The E-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It
Blue Ocean Strategy: How To Create Uncontested Market Space And Make The Competition Irrelevant
The Know-It-All: One Man’s Humble Quest to Become the Smartest Person in the World
In the blogosphere, there is a large hue and cry about the death of newspapers. And it’s true. Newspapers are losing advertisers, subscribers and relevance. There are a lot of reasons for this.
- It used to be that only the newspapers had the printing press. Therefore they owned the news manufacturing (reporting) and distribution (printing and delivering) of the news. The advertisers were looking to get to the subscribers and this was the only way to do so on a local basis.
- Journalists were proud of their independence and their political slants. They were proud of the investigative reporting and in-depth stories that were difficult to tell in other formats. People wanted and were willing to pay for the news. Because this was the way that the stories were told, people did not even look outside the news box for other alternatives. Publishers made fortunes — ever been to San Simeon, home of William Randolph Hearst?
- First to take some of the local advertising dollar from the newspaper was local cable tv and radio. Now the options of advertisers become a little more open. You could focus your advertisement more closely geographically, ethnically, demographically and politically, in ways that you could not with newspapers.
- Then the internet was born. The internet changed all of the rules. Craigslist was the first to take on a profitable piece of newspaper turf, classified advertising. Then CareerBuilder and Monster.com took on the employment section. Coupons became available on-line. Blogs on every conceivable (and some not conceivable) topics were started by people with a passion. There was more variety, because more people were adding to the mix. And all of it (well, most of it anyway) was free. The newspapers had nothing to counter these new offerings.
- So, the papers tried to find alternative ways to bring in revenue and lower costs. They reduced foreign bureaus and they furloughed editors and reporters. The big guys started to syndicate their reporting to smaller papers in hopes of getting some revenue boost. Now, the same NY Times story was being reprinted in the Orlando Sun or the Topeka Capital-Journal. The big papers put in paywalls, where a consumer would have to pay a subscription fee to view their content, but since folks in Topeka or Orlando already saw the content and it was available free, people had an easy way to Google their way to the same content that was behind the paywall.
- Then Google came up with Google News and culled news sources from around the globe and presented the news to viewers for free. Newspapers no longer had any loyalty from their readers when you could read multiple articles from different viewpoints on the same topic with only a click. Of course, the newspapers blamed Google for taking away their business, but in reality, they had not changed their business model in over 100 years and had not kept up with the changes in their customer base. And their old consumers were loving the new world with more choice and more information, in a more usable format.
Folks like Jeff Jarvis think about the news world all of the time and are trying to figure out what the next big thing is. He is running a project at City University of New York’s Graduate School of Journalism that explores new business models for news. But not all of the good ideas come out of New York.
Here in Chicago, a couple of friends of mine, Jeff Leitner and Jim Jacoby at Manifest Digital have been working on what could be a game changer for the news business — or rather, the vacuum created by failing news businesses. Jeff and Jim are teaming up with another Chicago company to produce something they call a private label news service.
In short, they create legitimate news outlets for their clients — professional reporters, professional editors, straight news. Watch this — it’s a minute and a half and pretty damn entertaining.
The point of this is that one of the things that newspapers have always provided is a third party objective view of a story. The best news stories are not a press release sent out by companies, but real stories reported by real reporters. For example, the US Chamber of Commerce was interested in delivering news about the state attorneys general, so they created Legal News Line. Real news on a regular basis reported by credentialed journalists through their own news portal, but also delivered to places like Google News.
I’m not sure that I believe that this is the future of news, but it is darn interesting.
Entrepreneurship Blogger: I just found a new entrepreneurship resource that I need to share. Mark Suster writes Both Sides of The Table as an entrepreneur turned VC. His writing is clear and he writes about things that all entrepreneurs need to read. I think I have “starred” his posts 4 or 5 times in the last several weeks as clear thinking about topics I care about.
Reminders: Do you sometimes send an email request out to someone and then forget about the fact that you are expecting something in return? Then a deadline passes and you say, “Where in the heck is that response from so and so?”. There is a simple new tool out there for free that will help you. It is called FollowUpThen. To use it is simple. Just add an email address in the form email@example.com to your cc: or bcc: list and the site will send a nicely formatted email after that time period has passed. If you add it to the cc: list, then if the recipient doesn’t reply all with the answer to your request, FollowUpThen will send both you and the recipient the reminder email. If you add it to the bcc: list, the reminder will be sent only to the originator of the email. The xdays can be any number of days, weeks, months, years or hours. The tool seems to me to be an elegant solution to a common problem.
Legal Aid: If there is one thing in this world that I love is a business success story. There are a lot of things that make me crazy, but one of them is lawyers who go the extra mile to make tons of money at someone else’s expense, damn the particular merits of a case. The latest Chicago entrepreneurial success story is Groupon. If you have never heard about them, they create a deal a day for each city that they are in (now up to well over 50 cities). If a minimum number of people sign up for the deal, it is a go. The deals are usually pretty great — normally 50% or more off of some service. Each day you get this little present in your email box describing the deal — a manicure, massage, dinner, auto show tickets or Cubs rooftop box are just some examples. I have used their service and absolutely love it. Its free to sign up and just choose each day whether a specific deal will work for you. Their customer service policies are unbelievable. If you have a problem, normally they will just refund your purchase price, but they have been known to work with their vendors to make alternative dates available or accept expired certificates. Nothing but good things.
So, what’s the problem? Well, a local law firm just filed a class action lawsuit claiming that Groupon systematically deceives their customers. Best retort I have seen in a while — Groupon is declaring a class action lawsuit against itself. Let them know if and how you were deceived and they will make it right. If only there were some procedural way to have a law firm punished, if found to be bringing frivolous lawsuits. This one certainly sounds frivolous to me.
Innovation: Allan Young writes a great article on the virtues of the Pareto Principle as it relates to your career. You probably remember the Pareto Principle as the 80-20 rule. In this article he also talks about the venture capitalist’s issue with the Pareto Principle.
Chicago: I have been thinking about the Chicago Entrepreneurial environment lately for a new idea and one of the big issues is that we, here in Chicago, have this notion that the financing folks (angels, VC, private equity) are socially conditioned to be risk averse and thus new start-ups don’t start or prosper here at the same rate as on the coasts. This post by Micah titled competitive cooperation, after you get past his illness description, talks about how the tech community in Boulder works to support each other, while striving for personal success. It would be great to get some of this thinking going in Chicago.
Entrepreneurship: For some reason, I am in a teaching mood today. Here is a long post by Mark Cuban about success and motivation.
Big Picture: As I get older, I find that the “rules” that I once were taught are not hard and fast anymore. In fact, some of the ideas about demographics have changed significantly even since the beginning of this century. The Woodrow Wilson International Center for Scholars has an engaging study of world demographics that puts some of those old rules to the test.
Big Picture: Sometimes it is hard to comprehend the meanings of million, billion and trillion. Terence Tao has taken the US Federal Budget and rescaled it to the approximate scale of the average family in the US. This helps to understand how much money is being spent on which items.
Entrepreneurship: Jim Stoynoff has written a good blog post on the ways that small businesses can work better with bankers. A lot of it is common sense, but communication ranks high on this list.
Chicago: Woo Hoo! Fast Company has named Chicago its U.S. City of the Year.
Innovation: When entrepreneurs get together in Chicago, a common topic of conversation is how the city fares in terms of new business. A lot of entrepreneurs look longingly to either coast and the greener fields (in many respects ) that beckon. McKinsey talks about innovation (not venture financing, alas), but Chicago fares pretty well in the diversity of companies that have been granted patents. We are third in the world, behind only Silicon Valley and Toyko in one measure of developing a diversified business base. I have always felt that this was a hidden gem in the Chicago economy, compared to the boom and bust cycles of mono-industry cities like Detroit, Houston, Denver or Hartford.
Leadership: A friend pointed me to this article on entrepreneurial leadership in this economy. (Hat Tip: BF)
Healthcare: Should America have universal healthcare? According to the experts, 50 million of us are not covered by health insurance. We pay significantly more for healthcare on a per capita basis, have less access to advanced technologies and actually have worse outcomes than most other countries. Joe Conason, writes about the issue in Salon today.
Entrepreneurship: Paul Graham‘s new rallying cry is “Be Relentlessly Resourceful“.
Economy: Wonder why the prices of groceries haven’t been going down, as raw materials prices have? So have the big grocery chains.
Irony Alert: Google just bought a paper processing plant in Finland, so that they could repurpose the building into a data center.
Technology: Kevin Kelly has written a great (and long) post about the Amish and technology. To go back to my software days, the Amish are not in the Early Adopter portion of consumerdom, but surprisingly to many of us, they are a part of the technology buying spectrum.
Fun: Ever had a photo that you wanted to see reimaged as a charcoal sketch? You don’t have to break out the Photoshop. I have used the service at Dumpr in the past and been very happy with the results. Dumpr has some very interesting options, including celebrity pics. There is a new site, BeFunky that offers a number of other transformations, including cartoon, stencil, sunburst and inkify.
Behind the Scenes: I admit it. I love knowing what is going on behind the scenes. Have you ever wondered what goes on when your television news team goes to commercial? Check this out.
Entrepreneurship: John Patterson writes A Counter-Intuitive Lesson in Clarity (grammar alert). In it he talks about what makes entrepreneurs tick and why they need to surround themselves with people who have different worldviews. This is a key point in the growth of an entrepreneur… The ability to accept that you are a vision person and work with others who can help you refine your grand scheme into a viable moneymaking business opportunity.
Financial: Steven Pearlstein, writing in the Washington Post, today talks about Citizens South, a small bank in North Carolina. Citizens South is a well managed bank. They didn’t make risky loans and stayed conservative. Impressive among banks, they even turned a profit last year. Their president, Kim Price, applied for TARP bailout funds and received $20.5 million. Citizens South had no plans for the money until Price came up with a plan to offer, in conjunction with builders, low rate mortgages and no closing costs. Now mortgages are available to people who otherwise wouldn’t buy a house in this economic climate. A feel good story for sure.
However, I wonder about why a profitable bank that didn’t make bad loans is making the financial decision to take taxpayer money. Apparently, the bailout funds don’t come with a strong enough deterrent to focus their use for the most heavily impacted banks. While I am excited that this bank thought outside the box enough to expand home ownership to their customer base, why is the American taxpayer paying for this and what have the big guys (Citi, Bank of America, Chase) done with their bailout funds?
Big Picture: Paul Graham is a very strategic thinker. In his essay, “Keep Your Identity Small“, he compares religious and political arguments to most others. The key, he opines, is that you don’t have to be an expert to argue about either topic. In most other areas, one doesn’t usually participate in an discussion unless she has a minimum level of expertise. In religion and politics, anything goes. Paul advises us to keep our Identity small, so that we can be more tolerant of other’s positions.
Consulting: Ian Ayres talked about relational versus non-relational arrangements with large consulting companies. Pretty dull stuff, until Ian related these to Charlie Sheen‘s trial for using prostitutes and his quote “I don’t pay them for sex. I pay them to leave.”
Chicago: What if Oprah bought the Chicago Sun-Times?, Phil Rosenthal muses.
Business: Time Magazine discusses how this recession compares with others regarding job losses. It is scary out there folks.
Art: Something about the economy must be helping the Lego folks. There was a creative look at New York via Lego. And then this story about an artist who uses Lego bricks in his creations. And the inauguration in Lego.