Talent, Talent, TALENT!

Written by John Sharpe, President, Southeastern Technology Consultants and its affiliated divisions

Southeastern Technology Consultants is a division of StaffSource LLC, added in 2011 due to the high demand for IT professionals. Its President, John Sharpe, is originally from Knoxville and founded his first business, ARG Financial Staffing, in 2004. He is involved in multiple community organizations as well as the East Tennessee chapter of the Young Entrepreneur’s organization. He is President of ARG Executive Search and ARG Financial Staffing, StaffSource Employee Solutions and Southeastern Technology Consultants.

Sharpe is scheduled to participate in a Fireside Chat at Startup Day 2014.

Business is a combination of people, process and product or service, but your most important assets are the people you hire.

People are extremely important because they are responsible for architecting the process and conceptual creation of the product/service. The quality of the decision-making fuels the business.

Furthermore, each individual has their own strengths; for example, one person will be the seller while the other is the designer of the product/service, or another has a deep understanding of the financial concepts and economic models. Knowing who to hire and where to place potential employees to emphasize their strengths is key in developing your startup. You are looking for the best team possible that will help your startup grow rapidly.

A smart collective team approach is required. We have used a collaborative method in our company for the decision-making process, which has helped identify strengths and weaknesses that might have been overlooked. For a startup, collaboration is key. In order to grow and develop a business, changes are inevitable. Having a strong team that can face changes and find effective solutions quickly is the key to growth and success.

Hiring talent cannot be determined by following a checklist, but below are tips/qualities that I believe can help identify the most qualified potential hires for your startup.

  • Search for candidates with certain strengths that are currently missing or that can help your company and benefit the potential employee in future growth.
  • Culture is a big factor in organizations – make certain they are a fit for the already established culture in your company.
  • Search for candidates that know how to work through problems and can or have dealt with change; as a startup, there are many hats to wear, being able to balance it all is not an easy task.
  • Communication skills are essential.
  • Find team players.

View John Sharpe’s LinkedIn profile here.

John Sharpe

John Sharpe

Mark Cuban thinks I am a moron

By Jonathan Patrick, Senior Vice President/Chief Lending Officer of the UT Federal Credit Union

There is a video flying around the internet where Mark Cuban is quoted as saying that “If you are starting a business and you take out a loan, you are a moron.” Apparently, I am one of those morons. Cuban’s comments revolve around his belief that there is so much uncertainty in a startup, and that the banks don’t care about your business, so getting a loan to get started creates conflict.

Well, Mark, you are right. Most banks don’t care about your business. In fact, most won’t even bother talking to a startup. Which is exactly why UT Federal Credit Union launched the Line12 business micro-loan program. You see, as a credit union, it is in our DNA to impact our community and our members. So, if the only way a member can bring their startup to life and fulfill their dream of owning a business involves a loan, then you can count us in.

Rest assured it’s not about the revenue to our credit union. In fact, we probably have more expense associated with that loan than we do income. And yes, we know that we are “saddling” a startup with debt. That’s why we provide more than just capital in the form of additional resources to help them increase their chance for success. It’s easy to say as a lender, but there is such a thing as “better” debt to have. I’d much rather a member borrow five, ten, or twenty thousand dollars to start a business than on eating out and shopping.

So, is a loan for a startup right for everyone? Absolutely not. In fact, UT Federal Credit Union goes to great lengths to vet out our applicants and only take those who we feel can afford the debt without relying too much on expected business income. We also rely on our committee of outside experts to tell us which startups they feel have the best chances of succeeding. Unfortunately, we have to tell far more applicants “no” than we do “yes.”

Cuban does point out that there are plenty of ways to start businesses inexpensively through hard effort rather than capital. I couldn’t agree more. In fact, I’ve started businesses for a few hundred dollars that have brought me thousands of dollars in return. But there are times when the right idea takes capital to scale. That’s when UT Federal Credit Union is there.

View Jonathan Patrick’s LinkedIn profile at https://www.linkedin.com/in/jonathanmillspatrick.

Jonathan Patrick

Jonathan Patrick

Four tips for securing financing

By Charlie Brock, CEO, Launch Tennessee

Securing financing is a journey that takes months, sometimes even years, for many entrepreneurs. It requires a mix of humility, perseverance and skill. I’ve worked on both sides of the table – as an entrepreneur seeking financing and as an investor evaluating equity opportunities. Here are some tips for success.

  1. Be prepared. Many investors consider 100 or more opportunities for every investment they make. They’re busy people, so be ready to answer their questions and provide the information they need to make a decision. There is some information you can assume nearly all investors will want, such as an understanding of the market, a competitive analysis, your go-to-market strategy, financial projections and details about your management team. While all of this may be addressed in your executive summary (1-2 pages max) and your pitch deck (8-15 slides), you should be able to discuss them without referring to your written information.
  2. Be confident, not cocky. As an entrepreneur, you appropriately have a sense of pride in your company. Passion and confidence are important attributes for a successful entrepreneur, but make sure these do not manifest themselves as arrogance, which will be interpreted that you are un-coachable. This designation, whether fair or not, will ruin your chances with potential investors – it is also a turn-off to prospective employees and customers.
  3. Be thick-skinned. Most entrepreneurs hear “no” significantly more than “yes” when they are seeking early-stage capital. Don’t take it personal, that’s just the nature of the beast. As noted above, investors have many options in terms of companies to invest in. They are trying to achieve the maximum return for themselves and their limited partners and depending upon where they are in their fund cycle, it’s possible that all of their remaining funds are being reserved for follow-on funding from their previous investments. As an entrepreneur, you have to take “nos” in stride and consider that each “no” gets you that much closer to the right investor who is going to say “yes.”
  4. Be wary. All investors are not created equal. Just as they are going to conduct due diligence on you and your company, you need to do the same with them. Don’t be afraid to ask them for references from their prior investments. If they are offended by this request, your diligence is now complete – thank them for their time and move on to the next funding prospect. The worst scenario for an entrepreneur is to get into a business relationship with a lousy investment partner. Not only will they make life miserable for you and distract you from building your company, but they will also keep other potential investors from getting in the deal.

Navigating the investor landscape is a complicated process. The longer you can bootstrap the business and show traction for your new company, the better your chances of securing investment capital from solid partners seeking a win/win relationship. It’s a good time in Tennessee for entrepreneurs in that there are more early-stage capital sources within the state in addition to the increased interest being attracted from out-of-state investors. We need to continue to build these capital sources to support entrepreneurs who are creating jobs and bringing transformation to their companies, the communities in which they operate and the state.

Charlie Brock is CEO of Launch Tennessee (www.launchtn.org), a public-private partnership focused on supporting the development of high-growth companies in Tennessee with the ultimate goal of making Tennessee the No. 1 place in the Southeast for entrepreneurs to start and grow a company.

Charlie Brock

Charlie Brock

I hope you are in the 43%, not the 70%

By Jonathan Patrick, Senior Vice President/Chief Lending Officer of the UT Federal Credit Union

It’s your baby, your dream. It’s something you have thought about throughout your professional career. I know the feeling myself. The exhilaration that comes with creating and then launching your own venture. I also know how quickly your dream can become a nightmare.

According to a recent study, 43% of Americans polled said they wanted to start their own business. The problem is that only about 1% of those people are willing to put in the work it takes to launch, let alone scale, a new business. There are plenty of reasons this happens. The fun wears off once the creation phase is over and the “real work” begins. Or the hobby-turned-business quickly loses its luster. Maybe you don’t have the right resources at your disposal in the first place.

Of the reported 70% of small businesses that end up failing, I would argue that a large majority do so because they don’t have access to the right resources that can help propel them forward. In particular, they don’t have access to capital and qualified advisors who have “been there, done that.” With those challenges in mind, UT Federal Credit Union set out to develop a business micro fund that not only provides startups access to capital, but also to other professionals that could provide insight into some of the typically challenging topics for a new business. Topics like accounting, business plans and strategy, and intellectual property law.

The Line12 micro fund launched in March of 2014, and I am proud to say that it has already provided capital to numerous startups for aid in expansion. Our participants have benefited in other ways, including introduction to angel investors that lead to additional funding offers. One applicant has even made it onto ABC’s Shark Tank and recorded that session in September. In fact, the Line12 program itself is a startup program that is currently being beta tested by other credit unions around the United States, including Silicon Valley.

At UTFCU we put our money where our mouth is when it comes to entrepreneurship. We have sponsored numerous pitch competitions around Tennessee and have been named the top SBA lending Credit Union in all of Tennessee for three years running. That’s because it’s our dream to help you accomplish your dreams.

For more information on our business lending offerings, visit utfcu.org or line12fund.com.

View Jonathan Patrick’s LinkedIn profile at https://www.linkedin.com/in/jonathanmillspatrick.

Jonathan Patrick

Jonathan Patrick