Startup Camp and UnConference

I just came back from two days of intense information swapping with a couple of hundred other internet startups and I have to say I felt as if instead of New York I was actually somewhere in Silicon Valley. Labeled the "Start-up Camp: An Un-Conference" by its organizers, the event was unique in that the participants decided what topics to cover in many of the break-out sessions, as opposed to having an agenda forced upon you. Those that had a subject they wanted to discuss (me!) went to the front of the room, announced the title of the issue they wanted to cover and posted it on a large board. Anyone interested in joining the discussion would gather around at a designated area. We spent the whole afternoon going from table to table, and conversation to conversation, to chat with other business owners, and figure out solutions together.

I like this format because, in launching their own businesses, entrepreneurs usually accumulate a ton of information on various topics, so in a sense we become experts ourselves, and that allows for a very useful - and lively - exchange.

My big question was how to use online social networks (blogs, Facebook, LinkedIn or others) to market our businesses. I found out that companies online are coming up with applications, or software, they can customize to attract potential clients. One startup called 8 Coupons is looking to devise a widget that people will place on their Facebook page to let their friends and contacts know what discount coupons they're using in their neighborhood, and in that way drive traffic to their site, which offers the coupons themselves. (For more on how to use Facebook for business see Marci Alboher's recent post, and check out the November issue of Inc. Magazine to see how 5 companies are using widgets as a marketing tool - unfortunately the article isn't available online as of yet.)

Another way to use social networks is to have people leave testimonials about you on LinkedIn, or, you can respond to questions that people pose in the "Answers" section - you'll get top billing as an "expert" if you reply to enough of them. This is one subject that's evolving as we speak and it's definitely peaked my interest, so stayed tuned for updates.

From there we went on to something called "speed-geeking", which is similar to speed-dating but instead of potential partners showcasing their romantic talents, entrepreneurs tried to get 3-4 participants to "fall in love" with their business ideas for 7 minutes, at which point a horn would blow and the crew would move on to the next startup-in-waiting. I was able to see first hand which pitches worked and which didn't, and to realize that I have some work to do with regards to my own pitch...(yikes!).

There were almost two dozen hopefuls vying for the Best Startup prize, with some very innovative ideas. The winner? A company called UpNext.com (that's the creator on the left) who offers 3-D mapping of Manhattan with a social networking component. The 2nd place prize went to BricaBox.com, makers of website building software, and a company called BeenVerified, which verifies that you are who you say you are online, won 3rd place.

As I walked out I stopped by to chat for a few minutes with John Havens from BlogTalkRadio and gave him my quick thoughts on the event (click here if you'd like to listen to the 7-min. podcast).

I got home exhausted but with my head full of ideas. Get ready for Mogulette Camp!

Professor Trexler visits the Mogulettes

Jeff Trexler has a PhD in religion, is a lawyer and he teaches social entrepreneurship. Wow, talk about powerful combinations! He came to visit the Mogulettes this week to talk to us about business structures, but he gave us a whole lot more than that.

He says if you're starting out and have little liability risk (ie. there's little potential for getting sued for the product or service you're offering), it's okay to choose the sole proprietorship structure until you have a better idea of where your business is headed. It's the simplest one of all: You don't have to get registered with the state (although you may need to a license to work in your particular field) and you get taxed at the personal rate. One drawback is that you're liable for everything - in the event that you get sued, they could go after your personal assets - yikes!

It's even worse with partnerships, which is when two or more people come together to form an enterprise. With this type of structure the partner with the most money will stand to lose the most in a lawsuit. They'll go after the richer one!

With a corporation, you and your company are two separate entities. There is a legal distinction between the two, and if you get sued, only corporate assets can be seized. The problem here is the double taxation. Profits get taxed at the corporate level and then dividends get taxed as well. And you also have to maintain certain formalities, like you must hold regular shareholder meetings (even if you're the only person in the corporation!) and keep separate books.

According to Jeff, for many businesses the best choice is to become LLCs, or limited liability companies. LLCs offer limited liability to the owner and they get to report the income or loss on their tax return.

Before you make a decision, he suggests speaking with an accountant and/or lawyer to see if there's tax benefits for you associated with a particular structure. Each case is different so you must consider your own unique factors. One great resource he gave us was NOLO Press. They publish all sorts of guides written by lawyers in layman's terms to help you navigate through complicated legals issues. He says the books are so helpful that the State of Texas was at one point considering barring their sale because they took too much business away from lawyers! Jeff gave us a free copy of one of their books, "LLC or Corporation? How to Choose the Right Form for Your Business".

Which brings me to why this dashing professor holds a position of honor at our club - he also donated eight brand new books on business, so that now we have our very own lending library! Aside from the one above, we also have the following texts, all written by Rhonda Abrams, available to borrow:

Winning Presentation in a Day
Business Plan in a Day
Six-Week Startup
Finding an Angel Investor
The Owner's Manual for Small Business
Trade Show in a Day
The Successful Business Plan, Secrets & Strategies
Successful Business Research

And not only that, Jeff believes that everyone should have access to information. He says that if you want to be accredited then by all means you can attend school, but if all you want is to be better informed, then that shouldn't cost you any money. So he's planning on putting all the lessons on entrepreneurship and law he teaches at Pace University online, to make them available to all. What a guy!

Here's two more links he gave us that could save you time and money: The NY Dept. of State has a database where you can check whether the name you want for your company has been already filed by someone else. Then go over to the US Trademark Office to do a national search using their search engine.

Jeff promised to come back to talk about innovation and finding a niche, so I'll keep you posted!

Postcards from the Edge

Hello everyone! Your chief Mogulette here reporting from the trenches. We're in the midst of marketing mania. Last week me and three other Mogulettes trekked over to Flatbush, Brooklyn for a seminar on cheap ways to market your business sponsored by CAMBA, a local agency that helps startups. It took us an hour and 20 minutes to get there but it was worth it. Jay Savulich, who led the workshop, had us in stitches most of the time. He's launched and run a number of restaurants in Manhattan like Tortilla Flats and Grange Hall, so he shared many funny and instructive stories on how to "win friends and influence people".

Brenda and Viv at the marketing seminar

One of our fellow Mogulettes, Brenda (above left), asked a question that brought up an interesting discussion. She is launching a dog care service and wanted to know if it was a good idea to put the name of your company on those little plastic bags used to scoop up your dog's poop. My initial thought was "Hell, no! That's gross!" But Jay pointed out that if you put your logo on the bags and give them away for free, it's a way to build customer loyalty and advertise your brand. Of course!!

This week we piggy-backed on the marketing theme and did a brainstorming session to figure out ways to promote ourselves. We had two ladies in the group providing pet care services so one suggestion we came up with was to print out postcards and use a similar strategy to Olimpia's (see her story here): strike up relationships with pet store owners where you send each other customers and leave a stack of cards at their store. Another one is give your existing clients a special gift (a discount or some other freebie) if they refer their friends to you.

As for my own business, I got a great idea from Ina, an incredibly creative make-up artist and stylist who's also part of our group. I was searching for a logo for the Mogulettes and this image in my head of a strong, invincible woman that does it all. There's a caricature in an E-surance commercial that comes close to what I had in mind - but Ina came up with an even better one: take the Charlie's Angels image of three women and instead of them holding weapons they hold a cellphone, a laptop and a briefcase! Love it! Soon to be at a Mogulette blog near you! Over and out...

Anatomy of a Startup: Allongé Dance Center

We recently had two full-fledged entrepreneurs (as opposed to aspiring, as most of us are still…) come visit our ever expanding Mogulettes meeting (we now have 36 members!) to share how they got started. Olimpia Hernández and Luis Blanco launched the Allongé Dance Center almost two years ago. Here are a few highlights of their story.

Trained as a dancer since she was a child, Olimpia had been dreaming of opening a dance studio for a long time. She had actually tried to do it on her own in the past but it hadn’t worked out. Then she met Luis, who has a background in finances, and decided to ask him to be her partner. From a business perspective, they complemented each other quite well. Luis could focus on doing the numbers-crunching and researching their target market, while Olimpia's expertise as a dancer and instructor would help them formulate the curriculum for the school, and give them a competitive advantage.

Luis and Olimpia share their startup secrets














Once Luis agreed to come on board, they decided to set a start date - that way they had a deadline to work towards. They gave themselves 9 months to prepare and immediately started looking at possible locations for the school. Their target market was parents with enough disposable income to pay for their children to attend dance classes, so they went into the census website and searched for neighborhoods with annual household incomes of $80,000. After that, they checked to see if there were any cultural or religious components to the area that might make a dance school unpopular with its residents. Competition was also a consideration, so they looked for places that didn’t have a lot of other studios operating there. Forest Hills, Queens, was their eventual choice. They even found a space that had just been vacated and had previously housed a dance studio.

With a little help from your friends
Luis quickly sat down and made some projections of how much they would need to "set up shop". He calculated it would cost $20,000 to renovate and rent the space for the first three months of operations. That was a huge chunk of change, especially since they didn't have it! They would also be losing money when the space wasn't being used, which would probably be most of the time at the beginning. But what else could they do?

Olimpia was able to find help in an unlikely place: she asked none other than her old boss for advice, who came up with a much cheaper alternative. He owned a dance school in Westchester where she had been teaching classes, and since she planned to open a studio in another county, she knew he wouldn't feel threatened. He suggested they do what he did when he started out: find a space they could rent by the hour, and only pay for the amount of time they needed it. Brilliant! (Another reason why we need mentors: to avoid costly mistakes!)

Howdy partner!
So they switched gears and looked into health clubs, karate schools and other options, until they found a yoga studio nearby that fit their requirements: a hardwood floor and a few open slots of time in the afternoons. However, when they got down to negotiating the rent, the owners wanted too much. So Olimpia and Luis came up with the idea of partnering up with the "yogis". They offered to give them a percentage of their profits in exchange for paying less rent, and the deal was sealed. Another hurdle overcome!

Coming up next: How Allongé found low cost ways to advertise