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Sweet marketing music

Tanner Montague came to town from Seattle having never owned his own music venue before. He’s a musician himself, so he has a pretty good sense of good music, but he also wandered into a crowded music scene filled with concert venues large and small.But the owner of Green Room thinks he found a void in the market. It’s lacking, he says, in places serving between 200 and 500 people, a sweet spot he thinks could be a draw for both some national acts not quite big enough yet for arena gigs and local acts looking for a launching pad.“I felt that size would do well in the city to offer more options,” he says. “My goal was to A, bring another option for national acts but then, B, have a great spot for local bands to start.”Right or wrong, something seems to be working, he says. He’s got a full calendar of concerts booked out several months. How did he, as a newcomer to the market in an industry filled with competition, get the attention of the local concertgoer?

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by Kara Lazarus
March 2008

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Steps to prepare for starting a business

My vision did not immediately become a reality as I accepted positions with large corporations after both college and business school. I revived the dream after a decade working for these organizations with somewhat oppressive managers.

Those 10 years were actually good preparation for being an entrepreneur. Here are the points you should consider, while working for someone else, to improve your odds of success for running your own business.

1. Build your network.

First and foremost, develop your network of acquaintances and friends. A network is the lifeblood of any successful small business. Discipline is important to maintaining these contacts.

Maintaining relationships takes effort, but it actually can be quite fun staying in touch with interesting people. Block off a half-hour on your calendar every week to work on this activity. Examples include sending an e-mail, placing a phone call or getting together over coffee.

Staying in touch with your network every few months will go a long way when you are ready to branch out on your own. There will be a time when you need advice or a referral and by maintaining relationships your contacts will be willing to help.

There are tools to help you manage your network. The networking site LinkedIn (www.linkedin.com) is quite popular. This Web site, a kind of Facebook for adults, is an efficient way to connect with past colleagues, classmates and friends. You can stay in touch through job changes and, especially for women, name changes.

2. Find the right mentor.

Having a mentor can be a tremendous benefit when you start a business. Spend time to find the right person and consider going outside of your current company to forge a partnership. Undergraduate, graduate school and fraternal organization alumni networks are great places to start.

My mentor is in a completely different industry which gives me an alternative perspective and, with no office politics, makes her a true confidante. She proved to be a valuable resource during the planning stage of my company because I could be completely upfront with my intentions.

3. Write a business plan, even if it is not required.

A business plan is essential when you need a loan or if you are looking for investors. However, a business plan makes sense for anyone starting their own business. It will help you think through your most basic ideas and vet the business model as a viable opportunity.

A business plan is also helpful in gathering feedback. My plan became a tool to help my spouse understand that I was serious about launching a business.

Laying out my intentions in black and white allowed our family to take emotion out of the evaluation. As time goes by, the plan can keep you true to your original vision and help you create goals. The Web site www.bplans.com has many examples.

4. Get your finances in order.

I do not profess to be a financial maven (and my financial planner will concur). My approach is financially conservative. It was important for me to pay off my business school loans within four years.

This financial freedom was critical in allowing me to start my own business. It is wise to remove yourself from the burden of credit card debt, car loans or an educational loan payment. Any way to alleviate debt in the start-up phase will decrease the stress to instantly start making money.

It is also beneficial to establish a relationship with an individual at your bank branch. In the future, the banker will facilitate setting up separate accounts for your business. It is helpful to run your business plan by a trustworthy banker to gather ideas for the financial structure of your company. Because your banker will be working with other small-business owners, your network will expand. This helps you stay connected to important resources.

5. Set realistic financial goals.

Remember the adage it will take twice as long and cost twice as much? You can expect that reality when starting a business. Unexpected start-up expenses will occur.

Technology is one area of a new business where costs add up quickly. That can be compounded by a lag in payments from your customers. It can seem like eternity from when you complete the work until you receive payment.

Making realistic assumptions on revenue and expenses helps you meet your goals. Reaching these short-term goals in the start-up phase can be important psychologically.

Before you start your business, understand what to charge your clients. Start by figuring out your true current compensation beyond your base salary and bonus. Add benefits such as health and life insurance, stock options, paid time off, and even maternity or paternity leave. If you want to maintain your current lifestyle, determine if you can bill enough to make up for your lost income.

6. Expand your knowledge.

When you start a business you often must become a jack-of-all-trades. Taking on unfamiliar projects develops your expertise in other functional areas.

What can you do before you launch your business to expand your knowledge? Your current workplace may offer opportunities to take on a cross-functional role. Additionally, there may be small projects where you can shadow a colleague in an effort to learn about a new function. There are almost always nonprofit volunteer projects where you can learn new skills.

Starting a business can be a daunting task, but there are ways you can alleviate some of that trepidation through taking simple steps. Focusing on these six concepts before  launching your business can help you realize your entrepreneurial dream.