Blog: 2012 summer speakers

Jul
25
2012
By Sohara Mehroze Shachi

 “Set your ego aside—you need money,” said quick-service grilled cheese chain Cheeseboy founder, Michael Inwald.  A 2009 YEI Fellow and serial entrepreneur, Inwald’s experiences with multiple ventures in resource-constrained environments highlighted the importance of finding sources of funding early on in the venture process.

Competing in Crowded Markets

Before arriving at Yale’s School of Management, Inwald started a number of new ventures including Youngfilmmaker.org, Inwald Media Inc./BusinessWorldReview.com, a multi-media production company, and Nightliferatings.com, a nightlife/entertainment search engine and user-based rating system for bars, clubs, and lounges. In each venture, the lack of funds became a major obstacle for scaling the company, and he quickly realized that entering a crowded market without funding made it extremely difficult to differentiate the venture from the competition.

Enrolling at Yale SOM, Inwald’s entrepreneurial spirit was still alive. He’d always loved cooking and enjoying cheese-related dishes – his specialty being the grilled cheese sandwich – and he realized there weren’t any quick-service grilled cheese chains out there.  From this came the concept for Cheeseboy, a quick-service grilled cheese franchise, which was selected for the 2009 YEI Summer Fellowship.  His priority that summer was to find and secure enough capital to give his fledgling company a fighting chance in the tough restaurant business.

Jim Boyle & Michael Inwald

 

As part of his search for capital for the company, he self-funded booths at county fairs around Connecticut and videotaped consumer reactions to his grilled cheese.  Armed with copious video evidence of enthusiasm for the sandwiches and market research he conducted that showed demand for grilled cheese and willingness to pay, he was able to find an investor that partnered with him to bring the first Cheeseboy pilot test location to Milford’s Connecticut Post Mall. 

Today, Cheeseboy has eight locations throughout the Northeast, including in Boston’s South Station and Prudential Center.  His success in the competitive quick-service restaurant business has enabled him to be thoughtful about Cheeseboy’s growth going forward—the company aims not to be the largest necessarily, but rather one of the most respectable national chains, a choice that Cheeseboy’s prosperity and financial backing has allowed the company to make.

The Takeaway

Be realistic about the resources your venture needs to take on a crowded space, and focus on securing them early on in the process.  Having them under your belt will allow you to make measured, strategic decisions about your company’s future, rather than scrambling to stay afloat.

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Jul
24
2012
By Sohara Mehroze Shachi

 

  Chris DeVore, co-founder and General Partner at Founders’ Co-op, a Seattle-based seed-stage investment fund, has years of experience working with entrepreneurs.  He’s one himself – as a co-founder of e-commerce services firm Adjacency (acquired by Sapient) and local social search platform Judy’s Book -- and today is an investor and advisor in more than a dozen venture-backed startups including Appature, Appfog, GroupTalent, Remitly, Simply Measured, Urban Airship and Zipline Games.  Needless to say, he has been around the block a few times and has some ideas about what NOT to do.

Don’ts for Entrepreneurs

One of the pitfalls for entrepreneurs is their stubbornness. “Smart people are so convinced that they are right that they don’t always take signals from the world,” he said. While this belief in one’s own “rightness” can be part of the reason young people decide to pursue entrepreneurship, DeVore emphasized the importance of reaching out for feedback and advice from outsiders. “When you are young you have a tendency to focus just on yourself, but for people like your mentors who don’t have anything else to prove, it is rewarding to help young people like you.” DeVore said a lot of entrepreneurs fail not for lack of business planning but for not creating and sustaining human relations, and mentors can help with that.

However, he warned the entrepreneurs against “cosmetic advisor collection”–merely getting a laundry list of mentor names without being strategic about engaging them.  It is important for entrepreneurs to identify a handful of mentors that they connect with and make sure that they have shared interests that overlap with the venture.  Taking them out for a drink and “treating it like dating” is one way to go about it. The key is to concentrate, invest and over-communicate.

Another common hazard in this arena is that many entrepreneurs are very proud and protective of their venture, and often want to be sole proprietors. However, DeVore emphasized that it’s usually better to have cofounders since there is a lot to cover. While the process of finding the ideal cofounder can seem daunting, he said going to “Startup Weekend”-type events is a great way to meet like-minded individuals and potential cofounders.

“You gotta show up where other people with your ideas are,” he said. “You have to put signal out to the world for them to bounce back.” The ideal cofounder might or might not be in the room but if the entrepreneur is not broadcasting the message will not get across.

The Takeaway

To be successful, entrepreneurs must recognize their own limits and find ways—and people—that can help them circumvent them. 

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Jul
24
2012
By Sohara Mehroze Shachi


At its core, a business plan should describe a compelling idea and the plan of execution, according to Yale School of Management and School of Forestry and Environmental Studies lecturer Maureen Burke.  At Yale, she teaches an Entrepreneurial Business Plan class and project-based clinic in which students do financial analysis of environmental decisions faced by for-profit and nonprofit organizations.  She has also been a longtime advisor to the Yale Entrepreneurship Society’s Y50K business plan competition, and has seen many student founders and their business plans over the years.

In her experience, it is the “plan of execution” aspect that stumps most entrepreneurs.

As much as it is a tool to raise capital, from investors or banks, the business plan is also an opportunity for the founders to explore every aspect of their proposed venture, sanity-check it, and formulate it into a plan of attack.  A solid business plan helps the venture to secure necessary funds and recruit top people and at the same time it helps the current management focus on ideas and set priorities.  Down the road, it can be invaluable in checking progress as a benchmark.

This dual purpose makes it important to avoid the common error of writing a plan that is too academic and long-winded. Burke said an appealing business plan is clear, simple, easy, and basic – the exact opposite of academic writing. Demonstrative pictures and graphs should be used to prevent people’s attention from waning, while jargon and acronyms should be removed.  Burke also advised avoiding the passive voice in the plan. “Active voice exudes confidence and implies that you are actually going to do things,” she said.

The Takeaway

A structured, comprehensive and yet objective business plan can help an early-stage venture stand out among investors while simultaneously giving the company structure and targets as it grows.

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Jul
11
2012
By Sohara Mehroze Shachi

Networking is an art, and local advertising company PaperG cofounder and CEO Victor Wong had a lot of advice about mastering it.

“A lot of entrepreneurial success comes down to how you meet people and how you cultivate relationships,” said Wong, adding that there is not much literature about how to productively do so. The key is to foster interpersonal and mutually beneficial trade without asking or expecting too much from people.

There are two ways to make connections, according to Wong—through serendipity  and deliberately.  Serendipitous meetings can happen anywhere—in a bar, airplane, restaurant—and it is crucial to always have an “elevator pitch” ready for such chance encounters. When it comes to making deliberate attempts to promote relationships, there are a lot of tools out there today for identifying people, and the advent of social media has made the process even easier. Moreover, Won said throwing “really good parties” is a very good differentiating tool and a surprisingly effective way to meet people.

Many people starting off without really knowing what they have to offer, and a successful entrepreneur not only believes in her/himself but also knows how to motivate those around and make them feel important. Most people, no matter how experienced or important they may seem, are extremely receptive to young enthusiasts who want to change the world. Wong stressed the importance of having a genuine interest in changing something and truly believing in it. “Ask yourself – do I really believe in what I am doing? If I don’t why should anyone else care?”

The Takeaway:

The art of networking, while it can seem daunting, can be and needs to be mastered by entrepreneurs.  When practiced correctly, it can lead to the creation of new meaningful relationships, which can benefit both parties.

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Jun
19
2012
By Sohara Mehroze Shachi

Personal sacrifices are often glamorized in the world of entrepreneurs, but at the end of the day it is a price you have to pay. Founder and CEO of ConsumerBell, Ellie Cachette, spoke to the YEI fellows this week about the importance of valuing our time by putting a price on it.  (See her full talk here.)

Cachette talked about the numerous personal sacrifices that an entrepreneur has to make on a daily basis. Drawing examples from her life she told the fellows to stop having expectations of leading a “normal” life once they enter this field. The level of commitment required to make an entrepreneurial venture succeed could put a strain on personal relationships, health, sleep and finances so one has to question whether he or she is truly ready for such a lifestyle.

Once that decision has been made, Cachette advised the fellows to focus on getting the right infrastructure in place—connecting with legal counsel and getting the company incorporated.  She suggested setting up an invoicing system by opening an account with Quickbooks or Freshbooks to better manage finances, as well as getting comfortable with firing people, since the company’s wellbeing has to be put before anyone’s personal interest. “And stop reading TechCrunch, funding isn’t easy,” she said, telling the fellows that they need to do what it takes to maximize their chances of getting funded. “The right thing happens to those that quickly adapt and keep moving forward. Sink or swim my friends.”

Besides conducting the directly business related activities, entrepreneurs need to think about the people they spend time with since that has a huge role to play in shaping their future. Contrary to expectations, Cachette said, it is important to hang out with people who do not believe in you, because they are likely to point out flaws where your friends and family will not, and so you can learn what your weaknesses are and work on rectifying them.

The takeaway:

Choosing the entrepreneurial path means putting a lot at stake. While it can be incredibly rewarding, there is also a very high price to pay, so it is necessary to put a price on oneself but never go on sale.

Photo:  http://www.stephaniehaller.com.

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