Thinking Through the Holidays, Part 1

I really like to think.

Not a meditational, navel-gazing sort of thinking, but a get uncomfortable and challenge your assumptions sort of thinking (though I do reserve the right for the occasional navel gaze in moments of contentment or lethargy). The Economist is my read of choice for current events (particularly for politics and world affairs). For their holiday issue this year, they've thrown out some superlative mental floss. For your consideration, start with "Arguing to death", a contemplation of Socrates in today's America.

Because it's Festivus...

For the lower case deity nerds in all of us:

Full Rebuttal post link

In case anyone wants an all in one go copy, download it here.

Rebuttal To Kill The MAPS Tax's Top 10 List: Epilogue

In the end, the KMT’s Top 10 list leads me to draw several conclusions about the parties involved on that side of the issue:

1. Many have competing interests.

2. Most of the people crafting the talking points seem unfamiliar with actually running large organizations or economic development projects.

3. A lot of the rhetoric involved requires people to maintain a deep distrust of anyone with money or influence.

4. Many of the arguments act as if there’ll never been another time to address other issues (like public safety).

5. A lot of non-OKC residents certainly love to pile on with their opinions.

6. Everyone ignores that even with the current 1% rate in place, Oklahoma City still has one of the lowest sales tax rates in the metro area.

Perhaps most importantly, the folks in the KMT movement don’t seem to be part of the cooperation, collaboration and trust that has made our city so successful in recent times. If you go to other cities, and talk to business leaders or economic developers or city managers or local policy makers, Oklahoma City is the envy of people around the country because of our ability to pull together for common causes. Growing a city takes a lot of time, effort, planning, and foresight. Most of all, I would argue that it takes trust. That’s historically been in short supply both here and other places. The people who’ve been at the front of this city’s efforts to reshape itself into a thriving community have demonstrated their trustworthiness. I, for one, want to continue to dance with who brought us. I hope everyone else dances as well.

Thanks for reading.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 1

KMT states:


1. A Tax Cut Will Stimulate Oklahoma City's Economy with $80-90 Million in Additional Sales.

This was already largely addressed under Point 9, but it’s worth revisiting. In this economy, what do you think will have a stronger impact: giving every Oklahoma City citizen a hypothetical ten dollars a month tax savings, or employing the people who will build $777 million in capital improvements? The latter scenario will also necessitate various supporting businesses for those working on the projects, and will stimulate the labor market by creating new jobs and therefore job mobility. This, in turn, will drive up sales tax receipts by providing the citizens of Oklahoma City with jobs CREATING ASSETS for our future and for our city.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 2

KMT states:


2. Sales Taxes Are Regressive.

I wouldn’t object to an exemption of groceries (specifically unprepared foods) from city sales tax (ideally, all sales tax). I also agree that sales taxes place a heavier burden on those with lower incomes. However, I definitely disagree with the statement that “the upper and upper middle class people pushing MAPS3 ridicule those who complain over “a few dollars a month.”

DISCLAIMER: AXE GRINDING AHEAD

Let’s set the record straight: I’d definitely consider my family a middle-class family. We lead a relatively comfortable existence. Until recently, I was the sole income provider for our family of four by choice. I also recently decreased the number of paying jobs I hold from three down to two. I don’t ridicule someone to whom ten dollars a month may matter a great deal. I ridicule someone who tries to use class and income to divide me from my neighbors. This has nothing to do with lattes, spam, shoes or formula. I’m a father and husband who wants his family’s home to be the best it can, and offer opportunities for growth and recreation. It’s worth my sacrifice to make this city…OUR CITY…a better place. What the KMT’s should realize is that I won’t begrudge their use of the fruits of my sacrifice. I will begrudge, however, their attempt to interfere with my efforts to better our city for their own selfish agendas. JFK stated that “a rising tide lifts all the boats”. Our river finally has water. Now we’re trying to raise more boats.

NOW EXITING GRIND ZONE

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 3

KMT states:

3. New Maps Projects Will Drive the City's Operating Budgets Deeper in the Hole.

The KMT site states that “All projects are for capital expenditures, with no provision for increased operating or maintenance costs.” I would challenge the opposition to MAPS 3 to approach the City’s Finance Department or Planning Department and merely ask for current estimates for how these new assets will be maintained. Do you really think that you’d account for maintenance in the tax numbers? These assets will be used and administered by some authority, public or private for the benefit of Oklahoma City.

Do we need more public safety? I feel definitely so regarding police, and perhaps with fire. However, efforts to further develop our city’s infrastructure, specifically from the core outward, enable more coverage in terms of density and focus without the burden of providing city coverage in suburban and rural areas. There are numerous ways to accomplish this expansion of services, but we should all be able to agree that public goods that can benefit many and produce return in excess of their cost will pay for themselves by enhancing the value of our city.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 4

KMT says:

4. Maps3 is a Slush Fund for the City Council.

The MAPS 3 initiative is NOT “a blank check signed by the taxpayers”, as the KMT site alleges. Merriam-Webster defines “slush fund” here as “an unregulated fund often used for illicit purposes”. The fund is regulated by ordinance, listed here. The plan for MAPS 3 must be a resolution, not an ordinance. That resolution is provided here. The list of the intended projects is listed here, and the ability to change those products has to exist because THINGS HAPPEN! The fact that the MAPS 3 program is “totally fluid and subject to change” should be a comfort to all Oklahoma City citizens, not a concern. (Note: if you want all the docs surrounding the City Council activity leading up to the adoption of the ordinance, the resolution for the plan, and the go-ahead for the election, you can find it all here).

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 5

KMT states:

5. Mick Cornett's Maps3 Numbers are as Fraudulent as Harry Reid's Obamacare Numbers.

I’ll admit that this is the biggest concern I have with MAPS 3. Yet, I’m okay with the risk for the following reasons:

A. This is the same team that made the MAPS for KIDS forecast, and was uncannily accurate, despite starting pre-9/11 in a recession and ending in a downturn.

B. If we come up short, we don’t build or we go back and vote an extension. The way MAPS works, lest everyone forgets, you have the money in hand before you start construction. If costs go up, you cut somewhere else. If you don’t collect the money, you either don’t build or change the plan or ask for additional collection time.

Besides, what’s with the inflammatory language about Mayor Mick? I don’t agree with some of his stances on things, but I don’t think he’s a liar. I’m even more willing to assert that he wouldn’t commit fraud for the sake of passing MAPS. Also, to insinuate that these projections are HIS numbers (like he ran the spreadsheets)…whatever.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 6

KMT states:

6. The Most Popular Projects are Being Used to Sell the Least Popular.

You know, this point may be somewhat legitimate. I’m sure sidewalks and outdoor facilities are much more popular than convention centers. However, guess what? You’ve got to pay to maintain those sidewalks and outdoor facilities. How might that happen? I’d suggest you might start looking at revenues from a convention center or from downtown commercial development or from increased activity and job creation with Oklahoma City’s city limits, but that’s just me.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 7

KMT states:

7. The Smaller Projects Will Be Cut First.

Whoever wrote this point must’ve needed filler. How do you pare down a $280 million convention center or a $22 million/mile streetcar system? You do it the same way you eat an elephant: one bite at a time. Ask the Public Oversight Board who has struggled to keep MAPS and MAPS for Kids on budget, even when cost overruns arose and shortfalls emerged. These things happen. You deal with them. At least, you deal with them when you know what you are doing, and this city does. They’ve proven it time and again.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 8

KMT states:


8. A “Temporary” Tax Needs to Expire.

From the KMT site: “If it doesn't expire, it is not temporary. When special interests speak of “keeping the momentum alive,” they really mean “let's not let the tax expire; we might not get it back.” The OKC Elite intend to keep extending the Maps Tax forever!”

First, let’s say it goes on for twenty years, or twenty-five, or fifty. The moment it’s repealed or not reauthorized, it was a “temporary” tax. Who cares, as long as the money accomplished its intended purpose?

Second, if someone really believes that, then why would the OKC Chamber and virtually every other business related concern in Oklahoma City be behind MAPS 3? Do you honestly think they don’t buy things in Oklahoma City? The last line is a classic logical fallacy (when is a fancy term for bull mess). The “OKC Elite” receive an ad hominem attack, and they’re the perpetrators of some vast conspiracy. Anyone who knows a little bit about taxes should understand that this alleged OKC Elite could save a lot of money through various strategies, including relocating somewhere else. They don’t for a reason. They believe in this city, and in its people. If you don’t believe that, you don’t know them. At all.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 9

KMT states:

9. The Economy Continues to Slow. More Taxes Will Make It Worse!

There’s plenty of economic doom and gloom to be found in lots of places, even in Oklahoma City. However, the real axe to grind comes out not by trying to draw conclusions about how flat state economic growth might affect city sales tax receipts. Instead, KMT says, “Taking more money out of the pockets of citizens to fund projects for the OKC Elite is the wrong thing to do at the wrong time. Oklahoma's unemployment is up to 7.2%. Taxpayers need a break! Oklahoma City needs the boost in spending from a tax cut. We don't need more taxes!”

Where to start… Okay, in order:

A. You’re not paying more. You’re paying the same. Don’t attempt to confuse the issue.

B. (sarcasm) The OKC Elite? Really? I guess that’s the same OKC Elite who line the river for aquatics events and fireworks shows. I guess that’s the OKC Elite who would utilize refurbished State Fairgrounds facilities for their gun shows, antique shows, craft shows, horse shows, 4-H and FFA events, and the numerous shows that make our city the Horse Show Capital of the World. It’s the OKC Elite who’ll be the only ones using those Senior Citizen Aquatic Centers and bike trails. And, of course, Larry Nichols needs the combination of MAPS 3 and the TIF district money to make sure his new Devon condo has a really nice front lawn. (/sarcasm)

C. Oklahoma’s unemployment may be 7.2%, but OKC’s is currently estimated at 6.5% as of October. That’s tied with Virginia Beach for the second lowest in the country behind Washington D.C. (see source material here).

D. Everybody always wants to pay less. However, using KMT’s own numbers, we’re looking at an average of $10 a month per person. That’s roughly 33 cents a day. Oklahoma City can have its own Central Park, the beginnings of a rail system, major infrastructure renovations and improvements, and other amenities that will last through most people’s lifetimes, for 33 cents a day for seven years.

E. The impact of that extra $10 a month if it comes off the current tax rate? Probably minimal. Not because of the amount, but because in recessionary periods, tax cuts don’t stimulate the same level of consumption that they do in growth periods. People are concerned about their primary needs, so additional income tends to go into savings or debt reduction. This could be viewed as a Keynesian justification for spending, but it’s more like Friedman’s permanent income argument. For related articles, see here, here, and here.

Rebuttal To Kill The MAPS Tax's Top 10 List: No. 10

KMT says:

10. A New Convention Center Will Not Spur Economic Growth and Recovery. That's Magical Thinking!

The KMT folks state on their website (at least they did on December 3, 2009) that “the proposed $280 million is just little more than half of the projected total costs (website’s emphasis). Consultants estimate another $250 million will be needed to “finish” the convention center complex.” I’m willing to give them the benefit of the doubt, but they don’t cite who the “consultants” are, and where and when they made their cost assertions. That’s a red flag to me.

Next, KMT begins to hang their hat on the studies of Heywood Sanders, a professor of public administration at UT-San Antonio who has long criticized the conventional wisdom of using convention centers as growth engines. They cite his 2005 Brookings Institution study, along with an interview and a fairly even-handed review of his work and critics that makes me wonder if the site’s creators actually read it before posting it. Sanders may have some points to make, but he even admits that the data with which he conducted the Brookings study requires some strong assumptions, inductive reasoning, and fails to account for business cycle fluctuations (see the last article link). It also helps if you don’t mind anecdotal evidence. If you don’t believe me, READ THE BROOKINGS STUDY YOURSELVES. If I thought Oklahoma City was trying to pin its development hopes on a new convention center, I’d be worried as well. The point is that, while the new center is seen as an economic driver, it isn’t primary. It’s more infill and update than anything else. There are numerous structural and technical issues with the Cox Center that prevent it from hosting various conventions. To verify that information, simply contact the Oklahoma City Convention and Visitors Bureau. They have resources galore that I feel confident that they will share with you.

I'm not going to comment on the list's use of a comment post from an online discussion as a supporting authority, other than to question the authority of such a source and to wonder how they discovered the poster's name.

Rebuttal to Kill The MAPS Tax's Top 10 List: Intro

“I can respect someone voting no to #MAPS3, except when their decision rests on ignorance, lies, and bad math. Vote yes.”

That’s how this all began. That’s my quote from Twitter, after reaching my fill on Angus fertilizer about MAPS 3.

While attending a luncheon Wednesday where MAPS was discussed and questioned, Porter Davis, one of the leaders of the efforts to stop MAPS 3, stood up and proclaimed the need for debate about the proposal, while pointing everyone to a list of the “Top 10 Reasons to Kill the MAPS Tax.” I don’t claim for one minute to be someone whose opinion counts more than anyone else’s, nor do I claim to represent any group or concern. I do, however, have a vested interest in honest debate for personal philosophical reasons. Most people who know me would probably agree that a) I tend to voice my opinions in a forceful manner, but b) I willingly concede points that seem logically valid and factually substantiated. I save my attacks for where I feel the truth is being ignored, overlooked, or hidden. By my account, that’s what’s happening within the debate around MAPS 3. I hope this piece contributes to a closer examination of the facts and the arguments.

The loose collective of interest groups against the MAPS 3 initiative has coalesced around the efforts of two somewhat affiliated (or at least similar in purpose) campaigns: the Not This Maps campaign (found at nomaps3.com even though they list their URL as NotThisMaps.com), and the Kill the Maps Tax campaign (found at KillTheMapsTax.com). Some part of the collective attempt to say that it’s merely THIS Maps tax to which they object, while others stress that it is taxes in generally that they oppose. For the purpose of this piece, and because the various interest groups have lumped themselves together, I will do so as well here by referring to them as “KMT” (for Kill the Maps Tax).

Therefore, I present my rebuttal to the aforementioned “Top 10 Reasons to Kill the MAPS Tax”. In the reverse of the order they were originally presented...

Academia vs. Business

Excellent. Courtesy of xkcd.com.

Pitchcamp Slide Deck

OK, I know I've been really late about posting this bad boy, but the past few weeks are nothing but a blur. Here's the slide deck I presented at the PitchCamp during OpenBeta3. If you have any questions or need elaboration, just let me know here or through the i2E website.

JRogers Pitchcamp Presentation Oct 2009

View more documents from jrr2ok.

Big Bang Briefly (Briefly Ep. 01)

Stretch your mind a little with this one. Kudos to Barry Ritholtz over at the Big Picture for posting this first. Amazing little two and a half minute video on how things got started.

Teaching Moments...

Even though I waffle at times, when asked about my favorite band, I generally have to answer Depeche Mode. I recently traveled to see them in Dallas, and was once again blown away, but for several reasons.

I live my life with a soundtrack in my head, and a somewhat cinematic lens through which I view existence. I know, it sounds nuts, but it keeps me (in various scenarios) entertained, engaged, and/or sane.
During the DM show, the backdrop (seen above) utilized a ball in the screen to portray various effects. During "Precious" (until now not one of my favorite songs), the ball became a typewriter ball, like from an old Selectric, and "typed" out an amazing poem that not only clarified the song for me, but reconnected me with this band and its music in a new and profound way. Funny how artists can do that to an audience when all we were looking for was a good time.

I
Have
Learned
So much from God
That I can no longer
Call
Myself A Christian, a Hindu, a Muslim
A Buddhist, a Jew.

The Truth has shared so much of Itself
With me
That I can no longer call myself
A man, a woman, and angel
Or even pure
Soul.

Love has
Befriended Hafiz so completely
It has turned to ash
And freed
Me

Of every concept and image
My mind has ever known.

–Hafiz, Persian poet (1315 – 1390), translated by Daniel Lazinsky.

Today's Words, class...Hubris and Humility

Within the past couple of weeks, I've finished a couple of popular books: Malcolm Gladwell's Outliers, and Jim Collins' How The Mighty Fall. Both are worthwhile reads, but they point to a larger theme that tends to emerge after any crisis, but particularly systematic and cyclical crises. People and institutions tend to get themselves into trouble when their pride passes a certain (apologies, Mr. Gladwell) "tipping point", and the pain is arguably correlated between the altitude from which they descend, the speed of their descent, and the gap between the credit they are due versus the credit they ascribe to themselves.

Oddly, the tipping point metaphor seems appropriate here because sustained success seems to be a balancing act. Humility can hamper one's endeavors if it prevents actions out of a sense of propriety or deferrance or unworthiness. However, confidence can disintergrate into hubris over time, quickly or slowly, leaving individuals and institutions out of touch with the objective world as it is.

Don't get me wrong; I'm not talking about humility as some sort of milquetoast submissiveness. I'm talking about understanding that much of one's success can be credited to fate and timing. Knowing and acknowledging that fact requires one to be diligent and attentive, responsibe to changing circumstances, and above all led by wisdom and facts, never vanity and assumption.

Why Private Insurance Sucks

The Incredibles is one of my favorite movies for numerous reasons. However, today underscores how much reality lies within fiction. In the movie, Gilbert Huph (see photo at right) is an insurance manager who supervises Bob Parr, a.k.a Mr. Incredible.

I am convinced that Gilbert Huph has been cloned and installed throughout the insurance industry.

My family currently has no health insurance. We've been paying out of pocket through a cafeteria plan for the past couple of years since I changed jobs from a large employer to a small employer who merely gives a benefit allowance. Recently, my wife and I decided that time was running out for us and began to plan for another child. We decided to purchase an individual policy for the family, and decided against purchasing maternity insurance for numerous reasons. Still, we needed information to make an informed decision about what was best for our family.

Here's where truth truly mirrors fiction. In the movie, the following exchange takes place between Huph and Bob (dialogue courtesy of Wikiqoute; find the exchange and others here):

Mr. Huph: I'm not happy, Bob. Not. Happy. Ask me why.

Bob Parr: Okay. Why?

Mr. Huph: Why what? Be specific, Bob.

Bob Parr: Why are you unhappy?

Mr. Huph: Your customers make me unhappy.

Bob Parr: What, you've gotten complaints?

Mr. Huph: Complaints I can handle. What I can't handle is your customers' inexplicable knowledge of lnsuricare's inner workings! These people are experts! Experts, Bob! Exploiting every loophole, dodging every obstacle! They're penetrating the bureaucracy!

Bob Parr: Did I do something illegal?

Mr. Huph: [reluctantly] No.

Bob Parr: Are you saying we shouldn't help our customers?

Mr. Huph: The law requires that I answer no.

Bob Parr: We're supposed to help people.

Mr. Huph: We're supposed to help our people! Starting with our stockholders, Bob! Who's helping them out, huh?!

Back to my reality.

When I left my large employer two years ago, I planned on re-insuring myself. However, I could NEVER get a straight answer from ANYONE regarding coverage specifics. Now, I understand each policy is different. I know that companies are reticent about making statements for legal reasons. I get that coverage can vary based on medical history. The problem remains there is ZERO incentive for an insurance company to provide me ANY information that regulation does not ABSOLUTELY require. Consequently, I spent the better part of several months getting stonewalled at every turn, and therefore being under-covered.

After our renewed commitment to get coverage, I went back on the trail. I finally got a lady at Golden Rule, a subsidiary of UnitedHealthCare, to answer my questions. She was very hesitant at first, but when I explained to her that I was likely going to use Golden Rule as my provider, but wanted to clarify some basic concepts about the type of plan I was choosing and general coverage provisions, she proceeded to answer virtually all of my questions and confirm my lay person's translations of her answers.

Having spent time in customer service in a former life, I knew that the most valuable thing I could do to say thanks to the lady who helped me was report my gratitude to her supervisor. So, I asked for the supervisor's name and phone number (since the supervisor wasn't present that day). However, as I've tried to call back, I consistenly get shuttled around through some labyrinthian phone system, where no one's what I'm talking about or volunteers to help me do something nice for someone in a much-maligned industry.

Am I penetrating the bureaucracy? Does that scare them? Does it have no value because it doesn't serve the shareholders' needs?

Based on this, I'm supposed to feel good about a "private" solution to the health care coverage issue? Here's the problem with that: insurance is not a "free market". The policy underwriters do not want to expose themselves, the claims adjusters do not want to cover claims, the legal teams may value calculations about when to pay "go away" money, and there is zero incentive to treat the customer well, especially over the long run (because the longer you're a customer, the more costly your claims are likely to become).

Golden Rule/United, if I weren't a captive, there's no way I'd do business with you. It blows my mind that the same groups that scream "free market solutions" and "let the market decide" are the same firms, the same lobbies, the same industries that hide behind the regulations that prevent free markets from functioning as such. Please just be transparent so that this great free market full of rational actors can make informed decisions. Unless, of course, your great fear is that no rational actor, given any viable alternative, would choose you.

Health Care, Ad Nauseum

As the health care debates ramp up, and the cynics among prepare to have our hopes for some kind - ANY KIND - of solution dashed, patience can really be at a premium.

Greg Mankiw, an economist whom I hold in considerable esteem, posted a piece today examining the reasons why US doctors make so much more than any other doctors in the world. With full credit going to my former college roommate, are we the only ones who see this issue as one created by a false constraint on supply? The AMA governs how many medical schools exist in the US, as well as the class sizes of those schools. Could we simply take the top ten percent of the failed applicants for med school, build some more schools, and increase the supply of doctors, thereby driving down labor costs? If not, why?

Building A Business Plan, Worksheet 5

Here it is, folks, the last worksheet in this initial series of posts designed to get you thinking about your idea as it translates into a business. Of course, after viewing posts on the product or service, the customer, the market, and the business, what else could be left. Oh, right: money.

Money serves many purposes for a business. It's how we "keep score", if you will, regarding how the business is achieving its financial goals (money in excess of costs being profits). It's one piece of how we reward our workers (and ourselves) for hard work and achievement. It provides the raw material for products, services, infrastructure, and human capital. At times, it's manna from heaven. At other times, it's a necessary evil.

**WARNING: PHILOSOPHICAL SIDEBAR**

At the end of the day, folks, money is merely a representation; a shorthand or proxy for value. We can swap goods, services, even body parts for things we want or need (see barter for an elaboration on this). Money, or currency, merely provides us with a benchmark or a common unit upon which to determine the relative value of land, labor and materials (or the syntheses thereof) within The Market.

Here's the point I want to make: many of you may have ideas that have tremendous value to you. That value may be tangible (trading collectibles, especially if you're also a collector) or intangible (providing some type of service or subsidy for a population whose ability to provide for themselves or protect themselves is limited by comparison to others). Those ideas have merit that extends beyond the concept of financial profit (a term often used within social entrepreneurship circles is double bottom-line investing; the UN actually uses the term triple bottom line investing to refer to the benefits of a project to people, the planet and in terms of financial profit). Understand, though, that not all investors view more than one type of return (financial) as beneficial, or even equal in weight or priority. I have my own personal views on this (which I'll share some other time). The point is to recognize that, within entrepreneurship circles, you must be aware of how outside investors (angel investors, venture capitalists, bankers, financial partners, suppliers extending credit terms, etc.) view returns. To most, the most important return/measure of success or viability is financial. Period. That's the rules under which this game is being played.

**END SIDEBAR**

So, understanding that money runs through entrepreneurship in a fundamental way, examine your idea's position by asking yourself:

• When will the company reach break even (in other words, have as much money coming in the door in sales/revenues as is going out the door in costs/expenses)?
• What is the planned “use of funds” from any proposed investment?
• What are the exit scenarios for the founders and investors?

Once you've finished this worksheet (found here) and the other four (see links at the beginning of this post), you've provided yourself with the skeletal outline for a business plan and a pitch. Next time, we'll set up the pitch. After that, the real work begins.

Building A Business Plan, Worksheet 4

I looked up from work yesterday, and yesterday was gone! It's amazing how we can allow ourselves to get so wrapped in our day to day operating that we lose sight of what on it's face is a crucial deliverable. Plans are great, but execution is key.

Luckily, out of errors come learning (and teaching) moments. Out of those moments can come great teams and great businesses. So, not surprisingly (especially for those of you who know me and how I love a dramatic moment and/or turn of phrase), today's worksheet focuses on the business itself. Lots of things make up a business per se, but the focus for our purpose in this exercise rests on these three questions:

• What is it about your management team that makes it uniquely capable of executing on this business plan?
• What are the primary risks facing your business opportunity?
• What proprietary intellectual property does your company use, and what rights do you have to use that IP?

You can find the worksheet with these questions here, and I'm available for comments, feedback and assistance at the email address found here. To review the first three posts in the series, look here, here, and here.

Building A Business Plan, Worksheet 3

Hope everyone had a great weekend living the entrepreneurial dream. The third post in our series deals with an often-mishandled part of the business plan: the market analysis. Understanding what the marketplace looks like is crucial to the success of any venture, but all too often entrepreneurs fail to do the necessary homework to support their arguments that a market entry makes sense. The three leader questions we ask ourselves are:

• What is the market potential for your company’s product or service?
• Who are your competitors?
• What gives your company a competitive advantage?

As always, you can find the worksheet with these questions here, and I'm available for comments, feedback and assistance at the email address found here. If you're just tuning in, you can find Worksheet 1's post here, and Worksheet 2's post here.

Building A Business Plan, Worksheet 2

Those of you who started following this process yesterday with my first post in the series may be saying, "There's got to be more to it than this!" Well, yes and no. Yes from the standpoint that these questions alone will probably not spur sufficient analysis and insight from which to cull a business plan.

However, one of the major stumbling blocks to writing a business plan lies in the actual writing of the plan. That's the reason I've configured the questions I'm asking into printable documents. The physical act of writing down your answers (or typing them in a soft copy; whatever works for you) breaks down the barrier of not getting anything down. There's no guarantee that you will like what you write, or that it will make sense, or that it will make money. I do guarantee, though, that if you write something down, you will have progressed past Square One. That in itself means something.

So let's assume that you've answered the questions from Worksheet #1 about your product or service. No business is viable unless money is changing hands. That means someone must buy your product or service: the Customer. So the next set of questions deals with the most important person in your business, the customer. Ask yourself:

• Who is the target user of your product or service?
• Why would someone purchase your product or service?
• How do you plan to acquire and keep customers?

The worksheet for these questions can be found here. As always, if you'd like some feedback or help once you've answered the questions, feel free to send me your responses at the email address found here.

Building a Business Plan, Worksheet 1

As someone who works with entrepreneurs, I'm often asked for help with business plans. Admittedly, plans take a lot of work. That's part of their value, that they require you to deal exhaustively with the concept you're attempting to bring to the market. However, many people tie themselves in knots trying to eat that elephant in one bite.

At i2E, we use a Commercialization Model that guides business plan construction in terms of the information needed by stakeholders (people with something to lose) at different stages in the Business Lifecycle. You can see the Commercialization Model here.

Entrepreneurs should understand that a business plan helps everyone investing in a project see clearly:

• What's being done
• Why's it being done
• How's it being done
• Who's doing it
• Where are they doing it
• What's the payoff for doing it
• Has you ever done it before?
• Who else is doing it?
• Why you, and not them?

The "everyone" that needs to see this includes the entrepreneur, who could sink a large amount of time and money into a concept that might have fundamental flaws.

Therefore, I've created some short little worksheets for my entrepreneur friends. They are sparse by design, and intended to be filled out either at your computer or by hand. These questions should enable anyone to begin drafting a rough outline for a business plan pitch (our model for a pitch slide deck can be found here). The pitch can then be expanded and supported, thus providing the information for a full business plan(pro forma financials notwithstanding).

The first questions every entrepreneur must ask regarding any product or service are:

1. What problem does your idea solve?
2. How do you solve the problem you seek to solve?
3. What makes your offering different or unique?
   

You can view these questions as a document formatted as a printable worksheet here. If you'd like some help or feedback once you've answered these questions, submit your materials to me via the email address on this page.

Helping Those Who Help Themselves

The National Venture Capital Association is wrapping up its Annual Meeting in Boston today. Anyone who operates with start-up companies knows about the problems facing both entrepreneurs and the investors who back them when it comes to exit scenarios. The NVCA has produced a set of recommendations to help put liquidity and movement back into the system. You can either read the press release or view the slide deck. There's definitely some food for thought here, and it appears to be a good start pointed toward some concrete action.

Additionally, Mark Heesen, NVCA's president, sat down this week with The Deal magazine for a discussion about the industry's issues and plans to evolve, along with some discussion about what with the current administration might entail.

Watch Part 1 here:



Watch Part 2 here:




Discuss, please.

Taking offense vs. making excuses...

Blair over at Imaginative America links to a BatesLine post that he states "makes a pretty convincing argument as to why the legislators that voted against the Flaming Lips are not complete dopes." Complete dopes, no. Spineless literalists, yes.

Taking offense to a rocker wearing a hammer and sickle design on a T-shirt demonstrates a number of points about our state representatives:

1. They were looking for an excuse to pick a "safer" song than one by the Lips;
2. They lack the ability to distinguish between an individual's personal statements (fashion or otherwise) and their artistic achievements;
   
3. They need to pull all of the state's memorials to Woody Guthrie;
   
4. They need to read their Oklahoma history about the legacy of socialism in Oklahoma (especially in the agricultural area of the state; read as MOST OF IT);
5. They pay attention to T-shirt sloganeering;
   
6. They have little to no sense of irony or subtlety;
   
7. They personalize WAAAAY too much.

The final point may be the biggest. Honest and rigorous debate is crucial to a healthy functional democracy. Democracy was in full effect when the people of Oklahoma voted "Do You Realize?" as the state's Official Rock Song. However, a portion of the State House felt the need to negate that expression based upon their assessment of Mr. Ivins' moral validity. Because he wears this shirt, he supports communism. Because he supports communism, he is bad. Because he is bad, everything he does is bad. Because everything he does is bad, if we show an affinity for anything he does, we either endorse badness or we ourselves are bad.

Am I the only person out there disturbed by the inability of our elected officials to separate the message from the messenger? Subtlety and reason apparently don't go far at the Capitol.

Back in the Saddle...

Those of you who've been following my status changes on various social media outlets know that it's been a crazy period for me professionally over the past two months. My bad, nonetheless, on keeping around here. I have a renewed commitment to this site; I will post, I will post, I will post!!! Yes, on a regular basis, too.

The Twitter universe...

Sometimes, silence is golden.

The Financial Mess: People Still Don't Get It

I love Jeffrey Feldman and his blog Frameshop. Feldman does a nice job talking about politics and language, a subject that up until a few years ago was the domain of the GOP (until George Lacoff put out his seminal piece Don't Think of an Elephant).

This brings up a continuing problem: most politicians (of all stripes, but the problem is particularly particularly pronounced among the Democrats and those futher to the left socially) don't understand the worlds of business and finance. I'm not talking about a disagreement between capitalism or socialism/communism; that's not even an argument in anyone's mind who lives in the Northern Hemisphere. I'm talking about the functional understanding of how businesses and financial systems work.

As an individual instance, Feldman wades in and tries to create an issue over counterparty payments on credit default swaps in the case of everyone's favorite bailout recipient, AIG. The problem is that he either has no idea what he's talking about, or he's deliberately framing the issue in a way that casts negative light on AIG and other financial firms for strategic/tactical purposes. If it's the latter reason, I understand. I don't think it's appropriate, and it's hypocritical to engage in the same behavior for which he finds moral fault with movement conservatives, but I understand. However, I feel relatively certain that he simply doesn't understand the why behind counterparty payments. Read my response and position in the comments section of Feldman's original post (I'm jrr2ok, natch) or on Disqus under jrr2ok (which, of course, doesn't integrate with Blogger, but that's a different topic).

Back on board

Geez, I'm sorry, folks. I thought that, at the very least, my microposts were coming through (via Twitter, Ping.fm, and some other mechanisms). Looks like that didn't happen. To catch everyone up, I've been running like a sled dog, trying to keep up with a ton of people looking to start businesses based on technological innovations. Fantastic work, but work nonetheless.

I'm back on the case, I promise.

is prepping for a difficult conversation. Times are tough out there, people.

A-Rod? Chris Brown/Rihanna? Come on, people, buy a priority if you have to...

head hurts from Monday morning valuation work.

Jim is exploring social convergence.

Inauguration Day

I never thought I'd see it happen, but it's here.

No gloating, no hashing up past issues. This is a time of celebration, and a time to prepare ourselves for the work ahead of us. On this inauguration day, focus less on the man, and more on the people for whom he works. Let's dedicate ourselves to spirited CIVIL debate and cooperation, rather than scorched-earth rhetoric and sabotage.

I scheduled my lunch early today to ensure I get to watch the ceremony, even if it's just from my desk. Get more info on what's going on here.

God Bless America.

Freedom Ain't Free...

For those of you who haven't read it, PLEASE read this editorial from the Sri Lanka Sunday Leader by its former editor Lasantha Wickrematunge. Wickrematunge was assassinated January 8. He wrote this column well before his death, and instructed that it was to be published in the event of what he correctly believed to be his inevitable murder.

Sri Lanka's war between the government and an ethnic minority called the Tamils has been going on for 25 years. Wickrematunge was a critic of the Tamils, but an even harsher critic of the government. This is what the press is supposed to do, not report on voyeuristic pop culture nonsense. That stuff has its place, but not in news media outlets of record.

I don't know what's sadder: the papers' focus on triviality, or the public's demand for style and schadenfreude over substance. People in other parts of the world are dying in a quest to bring the public truth. Why aren't we willing to die to read it?

#1 Crush (Harmless Variety)

Little Boots is blowing up the music blogosphere in the UK, and she's getting some good attention over here as well. This video cover of Hot Chip's Ready For The Floor is lo-fi, but totally cool. Anyone who's that cute, that talented, and uses a Tenori-on? Color me cooked.

Big Biz Thinking 101

Barry Ritholtz over at The Big Picture posted a highly instructional Calvin & Hobbes cartoon that sums up the issues with the current bailout.