When you really think about it, a lot of the somber pomp and circumstance surrounding funerals is a little strange.  For most funerals, a dead body is pumped full of toxic chemicals to preserve it, paraded in front of loved ones, piled into one of the strangest-looking cars in existence and then laid to rest in a hole in  the ground in a large field of dead people.  Not only that, but the whole affair usually costs the relatives around $5000 dollars.  Well it turns out that pretty much all of the minutia of funeral rites has a long and storied history about it… and plenty of businesses willing to charge exorbitant amounts of money to send loved ones to the afterlife in style.   
 

The Wake

Image Source

  
 
Also known as the creepiest part of any funeral, the wake occurs shortly after death.  The recently deceased is placed on display, often with the casket open.  Loved ones are given one last chance to say their goodbyes, kneeling by the pasty, makeup-caked face of the dead.  In the past, wakes were conducted inside the house of the deceased, often as an informal ceremony before burial.  Nowadays they take place in funeral homes, with prices tags ranging from a hundred to a couple thousand dollars. 

The tradition of the wake dates back quite far, at least to medieval times, and shows up in many cultures.  The idea is that loved ones keep watch over the body shortly after death in the hope that the person would wake up, presumably because fear of being buried alive is one of the most widespread phobias in the world.  Contrary to what you might have heard, the name “wake” doesn’t refer to the dead person “waking” up, but is actually an archaic usage of the word that means “to watch”, referring to the loved ones guarding of the body after death. 

Flowers

Image Source

   
Sending flowers to those grieving a loved one has become so ubiquitous that many funeral announcements have an “In lieu of flowers” section, instructing mourners to give donations to a charity, for example, rather than bring flowers.  They are likewise on ubiquitous display during the funeral, draping the coffin in amounts that greatly exceed the size of the body contained therein.  Between mourners and those planning the proceedings, funerals have to finish second only to weddings in amount spent on flowers in a single day. Many wakes have a room filled to the ceiling with flowers.

Yet another tradition that dates back millennia, flowers have been found in burial pits from pre-history.  So why were they there?  To ward off evil spirits? To remind us all of the impermanence of life, wilting as it does like a flower?  Well actually, the answer’s a lot more practical than all that: corpses stink to high hell.  After only a few days, any dead body will start to reek with utter putrescence, so it quickly became commonplace to drape the body in as many flowers as possible to cover the stench.  Thanks to modern embalming techniques, the flowers are now purely for show.  It gives new meaning to the tradition of a procession of loved ones each placing a flower on the casket — instead of a fond farewell, they’re actually saying “dude, you reek.” 

Caskets

Image Source

  
In case you haven’t had the pleasure of experiencing a dead body in person, or you didn’t have a bitter, overly-verbose Vietnam vet for an uncle: they kind of stink.  A lot.  Much like that casserole you left sitting out all night, people have been putting corpses in the tightest, most air-tight boxes they could find.  The idea is that a body exposed to the elements doesn’t really stand up to display for long, nor does anyone want to be anywhere near it to say the eulogy.  Really important people usually get a royal treatment for their casket, but for your average commoner it was just whatever was lying around that would keep your corpse palatable until they threw you in the ground. 

Modern caskets, not so much.  They’re often made of many layers of steel and could probably survive a nuclear holocaust.  While the desire to prevent zombies from clawing their way out of the ground is noble, what’s not so great is these behemoths often cost upwards of a cool grand and are easily the most expensive part of any funeral.  Overall, they’re just for show. The body will rot regardless and a wooden casket is just as effective as a bejeweled one.

Tombstones

Image Source

 
There are few things more iconic about modern burial rituals than the tombstone.  Walking the grounds of Arlington National Cemetery is quite humbling, to say the least.  But, believe it or not, throughout history, tombstones weren’t actually that commonplace.  It was the rites leading up to the burial that were important, and unless you were wealthy enough to afford a mausoleum, you likely ended up with a few rocks on your burial site and not much more.   

Still, there’s a long, proud history of putting rocks on graves.  Back in the day they were called “Cairns”, and they’re the precursor to modern headstones (though cairns, meaning basically a big pile of rocks, have been used for many other purposes, such as trail markers).  The reasons behind these piles of stones were twofold:  First, people were often buried with some form of valuables, even if it was just a few pieces of jewelry.  A big pile of stones, or one big stone, was often enough to keep grave robbers from digging up the corpse.  Second, animals have an annoying habit of digging up fresh corpses that aren’t buried deep enough; the stones helped prevent the body from being disturbed by man or beast. 

Modern headstones seem to mostly be a reminder of where the grave is to grandchildren that will never visit as well as exercises in vanity.  And they can be an expensive one at that.  Like caskets, even a modest one will set you back a few hundred dollars, with virtually no limit on how much they can cost—depending on how much you want to remind future generations of how obnoxiously large your ego was. 

Funeral Clothing

Image Source

  
Funeral clothes aren’t really as big of an issue now as they were in the past, owing to the fact that grieving processes are much shorter in the 21st century.  As recently as mid-century, mourners—especially immediate family—were expected to don a whole set of specific clothing to indicate that they were in mourning.  Even today though, how many of us would have to rent or borrow something formal and black to wear to a funeral?  But according to experts, funerals a generation or two ago and going back to antiquity required a whole new, expensive wardrobe upgrade. 

While it makes sense that you don’t show up to a funeral wearing a rainbow wig and sweatpants, it seems a little strange that you will get the meanest old lady glares in your entire life just by wearing navy blue instead of black.  To put it simply, ancient peoples were terrified of dead bodies and death in general.  Wearing a specific dress was meant to conceal mourners from the evil spirits that had taken the deceased’s life.  So sort of like Halloween but with more drinking.

Those trying to start their own business love looking to other successful entrepreneurs for advice and guidance. It’s only natural to expect that someone with infinitely more success than you would have something intelligent to say, but emulating that knowledge may not always be the best idea. Here are the pros and cons of 13 business tips provided by famously successful entrepreneurs.

Andrew Carnegie

Image Source

“And here is the prime condition of success, the great secret. Concentrate your energy, thoughts and capital exclusively upon the business in which you are engaged in. Having begun in one line, resolve to fight it out on that line; to lead in it. Adopt every improvement, have the best machinery and know the most about it.” – Andrew Carnegie

On one hand, this is a great (albeit somewhat obvious) piece of advice. Being the leader in whatever niche your business specializes in is always the ideal. Having the most up-to-date equipment (and being able to use it well) is one thing that keeps the business ahead of the curve, and ahead of everyone else.

However, sometimes knowing when to stop is important as well. If you’ve invested millions of dollars in something that’s only seen a profit of one or two million over the course of many years, it may be time to stop spending money on top of the line equipment or new ‘improvements’.

Thomas Edison

Image Source

“I never perfected an invention that I did not think about in terms of the service it might give others… I find out what the world needs, then I proceed to invent.”
- Thomas Edison

Edison was a nice guy and a genius. Many successful business owners are neither. Although this outlook is both progressive and one that drips of success, being an evil greedy person can be pretty lucrative as well. If you’re too stupid to think of something that would perform for the betterment of society or improve people’s lives even in a small way, you can always own a Burger King franchise or leverage the insecurities of the American people (i.e. being a life coach, selling counterfeit diet pills), to make a decent amount of cash.

Harvey S. Firestone

Image Source

“Capital isn’t that important in business. Experience isn’t that important. You can get both of these things. What is important is ideas.” – Harvey S. Firestone

Indeed, ideas are essential to a great and incessantly thriving business. Just look at Apple: they had the ideas for all these great products, which were created and in very high demand. Then, they had the idea to release ‘versions’ of each product, trickling out new features which should have been in the original versions but were withheld in the name of making more money. On top of that, they have specially designed each product to malfunction or break entirely within just a year or two of purchasing it, forcing the buyer to pay for repairs or spend hundreds of dollars on a completely new whatever-it-was that broke.

On the other hand, ideas can be totally unimportant if you don’t have money or a track record of success to back them up. Just look at Creaky Boards and every other independent artist who ever had a song stolen. Then again, we’re talking about business and not music. In that case, there are always cases like Urban Outfitters consistently stealing other artists’ designs for their own shirts. This is only a small example of larger businesses crushing their competition by simply stealing from them. In the American justice system, the one with the most money usually wins.

John H. Patterson

Image Source

“To succeed in business it is necessary to make others see things as you see them.” – John H Patterson

It’s true, but Patterson left out the idea that a successful business often convinces people to believe or agree with something that doesn’t reflect the values or beliefs of those selling it at all. People are constantly bombarded with ads that sell the idea of happiness through consumerism. Stay connected 24/7 (every moment ever) with AT&T and stay happy. Losing weight can be fun, easy, fast, and you can still eat lots of cake while you do it! Using this Neutrogena age-defying cream will make you look younger and less wrinkly, which will make other people less frightened to speak with you, increase your self-worth and decrease your fear of leaving the house. By the way, McDonald’s is now serving ‘healthy’, ‘fresh’ smoothies and salads!

Bo Bennett

Image Source

“For every good reason there is to lie, there is a better reason to tell the truth.” – Bo Bennett

This is simply not always true. Sometimes lying can help you untie a knot you’d rather not cut, and sometimes it’s just easier to avoid hurting another person’s feelings. Lying can also be helpful in legal matters, such as when you stab your ex-wife to death but also really want to continue trying to further your athletic career.

Zig Ziglar

Image Source

“Success is the maximum utilization of the ability that you have .” – Zig Ziglar

Sometimes, the maximum utilization of the ability one has is just being a general failure. Unfortunately, not everyone was born with the potential to be great. Some people are crappy at just about everything. It doesn’t mean they shouldn’t try to be successful or do what they like. Then again, Ziglar did say that success was doing the best you can, and not necessarily being any good at it.

David Ogilvy

Image Source

“In the modern world of business, it is useless to be a creative, original thinker unless you can also sell what you create.” – David Ogilvy

Of course it makes things a whole lot easier if a person can successfully market and sell their genius idea or product. However, it shouldn’t be discouraging if you’re an idea person without a lot of strength in sales-related areas. Finding a partner can be extremely difficult because people tend to be invested in themselves more than any business venture, and trusting as well as depending on another person to pull their weight can be a scary and sometimes disastrous thing. But once a reliable partner is found, it can be the most valuable relationship those two people may ever discover. If the two hands can create a machine in which they work simultaneously, one supporting the other, both depending on one another to move smoothly and successfully, the business can be unstoppable.

Lauren Amarante

Image Source

“If you’re not in an uncomfortable situation every single day, then you’re doing something wrong.” – Lauren Amarante

A successful business is forced to deal with many obstacles. While the concept of this quote — and of dealing with unhappy issues head on — is clear, it’s also okay to have a day or two pass without an intermittent desire to ram your head against a wall. Some days can be good, but most should be beneath the weight of solving new problems and expanding the business, which can be an issue in itself.

Juliette Brindak

Image Source

“If you can find people who think that what you’re doing is great, they’re going to do everything in their power to make it a success.” – Juliette Brindak

A great team is a team that believes in your business in the way that you do, and therefore feels invested in enhancing its success. Employees, investors and friends are much more likely to help you and your business if they think it’s a really great idea with a lot of potential. At the same time, be careful who you trust with more personal details and don’t be too eager to give away responsibility to a party just because of their enthusiasm; do background checks, get to know people, and feel comfortable trusting them first.

Confucius

Image Source

“Choose a job that you like and you will never have to work a day in your life” – Confucius

You may love your job so much that you never even think about pursuing anything else, ever, but doing something that you genuinely love doesn’t cut out the unpleasantries of work. Especially in a new business, the business owner will have to conquer tasks they really do not like. Part of being successful is having flexibility and the willingness to put time and effort into all aspects of a project — whether you like them all or not. Besides, resolving to dedicate time and effort to unappealing tasks can only strengthen your knowledge and ability.

Will Smith

Image Source

“Being realistic is the most commonly traveled road to mediocrity.” – Will Smith

Yes, refusing to use your credit card for the sake of your business because you won’t be able to pay it off right away may be a boring choice that requires no risk and, therefore, has no big payoff. Denying your business other things it may need to stay ahead of the curve for the sake of money or staying low-risk is not going to end in a multi-million dollar payoff. However, it is sometimes a better idea to be ‘realistic’ rather than blow all your funding on a genius whim, or rashly investing in a last-minute chance that would have waited while you got a little more educated about it and the stipulations surrounding spending that money.

Zig Ziglar

Image Source

“Money won’t make you happy… but everybody wants to find out for themselves.” – Zig Ziglar

Just tell that to the millions of poor people who slave away on minimum wage jobs, sometimes two or three at a time, whose meager salaries hardly support their families. The concept of this quote is solid: don’t have money be your only goal. Having a lot of money but being forced to do something you hate isn’t going to make you happy, and money as the main objective doesn’t exactly make a productive work environment either. While keeping that in mind, it’s also important to note that money would definitely make many unfortunate people a lot happier for the simple reason that their quality of life would improve from struggling to making ends meet.

Jack Ma

Image Source

“Forget about your competitors, just focus on your customers.” – Jack Ma

He has a great point. Customer service is key. When a customer has a great experience with your business, they’ll want to share that information with their friends. Word-of-mouth is the most valuable type of advertising there is; firstly, it’s free. Second, no one trusts billboard ads, commercials, or catchy taglines as much as they do their own friends and families.

However, it’s also important to consider your competitors. Looking at what they’re doing may give you new ideas about improved products, let you see what has already been done, what works and what isn’t working. You can look at their customer service ratings and see what people do and do not like about their services. Although it won’t solve all your problems and copying another company is definitely not the idea, examining the competitors can give you important insight and help you to avoid certain mistakes before you make them.

However, major corporations and companies are also engaging in the open source development process. This process is known for its group collaboration efforts, with many different developers working on a single product or software. The end result is often much more successful than those with only a few developers working on a project.

Here is a look at some major corporations that have embraced this development philosophy with very successful results.

Procter & Gamble Co.

Imagine a world-renowned company changing the way it conducts its research and development processes. Procter & Gamble, one of the largest corporations in the world did just that. The company moved from a traditional research and development style to one that follows the open source strategy. Interestingly, Procter & Gamble calls this new strategy “connect and develop.” Following the lead of the open source initiative, the company is reaching out to the collective minds around the world. One of the goals of this new initiative is that 50 percent of the new products in development must come from sources outside of its own laboratories.

BMW

BMW Group embraces the open source development theory within its new car development projects. Team members, who can number in the hundreds, are gathered together from their home bases to work at BMW’s Research and Innovation Center. These team members include personnel from wide ranging departments including design, marketing, purchasing and others. These team members then collaborate, sometimes for as long as three years, to develop and create the new car’s prototype design. These sometimes disparate-thinking groups collaborate in an open source environment, trading and sharing ideas, all with the end goal of creating the very best new automobile design.

Southwest Airlines

Southwest Airlines recently gathered team members from across the company. These included employees in dispatch, operations, flight and crew members and others. This group was asked to come up with a set of changes that could be implemented to create changes in the airline’s operations.

Eventually the group came up with 109 ideas that were then presented to upper management. Tom Nealon, Southwest’s chief information officer stated that there was a diverse group of people working on this crucial project. He also indicated that because some group members asked questions that might seem rudimentary to others, the group actually had to do a much closer examination of their ideas and solutions. It made the group challenge themselves to look at the big picture from a different angle.

The idea of group collaboration has worked for many years with in the open source software community. Now more and more large and small corporations and companies are embracing this philosophy with some amazing results. By proof of these three examples, they are met with great success and acceptance.

This is a guest post by Robert Jordan.

Want to know how some of America’s most successful entrepreneurs made it? Here are some jolts of inspiration and shots of courage for new business owners, gleaned from interviews with 45 of America’s leading company founders.

Too little funding forces discipline.
The upside of having too little funding is that your business can grow organically, and you’ll stay very focused on making a profit and positive cash flow.

Always have a standby investor.
No matter how much you like each other, and how much time and effort you’ve invested in negotiating and paperwork, large financial partnerships can – and often do – fall apart last minute.

Create a business plan that’s a selling tool.
Venture capitalists look at hundreds of prospects, so your business plan has to be clear, credible, and able to demonstrate in 10 minutes or less your dedication to solving a crucial problem.

Be honest in all your dealings.
Running a business is no different than running your life. Founders should be honest in their dealings and in their assessments. Always look at facts, because facts don’t lie.

Start with what you have.
If you wait for the perfect solution to come along, you’ll never get your business going. Assume that the right tools, systems, and people will come along to refine it.

Make your employees shareholders.
When employees have a sense of ownership, it creates a kind of self-enforcement process. Give stock options to everyone at your company – all the way to the janitor. Owners think differently than employees.

Fail fast.
What doesn’t work, throw away, and what does work, run with it. Knowing what’s going right and what’s going wrong – and doing something about it quickly – will put you at the front of the class.

Be willing to tweak your idea.
If you fall too much in love with your idea, you won’t have the capacity to take feedback from other people and from the market. The idea you start with is unlikely to be the exact idea you’re going to win with.

The above tips have been adapted from Robert Jordan’s new book, “How They Did It”, and these were the minds behind the advice!­­­­­­­­­

1. Viresh Bhatia, InstallShield
2. Jim Dolan, The Dolan Company (DM)
3. Donald C. Harrison, AtriCure (ATCR)
4. Mark Tebbe, Lante Corporation, Answers.com (ANSW)
5. Howard A. Tullman, Certified Collateral Corporation (CCC), Original Research II Kendall College, Experiencia, Tribeca Flashpoint Media Arts Academy, The Cobalt Group, Tunes.com
6. Dane Miller, Biomet
7. Scott Jones, Boston Technology, Gracenote, ChaCha, Precise Path Robotics
8. Steve Shank, Capella Education (CPLA)

Official bio: Robert Jordan has been launching and growing companies and helping other entrepreneurs do the same for the past 20 years. He is author of How They Did It: Billion Dollar Insights from the Heart of America (RedFlash Press, www.HowTheyDidItBook.com), a collection of interviews from 45 leading founders who created $41 billion from scratch.

After 7 years in business, VOIP company Skype has filed for an IPO. InformationWeek has more:

The Luxembourg-based company said it expects to sell as much as $100 million of depositary shares held by existing owners.

Zennstrom and co-founder Janus Friis then filed litigation against eBay, which had failed to acquire key Skype software when it purchased the VoIP company. The litigation was settled when the Skype founders received an undisclosed amount of Skype equity. Now, they stand to cash in again because of the IPO.

Cool IPO, but don’t the majority of Skype users use it for free? TechCrunch’s Erich Schonfeld has more numbers:

As of June 30, Skype was averaging 124 million users a month, with only 8.1 million (6%) of those paying users (out of a total of 560 million registered users). Those users, however, pay an average of $96 a year. Skype’s strategy is to keep growing its overall number of users and convert more of them to paying customers.

Develop new monetization models, including advertising. Our users made over 152 billion minutes of Skype-to-Skype calls in the twelve months ended June 30, 2010. We believe this represents a meaningful opportunity to increase our revenue from alternative monetization models, including advertising, gaming and virtual gifts.

Focusing more on business users might also prove lucrative for Skype. I wonder if this IPO will lead to another hot tech stock, without the sustainability.

What you won’t learn so quickly is how to make it in the freelancing world. Besides having the right contacts, you need to build repeat clients, constantly promote yourself, keep your books straight, and, oh yeah, do excellent work while you’re at it.

We’ve compiled 50 tips on how to be the freelancer you always dreamed of being. You know, the kind who makes money, enjoys the work, and manages to live life, too.

General Freelancing Tips
Here’s some all-around wisdom that every freelancer should know.

Are you charging enough for your work?

5 YouTube channels for general small business advice.

Got a blog? See what 5 major hurdles are stopping you from getting revenue.

The ins and outs of freelancing as a business.

Learn to freelance without clients.

Obstacles you are likely to face on the road to bigger clients.

75 big ways to market your business on a small budget.

Building Your Freelance Reputation
In the freelance world, reputation is everything. Here’s how to cultivate yours.

5 stellar ways to promote yourself.

5 ways to build your followings on top social networks.

How quality backlinks can improve your website’s reputation.

Building an empire is building a community.

Your business should be about relationships.

Staying on Task
Tips on focusing through the infinite distractions that face every freelancer.

201 ways to arouse your creativity.

How to sleep your way to the top.

Plan less, succeed sooner.

Are mental demons crushing your freelance income?

Feel like you can’t leave your work? Take back your lunch and transform your day.

If you’re stuck, here are some great tips on getting unstuck.

Inspired? Here’s how to turn that inspiration into skill.

If you’re a freelancer with a family, here’s how to balance things out.

Promoting Yourself
As much as you want it to, your work rarely speaks for itself. Instead, you speak for your work. Here’s how to do it well.

5 tricks for getting twice the marketing done in half the time.

Build your freelance business with Twitter.

4-step guide to the magical influence of content marketing.

Use LinkedIn as a Facebook for professionals.

If you’re looking to pitch your services in the blogosphere, here are 5 dos and don’ts for getting blog coverage.

Market your services–and brand yourself as an expert–by creating a free report.

You can use Yelp to market your business or personal brand. Here’s how.

50 of the best Twitter applications and resources for small business owners.

How to use social media to market your B2B or niche service.

How much is your Facebook page worth?

Keep potential clients’ interest with specificity.

Precise email subject lines are like diamonds.

10 ways to get attention online.

Get heard with email newsletters.

Little Things That Help
More useful tips, from the horses’ mouths.

How to protect your creative work online.

How finishing projects ahead of schedule can hurt you.

Despite the hype, eBooks aren’t liquid gold.

Tips for Freelance Writers
Writer-specific help.

Thursdaybram is a nice source of ongoing info, tips, and news for freelance writers.
How to become a niche writer.

5 ways to refresh your freelance writing career.

Tips for Freelance Designers
Here are some add-ons to help make your work more efficient.

100 seriously useful Firefox add-ons for web designers.

Where to Find Freelance Jobs
Some excellent resources for freelance jobs.

Try Indeed.com’s job postings to find a gig.

Smashing Magazine also has freelance jobs.

So do Authentic Jobs and Freelance Switch’s job board. There’s also iFreelance, Get a Freelancer and Greatlance.com.

If you’re a freelance writer, try Writing Bids and Freelance Writing Gigs.

Few subjects are as plagued by myths and falsehoods as starting a small business. Everywhere you turn, someone is making sweeping proclamations about small businesses – the difficulty of starting one, the risks involved, the odds of failure or what you “have to do” in order to make it. And unlike in some fields, myths about small business are not simply harmless old wives tales. Rather than leaving you to fend for yourself against business dogma, Business Pundit assembled – and debunked – this list of 12 pervasive myths about running a small enterprise.

“It Takes Money to Make Money”

Image Source

Like many of the myths we will examine, there is a grain of truth to this one. In other words, you probably cannot get up and running in any type of business without at least some up-front expenditures. That being said, “some” is a very loose term and varies widely depending on the type of small business you are looking to start. Starting a restaurant, for instance, is the epitome of a capital-intensive business. Day one cannot even begin until you have rented or acquired a building, hired a staff, purchased inventory and equipment, furnished the restaurant, and the like. No matter how you slice it, a substantial sum must be spent to start such a business. Other businesses, meanwhile, are far less capital intensive. Self-publishing is one such business. Harvard MBA and how-to author John T. Reed, for instance, writes that you can even refrain from publishing a single book until you secure an order from a customer. Reed actually goes so far as to say that “if someone gave me $100,000 and forced me to spend it on my publishing business, I would not know what to do with it.”

“You’re Sunk Without a Business Plan”

Image Source

Here, again, a grain of truth obscures a much larger point. Without question, it’s smart to have an overall strategy in mind before diving headlong into a business of any kind. That is to say, you should have some idea of the segment of customers you feel best suited to serve, and a general sense of what you bring to the table. But this is not what most people mean when they admonish others to have a business plan. More often, what is meant is that you should have a lengthy document spelling out in precise detail exactly how your business will advance from one stage to the next. “What’s wrong with that”, you might ask. The problem is that detailed plans work best when you are pursuing a fixed goal – such as losing weight or sticking to a budget. In these cases, a known sequence of steps has been proven time and time again to accomplish the goal. The goal in business, however, is meeting consumer demand – which is often a moving target. As evidence, look at all the businesses (like Google) that are now doing something radically different from their original plan. Instead of feeling like you must religiously adhere to a plan, resolve to be open-minded and react to opportunities as you see them emerge.

“It Takes a Great Idea”

Image Source

Perhaps the most pernicious myth of all is that business success (small, medium or large) depends on having a great idea. It is difficult to exaggerate how many books, articles and speakers have declared the monumental importance of starting out with an amazing idea. So universal is the appeal of “the great idea” that many now believe it is impossible to succeed with ordinary, proven business models like cleaning carpets or delivering pizza. In fact, there is very little truth to this at all. What counts far more than the idea you start out with is the speed and effectiveness with which you execute. At the time of the VCR’s emergence, for instance, many experts felt that Beta-Max was superior technologically for any number of defensible reasons. None of that matters, however, because most people have owned or used a VCR, but few have any personal experience with Beta-Max at all. The takeaway here is that the idea (no matter how groundbreaking) is always subservient to firm, relentless execution. Furthermore, it matters more that you are satisfying a genuine consumer demand than whether you are implementing the idea you personally wanted to implement.

“50% (or However Many) of Small Businesses Fail”

Image Source

We see such statistics reported constantly, painting a gloomy picture for any prospective small business owner. In light of such foreboding data, who but the most doggedly determined among us will even bother to try? Well, here’s the truth about this one. There is arguably no such thing as the rate of “small businesses” that fail. The phrase “small business” is scandalously vague, encompassing such wholly different and unrelated fields as restaurant operation, self-publishing, plumbing and web design. Given the endless and critical differences among these and other businesses (the types of customers being served, the prices being charged, the market forces that affect demand, etc.) it means practically nothing to proclaim that “small businesses”, categorically, have a set failure rate that you specifically should be swayed by. Far more important to your own decision making should be the unique factors relevant to your market, your customers and your products and services. If data is available on success or failure rates in your industry, these are far more meaningful than any generic statements about “small businesses.” BusinessWeek concurs, having concluded that the results of studies into small business failure rates are “often contradictory or vague.” Rather than getting preoccupied with broad failure rates, resolve to study in-depth the factors that determine success or failure in your line of work, so you can address the pertinent risks ahead of time and reduce your unique odds of failure.

“You Can Delegate All The Unpleasant Stuff”

Image Source

After years or decades of toiling under The Man’s thumb, small business owners are sometimes enamored with the idea of delegating unpleasant tasks to subordinates. If you have ever uttered the sentence “oh, I’ll just hire people to do that” in a dismissive tone of voice, you have fallen victim to this myth before. By now, however, you might be painfully aware of how far short it falls of the truth. The truth is that in most businesses, you will need to be a generalist who has at least some working knowledge of all the tasks needed to run the show. No, we don’t mean that you need to be an accounting expert to hire an accountant. However, if you literally know nothing about keeping the books, how can you know whether the accountant you hire is competent and ethical – or setting you up as his own miniature Enron? Beyond that, it is not always easy to simply “hire someone to do” whatever you need done. Good people are hard to come by, and generally expect to be compensated at market rates. In the early days, you may find yourself operating as a jack of all trades to keep costs down. Once and if you grow, it will then become feasible to hire some help in managing the expansion. In either case, abandon at once the notion that you can hire the functions you need and then wash your hands of them forever.

“I Call All The Shots”

Image Source

Hands down, the biggest draw of starting a small business is unshackling yourself from the control and oversight of a boss. And certainly, running your own company will accomplish this. Nonetheless, the whole truth in this case is, once again, messier and less appealing than we are at first led to believe. While you wont have a pointy-haired middle manager hawking over your shoulder about TPS reports, nor will you be able to just sit around and “do whatever.” In fact, it might be more accurate to say that you will have a boss (albeit an indirect one) – your competitors. In his essay How To Make Wealth, venture capitalist Paul Graham says that your competitors decide how hard you’ll have to work, “and they pretty much all make the same decision: as hard as you possibly can.” In other words, you can only run a relaxed ship insofar as the other pizza shops or financial planners or plumbers do the same. If they ramp up their efforts or capacity, chances are you will be forced by the market to do the same if you want to remain in business. Essentially, a boss provides in corporate America the discipline and structure that you must create for yourself as a small business owner.

“It Takes X Years for Small Businesses to Turn a Profit”

Image Source

Yet another in a long line of sweeping statements about “small businesses” is how long they take to turn a profit. We often hear discouraging estimates that it can take as long as 2-10 years for a small business to start putting money in the owner’s pocket. By now, however, you should know that such statements are too vague to mean anything. To use the restaurant example again, this is a business that you should probably expect to take its time in producing a profit. The likelihood there is that you had to take out a substantial loan to acquire your property, finance equipment, and the like. So now, the restaurant must not only cover the costs of operation, but also service one or more loans for years. A web design business, on the other hand, could theoretically be profitable on day one by charging the first client more than it costs to design their website. Ditto for a financial planner or other consultant. In short, the truth eludes generic estimates and depends largely on the nature of the business you are in.

“I’ll Have More Freedom to Live My Life”

Image Source

Once more, whether this hoped-for scenario actually pans out is largely a function the business you are in and how much time you devote to it up front. Early on, you will almost certainly not have more freedom. This goes down to the root differences between having a job and running a business. Many jobs, for all the disparaging remarks that can be made about them, permit you to invest little of your concern into it and mentally depart from it completely at the end of the day. A business, conversely, often demands your constant attention. Whereas a problem outside your job description can be dismissed as “somebody else’s problem”, when it’s your business, every unresolved problem is your problem. It is not enough to simply explain why there is a problem or prove to a higher-up that you did not cause it – all that will matter is swiftly resolving it. Furthermore, you will come to see your company (for better or for worse) as an extension of yourself, rather than something you passively do for money. None of this is to say that you will not ultimately have more freedom as a result of running your business. However, to expect a ton of it in the early days would be an exercise in self-delusion.

“Now I Can Write Everything Off”

Image Source

While it’s true that business owners can write off far more than employees can, there is great risk in taking this too far. Entrepreneur.com quotes New York-based CPA Philip C. Roventini admonishing small business owners to always ask, before attempting a write-off: “is this something I would have bought anyway if I were not in business?” Keeping this standard in mind, you probably will not get away with deducting 100% of your car payments, nor gas and repairs. Rather, your deductions must be limited to those things (or aspects of things) which pertain strictly to the operation of your business. In other words, you can write off the portion of auto expenses that you can document as being essential to your operations. Keeping good records is also critical. Basically, if you cannot document it and cite a clear connection between the write-off and the operation of your small business, your attempt at a write-off could trigger audits, fines or worse. Be mindful of the saying, “pigs get fed, but hogs get slaughtered.”

“If I Build It, They Will Come”

Image Source

If this is your approach to customer acquisition, you are setting yourself up for disappointment. Very simply, customers today have an endless array of choices – for everything. Where to shop, eat, rent a movie, take a vacation, you name it, there are a myriad of options to pick from. For our purposes, that means that simply “building it” is most certainly not going to bring anyone through your doors (or onto your website.) In order to succeed as a business owner, you will need to actively and ambitiously market yourself to consumers. Some businesses (like restaurants) often thrive on word of mouth promotion. That’s fine as far as it goes, but even this strategy depends on running your business in such a way as to be attractive to a specific segment of customers, and perhaps encouraging them to tell their friends. No matter what type of small business you choose to start, it will rarely – if ever – be sufficient to open up shop and idly wait for orders to start pouring in. Instead, consider your number one task after opening to be spreading the word as far and wide among your target market as often as possible.

“I Can Pay Myself Whatever I Want”

Image Source

There is no faster way than running a small business to forget the notion that salaries are just arbitrary numbers plucked out of thin air. While it’s true that having equity in a profitable business typically offers higher income potential than selling your time (which is what most jobs amount to), it is not true that you can pay yourself “whatever you want”, either. What you take out as income will be subject to input from various factors, such as product sales, your costs and whether you plan on expanding. Many small business owners, for instance, re-invest early profits back into the company to fuel its growth. Then again, others don’t, preferring instead to taste the fruits of their labor as early as possible. Neither approach is necessarily right or wrong, but it’s important to be aware that your income (even though it can certainly be high and rewarding) is not unlimited. You will be limited by the constraints of your business in how much salary you can take out, both in the beginning and throughout the life of the company.

“Small Business Success Requires Bold Risk-Taking”

Image Source

There is a romanticized stereotype of the entrepreneur as a “swashbuckling risk taker” (to quote Forbes) who throws caution to the wind, risking life and limb to get his or her doors open. However, detailed studies of specific entrepreneurs often show that far from embracing heedless risk-taking, they are actually masters at managing risk and insulating themselves from it whenever possible. While he admittedly isn’t a small business owner by anyone’s definition, the textbook example is Bill Gates. Tim Ferris, author of the Four Hour Work Week, has an excellent chronicle on his blog called Do You Really Know Bill Gates? The Myth of Entrepreneur As Risk Taker. In our opinion, this is required reading anyone who believes that major risk taking is needed to succeed in small business. In it, you will learn that Gates systematically and purposely protected himself from just about every risk that confronted him, being careful not to expose himself to any unnecessary threats. In short, the lesson here is to assess what risks you face and confront them head-on, rather than believing that you’re doing what “real” entrepreneurs do by taking them no matter what.

It’s been said many times that business is all about people. That being the case, perhaps we should stop reading management books for advice and start looking at social psychology. Very simply, social psychologists study how people interact with others – their families, friends, and yes, business partners. Smart marketers and executives have been using the findings of this growing field for decades to close sales, hold effective meetings and get their way in negotiations. But rather than putting you through an academic psychology lesson, we condensed the most useful concepts into one article.

The Foot in the Door Phenomenon

Image Source

The Concept: If you’re wondering how to convince superiors, employees or customers to do what you ask, try using the foot in the door phenomenon. This refers to the tendency of people to do something huge if they have already agreed to something much smaller. Your friend should be much more open to helping you decorate your entire house for a dinner party if, for example, he already helped you pick out decorations.

How You Can Use It: This handy principle has countless applications in the business world. Hand lotion and beauty supply kiosks at the mall use it all the time. If you can get a person to talk to you for a couple of minutes and rub some lotion on their hands, you’ve got your foot in the door, and they are much more likely to buy from you than if you had just screamed a sales pitch at them.

The Door in the Face Phenomenon

Image Source

The Concept: Another classic persuasion tactic is known as the “Door in the Face Phenomenon.” Using this approach, you make your actual request look reasonable by first making an outrageous request that the person will unquestionably turn down. When they turn you down, you then ask for what you really want, which now looks trivial in light of what you asked for a moment earlier.

How You Can Use It: Let’s say you want your company to approve funding for a team of five marketers to research a new advertising campaign. Rather than simply asking for this funding and risking being shot down, use the door in the face principle. Ask your company for twice the amount of funding for a team twice as big as what you need. This will almost certainly be disapproved, but don’t fret; you didn’t need that amount in the first place. Act like you’re really going to work hard on cutting the funding down to the bone and reworking your proposal. In a few days, come back and propose the funding request you wanted all along. It will look as though you found a way to accomplish the same tasks for half the price with half the personnel. Social psychology research states that you are much more likely to get what you want by doing this.

The Serial Position Effect

Image Source

The Concept: A truly sharp marketer should understand how our brains process information. The “Serial Position Effect” (developed by Hermann Ebbinghaus) assists by explaining how we remember items we see or hear in lists. Ebbunghaus discovered that things shown at the beginning of a list and at the end of a list are remembered best. This was later titled the “Primacy Effect,” and the “Recency Effect.”

How You Can Use It: This powerful concept can affect what the millions of people seeing your advertisements, listening to your radio promotion, or reading your sales letter, remember about your product. If you have five benefits that your product provides over the competition, think long and hard about which ones you want to stick deep into your audience’s memory. Place those items at the beginning and end of your pitch. This way, prospects will remember these benefits when they see your product on a shelf or think about the commercial they just saw.

Attitudes Follow Behavior: Resolving Cognitive Dissonance

Image Source

The Concept: Cognitive dissonance is a fancy term for when people have opinions, behave contrary to them, and change their opinion to fit how they acted. For example, if you normally despise handguns, but join your buddy at the shooting range one day, you might leave thinking about how “guns aren’t really that bad if you use them safely.” Simply by holding and shooting one yourself, your brain begins thinking positive thoughts about it. Similarly, a “boring” task might later be remembered as “not being all that bad” or even being “fun” because, after all, you did it.

How You Can Use It: What this means to you is that if you can get your customer to perform a small task, such as a little game or survey online, the customer may begin making some positive assumptions about what you sell. This especially works for businesses operating in controversial markets, such as gambling, tobacco or other vice-related products. If you can find a harmless and fun way for potential customers to get involved with your products and services they will be more likely to become loyal buyers down the line.

Two Routes to Persuasion

Image Source

The Concept: Not everyone processes information (including product demos and advertisements) the same way. Generally speaking, there are two types of audiences, depending on your product/service. Your audience is either attentively thinking about your message, or they are distracted. These two audiences take two different routes to understanding your message. The involved group takes what is known as the “Central Route,” meaning that they focus on what you are saying closely, develop counterarguments and respond based on what they eventually decide your product is all about. If your ad or pitch was strong and convincing, these people will probably buy. If it was weak or not convincing enough, there’s little hope of them buying.

How You Can Use It: The distracted audience takes a very different route to understanding your pitch known as the “Peripheral Route.” These people focus on irrelevant parts of the pitch that randomly interest them. The speaker’s good looks, for example might interest them more than the information in the pitch. Simple language is also important for this kind of audience. For example, if you’re selling a market research service, classic adages such as “look before you leap” will probably work better than “perform proper market research before investing.”

Perceived Expertise

Image Source

The Concept: Let’s face it – most of us give more weight to what “experts” say than average Joes off the street. Most people would sooner listen to a warning about the health hazards of eating fast food, for instance, if it came from a renowned nutritionist than from a self-righteous teenager.

How You Can Use It: What makes someone appear to be an expert? One tactic that has been used by marketers (and politicians) is to begin your pitch with something the audience already agrees with. This makes the speaker seem intelligent and makes the audience eager to believe more of what he or she has to say.

Of course, being introduced as an expert never hurt either. A comment about an approaching asteroid from “Dr. Robert Kimmel, Chair of Astrophysics at Harvard University” will surely be taken more seriously than, “Robbie Kimmel, local guitarist and college student.”

Finally, social scientists find that speaking confidently greatly improves believability. A study performed by Bonnie Erikson in 1978 proved this by having college students rate the credibility of two supposed “witnesses” to an accident. One spoke very clearly and confidently and the other one hesitated and stumbled over his words a bit. One by one, each student said the confident speaker was much more credible. Perhaps it’s time to buy your TV or radio guy a course in effective speaking!

Perceived Trustworthiness

Image Source

The Concept: Trustworthiness of the speaker is another factor critical to any kind of visual marketing. No trust, no sale. Fortunately, how trustworthy you look can be controlled almost entirely by you.

How You Can Use It: Our outward behaviors have a lot to do with whether trust us or not. One behavior that seems to carry a lot of weight is eye contact. Researchers have found that if video-taped witnesses in court looked their questioner straight in the eye rather than down or around, they were seen as more trustworthy.

You can also appear more trustworthy by seeming like you’re not trying to influence an audience. “Hidden camera” TV commercials utilize this tactic all the time. Social psychology experiments have found that people who don’t think they’re being watched are comfortable being completely honest.

People also find others trustworthy when they argue against their own interest. Thus, a message about risks of cigarette smoking seems much more sincere coming from the tobacco companies than it would if were given by an anti-smoking politician up for re-election. People might link the politician’s anti-smoking speeches to his political agenda, whereas they cannot do this with the tobacco companies and are much more likely to absorb the message as true.

The Mere-Exposure Effect

Image Source

The Concept: Sometimes repetition alone can make a message more believable. Social research has found that people tend to eventually believe things they’ve been told many times, simply because they’ve repeatedly heard it. Studies show that people rate false statements such as “Mercury has a higher boiling point than copper” as true if they were made to read them a week before.

How You Can Use It: This concept is why companies run the same advertisement three times during a one-hour television show. The first time the audience sees the ad they might just ignore it. However, a week later they may have seen the ad 20 times, and by that point they have begun to accept its message and view favorably the product it advertises.

Distraction Disarms Counter-arguing

Image Source

The Concept: Audio and visual messages are much more effective when the audience can be somewhat distracted by background clutter just long enough to inhibit counter-arguing. Mild distraction often preoccupies the brain just long enough to stop it from inventing a reason to say “no.”

How You Can Use It: Many radio commercials utilize this tactic. The words promote the product being sold while background music or intermittent comedy distracts us from thinking too deeply about the words. Be careful not to distract so much that ad is not processed, however. Extremely violent or incredibly sexual advertisements are often ineffective because the audience is simply too distracted by what they’re viewing to pay attention to the message. They key is to strike a balance such that your message is understood, but not deeply analyzed or argued by the audience.

The Self- Reference Effect

Image Source

The Concept: Remember – a marketer’s job making sure the audience understands and remembers the sales pitch. One handy way to achieve this is known as the “Self-Reference Effect.” The Self Reference Effect refers to the tendency of people to effectively recall information about themselves. Most people are primary concerned with themselves. Thus, memories pertaining to what we think about the most, (ourselves), are held longer and recalled easier. Studies have shown that, when asked to compare ourselves to a short-story character, we remember that character better than if we compared them to someone else.

How You Can Use It: When planning a new marketing campaign or presentation to the board, it is important to keep this principle in mind, as it can greatly influence what your audience walks away remembering. Try focusing on the basic lifestyle and personality traits of your audience. Once you have these squared away, design your new message to match these traits. This makes your message personally meaningful to them and boosts their chance of remembering what you said.

Priming

Image Source

The Concept: Priming is when various stimuli (sights, tastes, smells) automatically trigger thoughts of similar stimuli. The smell of crisp fall air, for example, might trigger thoughts about the holiday. As a result, simply smelling the fall air might make you crave pumpkin pie or apple cider, even though no food is in front of you.

How You Can Use It: Priming is a classic sales tactic that has been used for decades, and you can put it to use for your business immediately. The key is to find some kind of neutral stimulus that is clearly related to your product. A perfect example of this can be found at any movie theater. As soon as you walk through the door your nostrils are overcome with the smell of buttery popcorn. Without even seeing the popcorn or being asked to buy it, you find yourself making your way to the concession stand because you suddenly feel like the movie wouldn’t be the same without the snacks. This is classic priming, and all five senses are susceptible to priming by intelligent marketers and businesspeople.

Prevent Employee Social Loafing

Image Source

The Concept: Have you ever noticed, perhaps in college or around the office, that when groups are assembled to complete a task, it always ends up that a couple of members do most of the work while the majority of members do almost none of the work? This is a social psychological phenomenon known as “Social Loafing,” and it happens everywhere and in absolutely every profession. Social loafing is defined as the tendency for people to put less effort into a task when they are in a group than when they are alone.

How You Can Use It: Social loafing can seriously drain a team’s performance. The good news is that the causes of social loafing are known and consistent. Social loafing happens when no one is personally accountable. When the group is judged as a whole no matter what its individual members do, loafing is almost sure to occur. The sure-fire way to make sure that all of your employees are contributing equally to the task at hand is to assign them to groups, but assure them that they will be personally monitored and evaluated on their contributions to the group. The more someone thinks they will be judged personally, the less social loafing you have. This allows you to make the most of the talent you have on staff and almost always produces stronger results than the vague “group evaluation” does.

Also check out: 46 Businesses With Hilariously Bad Names

In the past, it was easy. Corporations made money. Nonprofits helped the world. If a corporation wanted to help the world, it would donate to a nonprofit, or set up its own foundation.

That model is changing. Social ventures, a new kind of for- and nonprofit hybrid, are easing their way into the business world. From Good Capital, a socially responsible investment firm, to Google.org, which dedicates resources to helping urgent world problems, social ventures are proliferating throughout the country.

According to Andrew Greenblatt, NYU professor and Director of Products and Innovation at Criterion Ventures, the current generation of graduating college students will ensure that this trend becomes a fundamental part of our economy. To help today’s entrepreneurs navigate the confusing world of establishing a social enterprise, Greenblatt helps run Criterion’s Structure Labs, the country’s only one-day workshop on launching a social venture.

Business Pundit caught up with Greenblatt to discuss setting up hybrid ventures, where the movement is going, and how it will change the economy.

BP: Can you tell me more about the history behind Structure Labs? How did you guys come up with the idea?

AG: Criterion Ventures is a consultancy that launches social ventures, specifically with an eye towards things that have broader social impact. We also launch our own ideas. We identify some kind of need in society, find a sustainable way to address that need, and then launch a venture around it. We’re social entrepreneurs for hire.

Through this work, we’ve found out more about the problems faced by social entrepreneurs. Legal structures are an issue that came up over and over again. You’re either a for-profit, and your goal is to maximize profit. Or you’re a nonprofit charity, and your goal is to maximize making a better world.

Now we have all these blended, multiple bottom-line ventures coming together. Legal structures haven’t kept up. If you just want to maximize profit, there’s one structure. If you want to go out and have people give you money and use that money to do good in the world, there’s a different structure.

When you want to start blending your purposes, it becomes harder. So we created this 5-hour workshop that helps people understand what their options are, and what the advantages and disadvantages of all the options are. It’s fun and engaging. People can take their own projects to the workshop and work with their own real-life We got a grant from the Packard foundation, and that helped us create this, and now we are going around the country and offering the workshop, and that is really cool.

BP: What is a multiple bottom line?

AG: A single bottom line is profit. A second bottom line takes into account other stakeholders in the company. That could be the workers, so people could say that Costco cares about its workers, gives them health benefits, etc.

It could be their community, it could be their suppliers. For example, Ben and Jerry’s would hit cream crises (an oversupply of cream made prices collapse). When one of those cycles hit, and the price of cream went below the cost of maintaining the farms, then Ben & Jerry’s continued to pay the previous year’s to support the family famers.

The third bottom line is the environment. For example, is our carbon footprint growing or shrinking? Are we putting more toxic waste into the world, or less? That kind of stuff.

One beautiful thing about free-market capitalism is that there’s a really simple universal measure of success, and that’s profitability. When you start to add these other things–What does it mean to take good care of your workers? What does it mean to take good care of the environment and the community?–everything becomes squishier.

BP: If I want to launch a social venture, what are three of the most important things I should know, from a legal structure perspective, before I start?

AG: It depends on the social structure. If you want to start a foundation, because your Aunt Tilly died and left you $20 million to give away to save the pelicans, those 3 things you’re worried about are very different than if you’re trying to sell bednets in Africa. So the casual phrase of “social ventures” makes it hard for me to answer that question.

I can give you a broader answer, however. There are probably the three pieces of advice I would give to anyone.

Most people think, so this is my mission, that’s my job, and it’s my lawyer’s job to think about the structure. There are two problems with that strategy. The first is that unfortunately, some lawyers are better than others. The second is that people limit their own vision before they ever meet with their lawyer, because of their false assumptions.

And they go meet with their lawyer with their now-limited vision, and the lawyer says “yeah, I can do that.” Now, if they had a broader vision, then the lawyer would still say “yeah, I can do that.” But they’ve already clipped their own wings (when they limit their vision).

The second thing is that the legal structures have ramifications through different phases of your organization’s life. What your legal structure is will matter when you raise money, so lots of people start there, deciding on a legal structure based on whether they want donations or venture capital.

Some people go a little further. They think of their revenue streams, they think “how am I going to sustain this?” That might influence whether they’re going to be a for- or nonprofit. That’s usually as far as people tend to think.

The next thing that’s going to matter is how are you going to grow? You can franchise your operation, you can license out your intellectual property, or you can just grow. What your legal structure is will impact what options are available to you.

Then, there are issues about how you interact with your market. Being a nonprofit sends a certain message to your customers and your vendors. Being a for-profit sends a different message and allows you to interact with them in different ways.

The last thing that people don’t think about–that we have as the second thing you need to think about in our workshop–is your exit strategy. Someday you will exit this venture. If it means that God comes and takes you to heaven, I assure you, someday you will leave this venture.

Thinking through how you want that exit to be is crucial to how you set up your venture. If you think look, if this is wildly successful, and can sell someday, and I want to capture some of that money and retire, ok…well if you start a nonprofit, you can’t sell it.

So if you’re thinking 20 years from now, you’re retiring and selling this baby off, and you’re starting a nonprofit, we have some talking to do. Things like that.

BP: Let’s look at social ventures as an emerging economic movement. Where would you say we are right now on the timeline of that movement? Where are we going?

AG: Infancy. Elements of this have been around for a while. The idea that you can have sustainable ventures that encourage justice in the world is not new. You know, the YMCA’s been around for a long time. But as a movement, as people identifying it as a unique strategy and getting it moving, that’s pretty new.

It’s hard to choose a moment when this began. We didn’t have a Stonewall (Ed.: or any other major event to mark when this began). But it’s not more than 50 years ago that people started talking about being social entrepreneurs. It’s new.

When I was in law school, nobody knew about this. The fact that a few of us were graduating and wanted to go out and make a difference in the world was viewed as weird. This was 1990-3.

I went back to school to speak at Harvard about a year ago. Someone came from the business school to watch me speak, and we went out for drinks afterwards. He said that the largest student club at the Harvard business school today is the private equity club. The second largest club is the social venture club.

The world has changed rapidly, and it’s picking up speed. Students today are way ahead of where we were as students. That’s going to impact this world bigger, faster, stronger for a long while to come.

If you’re a recruiter for the mainstream economy, and you go to the business school today, you’ll be confronted with the fact that one of the biggest groups is the social entrepreneurs group. If you’re Rape and Pillage Inc., you’re going to have trouble recruiting talent.

I’ll give you one other example. There is a new corporate form out there. It’s called L3C, the low-profit limited liability company. It’s kind of an LLC, but also a new corporate form.

It was created in Vermont less than two years ago. It’s now available in 5-6 states. Just that there is a new corporate form says something, and the fact that it’s being picked up by other states so quickly is saying there’s a real hunger for this.

I think that this is a very young movement, and it is rapidly gaining speed. Economic forces will continue to push that. I think it will snowball faster and faster.

BP: How do you see this movement of social ventures changing the economy?

AG: In response to this? That’s a really complicated question. I’ll give it a shot.

I think more and more of the entrepreneurial energy will move in this direction. Most entrepreneurs start in their twenties. They usually really hit their stride in their forties, but they start in their twenties. And entrepreneurs in their 20s are doing this.

So, 20 years from now, this is what entrepreneurship is going to be. Currently, venture money is moving in this direction. Later on, expansion money is going to have to follow. As so many ventures mature, buyout money will move in this direction, too.

That’s already happening with certain consumer brands. Odwalla was bought. Danone yogurt bought Stonyfield Farms because that’s the part of the yogurt market that’s growing. You can still by Dannon yogurt, but it’s the part of the company that’s shrinking. You’re already seeing it begin to happen. It will happen more and more.

The dominant view now is a shareholder ROI economy. Things that can make money for investors get done. If you look at the trillions of dollars of investments that happen in America every year, the majority are driven by ROI for the investor. They fuel the bottom line.

That’s going to shift slowly to the multiple bottom lines. Ultimately, it will be more profitable to do that. Companies that don’t give a crap about anyone else will become less profitable. People won’t want to work there, won’t want to shop there. It will hurt your bottom line to be that company.

Today that’s not true, but you could make the argument that we’re starting to see it. For example, you can look at Costco versus Wal-Mart, and their stock price over the last 10 years or so. The recession may have changed this, but over last 10 years or so, Costco’s perfomrance has continuously been better than Wal-Mart in terms of P/E ratios. That’s partially because people view Wal-Mart’s relentless strategy of single bottom line as a detriment to them. Costco, which treats their workers better, cares about other stakeholders, etc., is viewed as the smarter long-term play.

If you look at who’s graduating from the top business schools today, that’s the talent pool that’s going to answer that question. But I don’t really know what’s going to happen.

We’re still trying to figure all that out.

BP: Anything else you’d like to share?

AG: Some people think that some of these ideas are good business, and they would have survived anyway, and that by painting it with some sort of social gloss is just decoration.

For example, Wal-Mart is way ahead of every other large retailer on the environmental front. They’re pushing their vendors, for example, to reduce packaging.

Pushing is the wrong word. They’re saying if you want to be on our shelves, you have to get rid of that excess packaging. It’s that simple. If you want to be in their stores—20% of the market or whatever—you’ve got to reduce packaging.

Some people are looking at that and thinking well, great, they’re protecting the environment. From Wal-Mart’s perspective, not doing it means more packaging in their trucks and less shelf space.

Yes, it’s good for the environment, but it’s good for the bottom line. They’re doing all kinds of cutting-edge energy management. They use very high-efficient lighting, and it’s off when it should be off, and all kinds of stuff. Again, why waste money?

Some people will say to the extent that any of this matters in business, only the stuff that goes to the first bottom line anyway gets picked up. So Costco will say we give good health benefits, train our workers better, and pay higher wages because it’s cheaper than having high turnover, and because our customers, when they ask where something is in the store, expect the right answer. Having someone who just started yesterday isn’t going to help that.

Some of that stuff that gets shed, is just stuff that costs money. It will help that first bottom line. That’s what some people will say who are watching all of this happen. Because clearly things are happening. You’re watching all this and can’t pretend that this is nothing. They’ll think that’s what’s happening.

I think they’re half right. The things that help the first bottom line are the things that will be picked up fastest and go quickest into the market.

But I think that the mindset of the public is changing generationally. That will have deeper impacts over time that we’re just starting to see. For example, if you want to hire the best and the brightest out of the best schools, you have to offer them more than just a high salary. There will be a generational shift that will go deeper than just “it makes sense to turn the lights out when nobody’s in the store.”

*

Andrew Greenblatt is the Director of Products and Innovation at Criterion Ventures. He is an entrepreneur, lawyer, professor, and social venture expert. Find out more about Andrew and Criterion here.

Images: Steffen’s blog, Harvard Social Enterprise Club, Yarek Waszul

...according to sources familiar with the situation–Twitter is in advanced talks with Microsoft and Google separately about striking data-mining deals, in which the companies would license a full feed from the microblogging service that could then be integrated into the results of their competing search engines.

Twitter is…seeking to create a large open platform, which many could plug into, from search engines to marketers to publishers to developers.

Smart move for Twitter. Licensing tweets for real-time inclusion is a potentially easy and steady way to monetize. It’s also less potentially irritating than some of Twitter’s other ideas (derived from changes in its Terms of Service), which include selling tweets to marketers. That won’t stop Twitter from doing both–especially if it that means it can remain an independent company.