Stop worrying about the credit market…get creative

Tom Schlafly is one of the most successful business people (and human beings) I have had the pleasure of talking to. He built the St. Louis Brewery in the town that has…um..you, know… THE Brewery. However, since InBev came to town, Schlafly now enjoys status as St. Louis largest locally-owned brewery.

As Tom points out in his witty column Top Fermentation, “In any discussion of local industry in St. Louis, Schlafly is now The Brewery.” The irony is thicker than the head on one of Tom’s stout winter brews.

The man who:

• claims that he “would never have started his business if he knew anything about business”
• attracts an entire team of people with liberal arts degrees and no business background
• had to change Missouri laws on microbreweries to grow his business
• holds an irrational love for St. Louis
• continues to bring a creative wonder to his business

…is now wildly successful against all odds and in the shrined shadow of a St. Louis darling – Anheuser-Busch.

Entrepreneurship is a lifestyle choice and a way of thinking differently about:

• what it means to be in business
• what it means to have success
• what it means to be professional

Many times at the root of this decision (to rip the employee label off your life and think in this manner) is a very emotional and peculiar drive. As my friend Richard Sacks (author, consultant and entrepreneur) puts it, “most entrepreneurs are on plan B.” They are creative, innovative, passionate people who got ticked off at the way that their industry was working, or feel that some population is grossly underserved.

If there is this distinction between an entrepreneur and a manager or executive, then why do entrepreneurs constantly feel they have to behave like the rest of business world when it comes to financing their business?

I have heard many entrepreneurs complain:

• The banks don’t take me seriously.
• I don’t have the right contacts.
• The credit market has dried up.
• Venture capitalists aren’t giving out money.
• Angel investors are watching their portfolios dwindle away.

This reaction to our current economy is not an irrational response. This is fear-based thinking that will be a secure lockdown to any growth that your business could hope to have.

To survive the slowdown and the limited access to capital, you must see this fear, name it and move along on the path.  You must be irrational. (For more on this see Dixie Gillaspie’s article on moving through fear.)

You are an entrepreneur…be creative. Here are some practical steps that I have seen the best entrepreneurs take to make long-term financial goals. (All of these steps were taken assuming that you had the right attitude, have had solid business ethics and want to grow your business.)

• Get skin in the game. This is a battle. If you can’t stomach a big personal loss, you may need to find a job. While it does not sound pleasant, I have yet to meet a financial backer who is comfortable taking on all the risk. Collect up your capital and what you have of value. If it was a comfortable process, then everyone would do it. Two retailers I know have doubled their business in the last year by leveraging collateral to get credit.
• Negotiate and make terms with your vendors. Make it as simple as possible. “Hey, things are slowing down for me. Can I pay you $x amount per month?” Most folks will allow you some latitude.
• Find easy ways to monetize what you do. This is dangerous because you may end up going down sales paths that can distract you from a primary purpose. What do you do already do that adds value and you can easily charge for? This could be scaled-back versions of a larger service for a reduced rate. However it looks, find new ways to make money at what you are already doing.
• Find like-minded folks that share your vision. They may not be instant sources of money, but you can certainly find advise, empathy, friendship and accountability. The monetary value of true friendship is immeasurable. The most successful people that I know found and inner circle that they went to in good times and bad. You start finding these people by becoming an approachable person.

It may seem as though the universe is conspiring against you, but take a look at Schlafly’s situation 17 years ago. You do not face nearly the odds that he did. He made it. You can too. It may not look the way you thought it would, but your company will be better for it.

And, if you are a St. Louis-based entrepreneur, then you have access to at least 49 growth opportunities that are unique to your city.

TRY THIS ONE ON:

If you wanted to hear what it was like for a passionate, eccentric business owner, then read Tom Schlafly’s book, A New Religion in Mecca. There is a great deal of hope in there. It seems that Schlafly contends that the universe conspired to make his business successful, but, someone who knew what she was talking about once said: Luck is the residue of rigorous, persistent action.

- Jeremy Nulik, Creative Energy Officer, St. Louis Small Business Monthly

Time wounds all heels…especially in a tough economy

This morning I heard a story that I did not expect to hear.  It was about a St. Louis company that was seeing an increase in business despite a tough economy.

Adam Allington of KWMU reported on local St. Louis cobbler, Jeff Lipson owner of Cobblestone Shoe Repair.  Jeff is a third generation cobbler, and, with the economy the way that it is, he is a very busy.  Give it a listen: Cobbler’s Business Steps Up During Thrifty Times

Here are 4 things that I thought about on the remainder of my commute to work:

1. Maybe those small business owners have the right idea. Here we have Jeff the cobbler.  It would be much more convenient if his name were Joe.  He provides a simple service to complicated people – business executives, mostly.  He is not plotting a hostile takeover or deciding whether or not to bail out the auto industry.  He is fixing shoes.  Right now, among his largest concerns is making sure that he has the infrastructure to handle the scale of business he has right now…pretty good problem to have.  As Allington points out – “He’s glad he’s fixing the shoes of corporate executives and not standing in them”…this is an understatement.  If there is one benefit to this on-the-cusp-of-a-recession economy, it is that the risk of being an entrepreneur and pursuing your passion is equal to the risk of a “safe” corporate job.  This economy needs people who are not afraid to build something.  Really, it is the truth no matter what the economic situation, but the rough time just exposes that truth.
2. Being on the radio allows you to say things that you would never usually say. Take, for example: “Waste-not, want-not…brewhaha.”  Now that is some artistic latitude…or it could be balderdash or it could be my cockamamie excuse to use archaic terms…like “archaic.”
3. Americans are slow…uh…learners. There is nothing like a little pain to learn a lesson, but this report points out that really, things aren’t bad enough yet.  The Great Depression was much worse, and our economy is different now.  So, we would make habits like getting a $15 repair instead of buying $150 shoes more common if things just hurt more.  I call this the toothpaste tube phenomenon.  When my kids get a new tube of toothpaste, they tend to smash it in the middle using much more than necessary.  We end up with toothpaste on their faces, in the sink, on towels, counter tops, etc.  As the tube gets more empty they are suddenly able to perform the same task of brushing their teeth with a fraction of the toothpaste.  This economy and thriftiness is thrown out the window the moment a new tube of Disney-themed toothpaste is introduced.  Adults behave in the same way.  When the economy gets better, whatever that means, I am sure that many of us will go back to our irresponsible spending…and why not?  well, don’t worry.  People like Jeff who have built a strong legacy business will be around the next time tough times hit.
4. Strange how the things that can help our environment are somehow just more economically sensible. I know a lot of folks who resist the idea of “going green.”  They wonder what impact their habits actually have on helping the planet.  But, in this world, it may be less to do with environmental thinking and more to do with just being a good citizen.  My parents always had us reuse towels once or twice and always shut lights off…why? Because they cared about the environment? No…they are frugal and didn’t want to be wasteful for comfort’s sake.  It seems that the universe has some ethic out there.  Some kind of cosmic please-don’t-throw-your-Styrofoam-out-the-window force.  Maybe getting your shoes repaired is just good green karma.

LET ME KNOW:

Do you know someone else who has a locally owned business that is doing well?  I would love to hear stories about people who are growing despite the circumstances.  Send them to me or leave a comment.  Also, check out the December issue of Small Business Monthly…we will feature companies that are thriving and hear from experts in St. Louis on how to keep growing through tough times.

HERE IS ONE FOR FREE:

If you got to this page because you were searching for Cobblestone or shoe repair, then take a look at Jeff’s Shoe Car Tips…stay true to your sole, or take time for heeling, or think of a more cheesy metaphor and email it to me.

Keep fighting the good fight, Jeff.

- Jeremy Nulik, Creative Energy Officer, St. Louis Small Business Monthly

PS – Jeff is a son of a son of a cobbler…ah, I feel a Jimmy Buffett moment coming on despite the chilly weather.  Also, if the cobbler’s son is without shoes, then what is the status of footwear for the cobbler’s grandson? Alright…I’ll stop now.

It really is all “about you”

So, they (whoever they are) say that you should give credit for using someone else’s words or ideas the first couple of times you use them and then, after that, those ideas are yours.

One idea that is not quite mine yet is the About You page. I shamelessly stole this idea from my friend Adam. He writes about my theivery here. I got the idea from a story that he wrote for the Small Business Monthly.

Here is what creating an About You page did for me and what it can do for you or your company’s literature:

• Took my eyes off me. So many times, when I am asked to talk about myself, it tends to make me uncomfortable. Rather than put myself or my company through the interview process or discuss features and benefits of Jeremy, Inc., I would rather think about you. It puts me at ease.
• Made me think about who you really are. This exercise forced me to think in some detail about who in world would find value in something like this blog. The “about you” exercise has given me a framework for what to leave out of the blog as much as it has informed what to include.
• Gave me the perfect forum to talk about me since I’m talking about you. The things that I say about you actually tell you more about me than if I just tried to write about myself (if you followed all of that, then you may need some psychiatric help…don’t worry, I know someone). You get to know me better by my description of you and the things I value about you.

This simple exercise has broad applications for companies and organizations. At the outset of a project, website, new product or service, ask yourself what information would be on the “about you” page. Who is this serving? Who would find value in this?

Stephen Covey says to “Begin with the end-goal in mind” and the “about you” execise does just that. It forces you, your team or organization to look outward to what effect you hope to achieve by first figuring out who it is for.

Having the humility to take the eyes off yourself and think about your target audience – their fears, desires and needs – can do nothing but make your next idea or project more successful.

Thanks, Adam. Keep the good ideas coming. There are plenty of theives like me willing to harvest.

HOMEWORK

The next time you feel the urge to start a new project, whip out a blank piece of paper and a No. 2 pencil. Begin to write the About You page for that particular idea. The real strength of the “about you” exercise comes from the process of doing it. Your customers, readers or team members will thank you.

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Jeremy Nulik, Creative Energy Officer (CEO), St. Louis Small Business Monthly