Business.com |
- Not Having Enough Money Isn't a Dealbreaker for Entrepreneurs
- 8 Ways to Generate Leads During COVID-19
- How to Get Your Business Loan Application Approved
- How to Rebrand Your E-Commerce Business
| Not Having Enough Money Isn't a Dealbreaker for Entrepreneurs Posted: 24 Mar 2020 05:00 PM PDT  Whenever I get questions from eager young entrepreneurs about how they should get their start in business, I always recommend being born into a rich family. This answer is very tongue-in-cheek, of course, but my point is that money isn't everything. If you're like me and aren't the product of a wealthy upbringing, there is still hope. If my career has shown me one thing, it's that extremely hard work (or determination) combined with a very high-risk tolerance (or grit) will get you anywhere you want to go in life. You just need to know where to channel your efforts and when to take risks. Despite what society may tell you, or what you want to believe, money isn't everything. It can easily be spent, stolen, invested, and lost – here one day and gone the next. However, one asset that is impervious to all of these liabilities is your drive. And you don't need much more than that. As mentioned, I didn't come from wealth, so I had to forge a path of my own and navigate through waters that were unfamiliar to me. Would money have made my entrepreneurial beginnings less stressful? Absolutely. Entrepreneurship comes with considerable sticker shock if you're not sitting atop a mountain of money. While money might have helped to greatly reduce risk and abate my fear of never "making it," starting Ashcroft Capital, a national multifamily investment firm, has been tremendously rewarding. I'm very grateful things worked out the way they did and I wouldn't change a thing. I credit a lot of this to my father. He started his own pizza shop in the small Pennsylvanian town I grew up in with barely two nickels to rub together. He eventually grew that shop into a local hot spot. He didn't know how long his shop would stay open for, but he didn't care. He had a vision, not a financial security net. He poured his time and energy into his business, letting his pizza, not his bank account, speak for itself. As I watched my father achieve small-town success, I knew that there was nothing better than running your own business. Entrepreneurship was in my blood. Some people get lucky by having a financial leg-up over their competition, but I don't actually know if I'd even consider that luck. You can throw money at a business, but that has no influence on its success. Remember Elizabeth Holmes? Maybe not by name, but does the company Theranos jog your memory? Holmes, who came from generational wealth, created her blood-testing company to revolutionize the healthcare industry. In what people are calling a "spectacular downfall" of a once-celebrated Silicon Valley unicorn, it eventually came out that the results of the blood tests were inaccurate, the company lost billions, and, as of last year, Holmes has a net worth of $0. Holmes isn't the only one who hoped she could hide behind her money; there are so many other stories like this. Don't heed the advice of people who tell you that you need to have a lot of money in order to make a lot of money. Unless you're born into it, there is never a "right time" to start a business. They say the same thing about having children. You'll never feel wholeheartedly ready because fear always triggers doubt. Will I be a good dad? What if I fail and lose all my money? These are fears that a lot of people share, and it's not a bad thing to have these thoughts – it just means you're being cautious. If you want to make something happen, you'll find a way to pursue it. Here are some tips: Success springs from skills, not moneyMy father didn't buy patrons with his money, they flocked to his shop because he made the best pizza in town. When you create something that people want, the money will follow. But you must first develop the necessary skills and business savvy that will build the foundation on which you establish your entrepreneurial trajectory. This means starting small. Before founding my firm that now has roughly $1B of assets under management, I started out as an intern. My goal wasn't to jump into a risky endeavor right out of college in hopes it would be a sustainable salary for me; I wanted to build the groundwork for my development that I knew would create sustainability in the long-term. That coupled with a burning desire to work hard and a healthy sense of competition will get you to where you want to be – not the amount of money that's currently in your bank account. Your ego can be your biggest barrierOne key thing I credit as a strategy for growing my business has been putting my ego aside. This should be the case both before you start a business and while you're running your business. The best interests of your company should always come first. That means being okay with uncertainty, with the struggles you will inevitably overcome along the way, and with the occasional failures that will happen. These aren't what matter. What matters is what's best for your company, not your pride. The instances that typically go against your ego are the ones you actually learn from. The best interests of your company should always come first. Accept that you will have to lose even the smallest of battles in order to win the war. That is what will make you a better entrepreneur. Be willing to put everything you have at riskWhen you don't have a huge financial safety net to fall back on, any endeavor you start will be a risk. But that risk, when it pays off, is worth the reward. When I first started Ashcroft Capital, I couldn't take no for an answer. I had to think creatively because when you think about buying a $15 million property with less than $100,000 in your bank account (and no friends or relatives to lift you towards success), you have no other choice. Starting your own company is one of the riskiest things you can do. It takes a special individual to be able to create an entire organization around an idea or passion of theirs, but what's even more remarkable are the people who cultivate success from almost nothing. Take John Paul DeJoria, for example. You might not recognize the name, but he is the co-founder of the hair care company, John Paul Mitchell Systems. John started out as a newspaper courier and then a janitor; today, he's worth over $3 billion. It's easy to forget that a lot of entrepreneurs come from nothing. We only hear about them after they've made it big. But it happens more than many people realize. Entrepreneurs don't understand the meaning of the word "impossible" because they are willing to put everything on the line in order to bring their vision to life. I never gave up, despite years of failing. I put everything I had – more than everything I had – at risk. The pieces came together and starting my own company has been the most satisfying and thrilling moment of my career so far. And it didn't take millions of dollars to get started. It just took a willingness to try. |
| 8 Ways to Generate Leads During COVID-19 Posted: 24 Mar 2020 04:11 PM PDT  Many businesses have taken a hit because of the COVID-19 pandemic – and not just retail businesses. With a volatile stock market and thousands of people being furloughed, it seems as if the economy has pressed the pause button. While it may be difficult to drive revenue right now, you can still generate leads in the midst of the COVID-19 crisis that will pay off as things return to normal. The basics of selling onlineLet's back up a step and talk about selling online. Unless you're selling a $10 T-shirt, or something considered an impulse buy, it can be difficult to see immediate sales from an ad campaign. While the old adage is that it takes three exposures to a company before someone makes a purchase, the real number is much higher these days. On average, a prospect has to interact with your company by phone, email or social media 20 times before they make a purchase. Few of us have the time (or thick enough skin!) to follow up with a prospect 20 times. That's where sales funnels come in. What is a sales funnel?"Sales funnel" is a fancy term for the sales process, from the time someone learns about your business to when they make a purchase. When marketers refer to a sales funnel, they are generally talking about it as an automated process triggered by an action on your website (e.g., downloading an e-book or registering for a webinar). Automating the process makes it efficient, because you will only have to take action when someone has made a purchase, or your funnel has left you with a handful of hot leads. What is a lead magnet?Lead magnets are incentives that offer up a specific reward in exchange for a user's email address. Here are eight ideas for lead magnets you can use on your own site. 1. E-book downloadWhile e-book downloads are a tried-and-true method, creating a good e-book is a time-intensive process. Though it doesn't need to be long, it does need to bring value. E-books that are essentially sales brochures are a no-no, as are fluff pieces that don't offer any real insights. Remember you are in the early stages of the customer relationship. If someone gives you their email address and receives a resource with little to no value, they will drop out of the sales funnel and you've lost an opportunity. If you don't have the time to create a strong piece that will clearly identify you as a subject matter expert, choose a different lead magnet. 2. WebinarPeople have been using webinars to generate leads for years. They can be a great way to kick off the sales process, as they give you an opportunity to showcase your expertise (and your personality). Much like an e-book, your webinar must provide value. It's OK to offer a special deal to attendees or touch on your solution to a pain point, but don't make the entire webinar a sales pitch. Think of it as the initial serve, rather than a one-shot deal. Note: Live webinars that promise interaction are where you'll collect the most leads, but you could also record the webinar and make it available on demand to pick up a few stragglers after the fact. 3. Cheat sheetsCheat sheets follow a similar formula to e-books while being a much simpler resource. This is a format where you skip education on the concepts and all the reasons why the reader should do something. Instead, you focus on the how. These are some potential formats for cheat sheets:
4. Gated videoHubSpot tells us that customers are four times more likely to watch a video than read about a product, and 52% of marketers around the world name video as the content with the best ROI. That means users (especially the younger set) are more likely to be interested in a video than an e-book. Many content marketers offer the first minute or two for free to get people hooked, and then ask for an email address to keep watching. 5. DiscountWho doesn't like a discount? Everyone wants a deal, so offering a discount can be a great way to push someone over the edge into purchasing. 6. QuizHow many times have you clicked on a quiz to figure out which Harry Potter character you'd be, or how well you know the '80s? While they sometimes feel like clickbait, if you can tie them to your brand, quizzes can be a fun way to engage your audience and collect leads. One strategy I've used with clients is quizzes like this: Can [service name] save you money? Possible outcomes were yes, maybe, and no, which helped the company qualify leads while being honest with customers about what to expect. Win-win. 7. Trial periodMany people don't want to make a purchase until they are sure a service is right for them. A free trial takes the risk out of the purchase for them. This is also a great chance to get a user hooked on your premium features and make your service one they can't live without. 8. Challenge / free mini-courseThis one might be the most labor-intensive option on the list, but if done well, it also yields some of the best results. The idea is to offer a mini-course via daily email lessons. While it sounds daunting, the emails don't have to be long, and they can leverage existing resources. I've put together one of these for a client in which we used existing webinar recordings and blog posts to cobble together a course. I have one on my own website called 14 Days to a Better Google Rank, which sends out a daily email averaging just two paragraphs with short, actionable tips. The reason this works so well is because you are building trust over a period of time. You should be giving away enough information that people find value and start to see results, thus seeing the value of continuing to work with you after the challenge period ends. [Read related article: 6 Ways to Amp Up Your Marketing and PR in the Age of COVID-19] How does all this apply to COVID-19?If we know nothing else, we know this:
People with crazy schedules, who don't usually have time to attend a webinar, finally have an open schedule and are looking to occupy themselves by brushing up on their skills or tackling that thing they've been meaning to cross off their to-do list. This makes it a great time to get in front of people and begin building relationships with them. Remember, these tools are called lead magnets because they bring in leads. Leads do not automatically equal sales, so it's important to create a full campaign that includes following up with the prospect to nurture the relationship and ultimately turn them into a customer. Automated email is a great solution for this. |
| How to Get Your Business Loan Application Approved Posted: 24 Mar 2020 09:10 AM PDT 
Applying for a small business loan can be a challenging process. Not only is it important to organize your documentation, but you must also give the lender significant transparency into your business. After that, waiting to find out whether you've been approved or denied for the loan can be nerve-wracking. But exactly how hard is it to get a small business loan? The answer might depend as much on the lender as it does on your own financial circumstances. How does a small business loan work?The term "small business loans" can refer to a variety of products, but it most commonly describes a term loan from a financial institution such as a bank or credit union. This type of small business loan is one of the most affordable funding options available to entrepreneurs, but it requires substantial documentation and good personal and/or business finances. The upside is that they tend to be low-interest loans from trusted lending institutions. Small business loans often range in term from one to five years, though they can extend longer in certain cases. They could be microloans of a few thousand dollars or much more substantial loans surpassing $1 million. Generally, small business loan interest rates range from 2% to 8%, depending on the lender's requirements and the borrower's creditworthiness. Here's an example of the structure of a typical small business loan:
This is a highly simplified example of a small business loan, but the general structure applies to all term loans. When you sign a loan agreement, look out for additional terms and restrictions, such as loan covenants that could trigger a default if violated. However, the bare bones of a business loan will appear similar to the above. Another common small business loan is the U.S. Small Business Administration's 7(a) loan program. While many small business loans require a personal guarantee from the borrower, with this program, the SBA guarantees the loan. This expands the opportunity to secure funding to borrowers who would otherwise be denied for a loan. However, it takes longer to secure funding through the SBA 7(a) loan program. Generally, SBA loans range in value from $500 to $5.5 million.
Editor's note: Looking for a small business loan? Fill out the questionnaire below to have our vendor partners contact you about your needs. How do you qualify for a small business loan?Qualifying for a small business loan is the first step to secure funding to start or grow your business. Lenders are primarily interested in one major thing: your ability to repay the loan with interest on time. Demonstrating your ability to do so is the most important aspect of qualifying for a small business loan. "Be ready to show a history of steady, strong cash flow or a business plan with a strong likelihood of sufficient cash flow to repay the debt," said Rob Stephens, founder of CFO Perspective. In addition, Stephens said a healthy credit score – both personal credit and business credit – improves your odds of qualifying for a small business loan. Lenders will likely pull a credit report when you apply for a loan, which could help or harm your chances of approval. "Maintain a good personal credit score," Stephens said. "Banks will require a personal guarantee on the debt, so good personal finances improve the odds of getting a loan. You may also need to pledge collateral or find other guarantors for the loan." Lenders often also look at debt-to-income ratio, a measurement of how much money you are bringing in versus how much money you already owe. Your debt-to-income ratio demonstrates how leveraged your business already is, so a lower ratio suggests your business has a better ability to repay additional financing. Of course, a lender isn't going to simply take your word for it and hand you the money. They'll need supporting documentation that shows you are truly in a position to repay the loan you are requesting. So, what should you bring along with you? What documentation do you need for a business loan application?Every loan application will require documentation to back up your assertions. It's important to bring whatever corroborating documentation you can to demonstrate your business's financials and history to the lender. "To apply for a conventional small business loan, you'll first need to share all of your financial details, including your personal financial information, your future growth plans and precisely how you'll use the requested capital," said Farhan Ahmad, founder and CEO of Bento for Business. Ahmad said it's important to come prepared when filling out an application. He recommends bringing the following documentation with you:
"Some applications will require even more information," Ahmad said. "Generally speaking, low-cost, long-term loans have more paperwork than high-cost, short-term ones." How long does it take for a small business loan to get approved?Once you've filled out your application and submitted your documentation, the lender will consider you for approval. Depending on the lender, you might have to do a bit of waiting. The lender will examine your financial statements – including your annual revenue, tax returns and existing loan amounts – to determine whether your business can financially support new debt. They will also consider your credit history and ensure you meet their minimum credit score, a threshold which varies by lender. All of this can take some time. "If you're applying through a bank, you'll then need to pay the application fee and wait for a period of two to four weeks to see if you've been approved," Ahmad said. "This might seem like a long time, but loans through the Small Business Administration can take even longer to get approved – sometimes 90 days or longer." For businesses that don't have much of a history, securing a small business term loan can be difficult. Lenders often base their decisions largely on track record, so, without much of a financial past to examine, newer small businesses are in a difficult spot. However, strong personal finances, personal guarantees and the right collateral could increase your chances of securing a loan. Of course, that puts additional pressure on your business to successfully repay the loan plus interest. How to make sure a small business loan is right for youIn some cases, small business owners are so eager for funding they accept a loan that isn't suitable for their needs. Before applying for a loan, you should understand why you need it and how much funding you require. Loans are important tools in the entrepreneur's arsenal, but if they aren't managed wisely and strategically, they could become an undue financial burden. Take the steps to ensure a small business loan is right for you before accepting the money, making it a mutually beneficial situation for you and the lender. "Before you apply for a small business loan, ask yourself why you need the loan," Ahmad said. "Is it for day-to-day expenses like inventory and employee salaries? Are you a first-time entrepreneur in your first year of business, in need of a startup business loan? Are you hoping to expand your business, perhaps by adding another location? Or do you just need a safety cushion? "From there, you can figure out what type of loan will best meet your needs," he added. "For example, for day-to-day expenses, you might need a smaller loan with a longer repayment period, but for expansion, you might require a larger loan with a shorter repayment period." Of course, the other consideration that should be top of mind is how you will pay back any loan you accept. Small businesses that don't have a repayment strategy based on their true financial metrics could run into debt trouble. "To make sure you're able to pay back a loan on time, I recommend setting up an airtight budget for business expenses," Ahmad said. "If you keep close track of how much money you'll need each month for all of your expenses – from inventory to paychecks to electrical bills – you'll be better prepared to set aside the requisite repayment amount each month, and therefore more likely to pay it back on time." In the event you are forced to make a late payment, he added, it is beneficial to know the details of your lender's late payment policy. Alternative lending options offer more flexibility than banks, but at a costIf you need funding more quickly than the weeks or months a conventional loan takes, there are other options. However, most of the alternative lenders that provide fast approval and funding charge higher rates. Small business owners considering working with an alternative lender should balance the importance of speed versus cost. Alternative lenders come in many varieties; many offer multiple products, such as bridge loans, invoice factoring and cash advances. It's important to understand the ins and outs of each financing type before you decide which method of funding might be right for your business. Review our guide to alternative lending to find out more about the types of alternative loans available to your business. Alternative lenders, sometimes called online lenders, generally offer a simple application process for flexible loans. They also generally have a faster turnaround than banks and credit unions, and more latitude when it comes to application approval. The drawbacks are that alternative loans are generally more expensive. They also tend to be short-term loans, meaning you'll likely have to pay higher installments than you would with a conventional bank loan. Securing a small business loan is a matter of demonstrating reliabilityIf you need a small business loan and have a good personal or business credit score, thorough financial documentation, a history of strong cash flow, and a manageable debt-to-income ratio, you should have little trouble getting approved. For businesses lacking in any of these areas, it might be more challenging to secure a small business loan, but with the right documentation and guarantees, it is still possible. If you find yourself in a position where it's not likely you will secure a conventional small business loan, you could consider an alternative lender. However, remember that alternative lenders typically charge much higher rates, so ask yourself if it's really necessary before you take out a loan. Securing any loan is a matter of demonstrating reliability to the lender. If you can show you have the ability to pay back your loan with interest in the allotted timeframe, your application will likely be approved on the first pass. |
| How to Rebrand Your E-Commerce Business Posted: 24 Mar 2020 05:32 AM PDT 
There's far more to a company rebrand than just a website redesign and a few social media posts. Whether you're a small business rebranding your e-commerce store for the first time or a large corporation trying to redefine your target audience, it can be difficult to rebrand on your own. You need a strong, loyal team to help you effectively launch your new strategy and meet your long-term goals.  Source: Spirit Hub An important part of successfully rebranding your e-commerce business is educating potential customers and business partners about your product or service. Spirit Hub, formerly BigFish Spirits, is one example of an e-commerce business that's done this well. Built by a strong-minded leader and supported by a team of like-minded individuals, its rebrand focused on not only brand awareness, but product education as well. Spirit Hub aims to deliver the vision of the businessSince its inception five years ago, Spirit Hub has worked toward one major goal: unlocking the potential of its distillery partners and leveling the playing field for independent distilleries trying to grow outside their home states. Founder and CEO Michael Weiss knew that the alcohol e-commerce industry was a field he could thrive in and change for the better in the years to come. "I became aware of the three-tier distribution system's limitations for independent distilleries and the craft spirits industry," Weiss told business.com. "I believed [that] with my energy, drive and resources I had the ability to drive change, and therefore founded BigFish, which is now known as Spirit Hub." The three-tier system of alcohol distribution consists of importers or producers, distributors, and retailers. The system allows manufacturers to provide alcoholic products to wholesalers, who distribute the products to retailers, who then sell to consumers. Spirit Hub operates as a retailer in this system, connecting the distilleries that make craft spirits directly with online consumers. "As a company, we have always strived to give fans of craft spirits access to independent distilleries that they could not access before," said Weiss. "This includes product education, brand awareness, great online experiences, bringing new distilleries to market regularly, and connecting distilleries directly with customers." Rebranding by furthering industry education Source: Spirit Hub Spirit Hub identified a large barrier to acquiring customers in the evolving digital world: Its customers didn't know what the company was or what it offered. This required a big change for the company – a total rebrand. The first thing Spirit Hub needed to do was ensure it could deliver a value proposition to its distillery partners, ultimately providing customers with craft spirits from independent distilleries. "In doing so, we identified that we as a company needed to be able to educate our customers on what exactly it is that we do," Weiss said. "Therefore, we as a team decided that rebranding was the next appropriate step." When Spirit Hub was named BigFish Spirits, its brand spoke to its distillery partners but not its customers. So, Weiss had to make sure that when the company rebranded as an e-commerce business, it could quickly convey to customers what it is and what it does. With such a big task at hand, the rebrand faced many challenges, each concerning how fast Spirit Hub could deliver on its mission. "A major turning point was when the brand guidelines were finalized and the creative team could finally grasp the effect this brand would have on customers, as we began our expansion into multiple markets," Weiss said. "When it comes time to flipping social media accounts to the new brand, it's totally out of your control. You need a little luck and a lot of faith." With big challenges come big surprises, but not all surprises are bad. "There are always surprises, but the most pleasing one was how the team came together at the crunch point in the effort, and that was truly humbling," Weiss said. Seeing his team's faces when the website refreshed for the first time was the most rewarding for him. Rebranding earlyFor a business owner or entrepreneur considering a company rebrand, there are several lessons to be learned. For someone who's invested millions in a company and expanded the careers of many, it can be difficult to say goodbye to what once was. Is it truly possible to take a brand you've worked on for years and simply dive into something new? Weiss believes so, and he learned a valuable lesson during Spirit Hub's rebranding process. "The lesson I learned in this process was to bite the bullet and do it sooner than later," he said. "This mountain only gets bigger with time. The sooner you rip off that Band-Aid, the simpler it gets." Weiss says that the saying "fail fast and fail hard" comes to mind. It's best to test new processes quickly to find out what doesn't help. "Waiting won't help, so keep pushing," Weiss said. "That's from John Osborne, my business partner. Follow the rules, figure it out, but always have agility and move things forward." While the mountain to climb may look steep, having a close-knit group of people in your corner can make the rebranding trek easier. Weiss believes you must have a team that is committed to the company effort and able to roll with the punches. It's a team effort – everyone is involved in the process. The importance of family in the process Source: Spirit Hub Weiss encourages e-commerce business owners to make sure family is part of the process too. He believes a business is operated by the people in it along with their families at home. "People need to know what you're doing," he said. "It doesn't just affect your office; it affects their loved ones. You need to be transparent with them. At my holiday party, I thank my employees first, and then their families and loved ones." Weiss said his employees and their families make the difference at Spirit Hub. Teamwork can extend outside the workplace, and massive company changes can touch the lives of people you may have never imagined would feel the effects. Weiss was raised around close family and supported by key mentors who deeply influenced who he is, what he believes in, and why he's so committed to bringing Spirit Hub's vision into reality. Growing up in Lincolnwood, Illinois, a suburb north of Chicago, Weiss considered his hometown a tight-knit community where everyone thought of each other as family. "The individuals who lived there were primarily hardworking people and business owners; they played a large role in my life," Weiss said. "I studied business administration at Touro College in New York City while I cut my teeth in the fintech space. This was a good experience and platform for me as I stepped into my business career." Weiss had three key mentors by his side throughout his business endeavors: his father, his grandmother and business owner Ruben Azrak. His father provided him with support, friendship, counsel and business direction at all times, while his grandmother played a critical role in helping him assess risk tolerance as an entrepreneur. Ruben "Ruby" Azrak, former owner and president of Phat Farm, taught Weiss that a goal is always achievable with great people around him. If his goal was to get people to perform well, he'd have to invest in them. While he believed he was born to build Spirit Hub, Weiss understood that he needed to deliver a solid marketing strategy while educating consumers and industry peers about the alcohol e-commerce industry. Rebranding an e-commerce business is no simple task, and he knew he couldn't do it alone. Teamwork makes the dream workBuilding an efficient team is an important step for nearly every business, and Weiss knew it was critical if he wanted to see his vision of expanding his business into new markets come to fruition. Employing like-minded team members who want to see the company's success just as much as the founder does is an essential part of rebranding an e-commerce business. Weiss also recommends learning about the people on your team and the issues they face. "I really leaned on my team and mentors along the journey," he said. "One key skill I would highlight is listening. Your team is an endless resource to you when solving problems, and providing the forum to ideate on issues and challenges cannot be underestimated." Spirit Hub's next steps Source: Spirit Hub Alcohol e-commerce will continue to grow, and with online grocery shopping currently thriving, the two industries are a match made in heaven. This is where Spirit Hub steps in, pushing the alcohol e-commerce industry forward and providing newfound excitement for what's to come. Spirit Hub plans on expanding into three to five additional markets beyond Illinois state lines. "Up next is customer acquisition and education – that's critical," Weiss said. "For Spirit Hub, it's expanding into multiple states so we can extend the proposition for our distillery partners and reach customers around the world." |
| You are subscribed to email updates from Business.com. To stop receiving these emails, you may unsubscribe now. | Email delivery powered by Google |
| Google, 1600 Amphitheatre Parkway, Mountain View, CA 94043, United States | |
No comments:
Post a Comment