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July 21, 2010 / companystarter

Tenacity: To Leap A Series of Hurdles

This August we will go into production and create the first set of real life, honest-to-goodness product samples we will use for sales and promotion.  That’s just a few weeks away and I CAN NOT wait to get there.

But it’s mind-numbing to me that we had planned to go into production in April.  Then in June.  Then July.  Now August.  Each time we rewrote the plan, we based our new timeline on the knowledge we had at the time.  And each time a new hurdle arose which not only put off the timeline, but threatened to derail the whole business.  I’m proud to say that we just overcame the last of our known hurdles and can finally head into production.

It’s appropriate that Mark Suster lists tenacity as the first of 12 characteristics in the Entrepreneur’s DNA.  Mark talks about tenacity in the context of not taking no for an answer, not listening to the nay-sayers who will tell you your idea blows, or it’s been done, or no one will buy it.  In the face of immense pressure to fold, entrepreneurs who believe in their product or idea need tenacity to outlive the criticism.

I agree with that, but in my experience it goes much further than that.  Hearing “no” or “bad idea” is just the first of a thousand hurdles an entrepreneur will encounter on the race to launch, and thousands over the course of the life of the business.  Each one has the potential to derail the whole venture, and only the tenacious can get past each of them.

As I have worked with my partners and supporters to launch my company, I’m constantly in awe of how many times we could have folded.  Some setbacks are just frustrating, like work not being completed on time.  Others are downright devastating and required several weeks of research, rethinking, ingenuity, and, of course, tenacity.  How simple would it have been to say, “ugh, it’s not worth it, I can’t do it, it’s too hard”?  Very, very easy.

In each case, after the initial dust settled, our solutions not only solved the problem, but we rose from the ashes with a stronger product, a better idea, and increased confidence.  With the passage of each hurdle, we are closer and closer to launch.

Of course I want this to be easy.  But it’s not.  It’s launching a business with a million parts and dozens of tasks.  They can’t all go well.  But that’s entrepreneurship.  The payoff on the other end is seeing the result, knowing that if not for your hard work, there would be nothing.  And in between, we learn, we grow, we become enriched, and we prosper.

So Mark is right – tenacity is a critical element.  But let’s be clear.  Getting past “no” is the easy part.

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July 7, 2010 / companystarter

What Does Tangible Mean To You?

It’s the holy grail of cause marketing: tangibility.  The idea behind tangibility seems simple – create a giving program that means something to the consumer so it’s easy to understand and meaningful.  Cone calls it a fundamental that resonates with today’s consumers.  Not tangible means not sellable means not profitable.

Examples of tangible programs exist everywhere (Toms Shoes, Nothing But Nets, etc).  Goodwill just blew me away with their latest website – plug in your potential donation of computers or coats or whatever and find out how you just helped a person get a job! We’re no exception.  As we build our product and partner with nonprofit organizations, we weave tangibility into everything we do.

Yet tangibility takes on many different forms, and as we discuss with our partners, we find that there’s no simple definition, little marketing data to back up decisions, and a lot of gut instinct.  In fact, we struggle to wonder what tangible means to the consumer who’s only looking at the product for a few seconds or minutes.

Does Tangible Mean Direct Impact?
What makes donating shoes or buying nets so compelling is that there’s a very human one-to-one correlation – your individual act of purchasing helps another individual directly.  But the real challenge is that most issues in this world don’t conform to that one-to-one small-scale act of giving.  What do you do if you’re saving a forest?  Or contributing to cancer research?   Or what if the cost of helping one person is far higher than the cost of the product being purchased?

Does Tangible Mean The Consumer Relates?
The other day my wife* was at Safeway, where they asked her at checkout if she’d donate a dollar to prostate cancer research.  Her first thought was, “That can’t happen to me.”  Then she thought about the men in her life – her son and her husband – and realized it very well could happen to her.  She hit “yes.”  But is research very tangible?  Can you say, “With my contribution I helped save a life?”  Maybe consumers do think that.  But then the question is – did they donate because they felt that cancer research was important or did they relate to the type of cancer?  Same question for Komen and their pink ribbon. People relate to and understand breast cancer.  Komen’s partnerships are everywhere, but does anyone know what their dollar buys?

Does Tangible Mean There’s an Opportunity for Service?
Cone’s 2008 Behavioral Cause Study identifies  5 types of cause conscious-consumers.  Two of them (advocates and activists), together 43% of the population, show signs that for the right cause and campaign they would get involved.  Disney tapped into these folks with their Give a Day, Get a Disney Day program.  Participants got a free ticket if they volunteered for a day.  What’s more tangible than that?  Good, hard work always results in greater knowledge, understanding, and cohesion.  That’s a win-win.  But what if folks buying a cause-branded product want to get involved?  Will they be drawn to research programs?  Will they be excited by an organization operating out of their region?  Tangibility for them means something else entirely.

Does Tangible Just Mean Well Defined?
So what about the idea that tangible just means you know where your money goes?  That instead of donating to Aid Relief you’re donating to Haiti Disaster Relief?  Or instead of donating to fight poverty you’re donating to the local food shelter?  Or instead of donating to a cancer research org you donate to a particular research program within the org?  Is this approach really tangibility?  Or does this fall into that other important arena of cause marketing: transparency?

The Answer: It’s All Tangible, but…
Well, I don’t know if this is the answer, but I do know that all these things are tangible.  The real issue is not whether or not the money is going to have tangible benefit, but whether or not the consumer knows or understands anything about the nonprofit or issue being promoted.  And in cause marketing, it’s a huge risk to assume that the consumer does know, because if they don’t, they won’t buy.

The Real Issue is Relatability
What we’re trying to get at with tangibility is how well does the consumer relate to what we’re promoting? Do they have experience with the cause or the nonprofit? Have they been personally affected by the cause they are contributing to? We’ve identified three reasons a consumer may not relate:

  • They don’t know or never heard of the nonprofit
  • They don’t understand what the nonprofit does or how they do it
  • They can’t relate to the cause itself

In all of these cases, the consumer needs to be educated.  And on the front of a package, in a short commercial, on a sign at checkout, there’s scant room for a full-blown education.  And thus, marketers need to make tangible something that consumers don’t relate to.

Which Brings Us to Equivalencies
“Equivalencies” bridge the gap.  Nonprofits and companies pore through their programs and figure out how much money it might take to provide a simple but impactful act.   It might cost $20 to save a flock of ducks over at Heifer.  Or for $75 you can save a mile of ocean at Conservation International.  Equivalencies are awesome because they allow people to relate through the power of tangibility.

Most of the time equivalencies are just representations.  Consumers need to know their money won’t go specifically to those causes being promoted, but most likely to unrestricted funds which the organization can use any way they like.  No problem there – we trust nonprofits to be good stewards of our donations and you can check on Charity Navigator or the BBB to see if they are.  But the fact remains that equivalencies are for marketing and not for programming.

Ugh
Have you noticed that we’re right back where we started?  Reask the questions above but insert “relatable” for “tangible” and the same confusion ensues.  For different consumers, different issues relate.  And so the real answer is “it depends.” It depends what your causes are.  It depends who your consumer is.  It depends what channels you have to educate your market.  Like all things marketing, you have to know your product and the environment in which you’re selling, and then adjust the message accordingly.

I’m sure I’ll develop stronger opinions as we bring our product to market and start really giving back to our nonprofit partners.  In the meantime, I’d love to learn from your thoughts and experiences, so please share.  I’ll come back to this with lessons learned, somewhere down the line.

*Special thanks to my dear wife who lent her cause-marketing brilliance to this post.

June 27, 2010 / companystarter

Entrepreneurship: Take the Good with the Bad

Sometimes (or, probably, most of the time) entrepreneurship is just the ability to roll with the punches.  As we get closer and closer to launch, that lesson presents itself to me again and again.

We’ve had great successes in the past few months.  We had great successes this past week.  Since the beginning of the year, we’ve finalized our logo, label, and overall brand identity; identified and pitched to multiple nonprofits; identified, contracted with, and began working with several manufacturing companies; and overall developed a product that has everyone who knows about it buzzing with excitement.  Including us.

And yet sometimes I feel like I’m in that dream, the one in horror movies where you’re in a hallway, running to the end, but the hallway keeps stretching just out of reach.

Yes, last week also presented a new setback, one that will delay production at least a month, cause a slight rework of our label, and ultimately delay our sales.  It is, needless to say, frustrating.  We’re finally so close, everything is falling into place, and then… delay.

And yet for the first time I don’t really care, and I’ve spent the whole weekend proud of that, reveling in it.  I don’t mean that I don’t care what happens, or that I’m not going to solve it.  I just mean that I didn’t let it ruin my weekend.  I evaluated the situation, understood the new environment, adjusted our timeline, and moved on.  It’s almost like a sunk cost – getting mad won’t change the situation.  Yelling and screaming won’t get our time back.  The only way forward is with rational thought ensuring that we maximize the next few weeks to solve things as quickly as possible.  In the meantime, I had a great weekend with my family, playing outside, BBQ’ing with friends.  Easily could have been distracted.

It may even turn out for the best.  The last two major setbacks we experienced resulted in new ideas, a better product, and a better way forward.  When times felt desperate, two weeks later we were in an even better place.

And that anger would only cloud the major successes we had last week – pitched to two new potential partners, ordered and shipped raw goods, and received other great news.  All in all, it was a great week and a little setback can’t make that go away.

So the lesson here today – be fanatical, be extreme, be the driving force that all the pundits say you should be.  But don’t sweat the small stuff, and don’t lose sleep getting angry over the past.  Just move forward, stay focused and strategic, and the universe will right all things wrong.

June 23, 2010 / companystarter

The Entrepreneur 24

I’ve been an entrepreneur now for nearly 10 years.  In that time I’ve worked with a lot of people, many of them excellent.  But all that experience has taught me one thing – not everyone is an entrepreneur.  In my experience, it comes down to time commitment.  How much time is someone willing to put into their venture, to get into the details, to really do the job they need to do to get their company launched and operating successfully?

The answer is that most people, even those with the best intentions, are not able to do it.

So I’ve been on an exploration of sorts, trying to figure this out.  Not just because I’m curious but because I want to partner with the right people from now through forever.

I’ve recently come across two fantastic blog posts that shed light on this.  They’re great on their own but truly awesome when read together.

VC Mark Suster’s excellent series on Entrepreneur DNA explores 12 characteristics of an Entrepreneur he’s encountered over his career.  If you haven’t read it, it’s fascinating, but it all boils down to an amazing degree of precision and tenacity that’s required to understand every facet of your company and the competition.  I really enjoyed seeing a lot of myself in his posts.

Meanwhile, just last week, Jonathan Fields posted The 12 Dysfunctions of an Entrepreneur.  Almost as an answer to Marc’s series, Jonathan explores 12 of the worst character traits that entrepreneurs tend to exhibit.  Sadly I also see a lot myself in Jonathan’s posts.

Urgh…  I mean, what’s a well-intentioned, detail oriented, tenacious guy supposed to do to make sure he doesn’t bring himself down with his built-in negative instincts?  All I can think of is… explore them!

So over the next few months I will post a regular series on each of these 24 characteristics, the good and the bad.  I’ll think about how they pertain to me, how they pertain to the folks around me, and try to come to some conclusions about how to maximize the good ones and off-set the bad ones.

Through it all I’d love to hear your opinions, your stories.  Please submit them.  Are these traits really right and do they have to all come in one package to be an entrepreneur in the classic sense?

Looking forward to seeing where this one goes…

June 18, 2010 / companystarter

Lessons from Today’s Meeting

Should I contain my excitement?  Today’s meeting was OFF THE HOOK!  Honestly, it couldn’t have gone better if we had scripted every minute of it.  From my team’s interaction, to the fun back and forth with the nonprofit team, to their comments, everything was perfect.

So what did I learn from this?  A few important things:

1. Transparency really is key.
As we predicted, emphasizing transparency was really important.  As it turns out, they are huge proponents of transparency as well and even bragged that previous corporate partners had called them the most transparent organization they’d worked with.  They told us, “so much of cause marketing is smoke and mirrors, and it’s so important to be ahead of all that, and we see that’s important to you, too.”  BAM!

2. It pays to be detailed.
I don’t want to be immodest, but our presentation rocked.  We filled it with real facts, real analysis, and a real statement of how we’d manage the partnership.  What was the response?  “Normally as a rule we’d shy away from startups, but we can tell you guys are really serious and have a great business and a great team.” BAM!

3. Every interaction is an opportunity to learn.
We know a lot about these guys, but it’s all third-hand analysis.  We’ve barely talked to them.  Well, now we’ve spent an hour and we know A TON more. In just a few moments, we learned about some of their other partners, their long-term aspirations, what’s important to them, how they choose new partners, and what their timeline is for the next 3-6 months.  That’s all information we can use to build our relationship, establish impactful campaigns, and drive more value for both organizations.

4. Stick to your guns.
In the Q&A section, only one question really made us pause: “Will you offer us exclusivity, or will there be other partners?” Crickets.  All on the phone and with no face to face cues, it was impossible to know what each of my partners thought was the right answer.  Then my partner says, “Ian…?” To which I said, “Well, we’ve considered that, but the answer is no.  We expect to take on more partners as we grow and we won’t offer exclusivity.  That said, keep in mind that each new partner will be strategic and will add value to the brand, with the overall goal of increasing sales.  So we will add partners only when there’s an opportunity to really grow the pie, so that each organization’s share is really improved as a result, even as a smaller percentage.”  No opposition at all… a perfectly acceptable answer and they were happy with the honesty.

5. Add value, all the time
We are not running a cause marketing campaign.  We are not running a cause-related contest.  We are building a cause-related brand with giving and advocacy at its core.  We want to build real, long-term relationships with our partners that will develop friendship and trust.  We want them to know we’re sensitive to their challenges, their resource constraints, the demands on their time, and we want to work with them to find innovative solutions to all our needs.  They couldn’t have been happier to hear it, and seemed perfectly pleased to hear a company talk about mutual benefit.

6. Remember, it’s just the beginning.
We haven’t signed anything yet.  They still need approval from the top.  Further challenges will come.  We need to stay focused, stay responsive, and continue to knock their socks off even as we move on to meet the countless other tasks, meaningless and meaningful, that we need to perform to launch this product.  Only in our actions will we build the trust we seek.

June 17, 2010 / companystarter

It starts tomorrow

Well, actually, it started a long long time ago.  But tomorrow we host our first formal partnership discussion with a nonprofit.  We will be pitching to an inspirational educational organization helping low-income and disadvantaged preschoolers across America achieve the same literacy and socialization levels as their better-off peers.  They have volunteers in more than 10 states who’ve donated millions of hours and helped tens of thousands of kids.

I will have plenty of lessons to share tomorrow, but heading into this conversation, let me tell you what we focused on and what’s important to us:

Who Are We?
Yes, this is the elevator pitch but it’s also a first impression, a way to let them know what our company is about and to begin finding a direct connection to them.  It’s also an opportunity for us to present ourselves in a way that’s directly relatable to them, based on what we know.  For example, they have spent real time learning about and investing in mobile applications.  We discuss our mobile application immediately.  I’m betting there will be smiles around their conference table when we talk about it, and they’ll feel a direct connection.

Why this nonprofit?
This seems so obvious but I think it must be forgotten frequently.  We didn’t just pick them out of a hat.  We invested in a 6 month review to establish our own nonprofit evaluation process and vet a number of high-velocity nonprofits.  They rose to the top of a very competitive crowd.  So many companies choose nonprofit partners without getting to know them first.  We’ve read their tweets, watched their videos, evaluated their finances, and more and more.  We really do know them, and we want them to know that.

The partnership as we envision it
This is where we hope to set ourselves apart from other cause marketing partners they may be reviewing.  We know the pressures nonprofits are under and we know what they have to do to activate their partnerships.  For-profit partners can be extremely difficult and misunderstandings occur all the time between partners.  We want to avoid all that and offer them a long-term relationship that will flourish through mutual respect and shared goals.

To that end, we’re offering up the world, and asking for very little.  We will give $.25/product sold, of course, but on top of that we’re committed to driving awareness to increase additional donations, gain supporters, build community, and solicit volunteers.  We’re committed to full transparency to augment the ongoing halo effect and let the universe know that we’re serious, we’re honest, and we’re happy to share all that we do.  All that, and all they have to do is work with us on some messaging points.  The burden is on us!

Of course, we want to develop the partnership over time and increase their involvement.  We at least want them to talk about us on Twitter, for example.  But that’s up to them to decide, and up to us to prove our worth.

All of the above is outlined in full view for the presentation tomorrow.  We think we’ve got a compelling story, a strong offer, and a really neat idea.  I’ll come back tomorrow and let you know how it went, and what I learned in between.