Stop Being the Worst Enemy of your Web Marketing

Out of many values we try to inculcate in our children is the value of keeping a promise. Keeping a commitment is more important regardless of how and in which way it comes in the way of one’s aspirations and desires. To honor a commitment, one can produce a couple of viable (not necessarily easy) options that allow them to keep up with desires and fulfill commitments as well. Unfortunately, there are some individuals who won’t accept an option.

This situation is quite similar to that faced by webmasters with their clients. Once the clients pay for recommendations to enhance Web marketing and even got recommendations, they reject just because something ‘greater’ was promised by another more ‘experienced’ web master!

Most clients would get stuck on the phrase “You do the SEO, we’ll everything else”. By everything else, they mean essentials such as social media, usability, content, conversions etc.

They WANT but WON’T!

Surprisingly, most website owners try to explain that rankings are not what they want them to be. But their aspirations and actions tend to interrupt a webmaster’s way of crafting them a holistic Web marketing campaign. Interestingly, despite these actions, website owners are shocked when they observe significant drop in rankings. This situation is awful for webmasters so much so that they wish to knock their clients with kung-fu skills.

Obviously, every business wants to increase their online exposure. However, they simply don’t focus on what is genuinely required to get there. To be precise, they become their own web marketing’s worst enemy.

Here’s a note on how NOT to be the worst enemy of your web marketing:

Believe your SEO Expert – They Know Better

Why did you hire an SEO expert in the first place? This is because you believed in them. You believed they are intelligent and equipped with skills to help you achieve your goals. So there’s no point you doubt their abilities just because they do things ‘their’ way.

Most often, website owners tend to classify what they consider their SEO knows. This is because they think that the experience of SEO and knowledge only covers a miniature division of the entire web marketing. Perhaps they perceive their SEOs simply as ‘on-page optimizers’ who focus on getting rankings. They also believe everything else can be handled (usability, conversions, social media and content strategy).

Bur if your SEO is suggesting you something else, it is better to halt and pay some attention to their advice. You’ll surely be enlightened!

SEOs don’t really get a high by offending their clients. And they don’t mean ‘insult’ when they say your in-house team is NOT intelligent. But if they tell you this repeatedly and inform you about things that gave been impacting rankings, believe them.

And if you don’t, be prepared to create a hole in your web marketing. So listen to your SEO and save your money from getting into gutter.

Don’t Reject before you Review

Prior to rejecting a specific recommendation from SEO, try and understand why that recommendation was made in the first place. Unfortunately, most of the brilliant SEO recommendations are stifled to death on some ridiculous grounds such as they don’t fit with how the website owner wants the site to appear.

Appearance may be an official reason for assassination of an SEO recommendation. There are many other reasons for SEO recommendation rejection. And for a website owner, everything seems “right”.

However, it is certainly unwise to reject something unless you understand it fully. You may be giving preference to something minor by sacrificing on a significant improvement. You must really evaluate the performance impact of recommendation. Know in detail what you’re rejecting. Rejecting recommendations and then complaining about not getting the results is silly.

Try It

There’s no chance you like a recommendation until you try it. This is precisely how TV commercials work. You need to try them before reaching a decision. There is nothing wrong with implementing SEO’s recommendations. And even if at all, your apprehensions prove right, the SEO will fix the problem.

And you never know if you’re rejecting a big triumph for your website? After all, you hired an SEO because you wished your website to be successful. So listen, understand, and act to develop a successful relationship with your SEO and a successful website marketing campaign. Good Luck!

Are You Serious Enough to Build Your Own Business Brand

The most successful brands in the world are not just typical brands which can eventually collapse; they are top brands that survive even in the midst of stormy times.  If you don’t know how to play in business, then you would probably end up watching it blow in thin smoke at some point. A company’s brand is the basic key towards getting customers’ attention and loyalty; branding must never be taken for granted.  A brand reflects what kind of commodity you are trying to present to the consumers. It tells the world what you have to offer and determines how the world will view your product or services. Here are quick guidelines to building successful brands for startups.

Straightforward Introduction

You need to grab your customers’ attention with few words. Avoid complex sentences when defining your company’s brand. People’s ability to remember the tagline of a particular product is limited.  Hence, keep it short and simple. Your brand will define who you are and it reflects the kind of company you have. As the saying goes, “simplicity is beauty” so in business, the simpler, the better. Prior to creating a brand, conduct the necessary observations to determine which tells the message you intend to pass across. One simple sentence must tell the whole story of your brand and lead people to ask about it and want to know more-make them thirsty to feel and experience your brand.

Stand Out From a Crowd

These words are most commonly used in the world of business. It is not new to established marketers, but still a lot of newbie companies fail to deliver such basic elements in branding. A company must learn unique-selling proposition which means showing to the public how your product is different from others. You need to tell them your edge against other similar products in the current market.  This is the only way to get them to give your product a consideration. For instance, if you are into sales of cars, you must tell the people what makes your car shop different from all other car shops out there. It’s all up to you on how you would make it the best among others.

Hire People and Let them Do Their Jobs

You cannot do it alone; you need people to create a strong team. You might be wondering what it does with branding. Try to think of it, if you don’t have a team that will create your brand, you’ll never come to be at the stage of what you are dreaming about. Your people are the building blocks of your company. They are hired because of their expertise and you need them. You need to put together a powerful working team that will put you on top.

Create Your Visual Identity

After formulating your brand identity, you are now ready for the next level of your branding process; creating a visual identity. It’s about time to convert your ideas into concrete forms. You might begin by creating your company website, logo and business cards. It’s something that will make people automatically think about your brand immediately they see these elements that only you possess. You need to be creative and brilliant in making your visual identity because it serves as your DNA towards other brands in the market.

Always Expect the Unexpected

Starting up a business involves a lot of time, brainstorming, planning, and formulating techniques that will make up your brand. At this level, you can’t tell exactly the direction that the business will take in the nearest future; this can cause anxiety in most entrepreneurs. This experience is normal; other entrepreneurs faced the same experience as yours so don’t be alarmed. Find yourself a break and look for someone you can talk to regarding matters that may trouble your mind. You may show them your website, logo, and ask them what they think about it so by that you are collecting ideas from other people that may help you in creating a long lasting brand.

Building a well-defined brand may take long hours of thinking and involve lots of people. Sometimes, huge amount of money will be spent, but in the end you will be making something that could change your life for a lifetime; a strong brand that will withstand any storm of competition.

 

Crowd Funding 101 – Everything A Startup Business Need To Know

Starting up a business requires capital. There are many sources from which any potential business owner can get this capital, these include crowd funding.

Crowd funding is a process where funds are collected by approaching various individuals or organizations for various purposes. Most charity campaigns are funded through crowd funding. Today, it is not only to get donations but also to fund various business activities and also educational campaigns. It is also a common way through which most travel writers fund their trips.

Crowd Funding Websites

Imagine a website where you can login and browse through a pool of courses and business ideas that lets you choose one that appeals to you best, giving a contribution towards that course. You can from time to time login in and make more contributions or check the impact of what your contribution has done. You become a member of a community that funds business ideas or charity causes.

The crowd funding websites offer the means for any individual to start up a business idea and for investors to invest without the hassle of a middle man.

The Pros and Cons of Crowd Funding

There are three main realities in crowd funding. These are;

  1. Entrepreneurs need to raise funds from their family, friends and angel investors
  2. More Investors get to partake in the financing of a business
  3. Many business ideas that would have been forgotten can finally be funded.

Each of these realities has its own high and low points

Pros of Crowd Funding

  1. Entrepreneur gets to spend their time in the running and planning of the business. Less time is spent in getting the required cash that keeps the business afloat.
  2. Makes it possible for entrepreneurs with humble beginnings to have their business ideas funded.
  3. Anybody can choose to invest in a business.  It is no longer the rich getting richer but the smart getting rich.
  4. Ideas that seem complex and difficult still get to be funded. There is no limit or boundaries to the business ideas that can be invested upon.

Cons of Crowd Funding

  1. The entrepreneur loses the opportunity of facing the prospective investor on a one-on-one basis.  He or she does not get to have a chance to convince the investors to believe in his ideas.
  2. Entrepreneurs have less feedback from the investors; hence they are unable to modify their business ideas and models to that which might attract more investors.
  3. The investors do not get to have a clear idea of the risks that are associated with the business. They are liable to making bad investments. All the necessary facts that will help the investor make a good decision or understand the concept of the business idea in details are not made available.
  4. Investors are susceptible to fraud.
  5. With all sort of ideas getting funding, both the possible and the impossible. There are more chances of investors being discouraged with the percentage of success on the low side.

The Mechanics of Crowd funding

There are four basic ways that Crowd funding works

1. Donation:  You get to donate any amount of your choice to a course you want to support, or a business idea that you fancy.

Pro: The donor feels good

Con:  The amount donated goes off without anything in return.  If the donation is to a profit company you still get to pay tax on the donated amount.

2. Pre-Sales: Here you get to pay $100 and get $100 worth of service goods in return.  These goods and service will be rendered at a later date.

Pro:  You get to support a business and still get some rewards in return.

Con:  You have to wait for months before gratification of the cash spent is realized.  There also is the risk that the service or goods might not be exactly as promised.

3. Loans:  Here you give a loan to an individual or for a cause or business. You get to be repaid when the agreed time for repayment arrives.

Pro:  There is little risk involved.  You get to invest into a local business and have a predictable interest on your money.  Better than having you cash in your bank account with no interest.

Con: Your funds is tied up without any guarantee of interest

4. Revenue Sharing: In this scenario, you invest a little amount and get equity shares or percentage of the profit made for the amount invested.

Pro: Has a potential of giving you more money than loan.

Con: The probability of success in the invested company is uncertain.

Conclusion

Crowd funding is one of the best ways that budding entrepreneurs can get the much needed funds to get the business off the ground. The investors all get a chance to contribute to a worth course that might change lives.

Crowd Funding For Startup Business-Low Risk Capital

The greatest challenge that faces every start up business is; getting enough capital to get started.  Other than the seed capital, you must also have enough resources to sustain the business.  Banks are usually the greatest source of startup capital for most business owners but this option requires collaterals, not to mention the tedious loan acquisition process. Most entrepreneurs don’t have the collaterals and the bank loan option is not appealing.

Alternatively, you may want to borrow funds from family or friends. However, this is not always advisable as the family or friend will want to exercise some control over the business. Furthermore, how much can you really collect from family and friends-unless they are all Bill Gates type?

These challenges have resulted in the popularity of crowd funding, which basically fits any type of viable business idea. This can easily be realized from various websites that mainly focus on bring together investors and potential entrepreneurs.

Crowd Funding Options For Startup Business

In crowd funding, the aim is to get donors who are interested in helping on to get started in a line of business of choice. The most amazing thing is that, only donors who are willing to help without any strings attached are encouraged to support. This means that they will neither be offered stock nor will the business owner promise them anything in return for their investment.  However, they can be offered instant rewards such as t-shirts, company mugs, and other gift items.

Basically, what the entrepreneur seeks is a network of individuals who are willing to pool in their resources in order to support an idea or effort what the entrepreneur has initiated.  Crowd funding is not limited to entrepreneurs but to other organization seeking funds for disaster relief, political campaigns, scientific research and software development.

Another option in crowd funding is to raise the initial capital needed by pre-selling the product with a discount.  The product will be delivered at a future date that can extend as far as a year.  If you have a product that you can convince the public to believe greatly in, they can pay for this product and await the delivery at a later date.  This option does not always work for all business owners; while some might get seventy percent of the funds needed, there are those that get nothing.

Difference Between Donor And Investors In Crowd Funding

There is a significant difference between the donors and investors in crowd funding.  The investor loans out his money with an intention of getting the money back and in most cases with an interest. The investor’s interest does not hinge on the success of the business.  Even if the business owner fails in his dream, he is expected to repay the investors every penny they invested into his business.  These investors are offered stock in the company and get to become stakeholders and have a say in the decisions that affect their investments.

The donors give freely and do not expect any reward for what the business owner promises them.  If the cause or business to which they have made a donation succeeds, they get a reward (usually what they have been promised). Should the business fail, the business owner does not have to pay back the funds donated to start up his business.

Platforms for Crowd funding

There are a couple of crowd funding platforms available on the internet for startups, a few are explained below;

1. Kick starter: This is an old platform that has amazing recorded success in crowd funding.  They can help to fund everything from innovative projects, art and designs to technology.  This platform has a success rate of 44% and has recorded over 70,000 projects launched on its website.

2. Indigogo: This is a large crowd funding website and among the oldest in crowd funding platforms. They have crowd funded over 30,000 projects that run across 194 countries.  The aim of Indigogo is to create a crowd funding solution that will empower all ideas and help them have funds donated easily.

3. Quirky: Quirky is a website that helps inventors to develop their product and inventions.  They help only investors to source for funds for their invention. The websites claim to have funded over 240 products. If your new business idea revolves around inventions, this is the best option for you.

An Alternative to Business Start-up Loans

There are risks involved in getting a loan to start up a business. Crowd funding should be considered first before a loan. If a loan works out, fine, but, should it fail, there is a lot of trouble.  One can find himself in insolvency, personal debt or facing bankruptcy. The risks involved in crowd funding are pretty low compared to a bank loan.

How To Write A Killer Business Plan That Works

A business plan outlines the objectives of a business and defines the major aspects related to its operations, finances and marketing, all crucial to its success. The business plan has to contain feasible, executable and measurable ideas. It is with the business plan that you will be able to apply for alternative financing, get relevant certification from relevant government authorities and manage your budget. Writing business plan that works can be a bit complex but this article seeks to break down the complexities.

Determining Business Objectives:

Identifying specific business objectives helps you in envisioning where you want your business to be in the next three, five or ten years. When you think of your objectives, you also get the opportunity to decide what kind of growth you want for your business’s future. By identifying specific objectives, business owners get clarity in terms of the path they want to take.

Other than the objectives about the business, you can be more specific and define separate sets of objectives for marketing, finance, management and operations. Aspects like the number of employees, ownership structure, revenues, market share etc. are defined in these objectives. You must appear like you really understand what you are looking for, and know what you really want to achieve

Identifying Customers and Competitors:

For a business plan to be considered as solid, it should identify the customers and competitors in the marketing plan, which is a major part of a business plan. Three of the most important customer-related questions include who the customer is, what products do these customers buy and why they buy them. No business can exist in isolation and hence, it is very important to understand the demographics of the target industry.

Establishing this will involve thorough analysis of the market and the other players, especially the well established potential competitors. The size of the competitors’ business, the customers they target and the strategy they implement are some of the factors a start up needs to take into consideration. If you are a startup trying to make your place in the market, the three ways that can help you win are cutting your costs, offering something unique and focusing on a specific group of customers.

Measurable and Realistic Estimates:

A business plan must be measurable. The timeframe you hope to accomplish specific tasks must be clearly spelt out if you are to attain them. Being over-optimistic in your business plan will only result in disappointments as your targets will not be accomplished. The same applies to profit estimates, don’t think you will make a billion with just a few thousand investments in a year.

Financial Planning:

Your business plan must be backed up by the estimates of financial statements. Three of the most common financial statements that your business plan should have are the income statement, balance sheet and the cash flow statement. These three are linked with each other and changes in one affects another statement as well as your business’s financial health. The income statement reflects your business’s financial performance and allows you to see the revenues against the expenses you incur.

Some of the highlights of an income statement include the revenues, cost of goods, operating expenses, gross profit margin, depreciation, interest expenses, taxes and net income. Considering that cash is king in business, your cash flow statement provides you very critical information in the terms of the cash you have and will need to meet your business requirement. For running the operations of a successful business, you should give close attention to cash flow statement. Some of the most important aspects covered in this statement include cash sales, total cash income, cash expenses on marketing, labor, R&D etc., taxes, and the total cash flow, which can be positive or negative.

In the balance sheet, there are three important areas, which are assets, liabilities and equity. If you are planning on obtaining funding for your startup, you will need a personal balance sheet, which is similar to a business’s balance sheet. In a balance sheet, at the top are the assets, which are further, classified into current assets. These include cash, accounts receivable, and inventory.

Next are the long-term assets, including capital and plant, investment, and misc. assets. The liabilities are divided into current and long-term as well. Current liabilities include accounts payable, accrued liabilities, and taxes. In long-term liabilities are bonds payable, mortgage payable, and notes payable. Once you have made the financial statements, you will need to write an analysis for each one. The financials should be in the form of projections

Organizational, operational and Management Planning:

This section of a business plan defines the organizational structure, the levels of management and the characteristics of employees to be hired. Every start up has unique characteristics and hence, is structured differently. The operational and supply chain aspects are important and need to be planned if you want to create a product and sell it successfully.

Conclusion

In a business plan, there are various elements, all of which are paramount for future success and business sustainability in the long-term. Objectives give you a direction and define for you what you are doing and would want to do in the future.

For a strong marketing plan, thoroughly research your potential customers and your competitors. Financials are like the pulse of your business plan and when you approach investors for funding, they will look at your financial figures and statements to determine the actual potential of your business. For the day to day operational control and management decisions, you also need an organizational and operational plan.

How to Do Market Research – The Basics

Setting up a new business and successfully penetrating the market niche is one of the trickiest endeavors that entrepreneurs have to deal with as they seek to establish a market presence. A product or service can only be useful if it meets the needs of the users better than the competing one. It must however come with the right price tag and within the reach of the buyers (doesn’t always mean cheap).

Sometimes, you really may have to research more about your competitors to get a glimpse of their operations and where they might be better than you, what attracts the customers to their products, what you can do to improve on your own products, among other factors of interests. All these will require an insight into the market that can only be guaranteed with a market research.

Why Market Research Is Important

It is unwise to plunge into a certain market without fully understanding its dynamics. Marketing research prepares a new entrant of the nature of products or services the customers prefer and how to fill the prevailing gap in niches of interest. For the established brands, you may still require marketing research to understand your customers better, whether you meet the required needs and expectations. You can also find out about loopholes in your marketing and branding campaigns. It is through research that you can choose to include more products and services to the current list of brands to broaden your market reach.

For startups, failing to conduct market research is only comparable to trying to navigate a city like New York without the aid of a map, guide or street signs. You are literary blind of your actions and where they might land you the next minute. Research opens you up to the reality and you will have to come up with the best ways to take over a market or meet the demands of your targets. The market research findings can be relied upon to craft a better business and marketing plan if you ask the right people the right questions. Any research that is done poorly can only result in uncertainty and even collapse of the business.

Effective Market Research

Just because you have conducted marketing research doesn’t mean that your troubles have ended. For proper results, you must conduct the research in a professional and acceptable way. The following factors must be considered if you are to trust your own findings. There are two main types of market research; primary and secondary research.

Primary Market Research: The main objective of primary research is to collect information by reviewing prevailing circumstances. It is here that you review the competitors, their plans and the nature of their competition. You can interview individuals either on phone or face-to-face, administer surveys and questionnaires or conduct focus group discussions.

Secondary Research: This normally involves the analysis of published data. It can be used to spot competitors, find out target segments and set benchmarks. You have to be clear on the segments as they have to meet your market geographic proximity, lifestyle, the set age groups and some behavioral characteristics. Remember, the main purpose of business is offering solution to problems faced by your targets.

A huge percentage of market research, and any other research depends on the questions that you seek answers to. In this regard, be creative and come up with questions that pertains your business, products or services. Ensure that the questionnaire is well prepared by a pro, don’t guide the respondent into answering the questions in a specific way. You can however offer them options to find out their considerations when shopping.

Your respondents must meet a number of factors. You must interview respondents from a set geographic area you target your products and/or services. They must be within a certain age bracket and of a specific lifestyle. Sex also counts, especially if you targeting specific sexes. You must understand the nature of the target respondents to effectively administer any survey, questionnaires or polls.

Common Mistakes in Market Research

Not all marketing research endeavors bear fruits mainly because of a number of reasons. To begin with, some entrepreneurs are too lazy to get to the field or conduct primary research. Such individuals choose to rely on secondary research material and use them to make their conclusions. It is not possible to draw the right brand-specific picture if you only dwell in other people’s published works. It is possible to find outdated information that may not be useful in the current market situation. The same applies to using the web for information or only interviewing people known to you. This is a sure way to end up with a biased research report.

Conclusion

The significance of marketing research doesn’t require any emphasis. It doesn’t matter whether you are a new entrant in the market or an established brand. It pays to find out what the customers think and how you can better you business.

How to Choose a Brand Consultant for Your Business

It is not easy to select the right brand consultant for your start up business. In an industry with many well established players, you require a lot of research and proper understanding of your brand expectations to hire a competent branding agency for your business. You can however look into the following tips to tap on the best branding brains capable of propelling your brand to success as expected.

Understand Your Own Expectations.

The first and most important consideration you must mirror on is your expectations from the branding agency. The mistake many entrepreneurs commit is to expect the branding agents to figure out everything out for them. As much as they are professionals, it calls for your input in determining your expectations if the work is to be delivered as expected and in time. What exactly do you want the branding agency to do for your own brand? How well do you understand the competition? Is a competing brand threatening your brand identity and you think you require to maintain the position or you intend to climb to the top and claim a larger market share? If it is a startup, do you want the branding agency to help you climb through the competition? There are so many reasons people seek the indulgence of a branding agency and the more you understand your reasons, the better and easier it will be to work with an agency.

Review the Agency’s Skill Set/Competence

After you have clearly defined the reason why you need a branding agency, the next hurdle you have to climb is to find a competent agency. Even though many branding agencies specialize in a wide array of marketing and branding areas, most of them tend to specialize in specific areas and deliver best in such niches. Some of the most common skill sets are; marketing research, formulation of marketing strategies, brand repositioning, brand valuation, brand identity promotion, among others based on the needs of the businesses. It is not enough to sift through an agency’s long client list but ask for some case studies in the areas that you are seeking their expertise. Find out the composition of the agency and where they draw most of their strength and expertise like strategists, marketing researchers, copywriters, artists or account executives.

Determine special area of specialization of the agencies as some tend to twist every task to suit their mode of operations and expertise. If the group is mainly involved in copywriting, then the chances of your requirements being twisted around copywriting are high. There is no harm in asking for specific examples or projects handled in the past for different clients. Try to find the similarity between the said assignment and your own requirements.

Experience

Extensive experience in a specific industry is paramount. This is similar to the question asked in any typical interview. Branding is similar across various industries, with a few variations. An experienced branding agency is better placed to understand your needs. This is especially critical for startups as the most important thing they need is someone who will help them scale the market. Narrow down the experience to industries that are similar to your own. If you are into pharmaceutical industry, for example, find an agency with proven successful branding experience in pharmacy, as opposed to jewelry or fashion.

Good Listener and Problem Solver

A competent branding agent must be a good listener. It is not possible to spell out all the finer details to an agent in one or a series of meetings. However, the agent must be able to put together the pieces, understand your expectations and come up with a plan that meets your requirements. Assumptions kill branding, and this is disease many branding companies suffer from. The know-it-all syndrome is more pronounced among the experienced branding agencies who assume they know what you need even before you spell out your demands. Some of them are too lazy to think and strategize afresh. All they can do is using your name in place of their last client’s.

Testimonials and References

Anyone who does a great job must be recommended for a job well done. Feel free to ask for any references from past clients. Go ahead and contact the referees to ascertain if indeed what the agency claims is true. This brings in the question of retention and the number of clients a branding agency prides of. Agencies that have been in operation for years but either have only but a few short term clients might not be the best. Agencies that retain clients are preferable since their clients believe in them.

Finally, you have to consider the fees you will be charged. Many startups may not have much to spend on branding, but you have to find value for money. Compare the costs from different agencies, consider your own budget and expectations and go for one that is promising enough.

Success Stories of Famous Internet Brands and Lessons for Young Entrepreneurs

There are many respectable individuals running successful online businesses today. You will be forgiven for assuming that things came easy on their part, maybe luck or some form of family inheritance. The truth is, very few of the successful online entrepreneurs had an easy time setting up their brands.

People like Mark Zuckerberg started the giant Facebook from his college dorm. The same story is shared by Larry Page and Sergey Brin who found Google while attending Stanford University.

Every budding entrepreneur today wants to be as famous and rich as these millionaires. That is where the problem sets in; some of these innovations were not commercial-oriented. They were driven by passion and desire to change how things were done, sometimes even out of sheer fun.

It is Not Always about the Money

Many startups fail to survive mainly because their founders are usually motivated by money. Actually, some end up copying what others are doing so that they could claim a piece of the cake. Another great innovation that has transformed how people interact on the web involves the story of Stanford University electrical engineering students David and Jerry who started the modern-day Yahoo from their “Jerry’s Guide to the World wide web” which was then just a directory that was hierarchically organized to other websites. Little did they know that they would turn this innovation, driven by passion, to not only transform the world but also rake in billions of dollars annually.

Interest-Driven

Entrepreneurs who choose to set up ventures and motivated by the money factor don’t live to watch their businesses flourish. Every person is motivated by specific interests and the best thing that one can do is to specialize in a definite area and make the best out of it. Pete Cashmore, the 25 year old Mashable founder has always been passionate about technology. His interests prompted him to set up Mashable, one of the leading technology blogs on the net today. In 2010, the young entrepreneur and blogger was named among the UK persons of the year.

Some people take interests too far. You cannot be interested and passionate about everything around you. It would have been unwise for the likes of Jerry, who were electrical engineering students, to get into the stock market. It is not because they wouldn’t have managed to rake in some profits trading in shares, but they chose to focus on areas they were comfortable in. If you love flowers, you can set up a successful online flower delivery service and ship to clients. Even bakers have taken their businesses online and you can order your next birthday cake from the safety of your room or anywhere there is an internet connection. Those who choose to run after everything eventually end up with so little, or nothing at all. The end result is desperation and blaming the unfair life.

Persistence

No one promises first-class treatment and automatic success in business. It actually doesn’t matter how many times you flop along the way, but how you take the falls. It is said that we learn from mistakes and the best thing you can do is to identify where you went wrong. Cashmore, Mashable’s founder said in a CNN interview how his fascination with technology attracted him to the web and would wake up with a computer at hand. He calls it “ridiculously persistent” and it actually paid off. With more than 12.5 million unique visitors, Mashable employs over 40 fulltime employees. The same story is shared by other great innovators and entrepreneurs on the web who defied failure and chose to pursue their interests.

Spell the Objective

Success in any online business is aggravated by the desire to achieve in a specific area of interest. You must clearly spell out your intentions long before you plunge into any business. It is obvious that the listed examples had varied interests in their innovations and interests but later transformed their ideas with time. An objective will guide your decisions as you seek to explore any sector of interest. It is a common practice for many young entrepreneurs to think big and hope to hit the jackpot within their first few months of operation. This is dangerous because they end up disappointed whenever they fail to reach set milestones. It is good to be ambitious, but it is safer being realistic.

Finally, you must be aware of the prevailing market environment. Very few of the startups on the web were founded with a lot of capital. Learn to use what you already have, you don’t have to dispose your laptop and purchase a Mac to start a graphic design business online. Mark Zuckerberg and co. didn’t have to rent an office outside college to find Facebook. They chose to work from their dorm. Today, they no longer worry about the rent. All the best as you set up the next successful business online, you can make it!

Funding a startup with friends and family

Even though many entrepreneurs rule out family and friends as crucial sources of seed capital, they are actually among the best. One of the main factors that discourage many startups from borrowing from family and friends is the fear to compromise relations, just in case things don’t work out. It is less complicated to source for capital from friends compared to other common sources like bank loans, angel investors or venture capitals. Just like any other source of capital, borrowing from friends and family also has its own pros and cons that must be well understood.

It can be tricky approaching family and friends with a business proposal about a venture you thinking of. The best way to go about this is to treat your family and friends like any other investors with some interest in the business.

There are individuals who will make it clear that they are not interested in your business, all they will require is a refund of the money loaned. In fact, this is even better as your independence will be retained; you can make key business decisions fast and focus on paying back the debts to your family and/or friends. One thing that you must bear in mind when borrowing is that, you have to strive to respect your end of the bargain or you may be forced to skip the next family reunion.

Preparation

If you are assuming that blood is thicker than water, and you can just borrow for money on during dinner or on a family reunion, you need to think twice. To be taken seriously, you must prepare yourself with a sensible business plan. Using the plan, convince the family to believe in your business idea; that is the only way you will get some checks written in your name. Work out a brief but concise executive summary about what you plan to do and how much you intend to raise to get going. You should specify the valuation, the investment amount each investor can contribute to own a specific percentage of the business and what you actually plan to do with the money; that is if you get their funding. This should be a simple procedure, but has to be handled with equal seriousness to be taken serious in the first place.

Be Specific

It doesn’t always pay to blindly thrust a proposal to individuals who cannot afford to raise the required capital. You must sort out your potential investors from individuals with sufficient income and capable of sparing some for your investment. No one will welcome the idea of investing in your business and having to survive on water and bread. Steer clear from family members who cannot afford; assuming your venture fails to pick up as expected (just being realistic) your investors must be able to live even without their projected income from your business. Accredited investors in your cycle are more favorable as the laws all over the world are somehow lenient on such individuals.

Be Honest and Realistic in your Valuation

It is always great to be optimistic when setting up a new business, dreaming about huge profits and rolling income. However, a good investor plunges into a market fully aware of the challenges that he or she is likely to encounter. Share with your family and friends not only the best-case scenario, but also the worst which can mean losing 100% of the investment. It is also possible that the investors may have to wait for up to five years to record any returns on investment. Telling lies can only cause trouble in future. It doesn’t matter how bad you need the capital, don’t raise their hopes high as they will be disappointed if they are eventually hit by the sad reality-they will point accusing fingers.

Diversify the Seed Capital Sources

Just because family or friend X is an accredited and successful investor and can invest in your business doesn’t mean that you mainly rely on him or her to raise the seed capital. It is better you diversify your borrowing from different family members and friends. One thing that you have to consider is that not everyone will be excited about your proposal. If one member lets you down, you will still be able to count on the support of another. If you encounter any individuals who are uncertain, with reservations, don’t attempt to squeeze the money from them. So long as you have laid your cards on the table, it is better if the chooses to support you in your venture.

The most important thing to consider when sourcing for funds from family and friends is to convince them to believe in your business idea. After scoring this milestone, raising the seed capital will be much easier. Actually, if your family and friends cannot believe in you, then it is unlikely that angels or other investors will.

Angel Investment Funding Vs. Venture Capital investment for Seed Capital

As opposed to the current assumption that money is scarce, there is actually more money out there in the hands of investors. Any serious entrepreneur shouldn’t have a problem accessing capital to set up a business. What is currently being experienced is nothing different from the depression in 1930s that mould more millionaires in a single era. The historical low interest rates and the volatile stock market have prompted many high net worth investors to shift their attention to diversifying their portfolios. Despite the glaring reality, many startups fail to pick up because of insufficient capital. That doesn’t mean there is none.

The availability of capital to establish any kind of business is determined by the nature of the business and the amount you are seeking. Venture capitalists, just like any other investors closely watch the performance of any business they float their money to. In this regard, they prefer to work with few serious startups with potential as opposed to many tiny ventures. Even if investing in a private equity (like yours) shows potential to grant them more value, they may choose not to for simple reasons as management and monitoring. There is always another option though; angel investors who can provide the necessary capital to get started.

Angel Investors Vs Venture Capitalists

Raising seed capital from venture capital firms is one of the best ways to raise capital for your business, but this comes with a few challenges like loss of equity in excess of 51%. Another mandatory right that they seek that may not be so attractive to the entrepreneur is the “right of sale.” Venture capitalists believe in getting their ROI as soon as possible and in most cases, may lack the patience to stand by a startup during its infancy, especially if it fails to pick up as earlier projected. In most cases, they will embrace any deal so long as they acquire their bonus for the skills invested plus their risks. They however have the money, a lot of it for that matter.

Startup entrepreneurs may find angel investors more appealing due to the diversity of this group of investors. Most angels take an equity stand and some amount of debt or both in place of their investment. To monitor their investment, they reserve a seat in your board of directors, which they also use to offer significant advice and mentorship. Some angels can even take up some active management roles of the establishment and propel it to success. It is very possible for a business to hire competent employees and grow to qualify for other sources of financing to help it grow. The entrepreneur will get access to a broad range of business networks expertise from the angel. Finally, the angel networking syndicating can help the business raise significant amount of capital with just a single angel financing deal.

All that Glitters

Venture capitalists may appear as the best source of finances for a startup. However, they may not suit a new entrepreneur trying to push the business to reasonable heights and success. They may however suit a business with an established market presence and assured returns on their investments. If you are considering an IPO or trade buy-out as exit strategies, then raising capital from venture capitalists may be the best solution in this aspect. The venture capitalists will help you properly structure your business for much bigger businesses, providing their broad and effective networks of personnel in preparation of the exit and hoping to cash in eventually.

On the other hand, entrepreneurs who want to build and stick to their businesses will find angel investors more useful. For the business to benefit both parties, the agreement should be well thought-out and reasonable. Venture capitalists normally craft agreements from their perspective, and in most cases, it is biased as their focus is to get their return on investment. On the contrary, angel investors are more flexible to work with because agreements and any deals are settled upon fairly and customized to benefit both parties.

Structured Investment from Venture Capitalists

Motivated by returns, venture capitalists bring on board structured investment, experience and managerial skills necessary to propel the business to success. This may be what many startups need, but what really matters for new entrepreneurs is the mentorship especially in the early stages of operation. When it comes to exit through a trade sale or IPO, their networks can be instrumental. The main challenge lie in their power over the business and interest to get their money back, a situation that may force the entrepreneur to go for alternatives that conflict with their ideals, dreams and beliefs.

Depending on the aspiration of the entrepreneur, angel investors may be the ideal solution since they retain the independence to run their business as they wish. You can turn to venture capitalists later after the business is stable enough and ready for expansion. It is recommended that you seek the best legal brains when dealing with venture capitalists as they have a way of drafting agreements based on their own preferences.