Staples High School Meeting

I recently met with the Principal of Staples High School in Westport, CT (where Miles and I both attended school before college) to conduct some market research to see if they would be interested in our product and service offerings. The discussion went well and he was pretty interested in our ideas. He was also excited to meet with me becuase he is some what of an entrepreneur himself as he just patented an invention for hanging picture frames. I might actually end up helping him develop a plan to get his product out into the market, so that is kind interesting. But anyway, he said that the Westport school system is actually actively searching for both of our products that we are looking to offer them. I was pretty estatic when he mentioned this; however, this also means that we have a limited time to capture their interest and sell them our services before they choose someone else. Since he doesn't make any of the decisions pertaining to the technology the school uses he directed to two people in Town Hall who are in charge. I really wanted to immediately head over afterwards, but I really want to prepare some sort of presentation or at least a brochure to leave them with. Its hard to start the selling process without an actual ready product to show people, but we plan to start soon anyway just to gain information on who would be interested and who would want to be kept updated on the status. So, once we have things a bit more together we'll likely present to them. If we do contract with them, we would likely be serving the whole K-12 school system. It would turn out to be a pretty substantial deal.

Textworks, LLC

I am excited to announce that we are officially Textworks, LLC!!!!We are also in the process of creating a name for the actual application and looking to get it trademarked. After doing some research, a trademark is just as easy to obtain and can be done through a service or registered by oneself through the United States Patent & Trademark office. You can also search for existing trademarks to see if your desired name is taken.

Limited Liability Company

We have just paid for the creation and registration for our business to become a Limited Liability Company. It is actually a very simple process and anyone can do it in a matter of minutes. We hired a business, bizfilings.com, to do all the paper work for us including obtaining a tax i.d. number. The first step is for them to check our desired name to make sure that name is not already registered as a business. When this name is confirmed we will then be able to officially release its title. An LLC makes any business a separate entity from its members or owners. This is important becuase it liberates owners from being personally responsible for the company's debts and liabilities. An LLC also allows pass-through taxation. This means that income is not taxed at the corporate level; however, a tax return must be completed. The pass-through taxation also means that owners must personally report any income or loss from the company and pay the necessary taxes. LLCs also have the following advantages:1. No ownership restrictions2. Flexibility in structuring company's management3. Reduced annual paperwork and formalities compared to S & C type corporations4. Written consent of owners must be obtained prior to increasing ownership of the company5. A more professional entity than a sole proprietorship or partnershipWe are excited to finally obtain the LLC and hope that we are able to use our first choice name. When forming an LLC, you need to consider what state you are going to register in. This is usually determined by the state you choose to do business in. The LLC must be registered in the state that you receive payments and conduct business in. If you operate in multiple states, then you need an "alien" registration in the other states. But what if you are an internet based company and you are receiving payments from all over the place? All that matters with this is that all of your payments flow through the same routing number to your bank account in your primary state. If it was the other way, you would have to be registered in all states. This would be very costly...Once we obtain the tax i.d. number we will be able to create a small business account at Bank of America. All of us will have separate checking cards and have equal access to the account. This obviously requires a lot trust; however, I feel that it is fairly easy in our situation because we know each other fairly closely. We will use this account to pay for all of our expenses and keep revenues in. We intend to reinvest a large portion of any revenues back into the business.

Ideas

Ideas...I always get excited about them, especially new and creative ones. In a sense, you can think of ideas as potential opportunities that can someone can take advantage of to add value to any given situation. Ideas promote progress and the evolution of society and technology. The success and forward progress of civilizations depend on new ideas such as inventions. People are constantly striving to develope new ways of doing things to increase the quality of life. Ideas help create new inventions, technology, industries, products, businesses, etc. The list goes on and on.These are my viewpoints on ideas. Whether you agree or disagree, I think we can all agree that ideas are important to some extent within any aspect of life and the world. I feel that brainstorming new ideas is very important in any entrepreneurial process. Afterall, an entrepreneurial endeavor starts with a simple idea that someone wants to build a business off of. But the process cannot stop there. There is no book or guideline that instructs you how to start the business, so you have to constantly be coming up with ideas on how you are going to build the idea, the product, launch the business, market the business, etc. What if the business or product fails or doesnt work as planned, well then you need back up plans. An entrepreneur should probably have some ideas on how to tackle that problem as well.We have currently been discussing various new ways to use our infrastructure to offer more products without large injections of increased investments. One of these ideas we are strongly considering and receiving additional quotes for. I am particularly excited about this service because we know there is a large demand for it, and if we execute it properly, then we can potential receive some relatively large initial cash flows that we can use to reinvest in the business.But overall, we are constantly brainstorming ideas for all aspects of the business. I could even go as far and name this stage we're in the "Brainstorm as many ideas as you possibly can stage." I agree, a little excessive, but I strongly feel that ideas are so crucial for any positive progression forward. You need the ideas before you can properly execute.

Testing the Market

I think it's important to know what you are getting into before investing valuable time into a project. Often times, I find myself sticking with a project because I have put forth a lot of energy and I just want to see it succeed. It's hard to turn away from something you are highly invested in. I think this is how Alex and I felt when we first started our painting businesses. Neither of us knew how much work it would be until we were actually doing it...and had we known, we may not have taken it on. There's a slightly different spirit with this business...I feel like we need to make it work at all costs and failure is not an option, regardless of how hard you know you'll have to work to succeed.Today, I wanted to get a taste for what our business would be like in the short future and how it was percieved be our potential clients. I set up a meeting with a prominent restauranteur in the Miami area whom I thought would be interested in advertising via our service. My goal was to present the services we would potentially offer him and get some feedback from him.I knew he typically owned trendy youthful locals, and thought he could benefit from targeting our users directly. He basically loved the idea. We discussed what his goals were. He wanted to bring a dynamic energy to his businesses and encourage patrons to come in for food or drinks as often as possible. I encouraged him to consider promotions on certain days of the week and to send out coupons via our messages for discounts on days that business might normally be slow. We talked for maybe 2 or 3 hours and agreed to stay in touch. He said he loved the idea, but preferred to wait until we had a solid user base that could guarantee a significant contribution/benefit to his bottom line...but then again, I expected him to say that. There are very few people who are willing to join a project unless it's already up and going.At the very least, it's a push in the right direction and a boost in moral for the business. Let's make this happen!!!-Nick

Some Updates

I will be leaving wednesday for a road trip to Tennessee to see Bannaroo. I am pretty excited. While I am gone, Nick and Miles will be working on a number of things. We just created an escrow account and will be uploading funds to that today and tomorrow. The funds will then be released over the next couple of days seeing that Ryan and Rohit have completed the tasks associated with the first phase. They will also be working with Rohit to answer his questions about our comments on the first designs so that they can get a better idea of what we want from the next set. The database and design architecture documents are also in the process of being reviewed. Although, we can't really comment to much on these because they mostly contain technical jargon. We are going to see if we can find a friend that is familiar with web programming to make sure the documents make sense.We have agreed as team that we will be all splitting equity and all costs associated with launching the business. Now that we have finally decided this we can obtain the LLC, a tax identification number, and create a joint small business bank account from where we will upload our investments and use to pay for all of our costs. On other news, Miles and I are glad that Nick will be an equal equity holder and founder, and that we have been able to better align all of our goals, expectations, and visions for the future. Nick will also start contributing to this blog shortly.I have sparked interest with our first potential advertiser, them being a real estate office that I will be working for part time. We have four other start ups that we may and will likely be affiliated with when we launch and possibly further into the future.We are hoping to call our company Text Works, pending on the availability of the name for LLC registration. Yet we are still trying to come up with an appropriate domain and application name.

Some Interesting News

So far we have had a couple of friends that have been fairly serious about the possibility of investing in our venture. But today I found another potential investor that caught me by surprise. I just finished selling a $3,000+ painting job and as a I was talking to the home owner and getting to know him better I found out that he is in the biotech software industry. Naturally, I started talking to him about software and related web start ups to build off of the common interest in order to build a better relationship. I then briefly discussed this venture with him, and to my surprise, he happened to like the idea so much he said he would actually consider investing in it later and that we should come to him if we needed some money. I was thrilled. It just goes to show how important communication is in this world, it helps open opportunities.

Leveraging

Leveraging is essentially the concept of creating a specific position in order to gain an increase in power, influence, or advantage. Leverage can be created in various different ways depending on what aspect of the world a specific situation pertains to. In physics, a simple lever is used to allow an entity to use less force over a greater distance to move a heavy object that one might not have been able to lift initially on their own. In the financial world, leverage is created by borrowing money to gain a larger return on investment. In the social world, people can have leverage over one another by having access to better and more abundant resources. Likewise, the same can happen in the business world.Creating leverage is very important in the entreprenuerial world because one wants to receive as much value and benefit as possible from taking on their already high level of risk. In other words, you want to increase your chances of succeeding as much as possible. Financing plays a large role in entreprenuership because it allows people to act on their ideas and create a new source of value to others. From this, it might make sense that leveraging acts similarly in both the financial and entreprenuerial sections of the business world. However, I thought about this more and came to the conclusion that leveraging in these two seemingly similar areas is actually quite different.In finance, creating leverage may increase your ROI if you make a good investment, but it also increases your risk of losing more money. Borrowing money creates the opportunity for either increased positive and negative leverage. Negative leverage meaning that if make the wrong decision, you are going to lose a lot more than if you didn't borrow or leverage yourself. The borrowing of more money, in a sense, increases your chance of succeeding in receiving a higher ROI. Receiving injections or funding of more money might increase an entreprenuers chance of succeeding by making resources more available, but it certainly does not gaurantee a higher return on investment. If anything, it might make it harder because you have to become that much more successful. The leverage that I want to talk about in entreprenuership has nothing to do with money. I feel that leverage in an entreprenuerial situation is created in a much different way. This kind of leverage, for the most part is positive and creates little or no increase in overall risk of losing money.I like to think of leveraging in an entreprenuerial situation as more of a positioning game to create more efficient and effective systems to launch, promote, and build a business. This I believe increases the liklihood of becoming successful and obtaining a higher return on one's investment. This is why we spend a lot of time brainstorming and attempting to create ways of combining ideas or services so that they can have a multiplied effect when applied. For instance, we aim to create our application so that it can be used and applied in as many different ways as possible. It is a useful program and has the potential to add value to other websites. So, we will be working towards creating an API version so that it can be integrated into any site. This also produces another form of revenue for just a small increase in investment and effort. Our site has the same target market as other products, so we are working on developing partnerships with other startups with products that can be easily integrated. As a result, our application will not only be launched by us, but by those people we have affiliated with. These types of relationships create synergy because it creates more exposure and produces more traffic for both parties. And, if these affiliates are launching at different schools, then it increases the number of schools that we will be able to launch at. We can also create a mutually beneficial partnership with our web developers. For instance, we give them leads that we find by simply networking, and in return we get a commission that can be seen as additional funding that can be funneled back into the business. By simply positioning ourselves and sharing an idea we are able to create a valuable byproduct that both businesses benefit from that required no additional risk and little time and effort. There are many other ways to create leverage such as networking with people in the same industry, utilizing contacts that may be able to save you money, discussing ideas with people to generate new ideas, using an already existing infrastructure to create new services, doing more research and becoming more knowledgable than your competitors, talking to your target market to gain feedback, combining two businesses with similar target markets, or simply communicating with others about what you are doing as much as possible. These are all things that someone can do while working on their venture that doesn't increase risk but increases the upside or likelyhood of succeeding. Simply ask yourself, how can I use time in such a way that creates a multiplier effect on your effort. Time is valuable, the way you spend your time determines how well you are able to execute. And your ability to execute has a large effect on whether you can grow a successful business. I wanted to write about this because Nick recently realized another way of using our service. Creating this new use would not take that much more money, especially since the infrastructure is already set up. What it does create is a new service that we can easily sell or offer people that we come in contact with. This increases our ability to impact and create more value for a wider range of people within or related to our target market. This blog is another great example of leveraging an idea. Although the blog is used to educate others who have similar interests and who would like to track the process of our venture, I am also using the blog to practice and improve my writing, promote our start up, and provide another avenue for people to get to know me. In summary, it is important to position yourself in situations where you can derive benefits in multiple different ways from one single action. We hope our focus on this strategy will aid in our success.

Our First Designs

We just received the first designs for parts of the website/application. Although it is not exactly what we want, we feel that it is a good start. It is important to realize with this type of process that it will probably never turn out exactly how you want it and that it will probably take multiple revisions. I am glad that our team understands that (so that we dont get frustrated) and that our developers realize the same. Sometimes it is hard to work in a group of three, particularly when it comes to aligning visions, ideas, and then integrating them. However, I feel that we have come up with an efficient system. One person will initially create a document to input comments, then send it to the next person adds to it, and then forwards it on again to the last person. We then discuss our ideas and align our goals for what we want done. So far it has been working pretty well. One of our main concerns is designing the site so that it is tailored to our target audience. We feel this will be a major determining factor for its success. So far, I am pretty confident that we made the right decision regarding our programmers.Also, if anyone has any ideas for their own websites or ecommerce sites etc., let us know and we can get you competitive quote.

Stage 1 of Development: Near End

I am excited to see stage 1 draw to an end. Tomorrow we will receive the first set of documents that our programming team has been working on. Although I am eager to see their progress, I am also quite nervous to see how everything turns out. This will be the first indication if we have chosen the right team for the job. We will also be making our first payment if everything goes as planned. I will also be speaking with Rohit tomorrow about what he has prepared and other new features that we are considering. I'll let you know how everything turns out.Meanwhile, Nick and I have started putting together a marketing and sales brochure to show and leave with potential advertisers. We are hoping to begin our marketing campaign for advertisers as soon as possible. Before we can finish the brochure and begin introducing our product and service we will need to obtain screen shots of the application. This is necessary to show potential clients the overall scope and inner workings of our business. We will likely begin selling as soon as we have something to work with. I have also realized that in order to make our brochure as professional as possible, we will likely need to obtain outside writing help. I feel that our knowledge of preparing such a brochure and our writing capabilities are not sufficient to produce the highest quality brochure possible. Seeking outside help is O.K. in entrepreneurship, in fact, it is very important. It is important to know when you can put your strengths to work and when you need to outsource other skills.We are also in the process of researching what organizations and clubs on campus we will target first and in designing a general marketing plan so that we can create the greatest impact and exposure when we launch. I would like to write a separate post on our approach later, but for now, I want to add that we will be targeting specific people that will most likely be able to help us create that impact. According to Malcolm Gladwell's, The Tipping Point, he explains there are several key players in any situation that cause and help an idea, product, or epidemic to spread quickly. These figures include connectors, mavens, and salespeople. The book is actually very interesting and gives powerful insight into what causes something to be successful or become widespread amongst many people. I think we can and should try to integrate the same concepts into our plan. On another note, I am pretty excited that WE WILL be able to afterall integrate our application into a mobile platform so that it can be used anywhere someone has service. We will also be able to integrate it into Facebook's developer platform. It is important that we come up with as many channels as possible to help us gain exposure. The amount of traffic and number of users will greatly determine our success.

Networking Event at Highland Capital Partners

I spent three hours today dicussing and explaining our startup, sharing and brainstorming new ideas, along with networking with entrepreneurs from across the country at Highland Capital. The majority of the people who attended already own a business, or are in the process of starting/launching a new one. The atmosphere was pretty laid back for a gathering of MBAs and venture capitalist from elite schools like Wharton and Harvard. I only really felt like I belonged because of a shared interest and passion for entrepreneurship. But don't get me wrong, it was fairly intimidating just being in a room with so many motivated and accomplished people. But it is an atmosphere like this that is not only inspiring and motivating, but also educational. It is also comforting to experience so many people that are willing to take similar risks and who not only understand the type of person you are, but also embrace and promote entrepreneurs. In a way, it makes it seem like entrepreneuship is not so risky if you approach it in the right way. I tried to set up a lunch meeting with a venture capitalist that we have spoken to on a few occasions, but he simply wasn't having it. (I could tell by the 15 seconds of silence and the sudden continuation of the conversation without any related response to the question.) I don't think it was the way I approached the situation, we had been talking for about 15 minutes already discussing our business, but the fact that this is a very busy guy that hears tons of great ideas and meets tons of great people as his job. He still seemed interested in our business as he continued to ask questions and talk about our plans. I am assuming that he would like to see some sort of prototype and user traffic success before he will even considers investing any money.After talking with him and another one of his colleagues, I really came to realize that two of the most important things in this industry are to be able to convey an idea and put together a stellar team. One guy that I spoke with heavily emphasized that they primarily look for businesses that have the best possible team running them. I have read about this before, but now I am completely convinced that a team is if not the most important, then deffinitely the second most determinant for a business to succeed and to raise funding from venture capitalists.I feel very fortunate to be able to have spoken with so many talented entrepreneurs. A lot of these guys had great ideas that solved a particular problem or added value to an existing product or service. Some of these businesses revolved around breast milk, bees, and internet platforms. Who would have thought there would be potential to make money by helping bees survive so that farmers can use them more efficiently to pollinate their agriculture. I was blown away by some of these ideas, it just goes to show that there are opportunities all over the place. A couple beneficial things came from networking with these people. 1. I found another business founder that is interesting in integrating our application into his. He said it would work perfect for the online platform he is building, which also shares the same target market as ours. If everything works out, I hope to turn him into an affiliate or work together in some sort of partnership. (I feel you can never have enough of these.) 2. I found other people who are in need of web development. I am particularly excited about this because I can help our web developers gain more business. I have always been a huge believer that if you help other entrepreneurs attain their goals, then they will be more likely to help and cater more towards your needs. 3. I continued to build the relationship with Peter Bell whom I was talking about early. (He was one of the judges at the BCVC competition.) I am glad that I got a chance to spend more time to talk with him and to discuss our ideas. 4. I learned a great deal about how others approach starting their businesses and the necessary steps that they took in doing so. 5. AND I got to eat some great pulled pork sandwiches!On another note, I need to make a correction that Ryan Tremblay is the owner of RT Design Group and Rohit is his partner, who is based out of India. I believe I made a mistake in an earlier post.

Risky Business

Before I begin to dive into the heart of what I really want to discuss in this note I should say that finally we have come to official agreements with our developers and have begun the early stages of design and development of the website. I say finally as if I am relieved that the process of developer evaluation is now over (and I would be lying if I said otherwise...) but I have to say that no matter how strenuous or tedious the process is when money and opportunity are on the line, one can never be too careful. When entering a partnership with another firm sans a proper attorney, you basically have to rack your brain to the point of severe headaches until you feel as though you have sufficiently covered your bases. Granted there are aspects we have forgotten, costs we have ignored and fees we will probably face in the future. These setbacks are unfortunate but it is important to recognize that mistakes will be made in entrepreneurship, no matter how smart you are. Our goal is simply to minimize mistakes, giving ourselves enough time to be thorough but not too much time such that business does not move forward. We have to be ready to deal with mistakes. That is a simple by product of development and there is absolutely no avoiding it. Anyway, the website will be up by approximately in mid August at which point you can expect us to go into shameless self-advertising mode in which we encourage you all to visit it and use it. In the time being we will be keeping you updated on any interesting turns in events (they will definitely happen I can assure you) as well as general pressing topics of entrepreneurship.Alright. I'm a person who is known to take a long time to get to the point so let me get to it. Anybody who is anybody knows that entrepreneurs are risk-takers. Risk-taking has been in the description of the entrepreneur dating back to the 1700's when the word was first invented. Is that a surprise? As an observer, let's say a non-entrepreneur observer, what separates you and that strangely successful business man over there? Ideas? I don't think so. We all have had good ideas at some point or another. We can all relate to those instances when we are thinking or speaking with someone and we say, "You know what someone should invent? A machine that..." or "You know what Company XYZ should do?" or "I want to open up a ____ store..." We have all thought about it. But when you are staring at that "entrepreneur" across the room, as a non-entrepreneur you separate yourself from him by recognizing that he/she was willing to take on risk. Ladies and Gentlemen, that is what I think this boils down to. Risk. And risk is unfortunately frightening. I don't care who you are, what you have done, where you have been and what you have accomplished--risk crawls under our skin and throws us into fight or flight mode. Entrepreneurs fight and that is a choice.The reason why I am discussing the issue of fear and risk, fight or flight is because despite the fact that entrepreneurs have been categorized as risk takers for centuries it is not always that simple. Yes, there will always be those all stars that can crush fear in the palms of their hands. But they are few. Most potential entrepreneurs, most "risk-takers" need support in their risky business. They need someone or some people there to encourage and motivate. If you ever enter in an entrepreneurial endeavor you will most certainly find that some people will respect you for your choice but most will be inclined to point out the pitfalls of your idea, the fear of failure and the stupidity of your risk taking behavior. Even though you consider yourself a passionate entrepreneur the negative words of the non-risk takers--the people that simply cannot understand (to no fault of their own) how you think--will affect you. They are powerful because often times they are irrefutable. Things such as, "Well what happens if you fail? You have missed this opportunity, you will have problem x, problem y and problem z." It's true. One could theoretically argue that entrepreneurship is too risky. We know what they mean, but I must say that theoretically, they are dead wrong. They are wrong because unless they quantify the risk using financial mathematics (which in entrepreneurship you almost can't and even if you could you can't guarantee it would be that accurate) there can never be such a thing as too risky. Investing in junk bonds in the late 1980's was too risky. Walking through the ghetto at 2am drunk and with money hanging out of the pockets is too risky. Pursuing your dream with a certain amount of systematic (inherent to entrepreneurship) risk? Not too risky. One must trust that the entrepreneur has a decent idea that they are willing to implement and the level of risk he/she is willing to take on will depend on preferences. So ultimately it is subjective.The overall lesson? (Sorry about the longwindedness). Entrepreneurship is risky business. There is no getting around that. People who don't understand risk, who could not ever imagine themselves in your shoes will try to stop you. Don't let them. I will say again, do not let them. Find the people (they need not be too many) who support your dream and talk to them constantly. You will need it no matter how tough you are, no matter how much you are willing to fight. I am the type of person who understands risk but has small shades of risk averseness. So many have tried to tell me I am doing the wrong thing. It has been a select few who have helped me through it.Keep the end result on your mind. What will those non-risk takers think of you when you try and succeed? They will admire you and envy you beyond belief. Nobody minds success, not even non-risk takers.And If you fail? They will admire you and envy you just the same because they will never understand your courage.The glory... everybody... is in the attempt.-Miles