MANY PEOPLE HAVE DREAMS OF STARTING THEIR OWN BUSINESSES, BUT ALL TOO OFTEN, THOSE ASPIRATIONS ARE DASHED BY #FEAR. SO IS FEAR A REAL THING?
Underlying fears are typically the most prevalent culprits behind indecision, inaction, stagnation, regression, and so on. And interestingly enough, many would-be #entrepreneurs succumb to hard-driving emotions. Like anyone else, they, too, whether knowingly or unknowingly, hesitate or recoil at the crossroads to their destinies. That is why the words of noted evangelist #TDJakes ring true: “Fear is the assassin of greatness.” And so, the answer to the question is simple: in a world where perception is a greater force than reality, yes, fear is a very real thing.
In order to overcome or manage fear, it must first be understood for what it is. Many are unlikely to admit it, but fear is something that resides in each of us. It is an emotional response to stimuli that, in humans, travels through our neural circuitry from the parts of the #brain known as the #amygdala, and because this emotion is connected to the self-preservation instincts of every living organism, it would be fair to say that its existence dates back to the dawn of creation. In humans, fear is triggered when the amygdala recognizes threatening stimuli being collected by the body’s senses, which also happens to be sharing this information with the brain’s cortex. Detecting a threat, the amygdala can bypass the neocortex and prompts the body into action, even without a conscious impetus, quickly initiating an evaluation of the perceived threat and determining an appropriate response. There is little that the untrained mind can do; fear can strike out of nowhere. And just as literal threats can cause a rush of insurmountable fear, figurative ones like uncertainty can also cause ongoing bouts of anxiety and apprehension.
In his best-selling book #EmotionalIntelligence, Daniel Goleman wrote that we have two minds—one emotional, the other rational—and that, for the sake of a healthy life, the rational mind had to be in control. He described emotional intelligence (EQ) as the ability to “motivate and persist in the face of frustrations, to control impulses and delay gratification, to regulate one’s moods and keep distress from swamping the ability to think, [and] to empathize and to hope.” Goleman believed that people were too often collared by their emotional mind, but through EQ, they could learn to temper their emotional propensities and discover ways to grow. And where fear was concerned, Goleman acknowledged that it was possible to reshape the human response to threatening stimuli, by working to help individuals understand why they are afraid, redefine the stimuli that frightened them, and replace negative experiences of the past with new and positive ones. This process was called emotional relearning.
Such a psychotherapeutic approach to understanding and overcoming fear is also useful in the business world, where fear can undermine new ventures, cause the suppression of much-needed talent and ideas, upend change initiatives, and (worst still) strengthen corrupt or obsolete leadership. Every new entrepreneur has arrived at a crossroads with a degree of trepidation, as he or she gazed onto the dueling #possibilities of promise and of peril. But only those entrepreneurs with the capacity to identify and overcome their fears of failure (peril) have a better shot at success (promise) than, say, those who elect to stand there, or perhaps those who decide to take costly detours, or even those who decide to walk away entirely.
Here are a few thoughts on how an aspiring entrepreneurs can begin to understand and overcome the fears affecting his new ventures:
–Recognize that he is standing at the crossroads. Here, fear is a common emotion, and it is nothing for which anyone should be ashamed. As he starts to make this recognition, he can begin to understand what the fear is and how it is impacting his prospects.
–Develop a #vision of the other side. The entrepreneur should ask himself the question: if not for this emotional impediment, where could his dream be? Could it be brought into successfully fruition? An honest effort to answer this question will enable him to paint of picture of where he would like to take his venture. From there, he can set attainable benchmarks and #goals by which to transform that picture into reality.
–Know the real enemy. Many fears are based on inaccurate presumptions. As he begin to identify his fears, the entrepreneur should also make an effort to fully understand where they come from, and determine more accurately their levels of potency and validity. What he find may surprise you: many of these fears may be unfounded or simply based on erroneous information.
–Get help. There is no shame in admitting limits, and this is the reason that people in my field consistently tell entrepreneurs that they need BAIL (“bankers, accountants, insurance agents, and lawyers”), as well as very bright #businessconsultants, to help devise and navigate the course forward. These people, along with the members of the entrepreneur’s team, will complement his abilities and serve as a support system.
–Take that first step. Once he has an idea of where he is headed, the necessary resources, and a plan – yes, a #businessplan! – for getting there, he does not have to be afraid to go for it.
–Persevere. When the entrepreneur confronts what should be fearful moments – and he will – the typical biological impulses may surface. Nevertheless, he must have confidence, and he should trust his rational mind, as well as his support system, to get him through the anxiety.
–Know that everything is temporal. Today’s times of challenge are tomorrow’s moments of #triumph. The entrepreneur must remember that what he faces today, if encountered effectively, can help to propel him forward, where undoubtedly, he will face a whole new set of challenges and where he may have to identify different types of fears. With any luck, though, the lessons learned from today will prepare him for much of what is further down the road.
Gary C. Harrell, the author of this piece, is the founder and managing principal of Axiom Strategy Advisors, LLC. For additional information, please write email@example.com.
©2015 All rights reserved; Axiom Strategy Advisors, LLC
By Gary C. Harrell
Today let’s talk about turnarounds, with a look at leadership, particularly the leadership recruited to salvage troubled enterprises, both big and small.
When an enterprise finds itself facing an uncommon and worsening situation, the stakeholders of that enterprise traditionally must come to terms with reality. They might be hesitant to admit it, but their current management, though not for trying, may not be well-suited to reverse the course of a downturn. Consequently, with this realization, the stakeholders must look outside of their enterprise for help. The people to whom these stakeholders ultimately relinquish the reins of power are known as turnaround managers.
Most people in the general public have a preconceived and quite skewed notion about the practice of turnaround management. For starters, they believe that turnaround managers are ruthless and uncaring individuals, marching through enterprises like marauders in business suits. The general public also assumes that the use of turnaround managers is restricted to large enterprises. Quite to the contrary, however, most turnaround managers are not raiders, and their work is not limited to the big corporations. These managers, in truth, embed themselves into an enterprise, mostly on a full-time basis, actively managing the operations of that enterprise to produce much-needed growth, and they typically tie their compensation to the improved performance of that enterprise. A turnaround manager does not have the luxury of behaving like Gordon Gecko; the manager actually has to get his hands dirty, one enterprise at a time. What’s more, turnaround-management services abound for every stripe and size of enterprise. In fact, a whole cottage industry exists that provides services to struggling, early-stage and young enterprises, and among the providers in this sector is…well, need we say more?
Any turnaround can be a challenge to even the most seasoned manager, and there is no singular protocol for encountering every enterprise in a downturn. Indeed, the circumstances facing troubled enterprises vary from one to the next, and for that reason, a manager might find himself confronting a substantial and underserviced debt portfolio in one case, while the paramount issue might be a dated and inefficient facilities in another. That said, however, there is a broader roadmap for all managers to consider when preparing to undertake such efforts. This roadmap helps to move managers into the proper frame of mind, in order to achieve the most optimal results from whatever strategy he elects to deploy. Here are a few points from that roadmap:
- Perform comprehensive intelligence. As the turnaround manager enters the troubled enterprise, he must do so not ready to act, but to learn. The manager must begin his work by gaining a clear understanding of the situation affecting the enterprise. He must study its current strategy, as well as its operational structure and capacity, and he must also learn as much as he can about the offerings and the pipeline for new offerings, the technology and systems used to make and deliver those offerings, and the competitive environment in which those offerings are sold. Much of this information needs to come in form of data points, but he must rely also on interviews and conversations with his immediate subordinates, the stakeholders, and key personnel. And before he goes further, he has to develop a keen understanding of just how the current strategy, along with other factors, contributed to the hardship of the enterprise. He should do this if for no other reason than to avoid prescribing and making the same mistakes as his predecessors.
- Analyze the information. After all of the intelligence is gathered, and as the analysis begins, the manager must remember that some parts of what he has learned might be inaccurate or invalid information. After all, the current structure and its flawed strategy were in place and likely contributed to the downturn. For that reason, he must be very judicious about the use of the information from his fact-finding exercise, and he must not hesitate to dismiss anything that does not seem consistent with other portions of those facts or his own understanding.
- Set transitional priorities. From his findings, the manager must begin to develop a new strategy for the enterprise, one that is designed to reinvigorate, and one that is detailed in the numerous pages of a strategic plan, a restructuring plan, a new operational model, a working timetable, a Plan for Growth, and so on. This new strategy must address any cultural and operational impediments of the enterprise that the manager identified during his fact-finding exercise, and it must give a vision of what the enterprise will look like and how it will operate going forward. More specifically, the strategy should set new, measurable goals for every area of the enterprise, and these goals should begin to produce marked results over the first twelve months and far into the following year. Making these goals clear to the stakeholders, and securing their buy-in, is an important step for creating the formulaic system by which the manager’s own performance can be fairly measure. (To be sure, some stakeholders might demand faster results in the first year, but a rational manager should remain steadfast, reminding those stakeholders that, since it did not take the enterprise a few short months to nearly collapse, it would be imprudent to think that corrective action might yield serious results in such a short time.)
- Establish a turnaround team. Once the manager has corralled the support of the stakeholders, he must act quickly to institute his changes to the enterprise. This, he cannot do on his own; he will need a team. But before he starts hiring, he must start firing. The manager must purge the organization of its weaker personnel and those likely to resist the imposition of the new strategy, as both types of individuals would only be laggards in a new and more challenging environment. As the majority of the dismissals occur, the manager must begin to install his new team of leaders. It is important to understand that, while a few leaders might be carried over from the old management structure or promoted up from the rank and file, it is more common for a manager to hire from outside of the enterprise (if he has been afford such latitude by the stakeholders). The two overarching reasons for this effort are simple: he is seeking new and diverse ideas not readily found in the current talent pool, and he is hoping to transform the operational expectations and the general culture of the enterprise in a meaningful way.
- Articulate the changes and expectations to the enterprise. People increasingly understand that change is the only true constant, but that does not mean that they will easily accept it or not be confused by it. This is especially true in the manager’s enterprise, where a whirlwind of dismissals and new hires, to say little of wholesale divestitures, promise to reshape everything, while leaving personnel to wonder how they fit into this equation. For this reason, the manager and his new turnaround team must act quickly to bring the personnel up to speed on what these changes means and how they will impact their work. The new leaders of the enterprise must demonstrate thoughtful and decisive leadership, articulating in clear terms the new vision for the enterprise and, from there, sharing with each work group and employee what is expected of them. The new leaders must secure buy-in from the personnel, as well, and where there is not any, find replacements. Then they must avail to the personnel avenues for short- and near-term feedback. Opening immediate channel for communication is a good approach, because the manager must assure that the goals of his strategy are being met and, if they are not, make corrections where necessary.
- Score early victories. This can mean nearly anything, from restructuring debt to securing new financing to successfully winding down costly operations. Through small achievements, the manager and his turnaround team can act to demonstrate that their strategy is viable, and they can maintain the necessary support to go forward. To that end, though, it is understandable that larger goals may not be fully accomplished for some time. Nevertheless, the manager can still claim early victories. That is because, while the manager’s overall strategy is made measured by goals, the progress made in achieving those goals can be quantified by benchmarks. In goal-fulfillment, these benchmarks represent reference points by which the performance of the enterprise, its manager, and his turnaround team can also be evaluated over time. Therefore, it is necessary for the manager to report this progress to the stakeholders, in order to maintain their support for the strategy, and to the personnel, in order to bolster their commitment for achieving the goals.
In a troubled enterprise, turnaround management can make the difference, forestalling an untimely demise and restoring the prospects for growth. Of course, even renewal takes time, but with a competent team and the right strategic mix of options, most enterprises can be pulled back from the brink, if the turnaround team is permitted to act quickly enough. In order for that to happen, though, before all else, the stakeholders of a troubled enterprise have to admit to themselves and to their current managers that they need help from outside. Such an admission never comes easily—but, alas, overcoming prideful decision-making is a subject for a different time.
© 2010. All Rights Reserved; Axiom Strategy Advisors, LLC. Reproduction and unauthorized use are strictly prohibited.
Gary C. Harrell is the founder and managing principal of Axiom Strategy Advisors, LLC. For additional information, please write firstname.lastname@example.org.
By Gary C. Harrell
For a small business, expanding into new markets can be an exciting time. This is particularly true when the new market is a foreign one. But, for all the excitement, a great amount of attention must be given to the way in which products are traded, promoted, and placed in these foreign markets. One misstep, one detail overlooked, can result in lost goods, non-payment from buyers, compromised intellectual property, or even reputational risks. Therefore, managing every stage of the export process is critical.
When it comes to safeguarding a business against the risk of non-payment, an entrepreneur-cum-exporter should consider trade credit insurance. This type of coverage is used by businesses of every category and size, and though only three percent of exporters used it in 2016, recent political events like Brexit, trade difficulties between the United States and China, and a swathe of business failures is making the coverage more popular. In fact, many banks increasingly require export receivables to be insured if such receivables are to be considered as collateral for credit lines.
Contingent on the breadth of coverage selected by the exporter, trade credit insurance policies may cover between 60% and 95% of the debt owed by a foreign buyer, if such coverage applies to specified circumstances resulting in the buyer’s non-payment, i.e., political instability or business failure. For this reason, it is advantageous for an exporter to seriously consider the risks posed, both, by the buyer and in the buyer’s market, before selecting the appropriate coverage for the transaction. What’s more, unlike most other types of coverage that policyholder put aside until they must be used, with trade credit insurance, the exporter must report to the insurer as the first shipment of goods or services is dispatched to the buyer; the exporters must commence the payment of premiums; and the exporter must remain in regular communication with the insurer.
While private insurers do offer trade credit insurance to well-heeled exporters, a good number of them do not make the coverage available to small businesses. For this reason, the Export-Import Bank of the United States has stepped into the gap, providing coverage in areas deemed too risky by private insurers. Of course, though, there are a few restrictions when using the EXIM Bank:
- The business must have at least one year of operational history.
- The business must have at least one full-time employee.
- The business (and, in many cases, its owner(s)) must have a positive net worth.
- Fifty percent or more of the costs of the contents of the goods or services to be shipped must originate in the United States. (This can also include indirect costs such as labor or administrative costs.)
- All goods must be shipped to their destination countries from U.S. ports.
- Goods and services must only be shipped to eligible countries.
- The goods typically cannot be inclusive of arms or munitions for military, commercial, or civilian uses, unless the “dual use” of such goods can be clarified and approved prior to their sale.
Entering foreign markets can be an exciting time for a small business owner, because doing so can mean the growth of a brand and the diversification of revenue. But foreign markets come with their own set of challenges, and those are not limited to languages, topography, logistics, laws, customs, or tastes. Managing these risks requires a comprehensive understanding of the new market and proper preparation for exporting to it – not simply a casual desire to do so. Trade credit insurance is but one many facet of that preparation, and it can be a useful and reassuring tool for helping new exporters reduce possible risks in unfamiliar markets.
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Gary C. Harrell is the founder and managing principal of Axiom Strategy Advisors, LLC. For additional information, please write email@example.com.
© 2018. All rights reserved; Axiom Strategy Advisors, LLC.
Written by Gary C. Harrell
25 June 2016
The rules governing the way Axiom Strategy Advisors and other intermediaries raise capital have changed in both substantive and procedural ways. For years now, this consultancy has worked in the deal-making space, helping to raise much-needed equity capital for many businesses. The bulk of that financing – that is to say, the financing that had not been secured from close angel investors, or from the friends and families of the entrepreneurs – had come from either institutions or accredited investors. The latter investor type, accredited investors, are those individuals or married couples with a net worth in excess of $1 million. In accordance with old rules, those were the only players in the game. Intermediaries shopping private placements, or making public offerings, were not permitted to market startup equities to, or raise funds from, non-accredited investors, the other 98% of folks. Now things are different.
In 2012, passage of the Jumpstart Our Business Startups Act (commonly known as the “JOBS Act”) set the stage for how small businesses and their solicitors could raise equity investments from the non-accredited, alongside the more affluent investors, and in its own effort to protect this new class of investors from unnecessary risks, the Securities & Exchange Commission crafted a series of new rules and procedures that took effect over recent weeks.
This primer is intended to make clear for our clients the new landscape of equity crowdfunding, as well as to offer cursory guidance on how fundraising, hereinafter, will be carried out.
Let’s start with the basics.
The new rules set in place by the SEC will allow a small business to raise as much as $1 Million over a twelve-month funding period, and those same rules do open a wide door for non-accredited investors to take part in these fundraising opportunities. Nevertheless, the decision-makers in these small businesses and their intermediaries must remain mindful that these opportunities cannot be initiated without a good share of paperwork, mandatory disclosures and filings, and upfront expenses. What’s more, these fundraising opportunities are subject to scrutiny based on the oversight provided by the SEC and FINRA. Consequently, every effort must be made to work within the parameters given.
What you should know:
- Title III of the JOBS Act does allow small businesses to solicit equity crowdfunding from non-accredited investors over a fundraising-campaign period. That period is twelve months, based on the SEC rules.
• The maximum amount of capital a company can raise, based on these rules, is $1 Million over the fundraising campaign.
• Companies seeking to raise funds from non-accredited investors are restricted to no more than 500 non-accredited investors. Should the number of non-accredited investors exceed this threshold, the SEC will require that the company go public. Also, any Title IIIcompany with assets of more than $25 Million will be required to go public. (Taking a business public is a topic for a different memo.)
• Non-accredited investors are allowed to invest between $2,000 and $100,000 in a Title III company during its fundraising campaign.
• In order to raise funds during the twelve-month period, a small business eligible for a Title III designation can only use two intermediary platforms to make solicitations. First, a company can retain a broker-dealer, like Axiom Strategy Advisors, which is a FINRA-registered group or individual who, among other services, structures the offering, drafts all necessary investment and marketing documentation, and provides investment-management services during the fundraising campaign, while also working with and securing investors. Alternatively, a company can utilize a funding portal, which acts as an independent clearinghouse, whereupon startups can be matched with prospective investors, after they have upload all proper documentation about their company and the offering. (Unlike broker-dealers, funding portals, by law, cannot insert themselves into the deal-making process. They do not structure or draft the offering documentation, and they cannot help to identify investors or to lend advice.)
• There must be a 21-day “cooling off” period for prospective investors. That is, the Title III company and its solicitors must wait no less than this period before closing any investment pledge made during the fundraising campaign.
The procedure for initiating equity crowdfunding:
- First, the intermediary is required to conduct thorough background checks on the decision-makers of the company, as well as perform audits of the operations and financials of the company, in order to verify that there are no irregularities.
• The broker-dealeror lawyers for the company must prepare the proper offering documentation for the fundraising campaign. These materials are inclusive of, but not limited to, business plans, offering memorandums, subscription agreements, operating agreements, and so on.
• The intermediary must file a Form C with the SEC, announcing plans to raise capital under the Title III designation.
• It is imperative to remember that, at no point, can the company’s decision-makers or its intermediaries promote the fundraising campaign before the campaign actually commences!
• Once the nod is given by the SEC, the Title III company can commence the fundraising campaign over the approved period of time.
• The intermediary or representatives of the company must provide regular updates on fundraising efforts to the SEC, in addition to making these updates readily available on the company’s website.
For any investor, identifying start-up businesses with a strong likelihood of success is not an easy endeavor. Even venture capitalists, the most seasoned of all startup investors, encounter high failure rates – as many as 3 of every 4 VC-backed companies. On a larger scale, according to Bloomberg, 80% of all new businesses end up shuttered. Consequently, the chances of a non-accredited investor identifying and investing early in the next big real-estate deal, Google, Amgen, or Panera Bread could be quite slim. Nonetheless, should a non-accredited investor never have had the opportunity to identify and invest in such opportunities, then the chances of being part of something great would have surely been nonexistent.
The SEC has established a framework, however stringent, by which equity crowdfunding can be made a meaningful conduit for investment. Still, the onus is on the investor. It is important that non-accredited investors, much like their more affluent counterparts, give very careful and informed consideration to any opportunity before them, by conducting thorough research and due diligence of their own. Spotting a bad investment early on can save an investor thousands of dollars and many regrets. And by that same token, it is important for Axiom Strategy Advisors to use these new rules to deliver to the market only those opportunities worthy of investor’s hard-earned money.
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Gary C. Harrell is the founder and managing principal of Axiom Strategy Advisors, LLC. For additional information, please write firstname.lastname@example.org.
© 2016. All rights reserved; Axiom Strategy Advisors, LLC.
As a trade war looms between the United States and China, the news out of Beijing is particularly interesting. Officials with the People’s Bank of China acknowledged that they are considering a devaluation of the yuan (or the renminbi (RMB)), in an effort to stymie the impact of the Trump tariffs on their exports to the United States. The strategy is mystifying, and if it actually executed, it just might work for them.
To call China a trade giant is an understatement. It is actually a trade behemoth that manipulates masterfully (more on the latter point in a second), exporting over $2 trillion dollars in goods and services globally. Consumer, commercial, and industrial markets in the United States, of course, make up significant destinations for those exports. In fact, sticky geopolitics notwithstanding, the United States and China share a pretty robust trade relationship. In 2016, trade between the two countries totaled nearly $650 billion. And, yes, for that same year, China did benefit from a roughly $385 billion trade surplus, relative to the total value of goods and services exported to China from the U.S.
The yuan, China’s currency, is pegged to a basket (or formula) of 13 major currencies, with the U.S. dollar now representing just under 25% of the weight of its basket. In order to remain an attract destination for the production of goods, the Chinese smartly realized that it had to keep, both, its currency from appreciating in value and its economy from freely heating up as a consequence of all of this new business.
The strategy that China uses to maintain some control is often referred to as the “impossible trinity”. No country can have free capital flows in its economy, a fixed exchange rate, and control of its monetary policy, at all times. China enforces strict capital controls in its economy. For example, citizens of China and ex-pats working there cannot freely exchange their yuan for any foreign currencies. And that is an important fact to remember when you think of the Chinese consumer, who is not spending much of the money that he has earned after working long hours in that demanding economy. (Even if you hear a lot of glamorous stories about young Chinese splurging on European cars or pricey flats, just know that it’s not everyone. In fact, the Gross Savings Rate as a percentage of China’s GDP is 50%, making the average Chinese household far, far more frugal than its American counterpart.) Consequently, as the people of China save more and more, that money gets invested into more projects (like real estate) and production capacity, even beyond what is necessary to meet domestic demand. In the beginning, much of that money went into building factories, and those factories exported their excess production to markets willing to receive cheaper goods, thus creating the types of trade surpluses that we now see with the United States and the European Union.
By the AxSA Staff
14 November 2017
The best-performing and most adaptive businesses are typically very diverse ones. That is because #organizations that make diversity an integral part of their #culture benefit greatly from a freer flow of ideas, while also operating in more open and exploratory ways. These diverse businesses do a better job at strategic thinking, trendspotting, problem-solving, structuring opportunities, and even identifying and managing risks, largely because #groupthink does not narrow the judgment of their leaders.
Unfortunately, for so many smaller businesses and their #decisionmakers, embracing the notion of #diversity can be daunting, if only because a diverse talent pool can rattle the current #workplace culture and unsettle the perspective of staid #managers.
“We weren’t ready,” explained an AxSA who requested to be unnamed. Though the business manager wanted to protect her anonymity, she agreed to allow use of her story for the purposes of this missive. Her family-owned restaurant hired its first outside manager – a middle-aged, white male with ten years of experience – in 2012. Almost immediately, there were problems. “You would have thought that being people of color or people who knew something about prejudice, we would have been more accepting, but what happened exposed a lot of prejudice, both, in our ownership and in our staff.” That manager lasted only eight months, and quit following a racially-charged argument with another worker in the kitchen. An EEOC complaint followed quickly.
Decision-makers hoping to make diversity work to their advantage must start with the right mindset, lest a faulty attempt at diversity can have negative consequences. Here are some pointers:
○ Dispense with preconceived ideas, and keep an open mind
○ Seek out the most qualified candidates for job positions, ideally, from the start of the business
○ Create a culture of inclusion and mutual respect
○ Encourage openness, #teamwork, and the exchange of ideas
○ Actively mediate clashes based on cultural assumptions, and make clear that the company frowns on intolerance
○ Acknowledge that others might have good ideas that differ from your own
○ Be patient, and listen to those who might express their ideas in unfamiliar accents or styles
Contention often prompts decision-makers to think that diversity initiatives may not be worth the headache, but a diverse workplace demonstrates a significant degree of managerial and cultural maturity. And that diversity can bring benefits. For one thing, it resists conformity and encourages new #ideas in a time when creativity, innovation, and #performance shape the success of every #business.
Written By Gary C. Harrell
31 July 2017
Let’s start this missive with the kind of sobering admission that we all know to be true: many businesses – in fact, most businesses – do not work out. As we noted last year, according to statistics from the Small Business Administration, one-third of all new businesses close their doors within the first two years of operations, and half of the remainder, beyond that, do the same within their first five years. These statistics accurately point to the fact that, in spite of the best-laid plans, many entrepreneurs, whether new and experienced, find themselves making one of the most grueling decisions of their lives.
The decision to shutter a business for good is typically a financial one. Even still, the closure might have emotional ramifications on the business’s owner. An entrepreneur can be devastated by this loss, and there is an overwhelming sense of defeat, particularly as he recounts the possibilities that could have saved the business. What’s more, if the losses sustained by entrepreneur are great, the risk of the entrepreneur withdrawing from the world and sinking into depression can be equally real and just as concerning.
While there is no easy way to tell the owner of failed business that he should cheer up and prepare to move on, Axiom Strategy Advisors feels that it is important that every entrepreneur be equipped with the tools necessary to overcome the uncertainty and emotional challenges that might follow a business closure. Indeed, we recommend an entrepreneur prepare himself in five areas, in order to reduce the stress that will come in the long days and weeks following a closure:
1. Sources of Optimism
It is very easy to succumb to pessimism in the wake of a business closure. An entrepreneur may feel, among other things, drained and embarrassed, and he may simply not want to do anything for some time. After all, he has just shuttered the physical manifestation of his dream. Consequently, he may even begin to question the viability of any his other dreams or aspirations. But he should not do that. The best way for an entrepreneur to restore his hope in things to come, along with faith in his own abilities, is to find competing sources of optimism. He can look to things like his family, his hobbies, his civic involvement, and other personal interests as barometers for measuring his effectiveness and ability to still contribute to the world. As they preoccupy his time, these personal interests can also serve as the motivators necessary to galvanize the entrepreneur back into action.
2. Support System
Everyone needs a support system – and in the wake of a business closure, no one more so than an entrepreneur. In fact, being able to speak candidly to others helps the entrepreneur gain perspective, and it prevents him from bottling up difficult-to-process emotions. While family members and friends are acceptable outlets, it is extremely useful for an entrepreneur to include like-minded professionals and, when appropriate, mental-health clinicians in their support system. Those with experience in dealing with these challenges will offer the entrepreneur the best way to navigate through uncertainty.
We do not always win. We cannot always win. In fact, our moments of failure in life are just as common as our moments of success. That is perhaps the hardest realization for anyone to accept, let alone the entrepreneur – a man who stakes copious amounts of time, energy, and treasure on the physical manifestation of a dream. And so, when that dream proves unsuccessful, the entrepreneur might resist the notion that the failure is not personal, but it isn’t. It really just happens, irrespective of person, as would any social or behavioral phenomenon, and of course, there are times, statically speaking, when the risk of that failure is just greater, particularly for the adventurous and the intrepid, for the creative and the enterprising. That said, entrepreneurs are well-served to consider the words of Albert Einstein: “A person who never made a mistake never tried anything new.”
4. Objectivity & the Lesson of the Moment
Oprah Winfrey called failure, quote, “another steppingstone to greatness”. This is a description that should resonate with an entrepreneur. We all make mistakes, and some of those mistakes can be quite costly. Nevertheless, it is very important that an entrepreneur have the presence of mind to exploit even a difficult moment for what it is worth, by taking the opportunity to identify the lessons to be learned. For the owner of a failed business, the practice of taking a moment to step back, reevaluating the circumstances that led to such failure, and processing the lessons from those events are more than just about gaining perspective. These can become life-lessons that help to pave the way forward.
5. A Fresh Start
From the start, an entrepreneur possesses a unique sense for identifying opportunities that few others recognize, while also mustering the courage to act on them. That superpower is not lost in the wake of a business closure. In fact, it is just as keen as it would have been on the first day, when the entrepreneur originally conceived the idea for his first business. Consequently, it is very important for the entrepreneur to approach the next chapter of his life with the same confidence and zeal that enabled him to move forward in the past.
To the general public, business closures seem to occur swiftly, almost overnight, and in an orderly manner. We consultants and a world of entrepreneurs know differently. When a business is headed to its closure, it takes a long and agonizing march filled with unexpected twists and turns – glimmers of hope, waves of disappointment, moments of contention, and weeks of endless, new questions. Indeed, each day is more painful than the one before it, and each turn chips away at the veneer of a once-hopeful, once-determined entrepreneur. To that end, there is perhaps no greater evidence of the destructive consequences of a business closure than the toll it takes on the people involved, particularly the entrepreneur.
Understanding this, Axiom Strategy Advisors takes great care in working with entrepreneurs facing the decision to close a business. This is also the reason we elected to share these points. We hope to stress a singular message to entrepreneurs who, in the end, need to be reminded to remain positive, open, adaptive, and driven.
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Gary C. Harrell is the founder and managing principal of Axiom Strategy Advisors, LLC. For additional information, please write email@example.com.
© 2017. All rights reserved; Axiom Strategy Advisors, LLC.
Most people may have never heard of Chris Brown, the former mayor of Hawthorne, California, but this gentleman is one of the guiding forces in that state’s politics, working behind the scenes with local governments and private business to craft effective legislation.
Mr Brown is a dealmaker – one of those individuals bringing two or more parties together, in order to identify common interests and execute beneficial strategies for both sides. His experience as a business owner and politician gives him the unique perspective necessary to successfully close deals in this space.
Becoming a consistently successful dealmaker is not a matter of luck. Brokering deals requires knowledge, patience, objectivity, and prescience. Here are a few characteristics that foster proven outcomes for dealmakers like Mr Brown:
— Dealmakers cultivate broad and action-oriented networks.
— Dealmakers study their subject matter, while seeking access to superior #information, and they are able to identify #trends likely to shape their environment. They understand that knowledge is power, and that is often their greatest advantage.
— When necessary, well-connected #dealmakers are able to bring disparate parties together. For example, they activate their channels to potential buyers or sellers of goods, or they identify sources of #capital for the financing of ventures.
— Dealmakers understand that disparate parties have their own motivations, and that they must communicate effectively, relying on facts, objectivity, and #diplomacy, in order to bridge those parties. What’s more, dealmakers never lose sight of their own interests in a deal. (Triangulation is key.)
— Dealmakers must have the proper infrastructure for facilitating a deal. For example, in order to execute a transfer of goods, the dealmaker may be responsible for arranging shipping, or in order to execute a buyout of assets, the dealmaker may be responsible for conducting a third-party valuation.
— Dealmakers must have access to the resources (i.e., capital, talent, etc.) necessary to complete intermediary responsibilities in a deal. It does a dealmaker no good to negotiate terms on which he cannot follow through.
— Dealmakers must be comfortable with their unsung-hero status. Because structuring and negotiating #deals can be a messy and long process, many dealmakers prefer to do this intricate work behind the scenes and away from public scrutiny. Indeed, for some of the best dealmakers, #anonymity is a virtue.
(c) 2017, All rights reserved. Axiom Strategy Advisors, LLC.
When it comes to setting goals, we hear frequently someone paraphrasing that instructive quote by superstar athlete Bo Jackson: “Set your goals high, and don’t stop [until] you get there.” Those words – or maybe a variation of them – seem simple and inspiring to most of us. But there is an ugly truth that follows them. You see, while everyone of us is an expert at setting lofty goals, the truth is that a disappointingly high number of us never achieve them, usually because we just give up on them.
That is not an easy fact to digest, particularly in times like these, when it is sexy to call ourselves entrepreneurs, or when we speak and post so boldly about how hard we are grinding, or when we drown ourselves in memes, literature, podcasts, and pricey workshops for much-needed motivation. But it is true. Too many of us are not living up. In fact, just consider one 2015 statistic from U.S. News & World Report: by now, just a few short weeks into this new year, approximately 80% of all resolutions made on or before January 1st have already fallen by the wayside. So much for bright, new beginnings.
As we all know from personal and professional experiences, setting the goal is one thing, but keeping that goal in focus is no easy feat. It requires that you marshal skill sets and reallocate resources in a way that reflects new priorities. Time may be needed. Discipline may be needed. Effort may be needed. Talent may be needed. Money may be needed. And – to be fair to ourselves, let’s face it – all too often, something in that mix may be at a low level or not present at all. Consequently, while you really may have wanted to accomplish this new goal, it could seem that your current reality has not afforded you much room to make it possible.
When it comes to keeping your goals in focus, we understand the challenges many people fact. And so, we recommend the following pointers:
- It’s okay to set a lofty goal – but keep your feet on the ground.
- Err on the side of specificity. The more detailed the goal, the strategic you can in its planning.
- Make sure that the goal is measurable. Being able to track your progress in a quantifiable manner is important.
- Understand your reality gap. That is, you should comprehend the distance from where you are in your current reality and, as it pertains to the goal, where you would like to be. This will help you establish a realistic timetable for the achievement of the goal.
- Have a clear understanding of your “why”. Ask yourself some probing questions. For what purpose do you want to achieve this goal? How important is that purpose in your current scope of priorities? And after this goal, what comes next?
- Know what is needed to achieve your goal.
- Take stock of the resources necessary to commence work on, and maintain progress towards, the goal.
- If something is lacking, determine where you can get it, and how long it might take you to do so. Then adjust your timetable accordingly.
- Plan and write a lot.
- Transform the initiative that you will undertake into a comprehensive plan, wherein you will have a clear understanding of the goal, the timetable for its completion, the utilization of resources, and your milestones.
- Use those milestones, such as deadlines or mini-goals, to keep you accountable to your plan and to track the progress to your larger goal.
- Writing everything down. The practice of journal-keeping will help you to visualize your goals in words and diagrams.
- You need a support system.
- Identify someone with whom you can share you goal and be open about your progress. Be sure that it is someone with whom you can be transparent and from whom you can take constructive criticism.
- There are going to be a lot of negatives. Know them. Avoid them.
- Do not procrastinate. Without knowing it, you can become your own worst enemy, finding one excuse after another to put off what you need to do, and then, at the last minute, you may be able to deliver your best work.
- Do not be easily distracted by people, events, or things that arouse your attention in the short term and that usual have no connection to your efforts. Remember that time waits on no man or woman, and you are not afforded the luxury of tacit commitment when it comes to achieving your goals.
- Do not be swayed by the negative opinions of others. Your goals are your own, and they must stay that way. When someone outside of your circle of influence offers an opinion about a goal or efforts that do not pertain to them, ignore the person, and continue to do your best to achieve your goal. After all, there is no better victory than to suffocate them under the sheer tonnage of your success.
- Get to work.
- Do not wait for permission to get started. There is no one there to give it.
- Commit the time that it takes to achieve your goal within the reasonable timetable that you have set for yourself.
- Adhere to your deadlines and mini-goals.
- Use proper time management, to take control of how your time gets used each day.
- Make your work a habit, until and even after you have reached your goal. It only takes 21 days of consistent effort to turn your effort into a routine that can yield results upon which more effort can be exerted.
The goals we set for our lives are usually meant to improve us. We see them as avenues for new opportunities and growth. But most times, we can lose focus of these goals and why they matter, and with quiet disappointment, or with a bevy of excuses, we just give them up.
Fortunately, none of us should wait for a new year or a new week to start setting new goals and commencing the work to make them real. Indeed, any moment can be our turning point. We simply have to set specific goals, understand their importance, and have the courage, the desire, and the foresight to achieve them.
Now believe. Then start doing.