Guest Post #4: Small Business, Big Brand by Sean McCarthy of Digital Marketing NOW

Small Business, BIG Brand!

By Sean McCarthy, Director of Client Strategy, Digital Marketing NOW

In case you haven’t noticed, there’s a little tournament going on in Brazil this month and with it has come some of the most creative (and expensive) advertising on the planet. Whether you call it football, futbol, or soccer, global brands such as McDonald’s and Nike are sparing no expense to put their brands on your television, in the World Cup stadiums, and on billboards around the world. Even emerging brands like Beats by Dre are creating five-minute long mega-commercials with global stars of the sport to grab your attention.

If you’re the owner of a small business, what should be grabbing your attention is their branding. While I’m sure you don’t have the budget of a big brand, that doesn’t mean you can’t act BIG when it comes to the branding of your small business. If I say Nike, I bet a Swoosh just popped into your head. What emotion does Coca-Cola evoke? That’s easy, happiness. And if I asked what Budweiser’s slogan was, I’m sure you’d answer King of Beers. All this greatly influences what people buy, and it comes from years of successful branding.

Here are eight tips for how you can do BIG branding for your small business, just like a mega-brand.

  1. Define Your Brand – Who are you? Most small businesses try to explain too many things in their branding. Think of VISA, “It’s everywhere you want to be.” Simple and let’s people know VISA is reliable, accessible, and can be used anywhere. In fact, they just removed “It’s” from the slogan earlier this year, because it better represents the brand. Define the essence of your brand, as it should inform all of your marketing.
  1. Take a Stand – Consumers connect with brands they can understand and appreciate. If you try to be everything to everyone, your message can and will get lost. Let customers know what you’re great at or what you’re passionate about. For example, Budweiser: they are the King of Beers. Tom’s Shoes are passionate about helping the poor and underprivileged have footwear. Let potential customers know what your brand DNA is all about and let them connect with it.
  1. Be Bold – “Just do it.” In three words Nike connected with every aspect of your life by telling you to be bold and by being bold themselves. Don’t be afraid to make big statements in your branding. If your product can empower consumers, let them know. If your product can save consumers time, let them know. Don’t be afraid to be bold and aggressive in your brand messages.
  1. Pick a Color – Big brands have simple colors and they use them consistently. If I said the name Home Depot, Starbucks, IBM, or General Electric, I’m sure you could tell me their primary brand color. An accent color here and there is fine, but big brands want you to think of one color and identify with it always.
  1. Be Consistent – Whether it’s your brand slogan or the color of your logo, be consistent. The VISA campaign I mentioned earlier has been running since 1985! You can’t reinforce the character of your business if elements of your brand are constantly changing.
  1. Keep It Simple – Caterpillar is one of the largest heavy machinery companies in the world manufacturing massive, expensive, complex construction machines. If you go to their website though, you’re presented with four simple verticals and even a “Need a part” search feature. Big brands don’t overwhelm their customers; they help their customers meet a need. A startup called Buffer began in the bedroom of one of its founders with a simple product offering social media post scheduling and nothing else. Everything the company does has been focused on simplicity. Three years later Buffer had 700,000 monthly blog readers and over 1 million users! Keeping it simple works, whether you’re a large company or a solopreneur.
  1. Promote Your Expertise – Marketing is expensive. Marketing on the level of a global brand is astronomically expensive. However, you don’t need a billion dollar budget to set up a blog; all it takes is time. The software startup KISSmetrics built its blog religiously (without spending money) and took it from zero monthly blog visitors to 350,000 in just a few years! The blog now accounts for 70% of the company’s leads. Consistent blogging can serve multiple functions from sales to customer service resource all while establishing your brand as a thought leader in your industry or area. Whether it’s introducing a new product feature or giving your point of view on the latest industry news, consumers connect with stories and a blog is a great way to tell yours. And it’s free!
  1. Analyze This – Big data, small data, stats, information; whatever you want to call it, big brands spend a lot of time and money analyzing customer data. As a small business, you have neither the time nor the money. But fear not, there are free tools! First, Google Analytics is free and there are very simple reports that can be set up rather quickly to help you understand how customers are interacting with your website. This can help you identify pages with high bounce rates or low time-on-page to improve customer experience and better convey your brand message. Second, another free platform to track data is Sumall.com which allows you to integrate basically all of your web services into one analytics dashboard. From Twitter to AdWords to Ebay, you can see it all in one interface saving time and money while getting a big picture view of how your brand is performing.

Remember, big brands weren’t always that way. So while you can’t afford Ronaldo or Messi for a commercial right now, you can still use many of the same branding tactics these mega-brands use to make your small brand BIG!

To learn more about Digital Marketing NOW, visit http://DigitalMarketingNOW.com.

Guest Blog #3: Online Video: Do you need one? by Alan Catello Grazioso

Online Video: Do you need one?

By Alan Catello Grazioso of Grazioso Pictures, Inc.

Yes, it’s the golden age of (online) video.   YouTube and broadband changed the world of video distribution.  Created in 2005 by three former PayPal employees, YouTube users today upload a 100 hours of new video content every 60 seconds. Perhaps you’re thinking…do I need a video from my company, product, pitch or service?  And how do I get started creating one?

Image_1of2_Grazioso_Blog_June16_2014

In today’s world, our web presence is one way small businesses can “compete” with larger players.  An effective video can showcase your company, product or service and do the boasting for you.

I’m an entrepreneur and video producer (a.k.a. digital filmmaker).  I launched my production company 14 years ago and have been creating video content for broadcast television and companies for nearly 25 years.  I’ve seen media creation technology and distribution change dramatically, one seismic shift being the explosion of online video.

Over the last 5 years our online video projects for clients (not including broadcast projects) have taken us on location to 5 continents, including such places as Ethiopia, Rwanda, El Salvador, Vietnam and Israel, producing projects in 12 languages.  I’m grateful to have had these opportunities and thank online video as a result.

Video Development

In my experience the #1 constant common denominator that separates a good video from great one is a compelling, well structured story.   #2 is sound and music. #3 is image quality. Here are some things to think about when developing a video idea:

-What ways can my video be utilized and fully exploited by my company online and offline?

-What’s the story?

-How will you tell it? (interviews, voiceover, on-camera talent, fiction, documentary)

-What’s unique about your company, product, service?

-Who’s your audience?

-What’s the length of the video and how did you come to this conclusion?

-Why will viewers want to watch your video past the first 10 seconds?

Image_2of2_Grazioso_Blog_June16_2014Before Shooting:

Here are a few of my cardinal rules to consider before shooting any video.

-Have a game plan in place before you shoot: Take the time to “flesh out” your concept and game plan.  This will help you avoid a lot of pain when it comes to editing.  Do you want the piece presented by a host, narrated off-camera or told solely by the interview subjects?  Do you want to use professional actors or your employees?  What tone, feel or approach will the film take…serious, comical, dramatic?

For inspiration, a YouTube video that stands out to me as super creative is this video from DollarShaveClub.com.

Create a shooting outline, video treatment, and/or script prior to scheduling your production.  Work out the idea on paper first.  Talk about it amongst your team and brainstorm.  In addition to creating a shooting script, make a storyboard. This will help you visualize the final product.   I storyboard all my videos by going online and doing an image search.  For example, say shot #1 of our script starts with wide shot of South Boston, I’ll find the best shot online and paste it into a word doc. From this storyboard you can easily create a shot list.

-Cast your “characters”: We produce a lot of non-fiction television, including “reality” or “real life” shows.  Casting is a major part of the process.  Think about who you want to appear on-camera. Hiring a casting company is money well spent, but you may not have cash for casting.  It’s okay… if your vision is to include someone from sales, conduct a formal or informal casting session.  Pre-interview people you think may be good candidates.  Test them on camera with your smart phone and pick the best person.  Keep in mind candidates may interview well (off-camera) but may clam up when the camera is rolling.

Viewers respond to the on-camera energy of a person.  Not to sound corny, but when I say “energy” I mean camera presence.  If a person on-camera is nervous or checked out viewers (I believe) can sense it and will likely tune out also, so casting is critical.

-Think about technical execution:  Yes, videos can be shot on an iPhone (and many have) but one huge distinguishing fact between good and horrible videos is sound.  It’s been said that sound is 50-60% of the experience of the television watching viewer and that audio trumps image quality.  This is debatable, but if watchers hear bad sound they will tune out.   Invest in recording good, clean, crisp sound.  Sound and image quality do make a difference so think about what you want to create in the end.  This brings us to the budget.

-Budget and resources:  You have no budget you may say.  Think long and hard on why you want to make a video.   One goal may be to get press interest, or get invited to appear on Shark Tank.   Regardless, creating a video will take resources.  Perhaps your cousin is an actor (and has talent).  Perhaps your neighbor owns a hair salon and one of your scenes can take place there after hours for no fee.  Who’s going to film it? With what camera? How are you going to record sound? What’s your editing plan? Do you need animated graphics to give it that higher end feel?

In conclusion, there’s a lot to think about when it comes to considering making a video.  Why? What? How? When? For whom? How long? We are in the midst of the golden age of online video and with planning, creativity and some resources you can make a great one.  And hey, it may get you 10 million views on YouTube as a result!

Alan Catello Grazioso is a member of Workbar and the head of development and executive producer of Grazioso Pictures, Inc., a fourteen-year-old production company based outside of Boston and represented by N.S Bienstock, Inc. in NYC.  His credits include BBC, History Channel, Travel Channel, PBS, Oxfam, Save the Children, BMW, L.L. Bean, Southwest Airlines, Domino’s Pizza, New Balance, and others. 

To learn more about Grazioso Pictures visit: www.graziosopictures.com

To see Grazioso Pictures lastest demo reel visit: http://vimeo.com/59703490

 

 

Guest Blog #2: Employee Equity Need-to-Knows, by James Johnson

What You May Need to Know Before Granting Employees Equity

If you’ve decided to grant your employees or other workers or service providers—such as independent contractors, attorneys, accountants, or advisors—with equity compensation or incentives, you’ll need to make several decisions about what kind of equity you want to give, and take several steps to put a compensation/incentive plan together and ensure legal compliance.

Types of Equity Grants 

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“City government stock certificate” Seattle Municipal Archives. Creative Commons License 2.0

Employee equity compensation grants can take one of several forms. Grants can take the form of restricted, or “vesting,” equity, as well as options to purchase stock/equity. In addition, the exact nature of the equity can depend on how your company is structured — if your company is a LLC you may grant membership units, or if your company is organized as a corporation you may grant stock, often with different rights than other classes of equity.

Restricted Equity

With restricted or vested equity, employees are restricted from transferring the stock until it “vests” after a period of time or upon the occurrence of an event (such as a product launch or revenue milestone). The employee typically holds the equity and is entitled to exercise any rights associated with the equity. However, if the employee leaves or is otherwise severed from the company before equity vests, the unvested equity is forfeited or repurchased by the company.

Restricted equity grants can sometimes be simpler to construct and simpler to tax. Normally, the employee reports the difference between the price paid for the equity and the fair market value of the equity at the time of vesting as ordinary income. However, the employee can choose to pay tax at the time of grant rather than at the time of vesting. Paying the tax at the time of grant can allow the employee to avoid a larger tax bill if the value of the equity rises between the time of grant and time of vesting, but the employee takes the risk that the equity decreases in value, or that he or she forfeits unvested equity — any paid tax is not refunded.

Options

Options allow an employee to purchase equity at a stated price. The option to purchase is also usually subject to a vesting period or condition; once the option vests, the employee then has a set limited period of time, normally 5 to 10 years, to exercise the option. Options fall into one of two categories: incentive and non-qualified options.

Incentive Options

Incentive options give exercising employees certain tax benefits, assuming certain qualifications are met. Tax benefits of incentive options can include no ordinary income tax on exercise; however, in practice it’s often difficult to meet the requirements for incentive options, and employees sometimes end up with unexpected tax liabilities.

Non-Qualified Options

Non-qualified options are all options that are not incentive options. Generally, the options are taxed to employees as ordinary income, and companies are permitted to take deductions on the exercise of non-qualified options. They are generally considered simpler than incentive options since they can be granted to all individuals who provide bona fide services to the company, as opposed to incentive options that can only be granted to employees. Employees need not worry about holding periods or tax liabilities, since estimated tax payments are usually withheld at the time of exercise.

Making Equity Grants

Companies have certain regulatory requirements they must comply with in order to implement equity compensation/incentive plans. All plans should be codified in a written document, approved by the board of directors and shareholders. If the company is granting a security, it normally will conduct the offering of the grant pursuant to exemptions in the securities laws.

The Incentive Plan

The incentive plan describes the employee equity being offered by the company, including the size of the plan and the types of equity being offered, how and by whom the plan is to be managed, eligibility, vesting terms, length of the plan, exercise price, and/or potential cash options.

Securities Compliance

Employee equity compensation/incentive plans must also comply with securities laws. Typically, companies utilize the Rule 701 exemption at the federal level; companies must also comply with securities laws in the states where the plans are offered.

Rule 701

Rule 701 exempts from federal securities registration equity compensation offerings pursuant to a written compensation plan. The company does not have to make a filing in order to comply with Rule 701, but it must provide offerees with a copy of the compensation/incentive plan, and, depending on the size of the plan, must also make certain disclosures, including a summary of the material terms of the plan, information about the risks of investment, and certain company financial statements.

State Securities Laws

Rule 701 does not preempt state securities registration, so companies must ensure compliance with state law. Fortunately, most states have exemptions for employee equity compensation offering, normally requiring notice filings to the state securities regulator and disclosures to the plan offerees.

If you have any additional questions, don’t hesitate to reach out or catch me around Workbar!

James Johnson

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Disclaimer: This post is for informational purposes only, and does not constitute legal advice nor create an attorney-client relationship. Please contact an attorney for advice specific to your situation.

Guest Post 1: Workbar Member Mike Moore Discusses Valuation

Working in both big and small companies, I’ve noticed that there is a LOT of confusion, stress and misunderstanding around estimating the value of a company. I’ll let you in on a little secret though, it’s simpler than you might think. There are three main questions your need to address:

  1. What value do you produce?
  2. What’s the “risk” of not delivering?

And MOST IMPORTANTLY

  1. Can you tell a compelling story?

Value –

As an entrepreneur, this SHOULD be the easiest thing to determine.

Ultimately it boils down to what do you sell/make/create that other people are willing to pay money* for. Being able to define what this value is should allow you to project out what your cash flow will be, per example:

  1. Jumpshell – The authority on how to find apartments in Boston
  2. Cater 2 me– Provides of the best hand-selected food delivered effortlessly to your office.
  3. DraftKings – Daily fantasy sports leagues for money

*But, wait Mike, what about companies that don’t make money now? (eg – Twitter, FourSquare, Google [just kidding on that one, wanted to make sure you are paying attention])…don’t worry I’ll get to those down below, but trust me, ALL companies are about making money in some fashion.

Risk – What are the chances that you (your company) doesn’t produce value?

Risk? What Risk?!?!

I’m sure as an entrepreneur you don’t see risk, you see opportunity and growth, which is awesome. That said, most of us have had seen a Hockey Stick Curve before, and know that there is virtually 0% chance that a projection will be perfect. What does that mean?

It just means there is uncertainty (risk) that whatever you are projecting, and you need to account for it. Luckily for you most industries or have industry standards or other companies you can use to get a sense of where to start.

Google, and a little creativity are probably your best resources, but here are some shortcuts on valuing risks:

Discount Rates– Basically, a discount rate is the amount of return an investor would expect to get in return for giving you money.

The higher the rate, the bigger the risk the company won’t be able to deliver on its projections.

Discount rates are most useful for companies with a track record of financial returns, because they are more stable and “easier” to predict.

Revenue Multiples Revenue multiples are also a common way to estimate value. This approach is consists of taking the Revenue (or EBITDA if you want to get technical) of a company for a period of time (usually a year) and applying a number to that revenue figure (e.g. – $1 Million in Revenue at a 10x multiple, would be worth $10 Million).

Revenue multiples are useful for high growth/early stage companies. It is simpler to use an industry benchmark versus as opposed to trying to get a discount rate that accounts for all risk factors when they can be largely unknown

ComparablesTo come extent you use Comparables, for your discount rate and multiples valuation approaches. In theory, these three should lead to a similar value (if it isn’t you just need to be able to justify why).

Cost – Using the cost method, just means that the company is worth exactly what you paid for the individual parts. This is generally used more for accounting purposes, otherwise that means you aren’t adding any value.

No Revenues, no problem – If you are valuing a company with no cash flows it’s more of an art than a science, but basically you need to find some proxy for how you provide value (e.g. – customers, market share, time on site, etc.) but for more detail Aswath Damodaran NYU Professor of Finance does a much better talking on the subject in this video. Which leads me into the last and most important part of valuation…

 

Storytelling – Can you tell a compelling story on why your company will grow?

Are you still feeling a bit uncomfortable about throwing together a valuation?

DON’T!

NO ONE KNOWS with 100% certainty what a company is worth and there have been countless examples mis-valuing companies for example:

Yahoo! wasn’t able to find search results for Google being worth more than $1 million,

Blockbuster was completely shocked by Netflix’s surprise ending, and

I’ve made more profits playing poker at Workbar than the US airline industry has since it started

The real key to valuations is being able to sell your value proposition to your audience by telling a compelling story, with the support of both numbers and words.

At the end of the day, your company is only worth what other people are willing to pay for it.

Hope that helps and if you still need help with valuation or financial modeling, just give me a shout.

Thanks,

Mike Moore

 

Political and Civic Engagement Should Be in Your Business Plan

01 (108)Any good business plan includes financial projections, market analysis, growth strategy and a marketing plan, but it’s rare to see a strategy for local civic and political engagement included in a pitch deck.

Time to update your plan!

Your business does not exist in a vacuum. Local government and other civic institutions have a direct impact on your work. You can ensure that their impact is positive by building a relationship with your city and state, or you can court disaster by ignoring them.

The good news? Your elected officials are dying to hear from you because they need your help to avoid debacles, like the Tech Tax in the Commonwealth of Massachusetts.

This summer, Massachusetts tech companies were blindsided by a plan in the State Legislature to expand the 6.25% sales tax to include software services.

6.25% of a key industry’s revenues…poof…up in smoke. Thankfully, a concerted organizing effort, led by the Massachusetts High Technology Council and supported by the tech community, pushed the Legislature and Governor Patrick to repeal the tax.

The lesson to draw here is that your interests are a mystery to lawmakers unless you make them known. Tech companies and legislators alike would rather see collaborative efforts like Boston’s Innovation District than a new Tech Tax. You can help make that happen through engagement.

Boston City HallWith a brand new Mayor Walsh coming into office in Boston this January and a gubernatorial election coming up in 2014, now is a perfect time to start.

Here are some steps you can take immediately:

1. Budget time, effort and sometimes money to knowing your political, social and civic environment:

Who are your Mayor, City Councillor, State Rep and State Senator?

Does your industry have a trade group?

Who are the leaders in your industry and what is their engagement with policymakers?

2. Educate yourself on the government issues that impact your business:

Are there any legislative efforts underway related to your industry?

Which elected officials are advocates for your work?

3. Get to know your elected officials:
IT Phone Call

Call your City Councilor and State Representative and introduce yourself.

Invite them to your office and teach them what you do.

Make sure they know  about your vision and priorities, and about what issues you face as a business in Massachusetts.

4. Communicate regularly:

When you have news, send it to your State Rep, Senator, City Councilors and Mayor.

If something needs fixing, let them know.

5. Get active:

Find candidates for office who share your views on important issues and support them.

Take on leadership roles in your industry organizations.

Meet others in your industry and share experiences.

Apply your products to problems here in Massachusetts.

This month, I’m putting my efforts where my mouth is and starting a Workbar Political and Civic Group. We’ll meet once a month and discuss issues in our industries, which we will then communicate to our state and local governments.

Through this effort, I hope to keep the public and our elected officials informed about innovation in Massachusetts and engaged in supporting it.

Want to help? Email me at Devin [at] Workbar [dot] com!

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About the Author: Devin Cole is the Director of the OuterSpaces program at Workbar. Contact him via email devin@workbar.com or Twitter @devincole.