Exit Stage Left

If you think an exit strategy is only something you need when you get on an airplane, you may need to revisit your business plan.  An exit strategy can help you when you are planning to start your business, and is something that investors will ask about. Knowing how you want your business to eventually end up will help you immensely when starting up or preparing your business goals and benchmarks.

Exit strategies may include selling your business, paying your investors back, retiring, acquisition by a larger company or the elusive IPO (Initial Public Offering).  I say elusive because according to a recent article, Exit Strategies for Your Business, by Stever Robbins, there are only 7,000 public companies in the U.S. amid millions of companies, so your chances of great fortune are better playing the lottery.  The author goes on to say, “But if you’re a bootstrapper, believing in a fair IPO is a touchingly naïve act of faith. Besides, do you have any idea what’s actually involved in an IPO?” (Entrepreneur).

Here’s another great blog post I ran across:  Strategic business transitions keep communities vibrant.  This article talks about the importance of planning in farms and rural businesses, but the same lessons apply to entrepreneurs and family owned businesses.  Exit plans can also be extremely helpful for family-owned businesses and entrepreneurs.  I’ve heard stories of the patriarch passing away and then the heirs can’t get along and the business ends up failing, or one offspring wants to run the company a different way than his or her sibling(s) and it ends up destroying not only the company but the family.  With the aging workforce, this becomes even more important to get things in place.

Finally, here’s another link with a step-by-step list to plan your exit. Whether it’s business, succession, strategic or exit, there are also plenty of free resources on this topic and other business resources available online at SCORE and the SBA.

Apples to Apples

Apple growers in the Yakima Valley ship a million apples every week – a million!  The apple industry contributes over $10 million to our local economy, yet only 2% of the apples grown here are eaten in Washington State.  As I was learning more at a recent economic development symposium, it struck me that entrepreneurs can learn many lessons from the apple industry (and farmers and agriculture as a whole, but that’s enough for a whole book).

One of the most important takeaways about the apple industry was the need for diversification to stay competitive.  Remember Red Delicious?  I remember growing up, there were Red and Yellow Delicious, or Granny Smiths.  There wasn’t anywhere close to the varieties there are now, even compared to five years ago.  Now we’ve got Gala, Fuji, Jonagold, Pink Lady and even more new species coming out now. Today’s consumers want a a wide variety of choices and they want it all available in real time.  Who wants to pre-order Galas at the supermarket?

There is so much that the agriculture industry and farmers have done to stay innovative over the year that is driven by market demand and competition.  As an entrepreneur, you need to be proactive and try to anticipate what your customer needs, before he/she even realizes the need.  It comes down to innovation and sustainability.  Just think over the years about products that are obsolete but the companies have diversified product lines to meet customer demand.  KitchenAid has evolved from mixers into a whole line of kitchen products and gadgets, Hallmark has had to diversify to remain competitive with the onset of do-it-yourself cards or cheaper online alternatives and Apple (the other Apple) Computer is constantly rolling out new, innovative products.

How do you stay ahead of the market?  What type of data do you collect from your customers or how do you anticipate demand?

Lessons from Silicorn Valley

Yes, that is correct.  SiliCORN Valley.  Otherwise known as Fairfield, Iowa, a town of nearly 10,000 that is becoming well known as the ‘Entrepreneurial Capital of Iowa‘.  This town has had over 4,000 jobs created and has attracted over $280 million in venture capital investment over the past 20 years.  Per capita income has TRIPLED in the same time frame and at the same time, Fairfield ranks 5th in the nation for philanthropic giving.  Essentially, they have turned the town into a giant incubator for entrepreneurs.

We have been putting a lot of emphasis on entrepreneurship over the past two years for exactly these reasons.  We want to encourage entrepreneurs to grow their business ventures in Yakima County and remain here as well.  Strengthening the support network for entrepreneurs is also a key factor to our Valley’s Entrepreneur Network.  Part of the success of Fairfield is due to networking, mentoring, and growing companies that are out of the ‘start-up’ phase.  We will continue efforts in these three areas to help ‘grow our own’ entrepreneurs in our area.

We are on the right track.  We have put numerous resources and effort into expanding our Entrepreneur Network.  There are tons of links on our website to business plan assistance, online training, financing your business and more.  Our local SCORE Chapter is also actively seeking new members that are willing to mentor up-and-coming entrepreneurs.  There are also many local resources to help small businesses whether it is the SCORE Chapter, your local Chambers of Commerce, the Small Business Development Center and Rural Community Development Resources.  Give me a call or email me if I can help match you up with a resource to fit your needs.

SMART Goals = SMART Plans

I just saw a reference to SMART Goals:  SMART refers to Specific, Measurable, Attainable, Realistic and Timely.  These goals are excellent guidelines for not only goal-planning, but for entrepreneurs and small business owners and especially if you are preparing a business plan.   If you are defining your business, product or service, you need to be specific, know what you are selling and more importantly, who your target market is, and how often they will buy it.  A business plan can help you define your product, market, financial projections, team and business goals.

If you still don’t think you need a business plan, maybe this will convince you… According to a recent study, “those who finished their business plans were about twice as likely to successfully grow their business, get investment, or land a loan than those who didn’t” (Palo Alto Software). Read the full article.  Two times more likely to be successful??? That seems like a pretty good payoff for the investment of time and effort that goes into preparing a business plan.

I’ve had numerous calls from people wanting to start a business who are going to ‘sell everything to everyone’.  That’s a great ambition, but if I were a bank loan officer, I’d be asking for something a little more measurable, like how are you going to really make money?  The general rule for explaining your business is to be able to clearly define what you do in two sentences or less.

There are TONS of free business planning resources out there, and we are fortunate in Yakima County to have local mentors that will work with you on developing a business plan.  Visit our Business Plan Assistance page to get started today!

Need cash for your start-up?

How does $10,000 sound?  Who couldn’t use some cash to get your business started?  We are putting the finishing touches on the plans for the First Annual Enterprise Challenge, to begin in September.  The Enterprise Challenge is an interactive business plan competition to identify and reward the best & brightest new innovative business ideas and solid business plans.  It will run until December when winners are announced and cash prizes – top prize is $10,000! – are awarded.

The contest will kick off on September 15th with an ‘MBA In A Day’ workshop.  The workshop will be held from 10:00 a.m. to 2:00 p.m. and will include sessions on legal and intellectual property issues, accounting basics for business, marketing and entrepreneurship and will include an informative luncheon featuring Rebecca Lovell, Director of the Northwest Entrepreneur Network.  Registrations will begin in August for this workshop so stay tuned for more details.

If you are thinking about starting a business or have a new business, this could be a great opportunity for you.  Not only will developing a business plan help solidify your plans and projections, but the chance to win $10,000 and learn something along the way is invaluable.  Good business plans are not filed on a shelf; they should be utilized as a working document for your strategic plans, cash flows and goals.

If you are reading this now and thinking about competing, you’ve already got a head start against your competition! Contact me, Tammy Everts, Business Development Director, 509-575-1140 or tammy@ycda.com for more information!?

Not ready to quit your day job?

A lot of entrepreneurs have started new business ventures on the side.  Here’s a great article on a working ‘inventor’ mom who built a million-dollar side business, and she’s still working at her day job (seriously, who has time?).  She gives some great advice including the importance of connecting with other inventor moms, doing market research, hiring a good lawyer and being persistent.

In working with inventors and entrepreneurs, I can’t agree more with her comments.  You need to develop a support network and a team of people you can rely on to give you honest feedback, and if you have an invention, it’s probably going to be worth your time and money to invest in a good patent attorney.  I also liked how she told herself she was going to search for a similar product before she invested a lot of time and money into developing hers, and if she couldn’t find one better, then she would pursue it.  One lesson I’ve learned recently is that, chances are, if you have a great idea, someone else has too.  Unless you can make the cause that yours is significantly better or dramatically different, it had better be a lot cheaper.

Thinking about starting a business?

If you want to start your own business, you probably have some homework to do before you get started.  Find out what you need to do with a short workshop on Tuesday, May 18th from 11:30 to 1:00 p.m.  This class is perfect for you if you want to start a business, but are not sure where to start.  It includes the basic elements you need to know, what goes into a business plan, and also includes a brief self-assessment to evaluate your readiness for starting a business.

This is the first workshop in the Yakima Valley Entrepreneur Network’s ‘Working Lunch Series’, presented in partnership with SCORE.   Attend one or all of the sessions to learn what you need to get started.  Workshops are taught by professionals with real-world business experience.

• Thinking about starting a business?  Tuesday, May 18, 2010.  11:30 a.m. to 1:00 p.m.
• Business Plan Basics, Tuesday, June 1, 2010.  11:30 a.m. to 1:00 p.m.
• Financing your Business, Tuesday, June 15, 2010.  11:30 a.m. to 1:00 p.m.
• Marketing your Business, Tuesday, June 29, 2010.  11:30 a.m. to 1:00 p.m.

Held at the Central Washington Business Resource Center, 10 North 9th Street, Yakima 98901.  Classes are $10.00 each if you pre-register or $15.00 at the door and includes the price of lunch.

To register or for more information, call Tammy Everts, Business Development Director at 509.575.1140 or email tammy@ycda.com.

Great idea…but why should I care?

You may have the greatest idea in the world, but can you convince your customers why they should care about it?  What makes it SO unique and different that they will choose it over your competition?  These questions should be continually top-of-mind if you are pursuing a new business, idea or product.  We recently held an in-depth training workshop for entrepreneurs  and inventors on how to refine their ideas and products and to examine what the value is or why people should care.  The workshop utilizes a training program called Eureka Winning Ways, developed by entrepreneur Doug Hall.

The biggest take-away I got was, “why should I care”?   Whether it’s from a customer, investor or employee, you need to be able to answer this in a clear, precise way.  (Hall recommends two sentences or less.)  Other potential questions you should be prepared to address are, “What is so much better that I would want to buy, use or invest in it, compared to the competition?  What if it costs more, how are you going to convince buyers that it’s so much more superior?  What’s in it for me, the customer?”

Think in terms of real value or why it would be important to a client or customer, for example, it saves time, money, does something better than anything out there.  Just saying it’s cheaper than the competition isn’t necessarily going to change someone’s mind.  But, if it’s cheaper and works better in half the time, now you’ve got my attention.

Here’s an excellent blog from this week’s online Harvard Business Review; the headline mentions ‘trust and customers’ but it’s really about how businesses such as Amazon and Zappos have differentiated themselves from others, gained customers and earned that trust.  What other things make your favorite business or product stand apart from the competition?

What’s better than sliced bread?

Maybe it’s time to upgrade this saying; I’m not sure that sliced bread is the best-invention-ever anymore.  Do you have the next big invention or idea?  Want to see if it’s worthwhile to try and market?  Or perhaps you want to explore better ways of reaching your market and commercializing your product or service.  Register now for Profit 101:Commercializing Great Ideas – a half-day seminar focused on generating or refining innovations, products or services.  The workshop is part of New Vision’s Technology Roadmap initiative (TRI), to help inventors, entrepreneurs and established businesses commercialize bright ideas.

The Roadmap is designed to help inventors, entrepreneurs and established businesses get their bright  ideas, new product lines and inventions in the ‘fast lane’ to commercialization.  We are working with Impact Washington to help people evaluate and commercialize their bright ideas.  The first part of this initiative is for everyone that is interested in launching their inventions or product ideas – Yakima County inventors and entrepreneurs with innovative new products or inventions that are close to market-ready or past the ‘idea’ stage and existing businesses that want to expand or diversify products or areas.  We will then take applications from interested parties and a panel of judges will select up to five individuals or teams for in-depth assistance.

Profit 101:Commercializing Great Ideas will be held on Wednesday, April 28th from 8:00 a.m. to 1:00 p.m.  Cost is $30, which includes lunch.  Registration deadline is this FRIDAY, APRIL 23rd!

Contact Tammy Everts, Business Development Director, 509-575-1140 or tammy@ycda.com for more information!

Help us find Entrepreneurs & Inventors

We are looking for entrepreneurs, inventors or folks who have great ideas, inventions or products but may need some assistance.  Our Technology Roadmap Initiative is designed to help innovative people learn how to evaluate and commercialize their ideas, new product lines and inventions.  Participants in the Technology Roadmap Initiative can win a $2,000 Eureka Ranch Merwyn Assessment to evaluate their ideas and determine how they can commercialize potential products or ideas.   The Merwyn Simulation is one of the nation’s best systems for gauging the success of ideas or new products!

Existing businesses that want to improve, expand or diversify product lines or services can also participate in the Technology Roadmap Initiative.

$30 entrance fee includes registration at two upcoming business seminars: Entrepreneurship 101 and Commercializing Great Ideas (Profit 101).  For more info on these seminars or to register click here.

Technology Roadmap Initiative participants wanting to be considered for the Merwyn Assessment must return our full applications by May 3, 2010.  Click here for applications and more information.

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