Up and Running:

There’s trouble in eBay land for entrepreneurs. If you’re already doing business with eBay, you probably know this already. If you’re not there yet, but you’re curious about it or thinking about it, you probably want to click over to eBay Live–So Why Is Everybody So Upset, Anyway? on StartupNation. That post is a collection of videos, with a summary, that highlights the problem very well.

I was shocked to see how things have gone. I was at eBay Live last year, in Boston, and although it seemed a bit slower than the year before in Las Vegas, it was still pretty much hopping. I had to miss the annual eBay sellers’ event this year, and I’ve been busy with other things, so I didn’t realize how bad things have gotten.

(With thanks to Steve King of Small Biz Labs, who posted eBay Sellers Express Their Unhappiness.)

Three weeks? Sure, why not? I know very well one business that started in a single day. Here’s that story, from my Planning Startups Stories blog. It’s about Palo Alto Software, which now has more than 40 employees, more than 70 percent market share in the U.S. retail market, a subsidiary in the UK and a new management team.

I also posted about this three weeks idea last April in “Can You Really Start a Business in Three Weeks?,” also in Planning Startups Stories. I said it depends a lot on the business: how big, how technical, how much financing it needs, how many people are involved, etc.

Today, as I focus in on the final edited version of our new book 3 Weeks to Startup, I’d like to look at this again. Our editors have asked us to go back and build the timeline, realistically, to prove the point that you can do this. I think we can do that easily.

Here’s what we suggest as the stuff of week one.

So that, for most businesses at least, is what I’d suggest for week one of the three weeks to startup. You may notice that I’m skipping over some of the market research that many people would say is vital. I’m saying, in contrast, that if you already know your market and what you’re going to offer, and why and to whom, then you’re like a lot of other entrepreneurs. You’re not going to do a big market research project. So let that one go unless you need it. And as I suggest in the table, if you need it, you already know who you are.

So this is week one of the three weeks to startup. Week two of three comes in my next post.

I invite you to tune in to WDEL, 1150 AM in Wilmington, Delaware, or to join via internet radio at www.wdel.com, where I’ll be a guest of host Rick Jensen for his daily talk show. The topic is starting your own business, sort of–I had a nice talk with Rick yesterday. I suspect he’s going to let that topic drift a bit, to baby boomers, retirement or not, recession, starting a business during a recession. That’s just a hunch. Here’s how Rick announced it on his blog:

Call-In Line: (302) 478-9335

Thinking of ways to make a little more money as the cost of everything goes up? Do you have an idea for a part-time business? Talk with Tim Berry, president and founder of Palo Alto Software, founder of bplans.com, co-founder of Borland International, author of books and software on business planning, Stanford MBA. He’s done it, written about it and teaches how to get it done.

Talk with Tim at 2:07 p.m., tomorrow, Wednesday, June 25th!

That’s 2:07 p.m. EDT, so 1:07 Central, 12:07 Mountain, and 11:07 a.m. on the (good ol’) West Coast.

Everybody talks about the three P’s of marketing, and lately four P’s and even five in some lists. They have to work a bit to maintain the theme: Channels of distribution becomes price, for example, and marketing becomes promotion. Still, it’s nice and easy to remember. Or is that product, price and promotion with distribution becoming place?

I started out to write this post about taking care of yourself as you go about getting your business up and running. And as I wrote the first lead for it, I was talking about three P’s: passion, perseverance and priorities. Or four, adding people. And then persistence is a good word, too.

This comes up because I worry about how much we in the startup world go on about passion and perseverance, as if we are nothing but focused, build-my-business-no-matter-what entrepreneurship machines. It’s part of the mystique, the mythology of entrepreneurship: Stick to it, work harder, stay focused, make it happen.

Except that we don’t talk enough about the real priorities in life. Do you live to build your business or do you build your business to live? Are you following that passion so obsessively that you’re forgetting the people you live with? Do your kids know your name?

Quick reminder: Nobody’s last wish is to have spent more time at the office.

I may be guilty of one of those do-as-I-say-not-as-I-did moments with this post, but I’d like to think, as I look back on 30 years with startups and in startups, that I was at times motivated by wanting to have the freedom to coach the kids’ soccer team or to post on my blogs and to write an occasional book; and this just doesn’t happen without keeping track of your real priorities.

This reminds me of a small but delightful surprise I registered the first time I looked at one of Jane Applegate’s books on small business. I worked with her as a business ally for a while in the 1990s. The happy surprise was picking up her book on small business success and seeing that she started out, the first chapter, with a reminder about taking care of yourself, getting enough sleep and spending enough time with your loved ones.

More recently, I noted that John Jantsch has a short piece about exercise on his main blog. Jantsch is somebody I respect and admire, so I was happy to see him sharing some practical advice on this point, even though it had nothing to do with marketing (or very little). In The Math of Exercise he wrote:

That’s the number one complaint I hear from small businesses–I just don’t have enough time to do it all.

Well, I’ve found a magic way to get some time back each day. It’s not a marketing tip, but since I’m thinking it might help free up some time to do more marketing, it’s fair game.

The secret to getting more time each day is to invest some in exercise. I know you know that and don’t need me to tell you how to live, I just know that every single day I get some exercise I get more done. Mind you, I don’t do it enough, but I can tell you that investing 30 of the 1440 minutes I have in a day in exercise always doubles up and pays off.

So that’s priorities. Keep your priorities straight. Keep your people, preserve your life (hey, there are two more P’s), and remember that those priorities are as important as your passion and perseverance.

The fourth P? That’s your planning. Planning keeps you sane. It starts with defining success, then goes on to steps to make that happen and, we hope, a good planning process means you keep your eyes on the long-term goals while managing all the short-term stuff at the same time.

So darn, I’m getting all wrapped up in P’s now. Let’s summarize:

• Priorities: Define your success first. What do you want from your business? Don’t get lost in the business unless you really, really want to. (Tangent: Some people do want to get lost in the business; they’re in the office because they don’t want to be at home. Is that you?)
• People: Do you care about your people? If you’re going to take yourself away from them to build a business, give them a choice. Don’t tell them you did it for them.
• Passion: Yeah, it’s important, because you can’t do a business right without believing in it.
• Perseverance: Sigh … yeah. Tough, but, oh well.
• Persistence: OK, now I’m just doing P words for no good reason. Popcorn? Pantaloons? I’ve always kind of liked paraphernalia, because it’s so hard to spell.

And then there’s point. In this case, the point is take care of yourself first. You can’t build a business right if you get lost in it and lose the rest of your life. You’re not what your business card says you are.

It’s hard enough to set a name for your startup. But it’s much harder when you sweat the domain name too much and let it clog the creative process.

Thank goodness, when we renamed Infoplan Inc. to Palo Alto Software, Inc. back in 1988, we didn’t think about the domain name issue. My familiarity with the internet at that point, to be honest, was as a group of weird AppleLink addresses, associated with academics, that had the @ right in the middle of them. Instead, as we decided that Infoplan was too hard to market and we discovered that Palo Alto Software was not in use as a corporate name in California, we just did it. It said Silicon Valley, it said Stanford University, and we lived in Palo Alto and had offices in Palo Alto. So that’s what we named it.

I say thank goodness because we weren’t confused by the domain name factor. We just named the company. It took us until late in 1994 to catch on with the Internet. When we did, paloalto.com wasn’t available (we bought it years later, so it’s ours now) but we made do with pasware.com, bplans.com, bizplans.com, and a few others. I’m very glad I also registered timberry.com at that time too; and some of my kids were glad I registered their names, too.

This comes up because I watch more startups these days, and I see them sweating over making the company name and the domain name both work, both be exclusive and also be coordinated. That’s really tough. And then there are product names and service names, too, which makes it even harder.

My suggestion is that you separate the two problems. Get a company name that works–more on that in who owns your business name on my other blog–and leave the domain name for a while. Factors that make your company name work include practical legal ownership, ease of use, ease of marketing and branding, and simplicity, to name a few. Then get a domain name that works. Factors that make a domain name work are ownership, of course, and a different kind of ease of use (is it easy to type and hard to misspell, for example), and a different kind of marketability (easy to remember, easy to defend).

I’ve been in some naming sessions in which we forgot some of the basics. Amazon.com isn’t books.com, and Yahoo! and Google meant next to nothing when they started. But they were short, easy to remember (well, sort of–I had trouble with Google for about half a minute) and, essentially, easy to market.

When the Internet became important, Palo Alto Software started on the Web as pasware.com, because paloalto.com wasn’t available, and we decided pasware.com was better than paloaltosoftware.com (too many letters). Palo Alto Software was a given; we had already been using that name for eight years. We did evolve, though, to paloaltosoftware.com for a while, and palo-alto.com for a while and, eventually, after buying the domain name, paloalto.com.

As long as the domain name is memorable and marketable, you can make it work.

A few months ago I wrote a post about Brent Bowers’ column in The New York Times, following three startups as they–we all hoped–grew and prospered. Last week Bowers revisited the three startups and came back with a fresh and not altogether happy new view of startup reality.

None met all their goals, but Ms. Adler came the closest. She has built her cafe to $8,000 in revenue a week, up from $7,000 six months ago. But that is still $3,000 shy of her projections. She also expects to begin making a profit this summer, an impressive achievement for a new restaurant.

Ms. Ericson, by contrast, has scaled back her ambitions to create a Web clothing store that doubles as a portal to an Internet center for women. She instead has spent most of her time making cold calls to boutique shops to sell her “Mama says” T-shirts.

And Mr. Takle, just back from a trip to India to recruit low-cost legal talent for his property management software company, says that while he remains hopeful, his venture is foundering. “It’s getting dangerously close to needing investors just to survive, which is a bad place to be,” he said.

There’s not a whole lot of good news there, but not a lot of surprise either. Sales are lower than projections, and the three entrepreneurs are troubled, but resolved. Click here for more …

At the Princeton business plan contest earlier this month, David Johnson, advisor to VCs and a VC fundraiser, was asked whether being involved in a failed effort would rule out an entrepreneur from future funding. His answer:

“Failure is not a problem. It’s a good thing to know what that feels like.”

At a venture competition some years ago, in the judges’ meeting before it started, the judges went around the room introducing themselves. We talked about our companies and our successes. Ty Pettit, an entrepreneur and fellow judge from Portland, Oregon, opened his introduction with the following (paraphrased):

“Probably my best qualification to judge this competition is that I’ve just finished mopping up a company I ran into bankruptcy and had to close.”

Can we talk about startups without contemplating failure?

I think it’s important to understand that failures happen. With good planning you minimize the chance of failure by doing some counting ahead, knowing what’s required and what’s at stake. But don’t ever bet what you can’t afford to lose.

Those four people are the cheerleader, the role model, the expert and the techie. I liked this piece by Rich Mintzer posted yesterday on Entrepreneur.com. Good stuff. Here’s the link: The 4 People Every Business Owner Needs

Imagine yourself in a conference room, presenting your business plan to potential investors. How do you answer the question: “Where’d you get that idea?”

This comes to my mind today because of a post I read yesterday on Ask the VC. An e-mailer asked what it means when investors ask that question:

Are they looking for an emotional and inspiring story or are they worried that we may have taken our idea from someone else or, what I believe is the case, do they want to see if we were driven by an opening in the market that we observed?

Jason Mendelson answers that question, from the VC’s point of view, in his post “How Did We Get the Idea for Our Startup?” Yes, inspiration and emotion are nice, he says. And yes, a great new market is even better, for obvious reasons. However:

“Taken Our Idea from someone else”–This is a big one. If you come and pitch a next-generation social networking site and previously worked at Facebook, we are going to have an in-depth discussion. Maybe you didn’t steal it, but maybe your former employer will have a claim on the intellectual property developed while you were employed.

That last one is one that I’ve run into more than once, in reading business plans and consulting. When entrepreneurs are employed already in the same industry, that sends up red flags.

And I also enjoyed Mendelson’s last couple of possibilities. Maybe the VCs want to see how well you pitch an idea, giving you a stage to play on; or “perhaps it is just a trite icebreaker and the VCs are just asking you this so they’ll have time to answer e-mails on their Blackberry while you wax poetically.”

The discussion reminds me of the critical scene in the 1988 movie Working Girl. The old guy asks the two women where they got the idea–a contested idea, where ownership is being argued. One of them just hems and haws. The other reconstructs the thought thread in detail, with references to news pieces, gossip and other connections. Guess whose idea it really was?

I had a very interesting lunch meeting today with Derek Brandow and Jason Gallic of the YBGroup. That’s also YottaByte Group, and it’s about changing our education system. Ask yourself: What does technology have to do with education? Think of a 15-year-old kid you know. Outside the class, it’s cell phones, IM, SMS, Facebook, and so on. Inside the class, it’s essays, math homework, tests, start the period with a bell, end it with a bell . . .

“But wait a minute!” I hope you’re saying, the one world has nothing to do with the other. What would texting have to do with education? Hmmm . . . what’s wrong with this picture? Why does the one world have nothing to do with the other? Does that make any sense at all?

Gallic and Brandow are building a business plan around their way to prepare young people for the world the rest of us live in, using the tools the rest of us use, with processes (like collaboration, for example) similar to what the rest of us use. Seems like a good idea to me. I’m looking forward to getting more details, but from what I heard today, this is a business, with a business model. Not all far-reaching ideas to change education have to be nonprofits.

And, by the way, I love stories as a way to communicate, and I love the way their website tells a story to help us understand what they’re after. And I mean really tells a story, as in A fictional account of a YB student. If you’re interested in this, read the story.