Last week’s Main Street Forum (NYC) focused on the challenges small business owners face in growing and running their businesses. The resounding themes of the forum were – what is the definition of a small business and how can companies selling small business services make running a small business easier.
The Main Street Forum, hosted by Infusionsoft, brought together executives from companies and organizations focused on providing solutions to small businesses: American Express, OnDeck, Wix and SCORE participated.
Also in attendance were a media focused on small business success, including Inc, WSJ, Inc, NY Times, Mashable, Smart Hustle Magazine and SmallBizTechnology.com (represented by me!).
The evening’s moderator was Bo Burlingham, author and editor at large of Inc Magazine.
Here are highlights of the lively discussion:
Lack of capital
40% of businesses fail due to a lack of capital and ineffective marketing. Why are so many businesses on shark tank? Ignoring the ones who come just for fame, there’s many who will not qualify for traditional bank financing and want the money (and expertise) from the sharks.and who don’t know how to get to the next level.
Definition of small business is mixed
Small business formation is not a singular event, but it’s a progression that happens over time, explained Clate Mask, CEO and co-founder of Infusionsoft. Registering with the state and filing articles of incorporation is not necessarily when a business is really formed. I’ve launched 3 companies and having them “incorporated” was just one small process of their success! The progression of business growth takes place from the idea, to the test of the idea, to the legal formation of the business entity and so many others stage of “starting a business”.
(Resource – Clate’s 7 stages of small business growth).
The Main Street Forum panelists also discussed, is a small business an entity that reaches a certain level of maturity, from hobby to “business”? Or can it be a wedding that generates thousands of dollars of revenue over a few weeks, for participating vendors. What defines a “business”. Eric Mason, Director of Communication at Wix shared that out of the millions of web sites Wix hosts, there’s many representing various stages of “business”. Defining what a small business really is and their stages are important.
Running a business is just hard
If you look at the top 50 companies on the New York Stock Exchange, 90% who were there some years ago are not there today, shared Christopher Hollins, Vice President and GM of American Express OPEN Top Client Group. It’s not easy for big companies to be in business and surely not easy for very small companies to be in business. “Scaling up” is a relatively new term,. 20 or 50 years ago – you just went into business. Now startups are all about testing and scaling, Bo Burlinghman (Inc Editor at Large) shared. Fail fast (and move on) is one of the lessons of many startups.
Access to data is a game changer
Vendors who are selling to small businesses can offer precisely the technology their customers want, shard OnDeck’s COO, James Hobson. Smart companies closely analyze their customer buying patterns to ensure they’re delivering to their customers precisely what they want. For small business owners, their ability to access data at the click of a mouse gives them many more advantages than those who started their businesses even just 20 years ago. This point was not a reason for their not succeeding of course – but a reason for them (small business owners) to succeed!
Education is critical for success
Christopher Hollins shared that there is such a low barrier to start a business and it’s important to have a guide or mentor to help them succeed. Small business ownership requires so many decisions and responsibilities to go right – in order to last. David Bobbitt of SCORE shared that SCORE fills this void through their national counselling services to small businesses all across the United States.
Complicated tools and services
One of the challenges small business owner face is that using many of the services provided to them is still relatively complicated. I’m a techie and am often asked to help other business others with their technology. But it’s beyond technology complications. Even applying for a loan, getting a permit and other things a business might need are often very complicated. Eric Mason, shared that there should be an element of fun and ease of use into more small business services. All of the The Main Street Forum panelists are focused on making their offerings easier and easier to use. Wix’s web site builder is one of the easiest ways to build a web site. OnDeck shared how their loan service application and entire process is fast and very easy to use – much easier than a traditional bank.
The pain of small business owner loneliness was brought up by Clate Mask. He said working day to day all alone in the grind of their business is a problem for many business owners. The success of Meetup, #ICON 2015 (small business sales and marketing event), SCORE, American Express OPEN Forum and other communities is that they enable otherwise lonely small business owners to find help from peers and experts and/or network.
It’s hard to sell to small businesses
Some business, selling services and products to small businesses, do NOT understand how to sell to small business. Some of these vendors try to treat small businesses as consumers. This does not work. Of course treating them as Fortune 500 companies is definitely not the way to go either. There is a different approach needed – high touch and high tech – said a panelist.
Resource – Anita Campbell (Small Business Trends) and I will cover this topic at the upcoming Market2SmallBiz Conference in San Francisco in May.
The panel concluded with comments in how small businesses don’t have to do everything on their own. They can leverage talent and online services to help them manage and grow their businesses – while they focus on their customers and other things essential to their business.