How can I traffic to my website cheaply? Is it all about advertising banners and buttons? So you don’t have much money to spend, but you want to get some traffic to your website. Sure, you are going to reinvest in your website after you rollout the first stage and make some money, but you need that first bump of cash to get you started. Top three cheap ways to get traffic to your website are: 1. Google Adwords: Here is where you are going to need to search for a $100 voucher for Adwords in Google. Find one, sign up and start paying for some traffic. This is going to give you traffic in one hour. It’s going to cost you but you will get traffic. Cost benefit – This tactic is a sure way to get qualified traffic but if your niche is competitive it can cost you more money than a new customer is worth. Test it – What you want to do with this one is test it. Spend only a small amount of money and then find out what works. You will probably need to tweak your website or form a little and then you want to load up another $100 or so from your credit card and try again. You have to treat this business expense as part research and part marketing. The end outcome you want to achieve is a channel of traffic that is coming in and making you money day in day out. That way you can spend more time trying each of the cocktails on the drinks menu as your website keeps making you money. 2. Search Engine Optimisation: SEO is a time consuming and slow build process in your business that can bring in serious traffic once you crack some big keyword rankings. Here are four quick wins: Keywords – Ensure your website has the keywords you want to rank for in the content of your homepage and unique title tags for each page of your website. There are loads of other things you can do but if you just start with these two things it will help get you to that first 100 visits. Get some listings – You need a few early win links to your site, some directories, a link from a friend and any other links you can scrounge up. List your business in an Australian directory as opposed to an American one. It gives you a better chance to get actual relevant traffic and will help you more with your rankings. Add some new content – Add some new content to your website that is about topics in your niche. Spend $35 on some new articles with a writer from oDesk or Elance and build out your website. 3. Email: Sending emails to people inviting them to your website for a high valuable reason is a great way to start. For example: All the daily deals websites at present work by sending people emails of the latest deal. The only way you can become one of those deals is by offering an insane price and offer that will cause you to lose money, otherwise the deals website will burn their list as it wasn’t a deal. You could try a daily deal site but its best to do some maths first to see if you can handle the volume. Here are some other ways to get email traffic: Send an email to your peers – Collect up all your business cards and put them in a list, send an email announcing your new site and ask your colleagues for feedback on what they think of it. The sheer process of researching your site will imprint it in their minds and they might refer your site to someone else in need! Write an article – Add a helpful article to a friend’s business eNewsletter and you will get a few residual visits from their site. Make sure you make your article 100% dedicated to their customers and just educate and inform. The keen visitors will come through. Forward an email – If you find an email or some article that is helpful, forward it to someone who might use it. Ensure you have a call to action in your email signature and you might get some residual traffic if it’s forwarded on again. Build a database – You will also want to be getting email subscribers from your website, so ensure you have a form on there. Offer a free guide or eBook if they sign up and you will probably get a better response. Here are some of the other ways you can get traffic but you might want to consider them after you have around 100,000+ visitors. Banner ads – Banners are pricey and their click-through rates are low; around 0.1% yes that is 0.001! People do click on them. But you have to buy a lot of them. Top tips to try when starting with this: Use cost per click – Buy your banners so you pay each time someone clicks, not by the number of impressions. Pay per sale – If you can get a deal set up like this through the performance media channels of the different networks, try it! Facebook ads Everyone is on Facebook but they aren’t on it for the same reason as Google. On Google you are searching to find something and take action. On Facebook you are there to hang out with your friends. Use Facebook ads when you have a competition or timely campaign that is relevant and catchy. For example: If you are a charity and you are having a toga party to raise money, you might want to try Facebook ads and target young single males. Test it – You can burn money FAST on Facebook but it’s again worth testing. Basic metrics – Facebook’s advertising reports aren’t quite as sophisticated as Adwords, although you can still set up conversion metrics with it. It’s messy, but worthwhile. Twitter, Viral, Facebook and that social stuff: Social media and getting traffic from it is again a slow build. You need to build your profile and interact. Think of it like going into a new town, you want to meet people and become friends with them before you ask them over to your house for a BBQ. The best ways to do this are: Help people – Be helpful. Helping others makes you a go-to person. The more helpful you are the more people like you and the more influential you will become. Regular – Keep plugging away. Keep helping people. Short no talk stints are ways to get your tweets and status updates ignored. Be interesting – Boring tweets and links get ignored and you unfollowed. Offline: Don’t forget that people aren’t online all the time. People who come from offline media to your website needed to remember your URL and have made the effort to turn their computer on and go to your site. Market to offline media like: PR and magazines – A good story and bring in a solid amount of qualified traffic. Leaflet drops – If you want local customers, just canvass everyone house in your local area. Eventually they will see your leaflet! Signboards – If it’s cheap or free to put a sign somewhere, put up an ad, it’ll just tick away! Business cards – Put your domain name on there and a reason to go to your site. Get a free phone, free eBook or free video. Events – Speaking at an event makes you authoritive, some people in the audience will really resonate with you and you need to put your website up so they can get more of you! What specifically you give them when they arrive needs to connect to what you were talking about otherwise you will lose them.
Susan Wu is a start-up veteran and investor who has worked with some of the best founders in the business. She IPOed her first company at 24 and advised companies including Twitter, Square and Medium. Wu has recently moved from Silicon Valley to Melbourne to head up the Australian team for payment software Stripe and will be speaking at an upcoming Startup Grind event. She spoke to StartupSmart about some of the most important things she’s learned about start-ups so far, including focusing a team and vision around first principles rather than products. “I’ve found that the best companies I’ve ever been involved with were ones where the founders were committed to delivering genuine, lasting value (either in the form of happiness or improved quality of life) to their users above all else, and were committed to being patient in accomplishing this goal,” Wu says. For example, Stripe is a payment software, but the team are focused on boosting the GDP of the internet. At the moment this is through providing a frictionless payment system, but the scope to grow beyond that is unlimited. She says this approach has been shared by many of the founders she’s worked with, including Twitter’s Jack Dorsey and Evan Williams, Flickr and Etsy founder Caterina Fake, Elad Gill from Google, and Stripe co-founders Patrick and John Collison. “When I reflect upon it, I think that what all of these people have in common is an unusual curiosity and drive towards understanding the world. Being a leader in our industry isn’t just about building products that generate billions of dollars of revenue, it’s also about illuminating new ways of thinking about products, users and communities that lead to entirely new ways of interacting or transacting online.” Focusing too much on generating revenue to the detriment of getting the user experience or core value proposition product can create a weak foundation she cautions. Having survived and thrived in start-ups for decades, Wu says getting the relationships right - whether it’s between co-founders, company and customers or product and users - is critical. “The most frequently repeated thing I counsel is that founding a start-up with someone is like getting married. In many ways, it’s just as emotionally intense, you’re stuck together for at least five to seven years (if the company goes well), and you had better make sure to do the same amount of diligence in figuring out that you want to be ‘married’ to your co-founder as you do your real life partner.” Comparing the local start-up ecosystem to Silicon Valley in 1996 and 1997, Wu adds there is great opportunity for Australia to build the community they want. “We don’t need to inherit all of Silicon Valley’s shortcomings. We can choose which parts we want to adopt and which parts we want to evolve,” she says. “It’s still relatively early days and there remains a lot of work we need to do to strengthen the community, but there’s plenty of promising talent and growing momentum.” Wu agrees with ongoing local commentary that one of the primary issues facing the sector is a lack of risk capital, adding investors here don’t look upon past start-up failure as a positive signal as many investors do in Silicon Valley. As an investor, team is the most important factor for Wu, who then looks at scope and slant or vision, and ability to execute. “Though I’ve never articulated it as such before, there’s a simple litmus test: Am I learning something by talking to this founder? Are they saying something insightful that helps me see the world in a new way? Are they saying things that force me to question some of my basic assumptions?” she says. Wu adds Australia has also reached the right time to make sure the community is doing everything possible to encourage female founders and engineers.
Today, like so many other days, your humble correspondent arrived and sat down at a desk in Taskmaster Towers. On the desk was a post-it note. Scribbled in the secretary’s handwriting, it appeared to say someone had called the office asking for the contact details of a well-known industry figure, who we’ll refer to as Jane Doe. As it turns out, many, many moons ago, a blog post was uploaded on to the Taskmaster Enterprises blog mentioning Jane Doe. If only someone invented some type of engine – a “search engine” if you will – that would allow you to type in a person’s name and receive a list of related links to websites. This magical, mystical website could be given a name like “Google”, “Yahoo!” or “Bing”. To make it extra easy for people, you could place the search field in the menu bar of just about every popular browser, including Safari, Internet Explorer, Firefox and Chrome. Such a service could even be funded by placing paid advertisements based on the search words. Then people could type in “Jane Doe” and find the official Jane Doe website, then click the link that says “Contact Jane Doe” where Jane Doe’s work number, email address and Twitter handle could all be conveniently listed. Of course, even if such a magical, mystical service existed, some people would outsource the effort to someone else! And by somebody, I mean poor Old Taskmaster! Blah! Humanoids! I swear, they annoy me some days! Serenity now. Serenity now. Serenity now. Still, the whole episode is a poignant reminder of a couple of key business lessons. The first is the value of quality content as a marketing strategy. It really is the gift that keeps on giving! Seriously, if you haven’t updated your blog or your social media lately, do it now! The second and more important lesson is that most humanoids are lazy. Exceedingly lazy. (Well, okay, often stupid as well, but mostly just lazy.) The desire to do more with less effort has been one of the driving forces of human progress. Why hunt or gather food when you can plant some seeds, enclose some animals and wait for them to be eaten? Why grow your own when you can go to the supermarket and buy it ready to cook? Why cook it when you can microwave it? Why microwave it when you can just get Maccas? Why get Maccas when the local pizza shop delivers? Why wait for a driver when a drone aircraft can deliver it quicker? (Do you doubt that last one will happen within the next five years?) If you’re looking for a business idea, you could do worse by thinking through the worthless chores that annoy you and devise products and services that can avoid them. Because if your business plan enables your fellow human beings to that little more idle, you’ve got a potential consumer base. Sloth is a vice, not a virtue. But it’s one you can exploit – for profit! Get it done – today!
I’m starting a new retail business and I’m not very techy. Can I survive without having to adapt to all this modern day hoo-ha? Once in a generation, retail goes through a change that could never have been predicted – and cannot be ignored. Here are a few examples of such change: In 1984, we rushed into the shops on Saturday morning knowing that if we didn’t buy what we needed by 12pm, we wouldn’t be able to shop again until Monday morning… Very few of us would have believed Sunday would become the second biggest trading day of the year for most retailers just 30 years later. In 1954, supermarkets as we know them today didn’t exist, with 90 cents of every dollar spent at a small, independently owned business... Very few of us would have believed that just 60 years later, they would take 80 cents in every dollar spent on consumable goods. In 1904, horse feed, rum, coffee, coal and clothing was all purchased at the same store, usually on an account or “appro” (on approval)... Very few of us would have believed that up to 80% of purchases would be spent on a plastic debit or credit card just one generation later – some of it by just touching the card against a pole. In 2014, any retailer that says online shopping, e-tailing, retail-apps, or social networking is just a trend they can do without may well be reminded of the above. Today’s generation research product and price on the web, read online forums for tips where to shop, use mobile apps to find a coffee or clothing (and maybe even horse feed), pre-pay with PayPal, and use their phone to store their ‘frequent coffee’ credits. Facebook is The Argus of today (look it up kids), Instagram is the Christmas catalogue that was once stuffed in the mailbox, Twitter is today’s radio advert telling you that 20% off all stock starts in 15 minutes, and blogging has just about replaced ‘word-of-mouth’ as the best way to give and get feedback on good service or a yummy muffin! So before you think we are in the middle of a short-lived trend, think again about the once-in-a-generation paradigm shift that is really going on – with or without us! My suggestion: bring your kids, nieces, nephews, friends and staff around for a BBQ, and pick their brains as to how to adapt, sustain, evolve and grow your business by being a part of the new world that has emerged. To answer your specific question: Can you survive? Of course, you can ‘survive’ – the way a weed manages to survive in the cracks of the footpath for far too long. But you won’t thrive in the way the manicured and well-fed garden bed thrives growing right next to the same footpath!
In business, you have some real dog days. For example, your humble correspondent recently read about a zoo in Luohe, China, that suffered a business dilemma. Namely, the resident African lion was taken off to a breeding facility. Of course, this created a problem for the zoo, because an empty big cat cage tends to look a little raw. Especially given their customers paid to have a roaring good time while seeing a lion. So how did they deal with this hairy situation? They decided to put a large, long-haired dog – a Tibetan mastiff – in a lion costume. No, this is not a tall tale from Old Taskmaster. Here’s the link if you don’t believe me. Unfortunately for the zoo, the patrons soon became suspicious – especially when the “African lion” began barking. Sure, some of the patrons might have thought they were going barking mad. However, based on a lifetime of experience, there are always tell-tale signs your lion’s bite might be less mighty than its bark. For example, a lion compelled to stay, sit, fetch or heel on command is generally a dead giveaway. A dog burying a bone is rather unthreatening – a big cat doing the same not so much. And, really, who wants to see a lion spending all day sniffing another lion’s hindquarters or slobbering all over the carpets?! While this example is well and truly a howler, the underlying business issue here is one of trust and expectations. Customers and consumers have expectations of the goods and services you provide. If a parent takes their son or daughter to the zoo, for example, it’s a reasonable expectation they’ll see a lion. When they purchase your product or service, they do so trusting that you will deliver their reasonable expectations. For example, the child as a consumer trusts they’ll see a real lion today, while the parent as a customer trusts that their children will be entertained enough not to terrorise the neighbours – or lionise the telly. By putting a dog in lion’s clothing, the zoo betrayed that trust. Sure, they faced a dilemma, but their solution really barked up all the wrong trees. So is there a prospect that your business, for whatever reason, won’t be able to deliver to your customers or consumers the product or service they expect? If so, you need to manage their expectations before they agree to buy, or let them know at the first possible opportunity. If you have a physical store, this might mean putting a sign in the front window saying you’ve sold out of a particular item. Or it might be placing a warning on your website that you are expecting delivery delays on a particular item, or a Twitter message saying your stock is currently limited. Because at the end of the day, no one wants to see a lion go whacko for a Schmacko! Get it done – today!
Facebook is 10 years old today. It’s time for birthday celebrations for the social network with 12,800,000 Australian users and 1.19 billion users worldwide. But it’s also time to reflect on 10 interesting things you don’t know about the social network. 1. The social network makes more money now from mobiles than PCs Facebook is worth around $US135 billion and has successfully made the shift to focusing on mobiles. In Facebook’s fourth quarter earning report filed on January 29 this year the social network disclosed that for the first time sales from ads on mobile phones and tablets exceeded revenue from traditional PCs. In an interview marking Facebook’s 10th birthday, founder Mark Zuckerberg told Bloomberg the shift to mobile was “not as quick as it should have been”, but “one of the things that characterizes our company is that we are pretty strong-willed”. 2. Facebook tried to buy Snapchat In 2012 Facebook bought Instagram for $US1 billion even though the photo sharing app had no revenue source. Zuckerberg described the deal as a milestone, saying "we don't plan on doing many more of these, if any at all"; but last year, Facebook reportedly offered $3 billion to buy Snapchat. On two occasions. Snapchat refused the offer. 3. Paper has just launched Facebook’s latest creation is a newspaper-style app called Paper. Paper includes photos, friend updates, and shared articles in an image-heavy, uncluttered way. The stories are picked and ordered based largely on how much they are shared and “liked” on Facebook, with a team of human editors ensuring that the content comes from the right sources. “Paper makes storytelling more beautiful with an immersive design and full-screen, distraction-free layouts,” Facebook states. 4. Zuckerberg and Facebook are all about goals Zuckerberg told Bloomberg he has lots of goals for Facebook and for himself personally. Facebook’s founder has in previous years vowed to learn Mandarin (2010), to eat only animals he slaughtered himself (2011), and to meet someone new each day (2013). For 2014 he intends to write at least one well-considered thank-you note every day, via email or handwritten letter. “It’s important for me, because I’m a really critical person,” he says. “I always kind of see how I want things to be better, and I’m generally not happy with how things are, or the level of service that we’re providing for people, or the quality of the teams that we built. But if you look at this objectively, we’re doing so well on so many of these things. I think it’s important to have gratitude for that.” Story continues on page 2. Please click below. 5. Voting is the most talked about topic on Facebook The 10 most talked about topics on Facebook in 2013 by Australian users were ‘vote’, Kate Middleton, cricket, Kevin Rudd, Grand Final, Election, GST, Lions, Tony Abbott and Big Brother. 6. It’s set to compete with Google Over the next five years, Zuckerberg wants Facebook to become more intuitive and to solve problems that in some cases users don’t even know they have. He wants to target the 5% and 10% of posts on Facebook where users pose questions to their friends, such as requests for the names for a good local dentist, or the best Indian restaurant. Zuckerberg told Bloomberg the social network should do better at harvesting all that data to provide answers. A domain which is traditionally the preserve of search giant Google. 7. Users are a devoted bunch Facebook users generally log in to the social network regularly and stay for long periods of time. The percentage of Facebook users that log in once a day is now 76% while the average time spent on Facebook per user per month is 8.3 hours. 8. Facebook is targeting developing countries Facebook is targeting developing countries through the formation of a group called Internet.org with six other technology companies, including Samsung, Qualcomm and Ericsson. The group is looking at simplifying their services so they can be delivered more economically over primitive wireless networks and tapped into using cheaper phones. Zuckerberg says more users in undeveloped countries will subscribe to mobile services for the opportunity to use Facebook, which in turn makes it more economical for mobile operators to improve their wireless networks to support higher-bandwidth services such as online education and banking. He has described early tests as “promising”. 9. Doomsayers warn Facebook could go into rapid decline Researchers from Princeton University published a paper earlier this year suggesting Facebook might lose 80% of its users by 2017 entering a period of “rapid decline”. “The application of disease-like dynamics to [online social network] adoption follows intuitively, since users typically join OSNs because their friends have already joined,” says the study, which is awaiting peer review. Facebook has hit back at the work as “incredibly speculative” and used its own data engineers to use the same methods of "scholarly scholarliness" to prove that Princeton itself was on the brink of extinction. 10. It’s king of social referred traffic Facebook is still the king for social referred traffic, according to Adobe’s most recent social intelligence report. But Facebook is slowly losing ground to other social media, in particular Twitter and Pinterest.
In the internet world of accelerating change, law reforms are being proposed and passed at breakneck speed. Much of the focus in Australia is on risk management as the internet is difficult to monitor and regulate. But with many disputes coming from overseas business sites, Australia is looking to the global initiatives in many of their proposals. Plus there is a large increase in online Australian businesses expanding offshore so it hard to ignore what’s going on in the rest of the world, especially if it may affect your business. Be prepared and plan ahead by watching out for some of the upcoming trends: 1. Privacy laws Privacy requirements for your business have and continue to be in the forefront of most western countries. The onus is now on business owners to ensure they know what their service providers are doing with respect to keeping and sharing your customers and business data both on and offshore. As well, you will need to be able to answer to both customers and regulators on the security measures your website ‘providers’ have in place for collection, storage and transmission of business and personal information. (More information is available at the Office of the Australian Information Commissioner’s website.) 2. Cookies policies and active notifications Notification requirements are being reviewed and regulation is making more business owners obtain active consents where certain customer information is collected and customer behavior is recorded. This means you need to know when you need your customer to actively agree to your terms rather than just post them on your website. It will also impact what your business collects, why you collect it and what you do with it. And if you are collecting information from cookies placed on your visitors or customers computers, be sure to notify them and actually be using it in your business analysis-otherwise you may find yourself breaching other laws such as the new Australian Privacy Principles. 3. Copyright reform Make sure you know where your content and images come from. This is becoming an increasingly monitored (and complained about) issue with the increase in ‘sharing’ in social media. The Australian Law Reform Commission report and recommendations to the Attorney General on this reform should be made public in March 2014 – watch this space. 4. New cyber security laws The European Union (EU) and the United States (US) are trying to work on new policies to address cyber crime. The EU is working on reforms to get member countries to agree to have compulsory reporting of cyber attack crimes to national authorities. They want to have an arrangement that countries will give up nationals who commit such crimes against EU or US but this is meeting some resistance. All in all, a good initiative to protect your business! Story continues on page 2. Please click below. 5. Data collection After the NSA fiasco and issues with Facebook and Twitter tracking individual’s preferences and behaviour, there is and will be more regulation in relation to tracking systems, particularly those permitted by large tech companies. Opting out of tracking will be more and more difficult as larger corporates will look to improve their ability to collect personal data for advertising databases. Singapore has already instituted legislation of which the main provisions come into effect in July 2014. The US announced through the Office of Federal Contract Compliance Programs new data collection tool regulation to be proposed and the International Association of Privacy Professionals (a body that represents 83 countries and makes gov’t recommendations) has cross border/international online protection at the top of their conference agenda in April 2014. What does this mean for you? It will be harder to protect yourself and your customers’ information online. You are responsible for protecting your customer’s information so your security systems and those of your service provider will need to be robust particularly where international providers or customers are involved. 6. More Local Regulation for Online Businesses Australian regulators are hitting out as business use of the internet grows. Everything from tax collection, legislation compliance, consumer protection and privacy are all on the radar among some of the other legislative changes that are continuing to be examined in 2014. You can be sure that tax revenue will be top of the agenda! The best thing you can do is to be sure you are always updated and keep informed. You cannot afford to ignore it nor leave yourself and your business exposed. Your assets and your business are at stake. 7. Online businesses to be targeted for taxes in other countries With growth in sales at bricks-and-mortar shops shrinking, and purchasing on the internet growing daily, governments are looking to find ways to tap into the sales revenue. By 2017 global mobile commerce transactions will exceed US$3.2 trillion up from $1.5 trillion in 2013 (source: Juniper Research, Mediabistro). Be aware of the tax reform proposals where your online business has customers-you don’t want to be caught out. 8. Crowdfunding This new innovation is virtually unregulated so far in Australia and is growing faster than any other funding source for businesses. It’s making entry costs for individuals who want or have started businesses more feasible – it’s becoming a global way of accessing funding. Watch out for this new way that businesses are finding investors to help them grow. Don’t fall behind with your online business. Like any business, large or small, change is happening fast and you need to keep up with it.
Four-month-old start-up tackling coupons, contests, Lady Gaga and seeing 100% monthly revenue growth1:19PM | Sunday, 12 January
Coupons have been a playground for start-ups for years, with one of Australia’s biggest start-up success stories, RetailMeNot, selling for $90 million in 2010. The team behind Gleam is also tapping into the power of coupons, to help small businesses get the most out of their social media networks. Launched in October 2013, Gleam is a software platform that businesses can use to run contests and share coupons such as discount codes. They recently ran a competition for Lady Gaga’s upcoming Australian tour, and co-founder Stuart McKeown told StartupSmart both their revenue and user engagement is growing by 100% month-on-month. McKeown told StartupSmart their recent growth is due to changes in Facebook’s algorithms, which have lobotomised the marketing plans of many small businesses that had previously been able to reach more of their followers for free. “One of the big problems in marketing and growth hacking at the moment is the drop in organic reach in Facebook. We’re working with businesses that have hundreds of thousands of fans but they’re only reaching 5% now,” McKeown says. The platform enables companies to run competitions on their social media profiles and own site. The competitions are commonly used as traffic or sign up generating tactics, or to convert Facebook page fans to Twitter followers or newsletter subscribers. “As a business, where you really want people is on your newsletter list. By running contests and offering coupons as rewards, we’re helping people to diversify their social portfolio so you don’t have all your eggs in the one social network basket,” McKeown says. The software as a service start-up has 15,000 users and runs on a freemium model with a conversion rate of just above 10%. McKeown’s co-founder John Sherwood is working on the business full time, and McKeown is hoping the business will continue to grow so he’ll be able to do the same later this year. This is their 9th project together. The team’s focus for the next few months will be on growing the business with both new products and partnerships, such as the one they recently signed with online ecommerce checkout company Shopify. “We’re doing a lot of growth hacking and we’re really focused on user acquisition. A key way we’re going to grow is through partnering with third party platforms, such as Shopify. We’re just getting started with leveraging that opportunity,” McKeown says. The Lady Gaga project with MCM Entertainment inspired the Gleam team to start developing a white label version of the software to be used by agencies for larger projects. They’re also developing a range of software plug-ins, and have started exploring referral and social review tools.
Beta rounds, where you get a small group of people to use your app as testers and provide feedback before you launch, are a fundamental part of smart start-up development. But actually getting feedback from your testers is a challenge the start-up community needs to swap notes about, says Hello Code co-founder Beth Belle Cooper. “The big thing that surprised me about the beta round was it was so much harder to get feedback than I thought it would be. I hadn’t heard this issue talked about how much you need to follow up, so it’s been a learning curve,” Cooper told StartupSmart. Hello Code’s first product, web app Exist, connects data sourced from other digital devices such as sleep cycles and step counts and turns the aggregated information into trends and actionable insights to improve your health, is currently in a private beta round with 22 users. “We want to hear from everyone who is interested and use their insights wisely,” Cooper says, adding feedback has been instrumental in their six-month development journey so far, including a breakthrough during an interview with the Startmate accelerator program. “The big thing we learned then was the original idea was too broad. We’re so excited about the long term vision of combining all different kinds of quantified self-data that it was massive and unruly. We had to choose an area to focus on so we could prove the value before we scale,” Cooper says. They have over 1600 people on their waiting list, and plan to launch a public beta round within the month. As soon as someone signs up for updates on the app, they’re sent an email from Cooper or co-founder Josh Sharp welcoming them. “Every time someone signs onto our waiting list, and it always includes a question to start a feedback loop and conversation going from the beginning,” Cooper says. They stay in regular contact with their testers, emailing them every time there is a new update or feature, and always including questions and asking for feedback. But Cooper says this didn’t work as effectively as they hoped. “We found the best thing was to chase them up personally when they do something with the app that we found interesting. It was direct and personal and specific, so they were more likely to respond,” Cooper says. The other tactic that has worked for the team is catching their users on Twitter. “If we can catch them on Twitter, people are far more likely to respond with a quick tweet or two than to sit down and fill in an email or survey,” she says. “We share links and ideas from our account, and while we get all sorts jumping in, we’ve found our users are more likely to respond than anyone else.” They discovered the most effective content for social sharing was Cooper and Sharp’s own insights, because these provided an example and direct connection for users. “Sharing how we personally use the products ourselves created the most responses, both from on lookers and users. If we share a screenshot, or how we’re using it, that’s where people jump in. Examples of how it can be useful can be seems the most powerful tactic for sparking conversations,” Cooper says. After the public beta round, Cooper plans to use what they’ve learned to identify the best product market fit within six months. “Once we know we’re on the right track, and which parts our users actually use, what they like and what we can skip, we’ll start scaling the app out to include other kinds of data,” Cooper says, adding they focused on health because of greater customer awareness. “It’ll be super helpful for lifestyle and finances, but nothing like it exists in those spaces yet. But people have devices that measure health data, so it’s more of an extension of what exists so there are communities of people who get it. Once we’ve done that we can broaden it into other areas.”
No matter what your opinion of social media, it’s become a ubiquitous feature of our lives. It’s also rapidly evolving, with new platforms and features being developed to capture people’s attention and possibly become the next Facebook. Businesses are also catching on with their own presence on platforms as they need to be where their customers are. There was plenty of news and advice for readers this year on the latest developments and ways to get the most out of tweets and hashtags and posts and pins. Quixomatic consolidates social media pages The story of Sydney-based start-up launching its platform that consolidates a company’s social media pages generated plenty of interest for readers. Co-founder and managing director Brett Poole, who previously worked for Yahoo, told StartupSmart the idea emerged from the trend of start-ups and small businesses being active on social media first to build traction before investing in creating a website. Quixomatic uses the information already on a company’s Facebook page to generate a mobile-friendly website. It also plugs into other social media platforms such as Instagram and YouTube. Who owns what on social media? When you post content on social media, who do you think owns it? Many people will say the person who posts the content. That may be true, but the content maker may not be the only owner. Mentor Vanessa Emilio looked into the issue here and warned readers to be aware of what could happen to their content. Time-saving tools for Twitter A tweet has become more than what a bird does. It’s now a message to the world that can whip up outrage, embarrass or entertain. It’s also a powerful tool for business engaging with their customers through the Twitter platform. But for the busy businessperson, managing their Twitter account can be time consuming. Lauren Ridgway offers here some time-saving tools when using Twitter, including using Tweetdeck and various analytical tools. Facebook accelerator program for small business Many small businesses have a Facebook page. For those who don’t want to create their own websites, it’s a relatively simple option for them. The news that Facebook was offering places in an accelerator program to help small businesses get the most out of Facebook was widely shared. “Many small businesses are doing great things on Facebook and we are committed in helping them continue to unlock the opportunities open to them,” Nick Bowditch, Facebook’s manager of small business in Australia and New Zealand, said. What’s better – advertising a business or using social media? Advertising and social media provide different paths for promoting your business, as mentor Dean Ramler writes. But in today’s business world, it’s no longer a question of one or the other. In this post he outlines how social media can be great for engaging with customers while online and traditional advertising also play a role. “Any good marketing program should combine both advertising and social media for maximum impact,” he says. Some more articles worth reading: How to build social media hype for a crowdfunding campaign; Twitter announces a partnership with a young Sydney start-up; and Why social media is a must when you want to sell your business.
This year was a good one for start-up investment. Globally, early stage seed funding rose by 375% and the local industry welcomed some new funds, along with the rise of crowd funding and the coming wave of crowdsourced equity. Here are some of the most notable investment stories of 2013: State of the venture capital scene at the end of 2013 Over 60 venture capital industry leaders gathered for an event held by PricewaterhouseCoopers in October to explore the state of the sector and possible future directions. StartupSmart was there and reported on the event here. Kar-Mei Tang, head of research at national venture capital industry association AVCAL, told the room the sector was set for significant changes in the coming years as the start-up ecosystem developed. “The start-up sector has been an emerging force over the last three years and we’re starting to see more founder investors and super angel activity which will filter through to venture capital,” Tang said. New major firm Square Peg Capital launches Two investment groups merged to form Square Peg Capital, an initiative with Seek co-founder Paul Bassat. He told StartupSmart they were keen to fill the Series A and B gap in the local funding scene. “We’ve got the capacity to invest several hundred million dollars over the next few years,” Bassat says. “We have a really good pipeline at the moment. Our investments so far give some indication of the opportunity; although it’s possible we’ll make slightly fewer investments but they’re likely to be a bit larger.” The two funds prior to the merger had invested $20 million in 12 companies including Canva, NinjaBlocks, bellabox and Vend. Investment insights Global investment trends indicated the venture capital and games boom may be ending, with leading start-up investor Jonathan Teo visiting Australia in late 2013, and shared which metrics he cares about when assessing start-ups, and why he backed Instagram, Twitter and Snapchat. Blue Sky Alternative investments launched a $10 million fund earlier in the year. Their venture director Dr Elaine Stead shared what they look for in the start-ups they back and how the venture capital industry is changing. Blackbird Ventures also launched this year, and have made 11 investments so far. Managing director Rick Baker shared their insights and investment preferences here. Crowdfunding and interest in crowdfunded equity skyrocketed While crowdfunding continues to boom, interest and opportunities for start-ups to explore crowdfunded equity are also increasing, with a new platform launching in December, and visiting Israeli investment expert telling investors the world needed to brace itself for an “unstoppable wave” of crowdfunded equity. Australian start-ups announcing investments almost weekly As the start-up ecosystem matures, more and more Australian start-ups are announcing investment deals and expanding internationally. There are too many deals to list them all here, but notable technology start-up deals include Zenogen, BugCrowd, Recruitloop, Design Crowd, Kickfolio (now called App.io), Kounta, BuyReply, Ingogo, Tiger Pistol, Paws for Life, CoinJar and LiquidState. For those aspiring to raise investment in 2014, we spoke to one of the Kaggle founders about how they raised $11 million in a few weeks in Silicon Valley and from veteran start-up consultant and investor about his top five tips to genuinely prepare your start-up for investment.
The tech sector has always been hyper-competitive, and never has this been truer than in 2013. For the likes of Twitter, Samsung and Google, the harvest of 2013 was bountiful. However, from the perspective of Nokia, Microsoft, BlackBerry or the PC industry, it was a year to forget. Here’s a look back at 10 of the big events and trends that shaped the tech sector in 2013. 1. One billion smartphones sold this year – and counting The most important tech story of 2013 didn’t take place with a major product announcement or a Steve Jobs-style keynote speech. Instead, it took place without fanfare at an ordinary mobile phone retailer somewhere deep in suburbia. It was there that a consumer decided to purchase the one billionth smartphone to be sold during 2013. To put that number in perspective, it is projected that 227.3 million tablets shipped worldwide during 2013, 158 million television sets, 180.9 million portable PCs and 134.4 million desktop PCs. Meanwhile, figures from market analysts IDC show smartphones also outsold featurephones worldwide for the first time in history during the first quarter of 2013. What this means is that while smartphones now account for more than half of the 418.6 million mobile phones shipped worldwide each quarter, there are still millions of old-fashioned featurephones being sold each year. Especially in the low-end of the market and in emerging economies, that means there’s plenty of extra room for growth in the future – especially at the low-end of the market. Make no mistake about it. The smartphone industry is big – far bigger than the PC or TV business. And it’s only going to get bigger in 2014. 2. Google Android and Samsung: The juggernaut rolls on The biggest winners from the spectacular, ongoing growth of the smartphone market have been Samsung and Google. Last year, smartphones running Google Android outsold Apple. In 2013, that trend morphed into total industry domination. For example, of the 261.1 million smartphones shipped worldwide during the third quarter of 2013, 211.6 million or over 80% ran Google’s Android operating system. That compares to just 33.8 million iPhones, representing around 12.9% of the market, and a measly 3.6% for Windows Phone. Samsung managed to ship 72.4 million smartphones during the second quarter of 2013 alone, representing around 30.4% of the market – more than double Apple’s sales during the same period. Those device sales also mean increased component orders flowing through the various divisions of the South Korean tech conglomerate, which manufactures everything from semiconductors to batteries and smartphone displays. The growing strength of the South Korean electronics behemoth is demonstrated by its advertising and marketing budget, which has been estimated at around $US14 billion worldwide. To put that figure into perspective, as of 2011, North Korea’s entire national economy was estimated to stand at $US12.385 billion. 3. The PC industry bloodbath While Google and Samsung have had a stellar year in 2013, the same certainly can’t be said for the PC industry. The September quarter was the sixth consecutive quarter of falls, according to Gartner, with shipments falling to 80.2 million units for the quarter from 87.8 million a year earlier. Figures released by IDC forecast PC shipments for the full year to fall 9.7% in 2013. More alarmingly, it appears the emerging middle class in China, India and Brazil aren’t keen on buying computers, with total PC shipments in emerging markets expected to drop from 205.2 million to 185 million this year. Australia and New Zealand led the trend, with a massive 21% year-on-year fall in shipments for first quarter in Australia, along with a more astounding 27% fall in New Zealand. The implosion of the PC market was disastrous for a number of PC makers, including Dell, HP and Acer. In August, HP announced a major shake-up of its senior management team after announcing a large 15% year-on-year drop in net earnings and a 22% drop in revenue from consumer devices during its quarterly results. That same month, Dell reported a massive 72% year-on-year collapse in quarterly earnings, while a consortium including founder Michael Dell, Silver Lake Capital and Microsoft successfully fought off high-profile investor Carl Icahn’s bid for control of the company. And at Acer, founder Stan Shih made a surprise return as interim chairman and president, following the resignation of former chief executive JT Wang and president Jim Wong after the company recorded a record third-quarter loss. The resignations came after Acer announced its consolidated revenues for the third-quarter of 2013 fell 11.8% year-on-year to $US3.11 billion, resulting in an operating loss of $US86.6 million. 4. Surface falls flat On top of falling PC sales and 3.6% Windows Phone market share, the news was dire for Microsoft on another front in 2013. Late last year, Microsoft launched its Surface series of tablets as a first step towards making devices, with the company believed to have manufactured around six million units. The release of the Surface instantly made Microsoft a direct competitor to many of its already struggling PC partners, straining relations in the process. Fast forward to July of this year when Microsoft announced a massive $US900 million writedown on its inventory of unsold tablets. The writedown came less than a week after Microsoft announced a large price cut of $US150 for the struggling product line. Adding insult to injury, Microsoft also revealed it has spent $US898 million advertising the tablets, while only generating $US853 million in sales. According to many leading analysts, the company was believed to have sold just 1.7 million of the six million tablets it had built. To put those numbers in perspective, Apple sells around 14.6 million iPads each quarter, while Samsung sells around 8.8 million. 5. Steve Ballmer resigns During the 1990s, Microsoft was undeniably the 800-pound gorilla of the tech industry. Then, in January 2000, founder Bill Gates stood aside as chief executive, in favour of Steve Ballmer, in order to focus on his philanthropic efforts. Since then, the company has lost much of its former dynamism, and has failed to become the dominant player in a range of new technologies that have emerged since then, including search, tablets, smartphones or social media. In August last year, Vanity Fair magazine journalist Kurt Eichenwald ran a feature exploring why Microsoft fell behind its rivals. A management technique called stack ranking was almost universally blamed. “If you were on a team of 10 people, you walked in the first day knowing that, no matter how good everyone was, two people were going to get a great review, seven were going to get mediocre reviews, and one was going to get a terrible review,” a former software developer told Eichenwald. “It leads to employees focusing on competing with each other rather than competing with other companies.” Add the low market share for Windows Phone, poor sales of the Surface and the PC industry bloodbath, and it became clear something had to give at Microsoft. In July, the company announced a major management restructure, with the company’s strategy shifting to focus on “devices and services”. Then, just one month later, Ballmer resigned as chief executive, with stack ranking dumped as a management technique soon after. The Redmond, Washington-based tech giant is currently searching for his replacement. Story continues on page 2. Please click below. 6. Nokia sold for a song Soon after Ballmer’s resignation, the news was overshadowed by an even bigger story. In September, Microsoft announced it was buying Nokia’s smartphone and devices businesses for $US7.2 billion, with the Finnish telecommunications company retaining its Nokia-Siemens services network equipment business and the Nokia brand name. The deal came after Nokia announced its smartphone sales had slumped 27% year-on-year during the second quarter of 2013, with an overall loss of €115 million ($A190 million) for the quarter. The sales plunge was led by the company’s Windows Phone-based Lumia smartphone unit, where shipments fell 27% from 10.2 million units during the second quarter of 2012 to just 7.4 million for the same quarter in 2013. To put that number into perspective, it was a little over one-tenth the number of smartphones sold by Samsung during the same quarter. It was an inglorious end to a company that absolutely dominated the mobile industry through the 1990s and 2000s. As recently as 2010, when Apple sold 47 million smartphones, Nokia managed to sell 104 million. According to prominent industry analysts, such as former Nokia executive Tomi Ahonen, the fateful moment came in February 2011, when then chief executive Stephen Elop made the decision to switch its smartphones to the Windows Phone operating system. Soon after, a leaked internal letter from Elop known as the “burning platform” memo likened the company’s situation in the mobile phone market to a person standing on a burning oil platform. After the takeover was announced, Elop was named as one of the top contenders for the position of Microsoft chief executive. 7. BlackBerry’s failed comeback and takeover attempt It wasn’t just Nokia that had a tough time in the smartphone market at the hands of Samsung and Google. In January, BlackBerry launched its new, all-touch BlackBerry 10 smartphone operating system. The platform, originally scheduled for late 2011, had been delayed by a year, preventing the company launching a flagship phone in 2012. The Australian launch for the first smartphone to run the new platform, the Z10, came in March at a gala event in Sydney hosted by Adam Spencer. A second device using a traditional BlackBerry keyboard, called the Q10, came soon after. While the reviews were generally positive, the new devices failed to be the big comeback success the company’s then-chief executive, Thorsten Heins, had hoped for. By August, the company formed a special five-member panel to examine takeover options after director and Canadian investment guru Prem Watsa quit the board. In its September quarter results, the full carnage was laid bare. The Canadian smartphone maker reported just $US1.6 billion in revenues for the quarter, down 45% year-on-year and 49% quarter-on-quarter. The company also revealed it sold just 3.7 million smartphones for the quarter – and less than half of those ran BlackBerry 10. Total losses came in at $US965 million, including a massive $US934 million inventory writedown against unsold stock of the company’s Z10 smartphone. The company announced more than 4500 staff layoffs, representing nearly 40% of its global workforce, while Heins bought a new private jet. Meanwhile, the company’s rollout of its Messenger app for Android and iOS was frozen due to technical issues with its release. In early November, with banks uncertain of the company’s long-term future, Watsa failed to raise the requisite $4.7 billion for a buyout, instead lending the company $US1 billion. As part of the deal, Heins stood aside as chief executive, replaced by former Sybase chief executive John Chen, with Watsa rejoining the board. Heins received a $US22 million golden parachute for his efforts, significantly less than the $US55.6 million he would have received had the sale gone through. 8. The Twitter IPO Last year, Facebook’s disastrous IPO ended in tears – followed by lawsuits. Thankfully, the outcome was not repeated when its social media rival, Twitter, listed on the New York Stock Exchange in November. After opening at $US26 per share, the company’s share price surged 72.69% in its first trading session. It closed at $US44.90 per share, before dropping slightly to $US44.44 in after-hours trading. Making the result even more amazing was the state of its balance sheet. While the tech giant has revenues of $US534.46 million and around 230 million users worldwide, it has never posted a profit. Despite this, the company now has a market capitalisation north of $US20 billion, with chief executive Dick Costolo claiming the company’s long-term investment strategy has prevented it from chasing profits in the short term. 9. iOS7, iPhones and iPads For Apple, 2013 was a solid if somewhat unspectacular year. In June, the company released a redesigned version of its smartphone and mobile operating system, iOS7, alongside a new version of its Mac OS X desktop operating system, known as Mavericks. It was the year that Apple finally unveiled a low-cost version of its iPhone, known as the iPhone 5c, alongside a new 64-bit flagship smartphone called the iPhone 5s, complete with a 64-bit processor and a fingerprint sensor. Then, in October, the company unveiled a lighter version of its iPad, known as the iPad Air. None of the products had the industry-shaking impact of the unveiling of the Macintosh, iPod, iPhone or iPad. That said, with billions in profits each quarter, a solid second place in the smartphone market and the world’s biggest selling tablet, solid and unspectacular for Apple is better than most companies could dream of. 10. Xbox One and PlayStation 4 launch Last, but certainly not least for gamers, 2013 marked the introduction of next generation games consoles from both Sony and Microsoft. Coming a year after Nintendo launched its Wii U system, Sony announced one million first-day sales of its PlayStation 4 system, but the launch was marred by a number of angry consumers taking to social media to complain about non-functional systems. Sony’s first-day sales were soon matched by the first-day sales of Microsoft’s new Xbox One system. So how will the two new devices perform over the long term? We’ll have to wait until next year to find out! This story first appeared on SmartCompany.
As Taskmaster readers will know, earlier this week your humble correspondent went for a sales meeting at a busy suburban shopping centre. After visiting one customer, Old Taskmaster trundled through the now narrow corridors to a second store. Slowly. The once wide corridors have been narrowed down by a series of mobile phone store kiosks, meaning a single elderly gentleman with a walking stick and five-year-old granddaughter in tow can now single-handedly slow a whole row of shoppers to a crawl. Seriously, centre management, it might boost revenue per square metre, but it’s a practice that really annoys your shoppers! Anyway, the second sales call was a franchisee of a national chain. During a discussion about the newest widget models from Taskmaster Enterprises, they revealed their biggest business regret. Apparently, part of their franchise agreement states that they have an exclusive ‘territory’ in terms of the location of physical stores. Unfortunately for them, any revenues from sales through the chain’s website or its mobile app go to the franchisor, even if the customer is within the same suburb as an existing store. So if a customer visits their local store on Sunday, looks at an item, and then goes home before ordering it online a couple of days later, the value of that sale goes entirely to the franchisor. As you might imagine, this creates all manner of perverse incentives. For example, the franchisee views the website as a competitor with the same merchandise rather than an asset for their business. Why encourage your loyal customers to purchase their goods from a competitor? As a result, since the company’s Twitter and Facebook accounts are geared to get people to buy online rather than in store, what incentive is there for the sales staff to promote them? As a result, Old Taskmaster was amused to note the sales staff consistently “forget” to ask the customers to follow the chain on Twitter and Facebook – even when the owner or manager is within earshot. The franchisee’s big regret with all of this is to fail to ask the question of how online sales revenues (or profits) are distributed. After all, who wants a franchisor who feels like a rival rather than a partner? Well, Old Taskmaster says this: If you’re looking to become a franchisee, make sure you ask about how online revenues are distributed. It’s always better to ask ahead of time than to find yourself in a business dispute. As for franchisors, be aware that the way you treat your online sales and web presence can create perverse incentives for your franchisees. If a sale can be traced to near a physical franchisee’s store, consider some sort of profit sharing agreement with your franchisees. Get it done – today.
What kind of offers work on social media? Giveaways on Twitter? Competitions on Facebook? I'm not quite sure how to approach this.
Twitter listed on the New York Stock Exchange overnight, with shares in the social networking giant immediately surging by 80.7%. The company has lost over $US440 million since 2010, but claims its user base of 232 million has put it on track to reach profitability through sponsored tweets. “We have a lot of work ahead of us. All the capital raised by this is going into the company,” chief executive Dick Costollo says. “It’s all about making it very simple and easy for new users to come to the platform ... we all have examples of why this service can be useful to everyone on the planet.” ABS September unemployment rate revised upwards The official unemployment rate for September has been revised upwards slightly to 5.7%, despite the participation rate standing at a seven-year low. The participation rate was also revised down from 64.9% to 64.8%, with many job seekers giving up looking for work. Meanwhile, youth unemployment fell 0.5% during the month, but still remains at a relatively high 17.1%. Hunt says carbon tax repeal will immediately cut power bills Environment Minister Greg Hunt has claimed repealing the carbon tax will lead to an immediate reduction in power bills. “It should happen immediately,” Hunt says. “We'll look through our discussions with the electricity suppliers, but the statement from the Electricity Supply Association yesterday was clear and categorical, so I think their words are the strongest words.” Hunt’s comments come despite a warning from the Business Council of Australia, which says any price cut will take time to filter through to consumers. Overnight The Dow Jones Industrial Average is down 0.95% to 15596.74. The Aussie dollar is down to US94.49 cents.
Emerging tech companies may be high risk but when they take off, every nervous moment was worth it. Jonathan Teo knows this firsthand, having been part of the venture capital teams that backed Twitter, Instagram and a host of other tech start-ups before they really began to get noticed. Teo says early stage investment is primarily about relationships, and both the investor and entrepreneur need to be committed to the long haul. “When I’m evaluating a company, it’s far more useful and efficient to start to engage with what’s the vision and to work out if it’s aligned with how I see the world. I ask is this entrepreneur someone who is able to execute on this idea, and is the approach they’re taking the right one,” he says. In the video below, Teo tells StartupSmart why investing in start-ups is worth the risk: In Melbourne for a series of events with investor network Investor Org, Teo told StartupSmart his focus on identifying and exploring the right metrics, and developing relationships has steered his investment decisions, and success, so far. “What I look for are entrepreneurs who really understand a human need, and are able to create a product that can catalyse that and actually fulfil it,” Teo says. “There is a lot of noise in the start-up industry so it’s all about execution. The key determinant of success at the really early stage is survivability. As an investor, that’s gleaned from how they execute each task and their personal resilience.” Teo says he’s especially focused on engagement metrics when assessing start-up ideas, adding these metrics will be different depending on the start-ups goals and growth stage. “Everyone looks at traction, but the big investment question is about which traction are they looking at? Is this start-up’s strength to be spotted in about engagement, growth or even user numbers? Traction takes on different meanings for different investors at each stage.” Knowing exactly what you’re going to build can be a red flag for investors Teo adds the power and value of entrepreneurs is their ideas, commitment and drive, but they need to be open to constantly evolving their ideas to fit the market. “You need to have a big visionary idea around what the world needs and ideas about a product to fit that. But I don’t think entrepreneurs actually know what the best way is to get there, as so much of it is based on the iterative process of what resonates with users.” He adds company growth journeys, market and environment factors are too hard to predict, so founders need to stay focused on the idea they’re trying to solve and building the right foundations for any future changes they’ll need to make. Start-ups should focus on growth to boost capital raising opportunities He says while some start-ups value can come from engagement rather than user numbers, all start-ups should aim to grow in order to generate greater interest in their start-up. “As an investor, you want to care about products that have active network effects and growth, with a sustained engagement models,” Teo says. “Growth itself is something everyone pays up for as the valuation of a company grows, so every start-up needs to be concerned about growth because it’s what drives leverage in terms of raising capital and hiring people. He adds start-ups with strong user engagement metrics and potential for network effect growth can approach investors early, as smart tech investors want to get in on the action before a start-up gets real traction. “Once a start-up has traction it’s almost too late from an investment stand-point. That’s only because by that time it’s obvious to other investors that the start-up is doing well so valuations creep up,” Teo says. “Private valuations are a lagging indicator of the public market’s interest.”
Customer service is instrumental in growing a company, especially for young start-ups. Fiona Adler, founder of online review site WOMO, told StartupSmart innovative start-ups can face the biggest challenges in closing sales and keeping their customers happy. “If the start-up is a brand new concept, there is a lot more indecision and perhaps also people who don’t really understand what’s being offered, which means the business owners need to do a lot of education,” Adler says. Work closely with the indecisive customer Customers who show interest but aren’t motivated are good ones to focus on if you have limited time. According to Adler, they need to be talked the whole way through the process. “This customer needs to be led to a decision and handheld the whole way. You will have to be the leader in this relationship, but if you can earn their trust, they can be very valuable,” Adler says. “Talk them through their decision-making process and find out if there were similar decisions they made in the past that either worked out well, or that they now regret. Be compassionate and remind them what the lack of making a decision can cost them. Demonstrate your trustworthiness with credentials, examples of past work, or customer reviews.” Learn to spot the difference between an indecisive customer and a tyre kicker When you’re dealing with a customer who keeps returning with questions or concerns, you need to assess if it’s because they’re indecisive or if it’s another issue. “Time spent with these individuals is like throwing money (your time) away. Be ready with solid probing questions, especially early in the process, to help you qualify if they will be an actual buyer. This will help weed out the time-waster before you spend hours on follow up and research,” Adler says. Pick your moment and be engaging to close a sale with the distracted customer Adler says the distracting customer can be spotted easily, their smart-phone in hand and a million things to do. The key to closing these sales is realising you’re competing with everything from their family to Twitter for attention. “Speak to them about the various positive features of the products or service, so that they develop a sense of interest and urgency. Strike up a conversation with them, but make sure that you listen to what they actually want – and don’t waste their time. If you can quickly grasp their needs, queries, aspirations and any concerns about what you offer, you can successfully service them – despite having only part of their attention,” Adler says. Handling the know-it-all customer While an informed customer can be great, how they wield that information can create challenges for founders, especially if they’ve misunderstood your offering or their problem. “Rather than spending time answering questions, ask questions. The big problem with this customer is that they’re not very receptive to what you might have to say. In fact, often what they’re looking for is your respect – so give it to them,” Adler says. “Use this rapport and ego-booster to introduce new ideas to them and convince them about your product or service.” Give grumpy customers the time to change their mind Any business will have its share of customers who recognise you offer a solution but may be already pessimistic about your capacity to help. “The first thing to remember is to stay calm and listen to their concerns. Ask questions so they know that you are listening and are genuinely focused on solving their problem,” Adler says. “Make the decision process easy for them by highlighting the benefits of the product or service. At the same time, give them plenty of time and space to express themselves and don’t make them feel pressured into doing something.”
There’s plenty of conversation happening on Twitter. So much that it can be hard to get your words noticed. That’s where hashtags can help. If you use the right hashtag that others are following, you can reach them without them being one of your followers. And as an entrepreneur, there’s a few you should consider using. Social Caffeine has compiled this infographic that lists the best hashtags for entrepreneurs.
At a board meeting this morning, I couldn't help reflecting on our awesome group. A good start-up board helps in many ways but can hinder in others. I've probably experienced the best and worst of what they can do. Creating a board is serious and should be approached with caution. When I started Posse I didn't know much about company boards. A family lawyer helped establish our companies. He suggested I set up a board and try to find some impressive-sounding people to join it. His objective was to make the 'team' list in my fundraising presentation look more appealing to prospective investors. So off I went on a mission to meet big name folks who'd look good on my deck. It didn't seem to matter how many, the more the better. Within a month I'd assembled a board of eight, including myself, and we called a meeting. A friend lent me his board room, a big office in the city. I expected a casual, friendly affair where we'd chat about business and strategy and they'd agree to introduce me to some potential investors. I was in for a surprise. First of all they wanted to know everything. How much money did we have in the bank? What were the liabilities, the budget, how many people had visited the site last week, last month, how long did they stay for, how much money had we made? And so on. I wasn't prepared and it was overwhelming. After a couple of hours of grilling, I gained a sense of what a board expects from a founder. I'd run my own business for eight years and didn't report to anyone. In time I came to appreciate the rigour of reporting. For the next meeting, I made sure I sent out the cash-flow report, budget, metrics, and a presentation outlining what I wanted to talk about – all in advance of the meeting. Six months in, our group hit its first challenge. The business had started well; we'd raised some money and gained traction. Everyone became excited; then, out of the blue, one director presented us with a proposal involving a full-time job and a lot of equity. The group wasn't sure how to react. He left the room while we discussed his proposal, and when we rejected it he was hurt and embarrassed. He quit the board and sent us a huge invoice for his time, which we spent a year fighting and eventually settled. Some members of our original board were excellent and are still active in various capacities today. Others drifted off: they had an expectation that we'd be a huge hit within months and when hard work set in they disappeared. Some stuck around and were destructive when things didn't go their way. I learnt the hard way how bad things become when you have the wrong board. I've also learnt how powerful it can be to have the right board behind you. Here are five tips for start-up founders looking to build and run an effective board of directors. 1. Set expectations up front It's easy to procrastinate about finalising deals with advisors and directors. Everyone is there to be helpful, and at the start it doesn't seem worth negotiating to pay them a share of nothing. The problems kick in after few months when things start going well, and you realise you and they have different expectations about payment. Most start-up directors will expect to receive equity rather than cash, and in my experience the standard rate is 0.5% to 2% vesting over two years. You must determine what you expect of the director. How will they help with fundraising, strategy, introductions and the like? If appropriate, you might want to agree on how much time they'll commit to your business – although when you have the right people on-board it's likely they'll be bugging you with ideas and suggestions for how they can help. 2. Be transparent and organised Your board should be the one group of people with whom you can be completely transparent. It's their job to help you work through challenges; so they must understand those challenges if they're going to add value. I remember at one of the first meetings of our new board, I announced that the product we'd created wouldn't scale. We had to go back to the drawing board and try something else before we ran out of money. No one flinched. We put a process in place that would devise a better strategy. I've also found that board meetings are much more effective when I've put time into thinking through the agenda and have written a presentation to talk through. 3. Make sure your directors have the right experience My original board sounded impressive, but many were impressive in the wrong industries. They had no experience of the challenges of a start-up like ours. So I received bad advice which led us to hire the wrong team and spend too much too quickly. A couple of our early directors had never used Facebook or Twitter and wouldn't even join Posse. Everyone on our current board has incredible expertise in different areas of early stage companies in our space. They know what other businesses are doing to grow, engage users, monetize, save costs and much more. Almost every day, one emails me with an idea or opportunity that I wouldn't have thought of. And through them, we can access almost anyone we'd need to help our business anywhere in the world. 4. Keep the numbers small We have four directors on our current board, including me, and one regular observer who acts like a director except he doesn't vote. It's a tight group: everyone knows the others' strengths; everyone is committed to making Posse a hit. I've heard that the reason to keep boards small is to ensure that as a founder you won't be outvoted. I suggest that if you even think this, you either have the wrong board or you're the wrong founder. For me, the benefit of having a small board is that I can spend time with each person regularly. Everyone is in touch with what's happening and can contribute. 5. Make sure you like and trust people before inviting them to join Directors have much more influence than I originally thought. They decide who leads the company, what deals to do and when to exit, so you must make sure you all share the same vision upfront. You must know they'll do the right thing, and that they'll stick around and support you when you hit tough times. I've heard many stories from founders whose advisors and directors vanished when it looked like the company might fail. We've had hard times and I can honestly say that our group pulls together and digs in, no matter what the circumstances. At my first board meeting I learned what directors expect from a founder. It took me quite a while to work out what founders should expect from their directors. Our board helps me refine our strategy and operation plans; they're constantly suggesting new ideas and making introductions; they've been involved in fundraising; they hold me to account and oversee the governance of the company. The names on our board are impressive but that's not why they're there. I've learned that a top notch board of great people with relevant experience and a shared vision is a wonderful advantage and has made my founder's journey easier and more fun.