The Staufenberger Repository

Starting a business

Staufenberger Smith & Butte LLP is 1 year old. Well, it was a few weeks back but we didn't notice.

They say that if you can get throught the first two years you'll be OK. So by that measure, we're halfway there.

Not sure if it's any use, but we thought we'd share our top tips for starting a business, or getting through the first year. No doubt this list will have changed another 12 months from now.

1. It's not about us - no creds on a first date

Since we launched we've only presented credentials once and that was one too many. We quickly realised that it's not about us and what we've each done in the last 10 years. It's about the people we're talking to, their brands and how we can help. Our past work on brands such as PlayStation, BMW, Ocado, 118118 and others is what got us in the room in the first place, that first meeting is about future possibilities not past glories.

The relief is practically visible on their faces when we announce there's no powerpoint to sit through.

2. Don't be afraid to say no.

This one tends to polarise. Do you drop your pants, er costs, to get clients to try your services? Or stick to your guns, say no and risk losing the job?

In principle, we would always go the latter route. But, of course, the realities of setting up a business (without heavyweight backing or a big chunk of savings) sometimes mean that principles like this get ignored.

Thankfully, we haven't had many instances in which we've needed to do so. And we don't like to, because, you know, we're worth it. It costs what it costs. And sometimes that means that you have to say no.

3. Don't be afraid to give it away for free.

This is something we picked up from one of our heroes, self-proclaimed small business marketing guru, Chris Cardell. He's kind of evangelical about it, as a guru type is likely to be, but beneath the motivational hyperbole lies an obvious point: one of the best ways of convincing clients that you're worth it is to give free advice.

And so we see this as the corollary of the previous point (not reducing your rates) rather than a contradiction of it. At first, for an outfit that exists to give advice, it feels like commercial suicide. But in reality it's the consulting equivalent of the crack dealer giving away rocks to get kids hooked. And it seems to work.

4. Don't be afraid.

This is a bit of advice that we were given early on and it's served us well.

You need a bit of recklessness to set up a business in the first place. But the challenges don't stop once you get past the initial jump. Unless you're someone with the profile of Trevor Beattie, say, it's highly likely that you'll face some tough patches after you've got yourself up and running. And the advice we were given, when we were faced with these tough patches, was hold your nerve.

It might sound trite or a bit obvious, but you've just got to hang in there. It will get better. And if it doesn't, then you really are fucked. How can you tell when you should hang on and when you should cut and run? We haven't worked that out yet.

5. Never stop feeding the furnace (or somesuch metaphor).

The reason we had a tough patch was that we got busy earlier in the year and stopped chasing new business leads. Schoolboy error. The projects that had been keeping us busy came to an end in mid summer and we had nothing lined up for the usual late summer/early autumn seasonal lull. And it hurt. We won't be making the same mistake next year.

6. Talk to everyone

And by that we mean everyone. It doesn't matter if they're not obviously in a position to give you work. But you just never know who they might know or what they might hear about. And often you don't realise how they might help until they do.

7. Be nice to people

People like working with people they like and get on with. It's not rocket science. If you're self-important and arrogant, chances are you won't be asked back. So be nice.

So there you have it. There might be a few other points (like, don't forget your VAT returns, that sort of thing) but these have been the recurring themes Chez Staufenberger over the last year.

Anyone else have any others? We love to hear them.

Fashion with a small f

The reason we picked up A Matter of Taste is that we've noticed that more and more markets or sectors are developing a fashion dimension.

And by fashion we don't mean that they've become popular with the style press or DJs or whatever. Rather, that certain markets have become influenced by "matters of taste" where once they weren't. And that those taste preferences are seldom driven by functional improvements in a product or service.

A few examples:

The modern mobile 'phone began as a business tool and the early years of the consumer market was led by developments in this arena. But as the technology gained wider acceptance, the market's reliance on the functional capabilities of 'phones diminished to the point where the V3 - a handset that some might say performs less than perfectly - has become the runaway success of the last couple of years.

Similarly, this article from 2003 complains that even gardening has developed a fashion element.

And then, of course, there's bikes; a subject close to Team Staufenberger's collective heart.

Until relatively recently, if you were a keen cyclist you bought a certain type of bike and everyone else got something from Halfords. Simple. Now there are cool bikes and there are a load of other bikes, and the distinction has little to do with how keen a cyclist you are in the old, saddle-like-a-razor sense. There's now an extra dimension to the bike market. A cool dimension. And as we all know, what's cool - like any fashion - changes over time. So bike brands now have to contend with an extra layer of complexity in their market.

This new dimension is typified by - though not limited to - the rise in popularity of the fixie: a road-going bike with one fixed gear. When the wheels move, the pedals move. And vice versa. (For those less familiar with the fixie phenomenon, here's an annotated version of the above picture on flickr. And here's an article by Matt Seaton, author of The Escape Artist).

The roots of the fixie trend are relatively easy to identify and have a lot to do with the influence of bike couriers. The interesting thing to note, though, is that the trend is evident in a number of countries around the world and has clearly been fuelled by the daddy of fixie websites, the Fixed Gear Gallery.

Already, the market has responded, both to the popularity of fixed-gear bikes and to many cyclists' desire for clothing that is a little more stylish. It will be interesting to see which other brands respond to the challenge, how they do so and whether their responses cut it. After all, fashion can be hard to manage: just look at G-Shocks and Hush Puppies.

As for the fixed gear bike, it must be fast approaching it's tipping point now that none other than Will Self has proclaimed his desire for a fixie is the "very epitome of [his] mid-life crisis".

On yer bike. Please.

At Staufenberger Towers we've been talking to some public health types about helping them get more people to cycle in London. Our trip to Munich provided an interesting perspective. It seems that everyone in the city has a bike.

There are thousands of them.

But despite the high numbers (compared to London), Munich bikes - almost without exception - are utilitarian, sensible, commuter rigs like those from Kettler. No flashy, Italian road machines, very few American off-road irons. And certainly no fixies.

Which made us wonder why Germany - a country with little heritage in cycling as a sport, despite obvious successes - is so enamoured with the bike as a means of transport. And conversely, why the Italians - synonymous with cycle racing - are so sniffy about using a bike to get from A to B (at least, if these Italians  are to be believed.)

Is it the weather? The hotter the climate, the less people will exert themselves to get around? Possibly.

Is it the provision of a good cycle lane network (see above)? Perhaps. But depsite being better than those in Blighty, the Munich cycle lanes aren't that amazing.

Back in London, our friends in public health believe it's about removing barriers, perceived or otherwise: no showers at work, too much (motor) traffic and so on. We suspect it's more about encouraging or stimulating demand in the first place. If people want to ride to work, they'll find their own ways round the barriers.

In this sense, we may be in luck, as the wind is defintiely behind us: cycling is - whisper it - becoming fashionable.

Loving Complexity

Haven’t really sorted this all out in my head but here are first thoughts. It’s an attempt to apply a theory that begun in the world of engineering but went on to inform management theory (check out the work of Peter Checkland). It’s a reaction against reductionist and mechanistic thinking...

In the world of communication strategy we often set out to reduce complex problems into separate manageable components, even to the point of refining the problem to one key issue. But the reality is that we are looking at an environment of increasing complexity brought about by the fragmentation of media and the impact of communication technologies where everything is connected to everything else. This means that all problems are connected. The affect of all of this is to make it difficult to predict the outcome of any marketing communication intervention.

Enter systems thinking, a different way of looking at the world. It’s about ‘holism’, studying the whole before looking at the parts. It focuses attention instead at an organizational level and on ensuring that the parts are related properly together so that they serve the purposes of the whole. It is often in the interaction of these parts that complexity lies and not within the parts themselves.

So how do we apply a systems thinking methodology to marketing communication? There are three things we need to understand:

1. Structure - defining the boundary of the system (or brand) and the components to integrate (communication channels, stake holders and their relationships and so on).

2. Function - defining the business objectives of the brand and its outputs.

3. Process - defining the specific sequence of activities and know-how required to produce the outcomes.

Find a new business on eBay

This is a theory - not particularly original, I suspect, but a theory nonetheless -  about using ebay as a source of new business concepts.

The idea is that if you're itching to start your own venture but struggling to find an idea to put your energy behind, you could do worse than visit ebay. Not to set up an outfit buying and selling, say, plastic bags from around the world (although you could if someone else hadn’t beaten you to it). Rather, as a visible and trackable aggregation of thousands of people’s wants, ebay can provide a very useful tool in identifying potential business opportunities.

Here are five ways to do so:

1. Check what’s happenning on the US site

Like it or not, what’s hot in the US today will be hot over here in a short while. And if you look closely, you can spot the beginnings of new trends in consumer demand.

2. Retro cool

This is a really rich area and it’s very simple. In many product sectors there is a healthy second hand market in old stuff. This trade is distinct from a purist collector’s market, although of course these also exist on ebay. Rather, this trade is in merchandise that is obsolete only in that it’s not produced any longer. It’s out of fashion but perfectly serviceable and is bought with the intention of being used not put in a display cabinet. Much of it is driven by a hardcore of enthusiasts whose tastes, for whatever reason, are out of kilter with the mainstream (and hence major manufacturers’ output).

This niche audience is often enough on which to base a healthy “skinny multinational”, as Ridderstrale and Nordstrom call them. However, with skill and a following wind you can also spot the longer term trends that will eventually spread to a more mainstream market. Records and trainers are good examples of each. Obscure old jazz and funk records and rare dead-stock sports shoes can command huge prices on ebay. Hence, Jazzman Records for example, who do small but profitable levels of business in many countries around the world, typify the definition of a skinny multinational.

At the opposite extreme, the major sports shoe manufacturers realised long ago that there is a vibrant second hand market for their old styles of trainers. Today, all of the major producers “reissue” the most popular of theses old styles. Adidas has even re-organised the company to market these older styles under the Adidas Originals sub-brand. Today, a large chunk of Adidas' business is from a sector that 10 years ago was a niche market – conducted mostly online, at places like Crooked Tongues - composed of die hard trainer fans buying and selling their favourite vintage styles.

3. What's important to you?

Personal passions or missions can often provide the basis for a successful business. Think Anita Roddick and the Body Shop. Or Ivan Massow. Nike was founded by Phil Knight, a keen college middle-distance runner.

Whatever it might be, what's available on ebay? What's selling and what's not? Are there any unexpected quirks to the trade on ebay that might give a hint of a new opportunity?

4. Ebay Marketplace Intelligence.

Once you’ve got a few ideas you might want to delve a little deeper into the robustness of the market you’re considering entering. And for just such purposes - well, sort of – the brains at ebay have launched ebay Marketplace Intelligence. This is a new service that ebay offers whereby for a fee - what else? – you can research a category of your choice: average prices, average number of bids, average opening bid plus all manner of other feedback on buyer behaviour. And for a bigger fee you get to research more stuff. And they’ll even chart the data for you.

5. Weird shit/what if?

If you’re still searching for inspiration you could always try the “weird shit” route. This is where things get more murky. Basically, if you wander around for long enough in ebay, you begin spotting odd things that just might provide the basis for something completely new. This approach is more about finding leftfield ideas than gauging consumer demand. But, of course, even those strange ideas have their foundations in actual and verifiable purchasing behaviour so perhaps they’re not so odd after all. For example, there’s a strong market for gift vouchers, especially the electronic variety from the likes of iTunes and Amazon. Rather oddly, some of these sell for close to the face value of the voucher. I don't know if there's a business in it, but there are people buying these things. But that's what this route is all about.