April 2010

Use Tax Accounting to Inform Your Planning

by sara on April 8, 2010

Looking at your tax forms for the year gives you a detailed history of your individual income. If you’re a business owner, your corporate tax return should give you the same kind of assessment of your business revenue stream, deductions or exemptions, and costs.

While it’s a favorite adage of ours here at Bplans that “Planning is not Accounting,” the two processes go hand-in-hand. Accounting, the process of looking backward into the past in great detail, should inform your planning process for the next year, giving you a better basis for making estimates about general revenue streams, expenses, and personnel needs.

If you’re not already doing Plan vs. Actual analysis at least every quarter, use this tax season as a reminder to get started.

Sara Prentice Manela
Editor

{ 0 comments }

Palo Alto Software to Award Best Written Plan at New Venture Competition This Week

by Chelle Parmele on April 7, 2010

University of Oregon’s New Venture Competition starts April 8th up in Portland, Oregon. Over its 18-year history, this International MBA business plan competition has become one of the top 3 competitions throughout the world. A result of its intense academic focus and guaranteed interaction with multiple panels of judges in a professional format, NVC is an unmatched experience for any startup venture team.

Palo Alto Software is proud to be a sponsor of this competition and will be on hand to award the Best Written Plan award to one of the many participating teams.

We wish all the teams the very best of luck!

Over its 18-year history, this International MBA business plan competition has become one of the top 3 competitions throughout the world. A result of its intense academic focus and guaranteed interaction with multiple panels of judges in a professional format, NVC is an unmatched experience for any start-up venture team. We are proud to announce that NVC was designated A Top 15 Graduate Business Plan Competition by Forbes.

{ 0 comments }

How to Lose Your Superpower

by sara on April 7, 2010

Many of us would love to be invisible from time to time, but not so much when it comes to our online presence. And yet, finding that your website is invisible is a pretty common experience for small businesses.

You built a website, you got it hosted, and maybe you even used a pretty template. That’s a great start, but if you want your website to really work for your business, you need to make sure your potential customers can find it.

Ask your customers
Ask the next ten customers you talk to whether they know you have a website. If they say no, take a look around – is your website’s URL listed on your receipts, your invoices, your business card, your stationery, your posters? Is it listed on your coupons, newspaper ads, your yellow pages listing? If you’re wondering why you should bother telling current customers about your website, consider that these are your best sources for referrals. These days, when someone you know refers you to a business, if you’re like most people, the first thing you do is take a look at the website. If your current customers don’t know you have a website, they can’t offer that information to other prospects.

Use technology
There’s a lot of free technology out there to help you target the keywords, search patterns, and related websites that your potential customers are already using. Save time, energy and money by focusing your efforts on real prospects, and not just on getting more uninterested visitors.

Google Analytics is a free tool that helps you track the traffic, most popular content, and traffic sources for every page of your website.
Google also offers a free keyword search tool that will help you pinpoint keywords related to your existing website pages.
Target pay-per-click ads to websites your potential customers are already visiting. Internet marketing doesn’t have to be hard. For example, if you’re a hardware store, your customers may also be looking at do-it-yourself websites. Think in terms of the customer’s overall needs, rather than what you sell.
Your domain name can be an asset in and of itself, either as something memorable (www.colbertnation.com capitalizes on the host’s fame and persona), or generic (www.garden.com gets a lot of traffic just with its name), or specific (www.berkshiregas.com is a website for a utility company in Berkshire County, Massachusetts).

Local search
A decade or two ago, you could be assured that any local customers looking for your type of business would turn first to the yellow pages in their printed phone book. Today, they are much more likely to turn to a search engine. If you do business directly with local customers in a physical location, local search will be important. At the very least, your website needs to include your name and some way to contact you – a physical address, a phone number, email address, hours of operation, whatever is most relevant to your customers.

John Jantsch, author of Duct Tape Marketing, has a great blog post about getting your website ready for local search. His tips include customizing the page titles with local information (“YOURFIRMNAME Kansas City’s oldest bakery”), and using local terms in your internal links (links between pages on your website). Read the full post: Is Your Website Ready for Local Search Engine Traffic?

Keep it fresh
SEO (Search Engine Optimization) is a whole art unto itself, but if you want your website to appear within the first page of results for a particular query, adding fresh content to your website will help your rankings. Put a weekly or monthly to-do on your marketing list to write a new helpful tip for your customers, and post it on your website. You can archive these on the site to increase the information available, or keep them in rotation for seasonal variation, depending on your type of business. For example, a bakery might feature a recipe of the month using seasonal ingredients, or a retail clothing store could post a fashion advice article on pairing accessories. If you own a business, you have something to say – put it on your website!

Do something unexpected
This option is not for everyone, but if you have the creativity and the relevance, try offering something unexpected.

Blenders are boring, right? Not if they’re blending an iPad.
Wondering how to spice up a body-wash commercial? With humor, of course.

This may all sound like a lot of work, but you can take it a little bit at a time. Building up your website presence is not a one-time thing, but a steady effort that should be on your marketing list every month. Take a cue from another superhero, The Green Lantern, and know that with willpower and the right tools, you can do anything.

Sara Prentice Manela
Editor

{ 1 comment }

Rice Business Plan Prize Money Hits $1 Million

by Tim Berry on April 7, 2010

As I looked up from my business plan reading chores yesterday, I saw an email from the business school at Rice University announcing that this year’s Rice Business Plan competition is setting a record with more than $1 million in prize money.

Congratulations to Brad Burke and his team for building this competition up in just a few years to the point where it’s rivaling the University of Texas’ Moot Corp, the previously uncontested Super Bowl of business plan contests. Between Moot Corp in Austin next month and the Rice contest in Houston next week, Texas wins the award as the capital of business plan contests.

I’m delighted to be a judge at both of these contests, as well as the University of Oregon New Venture Competition later this week in Portland, Oregon. I’ve already read my four plans for the Oregon contest and just finished six plans for the Rice one. I’ve read about space travel, household fly worms, deep-sea farming, and many other fascinating new businesses. I’ve seen some very good business plans and some not-so-good plans. I’m looking forward to presentations, questions and answers, and the whole process. It’s going to be fun.

Let the games begin.

(Image: istockphoto.com)

{ 0 comments }

Your Business Plan is Like a Bra

by Jay Snider on April 6, 2010

A few weeks ago we shared the success story of Camille Rose on this blog. She’s an entrepreneur who has started and run several successful businesses, and she credits her belief in the importance of a business plan, and the power of positive thinking, as keys to her success.

With a strong passion for startups in general, and specifically those started and run by women, Camille operates a consulting firm called Pink Purse Ventures. Her goal is to help other women realize the dream of business ownership. pinkpurse

On May 15, Camille will be leading a seminar called “Your Business Plan is Like a Bra… it supports your every move,” in Walnut Creek, California. According to Camille, whether you’re a startup looking for a bank loan or a business that’s already up and running but looking to grow, “business planning allows you to accomplish these goals.” One seminar participant will win a copy of Business Plan Pro, to assist them on the planning process.

For more information about Pink Purse Ventures, or to register for the seminar, check out www.pinkpurse.org.

{ 0 comments }

Finally, Official Stats Show New Jobs Added

by Tim Berry on April 2, 2010

I posted several times here on the disturbing hundreds of thousands of jobs lost per month as we fell into the great recession in late 2008 and early 2009. So it’s a relief to see that last month the economy added jobs. I got this from MSNBC, with thanks to Steve King of SmallBizLabs, who passed it on via Twitter:

The Labor Department said employers added 162,000 jobs in March, the most since the recession began. Private employers added 123,000 jobs, the most since May 2007.

The department also revised January’s job total to show a gain of 14,000, up from a previously reported loss of 26,000. February’s job numbers were also revised higher by 22,000 to show a loss of 14,000. The economy has now added jobs in three separate months since the recession began.

Sure, it’s hardly time to celebrate, with unemployment still 9.7 percent nationwide, and 15 million people out of work since the recession began in late 2007. But it’s sure a lot better than losing more than 600,000 jobs in a month not that long ago. Maybe we can think of it as a storm starting to clear, like in this picture:

(Image: Leonid Tit/Shutterstock)

{ 0 comments }

Free Tax Advice

by sara on April 1, 2010

Ah, spring, when a young company’s fancy turns to taxes…

Here in the U.S., we are only 2 weeks away from Income Tax Day (April 15th). Whether you’re an early bird who already filed, or a late bloomer still assembling receipts in shoe boxes, taxes play an important role in how you structure your business, budget for expenses, and even purchase new equipment. We’ve assembled some of our favorite Bplans posts on tax issues facing businesses, below:

Tax on Internet sales
When Your Business Partner Is Your Life Partner
Tax Planning in a Loss Situation

Wishing you many happy returns!

Sara Prentice Manela
Editor
Palo Alto Software, Inc.

{ 0 comments }

Startup Myth: Investors Want the Best Companies

by Tim Berry on April 1, 2010

As I delve into my business plan marathon season, and the angel investment group I’m in starts looking in earnest at a flock of new companies, I find myself constantly bumping into several very common myths. This is first on my list. And no, by the way, it’s not an April Fool’s Day joke.

Startups diagram The good startups for outside investment are the ones that can grow fast and get themselves acquired by a larger company, for a much higher price, so the investors can get their money back out of the deal.

Although there are exceptions, most of the good investments have to be scalable. Can you jump from selling 10 to 100 to 1,000 to 10,000 without a proportional jump in head count and overhead? Product businesses usually can. Some web service businesses can. But a lot of businesses can’t.

This is why investors don’t usually like service businesses. They tend to depend on the people more than the product. Key assets walk out the door every night. They can’t scale up.

This is why investors don’t like businesses that can finance themselves and grow forever without needing outside investment. Angel investors and venture capitalists don’t want to be long-term partners in stable businesses. They don’t want to live off dividends. They want businesses that will scale up fast and sell out to somebody else.

One scenario that founders and entrepreneurs love, but investors dread, is having a minority share in a strong independent company that can grow forever without needing big intakes of somebody else’s money. These companies might have happy owners and good financials and no incentive to sell themselves off.

One key buzzword is the exit strategy. The exit is when the investors get money back from the money they invested earlier. Exit used to be going public, meaning getting formally approved and registered to have the company’s stock available on the stock market. These days, although going public is still possible, it’s very rare. So exit means getting acquired by a bigger company.

This means that your business might be a great business but not an investment prospect. That’s quite common. I’ve been there myself, and quite happily, as we ended up bootstrapping a business that now has 40+ employees, multimillion-dollar sales and no debt, and we own it outright. But you should know it, and focus your growth financing strategies somewhere else.