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Thursday, January 29, 2009

Your Role as a CEO, what do you do


What does the CEO actually do?

The key elements that make up the CEO's responsibilities are: governance, strategy, policy, and mapping the changing world; managed in a way that supports the sustainability of the organisation.

Governance

In bringing together policy, strategy and external mapping, the CEO can ensure the company is being managed in a responsible manner appropriate to internal demands and also in line with external requirements (e.g. legislation, reporting) and best practice.

Strategy


The strategy will be derived from the vision, mission and objective for the organisation (part of the role of the Chairman), which ensures the CEO and Chairman work closely together to plan the business; drawing the various strands [finance, market and people.] into a properly developed, sequenced and interlinked format for a sound management process.

Policy

Policies are the overriding courses of action the organisation will adopt to gain maximum benefit even in changing external circumstances, and include internal codes of management. These are not set in stone and, given sufficient reason, may be subject to review and change within set parameters.

Policy guides operations, but is not a substitute; it is more an advisor to intelligent management and risk mitigation and reputation management.

The policies will be clearly articulated to allow external people acting as advisors to challenge and support management with knowledge and confidence, and by so doing help the organisation maintain its focus, even in changing circumstances.

Mapping the changing world

There is an intermediate position in management between strategy and tactics. It may be termed Intelligent Management recognising that the majority of management decisions are focused two weeks to six months ahead.

The core management and decision-making process can be significantly enhanced by regularly introducing understanding and nuances from outside the organisation and from similar organisations and markets (often by the involvement of the non-executives). By sharing this with the MD, tactics will be strengthened and operations better guided.

Supporting and being supported

The CEO links to the Chairman, supporting the vision and ensuring shareholder expectations are met in a way compliant with good governance, the other key link is to the Managing Director to ensure the actions of today are appropriate to the needs of tomorrow.

The Non-executive Directors can be very supportive by listening out for what is happening elsewhere, monitoring the continual changes in the external environment and reviewing the company's standing in the market place

Monday, January 26, 2009

Do I need a business plan


Interesting spin on the need for the buisness plan in a start up by Wil Schroter the founder and CEO of the Go BIG Network


If you’re thinking about starting a company, please don’t write a business plan. Stop, put the keyboard down, and step back. You’re wasting valuable time.

Don’t get me wrong, I’m not suggesting that you run aimlessly into the startup abyss. What I want you to avoid is the black hole of planning that most entrepreneurs get into when starting a company. They get sucked into a time warp where a formerly great idea gives way to months upon months of “thinking” about the idea instead of just making the damn thing happen.

If Nobody Buys, it’s Not a Business

The first step, before writing a plan, is to validate the concept. If nobody will ever buy your product, it’s unlikely that a business is ever going to form. Focusing on the product first, and more specifically the customer’s willingness to buy that product, is by far the most valuable time you can spend early in your business.

In addition to validating your concept, selling the product early allows you to prove some key assumptions in your plan before you begin writing it. For example, wouldn’t it be helpful to know what someone would pay for your product before you built it? You would be surprised how much information you can gather from potential customers just by asking them what they would pay for a hypothetical product. “If you build it, they will come” might have worked for Kevin Costner in the movie Field of Dreams, but it’s a formula for disaster in a startup.

The Prototype Company

Sometimes finding out early that your idea isn’t as viable as you thought is a blessing. Instead of spending months writing an elaborate business plan on a completely unproven idea, try putting together a “pre-business plan” that consists of only about five pages that quickly communicates your idea and focuses on the key assumptions that drive your business. These key assumptions are often questions like “Will people buy the product as I’ve defined it?”, or “what will they pay?”, or “how much would it cost me to sell this product?”.

Imagine that the first few months of your business are really more like a great big “prototype company”. Focusing strictly on the sale of the product and proving your assumptions, even on a small scale, will allow you to write a far more comprehensive and viable business plan when you are ready to formalize your thoughts. Additionally, you will be able to make much more accurate forecasts on the business when you get a sense for what it really takes to market, sell and deliver the product.

Your Business Plan is Not an Application for Capital

It’s a common misconception that investors want to see a business plan before they will consider investing in a concept. That’s not entirely true. What investors want to see is that you can demonstrate your ability to sell the product to paying customers. Ask anyone (even yourself) who you would rather invest in – a startup company that is making money without a plan or a business plan that isn’t making any money? Writing long, elaborate papers might have impressed your instructors back in college but it won’t win you any points with investors. They want results, not ideas.

Keep the Plan Simple (and listen!)

Despite what you may have heard, most of the best business plans are as simple as possible. It’s far more important for you to demonstrate that you can solve one market need incredibly well than being able to show you’ve thought of every possible market niche and have included it in your plan. Think quality over quantity.

The process of writing your business plan isn’t to show off how much you know about a concept. The most important aspect of writing your plan is to become a voracious listener. Listen to what your potential customers are telling you they want in a product. Listen to what they are not getting from the existing products. Listen to what investors are looking for in the companies they put money into. Your business plan should read more like a record of all the valuable information you have heard, presented in a meaningful way that makes the case for your company’s potential success.

Put Down Your Pen and Pick Up the Phone

You’re much better served to do your business planning by picking up the phone and asking customers to buy than you are in writing an elaborate plan. In fact, the more you speak to people about how they will respond to your idea the more likely you will write a much different plan that is based on real world findings.

Thursday, January 22, 2009

How do you qualify a sales lead


Qualify a sales lead is something that an early stage company can have difficulty in doing accurately, in the early days, you may not be able to hire a good Marketing / Sales person, and you are doing it by yourself, I picked this article up may help you in those early days and beyond. This is one of the most important things a company needs to learn to do and do it well, there survial is based apon there sales forecast and there execution on it.





By By M. H. "Mac" McIntosh, CBC ( http://www.sales-lead-experts.com/ )

You may think you know what qualified sales leads are, but if you asked your salespeople and corporate executives, would they have the same definition? Probably not.
If qualified lead generation in a business-to-business marketing-for-leads program is to succeed, marketing, sales and corporate management need to share a unified definition of qualified sales leads. If you all agree from the start on what a qualified lead is, the marketing team stands a better chance of generating leads that will be valuable to the salespeople.
It's important to confirm the qualified-leads definition, in writing, with all parties. This definition is different for each company, so you must do some work to define the meaning of qualified sales leads at your company.
Characteristics of a qualified sales lead
General questions that need to be answered in order to determine that a lead is qualified include the following:
Does the prospect have a need or an application for your product or service?
What is the prospect's role in the decision-making process?
What is the prospect's timing for purchase or implementation?
What is the status of the prospect's budget?
What is the size of the opportunity?


However, additional or more detailed criteria may be needed to define qualified leads at some companies. This starts with a company contact who admits to a business problem, either latently or directly, that could be solved by a product and/or service you are selling. Here are a couple of examples of problems/solutions to use in qualified lead generation.


Problem: The company's current disparate computer systems require employees to perform redundant data entry, which wastes their time and reduces efficiency. Solution: Your software product would enable single data entry.
Problem: The company's managers suspect it is paying too much for unused software licenses, but they don't know for sure. Solution: Your license management software tracks all software on a network so companies can determine what software is licensed and being used or not
In addition to having a business problem that your company's products or services can solve, truly qualified leads must meet other conditions:



They must have an established project in play. This is apparent if a task force has already been appointed to solve the problem or, for a small company, if the inquirer's boss asked him or her to find a solution or make a recommendation.
They already have or believe they can find the money to buy a solution to the problem. Or they are in the process of developing a budget.
They plan to purchase within a reasonable amount of time.
They have the power to get you in front of the appropriate final decision maker(s) when the time is right.
Create a sales lead glossary
In addition to defining a qualified lead, consider creating a glossary of standard terms defining what your company considers to be a "suspect," a "prospect," an "inquiry," a "response," a "qualified sales lead," a "qualified suspect," a "qualified prospect" and so forth.
Again, sales, marketing and management need to agree on the definition of each term, as this will help you avoid confusion later during qualified lead generation.


Use a lead scoring approach
As you develop your lead qualification criteria, keep in mind that lead scoring can be an effective method of determining which leads are qualified and ready for sales follow up.
To score a lead, assign points based on how well the prospect meets each of your lead-qualification criteria. Consider the following example:
Funding, ready to go 5 points
Budget in formulation 3 points
No budget for project 0 points
Is the decision maker 5 points
Is the recommender 3 points
Is an influencer 1 points
Has a clear need for product 5 points
Plans to buy within six months 5 points
Plans to buy in one year or later 1 point
Plans to buy $50,000 of product 5 points
Plans to buy less than $100 of product 0 points


To score the lead, add up all the points. Then, for example, those with 20 or more points are determined to be qualified sales leads; you should send them to your sales force.
Teamwork drives sales opportunities
Meet with your peers in marketing, your company's salespeople and your senior managers to learn about their definition of qualified sales leads. Use the lead-qualification criteria and scoring examples mentioned earlier in this article as discussion starters. Distill what you learn into a draft definition and run it by all the participants for further discussion and approval. If there is still disagreement, let your company's senior sales management make the final decision.
With marketing, sales and management all speaking the same language vis-à-vis qualified sales leads, everyone can pull together to target and nurture the most promising leads. And boost sales and revenue as the result.









Hope it helps, drop in on Mac's site

Friday, January 16, 2009

Thursday, January 15, 2009

ENTERPRISE FINANCE GUARANTEE SCHEME

Free lunch? - What does UK government funding mean to startups?
By Nick Halstead, CEO and founder of fav.or.it


As I am in the midst of raising another round of funding for fav.or.it I wanted to cover some of my thoughts on the government’s recent announcement of further funding for business that is meant to help SME’s survive through the credit crunch. The question is: is there real substance to any of this, or is it just a lot of hot air?
ENTERPRISE FINANCE GUARANTEE SCHEME
This is just a fancy new name for what you probably know as the SFLG (Small Firm Loan Guarantee) - this is a scheme in which the government guarantees 75% of a loan with the rest covered by the banks.
A year ago this allowed loans of up to £100,000 - which was then increased to £250,000. It was something you fell back on if the bank turned you down for a normal loan (in fact it was a requirement that you first applied for a normal loan). I have previously raised a SFLG (over 2 years ago) and found the process reasonably painless except for the fact they take a debenture against your Intellectual Property.
The problem though is that since the beginning of the credit crunch the Banks have not been lending. I inquired to a friendly senior figure in HBOS about 4 months ago and was told not to even bother. I also contacted a few other people in the know within SEEDA and the answer was the same, no lending.
So when I heard about the new initiatives I was curious to find why anything would have changed. Well the statement from the UK GOV declares ‘This scheme will support up to £1.3bn of new lending by banks.’ However, there is one BIG problem, the banks still do not want to lend. I heard today from someone who was at a senior meeting of the “Big Four” banks (that we as tax payers now own) that they declared that in no way was there any going be any lending via SFLG.
My Advice: Ask your bank manager, but when he laughs at you don’t be surprised.
CAPITAL FOR ENTERPRISE FUND
This used to be a fund created by the government that was bid for by various private venture funds who would then invest it. The scheme was originally setup to fill ‘the equity gap’ that being investment between £250,000 and £2million - an area that traditionally is not covered by Angels or VC’s. The fund is re-invested by companies such as Seraphim Captial and Oxford Technology. Both of these in general only deal only with companies that are already generating good revenue.
The confusing part is that the new announcement seems to have converted this equity based funding model into a ‘debt to equity fund’ this may be due to the fact that not enough of the fund has been spent, and or they see it better used to convert bad debt.
My Advice: If you are already generating cash then talk to them, but if you are in that position then the VC’s (such as Balderton) are already in the prowl for good deals.
REGIONAL DEVELOPMENT AGENCIES
The last minor announcement was that a further £25m was going to be invested through the RDA’s. This in theory is the best news for startups as RDA’s such as SEEDA are slightly better at distributing money out via other agencies. One which I have dealt with at length is Finance South East - they have a range of funding models from equity based matching funds (up to £250,000), debt based accelerators (up to £100,000) and also a few other small funds for very early stage ventures.
My Advice: For startups at pre-revenue stage there are a number of good options, but be prepared for a 4-5 month process + a lot of paperwork.
NESTA
Lastly let me just make a scathing attack on NESTA who in theory cover ‘Science, Technology and the Arts’ but in fact would rather not touch Technology with a 9 foot investment stick. I was clearly told that “We do not invest in anything web 2.0 at the moment.” - So feel free to go waste time talking to them, but I would warn against it.
My Advice: Tell them to stick it where the sun don’t shine.



This is not my opinion, but I do agree with most of the comments made by Nick, but there is cash to be had..so see what they can do for you..it is your choice to take it or not


Gordon