We have added new events to the calendar in July. Use the extra hours of light to network, and focus your energy on important entrepreneurship skills:

Market Research eIQ Session
Tuesday, July 7, offered twice 1:00 – 3:00 pm or 3:30 – 5:30 pm, NWEN Offices, Bellevue
Entrepreneurs need to know more about their prospective customers and markets, but perceptions or lack of knowledge sometimes gets in the way. “Market research is an expensive isn’t it?” “How much can I do myself?” How do I make sure the research gives me the answers I need?” Join Mike Pritchard as he shares cost effective tips for success.
Cost: $34 for members, $49 for non-members
Register for the 1:00-3:00 Session
Register for the 3:30-5:30 Session

Venture Breakfast: Meteor Technologies: A Love Story
Friday, July 10, 7 – 9 am, early bird networking starts at 6:30, Harbor Club, Bellevue
In a tale of two companies (and a venture capitalist), boy starts company, company goes to market, company meets venture capitalist, two companies meet, and live happily ever after. Though the story of Meteor Technologies isn’t nearly this simple, it is a Reese’s Peanut Butter Cup-style phenomenon where the whole is greater than the sum of the parts. Join us as Pete Parsons (founder of Fyreball) and Ben Straley (founder of Reach Machines) share some lessons learned from the market, the joy of being nimble and market-sensing, and the power of relationships in the community. Whether or not you agree the subsequent creation of Meteor Technologies is a classic romance, it is a fascinating story.
Cost: $25 for members; $40 for non-members, $5 additional after July 6 (walk-ins additional $5 at door)
REGISTER

Essentials of VC Financing
Monday, July 13, 7:30 am – noon, Wilson Sonsini Goodrich & Rosati Offices, Seattle
Continuing in NWEN’s series of Essentials for Entrepreneurs, the VC Financing workshop will provide you with insight on attracting venture capital as well as what’s “market” in this economy. Understanding the vernacular of VC financing, from legal documents to negotiations, is critical for success. Join us as subject matter experts walk through real-world examples to help you embark on your funding adventure.
Cost: $65 for members, $115 for non-members
REGISTER

Pub Night – New Location for July
Wednesday, July 15, 6:00 – 8:00 pm, Del Rey, Seattle
NWEN’s pub nights have been a long-standing tradition, and a popular favorite amongst our members for the networking opportunity, great appetizers, cold drinks, and the chance for 3 minutes of fame as brave souls pitch their business to a friendly (beer-drinking) crowd. We’ve kept all these great traditions, but in July will move the party to Belltown. With free street-parking after 6, a US Bank lot just over a block away, $7 all-evening valet parking available via a neighboring restaurant, and bus routes galore, we’d love you to join us and celebrate.
Cost: $10 for members
REGISTER

Business Plan Writing Workshop
Tuesday, July 21, 3 pm - 4:30 pm or 6:30 - 8pm, NWEN Offices, Bellevue
Are you struggling with writing your business plan or executive summary? If so, you’re on the right track. It’s supposed to be hard. Let us help you to make it effective as well. Learn how to use the business plan writing process tool for critically researching, evaluating, planning, and explaining your business. NWEN’s Business Plan Writing Workshop provides an overview of many of the critical questions that every entrepreneur needs to consider in the early stages of the company’s life. This popular session is led by Bryan Brewer of Business Plans Northwest.
Cost: FREE for members; $49 for non-members
Register for Afternoon Session
Register for Evening Session

Think Like An Investor eIQ Session
Wednesday, July 29, 3:30 - 5:30pm, NWEN Offices, Bellevue
If you’re seeking outside capital for your startup, you need to think like an investor when putting together your pitch. Investors seek to maximize opportunity and minimize risk; get inside their heads and anticipate their questions. This interactive session is peppered with real world examples and led by Rebecca Lovell, NWEN’s executive director.
Cost: $34 for members; $49 for non-members
REGISTER

About a year ago, I didn’t care or desire to be on facebook and until recently not many of my peers were on facebook. Now, it seems everyone is on it. If you are looking for a friend on facebook, just friend me. It is pretty impressive to see a company grow from 0 to 175M registered users in a matter of 5 years and these users are spending an incredible amount of time on the site every month. This leads to a tremendous opportunity for advertisers and entrepreneurs. I admit I haven’t figured facebook advertising out yet, but given the sheer numbers on facebook, it’s only a matter of time before facebook starts becoming extremely profitable. So, for us entrepreneurs, it’s time to start playing the game early before the all the other advertisers arrive.

One of my good pals, DK has a great post on facebook advertising. If you’ve done some facebook advertising with success, please share in the comments below about how you’re thinking about advertising on facebook and what’s worked well. I’m going to share some of the things we’re going to consider trying on facebook. I’m very excited to try this out.

1. Test slowly on a small targeted group. I’m most likely going to target the younger demographic 15-34 since we’re running an entertainment site. Find your group, target age, gender, and location if you need to. Start a campaign on that small group.

2. Measure and Optimize. Watch your results closely and see if you’re driving good, converting traffic. If not, focus on ad copy and your site to make sure it’s converting. CPC’s on facebook are generally cheaper than Google, so you may find some great opportunities to pick up traffic.

3. Consider using CPC as a branding exercise. If you are paying for CPC and you’re getting 0.5% clickthrough, wouldn’t it be great that you would be also getting brand exposure on the other 99.5% of people who don’t clickthrough? Make sure your brand is front and center and that you are doing things that are relevant for the end user.

4. Consider the social impact/virality of ads. If you create a successful campaign, it will get pushed through facebook very quickly with people sharing and talking about your company/product. Find ways to provide value to the end-user and make it easy for them to share your story.

There’s a ton of opportunity right now especially with advertisers staying on the sidelines to be able to purchase advertising much cheaper than in the future which means you can build a business a lot faster now. Facebook is just one of many channels that are going to be huge for driving unique, valuable customers to us. If you figure it out soon, you’ll have a definitive advantage over those who arrive to the party late.

Good luck!

This post was written by Andy Liu, a serial entrepreneur and angel investor. Andy currently runs BuddyTV, sits on several boards, and blogs at InspiredStartup about staring and growing successful businesses.

If you’re like me, you have a burning desire to be awesome at Photoshop. It seems so easy, so within reach. Maybe you’ve learned a few tricks like making gradient backgrounds for website titles. Ooooh, it looks 3D! Look out Pixar!

But then you come to some bitter realizations:

• I’m spending way too much time on this.
• None of this is making my website truly awesome.
• Design doesn’t come from Photoshop filters; there’s color palette, page layout, consistency, compatibility with messaging, not to mention fonts other than Myriad Pro.

Making your website or blog or software gorgeous means finding a great designer. And since you probably don’t have enough work to hire an in-house designer, you need to find a freelancer.

Well, you’re in luck. Here’s how to get freelance design work and how to make sure you don’t spend more money than necessary.

1.  Bid out small jobs on-line

The first rule of hiring a consultant is: Maybe you don’t need to hire one!

If you’re in the market for small jobs, your best bet is a marketing auction site like 99designs or CrowdSpring, or a professional database like GraphicRiver, or a site with both like DesignBay.

To describe how it works, let’s assume you want a logo.  You start by describing the project: “Design a logo for Xyz.”  (That was easy.)

Next you give parameters and conditions.  Specify your company’s color scheme (two or three colors; if you suck at colors just steal borrow a nice set from Adobe’s on-line archive.  Logos need to look good both large (for T-shirts, posters, and tradeshow banners) and small (for business cards and corners of websites), even if that means having different but very similar logos for different sizes.  It’s often a good idea to require that the logo makes sense in black-and-white, or that it’s still legible even if the viewer is red-green color blind.

Finally you specify the amount of money you’re willing to spend. Often $150 for a logo is enough.  Why so low? Because a lot of designers are just getting started and need to win jobs to build a portfolio. Also because designers do this on the side for a little extra income, or are willing to take cheap jobs to get through the recession. Or because the designer lives in a country with a lower cost of living.

I know several people who have had great logos designed in three days for under $150. If you’re looking to develop your personal or corporate image, surely that investment of time and money is worth it!

But many jobs are too complex or too important for a one-off cheapo solution. Besides, there’s a good argument to be made that these design-on-spec sites are morally gray.

In that case you need to hire an expert.

2.  How to look for freelance designer

You couldn’t have picked a better time to hire a freelancer! The recession has created a buyer’s market for any sort of consultant. Take advantage of this time to find a terrific person at a bargain.

Start with your network (friends, Facebook, LinkedIn); recommendations are almost always better than nothing.

Be careful though — if the recommendation is for “a friend” or anyone with a familial relationship (”Oh yeah, my brother-in-law is looking for work), be very very cautious! First, this implies the recommendation is a favor rather than a vote of confidence for the work. Second, and more importantly, it will be hard to have a professional relationship. If you have to put your foot down or even fire them, suddenly it’s personal. Not worth it!

Your alternatives include Craig’s List, general Internet searches in your area, or web sites like Elance that connect you with freelancers; all these methods can create an avalanche of candidates you’ll have to sift through. That means you’ll have to be rigorous with your vetting process, described next.

3.  How to choose which designer to hire

So now you’ve amassed a few candidates.  (Yes “a few,” you’re not going to consider just one!)  How do you choose?

The most important qualification is whether you like their prior work. I cannot stress this enough: Designers don’t morph their style to match yours; they don’t deviate from their own style.

If they make slick, glossy, mocha-latte-modern-glassy stuff, you’d better like that. If they make crunchy, green, friendly, round-rectangle stuff, you’d better like that. Scan their portfolio and make sure you like what you see, as-is. If you run across something and think, “Ooh, this would be perrrrfect if they just copied this exactly for me,” that’s a great sign. If you go through fifteen pages of their portfolio and nothing makes your heart leap, it’s a “pass.”

I know, many designers will tell you otherwise, and I’m sure there’ll be thirty comments calmly and artfully ripping me a new one over this. (And please do! Our dear readers need to hear the other side of the story.) But in my experience a style mismatch is a non-starter.

The next thing you do is call their references. But don’t get excited when their references are positive. Of course they are — otherwise they wouldn’t be listed as references!

Instead, you’re looking for glowing, over-the-top recommendations. You’re looking for things like “Yeah we hired her once and we’ve been coming back for years.” Or “I actually hate to tell you how awesome she is because it might mean we get less time.”

A key question you should ask is: “Did the designer deliver on time and on budget?” These constraints are important and separates the artists from the artists-who-treat-this-as-a-business. You need the latter.  (Thanks to Kathy from Virtual Impax for this suggestion!)

A trick is to request a reference for a particular portfolio piece that you like. Don’t ask for the references they want to give — surprise them.  Expect that they need to ask permission before giving out contact information.

4.  What to ask for in the contract

You have to get a few things in writing so there’s no mistake when it comes time to trade final product for a check.

• You are the sole owner of all works made for hire. The consultant retains no copyright. You need this to ensure uniqueness — that the designer cannot just duplicate work done for you and use it elsewhere. You also need it for control; when I sold my company we had to get special releases from all our freelance designers explicitly stating that we owned the intellectual property.

  It is appropriate (and recommended) to allow the designer to use all materials in their own portfolio; just make it clear that this isn’t joint copyright, but rather a free license you grant them for the purpose of promoting themselves.

• You get the electronic source files of all works, both finals and drafts. This is essential so that you can make small changes yourself or switch to a different designer.
• Expenses besides the hourly rate must be approved first. I’ve been bitten by designers who run off and order products we don’t need or make expensive color glossy print-outs of things we’d rather see on a computer screen.

A final note on contracts, though — don’t sweat all the little details. Contracts only matter if there’s a dispute so severe and irresolvable that it comes down to lawyers. In that case it will be far cheaper to just walk away from the situation, even if that means paying the full amount.

5.  How to approach and structure the new relationship

So you’ve selected a designer and you’re ready to start. You don’t know each other yet, so neither one of you knows how to work together.

You’re going to want things like estimates and clear statements of work but the designer doesn’t know how many times you’re going to change your mind, how many iterations it will take, or whether you’re going to blow up her cell-phone at 9pm on a Saturday night.

The designer will want things like a clear direction and approvals for color palettes and design concepts, but you’ll be unsure of yourself, unsure how much to trust the designer’s instinct when it conflicts with your own, and unable to find the words to express your muddy vision.

Addressing these unknowns is easy — just be honest about them from the start and make it clear that you appreciate the designer’s dilemma as well. Talk! Notice when you’re hitting a barrier that might be your own fault.

Take a “baby-steps” approach to the design work. Instead of making a grand plan for redesigning everything, start with the basics. For example, try just the color scheme and logo as described above. This gives both of you a chance to learn how to work together.

Besides, getting the basics totally finished and approved makes it much easier to see how the rest falls into place. Once your colors, attitude, and style are embodied in something as iconic as a logo, the path to websites, white papers, blogs, and tradeshow banners becomes an extension of an idea rather than a new project.

Finally, “baby-steps” means you can spend just as much as you want. If you end up not liking each other or it’s too expensive, you can stop and still have something to show for it. And since you have originals, maybe you can take a crack at the rest yourself.

6.  It’s worth it

Yes, it really is worth all the effort. Your image matters. First impressions matter. Colors and layout and fonts set the tone before a person reads a single word.

In this ever more cluttered Internet, it’s even more important to stand out.

Plus, looking good just feels good. Now I know how Brad Pitt feels. (Yeah right!)

Jason Cohen wrote this post and allowed us to syndicate it. He is the founder of Smart Bear Software, maker of Code Collaborator, the world’s most popular tool for peer code review and recent winner of the Jolt Award.

Do you ever feel like you’re going insane? Do you do the same things over and over again expecting a different result? Is your business becoming more and more like Groundhog’s day? That’s the real definition of insanity. How do you avoid going insane? Here are some of my free-wheeling thoughts.

1. Understand your motivation. What is driving you to do what you do each and every day? Are you someone who always seeks comfort and predictability? Do you value work/life balance? If you don’t know why you are going to work each day, you’ll be doing the same things over and over again with the same results. By understanding your motivation, you’ll have a clear idea of what you need to change in order to generate real results. For example, I’m motivated by competition and playing the game right, I enjoy winning which drives me to constantly evaluate strategy and execution. At times though, I’ll get in a rut and realize that I’m not driven by winning, rather I’m driven by “playing not to lose” - which in my mind is the dumbest way to play. For me, understanding which way I’m playing helps me stay focused on results.

2. Challenge yourself everyday with something uncomfortable. Now, not for the sake of doing so, but because you are doing something valuable for your company. For example, if you don’t write well, write a blog post for your company today. If you don’t know how to cold call, do it - call three potential clients today. If you don’t enjoy networking, invite a potential mentor to lunch today. The more you are challenged with new things each day, the more you’ll be able to see opportunities that will open doors for you.

3. Take responsibility. Honestly, I’m sick and tired of hearing entrepreneurs complain about the economy instead of taking responsibility for the decisions they are making. Everyone is in the same boat, the great entrepreneurs are the ones that are able to adapt, make decisions given incomplete information, and take responsibility for their own decisions. Blaming the economy is an easy way to continue doing the same things and avoiding the tough decisions that need to be made in this environment. Another thing that drives me absolutely nuts are companies that survive by leeching off of others, in other words, building a business around suing other businesses and people instead of building real businesses or competing. Build value, take responsibility, and stop the nonsense of detracting value.

The past Bush administration post 9/11 asked all Americans to step it up and spend to keep our economy growing. The biggest insanity in the US is that we think spending and debt will bring about a sustainable economy. Time and time again, it’s been proven that spending and debt both personally and as a country is unsustainable. We tend to spend on assets that decline in value, automobiles, Ipods, Iphones, TV’s, overpriced homes, etc. What we need is to have a healthy mix of saving and investing in assets that provide a return. It means that we must do things differently, we must live below our means (both personally and collectively), we must invest wisely, and we must save more. It’ll mean more short-term pain, but in the long-term it’s sustainable and bubbles of the past may be minimized in the future.

This post was written by Andy Liu, a serial entrepreneur and angel investor. Andy currently runs BuddyTV, sits on several boards, and blogs at InspiredStartup about staring and growing successful businesses.

Zappos COO Alfred Lin enlightens us on how to become 37 times more productive in only one year! Can it be? Let’s hear him out:

Make at least one improvement [every day] that makes Zappos better. It sounds daunting, but remember improvements don’t have to be dramatic. Think about what it means to improve just 1% per day and build upon that every single day. Doing so has a dramatic effect and will make us 37x better, not 365% (3.65x) better at the end of the year. Wake up every day and ask yourself not only what is the 1% improvement I can change to make Zappos better, but also what is the 1% improvement I can change to make myself better personally and professionally — because we, Zappos, can’t grow unless we as individual people grow too.

Imagine yourself making 1% changes every day that compounds and will make you and Zappos 37x better by the end of the year. Imagine if every employee at Zappos was doing the same. Imagine how much better you, Zappos and the world will be next year.

At first glance it’s inspiring.  At second glace it’s poppycock. At third glance you wonder how it’s possible for someone to use the word “Zappos” so frequently.

Being 37x more productive is impossible, and I’ll show you why. But along the way it will become clear how becoming 2-3x more productive might be within reach.

His math isn’t the problem per se. It’s true that if you improve 1% each day over the previous day, that’s a 1% compounding rate. My question is: Is it possible to increase your daily productivity by an entire percent every day?

To answer that, I want to give you a fun math puzzle. Yeah, I know, “fun” is relative… Okay look if you don’t like word problems just take a random guess at the answer. If you’re up for the challenge, try to solve it without pen and paper. You know, just to prove your MIT education wasn’t for nothing.

Here’s the puzzle: You get in your car at home and head out towards your mother’s house 60 miles away. (Your mom likes this word problem, I can already tell.) You hit traffic during the first half of the trip, so after 30 miles you’ve averaged only 30 miles per hour.

Now the traffic opens up and you can go as fast as you want. The question is: How fast do you have to go during the second half of the trip such that you’ve averaged 60 mph over the entire trip?

If you’re not using pen and paper, maybe you guessed 90? 120?

Actually it’s impossible! To average 60 mph you need to travel the whole 60 miles in a single hour. But it’s already been an hour!  Even if you went 1000 mph during the second half, it would have taken just over an hour to complete the 60 miles, therefore your average is still less than 60 mph.

It’s amazing how periods of low velocity wash away gains of high velocity. In the puzzle, if you doubled your speed in the second half it would increase your trip average from 30 to 40 mph. If you quadrupled your speed in the second half, your trip average would still be only 48 mph.

Once you’re behind, you can’t make up ground no matter how fast you go.

This puzzle illustrates the weird math of velocities, and what applies to “miles” per hour also applies to emails per hour or writing code or writing prose or any other “gettin’ stuff done” per hour.

The problem with improving your productivity is that so much of your day is occupied by low-velocity activity — dealing with emails you didn’t really need to see, dawdling in a meeting that hasn’t started yet, or spending too much time reading blogs. (Present company excepted.)

When half your day moves at 30 mph, it’s impossible to make up the time during the other half.

This is the problem with Lin’s 1% idea — the low-velocity stuff makes it too difficult to improve even 1% overall, at least not every day of the year. Even with 37x improvement in some areas, you still might not be 2x more productive overall.

There’s good news here, however! Once you realize that the low-velocity stuff is responsible for most of the drag on your productivity, you realize that the thing to do is eliminate the low-velocity stuff. Yes it’s good to learn to type faster, but cutting down on the time it takes to process useless email might help even more.

Ready for more good news? There are free tools that help you identify what the low-velocity stuff is. I use one called RescueTime. To show you how useful this is, consider this example of my stats for one week:

Whoa — almost eight hours of email.  That’s a solid, uninterrupted, full day of nothing but email I’m blowing through every week. Is that really the way I should be spending the majority of my time?

Even the long tail can be instructive. Notice the 45 minutes of “Calendars.” A drill-down bears out the awful conclusion — yes I spent almost an hour in Google Calendar.  It’s true this week was completely packed with events, but still.

Another realization: I had an averaged 5.5 hours of activity per day.  I was in the office for over 8 hours every one of those days — the rest is sopped up with meetings, office chatter, and lunch.  Here’s the mythical eight-hour workday quantified — I’m starting with 5-6 and even then I spent much of it fielding email.

Once you see the numbers it’s easy to correct. I now notice more when I’m in an office conversation that’s past the point of being productive. There’s millions of tips for how to process email more efficiently.

So if you’re serious about wanting to increase productivity by, say, 2x, you can. Identify the biggest perpetrators of low-velocity activity and eliminate them, then do a little surgery on your high-value tasks.

The best part is, none of this means working late or working harder. Just stop averaging down!

Jason Cohen wrote this post and allowed us to syndicate it. He is the founder of Smart Bear Software, maker of Code Collaborator, the world’s most popular tool for peer code review and recent winner of the Jolt Award.

I play poker occasionally and the achilles heel of many poker players is that they think they are better than they really are. They’ll play in tough games where they’ll lose in the long run. The players that honestly assess how poorly they play will avoid situations where they are bound to lose and play games that their skill level will excel at. I’m not a great poker player, but generally I can assess pretty darn quickly if I’m the sucker at the table and admit it. (Stop playing those A9s, it’ll kill your bankroll

The same applies to your personal review.

If you aren’t accurately assessing your core strengths and weaknesses with a very critical eye, you’ll get beat. You’ll be overmatched and worse yet, set the company off on the wrong course. Do the tough thing and ask your staff to be critical of you and rate you without repercussions. If you don’t have staff, ask your advisers, your customers, or anyone you think can give you a real 360 degree view of you. Do your own self assessment of what you did well, what you did poorly in the past year and give yourself a rating. Do it in writing. Do it honestly and be hard on yourself. Would you fire yourself? File it like you would for any other employee to review every month or quarter.

It doesn’t do any good to stop after doing your review. You need to also come up with an action plan. Never stop learning or growing every day. What are you going to do to improve on your strengths? What are you going to do to cover/improve your weaknesses? Should you hire someone better than you or offload the responsibilities to current staff?

Once you have your action plan, who is going to keep you accountable? Meet with them once a month or even more often. Don’t do it yourself, it’s just too hard.

If you’re like me, life is much more interesting and fun when we’re honest with ourselves and we’re constantly improving.

This post was written by Andy Liu, a serial entrepreneur and angel investor. Andy currently runs BuddyTV, sits on several boards, and blogs at InspiredStartup about staring and growing successful businesses.

You already know the elevator pitch is critical to your business, not just for pitching but to crystallize the goals of the company in your own mind.

You might also have developed a one-line positioning statement — a single sentence that defines the company in a simple, clear, sentence.  Not one you’d use on customers, but rather something to tack on your wall, something that all marketing and communication should be working towards.

The Venture Hacks blog teaches us about something even smaller and tighter — the high-concept pitch. The idea is to boil your message down to a short phrase that references existing, successful products. Examples:

• “YouTube is Flickr for video.”
• “LinkedIn is Facebook for business.”
• “Twitter is Blogger for Attention Deficit Disorder.”

I like brevity, but I don’t like the high-concept pitch. It leaves out so much it becomes ambiguous, possibly with unintended consequences.

Let’s make this concrete. Say I’ve invented a new compact, portable projector:

This projector weighs less than a pound and it’s the size of a cell phone. It uses bright LEDs so you never blow out a $100 bulb. Your sales guys don’t have to haul equipment or plug into projectors missing “yellow” that can’t run at their laptop’s resolution. This projector works 100% of the time and is small enough to get through airport security in your jacket pocket.

That’s my product pitch — contains all the details and reasons to buy it. Now for the positioning statement:

A compact, portable, rugged projector that eliminates surprise problems on the road.

Short and sweet, still including the primary features and benefits.

Now it’s time for the high-concept pitch. Here’s an idea, copied almost exactly from the Venture Hacks article:

iPhone for projectors

This sounds good at first blush. iPhones are known for being easy to use, pretty, coveted, and commercially successful. Also the analogy extends to size and portability. Good!

But these aren’t the only attributes of the iPhone. iPhones have a reputation of not working well with Microsoft Office, something particularly troubling for the travelling salesman. Readers of this blog are likely to use GMail and Open Office, but your typical salesman is on a strict diet of PowerPoint and Outlook. Just yesterday I spoke with a business traveler who has avoided the iPhone specifically because of its lack of integration with Exchange (now fixed).

iPhones are notoriously inflexible and not customizable. They bucket you in a culture. With the v2.0 software debacle, I could even include “buggy.”

When you use only three words and when you invoke something well-known and complicated, it’s not clear what message will be received. I’m brevity’s biggest fan, but there’s such a thing as “too brief.”

No, I’ll stick with Eric Sink’s definition of positioning statement as the fundamental particle in my marketing universe.

P.S. Another weird quote from that article is that “for investors, the product is nothing.” I get the point — that product != strategy, and product strategy is more interesting to investors than feature bullets. But still… “is nothing?” Perhaps intentionally exaggerated to make a point, but if you find an investor for whom this is literally true (and I have!), steer clear. Strategy with zero product understanding isn’t strategy.

P.P.S. Healthy disagreements notwithstanding, Venture Hacks is a must-read if you’re interested in funding or selling a company.

P.P.P.S. Someone should make that projector!

Jason Cohen wrote this post and allowed us to syndicate it. He is the founder of Smart Bear Software, maker of Code Collaborator, the world’s most popular tool for peer code review and recent winner of the Jolt Award.

Big picture folks - we are in a bad, vicious, negative economic cycle with no end in sight. I hate to repeat bad news, but we’re in for a much longer recessionary period than we can imagine. Even though I’m not an economist, I’ll try to highlight in this post why we’re in for a long dark period and how we’re going to get out of it (hint: it’s not the government).

We’ve gone through a tremendous period of leverage where everyone was able to get credit, this led to assets to being way overvalued (stocks, homes, businesses). This took a while and it will take a while to get out of this. The US government is also highly leveraged, the stimulus bill and new bills to be passed will add trillions to our debt. The credit markets are still badly frozen. All this on top of a recession where people are losing jobs and unable to pay mortgages, education which leads to more freezing of the credit markets. What does this mean?

Brace yourself for massive de-leveraging around the globe. It’s already happening. Less leverage and reducing leverage means asset prices come down significantly (housing, stocks, etc) and at worse, deflation starts happening. This benefits savers whose cash now reigns supreme and it goes further than ever before. However, savers are not spenders and they can’t leverage their cash either - so it stifles the economy even more. You’re already seeing the US saving more and spending less, good in principle, bad for stimulus. It’s going to be a long time before we emerge. A good baseball analogy is that we’re probably in the bottom of the 2nd inning.

So the solution is the government, right? NOT! As you already saw with the TARP (which I incorrectly supported), the money didn’t loosen up the credit markets at all. The stimulus package while nice, isn’t going to be enough to stimulate the economy. We’ve got commercial assets that are very toxic, stocks that are still overvalued, earnings that are still taking a beating. The government doesn’t have a great track record for producing great results, no disrespect to Obama. Anyone who is betting on the government to solve their problems will be sorely disappointed.

What we need is a big dose of HOPE for everyone.

Hope

Imagine if everyone lived a life full of Hope and Inspiration instead of negativity. How fast do you think we can recover as a nation, as a world? I know some of you think I’m pretty negative in this post, honestly, I’m not. My personal belief is that we’re in a cycle of negativity which is keeping everyone down and totally blind to seeing opportunities. I got to hang out with some folks at a retreat last week and everyone was seeing opportunities and going for it. Imagine if everyone was doing that, imagine if we had entrepreneurs around the world seeing opportunities and taking risks, having hope for a better future. They’d employ people, they’d focus on solving problems, they’d seek to build sustaining operations with profitable enterprises. What about social entrepreneurship?

Imagine if you could build a successful business in this environment, what your business would like when we emerge from the recession. It’s time we stop expecting the government to get out of this mess, we must have more hope and inspiration and set an example for other entrepreneurs to work hard, innovate, create, lead, and pull others up.

Isn’t it time that we lifted our eyes out of the darkness of negativity and start seeing hope and pursuing dreams today?

This post was written by Andy Liu, a serial entrepreneur and angel investor. Andy currently runs BuddyTV, sits on several boards, and blogs at InspiredStartup about staring and growing successful businesses.

What if tomorrow I forced you to double your price?

If you sell software, your prices just doubled. If you’re an hourly consultant, your rate just doubled. If you’re a salaried employee, you’re now demanding double your salary.

Ignoring the (understandable) backlash from your existing customers/employer, what would you have to do to justify the new price tag?

• If you’re selling software, would it be best to add new features, or would people perceive more value if it were beautifully designed? Does it need more functionality or fewer bugs? If a customer emails tech support, what response would impress the customer? If a customer comes to you with twenty feature requests, do they get lost in the shuffle or do you proactively contact them quarterly with updates?
• If you’re a consultant, could you command a higher rate if you got certified in some technology, or would you earn more authority writing a quality blog? Should you charge for every email or provide some advice gratis? Should you charge a low rate but milk projects for extra hours or should you be expensive but brutally honest with your time reporting? To maintain contact with your past customers, is it enough to send automated holiday e-cards or should you write a quarterly newsletter with useful tips and ideas?
• If you’re an employee, how could you make yourself indispensable? Is there a project lying around that no one else is taking the initiative on? Is there a way to save money? Is there something you could do above and beyond your job description that would undeniably improve the company?
• If you’re looking for work, should your résumé list as many technologies as possible or should you boast about your deep expertise in one area? Should you dwell on formatting or on making an impression? Should you copy the ten recommendations you have on LinkedIn or is it best to attach one passionate, glowing recommendation? Is it more impressive to list your club memberships or your Stackoverflow reputation?

Assuming this thought experiment has provoked some ideas for how you’d change your approach to business or your professional behavior…

What would happen if you acted like that without raising your price?

You’d crush your competition.  Maybe it’s the edge you need to make sales during a recession.  Or maybe you could justify raising your price!

Hold on though, isn’t it more difficult, expensive, and time-consuming to behave as if your time is twice as valuable?

Yes.

But then, behaving that way does make you twice as valuable!

Jason Cohen wrote this post and allowed us to syndicate it. He is the founder of Smart Bear Software, maker of Code Collaborator, the world’s most popular tool for peer code review and recent winner of the Jolt Award.

Great results never come easy, right?  Losing weight, running a marathon, building a successful business, having a great family life.  It takes hard work, perserverance, resiliency, focus, and a rock solid attitude.  As I’m working long hours on executing our ‘09 strategy, I always try to keep in mind that it is a marathon that we are running and not a sprint.  Building long-term value isn’t easy and it requires hard work.  I’d like to share five myths about startups that I’ve learned only after hard blood, sweat, and tears.

Myth #1: Starting a business is hard, Exiting is easy. Nothing could be further from the truth.  Starting a business is very easy.  Once you’ve started it, getting to profitability and your first $1M/year in revenue is very difficult.  I’d consider that you’ve “exited” the business if you’re capable of building a profitable business primarily because you have options - people will want to buy you, you can expand organically, and your options for raising financing is much easier.  Expect that the road is tough, give yourself at least 2 years, be realistic and give it 110%.

Myth #2: People care about your business. Sorry, folks - people couldn’t care less about your new business.  You need to earn that attention.  I’ve learned a tough lesson with this the first time I launched my web business, we may have had 6 visitors on our first day - and those were our employees and families.  The next day, everyone forgot about us.  People don’t care.  There are very few businesses that can launch with a launch party and call it a day.  You need to give them a great reason to care.  Make sure you go in with a good plan.

Myth #3: Being threatened is a bad thing. This is similar to myth #2.  If you don’t have anyone who feels threatened by your business or if you haven’t ever faced a lawsuit - I’m sorry but you don’t have the influence that people care about.  I don’t wish it on anyone, but if you haven’t ever faced a lawsuit or been threatened with a lawsuit, you probably don’t matter.  You need to keep growing and consider that your company has grown to the next level when you are threatened - you should celebrate when it first happens, it’s like riding a bike for the first time

Myth #4: Assuming you are the boss. I don’t care if you are a sole proprietor or a CEO that runs a Fortune 50 company, you are not the boss.  And, if you assume you are and act accordingly, you will not be successful.  Your boss should be your customers, your employees, your investors, your family, and your board.  I’m a big believer in servant-leadership, are you enabling your employees to succeed in their position?  Are you delighting your customers (your boss)?  Since you have the title of leader, are you running the company as the enabler/servant?  You will be much happier you did and your results will far surpass the contrary.

Myth #5: Startups are dependent on your passion. I’ve heard this advice so many times and it’s tiring.  Be passionate about what you do.  It sounds great, but I’d argue it takes much more than your passion to succeed - it takes commitment.  Rugged, almost stubborn, commitment!  Personally, I’m passionate about music and especially playing the keyboard.  At one point, I wanted to do music full-time, but I never had the commitment it took to succeed.  I was part of a rock band that kept searching for a label deal that never came.  I gave up.  It wasn’t for lack of passion, I still play these days, but I’m just not committed.  Not only do you need to be committed, you need to hire people who are committed.  It takes a committed team to build a successful business.  Like I mentioned at the beginning of this post - the startup road is very hard - if you aren’t committed, you’ll never make it.

There’s a reason a lot of folks are just dreamers and not entrepreneurs, it’s just plain hard and risky.  I think that’s what makes entrepreneurs special and why the journey is so fun.  It’s a truly unique and very rewarding experience (even if not monetarily).  Live it up!

This post was written by Andy Liu, a serial entrepreneur and angel investor. Andy currently runs BuddyTV, sits on several boards, and blogs at InspiredStartup about staring and growing successful businesses.