Kevin V. Michael [dot] com

I remember it like yesterday. I was sitting in my Mom’s store in Antigua, when a cousin’s romantic acquaintance walked through the door. He was young, energetic and possessed a likable personality. He was friendly, respectful and yet at the same time graced the room with an air of self-confidence and boldness. I don’t remember the purpose of this particular visit, but I’d seen him around before. As usual, he was marketing or selling something to which I never paid attention, but the magazine he arrived clutching with a cover photo of the fastest drag racing vehicle on island could not escape my attention. I was curious. I had been to quite a number of races, and at the time it was the new hype. John I Martin and his band of speed enthusiasts had managed to grip the nation with a new form of entertainment, and the Sunday races were all the talk.

Before long we struck up a conversation, and found something in common. He was an Internet entrepreneur of sorts, owner of a website that covered drag racing in Antigua, and to the extent possible, across the region. I told him a knew a bit about web development, and he immediately got excited. Apparently, he saw himself as a business man and coding and design were things that were not within his grasp, so he had been looking for new folks to come on and help with the site.

Looking back, I think that those were the days when telling someone you ran an online business (in the Caribbean especially) made you look like a dreamer, as if you had somehow contrived a way to spend your days idling while appearing to be a legitimate business owner. So to combat the stigma, he inhabited an office. Not his office mind you, but a space in the back of Caribsoft, a fledgling computer systems and accessories retailer at the time. He had no real developers on staff, but sort of worked with someone on a semi paid in cash, semi paid in friendship arrangement. It was obvious, that he wasn’t doing all that great, but I was excited to be a part of a team despite the meager pay.

My first brush with the website was anathema. The content was appealing (pictures and videos of recent races) but the layout and design needed work. I came on working after school, dedicating what little precious time I had to improving the site. After over a year of my involvement it was apparent that the business was a colossal failure and so I bolted. Sadly, it was not the concept that would lead to the untimely end of the business, but rather the execution of the idea by the owner.

I think it would be easy dismiss the guy as inept at running a business, or that he lacked a basic understanding of entrepreneurship, but out of courtesy to an old friend I will give him the benefit of the doubt. In entrepreneurship you sometimes get it wrong, catastrophically wrong even. What is more important as pointed out by my buddy Dr. Randall Pinkett in his bookCampus CEO, is having the ‘entrepreneurship mindset’. As long as you learn from your mistakes and keep on trying, you can never truly be defeated. So let’s talk about what went wrong.

The business model of this company was similar to many entertainment companies today. Keep stock of in-demand content, sell online advertising, spin it off into events, magazines, and other related ventures. Not a bad idea in general, but in this case the execution was fundamentally flawed. Here’s why:

The year was 2000-2001. Computer household penetration in the Caribbean was still growing at a relatively slow rate, broadband Internet connectivity had not yet been introduced, and businesses were still skeptical of the value of an Internet presence. Even if you fast forward to 2008, things have changed, but not extraordinarily so. The myriad of problems in this scenario are self-evident, but I’ll discuss the two most critical factors that we failed to adequately address.

Ineffective Content Channel & The Case of Being Earlier than the Market

It was difficult to provide the content in a convenient way to the target audience. The people attending the races didn’t necessarily have access to a computer, never mind the Internet, never mind at a speed that made the experience enjoyable. Had it not been for the 56K warriors who didn’t mind spending hours downloading a few minutes of video footage, the content may never have gotten out.

The point? You may be unlucky enough to be early in the curve of market acceptance, but re-evaluating what aspect of your product or service is proving to be a barrier could go a long way. In retrospect we may have been better off peddling DVDs. At least we may have been able to build a following that we could take online when the market was ready.

Knowing Your Product(s), Advertising Elasticity and ROI

I know many Internet entrepreneurs think that their website is their product, but that belief is somewhat misleading. Your website keeps your users happy, your users keep your advertisers happy. The point? You have two products to sell. Your website, and your users. A company like Facebook benefits immensely from knowing as much as possible about you. The ability to put your users in a box and cram every microtargeted ad in there with them is important to your clients.

I don’t need to give a lecture on managerial economics for this to be intuitive. Companies spend advertising dollars because they believe it will improve their sales or reinforce their brand. For a web company that depends on advertising revenue, you better have some concrete details on who your users are. If your demographic meets your advertiser’s customer profile and you have reasonable site traffic, you have the makings of a deal. Apparently we missed the boat on that concept. We had a handle on how many hits we were getting from across the globe, but knew nothing about the people visiting the site. The problem was compounded by a skeptical advertiser market with regards to Internet advertising. Granted that the art of online advertising was far from perfected at this time, I feel like we still didn’t provide a compelling pitch that sought to quantify the return on investment our clients would make. In dealing with consumers ROI is usually an esoteric, feel good concept. If your customers are businesses, dollars and cents are the only topic on the table. Ignore this truth at your peril.

In addition to facing unfavorable market conditions, my experience also allowed me to observe some other entrepreneurial mistakes.

Capitalization & Cash Flow

I know you’ve read it before, a large percentage of small businesses fail. There are quite a number of reasons behind the statistics such as lack of knowledge, poor planning, poor execution and the list goes on. I think one of the bigger cardinal sins is to be poorly capitalized. Many entrepreneurs attempt to do too much with too little, and often ignore that in the startup phase there will be months maybe even years before your cash flow goes from red to black. This also goes back to poor planning, but there were many times in our company when cash was tight. Had there been better cash flow estimation and revenue forecasting we may have been able to not only invest in growth opportunities, but pay the bills on time.

Living Beyond Your Means

Within a year after I started working, we had a new office, new computers, new software, and new staff but no seriously viable way of staying afloat. While I was getting slighted on my paycheck, things always ‘appeared’ rosy. Some folks like to have champagne on a beer budget, this was a chronic case of that expression.

IMHO, being a successful entrepreneur requires a grip on reality and a religious avoidance of trying to impress others. In the long term it will do you better to have kept a low profile when things are going well, than to have strutted around like a peacock when times are hard. I am not suggesting that you abandon self confidence, just don’t overdose on ‘the cool’.

..and unless your employees have committed to taking one for the team, you should pay them. Your other ‘possibly desperate’ option would be to offer them a piece of the pie. Just don’t get upset when they start calling the shots.

Having A Focus

Our company suffered from a lack of focus. Before we had even established a solid online presence, we were having drag racing events of our own, while at the same time trying to promote a magazine with little or no readership. At the times I felt that we were running blind, no strategic planning, just a constant rat race for the next thing that would make us money. The lack of dedication to a set vision undermined the company’s ability to focus it’s resources around any sort of measurable goal. Doing too many things at once, is sure to sap away enthusiasm and leaves room for poor execution. You are better off hitting the ball just past short leg and bolting for your life towards the stumps, than to go swinging for a 4 or 6. Set some goals and work towards them, you’ll be better off for it. I promise.

I know this has been a pretty lengthy post though it only pays scant tribute to everything I experienced with this startup. I was only 14 at the time, but the experience has served as a constant reminder of what not do as I embark upon my own entrepreneurial journey.

What have you experienced or witnessed that would make this list pale in comparison? Please share your thoughts.

and it’s something that as an immigrant to the US, I see everyday. I remember one day I was being driven back from lunch by a coworker, and we were discussing the immigrant complex. We were discussing how people who set out from their homelands to America are intrinsically enterprising and determined to make the best of the opportunities that had not been previously afforded to them.

At this junction in the conversation, I rolled down the window and asked him if he saw anything on the stone fences that sandwiched the road.

He responded no.

I glanced again out the window, and there it was in big, bold, imaginary letters; O-P-P-O-R-T-U-N-I-T-Y.

It’s everywhere. That’s why I’m determined to succeed. Do you see it the way I do?

Welcome to kevinvmichael dot com.

For quite some time I have debated whether I should stake a claim in virtual real estate and establish an address in cyberspace for my thoughts and ideas. After going back on forth on it, I figured why the heck not?!?

Had I been more proactive I may have been able to purchase kevinmichael.com, before Kevin Michael (who actually has a pretty decent album) did. When I think about it though, he probably would’ve offered me a couple thousand dollars to inhabit my space, and I would be unhappily moving to this address. A few thousand dollars richer, but unhappy nonetheless. So to be quite honest, I’m happy the way things panned out. I didn’t have to my pack my things and move and on top of that I get to promote my little known middle initial. In case you’re wondering, it’s Vaughn, but I prefer to go by V.

Anyways, enough of the chatter. You may be wondering what the purpose of this site is going to be. If you read the tagline, by now you should have a pretty good idea. I like to tell stories, and most who know me well say I talk a lot. More importantly though, I have a lot of friends, acquaintances, business connections and other categories of connections. I would love to pick up the phone and call each of them, talk for a few hours, get caught up and repeat the cycle at least once a month, but we all know how difficult that is. So here it is, a hyperconnected, available 24/7, life the 2.0 way substitute for a phone conversation. A conversation means the free exchange of ideas so I would love for you to share your thoughts and ideas on this blog as well. Respond to what I write and suggest things for me to write about. That’s the only this way page is going to feel like a dialogue.

In the coming weeks and months I look forward to sharing a story of my exploits in life and business. My goal is to bring as many people I know into the process as a way to build collective knowledge such that everyone benefits.