The rational need not apply

The vast majority of wealthy people you meet acted on their gut instincts to get wealthy. They bought property or shares when the market was hot, they acted when everyone else hesitated even though the evidence was there for all to see.

You can’t plan to be hugely successful using any rational processes we are taught in business. In my experience, the more you have studied business, accounting or finance, the less likely you are to take risks. And by definition business is about taking risks.

I meet people who use their star signs to make a decision. I meet people who call in Feng Shui masters, or rely on spiritual signs like a bird landing on their fence when they are pondering a decision. The more I meet entrepreneurs the more I realise is that the one thing they have in common is that none of them have much in common apart from not being common.

In the end decisions get made, risks get taken and some of them pay off. Once you start off on the path of making decisions you find out some succeed and others don’t, but you are more willing to take risks if you have already taken risks and succeeded.

If you approach everything rationally it means that you will need to attribute some kind of probability to outcomes, and to do that you will need to actually have some means of measuring those probabilities. Guess what – not even the experts are good at that.

Ultimately every decision made in business is made on how much loss you are willing to take in case it goes wrong, and it is often the non-rational side of things that cause the decision to be made.

The more you are in this game the more you learn to fine tune what your gut is telling you – this is called experience, and you only get experience by actually doing things.

So, whether you are looking to get into business or you are looking to expand your business, the key is to try different things. Either it will work out or it won’t. Have a go, you might surprise yourself.

Raising capital is like dating

They are both brutal, demeaning and demoralising processes. Rejection is constant, having your hopes built up and then dashed again is part of your daily life. You are on a roller coaster you can’t afford to get off. It can also be a lot of fun if you go in with the right mind set.

Here  are some of the key similarities.

Up your game

You need to learn how to sell yourself in a way that attracts the kind of people you would like. Just like filling in a profile on an online dating website – you are going to have to put together marketing material and have a pitch ready at all times.

You need to show respect and put on your A-game. Appearance and packaging are important no matter how good the product or your team.

Expect Rejection

Just like when asking people out - a lot of people are going to look at you and your company and just say no. Rejection and pain will be your constant companion. You are constantly asking yourself, “why don’t they like me? Am I doing something wrong?”

You need to make the first move

After being rejected you may be shy about asking others out – which is a mistake. They may like you, but not be aware you are interested. This is the same with investors. If you don’t let them know you are out there looking and receptive to their interest then they aren’t going to offer. You need to make the first move.

Create openings for them to imagine being in a future with you

That initial attraction may fizzle at the first date. You need to have more than just an idea on PowerPoint, and you need to leave room for the other party to imagine how they can bring more than just money to the table. They need to be able to believe they can work with you.

Chemistry is important – but doubts may persist

Even after a few dates, consummation may not occur. You may be sending out signals, or not sending out signals about things that the investors are looking for. Who knows, there is chemistry at play here.

Pay attention to those who pay attention to you

One fundamental I’d like to leave with you is to never ignore someone who pays attention to you out of their own initiative. You can spend months chasing someone you like, but you need to pay attention to the ones who like you.

To put that even more simply, if somebody who has money to invest pays you attention you need to give them your full attention. There is a chance that they may be the only one to give you a chance for a while.

We all hear the stories about hi-tech companies where the CEO holds out for a better deal and then gets it. In dating terms they are like the supermodel who has no shortage of suitors and will look for the right partner. Are you really a supermodel? It’s one thing to have the attitude of one, but an empty bank account and maxxed out credit cards may help you change your mind.

The Ibis and the Seagulls

 A business parable  showing that experience and brains make a difference – trying hard is just not enough.

I was at the waterfront recently and saw something I though was a great parable for those of us in business.

A discarded McDonalds’ bag lay on the ground in the middle of the park. A flock of seagulls descended on this bag in the moments after it was discarded– they obviously knew that it was likely there would be leftover fries in there and they wanted them.

First one seagull pecked at the bag, then the second, and within half a minute there were 8 seagulls energetically pecking away at the bag.

A while later the seagulls were still pecking away at the bag, a little more slowly now, when a long legged ibis casually walked over (he’d come from the other side of the park). The ibis stood still for a moment, contemplated the scene, then casually walked over to the top end of the bag, stuck it’s long beak in the opening and pulled a few fries out.  He then got out of there fast before the seagulls could snatch the fries from him.

The moral of the story is – recognising an opportunity is not enough, and nor is enthusiasm and energy – you need to know what to do with it.

Why are cloud services so hard to understand?

Do you know what an hour of small instance compute time is? Neither do I – and I am no more enlightened after reading definitions for it. The IT world is losing billions of potential sales dollars by badly pitched services.

As one of the many millions of small and medium size businesses out there I am very happy to use cloud services and software as a service (SaaS) in order to make work and life simpler. To speak for small business owners everywhere – I spend a lot of my time setting up IT and sorting out IT problems. What I crave most in life is simplicity and reliability.

Some services are easy to understand. For example I have gotten rid of the need for an email server by using Google Apps – which also allows syncing across devices. I look forward to seeing Microsoft’s solutions as they finally roll out Windows 8.

For online storage Dropbox, Sharefile and others make life pretty easy – with some limitations.

And here is where we reach some of grey areas of the world of IT that haven’t figured out how to talk to non-IT types.

Like many business owners I really appreciate the per user pricing for SaaS. However, there comes a point where I want to look at a solution for the larger number of employees I have, and hit a brick wall in terms terminology.

I would love to have a scalable cloud based server – however, I realise now that even though I have been using the word ‘server’ for most of my working career, I actually don’t understand what a server is in a technical sense.

For me, like most people, there is the H: drive which is set up on my computer so that we can all save our files into a single location, open the files, edit them, save them, and even log on from a remote location. I believe this is what is called a file server.

Rackspace explains things in a relatively straightforward manner – but prices by the user rather than GB.

Windows Azure is powerful I know, but the marketing is written for IT geeks. E.g. “Load balance any number of Web Sites across private VM instances dedicated to your apps.”  Whisky Tango Foxtrot?

Amazon isn’t much better – “Amazon Elastic Compute Cloud provides the flexibility to choose from a number of different instance types to meet your computing needs. Each instance provides a predictable amount of dedicated compute capacity and is charged per instance-hour consumed.”

So, as far as I can tell, cloud services are marketed at large corporates with dedicated IT departments, startups with lots of IT savvy staff, or at personal use with massively dumbed down sales messages.

Dropbox may have a solution for Ted who’s about to travel around Africa, but it doesn’t tell me how to run my business more easily yet. I'm running a small business, not joining the Peace Corps.

Here’s my shopping list for the average small to medium size business (and remember, there are millions of us). Our defining characteristics are that we are time poor, intolerant of vapour ware, wary of non-mainstream platforms and need to be shown how something works before we trust it.

Let’s start with a shared drive (file server) based in the cloud. 

• I want a shared drive that I can use to open, edit and save documents easily. I want to set it up as an H:Drive or equivalent under Windows. If I need to sync I can just save a working copy to my C: Drive and then copy it back later. Full syncing can come later.
• I want to know that shared drive is backed up and recoverable.
• I may need to know where the data is stored in order to comply with privacy laws in my country (e.g. Google will host your data in Europe rather than the US in order to meet other countries more stringent privacy regulations).
• I need to be able to set access to those drives. For example, HR records and accounting should only be accessed by those who really need to know.
• I need to know what the up-time is and what security is for your service.
• I will get shirty if the typical maintenance time on servers at your end is convenient for US customers but affects me during working hours.
• Ability to access from mobile devices, etc. is great.
• Pricing – I am happy to pay by the user to a point. After that I would prefer to pay by the GB. Most of us aren’t multimedia intensive creative agencies who chew up massive amounts of drive space with videos and music. We mostly produce Excel, Word and Powerpoint files and after a certain level of monthly cost we start to get pissed off with your per user pricing.

Emails 

• Google Apps offers a fantastic service. Zoho and others also offer good hosted email plans.
• Outlook webaccess is good, but I hate using it compared to Gmail based solutions.
• Again, I am happy to pay based on users to a point- but then I would like pricing based on disc usage/bandwidth used.

  

Web hosting

• In case you hadn’t noticed, there is a rebellion against walled garden CMS’s. A lot of companies are moving to WordPress as their website and content management system – and there is a reason for this – it is cheaper, easier to modify and easier to update than most CMS.
• We are also sick of being told we need expensive graphic design packages, that we need to host it with the site developer at a premium, and we are particularly sick of being told we need to pay a lot of money to access our stats and put in SEO. You are using your technical skills to hold us to ransom, not enable us to be succeeding in a digital world.
• Google needs to get its act together on its own Google Sites and Blogspot services – they could, if they tried, take out a lot of website development and management. And hey, Microsoft – why aren’t you pushing the free version of your cut-down Sharepoint more aggressively and in language that I as a small business owner can understand.

And yes, there probably are some solutions out there that do some if not all of these things – but if it doesn’t come up in plain English on the home page of a large and reputable company then to me it doesn’t exist. Time to get your act together guys.