Wed, 05/13/2009 - 00:31 — Susan Starting a business can be daunting and scary, but also very exciting and empowering. Being a small business owner, I attend many networking events and meet many other small and medium-sized business owners of all different “levels.” I often encounter others trying to “cold call me in person” by pitching me services I don’t need, people who aren’t that serious about starting their own business and trying to get my firm to do design work for them for free (or what I like to call a “percentage of nothing”) or worse yet business advisors and coaches that I wouldn’t trust to coach or advise my cat. I sometimes even run across the the latter two characteristics paired together in one person at these events. It’s painful to watch, kind of like a slow-motion train wreck. I don’t think that enough people who attempt to be “entrepreneurs” ask themselves the right questions, underestimate what’s involved or are honest with themselves; And hence, wind up spinning their wheels and wasting time, money and energy. But say you are a serious and committed entrepreneur and not just calling yourself one because it sounds good or it’s be default since you just got fired from the tenth job in a row; Finding a good coach or a mentor is key to successfully transitioning out of being an employee and into running a successful, profitable enterprise. There are many charlatans parading around as life coaches, business coaches, advisers, consultants, sales trainers, seal trainers, elephant trainers, etc., and they will give you little else than the illusion of value. Worst case scenario, you will wind up with someone who actually does damage to your business, as I once witnessed years ago at a staff job where the business adviser was a fraud and his credentials were false. Choosing someone to help you get to the next level in your personal and/or professional life can be daunting. Today, we are talking with Larry Sharpe, my sales and business coach, and a generally all-around wise individual. Larry is the Director of Neo-sage, Inc., an influence consultancy in NYC, Board Member of the Association for Corporate Growth (ACG), Area Director of Business Networking International (BNI), Guest Instructor at Columbia University’s Graduate School of Business and the Fashion Institute of Technology, and the host of the Ivory Tower Radio Program. Today, we will get to pick his brain about what makes for a good entrepreneur and, if you happen to qualify as such, how to choose a good coach/adviser.

Q: What makes a good entrepreneur? What qualities or what type of person should take a shot at running their own business?

A: The problem with most entrepreneurs is that most are mistaken entrepreneurs, in other words, they don’t want to become entrepreneurs. A lot of people take up the entrepreneur mantle, because they’re out of a job or because they are unhappy with a job or because they don't want to work for someone. These aren’t bad reasons to become entrepreneurs necessarily, but they often mean you don’t have the right personality. Meaning that, you really don’t want to be an entrepreneur; what you want to be is to be a contract employee. And there’s a difference. People will say well you know what, I work for companies and I’m an entrepreneur. Well if what you do is work for three months in a contract, you’re not an entrepreneur, you’re still a contract employee. Here’s the difference: the mindset. If you are in an employee mindset, that means you think the company has all the answers, and the company is going to tell you what to do. The company gives you instructions and you carry out those instructions and complete those instructions and then you've done your job, give me my paycheck, and I go my way. The idea of actually building value isn’t that important, the idea of really giving advisory services really isn’t that important. The idea is that I was there, did my time and got paid. Lots of people do that — nothing wrong with that — they’re great, but those are not entrepreneurs. Your mindset should be: I know that I’m good enough, valuable, so I have to bring value to the company. I look at the company that I’m working for as a client and I look at them as an equal almost, meaning they’re good in their world and I’m good in mine. And they’re hiring me not just to do a job, but to bring my expertise, and to bring my value to them. So, when they say what we need is X, Y, and Z, I may actually say NO you don’t need X, Y, and Z. You think you want X, Y, and Z, that’s OK, but let me show you how you’re gonna get what you really want. And here’s where my expertise comes into play. When you're able to show your expertise and you think that way, generally speaking you have a better chance of being an entrepreneur. If you are just hoping that large company ABC is going to give you a job, then you probably should go work for someone, or just realize you’re not an entrepreneur, and just be a contract employee.

Q: Besides being able to think two steps beyond what’s right in front of your nose, are there any other qualities? What would be second place?

A: Well, that’s a great question. The second thing you have to worry about is not just your attitude, your mindset, but it’s to realize that once you become an entrepreneur, your skill set by itself is no longer the most important thing. Contract worker or employee, either of those two, your skill set is the most important thing. You’re being hired for your skill set. Once you become an entrepreneur your skill set is no longer critical. You’re not judged by if you're a good consultant or if you are a good graphic designer or if you are a good you-name-it, you are judged by your business acumen. That is what will make you successful. There are a whole lot of people who are good doers, who will fail as entrepreneurs, because they think that being good at what they do is what makes you a great entrepreneur. False. You can hire other people to do what you do. You have to be able to do what you do well, plus market, plus sell, plus organize, plus do finances, and plus make sure your business is smoothly running every single day, every single month. That may have nothing to do with being a contractor, with being a graphic designer, with being a anything. So understanding that your skill set is no longer the most important aspect. It is the second critical piece.

Q: What would be next in line after that then?

A: The third piece would be realizing that you are going to have to spend money. On everything. You’re gonna have to spend money. And you’re probably gonna have to go into debt. Most businesses go into debt. Most businesses run in big debt. They carry debt as part of the normal business model. And that’s OK. You’re going to have some kind of debt and spend money. If you’re not prepared to spend money, then you are not prepared to be an entrepreneur. What does that mean? The reason why you’re gonna have to spend some money is you’re gonna have to hire experts around you to do those other things we talked about. You can hire people to do that. Not just that, but you have to buy things like marketing, clothing, uniforms, professional space, new computers, who knows or spending money to create a good website, whatever the case may be, you have to spend money. Now if you don’t realize that, you’re gonna do what most people do is and that’s go in with not enough money. You mentioned earlier that so many businesses fail for many reasons. That’s not true. The vast majority of businesses fail for one reason and one reason only: they run out of money. That’s why they fail. Some fail because their principals die, get injured, things happens, but the vast majority of entrepreneurs who fail, don’t fail because they literally die or get sick or something like that, the vast majority fail because they run out of money. So if you’re not prepared to spend money, and if you don’t have that kind of money either prepared in the bank or available in credit, don’t become an entrepreneur.

Q: Do you think that when people are unwilling to spend money that... do you think that’s really just a lack of commitment? Like when somebody isn’t really willing to go into debt, and their attitude is “well I’ll spend money when I see this business make some money first?”

A: What happens is they still have the employee mindset. The employee mindset tells them “well its the company’s job to spend the money not mine, I’m still an employee. I don’t spend money on myself, the company does.” The problem is that, to them their client is their company, not their client. They think the client should spend money on them, they should show me how to do stuff, they should give this to me. I don't have to spend the money, they should, because they're still thinking of themselves as the employee, even though they aren’t. When you finally break the employee mindset, you’ll start spending money.

Q: When you’re choosing a business advisor, coach, sales trainer, etc. someone to help you make that transition, to get to the next level. Like I said there’s a lot of charlatans out there, snake oil salesmen, and women, what are some questions you should ask to suss out the wheat from the chaff? What are some red flags you should look out for and why?

A: There’s a lot of things to look for. The number one thing to realize when you’re hiring any adviser is to look at who their client base is. This is a critical piece. Who is their client base? Is their client base people who have the money, or is their client base people who are still failing, or is their client base people who are successful and succeeding? Are their clients succeeding at whatever it is that you are trying to achieve? If their client base is full of people who are desperate or not doing well that's a flag that the consultant or advisor is probably not that good. That's not a 100% but probably not that good. So look at not how successful the actual adviser is, look at how successful their client base is.

Q: So it would be kind of like looking at a designer’s portfolio to see past results?

A: In a way yes, but you need to look for the right reason. In other words when I look at a designer’s portfolio, I should not be looking for attractiveness. I should look at the designer’s portfolio and I say who has selected this designer, who agreed to these pieces of work, and did they deliver the result the client wanted? That’s what I’m worried about. Lots of people can draw well in the graphic design world, doesn’t mean they’re effective. And if I’m not a graphic designer myself, just because I think something looks good, doesn't mean it’s right. Doesn't mean it’ll work. So if I stick with something that looks good, I may fail. So again I’m saying, are the clients successful in what they're trying to achieve? If the clients are successful in what they’re trying to achieve, generally speaking you’ve got a good adviser.

Q: So basically always go to the end results.

A: Yes, always. Because in the long run that’s what they're looking for. Everything else is a means. The next thing I would look at is actually how well does that adviser knows your world, not their world. What does that mean? They need to understand how your industry/field works. The ins-outs, seasonality, common concerns, etc...

Q: But don’t you think that somebody who is really smart and really insightful... that there’s similarities between being an adviser for this field versus that field? That someone really bright and insightful could troubleshoot anything?

A: Yes, let me be very clear about it. If you can see obvious similarities and lots of success, that’s the very valuable. If someone’s clients have a lot of success no matter what field they’re in or working in, the odds are they’ll have success with you, so again, the success piece is important.

Q: How we work and what we do here at Fresh Trajectory is based on one of my strong beliefs is that a good designer can design any type of communication for any type of client, that you know what questions to ask, and you know what to latch onto to feature that and make the client shine. We believe in what rock star designer Massimo Vignelli once said, “specialization leads to stagnation.” The parameters, time lines and technical constraints will always be different from project to project and client to client, but you will always have parameters, time lines and technical constraints that you have to work within and respect; And constantly having to deal with different sets of these things makes you a better designer and problem solver. You don't think that that same concept applies to coaching and advising?

A: Sure, let me adjust my answer. A good vendor or consultant must know your SITUATION. Usually, that is industry or sector based, but doesn’t have to be. In other words if they understand that your website looks good, but it’s not converting and they’ve repaired this situation, then the actual industry may not be as critical. Do they understand that your communication has wonderful content, but no one is reading it? Do they get that? Has this happened to their clients in the past? Do they know what the common pitfalls are? Or are they just saying, “What do you think, what do you think, what do you think?” If they are just asking you what you think, you have a contract employee and are probably in trouble.

Q: Do you think there are just certain people who just aren’t capable of changing habits and processes that don’t work for them or their businesses? I mean what if you have someone like that in front of you looking for coaching or sales training and then they go out and fail? How is that the responsibility of the coach or adviser?

A: That’s another thing I was going to mention. Is the advisor or consultant prepared to guarantee some type of result? And that’s a hard one, because sometimes people don’t want to change. Very often a consultant will simply say something like this: “Look I gave that person the information, if they don't want to do the change, then how is that my fault?” Well, part of being an expert advisor or consultant is also being able to influence the people around you to actually make the moves. So it’s part of being a good advisor, it's part of being a good consultant. Just because I have all types of good information, if no one takes it, what difference does it make? So, if I’m going to be an advisor or consultant, I have to also be able to influence people around me to take my advice! I may have to realize that it could require more than just one medium; it might more time; it might be a combo. But with experience, I should have some idea. If the potential adviser or coach can't guarantee something, I’d be a little bit worried. Again, not that I wouldn’t take the consultant but they should have some type of personal pride in their work, and confidence that they can get the job done, so that they can guarantee something before you move forward.

Q: Larry, why do you think that there are so many charlatans in fields relating to consulting or coaching field? What do you think the appeal is and why do you think it attracts so many snake oil salesmen and women?

A: Because it’s so easy to do. Remember most people will select a consultant or advisor based upon how successful that consultant seems to be, not based upon the results of their clients. So, if you can seem smooth, and seem slick and sales-y, and seem like you're doing a good job, very often people will take you on. Also, if you're prepared to give people the "one day poof, I'm repaired" seminar you’re in business. This so rarely works, but people love it. Or give them “motivation” and people will believe that you are great, because they want a quick fix, and they'll pay you.

Q: Yeah, but that kind of goes to the illusion of success.

A: Yes, of course! People, as a general rule, if they have a choice of going the easy way or the hard way, generally go the easy way that’s a fact.

Q: So you're saying that people will choose the illusion of success over real success?

A: Almost always. And I’ll give you the perfect example. Two people: Tony Robbins and Joel Osteen. They are masters of the illusion of success. Masters. Profits are insanely high. People feel really good. People think they’re doing something to become successful. And almost no one is actually succeeding. And there are lots of business coaches, lots of personal coaches, lots of advisers, lots of people who simply make someone feel good, and they think they've done something.

Q: I call that the Advil mentality. You have a headache, you take a pill, it goes away. Do you think the whole culture is sucked in to that?

A: I would buy that, except that there’s one problem: generally speaking when you take the Advil pill, and the headache goes away, and usually it doesn’t come back. When it comes to the charlatans, the headache comes right back. In fact it’s supposed to, this way you can go back to them again and again. That’s the whole point.

Q: Maybe its not so much Advil, it's more like heroin.

A: Ah... there we go. I like that better.

Q: So its more like the heroin mentality. I stand corrected.

A: And you take it you feel great, it wears off and you go right back to them.
Q: And you crash?

A: Yup, you head right back to your dealer.

Q: And your dealer is the slick guy in the suit.

A: Or someone who makes it sound easy, someone who does a free tele-seminar. You’re not going to get clients galore with a free tele-seminar — you’re going to get pitched on something else! Which is OK, IF they didn’t promise that all you need is this one thing and you’ll be successful! There’s always one more product or service AND then you’ll be set!

Q: Do you think that people are (A) generally that stupid to believe that or (B), really know it isn’t true but just really want to believe it?

A: People are not stupid. That is a false premise. People are simply programmed to act certain ways, and they do. The vast majority of people, hope for the right answer, they hope for the easy solution. It’s just natural for us. We pray for good luck, right? “Hope springs eternal” right? So someone offers us an easy solution, of course, we gravitate towards it. That is in NO way stupid — that is just human nature. We just gravitate towards that.

Q: So you don’t think it is a lack of awareness?

A: I think there are people who are very aware, who still make mistakes, because they are human. Happens all the time. There’s a saying, that the definition of insanity is doing the exact same thing over and over again expecting different results. And people agree to it, and a lot of people say that constantly — and they are all wrong. That is not true. That is actually the definition of humanity. Remember two things that are true about humans: we are always hopeful, hope is eternal, right? So we always want to to hope. And second, we are hardwired not to change. Change for us is scary, even good change is scary. So we are hardwired to hope, and not to change. So that means doing the same thing again and again and hoping for a good reaction is actually the definition of HUMANITY, not insanity — it’s what we do. That's why we require people who can influence effectively, like good advisers, and good coaches, and good mentors — to shift you out of that into something different, so you can be successful. It’s one of the reasons why so few people are a success and where they want to be. Because they fall right back into patterns and hope for something new. What most coaches do is change your emotional state or thinking. That’s not enough. We must change behavior. That’s much harder.

Q: To create real change and create the results you want in a tangible, meaningful way, especially when it’s tackling something you’ve never done before, do you think a lot of people don’t have the discipline to do that?

A: Anyone can change. And here’s my proof. There have been specialists who have found ways to get people to stop doing drugs. If you can inspire the crack addict or heroin addict or smoker to stop, that means anyone can change. The question is, are they being influenced effectively to change. Most people are not changing because it’s a lot of work to influence someone to change. It takes a lot of time energy and effort and knowledge and skill to change someone, it’s really hard. So, most people can’t do it, not because they physically can’t, but because no one is around them to guide them effectively. Everyone can change.

Q: What do you find to be the most common mistake small business owners make when approaching sales? Marketing? Networking?

A: When it comes to sales, I think the most common mistake they make is acting like they’re employees, retaining that employee mindset and hoping that the client “gives” them the work. Versus, putting two “companies” together to work together, which is where their mindset should be, because then it’s not “will you give me the business?,” it’s “is this a match?” When it comes to marketing, it’s that they talk about themselves, instead of the client. The vast majority of marketing that fails is not really client-centered; it's actually company-centered. Nobody cares what you do, they care what they get. When it comes to networking, the biggest problem is, people think networking is hunting, well it’s not hunting, it’s farming. If you want to hunt, you cold call. If you want to farm, you network.