Small Business Cash Flow Concerns Drop to Pre-recession Levels, According to the Spring American Express OPEN Small Business Monitor

NEW YORK--(BUSINESS WIRE)--Entrepreneurs remain confident about business prospects, but their top priority continues to be maintaining current sources of revenue. Cash flow concerns have fallen to pre-recession levels (49%, matching fall 2007 and down from a high of 66% in spring 2011). In addition, fewer business owners say they are “stressed-out” by the economy (56%, down from a high of 70% in spring 2011) and more feel confident in their ability to access the capital needed to grow their businesses (72%, the highest figure since the question was first asked in 2002).

“The recession’s silver lining is that small business owners have become more adept at navigating an uncertain economy, gaining valuable experience and putting it into practice along the way”

This spring, small business owners are on a better path to achieving their long-term goals. According to the American Express OPEN Small Business Monitor, 54% of small business owners say they are on track to save for the retirement they want (up significantly from 37% a year ago) and fewer (65%, down from 73% a year ago) are worried about setting aside the estimated average $1,170,000 they say they need for the retirement they want.

Small Business Growth Pursuits Are Well Within Reach Despite Economic Uncertainty

Regardless of the economic climate, growth plans are still in the cards, as:

  • Small business owner optimism is holding steady with more than half of them maintaining a positive outlook on business prospects (54%, unchanged from last spring)
  • Fewer say the economy has had a negative effect on their business and its survival is in jeopardy (13%, down from 18% last spring)
  • More than seven-in-ten plan to grow their businesses over the next six months (72% on par with 74% last spring)
  • More than half (55%, up slightly from 50% a year ago) of business owners plan to make capital investments over the next six months

“The recession’s silver lining is that small business owners have become more adept at navigating an uncertain economy, gaining valuable experience and putting it into practice along the way,” said Denise Pickett, president, American Express OPEN. “While they remain optimistic and confident in their ability to manage their businesses, entrepreneurs are realistic that challenges may arise and look beyond themselves – recognizing the importance of community and networking – understanding they do not have to go it alone.”

As they look to expand, small business owners report that they appreciate the importance of connecting with peers and becoming part of a like-minded community.

  • Eighty-one percent say they make it a priority to meet new people for their business
  • More than two-thirds of entrepreneurs (68%) say membership in a community of growth-focused business owners would be helpful in growing their businesses
  • Nearly four-in-ten (38%) say “connections”-- understanding the power of networking as a key to running a thriving business are most important to be able to grow

Hiring Flat, Productivity Up; Social Media Expert Trumps Accountant as Most Helpful New Hire

Examining the linkage between growth and hiring:

  • More than three-quarters of business owners (76%) say they hire as needed when the business grows, as opposed to hiring in order to grow the business (just 14%)
  • Hiring plans (35%) are on par with last spring (31%)
  • For those that are hiring, a social media expert is the most sought after position (12%, up from 9% in spring 2011), surpassing accountant/bookkeeper (11%, down from 14% in spring 2011)

With hiring lower on the priority list, business owners recognize the value of their current employees especially as they serve customers:

  • Nearly all (98%) say providing good customer service is essential to their business success
  • More than one-quarter (27%) say their business mantra is “you are only as good as your people” followed by “the customer is always right” (19%)
  • Three-quarters (75%) say they communicate openly with employees about the health of the business
  • Sixty-eight percent of business owners say the productivity of their workforce has increased over the last year (up from 60% last spring)

Social Media Usage on the Rise; But Many Find it a “Time-suck”

Business owners continue to look for cost effective ways to reach customers:

  • An increasing number are using social media for their business (58%, up from 46% last spring)
  • Among all entrepreneurs surveyed, more than four-in-ten (43%) say they plan to increase their company’s focus on social media over the next year
  • While nearly three-in-ten (29%) say social media has helped their business survive in a challenging economy, more than half (54%) find it to be a “time-suck” or a burden
  • Those entrepreneurs currently using social media use it for a variety of reasons including:
    • To attract new customers (66%)
    • Drive sales (49%)
    • Create customer dialogue (46%)
    • Gain insights from customers (41%)
    • Create communities where customers can talk to each other (29%)

The secret to true happiness? Ask an Entrepreneur

Significantly more business owners say they are:

  • “Very happy” with their lives (69%, up from 56% a year ago)
  • Women entrepreneurs are more likely to be “very happy” (73%, vs. 66% of men)
  • Overall eight-in-ten attribute their happiness entirely or somewhat to being an entrepreneur (80%, on par with 76% last spring)

Additional survey results including findings by industry, geography and gender are available by contacting Alex Della Rocca at 212-539-3203 or alexd@mbooth.com.

Survey Methodology American Express OPEN Small Business Monitor, released each spring and fall, is based on a nationally representative sample of 1150 small business owners/managers of companies with fewer than 100 employees. The anonymous survey was conducted via telephone by Ebiquity Research February 24-March 18, 2014. The poll has a margin of error of +/- 3.0%.     

Growthink's Luke Brown Selected as Mentor for SXSW V2V!

Congratulations Luke - what an exciting opportunity for you and the great entrepreneurs attending!

Announcing Our First Batch of V2V Mentors: Register Now to Meet Them in July

Written by Jessica Cox | April 24, 2014

Mentor Photos

After such a successful SXSW V2V Mentor Program in 2013, we are thrilled to announce our first batch of confirmed Mentors for the 2014 event. This is really an impressive crew of thought leaders from a variety of industries across the country. No matter where you are in the process of pursuing your dreams, we have a mentor that has trod the path before you and will help you tackle the next steps. Our extensive Mentor Program is the cornerstone of SXSW V2V, designed to provide you with the support, advice and expertise to take your idea to the next level.

We congratulate and welcome our newest Mentors to SXSW V2V:

Danny Fraser, Head of SEO at Romman Inc 
Frank Gruber, CEO & Cofounder of Tech Cocktail 
Jennifer Peck, Director of Media Relations at Banjo 
Joseph Kozusko, President & Founder of FreightStop 
Kimberly James, Owner of CBM Records 
Luke Brown, Senior Engagement Partner at Growthink Inc 
Marcus Daniels, Managing Director at Extreme Startups 
Mark Drosos, President of Lodestone Social Media 
Marta Voda, Talent Acquisition at Viacom 
Megan Adams, Director of Communications at Knock Twice LLC 

Look out for more SXSW V2V Mentor listings to come, and keep your eye on the V2V website for more information on how to reserve your time with one of these 100+ all-stars!

V2V badgeholders have the exclusive opportunity to meet with these stellar Mentors, so if you have yet to register for the event, do so today before the price increases on Saturday, April 26.

Have any interesting people to suggest for the SXSW V2V Mentor Program? Please don't hesitate to contact us at any time.

Post written by Kathryn E. Irwin. 

Photo by David Fox.


Rock the Vote - Growthinker Luke Brown at SXSW in Vegas!

Growthink Team and Fans of Growthink, 

Please help our very own, Luke Brown, get selected to speak at SXSW in Vegas this July!

http://panelpicker.sxsw.com/vote/28854

Votes need to be cast today, but takes just a few minutes to do. 

This a GREAT and growing 3 day conference that was born from the success of SXSW in Austin and would be phenomenal opportunity for Growthink to engage with great entrepreneurs that could use our help!

Thank you for your support!

Melissa


4 Systems Jack Daly Says You Must Have to Build an Amazing Culture


By Kevin Daum

You can't have a successfully growing company without a solid, sustainable culture. Master coach Jack Daly has finally put the keys to building an incredible culture into his wonderful new book, Hyper Sales Growth: Street-Proven Systems & Processes; How to Grow Quickly & Profitably.

Management is often told to build a great culture, but do they really understand what it means to do so?

Daly clearly defines culture as the unique personality of your company--the people, the environment, the "feel." Great companies build it with intention, because, as Daly says: "You can't fake culture." Culture does more to bring great people in, keep them there, keep them happy, and keep them working longer and more productively than any other factor. Daly points out that to have a successful business you must create an environment where people want to go to work vs. have to go to work. Daly's motto: "Put the F word back in business. Make it FUN."

Daly rightly observes that many business leaders will design and articulate an ideal culture but never actually install the systems and processes needed to make sure it gets started and is upheld. Below are the four systems Daly says you need to build a killer culture.

1. Systems for Recognition

Daly explains that the people who work in your company should feel recognized and valued, from the very first day they start work. He suggests you should never start new people on a Monday, when things are unorganized and hectic. Instead, bring them in when things are humming and make their first day a day to remember.

With your existing staff, small but regular gestures go a long way. Recognizing milestones, achievements, and good efforts at any opportunity is sure to make someone feel valued and connected to the company. Recognition doesn't need to be expensive, but it needs to be personal. Make sure you tie your rewards as best you can to desired actions. As Daly says: "You get the behavior you recognize and reward." Imagine if today an outsider stood in front of your employees and asked, "By a show of hands, how many of you are overly recognized?" Put systems in place that ensure a full room of hands up.

If you can only do one thing differently tomorrow, Daly says: "Recognize the people you work with directly and win their hearts."

2. Systems for Communication

Many companies get by, day after day, without building specific communication systems. But as companies grow, this approach results in people problems and systemic breakdowns. A top complaint employees make in HR surveys is "I wish I knew more about what was going on."

Lack of consistent information breeds confusion, fear, and resentment. Daly advocates establishment of some simple systems of communication between management and employees that will get everyone on the same page. Teams and departments should check in daily. There should be larger monthly, quarterly, and annual check-ins. Establish policy and practice where bad or difficult news is proactively brought to the table. Daly preaches that the best policy is to shoot straight and don't spin. Most importantly he points out that everyone must learn to listen: "We've heard it often: two ears, one mouth, for a reason."

If you can only do one thing differently tomorrow, Daly says: "Shut down your inner voice and start being an active listener."

3. Systems for Personal and Professional Development

Daly says potential employees want to know why (besides a paycheck) they should come to work in your company and current employees need to know why should they stay. The best people see their careers as more than just salary and perks. They care about the overall experience they're going to have while working each day. They want the opportunities for growth and development that can only be fostered in a growth-oriented work environment.

Great employees want to become smarter and more productive in their careers. Their objectives are aligned with yours, so make the investment in them. Construct or pay for training that makes your employees better at their technical and people skills. Invest the time and money to cultivate your employees and you'll end up with skilled and loyal management that will happily expand the company for decades.

If you can only do one thing differently tomorrow, Daly says: "Discover the visions each of your employees have, and work to blaze a path for them."

4.  Systems for Empowerment

Daly explains how you can leverage the growth of your business by empowering your people. He stresses that a growing company needs active decision making by everyone, not just the CEO. But it's not as simple as telling people to make decisions. If they don't feel confident they have tools and authority, they will hold back and defer back up the ladder.

Daly says: "To truly empower your employees, you must create an environment where people feel comfortable making decisions, as if they were the owner." It's hard to build this empowerment all at once. If your culture is clearly defined and aligned, your people will know what action to take.

Every time you give over authority, your employees grow stronger. If they are rewarded for taking right action on their own, that behavior will expand. Put protective systems in place giving them the opportunity to fail safely so they can learn from error.

If you can only do one thing differently tomorrow, Daly says: "Give people power to succeed and fail on their own so they learn and grow."

VC Investment Hits 13-year High

money-tree

Venture capitalists invested $9.5 billion last quarter, the highest total since the dotcom doom's waning days.

FORTUNE -- No, it isn't your imagination: Venture capitalists are investing money at a faster clip than in any time since the final days of the dotcom boom.

VCs pumped $9.5 billion into 951 U.S.-based companies last quarter, which was the most money invested in any quarter since Q2 2001, according to MoneyTree survey data published today by PricewaterhouseCoopers, the National Venture Capital Association and Thomson Reuters (TRI). The dollar figure represents a whopping 57% increase over Q1 2013, while the deal number is nearly 4% higher (12% increase in dollars and 14% decrease in deals from Q4 2013). Or, put another way, average deal sizes are skyrocketing.

The quarter included nine rounds of $100 million or more, led by Dropbox's $325 million raise from back in January (a deal that may actually be a bit larger).

Not surprisingly, the leading industry sector was software with more than $4 billion invested. It was followed by biotech with $1.06 billion and media/entertainment with $743 million.

From a geographic perspective, California-based companies led the nation with a whopping $5.46 billion raised for406 startups ($4.6 billion of which was in Silicon Valley). Massachusetts placed second with $960 million raised by 88 companies, while New York had $754 million raised by 97 companies.

It's also worth noting that MoneyTree's reported VC investment pace over the past couple of years has easily outstripped VC fundraising (as reported by the NVCA and Thomson Reuters). But it really isn't an apples-to-apples comparison, because the investment reports include monies disbursed by non-traditional sources like T. Rowe Price and Fidelity (i.e., big later-stage players), while the fundraising stats don't account for those capital pools (only traditional GP/LP venture structures).

Growthink Client Dr. Kevin Forsythe - A Hero Entrepreneur!

One of the great things about Growthink are the amazing and inspirational clients we work with, especially in the healthcare space. Dr. Kevin Forsythe of the Oregon Urology Institute is a real entrepreneurial hero - in addition to having a full-time workload as a radiation oncologist and a young family, Kevin in his "spare time" is working on cutting edge treatments and tools for prostate and breast cancer.  Quick Facebook shoutout to Kevin and to the dozens of amazing healthcare-focused entrepreneurs that make our world a healthier, happier place.