Randy Weber

Why Early-Stage Investors Should be Pumping Up Their Startups with Data

Posted on May 26, 2012 and filed under Start-ups.

Why early-stage investors should be pumping up their startups with data

Jeb Stone posted some great insights on Venture Beat about why startups should be competing on data and how their investors can help.

What if VCs provided centralized analytics and data management resources as part of their investment in startups? Giving startups the tools and resources they need to compete on analytics would give investment firms and their startups a huge competitive advantage. Startups would grow revenue faster, reducing their level of technology debt, and giving them access to specialized skillsets typically available only to better-funded players. Investors would see a significantly enhanced probability of return.

Check it out. It’s well worth the read.

[Top image credit: Zurijeta/Shutterstock]

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Get Results by Listening with Intent

Posted on May 16, 2012 and filed under Business Development,Communications,Leadership.

listen with intent

Leadership expert Art Petty shares some tips on listening with intent. “Listening with intent isn’t a technique, it’s a personal value backed by behaviors that cause us to shift from the movie about ourselves running in our own minds to focusing on the movie or picture being created by another.” When we understand the needs and motivations of others, we are in a much better position to meet those needs.

Petty notes that:

Great negotiators…strive to understand issues, goals and aspirations, which are often hiding out of sight behind positions.
The best salespeople…sell by…seeing the world and challenges and needs from our frame of reference.
Great strategists listen to customers and markets…[looking] for emerging patterns and [striving] to make sense of those patterns…They adapt their firms and products and services to fit the patterns…
… the best leaders strive to tune-in to their employees, particularly as it relates to professional development.

Bottom Line: You cannot get what you want if you cannot give someone what they want. And you can’t give someone what they want if you don’t know what that is. So listen.

Image: Michal Marcol / FreeDigitalPhotos.net

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What Is Business Development?

Posted on April 28, 2012 and filed under Business Development.

What is business development?

Not enough companies engage in genuine business development activities. So it’s no surprise that I’m often asked the question “what is business development?” It’s one of those things that most people have never had any involvement with and really have no idea what it is. The question mostly comes up at social events or when I meet with new employees from other departments. I’ve had to explain it 3 times this week.

It doesn’t help that a lot of companies like to use the terms business development and sales synonymously. So I always start with “business development is not sales.”

The next thing I do is point people to a great resource by Seth Godin on Understanding Business Development. Then I engage the person in a discussion about how this specifically relates to our business. By the time we’re done, most people get it.

Seth’s post provides an overview of what constitutes business development, how business development can positively impact a business, what a good business development deal looks like, and what makes a good business development person. Some highlights include:

…Good business development allows businesses to profit by doing something that is tangential to their core mission. Sometimes the profit is so good, it becomes part of their core mission, other times it supports the brand and sometimes it just makes money…

Examples:

Starbucks licenses their name to a maker of ice cream and generates millions in royalties…

Best Buy offers extended warranties on appliances you buy. They don’t provide the warranty, of course, a business development person did a deal with an insurance/service company to do it and they share the profit.

The Princeton Review built a huge test prep business, but only by licensing their brand to a series of books which did the lion’s share of their marketing for them.

…[Often smaller companies] are so focused on their core business that it never occurs to them to consider partnerships… Harley Davidson probably makes more money on business development than they make on motorcycles.

The thing that makes business development fascinating is that the best deals have never been done before. There’s no template, no cookie cutter grind it out approach to making it work. This is why most organizations are so astonishingly bad at it…

If you’ve ever pitched a product or service to a business, you know how soul-deadening it can be. The buyer works hard to make it clear that she’s doing you a favor, and you need every dog and every pony available at all times (and you better be the cheapest). But business development doesn’t have this dichotomy. Both sides are buying, both sides are selling…

Business development people are exploring the unknown. That means that there’s more than cash on the table, there’s bravery and initiative and excitement. The best business development people I’ve ever worked with are able to capture the energy in the room and amplify it…

The thing that I always add to Seth’s comments about what makes a good business development person is the necessity to have a vision of what can be and the ability to sell that vision both internally to senior management and externally to potential partners. This isn’t easy to do and few do it well.

Bottom Line: More businesses should embrace business development. It can create significant value in ways previously unimagined. It takes someone with vision, the ability to sell that vision, and the leadership and persistence to execute that vision in order to realize these gains.

Header Image: nokhoog_buchachon / FreeDigitalPhotos.net

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Decentralized vs Centralized Analytics Function – I Never Thought About It

Posted on April 23, 2012 and filed under Business Development,Leadership,Marketing,Product Management.

Jeb Stone (the smartest guy I know) makes some great points in his most recent post - Centralized vs Decentralized Analytics: All You Need To Know. I'm a firm believer in the value of analytics. But I never really thought about whether the function should be centralized or not. Who wouldn't want to have their own dedicated analyst? But Jeb makes a great point about how this is a bad arrangement from a career progression perspective and the resulting impact that has on the analyst's tenure. He writes:

From an organizational cost perspective, here’s perhaps the biggest argument against a decentralized Analytics organization: In a decentralized organization, there is no tangible career path for most analysts...

...Without a career path, your analysts are highly incented to learn in-demand technology on your dime — whether or not your organization has a need for it — and then jump ship to an employer who will compensate them for that skill. Perhaps even more to the point: rock-star analysts will avoid employers with a decentralized Analytics function, because they know it’ll take them longer to come up to speed and that there is likely no performance incentive program specific to their accomplishments.

...After my second year in my first “big” job, I remember thinking: “Man, I didn’t know anything a year ago.” At the end of my fourth year, I remember thinking: “It really takes two years to get an analyst up to full competence.” I’ve frequently seen an argument that decentralized analysts have a deeper knowledge of their specific line of business. I can’t give a lot of credence to that argument, specifically because line-of-business analysts are likely to leave the job around the time they become fully competent, leaving the line of business to backfill with a novice.

I've seen this exact thing happen multiple times. All the decentralized analytics guys I've worked with have left in under 2 years. The guys in the centralized analytics group (at the same company no less) are all still there, still learning new skills, and still adding increasing value to the business.

As a business development and product management guy, I can attest that having access to analytics guys that really understand the business is a huge asset and makes it much easier for me to create successful partnerships and products.

Header Image: jscreationzs / FreeDigitalPhotos.net

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Understanding E-Mail Psychology to Write an Effective Partnership Pitch

Posted on April 21, 2012 and filed under Business Development,Communications,e-mail.

When pitching a potential partner via e-mail there are a lot of factors to consider. For purposes of this discussion, we’re going to assume that you’ve already properly researched your prospect and know that what you have to offer will deliver value. The trick is how to communicate this value to the prospect and get to the discussion going. Think Simple Now shares some thoughts on the psychology of e-mail that are helpful for anyone in business development trying craft that perfect partnership pitch e-mail.

From the post:

Generally speaking, the sender and receiver see things from drastically different points of views. And from the perspective of a sender, we often do not spend time understanding who the receiver is and what their inbox might look like…

Observing the Receiver

Gets a lot of email…

Regularly gets asked a standard set of questions and favors…

Does not have a lot of free time.

Observing the Sender

Spends a long time crafting the ‘perfect’ (-ly long) email.

Believes that their request is original, unique, and special.

Believes that they are the first to ask for such favors.

Cannot imagine why anyone would turn them away.

Desires to tell the whole story, explained from every angle, so that the listener can understand their point of view.

Based on these observations, the take-aways from the post for the sender are:

Quickly answering – “What’s the Point?”
Clearly stating benefits – “What’s in it for me?”
Keeping in mind the outcome – “What do you want me to do?”
Sticking to the facts
Trimming words

To illustrate these concepts, I’ve included a sample partnership pitch I’ve successfully used multiple times via Linkedin.

Randy Weber - sample partnership pitch e-mail

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The 29 Most Important Words for Leaders

Posted on April 21, 2012 and filed under Communications,Leadership.

Terry Starbucker shares great tips on leadership and communications. Here he share’s the 29 most important words for leaders.

The 7 most important words:
“I don’t know, but I’ll find out.”

The 6 most important words:
“I admit I made a mistake.”

The 5 most important words:
“You did a great job!”

The 4 most important words:
“What do you think?”

The 3 most important words:
“If you please …”

The 2 most important words:
“Thank you.”

The 1 most important word:
“We.”

The 1 least important word:
“I.”

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Eric Guilleminault Launches Off the Grid Fitness, a Green Gym

Posted on April 14, 2012 and filed under Start-ups.

I love entrepreneurs and start-ups. I workout regularly to stay fit. And I try to go green whenever possible. That’s why I think my friend Eric’s new venture is so cool. Eric has started the first “green” gym in Arizona – Off the Grid Fitness. Located in Scottsdale, AZ, Eric has created something truly unique that makes a difference in both health and the environment.

Here’s how Eric describes his business:

At Off The Grid Fitness, being “green” means producing energy as well as conserving it. Our exercise equipment converts the energy you produce, your “sweat-equity,” into energy that can be returned to the grid. Other exercise equipment is self-powered, with muscle power replacing power from the grid.

Cool features include:

Ellipticals and exercise bikes that produce electricity when used that can be returned to the power grid
Self-powered treadmills that require no electricity to run
Bamboo floors in the group exercise room because bamboo trees grow back faster than any other kind of tree
Recycled rubber flooring in the workout area
Recycled workout equipment
Compact fluorescent lights which are more energy efficient than traditional fluorescent lights
A water fountain that shows how many plastic bottles you have saved by refilling your water bottle, instead of using disposable ones

Besides just creating a cool business, he’s done a great job creating buzz for it. Check out this list:

I met Eric Guilleminault when he was responsible for acquiring new members for MyPoints.com. Eric is a smart guy. He has an MBA from Thunderbird. He’s also a former college basketball player and personal fitness trainer/instructor. He even did a stint as a business process consultant. He knows the in’s and out’s of running and marketing a business, as well as the fitness aspect. I’m sure Off the Grid Fitness is going to be a huge success for Eric.

If you’re in Scottsdale, AZ you should check out Off the Grid Fitness.

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RetailMeNot Partners with CardSpring to Disrupt the Coupon Space

Posted on April 10, 2012 and filed under Business Development,Product Management.

coupons

I work in the loyalty space. I’m also a big user of loyalty programs. This thrilled me – RetailMeNot Could Shred The Paper Coupon Biz With Credit Card-Integrated On and Offline Discounts (via Techcrunch). From the post:

…RetailMeNot is planning a roll out of its paperless credit card-linked coupons this summer with several nation-wide retailers…

…The CardSpring-API backed feature could be massively disruptive because it’s so much easier and less embarrassing than cutting and redeeming traditional offline coupons. It’s also great for merchants, since rather than paying to print coupons, businesses only pay RetailMeNot a commission when discounts are redeemed…

…You’ll occasionally visit RetailMeNot via web or mobile to search or browse a complete list of discounts for ones you want to add. After that your purchase behavior is exactly the same as usual, with automatic redemptions occurring silently and appearing on your receipt…

I LOVE this! I’ve been waiting for years for someone to pull all of this together. The credit-card linked coupon offerings to-date have been very limited. I can’t wait to use this product.

Coupon photo from freestockphotos.biz.

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Don’t Limit Your Leverage By Negotiating Piecemeal

Posted on April 2, 2012 and filed under Business Development.

Mark Suster has another great post on negotiating tactics. This one dealing with how to handle the laundry list of items that need to be addressed after the first draft of an agreement. The best way to handle these is to take them as a package, rather than negotiating them “piecemeal” (line by line). Here’s the money quote:

The problem with negotiating piecemeal … is that you trade on every item. You don’t prioritize the issues which you really care about. If you don’t want to give a millimeter on one item you have a hard time doing that point-by-point. Done as a “package deal” you can say, “I gave in on these 5 issues that you asked for. On this issue I can’t give.” That’s much harder to pull off piecemeal.

This is the reason attorneys trade redlines of entire documents rather than e-mails back and forth about each separate item. It’s faster and it gets each party closer to where they want to be on the items they care most about. Win-Win!

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Don’t Suck At Meetings

Posted on March 31, 2012 and filed under Communications,Leadership,Productivity.

I’m usually not a fan of infographics. They’re overused and typically not that good. But this one from Sales Crunch regarding meetings was an unexpected find on Pinterest. I recommend checking it out for Business Development and Product Management professionals.

The take-aways for me were:

Respect the value of attendees’ time – a single meeting can literally eat up thousands of dollars
Stick to 30 minutes or less – anything more and people rapidly lose attention
Don’t do all the talking, engage your attendees – the more people participate, the more attention they’ll pay
Limit your presentation to 20 slides or less – anything more takes too much time to produce and reduces the likelihood of people reading it during the follow-up process