In this Economy, It Sucks to be Small

Recently, Bank of America (BofA) announced plans to lay off 3,500 workers and perhaps as many as 10,000 over the coming months. While I feel very bad for the newly unemployed BofA workers, it is hard to feel any sympathy for BofA as an institution. BofA received taxpayer-funded bailouts totaling $45B in TARP funds and $118B in loan guarantees. BofA was heavily exposed during the mortgage crisis due to its own bad loans and those that it acquired from Countrywide Financial & Merrill Lynch. According to those who make such decisions, BofA was too big to fail.

Being an Entrepreneur is Hard (or is it?)

I recently met a friend for lunch who is interested in launching a new technology business. He is finishing up his MBA and works as a middle manager in a medium-size division of a large company. He is itching to try out his new-found business and management skills within a startup environment. He plans to partner with a technologist who has been part of a successful startup. His would-be partner helped launch a company that grew to $12 million revenue in 3 short years and achieved liquidity through acquisition. My friend plans to work nights and weekends to get their new company launched and then quit his day job when the company achieves some level of cash flow through revenues or government grants.

Marketing: Value or Pain?

Every time I discuss our value proposition with a serial entrepreneur friend of mine, he stops me to ask "where is the pain?" And, he is absolutely correct. His point is that alleviating customer pain is a much more effective strategy than just offering value. Think about it. You will act immediately to avoid pain, but may put off something that adds value. Value can be a nice-to-have whereas relieving pain in an immediate need-to-have. Pain will absolutely cause customers to buy your products or services.