Summer Reading List 2014

Summer Reading 2014 BooksI love summertime because I travel more. Traveling more means more time on airplanes and in train stations. As much as I enjoy the destinations I visit, I sometimes enjoy the journey even more because it gives me dedicated time to read. My favorite way to relax while still feeling productive is by reading business books.  This allows me to keep up with what other entrepreneurs are thinking and doing.  Here are some of the books I have been diving into over the past few months.

Start Something That Matters by Blake Mycoskie. I read this book in one sitting, on a train from Washington D.C. to NYC. I was so inspired by Blake’s enthusiasm I immediately told all of my friends to buy a copy and to start wearing TOMS shoes.   Blake discusses how to do good for the world and make money and I was really inspired by his approach.  I think it would be hard to read this book and not be motivated by Blake’s generosity and spirit.

Do Cool Sh*t by Miki Agrawal. I stumbled on this book when it popped up on my recommended reads from the New York Public Library. It is a super quick read but it packs a big punch. What I love about it is that it gives you Miki’s story woven in with tasks and challenges for the reader. If you don’t already have your own business you will want to start one after reading this book, AND, thanks to Miki, you will also have the basic know-how to do it!

Outliers: The Story of Success by Malcolm Gladwell. What struck me most about this book was how success has to do with some hard work and some factors out of one’s control. The book tells fascinating tales about how “overnight successes” really have a lot more going for them than we can see on the surface. Timing is everything – the time you start a project, the time you put in to it. Sometimes the stars are aligned for something unusual to happen.  It struck me that you have to keep working hard, but you also have to be open to what the universe is putting out there for you.

Never Eat Alone by Keith Ferrazzi. I read this book after Malcolm Gladwell inspired me to become a connector in his book The Tipping Point (another great read). I finished Never Eat Alone without a “To Do” list of at least twenty things. Mr. Ferrazzi is clearly good at connecting and he gives some definite and concrete steps that even the shyest people can try.  I find myself re-visiting this book when I want to try a new way of connecting with colleagues and clients.

Americanah by Chimamanda Ngozi Adichie. You can’t read only business books, it’s summer after all! This was one of the top five books I read last year and I can’t recommend it highly enough. This author is incredible – you can see for yourself in her TED talks on the danger of a single story and why we should all be feminists. In this book she tells the story of a Nigerian native who comes to the United States and eventually decides to return to Nigeria. The voice was stunning and the characters crawled into my head and refused to leave.

Have you read any of these books?  Did you enjoy them? What book should I pick up the next time I am on the road? Leave me a comment and let me know!

What You Should Know about Small Claims Court

Decorative Scales of Justice in the CourtroomPeople don’t always deliver on their word.  Even though you were sure to get a rock-solid contract, people disappear or a business may just plain refuse to pay. This bad behavior leads many people straight to the courtroom.  If the contract wasn’t worth a large sum to begin with, however, you may wonder, is it really worth the hassle to pursue legal action?

You may think that if you were only scammed out of a small amount of money, then pursuing legal action isn’t worth the work of initiating and following through with a lawsuit.  After all, there will be papers to file and courtroom appearances to make.  But before you make this decision, you should know what to expect in small claims court.

Here are five truths to consider before deciding whether or not it is worth the hassle to pursue a case in small claims court.

1)   In New York City, the maximum you can sue for in small claims is $5,000.  If you want to collect more than $5,000 the ease that Small Claims can often provide is not an option.

2)  You don’t need a lawyer.  New York City’s Small Claims Court is surprisingly easy to navigate without legal assistance.  The majority of claimants and defendants in small claims court don’t have attorneys. The judge and the court staff are used to dealing with people without legal backgrounds.  The judge makes an effort to speak in plain language.  You can initiate an action simply by filling out a form with the clerk.  These efforts can make a small claims case much easier to manage while going about your daily business.

3)   You can choose between a daytime or evening court time. Many people choose the evening time because they don’t want to miss work.  This can be a good call, but on the evening you are set to appear be prepared to sit in the courtroom until 10 or 11 at night, it can often take some time for the court to dispose of your case.

4)   You should be willing and prepared to settle.  Small claims courts encourage settlement.  After you serve the other party he or she may suggest a settlement.  This can be a very good thing because if you settle, you don’t have to worry about chasing the money down later, which can be the most difficult part of the process (see number 5 below).

5)  You should have a plan to collect the money.  Unfortunately, many people refuse to pay even after a judge has ordered that they must.  For a small claims case to be worth your time, you need to know how you will get the money if the other party still refuses to pay after a court order.  This can be as simple as knowing where the delinquent party banks, but it can sometimes be more complicated.  Small claims is probably not worth the hassle if you don’t have at least some idea of how you might get paid in the end.  If you are going to pursue the action, make sure you have a payment plan in mind.

Have you ever brought a case to small claims court?  Did you find the process hard to navigate?  What do you wish you had known before jumping in? I would love to hear from you!

Three Reasons to Think Twice Before Agreeing to a 50/50 Split

Business_Partners-300x199If you are contemplating starting a new venture with someone else one of the first questions to discuss is how to divide the equity and profits.  Everyone thinks this topic is easy-peasy.  Your business will be HUGELY successful, there will be tons of money to spare and a 50/50 split of $1 Billion dollars is still a heck of a lot of money.  So you and your partners agree to split everything evenly before addressing what the everyday, real work is going to look like.

In actuality, the dream is usually not as you initially anticipated.  This is why talking about a partnership where equity is divided differently is important.  Without a doubt, this is a hard conversation to have with people you want to work with.  It is imperative, however. Here are 3 reasons why partnerships are almost always not equal.

1)   You and your co-partners will not work the same hours.  Most times you and your partners are at different stages in life.  One of you may be starting a family or seeking a promotion at a full-time job or juggling two part-time jobs.  Someone may be unemployed at the time and able to devote 100 hours a week to the new venture.  Often, time equals money, and the partner putting in more hours may want to think about whether she is comfortable splitting the profits with a partner who can’t devote full-time hours to the new venture.

2)   You and your co-partners have different skills.   It almost never makes sense to partner with someone with the same skill set as yours.  After all, if BOTH of you know a lot about web design and no one knows how to manage the books or recruit clients, then the business won’t go very far.  These varying skills often have different values to a start-up company.  You and your partner should discuss the value your skills bring to the long-term goals of the company and how that value relates to the success and profits of the company.

3)   You and your co-partners are contributing different amounts of capital.  Start-ups cost money.  There are the filing fees, the cost of development and networking, not to mention product development and market research.  All of these cost cold, hard, cash.  People have different comfort levels with regards to how much they are going to pay forward without a guaranteed return.  If one partner is willing to commit more funds (or find people who are willing to take this risk) this might lead to that partner believing he is entitled to more profit.  This is a conversation you want to have BEFORE committing yourself to an even split.

These points suggest that you should have a long discussion with potential partners before agreeing to any split in writing.  Instead of assuming an equal split, each partner should sit down individually and address where she feels her time, skills and money lie in regards to the start-up.  Then the partners can have an open conversation about where things should start.  A good partnership agreement can set out timelines for changing the profit structure over time or if circumstances change.  The key is to set something down in writing that works for the current situation but is flexible enough to change when needed.

How to Use Summer Slow Down to Your Advantage

256Summer months can mean down time for many individuals and businesses.  This slow down gives you a great opportunity to re-focus.   Take this time to pull out your company’s written materials to review and update them.  Here is a list of some documents you might want to review:

Articles of Organization/Articles of Incorporation

This is the document you file with the state.  It sets out things like your name, business address and purpose.  Has your company moved offices or begun using a different name?  If so, update this record and notify the state.

Operating Agreement/By-laws

In New York, this isn’t filed with the state, so people often tend to draft it and forget about it.  Forgetting it would be a mistake though because this document can prove incredibly valuable when issues arise.  Use your extra summer time to re-read your initial plans for the business and update the document accordingly.  Have you added more partners? Have you decided to invest your profits differently?  Look over the provisions in this document carefully and see if it still serves your current business model.

Service/Employee Contracts

Business owners can often get surprised when an employee approaches asking for a review of his or her contract.  Get ahead of the game and pull out contracts to see where an employee stands BEFORE she asks for something more.  Are you an employee with a contract now?  Take the time to review your contracts and see what you like and don’t like.  Reviewing annual contracts will highlight potential flaws and give you an opportunity to figure out where you can improve.  Do you have someone working closely with you that you never asked to sign a confidentiality agreement?  Has an employee with poor performance been working under an expired contract?  Looking at all of these documents when there is no pressure means you can re-negotiate with less pressure as well.

Use the summer down time to your advantage.  Take the time to locate and review often forgotten documents.  Give them a quick rundown and be sure you like where you stand.  Your productivity and sanity will be greatly improved in the more busy months ahead.

Questions to Think About BEFORE Starting a Not-for-Profit

doinggood-1I am all for not-for-profit organizations.  Many of my clients have brilliant ideas for how to improve the world and forming a not-for-profit is a great way to attack some of society’s ills.  Without being a Debbie-downer, I want to caution that forming a not-for-profit is hard work!  I suggest you consider some things before you commit yourself to full-fledged not-for-profit status.

Think about these questions BEFORE filing any official paperwork:

1) What state do you want to start in?  Even if you plan on going national or international at some point, you are going to have to incorporate in one place.  Choose a location where you will be focusing your services on or where you will focus your fundraising efforts or, ideally, both.

2) Who will be on your board of directors?  In New York, not-for-profits must have at least 3 members.  Being on a not-for-profit board comes with some legal responsibilities so you should understand what you are in for (as a potential board member) as well as what you are asking your friends or colleagues to sign on for.

3) How will you run your organization?  After filing the Articles of Incorporation in New York State your board should enact by-laws.  These rules set out how the board will make decisions.  Some things are routine, but other things, like whether you want a board that meets in person, may matter more to you.  The entire board should participate in drafting these.

4) How will you manage your finances? If you will be seeking 501c3 status, you need someone who is savvy in accounting to help you document the money you will have coming in and going out.  Set yourself up with someone early on so that they can keep you from making financial mistakes that may cost you down the line.

If you have solid answers to these questions, you are well on your way towards being ready to incorporate as a Not-for-Profit.  Managing a not-for-profit means more than just doing good for humanity, it also requires being smart about the legal and financial obligations you are committing to in the future.