SHY Entrepreneur.com

Tag: Become an Entrepreneur

  • Entrepreneur Types

    Entrepreneur Types

    As the years roll by I have been challenged by the seemingly unending spectrum of entrepreneur types. There are big ones, small ones, one-shot ones, bad ones, good ones, and sad ones. Some are exuberant sales man while others are unassuming, quiet, and reserved. This shouldn’t be surprising as no two people are alike so why would two entrepreneurs be alike. Seems silly now that I think about it. In any case this should be a word of encouragement for anyone wondering where they sit and if they have what it takes to be an entrepreneur.

    The short answer is you do. What type of entrepreneur you will be I can’t answer but I do know if you have a desire for business and enterprise you will in some way manifest entrepreneurship in your life. What exactly is an entrepreneur you ask? Well according to my 1939 Webster’s Collegiate Dictionary an entrepreneur is: An employer as the person who assumes the risk and management of business. For reference it points us to “Enterprise”.

    Enterprise is defines as: 1. An undertaking especially one which involves activity, courage, energy, or the like; an important or daring project. 2. The character or disposition that leads one to attempt the difficult, the untried, etc.

    So, from this it reasons that an entrepreneurial effort could be considered any project conducted for the sake of business. Is that an over simplification? I don’t know. This does open the door to allowing any employee to define themselves as an entrepreneur. An employee exchanges their time for money after all. Can you have entrepreneurial employees within an organization? I believe you can and should. I would love to have an employee that assumes the management of running business through courageous activities which attempt difficult, important, and daring projects. To me that sounds like a key figure for any organization.

    Entrepreneurial Mindset.

    Does this mean entrepreneurship is not what you do but rather how you do it? Yes. It is the mindset, drive, and bravado that is in the heart of change makers. Ok ok ok. So does this also mean there are prominent business men and women that would not be entrepreneurs? Exactly. Unfortunately there are “business people” that hide behind their titles, their employees, or previous success and do not have the heart of an entrepreneur. This of course won’t allow them to swim long in a free market environment but they are out there.
    When most people think of entrepreneurs they think of big name tech startup founders. This is an image of an entrepreneur but not the only image. Take the single mom working on a side business at night. Or, the college student who flips product on EBay. Both are entrepreneurs in their own right and will likely find themselves someday managing over their contemporaries that sat on the sidelines while they put in the extra effort to generate business.
    Allow me to segregate the entrepreneur types that you might find. You will see this in your own journey as well as with your business associates. If you think of this as a normal distribution broken into 3 parts you would have roughly the first 16% of entrepreneurs are babies (getting started), 70% are adolescent (regularly practicing), and 16% seasoned. (This highly scientific conclusion is based on nothing more than my need for a frame work so please poke holes.)

    Baby Entrepreneur (getting started)

    The baby entrepreneur is the individual that is cutting their teeth in the business world. This brings to mind the lemonade stands, paper routes, and candy brokers commonly heard about in the early stages of countless biographies. It also brings to mind the working professional that has decided they want to subsidize their income with a side job or buys their first rental property. Baby entrepreneurs won’t necessarily self-identify as an entrepreneur but are in fact on the spectrum.
    I would also put those of us that have sporadic sperts of ingenuity or creative problem solving. Evidence of this could be a project, an idea, an effort, or a tool. Any solution you have ever come up with that solved a problem is the seed of enterprise. They may not always be something that can be commercialized but is enterprising nonetheless. This spring of inspiration flows into the river of execution.

    Adolescent Entrepreneur (regularly practicing)

    I believe most entrepreneurs will find themselves under this classification. The adolescent entrepreneur is full of piss and vinegar. Ready to take on the world and all of its problem. Not yet emboldened by years of experience but also not at the starting gate. These would be the deal maker, opportunist, or small business owner that habitually makes money through their projects. This could be the firefighter that has a business that seals asphalt when he isn’t on duty or the teacher who paints houses every summer. They know the ins and outs of running a business but perhaps only in a single field. May have few or no employees and are regularly competing in the free market. They may not live solely on their entrepreneurial income but they see more cash flow from their efforts than the baby entrepreneurs.

    Seasoned Entrepreneur (never stops)

    The seasoned entrepreneur would be living solely on their entrepreneurial efforts. They may not be super wealthy but they do rely 100% on their own efforts to make ends meet. They would rather rely on themselves than anyone else. This means they have the most failures under their belt. Startups that flopped, deals that went south, and maybe even a bankruptcy or two. In short they have lived it. They are the ones who also have a track record of profitable ventures, habitually solve problems, and see the world through lenses of possibility. Likely have/had many employees and possibly active in many businesses. If they are aren’t still “in the game” they are probably on the board of directors for any number of organizations.

    Are you an entrepreneur?

    So, are you an entrepreneur? I bet you are, otherwise why would you be reading this? If you are a working professional that feels stuck or a full-time mom struggling to pay the bills you can be a SHY Entrepreneur on your own journey to build enterprise. Our desire is to bring you hope and confidence to take your next steps and add value to others in this world. Your unique perspective and approach to the problems you face is needed and I am excited to hear about the solutions you will bring.

  • Business Model Generation Template

    The formula for success is a question that has long plagued entrepreneurs, but a helpful tool now exists that will assist in identifying the primary metrics of any business. The business model generation template comes from the minds of 470 contributors and was compiled in the book Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers, authored by Alexander Osterwalder.

    The approach that Mr. Osterwalder and his team established exists to identify the fundamental elements required for a viable business venture. The method has gained so much attention that it is being used in Stanford Universities’ ENGR 245 course. Professor Steve Blank teaches his students to set a baseline model for a venture and rapidly change the design as their intuition about the customer grows.

    I strongly encourage you to get the book and familiarize yourself with business model generation. Once you have, you can define your own ventures according to it. In turn, this will allow you to identify potential strategies as well as shortcomings your organization may have. A preview of the book is available here. Take half an hour and study the approach. It is fairly straightforward, so you may not even need that long.

    Entrepreneurs are often their own biggest enemy because they don’t fully understand their business. A contributor to this reality is the inability to standardize business dynamics. Business model generation, however, provides a framework by which entrepreneurs can iron out all of the major elements of their venture and visually communicate them to others. The generation model consists of the following 9 elements.

    The Customer

    It begins with the customer and the market your product or service will serve. Will you be targeting a specific demographic or geographic region, or is your focus a bit broader? What is the need you will be fulfilling, and why does it exist? These questions and more are answered through the model, and it provides an intimate understanding of your target market.

    The Value Proposition

    A value proposition is effectively your solution to the customer’s problem. How is your company providing value to your market? As you will see in the book, there are many ways to bring about value.

    Channels

    Channels are the means by which value is delivered to the customer. For physical products this could be distributors and warehouses. Digital products may include such channels as Amazon or Clickbank.

    Customer Relationships

    This probably goes without saying, but identifying how customer relationships are facilitated through your company is an important element to nail down.

    Revenue Streams

    How is the money coming in? Are their multiple streams? What are they? How do they work? What is the pricing structure? If a market is mature it will define much of this inherently. If you are competing in an emerging market, there will be more freedom to explore other possibilities.

    Key Resource

    What are the primary resources that allow you to fulfill your value proposition? This would relate to physical assets, people, and finances. This may also include proprietary methodologies that are not readily available.

    Key Activities

    What are the primary actions that allow you to deliver the value proposition? This will also be driven in large part by the nature of the market. Mass market products that focus on the general populace will require a great deal of marketing, whereas specialty manufacturing products will require specialized processes.

    Key Partnerships

    These are all of the relationships that aid in providing your value proposition to the customer. Suppliers, contributors, and joint venture partners would all fall under this category. Partnerships often play integral roles in small business because of the limited funding. A landscaper, for example, may team up with a home builder to perpetuate business. In all instances these will be win-win scenarios.

    Cost Structure

    All businesses require money to be spent in order to operate. What will it cost to provide your value proposition? There will always be more ways to spend money than you need. Identifying the primary elements that allow you to provide your solution and accounting for them appropriately is vital for success.

    Using the Tool

    The canvas template tool will allow you to outline a complete organization. Mr. Osterwalder suggests exploring multiple models when addressing your start-up. Much like prototyping a product, he mentions “prototyping” your business model. You may have originally set out to supply the end user with a single product, but perhaps it would be possible to create a subscription-style compensation in which your product is only available as long as the customer subscribes. If you don’t plan on pursuing alternative “prototypes” it is wise to explore the potential alternatives.

    I have taken the liberty to create a form-based Business Model Generation Template PDF.

    Using this visual allows you to convey to potential investors and people within your organization how your company operates. It will also help you to see the big picture. No single part is more important than the next; they all play a role in moving the business along. Once you establish your model, it would be wise to revisit it from time to time to update it and make any changes that may be required. Small business is very dynamic and in some cases changing your model entirely may be the most appropriate move.
    I have provided the canvas for SHYEntrepreneur.com to give an insider’s view of our organization.

  • Why is Time Management Important?

    Time is the only one true fixed resource. Having a finite amount of time to complete any task makes time management an integral part of an organization.  Entrepreneurs often have difficulty balancing their planning and organizing while simultaneously entertaining potential customers. What most don’t realize is that the time they have is very limited, and not all responsibilities carry the same weight. The good news is that time management skills can be acquired and sharpened.

    What is Your Goal?

    The reason your business exists is probably the same reason most for-profit businesses exist, to make money. As strange as it may sound, people often lose sight of this simple truth and exhaust themselves on matters that don’t bring in the profits they need.  Small businesses and entrepreneurs cannot afford to not make money, so be sure you spend your time on items that are closely tied to your bottom line. As your business grows, you will be afforded the ability to invest into matters that are indirectly tied to your success, such as community events and fundraisers, but initially non-money-making events can push you closer to closing your doors.

    Invest Into Your Competitive Advantage

    As a small business and entrepreneur you have a clearly defined competitive advantage, right? I have discussed previously the factors of competitive advantage, but it is worth addressing again. The value you bring to your customers is directly tied to the money you will make. As you conduct business, it is wise to spend time identifying your customer’s needs. Continually refining and building your competitive advantage is time well-spent. Markets change, which causes the needs of your customers to fluctuate, and a wise business owner will know where the trends are headed and position themselves to take full advantage of future developments.

    Small business is often in the business of quick turnarounds, which may even be the bulk of your competitive advantage. If this is the case, I don’t need to tell you why time management will help your company succeed.

    Have You Exceeded Your Capacity?

    Sole proprietors can often find themselves at the end of their rope because they are the entirety of their business and they can’t justify bringing in some help. The truth is that growth will be much faster when capacity is not maxed out.  Having a growth strategy and increasing your capacity can be the first step towards a well-managed organization and additional time to do what you want. In project management, buffers are introduced to account for variability, and the same principle applies to individuals. If you don’t have a buffer of down time in your schedule, your overall productivity will decline. As a resource reaches 70% of its capacity, its throughput begins to decline. Use this metric to determine if you need help, and increase the capacity of your organization each time it reaches the 70% mark.

    Are You Multitasking? STOP IT!!!

    Few things are as detrimental to completing a project as multitasking. We have been conditioned to believe that multitasking is a good skill that should be practiced and admired.  The truth is that multitasking is the culprit behind more unfinished projects than anything else. The specifics of this can be explored in the article “Successful Habits.” The short of it is that multitasking pushes every task out to be completed at the end of your allotted schedule as opposed to finishing single tasks early.

    There is a cognitive lag that occurs when you switch your thinking from one focus to another. This means that time is lost as you stop thinking about one issue and begin thinking about the next. Your brain operates much like a fly wheel that starts off slow, picks up speed, and then requires time to slow down. Jumping from task to task requires you to get up to speed, complete the task, and then slam on the brakes for the next transition. You can see how this can become exhausting as well as time consuming. If you stick to one task until it is complete you will finish faster and probably do a better job.

    Follow the Pareto Principle

    The Pareto Principle is most commonly referred to as the 80/20 rule. 80% of the spoils come from 20% of the effort. By leveraging this principle you can be sure that your time is spent working towards your goal of making money and not spent treading water. Prioritizing according to Pareto can be tricky because 80% of the things that you could spend your time on won’t help your bottom line. Learning how to sift through the noise to get to what really matters is a skill that must be actively practiced.

    A tool that can help you with applying the Pareto principle is Stephen Covey’s time-management matrix, explored in the article “Small Business Resource Management.” The matrix identifies the relation of urgency to importance and establishes four quadrants of time consumption. This offers a great starting point for identifying which tasks you may want to off-load to an employee and which ones you should invest in a little more.

    Conclusion

    There is no wrong way to approach how you manage your time, but there are most certainly better ways to go about your business. It should be noted that individual work habits and personalities will respond differently to the techniques shared above. Keep your mind open to new approaches, adopt what works, and ignore what doesn’t.
    Personally, I have found that I am my biggest roadblock, and breaking through my own predispositions had afforded me more time than anything else. This is especially true for you perfectionists out there. Perfection is the enemy of completion. A good job done on time is better than a perfect job completed late.

  • How to Become an Entrepreneur

    Becoming an entrepreneur is nothing more than changing the way you see the world. As an entrepreneur you are always looking for and taking advantage of new angles and opportunities.

    Knowing the true definition of entrepreneur provides a start to becoming the entrepreneur inside. The single biggest thing you can do to become an entrepreneur is to act. One of the biggest hurdles on the road to being an entrepreneur is not taking action.

    Not taking action
    As an example, I was visiting Nashville, TN, and while I was there I decided to shop for some shorts. I came to a discount store that carried boxes upon boxes of name-brand shorts, which I knew to be valued between $50 and $60 a pair. Their price…$4 to $7 each. Wow, what a deal!

    It was winter, so I could see how the discount store justified selling the shorts at such a price to keep the inventory moving. I snagged six pairs for less than the price I was ready to pay for one. This was a great deal, but I did not exercise the entrepreneurial muscle that I know now I should have.

    As I was walking out of the store I thought to myself, “If I buy $400 worth of these shorts and hold onto them until summer, I bet I could easily double or triple my money.” I chewed on it for a second then left. I didn’t take action.

    Well, summer came and I enjoyed my shorts, but I didn’t enjoy the fact that I left hundreds of dollars on the table. Had I taken the time and put in the little bit of effort required to buy the shorts and ship them home, I would have been able to cover the cost of my entire trip down there.

    Taking action
    I can’t share the bad without discussing the good, so here is an example of what can happen when you do take action.

    I was solicited by my sister to help clean out an office building that was left vacant by a high-tech company that left town. It was a professional environment, and apparently they didn’t care about leaving a few items behind.

    I began gathering everything together and running it down to the dumpster. When I got my first load to the parking lot, it occurred to me that these toner cartridges and office supplies must have some value. With this thought I picked through my load and put the items I thought may be worth something into the back of my truck.

    I finished cleaning out office space and went home to list my finds on eBay.  Over the course of the next few weeks, I sold all sorts of clerical and office supplies that were once destined for the garbage. When everything was said and done my total earnings on the “garbage” was $1600.

    Can you see the difference between these two examples? When I took the time to execute my idea, I was able to bring home a good deal of change. When I failed to execute I was left wondering what if.

    Chance are those great ideas you have bouncing around your head have been thought of before, but the question is, are you willing to take the chance and make something happen?