The Entrepreneurial Mind

The ideablob.com team talked to one of our classes about viral marketing.

Just like "word of mouth", viral marketing doesn't just "happen." It is an intentional strategy. Viral marketing campaigns work, according to Ami Kassar from ideablob.com, because of two things.

First, you need a hook. People need a reason to spread the word about your business. With ideablob.com the main hook was the prize that people could win for the best idea. It is also a cool site to play with.

Second, you need to tap into the need that people have to connect with one another. For ideablob they found a way to help entrepreneurs connect with each other. Entrepreneurship can be quite a lonely pursuit.

Viral marketing never just happens -- it must be intentional and must resonate with your customers.

Posted by Jeff Cornwall at 01:33 PM | Permalink

In the discussions between our Belmont entrepreneurs and the ideablob.com team last evening, the topic centered on the value of getting multiple perspectives when facing a decision -- of seeking wise counsel from people with experience and expertise. Seeking counsel is one of the practices that Mike Naughton and I talk about in relation to the virtue of prudence in our book about being a good entrepreneur titled Bringing Your Business to Life (due out later this spring). Prudent entrepreneurs are good stewards of the resources available to them for their businesses, including investment and other start-up capital, employees' labor, customer trust, and so forth.

Seeking counsel is never more is never more important than when considering whether to launch a new business and how to best position it for market entry. Aspiring entrepreneurs should not seek out only those who act as cheerleaders to their dreams. Find people with expertise and experience who are willing to bluntly tell you the flaws and weaknesses in your plans. My students call this being "Cornwalled" when I offer my honest assessment of their ideas and plans. I always encourage them to seek more perspectives than mine. More than once I have failed to see the wisdom of a new business idea!

One of the things I like about ideablob.com is that it is creating a forum that dramatically widens your circle of people who can offer counsel on new ideas. Many of the people who frequent the site are passionate about entrepreneurship.

Seek wise counsel on your ideas from several people with different backgrounds. Listen to their counsel -- never argue. Reflect on all of what you here and look for common threads that you can use to make your idea stronger. It will improve the odds that your idea is really a good business opportunity, that you will position it properly when you launch, and that you will realize the success that you dream of.

Posted by Jeff Cornwall at 05:54 AM | Permalink

The ideablob.com team is here at Belmont tonight and all day tomorrow.

They are hosting a get together at Bongo Java this evening and will be speaking in our classes all day tomorrow. If you're in Nashville come on over to Bongo Java tonight!

I'll blog more on their visit tomorrow....

Posted by Jeff Cornwall at 06:39 PM | Permalink

There is a growing perception that American entrepreneurship is simply about getting rich no matter how it is done and no matter what the costs. I call this "entrepreneurship on steroids."

Watch this short YouTube video about an English entrepreneur and listen carefully to what he has to say about American entrepreneurs toward the very end of the clip.

Wealth is a good thing. It can create good outcomes for the entrepreneur, his employees, his investors, his community. But it should never be viewed as the only measure of success. For many entrepreneurs it is not even the main yardstick they use to measure their success.

What we don't need in the world is a bunch of narcissistic, one-dimensional, entrepreneurs "on steroids."

(Thanks to Jeff Williams for passing this clip along).

Posted by Jeff Cornwall at 07:43 AM | Permalink | Comments (1)

Barry Moltz's long awaited second book, titled Bounce, has finally arrived. From his website:

Conventional business wisdom tells us that there is always something to learn from failure. Not true--sometimes it just stinks! Failure that offers no real learning value becomes a big jolt to the basic business belief system.

Barry's gift is that he uses humor to offer lessons that all entrepreneurs can learn from. During his last visit to Belmont, Barry offered some glimpses of what he planned to explore in his new book. Just like with his first book You Need to be a Little Crazy, this book is a must read for entrepreneurs at any stage of their development.

Barry demonstrates that developing the resiliency to 'bounce" through these cycles determines who ultimately will succeed. Using real life business examples, he shows that with true business confidence, we can face our fears, let go of shame and failures, use all our choices, be better risk-takers, and define our own brand of success.

Barry offers advice on how to use the potholes, detours, and wrong turns along the road that is our our entrepreneurial journey to reach our ultimate goal of entrepreneurial success.

Posted by Jeff Cornwall at 06:53 AM | Permalink | Comments (1)

The Global Small Business Blog has a Q&A with Elaine Allen of Babson College who is the research director of the Global Entrepreneurship Monitor (they publish regular surveys on entrepreneurship featured in this blog). Here is a sample of her comments in this insightful interview:

Reasons for the US continuing high rate of entrepreneurship can be partly explained by cultural values but economically it probably has to do with some of the lowest levels of perceived ‘red tape’ involved in starting a business and also the lower cost involved in starting a business in the US compared to other high-income countries.

Posted by Jeff Cornwall at 06:43 AM | Permalink

Smart Money has a feature by Diana Ransom on the growing trend of creating incubators and hatcheries on college campuses to help attract and support student entrepreneurs. The article highlights several programs, including ours here at Belmont:

Three years ago, Andy Tabar, then an 18-year-old college freshman at Belmont University in Nashville, Tenn., started up the first iteration of his web-development company, Bizooki, with less than $1,000 and a little bit of know-how.

To help get his business off the ground, Tabar applied for membership to the university's "hatchery" called the Practicing Student Entrepreneur Program. Through the hatchery, which began in 2004, Tabar and about 70 of his fellow fledgling entrepreneurs have access to desks, computers, phones, fax machines and copiers. Students can bounce business ideas off of seasoned entrepreneurs in residence at the university, as well as seek out free marketing advice and accounting help.

Students also can apply for need-based seed funding or vie for larger sums through an annual business plan competition. Tabar garnered a $5,000 award in his freshman year but says "the amount of consulting and support that I'm getting from these people is just as valuable as any financial support that I'm getting."

Belmont's newest student business Hatchery.

Posted by Jeff Cornwall at 06:56 AM | Permalink

When we first started talking about creating a new major in Social Entrepreneurship -- it is one of the first in the country -- there was much concern about whether 18-21 year-olds would have such a career path on their radar. Those in the Entrepreneurial Generation have one prominent characteristic that gave me confidence that such a degree would indeed resonate with them. They distrust large institutions.

They do not trust established religious institutions -- they tend to be religious, but strongly favor newly formed non-denominational churches. They do not trust large corporations -- they think they are unethical, place too much priority on work above family, and just do not believe that they can provide a stable career path. They do not trust government -- they believe that the private sector is much more efficient and effective at solving the world's problems.

So our Social Entrepreneurship major, which prepares students to tackle social problems through private sector solutions, seems to be taking root very quickly on our campus. Even though it does not even officially become a major until fall, we have several students who have already let us know of their intent to declare the major.

The New York Times ran a column that compared this renewed social energy in today's youth with that of their parents' generation in the 1960s -- but with a twist:

With the American presidential campaign in full swing, the obvious way to change the world might seem to be through politics.

But growing numbers of young people are leaping into the fray and doing the job themselves.

The big government proponents, which typically includes the New York Times, would tell us that the problems of the world are too big, and far too complex, for any solution outside of massive government intervention. We like to talk about the War on This Problem, and the War on That Problem, as if the only solution is too overwhelm each social problem with massive amounts of money controlled by huge bureaucracies.

But the Times story offers several remarkable examples of today's young social entrepreneurs saving the world one small problem at a time. And the author Nicholas Kristof goes so far as to end the story with this glimpse into the world the Entrepreneurial Generation hopes to create:

So as we follow the presidential campaign, let's not forget that the winner isn't the only one who will shape the world. Only one person can become president of the United States, but there's no limit to the number of social entrepreneurs who can make this planet a better place.

(Thanks to Sam Davidson of CoolPeopleCare, a great example of today's young social entrepreneurs, for passing this story along).

Posted by Jeff Cornwall at 06:02 AM | Permalink | Comments (3)

I know that I may be an outlier on this, but I am worried about a possible unintended consequence of the proposed economic stimulus package now in the works in Washington.

The push behind the stimulus legislation is a fear that the economy is slowing. But, the cure may end up being worse than the ailment.

Throughout 2006 and 2007 there were signs that inflation might heat in our economy up for the first time in the past quarter century. We faced a continuing tight job market, with both low unemployment combined with a significant shortage of available skilled workers being reported by small employers. Add to this the significant inflationary pressures from both the energy and healthcare sectors and we have the potential of a witches brew of inflation.

Call me callous, but I felt some relief at the news of a slow down in the economy. Let me be clear -- I was not rooting for a recession (defined as two quarters of negative economic growth). But just like a growing business, our economy needed some time to "adjust" to the incredible sustained period of very robust growth.

The economic stimulus, if it works as hoped for by its proponents, might simply re-ignite the inflationary embers that are still glowing. The inflationary pressures from labor, energy and healthcare will again push prices higher. We could then see the economy enter into an inflationary cycle that will not break until we eventually enter a deep and painful recession.

With prudent attention to interest rates and a commitment to the use of cross-the-board tax cuts (or better yet, true tax reform to meet the needs of our entrepreneurial economy), we can minimize the slow down and ease the economy back into sustainable long-term growth.

The Tax Foundation has additional thoughts on the proposed stimulus at their website.

Posted by Jeff Cornwall at 05:11 AM | Permalink

Diana Ransom interviewed me for an article she was writing about serial entrepreneurs for Smart Money's Small Business website. There can be something addictive about the thrill of the start-up for many of us, including me.

Cornwall, an admitted sucker for start-ups, agrees. "In my eyes, nothing beats the challenge of the start-up." He adds that this phase always offered a number of puzzles to piece together and opportunities to problem-solve. It was stressful, he says, but "as I saw that puzzle creating something that got sales and created jobs, it was [also] kind of cool." In some ways, says Cornwall who is now the director of the Center for Entrepreneurship at Belmont University in Nashville, Tenn., "I get more of that stimulation now because I get to interact with so many start-ups."

Ransom also interviewed Abraham Zaleznik, a psychoanalyst and professor emeritus at the Harvard Business School, who offered this observation: "A juvenile delinquent is impulse-driven." Likewise, he says, "a lot of entrepreneurs are impulse-driven."

Ouch!! But it gets worse....

For business owners, the start-up phase presents a similar cycle of extreme stress and then, upon success, euphoria. However, the rub is: Your body tends to get used to this chemical reaction, and over time you may lose sensitivity to it. According to widely accepted research, future stressful situations may then require heavier doses of body chemicals including the stress hormone, cortisol, to dull the pain. Chronic exposure to cortisol can lead to ill health effects, among them depression, obesity and diabetes. And, it can also harm the brain.

Not all entrepreneurs, even serial entrepreneurs, fit this pattern. Those for whom there is nothing in their lives but being an entrepreneur, may fall into this self-destructive pattern. However, that is not unique to entrepreneurs. There are plenty of workaholic doctors, lawyers, artists, writers, executives, etc., etc., etc.

Temperance is important no matter what we do for a living. Don't just tend to your start-ups -- it is just as important to tend to your families, your friends, your faith, your hobbies.

Part of the hollowness that Zaleznik describes happens when the run of start-ups is over. If all the entrepreneur had in her life was her businesses, it is not surprising that she would feel depressed and unhealthy when she stopped starting new ventures.

Posted by Jeff Cornwall at 09:54 AM | Permalink

Most entrepreneurs make major errors when it comes to terminating employees. Such errors can quickly become quite costly to even a small employer.

Fortune Small Business offers seven basic steps to start to develop a human resource system in a small business:

1. Know the law -- entrepreneurs often do not know even the basics of employment law. We made the decision a long time ago in our program that all of our entrepreneurship students will take a class in Human Resource Management. Employment law is complex and can get even a small employer in deep trouble.

2. Develop a simple employee handbook

3. Don't use employment contracts -- most often they will hurt you, not help you as the employer

4. Keep careful and complete written personnel records -- having clear and complete records saved me more than once when employees tried to fight termination

5. Don't think that moving an employee to a new position can fix their poor performance or problem behaviors

6. Hire people more carefully in the first place -- hire not only for skills but for fit in your organizational culture.

7. Be proactive -- don't wait too long to act on a problem employee. Entrepreneurs seem to have big hearts (and sometimes weak backbones) when it comes to problem employees. We think that if we just keep them on a little longer we can help them turn around their poor performance. Most of this is more of an attempt to postpone the inevitable -- that is, firing the employee -- then it is any realistic attempt to "fix" the employee. For the kind-hearted entrepreneur, by the time he finally admits that he should start to move toward terminating a problem employee, he has probably already waited several weeks or even months too long. In reality, such delays help no one. You are not doing that employee any favor. And you are hurting the performance of your business and diminishing your leadership stature with your other employees.

Posted by Jeff Cornwall at 06:30 AM | Permalink | Comments (1)

Most of us have gotten the message about "phishing" as it applies to mass e-mails sent to get folks to give out bank and credit card info to thieves hoping to snag a few unsuspecting victims.

Their latest approach is to use one of our biggest fears as bait -- an IRS audit.

KraftCPA sent me a sample of the e-mails these folks are sending out:

----Original Message----- From: Internal Revenue Service

Date: Fri, 18 Jan 2008 21:17:18

Subject: Audit and Examination procedure scheduled

After reviewing your latest Tax declaration forms, our office decided to schedule an Audit and Examination procedure of your tax declaration and income forms. In order to view the date scheduled for your Audit and necessary documents for Examination, as well as a list of IRS officers, please visit . . .

It goes on to tell you your "rights" and explains audits using language from actual IRS documents. It all looks rather official. The phishing e-mail will end with something like this:

Examination Methods An examination may be conducted by mail or through an in-person interview and review of the taxpayer's records. The interview may be at an IRS office (office audit) or at the taxpayer's home, place of business, or accountant's office (field audit). Taxpayers may make audio recordings of interviews, provided they give the IRS advance notice. If the time, place, or method that the IRS schedules is not convenient, the taxpayer may request a change, including a change to another IRS office if the taxpayer has moved or business records are there. You are courteously advised to review the information provided (attached) and to contact your local IRS office if you require further assistance.

The IRS does not send out unsolicited e-mails or ask for detailed personal and financial information. Additionally, the IRS never asks people for the PIN numbers, passwords or similar secret access information for their credit card, bank or other financial accounts.

If you get an e-mail like this, DO NOT OPEN THE ATTACHMENT!! Instead, forward the e-mails to phishing@irs.gov (visit the IRS website for specific instructions).

These e-mails often target small business owners, as they are the most common targets of IRS audits.

Posted by Jeff Cornwall at 10:40 AM | Permalink

Got a business model that depends on shelf space in a "big box" retailer?

Fortune Small Business offers some good tips. Although the column is based on a reader trying to get into Home Depot, the advice is useful for small companies trying to sell to any of the big box retailers.

(Thanks to Natalie Wozniak up in Minne-so-cold for passing this along).

Posted by Jeff Cornwall at 05:35 PM | Permalink

ideablob.com has narrowed the January contestants down to the final eight. If you have not heard of it before, think of ideablob.com as American Idol for entrepreneurs via the Internet. People post their ideas on the ideablob.com web site, and visitors vote for their favorite idea. The winner each month with the most votes gets $10,000 for their business.

As some of you know, one of our students here at Belmont, Andy Tabar, is a finalist this month. Andy is a junior, majoring in Entrepreneurship. He has been working on his web development company from his first day here at Belmont. Here is a link to his business web page.

There is now a new round of voting for the finals. Even iff you voted before, you cn now vote again in the finals. If you did not, please take a few minutes to go to their site, register, and VOTE FOR ANDY!!!! It is quick and easy.

Here is where you go to register and vote. If you have voted before, use your same user name and password. Andy’s business idea is titled “Expand my global tech company”.

If Andy wins the final round of voting, he will get $10,000 to help him grow his business!!

PLEASE help out Andy on this. Pass this along to friends and family. The more votes we can get, the better his chances to win. Every vote counts!!

Thanks!!!!!!!

Posted by Jeff Cornwall at 04:28 PM | Permalink

The latest study released by the Global Entrepreneurship Monitor shows just how global the small business world has become.

In high-income countries and depending on the size of the national economy, 10-40% of early-stage entrepreneurs expect 25% or more of their customers to come from outside their country. GEM also found that the more burdensome a country’s business regulations, the lower the entrepreneurs’ expectations for growth.

This is not only an issue for entrepreneurs to ponder for their business plans or their strategic decision-making. It is also an issue for public policy.

"The world economy needs entrepreneurs," says Babson Professor and GEM U.S. team member Kent Jones, "and increasingly, entrepreneurs depend on an open and expanding world economy for new opportunities and growth-- through trade, foreign investment, and finance. GEM research confirms that new entrepreneurial opportunities in all countries will expand if trade, entrepreneurship and economic growth are fostered, especially in the developing world."

The best way to foster the global reach of the entrepreneurial economic boom is through open, free markets, low regulatory barriers, and low tax rates. Previous GEM reports have supported this formula.

So to you entrepreneurs out there: Think Global!

And to you public policy folks and government bureaucrats: Everything you try to actively do to steer the entrepreneurial economy will only hurt it -- resist the temptation to intervene and get out of the way!

Posted by Jeff Cornwall at 07:11 AM | Permalink

TechKnowledge Point announced the ten national semifinal ventures coming to the 5th Annual Spirit of Entrepreneurship and Enterprise Development (S.E.E.D.) National Collegiate Venture Forum on March 14th and 15th at the Reagan Ranch Center in downtown Santa Barbara. Congratulations to Belmont University junior Andy Tabar for making the semifinals of this year's competition. Andy is an entrepreneurship major here at Belmont.

The compete list of the final ten in this competition (in alphabetical order by venture name):

- Bizooki, LLC, Belmont University
- Nauti-Click Corporation, Emory University
- Navitas, Inc., University of Wisconsin-Madison
- Real Agent, Inc., University of San Francisco
- Second Breath, LLC, Union College, NY
- StudentBusinesses.com, Harvard University
- ToneRite Corporation, University of Florida
- Urogen, LLC, University of Central Oklahoma
- UV Force, Inc., University of California-Santa Barbara
- Zipperz Corporation, Westmont College

The vision of SEED is to help top collegiate ventures secure capital funding. SEED completes preliminary due diligence on dozens of business plans submitted by the December deadline, then invites the most promising ventures to present their business plans to a world-class panel of evaluators, early-stage investors, and product development and market-industry specialists. SEED attracts dozens of qualified investors to see the presentations (angel investors, hedge fund managers, private equity managers, venture capital fund managers, and investment bankers).

Posted by Jeff Cornwall at 01:54 PM | Permalink

The latest statistics from the National Venture Capital Association seems to suggest that the high growth sector of our entrepreneurial economy has leveled off. Venture capital firms raised just slightly more than they did in 2006 (up 2.6%). This was expected, since capital markets have tightened and many funds still have significant over hang of uninvested funds. Mergers, acquisitions, and initial public offerings were up a bit. These results are good in that we did not see a downturn in the venture backed sector. But, it is a further indication that the entrepreneurial economy is no longer showing the robust expansion we saw over the past few years.

Posted by Jeff Cornwall at 08:49 AM | Permalink

The New York Times -- that's right, the New York Times -- credits tax cuts for fueling the entrepreneurial economy in Ireland:

Government help for Irish entrepreneurs grew out of an overall economic policy devised in 1987 that reduced personal taxes, said Kevin Sherry, a director of Enterprise Ireland who specializes in start-up companies.

Sadly, we seem to have forgotten this lesson in the US. The Democrats have resurrected the politics of envy, harking any number of tax increase schemes. At the same time our Republican President offers us only a one time tax rebate as a feeble attempt to stimulate the economy.

(Thanks to Ben Cunningham for passing this story along).

Posted by Jeff Cornwall at 07:27 AM | Permalink | Comments (2)

When I meet with prospective students and tell them about all of the cool features of our program, they inevitably ask me one question: "OK, but are you going to teach me how to write a business plan?"

We set business plans up on a pedestal as if it is the holy grail of entrepreneurship. Just look at BusinessWeek.com's most recent special issue on entrepreneurship -- it is all about business planning. The articles in this special edition include:

"The Right Business Plan for the Job"

"Before You Write a Business Plan "

"Slide Show: The Best Business Plan Tools"

"Video: What the Business Plan Expert Knows "

"How to Write a Winning Business Plan"

"Building a Better Business Plan "

"How to Win a B-School Competition"

It is as if we are telling aspiring entrepreneurs that once they unlock the secrets of the business plan, the world of entrepreneurial wealth will come pouring out at them.

Sorry, but this is just not true.

On the other hand, there is now a debate raging as to whether we should even teach entrepreneurs about business plans. a growing number of experts now fundamentally question whether business plans even matter. It seems that some data suggests that business plans have no impact on the overall success of entrepreneurial ventures.

All of this -- and I mean both sides of this debate -- is missing the point.

Are business plans all you need to know to unlock the door to success? Of course not.

Is writing a business plan a complete waste of time? Also, not true.

So why do we teach about business plans? It is because they are a way to help organize what can be a complex and overwhelming array of issues. It is because it forces us to integrate our marketing plans, or operating plans and our financial plans into one, coherent story. It is because we need to put it all down on paper to make sure that we have thought of all of the important stuff that goes into a successful start-up. It is because business plans have become the standard for communicating about a business to those with money.

Will a formal business plan make you richer and more successful? Probably not. I know many entrepreneurs who never wrote a formal business plan for their ventures who have made a lot of money. But they all understood the importance of business planning. They just never took the final step of writing it down. While the business plan itself may not always be necessary, effective business planning always is.

Understand that the business plan is just a map. It is a map into an unknown territory. Our actual path in our business will likely look very different than our plan. But the plan got us thinking. It made us think about all the details. It helped us understand how all of the parts of a business fit together to make a whole venture. It helps prepare us for our journey and makes us better prepared to adjust to all of the surprises that we will face almost every day we're in business.

Success will not be determined by the plan. Success comes from implementation.

On every golf hole I always start with a plan of how I should play the hole. Then I actually hit my shot. The wind may change direction. the ball might take an unexpectedly bad hop on the ground. Or -- and this is most likely -- I just don't hit the ball the way I had planned and hoped. So the way I actually play the hole changes with the reality of each shot based on my execution and based on the uncontrollable events that are a part of any activity -- be it golf or be it building a business.

But I still plan. I just know that I will have to adjust my plan each step along the way as I begin to implement it as I start and grow my business.

Posted by Jeff Cornwall at 12:52 PM | Permalink | Comments (4)

The curves we draw to represent the growth of a business are misleading -- in fact they are flat out wrong. They usually show smooth curves with revenues meeting expenses at break-even, then swooping us toward the heavens leaving ever growing profits in their wake.

The truth is that growth is a messy thing. It never follows a smooth path. The real curves that signify growth are jagged. Growth is lumpy, not smooth.

Growth requires us to make leaps of faith as we commit to significant new overhead, including more space, more equipment and more staff. With every new commitment to overhead, our break-even point increases accordingly. If we are growing fast in the early development of the business, this means that our point of break-even cash flow keeps getting pushed further into the future. Even if we have reached profitability, these new overhead commitments can quickly turn a business in the black to a business that is in the red.

Growth can stoke the flames of the burn rate that consumes our precious cash.

Growth in a business is good. It is a sign of that the market agrees with our dreams and our plans.

And in today's dynamic economy, a growing business is like the shark -- it has to keep moving forward, or it will drown.

The commitment to growth requires careful thought and careful planning. Never grow simply on faith and hope. Grow with a careful plan that tells you what challenges your decision to grow will create. Understand all of the chain reactions that growth creates for more space, more equipment, more parking, more computers, more people, more customers, and more cash.

Make your growth intentional. Some of our growth is, in fact, quite controllable. Never let your market completely dictate your growth. Sometimes pass up opportunity for the health of your business. Leave time for your business to adjust to its new level of operation -- allow time for your business to "digest" its latest growth. This gives time for your cash flow and your systems to catch up to the higher level of activity.

Growth can be the best thing that happens to a business or the worst thing that happens. The more you understand how growth will impact your business and the more you take control of that growth, the better chance you will to make it through the two stages of any period of growth. You must first survive each growth spurt before you can thrive on that growth.

Posted by Jeff Cornwall at 08:14 AM | Permalink

I have taken issue quite frequently with the National Dialogue on Entrepreneurship and their pro-socialized entrepreneurship stances. This time their interpretation of tax policy just baffles me:

But, the effectiveness of government finance systems also matters. A new study from the Pew Center on the States raises some red flags about how some US states are performing on this front. Effective tax systems provide stable revenue, support efficient tax collection, provide transparent information about incentives, and give localities some say in how their tax dollars are used. Unfortunately, many state tax systems fail on these measures. As a result, these lagging states lack the ability to support new economic engines while continuing to provide outdated and unnecessary incentives to other economic sectors.

This report lists heavy tax states such as Minnesota and New Jersey as being effective tax collectors, while several low tax states are listed as being poor tax collectors.

The evidence is clear that tax rates are what matters in driving entrepreneurial activity -- and the lower the rates the better. We don't need government to be the engine of our economy. We need free enterprise to be the engine.

The notion that we need to redistribute wealth through the government to support entrepreneurs is, in a word, absurd. Leave the money in their pockets and see what really can happen!

Posted by Jeff Cornwall at 04:33 PM | Permalink

We are still floating on air around here after our award this weekend. To be honest, we thought it would take several more years to reach this level. Thanks to everyone for their kind words. Thanks to Anita Campbell for her nice write up at her blog site. She has become a good friend over my years of blogging.

Here is a picture of our team from San Antonio. That look you see in my eyes is total shock and amazement!!

Posted by Jeff Cornwall at 09:46 AM | Permalink

From Today’s Tennessean:

Middle Tennesseans dominated a national entrepreneurship awards show over the weekend, with Belmont University and "The Bun Lady" taking top prizes.

The awards were given in San Antonio, Texas, at the annual United States Association for Small Business and Entrepreneurship conference, the largest such conference in the world.

On Saturday, the Belmont University Center for Entrepreneurship received the 2008 National Model Undergraduate Program award, beating out Ball State University of Muncie, Ind., said director Jeff Cornwall.

"Oh man, it puts us on a national stage in terms of our program, and will help us attract better and better students," said Cornwall, who writes a regular column for The Tennessean.

"It's going to open the door for future funding and support for the program. It's clearly a step to take us to a much higher level than we've been able to get to so far."

The school also won the Outstanding Case Study award for its study of Cordia Harrington, president and CEO of the Tennessee Bun Co. in Dickson. Harrington, who delivered a keynote address at the conference, was named Woman Entrepreneur of the Year, Cornwall said.

Posted by Jeff Cornwall at 06:53 AM | Permalink | Comments (2)

My colleague Mark Schenkel, Chris Gray(our former grad student), and I wrote a case study on the Bun Lady. We were thrilled to find out that it won the Outstanding Case Award here at USASBE. And how cool it was that Cordia "The Bun Lady" was here to see us win!

(Thanks for the picture, Bruce!).

Posted by Jeff Cornwall at 11:38 AM | Permalink

Our kick-off speaker this morning at USASBE was Guy Kawasaki.

Guy Kawasaki is a managing director of Garage Technology Ventures, an early-stage venture capital firm, and a columnist for Entrepreneur Magazine. In addition to his blog, which I know many of you frequent, Guy is the author of several books including The Art of the Start.

Guy began his career as an Apple Fellow at Apple Computer, Inc., where for four years he evangelized Macintosh to software and hardware developers and led the charge against world-wide domination by IBM. Guy left Apple to start a Macintosh database company called ACIUS, which published a product called 4th Dimension.

Later, he returned to Apple as an Apple Fellow, where his main task was to maintain and rejuvenate Macintosh customers. A few years later, he left Apple to co-found Garage Technology Ventures, a venture capital firm and making direct investments in early-stage technology companies.

Guy offered many pearls of wisdom, but one of the best that I had not heard from him before was this:

"An old Chinese proverb says this: 'If you wait by the river eventually the body of your enemy will float by.'"

Too many entrepreneurs are impatient and impulsive. They lock themselves into a cat and mouse game with competitors. In doing so, they become too clever by half. Put your energy into your employees and your customers.

Good things take time. It takes time to build a successful business and it takes time to build wealth. Take the high road, work hard, stick to your vision, make your customers your evangelists, and all those competitors you are obsessing about will take care of themselves.

Posted by Jeff Cornwall at 09:26 AM | Permalink | Comments (2)

This evening I had the distinct honor of introducing Cordia Harrington, founder of Tennessee Bun Company, as the kick-off keynote speaker at USASBE.

Cordia Harrington, best known as The Bun Lady, is the President and CEO of Tennessee Bun Company. Founded in 1996, Tennessee Bun Company (TBC) produces 60,000 buns an hour and supplies these to restaurants such as McDonalds, Chili’s and Pepperidge Farm. TBC is one of the most highly automated bakeries in the world, producing 1,000 buns per minute, and ships to 40 states east of the Rockies and to the Caribbean. In 1999, Harrington also opened Nashville Bun Company, a producer of English muffins for McDonalds, Sheetz, Perkins, and Wolferman's Gourmet English Muffins. She added a Hearth line to Nashville Bun Company in 2005 to supply McDonalds and O'Charleys.

Prior to baking, she owned three highly successful McDonald's restaurants in Illinois. Cordia's enthusiasm and passion for her work are highly contagious and laid the foundation for her success. Cordia is a graduate of University of Arkansas, Kansai Gaidai and Osaka Japan, and Hamburger University. She has built several successful companies including real estate, fast-food restaurants and commercial bakeries from start-up.

Cordia offered humor, wisdom, and inspiration in telling her story of going from bootstrapping her real estate business through the $50 million multi-national company she operates today. If you ever get the chance to hear her speak, make sure to take advantage of it. It is rare that an entrepreneur can wow a group of academics -- but, Cordia pulled it off.

At the end of her speech, Cordia was named the USASBE Woman Entrepreneur of the Year for 2008. A well deserved honor, indeed!

Posted by Jeff Cornwall at 10:58 PM | Permalink | Comments (1)

Today USASBE we heard from several schools about their innovative programs aimed at taking entrepreneurship education across their campuses during the Coleman Pre-Conference on Taking Entrepreneurship Across Campus. This pre-conference was organized and hosted by Belmont University.

Participating schools highlighted the following innovations at their schools:

- St. John’s University presented their video cases on entrepreneurship.

- Juniata College offered some great details on hos to run a student seed venture fund.

- Bay Path College summarized several features from their innovative entrepreneurship program .

- University of Portland presented their initiative to infuse entrepreneurship across their campus through faculty grants.

- Drake University summarized their integration of entrepreneurship with their School of Pharmacy.

- Beloit College provided details on their student run Art Gallery.

- Simmons University reviewed their integration of entrepreneurship with Nursing and Social Work.

- I summarized our campus-based businesses, which includes our three retail student created, student run stores at Belmont University.

- Millikin University presented their model for the integration of entrepreneurship and the arts at their Blue Connection art gallery.

- University of Illinois-Chicago reviewed their long standing operation of the national student organization, Collegiate Entrepreneur Organization (CEO).

As part of the pre-conference we introduced a new website called Sandbox that will allow for educators to share best practices and collaborate about problems and challenges they are facing as they grow their entrepreneurship programs. This site will go live in February. It is being developed by Belmont's own, Andy Tabar. Andy is the student I blogged about early who is a finalist in this month's ideablob.com idea competition. Ideablob.com is one of this year's new sponsors at USASBE.

It is amazing to see the explosion of innovation that is taking place around the country. It is great to see that so many colleges and universities are trying to help educate the future leaders of our entrepreneurial economy.

Posted by Jeff Cornwall at 02:16 PM | Permalink

I am blogging the rest of this week from the 2008 annual meeting of the United States Association of Small Business and Entrepreneurship (USASBE) being held this year in San Antonio.

USASBE is the leading voice in entrepreneurship research, teaching, and application. USASBE's mission is to advance knowledge and foster business development through entrepreneurship education and research.

I will be posting the highlights of the conference for the next several days.

Today should prove to be an exciting opening. Belmont has organized a pre-conference session today that will be hearing about a variety of exciting new innovations in entrepreneurship education from schools from across the country. This pre-conference is sponsored by a grant from the Coleman Foundation.

Then this evening I have the honor of introducing one of my favorite entrepreneurs from Middle Tennessee. Cordia Harrington, best known as The Bun Lady, is the President and CEO of Tennessee Bun Company. Founded in 1996, Tennessee Bun Company (TBC) produces 60,000 buns an hour and supplies these to restaurants such as McDonalds, Chili’s and Pepperidge Farm. TBC is one of the most highly automated bakeries in the world, producing 1,000 buns per minute, and ships to 40 states east of the Rockies and to the Caribbean. In 1999, Harrington also opened Nashville Bun Company, a producer of English muffins for McDonalds, Sheetz, Perkins, and Wolferman’s Gourmet English Muffins. She added a Hearth line to Nashville Bun Company in 2005 to supply McDonalds and O’Charleys.

Cordia is a regular speaker to our classes at Belmont.

Posted by Jeff Cornwall at 05:54 AM | Permalink

Each year Entrepreneur magazine lists its top 500 Franchises. Click here to see their listing for 2008.

Before you decide to get serious about starting a franchise, take a look at a post I wrote in 2004 about the pros and cons of buying a franchise.

Posted by Jeff Cornwall at 05:26 AM | Permalink

Fast Company has released its 2008 Social Entrepreneur Awards.

They now include a category that includes for-profit social entrepreneurs. This is a growing trend as social entrepreneurs see fewer advantages and more headaches associated with non-profit status.

Posted by Jeff Cornwall at 07:03 AM | Permalink | Comments (2)

Being a life-long Green Bay Packer fan, I remember fondly the Vince Lombardi days. A couple of Lombardi memorabilia adorn our Rec Room, which has become our Packer shrine. And I still will throw in one of his quotes about leadership now and then in one of my lectures.

It might be time to say move over Vince and make room for Mike. Green Bay Packer coach Mike McCarthy seems to set the leadership tone just right up in the frozen tundra.

From Mike Vandermause's column at PackerNews.com:

If you're searching for reasons why the Packers are 13-3 this season, start with the second-year coach's no-nonsense approach that includes a twist.

McCarthy demands commitment and production, but he trusts his players and treats them like adults.

Too many coaches make the mistake of micromanaging, which can have a suffocating effect on a team. McCarthy seems to have struck the perfect balance between setting a high standard and giving his players the freedom to carry it out.

Set high standards, communicate those standards clearly, expect results, and most importantly, treat people with respect and trust that they will perform. This is a great leadership formula. Does it result in 100% success? Of course not. No leader can ever make that happen. There is too much random chance out of our control, and people are people. Adjust to the surprises that come your way, and if people do not respond to being treated with respect and autonomy, find new people who will.

Treat your employees with respect, and they will respect you. Your job is not to be their friend, but to be their leader. Listen to the words of veteran defensive tackle Ryan Pickett from Vandermause's column:

"I like it that he's approachable. He's tough, he means what he says, says what he means. At the same time, the guys can all go to him, and he listens. And players, they rally behind a guy like that. It's easy to play for a coach like that. Everybody respects him."

And don't forget to have some fun. Much of a leader's role using this style is to keep everyone loose and foster a positive culture.

Go Pack!!!!

(A note a full disclosure -- I am also a shareholder of the Green Bay Packers. But no worry. I am not trying to push up the value of my stock. Once you buy the stock you can never sell it and it will never pay a dividend. But it makes a really cool addition to our Packer collection in the Rec Room!)

Posted by Jeff Cornwall at 06:39 AM | Permalink | Comments (1)

So what's worrying small business owners? Inflation!

While the Federal Reserve is focused on the problems of the large banks, small-business owners are worried about inflation according to the National Federation of Independent Business December Small Business Economic Trends report released today. Plans to raise prices to respons to higher costs rose from 21 percent in September to 26 percent of all owners in December.

"The historic relationship between inflation and the percent of owners reporting higher prices suggests that inflation will be showing some new, unwanted viability," said NFIB Chief Economist William Dunkelberg.

Unadjusted, 27 percent of small-business owners surveyed reported raising average selling prices, up three points from November, and 12 percent reported lower selling prices, unchanged. This price cutting phase has lasted well over a year.

In case you didn't believe me when I wrote my last post on my fear of renewed inflation, please take another look at it given this new development.

I am not guaranteeing that we will have a period of sustained inflation, but the risk is real enough to cause me great concern. My concerns have grown even stronger over the past few weeks with some of the talk in Washington about the need for an economic stimulus. If the politicians move in this direction, the odds of serious inflation and all of the pain it will create goes up considerably. Stimulating spending during potentially inflationary times like these is like throwing gasoline on the fires of inflation that are already burning due to oil prices, a tight labor market, and soaring grain prices.

Posted by Jeff Cornwall at 06:37 AM | Permalink | Comments (1)

Entrepreneurship on steroids. That is what I call entrepreneurs who are consumed with raising as much money as they can, as fast as they can. When we confuse the means (raising capital and securing other needed resources) with the ends (building a sustainable business), we see entrepreneurship run amuck.

The goal of entrepreneurship is not simply to find the next big thing to lure venture capital or make a mad dash to a public offering. It is to create a venture that creates income and wealth for the entrepreneur and allows the entrepreneur to pursue other goals in life through this economic activity, be it creating more jobs in a better place to work, offering a better product to the customer, or making the world a little better place. The goal of entrepreneurship should be to build a good business -- with legs -- that will help build this entrepreneurial economy.

So on this theme I offer you one of the funniest, albeit somewhat depressing due its truth, videos I have seen in a long time: Here Comes Another Bubble v1.1 - The Richter Scale via YouTube.

(Thanks to Bruce Schierstedt for passing along this gem!)

Posted by Jeff Cornwall at 05:47 AM | Permalink | Comments (2)

In my days as an entrepreneur I would often joke with my entrepreneur friends that we should start a "3:00 a.m. Club". It seems that most of us were always awake worrying about something or other in our businesses in the middle of the night. I seemed to wake up right about 3:00 a.m. with spreadsheets in my head (just to date myself a bit, they were Lotus 1-2-3 spreadsheets).

Well, someone has now come up with a term for this particular entrepreneurial affliction -- "sleepworking."

According to the 2nd Annual Staples National Small-Business Survey, more than half of small-business professionals said that work has actually become part of their dreams. Fifty-one percent of those surveyed said that they “sleepwork” (i.e. dream about work), and nearly 70 percent of those “sleepworkers” report they wake up and put their “work dreams” to action.

The survey also revealed that 98 percent of U.S. small-business owners and managers are working during their time off -- including nights, weekends and vacations -- and nearly 54 percent expect to work even harder in 2008. This is not good news. I am on a personal quest to find a verb that describes entrepreneurship so we can stop defining ourselves only by what we do in our work (see this recent post for my rant on this issue).

Other results from this survey also give us something to think about:

- The car remains a favorite place to work, with 72 percent saying they make business calls while driving and nearly 40 percent saying they get their best ideas behind the wheel. I think I get stuck behind these people every morning on my way to the University.

- Slightly more than 38 percent cannot remember the last time they took a vacation. If this bothers you at all, please see this essay on why a good vacation is so important and how you might really make one happen.

- If given a choice, nearly 52 percent said they would accept comparable business results in 2008 if they could have twice as much free time. There is hope!! But wait... 48 percent said they would work even more hours if they could double their company’s sales. Fifty-two percent make New Year's resolutions for their business. Of those, 58 percent said they resolve to increase business, while only 21 percent said they want more time off.

Folks... I love entrepreneurship and free enterprise as much as anyone, but not ahead of my family and my health.

Here is a New Year's Resolution for all entrepreneurs. Slow down, just a bit. Enjoy your successes in business, but never at the expense of your health, family, faith, and friends.

Posted by Jeff Cornwall at 05:02 AM | Permalink | Comments (1)

Before Christmas I had written a couple of posts looking at the reasons that people bootstrap their businesses. Lack of money and the desire to keep control were the first two reasons I wrote about in previous posts.

Another important outcome of effective bootstrapping is that it increases the income and wealth that entrepreneurs can realize from their businesses over time. Generally business owners get paid only after all of the expenses have been covered. Therefore, the ability for an entrepreneur to receive income from the business is a function of its cash flow. Since bootstrapping can improve cash flow from the business it is a means of ensuring personal income for the entrepreneur. By improving cash flow, bootstrapping increases the amount of cash the entrepreneur can take out as personal income from the business.

Additionally, much of the wealth that an entrepreneur is able to realize from the business is based on its valuation at the time the business is sold. The value of a business is based on the expected cash flow that the buyer believes the business can generate into the future. The most common valuation method for privately owned businesses is based on a multiple of the free cash flow the business generates. The multiple is based on several factors including historic growth of the venture, strength of the industry, strategic advantages of the company, and specific industry valuation standards. The degree to which the entrepreneur is able to improve cash flow through bootstrapping techniques the higher the value that can be created for the business. Bootstrapping is therefore not only good for the health of the business, but also personally good for the entrepreneur in terms of income and wealth.

Posted by Jeff Cornwall at 05:01 AM | Permalink | Comments (4)

Recent estimates place the number of home-based entrepreneurial ventures in the US at around 13 million. A recent article at the Wall Street Journal suggests that home-based businesses need a plan as much as any other entrepreneur. But rather than being used to secure financing, this plan should be used to keep sanity and order in your home office.

Alvah Parker...a career transition coach...suggests at-home entrepreneurs write a detailed business plan that includes not just projections for the business itself, but also specifics on how you'll manage working from home. This includes laying out a regular work schedule and describing in advance how you'll handle specific scenarios, such as if a friend or relative calls during working hours or your child interrupts during an important phone call. You might even designate a time during the day or evening for household tasks, errands or recreational activities you'd otherwise be tempted to do during work hours.

And that reminds me... it is 2:30 and my plan for the day at my home office is to stop writing and take a walk with my wife and our dogs. I need to stick to my plan!

Posted by Jeff Cornwall at 02:26 PM | Permalink | Comments (1)

If you've ever interacted with a VC you might find it hard to imagine them feeling bullish about anything, but the latest survey released by the NCVA paints VCs as having a fairly optimistic outlook for 2008.

Venture capitalists are forecasting an active year for the industry with high growth in the CleanTech sector, an improving IPO market and fewer venture firms in 2008. These predictions are among the top line findings of the NVCA 2008 Predictions Survey. The results also show concerns about global investments in certain regions including China. Additionally, the industry believes fund sizes will become larger and returns for limited partners of venture capital funds will improve in both the short and long term horizons.

Posted by Jeff Cornwall at 02:20 PM | Permalink | Comments (1)

One of our students here at Belmont is a finalist for this round of ideablob.com voting. If you haven't been to the site, think of it as a monthly American Idol for business ideas with voting taking place at the website.

Andy Tabar is one of our student practicing entrepreneurs trying to build his web-based business. It is easy to vote. Just go to the ideablob.com website and register. After you have go back to the main page for ideablob.com and vote for Andy's entry "Expand my global tech company" idea. Please go to ideablob.com and vote for Andy!!

Posted by Jeff Cornwall at 08:15 AM | Permalink