the goose

In 1997, a freshly minted Saatchi & Saatchi were handed a brief by the Conservative government to discourage teens from smoking via the all-powerful medium of advertising.  Setting about the task, running focus groups and unleashing their creative juices, they started to realise a basic flaw in the traditional model.

Millions upon millions of pounds were spent, worldwide, telling young’un’s that “Cigaretets Kill”. Something we all know but mostly only those in their 30’s or older pay much attention to.

Why?

Dissonance

Telling young people that they will die from smoking contravenes a rather self-evident truth:  young people don’t die.  Certainly not in general and you would be unlucky to have reached the age of 13 (when most people start smoking) to have known anyone in your peer group that had passed on.

Saatchi & Saatchi changed tack and instead started running advertising pointing out how gross your breath smells after a cigarette.  Something that rings true and is oh so important when your still trying to get off your mark with Priscilla in 6b.

So here is the rub.  Entrepreneurs in Ireland don’t make it big.  We don’t really celebrate the successes and I think there is a tendency to expect failure.  This is especially acute when it comes to funded businesses.  At least two founders who raised multiple millions of dollars have both told me that they tell their founders that there was a 90% chance of failure.  Accurate and laudable as it may be – the intention can’t be helpful towards achieving success.

How can we plan on building world-class ‘google’ type businesses when there is no precedence for it?  It doesn’t make sense to encourage people to startup when the expectations for success are so low.

Contrast this with a plumber/accountant/solicitor/carpenter setting up a new business.  While they may be more ’self-employed’ than ‘running a business’ – it seems far more real and natural that these types of business make it.  We all know successful people in these fields.  Meanwhile I’ve been trying to build an online business for the last 10 years and I’ve met only a handful of successes (and believe me I had to dig to find them).

To encourage startups and avoid talking out of both sides of our mouths, we need to reset expectations of indigenous startups towards success.  Online businesses have a heritage in high risk funding backed ventures, but things have changed and the web has become more mature.  There is no reason that 90% of ventures should fail.  The business models that work are out there and available to be exploited.  Beyond that, even if individual ventures do not succeed, subsequent ventures by the same entrepreneur can and probably will.

I was listening to the excellent Pegram Harrison talking about Building a Business in a podcast series released by the Oxford University.  Pegram was going over how to evaluate ideas.  All very good stuff.  One throw away comment did prick my interest though …

“Unless you have the cure for cancer, there probably isn’t the need for your product you thought there was”

“I know how to cure cancer”, I thought, “maybe I should do something about that”.

Now, I am perhaps being a little dramatic for effect, but there is an opportunity for someone to literally prolong and enhance the lives of millions of people.  Lets run through some stats and see if you can guess how.

• One fifth of patients don’t fill out their prescriptions
• 125,000 American’s die annually by virtue of not taking their pills properly
• 60% of patients cannot identify their own drugs
• 1 in 4 people in nursing homes are there because they can’t figure out their own meds

Read the rest of this entry »

If we can just get 1% of our visitors to convert  …

Never have more dangerous words been written in a business plan.  It sounds plausible only because humans are mind-boggelingly bad at understanding percentages.  Even if you were a complete wingnut in school you probably still managed to get 10% in the honours math exam.  A 5% discount is nothing.  A doctor telling you that you have a 1% chance of not waking up after an op is hardly worth losing any sleep over.

However, I don’t see a lot of discussion on the chances of a 0% conversion rate in your business. Read the rest of this entry »

Fortune 500 listing excerpt

According to Wikipedia, Raytheon makes …

• 3.2 Air Traffic Control Systems
• 3.3 Radars and sensors
• 3.4 Satellite sensors
• 3.5 Communications
• 3.6 Radioactive materials detection system
• 3.7 Semiconductors
• 3.8 Missile defense systems
• 3.9 Missiles
• 3.10 Hi-tech simulators
• 3.11 Training Services and Learning Outsourcing

Coca-Cola makes bottled sugary water. Read the rest of this entry »

Although I hate the term, you could roughly describe me as a entrepreneur.  Like most entrepreneur’s my Mother despairs at the fact and really wishes I’d just get a proper job with a carreer path.  With that in mind, I thought I’d try and put one together. Read the rest of this entry »

I was talking to a pretty technical friend of mine a couple of nights ago.  He was all aglow after coming up with a killer application idea for the iphone.  This guy is smart.  He runs a successful company and has raised funding the past.  Yet, he makes the same mistake I do, you may do, and pretty much any technical person does.  He thinks

technology > design > marketing > market

in that order.  When you have a hammer, everything starts to look like a nail, and nerds love hammers.  I liked the idea of building a Spanglish button for Firefox of a Irish Twitter SMS gateway.  The idea and challenge of getting it to work is so entoxicating that you just can’t wait to jump up and get started.

We’re handicapped by the fact that we can run off and start building things.  We don’t have to pay someone else to do it.  As such, we don’t value our own time and make an honest judgement on whether it is worth the investment.

That is all fine and well if fudging around with stuff in your spare time but there is a real opportunity cost.  Rob on Software’s excellent post on the correct order to come up with opportunities

market > marketing > design > technology

While we may consider our technical ability to be an advantage, it is actually our biggest handicap.  Outsourcing might not be as much fun as coding it up yourself, but it does force you to stop and think about whether its a runner.  If you had to spend your own hard earned cash on something – would you still do it.  I’d argue that maybe you should fire yourself as CTO if you ever really want to get over your technical handicap.

There is a fatal flaw in Google analytics for anyone running an online business today.  The flaw is it only allows you to measure the amount of traffic on your site, perhaps your income, and your ad spend.  This is no big suprise, Google makes their money from your ad spend.  However, Adwords is likely to be only part or none of your marketing spend.  We actually don’t use it at all.

What Analytics does show however is that there is a lot of power in visualising your statistics.  As many bloggers will tell you, the coloured graphs help to keep the motivation up on those long cold lonely nights when you think no-one really cares.

Much the same goes for building your online cash-flow.  Sometimes it is hard to see the wood for the trees and having up to date accurate info helps to keep going through the dark times.

That is why I’ve mocked up what I think are the key metrics I’d like to see in my own dream analytics account.

At the top I’ve put outbound and inbound emails and calls.  I’ve got a hunch that these two metrics most closely predict our income in any given month.  In fact I know that getting on the phone is the single most effective thing I can do to drum up income.  On the other hand, it is an aversive task.  Clearly being able to see how calling impacts on revenue helps to get stuck in and start chatting to people. Read the rest of this entry »

I’ve been plugging away at the old Español for a couple of months now.  It is not so hard as languages go but there is still a certain amount of pointing going on while ordering dinner in a restaurant.  One of the big differences between English and Spanish are reflexive verbs.  For example, the Spanish don’t say “I like icecream”, they say “Icecream likes me”.

Me gusta helado.

Not everything is reflexive.  Only certain verbs and you just have to learn which are and which are not.   There is a list of reflexive verbs but I think one is missing.

To be worth

I’ve been playing around with different pricing points for AgTweet this week and the problem is that although we’re used to reading the price of stuff on labels, pricing is reflexive and so is value.  Its impossible for anything to be worth €10.  It can only be worth €10 to somebody. There is a broad range of people who use agtweet from students to IT geeks and the trick will be in coming up with price points for each.  In setting a price all I am hoping to do is guess the price that will be good value to enough people to make the service fly.  Its a bit of a cath-22 situation.  Price too high and too few sign up.  Price to low and you end up sponsoring the whole thing.  Decisions, decisions.

Getting whatever you want really isn’t that hard.  You just gotta stay focused while everyone else has gets bored and moves onto to something else.  Its true for property development, software development and getting good at pretty much anything.  Malcom Gladwell reckons that all it takes to become truly world class at something is to spend 10,000 hours practicing it.  Of course bugger all people can hold their attention on something for 10,000 hours.  Even swimwear models lose their appear after 10 minutes or so.

Recently I’ve been a little more distracted than normal – so in an effort to become a little more focused I started a new project.  You got it.  Don’t worry though – this one was a quickie.  I set up http://twitter.com/dailyfocus.  Its a twitter bot that simply asks “how much revenue did you add today?” at about 16:30 Irish time every day.

Its just a little reminder for myself that really all I gotta do is stay focused on day to day revenue and the rest will follow.  You can follow it too and join me and 4 other Eastern Eurpean girls looking for love.  Of course, its kind of like admitting you aren’t focused.  Then again, unless your a concert pianist, you probably are.

I saw this table in David McWilliams’, The Pope’s Children, a few years ago.  It made me sick.  There nestled in the middle of the ‘potential to generate their own income’ column was me, an IT worker.  It looks slightly dated now though.

So what has changed?

Restricted capital: Builders need capital to work with but web businesses typically don’t need a lot of financial capital to get started.

Focus on costs: It is a great time to buy that house in Dalkey but not a great time to be building one.  There is a downward pressure on prices.  Software innovation is often about pushing costs down – a popular proposition right now.

With that in mind I’m proposing a change to the table that will take place in the coming years.  Lets hope it catches on.