's allotment is the number of shares they are to be given.

    Analyst: Part of a venture capital firm. Usually asked to carry out a preliminary analysis of businesses before a firm offers investment. This can involve projection analysis, early stress testing, market research, and other administrative duties.

    Angel Investor: An individual investor who provides financing during a company's earliest moments. This investment is usually offered in return for equity or convertible debt and is provided in order to get a company into shape for the next financing round (usually a seed round).

    Anti-Dilution Provisions: An agreement protecting an existing investor's share in a business. If new investors are brought in and given equity, the original investor's equity is not diluted. They continue to own the same share of the business as originally agreed.

    Articles of Association: A critical document that outlines the rights and restrictions attached to a company, as well as the said company's share classes and share structure. This includes information about shareholder voting and selling rights.

    Assets Under Management: This includes all financial assets managed by a venture capital fund.

    Associate: A member of a venture capital firm. A step up from analysts, associates carry out more in-depth research and carry out due diligence.

    B

    B2B: Short for Business to Business. Simply refers to any company which does business with other businesses as their primary focus.

    Bad Leaver: This happens when an employee or staff member leaves a company and violates agreed procedures. When this occurs, the "bad leaver" disqualifies themselves from share or equity payouts. In extreme circumstances, they are not allowed to hold onto their existing shares or receive money for them. An example of a bad leaver would be an employee fired for gross misconduct or someone who resigns before an agreed date of departure.

    Board of Advisors: A group of individuals who offer advice to the management of a company. This is an informal relationship and not legally binding, but can provide valuable strategic policies.

    Board of Directors: Custodians of a company. The board of directors ("board" for short) looks after a company's affairs and makes major decisions about its future. To have a seat on board usually requires investment. For that reason, most boards are made up of investors or investor representatives.

    Bootstrapped: A business, usually a startup, which is funded purely by the main entrepreneur behind the business and/or any generated revenue.

    Bonds: A form of debt investment. In this case an investor offers a loan to a business in return for bonds equalling that value. These can then be cashed in after an agreed amount of time, and at a specified rate of interest. Bond owners are therefore creditors rather than shareholders and have no say over a company's strategies.

    Bridge Loan: A loan that bridges a financial gap. Usually used to finance a business when it is in negotiations with a large investor, to keep the business running until new investment or revenue is generated.

    Business Plan: A business plan is a systematic breakdown of how a business will develop. This clearly states any expenses needed to achieve specific goals within a given timeframe.

    Burn Rate: This is one of the least underlooked items in this venture capital dictionary but also super important. This is, in essence, the amount of money a company is using over a specified time. For example, a monthly burn rate. Used by venture capitalists to gauge how sustainable a target company's expenditure is.

    Buyout: A way for an investor or founder to exit a business. It occurs when another investor offers to" buyout" another investor or founder's shares to gain more control of a business.

    C

    Cap: A limit placed on any transaction, usually financial. This could be a cap on fundraising or expenditure. It could also be a cap on the price of shares or a cap on the number of products being manufactured.

    Capital: This refers to monetary assets that a company, group, or individual has access to for business use. You might also hear the term "working capital" to describe this, though that is most usually applied to available cash.

    Capitalization Table: A summary list for a startup. Includes investor and shareholder details such as their names, percentage of ownership, and any shares or stock class they own.

    Capital Gains: Any profit made from the sale of property or an investment. Usually taxed by governments.

    Carried Interest (Carry): A fee often charged by venture capital firm managers. Usually 20% of any generated profits. This incentivizes managers of venture capital funds to ensure that they are investing their clients' money in profitable businesses. This 20% fee usually only happens if an investment performs beyond an agreed threshold.

    Cash-on-Cash Return: How much an investment generates in relation to the original amount. For example, if an investor invests $10,000 in a business which is then later bought and they receive $100,000 in return – that is a cash-on-cash return of 1000%. Also known as Multiple on Invested Capital (MOIC).

    CEO: A chief executive officer. Responsible for all managerial decisions, and ultimately in charge of the business unless removed by a board of directors.

    Compliance: A company is in compliance when they follow all regulations and laws which are salient and binding.

    Common Stock: when you are thinking about venture capital terms this, in essence, represents company ownership. Shares allow their owners to vote on corporate policy and to have a say on serving directors. If liquidation should occur, or a sale, common stock owners are only paid an amount after bond and preferred stockholders.

    Completion Schedule: An agreed timeframe for completing all administrative and procedural tasks in order to sign off on investment.

    Convertible Note: as shared in my book The Art of Startup Fundraising, this is a legally binding agreement that if an investor loans an agreed amount of money to a business, that it can be converted into equity at a later date. For example, an investor lends $50,000 to a business with an annual interest rate of 10%. After one year, the business performs a share issue, giving that investor shares equal to $55,000. That's the original amount, plus the 10% accrued interest as equity.

    Convertible Preferred Shares: An agreement where shareholders can convert their preferred shares into common shares. This usually has a specific time frame associated with it, such as two years after investment.

    Corporate structure: A description of how each department (Marketing, Human Resource, Accounting etc.) within a business contributes to the overall vision and goals of the organization.

    Covenant: A legally binding agreement. This agreement stops an individual from carrying out a specific act. For example, an investor could agree to invest in a company if the startup founder signs a restrictive covenant. This type of covenant means that if the founder sells its ownership in the future, they cannot set up a new company that competes with the original business.

    Credit: Finances given or "loaned" to a business or individual, usually with a date of repayment set in stone. The credit becomes a debt and often has a percentage of interest placed on top of the original credit agreement or loan.

    Creditor: Individual, group or organization that lends money to a business. The creditor is who the loan repayments should be made to.

    Crowdsourcing: Innovative, hassle-free way to seek investment by using third-party companies such as Onevest to match your start-up with ideal investors.

    Crowdfunding: When investors or interested parties pool their money together to support a financial venture. Rather than having one large investor buy a large stake in a company for $1million, 10,000 people could each invest $100 each. This stops any single group from controlling everything and is in some cases easy to secure than one large investment sum.

    Cumulative Dividends: A payment made to shareholders for an agreed amount. This is either fixed or an agreed percentage of a share's price. Cumulative dividends must be paid out to shareholders with preferred shares if the original share purchase came with that agreement.

    D

    Debt: Any finances or assets owed to a creditor.

    Debtor: A business that owes a debt.

    Default: Failing to make debt payments.

    Demand Registration: Also known as Demand Registration Rights. Where an investor can force a private company to initiate an IPO or share issue so that the investor can sell their shares on an exchange. Usually only applies to common stock.

    Dilution: When an existing investor or founder's share of a business is diluted. This happens when new investors buy up equity or shares and there is no anti-dilution agreement in place. This reduces the fraction owned by current investors/founders. This is a critical term in this venture capital dictionary.

    Disruptor: Any innovation in a marketplace that disrupts the existing way of doing things. This can be through new technologies that leave existing ones obsolete, finding a new demographic for a niche, or altering the price point usually associated with an existing marketplace.

    Dividends: Profits paid to shareholders. A dividend in kind is the payment of assets instead of cash.

    Down Round: If new investors buy shares at a value lower than a previous fundraising round or share-issue, then this is called a Down Round.

    Drag-Along Rights: Force's minority shareholders to back the sale of a company. Usually forced through by shareholders holding anywhere from 50% to 75% of the stock.

    Due Diligence: A complete financial and legal assessment of a business or deal before purchase. Only through due diligence can a buyer know exactly what they are buying and its robustness.

    Dynamic Equity Split: Co-founders or investors are rewarded new shares in their business dependent on their performance. The more someone contributes, the more they earn.

    E

    Enterprise: A company or business.

    Entrepreneur: Someone who starts a business.

    Entrepreneur in Residence: A successful entrepreneur who is hired by a venture capital firm to identify future investment opportunities. They may offer mentorship to the firm's portfolio of companies.

    Equity: A portion of a company. Someone who owns equity owns a percentage of a business through shares or an agreement to be given shares at a later date.

    Exit: The end-goal for most investors. How an investor sells their share of a business, hopefully for as high a profit as possible.

    F

    Fair Market Value (FMV): After analyzing a business, this is the amount an independent third party assessor believes a company's shares are worth. When you are thinking about the venture capital dictionary or terms this one really comes into play when doing a 409A Valuation.

    Financial Forecast: Also known as a financial projection, a forecast estimates growth and income for a business over a given time, based on comparison with existing businesses and market research.

    Founder: The person or people responsible for the creation of a company.

    Funds of Funds (FoF): A fund that invests in other funds. Imagine a venture capital group that invests in other venture capital groups.

    Future Proof: Projecting into the future and protecting a business or product so that its fundamental design will keep it competitive in the future.

    G

    Ground Floor: When an investor has the opportunity to be part of a company from its first, initial moments.

    H

    Harvest Period: This is the period where a venture capital firm starts to generate returns on its investments. Usually results from an IPO, merger, acquisition, or new product launch.

    I

    Incubator: Similar to an accelerator. An organization that offers assistance to startups so that they may reach their initial investment rounds.

    Initial Public Offering (IPO): The first sale of shares traded openly on a public exchange.

    Internal Rate of Return (IRR): As part of this venture capital dictionary this is a calculation of how much money is returned on investment annually. Venture capital firms expect to see larger returns over longer periods, and so if an investment's IRR diminishes over time, VCs may sell their shares in order to free up investment for more lucrative ventures.

    Investment Period: The time taken for a venture capital firm to invest its funds across its portfolio companies. Most venture capital funds have invested all their capital after 3 – 5 years.

    J

    J-Curve: When the IRR (See Internal Rate of Return) of a venture capital fund is plotted on a graph, it should resemble a J as profits grow.

    K

    Kamikaze Defense: A last-ditch defense against a hostile takeover where a company carries out strategies to reduce its operational or financial worth. The end result is that this may make a business less attractive to investors.

    L

    Limited Partner (LP): An individual or entity such as a pension fund or insurance company which contributes capital to a venture fund.

    Liquidation: When a company is dissolved and its assets are disposed of or sold.

    Liquidation Preference: A clause in a contract which stipulates which investors receive payment first if a company is liquidated or sold, even before a company's founders in many cases. This is a common clause often used by venture capitalists to off-set the risk of investment.

    Liquidity Event: Any event which results in liquidation, such as defaulting on debts.

    M

    Market Research: A way to define consumer wants and needs. By carrying out market research studies, a start-up can then streamline its approach to be more appealing to a target demographic.

    Market Value: The amount an investor or consumer is willing to pay for something based on current consensus about how much a company, product or service is actually worth.

    Mezzanine Level: Companies which are beyond the startup phase, but not fully mature. Even though this is included in this venture capital dictionary this tends to be for more later-stage companies.

    N

    Non-Disclosure Agreement (NDA): An agreement that anything mentioned between two parties cannot be disclosed with others. This includes product information and other sensitive data. For example, if a VC firm carries out due diligence into a target company, they may have to sign an NDA so that, even if they do not make a purchase, they cannot use the information they discovered during this process. Keep in mind that even though this is included in this venture capital dictionary, VC firms hate to be presented with NDAs right away for just intro meetings.

    O

    Outsourcing: Hiring a freelancer to complete a task for your business rather than you or your employees doing it. A Common practice to reduce overheads and secure quality work without requiring full-time staff.

    Option: Similar to right of first refusal.

    P

    Pari Passu: Term used during negotiations. It means side by side or at the same rate.

    Pivot: A quick change in business strategy. Often occurs when a startup shifts its attention to a new niche or product type.

    Portfolio Company: A company in which a venture capital firm has invested, adding it to their portfolio.

    Preferred Stock or Share: This type of stock is rewarded with dividends before common stock.

    Proof of Concept: Demonstrates that a product or service will work and be financially rewarding for investors. Most venture capitalists will expect this before investing.

    Prospect: Sales speak for any customer or investor who fits a demographic. A person who is most likely to make an investment when approached. Also known as a potential investor.

    Pro-Rata Rights: Provides an existing VC investor with the option to increase his or her stake in a company during future fundraising stages.

    Q

    Qualified IPO (Qualified Public Offering): A description of a future IPO of a company. When used, convertible equity securities convert into common equity. Also used to terminate stock transfer rights for specific investors if necessary.

    R

    Recapitalization: When a company restructures its capital, changing its equity and debt ratio.

    Right of First Refusal: A contractual agreement that an investor will have the first option to buy shares or take part in another business transaction before being opened up to others. As part of this venture capital dictionary, this is an important term when you have a large corporation that wants to invest in your company as that could limit your potential outcome eliminating the possibility of a bidding war.

    Return on Investment (ROI): The amount of profit an investor makes in relation to their original investment.

    S

    Seed Round: The first financing round for a startup. Often attracts angel investors. Precedes series or "round" A.

    Secondary Public Offering: Takes place after an IPO. A share offering to the public, often when founders are looking to sell their stake.

    Sector: A market niche where a business is looking to sell its products or services.

    Series: A round of investment. Usually named A, B, C, and so forth.

    Stage: The level of development of a startup.

    Startup: A business at the beginning of its journey, usually the first couple of years.

    Syndicate: A network of investors looking to invest during a specific fundraising round.

    T

    Tag-Along Right: A legally binding agreement that ensures minority shareholders have the right to sell their shares for the same value or terms as majority shareholders.

    Term Sheet: Outlines the main points of investment, how it will be paid, what will be given in return, and what the investment will be used to achieve. Not legally binding, but provides a good foundation during negotiations.

    U

    Underwriter: An individual or firm who "underwrites" or assumes the financial risk for another party.

    V

    Valuation: When assessors, usually a third-party, calculate the value of a business through its assets, finances, revenue, burn-rate, and future projections.

    Venture Capital: Pooled finances of a venture capital group currently available for investment.

    Venture Capitalist: Individual, usually in tandem with a venture capital firm, who invests in companies, often within a specific niche.

    Venture Partner: An individual brought in temporarily to assist a venture capital firm. Not a full partner, but may identify and facilitate new investment opportunities for a VC firm.

    Vesting: Stock options provided to employees, usually as a reward for performance and duration of employment.

    W

    Warrants: A contract issued by a company allowing an investor to subscribe for shares at an agreed price during an agreed time frame.

    Window: Time frame associated with a share option or investment opportunity. This term is super important in this venture capital dictionary as founders need to continue to create urgency or the fear of missing out.

    X

    XRT: An extension that appears after a ticker symbol on a listed stock. It means that the buyer of the stock cannot legally buy shares at a lower price because the rights to do so have now expired.

    Y

    Yellow Knight: A company, investor, or VC firm that was going to carry out a hostile takeover but pulls out, offering a friendly merger instead.

    Yield: Financial or asset measurement. Usually, the amount or percentage returned to an investor for their investment. Includes share sales and dividends. The earnings an investment generates over a specific period of time. For example, one quarter or annual yield. Even though this term is included in this venture capital dictionary this is not a typical term that early-stage companies would encounter.

    Z

    Zone of Resistance: The upper limit for a share's potential value. The lower limit is the Zone of Support. Understanding the zone between helps venture capitalists and other investors gauge a good time to buy or sell the stock.

    submitted by /u/ov30
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    Starting Greatness podcast

    Posted: 02 Dec 2019 12:37 PM PST

    I've found this podcast to be incredibly helpful. The podcast talks about a lot of things that you may not have thought of regarding your business, and has helped me prepare to answer some tough questions.

    https://greatness.floodgate.com/

    submitted by /u/mhg813
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    Could I start a clothing line business under the age of 18?

    Posted: 02 Dec 2019 12:08 PM PST

    Could I start a clothing line business while i'm under the age of 18? If i cannot, why couldn't I?

    submitted by /u/JaySmooth13
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    What manufacturer of sustained release type pills can you contract with?

    Posted: 02 Dec 2019 10:53 AM PST

    I've been having a really hard time finding anyone that can do it and with a small startup amount.

    submitted by /u/stefanougo06
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    Entrepreneurs who are productive in the evenings: what do you do during the day?

    Posted: 02 Dec 2019 01:40 PM PST

    I run a home business full time and I've been noticing that after 5PM or 6PM, my focus and productivity improves/increases. I've noticed this for a few years now but I keep fighting myself and trying to work normal 9 - 5 hours... From the morning up until the early evening, I try to work but I'm just getting stressed out and wasting my own time for the most part because I cannot be productive and stay focused during those hours (unless I'm performing a task that requires minimum brain power and focus such as editing photos or doing product photography).

    Honestly, my business requires more than just 4 or 5 hours of work in the during the day but when I try to work in the first half of the day, I end up wasting a lot of time. Caffeine doesn't even help anymore.

    Question for full-time business owners that work from home: if you found that your most productive hours are in the evening, what do you do during the first half of the day? Do you struggle like I do? Or do you spend your time doing other non-work tasks for the first half of the day?

    submitted by /u/mtothej_
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    RangeMe, Faire, Hubba, Tundra, Handshake similar sites outside of the US

    Posted: 02 Dec 2019 01:09 PM PST

    Does anyone know of sites similar to RangeMe, Faire, Hubba, Tundra, Handshake outside of the US?

    I think Europe and Asia.

    submitted by /u/M77OR
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    Has anyone here had a successful kickstarter campaign, what made it work?

    Posted: 02 Dec 2019 01:04 PM PST

    Hello everyone

    I am wondering if anyone here has had luck reaching or exceeding their goals via kickstart, indiegogo etc.

    If so, what did you do to make your campaign stand out or bring awareness to your product.

    I have an idea that would be perfect for an crowdfunding, but I'm creative in marketing seems.

    Any advice, tips, success stories would be appreciated.

    Thanks

    submitted by /u/SpareTech_O
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    Those who entered a market they weren't an expert in, how did you overcome imposter syndrome?

    Posted: 02 Dec 2019 12:41 PM PST

    Start Making Big Money Growing Trees for Profit

    Posted: 02 Dec 2019 08:49 AM PST

    My business has potential, but I'm a lazy piece of garbage. How can I get my shit straight?

    Posted: 01 Dec 2019 07:40 PM PST

    I've posted on here before. I'm lazy and only work when I have to pay bills. I'm 21 and have been doing this for years. As I learn more and more, my business has become easier and easier to manage. I have plenty of case studies, testimonials and I get new clients via referrals from old clients frequently. Instead of taking advantage of these things, I just use it as an excuse to be lazier and work less.

    I know that I'm not going to change overnight. I know that it's going to take time to discipline myself and I need a game plan. What do you guys do to stay focused and keep working hard? What are the exact steps you've taken to establish a productive routine and stay motivated?

    I had a minimum wage job for two years back in high school and I routinely received employee of the month. I took it very seriously and worked my ass off. My bosses loved me. So why can't I apply that same focus and determination to my own work??? I'm absolutely terrible at being my own boss but am a hard worker when I'm being bossed by someone else. How the fuck do you guys force yourself to do shit when no one is on your ass?

    submitted by /u/fuuuck_it_all
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    Cyber Monday deal suggestion for entrepreneurs

    Posted: 02 Dec 2019 11:55 AM PST

    Any good cyber Monday deals/suggestions that new entrepreneurs should have for their business. Preferably looking for good deals on marketing tools, organizational software, etc.

    submitted by /u/mhg813
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    What print and digital collateral would a successful handyman need?

    Posted: 02 Dec 2019 10:45 AM PST

    Hello all!

    My father in law is starting his handyman business a little more seriously and for christmas, as a designer, I'm putting together a functional "brand packet" for him to look a little more legit. However, I'm not sure what paperwork and such he would need. I tried asking around but my network is mostly designers, engineers, and other things like that that I couldn't really get a good answer. Here's what i figured thus far:

    Print:

    • Warranty branded paperwork
    • Job quote document
    • Receipt document
    • Business Card

    Digital:

    • Facebook Page
    • Actual Website

    Misc:

    • Hat w/ patch of logo
    • various work shirts w logo on it

    He's a spritely older fellow so i did the design a little old school with some modern applications. I work as a designer fulltime but i think that because what he does is so.. practical and salt of the earth, he doesn't need anything crazy. His clientele is mostly old ladies who don't know how / can't do basic house maintenance things and simple remodels people don't have the time for. The guy's a beast, though; He once built an entire screened in deck (20' x 12') in three weekends. He did this bathroom remodel in one weekend:

    And just for fun, the logo I've whipped up: https://i.imgur.com/tf9sfvY.png

    It's not amazing, just something simple and a little retro.

    Anyways, what do you guys think? What else would a chill handyman need? He would be managing everything himself and he's 56, but he's also decently adept at tech stuff as well. He has an iPad he'd potentially use as well.

    If this isn't the right place, where else should I post? Thanks for your help!

    submitted by /u/frequentdoodler
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    What Do You Think The Core Survival Skills Are For An Entrepreneur?

    Posted: 02 Dec 2019 09:36 AM PST

    For people who have spent their career working for organizations, who have decided to go out on their own to start their own business (I am thinking more service related than physical products), what do you think are the core skills they need to learn to survive?

    This could be anything from learning to meditate to learning how to do your own facebook ads and anything in between. My sense is that new solopreneurs or entrepreneurs need to learn the fundamentals of productizing their offering, learning how to isolate their ideal customer, how to get the word out to that market and how to create compelling content and offers to that market evangelizing how they solve their market's specific challenge or problem with their product or service. Oh... and how to do that while balancing whatever else makes up their life.

    I am working to launch a platform for education/training, resources and coaching that focuses only on the fundamentals. The survival skills. This is not about taking a successful business to the next level. This is just about making enough to survive. To not have to go back to working for a company if that is not what they want to do.

    Thanks in advance for your feedback and insights.

    submitted by /u/TraditionalAnxiety
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    How to make your product go viral (like Tesla's Cybertruck)

    Posted: 02 Dec 2019 09:32 AM PST

    Why do people share anything?

    Almost everything viral on the internet shares 1 common characteristic: They allow the people who share to benefit personally. People gain some sort of social capital from the act of sharing.

    For Twitter, likes & retweets = the social capital gained.

    image

    The 4 incentives

    There are 4 incentives for people to share anything broadly on the internet:

    1) Communication of values

    2) Creation of tribal community based on "inside joke"

    3) Being seen as someone with privileged access to good content

    4) Being the center of attention

    Breaking things down

    Incentive #1 - Sharers get to communicate their values to others.

    Ex: Some people tweeted about Cybertruck to signal their love or mixed feelings for Tesla and their design choice.

    image

    Incentive #2 - Sharers create a tribal community on an inside joke or insider knowledge.

    Ex: Many took the opportunity to make retro-gaming references or references to the Back To The Future films. Some referenced popular & dated memes.

    image

    Incentive #3 - Sharers get to be seen as people with privileged access to good content & products.

    Ex: Influencers, tech people, and people with a good amount of $ laying around signaled their ability to purchase a cybertruck or preview it live.

    image

    Incentive #4 - Sharers get to be the center of attention for a split second.

    Ex: News & media outlets rushed to join in the cybertruck frenzy to attract some of those eyeballs to your articles for some sweet advertising revenue.

    image

    Another important concept: People also tend to share when they feel joy or surprise.

    Coupled with the Cybertruck's unique shape & design, Elon's demonstration of the Cybertruck's "impenetrable" glass windows left everyone, including himself, quite surprised.

    video of a surprised Elon

    Key Takeaways

    Remember these keys to building a viral product:

    - Next time you create something, ask yourself "What can others gain by spreading the word about it?"

    - Incentivize your audience to share your product, with either tangible or intangible rewards —i.e. social capital.

    - Inspire joy or surprise in your audience.

    Acknowledgement

    Big thank you to Thales Teixeira who conducted studies on consumer attention and documented his findings in a paper for Harvard Business Review, where I learned these concepts from.

    ----

    My name is Anthony & you can find more product breakdowns like this at The Product Person

    Thanks for reading :)

    submitted by /u/antdke
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    Thoughts on starting a co-working space?

    Posted: 02 Dec 2019 08:04 AM PST

    Hey, A friend recently approached me about starting a co-working space in the downtown area of a medium sized city. There seems to be quite a lot of people looking for desk space in the area so I was wondering what everyone's thoughts were on what makes a good space in terms of amenities and features. The process seems pretty straight forward: lease office space -> renovate space -> sublet to individuals and small businesses.

    I would like to help guide my friend but I have not operated in this space before, am I missing something? We have already looked at rents vs. monthly fees and it seems like there is margin for profit to be made.

    submitted by /u/SlightDrizl
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    How I started a $69K/month software agency after a failed product launch

    Posted: 02 Dec 2019 08:00 AM PST

    Hey - Pat from StarterStory.com here with another interview.

    Today's interview is with Andrew Askins (u/askins4trouble) of Krit, a brand that makes custom apps

    Some stats:

    • Product: custom apps
    • Revenue/mo: $69,000
    • Started: April 2014
    • Location: Charleston, SC / Remote
    • Founders: 3
    • Employees: 3

    Hello! Who are you and what business did you start?

    Hi, I'm Andrew 👋I like to joke that I'm a jack of all trades and master of pun…

    I run Krit, the software agency for non-technical founders. We partner with people who are experts in their field to help them design and build their Minimum Lovable Product. We get in super early and truly help our clients design and build apps from the ground up. Sometimes they've prototyped their ideas with a spreadsheet or a couple of no-code tools, but they don't have any software yet.

    We're massive product nerds who care about all of the little design details the make great products stand out, while also having deep technical knowledge. Basically… come for the pretty designs, stick around for the well-written code.

    In the past 3 years we've helped:

    • An attorney take her legal tech startup from $0 to $1M in Annual Run Rate.

    • A 71-year-old financial consultant build his first tech company and close customers like Yale, Brown, NYU, and Dartmouth.

    • A doctor in Texas launch the first HIPAA compliant text messaging service.

    • A photo booth startup build tools that are used by Amazon, Uber, Red Bull, NBC, the NFL and more.

    image

    What's your backstory and how did you come up with the idea?

    I never set out to start a software agency. Growing up I never thought I would be an entrepreneur, or even get into tech.

    But when I got to college I decided to take an intro to Computer Science class. My plan at the time was to teach math in the Peace Corps. I didn't like math enough to be a math major but figured Computer Science would be interesting and involve a lot of math.

    Luckily I had an incredible professor - he explained object-oriented programming to us using LOLcats - and I got hooked. I started reading everything I could about programming and discovered the startup world. The idea of being part of a small company working on interesting problems was super exciting.

    Through a friend of my uncle's, I got an interview with a new startup in town. I bombed the interview, but they had no money and I was willing to work for dirt cheap ($500 per month) so I got the job. I was lucky to be in a situation where I was a student with scholarships and some college savings from my parents, so most of my costs were covered.

    In the first 6 months I was there we launched 6 mobile apps, and I was a lead developer on two of those. It was trial by fire, and I can't imagine a better place to learn. But being the precocious punk that I was, I started thinking of all the things I would do differently if I was running the show.

    Through the company, we met some people who were starting an accelerator program. They were looking for technical founders (this was Columbia, SC and all of their other applicants were non-technical) so they recruited us to join. We applied, got in, and they gave us $16,000 and 3 months of mentorship to help us get the business off the ground.

    image

    We made a Dollar Shave Club style video for our application and convinced all of our friends to help out. We even made our own PVC pipe steady-cam

    We still weren't thinking agency, though. We wanted to be a VC backed startup. We were going to bootstrap long enough to get some traction and then raise money and build a big team.

    When we entered the accelerator our idea was to build a design community like Dribbble but centered around critique (this is where the name Krit comes from). I was trying to learn design at the time and was frustrated by how hard it was to get advice and critique online. Over the first year and a half, we pivoted multiple times. We went from a design community to a project management tool for designers and ultimately launched a contract tool for freelancers called Ink.

    image

    An early mockup of the project management tool we worked on for several months

    We launched on Product Hunt and made it to #2, acquiring a few thousand users in the first few days. Then we hit a wall. We had all these users, but no one was paying us for the product. The more we talked to people to try to figure out why the more we realized most freelancers didn't value contracts.

    image

    We thought about trying to find a new market or launching a new product. But at this point, we were burnt out and running out of money. At the same time, we had started taking on some consulting projects to pay the bills. We were actually making money doing that and we're also really enjoying it. So two years into our business we made the tough decision to shut down our product and go fulltime as an agency.

    Take us through the process of designing, prototyping, and manufacturing your first product.

    Our very first consulting gig came from my old bosses. They needed some extra design help and reached out to us about designing an app with them. We charged something like $5,000 to design it for them, which at the time felt like a huge amount of money.

    Then, we got another gig from one of the guys running the accelerator. He was working with a local non-profit to develop a new system that would source ideas from the community for local improvement projects, then fund them. We designed and built a Hacker News/Reddit/Product Hunt style website where users could submit ideas, vote and comment on them. We got paid a whopping $2000 for that project, but we were just excited to be working on a cool product that helped the community.

    Our first big project came from the Workshop service, which at the time was a paid newsletter full of project leads. We saw a lead for a Cannabis startup called Stonius looking for help with a landing page. I emailed the founder cold, and we got the job. The landing page did well, converting traffic at a roughly 10% rate, and so the founder approached us about building their Cannabis jobs platform.

    This whole time, we weren't really designing the service at all. We were just trying to make ends meet. We would take any kind of work we could get and then do the best job we could. I credit my partner Austin for getting us most of our work. Our code was alright, and I could talk to people, but it's his design work that has always helped us stand out.

    Again, it helped that we kept our costs low and undercharged too. We kept paying ourselves $500 per month through this whole time, all just scraping by. We charged $60 per hour for Stonius, and made roughly $32,000 on the MVP. One of the requirements was also that we would sign a contract using Ink so that we could dogfood our own product.

    Describe the process of launching the business.

    I remember the day we decided to shut down Ink vividly. We were working out of a coworking space in Columbia. There was no conference room, so we would hold our team meetings while walking around downtown. We walked over to the State House and were sitting in the grass. We had to reckon with whether we were willing to abandon the last year and a half of work, and if we were satisfied building an agency.

    Once we decided that was what we wanted it was full steam ahead. We let our users know we were shutting down, and spent the next month creating a new brand and website.

    image

    Check out this sweet gradient that would change colors every few seconds

    The launch wasn't nearly as dramatic as launching Ink had been. We didn't stay up all night beforehand, or suddenly get thousands of customers. We pushed the site out to our network, told our mailing list what we were doing, and then focused on looking for work.

    We tried blogging, cold email, and reaching out to other agencies for overflow work. But just like before, most of our early work came from our network.

    • Photo booth software - cold email

    • Non-profit website - Austin's cousin

    • Edtech website - a friend from the incubator we originally worked out of

    • Real estate platform - overflow work from my old bosses

    In early March, we got our first serious traction. A friend reached out because an investor in his company was looking for a team to help him build a HIPAA compliant messaging service. We met with him over the phone and took a week to quote it out. Our initial quote turned out to be massively underestimated, but it still came in at just over 6 figures. We were thoroughly convinced he would laugh it off. Then a few weeks later, before we even had a contract signed, a check came in the mail for $100,000.

    Since launch, what has worked to attract and retain customers?

    Finding new clients is our biggest struggle. "Non-technical founders" is a much smaller niche than we started in (when we would literally work with anybody) but it's still broad. Our clients have been real estate agents, lawyers, financial consultants, doctors and cybersecurity professionals. But 99% of the people in those fields will never even think of building a software startup. And for the 1% that will, we need to be in front of them at precisely the right time.

    This means that outbound sales (cold calling and emailing) and ads have never worked for us. What does work is content, word of mouth and growing my personal network.

    The majority of our clients still come in as referrals from my personal network. So I spend a lot of time online and in real life trying to meet interesting people and be helpful.

    If I get hit by a bus tomorrow though, that won't help the business. We can hire salespeople and encourage them to do the same, but I haven't figured out yet how I would train someone to do what I do.

    So instead, a year and a half ago we decided to start investing heavily in content. Right now this means producing super high-quality blog posts and newsletters, although in the next year I want to launch a video series and/or a podcast. It's showing some early signs of traction, in the last year we've closed close to $300,000 in business through our content. This often still looks like referrals, but it's a referral from someone we've developed a relationship with through our blog or newsletter instead of through coffee meetings.

    image

    image

    image

    The main ways we promote the content we write are email (through the Krit newsletter and the Startup Watching newsletter which I purchased in 2018), organic search and twitter (largely through my personal twitter account).

    When it comes to retaining clients, we do a much better job than we do acquiring clients. This has been our main source of growth. A client typically stays with us for 2-3 years once we start working together.

    I can't tell you exactly why that is except that:

    • We care about producing business outcomes, not just making money off of our clients.

    • We're honest, there are a lot of dev shops out there that are shady as f*ck so we focus on being transparent and honest even when it's hard.

    • We do what we say we're going to and try not to create additional work for our clients - the consultants I've hired personally that I've hated working with are the ones that make me babysit them or think MORE about the thing they're supposed to be taking off of my plate.

    How are you doing today and what does the future look like?

    This year we're on pace to do over $700,000 in revenue, with a profit margin of about 20% which we're tremendously proud of. Last year our revenue was just under $400,000 with a profit margin of about 15%. That's 75% growth YoY which is pretty huge for a small agency.

    Coming into this year our goal was to focus on profitability and stability. We wanted to really improve the mechanics of the business to set ourselves up for stronger growth in the future.

    We've considered reinvesting those profits in the business, potentially expanding into products of our own. While I expect we will eventually launch one or more info products (books, courses, etc.) for now we're continuing to focus on what's working, which is our core service offering. This means in the next year we want to grow our development team, double down on content and find someone who can focus full time on either sales or marketing.

    We're also excited to start a profit-sharing program for our employees this year, and so we don't want to dip into those profits just yet. We will keep enough cash in the business to have 90 days cash on hand, whatever we do.

    Our team today is 8 people strong, with 6 full-time. We're a majority remote team, with members in Canada, Ecuador, and the Southeastern US. We're planning our first team retreat in December, flying everyone to Charleston where we're headquartered and renting a beach house for a long weekend.

    image

    Our longer-term goals are intentionally nebulous. I like to say that my 5-year goal is to get Krit to the point where I could walk away but won't want to. We know that we want to continue to focus on building a world-class culture and designing products that delight and help users.

    Through starting the business, have you learned anything particularly helpful or advantageous?

    There are a few big turning points from the past 5 years that jump out at me. These concepts took me a long time to learn, and I'm still learning them, but they've helped us by leaps and bounds.

    Someone needs to be focused on sales and marketing

    We started as 3 technical founders and so we spent most of our time doing what we did best… programming. As a result, we constantly struggled with sales and marketing. While we certainly aren't world-class marketers these days, as soon as I stopped coding and started focusing on the business full time we started trending in the right direction.

    image

    Embrace positioning

    It took me a long time to realize that how you talk about yourself is just as important as what you do. Customers don't have time to sort through your work or your product and figure out what you are and who you're for. You need to tell them. The narrower your positioning the better (although we've built a solid business around a broad position).

    Free quotes are a waste of time

    This is specific for consultants, but unless you have a completely productized service don't waste time on free quotes. You'll end up spending tons of time doing free work for tire kickers. We developed a Roadmapping Session which costs $3500 and is a requirement for working with us. It's the perfect way to weed out who is actually going to be a good fit for us.

    Leveling up your clients is the fastest way to level up your business

    At the beginning of 2019, we were struggling. Our team was overworked, I was stressed about the direction the business was going, and even though we were making money we weren't happy. We fired two of our clients, which is one of the hardest decisions I've made yet, and things started to turn around right away. Now when we hit road bumps I'm not scared, I know we can handle it, and part of that is the trust I have in our clients.

    What platform/tools do you use for your business?

    Oof. We use a ton of software to run our business. Here are just a few:

    • CraftCMS - website

    • Airtable - Content calendar, CRM

    • Figma - we've used every design tool out there, but lately, we've really been liking Figma

    • Notion - internal company wiki (I'm hoping to publish this soon)

    • Trello - project management (maybe the most important tool on here)

    • Superhuman - email

    • Blurt - writing

    • Google docs - writing

    • Convertkit - newsletter

    • Google sheets - financial dashboard, project planning, frickin' everything

    • AHREFs - SEO research

    image

    We've played around with a bunch of social media tools, but I've become convinced they're a net negative. At least for a business our size. They take you out of the platform and thus out of the conversation. I look at Twitter as a tool for building relationships as much or more than a place to promote content.

    What have been the most influential books, podcasts, or other resources?

    We wrote a whole blog post about our favorite articles, podcasts, and other resources for entrepreneurs. Laura, our lead writer, and I spend a ton of time reading the content. We both love learning from others. Here are a few of my personal favorite books:

    • Atomic Habits - how to design your environment to build good habits and be successful

    • Lost and Founder - how to be an empathetic leader and not get fucked by VCs

    • Traction - a crash course in marketing, I give this to most of our new founders

    • No Hard Feelings - reading this now, it's an excellent book about emotions at work

    • The Alchemist - everyone should read this, it'll make you a more thoughtful person

    And a few of my favorite podcasts:

    • Armchair Expert - my favorite podcast, Dax Shepherd interviews experts and celebrities and asks about their insecurities, motivations, addictions and all that good touchy-feely stuff

    • Startup - the first season came out the year we started Krit and listening is like therapy for a new founder

    • IndieHackers - Courtland Allen runs one of the best communities for founders on the internet and is an incredible interviewer

    • Listen Money Matters - all entrepreneurs should care about personal finance and this podcast makes it fun

    • The Catch Up Call- one of my new favorites from Jon and Marshall, two former co-founders, there's no one else who does a better job of staying on top of weird trends

    Advice for other entrepreneurs who want to get started or are just starting out?

    Business is 90% about positively manipulating your own psychology.

    I'm becoming increasingly convinced that business is less about tactics and numbers and more about understanding yourself (and your team members if you have a team). Almost every problem you will face is a people problem. Sales not working? The problem is either the salesperson (probably you in the early days) or you don't understand your customers.

    Some marketing tactics don't work simply because they're not authentic to the people implementing them.

    Go to therapy, hire a business coach, work on your shit. Learn what makes you great and where you need help. It will be worth every penny.

    Are you looking to hire for certain positions right now?

    We're not hiring right now, but plan to grow more next year! In 2020 we want to hire 3 new full-time positions:

    • Backend Developer

    • UI/UX Designer

    • Marketing Director

    If you're interested, email me at andrew@krit.com, I'd love to talk to you. We're a transparent, remote company with competitive salaries and full benefits. We're also obsessed with building a healthy and supportive culture to help our teammates grow while maintaining a healthy balance to life.

    Where can we go to learn more?

    If you have any questions or comments, drop a comment below!


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    submitted by /u/youngrichntasteless
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    Logo Design

    Posted: 02 Dec 2019 08:00 AM PST

    I have been doing freelance graphic design for two years now. It's been difficult to find clients consistently and would love some advice on how to seek out/find clients that need design work done.

    submitted by /u/twiggscreative
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