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If you have kids or just want to see innovation and entrepreneurship in action you might want to take a look at this short film (10 minutes) about nine year old Caine who lives in east Los Angeles.

http://vimeo.com/nirvan/cainesarcade

These are the things that came to my mind when I first saw this short film

1. Caine, 9 years old, has tenacity.  How many entrepreneurs give up if they are not immediately successful?  How many people don’t even try a new endeavor or venture?  How many people are out there “waiting” for someone to give them a job?
2. Caine built the arcade himself.  Imagination, innovation and committment required – for every new venture.
3. Entrepreneurs help other entrepreneurs.  Why was it only Nirvan that spotted Caine’s talent?  How many people walked past Caine’s arcade without seeing what Nirvan saw?  Some people can spot talent – other’s can’t.  Part of leadership & entrepreneurship is spotting and developing talent no matter where you see it.
4. Social media.  The amplifying effect of social media.  Nirvan used Facebook to spread the word and generate a flashmob for Caine’s arcade.

The net effect

Raised $176,000 (to date) to help kids like Caine go to college.  98,000 likes on Facebook.  The Goldhirsh Foundation will match dollar for dollar contributions up to $250,000.

Goldhirsh Foundation – “The Goldhirsh Foundation funds that are providing the seed funds to create/incubate the Caine’s Arcade Foundation, which will help find, foster, and fund creativity and entrepreneurship in other innovative kids.

Visit Caine’s arcade on facebook – http://www.facebook.com/cainesarcade

Caine’s Arcade website – http://cainesarcade.com/
Interconnected – http://www.facebook.com/interconnected.is

Caine’s Arcade is a story worth telling…  and passing along.  Your turn.

The FUNcube Dongle is a USB-based Software Defined Radio capable of reception of 64MHz to 1.7GHz.

Far more interesting (or equally interesting) is the entrepreneurial story behind this product.

Entrepreneurs should check the archives on the blog site below going back to October 2010. Reading the history of this product gives you an insight into how products unfold from design to manufacture.  There are also some great pictures of the elements that go into the manufacturing process.

Just a few sample’s
http://www.funcubedongle.com/?p=37
http://www.funcubedongle.com/?p=73
http://www.funcubedongle.com/?p=69

The main site – http://www.funcubedongle.com/

Which is a larger part of this – http://funcube.org.uk/

Dave of EEVBlog did a great video on the manufacturing of short runs of prototype products like this leading to full production runs.  Very long, and detailed, but worth the watch if you are an entrepreneur manufacturing a product or if you want to see how this all works.

More Resources

Watch some videos
http://mediasite01.ceng.calpoly.edu/Mediasite/Catalog/pages/catalog.aspx?catalogId=50002546-931f-4c8c-af80-a5046f7b533c

Forum Discussions
http://cubesat.ifastnet.com/forum/index.php

The Secret History of Silicon Valley

This is a very long GoogleTechTalks video.  But, if you are interested in “black projects” related to  radio, electronics, radar, electronic counter-measures, signal intelligence, and electronic intelligence in the context of World War II, the Korean War, and the Cold War and lots of information about Stanford’s participation in classified military projects – this may be worth the watch.

If you are in to it, this is a fascinating history of military/university collaboration on black projects and the symbiotic relationship among University Engineering schools, the defense industry, and how all this gave rise to entrepreneurship in Silicon Valley and the founding of well-known companies.

Get a cup of coffee, and take a watch…  (don’t foget to check out the list of references in the Resource section below)

Resources:

See below for the list sources for the above GoogleTechTalk
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A while ago a new term entered the lexicon of popular culture; that term was “Accidental Entrepreneur”.  This came to denote a person who got laid off or otherwise lost their job and started their own business.  What could be better than being your own boss?  Well plenty, if you don’t know anything about business.  One would do well to remember the E-Myth:

… refers to the idea that most businesses fail because the founders are technicians that were inspired to start a business without knowledge of how successful businesses run.  The mythic and often disastrous assumption is that people who are experts regarding technical details of a product or service will also be expert at running that sort of business. Many small business owners eventually realize that just as they had to learn their technical skills, they have to learn business growth and management skills…. (read more)

Many Accidential Entrpreneurs don’t have a written Business Plan.  The point is not to have a business plan to have a business plan per se but to have a written business plan to demonstrate that you have thought it through and you have covered the predictable pitfalls that cause businesses to fail.

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Steve Jobs on Market Research – and why they don’t do it.

It’s not about pop culture, and it’s not about fooling people, and it’s not about convincing people that they want something they don’t. We figure out what we want. And I think we’re pretty good at having the right discipline to think through whether a lot of other people are going to want it, too. That’s what we get paid to do. So you can’t go out and ask people, you know, what’s the next big [thing.] There’s a great quote by Henry Ford, right? He said, ‘If I’d have asked my customers what they wanted, they would have told me ‘A faster horse.’’’
- Steve Jobs, Apple CEO

Read the full article -
http://www.pragmaticmarketing.com/publications/magazine/6/4/you_cant_innovate_like_apple

Cached Copy -
http://frrl.files.wordpress.com/2010/04/appleinnovation.pdf

This is a great story told by Clayton Christensen at a lecture entitled “Business Model Innovation”

Here is the get – “This is a very common phenomenon.  It is how the Indian IT companies are hollowing out the inside of their customers.  They started out just doing the bare bones simple code, and they just keep integrating more and more forward, taking more and more of the value-added until it is really not a, it is almost a, it is not clear whether the IT departments are outsourcing to TCS and Infosys or whether Infosys and TCS are outsourcing the brand from their customers”

Now there is another kind of disruption that occurs that is rooted in the gospel that we should always outsource everything that is not our core competence.  I’d like to just walk you through an interaction between a supplier and a customer that is typical of this interaction in many different industries.  So I am just going to describe this as an interaction between Compaq, a late, great computer manufacturer, and Flextronics, one of its suppliers.  But I’ll just use these as representatives of Dell and Asus Tech and a bunch of other interactions.

So Flextronics starts out making the simplest of the circuit boards inside of a Compaq computer, piddly little Singapore-based company.  They came to Compaq then with an interesting value proposition.  It was, “You know we’ve been doing a good job on the little boards, why don’t you let us do the mother board because circuit manufacturing isn’t your core competence, and if you give it to us we could fabricate those for 20% lower cost.”

Well Compaq’s analysts looked at it and realized, “Gosh, they could.  And if we gave the mother board to them, not only could we drop cost by 20%, but we could get all the circuit manufacturing assets off the balance sheet,” because it was very capital-intensive.

So they shoveled that over.  Compaq’s revenues were unaffected but their profits improved, it felt good to get out of the mother board.  Flextronics’ revenues improved and its profits improved.  It felt great to get into the mother board.

Then Flextronics came back.  “You know we’ve been doing the mother board for you, come to think of it, that is really the guts of the computer.  Why should you have to bother to assemble the rest of the stupid computer because assembly is not your core competence.  Let us do it.  We could do it for 20% lower cost.”

And Compaq’s analysts looked at it and realized, “Gosh they could.  And if we gave assembly to them, not only could we drop costs but we could get all the other manufacturing assets off of our balance sheet.”  So they shoveled that over.

Compaq’s revenues were unaffected but their profits improved.  It felt good to get out of assembly.  Flextronics’ revenues and profits improved, it felt good to get into assembly.

Then Flextronics came back.  “You know we’ve been assembling your computers for a while, doing a good job.  Come to think of it, you shouldn’t have to bother to manage the supply chain, dealing with the component suppliers, working out all these logistics headaches, shipping your dumb computers to your stupid customers.  And logistics isn’t your core competence.  Let us take on the supply chain.  We could reduce the cost by 20%.”

And Compaq’s analysts looked at it and realized, “Gosh, they could.  And if we gave the supply chain to them, not only could we drop costs even further, but we could get all the current assets off the balance sheet.”  And so they shoveled that over.

Compaq’s revenues were unaffected but their profits improved again, especially return on assets, because they’ve got no assets.  And Wall Street loves asset-like companies.  Flextronics’ revenues improved and their profits improved because they are getting into value-added services.  And Wall Street loves value-added services.  It felt good to get out of the supply chain and good to get into the supply chain.

Then Flextronics came back.  “You know we’ve been managing the supply chain for a while.  Come to think of it, you shouldn’t have to bother to design your dumb computers, because design really is little more than component selection and we’ve got all those relationships.  Why don’t you let us design your computers?  We could do it for 20% less cost.”

Compaq’s analysts looked at it and realized, “Gosh, they could.  And if we gave design to them, we could fire all of our engineers, drop our costs even lower because our core competence in the end really is our brand.”  So they shoveled that over.

Compaq’s revenues were unaffected but their profits improved.  Flextronics’ revenues and profits improved.

Then Flextronics came back one more time, but this time they did not go to Compaq, they went to Best Buy.  “You know here we are, one of the world’s best manufacturers and designers of the world’s best computers.  Come to think of it, you know those brands Hewlett-Packard and Compaq and Dell on your shelves, you don’t need to stock those brands.  We’ll give you our brand, your brand, any brand at 20% lower cost.”

And bingo, one company is here, another one takes its place.  And just like the mini mill story, you notice I was able to tell this story without using the words “stupid manager” once.  Because Compaq did everything that good managers are taught to do, focus on what they believe are their core competencies, outsource the lowest value added of the activities they are performing if there is somebody who could do it better.  And yet when this happens you create again that same asymmetry of motivation that one company is motivated to flee from the very market that the other company is motivated to attack, until ultimately the outsourcer liquidates its business model to its customers.

This is a very common phenomenon.  It is how the Indian IT companies are hollowing out the inside of their customers.  They started out just doing the bare bones simple code, and they just keep integrating more and more forward, taking more and more of the value-added until it is really not a, it is almost a, it is not clear whether the IT departments are outsourcing to TCS and Infosys or whether Infosys and TCS are outsourcing the brand from their customers

Or, Advice to Prospective Entrepreneurs

“…Out of such dreary statistics comes a new class of self-starter, the accidental entrepreneur–someone who never considered owning a business until there was no other option. These entrepreneurs are making tough choices for themselves and their families, living in reduced circumstances, doing without the corporate comforts and resources they once took for granted, sometimes succeeding, very often failing, invariably struggling. But at least they’re not waiting for the phone to ring.”

-Fortune Magazine

I wonder if it’s bad advice and a bad judgment to recommend to someone to start their own business.  There are a couple of scenarios.

Scenario one, you are long-term unemployed and you make the judgment to start your own business.  Scenario two, you leave your current  job due to your “Entrepreneurial Spirit” which can’t be satisfied at your current company and start your own business.  What could the future hold?

It’s easier to start your own business than find an employer

In the first case you are caught with few options.  But is starting you own business a good decision?  That depends on who you are (“mind-set”) and where you are (“what was your last position in the corporation”).  If we use  Gerber’s terms…  In your mind-set are you a technician, a manager, or an entrepreneur?  In your current or last job, do you hold a position of technician, manager, or entrepreneur?  Do you think you have the mind-set of an Entrepreneur stuck in the position of a technician?

The failure rate of small business start-up’s is staggering.  Dun & Bradstreet has nearly a century of experience in reporting on the health of businesses.  The story is the same over and over.  About 1/2 of the start-ups fail within the first 18 months and only 1 in 5 lives as long as 10 years.  Dun and Bradstreet categorize 92% of business failures as bad management.  Is that the real story?

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Revenue sharing

So you thought that all the content that people put up on YouTube was a waste of time?  Not so.  Google now has a Partner program and revenue sharing model with content providers.

If you have good content, lots of subscribers, and lots of hits, you can apply to be part of the Google / YouTube Partner Program.

I must have been asleep on this event – I just found out about it.

And, I was amazed at just how much money people are making on this.

The top channels on YouTube are making six figures a year in revenue sharing with Google based on click throughs to ads that appear on channel video pages.

Accidental…

Well, all I can say, is that all the work that early adopter YouTube content providers made to develop popular creative content for YouTube (at no compensation to them) finally has paid off – unexpectedly.

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Accidental Entrepreneurs ?

“(08-11) 17:45 PDT — A month after he was laid off in October, 38-year-old Marcus Ronaldi realized he was facing the toughest job market he had ever experienced. “I had been out of work before, but this time I wasn’t getting any calls,” said Ronaldi, a high-tech job recruiter.

In November, as he despaired of landing a full-time job, Ronaldi started taking subcontracts from other recruiters with hard-to-fill vacancies in technical or executive fields.

“At first I did it just to keep busy and to help pay the bills, while I continued looking for a job,” said Ronaldi of Daly City.

But as he got more contracts, Ronaldi began to consider himself self-employed, a conviction that jelled a couple of weeks ago when he got a tip about a full-time job.

“I turned the tip over to a friend because I was happy doing the contingent stuff,” he said

Ronaldi is an example of what Bay Area business analyst Carolyn Ockels calls “necessity-preneurs” – people who become self-employed because regular jobs are so tough to find.

“I think a lot of people are trying to fill the income gap with any skill or service they can find,” said Ockels, managing partner of Emergent Research in Lafayette.”

A July report from the Small Business Administration documents the self-employment surge nationwide. The SBA said the number of self-employed people grows about 2 to 3 percent a year when the economy is good. In 2008, the most recent year on record, the number of people working for themselves jumped 8.1 percent.”

Accidental Entrepreneurs / Necessary Entrepreneurs ?

Wow.  People starting their own business.  “Accidental” and “Necessary” in the context of Entrepreneurs does not give the impression that the decision to go into business was an intentional, planned, deliberated, and considered process.  It sounds more like a reaction to unexpected (or at least, undesirable) series of past events. 

Is “taking the plunge” into small business a good idea if you are an “Accidental” Entrepreneur?

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“With roughly 6.7 million jobs lost since the start of the recession, it’s tempting – and often a great idea – to launch your own business. That way, of course, you can take matters into your own hands. No more rolling your eyes at the boss; it’s your show.”

Of course, reading something like the above is going to encourage some segment of the 6.7 million to rush out and start their own business.  “No more rolling your eyes at the boss; its your show”.

The great thing about small business is that there is nothing to stop you.  Now that could be a good thing or a bad thing.  You are free to succeed or fail. ”It’s your show.”  No one to blame but yourself.

There are a handful of reasons why people start their own business.

Maybe you have a great idea.  If you worked for a large mature Fortune 500 company and you wanted to create a new product or service – guess what – you are going to be in for a long, difficult, and treacherous road to actually seeing  your vision realized  in the corporate marketing collateral and your product or service being delivered or offered.

In this case, why not kiss those corporate folks good-bye and start your own business?  If you had your own business “It’s your show” and no one is there to stop you.

Read the rest of this entry »

“With roughly 6.7 million jobs lost since the start of the recession, it’s tempting – and often a great idea – to launch your own business. That way, of course, you can take matters into your own hands. No more rolling your eyes at the boss; it’s your show.

…There’s this very sad pattern about how people start businesses,” says Scott Shane, an entrepreneurship professor at Case Western Reserve University in Cleveland, Ohio. “People are most likely to start businesses in industries where start-ups are most likely to fail.”

Read the full article and find out more

http://frrl.files.wordpress.com/2009/02/smallbusiness7mostoverratedbusinesses.pdf

Economic woes in 2009?  How much of the economy is small business and how do you measure small business competitiveness and success?

How do you Measure Small Business Success?
Competitiveness in this context is defined as the level of success a small business achieves in
conducting the organizational activities critical to its short and long term viability. The more
competitive a small business is, the more likely it is to meet the personal and business goals of its
owners and show positive financial results. Because success is multi-faceted, an index is needed
to adequately assess it. The Small Business Success Index (SBSI) provides one overall
measure of success, based on several unique dimensions of competitiveness. Success can
therefore be quantified on a scale of 0 to 100 (completely failing to completely successful). The
SBSI is based on 28 measures, which capture the six dimensions (or sub-indices) below:

A Quick Read on the State of Small Business and the Small Business Success Index
2009 Baseline Study of Small Business Success State of Small Business Report
from Robert Smith School of Business at University of Maryland & Network Solutions