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Business opportunity #2

January 27, 2010

(1) Passion

I describe my passions as deal making, leading, managing, motivating, team building, boating, jogging, biking, reading, politics, finance, BC’s southern Gulf Islands, business and Vancouver.

My passions as described by my personal board of directors: “big picture”, politics, drive my own vision (not someone else’s), control, client facing, see things work, instinct, not bigco, managing.

  • Deal making: 2
  • Leading: 3
  • Managing: 3
  • Motivating: 3
  • Team building: 3
  • Boating, jogging, biking, reading, politics, finance: 3
  • BC’s Southern Gulf Islands: 3
  • Business: 2
  • Vancouver: 3
  • Big picture: 3
  • Drive my own vision: 3
  • Control: 2
  • Client facing: 3
  • See things work: 2
  • Instinct: 3
  • Not bigco: 3

This opportunity allows me to directly pursue one of my personal passions.  It gets me immersed into something I love and I can see the track to growth.  However, its growth is probably limited.  The income potential is lower in this and the business could very well become a lifestyle, which isn’t really what I’m looking for.

(2) Skill

As identified by my personal board of directors: people, strategy, advising, relationships, goal driven, process oriented, structured, execution, sales, presentation and verbal skills.

  • People: 3
  • Strategy: 3
  • Advising: 1
  • Relationships: 3
  • Goal driven: 3
  • Process oriented: 3
  • Structured: 3
  • Execution: 3
  • Sales: 3
  • Presentation/communication: 2
  • Verbal: 1

I have no doubt that I could execute on this business plan and do a great job.  I’m quite confident that I could build this company into a market leader over the course of time.  But, like all opportunities, it has its drawbacks.  I wouldn’t be totally free to drive my own vision because I’m looking at doing it with a partner.

(3) Economic engine.

This opportunity has the potential to become a bit of a lifestyle business by generating a nice income, but not much more than that.  I’m not a believer in building up a company for the purpose of selling it, rather I think one should build a business to be the best in its market.  The rest takes care of itself.  I get concerned that after taking a financial risk and building this business up that the equity wouldn’t be worth very much.  When I look at other businesses in this space that seems to be the trend.  Now, I could always break free of that but the tides would be running against me.

  • Economic prospects: 2
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Business opportunity #1

January 17, 2010

As I go through the process of considering my next business (this has been a long process, I sold my last business nine years ago) I find myself thinking long and hard about what I want to do, what I can do and what will provide a return.

There are three businesses that I’m currently considering.  The filter I’m using to assess all three is based on Jim Collins’ Hedgehog.

(1) What do I want to do (passion).

(2) What am I good at (skill).

(3) What can provide me with an adequate return (economic engine).

Essentially, he argues that great businesses only focus on those opportunities where passion, skill and ability to generate profits cross.  I think the Hedgehog can be used for individuals too.

I’m going to post a three part series that run through an analysis of each of these opportunities framed using the Hedgehog (1 not at all, 3 totally).  I’m not yet at a stage where I want to publicly broadcast details on these opportunities, but if you’re interested in learning more then send me a message.  I’m more than happy to talk offline.

Opportunity S

(1) Passion

I describe my passions as deal making, leading, managing, motivating, team building, boating, jogging, biking, reading, politics, finance, BC’s southern Gulf Islands, business and Vancouver.

My passions as described by my personal board of directors: “big picture”, politics, drive my own vision (not someone else’s), control, client facing, see things work, instinct, not bigco, managing.

  • Deal making: 1
  • Leading: 3
  • Managing: 3
  • Motivating: 3
  • Team building: 3
  • Boating, jogging, biking, reading, politics, finance: 1
  • BC’s Southern Gulf Islands: 1
  • Business: 3
  • Vancouver: 3
  • Big picture: 3
  • Drive my own vision: 3
  • Control: 3
  • Client facing: 2
  • See things work: 2
  • Instinct: 3
  • Not bigco: 3

This opportunity would certainly provide me with an opportunity to once again lead and build a team, drive my own vision, follow my instinct (I think there’s an opportunity here) and make deals with suppliers.  If successful it would provide me with time to pursue the “other” passions – boating etc.

(2) Skill

As identified by my personal board of directors: people, strategy, advising, relationships, goal driven, process oriented, structured, execution, sales, presentation and verbal skills.

  • People: 2
  • Strategy: 3
  • Advising: 1
  • Relationships: 1
  • Goal driven: 3
  • Process oriented: 3
  • Structured: 3
  • Execution: 3
  • Sales: 2
  • Presentation/communication: 1
  • Verbal: 1

(3) Economic engine.

This opportunity is an online store that is very focused on a single market niche.  The market is large, the margins are good.  If volume were achieved then the business would be very profitable.  There is competition and I don’t see a “game changing” component.  It would add convenience and provide an easy place for consumers to go for esoteric versions of the product.

Really profitable online opportunities are game changing.  For example, Amazon changed the entire way we buy books and has become a great company.  This opportunity doesn’t have that game changing component, so can it be really lucrative?

  • Economic prospects: 2

Fifteen years ago my dad sent me to a long time client of his for some career and life advice.  I had just graduated from university and was trying to figure out what to do with my life.

I remember that day and that advice vividly.  I owned a white Volkswagen Jetta, was wearing a green golf shirt, khaki pants, boat shoes and met in his office in Washington state.  His green Mercedes S500 was in his parking lot and he referred to it as being “ugly as sin, but drives like a dream.”

We spent two hours together and I remember one piece of advice as though it was delivered to me only a few minutes ago.  It was, “do what you love and all else will follow.”

I haven’t always followed this advice, but when I have I’ve been happier, more successful and have just felt normal.

I came across this video of Steve Jobs delivering the commencement address to a Stanford graduating class.  One of his messages, “follow your heart, it knows what you want to become”, reminded me of my mentor’s 1994 lesson.

See the video below.  It’s well worth fifteen minutes.

Entrepreneurs take risks and then organize and manage new enterprises (often businesses).  Regular readers of my blog know that I have been looking for my next business opportunity for several years.  I haven’t found it yet (but stay tuned) so in the interim I have to live vicariously through my friends and acquaintances.

One such person is a Vancouver entrepreneur named Robert Zalaudek.  I’ve known Robert since his undergraduate university days when he owned various coin operated vending machines.  Recently, after practicing as a professional technology recruiter, Robert took a risk, left his firm and followed his passion (read Hedgehog entry by clicking here) by starting a company to distribute the European designed and manufactured Sit Fit.

I’ve known Robert a long time and if I were to list his passions (not including family and friends) I would include tennis, general physical fitness and wine.  This evolving story is a true one in entrepreneurship.  Robert decided he wanted to start a business, sought out a product, defined a business model, approached the manufacturer (in Germany, no less), proposed various structures and went through many rounds of discussions before landing on his current deal.  If memory serves me correctly, then establishing his business has taken about six months.

This is just the beginning for Robert and Build Your Core.  I have no doubt that he is going to have great business success.  Check out Robert’s company website at www.buildyourcore.com and, even better, buy his core building Sit Fit product.  I’m sitting on one now and can attest to its effectiveness!

Lessons learned

June 24, 2009

I have started two businesses, a large restaurant and a computer services firm.  The first was successful and the second wasn’t.  Both were tremendously challenging.

While I learned a lot from each business, most of what I learned came from my failed business.  Here’s a laundry list of those learnings:

  • Manage cash flow
  • Pick great people
  • The buck stops with me
  • Most people want to be led
  • Not everone wants to be an owner
  • It doesn’t need to be perfect
  • Negotiate well
  • There are dishonest people out there, my gut is right most of the time
  • Never know what will happen if you ask
  • Find effective and interested mentors
  • Do what you love and the money will follow
  • You can make money doing anything
  • Make a plan
  • Financial projections are just that, projections
  • Understand financial statements
  • Hire slowly, fire quickly
  • Competition is good
  • A day spent on competitive research is not a day wasted
  • Don’t lose focus on your own business
  • Being scared is okay
  • Hire a good accountant
  • Find a trusted advisor
  • Treat critical feedback as a gift
  • Persistence pays
  • An “A” team is more important than an “A” idea
  • Ideas are meaningless if you can’t execute
  • You don’t have to have a professional skill
  • Entrepreneurship is a lot of work….and a lot of fun
  • People are self interested
  • It is not that hard to be exceptional
  • Make raving fans out of your customers – they’ll sell you
  • Help your staff accomplish their personal and professional goals
  • Have wide open lines of communication
  • It’s okay to tell your team how the company is doing
  • Communicate early, often and honestly
  • It’s okay to ask for help

This list is only a very partial list.  Had I known some of these things before I started my second business, I’m convinced it would have been a successful company (in fact, had I known these things, particularly the “do what you love” piece, I would never have started my second company).

As I go through the process of finding my next opportunity, I keep these things top of mind.  In fact, I’ve turned down at least two business opportunities as a direct result of some of these learnings.  Now the trick is to make sure I don’t miss the “right” opportunity because of this learning!