Small Business Labs

Social Media Not For Everyone - At Least Not Yet

The Small Business Trends blog has two "point-counter point" posts on social media.  One is called Why Social Media Should Be a Key Ingredient in Your Marketing Mix and the counter-point is 10 Reasons I Won't Use Social Networking.

Obviously I'm biased towards social media.  I'm an active blogger and I serve as a Senior Fellow and board member at the Society for New Communications Research - a non-profit think tank focused on researching and promoting social media.  And in my work I've seen a broad range of companies and people substantially benefit through the use of social media.

But using social media as a marketing tool is not for everyone - at least not yet.  The reason is simple.  Despite the hype, active online social media usage is not close to ubiquitous.  Many businesses serve markets where their customers and prospects do not use or even know about social media.  So matter how good your social media marketing is, it won't matter if:

1.  Your target market is not online.  Not everyone is online.  According to Pew Internet, about 25% of American adults are not online.  Generally speaking older, lower income and rural households are less likely than average to be online.

2.  Your target market is not aware of and/or doesn't use social media.  Despite all the hype, most online users don't actively use social media.  Less than 60% of online teens have Facebook and or MySpace accounts.  The numbers for adults are obviously much lower.  And while Twitter usage is growing very rapidly, it is still a niche service and less than 1% of online Americans actively use it today.  Pew's research also shows that roughly half of online Americans use online connective technologies sparingly and many "bristle at electronic connectivity."  These folks may be online, but they are not big social media users.

3.  Social media plays no role in the purchase decision process for your products or services.  Even if your customers are online and using social media, they may not be using it in a way that matters to your business.  I was recently involved in a study measuring the effectiveness of a B2B social media marketing campaign.  The target market was online and relatively sophisticated in their use of social media.  But for a variety of reasons, their social media usage had almost no impact on their purchasing decisions for this product category.  Because of this the campaign was ineffective. 

For many small and personal businesses using social media makes enormous sense.  And over the next 3-5 years the growth of social media usage will make it an increasingly important part of the marketing mix for many more businesses.  But like all marketing methods, make sure social media marketing fits with your target market before making a major committment.      

Generation X and Small Business

Tammy Erickson's blog Across the Ages has a post on generation X being unhappy with corporate life.  The post lists 10 reasons why Gen X is unhappy.  Not surprisingly, Gen Xers are telling Erickson that they plan to move to entrepreneurial ventures or small companies.  Quote from the post:

"Many of you have told me that you are planning to leave corporate life “soon” – to start entrepreneurial ventures or work for smaller companies – options you feel will suite you better than the corporate roles looming ahead."

Not good news for large corporations.  Already facing a baby boomer brain drain and Gen Y corporate skepticism, losing Gen Xers just as they reach prime management years would be a major talent problem. 

Middle Class Millionaires and Business Coaches

I recently posted on the book The Middle-Class Millionaire.  One piece of information from the book that really surprised me was the extent middle-class millionaires (defined as having a household networth between $1 and $10 million dollars) use business and personal lifestyle coaches. 

Their survey showed that "about half of middle-class millionaires have hired a business or life coach in the past three years, and another 20 percent or so say they intend to hire one in the next few years."  The primary purpose they cite for hiring a coach is "help with career skills (90 percent)." 

We've been following the trends around the growth of personal services, but I wasn't aware of how common business coaching had become. 

Cognitive Enhancement with Cogniceuticals

Cogniceuticals are brain enhancement drugs that improve human "knowing" functions such as memory, learning, and attention.  Think steroids for the brain.  The best known and most widely used are Ritalin and Provigil. 

While developed for other reasons - Ritalin to treat attention deficit disorders and Provigil to treat sleep disorders - both enhance concentration.  This makes them popular in settings where long periods of concentration are required.  Despite being illegal without a prescription, these drugs are commonly used in military settings, on Wall Street, in Silicon Valley and on college campuses.   

The British science magazine Nature recently polled their mostly scientist readers (paid subscription required) on their use of cognitive enhancement drugs and 1400 responded.  The poll results were:

• 20% used cognitive enhancement drugs
• nearly two-thirds said they knew of a colleague who used cognitive enhancement drugs

While Nature requires a paid subscription, there is a good summary of the study on WebMD that also covers the potential side effects associated with the use of these drugs.

The next decade will see the release of many more brain enhancing drugs to help the growing number of aging baby boomers afflicted with brain related diseases like Alzheimers.   While not directly related to small business, it is a longer term trend that is worth being aware of.   

Most Middle Class Millionaires are Entrepreneurs

According to the recent book The Middle-Class Millionaire over 80% of middle class millionaires - defined as households with a net worth between $1 - $10 million dollars - either own their own business or are part of professional partnerships.  Also, almost two out three middle-class millionaires consider "obtaining an ownership stake in your work" very important to financial success.

The authors also define this segment as "the working rich" and "the new rich".  They say they make up roughly 8.4 million U.S. households, which is about 7.6% of all households.  While this group has achieved substantial financial success, the surveys and research by the authors show that the vast majority of this group do not feel financially secure enough to stop working.   

The book says that the number of of millionaire families in America "will increase by about half again over the next decade."

I found the attitude descriptions of the new rich quite interesting, especially their attitudes about working where they could tap into "the Flow of Money" and the new rich "Playing to Win." 

Overall the book is quite interesting and well worth reading. The authors have a blog with a post listing the book's reviews. 

The Increasing Power of Online Reviews

The Society for New Communications Research recently released a study showing that online consumers are increasingly using online social media to share their personal customer service experiences and learn about others’ care experiences during their purchase decision process.  According to the study:

• Almost 60% of the study respondents used social media to vent about poor customer care
• Over 70% research companies’ customer care online prior to purchasing products
• 74% choose companies/brands based on others’ customer care experiences shared online

Echoing the results of the Society study is an article from Entrepreneur titled Marketing in the Recommendation Age.  Key quote on the use of online reviews and recommendations:

"Studies .... are finding that 80 percent of readers' purchasing decisions are influenced by customer reviews. And 70 percent of them say they share business reviews with friends and family online."

We've posted in the past on the increasing importance of online user reviews in the customer purchase decision process.  These studies show that the power of online user reviews continues to grow. 

The Death of U.S. Manufacturing Greatly Exaggerated

In his NY Times op-ed piece The Cognitive Age David Brooks points out that if measured by output U.S. manufacturing is still world class.  Key quote:

"Instead of fleeing to Asia, U.S. manufacturing output is up over recent decades. As Thomas Duesterberg of Manufacturers Alliance/MAPI, a research firm, has pointed out, the U.S.’s share of global manufacturing output has actually increased slightly since 1980."

What has happened, of course, is that U.S. manufacturing employment has fallen substantially over the last 2 decades.  The chief driver of this employment change is not outsourcing but technology.  From the article:

"The chief force reshaping manufacturing is technological change (hastened by competition with other companies in Canada, Germany or down the street). Thanks to innovation, manufacturing productivity has doubled over two decades. Employers now require fewer but more highly skilled workers. Technological change affects China just as it does the America. William Overholt of the RAND Corporation has noted that between 1994 and 2004 the Chinese shed 25 million manufacturing jobs, 10 times more than the U.S."

 

Ultra Light Small Businesses

Got pointed to an interesting Facebook group called Ultra Light Startups.  This group is focused on creating online businesses as quickly and as cheaply as possible.  They describe their methods as:

• launching "quick and dirty" proof of concept ventures (websites, Facebook apps, Mobile apps, etc) using outsourced talent, open-source/off-the-shelf software components, virtual/cloud computing services and minimal capital
• Build a prototype on "outsourcing marketplaces" like oDesk, guru.com, eLance, rentacoder, etc and go on to become more legitamate (funded, staffed, etc.) once the market has been proven.
• Share advice and best practices for launching companies.

In our research we see a lot of companies that started using lightweight methods.  Most are online companies.  But we've also see businesses that use ultra light methods to make physical products, and recently profiled two of them - Crit Buns and My Beating Heart. 

There are many reasons why millions of new small and personal businesses are started each year in the U.S.  But a key reason is the cost of starting a business and the capital required continues to decline.   

6 Million Small Businesses Started in 2007

The Kauffman Foundation recently released their annual Entrepreneurial Activity report for 2007.  According to Kauffman, roughly 6 million small businesses were started in 2007.  Also, the entrepreneurial activity rate increased slightly over 2006.  Some of the key findings:

• Immigrants continue to start businesses at a much higher rate than native born and the spread is increasing.
• Men start businesses at a much higher rate than women and are now twice as likely to start a business.
• The entrepreneurial activity rate for Latinos increased substantially in 2007.

The report also has detailed data by state and major metropolitan areas.

Maker Faire and Small Business

Maker Faire is one of the most interesting and unique events around.  Put on by Make Magazine, the event is described on their website as a "two-day, family-friendly event that celebrates the Do-It-Yourself (DIY) mindset. It’s for creative, resourceful people of all ages and backgrounds who like to tinker and love to make things."

An estimated 60,000 people showed up this weekend to attend the show and see the 600 exhibits -everything from a giant replica of the old mousetrap game that covered hundreds of square feet, to life sized mechanical dinosaurs, to robotic model warships, to light emitting jewelry.  The big, outdoor exhibits (like the mousetrap game) get most of the attention.  But the halls are filled with lots of interesting crafts, toys and electronics. 

While the purpose of the event is to celebrate people building things on their own, this is also a business show.  I talked to dozens of "makers" who sell their creations and many others that hope to turn their Maker Faire projects into a business.  There were also lots of companies exhibiting who sell tools and supplies to the makers.  While some big corporations were there, most were small businesses. 

In our research we've seen many small businesses that started as hobbies.  The progression often goes from hobby to part-time small business, to personal business, to small business.  Usually the driver to start a part-time business is either someone asks to buy a product, or the hobbyist wants to fund the cost of hobby supplies.  We heard both stories many times this weekend at Maker Faire.

The DIY movement continues to grow.  So does the related craft movement and the related consumer movement we call the emerging buy local coalition.  These combination of these trends is creating new opportunities for small and personal businesses.   

Robotic Squirrels and Lizards

We tend to focus on trends and technologies that will impact small business over the next 3-5 years.  But we also follow longer term trends, and robotics is a trend that is increasingly showing up on our radar screens.  The last couple of weeks there have been several interesting robotics stories in the press.

The Associated Press has an article on robotic animals being used by scientists in animal behavior studies.  From the article :

"Rocky (the robotic squirrel) is among many robotic critters worldwide helping researchers observe animals in their natural environments rather than in labs. The research could let scientists better understand how animals work in groups, court, intimidate rivals and warn allies of danger."

I'm no expert on animal behavior, but it seems to me that if the other squirrels are willing to court Rocky the robotic squirrel they are pretty dumb.

Ecommerce News has an article on broader uses of robotic technology called Ready for the Robot Revolution.  The article focuses on using robotic assistants to help care for senior citizens:

"Robots can remind us to take our medication. Robots can carry things for us. Robots can keep us better connected with our families and caregivers. Robots can even entertain us," said Trower. "And the cost of the robots to do this will be far cheaper than human assisted care."

Robots are increasingly being used to carry out dangerous tasks or missions.  The folks at iRobot, who make the well known Roomba robotic vacum cleaner, also make a line of warfighting and first responder robots. 

Robots are already popular with hobbyists and kids.  Over 1500 teams and 20,000 kids and coaches competed at the recent First Robotics Championships.   Lego Mindstorms robotic kits and products are driving a lot of interest in this space.

And, of course, the book Love+Sex with Robots got a lot of attention earlier this year with its prediction that within 50 years people will be falling in love and having sex with robots.  Hmmm... maybe squirrels aren't so dumb.  Maybe they are just ahead of their time. 

 

The Artful Blogger Journal

Stampington and Company, a publishing company targetting the arts world, has released a blogging journal specifically for the arts and crafts market.  It is called Artful Blogging and it targets artists interested in blogging as a way to reach their audiences.  I think it also would make a nice coffee table book. 

Basically they are saying that the Internet in general and blogs in particular have become marketing and CRM tools for artists. Quote from their website:

"Innovations in technology provide new and exciting platforms for artists and writers to share their creative work with the world. The Internet has come alive with the voices of artists who let us into their studios and into their lives by keeping online journals, galleries and blogs."

This is another sign of growth in the arts and crafts industry.  I recently posted on the size of the quilting market ($4 billion in the US), and it is my least read post of all time.  Despite that, we will continue to research and cover the arts and crafts industry - hey, the craft industry is clearly growing, there are a lot of people making a living doing this stuff, and almost all of them are small business people:).  Besides, I like crafts - including quilts. 

I saw this on the Craft Boom blog. 

Manufacturing Boomerangs Back To the U.S.

Article in the Wisconsin Small Business Times discussing manufacturing moving back to the U.S. from China and other place overseas.  Quote on the manufacturing boomerang trend:

"Select manufacturers in old-line industries such as investment casting, injection molding, precision machining and tool-and-die making are routinely taking business away from their Chinese competitors."

The companies profiled in this article are using technology and automation to cut production costs, increase their flexibility and speed up their product development and delivery times.  For example Signicast, who make metal components and castings, focuses on speed and flexibility.  From the article:

"Signicast’s use of automation and the four different manufacturing modules enable the company to respond quickly to new orders and to requests for changes. That speed and flexibility give Signicast a significant edge over foreign competitors.

"“Speed is everything, and it’s one thing that China can never do,” McDonald said. “Quality is one thing they can improve on. But we can, from conception, to tool up to approval, have a product run in less than nine weeks now. In China, lead time is more like 20 or 30 weeks once they have the tool built.”

Reich Tool and Design is also profiled.  They are using a niche market strategy:

"Instead of trying to compete on price, Reich Tool & Design Inc., a tool-and-die manufacturer based in Menomonee Falls, is working to develop niche manufacturing capabilities in aerospace, medical and energy exploration - areas it believes that Chinese manufacturers cannot compete."

A third company discussed in the article, Plastic Components, uses a low cost strategy:

“Our tag line is, ‘Low Cost at Home,’” Duffey said. “We try to tell people to change their mindset, that they don’t have to go to the Third World to buy parts at competitive prices. They can get them in Germantown, Wis.”

Despite the boomerang effect the majority of off-shore manufacturing is not going to come back to the U.S. But rising overseas labor and transportation costs, coupled with increased domestic use of automation and technology, is making U.S. manufacturing increasingly cost competitive.  Add to that strategies built around niche markets, customization, flexible systems and delivery speed and a number of U.S. manufacturing sectors are effectively competing with overseas competition.

I saw this on the MFGx blog. 

Global Food Problem Round Up

Lots of recent press on the impacts of rising food prices.  Recent food price increases are quite impressive:  in 2007 dairy prices were up 80%; grains were up a bit over 40%; cooking oil 50%; corn prices have doubled since 2006; and the price of rice, the food staple for billions around the world, rose over 100% last year.  These price increases are particularly hard on the 1 billion members of the global poor that subsist on less than $1 per day.

But there is one group that benefits from food inflation - farmers.  U.S. farm incomes are up and the price of farm land is rapidly increasing.  While most experts don't expect rapid food price inflation to continue long term, the consensus is higher food prices are going to be with us for a long time.  This long term increase in food prices will continue to help drive the growth of small farms and artisan food producers. 

Recent articles include:

1.  The Silent Tsunami  from the Economist: Is there ever a bad article in the Economist?  Even if you don't care about food inflation and the impact it is having, you should read this. 

2.  The New Economics of Hunger from the Washington Post via MSN:  a solid overview of what is going on in the world food markets.  Key quote:

"The food price shock now roiling world markets is destabilizing governments, igniting street riots and threatening to send a new wave of hunger rippling through the world's poorest nations....At least 14 countries have been racked by food-related violence."

3.  The Environmental Cost of Shipping Grocerys Around the World from the NY Times:  covers the environmental impacts of the globalization of the food supply.  From the article:

"Increasingly efficient global transport networks make it practical to bring food before it spoils from distant places where labor costs are lower..... But the movable feast comes at a cost: pollution — especially carbon dioxide, the main global warming gas — from transporting the food."

4.  Hundreds Protest About Food Prices in Senegal from Reuters:  pretty typical article on the food protests that are happening in many developing nations.

5.  Clean Water's Disappearing Act in the Contra Costa Times: covers the impact of the drought in Australia and other water related issues on the global food supply.

6.  Food Crisis: UN to reveal battle plan from the Times of India:  story on the UN trying to react to rising food prices.  Quote from UN secretary general Ban Ki-moon:

"Ban estimated that around 100 million of the world's poorest who previously did not require help now can not afford to buy food."

7.  Scientists focus on making better soil from the Boston Globe via the IHT.  The good news around rising food prices is it spurs innovation.  Better dirt leads to better crops.

Mobile Phone/Computing Round Up

Lots of interesting recent articles and information on mobile phones, mobile devices and mobile computing.  Way too much to post on.  Here are the ones I found most interesting:

1.  Mobile phone sales continue to grow.  According to Strategy Analytics there were 290 million cellphones shipped in Q1 of 2008. 

2.  Marketing Charts (great site, BTW) has a post on IDC's Q1 cell phone sales number.  They say 291.6 million were shipped.  They also have market share numbers by major vendor.  Nokia leads with almost 40% of the market.  They also have a recent post on mobile display advertising.

3.  These sales numbers are likely why movie director Spike Lee and Nokia are teaming up to make movies designed to be viewed on cell phones.  According to an article in the NY Timess this is an experiment for both Lee and Nokia.  Quote from the article on why they are doing this:

"The project is an experiment for Mr. Lee, but it is also a way for Nokia to promote its wares. Cellphone companies are all trying to position their products not just as devices for talking, but as multimedia devices that can play music, search the Web and capture video."

4.  More from Strategy Analytics.  They are forecasting that consumers and advertisers will spend $102 billion on mobile media in 2012.

5.  Good article on News.com about the linkages between mobile and cloud computing.  This is something we've posted on in the past and continue to research.  Our current research is focused the impact of the combination of mobile computing, cloud computing and the local internet will have on small business.

6.  Gizmag has a review of the HTC Shift, which is an ultra compact mobile computing device.   It is a great example of one of the many mobile computing device form factors competing for consumer acceptance.

7.  A little older (March) but something I missed is Forrester's forecast that European mobile internet usage will surge over the next 5 years.

8.  The BBC says Cuban cell phone use is expanding due to Raul Castro easing restrictions.

9.  Korea is a leading edge market for cell phones, so it is always worth seeing what is going on there.  According to Telecoms Korea half of all cell phones on the market in that in country in 2011 will have touch screens.

10.  The LocalMobileSearch blog has a post on the increase in mobile phone only housholds.  It is up to roughly 12% in the U.S.  Meanwhile, the percentage of of land line only households is down to 16%.  The data is from the Center for Disease Control, which I find an interesting source.  I think Twitter is much more detrimental to health than cell phones. 

The growth of mobile computing was the top technology trend for 2008 on our Consensus 2008 Technology Trends list and also on our 2008 Top 10 Small Business Trends list.  The vast amount of coverage this sector gets shows just how quickly computing is going mobile. 

Fear the French

Foreign Policy magazine's article The Coming Euroinvasion is on the weak dollar leading to European firms aggressively buying U.S. companies.  From the article:

""I am not worried about rich Arabs; it’s the French who worry me.” This was the response from a businessman in Clovis, California, reacting to my comment that the U.S. government was concerned about the influence of foreign-owned sovereign wealth funds."

The article goes on to talk about how the falling dollar has made the U.S. a much cheaper place to do business than Europe.  From the article:

"For many companies, moving across the Atlantic is the fastest and cheapest way to cut costs and become more competitive. The average hourly manufacturing wage in Europe is 16 percent higher than in the United States. Social insurance and payroll taxes are far steeper in Europe. As are energy costs: the average price of a kilowatt-hour for industrial usage in Europe is roughly 60 percent more than in the United States. Transportation costs are higher, too. And the cost advantages of operating in the United States don’t stop there. Land is still far cheaper in the United States."

But the appeal of locating in the U.S is not limited to costs.  Many foreign companies want a U.S. presence because of the large market and to access U.S. skills and talent.  Quote from an Italian manufacturing firm choosing to set up in the U.S.:

"It will not only be cheaper, but it will also place me and my engineers in the middle of a large cluster of leading-edge technology companies and in the largest market in the world."

The shifts in cost structures, aided by the falling dollar, is making U.S. businesses much more cost competitive.  In addition to leading to more U.S. exports and export opportunities, it is also resulting in more foreign direct investment in the U.S.  It is also increasing small business globalization - both in terms of driving small U.S. companies export more and by increasing the number of small foreign firms that set up operations here. 

We cover this topic in more detail in our most recent forecast report.

Sparkplugging - From Moms at Home to Homepreneurs

Interesting Problogger interview with Wendy Piersall, the founder of the blog  eMoms at Home.  She has changed her site's focus and rebranded its as a small and home business resources network called  Sparkplugging: Thinking Big in the New Work at Home Generation. 

The first thing in the interview that caught my attention was that eMoms at Home started as a hobby business, but grew into a real business.  In our research we continually run across this progression - interests and passions lead to hobbies, hobbies lead to hobby businesses and hobby businesses lead to real businesses.  This is a great example of this evolution.

The second point that caught my eye is her audience often does not define themselves as owners of small businesses or entrepreneurs.  Key quote from the interview:

"Another factor is that our audience, while extremely experienced in business, doesn’t really have a standard ‘label’. They don’t really consider themselves ‘home business owners’ nor do they consider themselves ‘true entrepreneurs’. They are a vastly diverse group of amazing people that kind of fall in between those two stereotypes, and call themselves things like “author, blogger, consultant, freelancer, moonlighter, marketers, or tech geeks”."

In our interviews with personal business owners (one person businesses) we hear this all time.  They will say "I'm not an entrepreneur" or "I don't own a small business."  This is one reason why we believe most surveys understate the number of U.S. small businesses and their economic impact.  We also think this is a key reason why most traditional small business segmentation models miss this market.

I also found it interesting that her blog network more or less naturally moved from a focus on moms at home to a focus on working from home.  Quote from the interview:

"But in order to really serve our readers, I realized that we needed to position ourselves as a resource for people who use the internet and technology to create flexible work for themselves - both parents and non parents."

This interview nicely points out a number of the trends driving the growth of personal and home-based businesses:  the growing interest in worklife balance; technology and the Internet; the evolution of hobbies into personal businesses; and the increasing supply of information and support services targeted at this segment. 

I first saw this mentioned on the Small Business Survival blog, which covers another really interesting small business sector - small businesses in rural areas and small towns. 

Lack of Integrity in Hearst Magazine Marketing Update

About a year and half ago I posted on Hearst Magazines sending me a fake collections letter.  I used it as an example of unethical marketing.  I also used it as an example of how unethical marketing programs are going be uncovered and publicized via the Internet. 

I was reviewing my web traffic reports and found that my original post continues to be one of my most popular posts in terms of visits and page views.  The traffic all comes from search engines.  The post page has a Google page rank of 3 and it shows up in the top 10  search results for a variety of 3 and 3+ search terms related to Hearst Magazines. 

Since traffic to this post continues to grow my guess is Hearst is still using unethical marketing practices.  This is unfortunate.  While they may be gaining short term revenue from their tactics, I continue to believe they are hurting themselves and in the long run they will feel the impact.  Whether or not Hearst cares to admit and/or recognize it, marketing transparency is here to stay and unethical business practice will increasingly be exposed. 

Wall Street Journal on Suburban Farmers

One of the trends we've been tracking for some time is the growth small farms and local food production.  The front page of the Wall Street Journal discusses this in their article "Green Acres II: When Neighbors Become Farmers" (registration required). 

The article covers the growth of hobbyist farmers turning their front and back yards into mini-farms.  From the article:

".... has uprooted his backyard and the front or back yards of eight of his Boulder neighbors, turning them into minifarms growing tomatoes, bok choy, garlic and beets. Between May and September, he gives weekly bagfuls of fresh-picked vegetables and herbs to people here who have bought "shares" of his farming operation. Neighbors who lend their yards to the effort are paid in free produce and yard work."

The article points out that demand is coming from restaurants looking for fresh, locally grown foods such as arugula and kohlrabi as well as consumers.  Since it is a Wall Street Journal article, they cover the financials associated with these mini-farms:

"Start-up costs for a one-eighth-acre farm run about $5,500, says Ms. Christensen of Spin-Farming. That includes a walk-in cooler to wash and store fresh produce, a rotary tiller and a farm-stand display. Annual operating expenses, including seeds and farmers-market stall fees, can add about $2,000. Such a farm can generate $10,000 to $20,000 in annual sales, she says. That's "an entry point into farming to see if they have a talent for it," Ms. Christensen says. "Those that do will eventually be able to expand and increase that income level quite substantially."

The trends towards local food production are quite strong.  The emerging consumer buy local coalition, coupled with increasing food costs and more focus on environment is making small farms increasingly viable. 

New Website for Emergent Research

We've redesigned the Emergent Research website (for those who don't know, this is one of Emergent Research's blogs).  We've added a section with our recent reports, press, publications and other resources. 

Open Science

Scientific American has an article on web 2.0 tools and methods starting to spread to scientific research.  All academic research areas have been slow to adopt open and collaborative approaches to research.  Researchers worry that their work and ideas will be stolen, and others will get either the financial or academic credit. 

These concerns have led academic researchers - who by nature are not highly collaborative on average - to avoid Web 2.0 informaton sharing.  But that is changing as many scientists and researchers discover the benefits of collaboration.  Two key passages from the article:

"Science 2.0 generally refers to new practices of scientists who post raw experimental results, nascent theories, claims of discovery and draft papers on the Web for others to see and comment on.

Critiquing, suggesting, sharing ideas and data—this communication is the heart of science, the most powerful tool ever invented for correcting errors, building on colleagues’ work and fashioning new knowledge."

As science opens up, innovation will increase.  Also, as more research becomes more easily available potential commercial applications will be recognized earlier.  Open science will speed the already rapid pace of innovation - and lead to new business opportunities for companies and entrepreneurs. 

New Artisan Interview - Multi-Prenuer Joe Gebbia

Joe Gebbia is a 20 something new artisan multi-preneur.  He has founded or co-founded three different start-ups and works on all three at the same time.  His firms are:

CritBuns: manufactures fashionable, portable seat cushions that make it easier to sit comfortably for long periods of time.  Joe is the founder, CEO and only employee at Critbuns.

Ecolect: a library and community site on sustainable design.  It provides the tools and resources to make it easier to design and source sustainable products.  Joe is a co-founder and president of Ecolect.

AirBed and Breakfeast:   allows people attending events to share housing, save money and connect with others at the event.  Joe is one of three co-founders of AirBed.

I had a chance to catch up with Joe recently and talk to him about his businesses.  Here are the highlights of the interview:

How big are your companies?

CritBuns is really just me.  It started as a school project while I was at the Rhode Island School of Design.  The product proved popular and I am selling CritBuns all over the world now (see this USA Today article featuring Joe and CritBuns). 

Ecolect and AirBed are team efforts.  I found working on my own hard.  There was no one to bounce ideas off of and no one to get feedback and input - no one to critque my work.  I missed the team environment I had at school.  So I wanted to be part of a team again and had the opportunity with both Ecolect and AirBed.  Ecolect has 8-10 contributors spread out around the country and even several contributors outside of the US.  AirBed also has multple contributors, but most are here in SF.

How do you manage distributed work teams?

It is pretty easy to do these days.  We use Skype, Google Docs, Basecamp, email and texting to keep in touch and manage our work flows.  We recently started using Google sites as an intranet.  With the technology available today, it is both easy and cheap to manage remote teams and work flows. 

How did you end up with 3 simultaneous start-ups?

It was really an accident.  When I started designing CritBuns I wanted the product to be as environmentally friendly as possible.  To do this I had to do a lot of searching and hunting for sustainable products and suppliers.  I realized there wasn't an online community and content site focused on helping designers create sustaninable and environmentally friendly products.  So I started Ecolect.  AirBed just seemed like a great idea so I wanted to be involved. 

It isn't very expensive to start a business these days - especially web based businesses.  This makes it pretty easy to do multiple start-ups.  Even CritBuns, where we make a physical product, isn't expensive to run because I outsource a lot of work and most of the marketing is web based. 

Do you have any advice for potential entrepreneurs?

First of all, if you want start a company just do it.  Get started, get moving and just do it.  Also, if it is web based it doesn't have to be perfect when you launch.  You can fix things as you go along.  Get going, get it out and get feedback from real customers. 

 

Lots of Recent Press On Social Entrepreneurship

Lots of recent coverage of social entrepreneurship in the media.  Yahoo finance has an article called Introducing Social Entrepreneurship that covers the activites of Echoing Green, a social venture capital firm that funds and supports non-profits and social service organizations. 

New York Time Op-Ed contributor David Brooks has a column called "Thoroughly Modern Do-Gooders" that discusses the social entrepreneurship movement.  He describes this group:

"These thoroughly modern do-gooders dress like venture capitalists. They talk like them. They even think like them. That means that aside from the occasional passion for heirloom vegetables, they are not particularly crunchy."

Inc. also has a recent article on this topic.  I really like their definition of social entrepreneurship:

"Social entrepreneurs use cutting-edge, innovative business methods to promote positive social change. While profit is still the primary yardstick for assessing business, social entrepreneurs also measure the extent to which business makes a positive impact on society. Traditional nonprofits and citizen groups have been mainly distinguished by their benevolent intent. In contrast, social entrepreneurs stand out by their pragmatic emphasis on getting results."

No matter how you define it, social entrepreneurship is a rapidly growing small business segment. 

FedEx Contractor Classification Law Suit Update

Workforce Management has a good update on the various legal skirmishes going on related to the worker classification suit the IRS has filed against Federal Express.  Their description of the issue:

"Companies can create a more flexible workforce through the use of contractors, in addition to being able to avoid paying employment taxes. But worker advocates argue that such arrangements often amount to shams that let companies shirk both taxes and their responsibilities to workers who actually are employees under the law."

What is missing from this description is that a growing number of people want to be contractors.  They are seeking the flexibility and work/life balance advantages contract work brings.  Many also believe their contract wage rate more than makes up for lost benefits, and that being independent is actually more secure these days than working for a company.

We've posted in more detail on this issue in the past. 

Smartbrief and Information Overload

Information overload is felt by us all.  Simply put, there is too much information and too little time.  In response to this problem, a wide range of companies are providing information searching, filtering and sorting services to help people find relevant information. 

Smart Brief is one such example.  According to their website, is "a media company with a mission to save you time and keep you well informed."  They pick, distill and disseminate what they consider the best and most important news stories on a specific topic on a daily basis.  They send these stories to their users via a nicely formatted email with roughly 8-10 story summaries and links per day. 

Smart Brief has a very clever business model.  They partner with trade associations and corporations to produce industry specific "smart briefs".  This allows them to co-market with their partners.  It also means they have smart briefs on a wide range of industries.  I subscribe to 3 of their briefs: NFIB's Small Business smart brief, IAB's advertising smart brief, and their new leadership smart brief. 

I don't think Smart Brief does a better job of scanning for stories than I do.  And I still scan the Internet for information on small business.  But they do some of the work for me, they do it for free, and they save me time.  Hard to argue with that.