The StartUp Blog at PartnerUp

How to Create a Successful Brand

Creating your company’s brand is one of the most important things that you’ll do as a business owner. Whether you’re starting a new company, or expanding an existing small business, having a strong brand that represents what you do, conveys a professional and stable image, and builds a relationship with your target audience is essential to the success of your company.

When most people think of branding, they think of customers, but they fail to see the impact that a strong brand has on all of the other functions of their business. Having a great brand that conveys that your business is stable and professional can contribute positively to your company on so many levels.

Consider this: You’re a banker or investor, and you get approached by two companies. The first sends you a pitch on plain paper, stuffed in a plain envelope and includes a business card that they printed on their home printer. The second sends you a pitch on company letterhead, has a unique logo, includes a business card that is well-designed and professionally printed, provides some professionally printed brochures and backgrounders on the company, and puts it all into a professionally designed and printed folder and envelope. Which company would you feel is more professional, stable, likely to engage successfully with consumers, and ultimately more likely to generate revenue?

It doesn’t just stop with investors and banks, either. Potential employees are more likely to want to work for a company that connects with them through a strong brand. Even vendors, who are selling you something, are more likely to be willing to negotiate extended terms or special agreements with a company that appears professional, established, and stable.

Here are some tips for creating a killer brand for your small business or startup:

1) Find the right name for your company. A short name that conveys what you do is always the best. Try to find a name that allows you to secure its .com domain name. Also, always make sure to do a little bit of research to ensure that the name you want to use isn’t already trademarked or in use by another person or company. Megan from PartnerUp wrote an excellent article on our blog about how to name a company.

2) Have a logo professionally designed. Your logo is the centerpiece of your brand and will appear on everything from business cards and stationery, to apparel, to your building and signage, so it’s not worth skimping here. An exciting trend in logo design is online logo design companies. In the past, it would cost thousands or tens of thousands of dollars to have an ad agency design a logo for you. Today, through the internet you can find several companies who offer logo design for less than $800. Before choosing a logo design company, look through their portfolio and make sure that you like their work, then contact a few previous customers to make sure that they were satisfied with the results.

3) Create brand guidelines. Most people have never heard of brand guidelines, but they are so important to a strong brand. For a sma ll business, brand guidelines can be as simple as a 2-3 page document that describes what colors your logo should appear in, what fonts your company uses on documents, signs, and brochures, what size your logo should be with respect to its page, what tagline should appear with your logo and where, what format brochures should use, what signage should look like, how employees’ e-mail signatures should appear, and other basic brand guidelines. The goal here is to create consistency across all of the different types of media your brand will be seen on.

4) Have stationery and brochures professionally designed. Many business owners are tempted to create their own stationery and brochures to save a few dollars. Most of the companies that do online logo design also do stationery and brochure design. This investment is well worth it and will really help to convey a unified and professional image for your business. I recommend creating your brand guidelines first because you can then send these guidelines to the designer working on your stationery and brochures so that they’ll conform to your newly-created brand standards.

5) Get everything professionally printed. On a per-page basis, it is usually no more expensive for you to hire a professional printer than it is to print things yourself. However, the results are much different — collateral printed by a professional printer looks, well, professional! This is very important to building a strong brand.

6) Get a web site and domain name. Have a web site professionally designed and hosted on your own domain name. Business has shifted from being done using phone books to being done online. Accordingly, your web site will in many cases be your first contact with potential customers. Invest in your web site accordingly.

7) Buy a phone system and get a phone line for your business. It used to be expensive to buy a phone system, often costing tens of thousands of dollars. Now, you can buy simple pre-configured phone systems with an auto-attendant for less than $1,000. Use the auto-attendant and have someone that you know (not yourself), with a professional-sounding voice, record the greeting and prompts for your phone system. This is another easy way to maintain a level of professionalism that your customers and investors will expect to see in a stable business.

Invest in public relations. One of the most important things that you can do to gain credibility for your business is to get third-party validation of your business or concept. The best way to accomplish this is through public relations. Once you get your company featured in a few articles, you can show these to potential clients, investors, and vendors, helping to further solidify your company’s brand and po sition in the marketplace. Hiring a PR firm for a small business or startup can cost as little as $3,000 per month, and is well worth the investment.

9) Remember, it’s never too late. If your existing small business doesn’t have a stellar brand, remember that it is never too late for you to rebrand your business using the above advice. If you decide to rebrand, make sure that you try to roll out your new brand all at the same time instead of peice by peice. This will help to generate excitement surrounding your new brand and will avoid creating a disparetely branded company image, consisting of stuff with your old logo and stuff with your new logo.

If you follow the above tips, you should be able to effectively create a killer brand for your startup or small business without spending tens of thousands of dollars.

Writing a business plan can seem like a piece-of-cake compared to the tedious task of creating a company name. It seems like such a trivial component, but so much of a company’s success rides on its name. Starting a business with a weak company name is kind of like driving a car — without an engine, it probably isn’t going to go anywher.

But don’t fret; PartnerUp has put together an A-to-Z guide to deciding on a stellar company name. Bear in mind the following tips and you should be able to find the perfect name for your company.

Acronyms: Be careful when using an acronym as your business name. Acronyms are often confusing and sometimes spell out unintended words.

Back-ups: Create at least two, maybe even three, back-up names for your business. When you go to register the name, your first choice may already be taken.

Competitors: Make a list of the names of your competitors. You can use their names to get ideas, but the main idea is to make sure your name is distinct from the others.

Domain Names: Make sure that the name of your company would also make an attractive domain name. And make sure that domain name isn’t already taken.

Expansion: Consider the expansion of your business. If your business were to expand, would the name still be fitting? It should be able to roll with the changes.  

First Letter: The first letter in your company name is important because it determines where your business will be listed in directories. Many companies choose to start with a number or the letter “A” to ensure early placement. This was more important in the olden days of yellow pages being a huge ingredient for success, but nonetheless remains a consideration.

Gut Feeling: Never underestimate your gut feeling about a name. You should feel very strongly about your company’s name. You are the one who has to live with it.

Headlines: Picture the name of your company splashed across the headlines. Does it look and sound good?

Industry: Make sure the name conveys the industry your business is in. Give some clues as to what exactly you do. This makes it easier for potential customers/clients to seek out your business.

Jot: Jot down a list of adverbs, adjectives, anything that could describe your business. Gather as many words as you can and then start playing around with them.

Kleenex: Even though Kleenex is used in everyday language as a tissue, it is actually a trademark. Common words like Frisbee and Rollerblade are also trademarks. If you have a product that you think is going to be big, come up with a name that could be a trademarked name used in everyday jargon.

Length: A trap that many companies fall into is trying to include too much information in the name. People don’t want to remember long-winded names, so they don’t. Your name should fit well on a business card, sign or advertisement.

Memorable: This is, by a landslide, the most important element in creating a company name. People should hear your business name and be able to commit it to memory; another reason long names don’t work.

Name (your own): Using your own name, or a combination of names for multiple owners, shows that you are willing to give your customers personal attention. But it can be difficult to make a company name with your own name memorable.

Opinion: Test your company names on friends and family. Their opinion matters—after all, they are consumers.

Pronunciation: Your company name absolutely has to be easy to pronounce. If it isn’t, people won’t even bother trying to remember it.

Quirky: So many people try to come up with quirky and weird names because they think these names will catch people’s eyes. Many times they are right, people are intrigued. Your name can certainly have personality, but it should still sound professional.

Regulations: Always make sure you check state regulations on naming a business. Also, make sure that the name of your company doesn’t sound like the name of a government entity/agency.

Spelling: The name of your company must be easy to spell. Avoid any and all confusion. If people are confused, they will immediately forget you.

Trademark: Do not teeter with someone else’s existing trademark. If there is the possibility that you could be infringing upon it, then there’s also the possibility that you could get slapped with a lawsuit.

Unique: Coming up with a unique name is always a good idea, just as long as it still adheres to the previous tips.

Visualize: As humans we innately “see” images when we read and hear language. Try to use strong visual language when naming your company.

Web site: Online businesses obviously have a Web site, but so do many other types of businesses. By creating a distinct name, you can make your name more easily searchable on search engines, resulting in more traffic.

X-factor: Okay, so “X” is a difficult letter to work with, but “x-factor” really does work here. It’s what every name should have—that certain something that makes it successful.

Yellow Pages This goes hand-in-hand with the “first letter” entry. When people search through the Yellow Pages, they almost always start at the beginning of the alphabet and work their way down. If you are in a niche industry and have few competitors then this won’t affect you much. But if your company is in, let’s say, the pizza business, and the name of your business starts with a “Z,” don’t hold your breath waiting for the phone to ring.

Zero: This is the number of customers/clients you might end up with should you not utilize any of these tips.

Editor’s Note: This post is the first in a new series that we’re doing which will contain helpful tips and advice for starting a business. Also, you can look forward to us updating the StartUp Blog a lot more often. If you have ideas for topics that you’d like to see us cover, please drop us an e-mail at startupblog@partnerup.com

How to do market research

Great ideas are left by the wayside everyday because people aren’t sure if their ideas are worth the risk. They also aren’t sure how to go about finding out if their ideas are worth the risk. Though it is no doubt a tedious task, performing market research is the only way you can thoroughly assess whether or not your business idea could be a success. Moving forward with your idea hinges on your research and assessment of the competitive marketplace. It is a necessary step in the business process. So how do you actually do it?

Well, it’s not as difficult as many people think. PartnerUp has compiled a five-step process that will guide you through the market research phase of you business. Follow these five steps and you will be well on your way to assessing the future profitability of your business.

Step 1: Evaluate the potential of your business idea.
When performing market research you must first do a quick and dirty evaluation of your business idea’s potential. Find five potential customers. They can be either people or companies, so long as they are truly representative of your target customers. Make sure each signs a non-disclose agreement, which prohibits them from sharing the information you give them and therefore protects your idea. Once that is taken care of, proceed to tell them about your product or service. Don’t overload them with information, just give them what they need to decide if they would be willing to be a customer or not. Then ask them their opinions. Would they buy your product/service? If so, why? If not, what can you do to make it better? Be sure to make it clear that you want their complete honesty.

Step 2: Perform the initial market research.
If at least one of the people or companies said they would be willing to buy your product or service, then get moving and put together some preliminary market research First type your idea, or variations of your idea, into any of the major search engines (Google, Yahoo, etc.). What you are doing here is determining if someone is already providing your product or service. Make a thorough list of each company that can be considered a competitor. Note its web address, location, product/service offering and pricing. Assemble this information on a spreadsheet.

Once the information is assembled, figure out answers to the following questions:

How many competitors are in the marketplace?

What do you think is the total sales per year for your industry?

How much market share does each competitor have?

Does it look like the companies in this market are making money?

Step 3: Find out the cost for creating your product of providing your service.
It is not enough to say that since another company can sell its product or service for a certain amount that you can sell for slightly less. That company could be improperly costing its product or service, or it could be offering the product or service at a loss. So don’t skip this step.

If you are providing a service, calculate exactly how much it will cost to provide it. Add together the direct labor costs, all of your overhead and any other costs you incur. Calculate overhead carefully. Account for phone lines, internet connectivity, computers, equipment, supplies, etc. Don’t make the mistake of underestimating the cost of providing your service.

If you are offering a product, contact engineers and contract manufacturers and have them give you prices for designing and producing your product. Add this number to your total overhead and expense. Once you have a total, make an educated guess as to how many products you expect to sell. Divide the total number of expenses by the number of products you expect to sell. That will tell you at least how much you need to sell your product for in order to make a profit.

Step 4: Find out who might sell your product.
If you’re planning on selling your product or service through a retail outfit, call the company and find out who their buyer is. Call the buyer and ask for a brief meting. Large companies like Target, Best Buy or Macy’s are actually very approachable. They have hundreds of buyers whose job it is to find the hot new trends and items. So don’t be afraid to discuss your ideas with them. If they are interested, tell them you are in the exploratory phase of you business. Then ask them a few questions. What are some rough guidelines regarding the sort of margin they expect? Do they expect co-op marketing money (which means you paying for a share of the marketing efforts)? Do they sell on consignment, or do they purchase products outright? This information should allow you to make a complete analysis.

If you’re planning on selling your product or service through a sales force, find a few salespeople in similar but non-competitive lines of business. Get together with them so that you can ask them what sorts of commissions they make, how sales are handled and what they expect for a commission and final selling price for your product or service.

If you’re planning on selling your product or service through direct marketing, call a few small to mid-sized marketing firms that specialize in direct marketing in your industry. Set up a meeting to hear about their qualifications. Ask questions and get their input on the cost of marketing your product or service. Tell them you are in the exploratory phase and want rough numbers. That way they will let their guard down and offer honest advice.

Step 5: Crunch the numbers and decide if it’s worth it.
Now it’s time to calculate all the variables. Add up the total cost of producing and offering your product or service, the selling cost (or the retailer’s margin expectation) and other expenses incurred. Now compare your cost to that of your competitors. If your product or service is more expensive, don’t immediately panic. Your product or service may be distinct from that of your competitors, in which case people may be more willing to pay extra. If your product or service is the same as your competitors, however, and is still at a higher price, consider it a red flag.

Now that you’ve thoroughly assessed the competitive marketplace, it’s time to decide whether or not it is worth moving forward with your business. Your assessment may take you a week or so to complete, but in the end you will appreciate the effort put forth.

No matter the size of the venture, all startups need one very important ingredient to start, succeed and ultimately survive–money. Some startups get it from venture capitalists or angel investors. Some lucky ventures are even built with small-business loans and grants. But if you’re panicking because you’re not getting the financing you need from these sources, relax and follow in the footsteps of successful startups like Dell Inc. or Craigslist Inc.

The founders of these famous companies pulled themselves up by their bootstraps and invested in their ventures with their own money. Bootstrapping your business, the act of avoiding external investors, means going solo in the financing department, all the while keeping expenses to a minimum.

Many business schools widely promote the use of external investors. They teach you to write a lengthy, in-depth business plan and then pitch it to investors. But burning through someone else’s money is not always an option, nor is it always the smartest route. The plain truth of the matter is that finding other people (i.e. venture capitalists, angel investors, banks, the government, etc.) who are willing to gamble their money on you is just plain unlikely.

If you’re thinking of getting a small-business loan from the bank, think again. Startups are risky endeavors, and banks are not well-know for their risk taking. In the end they are not willing to waste their money on you, so don’t waste too much of your time on them. That’s not to say that small-business loans aren’t out there for you, just don’t hold your breath. Small-business grants from the government work much the same way, except that they are even harder to come by, and the time it takes to search for them rarely pays off.

Most startups try to go the route of venture capitalists or angel investors (also know as “angels”). In 2006, venture capitalists invested $25.5 billion in startups and businesses, according to the National Venture Capital Association (NVCA). Angels put up similar numbers, investing $25.6 billion in 2006, according to the Center of Venture Research (CVR) at the University of New Hampshire. These figures are staggering, but if you take a deeper look, they are also very deceiving.

Far less than 1 percent of companies that pitch venture capitalists actually receive funding. They invest billions, but they do so for only a select number of ventures. Venture capitalists are generally interested in larger investments. Deals under $1 million are infrequent, while pricier deals occur daily. Venture capitalists are also more willing to invest money in companies that already have a solid base, not fledgling startups.

Less than 2 percent of pitches to angel investors are ever even considered. An average of 30 percent of these deals that are considered by angel investors is actually accepted, according to the CVR. Again, 30 percent sounds like a promising figure, but it also has its holes. An angel is typically an affluent individual who, much like a venture capitalist, provides capital for startups. The problem with pitching an angel, however, is that it can be very difficult to grab his or her attention, and angles usually consider very few deals.

Striking a deal with an angel is not impossible, though. To get the attention of an angle, your business should be in the same field that he or she has come from or is interested in. If your business is in the restaurant or hospitality realm, don’t pitch to an angel whose life’s work is in Internet technology. Once you’ve found your angel, the best way to get in touch with him or her is through a trusted referral (i.e. accountant, lawyer, etc.). Angels often shy away from complete strangers. When or if you do get a meeting with an angel make sure that you have three things firmly in place—a knowledgeable founder, a solid team and a sound investment for the angle. If you don’t have all three, you’re probably wasting your time.

Financing your business the conventional way—with someone else’s money—involves spending a lot of time chasing deep-pocketed investors who, when all is said and done, are statistically more likely to be uninterested than they are likely to be interested. Bootstrappers, on the other hand, focus their energy on making money and being smart with it, not raising money and wasting it.

Bootstrappers get financing in several different ways. Some of the more common forms are credit cards, personal savings, or friends and family. If you’re thinking to yourself, “Wow, that’s really risky!” You’re right. It’s very, very, very risky. But there is a reason bootstrapping is increasing in popularity.

Bootstrappers maintain a customer-focused mentality from day one. They have to. Externally funded business owners, on the other hand, are often fooled into thinking that they already have a business because they can pay salaries and rent. But the truth is you only have a business when you have paying customers. Bootstrappers have nothing to focus on but their customers. They also build cost-effective businesses right off the bat. They can’t waste much money when there isn’t much money to waste. Bootstrapping is a solid investment for anyone with the determination and brainpower to find a way to make it work.

Make no mistake; I’m not writing off the use of external investors. For some startups they are the right choice, but so few startups have that choice. Instead the majority of them are forced to start with little or no money. But don’t be discouraged, it is probably a blessing in disguise. Not only do you end up owning most, if not all that you create, you also get to run it with the freedom and flexibility that only comes with a bootstrapped business. Bootstrapping is a risky venture, but the payoff is usually worth it in the end.

And, think about how much more interested VCs, angels, and banks will be when you can call them and tell them about how much money you’re already making and how much more you would be making if you had their capital for expansion. Getting them to buy into an operating business is a lot easier than getting them to buy into a concept.

Jeremy Shoemaker, more commonly known as ShoeMoney, is a heavy hitter in the search engine marketing world. Because of his extensive knowledge and expertise he is considered one of the go-to guys in areas such as pay-per-click (PPC) and online income optimization.

Jeremy writes a well-known business blog, shoemoney.com, hosts a weekly Internet radio show called Net Income, and will release a new book this spring called the ShoeMoney Playbook. He is also the CEO of ShoeMoney Media Group.

Jeremy recently took us through what he believes are the most important phases in starting a web-based business.

Conception Phase: This is where you brainstorm and come up with the grand ideas

Functionality Phase: Can this really work? Talk to programmers/designers find out costs and really know where you are at.

Launch Phase: This is a big PR phase. You need to get the word out.

Marketing Phase: Go after low hanging fruit and find out how to get more people to your site/business.

Monetizing Phase: Once you have a good user base how can you better monetize your business.

Managing Phase: Now that everything is in place you need proper management to ensure it will keep running well while you go onto your next big thing.

Author, speaker and entrepreneur Guy Kawasaki knows a thing or two about putting together a killer startup team. He is currently the managing director of Garage Technology Ventures, a venture capital firm that invests in extraordinary tech startups. In the 1980’s Guy worked as a marketer for Apple and was integral in turning Macintosh customers into Mac fanatics.He has also written eight books, the latest of which, “The Art of the Start,” is about turning ideas into action.

Guy recently answered some questions for us about how to put together a successful startup team.

Q: What sets of skills do you look for in the team members of a startup? Should you look for people with skills the same as yours or different?

A: Startups are pretty simple: someone has to create it, someone has to sell it, and someone has to collect the money. So generally, a team should have these three skills and not, for example, be all engineers, all marketers, or all accountants.

Q: How many team members, do you feel, are needed to adequately launch a startup?

A: Two or three are sufficient. One is lonely. Four is overkill for the three main roles.

Q: What personal qualities (personality, etc.) do you look for in startup team members? Are there any qualities that you always try to avoid including in your team?

A: You always look for “chemistry,” but I think this is bull shiitake. It’s funny how if a company is doing really well, all the jerks can get along. Also, if a company is tanking, even the nice people start getting testy. You could make the case that nice people communicating well can make a company successful, but I think luck is more powerful than this factor.

Q: Do you prefer to see startups teams where each team member has some of their own money invested, or are you ok with only one team member providing the seed money?

A: It really makes no difference…to the extreme of no one investing any of their money. The theory is that a team will spend its own money more carefully. However, if it’s the team’s money, they also think that the other investors shouldn’t have as big an influence.

Stay tuned for some more Q&A’s from interesting people in the business/technology field over the coming weeks.

Last year turned out to be a busy year for M&A activity in the technology sector. So, we've compiled a comprehensive list of all of the mergers and acquisitions in the web, social networking, technology, internet advertising, hardware, software, mapping, and gaming industries. We've tried to provide an overview of the blog/media/press coverage for each acquisition and we've linked to the official press release where available. Stay tuned for some upcoming posts that take a closer look at some of the acquisitions from an analysis perspective.

An interesting trend that we've noticed, specifically in the web/internet/social networks spaces, is that smaller acquisitions in the $5-20 Million range are happening much more frequently than in the past. This is likely because acquirers are snapping up startups before they raise substantial capital, making the acquisitions much less costly and providing the ability to do more deals.

Finally, thanks to all of the great blogs out there (TechCrunch, GigaOm, Mashable, VentureBeat, ReadWriteWeb, and more) who are tracking acquisitions every day, making this list possible.

If you know of any mergers or acquisitions that we missed, please leave a comment on this post.

Web/Internet Companies Acquired in 2007

Social Networking Companies Acquired in 2007