10 Things Entrepreneurs Need to Know
By Rieva Lesonsky
1—Should You Buy an Online Business?
Guest post by Mark Daoust, founder, Quiet Bridge Brokerage
Buying an online business is a dream for a lot of students and professionals who have an entrepreneurial streak. Rather than take the risk of a traditional startup, these entrepreneurs look to acquire something that is already built and profitable.
In our experience at Quiet Light Brokerage, acquisition-minded entrepreneurs come from a variety of places, but more and more, universities are teaching students how to successfully buy an online business rather than start an online business.
Which schools are doing this best? Which cities seem to produce the most notable entrepreneurs?
In the infographic below, we examine entrepreneurial activity through acquisitions of online businesses, including:
- Which cities are entrepreneurial tech hubs
- Notable universities offering entrepreneurship through acquisition courses
- Which universities are producing the top internet entrepreneurs?
- Who is involved in entrepreneurial acquisitions?
2—Reality of Mompreneurs
According to the 99designs Mother’s Day Mompreneur Survey, entrepreneurial moms typically start their businesses after their child hits school age, overwhelmingly serve as the household’s primary caregiver, regularly put in a “second shift” after kids go to bed, and are more likely to sacrifice working out and socializing with friends over missed family time. They are also significantly less likely to raise outside funding for their ventures than male parent entrepreneurs, but often have the support of a network of other business owners.
Mom entrepreneurs are contending with a funding gap. Only 19% secured any outside funding for their businesses, compared to male parent respondents at 27%.
You can see the details in the infographic below.
3—Should You Offer White Label Services?
White label offerings present a lot of entrepreneurial opportunity. Regular contributor Matt Zajechowski of Digital Third Coast says, “It’s incredible—almost every single thing you can do in the marketing and tech space, you can have someone else do, and still get the credit yourself.”
4—How to Solve the Most Common Data Problems in Retail
Guest post by Pauline Brown, VP of Marketing for Dataiku, the maker of the all-in-one data science software platform Dataiku Data Science Studio (DSS), a unique advanced analytics software solution that enables companies to build and deliver their own data products more efficiently.
In the retail business, big data is poised in the coming years to open up huge opportunities in the way stores (both physical and online) fundamentally operate and serve customers. Given the incredibly small margins, Big Data will also provide much needed efficiency improvements—from tighter supply chain management to more targeted marketing campaigns—that can make a big difference to a retail business of any size.
Making data-driven decisions is no longer about learning from the past; it means making changes to the business constantly based on real-time input from all data sources across the organization. Making predictions and applying machine learning is based on traditional data but also on new and innovative sources like connected Internet of Things (IoT) devices and sensors or, going a step further with deep learning, unstructured data from things like static images or cameras monitoring stock in warehouses. Consumers can be fickle, so being able to accurately anticipate what they will do next and quickly react is what puts the most innovative and successful retailers above the rest.
At data science software maker, Dataiku, we recently explored the types of data problems facing retail, the problems they solve, and the steps that any retail organization can take to become more data driven.
PROBLEM #1: Siloed, Static Customer Views
Many retailers still struggle with siloed data—transaction data lives apart from web logs which in turn is separate from CRM data, etc.
SOLUTION: Complete, Real-Time Customer Looks
Cutting-edge retailers look at customers as a whole—combining traditional data sources with the non-traditional, such as social media or other external data sources that can provide valuable insight.
- More accurate and targeted churn prediction.
- Robust fraud detection systems.
- More effective marketing campaigns due to more advanced customer segmentation.
- Better customer service.
PROBLEM #2: Time Consuming Vendor & Supply Chain Management
Supply chains are already driven by numbers and analytics, but retailers have been slow to embrace the power of real-time analytics and harnessing huge, unstructured data sets.
SOLUTION: Automation and Prediction for Faster, More Accurate Management
Combine structured and unstructured data in real time for things like more accurate forecasts or automatic reordering.
- More efficient inventory management based on real-time data and behavior.
- Optimized pricing strategies.
PROBLEM #3: Analysis Based on Historical Data
Looking back at shoppers’ past activity often isn’t a good indication of what they will do next.
SOLUTION: Prediction and Machine Learning in Real Time
Instead, real-time prediction based on current trends and behaviors from all sources of data is the key.
- Anticipating what a customer will do next.
- A more agile business based on up-to-the minute signals.
- The ability to adapt automatically withcustomer behavior.
PROBLEM #4: One-Time Data Projects
Completing one-off data projects that aren’t reproducible is frustrating and inefficient.
THE SOLUTION: Automated, Scalable and Reproducible Data Initiatives
The best data teams in retail focus on putting a data project into production that is completely automated and scalable.
- More efficient team that can scale as the company grows.
- With reproducible workflows, team can work on more projects.
While each organization is different, data challenges are the same. It takes a data production plan to guide any sized team to successfully produce a working predictive model that yields meaningful insights for the business.
How to Complete any Data Project in Retail
The most successful retail companies worldwide solve these four issues by efficiently leverage all the data at their fingertips by following set processes to see data projects through from start to finish. They also ensure those data projects are reproducible and scalable so the data team is constantly able to work on new projects vs. maintaining old ones. This is as easy as following the seven fundamental steps to completing a data project:
DEFINE: Define your business question or business need: what problem are you trying to solve? What are the success metrics? What is the timeframe for completing the project?
IDENTIFY DATA: Mix and merge data from different sources for a more robust data project.
PREPARE & EXPLORE: Understand all variables. Ensure clean, homogenous data.
PREDICT: Avoid the common error of training your model on both past and future events. Train only on data that will be available to you when a predictive model is actually running. Choose your evaluation method wisely; how you evaluate your model should correspond to your business needs.
VISUALIZE: Communicate with product/marketing teams to build insightful visualizations. Use visualizations to uncover additional insights to explore in the predictive phase.
DEPLOY: Determine if the project is addressing an ongoing business need, and if so, ensure the model is deployed into production for a continuous strategy and to avoid one-off data projects.
TAKE ACTION: Determine what should be done next with the insights you’ve gained from your data project. Is there more automation to be done? Can teams around the company use this data for a project they’re working on?
There is no doubt data science, machine learning, and predictive analytics combined with Big Data will become an even more fundamental part of both online and traditional retail in the coming years. All retail organizations will use it, but only the successful ones will have an effective data production plan that yields the most effective insights into their business that gives them an edge over the competition.
To learn more about how Data Science can play a role in Retail download the free guide from Dataiku, 4 Big Challenges for Retailers, Solved with Predictive Analytics.
5—Moving from Latina Business Owner to Entrepreneur in Silicon Valley
Guest post by Jennifer Elena, Founder & CEO, Jelena Group
As a Latina entrepreneur, I am optimistic on the future of Hispanic businesses but I see there is still work to be done in the Latino entrepreneurship space and for reasons like this, I feel emboldened to share my story and a few lessons learned from my peers that may help fellow Latino entrepreneurs.
Share the Risk: According to Stanford’s 2016 State of Latino Entrepreneurship study, Hispanic businesses are open to support themselves but not necessarily for market opportunities. Silicon Valley start-ups think the opposite. They don’t limit their ideas to the size of their current bank accounts, but rather ask themselves, “Where is the biggest opportunity?” and “How do I rally my resources?” Share the risks with other people’s money and use outside funding sources. A smart idea is to work with your banker early in the process and establish reasonable amounts needed for a working line of credit for your business. There is a balance between taking a reasonable risk and over reaching with borrowed money.
Over half (55%) of Latino business owners use none or one capital sources to finance their businesses at the early stages. If Latino firms adapted the Silicon Valley mindset and sought out resources and capital, within reasonable amounts, they could close the $1.3 trillion opportunity gap that exists today.
And the first thing to ask yourself before you reach out to partners or investors: “Who will buy what I am offering” and “Will there be enough buyers to ensure my success in this business?”
Think Big (But Smart): There is a Chinese proverb every entrepreneur should be familiar with: “If you want to go fast, go alone. If you want to go far, go with a team.” Scaling businesses is a challenge for Hispanic business owners, but research suggests a pattern where owners who use external funding sources early on are more likely to use external funding sources to grow their businesses. The reason behind this pattern is multi-faceted, but the implication is that looking to external resources inadvertently builds a team and network of mentors, partners, and venture capitalists that can help you grow your business. Hispanic-owned businesses are hesitant to give up equity, but what’s more valuable—100% of a $1 million business or 60% of a $20 million business? The key to building a successful business is to build an ecosystem, be authentic, ask for what you need and be willing help others when they ask you. Namaste.
Look for team members who understand that small businesses are very different than large businesses. The same skills and traits that may be effective in large business rarely translate well to a small business. Look for individuals who come from a small business background—people who’ve had to be simultaneously Chief Financial Officer and “Call Key Operator” for the copy machine. Big company personnel are used to having a specialized staff behind them and often lack the ability to cover all the areas that a small business needs of its staff.
Build Your Ecosystem: Your success relies on your ecosystem. The peers, vendors, consultants, advisors, coffee shops, interns, and the risk takers you surround yourself with. If you want to be an entrepreneur, find entrepreneurs who did it before and were successful. We need a trusted ecosystem we can turn to and figure out our next step, but 45% of Latino businesses don’t belong to an organization or network. As entrepreneurs, we are problem solvers and need to learn to pick up the phone and share our challenges so we can keep moving forward.
A great place to start building your ecosystem is your bank. Bankers experienced with successful small business entrepreneurs can put you in touch with potential mentors and team members. Bankers are not, however entrepreneurs. Nor are accountants or lawyers. Accountants and lawyers may not understand marketing or how business finances, operations and marketing are so closely connected. Surround yourself with previously successful entrepreneurs who understand how these elements work together, and one day you’ll be the “successful entrepreneur” giving back to your ecosystem of new entrepreneurs and with helpful advice.
6—Inspiring Role Models for Women Entrepreneurs
The Story Exchange inspires women entrepreneurs once again with The Passionate & Purposeful, its 2017 list of stand-out women entrepreneurs who have turned their passions and desires for purpose beyond themselves into successful, impactful organizations. The Passionate & Purposeful features six very different women who found their callings and created ventures that feed their souls and contribute to the world.
7—Guide to Evaluating Employees
One of the hardest things for small business owners to do is review their employees’ performances. If that’s you, check out this quick guide from Betterteam for help.
8—Meet the Winners
A few months ago, we told you about the FedEx Small Business Grant Contest. Now you can meet the winner—Sword & Plough, a company that works with American manufacturers who employ veterans to make wearable goods out of recycled materials from the U.S. military. Denver-based Sword & Plough won a $25,000 grant, plus $7,500 in FedEx Office® print and business services to help them grow their business and produce additional marketing materials to help expand their brand ambassador program, which is primarily made up of veterans and military spouses.
The company was cofounded by two sisters Emily Núñez Cavness, an active duty U.S. Army officer and her sister Betsy Núñez who grew up in a military family and recognized the challenge that veterans face in finding meaningful work after military service and were inspired to help. Sword & Plough works with American manufacturers who employ veterans to make wearable goods out of recycled materials from the U.S. military that would otherwise be thrown away. The durable fabrics combined with leather accents and other American-made textiles produce fashionable, urban bags and other accessories. Since launching the company in 2013, Sword & Plough has hired 65 veterans and repurposed over 35,000 pounds of military surplus. The socially-conscious company also donates 10% of their profits to veteran organizations each year they have been in business.
Check out Sword & Plough’s video.
9—Increase Your Billable Hours
TSheets, a top developer of time tracking software, just announced a deeper integration with Intuit’s QuickBooks Online designed to deliver accurate payroll and invoicing—all without manual entry. This seamless integration, where TSheets time tracking and reporting functionality is discoverable inside QuickBooks Online, enhances the collaboration between the two products, allowing small businesses to streamline their invoicing and payroll processes, and in turn maximize their profits.
One customer implemented the TSheets + QuickBooks Online program and discovered they were losing about 26% on unbilled time and inaccurate payroll every month. The program makes it easier to properly track billable time and labor hours.
There are 6 million small businesses with hourly employees in the US. “Our mission is to help small business owners succeed. We couldn’t be more excited to advance the TSheets + QuickBooks Online user experience, where combined, our customers can increase their billable hours and save on gross payroll costs. There is potential for a significant increase to the bottom line for these hardworking business owners,” says Kyle Jenke, TSheets’ SVP of Platform and Global Business Development.
You can try TSheets and experience this seamless integration with QuickBooks Online free for 14 days. After the free trial period, TSheets is available for a base fee of $16 per month and an additional $4 per user, per month.
Check out this video for more information.
10—Accounting Program Updates
This was a busy week for the folks at Sage. It released several updates to its software including:
Start Up with Sage: Sage One with Pegg—The world’s first accounting chatbot is now linked directly to Sage One. Pegg acts as a smart assistant, enabling users to track expenses and manage finances through popular messaging apps like Facebook Messenger and Slack. It’s also integrating with Amazon’s Alexa.
Scale Up with Sage: Sage 50c—Sage’s trusted accounting solution now gives customers greater flexibility and power with the integration with Microsoft Office 365. This new version is designed to give Sage 50 customers complete control over their accounts.
Sage Live: A customizable and cost-effective cloud accounting solution, built on the Salesforce Lightning user interface, enables customers to manage multiple locations and currencies all in the palm of their hand. Available now on both iOS and Android.
Sage Enterprise: Sage X3—A business management solution tailored to the needs of demanding, growing businesses. The latest iteration of this cost-effective ERP solution changes how midsize businesses and enterprises compete and grow.
Sage Accountants: Sage Accountant Cloud—A new connected platform that brings together a portfolio of cloud applications to provide an overall view of their firm. This allows accountants to manage their practice and their clients more efficiently than before and provide additional enhanced services, from one central point. This will be available in the UK in the summer and in the U.S. this fall.