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Guiding Light

Feeling a little lost at the helm of your business? Don't worry: A peer group can help you find your way out of the darkness.
August 1, 2003
URL: http://www.entrepreneur.com/article/63246

It is a Thursday morning, and normally, Cynthia Malcom would be tending to her business. But today, she's sitting in a classroom, listening to a lecture with a handful of other adults.

Actually, she is tending to her business. It just doesn't look like it at first glance. Malcom is attending BYOB, and no, it's not what you think. This is Build Your Own Business, a 10-week program for anybody who wants to run a company. Situated in a spacious but almost barren room on the second floor of the Cincinnati Business Incubator, BYOB targets residents in underserved, urban neighborhoods. Malcom and her classmates are paying $50 for 20 hours of instruction from a seasoned entrepreneur; after the class is over, they can receive ongoing free services, like financial counseling and tax preparation from BYOB's nonprofit organization, Smart Money Community Services in Cincinnati.

But Malcom has already mastered one important lesson in starting a business, one that entrepreneurs new to the scene would do well to learn: You are not alone. No matter how bleak things might seem, there are always people willing to aid and comfort a struggling entrepreneur.

Malcom, who's in her 30s, runs the Hand Candy Mind and Body Escape in Cheviot, an urban neighborhood in Cincinnati. She has one part-time employee and more than 100 regular customers. Hers isn't exactly a multimillion-dollar business, but she wants it to be. She's come a long way since launching her salon with little more than $5,000 after working several years at a casino. Having dreamed of being an entrepreneur since she was 12 years old, Malcom opened her business in 2000, and she hopes to open her second store within a couple of years. But to do that, a little advice and inspiration wouldn't hurt. "I'm the owner, manager, secretary and janitor. You get so busy, you forget the basics," explains Malcom, who hopes the education will help fill some gaps in her knowledge.

Coming to BYOB was a smart decision. As any entrepreneur knows, if you have a problem, you fix it. You might be flying solo, but there are always air traffic controllers in the tower, ready to talk to you, ready to help. Going it completely alone is unnecessary-maybe even foolish. And Malcom would rather soar than crash.

Help for Everybody
Across the Ohio River from Malcom is Nicole Christian, the vice president of development for the Northern Kentucky Chamber of Commerce. "What we do is point people in the right direction," says Christian, espousing a philosophy of chambers of commerce nationwide.

Even if you have only the foggiest notion of what your business is going to be, Christian-or somebody like her-can help. She directs people with a business idea to the nearest Small Business Development Center, which helps novice entrepreneurs formulate blueprints for their businesses. And SBDCs are everywhere. Even if you live in American Samoa, you're in luck.

If you have at least a vague idea of what your business plan is, chamber executives like Christian can make finding financing and deciding on a business location less overwhelming. As you're writing that business plan, "we have a business panel review," Christian says. "It's a revolving panel of about 10 people, and they can ask questions that will help you realize if there are holes in your plan."

And, of course, a chamber of commerce or an SBDC can steer you to other organizations such as SCORE (Service Corps of Retired Executives). Located nationwide, these retired executives want to help budding young entrepreneurs; the SCORE Web site even offers free e-mail counseling. You can seek these groups on your own, of course, but the chamber of commerce and SBDCs are often already working with groups like SCORE and may introduce you to their local contacts a little faster.

Help From Your Peers

But what you really want is somebody in the trenches with you, right? There are plenty of peers who are willing to share their wisdom and introduce you to important players in your industry.

Not to beat a dead horse, but the chamber or an SBDC could tell you what's out there locally. Or just search the Web, where groups abound, like TechExecs, a Houston-based peer network group for entrepreneurs, execs and investors in early-stage tech companies; and the Community Development Corporation of Long Island, which offers numerous programs to low-income entrepreneurs, including seminars on finding capital. Also, see if your industry has a trade organization that might help you.

Start-Up Help

Just starting out? Read Cool Aid for 10 places to find free start-up help.

No matter how niche-oriented your business is, you might be surprised by what's out there. For instance, the Fabless Semiconductor Association in Dallas provides a networking group for fabless semiconductor companies and their suppliers-with an emphasis on helping start-ups. Its venture capital advisory board offers details on practices and trends; its "Know Network" answers members' questions about the industry.

"If I'd known how helpful networking groups are, I would have started my business earlier," says Ron Dresner, 40-year-old CEO and president of Your PR Department LLC in Farmington, Connecticut. After a lengthy career in mostly radio, Dresner began his business in 2000 with $25,000. Today, his company is doing well enough to support three employees. The first place Dresner turned to for advice was his chamber of commerce. After that, he approached almost every group he could find-which is how he found NEXT Business, a nonprofit in Glastonburg, Connecticut, that helps its members get to the next level. Only entrepreneurs are allowed in. And you do have to apply or be invited, but membership is free. Dresner was invited into the group through a contact he made at another networking function. He says he leaves each meeting with about 15 new business cards-and often, that leads to a new client.

Help From the Academics
You could go back to school for free help. There are 140 active Small Business Institutes located at universities nationwide, says Bruce Kemelgor, director of the Small Business Institute at the University of Louisville in Kentucky.

Every year, the Small Business Institutes help entrepreneurs for weeks at a time, often daily-and for free. "These are [entrepreneurs] who are struggling to get going beyond that first year," says Kemelgor. "We go out and work alongside [the entrepreneurs], like conducting market and research studies. We'll do accounting, financial and collection problems, cash-flow problems-and we don't just do one thing. We usually try to address two to three needs the client has."

But there is one caveat-and this is the guiding principle at every Small Business Institute, says Kemelgor. The entrepreneur must "have genuine problems that could be resolved with the expertise of the students and myself. I get requests from entrepreneurs who are lazy or don't have enough time," he says. "They'll ask 'Would you write a business plan for me? I can't get around to it.'" Well, neither can Kemelgor. He wants to help start-ups, but he wants his students to benefit, too. So if you have a genuine need for some added brainpower that can fix a thorny problem, then a Small Business Institute is the place to go.

Group Effort

"Isolation is probably the most common problem of every entrepreneur," says Larry Kesslin, president of Let's Talk Business Networks, a New York City peer group. Membership costs between $3,000 and $5,000 per year--but their services are extensive. If all you can afford is pizza every Friday night with like-minded entrepreneurs, here are tips for forming a peer group:

  • How many should join? "Between eight and 12 people works best," Kesslin recommends. "If a few can't make it one week, there's still a minimum number that can keep the group going. And you're never going to love everybody, [but] you need to have buddies. There's going to be at least one person you like, and that's important."
  • Who can join? Kesslin advises they have at least the same experience and revenues as you, and preferably be further along. "You want to be the smallest fish in a group with different skill sets," he says. If everyone has the same opinions and ideas, then you're not going to learn much from each other.
  • What should our objective be? "Everything will be personal," says Kesslin. "You might want to get rid of isolation [or] create strategies." Just make sure you're able to learn and grow from the group.
  • How long should the meetings be? "I've conducted meetings that have run two to three hours," says Kesslin. "But the most important thing is doing them regularly. At minimum, you should meet quarterly."
  • What should dues be? "It's up to each individual," explains Kesslin. "I've seen groups work where they don't charge anything. And I've seen them not work where they're charging 10 grand. Money isn't the issue."

Do-It-Yourself Help

If nobody seems to offer the support you need, then you might have to create your own support group. That's what John Friess and some like-minded entrepreneurs did. Similar to NEXT Business, but in Portland, Oregon, Starve Ups is what it sounds like: a shelter in the storm for start-ups.

Starve Ups came about because Friess, 27, is the vice president and co-founder of Wired.MD, a company that produces interactive educational videos for hospitals and health-care organizations to show to their patients. Wired.MD opened in 2000, though its product has been in the market for only about a year. Friess' company has 15 employees; clients consist of 88 health-care organizations in 29 states.

Open Your Mind . . .

And let a business mentor fill it with their knowledge. Read Learn From the Best for more info.

During the start-up stage, he and his brother and co-founder, Mark Friess, 30, attended every entrepreneurial meeting they could find-with disappointing results. "What we found," recalls John, "was that at the end of [the meetings], we'd meet other [attendees] in the parking lot. We were finding that the most valuable component of the meeting was that 20 minutes afterward, talking in the parking lot."

And so John, Mark and 25-year-old Paul Anthony, CEO of Rumblefish, a Portland, Oregon, record label and publisher, formed Starve Ups, a peer group that simulates those parking-lot conversations. "We have an extremely strong peer network-we can call each other anytime and ask any question," says John. "We've got the ability to utilize other companies' resources, and we've gotten some great leads."

It's a tight group with 18 companies-and 92 businesses are on a waiting list to get in. Entrepreneurs in the Portland, Oregon, area may not be able to join the group anytime soon, but who knows? As John says, "Those who are passionate and aggressive usually get what they want."

If you live elsewhere, you could start your own Starve Ups chapter, which John wants to see happen. Just call him-if you're serious, he'll help you get started. Or begin a peer entrepreneurial organization of your own. In any case, Starve Ups' peer counseling seems to have benefited its members. "At our first meeting, seven young companies showed up," says John. "Two years later, they're still in the group."

This sounds great, but doesn't starting a nonprofit entrepreneurial peer group take time away from running your soon-to-be thriving enterprise? And at a time when every ounce of your energy should be focused on building your business?

Definitely, agrees John, "But at the same time, it brings so much back. You get organizational skills, leadership [skills] and opportunities like this interview. And we're building relationships with like-minded peers, relationships I believe we will have for many, many years."

It's Still Up to You
But don't overindulge, advises John. "A lot of times, networking is not working. You just sit around and talk. Once you meet [someone who can connect you to an opportunity], try to keep it to one to three networking groups."

"Time is valuable, so I choose the event," agrees Dresner.

Being puzzled, worried, frazzled and even frantic is part of being in business. So is asking for advice. Keep that in mind, and things will be decidedly different in the future. The next generation of entrepreneurs will have somebody else to turn to for help: you.

Need More Help?
  • Axxess Business Centers: These for-profit centers provide advice and help from veteran entrepreneurs on all aspects of starting and running a business.
  • Bizymoms.com: If you're a mom with a business, here's your support group.
  • Launching Entrepreneurial Advisory Panels: This University of Wisconsin, Madison, School of Business group helps women entrepreneurs.
  • Northwest Entrepreneur Network: Located in Bellevue, Washington, this program aims to help regional entrepreneurs succeed through mentoring and networking.
  • SBA: Visit this site for business resources and information on special programs.

Geoff Williams is a freelance journalist in Loveland, Ohio. He says people are always telling him he should seek help.