Class: 2014 Winter Accelerator
Faux Pas is a hybrid "Indie Fashion" marketplace and netflix for fashionistas. Instead of getting DVD's in the mail, our customer gets trendy, one-of-a-kind fashion pieces that she can wear, enjoy, return, and then exchange for the next item on her que. Faux Pas offers shopaholics everywhere the ability to shop continuously, have endless variety in their wardrobe, relieve the environment, yet still keep more money in her pocket. Unlimited outfits, unlimited exchanges: one flat monthly rate.
Juggling Three Bottom Lines: The Balance Between Social and Financial Sustainability. 2/6
Corporate Social Responsibility. A phrase that 10 years ago, if uttered in a board meeting would been as “faux-pas” as shouting out Voldemort through the halls of Hogwarts. Or at the very least would have elicited a snarky wise-crack or two…followed by a period hushed cynical chuckling.
While most industries are far from embracing the concept, the tide of change has certainly begun to turn as socially conscious consumers, tired of corporate greed, are beginning to dominate the market.
For ages, traditional free-market economists like Milton Freedman have argued that a corporation’s sole responsibility is to it’s bottom line…to shareholders. But in the wake of a post-recessionary economy, new schools of thought have emerged to expand those responsibilities. Companies aim to maximize value for not just shareholders…but to all the stakeholders effected by a business’s commerce; customers, employers, suppliers and even communities. Bottom lines are no longer singular and instead include people and planet as well as profit.
Yet despite pioneers like John Mackey (CEO of whole foods and inventor of stakeholder theory) and John Elkinton (founder of SustainAbility and the concept of Triple Bottom Line), we’ve yet to put a methodology behind the juggling act of managing the competing forces of 5 stakeholders…or 3 bottom lines. How should companies prioritize? Make difficult decisions? And to draw the line…when there are already 3 of them?
Brenna Schneider, founder of 99DegreesCustom and resident expert on “business with a mission”, is a perfect example of the challenging but vital prioritization process a socially empowered entrepreneur faces every day. Start ups, in their particularly vulnerable state, must be especially cautious to when it comes to making decisions with social intent.
What happens in a situation where bottom lines are at odds? A productivity issue with an employee, a green solution that harms your margins…a funding opportunity from an investor that may compromise your ideals?
The balancing act begins.
It’s no surprise that any factor detracting from the profitability of a fledgling business for the sake of another bottom line is a red flag. If the business isn’t financially sustainable… it won’t be around to accomplish the impact it dreams of. An employee that drains resources but doesn’t add value simply can't continue with the company… regardless of intention.
On the flip side…any decision that’s maximizes profitability at the expense of any of the major stakeholders begs to ask the question… “ is this a business worth creating”? A funding option that has the potential to scale the business yet misses it’s mission... may be …for that entrepreneur…of questionable pursuit.
According to Brenna, “values will become the touchstone that you use to make business decisions. They will guide your conversations with customers, investors, etc. It’s important to figure out your values early on, so they can guide how you grow as a business. You have a blank slate. You can be the kind of entrepreneur that you want to be. Build your values into every decision you make so that every step of the way, you build a culture around them.”
Building the social mission of the business into the core financial model is only the beginning. Managing one bottom line is a feat in itself. Managing three is not for the faint of heart. But the truly inspired entrepreneur adapts their model to leverage what they’re passionate about changing. Defining your values and beliefs allows an entrepreneur to surround themselves…and their business opportunity… with employees, customers, investors, and others who believe in their cause. The goal is not just to sell to people who need what you have; the goal is to sell to people who believe what you believe. The goal is not just to hire people who need a job, but its to hire people who believe what you believe. The goal is not just to seek a funding partner that wants a financial return on their investment…but one that believes in seeing the return on our communities, our society, our economy, and the market.
MVS’s How Great Leaders Inspire Action: Simon Sinek's Wisdom Meets Todd Fry’s Fabulous Stage Magic
Your pitch begins the moment you're in the room
Monrose motivated sequence: problem, solution, action! Parallels Why-What-How.
establish that problem exits and create a sense of agreement in the room
invite people to participate in a story
Don’t invite them to second guess your analysis; analytic part of people's minds are looking for reasons to be smarter than you
The purpose of the hands is to paint a picture for us in mid-air
change creates meaning and reinterests people
walking helps people visualize your train of thought
movements and ideas should be in sync
rhythm of the body and the rhythm of the mind should always be in sync!
you have a gift to give your audience! Enjoy it!
Entrepreneurs Tell All
Some choice wisdom from these rockstar entrepreneurs:
Josh Resnikoff: Co-Founder of Cuppow
Brendan Shea: Co-Founder of Recover Green Roofs
“Conduct yourself like a Fortune 500 Company. People will respond to whatever you tell them you are.”
"A startup company owner wears a lot of hats…but don’t try to wear all of the hats…they won’t all look good on you."
My take on why these guys are suceeding? People buy products that imbue them with a sense of self-worth. Josh and Brendan are just further proof that people don't buy what you do they buy why you do it.
Search Engine Optimization and Search Engine Marketing are not for the faint of heart. The rules are always changing and even the experts have trouble pinpointing the mysterious algorithms behind google’s strategy.
But what we can decipher from the technical jargon are perhaps a few techniques to increase site visibility and enable easy discovery on search engines.
- Engagement and changing content is key: updated and dynamic content that is refreshed regularly drives people to a site and can increase rankings.
- Inbound Links: the higher the quality of sites that link to your site…the more it will affect you’re sites ranking
- Leverage Text Description: more accurate the links and meta descriptions enables those that text to show up in relevant search.
All in all…although most of the nuances of SEO/SEM marketing are a tad beyond the expertise of a non-technical entrepreneur…a more concrete understanding of the strategy can only enable a founder to make better decisions surrounding web based marketing and analytics.
Cold Calls, Customers, and Sales.
Regardless of whether the nature of a start-up’s business model requires picking up the phone to acquire customers…cold calling is a skill an entrepreneur simply can’t do without. Whether its customers, suppliers, institutions, or investors … a start up that is adept at quickly captivating strangers, retaining their attention, and convincing them that the purpose is worth their time…will be well positioned against the hurdles of building a business either big or small…for profit or not for profit.
- Be comfortable with rejection. In some cases…it’s a numbers game…sometimes persistence can win. But the answer to a question you don’t ask will always be “no”. A “no” from a party of interest isn’t the end of the game. More often than not “no” doesn’t mean “no”…it just means “not yet” , “not now” or “not quite”. Many no’s will come before “yes’s” and they are the essence of cold calling. Drive On.
- Short and Sweet: Create a hook that will reveal just enough to create interest and incite someone to inquire. Details overwhelm and tend to drive attention spans elsewhere
- Focus on benefits: Instead of rattling off information about what it is that the business does…focus on how you can further the agenda of the person you’re speaking to. Why should feel like it’s worth their time?
- Make a personal connection: Building a relationship with a potential customer as quickly as possible is vital.
- Ask open ended questions: if they’re talking…you’re winning.
- Confidence is Key: People respond to confidence and passion. Smiling over the phone is tangible.
- Keep the close in mind: The goal is not a sale or an answer but a follow up. Can be in email form, meeting time, etc.
When it comes to acquiring new customers, “long-term greedy” is the name if the game. From promotions to freebies…to discounts…to promotions…many young business are afraid of taking a short term loss for a long term gain. If PayPal can go from paying customers themselves to sign up for an account to the force they are today…there’s hope for those of us starting in the sandbox. So let’s get a shovel and start digging!