Teamwork. (Image: Thinkstock)

Some entrepreneurs come up with the perfect idea at the right time at the right price and execute the right go-to-market plan while the stars are aligned, make truck loads of money, sell their companies for millions (or billions) and jet off into the sunset for one of Puffy’s or Sir Richard Branson’s parties.

The rest of us don’t have it that easy.

To be a success you have to be very smart about how you manage your money, time, business and energy.  The stamina it takes to build a successful business is rarely discussed but it is very real.  Day in and day out, you are working to grow the business.  You wake up thinking about your next move, during the day you execute that next move, in the evening you’re thinking about the move after that.  Over time, this has a definite impact on your mind, body and family.

With the extra pressures of the sludge economy we’re currently working through, and with capital being a bit more difficult to come by, you should consider collaborating with other entrepreneurs to take your idea or existing business to the next level.  As entrepreneurs, we are always eager to prove ourselves and show off our business chops, so initially the idea of collaboration may be a turn off. You may think that anyone interested in the same business as you is a competitor.  You may also feel that collaborating is an admission of entrepreneurial weakness.  I understand where you are coming from; but I encourage you to embrace new perspectives.

Without shame, Fortune 500 companies use collaboration to their benefit.  In fact, large companies would select collaboration over innovation any day because their number one goal is to reduce risk and make more money.  That’s why large companies buy smaller companies that have come up with something new and proven.  Even if it sounds good, big companies want no part of it until it is a proven product or service.  That’s also why they team up with other Fortune 500 companies to produce events, create new products and conduct research—because it spreads the risk around and increases the chances for success when you have multiple people with various skill sets working on a problem or opportunity.

Use this strategy to your advantage. Instead of a publicist, accountant, attorney and chef starting four separate businesses—such as a PR firm, accounting firm, law office and restaurant—those same four professionals could join forces and start one company.  For example, if they launched a catering business, the publicist could work on marketing, PR and sales; the accountant could manage the businesses’ finances; the attorney could handle contracts and other legal matters; and the chef could prepare the food.  When problems arise, there would be four smart people to figure out a solution rather than one person jumping through hoops alone.

And there would be four times the resources and networks to tap into to grow and position the business for long term success.  Sure, they might each only own 25 percent of the company but 25 percent of a million dollars is much better than 100 percent of $50,000.  Nationally, businesses that have multiple people working in them earn seven times more revenue than businesses operated by solo entrepreneurs.

I know it feels good to the ego to say, “I did all of this myself,” but you may find in these tough times that you’ll have a better quality of life, solve problems faster and make more money if you engage in cooperative economics by collaborating with other entrepreneurs.

Felicia Joy is a nationally recognized entrepreneur who created $50 million in value for the various organizations and companies she served in corporate America before launching her business enterprise. She is the author of Hybrid Entrepreneurship: How the Middle Class Can Beat the Slow Economy, Earn Extra Income and Reclaim the American Dream and a regular contributor on CNN. Follow her @feliciajoy.

1.    Identify your target customer. If people who support a certain type of charity aren’t likely to buy your product, you’re wasting your time. Start backward by first identifying the age, income bracket, and lifestyle characteristics of those who will most likely support your product.

2.    Learn customers’ interests. Once you know your customers you can determine their favorite causes. If most of your customers are in their early 20s, it might not make sense to partner with a PTA. You’ll want to find organizations that serve people similar to your current customer base.

3.    Have a stake in the group’s success. Remember that the group you partner with reflects upon you as a business owner. Make sure the organization is one you can stand behind since customers will judge you based on the organizations your business publicly supports.

Tamara E. Holmes is a frequent contributor to Black Enterprise.

Chapter 7: Being Women in Business

Renée

The roles that men and women occupy in business are incessantly evolving. And so are the opinions about which roles women should play and how they should handle business situations. The roles women play around the world and throughout the country are so different. A “true southern” woman seems quite different from a northern woman but in many ways we are all the same. Kirsten and I have been friends for nearly two decades and oftentimes the more differences we appear to have the more similarities we actually have.

I know that sounds so to the contrary, but it is so true. I think many of our core values from our parents are the same. And today we still believe in the same philosophy—work hard, trust in family and keep God in your life. We have always sought to be professional, which is a characteristic for both men and women—but the one thing that Kirsten and I truly were always on the same page about was that we weren’t trying to be men in business, but good businesswomen. We embraced our sensitive, compassionate and feminine sides. We always tried to mix good sound business practices with our woman’s intuition.

In fact, when we haven’t listened to our intuition or that inner voice, we’ve fallen short and inevitably something has gone awry.

Many times when we meet prospective clients, we have an initial gut reaction about whether they’ll be difficult to work with or not. Initially, when we started our company, we took a few too many jobs because we felt we needed the business. We should have said no more often, but I was thinking of the bottom line. Kirsten “always” knew when a client would not suit us well. Today, we can somewhat pick and choose. There is not a situation when we don’t see the writing on the wall. One example is a nonprofit we were working with for several years—from the first moment I met their new director, I knew that this would be our last year. After the initial meeting, I came back to the office and told Kirsten: “She doesn’t like me, us—Noelle-Elaine—and we will not be working on this account much longer.”

Kirsten Poe Hill (left) and Renee E. Warren (Source: Regina Fleming Photography)

After the event ended, the director indeed told us that this would be our last venture with them. Throughout the evening of the black-tie event, the director’s incompetence, insecurities and just sheer lack of knowledge were apparent to all. Even basic principles weren’t followed. Mayor Bloomberg attended the event, and my staff asked our photographer to follow the mayor, and this director informed me that we didn’t need to do that because the mayor had a photographer with him. I insisted that we did because if we did not have our own photos, then we could not get one to the media. Anyone who has been in the public relations business would realize the mayor’s photographer works for him and not our organization and it would take days to get them to send us a picture and by then it would not be news.

Kirsten and I were always able to spot news and knew how to get our clients in the paper, and if the mayor was attending an event, that was a picture we could send to the Style section of the New York Times.
We also knew that being women had its advantages and disadvantages. The advantages or benefits, we never turned down. For the past fifteen years since we have been in business, typically only one guy has worked for us at a time. It’s not that we don’t hire men, but typically more women apply for the positions or we are attracting more women. We get our testosterone from our events, which usually have lots of men in attendance—in fact, for a long time we worked for some very male-dominated firms and organizations. We didn’t complain. All the women welcomed it—in fact, as single women we jumped for joy. We were traveling all over the country and world and would meet a variety of different men—it was always exciting.

In our office, because it was always women, when our service people would come to visit, they would oftentimes not even charge us. We would have technicians come into our office to fix the copier, fax machines, telephone lines—and they would actually think that we were “stupid.” Okay, you’re thinking to yourself, why would these smart women allow someone to think they were ignorant about the inner workings of the technology in their office?

We weren’t that stupid — in fact, we were pretty clever because we were watching the pennies and receiving free services. And the truth of the matter is that Kirsten or I, or even the office staff, didn’t know anything about computers and welcomed the help. Of course, we could have read the manual, but we found our time better served sticking to planning events and discovering new venues to hold our next events.

Different focus!

Published by arrangement with Plume, a member of Penguin Group (USA), Inc.

Copyright © Kirsten Poe Hill and Renee E. Warren, 2009.

But most didn’t realize the behind-the-scenes struggles the two have endured in the 15 years since founding Noelle-Elaine Media.  The pair have put together a book that uncovers the truth about starting, running, and expanding a business in You Buy the Peanut Butter, I’ll Get the Bread: The Absolutely True Adventures of Best Friends in Business. (Excerpt here)

You Buy the Peanut Butter doesn’t just tell the success story of Hill and Warren. It also serves as a personalized business guide that reveals the professional and personal hardships the two have gone through — from IRS troubles to balancing marriage and career to surviving on peanut butter sandwiches when the company hit lean times.

Because You Buy the Peanut Butter tells the back story, the book connects with almost anyone in business, particularly women. Typically business books either focus on the success of a company or are pure entrepreneurial how-tos. But You Buy the Peanut Butter takes it a step further by offering real-life stories as examples of what to do and what not to do in business.

BlackEnterprise.com: Why did you decide to personalize the book?

Kristen Poe Hill: We wanted to tell the real story. There were times we would be hosting red carpet events while struggling to find clients. Or we’d be on the road rushing to find a bank to deposit money into our corporate account so we could make payroll. We didn’t just want to show ourselves [in the book] as two strong, successful business women. We wanted to get the point across that if we could go through all the ups and downs and still be able to survive and thrive, then you can too.

Renee E. Warren: Readers will be able to relate to our story as well as learn lessons from our mistakes.

What was the toughest lesson?

Hill: I think it was when we learned we owed a substantial amount of money to the IRS because our accountant had not been paying payroll taxes for a number of years. We found this out when Renee went to buy a house and had a financial check done.

Warren: We had been using the same accountant for years and had become too comfortable with having someone else that care of those matters, even though we had some suspicions. He wouldn’t answer basic questions such as how much money we were bringing in, but we trusted this person. And this came in our 11th year, when we figured we had most of the bugs worked out.

Kirsten Poe Hill (left) and Renee E. Warren (Source: Regina Fleming Photography)

How did you get back on track?

Hill: First, we worked out a plan with the IRS. Then Renee and I sat down to figure out how we get new clients. We met with our employees to tell them they needed to be more self-sufficient, as Renee and I would be focused on bringing in more clients. And we got two new accountants, one for myself and one for Renee. This has worked out great because we have a system of checks now in place.

What was the business lesson learned?

Warren: That you should always double check a job someone’s doing for you — even if you trust that person. Make sure any questions you have are fully answered.

There was another story in the book about how the company became too dependent on one client.

Warren: This was a lesson we learned early on. We had gotten caught up in the project, the money was rolling in, and we didn’t reach out like we should have to expand our client base. So when we lost this client, it really affected our bottom line.

What was the lesson there?

Hill: Not to become dependent on one stream of revenue for our business. If you lose that client or that client goes out of business, you’re stuck. Use your Rolodex to find leads on potential clients.

In today’s economic climate, many more friends may decide to merge their businesses if they are in the same field. What would be your advice?

Warren: Make sure you both are in it for the long haul. Kristin and I both enjoy what we do and have a strong belief in our business model.

Hill: To make sure you are compatible as business partners, and have the same goals. Not all friends can work together. Also, figure out what each person is bringing to the deal — who’s good at what. Renee and I, though we were raised differently, have similar lifestyles and agree on our goals.

View an excerpt of You Buy the Peanut Butter, I’ll Get the Bread: The Absolutely True Adventures of Best Friends in Business here.

But going into business with a friend can be a risky endeavor. “There is a risk of meshing the business with friends, as now a dispute or difference of opinion not only affects the business relationship, it affects the friendship,” says business consultant Michael D. Brown, author of Fresh Customer Service (Acanthus Publishing; 2008) and CEO of the Michael D. Brown Co. “If not handled properly you can diminish and/or loose both the friendship and the business.”

But there are steps to take to help friends become friendpreneurs.

Agree on a vision for the partnership. Having a shared vision was the key to the successful partnership between high school friends Candace Sandy and Dawn Marie Daniels. Both entered the publishing field and at one point worked together at Simon & Schuster. Daniels and Sandy had a vision of creating self-help books for African American women. So, they authored one together, Souls of My Sisters: Black Women Break Their Silence, Tell Their Stories and Heal Their Spirits (Kensington Publishing; 2000). Realizing they found a unique niche, they formed Souls of My Sisters Inc. and have produced self-help workshops, published several follow-up books, created an online resource, and inked a publishing imprint deal with Kensington under which they publish self-help and inspirational books by other authors. “What is wonderful about this partnership is that two women can pool together their resources and have an opportunity to provide a service or a product to fill a niche and with the right strategy, hard work, and determination can become the American dream,” notes Sandy, who is also the communications director for Congressman Gregory W. Meeks (D-NY).

Define business roles. “Discuss each person’s strengths and weakness and map out who will do what within the company,” says New York-based business consultant Byron W. Perry, founder of entrepreneurial workshops Kids Inc. When Kristen Poe Hill and Renee E. Warren formed Noelle-Elaine Media, Hill says it was important that their work styles were similar. In business since 1993, the event management, media relations, and production firm counts such powerhouse companies as Black Enterprise, Ariel Mutual Funds, BET, and L’Oreal as its clients. To stay on the same page, the partners have an annual retreat in addition to their weekly staff meetings.

“Even if we just camp out at one of our homes, we have a strategizing session outside of the office,” says Hill, who recently co-authored You Buy the Peanut Butter, I’ll Get the Bread: The Absolutely True Adventures of Best Friends In Business (Penguin Group; Feb. 2009) with Warren. “This way we can map out our goals and plans for the future and bounce ideas off another without the distractions of the office.”

Talk money. “Figure out what each person is bringing to the table.” Perry says. “Will each invest money, or does one have the contacts and skills?”  For dentist Smith, discussing finances with his partner was easier, he says, because of their friendship.  “Having a business-first attitude allows us to prioritize the money conversations around that in a team effort,” he adds. “Put it all on the table, from how much money you have in the bank, credit history, family plans, expected income, etc. Don’t let friendship cloud your mind when making business decisions.”

Make it legal. “Devise a solid business plan and agree to a contract,” Brown says. “If there is no initial shareholder agreement and decisions are made on the fly and are inconsistent, this leads to chaos and instability.”

Merge. “Sometimes the best business partnerships with friends develop from businesses that merge,” Perry says. That’s what restaurateurs Joseph Dowell and William Parks discovered. Parks opened Mamma Nems.com in Stone Mountain, Georgia in 2006. Dowell meanwhile operated his own restaurant in New Orleans until it was destroyed by Hurricane Katrina. When Parks, who had no prior no restaurant experience, found himself overwhelmed with running the business, his longtime friend Dowell came onboard as an equal partner.  “I knew my financial investment would go much further in a restaurant that was already up and running verses opening a new one,” says Dowell on his decision to join Mamma Nems. “William and I share similar core values that keep the business strong and on a vision and the basic principles on how to get there.”

Friend time. In the office, Dowell says it’s important to put business first. “The friendship is separate from how you provide for your family,” he says. Hill and Warren also find while it’s a good idea to give each other space, they make time to socialize as friends outside of work. “At the end of the day, we are still friends. There’s Kirsten my business partner and Kirsten my friend.”

Conflicts and resolution. Emotions can run high when you are in business with a friend. To mount these hurdles, have a plan, Brown says. “Identify the dispute resolution methodology (i.e. Will a third identified person come in and help you solve personal and business disputes?) Decide how you will maintain the friendship if the business doesn’t go well or the business if the friendship doesn’t. Document a “prenuptial scenario agreement. If x happens, this is what will we do,” Brown advises. Compromising is also important, says Noelle-Elaine Media’s Hill. “Renee and I have always been open and honest with each other and that honesty has allowed us to clear any hurdles that may come up.  We do not always agree, but we do always agree to compromise when worse comes to worse.”