In the words of Frank the Tank (Will Ferrell) in the movie Old School when he decides to go streaking through town, when it comes to being an entrepreneur or creating a start up it seems today ‘everybody is doing it’. There are countless Government incentives and funding rounds available, and the market for venture capital in Australia has certainly expanded and matured.
The entrepreneur in me looks fondly on these developments, but given I started my entrepreneurial race years ago, I'm not eligible for much of the startup funds and instead keep cantering along like a well trained race horse. But I’d be lying if I said I didn’t sometimes feel like breaking free from the bridle and galloping off in a new direction to try some new entrepreneurial stuff – partnerships, new services, collaborations, acquisitions – whatever that may be. And sometimes that’s exactly what myself and my business partner Katrina Lees do. Though we always stay on track at the same course where possible too. Confused? Let me explain...
If you have an ear, eyes and nose for innovation and entrepreneurship, and if you’ve been in the game long enough and know enough people, there’s never any shortage of opportunities to pursue.
So if you have serial entrepreneur tendencies, how do you satiate your entrepreneurial appetite from inside a company framework? And not only that, but as the leader of an organisation, encourage a culture of entrepreneurialism - pushing boundaries, staying competitive, and dare I say the most overused word of them all (and often misunderstood) – innovate. Well here’s a few options I’ve come up with for you based on my own experiences...
1. Entrepreneur in ResidenceI’ve been watching with great interest the advent of the ‘Entrepreneur in Residence’ in the last few years. An Entrepreneur in Residence (EIR) is an idea which dates back to the 90s and which is a position in a business that is usually temporary and not formal. An institution brings in an entrepreneur, who is sometimes in the process of starting or expanding his/her new company, or other times is quite accomplished to introduce new ideas and innovation into a company.
Many big companies, like Google Ventures, Target and Dell, and venture capital funds like Accel Partners and Battery Ventures, are investing in entrepreneurs-in-residence which can influence how businesses scale and expand their offerings.
Most EIR agreements are for about a year, but vary depending on the firm and the individual. Some are well structured while others are less formal.
Bringing an EIR into your organisation is a great way to try innovation and entrepreneurship on for size. They become your dedicated innovation and entrepreneurial advocate, who, if they are the right fit, could provide some positive influence, or at the most make a massive impact on your organisation.
2. Review and create new product lines or business unit, not an entire new business and know where it fits in the Boston matrixWe have always offered quite a few services which we consider as product lines, and have generally used the Boston matrix – a chart that was created by Bruce D. Henderson for the Boston Consulting Group in 1970 to help corporations to analyze their business units or product lines.
Product lines or business units basically break down into one of the following:
Cash cows - where a unit typically generates regular cash to maintain the business. They are regarded as staid and boring, yet corporations value owning them due to their cash generating qualities. They are to be "milked" continuously with as little investment as possible.
Dogs are units which are basically not performing. Dogs, it is thought, should be stopped, sold off or dramatically shaken up if they are to not be ‘put down’.
Question marks (also known as problem children - because we all know what they are!) are business units which have the potential to improve and become stars (next point), and eventually cash cows but equally if not well managed could degenerate into. Question marks must be analyzed carefully in order to determine whether they are worth the investment required to grow market share.
Rising Stars are business units with high potential in a fast growing industry.
Obviously a mixture of cash cows and rising stars are desirable to have as your main business units, but it is quite natural to have some dogs and question marks along the way. The important thing is that you stop and consider your product lines or business units, and which category they fit into on a periodic basis. Just because you had a cash cow, doesn’t mean you can milk it forever.
In April 2015, after we had great success with a crowdfunding campaign which saw a 21 year old approach us hoping to make $20,000 and we helped him achieve $200,000 in a month, we saw an opportunity to create a business unit which seemed to be a rising star by adding on crowdfunding marketing. Because this campaign was so successful, a ton of enquiries followed, so we proactively established links with major crowdfunding platforms including Indiegogo, Pozible, and ReadyFundGo.
Rather than set up a new business to offer this service, we added crowdfunding as a new product line, set some targets, and strategies to achieve them, and have been monitoring them month by month ever since.
How’s that going for us? Well in many respects great. We’ve done several successful campaigns, rank well on Google for the service, and continue to field a strong flow of enquiries of people wanting help on this front.
But the downside of being a pioneer with a new offering like this, is that there is no manual, so you are constantly testing and measuring, writing procedures and tracking time to work out how to create efficiencies and greater results next time around.
Certainly associating with so many entrepreneurs in the crowdfunding space with multiple projects crossing your desk in any given week, you satiate the entrepreneurial desires somewhat. But sometimes expectations are unrealistically high, and, well, living vicariously through others isn’t always quite enough either.
3. Test it out in LabsOur latest attempt at weaving innovation into our organisation and at the same time attempt to satiate our entrepreneurial desires is taking a page out of Google Labs. Though it’s no longer in operation, Google Labs was a page created by Google to demonstrate and test new projects. Google describes Google Labs as "a playground where our more adventurous users can play around with prototypes of some of our wild and crazy ideas and offer feedback directly to the engineers who developed them."
This makes great sense to us, so right now we’re establishing a new division in our business (not just a product line) to test new projects. And interestingly, some of these do not rely on the traditional methods of running an agency. Instead, we’re taking matters into our own hands and mobilising some online businesses, with different go to market and profit chasing strategies involved, which don’t involve servicing clients, but rather applying our smarts to online businesses and adding value to them, with a view to trading in them.
And we’re encouraging our team to bring forward more ideas which we could test in our own ‘Labs’ division (we’d love a more original name by the name if anyone has any ideas let us know!)
4. Broker joint ventures and partnershipsWe all only have 24 hours in a day and 7 days a week, and as passionate as you might be about your business, nobody wants to work all the time. Leveraging your time to innovate and satiate your entrepreneurial appetite through joint ventures and partnerships is also therefore a really good idea.
But clearly it’s about finding the RIGHT joint ventures and partners to get involved in. We’re in the privileged position to be approached about doing things like this all the time. We have to get really selective about who we choose to work with. Some of our qualifying criteria includes:
· Is the product unique. A world first? Ground breaking? Solving a problem with mass appeal?
· Would we invest in it ourselves as customers?
· Is it sexy? Can we market it?
· What is the potential partner like – can we work with them? Dynamic? Driven etc? Is there a story about them esp if PR component?
· Are they organised – what have they got ready already? Are they prepared to roll their sleeves up and do work (because it aint all going to be on us!).
· Are they available enough to do the work i.e. working full time? Parent? etc.
· What experience have they got in doing stuff like this? Running businesses etc?
· Are we clear on each others expectations i.e. what each partner will do in the arrangement and has this been documented, discussed and agreed on?
· Is the timing right for us - what else do we have going on at the moment?
· Do we want to work on this?
Next time you consider doing a JV or partnership arrangement on anything, feel free to lean on our list or tell us what’s on yours so we can consider adding to it!
At the end of the day, it’s really a cultural thing
As Startup Daily aptly described in an article earlier this year, when it comes to weaving innovation into your workplace and satiating your entrepreneurial appetite at the same time:
‘It’s not enough to put posters on the wall and make aspiration proclamations for “collaborative cultures” and “disruptive innovation.” Cultural change doesn’t hang on the walls – it lives in the company strategy, the structure and commitment to trying new things, to the individual decisions each employee makes, in how he or she talks about work, how he or she feels performing it and what drives him or her forward.’
Whether you decide to bring in an EIR, create a new product line or business unit, dedicate an entire division to testing out stuff, at the end of the day, you still need to simply have a organisational commitment to weaving innovation and entrepreneurship into your culture which could mean many things, but will likely mean giving this topic air time on a regular basis at team meetings, strategic planning and more, and recruiting and retaining people who are agile enough and brave enough to be part of the journey. Where there is innovation there is speed bumps. But there can also be great satisfaction.
Encourage contribution, even on the hard stuff. Allow thinking space. Encourage the non-entrepreneurially inclined. Encourage risk taking.
And most of all, have fun doing it!