It is sometimes astonishing the number of entrepreneurs that don’t plan for the future. They work their fingers to the bone, putting in early mornings and late nights to see their business grow and succeed, but they do not plan for the future. You do all of that work for years so your business becomes more valuable but there is no exit strategy for you to get your value back out. So what should Grand Rapids’ business owners do to plan?
Sam Bravata formed his small business in 1977 and saw it grow from a single Caladonia location to locations in Alaska, Caledonia, Coopersville, Dutton, Kentwood, Middleville, Norton Shores, Plainwell and Rockford. Now in his 80’s Bravata is trying exit from his Sam’s Joint restaurant chain. The problem is Bravata has not put together a solid succession plan for his eventual departure from the business.
There is a growing trend in the startup community. It often times goes undiagnosed because we are so distracted by the “cool factor”. The trend is the development of a cool idea versus developing a business. People come up with intriguing ideas all the time but all too often these ideas are not a business.
Brent Beshore, a successful and well established entrepreneur from St. Louis, recently wrote an article for Forbes expressing his disgust with the growing trend of the word “cool” in the startup community. Beshore expressed that “cool ideas” do not address a market need, do not solve a problem and, most importantly, “cool ideas” do not generate revenue.
It can sometimes be tough to adjust a business plan. Entrepreneurs, whether they own a Grand Rapids small business or startup venture, often have a vision of the path they want to follow or they think they are supposed to follow. They are on this path and they don’t take the time to step back and adjust that path because of any number of changes. Entrepreneurs should take a page out of the book of a West Michigan business assistance group.
Grand Rapids SmartZone is going through changes in its administrative structure and management due to the changes West Michigan’s economy, specifically citing the growth in Grand Rapids’ life science industries. These changes include more formalization of governing bodies and more active roles of other business support groups in the administration.
Thanksgiving is tomorrow (which The Business Law Group is really fired up about because we love Thanksgiving). In the spirit of this national holiday, we would like to tell you what we are thankful for.
To begin with we would like to thank Abraham Lincoln. It was during the Civil War that President Lincoln proclaimed there to be a day of thanks which has become the turkey laden holiday that we know today. We are thankful that we have a day to tell our loved ones that we are thankful for them (and the food is not so bad either).
We are thankful for all of our clients. The Grand Rapids startups, West Michigan small businesses and Michigan entrepreneurs are some of the best and brightest minds we have ever met. The ideas, innovation and drive that you possess is truly admirable and we love being able to assist in making sure your dreams come true.
We have discussed before the importance of an entrepreneur to put the best team around him. A team can help speed up the startup process, compliment your skills, and help take the pressure off of you. But how do you find the right members to make up your team? One of the easiest sources of manpower can be found among your friends but entrepreneurs should be cautious when teaming up with friends.
Friends can be a great resource to help you run your small business. You already have an established relationship and trust in their abilities. You also know that they have you and your business’ best interests in mind as they work for you or with you. This creates a perfect candidate to join your team but sometimes these are the same reasons we can overlook obvious flaws.
Grand Rapids startups and small businesses face the ongoing challenge of remaining relevant. Small businesses face growing competition and limited ability to grow. Startups might be able to convert their idea into a business but very few businesses survive on a single product and eventually competition will develop. The only way for these West Michigan businesses to survive is through innovation.
There is one issue that entrepreneurs need to avoid and that is taking on too much risk with their innovations. While new ideas might have a huge upside, the risk they carry can harm your business that already exists.
One of toughest obstacles for science startups to overcome is the great expense that comes from having to have your own lab. Research institutes and other similar facilities are not generally big fans of renting out space or housing entrepreneurs. But at the same time entrepreneurs working in the science industries often need a lab. With pieces of scientific equipment priced into the hundreds of thousands of dollar range, it’s not viable for most entrepreneurs to create their own lab. West Michigan scientific entrepreneurs now have an alternative.
Kalamazoo, Michigan’s Southwest Michigan Innovation Center unveiled its new core wet lab, complete with centrifuges, nitrogen generators, autoclaves, incubators and mass spectrometers. The new 2,300-square-foot wet lab allows entrepreneurs to rent as little as four to six feet of bench space for several days or weeks to test out new ideas. This allows scientist access to the space and equipment that is necessary for their innovations but without the high price tag.
One of the fastest growing startup and small business funding methods is crowdfunding. Websites like Kickstarter are fraught with entrepreneurs pitching ideas from gadgets to music careers to food. While some of these sites limit the products that can be pitched, they generally allow for entrepreneurs to get the funding they need to put their innovations to work.
When Grand Rapids-based Rowster New American Coffee decided to expand its high-end roasted coffee operation it turned to Kickstarter for the funding. The off-chute company known as Regular Coffee Company will allow customers to become members that can get high-quality coffee for regular prices as well as have access to special information about the coffee and other special discounts. Regular Coffee beat its fundraising goal of $10,000 by providing donors with anything from a hand-written note — for the $5 level — up to one-year subscriptions to Regular Coffee and other gifts.
As a West Michigan startup company life and survival are not easy. Your innovations could be revolutionary but that does not always equate to automatic success. Often times your idea’s future might hinge on how well you are able to sell you, your business and your innovation.
Entrepreneurs all have to have business plans and elevator pitches that they use to sell others on their startup. These are entrepreneurs’ only tools to sell potential investors, partners, employees, mentors, and development partners on their ideas. These tools vary greatly from startup to startup. Not all business plans are created equal.
It’s one thing that all small business and startup companies all hope to avoid: the dreaded time that you have to sue someone or are getting sued. There is a reason why attorneys have garnered their reputations, there are so many lawyer jokes and why Shakespeare said, "First kill all the lawyers." Those hundreds-of-dollars-per-hour fees mount quickly and can weigh heavy on any business owner. So what can you do to avoid these high bills?
1. Make sure your business contracts are solid
In the world of business, relationships should be defined by the terms of a contract. You should have contracts between your business and customers, clients, vendors, suppliers, and employees. These contracts should also be drafted to fit your business specifically too. That way if a dispute arises the terms of the relationship are clearly defined and the situation can be resolved quickly.