We all forget too easily: the best startup funding is sales. Sure, angel investment, friends and family, SBA loans, all of those options are necessary for most startups. But sales is better.

If you can, find the early customers. Give them a deal, make them important, work with them to optimize their needs; but make a sale.

Even if you need to go out and find investment — and I speak now as an actual angel investor — there’s almost nothing as convincing as actual sales. People are spending money. It makes a new business proposal far more credible.

True, not all businesses can do that. But a lot of them can. And, as we write about business plans and seeking investment and all, we forget the real sweet spot: finance growth by making the sales.

It’s not that surprising, really; and we’ve seen it before with Facebook. When Twitter released a new feature, and it’s users didn’t like it, they had to change it back.

The Wired Magazine online story is Mob Rule! How Users Took Over Twitter. I found it interesting reading.

For the same kind of thing in Facebook, here’s a link to a Google search for “Facebook user revolt.”

The user revolt is a high-class problem. It’s the trappings of success. It means 1) you have users; 2) they care about what you’re doing with the site they use; and 3) there’s a forum or medium they can use to make their opinions known.

This is a great sign of real success. It’s a problem only if nobody listens.

(Photo credit: Flickr cc, by Daliborlev)

Do you like my headline here, on this post? Can you write a better one?

Headlines are critical. I’ve noted that, with some frustration (I’m not so good at headlines) on this blog before, here.

Headlines come up today because being in New York last week to  judge the Forbes.com business plan contest gave me a chance to visit with my son Paul, who lives in New York, and is CTO of Huffington Post. And he told me what they’re doing on the Huffington Post about headlines.

Why do you care? Maybe because (whether you like its political views or not) in the last 2-3 years Huffington Post has posted huge growth in traffic and advertiser and investor interest and visibility and traffic. So they have to be doing a lot of things right. And, if you’re writing or blogging, you should know about how they do headlines.

It starts with a lot of testing. Paul was quoted in How the Huffington Post uses real-time testing for headlines in Harvard’s Nieman Journalism Lab:

The Huffington Post applies A/B testing to some of its headlines. Readers are randomly shown one of two headlines for the same story. After five minutes, which is enough time for such a high-traffic site, the version with the most clicks becomes the wood that everyone sees.

And then there’s Twitter. As a Twitter user, I enjoyed reading Huffpost crowd sources headlines in Snoo.ws. Here are highlights:

Using the hashtag #headlinehelp, visitors will be able to click on a link to an article and help write an appropriate headline that fits the story. Through social byproduct, the best headline will filter through to editors.

The Huffington Post made its first attempt at using the hashtag late yesterday asking participants to replace the headline, “No, YOU Lie,” regarding a story about Rep. Joe Wilson’s interjectory fireworks during President Obama’s address to a joint session of Congress.

Hashtags are not perfect aggregators by any means, as previous use of them has seen contests hijacked and critical messaging spoiled. With Huffington Post’s reputation, they surely have gained some followers who may wish to use this idea in a negative way for the company.

How cool is that? I’d love to copy that idea. But reality rears up its ugly head: Huffington Post has hundreds of thousands of followers on Twitter; I have barely four thousand. Mine are smarter and better looking, but still …

Or no, perhaps, not so cool? Maybe data-driven headlines are a problem (quoting The Noisy Channel on this subject):

I’m sure this approach must rattle some old-school journalists. And there is a real danger of optimizing for the wrong outcome. For example, including the word “sex” in this message might improve its traffic … but to what end?

OK, good point, but the discovery that there are some words (sex, violence, naked, brutal) which get better results is nothing new. It’s older than I am (I posted about words I won’t put into titles despite the temptation on this blog a couple of years ago).  What’s new is the ability to test quickly and bring a crowd into it in a practical way.

It’s not about asking people what’s new, or changing the news content. It’s about headlines. And gaining readers.

I’ve been a reader of Paul Kedrosky for several years now, so it was a privilege to listen to his 3.5 reasons for optimism last Friday at the Bend Venture Conference in Bend, Oregon. Paul posts at Infectious Greed and appears often in the media.

I admit its sorely tempting, but, after reflection (and some drafts), I’m not dumb enough to attempt to summarize somebody else’s brilliant 45-minute talk into a post like this. However, I can’t resist sharing at least these three high points and surprises.

1. The uninvention of fire

Consider this an opening salvo, which managed to wake up a sleeping crowd at barely after 8 a.m. on a sunny Friday morning. It worked something like a whack on the side of the head. For me at least. And maybe the coffee helped too.

FIRE = finance + insurance + real estate. For a generation or two now, a high percentage of our smartest people have been going from the high-status educational institutions into those FIRE industries. Now, after the fall, that’s less likely. Or so we hope.

2. Those population statistics

I’d heard somewhere that 40% of the people who ever lived are still walking around, alive today. No, as it turned out, or at least Paul K. seemed convincingly sure of himself as he said it, only 8% of the people who ever lived are alive today.

However, 50% of the lawyers who ever lived are alive today. And 75% of the scientists and engineers are alive today. You decide: good news, bad news, both? Which is which?

3. BioTech as attractive nuisance

Happily, the key visual on this theme is available here on Infectious Greed. It’s a very powerful image, showing that investment in BioTech hasn’t yielded a proportionate amount of new discoveries. I hadn’t heard the term “attractive nuisance” before, but it fit the context pretty well.

Accents, real speech, figures of speech, colorful speech. Expressions. The way we use language fascinates me. I wonder if technology changes it?

I have questions:

• Why is groovy so hideously and embarrassingly obsolete, but cool is still cool? Am I the only one who still likes Paul Simon’s song, Feelin’ Groovy?



• Why does just sayin work so well, especially in Twitter, to smooth out rough edges, frame thoughts, and soften things? It’s almost like a Photoshop effect to make a photograph look like a painting. I don’t get it. I mean, I’m just sayin.
• And why does is it just me seem to flow so well, almost like just sayin, as a statement softener?
• How do you pronounce LOL? Can you use it outside of instant messaging and/or Twitter? Is it okay in normal conversation? And what about WTF and OMG, both acronyms using single-syllable letters instead of single-syllable words. I think I know the answer to that one. Not that there is a single right answer. BTW, I liked it when my daughter was studying in Madrid, and came up with QTF. Although I hate the F part of that.

And also, some simple observations, about language in my lifetime, and how it’s been changing.

• I love the way Spanish has grown and prospered inside our modern American English. Starting with simple expressions like nada and the whole enchilada, there’s Spanish all over the place now, and I, for one, love it. I think it’s a living example of the kind of natural change that brought French into English a few centuries ago, and that gave us, gradually, the English we speak instead of the English they spoke in Shakespeare’s time. I like to see that living change. And I like it that it’s happened before. Deja vu. And here’s a test of popular culture: can you say deja vu without adding the Yogi Berra addition, all over again? Nobody seems to use the naked deja vu expression anymore. It’s verboten.
• I hate the expression that something sucks, meaning that it’s bad. Do you know where that expression has been? And if you don’t, I warn you, don’t ask anybody who was a boy in the 1950s or 1960s. And then there are those related expressions, like bite me, or it bites the big one. Not good. It’s weird, to me, that these are now commonplace, and accepted by picky censors, like on network TV.
• And, speaking of what’s acceptable on network television these days, I kind of like what Jon Stuart and Stephen Colbert have done with the beeped-out expression. Have you noticed how well they both use that? This stuff can be overused, but still, language and expression prevails.
• And all the cleaned expressions, like bleeping and fricken, [Ed. Note: and the popular (among sci-fi fans) frak from the Battlestar Gallactica TV series].
• Is it possible that all of the silliness related to code works and acceptable and nonacceptable has contributed to the twisting and distortions?
• Which reminds me, the overuse of certain words becomes just silly. I listen to people on a bus unable to say a simple sentence without adding fuckin after every three words. What’s up with that? Doesn’t it get in the way? I think an actual conversation with all that extra burden would be exhausting. Do they even hear it?
• I suspect that the worst language anywhere in this country, in terms of supposedly swearing and foul words and such, is found on the elementary school playgrounds, particularly where the fourth-sixth grade boys are playing?

I’m just sayin.

Here I was writing this post about new FTC rules for social media, feeling self-righteous about it, when it occurred to me that Shutterstock.com gives me a free stock photos account, which I use to illustrate this blog. And I’m an Amazon.com affiliate. I accept review copies of books, some of which I’ve reviewed here (although I bought most of the books I’ve reviewed, and I don’t go around asking for review copies, just accepting them, occasionally, when they’re offered). And I’m an employee of Palo Alto Software. So I don’t want to be a pot calling kettles black. Or a wolf disguised as a sheep.

Still, it’s about time. A new Federal Trade Commission (FTC) ruling aimed at blogging and, I assume, Twitter starts Dec. 1. This is from the New York Times story on it:

Beginning on Dec. 1, bloggers who review products must disclose any connection with advertisers, including, in most cases, the receipt of free products and whether or not they were paid in any way by advertisers, as occurs frequently. The new rules also take aim at celebrities, who will now need to disclose any ties to companies, should they promote products on a talk show or on Twitter. A second major change, which was not aimed specifically at bloggers or social media, was to eliminate the ability of advertisers to gush about results that differ from what is typical — for instance, from a weight loss supplement.

I’m glad they made it specific. I hope they enforce it. The same general idea was previously built into basic journalism ethics and it should have been obvious that it applied here as well. Ethics? I mean what do you think, when people are paying people to blog about their products, tweet about them, and do reviews on social media sites. Making endorsements look like honest opinion, or reviews pretending they’re objective, is ugly. I hope it’s obvious why.

What if some company offered to pay you under the table for talking it up with all your friends? How would you feel to be a walking talking advertisement parading as a person?

But it happens all the time. I got an email last month offering me money to endorse products on this blog. It was blatant and unembarrassed. The offer to shill for money was couched in terms like “business models” and “revenue streams.”  But it was pretty simple: if I would endorse products in my blog, they’d pay me. No, thank you.

Time magazine’s last issue included a story called Brought to You by Twitter, about tweeting for money:

A company called Izea, which made its name connecting bloggers with firms willing to compensate them for plugs on their blogs, has set up a similar service for the Twittersphere. At a site called Sponsored Tweets, Twitter users can sign in, set the price they want companies to pay them for tweeting an ad on their behalf and wait for the offers to come in. Jocelyn French, the mother of a 2-year-old boy and 1-year-old girl, has tweeted for a parenting website, a college-information site and Kmart, among others, at $1 a pop. “I figure, hey, why not get paid at the same time?” French says. On average, companies are paying Sponsored Tweets users $29 per tweet.

I hope you see the problem with that: first, it’s dishonest, the wolf in sheep’s clothing, because it’s presented as conversation.

Back in the 1970s when I studied Journalism in grad school, the generally accepted ethics were pretty obvious on this. Disguising ads as editorial was clearly out of bounds. But that was way before Amazon.com revolutionized consumer reviews, and then there was the proliferation of blogs and now Twitter blurring the boundaries. But still, put it back onto the personal level: if a company pays you to pretend you’re giving a legitimate personal opinion, that just doesn’t feel good. Right?

(Photo: Sarah Heinman/Flickr)

How do you react to this quote? This is Mark Shaeffer about social media experts, in this post. I quoted him in my post here yesterday:

How many have ever had a real sales job or have been actually accountable for delivering new value in a marketplace by creating, testing and distributing a product on a meaningful scale?   Very few.  Yet these are our marketing “gurus?”

Now wait a minute.

Who says marketing experts have to have sales experience? Why do they need to have been accountable for a new product?

I want my experts smart, experienced, and knowledgeable. I want them to listen. I want them open to new ideas. I want them to give good advice.

But I don’t care if they’ve had sales responsibility; or if they’ve launched a new product. Why should I?

Do I care if my doctor has built a house? Do I care if my accountant can sing? Why do I want experts to be managers?

What about you? Do you think a business expert has to have line management experience? Can a single-person expert really be an expert if he or she hasn’t run a company?

Do you think the best programmer makes the best manager?

“Line vs. staff” was a big deal to multinational executives and managers I consulted for in the 1970s and 1980s. As a consultant and newsletter generator, I was staff. Line managers had responsibility for sales numbers or profitability. And they were proud of it. It was important to their career.

Does that still matter? Or is it confusing makers and managers? And don’t the experts have to close some sales now and then to survive in business?

Not that the idea threatens me at all – I’m safe on this respect, since I’ve built a company, based on my own software, so whatever expertise I claim will pass that “sales or new product” test.

It’s just that experts and managers are like apples and oranges. Different skills. I want managers to be managers, and experts to be experts.

———-

Late addition: I had the above post ready to go when I was dealing with comments from yesterday and picked up Chris Brogan’s defense, here. He picked up on the same underlying assumption:

Have I held a sales job in a big company? Hell no. I’m not a salesman. Instead, I’m someone who equips salespeople with new tools to drive to value. I’m a hell of an opener, and decent with the first 2/3 of the cycle, but if my kids had to eat on my ability to close complex sales? Hell no.

Interesting perspective. Can you trust me? Beats me. I’ll let my work stand for itself. : )

No argument from me there.

(Photo credit: karbunar/Shutterstock)

I was just getting back to the office yesterday, a Monday morning after a week away – 4 days of business, and 3 relaxing and invigorating days in Yosemite, which is really away — when Dan Levine (@schoolmarketer on Twitter) suggested I read The social media country club on Mark Shaeffer’s businessgrow blog.

Yes, I’m a sucker for contrary points of view. Get a group going, approach consensus, and I want to read the one who’s out in left field. If everybody else is right and this one’s all wrong, so what, I can work that out. But then how often is left field the right place to be?

Mark starts out objecting to rave reviews of Trust Agents, the book by Chris Brogan and Julien Smith. It’s subtitle is “Using the Web to Build Influence, Improve Reputation, and Earn Trust.” I haven’t read it, but I’ve read a lot of favorable comments. Mark, however, says those favorable comments are the result of group think and myth making:

The “thought leaders” of social media marketing are a country club fearful of saying anything negative or controversial about another club member. The real commerce of social media is trading favors and a negative comment breaks the favor chain.

He paints a picture a lot like the fable of the emperor’s new clothes. You can see with this quote, under the general heading of credibility, that at the very least he’s making his position clear:

Take a close look at the credentials (if you can find any) of nearly any leading social media marketing “expert.”  How many have ever had a real sales job or have been actually accountable for delivering new value in a marketplace by creating, testing and distributing a product on a meaningful scale?   Very few.  Yet these are our marketing “gurus?”  In a communication channel already dominated by porn-peddling, get-rich-quick nimrods, it simply doesn’t help our collective credibility to have our most visible advocates spouting incredibly naive statements about marketing fundamentals they know little about.

I don’t know that I agree; it seems too harsh to me. I don’t think expertise is measured only by job history, or sales history, or middle management in a big company history, which seems to be laying just under the surface of the blogger bashing. And I wish Mark had said which statements in the book are naive. But it’s certainly a very contrarian point of view. And worth considering. So I’m sharing it here.

(Photo credit: STILLFX/Shutterstock)

I’m a bit off my normal thought patterns today, waking up in a generic freeway-exit hotel in the California Central Valley, headed for Yosemite National Park with my youngest daughter.

Yosemite means a lot to me. My dad took my brothers and me there many times when we were growing up in the San Francisco area. As a teenager I went backpacking into the Yosemite high country every summer. Later on, my wife and I took our kids up into the high country every summer. That first picture is me with our three oldest in 1980, on the shoulder below Half Dome.

I’m very much looking forward to the Ken Burns series on National Parks starting this month on PBS. He calls it “America’s Best Idea.” I second that. I’ve lived in Mexico and Austria as well as the U.S., and I’ve traveled to dozens of countries, but I’ve never seen anything like our own national park system. It’s a great privilege to be able to hold the polluting effects of civilization at bay in some of these great parks. Poor Mexico, my country-in-law, has tried hard but is just economically unable to hold back the tide, even though it has some natural beauties that truly deserve it. Too bad. Let’s be grateful for what we have. The website for the Ken Burns series says tell your story; and this is mine.

The second picture here is our family plus pack burro  on the far side of the river campsite at Little Yosemite Valley. That was in 1988. They used to rent pack burros in Yosemite for use by families and groups going out into the high country. We’d rent a burro for $15 per day and relieve ourselves of actually packing the stuff on our backs, which made it possible for a family to make a 4-5 day trip up into the mountains. My wife made those high-country trips into great family vacations. And we were always broke, so the $15 a day lodging cost was attractive. They don’t do that at Yosemite any more, because of problems like insurance, and people not respecting the implied privilege. And that’s too bad.

I’m particularly excited today because I’ve missed Yosemite since we moved to Oregon 17 years ago.  I do get into the Oregon Cascades a lot, but I’ve missed Yosemite and I’m anxious to visit again.

This last photo, taken above Nevada Falls in 1980, is of our three oldest children, now 37, 35, and 33 years old. I can’t say that I would be looking forward to backpacking tonight (we have a hotel room reserved) but I am very glad we were able to do it when we did. And very happy to visit again, later today.

Photo credits: first one by my wife Evangelina Berry, second by some teenage boy who was talking up our teenage daughters at the time, third one by me.

Blog names and titles: do you agree that some are better than others? Lots of blogs have succeeded with titles that are merely descriptive, not remarkable: Seth’s blog, Small Business Technology, Escape from Cubicle Nation, and many others.

Browsing around the other day, I discovered a Jay White who calls his blog “Dumb Little Man.” That’s a great example of a creative title that’s very easy to remember, recognize, and not misspell. It’s at dumblittleman.com of course. I liked him even before I started reading the blog.

I posted last January about Gardening Nude, a good blog with undeniable search engine power. And Jeff Atwood’s Coding Horror, obviously for programmers. Freakonomics, Women 2.0, Duct Tape Marketing, and Lifehack, to mention some more. These aren’t just good blogs, they’re remarkably good names for blogs.

What amazes me is how these blogs with great names beat the chicken and egg problem: a blog isn’t really taken seriously until it has a few hundred posts, but it can’t have the posts first and then figure out the name. With some rare exceptions (Freakonomics, for example, was moved to a different Web address when it moved to the New York Times) the name, including the domain name, has to come first. In some cases (as with Escape from Cubicle Nation, Duct Tape Marketing) it either starts with a book or becomes a book. In any case, my congratulations for doing it right.

This is a good reminder about a lot of names in business: business names, product names, for example: they’re tough to change, once you’ve started; but hard to get a really good one to start.

(Image: tkemot/shutterstock)