NEW INC. MAGAZINE COLUMN BY HOWARD TULLMAN

 

In an Ever More Remote World, It Pays to Protect Your Data

We've all been busy coping with being cooped up and dodging a deadly pandemic to concern ourselves with mundane things like password security. But the threat is bigger today. 

BY HOWARD TULLMAN@TULLMAN

We've been home for more than a year now and things are finally starting to look up, which is great news. Some of us gained new skills, some of us grew new appendages, some of us thought about all the things we were gonna do and didn't. And many of us dodged a different and very scary bullet that we probably didn't give five minutes of thought to the entire year: Being hacked and having our identities stolen. 

Amazingly, even though tens of millions of us worked from home and shared our devices (willingly or otherwise) with wives, kids, relatives, friends, neighbors, co-gamers and visitors, we didn't have the enormous wave of password and identity theft, ransomware, and related frauds that have been anticipated. Some 80% of data breaches are due to poor password security - we reuse the same, easy-to-guess password on multiple websites, and we rarely if ever change the passwords.

As the saying goes, the world's divided into folks who have been hacked and folks who don't know that they've been hacked. Current estimates are that more than 20 billion stolen logon credentials are presently floating around and being bought and sold on the Dark Web by cybercriminals.

Whatever your current status--confusion, indifference, ignorance or avoidance - now is exactly the right time to protect your passwords. Being forewarned is a great way to be forearmed and insulated from risks like these, but only if you heed the warnings. Get some password protection - get it organized and installed of all your devices (and those of your family members) - and do it now because it's no longer a question of if you'll be hit, it's just of question of when and how hard.

This isn't Chicken Little stuff -the Russians just pulled off a remarkable hack of FireEye, a supposedly top cyber security firm, to breach the Treasury Department and God knows what else.  Just ask anyone who's been a victim about the time, pain, cost and grief associated with having your devices compromised, your passwords stolen, and your credit and identity ripped off.  And remember that the most likely people to leave the doors open for the bad guys are you and those closest to you - your own family and your employees. It's not because they're bad people obviously, it's just that these kinds of things aren't top of mind for them or even in their heads. So, it's all on you.

And a word to the wise: be careful which data protection program you pick because you will be investing some amount of your scarce time in the set-up as well as entrusting your very sensitive information to a third party. Make sure your pick will be here for the long run with the team, talents, resources and tools to keep up with the continual threats and new technologies and provide the necessary support and infrastructure to grow with the market as well. You want a company that's a keeper.

More technology-based, early-stage businesses with a real product or service fail because they can't manage their growth than starve for lack of business and opportunities. You want a privacy and protection "partner" who's been around 5 or 10 years, has a demonstrated record of success with both consumers and enterprise customers, is highly rated in the app stores (where people put their money where their mouth is), and has grown steadily and consistently and reached a million or more current users.

Online reviews can be somewhat helpful guides especially in a world where there are constantly new entrants of uncertain and largely unknown backgrounds. Many of these aspiring players have unclear chops and modest financial resources and won't be here in a year or two. But I've been consistently under-impressed with most of the mainstream computer press articles which try to rank the major vendors. The rating sites like TrustPilot  and G2 Crowd are a much better bet.

I don't want to fall into the same advice trap although I believe that there's a clear winner in this particular race. What's more useful is to give you a short checklist - in addition to the concerns and issues I have mentioned above - to compare the various providers so that you can make a careful and informed choice. You won't find me talking about cost because (a) the costs are trivial and (b) just avoiding the financial risks to you, your family and your business is worth many multiples of whatever you end up paying. This isn't something that you try to do on the cheap. Decide who's the best and best-suited for your needs and go from there.

Here's my short list of critical criteria.

(1)   At least a million or more paid annual users. Trial is easy - forget it. Subscriptions are hard, sticky, and mean something serious.

(2)   Strong, positive user ratings, especially across all the app stores and, of course, the offering needs to be multi-platform.  

(3)   A solid balance sheet and firm financial backers. Startups come and go - you want to trust your security to a solid, well-funded organization that will be here for the long run. One that plans and advances development over decades. Think Google, not GameStop.

(4)   A technical solution based on Zero Knowledge (end-to-end encryption) so that no one - inside or outside the organization - knows anything about the data and information stored on their servers. Startups turn over - tech company employees are notorious for job hopping - and all it takes is one depressed or disgruntled employee to put your data at risk unless the provider is committed to, and consistently enforces, this type of vault security.

(5)   A demonstrated commitment to innovation, iteration and continuous improvement without which the world and the emergent technologies will quickly obsolete their products and programs.

(6)   And finally, independent, third-party security vetting and certifications (NCC Group, ISO, etc.) coupled with systematic public disclosure protocols for vulnerabilities and an ongoing program to encourage and regard bug discoveries.

Bottom line: you've been warned. The smart money always bets on prevention rather than cure. You don't want to be the next poster boy or girl for "too little, too late".

MAR 30, 2021

 

NEW COLUMN FROM HOWARD TULLMAN IN LOOP NORTH NEWS

 

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Six things to consider before you start a business now It’s tempting, particularly for cashiered corporate warriors. But temptation isn’t enough. You need a compelling reason and a compelling product. By Howard Tullman 29-Mar-21 – As we emerge from the pandemic, I expect that a lot of newly unemployed, especially 40+ professionals, will be wondering what to do next. There’s going to be no going back for millions of these people – unemployment was 6.2 percent in February vs. 3.5 percent the prior year – and sadly, the prospects of shifting to another employer in the same or adjacent industry sectors are looking pretty grim. The pandemic has provided ample cover and convenient excuses galore for cost cutting, workforce reductions, and compensation caps that will be with us long after the last vestiges of the virus. A lot of the job shrinkage we’re seeing is structural and permanent and – in certain industries – long overdue. But, even in those spaces where rebuilding has begun, most of the available slots are going to be filled by younger, cheaper, and more technical talent. No one is going to tell older applicants to their faces, but employers today are too often looking for youthful energy – and even inexperience – rather than lengthy employment histories, “experience,” and all the baggage that comes with it. They’d rather save some money, start from scratch, and “grow their own.” Older employees lecture; younger folks, ideally, listen and learn. As a result, after getting kicked in the teeth a few too many times, the prospect of starting their own businesses will look pretty attractive to many of these WFH warriors. And it sure beats being turned down for jobs for another six months. No one – except their family members and maybe their financial advisors – can really tell them not to do it. And they’re pretty sick of hearing “no” all the time. No one is going to tell older applicants to their faces, but employers today are too often looking for youthful energy – and even inexperience – rather than lengthy employment histories, “experience,” and all the baggage that comes with it. As a result, after getting kicked in the teeth a few too many times, the prospect of starting their own businesses will look pretty attractive to many of these WFH warriors. Being an entrepreneur is great – I can attest to that. But don’t kid yourself; take a long look before you leap. Startups are hard and starting over is even harder – especially when you’ve accumulated a bunch of family obligations and other financial commitments. At a minimum, you’ve got to do a serious personal inventory and really ask yourself honestly whether you’ve got the stuff and the stomach for what this is going to take. And it goes without saying that if your idea is just another “me-too” business with nothing distinctive to set it apart, please don’t start. Remember that for every breathless story bragging about some overnight startup success there are dozens of other wannapreneurs who are back on the bread line. They may have started, but they never upped. In any event, before you insist on heading down this very precarious path, here are a few important things to keep in mind. Believe me when I tell you that whatever you ultimately decide, you’ll thank me later. 1 Assume that your accumulated technical skills, training, and expertise – as opposed to your people skills – will be largely undervalued and useless. As time passes and we rise in our organizations, our skill sets change. We possess and develop far more “soft” skills around things like management and organization and communication. We move further away from the day-to-day use and application of the “hard” skills we initially had. There may be exceptions with regard to specific areas of technical expertise, but even the best software engineers soon find themselves spending more time managing people than writing code. In the world of tech in particular, there’s a fair amount of age/experience bias, which is to say that your prior skills may be thought to be outdated or worse, and the highly structured and peer-reviewed way you were taught may sound old fashioned in the frenzied, spaghetti-code startup world. It’s not just an issue in the software industry. In my restaurant businesses, a persistent adage was that old bartenders tended to bring their bad habits with them. They’d rob you blind until you caught them and then they’d find another job somewhere else. Sadly, when you’re on the street and outside of the context of your previous organizational responsibilities, many of these softer skills are hard to quantify and demonstrate. Worse yet, in a very small new business, it’s not at all clear that there’s much value or opportunity to apply them. The best office manager in the world, who actually did a million different and important things for his or her business – and was in reality much more of a COO – still reads like an “office manager” on paper. One important idea here: try to bypass the resume process entirely by focusing on old connections, relationships, and people who actually know you and what you can do. 2 Forget the concept of the “highest and best use” of your time. We’re all proud of our own talents and abilities and we’re taught over the years to optimally apply them and to maximize our impact. One eye is always on “the highest and best use” of our own time and energies to move the ball forward and toward the company’s ultimate goals. Well, you can pretty much forget that idea for a while. You’ll need to roll up your sleeves and get used to doing anything and everything that needs to get done regardless of whether you’re the best person to do it. The best entrepreneurs say, “nothing is beyond me and nothing is beneath me,” and now’s your chance to live the dream. I don’t mean to make light of this process because, in taking out the trash or doing whatever it takes, you’re definitely modeling the behavior that you want your people to emulate. But that doesn’t make the garbage stink any less. Many of the old adages and reliable rules just don’t matter in the new world. You have to teach yourself to remember to forget some of the “tried and true.” Just focus on muddling through for starters. 3 Plan on working (at least for a while) with employees you would never have hired in your last position. Beggars can’t be choosers and, as soon as you enter the real world and no longer have an HR department or a self-selecting stream of Type A players, you’ll quickly discover that you have to take whatever you can get in the way of initial employees and just hope for the best. Managers coming from traditional firms have no idea of just how commonly focused, closely aligned, and homogeneous their prior fellow employees were concerning values, goals, and career metrics, regardless of their apparent “diversity.” Your new business – especially while you’re trying to create and cultivate a company culture – will be full of folks with different lifestyles, variable work ethics, and loads of attitudes. Your job is to make room for all of them. One critical tip here: the way to avoid constant heartaches and regular disappointment is to lower your expectations going in and hope to be surprised on the upside. 4 Patience is more than just a virtue, it’s a painkiller as well. By the way, you’re going to need to practice being way more patient and forgiving than you’ve been for years and not just with your own kids. It can seem like no one but you is in a hurry and that the whole world – investors, vendors, partners, lenders, and, of course, your employees – is moving in slow motion. They don’t get it, but then again, they don’t have to because they don’t really understand or care about your constraints. Don’t get angry – they’re not out to get you, they’re just looking out for themselves, just like you always did. And, just to be clear, you’re not such a great bargain yourself. You need to get used to being the dumbest guy or gal in the room for a few months and just hope that all these other folks will give you a break. If you’re foolish enough to try to open a restaurant, you better know something about standing in front of a hot stove or else you’ll discover that it’s the cooks who really control the business. If you’re an absentee landlord, like it or not, your newest “partner” is going to be the plumber when the pipes freeze or the potty overflows. By and large, the people you’ll employ know what they’re doing and how to do their jobs (when they get around to it), but you’re also supposed to know their jobs, the way forward, how to tell the future, and how to find the pot of gold at the end of the rainbow. As you might imagine, it’s likely to take a little time for you to get there. Be patient. 5 Your job is not to educate or lecture your customers. It’s to satisfy them. Customers are in a whole different category. I realize that the startup gospel establishes the customer as king and always correct, but as often as not, in the day-to-day trenches, that’s a crock. It’s a great idea and a wonderful ideal, but hard to live up to every day. Customers come in all sizes and kinds – some are frazzled and scared, some are cranky, some are slick, some are too careful and choosy for words, and, especially these days, most of them are there for a simple reason – to get in, get what they need, and get out. They aren’t looking for an experience, they don’t care about your shtick even if you do, and they aren’t there to make your day. Your job is to grin and bear it. Not to reform them. Not to patronize them or unctuously “explain” things to them. They are there – hopefully to buy – for their own reasons and they don’t really need your help. This isn’t quite the warm and fuzzy dream environment that you had in mind. Get used to it. 6 Don’t think money is going to solve your problems or make your new business a success. Just as a lawyer representing himself has a fool for a client, it’s easy for a relatively affluent new entrepreneur to get in the habit of being the business’s banker, lender, and/or best investor as well as its CEO and chief salesperson by injecting too much of his or her own cash too often in order to make up for the business’s shortfalls in sales or to help cover fixed costs. Investment dollars, regardless of where they come from, are worth a tiny fraction of the dollars generated by real sales of products or services in large part because investment is not an effective measure of progress, traction, or the likelihood of ultimate success. But when the dollars are coming out of the entrepreneur’s own pocket, it’s the worst and most costly kind of delusion. And, as an aside, hell on your family as well. Don’t despair, just think of this as an opportunity to learn all those things that money can’t buy. Perseverance is fine, but this is a very slippery slope. You need to agree – with all of the interested stakeholders – from the very start that there’s a dollar limit you’re willing to commit. Establish some concrete milestones and a realistic overall timeframe for your little venture and, if the dogs don’t start eating the dog food, and profitability is always just around the next bend, that you’ll be smart enough to call it a day and think about getting a day job no matter how hard that is to come by. So go ahead and take your shot but understand that it’s going to be far more of a grind that you ever imagined and thankless as well for a very long time. And harder still when you’re no longer exactly limber and wet behind the ears. If you thought work was tough, working for yourself is a hundred times tougher and, since you’re working for plenty of other people as well, you’ll have “bosses” galore – all with plenty of opinions and expert advice. There will be long days and even longer sleepless nights. And you’ll find that you’re too old to cry and that it hurts too much to laugh. Just sayin’. Howard Tullman is General Managing Partner for G2T3V, LLC – Investors in Disruptive Innovators, and for Chicago High Tech Investors, LLC. He is also the author of You Can’t Win a Race With Your Mouth: And 299 Other Expert Tips from a Lifelong Entrepreneur. By Howard Tullman | Loop North News | h@g2t3v.com

THE ART OF INNOVATION - APRIL 7TH

 

NEW INC. MAGAZINE ARTICLE BY HOWARD TULLMAN

 

What to Do Now. (Hint: "Nothing" is Not an Option)

The pandemic has accelerated trends such as touchless everything. You may not like these changes, but you do need to figure out how to make them work for your business. 

 

BY HOWARD TULLMAN@TULLMAN

 

One of the most pervasive impacts of the pandemic across every industry has the acceleration of change.  Many changes were already on the way but almost all of them are here whether we like it or not. The list is massive and continually growing:  video conferencing, telemedicine, e-sports, remote and distributed work, virtual restaurants, and touchless everything. One critical case in point, consultant Kearney estimates that the adoption of e-commerce has been accelerated by five years in just the past year.

And these changes are now increasingly and seamlessly integrated into our everyday lives. And here to stay. We're not all happy about the speed, scope and scale of all the changes or the fact that they all seem to be happening simultaneously. But almost every entrepreneur I know is excited about how those shifts will likely open new product and market opportunities, grow customer adoption and headcounts, and create a greater willingness to experiment with and accept novel and innovative solutions to any number of systemic problems.

At the moment, though, the most important trick seems to be making sure that you can weather the interim storms and bumps in the road that are inevitable in transitions of this magnitude, so that your business is around to take full advantage of the good times as they slowly return.

There are at least three typical responses to rapid change like this, but only one makes sense if you're planning to stick around.

First, and worst, is to do nothing. Nothing new. Nothing different. Just trying to get back to business as usual in a world that's changed radically and forever.  You know in your heart that ignorance as a strategy choice makes little sense but it's the "painless" path of least persistence. At least for a little while. Soon enough, your competition will run right past you and your customers will find better, more accessible and more attractive new alternatives.

The reality is that any direct and immediate action is better than none -- even if all the moves you're making might not be in the right direction.  It's not wrong to be wrong. It's wrong to stay wrong. You're much better off trying to do something and failing than you will ever be trying to do nothing and succeeding. But be sure to be honest with yourself and recognize that make-work projects and keeping busy just for the sake of filling time aren't going to help you change the trajectory. It's like poking a balloon with your finger - you might displace or move the problems - but you aren't effectively responding to or resolving them.

What we know for sure is that if you're not pushing the ball forward - at whatever pace and in whatever direction makes you comfortable - you're slowly slipping backwards. Like riding a bike, as long as you're in motion, you won't fall over. Try to stand still, and you're likely to flop.

The second equally fruitless approach is a page right out of the immediate past insanity of our most recent ex-President. Trying to build walls to hold off the future is a wanton and wasteful exercise in wishful thinking, even apart from the fact that walls clearly won't work. It's not even obvious that the people who are desperately attempting to stave off the alleged onslaughts understand who they're trying to keep in and who they hope to exclude. Trying to interpose fixed barriers, painful process and onerous restrictions and other novel limitations is akin to placing picket fences in front of the oncoming floods. A fool's errand and doomed to fail.

Watching so many colleges try to desperately hang on to full tuition charges in the face of parents and students revolting against virtual and remote learning models is a good example of businesses trying to stop the sudden stampede without offering credible and viable alternative solutions. In times like these, agility, fluidity and flexibility - bending without breaking - is critical to survival. Walls and dams - however solid, sturdy and fixed - will be promptly and readily overrun or avoided just as they have been throughout history. On the other hand, carefully constructed and deployed moats are an entirely different matter. But even the best moats require constant attention, continual maintenance, and regular enhancement. Nothing gets better by itself.

The best solution of all, however, is to focus on building bridges rather than barriers. Reaching out to others and constructing win-win partnerships, mutually beneficial relationships, and shared platforms beyond the resources of any of the individual participants are going to be crucial to surviving in a post-pandemic world where we can expect increased market and industry consolidation overall with the big few industry leaders continuing to grow. You're gonna need a helping hand and some of life's most challenging decisions are always which bridges to build and which to cross or not.

The key to sustainable success going forward for new and growing businesses is to understand that it's going to be increasingly impossible to provide for and satisfy all of the needs of your present and future customers by yourself. All the bright ideas for easy businesses built by Lone Rangers have been tried and taken. And, even more importantly, it's critical to appreciate that it makes little or no sense to even try to do everything alone because you couldn't be all things to all people under the best of circumstances.

Finding and connecting to strong partners who can supplement your skills and talents, focusing on what you can do far better than anyone else, outsourcing the things you can seamlessly offload to others, and ultimately shedding all of the commoditized functions and services to which you bring nothing special are the ways to streamline and trim your particular offerings. That will allow you to differentiate from the pack and provide a compelling and unique set of incentives and values to the customers you really want to attract.

No one has the time, resources or even any reason to try to hold off the future. Shrinking and simplifying your strategy, focusing and carefully directing your attention and efforts, and building bridges to others who can help you leverage your strengths and strengthen your offerings are the most effective ways forward.

MAR 23, 2021

Howard Tullman Appears on Bootstrapping in America - Tasty Trade

 

             WATCH THE VIDEO ABOVE

LOOP NORTH NEWS

 

		54 °

If you’re just getting back to basics, you may be too late Good times and bad times come and go. But the fundamentals of sustaining your business should never change. By Howard Tullman 22-Mar-21 – As the day-to-day, real-world economy starts to slowly recover – as opposed to the ongoing and inexplicable insanity driving Wall Street – the businesses that are going to be winners in 2021 have already largely been determined. Not because of competitive considerations, or the impact of bogus congressional hearings or expected regulatory interventions or because, rightly or wrongly, they scored big in the PPP lottery and don’t plan on paying a dime back. Not because they invented something so radically new that it set the world on fire, cost less than a dollar, was non-fattening, and tasted like chocolate. And not because they raised ridiculous amounts of funding through new financial instruments, socially driven new market makers like Robin Hood, and investment vehicles like the utterly opaque special purpose acquisition companies (SPACs), which are everywhere today. Money in general may have no smell, but these SPACs smell vaguely familiar and seem sadly reminiscent of the collateralized debt obligations (CDOs) that destroyed the real estate and financial markets in the recession of 2007-2009. Nope. The answer is none of the above. The winners of tomorrow are going to be the men and women who spent 2020 – in the heart of the pandemic – getting ready for and setting the stage for success in 2021. The future’s successes are built on yesterday’s foundations. You can’t plant a seed in bad soil. The future isn’t known or certain, but it’s far more likely to be fun and favorable if predicated on a firm foundation and a disciplined and continual commitment to nurturing, enhancing, and expanding the connections you have and the critical relationships you need to maintain with your existing customers and prospects. The problem for too many company owners and operators, as well as millions of entrepreneurs, is that in good times they get too busy and in tough times they get too down to pay attention to executing the fundamentals. In the best of times, we convince ourselves that we’re geniuses and that our good fortune will never end. The next step after that delicious delusion is to start taking your customers for granted and forgetting that it’s never been easier for them to walk. Loyalty today means nothing more than the momentary absence of something better or cheaper – often right around the corner or a click away – unless you make sure that your clients and customers have good reasons to stay and that you are communicating those reasons effectively on a continuous basis. Communication is key and we often forget that your marketing spend needs to track your revenue growth if you want customers to keep coming back, and also spread your story through favorable word of mouth. Coasting or reducing your advertising, marketing, and incentive dollars because you’re too busy with your current business and making a lot of money is a guarantee that you won’t be too busy or too flush for much longer. And it’s also human nature in the worst of times – like the year we’ve just endured – to be conservative, to try to “cheap it out” for a while, and to reduce your promotion and marketing expenditures. No one in history has ever “saved” their way to success. The time to build and reinforce your brand and your longevity is in the tough times when the competition is often asleep at the switch. The people and businesses who keep in touch are the ones we’re going to be reaching out to as the world returns to near normal. It may still be sub-zero outside in many places, but those flower and garden catalogs keep coming and make for warm and fuzzy feelings and dreams about an early spring. Plant well and often and the harvest will take care of itself. Howard Tullman is General Managing Partner for G2T3V, LLC – Investors in Disruptive Innovators, and for Chicago High Tech Investors, LLC. He is also the author of You Can’t Win a Race With Your Mouth: And 299 Other Expert Tips from a Lifelong Entrepreneur. By Howard Tullman | Loop North News | h@g2t3v.com

Article on Brands in New Issue of MAIZE by Howard Tullman

 

 MAIZE 

Post-pandemic: protect and bolster your brand

In a world that is changing, so must your strategy

BY Howard Tullman

March 16, 2021

BUSINESS

As we celebrate the long overdue departure of the Insurrectionist-in-Chief and see every day how quickly and comprehensively even a fantasy brand (and a family) that was fundamentally fraudulent from the beginning can be entirely blown up and destroyed in short order, it’s important for every serious business to take the time and the necessary steps to protect, care for and bolster its own brand and their delicate connection to their customers.

While absence and distance may theoretically make the heart grow fonder, in today’s world as we slowly start to emerge from the pandemic, there are simply no guarantees that things will ever return to “business as usual” or, even more importantly, that your customers will be there ready, willing and waiting for your return and reopening unless you take action now to turn that fragile prospect into a solid promise. Wishful thinking isn’t a great strategy and counting on old habits simply isn’t smart. Old habits may die hard, but the web and the pandemic have opened up a whole new world of choices for even the most diehard fan.

The primary idea to keep in mind is that a lot of what we commonly view as customer loyalty may simply be the product of frequent use, convenience and ease of access, and the absence of a better alternative. Thinking that your former and current customers are going to be blinded by and locked into their habits is a bad bet which sells them short and takes them for granted in a dramatically altered marketplace. As customers emerge from a long dark year of denial with, of necessity, radically changed purchasing and consumption behaviors, they’ll be better equipped and probably somewhat anxious and excited to seek out novel and different ways of doing things. That risk of migration is somewhat mitigated by the sheer volume of choices and offerings which leads quickly to decision fatigue. Brands are a shortcut and an easy way to avoid the hard work and the time it takes to evaluate and try something new. But brand connections aren’t unbreakable.

And, in some cases, the emergence of new technologies and low-cost readily available tools may simply provide customers, prospects and consumers with better value and stronger built-in solutions. Take the American Automobile Association (AAA) for example. As winter persists, I often think of why I have religiously renewed my AAA auto club membership in a time where Google, Waze and other on-board navigation systems have completely eliminated the need for TripTiks (remember those), where I can buy cheap and easy car insurance online by the mile these days (See www.mileauto.com), and where manufacturer-provided, no cost, roadside and towing assistance comes with virtually every decent vehicle and new direct startup competitors are also entering the market. (See www.roadsider.io). Most AAA members don’t even realize that the primary remaining use and value for that colorful little AAA card in your wallet is to surrender it to the nice policeman instead of your driver’s license the next time you’re stopped for speeding so that you can still get through the TSA screening at the airport.

The bottom line is that your brand is an ongoing promise. Great brands are earned every day and become shorthand and shortcuts for your business’s identity. If you are no longer delivering on the promises you’ve made or haven’t kept your offerings at least comparable to those of the competition, your customers have no reason to hang around. And in tough times like these, “good enough” really isn’t. Cookie cutters are for baking, not for branding.
With the advent of aggressive social media conversations and evaluations, the “crowd” is sometimes more in control of your brand than you are, and it only takes a few nasty notes about health or cleanliness concerns to create real problems for you. Listen carefully to your customers and work hard to anticipate their needs and expectations. You have got to up your game, differentiate your products and services, and give your customers compelling reasons to stay.

But please don’t try to compete on price. Once you head down that slippery slope and diminish your brand equity, you can never come back. As we start to see faint glimpses of some serious retail resurgence by late in the summer or early Fall, it’s easy to convince yourself that heavy discounting and sales are the way to quickly build traffic and revenue, but it’s a very bad bet.
Discounts train customers to buy on price, not brand or quality. This may drive one-time trials, but in the absence of real substance and value, you’ll just churn through these folks as they return to their old buying habits. Buying volume (just like tricking traffic through click-baiting on the web) is a short-term fix that’s not sustainable. If you want to hold new customers, you need to focus on delivering value and super service rather than simply the lowest price which – due to the persistent real-time competitive repricing on the web – turns out to be impossible anyway.

And also, be careful of the first “customers” back through the door. There’s a decent chance that they’re bottom feeders and bargain hunters and the very last people that you want associated with your brand and your business. Not only are they unlikely to buy, and highly likely to return worn materials in short order, but they’ll also scare off the real and serious buyers that you built your business on from the beginning. Or they’ll have loads of easy (and maybe suspect cash) and no taste. These are other aspects of brand fragility that you need to carefully manage.

You don’t want to become or be seen as a “Groucho” club. As Groucho famously said, “I wouldn’t want to belong to a club that would have me as a member”. Or be a place that’s so overrun with lookie-loos, that you have the Yogi Berra restaurant problem. As he observed: “Nobody goes there anymore. It’s too crowded.”

Read more about Tullman’s recent works on this topic here and here.

NEW INC. MAGAZINE COLUMN BY HOWARD TULLMAN

 

Should You Start a Business Now?

It's tempting, particularly for cashiered corporate warriors. But temptation isn't enough. You need a compelling reason--and a compelling product. Here are six things to consider before you take the plunge.

BY HOWARD TULLMAN@TULLMAN

As we emerge from the pandemic, I expect that a lot of newly unemployed, especially 40+ professionals, will be wondering what to do next. There's gonna be no going back for millions of these people (unemployment was 6.2% in February vs. 3.5% the prior year) and sadly the prospects of shifting to another employer in the same or adjacent industry sectors are looking pretty grim. The pandemic has provided ample cover and convenient excuses galore for cost cutting, workforce reductions, and compensation caps that will be with us long after the last vestiges of the virus.

A lot of the job shrinkage we're seeing is structural and permanent and - in certain industries - long overdue. But, even in those spaces where rebuilding has begun, most of the available slots are going to be filled by younger, cheaper and more technical talent. No one is going to tell older applicants to their faces, but employers today are too often looking for youthful energy (and even inexperience) rather than lengthy employment histories, "experience," and all the baggage that comes with it. They'd rather save some money, start from scratch, and "grow their own." Older employees lecture: younger folks, ideally, listen and learn.

As a result, after getting kicked in the teeth a few too many times, the prospect of starting their own businesses will look pretty attractive to many of these WFH warriors. And it sure beats being turned down for jobs for another six months.  No one (except their family members and maybe their financial advisors) can really tell them not to do it. And they're pretty sick of hearing "No" all the time.

Being an entrepreneur is great -- I can attest to that. But don't kid yourself; take a long look before you leap. Startups are hard and starting over is even harder - especially when you've accumulated a bunch of family obligations and other financial commitments. At a minimum, you've got to do a serious personal inventory and really ask yourself honestly whether you've got the stuff and the stomach for what this is gonna take. And it goes without saying that, if your idea is just another "me-too" business with nothing distinctive to set it apart, please don't start.

Remember that, for every breathless story bragging about some overnight startup success, there are dozens of other wannapreneurs who are back on the bread line. They may have started, but they never upped. In any event, before you insist on heading down this very precarious path, here are a few important things to keep in mind. Believe me when I tell you that whatever you ultimately decide, you'll thank me later.

(1)   Assume that your accumulated technical skills, training, and expertise (as opposed to your people skills) will be largely undervalued and useless.

As time passes and we rise in our organizations, our skill sets change.  We possess and develop far more "soft" skills around things like management and organization and communication.  We move further away from the day-to-day use and application of the "hard" skills we initially had. There may be exceptions with regard to specific areas of technical expertise, but even the best software engineers soon find themselves spending more time managing people than writing code.

In the world of tech in particular, there's a fair amount of age/experience bias, which is to say that your prior skills may be thought to be outdated or worse and the highly structured and peer-reviewed way you were taught may sound old fashioned in the frenzied, spaghetti-code startup world. It's not just an issue in the software industry. In my restaurant businesses, a persistent adage was that old bartenders tended to bring their bad habits with them. They'd rob you blind until you caught them and then they'd find another job somewhere else.    

Sadly, when you're on the street and outside of the context of your previous organizational responsibilities, many of these softer skills are hard to quantify and demonstrate. Worse yet, in a very small new business, it's not at all clear that there's much value or opportunity to apply them. The best office manager in the world, who actually did a million different and important things for his or her business (and was in reality much more of a COO) still reads like an "office manager" on paper. One important idea here: try to bypass the resume process entirely by focusing on old connections, relationships and people who actually know you and what you can do.

(2)   Forget the concept of the "highest and best use" of your time.

We're all proud of our own talents and abilities and we're taught over the years to optimally apply them and to maximize our impact. One eye is always on "the highest and best use" of our own time and energies to move the ball forward and toward the company's ultimate goals. Well, you can pretty much forget that idea for a while. You'll need to roll up your sleeves and get used to doing anything and everything that needs to get done regardless of whether you're the best person to do it.

The best entrepreneurs say "nothing is beyond me and nothing is beneath me" and now's your chance to live the dream. I don't mean to make light of this process because, in taking out the trash or doing whatever it takes, you're definitely modeling the behavior that you want your people to emulate. But that doesn't make the garbage stink any less. Many of the old adages and reliable rules just don't matter in the new world. You have to teach yourself to remember to forget some of the "tried and true."  Just focus on muddling through for starters.   

(3)   Plan on working (at least for a while) with employees you would never have hired in your last position.

Beggars can't be choosers and, as soon as you enter the real world and no longer have an HR department or a self-selecting stream of Type A players, you'll quickly discover that you have to take whatever you can get in the way of initial employees and just hope for the best. Managers coming from traditional firms have no idea of just how commonly focused, closely-aligned and homogeneous their prior fellow employees were concerning values, goals, and career metrics, regardless of their apparent "diversity."  Your new business - especially while you're trying to create and cultivate a company culture - will be full of folks with different lifestyles, variable work ethics, and loads of attitudes. Your job is to make room for all of them.  One critical tip here: the way to avoid constant heartaches and regular disappointment is to lower your expectations going in and hope to be surprised on the upside.

(4)   Patience is more than just a virtue, it's a painkiller as well.

By the way, you're going to need to practice being way more patient and forgiving than you've been for years and not just with your own kids. It can seem like no one but you is in a hurry and that the whole world - investors, vendors, partners, lenders, and, of course, your employees - is moving in slow motion. They don't get it, but then again, they don't have to because they don't really understand or care about your constraints. Don't get angry - they're not out to get you, they're just looking out for themselves, just like you always did.

And, just to be clear, you're not such a great bargain yourself. You need to get used to being the dumbest guy or gal in the room for a few months and just hope that all these other folks will give you a break. If you're foolish enough to try to open a restaurant, you better know something about standing in front of a hot stove or else you'll discover that it's the cooks who really control the business. If you're an absentee landlord, like it or not, your newest "partner" is gonna be the plumber when the pipes freeze or the potty overflows.

By and large, the people you'll employ know what they're doing and how to do their jobs (when they get around to it), but you're also supposed to know their jobs, the way forward, how to tell the future, and how to find the pot of gold at the end of the rainbow. As you might imagine, it's likely to take a little time for you to get there. Be patient.

(5)   Your job is NOT to educate or lecture your customers. It's to satisfy them.

Customers are in a whole different category. I realize that the startup gospel establishes the customer as king and always correct, but as often as not, in the day-to-day trenches, that's a crock. It's a great idea and a wonderful ideal, but hard to live up to every day.

Customers come in all sizes and kinds - some are frazzled and scared, some are cranky, some are slick, some are too careful and choosy for words, and, especially these days, most of them are there for a simple reason - to get in, get what they need, and get out. They aren't looking for an experience, they don't care about your shtick even if you do, and they aren't there to make your day.

Your job is to grin and bear it. Not to reform them. Not to patronize them or unctuously "explain" things to them. They are there - hopefully to buy - for their own reasons and they don't really need your help. This isn't quite the warm and fuzzy dream environment that you had in mind. Get used to it.

(6)   Don't think money is going to solve your problems or make your new business a success.

Just as a lawyer representing himself has a fool for a client, it's very easy for a relatively affluent new entrepreneur to get in the habit being the business's banker, lender and/or best investor as well as its CEO and chief salesperson by injecting too much of his or her own cash too often in order to make up for the business's shortfalls in sales or to help cover fixed costs. Investment dollars, regardless of where they come from, are worth a tiny fraction of the dollars generated by real sales of products or services in large part because investment is not an effective measure of progress, traction or the likelihood of ultimate success. But when the dollars are coming out of the entrepreneur's own pocket, it's the worst and most costly kind of delusion. And, as an aside, hell on your family as well. Don't despair, just think of this as an opportunity to learn all those things that money can't buy.

Perseverance is fine, but this is a very slippery slope. You need to agree (with all of the interested stakeholders) from the very start that there's a dollar limit you're willing to commit. Establish some concrete milestones, and a realistic overall timeframe for your little venture and, if the dogs don't start eating the dog food, and profitability is always just around the next bend, that you'll be smart enough to call it a day and think about getting a day job no matter how hard that is to come by. 

So go ahead and take your shot, but understand that it's going to be far more of a grind that you ever imagined and thankless as well for a very long time. And harder still when you're no longer exactly limber and wet behind the ears. If you thought work was tough, working for yourself is a hundred times tougher and, since you're working for plenty of other people as well, you'll have "bosses" galore - all with plenty of opinions and expert advice.

There will be long days and even longer sleepless nights. And you'll find that you're too old to cry and that it hurts too much to laugh. Just sayin'.

MAR 16, 2021

JUDY'S BIRTHDAY DRIVE-BY