Best & Worst Ways to Spend a Fortune

Attention, Facebook millionaires: Money can buy happiness--if you know the right way to spend. (Hint: Skip the yacht.)

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What would you do with a heck of a lot of money? Would you be happier? How much so?

In recent days, we've watched the aftermath of the Facebook IPO, and paid close attention as news broke that SAP is acquiring Ariba. We've been thinking about what happens when entrepreneurs come into a windfall. The classic advice is that you should do very little at first--no major lifestyle changes.

But of course not everyone follows that advice. Ariba was a public company with a soaring stock price a dozen years ago, when it acquired Jon's company, SupplierMarket.  Upon arriving at his new office, he noticed a LOT of flashy German cars filling the parking lot. An employee told him that something like 10% of all BMWs sold in Northern California that year were bought by newly minted Ariba millionaires.

We thought a lot about this as we explored how to lead a balanced life in our book, Breakthrough Entrepreneurship.

Wealth managers certainly have a theory or two. Earlier this year, The New York Times reported on the strategy that several Wall Street banks are following, beefing up their offices in Silicon Valley and getting in touch with executives and rank-and-file employees as soon as there is a rumor of an acquisition or an IPO. But, can money can buy happiness?

To some extent, it can. Research suggests that once you earn about $75,000 a year, adding more income doesn't increase happiness much. But of course most entrepreneurs want to make a heck of a lot more than that. And, what would you do--what should you do--if you suddenly found yourself with a windfall?

Carl Richards wrote recently, outlining seven things he thought he would do if his income suddenly doubled, which he in turn thought might improve his happiness. They included spending more time with his family, traveling with his kids, exercising, paying off debt, and even sleeping more.

(If there's one more article you read this year about happiness, please read this one, we promise it will be worth your time. Upfront sneak-peak: Regardless of whether you have a lot of money or a little, the most valuable thing you can buy is time. The ability to say no to things you don't want to do, so that you can focus on what's most important to you is paramount.)

So we got to thinking, what are the best and worst common things that a newly minted millionaire can do with his or her money? Here's what we came up with:

Ways to spend money that are likely to increase your happiness:

1. Health

Ask anyone who suffers from a chronic illness. Without your health, most everything else pales in comparison.

2. Family

They say you can't choose your family'-but in truth, you can. You're the one who decides who you're truly close to in life and who you love. Spending time with loved ones is an excellent way to feel connected and to increase your happiness; having a few more bucks in the bank can make that easier.

3. Travel

Studies show that experiences are more psychologically impactful than ownership of material goods. So think about visiting the Great Barrier Reef, touring the cathedrals of Europe, exploring a game park in Africa, viewing the tremendous beauty of the Iguazu Falls in Brazil, hiking the Appalachian Trail, or sampling the menus of the 10 best restaurants in the world.

4. Philanthropy

There are plenty of people who need money a lot more than you do. Think about what's important and whom you'd like to help. For example, teachers post ideas for projects in underfunded classrooms. There is an entire world that can be improved, so explore the possibilities.

5. Investment in Other Ventures

Many successful entrepreneurs seek to reinvest in new ventures. This can work great if you possess in-depth knowledge of an industry and have a sense about where to find the next great opportunities. Beware though--the qualities of a great investor are often quite different than that of an entrepreneur. In a word, you have to be more skeptical as an investor than you were as an entrepreneur.

Meantime, there are some endeavors that suddenly wealthy start-up entrepreneurs (and employees) might dream about pursuing, and which may be fun for a while, but are not likely to bring enduring happiness.

 Fun things that wear-off pretty quickly (ranked from worst to best):

1. Hookers and Blow

Some people (you know who you are) have watched too many movies, and think this is how you spend a fistful of cash. In other words, pure hedonism. If you really cannot resist, then dabble in Vegas, Amsterdam, or Bangkok. But keep in mind that just because you have money, you're not above the law--and once the cash dries up, your new "friends" will disappear fast.

2. Cars and Other Toys

Perhaps everyone who makes it big should allow themselves one toy. It's a good way to learn what money can and cannot buy. But at the very least, learn how to drive your new monster before you do this.

3. Trophies

People who hit the super-big time, often have too much money to actually spend. They turn to auction houses or yacht builders. If yachts are the answer, why are their owners always buying and selling them? When it comes to trophies, remember there's probably someone with a bigger one than yours.

4. Politics

Many wealthy people support political causes that are important to them.  Unfortunately, our political system has turned into a big financial arms race, and the reality is that campaigns at all levels are highly influenced by who can raise the most money. It may not be how a democracy should work, but it's how ours currently does.

5. Real estate

Finding a nice home is an important part of being happy. You may want to make your home in certain community, part of the country, with access to certain schools or recreation. But remember two things: First, bigger is not necessarily better. And second, well, you don't really need a "second." For those who buy three or four or five homes, that requires a full-time commitment simply to keep the places running. How much time do you want to spend on that? Hotels are a lot easier!

Good luck to you in your entrepreneurial ventures. Hopefully your primary motivation is your passion for an industry, your desire to create great new products or to solve customer problems. But it's only human to daydream about hitting the jackpot. Perhaps we've given you a few ideas to think about what you'd do.

Jon Burgstone was co-founder of SupplierMarket, acquired by Ariba for $1.1B. He now teaches at Berkeley, where he helped launch the Center for Entrepreneurship & Technology. He is co-author of Breakthrough Entrepreneurship. @jburgstone

Bill Murphy, Jr.: is a journalist, ghostwriter, and entrepreneur in Washington, D.C. He is the author of Breakthrough Entrepreneurship (with John Burgstone), and is a former reporter for The Washington Post. @BillMurphyJr

Crash Course: Boost Your Creativity

Chances are you're not using your creativity to the full, says the director of Stanford's entrepreneurship center. Here's how to fix that.

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Vanishingly few of us are born Mozarts or Rimbauds, with symphonies or poems bursting fully formed from our brains before we've even reached an age at which you could legally buy a beer in America. So what are us non-prodigies to do, simply accept our modest level of creativity and get on with life?

One solution for those of us with less than stellar creative gifts is practice. Malcolm Gladwell set off a mania for practice a few years ago with his book Outliers, in which he argued that to become truly excellent at any skill, you need 10,000 hours of deliberate practice--that's six hours a day, six days a week, over six years of simply sticking with it. This conclusion may be tough-but-necessary medicine for Olympic hopefuls and aspiring concert pianists, but it's hardly useful for the average entrepreneur hoping to improve his or her levels of creativity. After all, you presumably want increased innovative thinking to help with your business, and your business will certainly go under long before you reach 10,000 hours from simple neglect.

Happily, when it comes to creativity, there appears to be a middle way between in-born effortless genius and laborious, time-intensive practice. Tina Seelig, executive director of the Stanford Technology Ventures Program, has outlined it in her new book inGenius: A Crash Course on Creativity. The book argues that most of us are not as creative as we have the potential to be and, thankfully for the time starved business owner, living up to our full creative potential doesn't necessarily mean locking yourself in a practice room for around a decade.

Instead, Seelig offers simple but powerful ways to increase your creativity by shifting how you approach problems, including just being more observant and asking better questions. "Albert Einstein is quoted as saying, 'If I had an hour to solve a problem and my life depended on the solution, I would spend the first fifty-five minutes determining the proper question to ask, for once I know the proper question, I could solve the problem in less than five minutes.' Mastering the ability to reframe problems is an important tool for increasing your imagination because it unlocks a vast array of solutions,' she writes.

Interested in more simple but powerful ways to make the most of your creativity? Have a look at this entertaining 40-minute presentation Seelig gave to Googlers recently. What does it contain? Here's a sample:

"Most people in the world view themselves as puzzle builders. That means they're going out, getting all the pieces they need and putting them together to solve their problem," Seelig tells the Googlers. "What's the problem with that? The problem with that is if you're missing a piece, oops, it can't be done. Instead you need to view yourself as a quilt maker. Quilt makers are people who take the resources that are available to them and bring them to bear on the problem they're trying to solve."

 

Jessica Stillman is a freelance writer based in London with interests in unconventional career paths, generational differences, and the future of work. She has blogged for CBS MoneyWatch, GigaOM, and Brazen Careerist. @EntryLevelRebel

Smartphones of the Future: 6 Predictions

Future mobile devices will change the way you do business--in ways you probably can't even imagine. Here are a few predictions.

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Think your smartphone is powerful now? Wait until the year 2050, when Apple will have faded into oblivion (most major tech companies can last barely 30 years).

Your phone will be paper thin and charge wirelessly. You'll probably project a high-def screen onto a wall when you want a bigger screen, since laptops will have become relics. But the truly impressive innovations will go far beyond these well-known predictions. Super-smart AI will make your phone even more powerful for business. Here are my predictions for what phones will do:

1. Analyze your surroundings

Future phones will analyze your surroundings, but not in the way you might think. Today, phones can connect to a Bluetooth signal and stream audio to your car. In 30 years, your phone will become more self-aware. When you arrive in your hotel room, your phone will connect to the thermostat and adjust the temp according to your usual preferences. You'll have fingertip access to every other electronic gadget, even the sink in the bathroom--say, to find out when it was cleaned last. And, you'll see instant info about the connections available, your hotel bill, who is nearby, and the weather. This data will not lurk in disparate apps, though--your phone will get it on the fly.

2. Record information

One of the problems with human memory is that it tends to be fallible. That's not a problem for your phone. Yet, in the future, phones won't just store data you put there. The device will morph into a digital recorder of every event, place, and experience. Walk into a conference room, and sensors in your phone will tap into the phones of every other attendee, recording their names, professional experience, and even their recent travels. You'll record audio and video, of course, but the phone will do this automatically by tapping into other cameras in the room and during important occasions. The AI will know what you want to record and do this in the background without your intervention.

3. Display clean data

In the current digital age, you don't have much choice about how information is presented. Turn on CNN, and you have to live with the programmed chatter. Yet, a future phone will have the ability to adjust streams of information. This is more than just editing. Your phone will become the main conduit you use for seeing information, but it will be smart enough to weed out information you don't care about. When you read a future digital version of The New York Times, your phone will customize the information for you on the fly--presenting only relevant news in chunks you determine.

4. Monetize your mobility

In a future cashless society, one based primarily on transactions you conduct with your phone, you'll be able to monetize your mobility. Say you show up at a meeting having researched a topic extensively. Your phone can offer to share this information for a small fee with business partners. You'll also be able to offer a stream of well-honed content like indie movies and newly discovered music under your own micro-distribution license, similar to iTunes but localized and wireless. Once all of our financial data is stored on our phones (and highly secure), we'll start using the phone to sell just about anything. This will work both ways, of course. The accumulated knowledge of others will also be a click away.

5. Familiarize your world

Phones already do a good job of helping us understand the world around us--just use the Zillow app to see a constant stream of house prices as you drive around. As an intelligent agent of learning, your future phone will go much further. You'll speak into your phone and it will translate what you say in real-time, in any language. (Some apps do this already, but not smoothly or quickly.) Your phone will know your preferences and will connect to neighborhood services. Say you like soccer: Your phone will let you know the city has recently improved a soccer field as you drive within a few blocks. If you like a new band, and arrive in Orlando, your phone will let you know where the show is happening.

6. Fraternize with others

The concept of gamification is already here--just look at Klout perks or Bing rewards. In the future, the concept will expand much further. Your phone will constantly scan for like-minded people (as you can do today with some social apps) and you'll be able to hold multiplayer matches with nearby gamers. But future phones will "gamify" anything you want, from beating your boss to a meeting to earning perks for sharing an easier route to the museum with the car next to you (and getting a free gas token as a reward).

John Brandon is a contributing editor at Inc. magazine and writes the Tech Trends column in every issue. He also writes the Tech Report column for Inc.com. @jmbrandonbb

Silicon Valley's Inconvenient History

If you believe that government funding only harms innovation, let us introduce you to Uncle Sam's most successful start-up: Silicon Valley

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MICROWAVE VALLEY: At one point in its history, Stanford University essentially became a research lab for the CIA.

Which way you lean in this Presidential campaign depends a lot on whether you think government spending is capable of doing any good, or whether it is by its nature obstructionist. If you believe the latter, you tend to believe that all good flows from private enterprise and capital alone.

And you will tend to have a lot of company among entrepreneurs. Self-made millionaires, people who started great companies in garages and dorm rooms, people who've read Atlas Shrugged 10 times'your classic successful entrepreneur'tend to think of government spending as only capable of throttling innovation and entrepreneurship, not encouraging them.

The only problem is, that point of view is hard to reconcile with the history of Silicon Valley. The entity that built the Valley and gave birth to its culture of collaboration and experimentation was none other than Uncle Sam. In other words, the creation of the hub of American entrepreneurship and innovation was a federal project.

The Secret History of the Valley

My source is entrepreneur and Stanford prof Steve Blank, as well as the multi-part blog he wrote a couple years ago, which he calls the Secret History of Silicon Valley. In a recent conversation with me, Blank exclaimed that hard-core libertarians, particularly those from the Valley, believed in a Valley creation myth in which the semi-conductor fabs sprang from orchards in one rapid evolutionary swoop. In fact, he says, before there was was Silicon Valley, there was Microwave Valley, which specialized in electronic intelligence'spying on Soviets air defenses, basically'and the seed capital for it came exclusively from the CIA and military. Private capital arrived much later.

 At one point, says Blank, the institutions of the Valley were so totally in the pocket of the Department of Defense that Stanford became essentially a research lab for the CIA. A number of engineering Ph. D.  theses were actually classified. The largest employer at the time'and still the third largest for-profit employer in the valley is not Google, and certainly not Facebook. It's Lockheed Martin.

Could History Repeat?

At the moment, Blank is very excited about a class of students being funded by the fed's National Science Foundation to attend his Lean Launchpad entrepreneurship course at Stanford.  The 'students' tend to be scientists and academics who are working on big science challenges'hairy problems in biotech and pure technology--funded by the NSF. The government hopes Blank can help them turn those projects into commercial ventures.

 In Blank's view, this is far from government meddling in matters best left to the private market. Private capital, he points out, is currently obsessed with social media. The reasons are understandable'a billion-dollar payday for Instagram, for example, tends to get investors' attention'but let's face it: another Facebook camera app is not going to save people's health, or restore American competitiveness, or life ur standard of living or quality of life.  Those big goals sometimes need a government boost. Blank, for one, is very comfortable with that.

 Now, this is an election year and spending for science research, among other things, is on the Tea Party chopping block. It's one of the few non-defense budget items that isn't a politically explosive entitlement. The dogma among libertarian hard-liners is that government investment has never built anything lasting. Some people who echo that sentiment are from Silicon Valley. That's kind of ironic.

Eric Schurenberg is the editor of Inc.com. Before joining Inc, Eric was the editor of CBS MoneyWatch.com and BNET.com and managing editor of Money Magazine. As a writer, he is a winner of a Loeb and a National Magazine Award. @EricSchurenberg

4 Signs You're a Terrible Communicator

Sure, you're a visionary leader. But do your day-to-day discussions actually move your company forward, or just cause confusion? Here's how to tell.

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As an entrepreneur, you are probably a big picture thinker--the visionary leader driving your company and team forward. 

So, it's also natural that as the founder or CEO, you probably like to communicate. Whether glued to your cell phone, chatting via email or just grabbing someone at random for a rapid-fire brainstorm, you are rarely at a lost for words.

But just because you talk a lot doesn't mean you're necessarily good at communicating.

In fact, many leaders confuse eloquence with clarity, and as a result, often leave the people who work with them bedazzled by their verbal dexterity, and entirely confused about what to do next.

Here are the four cardinal sins of eloquent miscommunication:

1. You talk and think at the same time.  If you're a visionary leader (as in, you think strategically about the big picture), you may be guilty of using your verbal communications as a tool to think. 

As  result, having a 'discussion' with you often means little, in terms of tactical strategy or execution. You're basically externalizing your thought processes. And while a seasoned employee or colleague who is used to such monologues learns simply to smile and nod at the appropriate moments, others will find the process entirely bewildering.

And it's not just that. 'Talking to think' is also highly demotivating. It can make your colleagues feel ignored and puzzled by the pointlessness (from their perspective) of the exchange. The recipient is often left feeling like a stooge who has been used, rather than a colleague with valued opinions.

2. You muse, but never follow through. If you're a visionary leader, you are likely comfortable with ambiguity and uncertainty. You may rarely feel the need to grab for an answer as soon as an issue or problem comes along. As a result, you may set up one or two Aunt Sallies--notions, ideas or proposals that are merely hypotheses or a starting point for rich discussion.

The problem? The Aunt Sally comes wrapped in the usual eloquence and passion, which leave your colleagues unsure whether or not this is indeed just a jumping off point, or a genuine proposal that they are intended to act upon. 

3. You encourage high-level debates. With everyone. So you enjoy a robust debate. You like to engage in verbal conflict; it's how you think things through.

Unfortunately, what to you looks like a healthy, profitable exchange of views often appears to others to be little more than a fruitless argument, with all the associated interpersonal fallout: personal attacks, bruised feelings and ruptured (or at least somewhat strained) relationships.

4. You give solutions for problems that don't exist. Ever listened to a friend or spouse sharing a problem then find yourself prating back at them with your brilliant solution? News flash: They didn't want your solition; all they wanted was your ear.

Because your leadership identity is tied up in being creative and thinking strategically, you may find it well nigh impossible to talk about something without providing at least one, often several, 'brilliant' solutions.

Encouraging others to think through issues for themselves, or simply being there as a supportive colleague is not your strong suit. 

Here's an easy solution: Thankfully, the answer to these four pitfalls is straightforward. In my experience, simple awareness is the key. If you recognize in yourself any of these traits, grab a notepad or journal and for one week monitor your interactions with others.

After each meaningful conversation, simply jot down the name of the person and the topic, and tick off which trap you fell into. You'll soon find yourself recognizing these traits in advance and correcting accordingly.

 

Les McKeown is the author of the best-seller, Predictable Success: Getting Your Organization On the Growth Track - and Keeping It There and is the CEO of Predictable Success, a leading advisor on accelerated organizational growth. His latest book is The Synergist: How to Lead Your Team to Predictable Success. @lesmckeown @lesmckeown

Kevin Ryan: Gilt Groupe's Hiring Secrets

Kevin Ryan: How Gilt Groupe Recruits Top Talent

Gilt Groupe CEO Kevin Ryan talks about hiring, firing, and managing employees.

Your idea isn't the important part of your business. It's the execution that makes the difference.

Roots: Building an Empire: Gilt's Rapid Growth Story8:35

Gilt CEO Kevin Ryan talks about his background and the important people that helped build his flash-sale site.

Team: How Gilt Keeps a Stellar Workforce7:13

Gilt Groupe's CEO Kevin Ryan says you should get to know all of your employees and learn when it's time to promote and let go.

Balance: Stop Trying to Fix Your Worst Employees9:11

Kevin Ryan, Gilt Groupe's CEO, discusses how he determines whether he's hired the right employee for the job.

Talent: 'Your Best Employee Is Underpaid'7:13

Gilt CEO Kevin Ryan discusses how crucial it is to successfully manage your A-level employees. (Hint: Start with a raise.)

Q&A: Gilt Groupe CEO Kevin Ryan on Recruiting8:34

Gilt CEO Kevin Ryan reveals how he hires and manages talent.

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  EXECUTION Why Your Idea Doesn't Matter2:29

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  ROOTS Building an Empire: Gilt's Rapid Growth Story8:35

• 

  TEAM How Gilt Keeps a Stellar Workforce7:13



• 

  BALANCE Stop Trying to Fix Your Worst Employees9:11

• 

  TALENT 'Your Best Employee Is Underpaid'7:13

• 

  Q&A Gilt Groupe CEO Kevin Ryan on Recruiting8:34

8 Etiquette Rules for a Business Lunch

Amid technology overload, face-to-face interactions are even more important. Follow these rules to make sure lunch meetings are both fun and productive.

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Back in the days of Mad Men, the business lunch was essential. Offers were made, partnerships formed, and deals were closed daily over lunchtime martinis.

For the most part, that type of midday meeting is long gone. But with today's communication technology overload, the face-to-face business lunch is still an important way to build relationships--and is perhaps even more valuable today than it was 50 years ago. (It's just less likely to include three martinis and a glass of port.)

Follow these simple rules to make a business lunch both productive and enjoyable:

Get the Invitation Right

Lunch with a client, potential business partner or new colleague can often be more productive than an office meeting. Getting out of the office and off the phone creates an environment more conducive to relaxing and candid conversation.

When inviting someone to lunch, be respectful of his or her time and position. If inviting a superior you don't know well, don't risk being presumptuous--you might opt for suggesting coffee instead.

Who Chooses the Spot?

If you're inviting, offer up some suggestions and let your guests pick. If they don't care, it's on you. But make sure to be careful and anticipate their preferences. You don't want to bring a vegetarian to a steakhouse. If inviting someone to discuss next year's budget cuts, best to skip the meal at the most expensive restaurant in town. If your guest choses the place, don't forget to compliment her on the choice.

Time & Place

Get there early. Always know the set-up of the restaurant and make sure both the venue and your table are right for your objective.

One of my colleagues swears by this rule. If it's a celebratory or casual lunch with people he knows well, he gets a table in a central area, closer to the bar, where it's typically more boisterous. If it's a serious conversation and he wants to get something accomplished, he opts for a quiet table in the corner.

When to Talk Business

On the golf course, the common rule of thumb is not to get down to business before the fourth hole. At the table, it's a bit more ambiguous.  

My advice: If you're having a social conversation, don't bring up business until you have received your drinks and ordered your meals. Then, when business talk commences, frame the conversation around your guest. Ask about her business, what she's working on and where she needs help.

This will give you a clear understanding of context and provide a natural segue into explaining how you and your company might be of assistance.

Speaking of Drinks...

Sorry, Don Draper--if you're taking clients to lunch and your company is paying, you should probably skip the alcohol. But if your client wants to imbibe, let him order a drink. A good rule of thumb is to let your guests order first, so they're not inhibited by your choice.

Handling the Bill

There is an art to handling the bill. You want to be graceful about it. When the check arrives, be nimble and reach for it swiftly--but keep looking your clients in the eye if they're speaking.

By all means, don't stare at the line items with anything like shock or horror.  That said, if there's an error with the bill, excuse yourself to talk to the waiter separately without making your guest feel uncomfortable.  

And when it's time to pay, act naturally: Don't disrupt the conversation, but make  eye contact with the waiter so that he picks up your credit card quickly.

Turn Off Your Phone

You may already know how I feel about this, but I'll say it again: Turn off your phone. Now is not the time to be checking your incoming email or texting your colleague. I've seen some people pick up their phones between courses instead of talking to others at the table. Just don't.

Finally ... Have Fun

Be yourself! There is a reason you're not in the office. You can accomplish quite a lot with business lunches, but you shouldn't lose sight of why they work so well: When people can relax and have a good time, they're more likely to open up, making it easier to strengthen a business relationship.

Eliza Browning is the vice president of Crane Digital, where she oversees the company's online business and digital strategy. Before joining Crane & Co., Eliza worked in digital media for news organizations including CNN, ABC News and the AP.

5 Things to Un-Learn From School

You spent a lot of time getting an education. But if you want to make it as an entrepreneur, it's time to forget some of what you learned.

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You spent a lot of years in school. You learned a lot.

Some of what you learned you need to un-learn as soon as possible. Here are five key attitudes you should adopt instead:

1. If you only do what you're told, you'll excel.

I know. School was hard.

But not that hard.

If you did what you were told--go to class, do the reading, turn in assignments on time, etc.--you could get As. Initiative was not required and, in fact, was often frowned on.

Now--whether you work for someone else or run your own business--doing what you're told makes you average. Not superior, not excellent... just average.

To be above average, or to achieve better than average results, you must do two things:

1. Do what others are willing to do, and do it better, and
2. Do what others aren't willing to do

Otherwise, you're just average.

2. Being micro-managed is to be expected.

Sure, you felt overly-controlled in school: Dates, timelines, rules... not to mention the seemingly arbitrary policies and nonsensical assignments. You saw graduation as the day you would finally have more freedom.

Nope.

In school you paid people to criticize, direct, and at times micro-manage you. Now you're the one getting paid... yet you somehow don't feel it's fair that investors, partners, or customers can dictate what you do, sometimes down to the smallest detail?

Don't expect someone to trust you to perform a task or service'and give you money to perform that service'until you've proven you can be trusted to perform that service.

Then, once you've proven your skills, if you still feel micro-managed it's your responsibility to change the situation. Communicate before you are communicated to. Answer questions before questions are asked. Demonstrate your value before you are asked to prove your value.

No one wants to micro-manage you. They have better things to do with their time.

If you're being micro-managed it's probably because you need to be.

3. Your time off is the highlight of the year.

You may have forgotten your mom's birthday, but I'll bet you knew the exact day every semester ended and the start and end of Spring Break. And you lived for snow days.

So it only makes sense to see weekends and vacations as the highlight of your working year, right?

Actually, no: If you feel you endure the workweek just to get to the payoff of the weekend, you're in the wrong business. Find work you enjoy; then you won't see time off as a chance to finally do something fun but as a chance to do something else fun.

While you'll never love everything you do in your professional life, you should enjoy the majority of it.

Otherwise you're not living'you're just working.

4. Getting criticized means you failed.

Here's another pay/paid dichotomy. In college you paid professors to critique your work.

So now that you are the one getting paid, why is it unfair for someone--like a customer, investor, or key partner'to critique your work?

It's not.

When you get negative feedback, see it as an opportunity. Think, "Wow, I didn't realize I wasn't doing that right. I didn't realize I wasn't doing that as well as I could."

Criticism is a chance to learn--and this time you're getting paid to learn.

Never complain when someone pays you to learn.

5. Success is based on toeing the line.

Say you disagreed with a professor's point of view on a particular point. You may even have been right... but the only way to get an A in the class was to parrot the professor's take on the subject. Except in rare cases, confirming and following the rules was everything.

In business, conforming only ensures that you will achieve the same results as other people.

If you want to achieve different results you'll have to think and act differently. Do your homework, think critically, and don't be afraid to create your own path.

But don't be different just for the sake of being different. Be different because it's who you are and what you believe... and because it will get you where you want to go, with your integrity and your sense of self intact.

Jeff Haden learned much of what he knows about business and technology as he worked his way up in the manufacturing industry. Everything else he picks up from ghostwriting books for some of the smartest leaders he knows in business. @jeff_haden

Do You Have an Image Problem?

Be honest: Do you look the same in your professional and social media photos? If not, you have a branding problem.

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Here's the problem with social media: It's turned everyone into his (or her) own personal PR agent.

Think about a businessperson you know, preferably someone with a reasonably high profile. Find his photo on the company website, or the photos he uses for promotional purposes. Most of those photos look pretty good, right? (Except the ones where the person's face appears to have been cropped out of a photo taken at a party.)

Now go to his or her Facebook or Twitter profile. Or do a quick image search.

Do the photos you find look like the same person?

Not quite... and the disconnect is often more than a little jarring. The George Clooney you see in the profile photo turns out to look more like, say, me. (Now that's a jarring disconnect.)

Of course you should try to look good in your photos. The research is clear: People want to do business with attractive people.

But don't try to look too good, because people also want to do business with real people. Plus, someday you may meet your customers; even if you won't, while they're checking out your business your potential clients will probably do a quick search on you, too.

Either way, potential customers will eventually find out you're not quite as handsome, quite as trim, quite as young, and definitely not quite the focused-yet-sensitive-artist-with-a-knowing-but-whimsical-smile as your photos make you seem.

Instead:

Use personal photos that flatter but don't mislead.

Pick photos that look natural. Think about how you will look when you first meet a customer and try to match that look. Avoid disconnects between photos and real life (or website photos and Facebook photos) as much as possible. Look good but look real.

Otherwise, when customers meet you they will naturally wonder what else you're hiding or misrepresenting.

Never use stock photos.

Stock photos look cheesy. And they don't fool anyone.

The worst photos of the real you are better than any stock photos.

Don't misrepresent your facilities, either.

Ever seen the Leaning Tower of Pisa? Ever walked the Hollywood Walk of Fame?

In photos many landmarks look a lot different simply because the surrounding areas are usually cropped out. While you're at it, check out any other business-related photos. Certainly show your facilities to their best advantage, but don't over-do it.

And always remember you're not a celebrity.

Actors, musicians, and performers earn their livings based at least partly on how they look.

In most cases, you don't. You make your living based on what you do, not how you look.

Keep that fact in mind where your photos are concerned and you can't go wrong.

Jeff Haden learned much of what he knows about business and technology as he worked his way up in the manufacturing industry. Everything else he picks up from ghostwriting books for some of the smartest leaders he knows in business. @jeff_haden

'Why I Serve': A Veteran Turns Entrepreneur

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June 19, 2004, changed Dawn Halfaker's life.

On that day a blast tore through her platoon's Humvee during a patrol mission in Baqubah, Iraq. A rocket-propelled grenade flew straight into the front of her Humvee, and exploded near Halfaker, tearing through her right shoulder, breaking bones, and damaging her lungs. Halfaker lost consciousness. After being airlifted out of Iraq, Dawn Halfaker was flown to Washington, D.C., for treatment at Walter Reed Army Medical Center.

Halfaker lost her right arm. But even after a trying year of treatment and therapy at Walter Reed, Halfaker hadn't lost her desire to serve.

"I desperately wanted to find a way to stay connected and continue to be part of the fight as my colleagues were still in Iraq and Afghanistan," she says.

She tried interning on Capitol Hill, but it didn't satisfy her. In her words, which she shared with a crowd of veteran entrepreneurs and CEOs at the Inc. 500|5000 in Washington, D.C., "I spent just enough time on Capitol Hill to know I wanted nothing to do with politics."

She founded Halfaker and Associates in January 2006.

"They say necessity breeds innovation. So with my need and desire to be part of the fight, I decided to forge my own path and start my company," she says. "I knew I had something to offer, and could bring new ideas, energy, and a sense of urgency to the defense industry."

She founded the contracting firm alone, taking on anti-terrorism and intelligence-analysis projects for other organizations, including DARPA, the Defense Advanced Research Projects Agency. She called herself "an Army of one."

When special projects required outside expertise, Halfaker and Associates began hiring to fill specific roles.

"I would basically find an expert to try to compliment my expertise and experience," she says.

Today her five-year-old firm employs 160 people, and provides professional services and technology solutions to the federal government.

"We're all focused on building the company," she says. "But first and foremost, we're focused on the idea of continuing to serve."

Christine Lagorio is a writer, editor, and reporter whose work has appeared in The New York Times, The Washington Post, The San Francisco Chronicle, The Village Voice, and The Believer, among other publications. She is executive editor of Inc.com. @Lagorio

Why You Should Hire a Veteran

Look beyond patriotism: Veterans' technical skills (and the tax breaks that come with hiring them) make vets great small business hires.

Flickr/CherryPoint

With the wars in Iraq and Afghanistan winding down, there are bound to be a lot of veterans looking for a fresh start outside the service. Why not hire some?

A recent Society for Human Resources Managament poll of HR pros found that while more than half of organizations surveyed had hired a veteran in the last three years, only 13 percent "reported being 'very aware' of effective resources for recruiting veterans." The survey also found large organizations are more likely than small businesses to take on veterans. What's holding firms back?

"Awareness of resources is the missing piece," said Mark Schmit, vice president of research at SHRM. "Human resource managers don't know how to find [military veterans] and once they find them, they may not understand the military skills jargon on the resume."

Small businesses may be missing out, and not just on an opportunity to be patriotic. Those with images of returning soldiers as worthy but with a skill set not exactly perfectly suited to today's flexible, high-tech workplace, need to update their ideas of what most soldiers do upon leaving the armed forces. While some obviously struggle, when PayScale recently analyzed its database to determine what professions were held by a higher percentage of veterans than the average, they discovered a distinct pattern.

"The majority of the jobs are in technology," reports PayScale's blog, which concludes, "it appears the military prepares its veterans well for today's technological age." Military service, it seems, translates more readily to civilian jobs that many businesses realize. To further illustrate the point the PayScale listed several skills veterans hold more than the average worker:

• Cisco networking
• Computer security
• Contractor management
• Electronic troubleshooting
• Leadership
• Microsoft SQL server
• Program management
• Security policies and procedures
• Security risk management

That's hardly just lifting heavy objects, obeying orders, enduring unpleasant climates, or mastering military-specific tech. And the list doesn't even include "soft" skills like leadership and the ability to handle pressure that military experience often brings. "They know what it's like to work in a fast-paced and results-driven environment," Melissa McMahon, senior director of talent acquisition for tech company CDW, told the American Express OPEN Forum blog, for example.

Veterans may have more skills than you imagine, but according to the same OPEN Forum post there's perhaps an even more clear-cut reason to make efforts to hire them'government incentives. The post explains the tax credits and other assistance given to businesses that hire veterans:

In November 2011, Congress passed President Obama's Returning Heroes Tax Credit and Wounded Warrior Tax Credit, both designed to get veterans back to work. The Returning Heroes Tax Credit provides businesses that hire unemployed veterans with a maximum credit of $5,600 per veteran, and the Wounded Warriors Tax Credit offers businesses that hire veterans with service-connected disabilities a maximum credit of $9,600 per veteran.

In addition to the tax credits, business owners may also be able to get reimbursed for training newly hired veterans, thanks to the Workforce Investment Act of 1998, which provides high-quality job training through state and local workforce development systems.

If all this has you intrigued about the possibility of attracting some seasoned soldiers to your small business, check out the Open Forum post for much more information on ways to connect with veterans, advice on interviewing them and tips on how to help them adapt to your organization.

Jessica Stillman is a freelance writer based in London with interests in unconventional career paths, generational differences, and the future of work. She has blogged for CBS MoneyWatch, GigaOM, and Brazen Careerist. @EntryLevelRebel

Grooveshark's Near-Death Experience

Grooveshark founder Sam Tarantino wanted to reinvent the music business. But in the wake of the 2008 financial crisis, funding was quickly drying up, and he had to tell his employees.

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Spanx Founder Dared to Ask, 'Why Not?'

Spanx Founder Sara Blakely Dared to Ask, 'Why Not?'

How Sara Blakely, founder of Spanx, took $5,000 and an idea for footless pantyhose, and turned it into a multimillion-dollar women's undergarment business.

Sara Blakely went from selling fax machines to creating Spanx hosiery, a leading brand in a formerly male-dominated industry (ironically-enough).

Innovation: How Spanx Got Started13:34

Sara Blakely on how she came up with the idea for Spanx footless pantyhose.

Tenacity: How She Got Spanx on Oprah9:33

The steps Sara Blakely took to land her girdles on Oprah and, ultimately, built the Spanx brand.

Talent: How Spanx Grew7:29

Sara Blakely talks about how she picks team members, handles public relations, and avoids paying for advertising.

Messaging: Differentiating Her Business Idea5:36

The founder of Spanx developed her idea for a year before she mentioned it to friends or family.

• 

  HIGHLIGHTS Pivotal Moments in the Spanx Story2:33

• 

  INNOVATION How Spanx Got Started13:34

• 

  TENACITY How She Got Spanx on Oprah9:33



• 

  TALENT How Spanx Grew7:29

• 

  MESSAGING Differentiating Her Business Idea5:36

How to Handle Pushy Customers

Don't let your company get backed into a corner by a cascade of demands. Here's how to strike a deal that satisfies everyone.

shutterstock images

I watched this interchange at a friend's house between a mom and a 4-year-old child:

"Sweetie, it's not time for cookies.
"Sweetie, leave the cookie jar alone.
"Sweetie, I mean it, I don't want you eating a cookie right now.
"Sweetie, please put that cookie back.
"Sweetie, don't take a bite of that cookie, or mommy is going to be cross.
"Ok sweetie, just that one, but no more ..."

I'm no child specialist'but I think almost everyone can agree that this is not a successful way to change behaviors in our children. Common sense tells us that in raising your children and creating effective relationships, you need to:

• Set clear boundaries
• Be consistent
• Mean what you say
• Have direct and logical consequences

When we're talking about kids, this all seems obvious. But I often see companies managing (or, rather, mismanaging) pushy customers the same way. They cajole, try to delay or deflect, even threaten, but then finally concede. And what happens next time? Two cookies.

There's a better way to handle the situation. Here's what to do.

1. Set expectations.

Too often, pushy customers keep pushing because the lines are not clear enough. You can be service-oriented while at the same time being very specific about what you can and cannot do.  Set the expectation up front.

2. Reset expectations at each interaction.

When a pushy customer asks for something unreasonable, outside of an agreement or even impossible, it is your responsibility to re-assert the original expectations. The old adage applies: If you give someone an inch, they'll take a mile. Obviously, even a 4-year-old can figure out how to take advantage.

3. Aim for parity when going outside of the original understanding.

There are times that you will need to make concessions to appease or serve a pushy customer. However, if all you do is what they ask when they have pushed back, you will have trained them to push harder.

Instead, ask for a concession from them as a part of the interaction'maybe a rush charge, or a limit to the number of unpaid revisions, or a volume purchase thresholds for free shipping. They will learn that simple bullying does not change the agreement.

4. Don't threaten.

Threatening a client takes you down a dangerous road. Instead of working through a point  of friction you have now elevated this to a power struggle, causing long-term damage to the relationship.

Customers believe that they have power because they have the money, so they will begin to either threaten back or plot to replace your services'eventually if not sooner. You want to avoid that. So rather than raising threats, seek instead to offer trade-offs and options.

5. Keep records.

This is about clarity and accuracy, as well as protecting yourself. In the future, when the event is less clear in your memory, you want to be able to return all interested parties to the agreements, expectations and tradeoffs.

Pushy customers can be managed, but if you do not set the standard with a firm and fair hand, you might as well just hand them the plate of cookies'and a stool for easier access later.

Author, speaker and consultant Tom Searcy is the foremost expert in large account sales. With Hunt Big Sales, he's helped clients land more than $5 billion in new sales. Click to get Tom's weekly tips, or to learn more about Hunt Big Sales. @tomsearcy

Your Story Is Your Marketing Strategy

Even small businesses can create powerful, meaningful, sincere branding messages.

Phil Ashley/Getty

Companies are always trying to create the perfect marketing tools--tools that will make brand history, generate buzz for products, and earn those products an unshakeable spot in customer's lives. Large companies have the luxury of throwing thousands of advertising dollars into marketing budgets, but small companies rarely can.  I have found that the most powerful marketing device a small company can develop is its story.

Here's what I mean:

Tell your company's story.

Everyone likes to know the story behind the story, especially when there is an underdog or a hero involved. I was recently talking to the owner of a collections agency who told me he started his business because another company bought the one he was working for, and asked him to let go of most of the team.  Rather than doing that, he himself quit and started his own company, brought the entire team over to his new venture, and successfully avoided firing many people. Learning his story helped me see the kinder side of a business that otherwise seemed heartless, and I immediately felt myself rooting for the owner.

Tell your product's story.

At a trade show this weekend, I stopped by the booth of a Japanese company that makes very traditional Japanese-style screens to decorate and divide rooms.  As someone who loves clean modern lines, this type of product is not something I would usually look at closely. So what made me stop? The company had recreated its workshop space at the trade show, and brought in a traditional Japanese artisan to the booth, to demonstrate how it constructed its product. The intricacy of the piece was astounding and the craftsmanship was fascinating.  It made the product beautiful in a way I never would have noticed had the owners not told me the story of how it was made.

Tell your personal story.  

If you have a service-based business, your personal story and why you do what you do are not only great attention grabbers, but can also be striking testimony about your expertise. The real estate agent who helped my husband and I find our apartment was a successful psychologist before becoming a real estate agent--and she points that out in the literature she provides to prospective clients, because she knows that buying or selling a home can be a difficult and emotional experience.  She sells herself as a consummate negotiator and an understanding counselor to illustrate how she will get her client through the sale in good financial--and mental--condition. Out of hundreds of agents we could have chosen, she got our business.  

Tell your customer how to get involved in your story.

Engaging your customers in your story can be just as valuable as engaging them with your product. There is an independent bookstore around the corner from my house with shelves I have often browsed. I had rarely bought a book there, until the shop posted a sign on the door that implored customers--who enjoy being able to shop locally and want the bookstore to be able to keep its doors open--to support independent bookstores by purchasing from them.  Now I make myself buy something every time I go to the shop--even if I don't really need it.

The next time you set out to win over customers, think beyond the bullet points of your product.  As Lewis Schiff of the Inc. Business Owner's Council once told me: "Facts get recorded; stories get remembered."

Vanessa Merit Nornberg: In 2004, Vanessa opened Metal Mafia, a wholesale body and costume jewelry company that sells to more than 5,000 specialty shops and retail chains in 23 countries. Metal Mafia was an Inc. 500 company in 2009. @vanessanornberg

Becoming Obama's Go-To Lunch Spot

Here's how a pair of Washington, D.C., restaurant entrepreneurs earned a visit from President Barack Obama during National Small Business Week.

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The White House thinks this sandwich shop is the greatest thing since sliced bread.

Well, at least during National Small Business Week it appeared to. If you've ever wondered how to get the U.S. government to talk up your business, take a lesson from Taylor Gourmet.

When the SBA wanted to kick off National Small Business Week and highlight President Obama's small business legislative agenda, the first event was a presidential meeting with a handful of small business owners at Taylor Gourmet, a Washington, D.C., sandwich shop about two miles from the White House.

My office is just a couple of blocks from the local chain's original location, and I've eaten more than a few hoagies there over the years. So, when I heard SBA Administrator Karen Mills talking about the president's visit and how an SBA official had convinced its owners to apply for an SBA loan to finance an expansion, I have to admit I smiled.

The guys behind Taylor Gourmet are Casey Patten, 32, and David Mazzen, 35, friends from Philadelphia who bought an old row house in a dicey Washington, D.C., neighborhood in 2006. The area of town, H Street NE, had been devastated by riots in 1968, and was only just starting to see signs of revitalization. The house itself had apparently been used as a crack den at one point.

"When we pulled up the carpets there was blood on the floor," Patten told me. "When the shades were drawn that's when they were packaging crack. When they rolled up people came to buy it."

But now, that neighborhood, not far from the U.S. Capitol, is turning around, and Taylor Gourmet, which Patten told me launched in their row house only after their first-floor tenant refused to renew a lease, is now a great success.

Obama dropped by Patten and Mazzen's third location, which was financed with an SBA-backed loan. The president bought a 12-inch Spruce Street hoagie--roast turkey, prosciutto, roasted red peppers and sharp provolone--and also picked up "an assortment of sandwiches" for a lunch with congressional leaders, a White House official later said. (Part of the store's schtick is its Philly theme; the bread is trucked in from Philadelphia every morning, and all of the sandwiches are named after its streets.)

Patten said the visit came about as a result of his ongoing relationship with the head of the Washington, D.C., local SBA office, who had originally walked in off the street while touring the area in 2008. It was in that first meeting that they talked about the idea of applying for the SBA loan.

Since then, Patten and Mazzen have opened two more shops. They're currently working on opening a sixth store'and employs 110 people. 

Bill Murphy, Jr.: is a journalist, ghostwriter, and entrepreneur in Washington, D.C. He is the author of Breakthrough Entrepreneurship (with John Burgstone), and is a former reporter for The Washington Post. @BillMurphyJr

Made in USA: 6 Companies That Came Home

Clothing manufacturing in particular is starting to see an uptick in domestic production. Quality is not the only concern: Since fashions can change on a whim, nimble companies are better able to capitalize on a trend. And with more sophisticated manufacturing techniques, production is no longer prohibitively expensive. Karen Kane, for instance, a fashion line based in California, recently reshored most of its production locally. "We looked at the cost of doing manufacturing here domestically, and the cost is not that different,' Michael Kane, director of marketing, told Reuters.

Read more: Made in USA (Again): Why Manufacturing Is Coming Home

12 Online PR Blunders to Avoid

Do you Facebook during happy hour? Retweet without doing your research? You could cause a huge PR mess. Young entrepreneurs share their best tips for promoting your company with care.

Flickr/Capt. Tim

The Young Entrepreneur Council asked 12 successful young entrepreneurs to note one way that their online activity can lead to unforgivable public relations mistakes. Here are their best answers.

1. What's the Update?

When you launched your website, you probably wrote a bunch of sections such as "About Us," "Contact," etc. Don't forget to check back on those later on and make updates as necessary. Reporters make mistakes as it is--the last thing you need is for them to be getting outdated information on your company from your own website and then putting that in an article.
--Stephanie Kaplan, Her Campus Media

2. Hands Off Our Social Media!

While delegating or outsourcing social media isn't entirely problematic, entrepreneurs should always be abreast of what's being said and done on behalf of the company. Google Alerts and social media tools make it easy to stay on top of the company's digital footprint. Entrepreneurs are responsible--no matter what.
--Lisa Nicole Bell, Inspired Life Media Group

3. Retweet With Care

While it's easy to retweet articles or messages, doing so without care can lead to PR gaffes. Retweets can be viewed as endorsements, so all entrepreneurs should make sure that they take a few moments to review anything they intend to share with their followers. Do fact-check and ensure that you identify with the message and messager before you click RT.
--Doreen Bloch, Poshly

4. Don't Overshare Anywhere

Your Twitter, your Facebook, your blog are all places where journalists might look to connect with you. Make sure that your privacy settings are up to date on Facebook and you're not oversharing information on your other public facing social networks that might turn off a journalist.
--Nathan Lustig, Entrustet

5. Mass Email Blasts Are Bad

Don't buy a list of journalists' email addresses and send out a mass email to everyone. Don't add journalists to mailing lists without their permission. Don't send the same email to every journalist. If you can't at least customize a template to each person you email, you're only going to get minimal coverage at best. At worst, your emails will get sent straight to spam.
--Thursday Bram, Hyper Modern Consulting

6. Alcohol and Social Media Don't Mix

The simple mistake that all entrepreneurs must avoid is alcohol influenced social media communication. It may be tempting, but avoid the 2 a.m. tweets about your evening experiences. They can come back to haunt you.
--John Hall, Digital Talent Agents

7. Cut the Crap!

Don't BS reporters. Any publication worth anything will do its research and poke holes in your story. Just be honest and transparent. Authenticity is an incredibly valuable trait these days.
--Brent Beshore, AdVentures

8. Mixing Business and Pleasure

If you run a digital company (or any company that has a strong online presence), everything you do online represents your company. Your personal life becomes subjected to the same scrutiny as your professional one. Act accordingly.
--Yael Cohen, Fuck Cancer

9. Always Take the High Road

Don't ever talk negatively about your competitors, especially on social media platforms. What you may think is private could get picked up by a reporter and become an embarrassment to both your company and yourself.
--Steven Le Vine, Grapevine PR

10. Do What You Say You're Going To Do

Plans change, timelines shift, but overall, I think the more you can stick to what you say you're going to do, the better. Whether that means following up with journalists, or publishing your blog/newsletter on a regular basis, or even releasing your next product on time. Being timely shows that you're committed.
--Nathalie Lussier, Nathalie Lussier Media

11. Know the Power You're Dealing With

You can pay a lot of money to have a PR company craft your messaging, but they're all operating with the same bit of knowledge--you have no control over your message once it sets sail. Be careful, calculated and aware of all risks when crafting your message. Otherwise, it might come back to bite you.
--Christopher Kelly, Sentry Centers

12. Be Constantly Authentic

Companies need to be as authentic as possible in their communications. People trust and build relationships with those who tell the truth. If you mislead or indulge too much and people find out, you'll become untrustworthy by definition. Don't hide the truth, because the Internet finds a way to make the real truth public--with or without your endorsement.
--Lucas Sommer, Audimated

The Young Entrepreneur Council is an invite-only nonprofit organization comprised of the world's most promising young entrepreneurs. The YEC published #FixYoungAmerica, a book of proven solutions to youth unemployment. @TheYEC