I’ve been working on a couple of child obesity projects (early last month I launched a new company one called MyPed - developing technology to motivate kids to increase their physical activity).
I’ve developed a survey aimed at parents - if you are a parent and want to say something about the childhood obesity issue please visit fill-in and submit our survey.
One of my clients, jdrlegal, have teamed up with iconnect2u to create s.h.a.r.c. - “stuff that’s helpful and really cool.” It features technology reviews, business and intellectual property issues and strategies for exporting to the US.
Bill Reichert, from Garage Technology Ventures, says that telling a good story is vital when making pitches. Read his article here.
I have created a Powerpoint template based on this guide. You can download it here.
Great article from Allister Heath (via The Australian). He discusses the positive role foreign companies play in thrid-world countries:
In a paper debunking the sweatshop myth, Paul Glewwe, a leading development economist, revealed that the average wage-earner in Vietnam earned US23c an hour, but workers in foreign-owned businesses fared far better, making an average of US42c an hour. When Glewwe conducted his work, 15 per cent of Vietnamese were classified as very poor and 37 per cent as poor. But nobody working for multinationals was classified as very poor and only about 8 per cent were poor, proving that working for a foreign company is the best way to escape poverty and deprivation. Foreign employers drive wealth creation, pushing up everybody’s wages.
Earlier this year, I came across the concept of microcredit – low (or no) interest loans given to third world entrepreneurs to invest in new machinery, tools for their business. Loan sizes vary from $20 to $2000 – hence the “micro” bit of microcredit.
I think this is a great concept - empowering local entrepreneurs to improve their productivity, their incomes and creating a multiplier effect in the local economy.
I then found a Podcast from VentureVoice interviewing Premal Shah, founder of Kiva.org:
Kiva lets you connect with and loan money to unique small businesses in the developing world. By choosing a business on Kiva.org, you can “sponsor a business” and help the world’s working poor make great strides towards economic independence. Throughout the course of the loan (usually 6-12 months), you can receive email journal updates from the business you’ve sponsored. As loans are repaid, you get your loan money back.
Inspired, I browsed the many projects on offer and decided to lend to Kennedy Nkansah, a local carpenter looking to purchase a wood planer and bench saw.
I encourage all to visit Kiva and browse the projects on offer.
The Art of the Pitch: Explain Yourself in Language Investors Understand
Entrepreneurs can find endless advice on this subject, but Susan Wu, a venture capitalist at Charles River Ventures, has an unusual approach: She explores it from the perspective of fundamental communication. Here are two of her suggestions for improving clarity:
1. Use descriptive language and analogies. “What constitutes ‘community-centric collaboration tools’ may mean blogs to you, wikis to me, and e-mail to someone else,” she says. “Reduce the probability of misinterpretation by using visuals, showing demos, and telling stories about customer-use cases.”
2. Clearly explain the customer problem you will solve. “Tell a story about how you make [customers’] lives easier, more efficient, more enjoyable, more fulfilling. In order to do this, you need to understand what your business is really about. Understanding how customers relate to your product or service emotionally also helps illuminate how they might value it economically.”
One story Wu likes to hear during the pitch: how entrepreneurs came up with their business ideas. “This is your chance to transport me into your world and to help me feel the pain of the problem you’re solving.”
I often gloss over the problem my idea will solve and get stuck into the solution (ie. the technology). A technique that helps me is to talk to my partner about my business ventures - she lets me know which part of my “elevator pitch” I need to work on.
1. Single Founder
2. Bad Location
3. Marginal Niche
4. Derivative Idea
5. Obstinacy
6. Hiring Bad Programmers
7. Choosing the Wrong Platform
8. Slowness in Launching
9. Launching Too Early
10. Having No Specific User in Mind
11. Raising Too Little Money
12. Spending Too Much
13. Raising Too Much Money
14. Poor Investor Management
15. Sacrificing Users to (Supposed) Profit
16. Not Wanting to Get Your Hands Dirty
17. Fights Between Founders
18. A Half-Hearted Effort
Some of these mistakes are diametrically oppsosed eg. Raising Too Much Money vs Raising Too Little Money and Slowness in Launching vs Launching Too Early. But Paul does clarify and it does make sense.
One mistake that I would add (which is somewhat related to Mistake #18) is the lack of passion. I believe that launching a venture purely to make money will ultimately fail. The reason is that your employees, suppliers, friends and family (which are important) will see through you. Erick Mueller, whom I met at an entrepreneurship workshop, failed in a jewelry venture. “I don’t know why did it, I hate jewelry, but I thought I could make some money.”
You need to have passion in the technology, the products, the service your business provides and/or the market.
Heard a great radio interview last week on ABC Radio National on “Dynamic Capitalism.” Edmund Phelps, a professor of political economy at Columbia University, talked about the way capitalism works in Anlgosphere (eg. US, UK, Canada and Australia) versus continental Western Europe (eg. France, Germany, Italy).
His basic premise was that the Anglosphere had a dynamic capatilsm system characterised by:
it’s all about new ideas and entrepreneurs who are prepared to develop them and financiers who are prepared to back those ideas, and there is relatively little pressure on financiers to back this kind of thing or back that entrepreneur rather than some other one. So we have a shot at getting a good selection of ideas and having, as a result, an economy that is not only innovative but also innovative in commercially promising directions.
As opposed to continental Western Europe:
the problem is that there is an extensive involvement of the government in the economy and there is so much emphasis upon the rights of the social partners, labour, communities and so forth and so much emphasis on stake holders, the employees, that as a result it’s almost as if there had to be unanimity before a new investment project could be approved or an innovation could be developed.
One of Edmund Phelps most interesting conclusions is that capitalism can allow ordinary people to creatively express themselves, solve problems and work on interesting projects, thus improving their mental stimulation and personal development:
but it’s also true that they [Western Europe] deprived themselves of the fun of innovating and the job satisfaction that employees derive from having problems to solve and developing their talents as a result, so expanding their capabilities. So yes, they’re avoiding the risks but they’re also missing out on the stimulation and the personal development.
This fits in well with the way I think about entrepreneurship. It’s not about the money. That’s a by-product. I do it becasue it it’s challenging. I think of wonderful ways to solve problems. I help and mentor others starting up new businesses. I don’t think I could ever get that experience and personal development anywhere else.
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