Business On The Move -- To Home Base

It is difficult to over estimate the impact of hundreds of thousands of small businesses moving. They are not moving to larger buildings. No, they are moving home. To their own houses and garages. They are down sizing and down expensing their businesses back to Square One.

Local and state governments consider these home businesses a menace because they simply fly under the taxing radar screens. A tailor shop in the back bedroom can go unnoticed for decades. A bicycle repair business in the garage may be a bit more noticeable, but not much. A consulting businesses, even one that earns hundreds of thousands of dollars, can go years and years before any agency knows it is there.

I certainly don't mean to infer that these home businesses are dead beat businesses. On the contrary, I back them 1,000%. These home businesses are what will get the economy moving again, faster than anything else I can think of. They are nimble, they generate income quickly, they put that money back into the finance markets, they buy groceries, they deposit savings, they are active. There isn't another business I can think of that so positively affects the economy as rapidly as these home businesses do.

And these businesses are the ones that will literally save families. Without these businesses, there are a lot of families that would find it very hard to eat. The Wall Street Journal talked about one small business, a fish market, that shifted back to working out of a home garage. The local pols didn't like it, but his neighbors backed him 10 to 1. As one neighbor put it, "It is the only thing that has kept them alive."

As we fight to get business loans back on track, I applaud the ingenuity and hard work of these entrepreneurs. And I thank them for helping us all rebuild the country.

Great Marketing Plan Research Tool

While business loans are getting harder to come by, the one thing that really makes a difference is the marketing research that you do. We are always pleased to let you know about great research oriented websites that we learn of, and this industry directory from Penn State is certainly one of them.

There is no new information on this site. Rather, what it does is pull together links for researching hundreds of different industries: blogs, websites, industry information, company information, news, stats, etc. -- in short, just about every type of information a savvy entrepreneur would need for the Industry Analysis for his/her business plan. Everything from art glass to casinos to insurance companies is included.

The one void we saw was information on internet businesses. Since internet business is the explosive area of business, this is a major omission. Also, some of the links aren't working right yet. I assume the directory is in its infancy yet, and these problems will be fixed.

While you are on the site, take a look at the Nav Bar for "Business Databases". A whole slew of databases pop up. Some of them are for Penn State students only, but many are accessible by anyone.

All in all, a good addition to your research tool box.

The Grant of Grants -- From Pepsi

We're looking for people, businesses, and non-profits with ideas that will have a positive impact. Look around your community and think about how you want to change it.

That is exactly what the headline says on RefreshEverything , the great giveaway from Pepsi.

What an incredible idea!! If I didn't drink Pepsi before (and I did), I would certainly drink it now.

The ideas presented are absolutely outstanding. There are projects for children, for seniors, for bike riders, for health. Every month people (i.e., you and me) are asked to vote for our favorite projects. Pepsi will fund the winners.

This is probably not a way to fund a business all by itself, BUT (and that is a big "but") your company can certainly sponsor an idea and see it to fruition. Wow, the PR in such a project has got to be phenomenal. Not only are you featured on the Pepsi website, but your local paper will run the article, as will your industry newsletter, and your clients will know all about it too. And so will your banker.

It is, in short, a way to focus the spotlight on your business like no other way I can imagine.

Only 1,000 ideas a month are accepted into the contest, so hurry up and get your idea together. Don't worry if you miss the deadline this time. The contest will run again in March. And April.

Look Abroad, Young Entrepreneur. Exports And Small Business

It is a new era in small business finance.

Since President Obama announced his plans to doubling exports over the next five years, organizations are now stepping up efforts to contribute to the solutions. For example, members of the Association for Equipment Manufacturers are putting together a program to assist with financing of products for overseas sales.

The AEM program won't be the last, not by a long shot. A big slice of our small business future lies in our ability to export our goods. Look for other industries to put together similar programs that will provide financing for exporting.

Take another look at your own products as well. Are any of them potential export items? If not, why not? Can you make adjustments that WILL make them exportable? Any company that can focus more on exports is going to find it easier to raise financing than those that can't. So it is very worthwhile to take the time to inventory your products, your adaptability, and your export knowledge. Also contact your own industry association and see what is being done to help with export financing.

And if you are already exporting, is there a potential for increasing your exports? If all you need is financing to create more product, odds are pretty good that the financing will be there.

This is the time to take a really hard, creative look at the potential of your business.

Got An Idea With Nowhere To Go?

Do you have a great business idea, all dressed up, with nowhere to go? Well, there just might be a place for you with the yuppies of Silicon Valley.

If they weren't already so blasted successful, it would be tempting to call them airheads. You have got to take a look at The Start Project . Be sure to click the tiny "info" button up in the corner.

Which one do you think is a co-founder of WordPress? or the former Google VIP? or the angel investor? They are all there -- honest.

This has got to be one of the heaviest "success groups" to ever form. Ever. So what do they do? Their website says:

“The start project is a collaborative effort to bring great ideas to market. While the founders have a history of successful exits (over half a billion dollars), they are now focused on the initial stages of business creation including: idea generation, software development, product vision, team building, and investment.”

So why do I tell you this? Well, it seems they welcome "brief, coherent inquiries" from us mortals. Email info@thestartproject.com . Keep it brief. And coherent. And only if your idea is really, really great.

How Does $30 BILLION Sound?

If ever there was a time to get your business plan in order, THIS IS IT!!!

$30 BILLION is coming straight at you. Duck and you will miss it. Catch it with your spiffy business plan and part of it is yours.

It is no giveaway. It will be a loan. But it will be funneled through smaller community banks and headed straight for small businesses, NOT the big guys.

Small business hasn't had news this good in decades. We yelled and screamed that money wasn't reaching us, and finally Washington heard us. In his State of the Union address on Wednesday, President Obama said he is taking $30 billion out of the bank rescue fund and creating a program that will help small business.

What will it take to get a slice of that money? Several things:

1. A sharp business plan. Your loan request must be "sold". There are no "gimmes". It must be well written and documented, just like a regular business plan.

2. A business that will help create jobs is a step ahead. The whole reason for doing this project was to create jobs. So point out in your business plan just how your business will create more jobs, even if those jobs are part time, or work you hire from a consultant. If you really expect to give yourself a 500% raise this year, it probably won't fly. Benefit as many people as you can.

3. A business that helps its community is a step ahead. These loans are coming from community banks. Community banks are, by definition, concerned about their communities. The more you can help your community, the better. The more the bank can brag about your business, the better.

Devour this website if you have not already done so. Decide NOW what exactly you need, and how you are going to get it. Then go for it. Your chances have never been better.

Ohio Tackles Small Business Head On

Ohio isn't waiting around for big government projects or programs. It is creating its own support system for its small businesses.

In his State of the State address today, Ohio Gov. Ted Strickland focused on how Ohio has emerged as a leader in advanced energy. Ohio ranked No. 1 in green jobs created last year and held the same status when it comes down to renewable and advanced energy manufacturing jobs.

The governor announced an agenda which calls for establishing the “Energy Gateway Fund”. This is a $40-million commitment of state and federal stimulus funds to grow and sustain fuel cell, solar, wind and energy storage industries.

In his address, the governor addressed the credit crunch by creating “The Small Business Growth Partnership”. This is a business lending clearinghouse to help small businesses find the working capital they need to grow their businesses.

A groundbreaking agreement between Cincinnati-based P&G and the University System of Ohio was also announced. Through this, there’s an aim at strengthening research collaborations between university faculty and students and P&G. The initiative will turn innovative ideas into economic development and new jobs in Ohio.

“Build Your Own Business” is a statewide expansion of the highly successful program at Lorain County Community College. Business training and support to budding small business people will take place. Through a partnership with Ohio’s Small Business Development Centers, state community colleges and adult career centers, the state will offer unemployed Ohioans courses and training on starting a business, and the opportunity to work with business mentors and access small start-up loans of $5,000. $5,000 doesn't sound like much, but it may well be enough to get an internet business off the ground, as well as many more home based businesses. It can bring a whole new generation of entrepreneurs to Ohio.

These are exactly the kinds of programs that need to be developed in every state in the union, programs that reach emerging businesses and small businesses too. We applaud Ohio for working with its entrepreneurial community.

Which state will step up to the plate next?

How Many Business Plan Competitions Are You Ready For?

This announcement appeared recently about a business plan competition in New York:

Growth-oriented businesses in Oneida and Herkimer Counties in New York with an innovative business plan are being sought to enter the Mohawk Valley Emerging Business Competition.

The winner of the contest will receive a cash award of $15,000 and an additional $15,000 in professional services including a marketing plan developed by SUNYIT’s Business School.

"This competition gives small, local manufacturers an opportunity to accelerate their business," said Steven J. DiMeo, President of Mohawk Valley EDGE. "A business plan is a critical step in any business venture, and we hope this contest encourages companies to organize and execute their plan," he added.

The emerging business competition is open to companies in Oneida or Herkimer County with less than $5 million in annual revenue and a strong business plan.

I don't mention this because it affects so many of us. Obviously, very few of us live or work in Oneida or Herkimer County.

I don't mention this because the award is so great. It is not. $15,000 just does not go very far these days.

I mention it because "we hope this contest encourages companies to organize and execute their plan". That is the important part.

Honestly, how many of us have a business plan of any kind right now, and how many of us are sitting on the fence, waiting for something to happen? Sitting on the fence doesn't work. Yes, everything comes to he who waits ... even failure. But we are far more likely to get what we want if we actively plan for it and go after it.

So what is your plan for success this year? Haven't got one? Maybe it is time to get it.

Read An Angel Investor's Mind

Would you like a peek into an angel investor's mind? Fortunately, there are a number of angel investors who enjoy sharing their insights with the common folk. Here are the most popular blogs from angel investors, based on the number of unique visitors per month that each receives. (Note: This does NOT include RSS feed subscriptions, which could change the list the dramatically.)

1. Fred Wilson, Union Square Ventures, A VC
2. Guy Kawasaki, Garage Technology Ventures, How To Change The World
3. Paul Graham, YCombinator, Essays
4. Brad Feld, Foundry Group, Feld Thoughts
5. Mark Suster, GRP Partners, Both Sides of the Table

For my money, I have always enjoyed Guy Kawasaki. He is irreverent, inspiring and just plain entertaining.

In these blogs you will discussion on business plans and presentations to venture capitalists, as well as comments on the industry as a whole. Should you be planning to present to venture capitalists or angel investors, do some real homework and track down any blogs that they might have. If they are there, study them from cover to cover. There is hardly a better way in the world of really getting to know the guy across the table.

Minority Business Owners -- Fly Delta!!

Delta Air Lines (NYSE: DAL) is expanding its outreach to small, minority- and women-owned businesses as part of an increased commitment to enhancing the diversity of its business partners. The airline is using new web-based technology developed by CVM Solutions, LLC to broaden its search for diverse suppliers and to increase purchasing from certified business enterprises owned by minorities, women, veterans and disabled persons.

Diverse businesses of all types can register online in the CVM supplier registration system at http://www.deltasupplierdiversity.cvmsolutions.com to make their businesses more readily available to Delta purchasing managers worldwide.

"This initiative is simply good for business," said Steve Gorman, Delta's executive vice president and chief operating officer. "It strengthens Delta's focus on the diversity of our suppliers to ensure that we are partnering with companies that reflect the global nature of our business. It also underscores our commitment to the diversity of communities we serve."

Over the next few years, Delta plans to increase development and mentoring of current diverse suppliers in an effort to help them gain more business in the future. The airline also is implementing a program to encourage its suppliers to broaden the diversity of their own business partners.

Tea and Crumpets and Small Business Plans

I am so delighted I feel like skipping. I know this is a corny reaction, but it is a very honest one, especially for small business finance and business plans and tea and crumpets. To begin at the beginning ...

About two years ago, as this financial muddle was just beginning to mess up our businesses and our lives, my favorite teas disappeared from store shelves. Now I am particularly fond of Lady Gray tea and Darjeeling tea. But I couldn't find either one for over two years. It was like every store in creation decided to carry all the same "basic" stuff, and nobody had any fun stuff anymore.

It was, of course, pure economics. People were cutting back on buying anything frivolous. And Lady Grey and Darjeeling teas were frivolous. Stores didn't want any excess inventory on hand. None. Zip. Zilch.

Then this morning, out of clear blue with no warning at all, there was Lady Gray back on the shelf at my local Pavillions. I was so thrilled I was beside myself.

Yes, now I can have my favorite frivolous tea with crumpets. But it is much more than that. The fact that stores are beginning to carry frivolous products again is such a MAJOR harbinger of great things to come. I know one box of tea doesn't make a stable economy, but it goes a long way to boosting my spirits. And because of that, I may even buy fancier crumpets to go with it.

There are wider implications, too. It means that like the tiny grasses of springtime, there may be faint signs of an economic recovery. We got the news today too that Christmas sales weren't great, but they were OK. "OK" is a whole lot better than "yucky". We've had "yucky" long enough.

Yes, this is the time to plan your new business, or to regroup your old one. Get your business plan in order. With a bit of a push in the right direction, we can all be enjoying a fine glass of wine now and then.

Troops To The Rescue in Small Business Financing

President Obama is arm wrestling banks into lending more to small and mid size businesses. He told them bluntly today that the American people gave banks extraordinary help to rescue their industry, and now he expects banks to do the same for American small business.

Banks were quick to respond. Bank of America CEO Kenneth Lewis pledged that his bank would lend $5 billion more to small- and mid-sized businesses in 2010 than it did in 2009. and JPMorgan Chase Co., said last month that it would boost such lending by $4 billion.

This isn't the end to the problem by any means. But it is a step in the right direction.

Banks complain that federal regulators are keeping a tight rein on their cash, and they aren't as able to lend as they would like to be.

Did you notice the full page ad in the Wall Street Journal placed by one bank that is openly wooing those "with less than stellar credit"? I am astounded. Thrilled, but astounded. That certainly doesn't open the door for businesses with bad credit, but it does nudge the door open for those with a bit of iffy credit.

It has been said many times before, and will be said many times again: It took us a long time to get into this mess, and it is going to take a long time to get out. Those businesses that can manage their cash reserves effectively are the ones that will survive.

Never before has it been so important to approach lenders with strong written documentation. Yes, a strong business plan. There is simply no way of getting funding without it. Never, never assume that any banker "knows" your company is improving. They don't. You need to set out everything literally in black and white.

Here's hoping that other banks follow suit soon, and that more money will be available real, real soon.

Top Marketing Info

New Zealand continually amazes me. I am not surprised when the US or Canada or the UK comes out with a great series on industry marketing analysis, so I guess I shouldn't be surprised when New Zealand does.

The New Zealand series has a number of great features:
The reports are dated, so you know instantly how current the information is;
There are brief descriptions and expanded pdfs for all topics;
The depth of information is truly commendable;
All information is free. Every single word.

With the world shrinking as it through online sales and marketing, the more important it becomes for us to reach out for broader industry studies. These marketing studies typically cost many thousands of dollars. For most small businesses, that is prohibitive. So we look to government sources for our marketing studies.

And this is a really great source for that industry marketing information.

The 5 Steps To Business Grants

We are often asked about business grants. There are two very common misperceptions:
1. There are slews of them (there are not), and
2. There are no business grants (well, yes there are some).

The truth of the matter is that there are thousands of business grants available. Many are small. And virtually all of them are hard to get.

Here's what it takes to latch onto a business grant:

1. Make Sure You Can Meet the Requirements of The Grant
Once you determine grants that you want to target, you and your management team need to do the necessary research to determine how closely you will be able to match the requirements of the grant. Tasks include interviewing people within the company, talking with investors and partners, and doing research on the competition in your market, Farnsworth advises. If you've never applied for a grant before, this process could take up to a month.

It's also a good idea to make friends with the grant administrators, who will be happy to give you some feedback on your viability for their particular award.

2. Create A Business Plan To Knock Their Socks Off
While that may seem obvious, companies don't often update these documents and sometimes never have a good one from the beginning. Few things will demonstrate your financial capability and expertise as quickly as a well-constructed business plan. You can bet your booties that you won't get a business grant unless you have an exceptional business plan.

3. Give yourself time to be successful.
Business grants take time. Sometimes weeks. Sometimes months. If a grant is especially sought after, with lots of applicants, it can take a very long time. Don't assume you don't have the grant until you actually receive the letter from the granting agency. And, yes, in the meantime continue to submit for other grants as well.

4. Match Your Skills Item By Item
Go through the announcement of the grant very carefully. Make sure you have every skill that is requested, every bit of experience that is requested. And if you don't have it ...

5. Find a partner
Applying for a grant with a partner, such as a nonprofit or university, can increase your chances of not only winning the award but getting more money. Partners can fill in missing gaps in knowledge or background, and give your business plan real strength.

More and more companies are now applying for business grants. Hone your skills at this game, and it can prove to be a valuable source of funding and professional advancement for your firm.

Start Up Financing - Angel With Purse Strings

On the one hand start up financing is the toughest you will ever encounter as an entrepreneur. You've got no track record. Banks won't even talk to you. Angel investors and venture capital firms won't talk to 99% of the startups out there. So it's tough.

But on the other hand it is the easiest financing you will ever go after. First, you know the obstacles and don't expect a whole lot; and second, you're not bringing a lot of garbage to the table.

Existing companies tend to wait too long to look for financing, not realizing that it can take months, or even years, to tie down financing for expansion. In those months and years they have bills to pay, contracts to complete, employees to pay. By the time financing comes around, it is often too late.

Start up financing is a different keg of fish. You know it is going to take a long time. You either hunker down and slog on through, or you make alternate plans for starting smaller. Or starting differently. Or shifting the business to make it more appealing. But during these months and years, you are not logging up millions of dollars of debt like existing companies, which puts you way far ahead in the financing game.

Truth to be told, by the time you are able to latch onto "start up financing", odds are that you are no longer just a start up. You probably have made significant refinements to your business. You may even have a few clients. You've certainly refined your business plan. All of which makes you a much juicier prospect for any type of lender or investor.

It is the entrepreneur who sits on his proverbial duff, doing nothing, who doesn't get funded, can't get started, and rots away moping. You -- you, with the angel in your own purse strings -- you are the one who succeeds.

So take that time to do your homework and get started right. It will pay off handsomely in the long run.

WAHMs - Never Doubt Your Clout!

The National Association of Women Business Owners estimates 10.1 million companies nationwide are owned by women, accounting for $1.9 trillion in sales and employing 13 million people.

Those are not typos. That's 10,100,000 companies; $1,900,000,000 in Sales; with 13,000,000 employees. And that ain't nothing to sneeze at.

And that is truly just the beginning. Then there are all the work at home moms (and dads) who have single person, at home businesses. These smallish businesses get overlooked in surveys because most statisticians consider them inconsequential, or, at best too hard to locate. WAHMs and DAHMs know better. These are not inconsequential businesses. But, ok, they are probably hard to locate. How do you call up every home in the country and ask if anyone has a home based business? It can't be narrowed by any demographic group because these WAHMs are everywhere, rich and poor, big homes and small, young and old. I personally know several hundred of them, and the only thing that seems to be a common denominator is their desire for a business at home.

Many of these WAHMs have internet based businesses. Some sell products. Some sell services. Some are artists. Some are financial wizards; some aren't. Some are website gurus; some don't know what "SEO" means.

But each and every one of them is successful in her own right, whether she is earning $100 a month or $100,000 a month.

WAHM businesses have taken on more significance since the economy became so unstable and women found themselves without reliable income, or any income at all. Their own creativity and ingenuity has become their stock in trade.

The growth has been driven, too, by a deeper desire to be there for our families, to create an atmosphere of warmth at home -- and still make a living. It has been a long time in coming, but women are finally learning how to successfully combine work and home so that both are successful.

And the world is starting to note.

Small Business Is Too Big To Fail! Business Planning For The New Age

Business planning just got easier for many small businesses. In his address Saturday, President Barack Obama said small businesses have created nearly two-thirds of the nation's new jobs over the past decade and a half.

"They must be at the forefront of our recovery," he said.

This year's $787 billion economic stimulus package made $5 billion in tax breaks available to small business and cut the costs of Small Business Administration loans, Obama said. Last week, he asked Congress to increase the size of some SBA loans and announced a plan to provide low interest loans to small banks that agree to lend more money to small businesses.

So many times it feels like government just doesn't "get it". The trickle down economics that has been popular for so long just doesn't trickle down to the businesses can really jump start the economy. It is essential for government to provide assistance directly where it will do the most good: to the small businesses themselves. Small business can -- and will --be the catalyst to ignite our struggling economy if they are given half a chance.

There are a lot of reasons why the government's money should go directly to small business, not the least of which is that small businesses are just more agile, more able to adapt, than big businesses, without the bloated salaries and bonuses. Small business owners are dependent on the success of their companies, unlike their large business counterparts, and are therefore much more inclined to put the money where it will do the most good, and not in their own pockets.

Business planning for small business means having the ability to NOT plan everything, to be open to shifting economies and trends, to see ahead of the curve. And this is where small businesses really do excel.

And did small businesses really provide two-thirds of the new jobs in the past fifteen years? My guess is that we provided much more. I don't think that statistic takes into account the millions of new entrepreneurs on the web, or others that are just so "small" that they fly under the statistical radar. And many of these businesses are hugely successful by any measure.

It is good to see the financing flow to small business. Very good indeed.

Small Business Marketing Research Turned Upside Down

Suppose you had a potential market of over a billion people? Nice, eh?

Well, suppose that potential market didn't have much money. Not so nice, eh?

Wrrrrrrrrrrrrrong.

Indian inventors have taken that basic information and turned small business marketing research on its head. Consider these products:

• A wood burning stove can make more heat at a cost of $23.
• A refrigerator that runs on batteries sells for $70.
• Heart monitors and baby warmers for clinics have been redesigned to be built for about 10% of their western counterparts.
• A new car goes for $2,200.

And there is a potential market of over a billion people for each of these inventions. It is kind of like inventing the paper clip -- I wish I had thought of that one.

If western products are going to prosper over the next decade, this is the type of thinking we need to do in our marketing research. Reduce the number of parts. Cut manufacturing costs. Create products out of cheaper materials. Get creative.

It is nice when you've got the next biofuel formula waiting for a patent. But if I had my 'druthers, I'd take cell phone service for $2 a month.