I help Retail and B2B companies determine their marketing ROI and what to do next in their marketing and sales to drive up their revenue.
Worked around the Olympics + B2B tech startups. Traveled the world, passionate about values-driven entrepreneurship.
I've built and scaled 3 management consulting businesses to $1M+ in the past 5 years. I'm a little unsure as to what your problem is. Are you wanting to help designers with their business or are you trying to hire talented designers to complete some work?
For really good designers, their desire is to do quality work, with clients they like and be compensated well for it. If you have a proven methodology or process that helps them get those types of clients you'll be off the races.
But, you have to communicate clearly the specific problem you address for them. So if they are a landscape designers you can say "With my program and coaching we will get you in front of architects and seen as the go-to expert who does awesome work." Does that make sense?
I run an online marketing agency for socially conscious retailers. We do conversion rate optimization, email marketing, SEO and PPC. We have 25ish employees and our clients represent $700M+ in revenue.
Generally no, VC's don't consider digital/creative agencies to be in their purview. The multiples for service-based companies like agencies are quite low (usually between book value to 1.5x) so it doesn't fit their investment model.
In my career I've met one guy who invests in agencies/consultancies. And that's because he's built and scaled several and sold them to Big 4 firms.
However, if you have a product with traction that solves a real problem for your clients you'd have the ear of an investor. That's how Hootsuite started.
I hope this helps.
Depending on average transaction size, number of transactions and the potential risks you are taking on (i.e what are you responsible for if your friends product or service isn't delivered on?). Anywhere from 2-20% could work depending on the above.
As for accounting, I would recommend keeping the transactions in a separately coded lines of revenue and expenses so you can clearly show the in and out flow of money for his app. It will be taxed as income so you can include that in your fee if you wish.
Also know that banks these days are very sophisticated with detecting fraud and money laundering so ensure you document the arrangement with your friend so you can easily show everything is on the up and up.
I hope that helps!
Before you weigh the pros and cons of different platforms structures it's important to think about who your customers are and how you want the business to grow.
I help companies find their most profitable customers and have worked with pre-revenue to high-growth $70M+ companies in the SaaS, consumer products and professional service spaces. We usually start our work by aligning around what the vision for the company is asking questions like "Where do we want to be in 3 years? Why?"
From there we think about how customers will encounter and use the product, asking:
- "Is it a business where relationships and high company involvement is needed after a sale is made?" A centralised business model is a good fit (more quality control).
- "Are we a service based business seeking to minimize risk while expanding?" Then a franchise model is better.
A business model/structure tumbles out having clear answers to these questions. One business structure is not inherently better than another. You're just picking the structure that best facilitates your business goals. Don't hesitate to contact me if you'd like to discuss your potential business model in more detail.
Hi there, I've worked for a VC firm running a consulting practice and advised pre-revenue startups on their fundraising. Sorry, as others have mentioned your business is unlikely to attract VC investment (service-based businesses are usually unattractive to VC's).
The first question I would ask is, if an investor were to give you all the capital you asked for, what would you do with it?
If it's for purchasing equipment, perhaps you could get favourable vendor financing. If it's hiring employees there could be a government granting program that you qualify for (I know this exists in Canada for hiring young employees).
An old boss used to say 'equity is like toothpaste, once it's out it's really hard to get back in.' So with any investor take a hard look at why you need the money in the first place and if there are non-dilutive options you can pursue first to accomplish the same goal.
I hope this helps!
I help companies find their most profitable customers working with everyone from pure B2B startups to $75M+ consumer businesses. First, I would separate whether you are solving a problem for a consumer or a business (they have very different ways of being sold to).
To build on what Daniel is saying, I would begin with meeting as many people as possible you think you solve a problem for. At first, ask them what's bugging them about the area of their business or lives your idea pertains to. Is what they currently do too slow, too complicated, too expensive? Shoot for talking to a couple dozen people. Clarity and your friend group are a great place to start these conversations.
As you have these conversations you'll start to see patterns emerge. Holes in what's currently being offered in the marketplace, etc. From there you can start narrowing the conversations. After they've discussed what they don't like about what's currently out there you can pitch your idea. "Hey, listen it sounds like you really hate changing your summer tires to winters. What if I could have a team come to your home, change them and store the summer tires for you all for $49.99?" And the last bit is the most important part, asking for the sale. People will throw out objections: "Too expensive." "Nah, it's actually not that important. I'll change them myself." Or they'll say "yes" which gets some $ in the door. That's when you can start doing the traditional business planning of determining market size, etc.
I hope that helps!
I would suggest the first question to ask is "what problem do I solve?" And of those people I solve problems for "who do I create the most value for?" In the non-profit world you need to add "How does my business help the non-profit run better and/or help the group the non-profit focuses on?"
For example, if you've created a platform that drives donations, your company "has created a platform that helps you reach fundraising goals faster."
What you don't want to do is market and sell to B2B and B2C audiences simultaneously. They have different ways of buying - a B2B audience needs to have their benefits quantified (using your thing makes me x amount more) - and it's extremely hard for a startup to be able to do both well. Better to start with one, execute really well and move into the other.
Feel free to give me a call and we can dig into who your most valuable audience is.
First off, sounds like a great product. I have a family member with diabetes and this is something they could have used years ago.
I worked with Tom Nagle who wrote the bible on b2b pricing and he taught me to always think about the immediate problem you're solving for your customer and what value that delivers.
In your case that could mean your app increases attendance at diabetes info sessions because patients are having more fun. Or decreases missed appointments (which had an easy to calculate cost) because that functionality is built into your fun app. You need to figure out what's the immediate pain your relieving for the healthcare provider and sell on that, not long-term potential cost savings.
Happy to brainstorm and share some
techniques on zeroing in on how you solve an immediate problem.
For many it was Bill "Coach" Campbell of Inuit: http://en.m.wikipedia.org/wiki/William_Campbell_(business_executive)
Also check out Ben Horowitz's "The Hard Thing About Hard Things" for more on Bill.
I help b2b companies in finding their most profitable customers and have worked with several companies creating marketplace business models. If I was in your shoes I'd:
- Sell, sell, sell. Even if you're manually connecting buyers with sellers at first. Ensure what you're offering is a genuine need. People hate change (not a bad thing) so you have to offer them something that is leagues ahead of what they already use. Meaning it's a lot faster, cheaper, easier and funner then what they already do. Talking to potential customers is the easiest way I've found of figuring out where the pain/problem is and how you can address it.
- Ensure your market is specific, but big enough. Who are your customers and how many of them are there? At first you need to target a segment of the yacht/boating industry, own it and get people raving about you. Then you can move into bigger/adjacent categories. This proves traction and revenue and shows investors where you can grow into.
Feel free to call me if you'd like some more specific advice for your situation and stage of growth.