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If you were thinking of launching a new beauty product, here’s the great news: The global beauty industry is booming. cosmetics.jpg

 

In the U.S., NPD Group and Statista report the cosmetics segment was worth $93.5 billion last year, up from $74.7 billion in 2018. According to projections, revenues this year should reach $97.3 billion. Globally, the industry is expected to have a market value of nearly $805 billion by 2023.

 

Somewhat surprisingly, the industry has long been welcoming to entrepreneurs, even though it’s dominated by iconic brands, both old (Estee Lauder, L'Oréal) and new (Mac, IT Cosmetics, Drunk Elephant and Fenty Beauty, to name a few).

 

How do you break into an industry with a lineup of brands like that? Like any startup today  you have to follow the trends and understand the country’s changing demographics. But to gain share in a highly competitive environment, you need to launch with a disruptive product or concept.

 

One of the advantages of being a beauty startup is the industry is so broad and diverse, there are many paths to building brand awareness. Statista defines the main product categories of the cosmetic market to include skincare, hair care, make-up, perfumes, toiletries and deodorants, and oral cosmetics.

 

M&A activity

 

Entrepreneurs launching beauty businesses today are likely thinking about their potential exits, even as they come into the market. Reality is while you can gain a foothold in the market by introducing a disruptive product, in the long run it’s hard to compete with the major players.

 

Mergers and acquisitions “in the beauty category have been on fire for several years,” according to industry blog BeautyMatter.  This M&A activity is good for smaller brands. Susan Babinsky, SVP of Kline Group, told BeautyMatter, “The flurry of M&A activity…has reduced the pipeline of good-sized opportunities [so] companies are snatching up small and sometimes less proven businesses—often for quite a premium.”

 

The success stories in this industry are truly astounding.

 

IT Cosmetics got its start in 2008 when then news anchor Jamie Kern Lima couldn’t find a product to cover her rosacea and hyperpigmentation. After consulting with plastic surgeons and dermatologists she launched her disruptive product,  Bye Bye Under Eye concealer. Kern Lima gained attention by selling on QVC and sold the company in 2016 to L'Oréal for $1.2 billion.

 

In 2019’s biggest beauty M&A deal Elemis, founded in 1990 by three entrepreneurs, was bought by L’Occitane International S.A. for $900 million.

 

Tiffany Masterson started Drunk Elephant in 2012 after she couldn’t find products without the six ingredients (the “Suspicious 6”) she thought shouldn’t be in skincare products. At the time “clean” products were a disruptive concept. Within two years the brand had attained cult-like status, and was Sephora’s top-growing skincare brand. Last fall Shiseido bought the company for $845 million.

 

Of course, you don’t have to exit your beauty startup to succeed. Glossier’s Emily Weiss was a beauty blogger who decided to transform her business. She got turned down by 11 VC companies, before one said yes and funded her. She launched in 2014 with four products. Although she told The Cut,  “I had no idea what I was doing. I was 28 years old. I didn’t have an M.B.A. I went to art school,” Weiss succeeded by focusing on millennials. Glossier is valued at $1.2 billion.

 

What trends will dominate this year? Ilya Seglin, Managing Director at Threadstone told BeautyMatter:

 

  • “Clean” beauty will continue to grow, but businesses with “influencers with marketing megaphones and/or distribution partners that can help grow sales” will attract the most attention.

 

  • Corporations interested in acquisitions will be “looking to buy true innovation and consumer engagement,” particularly with younger demographics.

 

  • Most beauty brands will need to become beauty businesses to attract capital/get sold.

 

Other experts predict haircare and skincare products (particularly “clean”) will be strong this year.

 

Getting exposure

 

There are several avenues for new beauty brands to get exposure.

 

 

  • · Sephora Accelerate is a 6+ months-long program “dedicated to building a community of innovative female founders in beauty.”

 

  • · Target Takeoffinternally-run accelerator programprogramming, guidance and mentorship to help startups learn how to scale to mass retail.

 

There are other ways to explore the beauty business. Service providers (hair salons, barber shops) are often dependent on product sales to make a profit.

 

You can open a beauty supply store—on- or off-line.

 

NPD’s Jensen says her “one word to characterize the beauty industry for 2020 is ‘connection’,” meaning “the human connection we have to each other, to brands, and to the environment.”

 

 

About Rieva Lesonsky

 

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the Rieva headshot.pngblog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.

 

Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.

 

Web: www.growbizmedia.com or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here

 

Bank of America, N.A. engages with Rieva Lesonsky to provide materials for informational purposes only, and is not responsible for, and does not guarantee or endorse any of the third-party products or services mentioned.  All third-party logos and company names mentioned herein are the property of their respective owners and are used under license from Rieva Lesonsky.

 

Bank of America, N.A. Member FDIC. ©2019 Bank of America Corporation

George Bernard Shaw allegedly said, “Youth is wasted on the young.” One could make the same argument about entrepreneurship. older couple.jpg

 

While we are regaled with the success of wunderkinds like Mark Zuckerberg, consider the uber-successful entrepreneurs who started their businesses later—much later—in life. Colonel Harland Sanders started franchising KFC when he was 62 and Ray Kroc launched the McDonald’s juggernaut at 51. Martha Stewart who believes, “You should never retire; you shouldn’t even use the word. It implies going off into the sunset, and who wants to do that?”, started her magazine empire at 50. Coca-Cola, Red Bull and Nestle’s were all started by men in their 50s.

 

If you’re considering starting a business, whether you’re a Gen X’er in your 50s or a baby boomer in your 60s (or even 70s), these iconic role models should give you hope. And the numbers are on your side as well. According to the Trends for Boomers report in the 2019 State of Small Business study from Guidant Financial and Lending Club, “Boomers rule American small business.”

 

Motivation for startup

 

What’s the impetus behind the boomer business surge? The Guidant reports says boomer men start businesses because they want to be their own boss, while boomer women start  to “pursue their passion.” Bridget Weston, CEO of SCORE, says “Research from our Megaphone of Main Street data report series shows baby boomers tend to start businesses out of necessity, such as getting laid off from a job. They might face challenges like age discrimination in the workforce, and business ownership is a rewarding way to capitalize on the valuable skills they have honed over the course of their careers.”

 

Aliza Sir, director of Financial Security at the AARP Foundation, says we’re experiencing a wave of “encore entrepreneurship.”

 

Data from the Kauffman Indicators of Entrepreneurship show the percent of the U.S. population that starts a new business is highest in the 45-55 year-old category (39%), with 55-65 year-olds a close second (38%).

 

Boomer business struggles

 

Guidant’s data show the most challenging part of running a business for boomers is lack of capital or cash flow. Their second biggest challenges vary. For newer companies (0-3 years in business) it’s marketing and advertising, companies in business 4-7 years cite time management and administrative work (bookkeeping and payroll), while companies in business more than 8 years struggle with recruiting and retention of employees.

 

Better odds of success

 

A study conducted by two MIT professors and the U.S. Census Bureau shows:

 

·        Businesses founded by a 50-year-old are 2.2 times more likely to be successful than those founded by a 30-year-old and 2.8 times more likely to succeed than those founded by a 25-year-old

 

·        Businesses founded by a 60-year-old are 3 times more likely to succeed than those founded by a 30-year-old

 

Boomers are in this for the long run—73% of those surveyed by Guidant are focused on growing their current businesses, 19% want to open an additional location, while only 8% are considering selling their businesses.

 

Some entrepreneurs are taking advantage of the trend. Tom Kamber started Senior Planet in 2006 to serve those who are “aging with attitude.” In their six locations across the country, boomers can take (mostly) free classes where they learn the computer skills (digital photography, social media, website creation) that can help them launch businesses.

 

Talking to The MIT Technology Review, Kamber says he believes that while age is not a barrier to entrepreneurial success, sometimes technology can be. “When you’re a senior, and you’ve got an idea, and you want to make it happen,” he says, “somebody’s got to help out a little bit.”

 

Ready to make the leap?

 

Before you jump into boomer entrepreneurship, consider the risk. Starting a business at any age entails some risk, but the older you are, the less time you have to recoup any losses from a startup gone wrong. You can mitigate the risk by:

 

·        Teaming up. Starting a business with a partner can expand your capabilities, reduce your risk, and make the startup journey a little less lonely.

 

·        Purchase an existing business or franchise. It’s often less expensive and less risky to buy an existing business. Before you close the deal, have an attorney and accountant vet the business.

 

Suggested Reading: What Every Entrepreneur Should Know Before Buying a Business

 

Here are some tips to help you succeed:

 

·        Location. If possible, launch your business from home or a local coworking space to save on overhead.

 

·        Create a business plan. No matter what type of business you’re starting, you need a business plan to help guide you.

 

·        Tap into your network. You should have plenty of contacts and connections who can help you launch.

 

·        Be tech savvy. Your business needs a mobile-friendly website. You’ll also need to know about social media, SEO and other digital marketing tools.

 

No matter your motivation, whether it’s necessity or choice, whether you’re pushed out of your last job, or just decide your time has come, make the leap. I started my own company in my 50s—and I have no regrets.

 

 

About Rieva Lesonsky

 

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah. Rieva headshot.png

 

Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.

 

Web: www.growbizmedia.com or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here

 

Bank of America, N.A. engages with Rieva Lesonsky to provide materials for informational purposes only, and is not responsible for, and does not guarantee or endorse any of the third-party products or services mentioned.  All third-party logos and company names mentioned herein are the property of their respective owners and are used under license from Rieva Lesonsky.

 

Bank of America, N.A. Member FDIC. ©2019 Bank of America Corporation

It’s amazing what a fresh set of eyes can do.woman-shopping-1727684.jpg

 

One of the dangers of owning a business and being the boss is that one can tend to get myopic; you see what you see and know what you know and getting a fresh, outside perspective can sometimes be challenging.

 

That came to light for me recently while coaching some MBA students. Their big idea? Creating a platform that would be a better way for businesses to offer free demonstrations in their stores.

 

“What problem does that solve,” I asked.

 

“It gets people into stores!” they replied.

 

Good point.

 

And that got me to thinking about the state of business in this new decade. If you are going to be starting a business, which makes more sense – an online store or a brick-and mortar store? Well, let’s consider the pros and cons of each:

 

Brick-and-mortar pros and cons

 

We hear a lot about the so-called “death of retail.” My take is that there is of course some truth there, if exaggerated. Yes, big box stores like Sears and J. Crew are in deep trouble, but, that said, small business is as healthy as ever.

 

This is especially true in this robust economy, and that too is no small thing. People have money, and are spending it, and they are still spending it in physical stores, despite what the naysayers say.

 

Consider the bookstore. If ever there was a type of business that seemed destined for the scrapheap of history, it was the physical bookstore. Such an antiquated, cute notion – wandering and browsing through a shop with a limited number of titles and retail prices.

 

Not long ago, the headlines screamed that huge competitors like Barnes & Noble were going to put them out of business. Didn’t happen. Then it was surely going to be Amazon who was going to swallow them all up.

 

That didn’t happen either.

 

According to the New York Times, “The American Booksellers Association, a trade group for independent bookstores, has grown to 1,887 members with 2,524 locations as of May 15 [2019], the highest participation since at least 2009.”

 

So that’s the good news. People still like going into stores, and if the store is well run and competitive on price, it can thrive.

 

The downside is that it is considerably more expensive to own and run a brick-and-mortar store. Labor, rent, insurance, etc. are all overhead costs not matched by their online equivalent.

 

E-Commerce pros and cons

 

Despite the above, we all know that the trend in shopping is towards e-commerce. Amazon isn’t Amazon for nothing, and Alphabet, the parent company of Google, just topped a trillion dollars in valuation because of all those little ads pointing people to online stores.

 

The pros are obvious: People love to shop online and are only going to do more of it. The cost of entry is significantly lower than getting into a physical store. And, for example, with something called “drop shipping,” you do not even have to carry inventory to stock your online shelves.

 

But the good news is also the bad news. Yes, there are a lot of people shopping online, and yes that is where things are headed. But that also means that there is a lot of competition.  Getting heard above the din is no easy feat online. Getting people to your little online store, and then getting them to buy from you and not someone else is challenging.

 

So, what’s the best choice? How about both? Open a store and sell online. Heck, if Jeff Bezos is now selling both online and off (Amazon Go, Whole Foods, Amazon Bookstores), it might not be such a bad idea.

 

Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert Steve+Strauss+Headshot+SBC.pngcolumn is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest, The Small Business Bible, now out in a completely updated third edition. You can also listen to his weekly podcast, Small Business SuccessSteven D. Strauss.

 

Web: www.theselfemployed.com or Twitter: @SteveStrauss

You can read more articles from Steve Strauss by clicking here

 

Bank of America, N.A. engages with Steve Strauss to provide materials for informational purposes only, and is not responsible for, and does not guarantee or endorse any of the third-party products or services mentioned.  All third-party logos and company names mentioned herein are the property of their respective owners and are used under license from Mari Smith.

 

Bank of America, N.A. Member FDIC. ©2017 Bank of America Corporation

It is difficult to comprehend just how far and fast WeWork went from nothing to something and then from something to nothing.chuttersnap-cGXdjyP6-NU-unsplash.jpg

 

But let’s try, because in WeWork’s epic rise and fall, there is a vital lesson for small business people. Consider:

 

  • WeWork was founded in 2010 by Adam Neumann and Miguel McKelvey. Their big idea was this: Because office space in New York is so expensive and finding, furnishing, and maintaining a nice office was cost prohibitive, WeWork would buy or rent offices, make them cool, and then lease shared office space to tenants. The idea took off.
  • By 2014, WeWork was considered “the fastest-growing lessee of new office space in New York” and was on track to become “the fastest-growing lessee of new space in America.”
  • By January 2015, WeWork had 51 coworking locations across the U.S. and Europe - twice as many as in 2014. WeWork was named one of the “most innovative companies” of 2015 by Fast Company magazine.
  • In 2016, the company raised $430 million in investment capital and had a valuation of $10 billion.
  • In 2018, SoftBank invested $3 billion in WeWork, and another $2 billion a year later.
  • In January 2019, WeWork was valued at $47 billion. Its IPO prospectus said, in part, “Our mission is to elevate the world's consciousness.”

 

And that is when the wheels began to fall off.

 

So flush with money was WeWork that it started spending in extravagant, crazy ways. How crazy? Let me share a personal story:

 

Two years ago, I was asked by WeWork to attend its Creator Awards in New York. It was a wild night; unlike anything I had ever seen, and emblematic of everything that was to go wrong.

 

WeWork’s CEO Adam Neuman was supposed to award one winner $1 million, that, in and of itself was wildly extravagant. But so overwhelmed was he by the 13 finalists, that he spontaneously decided to award a second winner another $1 million, and then he decided to give each runner up about $250,000 each.

 

The $1 million night became a $4 million night, and it happened in 45 seconds.

 

Multiply that by private jets, excessive growth (We Work bought the storied Lord & Taylor building on 5th avenue for its headquarters for $850 million) and crazy policies (Neumann sold the “We” trademark to his own company for $5.9 million) and you can see why its plan for an IPO in 2019 started to go up in smoke. In a few short months, WeWork’s profligate spending came under intense scrutiny and before long:

 

  • Its $47 billion valuation fell to $8 billion in nine months
  • Neumann resigned as CEO
  • The IPO was shelved
  • SoftBank took control of the company

 

What Went Wrong (Besides Everything)?

 

First, obviously, their spending was out of control, but it was more than that. Clearly, Neumann never graduated from the entrepreneur stage to the businessperson/CEO stage.

 

Entrepreneurs like Neumann are necessary. Their vision, passion, and energy are needed to get a company launched. But that is not enough. Vision doesn’t pay the bills. Before long, if you want to last, you need to learn and master the more mundane parts of business – law and taxes, insurance and finances, hiring and firing, and so on. WeWork never did.

 

Second, WeWork grew too big, too fast. That too is a danger to be avoided. Scaling a business is not easy. To go from one person (where most business start) to 2 to 10 to 100 and beyond requires planning, infrastructure, training, policies, financing and much more. Most of all, it requires time. Setting the foundation in place properly is the best way to create lasting success. Moving too fast allows one loose Jenga piece to topple the whole structure.

 

Third, hype and hyperbole do not a business make. Oh sure, we all like buzz and attention, and that can help grow a business but attention, if not managed, is just so much hot air.

 

Example: I once helped a pizza joint get the attention of a local food critic. One Friday, the critic wrote a glowing review of the restaurant. That weekend, the place was slammed, but because they weren’t ready, they didn’t have enough wait staff, ran out of dough, and pissed off a lot of customers.

 

Buzz can be a buzzkill if not managed properly.

 

The moral? Grow fast and furious, get high on your own success, get into debt you can’t manage, over promise and under deliver, and you will go from we work to no work in a hurry.

 

About Steve Strauss

 

Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert Steve+Strauss+Headshot+SBC.pngcolumn is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest, The Small Business Bible, now out in a completely updated third edition. You can also listen to his weekly podcast, Small Business SuccessSteven D. Strauss.

 

Web: www.theselfemployed.com or Twitter: @SteveStrauss

You can read more articles from Steve Strauss by clicking here

 

Bank of America, N.A. engages with Steve Strauss to provide informational materials for your discussion or review purposes only. Steve Strauss is a registered trademark, used pursuant to license. The third parties within articles are used under license from Steve Strauss. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

 

Bank of America, N.A. Member FDIC. ©2017 Bank of America Corporation

Sometimes entrepreneurial success is finely crafted—planned out years in advance. More often, it’s a matter of serendipity, of paying attention to what the universe brings you, accepting it and letting spontaneous combustion take care of the rest.

 

That’s what happened to Kelley McShane and Nick Carr, a young married couple who just happened to be in the right place at the right time when the universe came calling. #2+Granny-Bottle+Photo-w-frame copy.jpg

This is the story of the Granny Squibb Company, a beverage business (they sell six flavors of iced tea) based in Providence, Rhode Island, with dreams of becoming a big fish in a small pond. And the story of how a small business transitioned management from family to friends without losing its soul.

 

Granny Sqibb’s tea is brewed for today’s health-conscious consumers—it’s organic and non-GMO, but it’s rooted in the past. In the early 1930’s Sally Squibb (yes, there was an actual Granny Squibb) took a recipe her mother-in-law gave her and brewed a cold tea (apparently, unusual in those days). Granny thought her brew was “astonishingly delicious” and shared it with the local community.

 

Flash forward to 2009, when Sally’s granddaughter Robin retired from the film business, moved back to Providence and decided to bottle her grandmother’s recipe, saying Granny had always encouraged her to try everything and “never say never.”

 

Robin tried 50 or so different formulas before settling on the one that was as “astonishingly delicious” as her grandmother’s and launched the Granny Squibb Co. with sweetened and unsweetened version of two teas—Sally’s Lemon and Mojito Lime.

 

The rest of the story unfolds like a Hallmark movie—except the “heroic” young couple was already married when they rented an apartment in Robin Squibb’s home.

 

Neither had beverage experience. Carr was a financial advisor; McShane ran her own tutoring company and worked for a local nonprofit. But in an instant, they went from being friendly renters to co-owners (managing partners) of the Granny Squibb Company.

 

I talked to Kelley McShane about their unlikely journey becoming beverage entrepreneurs.

 

20190109-223310-Squibb.jpg

Rieva Lesonsky: The st0ry about how you and Nick came to be involved is the stuff of TV movies. Was it really that straightforward?

 

Kelley McShane: Yes. We moved into the house two years ago—and became part of the business 18 months ago. We were friendly with Robin. One day Nick passed her in the hall and asked, “How’s it going?” She told him (half joking), it had been a terrible day and asked, “Do you want it?”

 

Nick came upstairs and said to me you won’t believe what happened. We went down to her apartment and asked, “Were you serious?” And she was. She’d been working on the business for nine years, had gotten the teas in local chains like Dave’s Marketplace, Whole Foods and Wegmans.

 

But she’d been a one-woman show. The company survived by barely marketing.

Lesonsky: What made you think you could run a beverage company?          Oct6 square copy.jpg

 

McShane: We had both just turned 30. We wanted a change, wanted an adventure, wanted to work together. We’d been married for five years, but never saw one another.

 

Robin agreed to stay on for one year to mentor us. And a year in, we were ready. We still live in the same apartment, which makes it convenient. Robin is very creative and still involved in the big-picture decisions.

 

Lesonsky: You came in with an existing infrastructure in place. How did that work?

 

McShane: It wasn’t complicated. This is her grandmother’s legacy. We knew we needed to keep the integrity of the company and the brand.

 

We worked full-time for two months before the papers were signed. We just sat down and agreed on everything. People warned us against doing that. But we did it, and it worked. Then we brought in the lawyers and made it legal.

 

We learned from Robin. Once we were in the industry and trained, we had our own ideas. We built the [new] infrastructure together. We still see her every day. There’s not a lot of opportunity to be sneaky.

 

Lesonsky: What are your expansion plans?

 

McShane: Last winter we added a third flavor, Charlie’s Cranberry, named after Robin’s dog. We made it in the same house Granny Squibb lived in. Used the same tea kettle and measuring cups and sat at the same table Granny did.

 

We’ve expanded to upstate New York and in New England. In 2020 we’re adding new distribution in Massachusetts. But we want to focus on growing sales in Rhode Island.

 

We don’t want to go nationwide. We’re a New England product. And we’d like to stay here. We source our ingredients in New England. We can drive to accounts if there’s a problem. We want to be accessible. Be local. Build a local, legendary company.

 

Lesonsky: What has the biggest surprise been for you?

 

McShane: By far how incredibly supportive other RI brands have been. Companies like Yacht Club Soda (the official soda of RI) have gone over and above to train and support us.

 

Everyone in RI is easy to work with. People here work with integrity and kindness. We were warned the beverage industry was cutthroat. Not in RI.

 

Lesonsky: What was your biggest challenge?

 

McShane: The first year was hard. We were working 24/7. You have to. And growth took off.

 

At one point Nick and I spent 72 hours within 30 feet of one another. That was tough. But we know it would be. We planned for it. We heard the people who said “don’t work with your spouse.” We knew we needed to expand so we didn’t have to work with just one another. At the beginning we’d go to a trade show and trip over each other’s words. One year in—we got the spiel down, got stronger and more confident.

 

Lesonsky: I know community involvement is important to you. How does Granny Squibb do that?

 

McShane: We participate in tons of community events, like Save the Bay. We donate a percentage of sales from the Charlie’s Cranberry to benefit them. [McShane actually swam Narragansett Bay for the event.]

 

We encourage our employees to pick a cause they support and get on their boards.

We just launched our first big digital campaign, If We Can, We Will. Any Rhode Islander can send an email telling us what they need, whether it’s volunteers for an event, connections, or help with collecting items for drives. If we can help them without spending any money, we will.

 

Lesonsky: Sales increased about 40% in your first seven months. What changes did you bring?

 

McShane: In 2018 we added marketing. In 2019 we focused on sales—and they more than doubled—up 250%.

 

Lesonsky: And you’re in this for the long haul?

 

McShane: We are committed to being beverage entrepreneurs. We’ve found our calling. We love iced tea. We love the story.

 

What we really value is the people here. We all love each other.

 

About Rieva Lesonsky

 

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business Rieva+Lesonsky+Headshot.pngand entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.

 

Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.

 

Web: www.growbizmedia.com or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here

 

Bank of America, N.A. engages with Rieva Lesonsky to provide informational materials for your discussion or review purposes only. Rieva Lesonsky is a registered trademark, used pursuant to license. The third parties within articles are used under license from Rieva Lesonsky. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

 

Bank of America, N.A. Member FDIC. ©2019 Bank of America Corporation

A recession within the coming year seems more than likely. While the economy is great today, more than a few economists believe a 2020 recession is quite possible.

 

And that begs these questions: set-of-tool-wrench-162553.jpg

 

1. What if you are looking to start a business today?

 

2. Are there businesses that you could start – or branch into – that are more likely than others to weather the storm?

 

Indeed, there are. Here are the eight industries that thrive under recession conditions:

 

1. Candy: Yes, you heard right. Candy and recessions go hand in hand. Both Three Musketeers and Snickers were invented during the 1930’s depression, and in the U.S., candy sales went up by billions of dollars in the last recession, in 2009. When people can’t afford larger luxuries, they turn to the smallest - and sweetest - kinds. And that means a retail business can launch, or grow, using candy as a lure.

 

2. Repairs: During a recession, because buying new is not always a possibility, repairing items already owned becomes far more popular. For instance, while car sales historically go down during a recession, automotive repairs go up. The same can be said for computers, furniture and the like. For those who are handy, this can be a boon.

 

3. Childcare: Some of the best industries during a recession are the ones people can’t live without. When people have children and jobs, they are more than likely to need childcare, especially as they tend to take whatever work (and hours) they can get. This could mean daycare, or an after-school program, or even babysitting – all of these industries remain crucial during times of recession.

 

4. Niche food stores: In a recession, you might expect the most expensive grocery stores would go belly-up. But this wasn’t the case in 2008. In fact, specialty food stores experienced growth throughout the recession. When someone really loves something (like candy!) buying it during a recession becomes a refuge. As such, specially made, hard to come by, or totally niche items can work.

 

5. Freelance and temp work: Among the first casualties of a recession is the full-time employee. Many businesses switch to hiring freelance and temp workers to fill the gaps. As such, one of the best industries during recessionary periods is the freelance market, where independent contractors provide businesses the ability to keep going, as they are more affordable than their full-time counterparts. The time to start your side-gig is now.

 

6. Static businesses: The boring, the mundane, or downright dirty. Some may call them these names, but others call them recession-proof. Businesses like tax preparation, junk hauling, senior care, accountants, funeral homes and so on provide services that will always be necessary, even during an economic downturn. People will always pay taxes, throw away garbage and die. While these industries aren’t sexy, they provide a sense of stability in unstable times.

 

7. Health and fitness: In 2008, many industries came to a screeching halt. But not this sector. Businesses that helped people remain healthy and fit maintained steady growth during that era. This was particularly true for yoga and Pilates studios.

 

8. “Sin” industries: When the going gets tough, people crave vices. During down times, sales of alcohol boom, casinos do well, and marijuana sells (this will especially be true as legalizing cannabis becomes more widespread.) It makes sense, no? When people are feeling down, they often turn to something to help ease their discomfort. Any of these ‘sin’ industries tend to have steady growth during a recession.

 

Although this is not a comprehensive list by any means, it can give you some clues as to what is and isn’t recession-proof.

 

Read next: 5 Financial Tips for the Side Hustler

 

About Steve Strauss

 

Steven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert Steve+Strauss+Headshot+SBC.pngcolumn is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest, The Small Business Bible, now out in a completely updated third edition. You can also listen to his weekly podcast, Small Business SuccessSteven D. Strauss.

 

Web: www.theselfemployed.com or Twitter: @SteveStrauss

You can read more articles from Steve Strauss by clicking here

 

Bank of America, N.A. engages with Steve Strauss to provide informational materials for your discussion or review purposes only. Steve Strauss is a registered trademark, used pursuant to license. The third parties within articles are used under license from Steve Strauss. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

 

Bank of America, N.A. Member FDIC. ©2017 Bank of America Corporation

There’s a lot of information available to those who want to start a business. So much, in fact, it can feel overwhelming. So, let’s cut to the chase and look at the three key steps to successfully starting a business: woman-in-front-of-her-computer-3059745.jpg

 

Focus, fact-finding and finances.

 

1. Focus: Make a commitment

 

Unswerving focus separates the dreamers from the doers. If you want to start a business, you must commit to making it happen. Set aside time to work on your business every day. Just half an hour a day is all it takes to make steady progress. Can you give up half an hour of watching Netflix, hanging out with your friends or scrolling through Instagram to focus on your business?

 

If not, you probably don’t have what it takes. (Sorry to be so frank, but starting a business is not for the easily discouraged.) To stay motivated, find a support system—someone who will encourage you and hold your feet to the fire when necessary.

 

2. Fact-finding: Do your homework

 

 

You’ve got a business idea. But is it a viable idea?

 

To find out, first research your competition, including both online and offline competitors. Learn as much as you can about them. Visit their businesses, dig deep into their websites, look at their marketing and pricing. What can you offer that’s different and better?

 

Next, research your target market. Who will buy what you’re planning to sell? You can’t target the whole world. In fact, the more you can narrow your target market, the better. Learn so much about your target customers you can picture them in front of you:

 

  • Where do they live?
  • What do they do?
  • Are they married?
  • Do they have children?
  • How do they spend their free time?
  • What’s their discretionary income and what do they spend it on? 

 

You may discover your market is too small to support your business. It’s better to learn this now than after you open your doors. Adjust your business idea or find a new target market and keep going.  Once your target customers are defined, figure out how you will sell to them. Will your product be sold in your store, sold through another retailer, or sold online? If it’s a service, will you deliver it yourself or hire employees? Will you sell direct to customers, hire outside salespeople, or sell to a reseller? 

Suggested reading:  How to develop a business plan

 

3. Finances: Set a budget and source your startup capital


You know your business idea is viable. But, how much will it cost to launch? There are lots of expenses to consider, including the costs of:

 

  • Buying or making a product
  • Renting a location
  • Creating and maintaining a website
  • Marketing and advertising
  • Equipment and business supplies
  • Hiring employees or independent contractors

 

Like much in life, a business startup often costs more than you expect, so build wiggle room into your budget.

 

Now, figure out how you will get the money. It’s very difficult to get startup financing from outside sources, so most startup entrepreneurs use their own money or borrow from friends and family. Can you tap into savings, sell some assets, start part-time or work a second job? Get creative about finding ways to finance your dream.

 

Suggested reading: Tips on How to Finance Your New Business Venture

 

Bonus step: Get help

 

There are many resources available to help you start a business. Find local organizations, such as economic development centers, that assist business owners. Educate yourself by taking classes at your local community college.

 

Two great resources available nationwide are SCORE and the Small Business Development Center) network. Each provides free or low-cost business consulting and advice from successful business owners and business experts. SCORE’s website has tons of tools such as online webinars, training courses and templates to get you started. (Note: SCORE is a client of my company, but I’d recommend them even if they weren’t.) 

 

Next: Schedule an appointment to talk to a Bank of America Small Business Specialist.

 

Focus, facts and financing are the three essential keys to startup success. Commit to each of them and make 2020 the year you actually launch your business.

 

About Rieva Lesonsky

 

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and Rieva+Lesonsky+Headshot.pngentrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.

 

Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.

 

Web: www.growbizmedia.com or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here

 

Bank of America, N.A. engages with Rieva Lesonsky to provide informational materials for your discussion or review purposes only. Rieva Lesonsky is a registered trademark, used pursuant to license. The third parties within articles are used under license from Rieva Lesonsky. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

 

Bank of America, N.A. Member FDIC. ©2019 Bank of America Corporation

Business ideas are easy. Entrepreneurs can see a dozen opportunities a day if they keep their eyes open and their minds sharp. From parking a car to waiting in line at the coffee shop, anywhere there’s a difficulty or a problem there’s a solution waiting to be monetized.

 

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The challenge is turning that idea from concept to a service.

 

That takes planning. It takes time and it takes money, too. Coming up with an idea requires only a moment of inspiration. Building a business requires risk, effort and work.

So, when you’re full of good ideas, how can you tell which is the one that will bring you the most success? Which idea is worth making that investment?

 

Start with the traditional method: turn your business idea into a business plan.

 

In an age of pitch decks and Powerpoint presentations, that might sound old-fashioned. But creating a business plan, even if it’s only for yourself, forces you to take a hard, objective look at the product you want to create. It tells you what you’ll need to create it.

 

Of course, you’ll come away with an idea of the amount you’ll need to invest, and the sort of revenues it can bring in. But you’ll also come away with a deeper understanding of the product. The act of describing it will help you to understand what you can build and which features are unlikely to work in practice. And as you look at your market, you’ll come to see both its size and its make-up. Do the ideas include customers you want to spend time with? Are they people you want to help?

 

Once you’ve created a business plan, you might be able to begin work on the production. Someone hoping to open their own fashion boutique, for example, could start by creating a few pieces and seeing how they sell online or at fairs. Getting that feedback early would be better than investing in a complete store and hoping that people like it enough to tell their friends and return regularly.

 

Outlets like Etsy and Ebay offer easy ways to reach and test a market once the marketing is right. You can even create a Facebook page, start building followers, and use their comments to find out whether the interest you thought you’d generate is there.

 

There is a difference though between saying that a product is good and actually willing to part with cash for it. That’s why some businesses use crowdfunding sites not just to raise funds to pay for production but to market-test interest in their product. If people are willing to pay in advance to help a business create a product that they find interesting—whether that’s a new kind of drone or an origami folding kayak—that’s a great sign that that other people will pay to own it too.

 

The success of a crowdfunding campaign often has as much to do with the quality of the campaign as the product itself though, so again, you’ll have to put in effort to get a reliable result. But if you meet the threshold you’ll have both a proven idea and enough funds to get you at least past the first stage of production.

 

 

None of this will happen quickly. A business plan might take you a month or more to research properly and put together. Building a prototype and taking your first steps into the market could take you months more  and give you the kind of feedback you really didn’t want to hear. Even a crowdfunding campaign now relies on creating both a version of the product and shooting a professional-looking campaign video… then promoting both with press releases and on social media.

 

Which is why doing all of that brings you to the most important test of your business idea. If, after writing a business plan, building samples, and pitching to a market, you still love the idea and still believe you’ll enjoy creating it, you know you’ve picked a good idea.

 

If your business idea is fun to develop, your customers will have fun using it. That’s how you know you’ve found the right business idea.

 

About Joel Comm

 

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As an Internet pioneer, Joel has been creating profitable websites, software, products and helping entrepreneurs succeed since 1995. He has been at the frontlines of live video online since 2008 and has a deep expertise in using tools such as Facebook Live, Periscope, Instagram or Snapchat to broadcast a clearly defined message to a receptive audience or leveraging the power of webinar and meeting technologies.

 

Joel is a New York Times best-selling author of 15 books, including “The AdSense Code,” “Click Here to Order: Stories from the World’s Most Successful Entrepreneurs,” “KaChing: How to Run an Online Business that Pays and Pays and Twitter Power 3.0.” He is Co-Host of The Bad Crypto Podcast one of the top crypto-related shows in the world and has spoken before thousands of people around the world and seeks to inspire, equip and entertain.

 

Web: https://joelcomm.com/ or Twitter: @JoelComm

Read more from Joel Comm

 

Bank of America, N.A. engages with Joel Comm to provide informational materials for your discussion or review purposes only. Joel Comm is a registered trademark, used pursuant to license. The third parties within articles are used under license from Joel Comm. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

Join two of Bank of America’s Small Business Bankers as they team up with entrepreneur and co-founder of Harlem Capital, Brandon Bryant, to offer some unique perspectives on the financial side of entrepreneurship. This session will be livestreamed by Brandon (@wallstreetpaper) from the Better Money Habits® Retreat in Miami, FL, where other entrepreneurs and small business owners are gathering this weekend to talk all things financial wellness.

 

From learning what inspired Brandon to pursue entrepreneurship to tips on how to take this next step in life, you can follow along and tweet questions to @wallstreetpaper on Saturday, September 27th at 4 p.m. ET

 

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The journey can look so long. When you’re sitting in your cubicle, counting down the hours until you can commute home, the distance from employee to entrepreneur can appear impossible to cross.

 

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It isn’t… and thousands of people make that journey successfully every year. According to the U.S.Chamber of Commerce, about 400,000 new businesses are started each year—and 70 percent of those businesses are still running two years later. Making the move from employee to entrepreneur requires just three steps.

 

They’re big steps, but there’s just three of them.

 

1.    Measure and Find the Money You Need

 

The first step is the most frightening. Starting a business always costs money. Whether you’re opening an online store or planning to set up a law firm, you’re going to have upfront costs. You’ll have office expenses and marketing expenses. You’ll need to buy supplies and equipment. You might have to pay for licenses and salaries. Some of those costs will be predictable. Others you’ll only be able to estimate.

 

The same is true of revenues. It might be a year or more before you see a return on your investments, and even longer before you break even. You’ll need to know how much money you’ll need to take you to that break-even point—and where you’re going to get it from. You’ll need to measure your savings, talk to the bank, and understand how much you’ll have to pay for any loans that you take.

 

Tackling the finances will be difficult, but it’s the first step towards taking control of your business life.

 

2.    Build a Routine

 

Money is one vital resource that every entrepreneur needs. The other is time. The two are related, of course. The more time you’re able to devote to your business, the more money you’ll spend but the sooner you’ll be able to turn the red ink black.

 

Ideally, you’ll be able to walk into your boss’s office, thrown down your resignation letter and head off to your own business to work full-time. In practice though, what usually happens is that small businesses start in spare hours. They’re built in the evenings and early mornings, and they take off at weekends when barbeques and sports games are sacrificed for semi-professional photography shoots and product launches.

 

There’s a benefit to that gradual approach. It means that by the time you’re ready to go full-time, you’ll already know what you’re doing. You’ll know which products your customers like most and which marketing channels work best. Moving to full-time business-building won’t mean hoping that your business idea succeeds; it will mean scaling an idea that’s already showing signs of promise.

 

Before you become a full-time entrepreneur, build a schedule around your day job. Make testing different parts of your business part of your routine so that you get the riskiest and toughest parts of being an entrepreneur out of the way before you take the jump.

 

 

3.    Enjoy the Process

 

There are always difficult moments when building a business. There will always be challenges and failures and frustrations. There will also be successes, achievements, and a great sense of pride. No one expects you to enjoy the times when launches fizzle or clients walk away but you should be able to enjoy the journey overall.

 

Employees have a steady income. They know exactly how much money they’re going to make each month. They know what they have to do to get their next raise, and they know the maximum they can expect to earn. If all you’re interested in is your finances, then you’ll find it easier to match your lifestyle to your income than to build a business to raise your earnings.

 

You don’t become an entrepreneur only to get rich. You build a business because you enjoy the process of building it. You know that you’ll love working for yourself, and you’ll have real fun putting it all together.

 

The last step is the most important: create a business plan that you’ll really enjoy implementing.

 

About Joel Comm

 

Screen Shot 2019-02-08 at 9.16.44 AM.png

As an Internet pioneer, Joel has been creating profitable websites, software, products and helping entrepreneurs succeed since 1995. He has been at the frontlines of live video online since 2008 and has a deep expertise in using tools such as Facebook Live, Periscope, Instagram or Snapchat to broadcast a clearly defined message to a receptive audience or leveraging the power of webinar and meeting technologies.

 

Joel is a New York Times best-selling author of 15 books, including “The AdSense Code,” “Click Here to Order: Stories from the World’s Most Successful Entrepreneurs,” “KaChing: How to Run an Online Business that Pays and Pays and Twitter Power 3.0.” He is Co-Host of The Bad Crypto Podcast one of the top crypto-related shows in the world and has spoken before thousands of people around the world and seeks to inspire, equip and entertain.

 

Web: https://joelcomm.com/ or Twitter: @JoelComm

Read more from Joel Comm

 

Bank of America, N.A. engages with Joel Comm to provide informational materials for your discussion or review purposes only. Joel Comm is a registered trademark, used pursuant to license. The third parties within articles are used under license from Joel Comm. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

Do you dream of being your own boss but don’t think you have enough startup capital? Starting a business is more affordable than ever.

 

Don’t believe me? Read on to discover 21 businesses you can start for $25,000 or less—and find out how you can win $25,000 to launch your dream business. (see note below)

 

First, the secrets to low-cost business success

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  • Start as a one-person business and hire freelancers/independent contractors as you grow.
  • Run your business from home and meet with clients at their office or a neutral location.
  • Instead of buying new equipment, buy used or lease what you need
  • Focus on basics: a computer, smartphone and a website, plus any licenses, permits or certifications you need.
  • Consider incorporating to protect your personal assets from liability.

 

Best business startup ideas under $25,000

 

  1. Tutoring service: Tutor students in their homes or offer services at schools.  (National Tutoring Association)
  2. Photography business: Specialize in weddings, sports teams, class photos or pets; or market your services to businesses. (American Photographic Artists)
  3. Graphic design company: Create logos, marketing materials and more for business clients. (Graphic Artists Guild)
  4. Website design company: Help other small business owners create an online presence. Offer additional services, like SEO and marketing assistance, to boost your sales. (Association of Web Design Professionals)
  5. Event/Party/Wedding planner: Plan parties or weddings for individuals, or meetings and conventions for businesses. (PCMA, Meeting Professionals International)
  6. Personal trainer: Get basic workout equipment and certification from a professional organization and start helping clients shape up. (ACE, National Strength and Conditioning Association)
  7. Handyman services: Market your services to homeowners, property managers and landlords. (Association of Certified Handyman Professionals)
  8. In-home childcare service: Get licensed and insured, then start marketing your childcare services through word-of-mouth. (National Association for Family Child Care)
  9. Virtual assistant business: Help other small business owners with administrative tasks. (International Virtual Assistants Association)
  10. Consulting business: From IT and management to marketing and sales, just about any professional expertise can become a consulting business. (Institute of Management Consultants)
  11. Pool cleaning business: A used truck and equipment will get you started; network with other home services businesses to find customers. (Association of Pool & Spa Professionals)
  12. House painting service: Invest in equipment and promote your business via word-of-mouth and networking. (Painting and Decorating Contractors of America)
  13. Personal chef/Caterer: Cook up success preparing meals for private clients as a personal chef or cater bigger events for individuals and organizations. (National Association for Catering & Events, United States Personal Chef Association)
  14. Maid service: Busy Americans need someone to keep their homes clean. Also target the senior living-at-home market. (ISSA The Worldwide Cleaning Industry Association)
  15. Dog walking/Pet sitting service: Profit from Americans’ love of pets by watching and exercising their dogs. (National Association of Professional Pet Sitters)
  16. Crafts business: Sell your wares at Amazon, Etsy or local crafts fairs. (Craft Industry Alliance)
  17. E-commerce business: Find a niche and use drop shipping to keep your costs down. Also sell via a marketplace like Amazon or eBay. (Internet Merchants Association)
  18. Bookkeeping service: Put your skills to work helping other businesses get their finances in order. (National Association of Professional Bookkeepers)
  19. Mobile auto detailing service: A used truck or van and some equipment will get you started on the road to success. (International Detailing Association)
  20. College admissions/financial aid consulting: Getting into college is harder and more expensive than ever; help students and their parents prepare for success. (Independent Educational Consultants Association)
  21. Buy a franchise: Find low-investment franchises at the International Franchise Association(IFA) website.

 

Are You a Small Business Owner Interested in Winning $25,000?

 

Entrepreneurs who want to win $25,000 have the opportunity to do so by entering the Mastercard Grow Your Biz Contest, in association with Bank of America. To enter the Grow Your Biz Contest, small business owners must answer the simple question, “How would $25,000 help your business grow?” by submitting a video up to 1 minute long online explaining how they could use $25,000 to improve an existing business*. Four finalists will pitch their business to the Grow Your Biz Panel in New York City on 11/14/2019 for the chance to win $25,000, in addition to an industry-expert consultation.  Learn more at www.growyourbizcontest.com

 

*NO PURCHASE NECESSARY TO ENTER OR WIN. Void where prohibited. Open only to small business owners who are legal U.S. residents, and 18 and older. Ends 10/6/19. For Official Rules and complete details, click here.

 

About Rieva Lesonsky

 

Rieva Lesonsky Headshot.png

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.

 

Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.

 

Web: www.growbizmedia.com or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here

 

Bank of America, N.A. engages with Rieva Lesonsky to provide informational materials for your discussion or review purposes only. Rieva Lesonsky is a registered trademark, used pursuant to license. The third parties within articles are used under license from Rieva Lesonsky. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

 

Bank of America, N.A. Member FDIC. ©2019 Bank of America Corporation

Passion can be a powerful motivator for startup entrepreneurs. And for those starting a nonprofit business, passion is particularly important.

 

“Passion has to drive the individual or the nonprofit will fail,” said Jill Dominguez, the founder and CEO of Essergy, a consulting firm for nonprofits. “If you start a nonprofit thinking you will get rich, you’re starting it for the wrong reason.”

 

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Some of us discover our passion early in life—for others it comes later—after accumulating a lifetime of experience and knowledge. That is what happened to Brett Weiss, the founder and director of the Weiss Scholarship Foundation.

 

In 2009, Weiss, an Illinois native, then 59, headed to Dago, a small (population 3,000) village in Kenya. Weiss, in his second go-round of being a teacher (he sandwiched a career in software sales in between teaching gigs), had “always wanted to go to Africa and volunteer.” In fact, Weiss says, that’s why he returned to teaching in 2004—so he could have his summers free.

 

But like many of us, Weiss kept making “lousy excuses for not going.” Finally, a “health scare” in 2007 (thyroid cancer) gave him the “kick in the butt” he needed to join Village Volunteers and go to Dago.

 

Most residents of Dago, Weiss says, live in mud huts, without electricity or plumbing. The average family income is less than $2 a day. AIDS has decimated much of the adult population and Weiss says most children don’t have two living parents. Anyone experiencing that would be affected, but as a long-time educator, “I had to do something to help,” he said

 

He came back from Dago and got his students involved. They took on new projects every semester, including buying a cow for the village.

 

As he was preparing for his second trip in 2011, he wanted to do something “more substantial.” Drawing on his passion for education, he created the Weiss Scholarship Foundation to try to “end the cycle of extreme poverty.” At that time, most kids in Dago never went past 4th grade. High school is not free in Kenya, and most families can’t afford to send their kids. The Foundation awards high school scholarships—the first student who got a scholarship is attending university today.

To date, the Weiss Scholarship Foundation has awarded 54 four-year high school scholarships. They just started sending some of the kids who aren’t college-bound to vocational schools.

 

That’s the passion play. But what about business?

 

Weiss had never run a company before, but his father was an entrepreneur, so he was familiar with business ownership.

 

At the beginning, he did not form his own 501(c) (3) nonprofit. He “piggybacked” on another nonprofit that handled the donations, tax credits and legal and accounting issues. Weiss’s brother, a successful CEO and venture capitalist , came with him on his fifth trip to Dago—and the brothers decided to create an organization to help even more Kenyan children and become an enduring foundation—one that would last beyond Weiss’s lifetime.

 

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Weiss had to up his game. This is common among founders of nonprofits, Dominguez said. “The majority of nonprofits are started on a shoestring budget with money invested by the founders.” Indeed, up until a year ago, Weiss paid 100% of the operating expenses, adding up to about $70,000 of his savings.

 

Weiss started his own 501 (c) (3) in 2018. He admittedly knew “very little” about running a nonprofit. In the last two years he’s been on a “crash course to try to learn as much as I can. I really think of myself as an entrepreneur.”

 

He’s applied the business skills from his software sales experience—“I make lots of cold calls, on the phone and in person. Every day I repeat a line I heard so many times when I was in sales, ‘Every time you get a no, you are just one step closer to the yes.’”

 

The most challenging aspect of running the foundation for Weiss is balancing the “two parts of the job.  One is running the day-to-day operations and the other is doing short-term and long-term fundraising,” he said. “If I spend too much time on the operations part, then we are not raising enough money.”

 

Dominguez says most nonprofit startups find raising money to be their biggest challenge.  “Can you [continually] ask for money to achieve your mission? This is a different animal than starting a business. You are asking for a cause, not selling the latest tools,” she said. “You have no widget, just a belief in changing the world.”

 

To become “more professional,” Weiss turned to his network. He formed a Board of Directors (a legal requirement) and an Advisory Board, consisting of his former students. Another former student built his website for free; and one of his board members designed marketing materials.

 

Get 7 Tips on Choosing and Using Board Advisors from Carol Roth

 

If you want to help, go here.

 

The Questions to Ask Yourself

 

Do you have what it takes to start a nonprofit? Here are a list of questions Weiss asked himself before he plunged into launching a nonprofit.

 

  • I have this great idea; how can I make it real and successful?
  • Where am I going to get money?
  • What are my goals and what is my plan to make them a reality?
  • I will need help from people on the ground in Kenya. How am I going to get this help?
  • I am going to have to go to Kenya on a regular basis. How am I going to pay for this?
  • There will be other expenses. How am I going to pay for this?
  • How do I make sure this organization is always providing first-class service on a very limited budget?
  • How do I communicate with my donors and work to insure they will donate again?
  • How am I going to market this foundation with very limited resources?
  • How am I going to do this while I work my full-time job? I still need  income coming in?

 

          Read next:

 

About Rieva Lesonsky

 

Rieva Lesonsky Headshot.png

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.

 

Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.

 

Web: www.growbizmedia.com or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here

 

Bank of America, N.A. engages with Rieva Lesonsky to provide informational materials for your discussion or review purposes only. Rieva Lesonsky is a registered trademark, used pursuant to license. The third parties within articles are used under license from Rieva Lesonsky. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

 

Bank of America, N.A. Member FDIC. ©2018 Bank of America Corporation

Do you want to give back? Pay it forward? Change the world?

 

There are many ways to accomplish that. In the business world, many with those goals decide to start a 501 (c) (3) nonprofit organization.

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Navigating the world of nonprofits can be tricky. To learn more, I talked to Jill Dominguez, the founder and CEO of Essergy, a consulting firm for nonprofits about what it takes to be a nonprofit entrepreneur.

 

Rieva Lesonsky: In general, why do people start nonprofits?

 

Jill Dominguez: For the same reasons people start businesses—they see a problem and want to solve it. The same business principles apply, but your income is derived from getting donations and your success is measured by performance and trust. You don’t pay taxes on income, but you’re still operating a business—making payroll, paying payroll taxes, insurance, employee benefits, etc. A 501 (c) (3) is a tax status, not a profit margin indicator.

The biggest difference is you are selling a cause, not a widget.

 

Lesonsky: How do you get paid?

 

Dominguez: Salaries for executive directors of nonprofits are far below those of for-profit CEOs in similar fields. An executive-level salary review is required annually by nonprofits. IRS regulations keep your salaries and expenditures in line. A nonprofit has the American public to answer to as shareholders and the IRS as the “hall monitor.”

 

Lesonsky: When starting a nonprofit, what factors should you consider?

 

Dominguez: Questions to ask yourself before taking the plunge:

 

        • Know the need—and the market. Are you solving a problem that is already addressed by other nonprofits? Is what’s really needed a good volunteer and more money? Do your homework!
        • If the need is not being met, what’s the best usage of your time and effort? Should you serve on a Board of Directors and make that unmet need part of the mission of an existing nonprofit?
        • Assess your passion. Are you willing to work numerous unpaid hours, invest startup funds for your 501 (c) (3) application, learn a new skill set, new business operation rules, tax rules, accounting policies, answer to a Board of Directors? Non-profits are not for the faint of heart.

 

The real question is—can you ask for money? This is not as easy as it sounds. My rule is, “no blinking, no blushing.” If you believe in your cause enough to convince others to give you money and can spend it wisely and solve the problem you are promising to address, then go for it!

 

Lesonsky: Are there go/no go signs startup nonprofits should look for?

 

Dominguez: Yes, market drivers. Is the societal problem you are trying to solve best served by a nonprofit or are you crossing into business income territory? Do you need a 501 (c) (3) to develop a cure for what ails society? Do you need a nonprofit to tutor kids in reading or will a new education for-profit model do the same thing? Can you honestly say your nonprofit is serving a mission for public benefit that should be tax free? If in doubt, ask an expert.

 

Lesonsky: What’s the biggest challenge in starting a nonprofit?

 

Dominguez: Raising money.

 

Lesonsky: How are most nonprofits initially funded?

 

Dominguez: They’re self-funded. It takes about 18 months to get approved for 501 (c) (3) tax status and a professional to complete an application for nonprofit status. While you are waiting for approval you musttell funders all donations are pending a charitable contribution receipt. Or a fiscal agent can manage your startup.

 

Lesonsky: You’re a nonprofit guru. When you initially meet with nonprofit entrepreneurs, do you have a good idea if they’re going to succeed?

 

Dominguez: Yes, it only takes me a couple of hours. Here’s what I look for:

 

          • Do you know the problem you intend to solve?
          • Do you know your audience (those you’re helping and those who will fund you)?
          • Do you have the passion?
          • Do you have a “true believer” attitude?
          • Are you fearless?

 

I look for honesty, integrity and trust. Nonprofits are transparent. I check up on everyone. My reputation is at stake if I take you on as a client.

 

          Related Links

 

About Rieva Lesonsky

 

Rieva Lesonsky Headshot.png

Rieva Lesonsky is CEO and Co-founder of GrowBiz Media, a custom content and media company focusing on small business and entrepreneurship, and the blog SmallBizDaily.com. A nationally known speaker and authority on entrepreneurship, Rieva has been covering America’s entrepreneurs for more than 30 years. Before co-founding GrowBiz Media, Lesonsky was the long-time Editorial Director of Entrepreneur Magazine. Lesonsky has appeared on hundreds of radio shows and numerous local and national television programs, including the Today Show, Good Morning America, CNN, The Martha Stewart Show and Oprah.

 

Lesonsky regularly writes about small business for numerous websites and for corporations targeting entrepreneurs. Many organizations have recognized Lesonsky for her tireless devotion to helping entrepreneurs. She served on the Small Business Administration’s National Advisory Council for six years, was honored by the SBA as a Small Business Media Advocate and a Woman in Business Advocate, and received the prestigious Lou Campanelli award from SCORE. She is a long-time member of the Business Journalists Hall of Fame.

 

Web: www.growbizmedia.com or Twitter: @Rieva

You can read more articles from Rieva Lesonsky by clicking here

 

Bank of America, N.A. engages with Rieva Lesonsky to provide informational materials for your discussion or review purposes only. Rieva Lesonsky is a registered trademark, used pursuant to license. The third parties within articles are used under license from Rieva Lesonsky. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

 

Bank of America, N.A. Member FDIC. ©2018 Bank of America Corporation

Want to grow your social media following? Don’t do what I did.

 

Although I have been on Twitter for over a decade, I was still late to the party. Like many people, I didn’t really understand social media and I especially didn’t get Twitter. So, while I was early and fortunate enough to capture my name as my Twitter handle, I spent very little time back then tweeting, following, getting followers and the like.

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Dumb.

 

Some of my contemporaries were not so short-sighted and they jumped on the Twitter bandwagon with zeal. And it paid off. Anyone back then who had even a little buzz or presence was able to amass a huge Twitter following in fairly short order (in the hundreds of thousands.) And, frankly, not a few people got a large following even though they didn’t really have the chops or expertise to deserve it, but they were at the right place at the right time.

 

Once I realized that social media was not just some passing fad, I started doing the hard work of growing my social profile and presence. I did everything I was supposed to do (until I didn’t, more on that in a moment):

 

    • I created good looking social media homepages
    • I shared relevant content
    • I engaged with my followers

 

That said, I was frustrated that my following was not bigger or growing faster. So, I decided to do something about it – I bought some followers.

 

Dumb x 2.

 

I found a service and paid $99 for 1,000 Twitter followers. What a mistake. Little did I know but these were not real followers. My account was flooded with bots and fake accounts that took almost another year to clean up.

 

The lesson: There is a right way, and a wrong way, to grow your social media profile. Here’s what to do:

 

Post quality content: This is the most important rule. What you want to do is to create a feed that offers your followers content they can use. Whether you create the content or share someone else’s matters little. The important thing is to post content that people will like – that’s how you get people to follow you.

 

Mix it up: Post blogs, videos, podcasts, etc. Mix it up. Infographics and visuals especially are liked and shared, another important way to get followers: When others share your content, it is the ultimate digital word of mouth.

 

By the same token, it probably behooves you to mix up your tone as well. Sharing funny or otherwise emotional content works. Guy Kawasaki is great at this.


Use the 80-20 rule: The 80-20 rule says that 80 percent of your profit comes from 20 percent of your customers or products. The same idea should be in play here – 80 percent  of your social posting should be about your followers customers or other interests, while only 20 percent, at most, should be about you or your business.

 

Engage: People generally want to interact with you and/or your brand. Thus, the more you engage by chatting with them, re-posting their content, retweeting their tweets, and otherwise interacting with them, the more your organic following will grow.

 

Include social icons on you site, email, etc.: Include the icons of your social handles on your website, email, business card, etc. This allows those who come in contact with you to like and follow you.

 

Follow followers: This is one of my favorite tricks. There is a “Twittiquette” that says if someone follows you, you should follow them back. Now, this is by no means a hard and fast rule, but it is generally something that is followed.

 

As such, if you look at the followers of the leaders of your industry and follow them, they just may follow you back. Similarly, look for hashtags that are often used in your business and follow those people who use those hashtags. They too may follow you back.

 

Buy paid advertising: This is completely different from the mistake I made. On Facebook, you can buy Facebook ads that are designed to increase your Likes, and it works.

 

The great news is that, while all these efforts take time, they don’t cost much (even the ads are affordable.) As such, growing your social following can be one of the cheapest, easiest ways to find and get more customers.

 

Even better, they are real, as opposed to fake bots.

 

Follow @SteveStrauss and all the rest of our Small Business Community contributors on Twitter!

 

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About Steve Strauss

 

Steve Strauss Headshot New.pngSteven D. Strauss is one of the world's leading experts on small business and is a lawyer, writer, and speaker. The senior small business columnist for USA Today, his Ask an Expert column is one of the most highly-syndicated business columns in the country. He is the best-selling author of 17 books, including his latest, The Small Business Bible, now out in a completely updated third edition. You can also listen to his weekly podcast, Small Business SuccessSteven D. Strauss

 

Web: www.theselfemployed.com or Twitter: @SteveStrauss

You can read more articles from Steve Strauss by clicking here

 

Bank of America, N.A. engages with Steve Strauss to provide informational materials for your discussion or review purposes only. Steve Strauss is a registered trademark, used pursuant to license. The third parties within articles are used under license from Steve Strauss. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice. Bank of America, N.A. Member FDIC.  ©2019 Bank of America Corporation

There’s one fundamental difference between an experienced business owner and an aspiring entrepreneur.

 

An experienced business owner knows the value of an idea.

 

They know an idea is worth… nothing. Not a dime. Even a good idea.

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That’s because ideas alone are easy. You probably have at least one every time you take a shower. The hot water goes on, you close your eyes, and immediately you have a vision of a product that will make you millions.

 

It happens to all of us, all the time.

 

But how many of those ideas have you built? How many of the ideas that have appeared to you in a flash while you were soaping up have become real products that you created and marketed? None, right?

 

That’s probably because none of those ideas came with a detailed production and marketing plan  you could follow step-by-step. They didn’t come with a skilled team already in place. And they certainly didn’t come with funding.

 

Ideas are easy. Implementation—that’s hard.

 

That’s why you have to choose your business ideas carefully. You can have a new idea every day but turning that idea into a business takes time, effort, energy and money. It might be a year or two before you really know whether that flash of inspiration really is a million-dollar spark or just the light bouncing off a soap bubble.

 

You have to learn to filter out the genuinely winning ideas from the concepts that will break apart at the first sign of pressure.

 

There are lots of different ways to do that. You can conduct market research to see how similar products or services are being received. You can bring together focus groups and ask people whether they’d buy what you want to make. You can even use crowdfunding sites to see whether people like your idea so much that they’re willing to pay for it in advance.

 

All of those methods have value. Some of them will be essential. (You can’t build a product without doing at least some market research.) But none of them is perfect.

 

Market research only tells you how similar products to your idea have performed. It won’t tell you how your idea will perform. Focus groups aren’t made of real customers holding their real, earned dollar bills, and people never know what they want until it’s right in front of them. Even crowdfunded projects that built an audience and raised funds haven’t always generated a product. Some have raised millions on the back of an idea that turned out to be impossible to build.

 

A wild idea? Good

 

There’s a better way to measure the potential in an idea.

 

You measure its wildness. Not just how wild the idea is, but how wild you feel about it.

 

The more enthusiasm you feel for an idea, the greater the likelihood that other people will feel the same way. Not all of them will feel as crazy about it as you but some will, and plenty of others will feel just enough enthusiasm to pay for it.

 

That’s not guaranteed, of course. When it comes to picking ideas, there are no guarantees for commercial success. But the depth of your enthusiasm is a reasonably good proxy for the market value of an idea.

 

And even if it isn’t, even if you’re nuts about a concept, spend a couple of years developing it, and find that it doesn’t fly, you’ll still have achieved something awesome.

 

You’ll have had fun.

 

You’ll have spent two years building a business that made you proud and that you enjoyed building.

 

That’s another sign of an experienced business owner. They understand that they can’t predict what will happen at the end of the production process. They know they can’t control what their customers do when the product is ready. But they do know that they can control what they do—and they can control whether they’re happy as they build their business.

As you’re reviewing the ideas you dream up in the shower, don’t pick the first one you thought of. Pick the last one you’re still thinking of.

 

 

About Joel Comm

 

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As an Internet pioneer, Joel has been creating profitable websites, software, products and helping entrepreneurs succeed since 1995. He has been at the frontlines of live video online since 2008 and has a deep expertise in using tools such as Facebook Live, Periscope, Instagram or Snapchat to broadcast a clearly defined message to a receptive audience or leveraging the power of webinar and meeting technologies.

 

Joel is a New York Times best-selling author of 15 books, including “The AdSense Code,” “Click Here to Order: Stories from the World’s Most Successful Entrepreneurs,” “KaChing: How to Run an Online Business that Pays and Pays and Twitter Power 3.0.” He is Co-Host of The Bad Crypto Podcast one of the top crypto-related shows in the world and has spoken before thousands of people around the world and seeks to inspire, equip and entertain.

 

Web: https://joelcomm.com/ or Twitter: @JoelComm

Read more from Joel Comm

 

Bank of America, N.A. engages with Joel Comm to provide informational materials for your discussion or review purposes only. Joel Comm is a registered trademark, used pursuant to license. The third parties within articles are used under license from Joel Comm. Consult your financial, legal and accounting advisors, as neither Bank of America, its affiliates, nor their employees provide legal, accounting and tax advice.

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