4 Crazy Tips for Awesome Brainstorms

As an entrepreneur, you most likely began your business based primiarily on your own thoughts and ideas. Even if you asked others for their opinions, most entrepreneurs are pretty committed to their own vision.

As you grow your business, you will most likely make the shift from being the entrepreneur as the sole creative contributor to developing a team of creative thinkers who can help propel your business forward.

Taking in different perspectives through regular brainstorming allows small business owners to:

1. Increase growth rates
2. Increase in-house creativity
3. Recognize new opportunities
4. Capitalize on untapped skills
5. Engage team members 

Brainstorming has great value to the entrepreneurial business, but conducting great brainstorms requires trying different ways of tapping into your team's creativity. Here are some non-traditional ways to improve your brainstorming sessions:

1. Go for a Walk - when you are literally facing the same direction together, focusing your body on something external, you tend to get a better flow. Some of the most creative entrepreneurs regularly take their meetings outdoors while walking. Team members quickly learn to wear comfortable shoes, and a lot of work gets done while circling the office or street block.

2. Get Out of the Office - often when we meet consistently in the same room or location, we get stuck on the same ideas. Many business owners conduct all brainstorming sessions in the same conference room in which they meet clients, discuss employee reviews, and meet with their lawyers. The conference room itself becomes associated with "doing business," but what you actually want is for the people with whom you're brainstorming to think in a totally different way. Rent someone else's conference room, go to a park, or meet in a clients' conference room to stimulate new ideas.

3. Bring in an Outsider - it's impossible to avoid the groupthink that develops within any organization. Bringing in an outsider ensures different ideas. Entrepreneurs, with their strong personalities, are at high risk of engendering groupthink in their organizations. The employees decide they can turn off original thought because the entrepreneur has so many of her own. To tap into your employees' creativity, bring in an outsider who will challenge them (and you!) to think in fresh, new ways.

4. Welcome Discomfort - the really good ideas feel really uncomfortable. They often elicit feelings like "we can't possibly do that!" Those are the ideas that we really need to sit with to see if we are rejecting them simply because they are uncomfortable vs. genuinely impossible. Next time you hold a brainstorm, assign someone to pay attention to every time the group shuts down an unconventional idea. Take special note of the "sacred cows" that team members vociferously assert should absolutely not be changed. There is usually gold (not always the obvious kind) in there.

Virginia Ginsburg is founder and chief consultant at Swell Strategies. She is passionate about supporting small business owners and entrepreneurs in starting and running successful enterprises. An avid reader, in this blog she reviews books and articles and relates specific learning points back to entrepreneurial businesses.

5 Reasons Not To Take VC Money (Even When They Are Tracking You Down)

I had an interesting conversation with a brilliant, hugely entrepreneurial guy who owns a technology company that is so hot right now that, with absolutely zero PR or fundraising activity, he is getting pursued by Venture Capitalists who want to invest.

Major VC firms are calling him; clamoring to invest in and/or acquire his business. They are desperate to get a piece of what he's building.

But he's not interested.

He wants to build something big - huge. And he wants to own all of it. Here is what I learned about his strategy:

1. You should only take on investment if your growth is constrained by funding
2. You should only grow as fast as you are able to learn 
3. You should only grow as fast as you can build the infrastructure to support growth
4. It takes time to build a great company
5. You gain more in the long term by maintaining full ownership

I have so much respect for this thinking. In a time when it seems like every technology start-up out there is trying to figure out how to attract venture capital, this guy just goes out and builds a company that is so solid that he can ignore the VC community. His business is completely self-funded, and it's not because he's some kind of millionaire, he built it strong and slow. And he intends to keep doing that.

Of course, there is nothing wrong with taking on investment capital from venture capitalists or angel investors, but I do think it's worth considering the alternative if you have the means to do so.

Virginia Ginsburg is founder and chief consultant at Swell Strategies. She is passionate about supporting small business owners and entrepreneurs in starting and running successful enterprises. An avid reader, in this blog she reviews books and articles and relates specific learning points back to entrepreneurial businesses.

How to Move Faster in Business: Trust

“The first job of a leader—at work or at home—is to inspire trust. It’s to bring out the best in people by entrusting them with meaningful stewardships, and to create an environment in which high-trust interaction inspires creativity and possibility.” 

- Stephen M.R. Covey, The SPEED of Trust: The One Thing that Changes Everything

Every business today is struggling with how to move faster. We all have to: 

Knowing this, many leaders mistakenly rush their employees, customers and partners, trying to speed up the process. But with people, "fast is slow, and slow is fast." This means that when you want to move quickly, you actually have to slow down and first establish whether you have earned the trust to move fast. 

Here is a super-simple example of the speed of trust: 

A shoe seller needs to make one more sale to feed his family that night. A new customer walks in the door, and he quickly selects a pair of red heels that he knows will look great on her and accomplish his goal of eating that night. But the customer doesn't know the shoe seller, so she takes a long time walking around the store, looking at various different shoes, trying them all on. He brings out pair after pair. Eventually, after an hour of looking, she picks the red heels he originally suggested, pays, and walks out the door.   

This transaction looked like this: 

The next day, he finds himself in the exact same position. This time, though, a regular customer walks in his door. She asks him for his recommendation because she trusts his taste and knowledge. He also already knows her size, so after trying on three options that fit perfectly, she purchased two pairs and left the store ten minutes after she walked in. 

This transaction looked like this: 

The speed of trust applies to every single relationship within your business. So, the next time you want to move faster, take a step back and seek ways to build trust instead. Once the foundation of trust is established, there's no holding you back!

Virginia Ginsburg is founder and chief consultant at Swell Strategies. She is passionate about supporting small business owners and entrepreneurs in starting and running successful enterprises. An avid reader, in this blog she reviews books and articles and relates specific learning points back to entrepreneurial businesses.

Which Numbers to Watch In Your Small Business

We can dissect and pull apart all sorts of numbers for any business, but we have to first identify what question we are trying to answer, otherwise we can easily get lost in the weeds.

The most important metrics (other than the basics of gross revenue/gross expenses/net revenue) are those that move the needle on your profitability. Depending on the particular industry/market, this will vary for each company.

Some important areas to consider:

1. Particularly indicative expenses such as COGS, labor, rent, marketing, technology, etc.
2. Margins, including: Gross Revenue/Net Revenue; Gross Expenses/Gross Revenue; COGS/Gross Revenue
3. Marketing/Sales numbers including: New Leads Generated; Total Leads; Sales Meetings; Sales Conversion Rates; Marketing Expenses; Time to Close a Sale

Deciding which aspects of your Profit & Loss Statement can be tricky!

*EXAMPLES*

Consumer Service Company
The steps to achieving revenue for this company involve:

1) list acquisition
2) direct marketing
3) customer registration
4) sales appointment
5) sales meeting
6) sale
7) billing

While we monitor each aspect, we have found that the single most important indicator of how we are doing is our close rate - Step 6 divided by Step 1. So if we reach out to 10,000 people this month and close at our standard rate of 2%, we know we're going to make the rest of our numbers for the month. When that rate goes lower than 2%, we work our way backwards to determine what is not working and make tweaks to the process. Sometimes we go above 2%, in which case, we learn from that, too!

Design/Manufacturing Company
This company has multiple revenue streams:

1) business-to-business sales (including in-line custom-design; in-line
products; exclusive design contracts)
2) direct-to-consumer sales (including company-owned retail store,
company-owned online store; custom design)

Pulling the numbers apart is time consuming and difficult. At this point, we have identified the most profitable aspects of the business (B:B in-line products and exclusive design contracts) and focus on pulling those numbers apart in detail, asking the basic profitability questions. For the company as a whole, we look closely at labor costs, which are the highest expense and also represent the greatest potential weakness for the company.

Virginia Ginsburg is founder and chief consultant at Swell Strategies. She is passionate about supporting small business owners and entrepreneurs in starting and running successful enterprises. An avid reader, in this blog she reviews books and articles and relates specific learning points back to entrepreneurial businesses.