Have a Happy New Year,
Your Newtek Team
It’s the end of the year again – which means it’s time to start lying to ourselves about how few carbs we’re going to eat and how many sit-ups we’re going to do in the coming year. These last days of December are also the time when small business owners should be taking stock of how things have gone over the past 12 months, and looking ahead to the future. While pretending to be serious about all kinds of personal resolutions is one of my very favorite traditions, the things we vow to do and do better at in our professional lives are hopefully taken seriously. Below is our list of 5 things we think are likely mistakes for small business owners to make in 2014. Read, avoid, and be ahead of the curve.
Yes, you read that right. After years of every blog and news story telling you how much social media matters to every small business, it has now become necessary to temper our focus on the online world. It’s not that social media is any less essential to a well-rounded marketing and customer service strategy, it’s just that more traditional tactics are also still crucial, and are increasingly being neglected. For most small businesses, it’s enough to make sure your presence on social media is strong, representative, branded, responsive, and regularly churns out content – but that’s good enough. You don’t need to be glued to Twitter all day long. For most businesses, doing so will hurt you by taking your attention away from other vital operations. Social media is all about finding that sweet spot where your investment is balanced with your return; you don’t want to be putting in too little or too much energy. 2014 will hopefully be the year that small businesses take a step back and start figuring out where that perfect balance is.
Speaking of advice that has changed: ignore whatever you read two years ago about how you should never pay for advertising or sponsored content on Facebook, Twitter or elsewhere. You probably should at this point. What’s changed? In short, everything. Both Facebook and Twitter have completely overhauled the methods by which they deliver content to their users, and without getting into too many mind-numbing specifics, the bottom line is that paying to promote your content is actually more worthwhile than it’s ever been. And it’s also easier than ever to have your unpaid content get totally lost in the mix. Prices start pretty low for this kind of marketing, so now is a good time to look into it.
In some ways, it’s fantastic how rarely a small business owner feels a need to leave their computer to do business. Tasks that used to mean travel (whether it’s just to the next room or across the world) now can happen without ever having to get up from your desk. That is undeniably pretty cool. But at this point, maybe it’s time to stop being amazing at the coolness and convenience of modern business technology, and start actually examining which old-school methods are worth holding onto. This tech audit will surely look different for every small business, but we’ve found this is a good bottom line to aim for: do everything you can to preserve face-to-face interactions. Just trust us. Any time it’s possible, suggest a coffee or lunch meeting instead of volleying emails all day. It can end up being a time saver, not to mention the invaluable forging of relationships that result from personal contact – especially during a time when it’s increasingly rare. Simply meeting in person is enough to make you stand out and stick in someone’s mind. Be that person.
Yes, Obamacare. Yes, government shutdown. Yes, fiscal cliff. Listen, the government has undoubtedly been active in the past year in a lot of ways that are impactful for small businesses. We’re not saying these issues don’t matter to you and your business. Of course they do, and it’s smart to stay informed on them. What doesn’t help, however, is using them as an excuse for anything. At the end of the day, you are still responsible for the health and vitality of your business, and a big part of that means successfully navigating changing conditions and environmental challenges. Keeping your head down and figuring out how to adapt is a lot more useful than complaining and excuse-making.
There is (almost literally) an app for everything by now. There are so many brilliant tech tools designed to help your small business function more smoothly (and really, we’re not hating on them – so many of them truly are brilliant.) That said, 2014 should really be about doing your homework, figuring out which apps are available and would most greatly benefit you and your business. Once you’ve identified a small set of tech tools that will make the biggest impact on your time, try to not use any others just because they’re there, or are especially cool. We know it’s hard, but honestly, it’s better to keep things simple.
If your credit card information was compromised, would it make you feel better to know you were among 40 million others? We wouldn’t either. Sadly, that’s the way 40 million of us who shopped at Target in the 3 weeks following Thanksgiving are feeling today.
Late yesterday, the Secret Service confirmed they were investigating this colossal breach.The data breach itself, is said to have occurred around the time of last month’s Black Friday and the Secret Service offered, “(the situation) potentially involve(s) millions of customer credit and debit card records.”
Target said it notified authorities once they were informed of the unwanted and unauthorized access. Apparently the criminals gained duplicate data from the magnetic strips of shoppers’ cards, allowing them to counterfeit and potentially wreak havoc in myriad other ways. With PIN numbers in tow (if they were able to garner those as well), it would allow the thieves to actually withdraw cash from ATMs.
Mad at Target?
We’re not. But we do feel sorry for them and their Customers. However, this matter should not be shrugged off. If you haven’t thought about it before, physical and cybersecurity should be paramount to business operations in 2014.
If you would like some assistance in tightening your business security at your points of sale, Newtek can help process credit credit cards with new EMV terminals that can help to eliminate this risk.
Recently, Amazon has created new drone devices, designed to dramatically improve the delivery time of all online product orders. The Amazon “Prime Air” drones are expected to be able to deliver products weighing up to five pounds, to addresses within a ten mile radius … within approximately thirty minutes of receiving an order. While Amazon is planning to implement these new devices by 2015, skeptics are questioning whether this deadline is realistic. Prime Air drones are a mere thought at this stage as there are major impracticalities that Amazon has yet to address.
It is discomforting, to say the least, that any “Joe Shmoe” with a rifle, could simply shoot down one of these drones in mid air for their trophy case’s next addition (and to claim a free gift.) You see, while Amazon drones cannot carry extremely heavy loads, some of the products being delivered will be extremely valuable (phones, video games etc.) … not to mention other “private” items for which consumers would prefer delivered in a secure and discrete manner.
Security would continue to be an issue in highly populated areas as a drone’s only job to this point would be to drop off a package at a consumer’s location. To date, Amazon has done absolutely nothing to ensure that its customers actually receive their products – making purchased items “fair game” for anyone their good recipient can call “neighbor.” With that being said, the Prime Air drones could possibly function better, dare we say ‘thrive,’ in more rural areas where land is more private and secluded. However, Amazon claims they will only deliver to addresses within a ten mile radius of their distribution sites. Therefore, it is not probable that they would deliver to the aforementioned rural areas, which appear to be much more conducive to the drone delivery system concept.
All in all, the Amazon drones are an excellent idea on paper and could prove to be a real game changer for online shopping. That being said, it is not a completely practical idea at this point. Many have already figured out ways to hack and manipulate these devices in order to illegally obtain valuables. However, the mere fact that Amazon now possesses such futuristic capabilities is impressive and inspires the imagination regarding the future of online shopping. One cannot help to be excited by the purported use of these future-is-now devices.
The idea of a drone delivery system has been around for some time; however the idea seemed more science fiction-like. Amazon has evolved this idea from a “nice thought” into something that is a bit closer to tangible. While obstacles like how birds (extremely territorial creatures) may interact with these devices have yet to be addressed – in a perfect world, prime air drones do work. The challenge will be to make them functional/practical in a world in which is largely unknown in such capacity. While Amazon remains optimistic about forthcoming challenges, 2015 may be a tad auspicious – even for a big-hitter like Amazon. (Though, Elon Musk likely disagrees.)
However, the thought that a drone delivery system could be in place in the near future – definitely has generated much excitement, particularly amongst those who dread the alternative method called “traditional holiday shopping.”
It was the late Steve Jobs who famously said that technology alone was not enough, that the liberal arts, too, were essential for innovation. Or maybe he just felt sorry for all his broke friends walking around with English Lit degrees.
Or maybe I’m just looking for an excuse to talk about my favorite books of the year, here on our tech blog.
At minimum, this may be helpful if you’re looking for gift ideas. You can’t go wrong with a great book, and I promise you that the ten books listed here are absolutely that, at least according to me.
So, in no particular order, here’s my list of the year’s best books:
The Son, by Philipp Meyer (novel)
The term genius is thrown around too often, but Meyer might just be a legitimate one. The research that went into this book is insane, but what Meyer did with it is what’s truly amazing.
Middle Men, by Jim Gavin (short stories)
This review snippet says it best: “Sad and overtly hysterical, the stories dodge self-pity and indie quirk for pensive American tales of turn-of-the-20th century manchildren gesturing vaguely toward a future of eroded opportunity”
Vampires in the Lemon Groves, by Karen Russell (short stories)
Russell is insanely young and even more insanely talented. I pretty much hate her. And don’t let the book title fool you – yeah, there is a story about a vampire in this collection, but this aint no cheesy teen vampire story.
Hotel Juarez: Stories, Rooms and Loops, by Daniel Chacon (short stories)
Daniel Chacon pulls off something magical here with this collection of stories. From a Chicano artist living in Paris to a young boy who invents his own math, each interesting piece adds up to a satisfying read.
I Want to Show You More, By Jamie Quatro (short stories)
As you can tell so far, I have a lot of short story collections on this list. But for good reason. We’re living in a golden age of short story writing. Jamie Quatro has certainly written one of the best collections of the year.
Tenth of December, by George Saunders (short stories)
Doctor Sleep, by Stephan King (Novel)
Shadow of Eden, by Louis Kirby (Novel)
Disclaimer: author Louis Kirby is a Newtek customer.
Make sure you free up your day before starting this one. This book will keep you on the edge of your seat right from the start. Louis Kirby has Dan Brown’s knack for plot momentum but is very much Crichtonesque when it comes to weaving plausible science with an incredible story.
Midnight in Mexico, by Alfredo Corchado (Journalism)
Not your ordinary front-line reportage. Corchado discovers that the Mexican drug cartels may have put a target on his head. But instead of fleeing for his life, he investigates it. One of the best books to date on the violence plaguing Mexico.
The Unknown University, by Roberto Bolano (Poetry)
William Rose is Vice President of Marketing & Communications for Newtek Technology Services. You can reach him at firstname.lastname@example.org
There is a common misconception surrounding startup businesses: selling means you’ve failed. To be fair, I’m pretty sure the only people still holding onto this misguided way of thinking are people who have never worked in the startup world. For anyone with a functional knowledge of how small business development, startups, and modern day business practices in general, mergers and acquisitions are a healthy part of the business life cycle. In fact, a great many entrepreneurs start up new companies for the single, intended purpose of making them attractive to sell to a bigger company at the right time. It’s actually a really exciting game that more and more people are opting to spend their careers playing. For a lot of small business owners, getting an offer to have their company absorbed by a bigger company or group is an immensely celebratory moment. Even if your original plan when starting out wasn’t to eventually sell your company, any number of events and circumstances can bring you to a point where it becomes to most favorable way to move forward. And while leaving behind the startup phase of your business can be bittersweet, making sure you are as well-prepared and advantageously positioned when going into the acquisition can help make the whole experience as positive and lucrative as possible. We have a few tips for how to make that happen.
The best way to be in a position of power going into selling your company is to know ahead of time that that’s where you are headed and prepare accordingly. In general, knowing about a year in advance is adequate time. This means starting to develop relationships with higher ups at companies who you think might be viable buyers, and putting as much effort as possible into making your business strong. Booming businesses on the rise are what companies are looking to acquire, not flailing startups who are about to die out.
When you’re actually ready to start fielding offers, this ratio is a great guide for the pitching process: call a big meeting with 20 companies who you believe would potentially be interesting in buying your business. Out of that, watch the ratio unfold – you’re likely to get around 6 follow-up meetings, from which you’ll probably see 3 more serious meetings, hopefully resulting in at least one firm offer. However the numbers work out, the point is the same: cast a wide net and the truly interested parties will rise to the top.
Once you’re in the middle of negotiations with the most serious potential buyers, throw yourself completely into the process. Make them love you. Take them out to dinner, be their friend; wooing a buyer for your company is a lot like back when you were looking for a principle investor. These decisions often come down to a gut feeling on the part of the buyer – so now is the time to go above and beyond to make their gut feel very favorably about you as a smart, capable, likable person.
The midst of taking meetings and negotiating offers with possible buyers is about more than crunching numbers – this is the time to show them the kind of innovative foresight and proactive business savvy you bring to a team. Quite often, having your business absorbed by a bigger company doesn’t mean that you will be doing a significantly different job, but it does mean that you will now be doing that job in a different context, to serve a different bottom line. Show potential buyers that you understand their company and have an energetic vision for how you and your company can work with and for their company. Their job as a company who acquires smaller companies is to have an eye for identifying who is going to benefit them the most – your job isn’t just to sit back and hope you appear to fit the bill; your job is to speak up and tell them exactly how you do.
Navigating all the meetings, research, and follow-up required in nurturing a successful sale of your company is obviously time consuming. Even still, don’t ever forget that you still have a business to run. Nothing will stop a sale in its tracks faster than a slowdown in your business’ productivity. During the sales process, your company itself becomes a product – if you don’t keep it in pristine working order, no one is going to end up taking it home.
For the last few years, mobile app usage has grown to such a colossal point that lately it seems like every business thinks it’s a necessary part of their development; “App up or perish in obscurity” is the new thinking. The problem: not every small business needs a mobile app, nor does
If you develop an app that your customers never end up using, not only will you have wasted significant money, but every time someone looks at your app, sitting unused on their device, they will begin to subconsciously associate your company is stagnancy and irrelevance – not exactly great branding. This is what we mean when we say that as much as a well-timed, highly engaging app can give your company a marked boost, an app that serves no practical purpose can do more than fail to help your company – it can actually hurt it.
If your company is currently debating whether or not to take your business mobile, take note of the following 4 signs. These are good markers for whether or not mobile app development would be a smart use of your time and resources.
1. You have enough money
Mobile app development is not cheap, nor should it be. By now, there are individuals and companies out there who offer super cheap mobile apps but this is a situation where you truly do get what you pay for. The only thing worse than not having a mobile app when you could genuinely benefit from one is having one that looks or functions cheaply. Don’t cut corners here: if you don’t have enough money to hire a fantastic developer, you don’t have enough money for a mobile app right now.
2. Your app opens growth potential
Like any other investment you make, there needs to be a possibility that the addition of a mobile app to your customer outreach arsenal is going to foster growth for your company. How exactly that looks for your business is a very unique formula, but that’s what makes the research part before development so crucial – you need to identify which parts of your market you aren’t currently fully engaged in, figure out how to reach them, and brainstorm ways to trigger that engagement with a mobile app. Until you’ve figured out that equation, there’s no real reason to dig into the process of going mobile.
3. Your app fills a need in your market
You absolutely must check out what your competition is doing in the mobile market (and really, you should always be aware of your competition, not just when it comes to mobile) before you solidify your plans. Even companies who offer similar services and products can function very differently in terms of what their mobile app does. Ideally, your app will be the only one to fill a certain need in a market.
4. Your app serves your business model
For example, if you run a yoga studio, maybe your app allows students to sign up for classes, pay their dues, and check schedules. The idea is to find a way to have an app support your preexisting business model, not create some brand new service or function that you didn’t have before.
The holidays are magical times when families gather and, in addition to traditions directly associated with the holidays themselves, engage in the annual pastime of updating each other on what’s new in everyone’s lives. Call it an unfair bit of familial prejudice, but in our experience, extended families tend to look upon new life events like babies, marriage, and promotions as inarguably positive, but the response to the news “I’m starting a new business” is met with a bit more doubt, trepidation, and even concern. Obviously, we’re generalizing; some families are immensely supportive of their entrepreneurial members, and enthusiastically encourage boldly branching out into new professional endeavors. But largely, the holiday family crowd tends to include a lot of people who would rather you play it safe. And let’s be honest, starting a new company is a lot of great things, but “safe” isn’t exactly one of them.
So if you find yourself in the concept or seed stages of your fledgling startup just in time to convene with your family over the next few months, there are some things you can do to make sure that the news of your venture is well received – and possibly even get your family members to break out the checkbooks and really show their support.
Most likely, by the time it comes to telling your family about your new business plans, you will already have talked to a lot of people about it. You probably have your elevator pitch so locked down that you could say it with a mouthful of turkey and dressing…in your sleep. So when your 85-year-old grandmother starts asking questions, it can be all too tempting to launch into your usual spiel. Ya know, the one that’s written for people who either work in your industry or are at least familiar with current business conditions, terms, and ideas. Not exactly the right pitch for this audience. We’re not assuming your family is composed of unintelligent people who require a serious dumbing down of the language you use (although, hey, maybe they are, bless their hearts), but unless they personally have the kinds of experiences, knowledge, and careers that would make a professional-level pitch land correctly, it’s a good idea to re-work your wording so be the most plain English version possible.
That said, you still want to bring as much positive energy, optimism, and excitement to the moment when you talk about your business and your plans and prospects for the future. Whether or not you plan to hit up your family members for financial contributions, you still want them to feel good about what you’re working on, and to be behind you as you move forward. If you approach the topic confidently and enthusiastically, you increase your chance that they will too.
It’s like any other pitch to potential investors, money should be the last thing you talk about. You’ll get to it, and when you do, you won’t be sheepish, but first you need to get your audience onboard. Talk to your family about what your business does, why you’re choosing to do what you’re doing and how you’re doing it, tell them why it’s going to be successful, and just when they are at the moment of both understanding your startup and expressing positive feedback about your future on this path, that’s when you tell them, “Here’s how you can help.”
This might seem a little illogical, but trust us, it works. If you approach each person individually, it can backfire for a few reasons: they might feel put on the spot, you’ll spend the whole family gathering having the same conversation over and over (which will not only make for a boring time for you, but will likely not make you the most popular person of the year in your family’s eyes either), and – most importantly – it’s a lot easier to say no when no one is watching. Come on, every family has those dynamics: your dad and his two brothers are super competitive with each other; your weird older cousin is always making impulsive decisions to shock the family; your mom always get swept up in the excitement of the moment – the bottom line is, if you proposal a financial contribution to your startup while everyone is together, you’ve got a reasonably good shot that their desire to one-up each other and appear super supportive is going to work in your favor.
After the group pitch, take a moment to follow up – briefly – with everyone, especially the people who said they would be willing to pitch in some seed funds. Some people will bust out a checkbook right then and there, and others won’t. Don’t make it a big deal. This isn’t a fundraiser – the key to successfully pitching your family at the holidays is to not make it a negative experience. You want to say just enough, and say it in just the right way, to get everyone on your side (whether just in spirit or monetarily), and then resume the business of family togetherness. After all, it’s important not to forget that you don’t love these people because they’re investing in your small business; they’re investing because they love you.
It is often not as easy to describe the human face as one might assume. Even within an intimate relationship one might struggle to accurately pinpoint certain features of another person’s face. UK- based professor Dr. Chris Solomon has created an “electronic sketch artist” system which allows people to respond to faces they see – as compared to having to break a face down into different components. Electronic sketch artist has already helped solve hundreds of crimes in the UK and will likely be implemented by the FBI in 2014 in order to crack down on false convictions across the US.
Music and design enthusiast Pieter-Jan Pieters has created a device called Sound on Intuition. The device is unique, in that it affords users the ability to create music through simple body movements. Sensors may be attached to hands, feet, or even the heart, in order to generate a aural response from the device.
Simple movements such as tapping one’s finger on a table or even stretching are capable of being converted into sound, thereby making the name “Sound on Intuition” ideal for this revolutionary creation. Perhaps most notably, Pieters’ forward-thinking device allows people of any background or skill-base to create music and unleash a potential for artistic expression they may not have otherwise had opportunity to harness.