New Venture GMU Presentation by Silver Beacon Marketing
Post on 22-Nov-2014
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How will you know if you succeed?
Starting A New Venture
George BounacosSilver Beacon Marketingwww.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
About George (aka Why George?)
GMU alum
Judge SOM business case competition
Fairfax County Consumer Protection Commissioner
COO, Silver Beacon Marketing
4 prior startups, plus federal and B2B work
Silver Beacon Marketing www.SBMteam.com
Universal Successes
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Without a mission and metrics,
how is success determined?
Silver Beacon Marketing www.SBMteam.com
Qualified Successes
The Internet – inventors didn’t intend current use
Constantly changing storage media◦Tape (reel-to-reel, cassette)◦Optical drives◦Solid state drives◦Reset to cloud computing
Silver Beacon Marketing www.SBMteam.com
Measure or
Perish
Organization
• Umbrella goal
• Strategic Plan – 6 mos.
• Marketing Plan – 6 mos.
• Tactical Plan – 1 month increments
Create a success metric
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Why are we starting this venture? What is our financial plan? Who is accountable? How will we define success? When will our milestones occur?
Questions To Ask
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Funny, but true concept #1
Silver Beacon Marketing www.SBMteam.com
What does a startup business call Thanksgiving?
Silver Beacon Marketing www.SBMteam.com
Thursday
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Go All-In
New ventures are not 40 hour / week jobsPrepare to go all-inCommit:
◦Your time◦Your personal resources◦Your reputation
Silver Beacon Marketing www.SBMteam.com
Warren Goes All-In
YourFour
Takeaways
Silver Beacon Marketing www.SBMteam.com
Be RealisticFunding
Cash FlowSales ProjectionsCustomer Service
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Funding Sources1.Bootstrapping
2.Savings
3.Credit cards
4.Family lending
5. Commercial lenders
6.Govt backed lending
7. Selling equity
Silver Beacon Marketing www.SBMteam.com
Cash Is King
“Some people around here better get some perspective. My promotions budget at [company] was bigger than this whole place’s free cash flow.”
--COO to Morgan Stanley partner shortly before road show
Silver Beacon Marketing www.SBMteam.com
Cash Is King
“Someone who owns the company writes on both sides of the paper.”
--the same COO after the IPO blew up
Silver Beacon Marketing www.SBMteam.com
Cash Is King – The Simple Version
Pay yourself and the team
Pay your suppliers
Pay extraordinary expenses
Silver Beacon Marketing www.SBMteam.com
Cash Is King – The Real Version
Pay yourself and the team
Pay your suppliers
Pay extraordinary expenses
Lower sales than expected
Silver Beacon Marketing www.SBMteam.com
Cash Is King – The Real Version
Pay yourself and the team
Pay your suppliers
Pay extraordinary expenses
Lower sales than expected
Litigation / Insurance
Silver Beacon Marketing www.SBMteam.com
Cash Is King – The Real Version
Pay yourself and the team
Pay your suppliers
Pay extraordinary expenses
Lower sales than expected
Litigation / Insurance
Debt servicing
Silver Beacon Marketing www.SBMteam.com
Cash Flow – Famous Business Quote
Yesterday is a cancelled check.
Tomorrow is a promissory note.
Today is cash.
Graphic: allthingsd.com
Hockey StickProjections
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Managers hate unrealistic projections
Silver Beacon Marketing www.SBMteam.com
…but this projection is actual growth.
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Sales Projections
Your organization’s sales growth will not ramp up like Twitter’s
Or Google’s
Or Microsoft’s
Silver Beacon Marketing www.SBMteam.com
Sales Projections
KEEP IT REALOr
Go Home
Silver Beacon Marketing www.SBMteam.com
Customer Service
Silver Beacon Marketing www.SBMteam.com
Customer Service
25 people learn about 1 negative experience
Who knows if this is true?
Who cares?
Isn’t it enough 1 does?
Silver Beacon Marketing www.SBMteam.com
Customer Service
Costs to acquire customers almost always more than to keep ones you have.
But who does that work?
Silver Beacon Marketing www.SBMteam.com
Customer ServiceHiring people costs money.
Average customer service rep salary in Washington, D.C.:
$30,000
Fringe benefits:
$10,000
Explicit Cost:
$40,000 for one person
Silver Beacon Marketing www.SBMteam.com
Customer Service
Who is answerin
gthe phone
when I go to lunch?
:sigh:
Silver Beacon Marketing www.SBMteam.com
Customer Service
New organizations must budget customer or client service time.
That is time not spent making sales
…or working on strategy
…or doing anything but holding on to existing business.
YourFour
Takeaways
Silver Beacon Marketing www.SBMteam.com
Be RealisticFunding
Cash FlowSales ProjectionsCustomer Service
Silver Beacon Marketing www.SBMteam.com
BonusTakeaway
Silver Beacon Marketing www.SBMteam.com
Silver Beacon Marketing www.SBMteam.com
Change
Look for hidden competencies
Silver Beacon Marketing www.SBMteam.com
Earth’s biggest bookstore
Silver Beacon Marketing www.SBMteam.com
Starting a New Venture
KEEP IT REALOr
Go Home
How will you know if you succeed?
Starting A New Venture
George BounacosSilver Beacon Marketingwww.SBMteam.com
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