Monday, April 21, 2008

New Entrepreneurs: What are your prospects thinking?

If only you could read a prospect's mind so that you would know what they really think about working with a fledgling company such as yours. Are they worth your trouble to pursue? Sure. Even the biggest companies like to work with the smallest vendors if the fit is a good one.

Did you ever work at a fast-food restaurant? If you stayed with it for a year before getting tired of sandblasting french fry grease off your clothes at the end of every shift, then you’re a rare breed. Recruiting and retaining good workers is a chronic challenge for restaurant chains. One such company with billions in revenue and tens of thousands of restaurants around the world (think tacos, pizza and fried chicken chains) sought help in finding and keeping employees for its outlets. This restaurant behemoth considered proposals from all sorts of companies, including some relatively large advertising agencies. The company also listened to pitches from firms with experience expressly in employee recruitment. But one tiny advertising agency with no such experience went after the business, too. In this case, size didn't matter.

Even a large corporation can be treated poorly--taken for granted--by its vendors. That possibility was on the mind of the company's global talent manager when she was seeking a good fit for the recruitment program. "I didn’t want someone who had so much experience in our area that they were offering a cut and paste solution," she says. "I wanted someone who could think creatively. Choosing a smaller company meant I wasn’t going to be just a number."

The small agency’s presentation showed they had taken time to think about what their prospect needed. (Don’t forget: The prospect is buying you and much as she’s choosing your company.) “The small agency showed their personalities throughout the proposal process. It let us get to know who they really were,” the talent manager says. “They took pains to understand us and how we worked. They kept doing that throughout the relationship, even after they were chosen.”

Final score
Small company: 1
Big companies: Better luck next time

Thursday, April 3, 2008

If you can't go back...

Maybe you can’t go back to your former employer. If this is a perfect time to start your own company because you lost your job after angering or alienating everyone you ever worked with, perhaps you should consider a profession that does not require interaction with human beings. Perhaps muskrat keeper at your local zoo. If that’s not the case, however, you may still have a good chance of landing customers as a result of your former employment. In fact, you may actually have multiple chances.

Let’s say that Phil was laid off from his marketing job at Dweebco, International. He had been part of a six-person marketing team that was scattered to the wind when financial setbacks forced Dweebco to eliminate its marketing department. While his team members took jobs with other corporations, Phil decided the time was right to start his own marketing consulting firm. The first prospect on Phil’s list was Dweebco. Even though they couldn’t afford to pay a full-time marketing staff, they might still need marketing help. In fact, Phil suspected, they probably needed it more than ever. Dweedco would get the service they need without paying benefits and everything else to a full-time employee. Phil would get to charge a higher rate than his old salary
Suppose, however, that things at Dweebco had gotten so bad after Phil left that the company went out of business. Phil still had five ready-made prospects: his former colleagues. Their new employers were in a much better position to use Phil’s services. They were in a hiring mode, which meant Phil was in the right place at the right time to help meet additional demand. Phil contacted his former colleagues who then recommended him to their new employers, as well as other companies that had a connection to.

When you work for someone else, you are essentially a one-person company existing to serve your employer. If that company hired you once, they should want to hire you again--as an outside vendor--if the you left on good terms.

Go back where you came from

Once you strike out on your own, it's wrong to go back where you came from. That’s admitting failure, right?

Rosie Feeley saw it differently. She was a well paid sales manager for cable giant Comcast. The thing she enjoyed most about her job was training other salespeople. But her responsibilities had become increasingly administrative, so she left to start her own sales training company called Training By The Slice. She politely thanked her former employer for the regular paychecks, said goodbye and walked out the door.

Rosie then spent her first three months in business putting together sales and marketing plans, doing research and other fun things required to get a business off the ground. Then came the hard part: getting customers. She remembers asking herself, “Where do I find these people? I was Rosie Feeley, an unknown quantity, competing against major corporations that provide sales training to other major corporations.” Rosie took the same route many other successful startups do: She went back where she started.

Rosie returned to Comcast, not as an employee, but as a vendor proposing that her new company do some of their sales training in a new way. It was a comfortable and logical fit for both sides. “I knew what Comcast was paying for sales training,” Rosie says. “They knew who I was.”

Rosie had decided early on that she would target small- to medium-sized companies as her main prospects. She couldn’t compete with much bigger sales training outfits for Fortune 500 clients, but it helped to have a recognizable name to toss out to subsequent prospects. Even if Comcast had been a small company that hardly anyone had ever heard of, Rosie was smart to go back where she had come from first. Nobody knows your abilities better than the people who once signed your paychecks.

Tuesday, April 1, 2008

Borrow Credibility

My business partner met a budding entrepreneur at a party last weekend. The guy was the marketing/sales "arm" of a start-up company that developed a web-based storage system for medical records. So far, the company consists of the sales guy, plus the person who developed the software. And neither has left his full time job yet. My partner asked a blunt question : How would the sales guy convince medical offices to trust highly sensitive information to a new product developed by someone working in his basement at night? The new entrepreneur hadn't thought it through that far.

You need instant credibility, which may mean borrowing some. That could come in the form of a strategic partnership with another person or company that is already highly respected in your industry. It may mean starting as an entrepreneurial arm of an established company. You could build your dream within a viable business, while leveraging a bit of their image--and money. A few years down the road, you could spin off into an independent company.

Another way: Grab credibility by certification from a known brand, such as the kind Microsoft offers software developers. Then you can say: "Our people are Microsoft-certified and have expertise in the latest Microsoft web hosting products.” The prospect will hear: “Blah Blah Blah Microsoft blah blah blah blah blah Microsoft blah blah blah.” And then they think, “Hmm. I’ve heard of Microsoft. These people are OK is they’re Microsoft people.” That is, unless the prospect is a Firefox nut.