God Help Us . . .

“God grant me the serenity to accept the things I cannot change; the courage to change the things I can; and the wisdom to know the difference.”
–Reinhold Niebuhr, The Serenity Prayer

Powerful stuff: Alcoholics Anonymous started using the Serenity Prayer in the 1940’s, according to thisarticle. There are even stickers that sell on ebay with a similar message.

So, how about an entrepreneur’s prayer? (hopefully, most of you won’t need a prayer). I’m thinking something like:

God grant me the serenity to accept the fact that some markets cannot be changed; the strength, energy and courage to execute ideas in the markets that I can change; and the wisdom to know the difference.

As entrepreneurs, we need to constantly push ourselves to do 3 things:

1. Don’t launch businesses that require our customers to do something unnatural, and don’t address markets that no one cares about. The iSmell, for example, was a USB device that was supposed “smell-enable” the web. (Here’s a list of the 25 worst tech products of all time, according to PC World)
2. Free our ideas. Launch businesses based on our good ideas. If we don’t have time to execute them, then share them on idea markets like Cambrian House. Feel free to roll your eyes the next time someone tells you that they “thought of ebay a year before it launched”, but didn’t get around to creating it because they were too busy. Also feel free to avoid people who think that their ideas are so good, that they would have to kill you if they told you. Zefrank has named the concept of trapping ideas in your brain so that you can feel good about yourself “brain crack” [WARNING: coarse language].
3. Support an outrageous idea every so often. Fred Smith‘s business plan was given a C at Yale, because his professor didn’t think that it would ever become a viable business. Good thing Fred stuck with it – this would be a much different world without the company he founded, Fedex.

Lifting Membership Numbers On Your Site

When was the last time you were asked to fill out an application form before entering a department store? Well, if we were to equate e-commerce sites with bricks and mortar stores, I’m sure we would make the sign-up process at most websites a lot less painful. Contrast that registration form with the one at versiontracker, where all they require is an email for a ‘basic’ account.

Google gets it, but Flickr doesn’t. iStockphoto also has one of the best sign-up flows out there. LinkedIngets top marks, because it allows you to sign up in minutes, then incentivizes you to add to your profile later – with a progress bar. Nobody wants to have low marks!

 

Take a look at your favorite sites: do they turn you away at the door? Or do they invite you in to browse, and ask for your name after you’ve had a look? All sites with lengthy sign-up processes need to adopt the following best practices:

1. It’s a numbers game: the first goal should be to capture the name or email of everyone visiting the site. Versiontracker is the clear winner here.
2. Don’t make customers wait: It’s 2007, and they’ve had this thing called ‘AJAX” for a while – use it. Why do some registration forms make you submit multiple times, only to tell you that you can’t have the member name that you want? iStockphoto does a great job here, checking both the member name and email address in very short registration form.
3. Ask for more information later: as marketers, we’d love to have every piece of information about a registrant. However, it’s not going to happen, so don’t fight it. Working under the principle that some information is better than no information, create different levels of membership and try to grow the population at all levels. For instance, level 1 might contain only email addresses, but level 10 would contain everything. Understand that you must gain the user’s trust and offer clear benefits as trade for this information. LinkedIn is best in this category.
4. Announce the steps: If a 5-step registration process is required, telling people that they’re on step 2 of 5 isn’t good enough – describe what all the steps are up front. Doesn’t this seem less painful than being dragged down a long registration path where you might not feel like answering the questions in the last step?

The Revival of Old Media.

The death of traditional media has been discussed ad-nauseum. Sure, Craig’s List is putting a hurtin’ on classified ad revenues for newspapers, but all the newspapers I get are still filled with advertising and full-color inserts. As the traditional mediums fall out of vogue, I know that smart marketers will find a way to use TV, radio and newspaper to drive traffic to the web. Google has already been working on it for the last year. Guy Kawasaki‘s best blog entries will be published in Entrepreneur Magazine, again, driving traffic from print to the web.

In 1994, when I was working for Adobe’s Image Club Graphics division, the Internet was still in its infancy. We sold clip art, fonts, and photographs through direct mail (DM) catalogs, and at our peak, we mailed over a 1,000,000 catalogs a month. Those of you familiar with DM would not be surprised to hear that a 2% response rate is fantastic (that’s about 980,000 catalogs that get ignored!!). Those of you who aren’t familiar with DM are appalled at the waste and the harm to the environment. Many people back then had concluded that paper catalogs would become extinct. Some had predicted the death of paper entirely.

When Victoria’s Secret mails 400 million catalogs a year in the U.S. – that’s 1.33 catalogs for every American citizen – is it because they have money to burn? Hardly. Being an effective direct marketer requires that you have some quants in the back office. They constantly monitor response rates and calculate regressions, because just an extra one-tenth of a percent boost in response rate makes a huge difference to the bottom line. This Business Week article highlights the numbers:

• 2005 percentage of revenues from online/catalog sales: 28%
• 2005 online/catalog revenue growth: 10%
• 2005 in-store revenue growth: 4%

The “secret”? Use catalogs to express your brand and highlight products, but send detail-seekers and orders to the web. Case-in-point: Image Club used to sell over 50 clip-art different volumes collections, some with over 200 individual images in each volume. Because of space restrictions, we could never show more that 20 or 30 images from each individual volume – and those that we showed were tiny. As the web evolved, we simply showed 3 – 5 images, and asked our potential customers to look on the web for the rest of the collection.

The second “secret” is to ensure that the costs and sales from catalog and online are combined. Why? It would be unfair to burden the catalog budget with all the costs, but none of the benefits. You see, when you call an 1-800 number to order something from a catalog, the operator usually asks for a referral code from the back of the catalog. That links your order to a specific group of catalogs (and gives the quants in back office some data to work with). Since online customers rarely enter referral codes, it’s impossible to tell exactly how many orders came as a result of the DM campaign. If the budgets are separated, the catalog budget will get cut simply because it appears to be under-performing everything else.

I love how trackable PPC advertising is, and back in the day, loved DM catalogs for the same reason. Though response from catalogs is less trackable in today’s world, smart marketers will treat their DM budget as part branding, and part cost-of-sales (like buying 100,000 or 1,000,000 somewhat expensive keyword clicks in one shot).

Several business venture thoughts arise here. First, could an online business hire some DM quants to optimize their marketing strategy? As PPC costs rise, I see huge opportunities in this. Second, would consumers read and respond to a DM catalog full of advertising for online businesses? If so, companies like Yahoo and Google could really expand their reach. So much for the death of paper . . .

A Calgary Tech Conference??

UPDATE: A Calgary DemoCamp and a BarCamp have been scheduled. Read this for more info.

It’s obvious why we have to pay thousands of dollars to attend tech conferences in the Bay Area – TheWeb 2.0 Summit, Adaptive Path, Community Next, and The Future of Web Apps, to name a few. TheChurchill Club also puts on a great show. The Valley is where all the money is, where all your big partnership deals are going to happen, where Stanford is, and where a lot of the talent lives.

Could we hold a viable tech conference in Canada? Sure, we have Banff Venture Forum, Canadian Venture Forum and the like, but they lack Internet-based tech. My answer is leaning towards “no”, but after a conversation with Zero Knowledge (now Radialpoint) founder Austin Hill, I started looking into this. There’s some really interesting stuff happening in the east, and I have also heard some buzz fromTechVibes in Vancouver.

Here’s what I’ve been able find for tech events in Canada so far;

• Mesh
• Canadian University Software Engineering Conference (CUSEC)
• Startup Camp Toronto 2007
• DemoCamp Montreal (courtesy Fred Ngo)
• Open Cities

The last few are organized as “unconferences” – maybe that’s a good starting point for Calgary.

Venture Prize

I’ve been asked to help judge the final entries at Venture Prize, a business plan competition offering $180,000 in prizes. While I’m somewhat skeptical of government funded entrepreneurial ventures, this is a chance to see how one of these events works up close.

Guy Kawasaki blogged a list of things we could do to kick Silicon Valley’s butt (seriously, he mentions Alberta in the article!). On his “Do” list, he mentions focusing on educating engineers, encouraging immigration, and sending our people to Silicon Valley to get trained. On the “Don’t” list, he mentions focusing on creating jobs, tax exemptions, government sponsored venture funds, and cheap office space. In other words, build Stanford University in your city and you’ve completed 90% of the task. Food for thought.

Looking For A Deal.

The number one question I get these days is “What are you doing nowadays?”. If I’m feeling comedic, I stare at my shoes and answer “I’m unemployed”. Nobody ever accepts that answer, and that’s when I have to recite my resume (click on the “about” link in the left column).

Truth is, I’ve been offered a lot of opportunities over the last 8 months – from advisory board positions to consulting gigs to full-time jobs. About 50% of the companies looking for my expertise are also looking for a substantial investment. (That’s in addition to the companies that are simply seeking investments alone.) While I’ve had the chance to speak to many credible entrepreneurs about their ventures, I still haven’t found the perfect fit yet.

So, the serious answer to the original question posed is that I’m doing a few things:

• dedicating more time to my family
• working with my favorite charities
• speaking at various events on my experiences at iStockphoto
• researching my own “stealth” projects
• discovering new opportunities

So far, there’s been no shortage of deals and opportunities to review. However, there’s always room for more. Ideally, I’d love to work on a few small ventures with super smart people. Something where a modest group of employees can change the world, like Craig’s List. And even though I have an MBA, I love Paul Graham’s approach of not asking for a business plan, instead asking for critical questions to be answered.

That’s a rough idea of what I’d like to work on. Want to collaborate? Send me an email [pat (at) lor.vc] with your plan/proposal, or better yet, with answers to some of Paul Graham’s critical questions. If we decide to meet, coffee/lunch is on me!