Posts Tagged ‘Startups’

So continuing with my previous post about fear I will like to remember a bit of my junior classes at college about the SWOT analysis you have to do for your business or organization. I do a SWOT analysis for almost everything, I think I’ve interiorized the importance of the idea and i want to share how this process can help us focus a bit more on the important things in these times when economy  suggests we do that. 

Strenghts

This are the things you have that make you rock. Every person in the world has at least one strength that makes them rock, every company has one and everything has one too. The first thing a business needs to do these days is ask themselves What makes us rock? What makes users come here everyday? What makes users watch every episode? What makes users post comments? or whatever your result measures are. 

Strengths are things people notice that makes them want your product instead of the one made by anybody else.  Strenghts are the resources you have inside, are the things you can work to improve. 

In this times we need to look to the strenghts and make them more powerful than ever starting with people. In the 21st century we all know brains are the most valuable asset so we need to start developing those in ways we’ve not done it before. That is our main strength, we could lose our computer, servers, HQ offices, or even our house, but we don’t lose the brains.

 

Weaknesses 

This are the things we suck at. It’s a very politically incorrect way of saying it, but we definitely are not doing enough to change our weaknesses into strenghts or neutral features. A weakness is a thing that will make users go away from  to other people’s product or service. In the times of recession we need to value every user we have so we need to take all of our time monitoring what weaknesses we have. The best way to do this is to accept all the feedback we can, read it and act quickly to solve any problems. If you solve users problems they will most likely love you. I know i will love a company that solves my problems easily or that adapts to serve my needs. 

You are allowed to have lot’s of weaknesses the only one you are not allowed to have is : lack of communication with your users.

 

So far all this has been written over and over again and all entrepreneurs know that they need to focus on their Strenghts and Weaknesses.

Opportunities and Threats 

Right now we have lot’s of threats and many people fail to see the opportunities blinded by fear. In my last post i talked about how fear may lead people to act in ways that will cause damage to themselves and to others. On this times of economic crisis what will bring an edge to us is focusing on the Opportunities, more than on the threats. Of course we need to focus on threats, our future depends on what we do to keep them away from us. But this times bring endless opportunities. Stocks go lower and lower as people sell, advisors rate some stocks on the “SELL” list, the truth is that when you are selling somebody else is buying and it may be Warren Buffet, he understands that when the market goes down he has an opportunity to buy.

Remember a bear market brings opportunities for investors and for businesses to start focusing on markets that they didn’t saw in the first place. So i suggest you do a postive check on the world outside to see who might be interested in your product or a variation of it, what companies that may add some know-how to your organization are on sale and for low prices or what skills are being needed that you had and thought will never use. 

 

SWOT all together

Finally if you are focusing on keeping the inside lean you will be able to react quickly to opportunities. Remember this is the theory they teach in every business school, in every first day at work or in every book about business. 

My intention here is to remember that the theory may work well this time. Stop focusing or entering in panic because markets are going down and start to focus on what  Strenghts you have that will make everyone keep coming to you, look at what people want from you that you are not offering (opportunities), on what other people are failing to achieve so you can do that (others people weaknesses are also opportunities) and finally focus on eliminating everything that makes you weak and a potential victim. 

So if you need to take a habit these days take the one of SWOTing all you see. Starting for yourself or your business to the pet shop (you can find opportunities there). It may seem like a time taking process, but in time you will do it naturally.

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President Roosevelt said that phrase back in the 1930’s when the a big recession was happening. I just read this article on Mashable where Mark Hopkins quotes Steven Hodson saying that we still can get up, even if we don’t learn from our past mistakes in past recessions.

The truth is that economy isn’t perfect and capitalism isn’t perfect either. Capitalism is the best system we know and for sure the one we must use, but we need to tweak it on the go for it to achieve it’s main goal: Bring wellbeing to all the human beings living under that system. But there is one thing we haven’t tweaked since the first recession occured some centuries ago: To take control of our emotions.

At this times when i see Wallstreet indexes fell down every day, when i think the Dow Jones should be renamed Down Jones, when all the main markets in the world plunge i ask myself how many of those points that the Dow Jones went down are of true value and how many are generated by massive fear. Many financial advisors (and i must confess that i’ve read the books, but not payed attention to the authors names) have always recommended to control fear when things like this happen, but we fail to do it.

Daniel Goleman and the numerous books about emotional intelligence try to teach us how our emotions work and how we can control them. Right this is a skill we all need to develop before getting into feeling fear that will only make things seem worse than they truly are. The first thing we need to do is sit and relax, then put some music that makes us happy and start analyzing the situation thinking that every business that is in the stock market has people inside, and this persons are capable of generating revenues that is what ultimately affects share prices. For example, Yahoo Inc. is a great company, they managed to build a wide user base around the world and add some amazing services to their portfolio (Flickr to name one of those).

Yahoo stock went down quite a lot this week and i wonder how many people have sitted down and analyzed the capabailities of Yahoo before actually starting to sell and push the prices down. Yahoo in my POV is a very capable company, they can in fact build a big social network based on the wide range of users they have using individual services like Yahoo! Sports, Yahoo Mail, Flickr, etc. They can also stop focusing on Ad generated revenue and start to offer services that people can use and leave the ads to the ad expert Google. I don’t think Yahoo is worth the price that it has right now (Disclaimer: This is not a recommendation or expert advice it’s just my opinion and though i know about finances I’m nowhere near an expert).

On the other hand we have many start ups that are being affected by this plunge as they see capital flyaway from them and sales projections being lower than they expected. The main problem i see here is that many Web Startups are not focusing to the global markets. While the US could be on a recession countries like China, India and Peru are growing at rates of over 7% anually. These markets are also potential costumers and everybody knows that a diversified userbase will always be a coverage to the risk of a recession in one country. I liked the message posted by Jay Adelson saying they got money to expand their operations abroad and to more markets, that’s a good way to go for Digg. I think that their international expansion will make them bigger and i hope they get a version in Spanish and German wich may blow it up both in Latin America (Including all the Latin People in the US) and in the European Silicon Valley (Germany).

So, as you see by this few examples things aren’t lost yet. Comapnies have capabilities inside that will make them work and get out of the recession just fine. The people that let themselves be controlled by fear will leave a opportunity for those who think more calmly, buy stocks or purchase full businesses to make lot’s of profits in the future and to rebuild the american economy. Warren Buffet buys every time something like this happens and he has became one of the richest guys in the world just with stock trading (which mainly is taking advantage of others people fear).

So the recession is here and companies will be affected, yes. But we need to start getting out or creativity and look at ways to overcome it. See my post Start me up where i explain how Calley Nye is looking for funds for her startup in a new way. The world is filled with creative and capable minds so we should not worry about it. Just remember: DON’T LET COLLECTIVE FEAR CONTROL YOU.