Keep Your Enemies Closes....So Go For The Student
Desk Of Drumlin S Boulder
Ever played 20 questions?
Back when my kids were young, we used to play this game on longer car
trips. You know, those lasting more than 10 minutes. In order to keep
the kids from fighting and screaming, we'd ask them to pick a character,
real or from TV, and we'd have 20 "yes or no" questions to guess who
that character was. It made for great fun sometimes as the characters,
questions and guesses got out of control.
All those memories came back the other day when I was invited to help
judge a business plan competition at our local college. Now they were
great kids and all, and I'm a big advocate of starting young, but
getting at the core of some of their business concepts was quite a
challenge. The most daunting cases were presented by kids who used such
complex language, I just know they're going to make great bureaucrats.
To all you business owners out there who think red tape is a problem
now, just wait until this crop graduates! Most of the rest must have
thought it was OK for business plans to lie, as long as the lies were
detailed and precise lies rather than being vague and general.
But that's not all that was difficult to accept. The group leader
seemingly encouraged everyone to go out and make lots of mistakes
because, as he said, "experience is a great teacher and mistakes are the
best route to success". Now I agree failure can always serve as a bad
example, but my problem is the multiple hefty tuition costs, and, though I know
he was trying to make everyone feel better about failing, he was
actually advocating it as a building strategy! Would you bet on a serial
loser because you think his luck is about to change?
So I voiced a dissenting opinion. I started by saying I agreed
experience was great because it enabled you to recognize a mistake when
you make it again, and looked around to see if anyone caught my meaning.
But few smiled, so I decided I had to be merciless. I told them that
after spending serious time, effort and money screwing up, no one in
their right minds would back a serial loser's latest venture, nor,
unless they presented a sound plan with a high probability of success,
would anyone back anyone's first.
Which was in retrospect was prescient given some of the strange
justifications that came next.
The first plan was introduced as an opportunity for vertical integration,
which made me sit up to take notice. But it was at it's heart macabre
and a land play as if it knew the combination senior's complex, funeral
home and extensive graveyard garden combination could not be there
forever. The promoter said he would locate away
from densely populated areas to where land was cheap, to lower his
costs. Eventually, he said, when his business attained critical mass, he
would build a hotel for frequent visitors. He was confident because his
designs would have great Feng Shui. He also ensured me there was no
competition... which in this case should have actually worried him a
Others were quite clever. One sixteen year old, dare I say genius, took
the concept of creative accountants one step further, and based her
business on the premise that corporate annual reports could be sold as
works of art, and that collectors would soon be bidding up masterworks
from the likes of Nortel, Enron, WorldCom, and Global Crossing. She
called it "Abstractions by Auditors". She wanted money to assemble
available hard copies and begin dealing in them.
The key challenge for these kids, much as any entrepreneur looking for
financing, was to provide the materials and presentation that showed us
they knew their product, market, and execution strategy. And that they
understood that sometimes you're the fly, and sometimes you're the
So I'd brainstormed with Symon, who you know by now as our marketing MBA
whiz and Carrie Balance, our accountant. We prepared some really
intelligent questions, like what is the market potential for your
company's product or service? What is the revenue potential for the
industry, and what is its growth rate? How was it all determined? What
makes your business different or unique? Why would someone be compelled
to purchase your product or service? What specific needs does it
address? How do you plan to acquire customers? How do you plan to keep
One girl, Sarah, had it all. She based her market analysis on sound
research from Statistics Canada and other reputable sources, and
understood she had to compete by doing things better to gain market
share. Her numbers were based on operating assumption, like making X
phone calls a day by Y sales people to generate Z orders. She showed us
step by step how she was going to get to where she planned to be. She
knew what competed for her sales dollars...by companies and products,
and how these products were sold and why people bought them.
Sarah also knew her costs. I almost fell over when she said it would
cost an estimated $120,000 per year per employee and stressed this was
not just salary, but what it would cost for salary, benefits, office
space, a desk, a PC with legal software, a phone, to turn on the lights,
and the free coffee and pop. Heck, I'd never asked that question myself
so I filed that one away as a to do. Then she absolutely knocked me out
when she said her exit strategy was based on a trend she saw in on-line
digital storage of family photographs, and that she felt her company
would eventually be attractive to a digital camera company or to a cell
phone company banking heavily on cell phone cameras and transmission
I almost decided I wouldn't vote for her in case she actually ended up
going into business for herself... I mean, would you want to compete
with a powerhouse like that? Common sense, creativity, business savvy,
leadership....she had it all!
In reality though it was easy to vote for her. How can you vote for
those who'd spend $100 to acquire a customer who's going to spend $25
per year, or those who only needed to gain 5% market share....along with
the other 500 companies out there doing the same thing? How about those
who plan to compete by being the lowest cost producer...but have yet to
make anything? Oh and here's one. Would you pay shipping costs on 100
kilo boxes of mail order kitty litter? Neither would I. At least he
didn't offer to ship them for free.
So I voted for her and followed the old maxim... keep your friend close
and your enemies closer. I offered Sarah a summer job before anyone else
could, and she accepted. I'm hoping she's going to teach me a few