by: Geoff Ficke

by: Geoff Ficke

I am often asked if these are good times for new enterprise opportunities? Should I wait? Is the economy down? Is it a good funding market? Is competition too intense? These, and dozens more stated concerns are nothing more than self-imposed hurdles to movement.

Now is the best time in history to start a business, launch a product or offer a cutting edge new service. More people than ever before have jobs. More people than ever before own homes. More business incorporations are established each year than the previous year. Global prosperity is galloping along, with formerly poor countries like China, India and Malaysia, seeing spectacular growth (potential new customers for new products and services) in the middle class.

Much of what I just stated might seem at odds with the media presentation of a struggling economy. The mass media knows that bad news sells. It is in their interest to report the problems of General Motors, layoffs, health care benefit cuts and downsizing while ignoring the spectacular growth of jobs and small business more than making up for the fallen old lions of industry. Mass media has a goal of keeping readers on edge; uncertain about the future and discontented. Pay no heed, do your own research on current market conditions if this is a concern.

The opportunity to successfully start a small business, market an invention or new service is always dependent solely on the value, novelty and benefits of new offering. If there is an under-served market segment and you can identify a niche in a large market category, the time is always right to move ahead.

For many years I called on large national department store chains. Buyers always had a reason why now was not a good time to place an order. “Easter is coming”. “We have inventory next month”. “Let’s see how next weeks sale goes”. Always excuses. Meanwhile inventory on hot items was low and sales would be lost. It is the same with inventing excuses to delay an entrepreneurial opportunity.

My advice to students, clients and inventors is simply this: “Time is never an entrepreneurs friend”. I saw an entrepreneur lose a multi-million dollar contract purchase with Home Shopping Network by three days. Initial hesitation, self-imposed hurdles, lack of focus and mistakes in the development process caused needless and damning delays. HSN was fed up and placed the order with an inferior but better organized competitor. The loser of this race never recovered. The winner does over $20 million annual turnover with HSN and has built a strong international business. It is maddening to me how often delay equals opportunity lost.

Do not delay movement to commercialize an opportunity based on short- term business conditions, perceived or real. For example, interest rates have been historically low for the last several years. Recently they have begun to inch up. How high will they go? What effect might the rise have on ultimate success for my venture? No one really knows the exact answer. We only can state with certainty that rates go up, rates go down. Look at the historic averages and anticipate that these averages will hold true to form. Base your financial assumptions on the mean averages, but do not delay movement on a great idea because of uncertainty about one element. Remember; if rates go up, they rise for your competition as well.

Also, do not listen to negative nannies nit picking your project. If you have done an effective job of due-diligence, can identify your market niche as being under-served and can quantify an excellent financial proposition you probably have the makings of a successful business. You will certainly know more than the critics. It is easier for people to be negative than to encourage your interest in taking a risk. Risk equates to possible failure for most people. You will be changing your life and most people instinctively fear change.

I always encourage seeking advice from friends, family, valued experts and independent counselors. It is important to know as much about your projects strengths and weaknesses as possible before committing your energy and resources. I also know that successful entrepreneurs almost always have an inner compass which sorts through the mass of concerns, objections and negatives they receive. It is always easier to say no, not move forward, than to commit and push ahead.

America is teeming with dreamers and doer’s, all hoping to succeed in a cluttered, very aggressive marketplace. Delay is never a wise course of non-action if your project has real legs and commercial viability. Somebody else is potentially working on a directly competitive product. You can not afford to lose a first to market advantage because of dallying and uncertainty about entering the market at the optimum time. There is never a perfect time to start. There is only now, and now is plenty good enough.

by: Geoff Ficke

The American economic system of capitalism is unique in the industrialized world. Forms of capitalism exist in many countries, and the one general statement that applies to its usage is that capitalist countries are always more prosperous than non-capitalist states. That being stated, why is American capitalism so advanced, successful, admired and feared?

We all know that America offers the most dynamic advanced economy in the world. Brands such as Coca-Cola, McDonalds, Estee Lauder, IBM, MicroSoft, Kentucky Fried Chicken and hundreds more are badges of the amazing success of the American model in achieving worldwide prominence. Each of these enterprises were born of entrepreneurial roots, grown with care, and gracefully matured into powerful engines of profit. Other countries can proudly point to their own corporate successes (Finland and Nokia, France and Schlumberger, Chanel, Ireland and Waterford, etc.) No country, however, sports the depth and variety of colossal world brands as the United States.

So what accounts for the amazing growth and breadth of successful American enterprises in a very competitive global marketplace? And, what makes the American field of play so different and compelling as a job, profit and opportunity generator? There are many reasons that can explain parts of the template for success. However, an alpha element is that the United States system does not permanently cripple an entrepreneur who has experienced failure, even several failures.

Many successful entrepreneurs, while enjoying the fruits of their successful efforts, have also suffered the agony of failure. The American model does not insure the right to succeed, jut the right to try. This is not true in most other capitalist countries. Failure is not an option. Barriers to entry are high. Taxes, fees, regulations and restrictive covenants are almost universally more difficult than in America.

The opportunity to fail is not something that any entrepreneur initially considers as an asset. However, it must be considered that most new enterprises do not succeed. Business closings and bankruptcy is very high for new enterprises. Many entrepreneurs, having suffered the disappointment of failure, simply move on and look for a regular source of income. Real entrepreneurs will not give up. They have the genetic makeup necessary to succeed as an entrepreneur. They will keep trying.

I can attest to the difficulty of being an entrepreneur in other capitalist countries. I have started businesses in England, France, Sweden and Spain. When seeking to organize in these capitalist (to a varying degree) countries I was amazed at how difficult it was to satisfy the state. Upon reflection, exploring and experiencing the vagaries of these bureaucracies, I discovered a blunt answer for the very high real costs to enter a new business: these states use extreme barriers to minimize the chance for failure.

Fortunately it is just the opposite here in America. Small business incubators, regional business development centers, university entrepreneurial programs and mentoring organizations encourage the attempt to create opportunity for new enterprises. The result is a wildly vigorous stream of new product, invention, service and enterprise seeking to capitalize on the American economy’s vigor and need for constant sources of growth. All of this occurs while the risk of failure remains daunting for new start-ups.

The growth of the American economy can be attributed to the constant stream of small companies supplying ingenuity, new products and rapidly growing sales and income streams. Virtually no new jobs have been added in Europe over the past two decades. In 2005, America generated over two million new jobs alone.

Growth of the United States economy is not being driven by the mature multi-national companies associated with prosperity in the past. IBM, GE, General Motors, Delta, Delphi, and dozens of other formerly powerhouse firms are downsizing, firing employees and trying to re-invigorate their static business models. The growth of thousands of small businesses entering this vibrant marketplace is the real generator of growth, jobs and profits. The reality that many fail and a few succeed is the strength of the system.

The high barriers to entry applied by so many of our capitalist competitors minimizes their ability to be creative, innovate and take appropriate risk/reward decisions in this brutally competitive global market. This attempt to insure success is actually the death knell of real opportunity.

by: Geoff Ficke

The American economy is the growth engine of the industrial world and will continue to be so, as long a steady stream of innovative, divergent products is successfully created. The history of capitalism is replete with cycles of unique, needed product and technology advances that exponentially expand the economic base and evolve into completely new industry categories. No country comes close to America in dynamism, creativity and energy in pursuing cutting edge new growth opportunities.

Why is this so? Many other countries have a much longer historical pedigree with features of freedom and capitalism as significant foundations of their heritage. Old Europe has been trading, exploring and investing for centuries before Jamestown and Plymouth were settled. The Dutch, British, Venice, Swiss and Spanish have wondrous commercial histories. The Japanese and Chinese were commercial powerhouses before the Europeans. And yet, none has left a commercial footprint like the United States in just over two centuries of enterprise.

Why? The answer is the constant curiosity, drive and ingenuity inherent in America’s unique form of capitalism. This is most clearly reflected in the risk/reward benefits gleaned from an almost endless stream of product inventions. Hugely significant new industries are in existence solely because of the divergent nature of the product, technology or service created.

A divergent product or service is one that did not exist before its invention. The wheel was a divergent product. The radio was a divergent product, as was the airplane. Computers, lasers, McDonalds franchises and hearing aids are examples of products that were divergent and first to market movers.

Today we take the radio for granted. However, when invented it was an amazing device, truly divergent, revolutionary, a breakthrough. Many refinements, improvements, and new features have been added to the original radio apparatus. Radios have been enhanced with clocks, alarms, lights, FM, placed in cars, portable and satellite delivery. These new benefits and performance embellishments are dependent on the original ground breaking radio product platform and are convergent products. All add to the usability of the radio and generate income, but, without the original invention, they would be of little consequence. The radio was, and is, the home run divergent product.

The result of the continual creation of divergent products and technologies is to continually fertilize and grow these industry segments with ancillary convergent business opportunities. The computer begets the software. The software attracts bugs and security services are required. New retail categories are required to sell the computers, software, security and accessories. Service companies evolve. A whole new industry has been developed on the shoulders of the original divergent invention.

Critics of the American capitalist model rarely consider the huge benefits modern society enjoys from the creation of these divergent technologies. One elemental example: the light bulb. Light bulbs provide safety and the opportunity for people everywhere to more productively utilize evening hours. Light bulbs are manufactured in dozens of countries, providing jobs and sustenance. Bulbs are made for innumerable uses. They must be transported, warehoused, marketed and sold. The result is a complete supply chain benefiting every human utilizing this simple, but amazing divergent product. This is a fantastic benefit provided by capitalism and divergent technologies.

When Thomas Edison invented the light bulb he had no real knowledge of the potential universality of the product at that time. There was as yet no power grid system available to deliver the electricity required to light the bulb. He was seeking to solve a problem, answer a need and make a profit. He could have failed, and he did so many times. However, he kept trying and his effort was rewarded.

American capitalism rewards effort, drive and, of course, success. Uniquely, in America, failure is allowed. Failure is not regarded as finality. Americans are encouraged to try, and if they fall down, get up and try again. Almost every other society punishes failure with a different outcome, a very negative outcome. The result is a lack of creative risk taking, a lack of dynamism.

Virtually no net job growth has been created in Europe in the last 20 years. European states place huge barriers in the way of starting a business, commercializing a product or organizing capital. The successful Japanese model of the 1970’s and 1980’s has declined precipitously, and was largely based on manufacturing clones of convergent products created in America.

Korea, India and China are currently under political and media scrutiny for the imbalances they enjoy in trading with the United States. However, name a single divergent technology, product or service proprietary to any of these countries. There are none. They are formidable competitors for resources, but they are not inventors and will not, at least yet, be competitive in creativity. Low cost, low margin production, product duplication and industrial theft are not long term strategies the United States should fear.

Rigid socialist, centrally planned economies by their very nature can not be creative. The free flowing nature of American capitalism is a blessing for this country, and the few other countries (Hong Kong, Canada, Singapore) willing to let humans do what humans do best: enjoy freedom and seek personal opportunity. Much like the food chain, where the ox-pecker lives off the ox, we need divergent product advances to feed the desire of convergent enterprises for fresh growth opportunities. No country yet approaches America in industry pioneering, nurturing and growth.