In Harry Beckwith's book "Selling the Invisible" there is a chapter that highlights a strong premise "Don't plan your future plan your people".
Harry's books are always a good read because many of his bottom line messages viciously contest common thought practices.
Why would you plan your people? People always disappoint you! ALWAYS! That's what your father said, just before he disappointed you.
And now a list of faces pop through your head of bright-eyed individuals that have looked so good on that initial meeting but have ended up becoming a deep insidious poison in your bones.
Now you think of stolen money, arguments, legal letters, court cases and swear words.
We have all been disappointed in some way or another.
It rings a bell doesn't it? For some people the ring of the bell is an uneasy minor chord. What if that chord could be transformed into a glorious symphony?
Harry Beckwith's "plan your people" theory is not so easy, but if you can learn from each letdown and somehow keep your heart from turning into hardened lava you'll begin to create a team.
One that will tackle any economic change, inflation flux and industry shift without you really having to worry about it.
The world is unstable and a 120-page business plan planning the future of your business cannot navigate around all of the unseen obstacles . . . but people can.
U2's guitarist Edge said this about their drummer Larry.
"Larry is the one that keeps our ship from smashing against the rocks, while I'm looking through the telescope in the wrong direction and Bono is hanging off the rigging somewhere . . ."
What an incredible comment to be given and one that probably goes against a common teaching that states: "People will always let you down."
You plan your people so that you can have a solid team when things shift in your business.
Your accounts person is not someone
that will charge you for a call and every meeting but is someone that you can build
not only one business with but many businesses.
To find him you may have to be burned by four different accountants but when you do - it's all worth it.
Two perfect C's to use in planning your people is get them on Competence and Character.
That seems to be the general tug-of-war. Once you've got signals of competence and character then unleash this person into their area of ability.
Leave them. You should have a team that you can go to bed and sleep well knowing that your vision is safe in their hands.
Obviously have a standard reporting system and keep tabs on the dollars, but let them be the CEO of their area.
One of the greatest gifts you can ever have is someone who bears the markings of your heart's desires, a person who is an extension of your personality and the projector of the company's image.
This person pre-empts your wishes, not because he is butt kissing but because he understands what needs to be done and understands that he is part of a team.
You don't have to fire him every day because he is already implementing activities beyond your expectations.
His passionate flame does not go out because the roof caved in, he's already found a construction company that will repair it within 24 hours and he assures you that there's nothing to worry about.
Your planned people need targeted and honest affirmation, and they'll be a team-member for life.
Planning people is also about learning to let go of the reins and cutting some slack . . . a team needs to be refreshed by you, and encouraged to perform.
They will hold themselves to a standard and a level of ethics so you don't have to. What a relief!
It might mean you drill the rocks (a few useless people) to get to the gold (solid teammates), but when you finally find the gold it will add the untold value to your company that can't be accounted for with a salary or perks!
Find your team, and enjoy them. If you don't have a solid team - identify the kinds of people you'd like them to be and start looking.
A higher level of business lies in planning your people.
Friday, 9 December 2011
Wednesday, 30 November 2011
Online Publishing...which format to choose
Looking for a business book by Harry Beckwith online. Found that the only electronic version was available on Barnes and Noble-who do not support sales outside of the USA! Amazon's Kindle format, which I can buy from overseas, do not have an e-version. How to kill your international sales.
Wednesday, 23 November 2011
How Many Clicks per Million Really Work for Advertising
Seth Godin has a short piece on web advertising on his blog http://sethgodin.typepad.com/seths_blog/2011/11/moving-beyond-impressions.html
He raises the issue that at which point does the volume of advertising you are putting out become just noise that people filter out. People who live next to the railway line eventually become attuned to the noise of passing trains and it no longer bothers them. At what point do your ads become just another ignored reminder in the mental spam of life? Food for thought.
He raises the issue that at which point does the volume of advertising you are putting out become just noise that people filter out. People who live next to the railway line eventually become attuned to the noise of passing trains and it no longer bothers them. At what point do your ads become just another ignored reminder in the mental spam of life? Food for thought.
Friday, 4 November 2011
Business Culture Creation
When the word culture is mentioned what comes to mind? Is it travel to far off shores and new destinations. Perhaps you think of the refinement and finesse of the arts. Maybe the suits and ties of Wall Street.
Every country has a its own unique culture, the expression of values, likes and dislikes, arts, food, and ethos.
Whatever you think, stepping into another culture almost always triggers culture shock.
Culture shock is potentially a fantastic or excruciating experience of being way out of your comfort zone and engaging in something different to the norm.
Imagine arriving in Paris, the fabled city of love, for the first time. Your hands are shaking as you exit the terminal station with the ineffable feelings of romance.
If you're single you have this strong sense that around the next cobblestoned corner you will find that French damsel or bachelor that will expose you to that European love affair that could turn into something more.
You struggle to comprehend the local language and communicate more in gesture rather than words badly mispronounced from a guidebook.
Even the air appears to taste different. Instead of seeing adverts for Cadbury's and Pascal chocolate bars you see Bonnat.
The culture is different, it is not just one specific thing but a myriad of interrelating aspects that create the whole.
Every company is like this.
You cross the border into another world when you walk into someone else's office.
When you walk into a business you are immediately hit by a culture shock as you experience the way they do business.
This is exaggerated should you be dealing internationally.
Most people tend to mask their shortcomings by giving the excuse "this is how we do it in Africa".
Well, that is fine, but you need to have enough culture in your company that people can relate to if you are willing to do business and gain enough new and exciting experiences to give you a slight edge in your deals.
I am basically going to look at three things that could take your company from Harare to Paris.
Food and drink
As humans we loved to gather around food. Some Zimbabweans definitely get this point.
Amai Garwe's restaurant, and other establishments in the city, are business hotspots because most of the patrons understand this concept.
One of the first things you ask when visiting someone's home is "Is their food good?" Why should it be any different with your business.
It's better to wait for an appointment with a cup of coffee in hand than to stare empty handed at stark walls.
Being offered a biscuit and coffee changes the whole mood.
I was at the ZTA Cocktail at Pandari lodge and it was not the Italian band or the different CEO's that were giving speeches or Miss Zimbabwe Universe that really got the smiles going.
It was the chicken bits, the wine and the cheese, which frankly disappeared within minutes. Internally, this theory counts. In the company that I work for I have taken on what are called "Bullet Coffees".
Instead of having a meeting where it's you, a notepad and an agenda, change the culture and say to the person you are working with "Let's grab a croissant and enjoy our discussion".
That meeting will turn from being the stress point in your day to something you look forward to.
The best part of a boring flight is when you get your food.
Meetings are no different. As we know a good conversation is one thing, but a good conversation over a fantastic dinner is memorable.
Geniality
When the client is the burden, and when I am that client I feel like shooting the CEO with a paintball gun.
A rude receptionist is a cost to the company - every interaction with employees or clients creates the business culture.
Is there a policy in some businesses to make the customer feel like hell when they make a small mistake?
Do people walk through your doors and find laughter, big hellos, and a ready attitude?
Do you have a receptionist who can not be bothered to jump off her feet and shake a person's hand because it's not in their job description?
The Ritz Carlton in Chicago has a policy that hiring is entirely based on attitude, and less on skill.
The culture of geniality is more important then getting the hottest CV on your payroll system. Which leads us to point three.
Atmosphere
In the perfect light everything can be extraordinary. My friend asked me where he should go for his honeymoon with his art-loving lady.
Italy, I said without hesitation, "from Rome to Venice you will not have to lift a finger.
"Let Italy do the work, let the art do the talking and put her in an emotional daze."
What do people feel when they enter your office?
What emotions are stirred by the décor, the state of cleanliness, the clear and helpful signs, the smiles of the staff.
Think of a funeral home, it is only a room with some tasteful décor but how many will host a wedding there? It is all about the atmosphere.
Every country has a its own unique culture, the expression of values, likes and dislikes, arts, food, and ethos.
Whatever you think, stepping into another culture almost always triggers culture shock.
Culture shock is potentially a fantastic or excruciating experience of being way out of your comfort zone and engaging in something different to the norm.
Imagine arriving in Paris, the fabled city of love, for the first time. Your hands are shaking as you exit the terminal station with the ineffable feelings of romance.
If you're single you have this strong sense that around the next cobblestoned corner you will find that French damsel or bachelor that will expose you to that European love affair that could turn into something more.
You struggle to comprehend the local language and communicate more in gesture rather than words badly mispronounced from a guidebook.
Even the air appears to taste different. Instead of seeing adverts for Cadbury's and Pascal chocolate bars you see Bonnat.
The culture is different, it is not just one specific thing but a myriad of interrelating aspects that create the whole.
Every company is like this.
You cross the border into another world when you walk into someone else's office.
When you walk into a business you are immediately hit by a culture shock as you experience the way they do business.
This is exaggerated should you be dealing internationally.
Most people tend to mask their shortcomings by giving the excuse "this is how we do it in Africa".
Well, that is fine, but you need to have enough culture in your company that people can relate to if you are willing to do business and gain enough new and exciting experiences to give you a slight edge in your deals.
I am basically going to look at three things that could take your company from Harare to Paris.
Food and drink
As humans we loved to gather around food. Some Zimbabweans definitely get this point.
Amai Garwe's restaurant, and other establishments in the city, are business hotspots because most of the patrons understand this concept.
One of the first things you ask when visiting someone's home is "Is their food good?" Why should it be any different with your business.
It's better to wait for an appointment with a cup of coffee in hand than to stare empty handed at stark walls.
Being offered a biscuit and coffee changes the whole mood.
I was at the ZTA Cocktail at Pandari lodge and it was not the Italian band or the different CEO's that were giving speeches or Miss Zimbabwe Universe that really got the smiles going.
It was the chicken bits, the wine and the cheese, which frankly disappeared within minutes. Internally, this theory counts. In the company that I work for I have taken on what are called "Bullet Coffees".
Instead of having a meeting where it's you, a notepad and an agenda, change the culture and say to the person you are working with "Let's grab a croissant and enjoy our discussion".
That meeting will turn from being the stress point in your day to something you look forward to.
The best part of a boring flight is when you get your food.
Meetings are no different. As we know a good conversation is one thing, but a good conversation over a fantastic dinner is memorable.
Geniality
When the client is the burden, and when I am that client I feel like shooting the CEO with a paintball gun.
A rude receptionist is a cost to the company - every interaction with employees or clients creates the business culture.
Is there a policy in some businesses to make the customer feel like hell when they make a small mistake?
Do people walk through your doors and find laughter, big hellos, and a ready attitude?
Do you have a receptionist who can not be bothered to jump off her feet and shake a person's hand because it's not in their job description?
The Ritz Carlton in Chicago has a policy that hiring is entirely based on attitude, and less on skill.
The culture of geniality is more important then getting the hottest CV on your payroll system. Which leads us to point three.
Atmosphere
In the perfect light everything can be extraordinary. My friend asked me where he should go for his honeymoon with his art-loving lady.
Italy, I said without hesitation, "from Rome to Venice you will not have to lift a finger.
"Let Italy do the work, let the art do the talking and put her in an emotional daze."
What do people feel when they enter your office?
What emotions are stirred by the décor, the state of cleanliness, the clear and helpful signs, the smiles of the staff.
Think of a funeral home, it is only a room with some tasteful décor but how many will host a wedding there? It is all about the atmosphere.
Friday, 21 October 2011
The Million Dollar Joke
“Humour is the number one way to disarm someone, and get them to let you in to their lovely little world.” I love being in Zimbabwe because every day I get a chance to interact with all of the “serious” businessmen doing “serious” things.
Drinks are on you; jokes are on me.
Sitting with investor worth a few million dollars can be awkward; especially the first time. You are telling him what you think he wants to hear and your sweat beads tell him you are as nervous as a family of worms paddling over a bream pond. The first time I started down the entrepreneur lane I memorized my pitch and nothing else for my first presentation. I desperately stuck to the speech I had rehearsed a hundred times in front of a mirror. In fact, it was so bad that I did not even wait to hear how everyone’s weekend was (after all mine had been spent in front of the mirror). I aggressively pulled out my laptop and started rushing helter-skelter through my slideshow as if I was talking to a bunch of machines that were going to make a decision right after I was finished. I had to learn to relax and have fun with my presentation.
Relax. Get your target to relax and enjoy the show, after all you are not the first person looking for his money and there is little worse for a prospective investor than spending thirty minutes sitting through a presentation that can put the dead to sleep. You could buy him a great glass of wine, take on the bullet of the bill and pay for his truffle covered fillet and his Dom Pedro. Tell a few great stories. Entertain him. Tell a joke. The tears drizzling from his eyes as he is banging the table is the sound of money splashing into your account.
You, my friend, have just entered the realm where “there are numbers in laughter.” Think about a first date with a beautiful girl. On your first date you may not impress a high-class socialite with your clean looks or the extent of your vocabulary, but if you can make her laugh you win. Laughter is where the gold is and laughter is where the next date awaits. You spill your salad onto your lap in a fit of nerves; make a joke out of it. Humour is like a rubber sword, you can make a poke without drawing blood.
A lunch time sales pitch is no different. Create a memory without that thick, heavy, sad smoke of a serious offer lingering around causing your tie and his to feel very tight and uncomfortable. You are trying to sell the best thing since sliced bread; so are a thousand other people. I have said many times that a relationship is more important than quick buck. A strong business partner or serious financial partner is looking for more than just a plan. It’s about class, it’s about humour, and it’s about “can you be someone that I’d like to invest my time in or will all of our meetings just be boring as high school.” Begin to build that relationship in that first meeting.
Two years back I had my first dinner with a billionaire. He was from the US and was sniffing out the prospects of putting down some finance for various projects. He started off very reserved. My brother and I took our seats. He was very reclusive in his posture. My brother and I took the “All or nothing approach” and directed him through the African Based Menu. There were two ways we could leave this dinner-crying or laughing. We could have become quickly overwhelmed by the facade of this heavy weight. It was him in one corner, my brother and I in another. The score was 1 to 1 billion in dollars. We used the only weapon in our arsenal, humour.
We took the view that he was probably very bored with talking business and wanted a little a bit escape – that’s what we ended up giving him. You know that it’s going well when he begins to try and throw back the fruit. He ended up giving my brother “high fives”. High Fives at a business dinner? You better believe you do not leave a billionaire hanging when he puts his hand up for a connection. My hand was sore from the high fives he was giving me in response to perfectly executed jokes. The roar of laughter was almost embarrassing for us (not that we let that show however). At the end of the dinner we did not gain a business partner. We gained a friend. He invited us to his hotel and personal telephone numbers started coming out. Pictures of his single daughter (and no I did not take her for a date) and even if we only saw him again in 5 years he will never forget that night. It was priceless, and better still he paid for our dinner.
Ninety percent of your best memories lie in the area of humour. That is why people go the pub and grab a drink and laugh off all the serious number-crunching meetings they have had during the day. This does not give one the license to be a total clown or to show you as unserious or unreliable. The humour only works when you can deliver it well and your reputation is solid. In humour, timing is everything. If they are not laughing, then it probably was not funny.
Don’t take everything so seriously. Enjoy business, enjoy food, enjoy life and make the billionaires laugh.
Drinks are on you; jokes are on me.
Sitting with investor worth a few million dollars can be awkward; especially the first time. You are telling him what you think he wants to hear and your sweat beads tell him you are as nervous as a family of worms paddling over a bream pond. The first time I started down the entrepreneur lane I memorized my pitch and nothing else for my first presentation. I desperately stuck to the speech I had rehearsed a hundred times in front of a mirror. In fact, it was so bad that I did not even wait to hear how everyone’s weekend was (after all mine had been spent in front of the mirror). I aggressively pulled out my laptop and started rushing helter-skelter through my slideshow as if I was talking to a bunch of machines that were going to make a decision right after I was finished. I had to learn to relax and have fun with my presentation.
Relax. Get your target to relax and enjoy the show, after all you are not the first person looking for his money and there is little worse for a prospective investor than spending thirty minutes sitting through a presentation that can put the dead to sleep. You could buy him a great glass of wine, take on the bullet of the bill and pay for his truffle covered fillet and his Dom Pedro. Tell a few great stories. Entertain him. Tell a joke. The tears drizzling from his eyes as he is banging the table is the sound of money splashing into your account.
You, my friend, have just entered the realm where “there are numbers in laughter.” Think about a first date with a beautiful girl. On your first date you may not impress a high-class socialite with your clean looks or the extent of your vocabulary, but if you can make her laugh you win. Laughter is where the gold is and laughter is where the next date awaits. You spill your salad onto your lap in a fit of nerves; make a joke out of it. Humour is like a rubber sword, you can make a poke without drawing blood.
A lunch time sales pitch is no different. Create a memory without that thick, heavy, sad smoke of a serious offer lingering around causing your tie and his to feel very tight and uncomfortable. You are trying to sell the best thing since sliced bread; so are a thousand other people. I have said many times that a relationship is more important than quick buck. A strong business partner or serious financial partner is looking for more than just a plan. It’s about class, it’s about humour, and it’s about “can you be someone that I’d like to invest my time in or will all of our meetings just be boring as high school.” Begin to build that relationship in that first meeting.
Two years back I had my first dinner with a billionaire. He was from the US and was sniffing out the prospects of putting down some finance for various projects. He started off very reserved. My brother and I took our seats. He was very reclusive in his posture. My brother and I took the “All or nothing approach” and directed him through the African Based Menu. There were two ways we could leave this dinner-crying or laughing. We could have become quickly overwhelmed by the facade of this heavy weight. It was him in one corner, my brother and I in another. The score was 1 to 1 billion in dollars. We used the only weapon in our arsenal, humour.
We took the view that he was probably very bored with talking business and wanted a little a bit escape – that’s what we ended up giving him. You know that it’s going well when he begins to try and throw back the fruit. He ended up giving my brother “high fives”. High Fives at a business dinner? You better believe you do not leave a billionaire hanging when he puts his hand up for a connection. My hand was sore from the high fives he was giving me in response to perfectly executed jokes. The roar of laughter was almost embarrassing for us (not that we let that show however). At the end of the dinner we did not gain a business partner. We gained a friend. He invited us to his hotel and personal telephone numbers started coming out. Pictures of his single daughter (and no I did not take her for a date) and even if we only saw him again in 5 years he will never forget that night. It was priceless, and better still he paid for our dinner.
Ninety percent of your best memories lie in the area of humour. That is why people go the pub and grab a drink and laugh off all the serious number-crunching meetings they have had during the day. This does not give one the license to be a total clown or to show you as unserious or unreliable. The humour only works when you can deliver it well and your reputation is solid. In humour, timing is everything. If they are not laughing, then it probably was not funny.
Don’t take everything so seriously. Enjoy business, enjoy food, enjoy life and make the billionaires laugh.
Thursday, 13 October 2011
Starting to Invest...a few tips
Building up your investment portfolio is something that takes time. If
you’re starting to branch out into other small investments the goal of
this piece is to give you a few pointers on what to look for, and what
to avoid. Many people get excited about “Quick Spins” or “Investing in
other countries” but the grass is not always greener on the other
side.
Invest in relationships not just in concepts. Consider this situation,
you get pitched this great idea in a boardroom in Harare. The person
who is running with the concept is from a city in Ghana and his pitch:
“You can buy a piece of land on the Ghana coast at next to nothing.
The value of the plot will double every year because of a coastal
development fund and when you finally decide to build you’ll be so
happy that you put your money here because the return will be unreal.”
Your eyes perk up, and the sounds of having an exquisite beach plot on
the lovely beaches of Ghana sounds like a dream.
Even though you’ve never been to Ghana before and you are not really
sure if the water is warm or cold, and you’re also not really sure
that the beaches are beautiful. The return sounds good and you could
also rent it and then use if for your own family vacations. This is a
good deal. Well… maybe. Another way to look at it is that you buy the
property on impulse. You end up visiting the plot and you convince
yourself that you’ll start building. You contract the builders while
you are there and go back to Harare. Three weeks later the builders
call – they need more money. You fly back to Ghana only to find that
the builders have made a huge mistake on the foundation of the
property. You cannot fix the problem in the few days that you are in
the city and so you have to schedule another trip in a month. Every
extra profit you make begins to be poured into your plot in Ghana.
Finally, long overdue, it is built and you start renting. Then the
tourists that rented your place trashed it and break several things in
the house and you are not sure if they paid the full amount. You also
have a hunch that the person you left in charge of your property stole
your geyser and replaced it with a substandard copy but that will take
weeks to prove. You are in Harare and your local business needs your
attention and so you cannot just pick up and leave every time there is
a problem. You’ve got an investment in Ghana (for the record: I think
Ghana is great country) that is frustrating the heck out of you and
when you mention to your wife that you would like to take her there
for Christmas she bursts into tears because you forgot about your
annual Cape Town Visit. An opportunity that sounded great ended up an
expensive managerial nightmare. Yes, this may be a cynical approach
but it may not far from the truth.
When you are starting to build your portfolio invest around the
corner, literally. Unless you have money to play with, invest in a
place that you can drive to, it is so much easier to check up on. I
had a friend that did once buy a lovely beach property on the East
African coast. He lived in the U.S. When he first invested in the
property he was overjoyed. “This will get me a constant revenue source
from visitors every single month.” Like in the example, there was more
travelling backwards and forwards to manage the property then actually
enjoying it’s return and benefit.
In another instance there are large asset management companies that
will help manage your money but you will not end up owning anything
and the return will be controlled. Now there is nothing wrong with
that but remember what you are getting into. Do not put everything you
have in something that is extremely controlled. Should you go this
route make sure you are clear about the fee structure, penalties for
early withdrawal and do some homework on the funds you are investing
in (their prime investments, who manages them etc.).
If you’re friends with a stock broker, or there is someone you have
been to dinner with a couple times and he knows how to trade on the
market then give the market a shot, but remember that you are
investing based on a relationship. If you have a friend in the real
estate market that you trust; talk to them. Perhaps they have a fund
you can be a part of. Remember though, get everything in writing. When
it comes to hundreds and thousands of dollars that you are looking to
invest. Portion it out. Do not, I repeat do not invest everything into
one place. The world is replete with stories of people who have lost
everything when a market has turned or a company has failed. Ask
anyone who invested in Enron where in an 18-month period shares fell
from 90USD to 1USD.
In the long term there are high-risk entrepreneurial opportunities.
When you are investing in a small, local, computer business you can
see the possible returns. You can go the office if there’s an issue.
If you have partners you can organize a 20-minute coffee and sort out
the dividends and straighten out problems. Ask a few people that you
trust. What can I do with $2,000 or $3,000? See if there’s anything
that works for you. Weigh your options. Get it in writing and go
forward.
you’re starting to branch out into other small investments the goal of
this piece is to give you a few pointers on what to look for, and what
to avoid. Many people get excited about “Quick Spins” or “Investing in
other countries” but the grass is not always greener on the other
side.
Invest in relationships not just in concepts. Consider this situation,
you get pitched this great idea in a boardroom in Harare. The person
who is running with the concept is from a city in Ghana and his pitch:
“You can buy a piece of land on the Ghana coast at next to nothing.
The value of the plot will double every year because of a coastal
development fund and when you finally decide to build you’ll be so
happy that you put your money here because the return will be unreal.”
Your eyes perk up, and the sounds of having an exquisite beach plot on
the lovely beaches of Ghana sounds like a dream.
Even though you’ve never been to Ghana before and you are not really
sure if the water is warm or cold, and you’re also not really sure
that the beaches are beautiful. The return sounds good and you could
also rent it and then use if for your own family vacations. This is a
good deal. Well… maybe. Another way to look at it is that you buy the
property on impulse. You end up visiting the plot and you convince
yourself that you’ll start building. You contract the builders while
you are there and go back to Harare. Three weeks later the builders
call – they need more money. You fly back to Ghana only to find that
the builders have made a huge mistake on the foundation of the
property. You cannot fix the problem in the few days that you are in
the city and so you have to schedule another trip in a month. Every
extra profit you make begins to be poured into your plot in Ghana.
Finally, long overdue, it is built and you start renting. Then the
tourists that rented your place trashed it and break several things in
the house and you are not sure if they paid the full amount. You also
have a hunch that the person you left in charge of your property stole
your geyser and replaced it with a substandard copy but that will take
weeks to prove. You are in Harare and your local business needs your
attention and so you cannot just pick up and leave every time there is
a problem. You’ve got an investment in Ghana (for the record: I think
Ghana is great country) that is frustrating the heck out of you and
when you mention to your wife that you would like to take her there
for Christmas she bursts into tears because you forgot about your
annual Cape Town Visit. An opportunity that sounded great ended up an
expensive managerial nightmare. Yes, this may be a cynical approach
but it may not far from the truth.
When you are starting to build your portfolio invest around the
corner, literally. Unless you have money to play with, invest in a
place that you can drive to, it is so much easier to check up on. I
had a friend that did once buy a lovely beach property on the East
African coast. He lived in the U.S. When he first invested in the
property he was overjoyed. “This will get me a constant revenue source
from visitors every single month.” Like in the example, there was more
travelling backwards and forwards to manage the property then actually
enjoying it’s return and benefit.
In another instance there are large asset management companies that
will help manage your money but you will not end up owning anything
and the return will be controlled. Now there is nothing wrong with
that but remember what you are getting into. Do not put everything you
have in something that is extremely controlled. Should you go this
route make sure you are clear about the fee structure, penalties for
early withdrawal and do some homework on the funds you are investing
in (their prime investments, who manages them etc.).
If you’re friends with a stock broker, or there is someone you have
been to dinner with a couple times and he knows how to trade on the
market then give the market a shot, but remember that you are
investing based on a relationship. If you have a friend in the real
estate market that you trust; talk to them. Perhaps they have a fund
you can be a part of. Remember though, get everything in writing. When
it comes to hundreds and thousands of dollars that you are looking to
invest. Portion it out. Do not, I repeat do not invest everything into
one place. The world is replete with stories of people who have lost
everything when a market has turned or a company has failed. Ask
anyone who invested in Enron where in an 18-month period shares fell
from 90USD to 1USD.
In the long term there are high-risk entrepreneurial opportunities.
When you are investing in a small, local, computer business you can
see the possible returns. You can go the office if there’s an issue.
If you have partners you can organize a 20-minute coffee and sort out
the dividends and straighten out problems. Ask a few people that you
trust. What can I do with $2,000 or $3,000? See if there’s anything
that works for you. Weigh your options. Get it in writing and go
forward.
Thursday, 6 October 2011
Picking the Right Person to do Business With
"Let us get married so that we can make more money together." Imagine marrying someone only for the financial benefits.
You would focus more on the legal contracts than on the wedding day.
In fact, you would probably get a lawyer to help write your vows and make sure that there was a pre-nuptial agreement before there was a down payment on the wedding venue.
What kind of a marriage would that be?
Similarly, what kind of a business life would you have if every relationship only focused on the money?
People spend thousands of precious dollars on legal fee's to get a start-up business or partnership protection, just in case something goes wrong.
When or if it does, an additional "fortune" has to be spent on more legal work to get you out of the fix.
Pretty soon you would have wasted all your start-up cash protecting yourself, and in the end you still get burnt.
How much better would it be to build a business relationship (still having the partnership clearly outlined) on trust and transparency instead of legalities and suspicion.
If you don't know what I am talking about then you probably have not started a business yet.
If you catch this principle it will save you a lot of money, emotional heartache and a few intense meetings with lawyers.
(During the first year of operation lawyers often charge you per minute so be careful not to have long chats about your upcoming family vacation with them - nothing against lawyers).
Relationships are key to any business venture. The old adage of its not what you know but it's who you know holds true.
People that you partner with need to be chosen carefully.
Start-ups have potential for high friction levels; cash-flow crises, differences of opinion, fatigue and perceived imbalances in workload.
Prevention of the problem is infinity better than trying to cure it.
I had a question from one of our readers this week that ties in here.
"Where do I invest US$2 000 or US$3 000 today in Zimbabwe?"
Good question and my answer is simple.
A business partner of mine who was a former Wall Street investment banker (I'll keep his name anonymous) answered this way: "You never invest in a business idea. You always invest in a relationship."
Let that sink into your pool of beliefs and give it time to ferment.
I will give some more practical advice in another article.
Here are some buffering questions you can ask yourself when considering: "Is this guy going to be a good partner or person to invest with in the long run".
Question number 1: Is their vision the same as yours?
There must be the same desire to bring about change in your clients' lives as a result of your product.
If their goal is simply to make money, then be prepared for a potentially rough ride.
Do not let the "root of all evil" grow in the backyard of your business. Enriching the lives of others through your product and helping build a better world around you will often bring in the cash flow you desire.
Question number 2: Do they have the same values as you do?
If one member of the team is fine with overcharging while another is not you have a problem.
If your values are not the same it will be hard to have a firm foundation on which to solve problems.
Watch for patterns that repeat themselves, and do not be too quick to say, "let us partner".
Question 3: Is this person always late for meetings?
Is he shifting goalposts? An example: I helped start a business that had brilliant potential.
We got the business to a place where it would be investor worthy and operationally viable.
We had 25 percent of the company on the table for a certain amount of money.
An investor came in with the money, only to later shift his interests and he demanded 51 percent of the business. (There are sharks out there that have great smiles).
My partners and I immediately pulled out of the project because of the violation of integrity.
Legal battles could have been fought but time wasted on spilt milk can cause you to miss new opportunities.
There was no point in trying to build the business with someone who is dishonest.
Question Three: Can you trust this person?
If you cannot trust your partners on a handshake, then it will be hard to hold them to a document.
Once the handshake is trusted, then get roles, responsibilities, timelines and deliverables down in writing.
Let me say that again, all you agreements should be in writing.
Do not get me wrong, problems will arise even if you are doing business with angels and the human memory is too fallible to be relied on in an argument.
Put it on paper, it remembers better.
The truth is you may make or will make a wrong decision on a business partner.
It does not mean that things cannot be solved amicably.
The decision on whether to fight it or walk away remains yours.
Business is people. You need people to help you and to buy from you.
You need people to audit your books and to encourage you when you have hit the bottom of the ocean.
Don't short change yourself by making everything "just a contract". It is more like a marriage.
You would focus more on the legal contracts than on the wedding day.
In fact, you would probably get a lawyer to help write your vows and make sure that there was a pre-nuptial agreement before there was a down payment on the wedding venue.
What kind of a marriage would that be?
Similarly, what kind of a business life would you have if every relationship only focused on the money?
People spend thousands of precious dollars on legal fee's to get a start-up business or partnership protection, just in case something goes wrong.
When or if it does, an additional "fortune" has to be spent on more legal work to get you out of the fix.
Pretty soon you would have wasted all your start-up cash protecting yourself, and in the end you still get burnt.
How much better would it be to build a business relationship (still having the partnership clearly outlined) on trust and transparency instead of legalities and suspicion.
If you don't know what I am talking about then you probably have not started a business yet.
If you catch this principle it will save you a lot of money, emotional heartache and a few intense meetings with lawyers.
(During the first year of operation lawyers often charge you per minute so be careful not to have long chats about your upcoming family vacation with them - nothing against lawyers).
Relationships are key to any business venture. The old adage of its not what you know but it's who you know holds true.
People that you partner with need to be chosen carefully.
Start-ups have potential for high friction levels; cash-flow crises, differences of opinion, fatigue and perceived imbalances in workload.
Prevention of the problem is infinity better than trying to cure it.
I had a question from one of our readers this week that ties in here.
"Where do I invest US$2 000 or US$3 000 today in Zimbabwe?"
Good question and my answer is simple.
A business partner of mine who was a former Wall Street investment banker (I'll keep his name anonymous) answered this way: "You never invest in a business idea. You always invest in a relationship."
Let that sink into your pool of beliefs and give it time to ferment.
I will give some more practical advice in another article.
Here are some buffering questions you can ask yourself when considering: "Is this guy going to be a good partner or person to invest with in the long run".
Question number 1: Is their vision the same as yours?
There must be the same desire to bring about change in your clients' lives as a result of your product.
If their goal is simply to make money, then be prepared for a potentially rough ride.
Do not let the "root of all evil" grow in the backyard of your business. Enriching the lives of others through your product and helping build a better world around you will often bring in the cash flow you desire.
Question number 2: Do they have the same values as you do?
If one member of the team is fine with overcharging while another is not you have a problem.
If your values are not the same it will be hard to have a firm foundation on which to solve problems.
Watch for patterns that repeat themselves, and do not be too quick to say, "let us partner".
Question 3: Is this person always late for meetings?
Is he shifting goalposts? An example: I helped start a business that had brilliant potential.
We got the business to a place where it would be investor worthy and operationally viable.
We had 25 percent of the company on the table for a certain amount of money.
An investor came in with the money, only to later shift his interests and he demanded 51 percent of the business. (There are sharks out there that have great smiles).
My partners and I immediately pulled out of the project because of the violation of integrity.
Legal battles could have been fought but time wasted on spilt milk can cause you to miss new opportunities.
There was no point in trying to build the business with someone who is dishonest.
Question Three: Can you trust this person?
If you cannot trust your partners on a handshake, then it will be hard to hold them to a document.
Once the handshake is trusted, then get roles, responsibilities, timelines and deliverables down in writing.
Let me say that again, all you agreements should be in writing.
Do not get me wrong, problems will arise even if you are doing business with angels and the human memory is too fallible to be relied on in an argument.
Put it on paper, it remembers better.
The truth is you may make or will make a wrong decision on a business partner.
It does not mean that things cannot be solved amicably.
The decision on whether to fight it or walk away remains yours.
Business is people. You need people to help you and to buy from you.
You need people to audit your books and to encourage you when you have hit the bottom of the ocean.
Don't short change yourself by making everything "just a contract". It is more like a marriage.
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