Financial Projections Made Easy (Well, Easier)

Written on October 23rd, 2009 | Short URL: http://abcjr.me/1s

Something that seems to scare most entrepreneurs is figuring out how to do pro forma financial projections. It’s scary stuff — you really don’t know what the costs are going to be, what your sales are or how exactly you’re going to have the cash flow to make payroll even before you start. All you know is that you have a product idea, and maybe costs or the right price point. Beyond that, you’re really not sure.

I’m not a finance wizard, but I’ve pulled several pro forma financials together for various businesses. The long and short of it is, every investor/bank wants to see the same stuff — sales, cost of goods sold, expenses, net profit, etc. It’s not altogether difficult, but the process can be very intimidating.

I have some things that I’ve followed along the way below the fold . However, to get you started, I’ve developed a starter template that I’ve used on several projects (albeit with some significant edits) that you’re free to download (FinancialsTemplate.xls – 118kb). This should help get you started, but realize that it’s only a template and I don’t take responsibility for your final version.

Thoughts and tips are below the fold…

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Posted in Entrepreneurship, Funding | Permalink | No Comments |

The $100 Identity Start Up Kit

Written on October 21st, 2009 | Short URL: http://abcjr.me/1p

I don’t need to delve into the importance of a good marketing plan — it’s been said a thousand times by people far more talented than I. However, tactical implementation gets tough on a very limited budget. Folks in startups often believe that people (potential funders, customers, etc.) will look beyond design/collateral because the product/service is so superior, so they decide that creating a professional image is very low on the to-do list. However, the short-term cost savings can severely cost them in terms of funding and sales.

Having worked in a startup environment with very few resources, I was able to create some identity pieces and collateral that looked very professional for not a lot of money. I have incredibly high standards with respect to graphic design and print quality (true story: I will use a magnifying glass to look at how a piece is printed), so I have experimented with many solutions in order to maximize look on a dime (or penny, even). Here are my thoughts and some do’s and don’ts…

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Posted in Design, Entrepreneurship | Permalink | No Comments |

The Entrepreneurial Test

Written on October 19th, 2009 | Short URL: http://abcjr.me/1t

This is a cool quiz written by Northwestern Mutual that’s based upon research they and others conducted regarding the traits of entrepreneurs. I highly suggest that you take a look:

http://marriottschool.byu.edu/cet/startingout/test.cfm

While I’m not surprised by my overall score (37, which puts me two over the line for an entrepreneur), I was surprised by the scoring of a couple of the questions. For instance:

Entrepreneurs are not especially enthusiastic about participating in group activities in school. If you enjoyed group activities—clubs, team sports, double dates—subtract one. If not, add one.

I was pretty active in clubs and organizations in school (band, football, theater, and spending time with different cliques), which I would expect to breed the type of leadership skills that help foster an entrepreneurial mindset. Another:

Do you believe being an entrepreneur is risky? If yes, subtract two. If no, add two.

This really confuses me — doesn’t everyone consider being an entrepreneur risky? I obviously believe that it’s a risk worth taking, but I’m still surprised by the scoring on the question.

Has anyone else taken this survey before? What are your thoughts?

Posted in Entrepreneurship, Leadership | Permalink | No Comments |

Reactions to AlphaLab Demo Day

Written on October 14th, 2009 | Short URL: http://abcjr.me/1w

Instead of a summary of each company (Alan Veeck ( @aveeck ) at Meakem Becker Venture Capital and author of Pittsburgh Ventures blog did a fantastic live blog roundup of the companies here), I’d like to toss out some gut reactions to the companies, presentations and the feel of the environment overall.

• In monitoring local media, it seems like there has been a lot of funding activity in the region recently, from early stage angel investments to larger acquisitions of Pittsburgh-based startups. That feeling of optimism was present at the event today as well, and from the folks I was able to speak with, there might be more good news coming down the pike.
• It was great to hear about some of the success stories coming out of AlphaLab. One of my personal favorites is a company called The Resumator, led by Don Charlton ( @TheResumator). They’ve gotten some serious press and some seed funding post-AlphaLab, which is helping them to expand their feature set.
• Social is everywhere. Absolutely everywhere. It’s hard not to get sick of hearing about it, but it really doesn’t make it any less important. I’m reminded of when everyone was talking about the internet being game-changer in the late 90′s-to-early-’00s — while it was so annoying to hear, the folks saying it were absolutely right.
• The actual design of the various PowerPoint presentations was pretty good. I know it sounds superficial, but a stylish presentation makes a company look much more “together”. Great job, everyone.
• Loved the presentation by Nick Pinkston, CEO of CloudFab ( @cloudfab). I continue to believe that storytelling and metaphor are the best way to connect with an audience, and I think Nick did a very good job of doing just that. Speaking with him afterward (both about his company and about using his technology to develop some components for a project on which I’m working), it was evident that he sees this as a product customization revolution rather than simply a sourcing opportunity. I love the vision.
• Fooala has developed a site called CollegeBite ( @collegebite), a very cool open ordering platform that enables restaurants to create/expand an online presence using mobile and the web. One of the things I loved about it is that I’ve already used the site! While the presentation was a bit difficult to follow at times, I did find the team to be very, very strong. Finally, they’re classic Gen Yers –  smart, mobile, experienced, passionate, hungry and making a difference. Two of the guys are from Duke, one of whom met one of the CMU founders while in Sydney, Australia. What a story.
• Brian at NavPrescience has a compelling pitch — a software package that is integrated into GPS functionality that learns your driving habits and adjusts routing and point-of-interest suggestions accordingly. One of my favorite lines of the day was Brian’s deadpan delivery of “[GPS] devices are pretty stupid”, referring to the dictionary definition of  “slow to learn and understand”. As a recent owner of a BlackBerry Tour with GPS capability, I’ve found how dead wrong TeleNav can be with even the simplest of directions (he cited that only 35% of GPS routes are actually ‘fastest’, confirming my experience). Brian’s use of a scenario in his presentation (there’s that storytelling again) was very engaging. Things that I disliked are mostly brand-oriented — I’m not a fan of the name (I keep wanting to say NavPresence and the word ‘prescience’ is a bit SATish) and the logo is a rough (use of Verdana, complicated design and the invocation of magic when the system is built on three years of solid R&D at CMU). I know that the company isn’t looking to sell to consumers, but it’s still something that could be improved.

While it’s a tough time for everyone in this economy, I’m really optimistic about the entrepreneurial community here in Pittsburgh. Being named the second-best place to start a small business in the U.S. doesn’t hurt, either. All-in-all, I have to commend AlphaLab Class #3 on a job well done.

Posted in Entrepreneurship, Generations, Storytelling | Permalink | No Comments |

Pittsburgh Named Second-Best Place to Launch a Small Business

Written on October 13th, 2009 | Short URL: http://abcjr.me/1z

This is just great news for the region. The more people realize how economically viable this region is for small businesses, the more robust the entrepreneurial community will be. While the challenges this region faces are pretty well documented, this type of press is really important.

http://money.cnn.com/smallbusiness/best_places_launch/2009/snapshot/258.html

Update: For those who don’t want to click through…

Greater Pittsburgh is home to a workforce with hard-won manufacturing skills from the city’s steelmaking past. Need machinists? They’re here — and that’s a draw for small businesses.

The region combines that talent pool with a mix of highly educated students from the University of Pittsburgh, Carnegie-Mellon University and Duquesne University. Those institutions helped make Pittsburgh a leader in robotics, healthcare, and artificial intelligence. Locals cite the city’s culture as one of its biggest selling points: There are tight-knit neighborhoods, many built around eastern European communities that prize a strong work ethic.

Most of the city’s small businesses are family-owned concerns that have morphed to serve new markets. Resources like the Institute for Entrepreneurial Excellence help both startups and generations-old companies get the skills they need. Pittsburgh’s location on major North-South and East-West interstates connects companies with distant markets and suppliers.

State taxes aren’t low, and the recession-fueled tax shortfall hurts: The state may have to take over Pittsburgh’s pension system. But small businesses say the local workforce is resilient, and with valuable, transferrable skills.

Posted in Entrepreneurship | Permalink | No Comments |

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