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Starting a business is like playing at Pooh Sticks

Bryan Mills

During a recent training event I was fortunate to hear Bryan Mills speak. Bryan has had a long and successful career creating and managing IT related businesses (although without an IT background himself). His particular claim to fame is building CMG from a two person business, operating from the founder’s homes in 1965, into a multinational FTSE1oo business.

During his fascinating talk recounting lessons learnt from a lifetime as an entrepreneur he used the analogy of playing Pooh Sticks for business start-up.

As both a fan of the game from early childhood, and having grown up very near to the home of Winnie-the-Pooh the inventor of the game in Hartfield, West Sussex, Bryan caught my attention.

When you are planning to start a business you look down into the swirling river below (the market place for you product or service), you try as hard as you can to see where the current is flowing strongest and is least turbulent (assessing the market opportunity with published and field market research). You drop your stick in as carefully and accurately as you can (detailed business plan preparation). And once it is in, you follow it with Eagle eyes, watching every bob and weave (you track every activity minutely in your newly founded business).

However once the stick goes under the bridge it moves both out of your control and out of sight, and there is nothing you can do to influence its route down the river, across into a bank of reeds, or dropping down to the bottom of the river bed. This is very much the situation once your business is up and running. All kinds of unpredictable events can knock you off course, or sink the business altogether.

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Karan Bilimoria and the story of Cobra Beer

Cobra_Beer_bottleAnother late night for me last Thursday night. This time to attend the Chartered Management Institute 2009 Sir Kenneth Cork lecture. It was organised by my friend Chris Seow from the University of East London who is the current chair of the City of London Branch of the CMI.

I have to admit I was reluctant to spend another evening in London and went along to support Chris. However, I am glad I made the effort as the talk by Karan Billimoria was absolutely fascinating.

Even while waiting for Lord Bilimoria to start I heard an amazing story from Darren Way the founder of Streets of Growth.

Streets of Growth is a dynamic community leadership organisation founded in 2001 and led by local people in Bromley by Bow East London. Committed community adult and young people work together to offer real solutions and practical approaches to tackling the issues that people face in their local community and so develop sustainable and healthier communities in the East End.

karan-bilimoriaAlthough I had not been following the Cobra beer story closely, I was aware (along with everyone else in the audience) that they had gone bust in May of this year and had been rescued by the giant Canadian brewery firm Molson Coors.

I was wondering if Lord Bilimoria would mention what seemed to be an unfortunate end to what had been an amazing success story up till that time. His first slide gave an indication that he would not be skirting around the painful aspects of his fascinating twenty year story to bring a new beer brand into mass consumption. The title of the slide was ‘Adapt or Die’. He immediately began to explain how quickly the
credit crunch had impacted high growth business such as his, who were dependent on external finance for expansion. As he pointed out, prior to the crash, cash had been king, but then it became an emperor.

Fortunately, he then went back to the beginning of his story, and spent an hour giving an absolutely riveting speech which concluded with the painful details of the collapse and eventual revival of the business.

As with so many entrepreneurs Lord Bilimoria went against his parents wishes with his plans to start his own business. Although his father as head of the 350,000 strong Indian Army did not want Karan to follow him into the military, he felt a career in the City of London would be a more appropriate use of his Cambridge University education. He was told ‘you should get a real job like a banker’.

But, he had developed a love for beer and recognised there was a significant gap in the market between traditional British bitter beer, and the sharp and gassy lager beers available at that time. There was nothing that was a suitable accompaniment to curry meals in Indian restaurants.

The second slide of the talk consisted of just three words, ‘Aspiration, Inspiration, Perspiration’. He reinforced my experience of dealings with entrepreneurs that the business idea is the easy part. Bringing it to production and then to the market is the hard bit, and may take many years.

Lord Bilimoria went to give many instances when his business nearly died. Often from causes which could never have been predicted. For example, a one year boycott of his product by Indian restaurants (his primary customers), after an article criticising the professionalism of the restaurant owners in a trade magazine which Karan had founded, but no longer had links to. In each of these ‘near-death’ experiences it was always flexibility and a creative approach that led to a solution.

It was good to hear his quite confidence about the new opportunities the partnership with Molson Coors would lead to. He said they were moving from a David vs Goliath situation to one where David and Goliath were working together. He had been impressed by the family culture that was still present despite the global size of the company, and how they had been true to their initial agreement despite the financial turmoil of the period when Cobra was forced into a Company Voluntary Arrangement.

He concluded by listing the Molson Coors definition of what makes a remarkable brand:
1.    A compelling story
2.    Refusing to compromise
3.    An instantly recognisable look
4.    A unique, relevant and consistent product
5.    To inspire brand champions from customers
6.    To deliver enduring profits

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Global Entrepreneurship Week 2009

global_entreprenuership_weekIn just over a months time it will be Global Entrepreneurship Week 2009. To be precise, it will run from 16 to 20 November and consists of thousands of events around the world, promoting and celebrating entrepreneurship.

This year we are holding a week of special events and workshops, covering essential skills, getting inspiration and confidence, and chances to meet great contacts.

Each day has a different theme, focusing on a particular area of business.

Here is a summary of our activities, with more information on our website pages:

Monday 16 November: Business basics day -The essentials you’ll need to get going in business – finance, market research and business planning.

Tuesday 17 November: Innovation day – Learn how to protect your ideas and make money from them, plus an evening with Lord Sugar.

Wednesday 16 November: Women’s enterprise day – Meet a whole host of female entrepreneurs, from the big names to women that are just getting started.

Thursday 18 November: Social enterprise day – Start thinking about how you could make your business more ethical or take the plunge and set up a social enterprise.

Friday 20 November: Home enterprise day – Find out more about working from home, watch our free online seminar, and meet other home workers.

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Saving Britain’s business future

The September issue of Real Business magazine has two mentions of the Business & IP Centre which are so flattering I can’t resist sharing them here.

In an article titled Saving Britain’s future, Charles Orton-Jones produces a 10-point manifesto to rescue Britain’s economy. At number three on the list is Open Business & IP Centres in six cities. To quote the initial text,
‘In 2006, the British Library opened the Business & IP Centre. The centre fuses the British Library’s vast repository of databases and commercial documents with a plethora of services for entrepreneurs – a sort of Pimp my Business Link.’

A few pages later on, in the article 27 champions of entrepreneurial Britain, Catherine Woods puts the British Library in at number 15 – behind Peter Jones, but ahead of Alan Sugar and Richard Branson.

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I met the Prime Thinkers mentors

It’s been a busy few weeks for me recently (so much for a quiet summer). So I have quite a few events still to catch up on.

Our Meet the Mentors event on the evening of Tuesday 30 June was a great success, with around 30 mentors and 90 mentees. With a 3 to 1 ratio, and two hours to network, the mentees had plenty of opportunity to find subject experts to match their interests.

I took a group of the mentors around the Business & IP Centre before the event started, as many of them were not aware of the range and depth of our information and services. It was yet another reminder of how much work we still have to do to spread the word about the Centre.

Maurice Collins, the man behind our very popular Weird and Wonderful display last year was his usual charismatic self and reminded the audience of the expanding Prime Thinkers groups, and how all the money from the £100 fee goes to his Kith and Kids’ charity. Their aim is to empower families living with disability to overcome their social isolation and access the services they need.

kith_and_kidsGiven the enthusiasm of my colleague Clare Harris who organised the event, I’m hoping this will be the first of many Meet the Mentor evenings.

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Start-ups who think big

On my way home the other evening I noticed an unusual poster advertising the Daily Telegraph newspaper. The poster consisted of three of the photos below, and was a salient reminder of the humble beginnings of what are now household names.

Some of the entrepreneurs I meet have no greater ambition than becoming their own boss and making enough money to be comfortable. However, some have global ambitions right from the beginning. Last week I saw a client who has patented an invention which if successful could be in every home in the world which uses electricity.

It pays to think big. Branson?s first store: Richard Branson?s first foray into business was a mail order record company.

It pays to think big. Before it became a computing power house, IBM used to manufacture and sell machinery ranging from commercial scales and industrial time recorders to meat and cheese slicers.
BM 1930: Before it became a computing power house, IBM used to manufacture and sell machinery ranging from commercial scales and industrial time recorders to meat and cheese slicers.
It pays to think big. Lamborghini started out as a tractor-building company in the Italian village of Sant'Agata Bolognese.
Lamborghini 1955: Lamborghini started out as a tractor-building company in the Italian village of Sant'Agata Bolognese.

It pays to think big. When Nokia was first formed they produced a number of products including bicycle tires, aluminium and Wellington boots.

It pays to think big. William Harley and Arthur Davidson built their first motorcycle in a friend?s wooden shed, in Milwaukee.

It pays to think big. Ingvar Kamprad, aged 17, set up Ikea in a shed in Smaland, Southern Sweden.
IKEA started here. Ingvar Kamprad, aged 17, set up Ikea in a shed in Smaland, Southern Sweden. From here he distributed Christmas cards, packets of seeds and pens.
It pays to think big. Larry Page and Sergey Brin set up Google as a research project while they were Ph.D students at Stanford University. In 1998 they moved into Susan Wojcicki's garage at 232 Santa Margarita, Menlo Park.
Google started here. Larry Page and Sergey Brin set up Google as a research project while they were Ph.D students at Stanford University. In 1998 they moved into Susan Wojcicki's garage at 232 Santa Margarita, Menlo Park.

It pays to think big, The Daily Telegraph, Britain’s Broadsheet
It pays to think big is the Telegraph’s major new advertising campaign to promote Britain’s best-selling quality daily paper. It pays to think big, proudly celebrates the fact that the Daily Telegraph is the only quality daily paper in the broadsheet format – giving readers more coverage of news, sports and business.

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Marketing Maestros: Innovative Strategies for Small Businesses

Many thanks for writing a blog article about Marketing Maestros!  Just a thought – if possible, would you mind adding a link to the webcasts as well?  http://www.inspiringentrepreneurswebcast.co.uk/

Once again a great Inspiring Entrepreneurs panel this evening, with regular chair Matthew Rock (the founder-editor of Real Business) brining his inimitable enthusiasm to the event.

(You can still watch a  webcast of the event at http://www.inspiringentrepreneurswebcast.co.uk/)

Ajaz Ahmed Chairman of AKQA, the world’s largest independent digital agency showed some impressive examples of innovation in advertising, illustrating his point about the importance of originality.

His key message was for his company to let their work do the talking’. In other words, don’t tell you customers how great you are, show them.

Not surprisingly Simon Calver the CEO of LOVEFILM (a £100 million turnover company) is a fan of films, and so used examples to illustrate his four P’s of business success.

P1 – ‘I’m going to make you an offer you can’t refuse’ (The Godfather).
Focus on the consumer proposition first and worry about building the brand later on. The three legs which hold up his company are choice, value and convenience.

P2 – ‘Self preservation society’ (The Italian Job) i.e. Preserve the cash in the business. Make sure you focus on the time it takes to get cash in and out. If you get it right it gives you a competitive advantage. Also analyse everything you do – where you spend your cash and how you do it.

P3 – Spin City (American sitcom)  Never under-estimate the importance of PR. In his case they have three targets, their investors, trading partners and of course their consumers. You have to be constantly creating new stories about your business the papers will want to publish.

P4 – Passion (a choice of seven films according to Wikipedia) Make sure you surround yourself with great people from the beginning. ‘Fiirst division people recruit first division people’, which makes the business great. Make sure you have fun too. Simon hosts a monthly BBQ for his colleagues. Also reward your people on a quarterly basis (in the case of LOVEFILM bonuses of between 10 and  20%. This allows for more flexibility in changing targets in a fast growing business.

In conclusion, starting a business is probably the most rewarding thing you can do in your life.

Tristram Mayhew the founder and ‘Chief Gorilla’ of Go Ape, the UK’s leading forest-based adventure company talked about Gorilla marketing.

Instead of focussing on their specific activities Go Ape are branding themselves as ‘creating adventures’, and are encouraging everyone to live life more adventurously.

Gorilla marketing means turning your customers into an effective free sales force. These are his tips:
1.    Wow them with what you do.
2.    Delight them – turn complainers into ambassadors.
3.    Build a trust and charm based relationship
4.    … and they will buy more, and more often – Tristram openly admitted that many of their ideas have been borrowed from the Innocent drinks company.
5.    Innovate, validate, cultivate.

The Brand Gap: How to Bridge the Distance Between Business Strategy and Design : a Whiteboard OverviewTristram strongly recommended The Brand Gap, it is very readable and nice and short too.

They are building a loyalty base using Tribe magazine (published every 6 weeks) to reinforce brand values.

They also make use of Social Media such as encouraging customers to post videos on YouTube, and have nearly 5,000 to date with hundreds of thousands of views.

By ‘making friends’ with existing adventure bloggers and giving them free Go Ape experiences they hope to generate positive reports online.

‘Doing good things.’ For example to help support gorillas in Rwanda 25 staff and 85 customers completed a fun run dressed as gorillas.

Will King is the ‘King of Shaves’, creator of the cult shaving brand that has overtaken Wilkinson Sword and Nivea to become number two to Gillette in the UK shaving market.

After 16 years of building the brand Will launched his own razor the Azor one year ago almost to the day. They already have up to 10% market share in the UK.

Lessons learnt:

The Harvard rule of 4
1.    No one has it
2.    Every one will have it
3.    Price for profit
4.    Price for sale

AzoriPhoneEdge.jpgTake an existing product and make it better – eg iPhone, Innocent smoothies.

Change constantly, push boundaries – it also helps to generates news stories for PR coverage.

Will introduced his SPACE strategy, which stands for Satisfaction of Success, Passion and Persistence, Attitude of Action, Confidence and Communication and Enthusiasm and Enjoyment.

There is a great degree of satisfaction in succeeding. If you achieve great satisfaction, whatever that is, it may be having children or running a marathon, but you’ve got to work at that. There’s no substitute for hard work to get that satisfaction of success, which feeds on to the passion and persistence bit. Things don’t happen overnight, it takes years to become truly successful..

You’ve got to have a can-do attitude to get things done; if you can’t be bothered who else will? The confidence and common sense part relates to having confidence in yourself and what you’re doing but not being delusional; if you try to take on Apple with an iPhone it’s a big ask, but if you want to come up with a cover to protect the iPhone clearly that’s something you could do.

There’s a certain amount when you’ve got to have confidence beyond the success that you don’t enjoy, especially when you’re starting out – people won’t give you credit, people don’t believe you’re going to do it, people think you’ll go bust, you’ll owe them money, and you’ve got to imbue them with confidence if you’re going to be successful.

And finally the enthusiasm and enjoyment piece; if you’re not enjoying it then nobody else is, especially if you’re leading a business. So have enthusiasm, have an edge about what you’re about to do because people do look to you, especially if you’re running a business or are involved in senior management. If you can’t get them motivated by transferring your enthusiasm to them, then how are they going to transfer their enthusiasm either to the products you sell or to the services you provide? They’re not.

Many thanks for writing a blog article about Marketing Maestros!  Just a thought – if possible, would you mind adding a link to the webcasts as well?  http://www.inspiringentrepreneurswebcast.co.uk/
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Beginners Guide to Business Finance with Johnny Martin

JohnnyMartin_logo

From time to time I take time out to attend one of our partners workshops. This enables me to recommend them to clients and visitors to the Business & IP Centre from personal experience and hopefully to learn something new and useful.

I have been aware of my lack of understanding of business accounts (despite having spent 16 years working for an investment company in the City of London). So although familiar with the terms gross and net profit, cash versus accruals, assets versus liabilities and not forgetting the many and varied ratios such as: Liquidity, Asset turnover, Financial leverage and of course Profitability, I wasn’t confident about what they actually meant.

If you had watched the semi-final of the latest BBC Apprentice series, you would have seen the eventual winner get in something of a muddle about the difference between net and gross profit for the business she had been successfully running for six years.

Now, thanks to attending our Beginners Guide to Business Finance course run by Johnny Martin I am feeling much more confident about how to create a set of management accounts (both for before and after a business starts). And I am now more familiar with these important business concepts. I particularly liked the way he used live spreadsheets to show the impact of a change in price or order volume on the profit (or loss) for the year.

My favourite quote from Johnny after explaining the roles of various accounting jobs from Book keeper to Financial Director was, ‘you can delegate but DON’T abdicate’, financial responsibility for your business. The experiences of both Elton John and Leonard Cohen are salutary reminders of this point.

The courses cost just £18 and are run at regular intervals here in the British Library.

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A role model for sustainable business

As mentioned in a previous post, more and more new business are setting up with various shades of green when it comes to their impact on the environment.

However the real challenge, and the real scope and need for change, is with existing traditional firms. For example carpet tile manufacturing. Well, having just watched an inspiring TED (Technology, Entertainment, Design) video, I think I may have seen the answer. Ray Anderson the CEO of global carpet company Interface outlines his vision for sustainable commerce, with their Mission Zero commitment to eliminate any negative impact Interface has on the environment by 2020.

He shows how they have increased sales and doubled profits while turning the traditional “take / make / waste” industrial system on its head.

Not only are they acting as a role model by proving how this can be done successfully, they are helping other corporates by developing a business model for them to follow.

The Interface model for sustainable business has emerged, one that guides our journey and from which other businesses can draw inspiration and design their own journeys. As we put the model to work within Interface, we set forth our vision and, imagining all it would take to realize it, developed the Seven Fronts™. We then put in place measurements, called Ecometrics™, to monitor our progress and keep us on our journey’s path. Learn more about the 7 Fronts of Sustainability.

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How good is your Escalator Pitch?

I often ask my business advice clients if they have an elevator pitch. Quite a few have not heard this expression before which surprises me.

The basic idea is that in the fortunate event you find yourself in a lift with a potential backer for your business (think Richard Branson), could you convey the essentials of your idea or invention before he got out on the 20th floor?

In practice this means between 30 seconds and two minutes to express all the salient (selling) points without any waffle, which for some of my clients is a challenge to say the least.

To see examples of this in an even more demanding environment head over to Techfluff.tv to watch one of their many escalator pitches. Just be aware that practicing this on the London Underground might get you arrested.

DEMOgodAnother inspiring place to visit for when you get a little bit longer to get your idea across (in this case 6 minutes), is Demo.com. In particular have a look at some of the Demo Gods in action to see how it should be done by the best of the best.

About DEMO
The feel you get when you enter the ballroom at DEMO is unlike any other conference. Each company is given just six minutes on the DEMO stage to truly demonstrate how their product will change the world. No PowerPoint or flashy corporate presentations allowed. Just the founders and the technologies many are staking their careers on… it doesn’t get any more straightforward and fast paced than that.