Category Archives: Business Planning

Becoming an Entrepreneurial Expat

Becoming an Entrepreneurial Expat

Thinking of launching a business abroad? Here’s what you need to know.

By Michelle Goodman

From Entrepreneur.com

After working in Mexico City as a manufacturer’s representative for two years, Elizabeth Helsley thought about returning to her hometown of San Diego to start her own company. Then she ran the numbers and discovered that bootstrapping her business in Mexico would drastically reduce her overhead. She decided to stay.

“The cost of living here is so much cheaper,” says Helsley, who launched Global Luxe, a firm that helps manufacturers enter the Mexican market, this spring. “I just moved into a really nice place with three bedrooms, and I’m paying less than $800. In San Diego, the same place would be $2,000 a month.”

But she’s not just saving on room and board. Her operating costs are also significantly lower.

“Here, I can hire an accountant for $20 a month,” Helsley says. Also cheaper: legal services, printing costs, trade show fees and, most significantly, corporate taxes. (According to KPMG’s latest “Competitive Alternatives” report, Mexico’s business taxes are 40 percent lower than those in the United States.)

For Helsley, the financial boon wasn’t the only detail that tipped the scale in Mexico’s favor. She already spoke the language, had a large network of professional contacts and had no trouble obtaining a long-term visa.

Of course, not all regions roll out the red carpet for U.S. entrepreneurs. Depending on the location, you could face difficulties getting a long-term visa, cutting through regulatory red tape and keeping as much of yourrevenue as you’d like.

Emigration 101
Among your top concerns should be whether you can legally emigrate to the country you’re considering.

“Most of the industrialized, more advanced countries tend not to just let people come and open up shop,” says Christopher Uzpen, a partner in the international tax group of law firm Withers Bergman LLP.

In other words, unless you’ve first established residency by living or working in your country of choice, nabbing a long-term visa can be easier said than done.

Cory Kidd, founder and CEO of Intuitive Automata, a health-care robotics startup based in Hong Kong, knows this firsthand.

Although getting his initial employment visa after setting up his company’s legal structure in 2008 was a snap, renewing it each year has required jumping through hoops.

“Hong Kong Immigration appears to be used to granting visas for employees of large, well-established companies but not for startups,” Kidd says–this despite the fact that his company employs 11 people, received a $250,000 interest-free loan from the local government, belongs to a local business incubation program and has raised a small round of angel investments.

Get the Lay of the (Foreign) Land
China, India, Brazil, Russia and some parts of Africa are among the more difficult startup locations for Americans, says Larry Harding, founder and president of High Street Partners, an international business services firm. And with the exception of the UK, he adds, doing business in the European Union can be pricey. (On the flip side, Harding calls starting a business in Hong Kong, Singapore or Japan “relatively straightforward.”)

Even if a region does welcome foreign entrepreneurs, the local infrastructure may not live up to U.S. standards, especially in developing nations.

“Here, we take it for granted that if our business is broken into, we can call the police,” says Bruce Bachenheimer, clinical professor of management and program director of Pace University’s entrepreneurship program. “But in other countries, the rule of law may not be what we expect.”

Likewise, Bachenheimer adds, in some locales, the roads, electricity, phoneservice, internet service, shipping companies and court system may be sorely lacking.

For Danny Wong, a partner with Blank Label, a Shanghai-based custom dress shirt company, doing business in China means accepting that the local government restricts internet access to many blogs and social media sites.

“We’re okay with that,” says Wong, who originally hails from Boston. “But ifyour business is heavily reliant on interactions on blogs, Twitter and Facebook, then China is not an ideal location for you.”

Play Location Scout
Obviously, doing the necessary recon before you relocate is a must. Embassies and trade missions in the United States are fine places to start. So are the chambers of commerce and U.S. embassies in your target location, many of which you can mine for introductions to other business expats, as well as referrals to local attorneys, accountants, business advisors and banks.

But international entrepreneurs say nothing beats visiting your target location and immersing yourself in the culturebefore taking the permanent leap.

“I came here three or four times before starting the company,” says Kidd, who began visiting Hong Kong five years ago. “The first was a vacation. The second was to start considering it as a startup location. I stayed in an apartment instead of a hotel to get a better sense of what it would be like to live here. The last visit or two was networking for setting up the company.”

Learning the local tongue can only help open those professional doors, says Helsley, who’s fluent in Spanish.

“You really have a deeper understanding of the culture if you learn the language,” she says. “You can pick up on things that you might not pick up on otherwise.” For example, she says, “In Mexico, a lot of times when people say ‘yes’ they really mean ‘no.'”

Adopt Local Business Practices
Along with the required permits, registrations and business licenses, you need to suss out the local labor laws and employment practices ahead of time.

“In some places, the labor is relatively cheap, but the churn factor is 100 percent,” Harding says.

For insider info, he suggests asking other business expats questions like: How challenging is it to hire local people? Where’s a good place to find them? What are the employment costs? What’s the turnover like?

“It’s a matter of figuring out all the details and nuances–simple things like the structure of an employment agreement, how to recruit candidates, how to motivate and incentivize employees,” Kidd says.

Cultural attitudes and regulations surrounding work-life balance are another consideration, Harding says. Working 80 hours a week to launch a startup might seem completely natural to you. But in quality-of-life-conscious France, he says, expecting that much overtime from employees won’t fly.

Follow the Financial Trail
The low overhead that enticed you to launch your business overseas won’t do you much good if you sacrifice your savings to unfavorable exchange rates, repatriation rules and tax regulations. For this reason, say entrepreneurial expats, enlisting the services of a local tax professional is critical.

“You want to have any taxes you pay in a foreign country reduce the taxes you pay in the United States whenever possible,” Uzpen says. What’s more, he adds, you want to keep your tax bill in mind when choosing a legal structure for your business, as the structure you select likely will affect the amount you owe.

“Ultimately, you don’t want taxes to drive how you do business,” Uzpen cautions. “But as an American, you’ve got two jurisdictions to worry about, which a lot of entrepreneurs from other countries don’t have.”


Michelle Goodman is a freelance writer and author of My So-Called Freelance Life: How to Survive and Thrive as a Creative Professional for Hire.

10 Great Seasonal Summer Businesses

10 Great Seasonal Summer Businesses

See the slideshow at Inc.com.

What makes Hawaiian Rumble, in North Myrtle Beach, South Carolina, worthy of hosting the Masters of mini golf? A 40-foot volcano that shoots 15-foot flames. “It rumbles so loud, it shakes the ground,” says owner Robert Detwiler, who also started the U.S. ProMiniGolf Association.

Vegetable gardeners can thank 19th-century entrepreneur W. Atlee Burpee for their fresh corn on the cob and juicy homegrown tomatoes. Young Atlee’s father wanted him to be a doctor. But Burpee was drawn to the fledgling science of genetics. In 1876, at 18, he founded a mail-order-catalog and seed business, the W. Atlee Burpee Company, in Warminster, Pennsylvania.

Woodworker Herbert W. Sellner’s Tilt-A-Whirl was the hit of the Minnesota State Fair in 1927, one year after its debut. Since then, the carnival ride has thrilled and nauseated countless riders around the world, and it is still a bestseller for fourth-generation family-owned Sellner Manufacturing Company, in Faribault, Minnesota.

How do you make perfect lobster rolls? Practice, practice, practice. Try serving 10,000 of them, as Shaw’s Fish & Lobster Wharf, in New Harbor, Maine, does every summer.

Kerry Bexley works as a facilities operator at a coal plant and “Miss Tootsie” Tomanetz is a custodian at a local school district, but on Saturdays they run Snow’s BBQ, in Lexington, Texas, which is ranked No. 1 in the state by Texas Monthly. Fans start lining up at 8 a.m., and Snow’s usually sells out by noon.

The Black Hills Central Railroad travels through the mountains of western South Dakota. The Warder family bought the railroad in 1990 and refurbished a Baldwin Mallet locomotive. Trains run from Hill City to Keystone on a route that once served the region’s mining boom.

Inventor Gordon Holcombe once worked in the commercial aircraft evacuation business. When the first DC-10 jumbo jet came out in 1971, he realized the curved slides used for emergency exits could be adapted to make river rafts. He founded raftmaker Maravia, which subsequent owner Doug Tims moved from California to Boise, Idaho, in 1985.

The year was 1952, and George Stephen Sr. had an idea: Why not use one of the metal buoys he was welding for the Coast Guard as a barbecue grill? He slapped on some legs and a handle, and the Weber grill was born. Today, Weber-Stephen Products, in Palatine, Illinois, is the largest grill manufacturer in the U.S.

Tom Morey was a math major at the University of Southern California when he started to rethink the surfboard. Morey’s Boogie Board (named for his love of music), trademarked in 1973, was eventually bought by Wham-O. His latest venture, TomMorey.com, in San Clemente, California, is at work on a new kind of paddleboard.

In 1956, James and William Conway drove the first Mister Softee truck through the streets of South Philly, where they grew up. Today, their sons, James and John, run the franchiser, based in Runnemede, New Jersey. Some 750 trucks, each playing the instantly recognizable Mister Softee jingle, cover 18 states.

Opinion: Startups Should be Colocated

Startups Should be Colocated

By Francine Hardaway

From FastCompany.com

Editor’s note: This blog is written by a member of our expert blogging community and expresses that expert’s views alone.

Long before I went to China and got to know Mark Suster, I read and admired his blog.He’s one of the new generation of open, transparent VCs. So it’s not surprising to hear him come out in favor of colocation for startups. He’s right. Distributed teams may work, but colocated startups work faster, quicker, better. And if there is only one founder, they may be the single best way to get a good business idea the resources it needs to get off the ground (which is often a cofounder to begin with).

I’m not talking through my hat here. Stealthmode works out of a collaborative work space in Chandler, Arizona called Gangplank, and also run a startup incubator in Mesa, a town nearby. The Chandler startups are mostly creative and geeky, (Authority Labs is one of them) and the Mesa ones are health-related, retail, and Web services.

In every case, the businesses have made huge strides by “living” together, using each other’s talents and services, learning from each other, and being exposed to the same group of educational resources and mentors.

A large part of helping companies is simply mentoring. I’ve done it for the past ten years both privately and as part of job generation and retention programs. It is VERY labor-intensive work, and there are only three of us at Stealthmode. If we didn’t aggregate groups of entrepreneurs and allow them to learn from each other–as well as from the resources who donate their time to the collaboratives (investors, lawyers, accountants, and yes, social media gurus)–we couldn’t scale what we do. Because of the collaboration programs, we’ve been able to help over 400 businesses get started, grow, or stay in business during this downturn.

After all, there are only 24 hours in every day. Even the best-intentioned VC, angel, or attorney can’t give all the time they’d wish to give. So a colocation facility, where the resource can be brought to the facility for an hour of answering questions, can go quite far among ten companies.

In times of scarcity like the one we are in now, it’s important to form new businesses. Most hiring is done by businesses less than five years old. Those are the ones that gravitate toward the acceleration programs we are part of. They’re the best, the brightest, and the bravest of entrepreneurs. There may not be bank lending for them, or VC money (most companies aren’t eligible for VC money), or even seed money, but lowering their startup costs by sharing resources can make it possible for them to succeed.

We try not to call our colocation or collaboration “incubation.” My long-time business partner says “incubation” has the connotation of sick babies. The companies that self-select to come into the Kauffman Foundation FastTrac programs we offer at the colocation facilities every fall and spring are not sick: they’re companies that have decided to take advantage of every resource the community has to offer, and not to pre-judge their competitors or their complementors.

After ten years, our network of businesses have formed a “trust” network and often buy from each other or use each others’ services. I’ve never led a program that didn’t have a Web developer as a participant, and two or three businesses that had Web site issues:-)

In Mesa, where the businesses are less technology-centric, we have had businesses that needed graphic design services, and people who needed massage therapy. And surprise: we had a massage therapist, a yoga travel business, and a graphic designer. Also a gentleman who raised money for health related businesses, a woman who spoke on defeating cancer by natural methods, and a real estate specialist. None of them could have attracted a dime of bank financing or venture capital, and yet they are all off the ground and generating revenue.

This colocation idea works, both in technology-specific businesses and in unrelated random groups of small neighborhood businesses. To get ourselves out of this Recession/Depression, we need both.

Video: Business TV: Why youth culture matters to business

Business TV: Why youth culture matters to business

Hear expert business advice from Anastasia Goodstein, Author and Founder, Ypulse, as she talks about the importance of youth culture to business and more business marketing tips for those eyeing Gen Y.


Anastasia Goodstein: The first is that youth culture really defines the popular culture, so whatever is really hot and happening with young people ends up being what’s hot and happening in fashion, in music, in internet, in entertainment, in the culture that we all consume. I think the other reason is because it’s your next generation of consumers. Even if you’re making a product that isn’t necessarily geared towards them right now if you’re not thinking about how to reach them your audience is going to die out. Again I sort of referred to the network news, at least in this country, the US, you know the average age of the nightly news viewer is someone in his 60s which is why all you see is Viagra ads when you watch the nightly news.

If they want to reach the next generation of consumers they have to sort of understand the culture that they’re coming from and the media and entertainment that they’re consuming

See more business news television shows featuring these experts, as they give their top expert business advice at http://www.yourbusinesschannel.com

Turning a Part-time Passion Into a Full-Time Enterprise

Turning a Part-time Passion Into a Full-Time Enterprise

A part-time business gives you the opportunity to develop your business model and learn from your mistakes. As your business grows you reach a pivotal moment: Do you maintain the status quo or push the envelope and go full time?

By Susan Solovic

From FastCompany.com


Twin brothers, Randy and Jeff Vines, grew up in the suburbs of St. Louis, but fell in love with the history, culture, diversity, and even the quirkiness of the city of St. Louis at a very young age. On Saturdays, while most teenage suburbanites were hanging around shopping malls, the Vines brothers would hop on a city buss and spend the day producing a local access television show on city life. “The people in the city are just a notch above. They have swagger you just don’t see everywhere,” explains Randy Vines.

While away at college, the brothers wanted to display their civic pride and show-off the uniqueness of their beloved city, but the only apparel available was the typical tourist attire. Back in St. Louis with traditional jobs, the Vines brothers continued to long for edgy, trendy apparel depicting the colorfulness of St. Louis City. So they decided to create their own.

“When we would wear own designs we’d be asked by strangers on the street where did you get that shirt,” remembers Jeff Vines. “So we did a small run and then signed up to have a booth at some downtown festivals and we always would sell-out quickly. We learned real quick what people wanted.”

That was the beginning of STL-Style. Mostly selling out of boxes from the back of their car, the Vines’ t-shirt creations became a big hit garnering extensive press coverage, including an article in The New York Times. Soon people were ordering from around the world and it was difficult to keep up with demand. While continuing to work their “day jobs”, the two committed nights and weekends to their burgeoning business. “There weren’t enough hours in the day. We had to hire our friends to help out part time and it became a matter of whether we are going to keep treading water and doing what we are doing or are we going to take this to the next level and get serious about it,” Jeff says. It’s a pivotal point many part-time business owners face.

After nine years of part-time operations, the Vines twins decided to turn their part-time passion into a full-time enterprise. Randy and Jeff Vines waited until the business basically directed their decision for them–STL-Style had gone as far as it could go as a part-time endeavor. A part-time business gives you the opportunity to develop your business model and learn from your mistakes. You have a history and a customer base from which to grow which enhances your chances for success. As Randy notes, “I think more and more the culture in America is about doing less conventional approaches to earning a living. More than ever there is this excitement about entrepreneurialism and people are figuring out a way to turn their passion into dollar signs.”

How to Attract Talent to your Startup

How to Attract Talent to your Startup

By Issie Lapowsky

From Inc.com

Employees are valuable. So are referrals. That was the thought behind Meebo’s decision to offer a $5,000 reward to anyone who referred qualified potential employees to the company that launched in 2005. The only stipulation? People would only get paid if the candidates got hired.

As an instant-messaging and social media service, Meebo never really had trouble finding and attracting talent. They offered employees referral bonuses, posted on job boards and committed themselves to so-called “guerilla recruiting.” But they realized, some time in May of this year, that they had 10 high-level jobs to fill and they hadn’t been using all of the resources available to them to find the best talent. They hadn’t yet reached out to their massive user network.

So, Vice President of Human Resources Tom Perrault and his team decided to offer the public the $5,000 prize.

“Good talent is going to make the difference in the growth of our organization and in the future,” says Perrault. “So we’re willing to pay for good talent.”

The referrals the company got, especially from vendors and external partners were, in Perrault’s words, “spot on,” and the experiment was a success. The moral of the story, though, is not that you have to throw money around to attract top talent.

Instead, the takeaway message for recruiting is: play to your strengths (in Meebo’s case, it’s networking), be active, not passive, and get your name out there. This guide will provide a few recruiting tips, as well as what to look for in a new hire and how to entice the best talent.

How to Attract Talent to Your Start-up: Face-to-Face Interaction

No matter how small the internet has made the world, experts still recommend in-person networking as the No. 1 way to recruit talent.

“I’ve done a lot of placing people into positions, and I have never used a job board as a way to do that,” says Rich Sloan, co-founder of StartupNation. ‘Personal [interaction] is so much more powerful and important to me.”

Start at your local Chamber of Commerce, which should list information on industry events happening in your area. Don’t stop there, though. Research local industry groups and associations. “Every type of business has their own meetings,” says Martin Zwilling, founder and CEO of consulting group Startup Professionals. “You’ll find people who know your business and are looking for opportunities.”

Even if you don’t find employees at these industry events, you will at least make contacts who understand your needs and will put you in touch with other people they know.

Or, you could create your own networking events, as Meebo did. Perrault says the company started scheduling Meebo meetups around the world and asking fans and users to come out to rub elbows with the Meebo staff.

“We’d say, “Hey, we’re going to be in Chicago. We’re going to be in Japan. We’re going to be in New York. If you’re interested in Meebo, come to XYZ coffee shop,'” he says.

At these events, they hand out cupcakes and t-shirts. Once, one of Meebo’s founders even played JavaScript bingo with people who showed up. They wanted to give guests a memorable experience because, says Perrault, “It wasn’t just about recruiting. It was about building a community, and people who show up to those things have a heightened interest in Meebo.”

Even if you don’t have a huge network of people to advertise your meetups with, you can always try becoming an official Meetup group to get the word out.

And don’t forget about schools and universities. Job fairs abound, so it’s wise to get in touch with career counselors at both local schools and schools that have high-performing graduates in your field to see how you can get involved.

“Every university makes efforts to get interconnected with the entrepreneur community,” Zwilling says. “They have outreach programs, and the people who are involved are the people who will find you interns and people who will be graduating soon.”

Meebo judges and sponsors programming competitions at schools like MIT, Stanford and Berkeley, so they can see firsthand where the real talent is.

Dig Deeper: How to Improve Your Hiring Practices

How to Attract Talent to Your Start-up: Use the Internet Wisely

No one wants to sift through endless responses from a job board listing. You may find the right candidates in the end, but you’ll waste precious time separating what Perrault calls “the weak from the champs.”

This is not to say, however, that you can’t find good talent for your start-up online. In the era of social networking, there are tons of sites dedicated to matching qualified applicants with the right employers, includingStartupersVentureLoop and Startuply. You can even try InternshipIN to find people while they’re still in school.

Make sure, when you register for these sites, that your profile reflects the spirit of your company. That goes for your Facebook presence, too. If your business is casual and fun, you’ll need people who are attracted to that type of environment, and your time will be best spent if you find these people from the very beginning.

Dig Deeper: How to Use Social Media as a Recruiting Tool

How to Attract Talent to Your Start-up: What to Look For

“There are certain kinds of people who thrive in an environment with the risk profile and anarchy of a start-up,” says Sloan. “Start-ups demand great working relationships. There can be no issues.”

This means the cultural fit is equally as important as what’s on a person’s resume. Zwilling recommends looking for people who are results-oriented, people who can tell you what exactly they’ve done in their careers. As you probably know already, responsibility gets pretty evenly distributed in a start-up with a small staff. You need to know that people can produce when given that responsibility.

“I hear a lot of people talk about what their job description is, but I’m looking for results,” Zwilling says.

He also recommends looking for someone who is “attracted to the promise of a big win.” The road may be rough at first, but someone who’s ready to see your business through and can tell you why it’s worth it to them is someone you want on your team.

If your business requires long or odd hours, look for someone whose other commitments aren’t going to prevent them from contributing. And, most importantly, you should steer clear of people who list being tired of the corporate world as one of their main reasons for applying. That doesn’t automatically mean they’re ready for the start-up world, either.

Preempting these issues is key, so Sloan suggests putting all potential employees through a training session. He says, “The test period will reveal what the dynamics really are.”

Dig Deeper: The New Rules of Hiring

How to Attract Talent to Your Start-up: What to Offer

As a start-up, you might not be able to offer top talent all the benefits and employee perks that a big corporation can, but what you can offer is the promise of purpose and independence.

According to Sloan: “People get involved in a start-up for three reasons. One, they like creating, being part of something new. Two, they want to participate in the upside. Three, they want to live a meaningful life, and the closer you are to the success or failure of a business, the more meaning and purpose you feel.”

Without a corporate ladder to scale, employees at start-ups can also start out with higher job titles, which can be a big incentive for driven individuals.

No matter how driven a person is, though, he or she will still want to be reassured that the company will be around a few years from now. Sloan suggests being open about your financial situation, discussing your business plan and demonstrating knowledge about your place in the industry. You don’t want your new hire to face any surprises during the first few weeks.

In addition to promising purpose and more important roles, many start-ups have another secret weapon to help them secure top talent: a casual and fun working environment. If you’ve got one, don’t be afraid to show it off. Meebo puts all its new hires through a three-hour work simulation, in which new hires not only get to demonstrate their skills, but they get to see how the office operates day-to-day.

“If we get them in the door, we have a fighting chance,” says Perrault. “When we do the debrief, every single person says, ‘It’s so easy to see the enthusiasm of your employees, and it’s infectious.'”

Dig Deeper: 10 Employee Perks We Love

How to Attract Talent to Your Start-up: Always Be on the Lookout

Don’t lose recruiting momentum just because you’ve filled all current positions. “Even if you don’t have an opening right now, eventually you’ll have an opening, and you need to get people interested, so by the time you’re ready, they’ll want to join you,” Perrault explains. “If you’re not recruiting all the time, you’re not doing it right.”

Sloan suggests keeping a running list of all the people you meet or hear of who impress you. He calls it a “Superstar list.” “It’s good to always keep track of outstanding people,” he says, “because you never know how or where you can plug them in.”

Even when you’re not actively recruiting, you can still engage talented people in non-traditional forums. Meebo posts JavaScript puzzles on its site, and every once in a while, when someone does particularly well, Perrault’s team may contact that person to discuss job opportunities at Meebo.

“It’s so clear to everyone here that recruiting is not just an HR job. Everybody here understands recruiting is the lifeblood of our organization,” Perrault says, “and that makes for a richer and stronger recruiting process.”

Risk Assessment: The World’s Riskiest Companies

Risk Assessment: The World’s Riskiest Companies

By Matt Buttell

From MeetTheBoss.tv

Amidst the global recession of the last two years, the news of profit losses, job cutbacks and business closures soon became a daily occurrence. While the meltdown of the global banking sector spearheaded the headlines, the ensuing impact on our daily lives really took effect as the recession hit our retailers hard.

With everyone across the world tightening their belts, it became something of a no-brainer that retailers would suffer. Independent retailers all but ceased to exist, as even some of the world’s most recognized and respected brands fell apart under the pressure of the economy. Among some of the many, many casualties were outdoor outfitter Eddie Bauer and skincare specialists Crabtree & Evelyn, with both of these among those that have either been reorganized or liquidated since 2008.

But, according to Forbes, despite two years having passed and the economy (by and large) showing serious signs of recovery, the retail sector continues to face a rather murky outlook. While the early, hectic post-crash devolution of the sector may have all but dissipated, hundreds of business remain on “high risk alert” and continue to “flash financial danger signs” – and its not just the retail sector who are feeling the brunt.

While retailers such as Zale – the Irving, Texas based jewelry retailer – and drugstore chain Rite Aid ride high on Forbes’ “Risk List”, the top end is populated by companies from all industries – including telecommunications, the energy sector, the financial services industry and shipping and freight services.

The Forbes Risk List, as rated by the Accounting and Governance Ranking system, collates those businesses that are struggling to perform in the current economy. The ranking system is defined as a measure undertaken by Audit Integrity of the transparency and statistical reliability of a corporation’s financial reporting and governance practices. According to its output companies ranked as either Very Aggressive or Aggressive are much more likely to face class action of litigation and financial restatements, and – most crucially – more likely to suffer sever equity loss.

Of course, if the recession of the last two years has taught us anything, it’s that leading in tough times takes its toll of even the toughest CEO; and in the world of business leaders, there have been many a casualty along the way. (Think Fred Goodwin’s epic downfall as CEO of RBS).

But, for all those leaders who fall at the recession-hurdle, there are leaders who are capable of pushing forward and of leading their company to the foreground of business success. In a recent broadcast on executive business channelMeetTheBoss.tv, for instance, Steve Odland, CEO of Office Depot, explained just why the retailer had remained on top – despite an all-together rocky road during the economic crisis.

In fact, at one point during the crisis, Office Depot stock was pushed as low as 60¢ – though it has now returned to the normal levels, and the company is again riding high. “Anybody who operates in a competitive environment has to believe in themselves and has to believe in the team around them else you simply couldn’t be successful,” explains Odland.

Perhaps some of those organizations of Forbes’ list have passed the ‘Last Exit’ sign on the Highway to Meltdown, and while we are not one to suggest that the blame for such dire straits lies with these companies’ respective CEOs, great leadership – at any level – remains critical to business success. Just ask Steve Odland.

Brooklyn’s Best Entrepreneurs

Brooklyn’s Best Entrepreneurs

By Lars Russell

From Inc.com

Inspired by homebrew recipes he discovered while an Associated Press correspondent in the Middle East, Steve Hindy (left) teamed up with neighbor Tom Potter (right) to found Brooklyn Brewery in 1988. With a logo created by Milton “I ♥ NY” Glaser, and managed and distributed from Brooklyn, the brewery still made its beer upstate until master brewer Garrett Oliver (center) designed and planned the Brooklyn plant in Williamsburg, which opened in 1996.

Rob Kalin, who says he grew up in a “woodshop” and makes furniture and stencils in his spare time, founded Etsy in 2005 as an online place for makers and buyers to connect directly. The online social commerce site specializes in handmade arts and crafts and vintage items. Its offices, which are based out of Brooklyn’s DUMBO neighborhood (Down Under the Manhattan Bridge Overpass), are also home to “Etsy Labs,” where members can take workshops, teach skills, and fashion crafts.

Drop.io, which offers free, secure file-sharing through digital-storage “drops” (and related products like the multimedia-sharing PressLift), was founded by Sam Lessin and Darshan Somashekar in 2007. It moved in 2008 from Manhattan to not far from the Etsy Labs in Brooklyn’s DUMBO, where an East-coast version of California’s Silicon Valley is taking hold in the waterfront district. (Pictured: drop.io’s head of applications Steve Greenwood, in hat, and head of development Jacob Robbins, with green shirt, listening during a “Startup Storytellers” event at the DUMBO office.)

Brooklyn artist Lexy Funk began making messenger bags out of billboard vinyl in the 1990s, from the factory loft where she lived. In 2001 she expanded to her first apparel retail store in the neighborhood of Williamsburg, calling it Brooklyn Industries. Brooklyn Industries now comprises 14 storefronts nationwide and a thriving online retailer. The company’s commitment to local artist-designers, plus organic and post-consumer fabrics, helped Funk win Ernst & Young’s 2010 Entrepreneur of the Year award for the New York area.

Father-and-son property developers David and Doug Steiner grabbed hold of a 150,000 square foot plot on the Brooklyn Navy Yard in 2004, doubled in a 2007 expansion, to create Steiner Studios, a facility which now hosts the largest soundstage on the East Coast and more than 200,000 square feet of office space. Taking advantage of NYC’s filmmaking boom under Mayor Mike Bloomberg, the studios have housed production for “Revolutionary Road,” “Inside Man,” “The Producers,” and more than a dozen other Hollywood films.

Seth Frader worked in the robotics industry and for NASA’s Mars missions before bringing his electromechanical expertise to EnergyHub, the Brooklyn-based developer of “smart meters” to regulate home or office energy consumption. Frader’s kit includes a dashboard interface like a cross between an iPod and your computer’s task manager, giving the user simplicity and control. At the same time, EnergyHub sends data back to utility companies that can improve their grid management, proving a thoughtful entrepreneur may offer solutions to an energy crisis once considered just the domain of large corporations, legislators, and maybe a few environmental extremists.

A hallmark of Brooklyn’s food life this past decade has been diners’ increasing appetite for local, organic produce and the imaginative way city chefs have found to serve them. Brooklyn alone features 600 small community farms, and at least two of them supply Roberta’s Pizza in Bushwick, Brooklyn. Started in 2008 by Chris Parachini, with partners Brandon Hoy and Carlo Mirarchi, the restaurant cooks its pies in a brick oven using fresh-made dough, and relies on its rooftop greenhouse and a nearby backyard garden for seasonal greens.

Vintage buyer Tiffany Porter cultivated over the years a time-leaping collection of nostalgia from roaring flapper to rockabilly to moxie mod. In fall 2008 she opened Old Hollywood in Greenpoint, Brooklyn, to showcase and sell her wares, a boutique fine-tuned by partner Alex Shulhafer. The main display case in the store (pictured) includes a handmade, vintage-inspired bathing suit by Elizabeth O’Brien Berg, a mermaid tail necklace by Audilou, and a taxidermy pheasant, personally caught and stuffed for Tiffany.

From massive outdoor public artwork to rugged iron bar stools in a Lower Manhattan dive bar to a retail display at Barney’s New York, the metalworks created at Ferra can be spotted all over New York and, increasingly, the entire northeastern United States. When founding Ferra Designs in 1989 with Jeff Khan (right), Rob Ferra (left), a blacksmith by trade, set out to infuse traditional techniques with a modern design edge. Today the firm incorporates computerized design and water-jet cutting technology, and today has branched into exotic metals, titanium, and resins, all out of a 10,000-square-foot metal shop in Brooklyn’s waterfront Navy Yard.

It was an experiment: could a standard freezer pop be made healthier, fresher, and sustainably? Nathalie Jordi, David Carrell, and Joel Horowitz proved themselves right by creating treats and shaved ices with locally grown herbs (tarragon, mint) and fruits (strawberries, peaches). After growing their business and a local following at the weekly Brooklyn Flea market, the trio this spring opened a storefront location in Manhattan.

When Lee Silverman hit 210 pounds and found himself out of breath just going up a flight of stairs, he knew he needed a change. He started running, and has been hooked on marathoning since. In 2003, he founded JackRabbit Sports to help others make the same transformation by educating people about running and triathlon “and to make sure everyone makes the best choices in gear.” Employees go through eight hours of training before being allowed to help customers select shoes, and treadmill analysis for shoe fit is standard. What’s more, JackRabbit’s training programs are legendary in the New York area.

Red Hook Lobster Pound boasts that it serves the freshest lobster in New York City – and with good reason: Maine native Susan Povich (pictured) cooks the lobsters that Ralph Gorham drives each week to Maine to select. The shellfish is prepared to order at their Red Hook storefront or one of a number of borough flea markets, street festivals, and city parks where the pair sets up shop. To date the couple has sold more than 12,000 live lobsters and 19,000 lobster rolls.

How Respecting Competition Wins Business

How Respecting Competition Wins Business

What should you say when a prospective customer asks, “How are you different from your competition?”

By Janine Popick

From Inc.com

We sell e-mail marketing services to small businesses like yours. During the course of every day, our amazing Customer Support department gets a ton of the phone calls, asking everything from “How do I send my first e-mail campaign?” to “How are you different from your competition?” We certainly have documents on how we’re different from the competition—but we stick with just the facts when talking to customers. I once got an e-mail from one of our Customer Support team members letting me know that one of our competitors was saying not only wrong things about our services, but mean things.

Being that I’m pretty friendly with most of our competitors, I reached out to them to let them know that I’m fine with them selling against us, but asked if they could just use the proper information. I then gave them the correct information about our services, in case they wanted to give it to their salespeople to use.

Now what did I gain out of this? Well, hopefully my peers in our industry are like me, and they tell their teams to use the truth, and they instruct them on what the truth is. This is especially important when compared with companies like ours who are pretty transparent about what we do and what we offer. If they’re not, I can’t really compete, only tell the prospective customer that that’s just wrong information and they should check it out for themselves.

Honestly, I’d want to be the first know if one of our people was saying bad things about our competition. That’s just not the way I work and not the way I wantVerticalResponse to be viewed. When a prospect asks us how we’re different, we simply point out four points, then we say “Why don’t you test us both out, and find out whose services you like and who you like to do business with. Then make your choice.”

Seven times out of ten, our prospects are so impressed with our reaction and our transparency, they’ll choose us in the longrun. Honesty is really the best policy when it comes to sales in my opinion. Isn’t it?

15 Things Every Business Owner Needs to Know

Running a business requires many skills, from planning for the future to keeping excellent records. Here’s a list of some essentials that every entrepreneur must keep in mind.

From Inc.com


Running a small business is no small task and though it is associated with great freedom, any business owner will tell you that there is also a burden to carry—a burden that has to do with taking care of your family and your investors, of serving your customers and employees, and most of all, of living up to your own goals and ideals. To help you find success as an entrepreneur, we’ve compiled this list of 15 things (some obvious, though easy to overlook, and others less obvious) that you must keep in mind.

1. Always remember: Cash is king.

Cash crunches happen from time to time, but if they are chronic at your company, then you may have to re-think the way you do business. Thoughcash-flow squeezes often seem mystifying, there are only a few explanations:  Your gross margins may be too low, caused by discounted prices or out-of-control direct costs.  Your overhead, including rent and payroll, may be too high. Your payment terms may be too liberal or your billing procedures too slack. You may be tying too much money up in accounts receivable or you have too much debt from nonpaying customers. Finally, it is also possible that you are holding too much inventory.  If you feel tight on cash, investigate each of these possibilities and figure out which one is causing the biggest drain on your bank account.

2. Though cash is king, making money is ultimately an unsatisfying goal.

A business, and the person who owns it, can have a material impact on the world well beyond the dollars attached to it. Moreover, unless your company has a higher purpose, it will be hard to sustain. And we’re not necessarily talking about social entrepreneurship here. We’re talking more simply about having a mission, and sticking to it. Example: One of the most satisfied and respected business owners we’ve met in a long time is Tim O’Reilly, the founder of O’Reilly Media, a company that publishes magazines and books and hosts events. “My original business model—I actually wrote this down—was ‘interesting work for interesting people,'” O’Reilly told Inc.  The company he built is today one of the most forward-looking businesses in Silicon Valley; it delivers on that initial promise, and has managed to thrive despite industry forces that have often been unfavorable.

3. Culture matters.

Zappos CEO Tony Hsieh built his company into an exemplar of great service by first figuring out what he needed to do to treat his employees well. The answer? Plenty of individuality and autonomy, a pride in human weirdness, cheers and off-hours fraternizing, and figuring out how to weed out half-hearted employees before they bring everybody else down. It’s worth noting that Zappos does not pay high wages and the work itself, in a call center and a fulfillment warehouse, is not especially glamorous. Still, by focusing on his company’ s culture, and how it creates a positive atmosphere, Hsieh has built a billion-dollar business.

4. Systems can be humane.

Nick Sarillo of Nick’s Pizza & Pub in suburban Chicago has built his company’s culture by using a form of management that we dubbed “trust and track.” The system defines the basic tasks of the business down to the letter, then trusts workers to consult lists of directions in order to complete these tasks. Sequences are mapped out, but particular duties are not assigned. Workers are expected to take initiative. “Managers trained in command and control think it’s their responsibility to tell people what to do,” Sarillo says. “They like having that power. It gives them their sense of self-worth. But when you manage that way, people see it, and they start waiting for you to tell them what to do. You wind up with too much on your plate, and things fall through the cracks. It’s not efficient or effective.

5. Character is the most important quality to look for in a job applicant.

“In many companies, the person who talks the best usually gets the job,” observesWhole Foods CEO John Mackey. But his view of the skills to look for in a job candidate, especially for a leadership position, has evolved over the years as he has seen confident, fluent employees fall short on the merits of their work. Now, he looks for character over communications skills, and tries to promote from within as much as possible. “I look for somebody who has classic virtues such as integrity, honesty, courage, love, and wisdom,” Mackey told Inc. in 2009. “Someone who is hardworking, candid, and ambitious, while still showing humility. I also look for people who have a high degree of emotional intelligence — a high capacity for caring. I think for leadership positions, emotional intelligence is more important than cognitive intelligence.”

6. To grow, you must first learn to delegate and to trust.

For a business to grow and be healthy, the founder has to trust his or her managers, the managers have to trust their staff members, and so on. Tom Colicchio of the Craft Restaurant Group in New York City has learned this lesson as his business has expanded to include multiple restaurants and a chain of upscale cafés. “In order to open up multiple locations as a chef or a baker, you have to check your ego at the door,” he told Inc. in 2008. “You have to rely on the fact that you can train someone, and that he or she will put his or her heart and soul into the business as much as you would. If you don’t have that trust, it won’t work.”

7. Plan for rainy days.

Jack Stack is a paranoid fellow. The chairman of SRC Holdings, a Springfield, Missouri, business with manufacturing and other interests, puts his managers through a rigorous exercise each year of planning for contingencies that include recession, credit crunches, and various catastrophes. As a result, when the financial crisis struck, and the government bailout of the auto companies hurt SRC’s core business, the company was able to navigate through the uncertain period relatively unscathed. Stack’s advice to today’s entrepreneurs is to always have a Plan B, in part to ensure your survival and in part to spur innovative and creative thinking at your company. “Our values drove our paranoia. Our paranoia drove our contingency planning. And our contingency planning drove our diversification,” he told Inc. in 2009. “We knew the more we diversified, the safer we would be. So we spread out of our core competencies. We’ve spun off 55, 56 businesses as a result of this process.”

8. Working with partners is easier said than done.

A strategic or joint-venture partner can help you company enter new lines of business, and expand at a more rapid clip than you could otherwise. But partnerships are tricky to manage. Make sure you research the reputations of potential partners with care, establish both the big-picture objective of a deal as well as the nitty-gritty who knows what, identify your champion within the other organization, and put in writing a mechanism for ending the partnership amicably.

9. Keeping good records is also easier said that done.

Sometimes the most trivial-seeming matters can really trip you up. For example, many small businesses rely on contingent labor. Though the practice is economical and affords flexibility, it can lead to tax and legal problemsif human resources requirements are not managed carefully. In most instances, it is wise to execute a written contract with each independent contractor you use. The document should spell out that he or she is a contractor, and outline the work that will be completed by him or her—but it should not get into how that work will be completed.

10. To engage workers, let them call (some of) the shots.

Tasty Catering in Elk Grove VillageIllinois, is run by two councils that make major company decisions. One of the $5.3 million company’s three owners sits on each council, as do two employees selected at random to serve. The councils have reshaped the business, changing the benefits package, reconfiguring the org chart, and coming up with a set of steps to respond to the recession. Not every decision goes through the councils—managers reserve the right to promote workers, for example—but the result is a company where worker engagement is palpable and financial performance is steady.

11. Customer service is not a department, it’s a way of life.

At the travel website Kayak.com, co-founder Paul English forces engineers to answercustomer service calls on a regular basis. “If you make the engineers answer e-mails and phone calls from the customers, the second or third time they get the same question, they’ll actually stop what they’re doing and fix the code,” he told Inc. “Then we don’t have those questions anymore.”

12. The best salespeople thrive on rejection.

G. Clotaire Rapaille, a psychoanalyst and ethnographer who lives in Florida, has studied salespeople and finds that the best are those who are somewhat thrilled by rejection. He calls them happy losers. “What we find with good salespeople is that that first no stimulated them,” he told Inc. “It didn’t make them want to give up. It made them want to find another way.” Among the other virtues of happy losers: They try more techniques, they improvise, they take chances—and they don’t believe a sale closes with a yes. They always look to up-sell, and only stop selling when the customer tells them to stop.

13. Knowing how to control clients is an art.

“I think one of the greatest gifts for me professionally and for my clients was to learn the word no,” publicist and event planner Kelly Cutrone told Inc. in 2010.  “Learn the word no and then really have the energy and the experience and the knowledge to sit your client down and tell them not to doing something. You have to be like a good trekker going through Nepal. You want somebody who’s gone to the top of that mountain and who’s going to say ‘Don’t drink all your water because you’re not going to have any here and, around this corner, you might find a man-eating lion.'”

14. Failures are good for you.

Donna Fenn, a veteran Inc. editor and the author of Upstarts, writes that the most successful entrepreneurs are interested in the creative process of growing companies—complete with failures, setbacks, and missteps—rather than the goal of getting rich. “While you most certainly start a business with a big goal in mind, the true value of the entrepreneurial experience comes from what you do every day to achieve that goal,” she wrote in a memorable blog post. “If you love the process and learn from it, then achieving the goal itself almost becomes secondary. In fact, you may discover that your accumulated knowledge can be leveraged more effectively toward an even worthier goal. It’s that laser focus on the process – not obsession with the end goal – that ultimately leads to success.  Great entrepreneurs understand this intuitively.”

15. You need to leave yourself time to dream.

An entrepreneur is, by definition, a creative person. But as your company grows, you are likely to get dragged away from the most innovative, idea-driven parts of your business. Don’t let that happen—at least, not without a fight. Build time into each day to think about your company’s vision, to brainstorm new products, to read for pleasure, or simply to muse about things that might not matter much. “Staying creativeis among the healthiest things a CEO can do personally and for the company,” Inc. contributor Alison Stein Wellner wrote in 2007. “Billie G. Blair, an organizational psychologist and owner of Leading and Learning, a consultancy in Los Angeles, observes that idea generation may be the CEO’s strongest suit, and consequently a company’s greatest asset.” Make sure you aren’t underutilizing that asset—yourself, that is.