Can You Really Make Money Doing What You Love?

Recently, author Daniel DiPiazza wrote “An Open Letter to Frustrated 20 Somethings” on Under30CEO.com. It blew up. Daniel’s premise: If it were up to him, why would he make a “job” or “work” the center of his life? When someone asks him “what he does”, why should he have to respond and narrowly define himself by the skills he uses to make money?

I’d spend my life traveling, learning languages, practicing martial arts, reading, programming, eating good food and (eventually) raising smart, open-eyed children.

Touché Daniel, and I agree: there is a better way. Now let me break it down for those on a quest to “do what you love” from someone who’s been through all the ups and downs already.

How We Did It

I graduated from Bryant University having built what the Collegiate Entrepreneurs’ Organization named the best chapter in the world, four out of five years. I was leading a team of 150 smart, young, innovative, passionate people. No way I was getting a “real” job after that.

So upon graduation, I pass up job offers galore to “start my empire” from my mom’s basement outside of Poughkeepsie. Pitching VCs, writing business plans, sending money to India for web development — and still without a clue about how to actually make money from my lawnchair. I call Jared O’Toole to drink some beers on the front porch and we realize there have to be lots of other young people trying to start businesses just like us. We co-found Under30CEO.com.

With no revenue in sight, it’s now the dead of winter, and Poughkeepsie is getting depressing. Then the global financial crisis hits, and we’re really screwed. My mom comes to me shortly after Christmas to tell me that we will be losing our house. The home I grew up in.

Lesson 1: At least be able to tell your mom how your business plans to make money.

Suddenly, I question those $65k+ salaries I turned down. But it’s time to hustle. I accept the first job I can find on Craigslist, a position for a driver, and show up at 6 a.m. Wheeling and dealing can’t be so bad, I think to myself. It’ll be my mobile office…

Wrong. I show up and am given the keys to a dump truck. With an 18-foot trailer. I guess it’s time to learn to drive a dump truck.

I get us to the job site, where I’m quickly informed that the crew of laborers I’m driving around aren’t going to appreciate it if I sit in the truck. Time to dig ditches 12 hours a day for the next six months.

Lesson 2: When you put your back against the wall, you make things happen.

Sure, I could have let go my entrepreneurial dreams and gotten a cushy desk job. But instead, I put myself in the most uncomfortable situation possible. Digging ditches with guys who could work me under the table, and then going home to moonlight Under30CEO until 2 a.m., was absolutely miserable. I was making $15/hour, living in a tiny apartment with my mom. I love you, Mom, but that’s not exactly what I thought my “empire” would entail.

But these early days are what make or break most entrepreneurs. If you can get through this part and still believe in what you’re doing, you can survive.

Lesson 3: Test everything.

We try everything we can think of on Under30CEO.com. We don’t talk about it much today, but Under30CEO was once a Ustream show, then a Ning Network, a Meetup, and a membership site; we’ve offered daily deals, affiliate offers, consulted startups, hosted workshops on social media, done dealflow for VCs — you name it, we’ve tested it.

It’s the smartest thing we’ve ever done. Make little tests, and if they make money, run with them. If not, see ya later!

Lesson 4: You don’t test stuff very long when you’re broke.

While throwing stuff against the wall and seeing what sticks is great, when you’re bootstrapping on a ditch-digger’s wage, you don’t have the money or the patience to test things for very long. You’re trying to get cash-flow positive as fast as possible. Any of the business models listed above are solid ideas and could be turned into million-dollar businesses. Looking back at it, it was probably our biggest curse too. We were looking to get hit the jackpot, and we were quick to give up. Young and impatient? Yes… But also smart. Here’s why:

Lesson 5: Never do anything you are going to hate.

Call me a pretentious, formerly-frustrated 20-something, but we always stuck to our core value of doing something we loved. We loved being in the business of inspiring young entrepreneurs. Many of those other business models were not that, and we knew we would eventually grow to hate them. We listened to our gut, and as corny as it sounds, we followed our dream.

But don’t think for a moment that it was easy.

Guts, grit, determination, yeah, all of that, and then some. Following your dream is much harder than anyone will ever tell you. But is it worth it? Absolutely.

Now we’re officially spinning off a new company, based on something we’re even more insanely passionate and excited about: A travel company for ambitious young professionals. The best part? I got to spend seven months around the world, working from this very laptop, plotting world domination.

No wait, ACTUALLY, the best part is that this travel company is designed to be the launching pad for young people who want to see the world, and go out and do big things. This isn’t a course and there is no curriculum. We simply curate experiences in places like Costa Rica and Nicaragua with other amazing people and inspire the creative environment to let you guys figure out your next big moves.

To return to the “open letter” that inspired this post, yes Daniel, you’re spot on. It is possible to make money doing what you love. It’s just not easy. But when it helps other people figure out their dreams? Then it’s game on.

A version of this post originally appeared on the author’s website.

Matt Wilson is the Co-founder of Under30CEO and Adventurer in Residence at Under30Experiences. To win a free trip to Costa Rica from Under30Experiences, sign up to win today.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.

Check out the 12 Hardest Questions Venture Capitalists Will Ask You.

6 Ways To Cultivate Creativity In Your Company

The startup scene today is an overcrowded space where companies are constantly vying for talent. But hiring talented people is only the first step in cultivating an innovative and creative environment. Building a workplace where there is a constant exchange of ideas involves finding the right formula for your company and culture.

You can’t force creativity, but the right setting will put your team in the right frame of mind to find imaginative solutions. Here are six ideas to help cultivate creativity in your company:

1. Be easygoing.

A relaxed and flexible work environment increases your team’s productivity by letting ideas flow. Encourage an atmosphere where the boss is more likely to make you a coffee than expect you to make them one.

Let go of the traditional 9-5 work week and have team members come in to work when they are rested and at their best. Not everyone is an early bird, and that’s good! Embrace your employees’ natural rhythm — they’ll show up to work fresh and ready to go.

2. Hire for culture.

Look for team members who understand your vision and align with your culture. Having a team that shares one vision and works together helps the organization run smoothly. This doesn’t mean only hiring people who always agree with you, though. Encourage different perspectives — it will help your company stay ahead of the curve.

3. Bring on people who love what they do.

Hire people that are passionate about their work. You want people at your company who really care; people who are excited to go to work everyday because they believe in the product. Adding people that want to improve your product will be the most beneficial for your company.

Point #2 goes hand-in-hand with this one. It’s far more pleasant to work alongside interesting, friendly, and driven people working towards the same goals.

4. Encourage diversity.

Put together a team with different backgrounds, passions, and capabilities. Having a group with a diverse set of ideas and problem-solving approaches helps push your product forward. Embrace and celebrate your team members’ individuality — out-of-the-box ideas and problem-solving approaches help push your product forward.

5. Incorporate sprints

The hustle and bustle of daily office life can wreak havoc on your concentration: emails, phones, meetings — the distractions are endless. That’s where a “sprint,” a set amount of time in which your team works to finish a project, can be the solution.

Startups develop quickly in the early stages because everyday interruptions are at a minimum. When your company has started to grow into individual teams, having them work in a remote location surrounded by nature is a great way to center your focus and take up a project from start to finish.

6. Take ample time off.

Communicate how important taking vacation is. Our brains are constantly on and connected, taking time off for some R&R is crucial for a healthy work/life balance. Wore-down workaholics don’t produce the highest quality content, you want your employees to be fresh and excited to be at work. Convey to your employees how important time off is — and make it non-negotiable.

There are plenty of roadblocks your team will have to overcome to breakthrough in your industry; the company’s work environment shouldn’t be one of them. Reimagine what “work” should look like, and you’ll be surprised at the impact it will have on your team’s energy and creativity. The best takeaway for your employees? They won’t be boxed in by rigid rules and can focus on building the next game-changing feature instead.

What’s your favorite way of breaking the mold?

Christian Springub started his first business at the age of 12 buying and reselling kinder suprise collectible toys at flea markets. Three years later he switched to creating websites for small business in his hometown with Fridtjof. Christian moved to San Francisco in 2011 to build Jimdo in the USA.

Startup Tips: How To Mine Your Customer List For Sales Gold

As a business owner, your biggest potential gold mines are often closer than you think — it’s just a matter of knowing where to look. By going beyond what’s worked in the past and being open to new strategies, you’ll be surprised by how many untapped profit centers are just within your reach.

Uncover Hidden Gold Mines

You already have one major profit source at your fingertips — your customer list. Tap into this often overlooked gold mine by implementing the following strategies:

Reengage lost customers. Most of your customers, clients, or patients don’t stop doing business with you because they’re dissatisfied; more often than not, life gets in the way. In my business, we created a three-step strategy for regaining them (our Customer Re-Engagement Strategy™). This tactic generated over 100 percent increase in sales in less than five days. How? We simply created an email for our client’s list of existing customers, expressed our gratitude for past business, and expressed concern for having not heard from them in a while. We then made a time-limited, preferred customer offer and followed up on that.
Upsell and cross-sell. If customers are offered a complementary product, service, or add-on during the time of purchase, they would happily invest in it. For example, our team helped a client recognize the potential to offer a free, one-month trial for ongoing service and support. Approximately 65 percent of people who purchased the original product agreed to the trial, which added tens of thousands of dollars in additional profits in the subsequent months.
Tag team. Some of the biggest companies in the world owe their success to joint venture partnerships. Look for opportunities to leverage the trust and goodwill you’ve created with your customers, reach out to a company that offers a complementary product, and make that product available to your customers for a share of the profits. When I owned a real estate development company, we did something most of our other competitors were not doing — we struck deals with related businesses to provide “preferential pricing” to our clients. Pairing up with furniture suppliers, security companies, and other related industries resulted in one of the largest profit margins in the industry.

Fix the Leaks

Most entrepreneurs believe the only way to grow a business is by acquiring new customers. Meanwhile, their existing customers are being ignored.

The truth is that your competitors are working every day to win over the hearts of your customers. People want to feel valued, special, and appreciated — if you’re not communicating this to your prospects, they’ll find someone who does. By taking time to engage in an ongoing dialogue with your prospects, offering them valued information, and providing them with incentives to return, you’ll see a better, more consistent flow of income.

Convey Your Value

Choose advertising and lead generation opportunities that make sense for your business, and position your product or service as the obvious choice in your market. In addition, ask for references from your happiest customers. Simply asking for — and rewarding — referrals will engage current customers and instill confidence in new ones.

When it comes to increasing profit centers, the outcome is dependent upon your approach and strategic thinking. Continue to pursue new strategies, seek fresh ways to engage current customers, and capitalize on opportunities to increase the perceived value of your products.

Because when you do strike gold, everyone wins: You’ll experience reduced business costs and increased profits through more efficient operations, and your customers will get exactly the experience they were looking for.

Charles Gaudet’s controversial marketing insight has earned him the title of “The Entrepreneur’s Marketing Champion” by both his clients and Insiders’ for his ability to help them out-compete, out-market and out-earn their competition. As the founder of PredictableProfits.com, he’s an expert at helping entrepreneurs radically improve their profits through a series of effective marketing strategies.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.

Now check out 5 Tips For Young Entrepreneurs Who Want To Be Taken Seriously

12 Tips For Crowdfunding Your New Startup

Choose an Entrepreneur Facing Platform

“Spend some time researching successful projects. You’ll notice that there are core elements of a successful campaign: compelling rewards, a powerful story, and out of the gate support from friends and family. At Fundable, we coach our clients through best practices, and provide them with resources to increase their chance of success. Every entrepreneur should look for that type of support.”

– Eric Corl | President + Co-Founder, Fundable LLC

Read the Fine Print

“Read the fine print of what the future ramifications of fundraising are for your business after taking on crowdfunding. Walk through the different scenarios for future funding and analyze whether crowdfunding your first round will be a turnoff for other potential investors.”

– Abby Ross | Co-Founder & VP Operations, ThinkCERCA

Solve a Problem, Don’t Create One

“When it comes to crowdfunding, the best and most successful ideas come from entrepreneurs that are trying to solve a problem, not create one. If you have a product that will solve a problem that everyone has, you’ll have a good chance of succeeding with your crowdfunding efforts.”

– Derek Johnson | CEO/Founder, Tatango

Understand the Downsides

“Crowdfunding is not a panacea for first-time entrepreneurs. While it can reduce the regulatory burdens of initial capital raising, it comes with downsides. You need to ask yourself whether you want to deal with information requests from 100 shareholders, trying to convince a seed or VC to join that quagmire or the potential of losing your friends’ and families’ savings. ”

– Peter Minton | Founder & President, Minton Law Group, P.C.

Build Momentum First

“Crowdfunding campaigns can become “stale” over time, much like a house that has been on the real estate market for a while loses luster. Make sure to launch your campaign after having folks commit to participate, and then try to schedule a dripfeed of interesting news throughout your campaign. Show momentum — everyone wants to back a winner!”

– Aaron Schwartz | Founder and CEO, Modify Watches

Tap Into the Power of Video

“If you’re looking to crowdfund a new idea I’m going to assume you’ve done your research and have determined it’s a good route to take. Many crowdfunding success stories have said a great video was key to their success. A study by Econsultancy said people are 97% more likely to buy your product after watching a video of it. That’s huge!”

– Natalie MacNeil | Emmy Award Winning Media Entrepreneur, She Takes on the World

Develop a Network of Influencers

“Crowdfunding websites are simply funding platforms. That means you can’t rely on them to market and find funders for your venture. You’ll need to do your own marketing and develop critical mass to get your project funded. Increase your chances of getting crowdfunded by developing a strong network with plenty of influencers.”

– Benjamin Leis | Founder, Sweat EquiTees

Build Your Own Platform Instead

“Follow Lockitron and App.net’s path. They built their own platform to crowdfund, and it worked — so now they don’t have to share a percentage. Lockitron even recently opensourced the code to do so. Check it out here: http://selfstarter.us.”

– Ben Lang | Founder, Mapped In Israel

If You Almost-Build It, They May (Still) Come!

“For physical products, I think crowdfunding presents a unique opportunity to test a market before spending on inventory. That alone is a great reason to build a campaign to sell something that you’re fairly sure the market will love. That said, get as far into the design/build process as possible, so potential customers know you’re serious, and so you identify challenges/costs early.”

– Derek Shanahan | Marketing, Playerize

Plan Your Next Move

“It’s important to have clear plans for how you will use the funds you raise and how you will sustain your success. Be sure that the funds you raise can serve to launch a profitable venture.”

– Lisa Nicole Bell | Founder/CEO, Inspired Life Media Group

Only Raise What You Need

“Despite the big numbers that often grab headlines, most companies don’t need millions of dollars to build a minimum viable prototype (MVP). Spend as little as possible to validate your business idea and then you can attract more capital on better terms. ”

– Robert J. Moore | Co-Founder and CEO, RJMetrics

My Advice? Don’t!

“Your ability to raise money on crowdfunding sites is not correlated in any way to your ability to run a business. If you need outside financing, force yourself to raise money from professional investors — have the door slammed on you a few times! Crowdfunding is “safe,” but a first-time entrepreneur needs to experience hardship, and understand what experienced investors look for in a business.”

– Sunil Rajaraman | CEO/Co-Founder, Scripted.com

So what’s this Everywhereelse.co The Startup Conference?

Startup Tips: 6 Tips For Negotiating Effectively

The word “negotiating” often brings to mind hard-nosed business people in suits stubbornly bidding over the details of a deal. It’s assumed that if one person “wins” the war, someone has to lose. Not so. Business has evolved past the point of needing to be a tug of war between ego-driven people who refuse to lose. Here are six tips for negotiating effectively:

1. People should always come before profits.

Relationships are the currency of influence and success in business. No matter how badly you want the deal or a certain outcome, do not use, manipulate, insult, or demean people to get it. Not only does it create bad energy that will come back to you, it also sets you up to be found out and have people walk away from the deal unhappy. While you can’t control anyone’s opinion of you, you can do everything you can to operate in integrity and treat other people with respect. This is the first and most important rule of negotiating.

2. Know who’s on the other side of the table.

I can’t tell you how many times I’ve sat down to negotiate a deal and had people make all kinds of wild assumptions about me, my company, and my partners. A lack of research on your part says that you either don’t care enough to prepare properly or you’re an amateur who isn’t savvy enough to research the other side.

Take the time to understand who you’re negotiating with – what makes them tick, what that might want in the deal, why they might want what they want, what’s urgent versus important for them. As with sales, the more prepared you are, the more effective you’ll be.

3. Know what you need, want, and would like to have.

Before you arrive at the negotiating table, know what you absolutely cannot compromise and what you’re willing to concede. This prevents the temptation to get caught up in emotions and the desire to reach a conclusion. Even when it’s uncomfortable, it’s important to keep your objectives in the front of your mind and advocate for them.

4. Create leverage.

In many cases, you have advantages in a negotiation that are not obvious to you or the other party. To fully maximize your opportunity, it’s important to think about what advantages you have that make your proposal more desirable for the other party. It could be a strategic partner that the other party wants to work with or it could be a future promise that you could easily fulfill. Keep 2-3 leverage points handy and use them if negotiations begin to stall or go south.

5. Give something meaningful.

The best way to start a negotiation is with a meaningful gift. In his classic book, Influence, Robert Cialdini explains the concept of reciprocation, which says that when we give something to someone, they feel indebted and want to create balance by returning the favor or gift. The reason to give is not to get something in return. The purpose is to set the tone for the negotiation.

If you’re a genuinely kind and generous person, you’ll want to do things that create goodwill. The gift could be something as big as courtside tickets to a sporting event or something as simple as a Starbucks gift card for $10. The gift is less important than the proper motivation and follow-through.

6. Close quickly and gracefully.

If you’re a fan of the ABC television show “Shark Tank”, then you’ve probably witnessed people talking themselves out of deals by not knowing when to stop talking. Going back to point 3, identify a point that’s satisfactory and immediately close. Don’t linger or talk out of nervous energy. Simply state the terms, seek confirmation, and then discuss next steps. Don’t give the other party the chance to change their mind and spend time waffling over inconsequential details. Be clear, be firm, and be progressive.

– – –

Want more advice? Check out Influence by Robert Cialdini and Getting Past No by William Ury – both books are fantastic primers on negotiating and personal selling.

What negotiating strategies do YOU use?

This post originally appeared on the author’s blog.

Lisa Nicole Bell is equal parts artist, businesswoman and motivator. Lisa is the Founder and CEO of Inspired Life Media Group where she and her team meld art, social change, and commerce to create economically viable media properties.

Startup Founder Spotlight: Thomas Kjeldgaard, CEO & Founder, Splashpost

Thomas Kjeldgaard is an online entrepreneur who co-founded Pagemodo, which was acquired by Webs in 2011. Since then, he founded and is the CEO of SplashPost, a tool that helps Facebook Pages turn ‘likes’ into sales. Thomas is publicly known for his conference lectures and addiction to designing UI and UX.

Who is your hero?

Steve Jobs.

What’s the single best piece of business advice that helped shape who you are as an entrepreneur today, and why?

Develop something that you can sell over and over again. Create a business that is not dependent on you!

What’s the biggest mistake you ever made in your business, and what did you learn from it that others can learn from too?

Holding back with marketing. Marketing starts day one. As soon the idea is on the table the marketing process starts — not when the product is ready!

What do you do during the first hour of your business day and why?

First, I get an overview of the day and handle any crucial user issues. Customer service is crucial to success and many businesses don’t realize that.

What’s your best financial or cash-flow related tip for entrepreneurs just getting started?

Develop something scalable based on a recurring subscription model. This puts money in your pocket each month = cash flow.

Quick: What’s ONE thing you recommend ALL aspiring or current entrepreneurs do right now to take their biz to the next level?

Focus. Track everything in your business to know where you make money and what costs you money. Understanding your users and customers is crucial for success.

What’s your definition of success? How will you know when you’ve finally “succeeded” in your business?

When users tell you they are happy with your product, you know you are making a positive difference in their life. They will then be happy to pay you — and if you’re lucky, you make a nice exit from your company and cash in on that.

The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world’s most promising young entrepreneurs. In partnership with Citi, the YEC recently launched #StartupLab , a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses via live video chats, an expert content library and email lessons.

What is everywhereelse.co The Startup Conference?

Founder Spotlight: Miguel Ramirez, CEO Soccerly.com

Miguel Ramirez is a serial entrepreneur who co-founded mediotiempo.com, the largest sports site in Mexico and one of the most relevant Internet success stories in Latin America. The company was acquired in 2010 by Time Warner. Today, Miguel is co-founder and CEO of soccerly.com, which was launched in January 2013 with the ambitious plan of becoming “the online destination for soccer fans in the U.S.” Miguel is also a partner at kiwilimon.com, a leading food/community site. Follow him @mrlombana.

Who is your hero?

My grandpa.

What’s the single best piece of business advice that helped shape who you are as an entrepreneur today, and why?

It is important to be humble. Always remember the day you started and where you come from; no matter how successful you become, it is important to have both feet on the ground and keep on working hard at all times. Successes and failures are just life episodes and should not change the way you act.

Also, being a good listener is a must — be close to your team and think of them as family, not employees.

What’s the biggest mistake you ever made in your business, and what did you learn from it that others can learn from too?

One of the biggest mistakes I remember making is when my partners and I decided to sell our stake in a company because at that point, we did not have the necessary time to devote to it; even though we did consider several options, I guess we were not wise enough to make the best decision. At the end, it not only cost us money but also a good opportunity for the future that we regret today.

We should have asked for advice from other people (mentors, family, etc.) — that might have had helped us to act in a different way, but unfortunately we didn’t. But every learning experience is valuable, and without mistakes there are no successes.

What do you do during the first hour of your business day and why?

I check my agenda and my “to dos” to set the best road map for the day. I like to be well-organized and do as many things as possible every day, as the following day is always loaded with new stuff and more unexpected things. It is essential to have an organized way to work in order to achieve tasks and objectives.

Define your priorities and never leave for tomorrow what you could do today.

What’s your best financial or cash-flow related tip for entrepreneurs just getting started?

Resources are always scarce, and it is always easier spending than saving. Focus only on those things that will bring you to the next level and cut unnecessary expenditures — even if they’re minimal, they could hurt you in the long run. The best of you is always there, within you, so use your brain first and then your wallet.

Quick: What’s ONE thing you recommend ALL aspiring or current entrepreneurs do right now to take their biz to the next level?

Work only with the right partners. Take whatever time you need to be 100 percent convinced of the partners you are bringing to a venture; work only with people that add value, balance and commitment.

What’s your definition of success? How will you know when you’ve finally “succeeded” in your business?

Success is not only about money. It’s about achieving personal goals, fulfilling society’s needs, generating employment for lots of people, making users happy and seeing others using your product; when most of these “achievements” are done, you will be happy and can toast your success.

Beware the ill planned innovative rollout.

4 Startup Lessons You Won’t Learn In Business School

My co-founder and I both attended Wharton as undergrads, where we “concentrated” in entrepreneurship (in addition to finance, accounting, legal studies and philosophy). We wrote multiple business plans, negotiated the details of term sheets and collaborated on teams vying for theoretical capital within the confines of a semester.

While the skills learned no doubt gave us perspective and provided a structure for entrepreneurial thinking, after two-plus years of living a startup, it’s become apparent to me that studying entrepreneurship was just as abstract — if not more so! — than my studies in philosophy, especially with respect to starting and building a bootstrapped company.

The lessons outlined below may not be as sexy as term sheet negotiation and capital raising, but they are core to the success of a resource-constrained startup — and make a world of difference between success and failure:

1. Learn how to sell, quickly.

You need to be profitable from day one, and consequently, you need to think about what you’re building as a sustainably profitable venture with a real business model. You do have investors, but they’re your clients, and they’re not giving you money because of an impressive management team, large addressable market, previous accomplishments, or world-scale strategy.

They care only about your ability to address their specific needs in a better way than the current solution. Can you fix their problem? They don’t care about anyone else’s.

2. Learn how to build relationships.

You may be without financial or strategic advisors, but no one understands the problem that you’re trying to solve better than the customers you’re courting. Your first set of customers will effectively become your advisors and most valuable advocates, providing deeper insight into the issues you’re trying to solve and giving you a better grasp of customer needs.

Your first 10, 50 and 100 clients will define your brand and help you shape your business, so make sure you listen to them vs. trying to expand too rapidly. Better insight and understanding of your customers in the beginning is key to setting your business in the right direction.

3. Learn how to engage client referrals and leverage the media.

You may not have the budget for marketing programs, but even if you do, there’s nothing better than a referral from a satisfied customer. Word-of-mouth marketing from current customers creates a trusted network that results in a supportive, invested client ecosystem.

With regards to PR, take the opportunity to engage writers directly with your story. It means a lot to a writer when they receive a custom note from a founder instead of a templated message from a PR firm or marketing rep.

4. Understand the scope of what you’re embarking on — and the significance of determination and perseverance.

This is where our traditional entrepreneurship curriculum failed most fundamentally. Successful entrepreneurship rarely happens within the confines of a year, let alone a single semester, and our half-hearted attempts at starting businesses every semester (only to let them die at winter and summer breaks) reinforced a misleading expectation: that success can be validated quickly.

Building a successful company takes time and patience, two assets that you can’t raise from any venture capitalist. Yes, capital can help you hire and attract resources, but in the early stages of a startup, doing all the work yourself will provide you with perspective on the full scope of what you’re building.

Being in control of your own destiny also uniquely allows you to go at your own pace. While you obviously need to be aware of market pressures, without the pressure from outside investors, you can take the time to better lay the foundation of your business — a foundation that, one day, might support an empire.

Zach Yungst is the Co-founder of Cater2.me, a company founded in late 2010 focused on revamping the corporate catering industry. Zach grew up in Sarasota, Florida and graduated with degrees in Finance and Philosophy from Wharton / The University of Pennsylvania. Post graduation, Zach worked in investment banking at Morgan Stanley in New York and in private equity for TPG in San Francisco.

Quick tip, this can be a fundraising deal breaker.

Startup Tips: How To Know When You Need A Contract

Do you sometimes lie awake at night wondering what will happen if your biggest customer doesn’t pay you? How about if the vendor handling your website upgrade takes off with your thousand-dollar down payment? These scenarios would be a nightmare for any bootstrapping entrepreneur — and they happen all the time.

The Problem

Here’s a pretty typical scenario. One of my clients, who owns an Internet-based consulting firm, was hired to create a new website for a client a few months back. He received a $500 deposit for several thousands of dollars worth of work. Then he hired a web coder, with whom he had a good relationship, to handle certain aspects of the design. He and the coder completed the work, and guess what happened next?

The client stiffed him. And not only him, but also his colleague, because he didn’t have the money to pay the web coder out of his own pocket. This caused a strain in the relationship between the consultant and his coder, and a major strain on his pockets.

Several months later, the consultant hired me and I used my magical lawyer ways to collect all of the money from the client. (Note: magical lawyer ways = calling the client, announcing that I am a lawyer and demanding payment. Okay, okay, it was more complicated than that but, most importantly, it worked). He was happy to get fully paid, but the strain on the relationship could not be erased, he lost the time value of the money he was paid in January instead of August, he spent a lot of time chasing this guy instead of working on other projects, and he was out the attorney’s fees he had spent, too.

The Solution

How would this scenario have been different if the consultant had a contract for both relationships? First of all, in his initial strategy session with me, I would have advised him that his payment collection method wasn’t working and we would have set up a better payment system. Additionally, the client contract would have required the client to pay interest on late payments and court fees plus attorney’s fees if he wound up having to take him to court. This makes it really easy to sue and win.

With such a contract, the chances of getting an enforceable judgment (read: getting paid) jump sky-high — and it won’t cost you money, since the client has to pay your lawyer’s fees.

The lesson? When you show clients that you are professional and serious about your business, they will think twice before trying to stiff you.

Regarding his relationship with the developer, an independent contractor agreement that stated that the coder would get paid when the business owner gets paid would have eliminated the bad blood between the parties.

So, Do You Need a Contract?

I often tell my clients, “Everyone is an enemy to your business!” Your business partners, customers, vendors, employees, etc. all have the ability to screw your business over. So you have to treat everyone (and I mean EVERYONE) like an enemy on paper. Only then are you free to treat them like a friend in person.

How do you do that? By having a contract for every relationship your business enters into.

Here’s my rule of thumb that will protect your business from all manner of headaches, financial loss, emotional distress and yes, lawsuits as well: Have a contract for every single relationship your business enters into. You and your buddy starting a new business? Create a contract that governs that relationship. Selling your new widgets in that new widget store up the street? Draft an agreement between you and the widget store owner. Setting up a website to advertise and/or sell your services? Have a privacy policy and/or terms and conditions to govern your relationship with people who check out your website.

These contracts do not have to be complicated. In fact, they can be pretty simple, but they do need to protect you from all (or at least most) of the ways the relationship can go wrong. And please don’t forget the all-important boilerplate at the end of the contract, because it provides lots of protection and will save you money, time and headaches.

Once you have an agreement with your independent contractors, vendors, clients and business partners, you can go back to getting enough sleep at night because you know you’re well-protected in any situation.

Note: This article is a resource guide for educational and informational purposes only and should not take the place of hiring an attorney. No information in this article creates an attorney-client relationship between the author and the reader.

A version of this post originally appeared on the author’s blog.

Rachel Rodgers is a business lawyer for women and/or young entrepreneurs. She runs her practice, Rachel Rodgers Law Office, entirely online. In addition to practicing law, Rachel blogs about virtual law offices and teaches a popular workshop for women lawyers who want to practice law online through her website, Her Virtual Law Office.

Now check out these startup marketing tips from everywhere else.

Top Resources For Understanding Startup Funding

It’s no secret that many activist investors are frustrated with the lack of financial literacy among entrepreneurs today. In my own battle against the blank face in the boardroom, I’ve been following the work of Brad Feld, Jason Mendelson, and Fred Wilson (in addition to asking some of our great investors questions directly).

Some of these online works can be a little overwhelming, however, with Fred Wilson’s MBA Mondays alone returning over 90 posts. Here are a few places to get started — followed by some additional resources I’ve found useful.

Brad Feld’s Finance Fridays

Brad’s professorial writing style explains the context around numerous accounting mechanisms and why they matter. Brad will get you thinking about the big picture before you dive into vocabulary.

Select Picks:

Jason Mendelson’s Convertible Debt Series

Convertible debt (and convertible equity) is popular for seed stage companies in Silicon Valley. Jason’s series will help you get comfortable with the levers behind most seed stage negotiations.

Select Picks:

Brad Feld’s Term Sheet Tips

Don’t forget to plan for success! Get familiar with what a term sheet looks like before you get one.

Select Picks:

Fred Wilson’s MBA Mondays

Fred’s posts are among my favorite. Not only does he share concrete examples, he uses simple terms to get you familiar with almost every major financial metric that will have an impact on your business. I even printed Fred’s posts and annotated them rigorously until I understood how everything fit together.

Select Picks:

Additional Resources:

This post originally appeared on the author’s blog.

Tyler Arnold is Co-Founder and CEO of SimplySocial Inc., a software tool that helps large companies create great content for their social media profiles. As CEO, Tyler assists with key accounts, business development, and talent acquisitions as SimplySocial grows its presence around the world.

Now read 12 of the hardest questions venture capitalists will ask you

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10 Great Productivity Apps For Entrepreneurs

Getting more done throughout your day isn’t simply a matter of sitting down and working harder. Instead, being more productive requires that you work harder on the right things, in addition to tackling them as efficiently as possible. Fortunately for entrepreneurs, there are plenty of apps out there that will help to both organize an overwhelming workload and provide the motivation needed to get things done.

The following are 10 of my favorites:

Evernote: The beauty of Evernote (which is available for free in Web, iOS and Android versions) is that it can be whatever you need it to be. Need a simple place to store notes or track thoughts as they occur? Evernote has you covered. Want to set up a complete David Allen-style “Getting Things Done (GTD)” environment inside the program? Evernote can do that too.
Dropbox: As with Evernote, it probably isn’t a surprise to see Dropbox on a list of recommended productivity apps. The program’s value has been pretty well-established, all though chances are good that, even if you do have this program installed on your computer or mobile device, you still aren’t getting as much out of it as you could. To expand your usage, check out Macworld’s article on “62 Things You Can Do With Dropbox” (many of which work no matter what platform you’re using).
Lastpass: In an age of digital insecurity, forming secure passwords is an absolute must – but who has time to remember all those different combinations of letters and numbers? If you struggle to keep your online accounts secure, Lastpass can help by generating, storing and automatically recalling strong passwords for all of your Internet logins. It’s free to use on both PCs and Macs, though you’ll pay $12/year to have the premium version available for download to your mobile device.
Remember the Milk: Remember the Milk (RTM) is a widely-used to-do list management program that’s worth a look if you’re having trouble tracking your tasks. It’s highly flexible and easily customized – and can even be used to implement a GTD-style system. The Web version and basic iOS and Android apps are free to use, though daily syncing will run you $25/year.
Wunderlist: If RTM lacks in any one area, it’s visual appeal. So if you’re a more graphically-inclined entrepreneur, take a look at Wunderlist – a perpetual favorite on lists of the best “to do” trackers. The program is easy to navigate and can be used to quickly and efficiently track important tasks from within its free desktop, Web, iOS and Android versions.
Things: Although Things is only available on Macs and within Apple devices, it still warrants a mention on this list, given how intuitive the program is to use. While some users find that the RTM interface has a learning curve to fully utilize, Things makes it easy to start tracking “to do” items as quickly as possible. And, as an added bonus, it’s totally free to use!
Instapaper: Coming across interesting articles is one of the best parts of the Internet – and one of the worst things for your overall productivity levels. Instead of reading through new posts whenever you encounter them, save them to your Instapaper account. Your selected Web pages will be automatically saved for later browsing, when they’ll be displayed in a reading-friendly format for free on your computer, iPhone, iPad or Kindle.
Yast: Nearly all professionals can benefit from some type of time-tracking program – whether this type of tool is used to report billable hours back to customers or to simply measure how working hours are being spent. Yast provides an incredibly easy-to-use solution (just press the “Play” button to start tracking time to a specific account) that’s free to use for personal time tracking. Business accounts for entire teams are available as well, starting at $14/user per month.
Focusbooster: Plenty of entrepreneurs use the Pomodoro Technique (which alternates 25-minute long working blocks with short breaks) in order to maintain sustainable, long-term productivity. And while there are plenty of different Pomodoro timers out there, one of my favorites is the Focusbooster App. It’s free to use and provides a simple way for business professionals to stay focused over long periods of time.
Leech Block: If you find that the Pomodoro Technique alone isn’t enough to maintain productivity (which – let’s face it – isn’t that much of a challenge in today’s digital world of easily-accessible distractions), you may need to call in the big guns. In this case, you need Leech Block – a Firefox add-on that allows you to lock down specified websites. It’s easily customized to suit your unique working habits, and even provides a helpful reminder to get back to work when you stray to one of your blocked sites.

These are just a few of my favorite productivity apps. If you have others that you couldn’t get through the work day without, share your recommendations below!

Sujan Patel is the founder and CEO of Single Grain, one of the top Digital Marketing agencies in San Francisco, CA. With more than 10 years of Internet marketing experience, Sujan leads the digital marketing strategy for companies like Sales Force, Yahoo, Intuit and many other Fortune 500 caliber companies.

12 Of The Hardest Questions Venture Capitalists Will Ask You

What Is Your Hole?

“The classic VC role is that of an interrogator, trying to break you for a key secret. But it doesn’t have to be that way. Folks who watch the TV show “Shark Tank” know this feeling. Time after time, a well-rehearsed entrepreneur goes through his pitch, and everyone loves it. But the Sharks (VCs) keep poking at the startup until they finally find a hole. Maybe the company has zero revenue, a poor growth strategy or a weak CEO. Know your weaknesses better than your strengths. Before our first VC meetings, my team sat down and asked each other “gotcha” questions until we were all experts.”

– Neil Thanedar | CEO and Founder, LabDoor

How Are You Different?

“With proper due diligence and competitive analysis, you should be able to make a case for how you differ from other folks in the marketplace. How can you prove that you have a truly unique value proposition? What is it about your offering, your approach, your technology and your team that makes your company able to achieve and execute on this opportunity? ”

– David Ehrenberg | Chief Financial Officer, Early Growth Financial Services

How Much Is Your Company Valued at?

“The reason why determining the valuation of your company is so difficult is because there is no right answer. On the one hand, you need to be realistic, but on the other hand, you do not want to undervalue your company, as the VC may think something is wrong. The best way to handle this question, and most others that arise when negotiating with a VC, is to do all you can to have several VCs interested in your company. Like in most negotiations, if you have several interested parties, they may bid against each other, which will allow you to obtain the best terms for you and your company.”

– Doug Bend | Founder/Small Business & Startup Attorney, Bend Law Group, PC

What’s Your Customer Acquisition Cost?

“The best way to tackle this question is to show reasonable estimates for customer acquisition, using well-researched numbers and reasonable conversion rates. If you can’t explain how you are going to acquire customers for less than what you sell them on average, at a fundamental level, you have failed to explain your business.”

– Patrick Curtis | Chief Monkey and Founder, WallStreetOasis.com

When Are You Paying Me Back?

“There are many entrepreneurs with amazing ideas. Ideas are a dime a dozen, but execution is everything. Every investor will ask you when and how he will recoup his investment. What experience do you have? What is your track record? Before going into a meeting with a VC, make sure to tell him about your experience, your track record and, most importantly, how you will recoup his money. Lots of people pitch the idea before the finances. Pitch the finances and how the VC will make money; if he asks you a question, then you got him to bite — now it’s all about your elevator pitch. ”

– Ak Kurji | Chairman & CEO, Gennex Group

Why Won’t a Huge Corporation Build Something Like This?

“VCs will ask, “Why won’t a huge corporation build something like this and use their existing customer base and capital to capture market share?” The best way to defend against this is to have technology and intellectual capital that the company will want to acquire, rather than destroy. ”

– Matt Wilson | Co-founder, Under30Media

Why Hasn’t This Worked Before?

“Zaarly raised $14.1 million in a Series A in fall of 2011. But it was a question earlier that spring from Marc Andreessen in our pitch meeting that gave our founding team the most pause, “Why do you think this hasn’t worked in the past?” We didn’t have a great answer — more of a hunch really that mobile technology didn’t exist to allow distribution of information in real time previously. But the question forced us to examine our predecessors who had tried and failed to learn what landmines to avoid. Our lesson: Know your landscape and learn from prior failures and success. ”

– Eric Koester | Founder, Zaarly

How Do You Define Success for Yourself and Your Company?

“VCs want to invest in founders who are dedicated to “hitting a home run.” If you’re satisfied with building a small company, that’s a big red flag for VCs. As we’ve all heard, a number of founders have said yes to exits their VCs wanted them to say no to. Other founders have taken the middle ground by cashing out some of their shares to secure their personal finances, and then continued to go big. Either way, VCs want to invest in founders who are focused on a disruptive, game-changing product/idea. This is a vital point to keep in mind as you consider whether funding is right for you.”

– Mitch Gordon | CEO/ Co-Founder, Go Overseas

Do You Know [Insert Company]? Why Not?

“Anytime a VC throws out the name of a potential competitor that you don’t know or haven’t looked into, it can throw you off balance for a minute. The fact is, it may be a company that you don’t think is a viable competitor, so you don’t know much about it. The best way to tackle it: Tell them the truth, “We looked at our key competitors and that company did not meet the criteria. But we’ll look into it further after this meeting.” The key is to maintain control of the conversation because it shows you can handle a curveball. ”

– Benish Shah | Co-Founder/CEO, Vicaire Ny

What Is Your Plan To Grow?

“The most difficult thing to explain to an investor is your plan to grow. They want to know how you’ll outdo everything you’ve already done. Prep by picturing your future: What staffing or product creation will help you have the business you want to have?”

– Brian Moran | Founder/ Director of Online Sales, Get 10,000 Fans

Why Haven’t You Gotten Traction?

“The best way to handle that question is by not approaching VCs until you have achieved traction. Venture capital should be looked at as an accelerator for existing success, not as a runway extender to get it right.”

– Brent Beshore | Owner/CEO, AdVentures

Debt or Equity?

“Many investors will know going into a deal whether they want preferred stock or a convertible note. Sometimes, however, they will leave it up to the company. Angel investors, in particular are likely to leave it up to the company as the more sophisticated party. For the company, this is an opportunity to maximize the value of the investment, but they must also be wary of getting off on the wrong foot with the investor by being overly aggressive or appearing uninformed. A crash course in VC deals and a good deal lawyer will make sure you maximize the former and mitigate the latter. ”

– Peter Minton | Founder & President, Minton Law Group, P.C

Now check out Fred Wilson’s Venture Capital Do’s And Dont’s

Startup Founder Spotlight: Alex Schiff, FetchNotes

Alex Schiff is the founder and chief executive officer of Fetchnotes, which makes productivity as simple as a tweet. Prior to Fetchnotes, Alex was the vice president of Benzinga and a student at the University of Michigan’s Ross School of Business. Follow him @alexschiff.

Who is your hero?

Aaron Patzer is one of the entrepreneurs I look up to most.

What’s the single best piece of business advice that helped shape who you are as an entrepreneur today, and why?

Optimize for speed, not cost. Your entire organization should be structured around how you can accelerate progress and learning. That $20 a month here or $50 there is NOT going to mean anything in the grand scheme of things, but if it frees up a few hours of your life, then it’s worth it.

What’s the biggest mistake you ever made in your business, and what did you learn from it that others can learn from too?

Not focusing on one thing. At one point, I was working on three startups, working for another, and still in school full-time. They all suffered from my lack of attention. I learned that when you’re a founder you need to be thinking not “What do I need to do today?” but “What can I be doing to advance my business forward?”

The former has a finite amount of work; the latter is limitless.

What do you do during the first hour of your business day and why?

I take care of all the little things. Respond to email, complete quick tasks, etc. I actually purposefully put off anything that will take more than 30 minutes until after lunch because then I know I have the longest period of uninterrupted activity.

What’s your best financial or cash-flow related tip for entrepreneurs just getting started?

You can make money in weird ways. We offered to sing karaoke to any of our users who donated money.

Quick: What’s ONE thing you recommend ALL aspiring or current entrepreneurs do right now to take their biz to the next level?

The best part about being an entrepreneur is that you get to choose who you work with — don’t take that for granted!

What’s your definition of success? How will you know when you’ve finally “succeeded” in your business?

Honestly, I have no idea. There will always be a new mountain to climb.

Check out Alex’s guest post, Here’s A Better Way To Ask For An Email Introduction.

Startups Here’s A Better Way To Ask For An Email Introduction

I ask for and receive a lot of requests for introductions. Whether it’s someone at a company looking for a partnership or job, an investor, a journalist, or someone else, it’s an integral part of pretty much any profession. At the same time, such requests often arise in the least efficient way possible for the middleman: in person, in the middle of another email exchange talking about the other party, or simply with no details at all.

Once I got involved in the startup scene with Fetchnotes, I found that the startup crowd has email introductions down to an exact science. I’m sure similar rules apply outside our bubble, but inside it there are a very specific set of expectations, and it was a bit cryptic and counterintuitive to pick up at first. But hopefully this helps you maximize the success of your introduction requests.

First of all, no matter where the request for an intro arises, always send a separate request email. That way, the receiving party can act on it directly (since most intros are over email). You’re asking someone to spend their social capital on you, so your number one goal is make it as easy as possible. Here’s how:

—

Hey Alex,

Hope all is well! I saw you’re connected to Mark Zuckerberg (contact) on LinkedIn. I was hoping to connect with him about a partnership (reason), the details of which are below. Do you know him well enough to make an intro (gives middle-man a way out in case they don’t know each other well)?

StartupWithFriends is an awesome new app that lets you start a company with your friends, right on Facebook (what you do). We have 150K+ active users, and on average they’re starting 1,000 companies per day (credibility + traction). We’ve been integrating with OpenGraph already (shows you’ve done work already, otherwise they often point you to their API page) but we think that we can make it a huge revenue driver for them if we get access to some of the data not available in their APIs, specifically the number of times a user looks at the profiles of their ex-girlfriends (basic benefits + needs outlined).

Let me know if you can make the connection. If not, no worries, I can reach out cold (shows them you have confidence that this is going to happen one way or another).

Thanks!
Networker McAwesome

—

When I receive an email like this, I forward it to my contact and ask, “Hey, these guys were looking to connect. Can I make an intro?” If he says yes, I make the connection. If not, I say I tried but he doesn’t want to talk. Unless you know someone really well (or know they are looking for such opportunities), you want to give them a chance to say no. Otherwise, they’ll feel obligated to take it and have bad feelings toward the person from Day 1. Not only is it just good etiquette to give them a choice, but it prevents the value of your introduction from being diluted too.

Is it contrived? Obviously. Does the other party realize its contrived? Usually. And yet I write every email intro request in this exact format because it does three really, really important things:

Makes it easy for the middleman to make the intro (just hit forward and type a sentence)
Gives the person you’re trying to get connected with a basic overview (so they feel more comfortable taking a meeting)
Limits the amount of aggregate back-and-forth.

That makes the intro more likely to happen, the person you’re trying to meet more likely to take the meeting, and most of all, makes the most efficient use of everyone’s time.

Happy connecting!

This post originally appeared on the author’s blog.

Check out our interview with FetchNotes here at nibletz.com The Voice Of Startups Everywhere Else