Review – The Impact Equation by Chris Brogan and Julien Smith

Reading The Impact Equation at Blue Bottle Mint Plaza in San Francisco

Do you know how to make an impact? How to get heard? How to have your ideas shared with the world and have an impact?

My friend Chris Brogan along with his co-author Julien Smith have a new book, The Impact Equation: Are You Making Things Happen or Just Making Noise?, which will be published on Oct 25th, 2012. They sent me a preview copy and over the past couple of weeks I have been reading it at cafes and on the muni here in San Francisco. My copy is already dog eared and flagged with post-its for easy reference back to key points in the book.

TLDR review – pre-order this book and read it

First a few disclosures and admissions. One, Chris Brogan is a friend – not an old “grew up” with friend, but not just someone whom I follow on social media channels, he’s someone whom I have met in person many times and whom I knew years ago before he had books published and a speaking schedule that takes him around the world. Two, I haven’t (yet) read Trust Agents which is Chris and Julien’s earlier book. My stack of books to be read – for fun and for business including far too many by folks I know has been large and growing over the past few years and somehow I haven’t gotten to Trust Agents yet. Three, many of the people they write about in this new book (and I suspect in their previous book) are people I know friends from here in San Francisco and from the larger tech/social media/blog/podcasting world. Four, I don’t have the 1000’s of readers/followers/listeners of folks like Chris and Julien but I am as they say “a degree away” from many people who do – folks with millions of followers and a high impact on the world.

With all of that disclosed up front I have been inspired not just to write this review but to rethink a bunch of my personal projects (including this blog) and over the next few weeks and months I anticipate making many personal and professional changes inspired in no small part by the ideas of The Impact Equation. I can’t summarize their book in a few short paragraphs but I will summarize a few of their early and key points and discuss how I plan on addressing them.

To start with the equation itself (quoting from the pre-release copy but I assume this key part won’t change in the final print edition):

Impact = C x (R + E + A + T + E)

Yes, that is, not surprisingly, the simple yet key fact that to have impact now (and in the past) you have to create – frequently, often and well. The full equation defines each part and the book illustrates each aspect of the equation. Contrast – a new idea has to familiar yet different enough to be noticed. Reach – the number of people you can get connected to your ideas. Exposure – how often do you connect with the people you can reach. Articulation – being understood and clear in communicating your idea. Trust – the subject of their previous book but still not entirely figured out – but why will people listen to you? And finally Echo – the feeling of connection that great ideas and impactful people create.

Fairly simple, fairly memorable yet also complex enough to warrant a full book (and I’m sure many more talks and presentations in the future for Chris and Julien).

On a person level my biggest takeaways from the book is a reminder to get myself back into the ongoing, frequent content creation business – that if I want to grow my own personal impact I need to create more content, more often, and more thoughtfully. Furthermore I need to think about this whether I’m going to continue being an independent consultant or if I join a larger organization. That while I may have some impact in my tweets, comments, email list participation and even events that I create if I were more thoughtful about my online (and offline) activities I could have a much greater impact on the world. With more thoughtful (and literally more frequent) effort I can have a far larger impact on the world than i do today. That I can take the conversations I have one-on-one today and still have that impact but also bring it to a far wider audience.

For some of this I will have to get out of my comfort zone – write more content, experiment with new formats for myself (video? audio?) and generate this content far more frequently than I have been for the past few years.

In each of the chapters of The Impact Equation Chris and Julien cover a mix of specific tactics (and the occasional exercise to get you thinking) as well as stories that illustrate their key ideas. Some of these stories are from business people they have met others are illustrated with celebrities they admire. But in every chapter they also focus on asking you to think about how this applies to yourself – how would you evaluate yourself on this dimension of their equation. I think most of these chapters and the book over all are compelling but not every chapter is equally strong.

The initial chapters on Ideas – on Contrast and Articulation are very good and have a lot of useful exercises for everyone. In particular they have a lot of great exercises around how to evaluate your own ideas and how to communicate them clearly.

The middle chapters on Platforms – on Reach and Exposure – however are a bit weaker. In particular I think the chapter on Exposure is the weakest chapter in the book. In part this is because Exposure is in no small part outside of your direct control. They talk in this chapter about the exposure that someone like Jimmy Fallon has from his tv show but they also talk about the impact of frequency on your exposure but the links and what will work best for most people is not entirely clear from this chapter (and it is perhaps not an easy thing to answer). They have a lot of great questions and a few answers but this chapter left me a bit unsatisfied. Yes, participating in the communities you want to reach is great advice (it is what I tell my clients in fact) but it takes more than just that to get great exposure of your ideas.

The final chapters on Network – on Trust and Echo, Echo – are perhaps surprisingly among the shortest in the book. The chapter on Trust is a revisit (per what they wrote, I haven’t yet read Trust Agents) of the topic of their earlier collaboration. The chapter on Echo (Echo, Echo) is nearly the end of the book and very important but also fairly short. It is about how your ideas resonant and connect. Very important but I think if they could have gone a bit deeper here the whole book would have “echoed” for me even more strongly. But that said they make some really important points in this last chapter leading to the conclusion of the book.

Overall as I said above my recommendation is that you go out and buy this book – in fact that you go preorder it now to be among the first to read it. I hope for my friend’s sake that it is a huge hit and given the quality of the content I’m sure it will be a successful book. More importantly on a personal front it has many parts that I will be using myself to make changes in the coming weeks to my own professional habits and practices and online (and offline) content.

Business advice case study – Bohdi restaurant in San Francisco

This post is my personal opinion and advice, unsolicited and uncompensated for by anyone, so take it accordingly.

A few nights ago I had dinner at Bohdi restaurant, a  Vietnamese restaurant here in San Francisco which I have long walked past but haven’t previously had a chance to try. It is a huge restaurant occupying two storefronts in the Mission, in a part of the Mission which has long been borderline but is rapidly gentrifying with new restaurants, shops, galleries and cafes opening up all around Bohdi.

As I ate my dinner I looked around, counted the chairs and tables, counted how many other people were eating that evening (a Sunday night), I watched the one waitress managed the two large dining rooms, and I puzzled on what and where this restaurant had gone wrong. 

Unfortunately based on my observations of hundreds of restaurants over the years, I would predict that Bohdi restaurant will close within the next year, probably sooner rather than later unless they make many changes. 

I should pause here a bit and explain my views and my purpose in writing this post (especially if you are reading this without being a regular subscriber of my blog or a long time reader). I’m a fairly serious foodie and longtime “chowhound”. Back in Chicago I was an active poster and participant on Chowhound, and then later on LTHForum which friends of mine started as an alternative to Chowhound (this was before CNET purchased them). Since college (early 90’s) I’ve been an avid explore of restaurants, especially Asian restaurants, and eat out often. 

I’m the amateur in my family, my father has had a 40+ year career in the food industry helping to design and build food processing processes and factories throughout the world. He’s written many textbooks on food processing and hundreds of academic papers on the food industry. I grew up learning to cook from both of my parents and talking serious food with my whole family. My sister’s long time boyfriend is a former food critic for the New York Times and has recently sold his 3rd and 4th cookbooks which will be published next year. He’s edited recipes for many cookbooks and has worked on multiple TV food series. 

In short my immediate family takes food very seriously. I’m also a serious cook.

And professionally I’m a consultant and entrepreneur, so I look at restaurants not just with the eye of someone who loves food, but also with the eye of someone who is an entrepreneur and who advises businesses. 

So with that said, here are some of my observations about Bodhi specifically and my suggestions for them to consider – and more broadly for anyone who has a food (or indeed other retail) business to think about. 

The good news

• Bodhi serves flavorful and tasty food. The food is good, not without some serious issues (more on that below) but at least they are starting from a good basis of chefs who cook their cuisine well
• Bodhi has a large space with lots of potential. They literally have one of the largest restaurants I’ve seen in San Francisco, not the absolutely largest but a very big space, I counted a bit over 90 seats as they currently have their tables and chair arranged and they are legally licensed for 108 people.
• The location has a lot of potential. They are located on a stretch of Mission St which is almost at the beginning of SOMA. It is a still rough neighborhood but all around them are new galleries, restaurants, shops and cafes which have opened in the past year. The location does not get a large amount of foot traffic, but it is close enough to many parts of the city and parking is still manageable that they could draw a good crowd, and indeed within a few blocks of them are restaurants which are always busy and usually packed. 

The bad news

• They are nowhere near busy enough. They should be serving 200-300 covers nightly for dinner in a space this large, if not more. Instead I’d guess that they rarely serve more than 40-50 covers a night, if that, with perhaps a few additional takeout or delivery orders. 
• Their portions are far too large. Large portions may seem like a good deal, but for a restaurant they mean people do not order as many dishes or as many courses. In many cases they likely mean wasted food and certainly increase the costs to the restaurant of dishes they serve. In large part I think this is in part because they serve food on overly large plates.
• The decor, especially the cheap tables and chairs without any tablecloths is at odds with the menu. They are using uncovered, cheap four or two top rectangular tables and basic standard stackable chairs. In short tables and chairs right out of a discount restaurant supply house. The have a single flower in a small vase on each table but not tablecloths. Everything except the physical size of the space shouts discount, cheap location.  The prices, however, are not exceptionally cheap though neither are they overly high, a few dollars higher for most dishes than the cheapest of Vietnamese restaurants, though the quality is higher. 
• They only have a wine & beer license and no bartender. Though they have a large bar with 9 barstools at it, they have no bartender and are licensed (based on what is for sale) only for wine and beer. And they do not stock a wide range of drinks at that, nor do they push them on customers. Alcohol makes up much of the profits of any successful restaurant, yet they are seriously forgoing this. 
• The layout and single waitress does not draw people into the space. As I sat and observed people walking by and on first entering the restaurant they often looked around a bit puzzled. Here was a huge restaurant spanning two storefronts yet only a few patrons and you have to walk in, past a fountain, and look around to find someone, anyone to guide you to a table somewhere in the vast space. 

So what does all the above mean in terms of suggestions I would offer?

For starters I would suggest that Bohdi make the following changes:

• update the decor at a minimum by adding tableclothes to hide the cheapness of the tables. Better would be to replace the tables and chairs with more natural and rich appearing materials. Tables of real wood, chairs with some design to them. This would be much more in keeping with the neighborhood which is edgy and arts oriented and would make the space feel higher end
• leave no part of the space unfinished, cluttered with storage or apparently unused. At present there is an entire seating area, between the bar and the bathrooms which looks like it is never used. The tables and chairs are just scattered around that space haphazardly. If the demand for that space as a dining area is not there, then perhaps it should be transformed into an extension of the bar and made more functional.
• Remove much of the visual clutter, such as the odd central fountain and the very old (and cheap) art hanging on the walls. Did I mention this is an arts district with countless galleries in the area? Make a deal with one or more of them to hang art on a rotating basis that is more in keeping with the neighborhood (and not coincidentally might suggest holding an opening party in the space each month)
• Simplify the menu still further to have fewer dishes which are even more seasonal and always using fresh ingredients. Write about the choices and suppliers used. Reduce portions (while keeping prices at current levels or even higher in some cases – use local, organic meats and charge a few dollars more for example) . Add weekly or daily specials to try new recipes and to make it special to dine in the restaurant. 
• Upgrade the wine, beer and sake selection. Again look for local supplies, there is Sake brewed here in the Bay Area for example as well as many local breweries and lots of local wine. Include imported sake, beer, and wine but emphasize quality and pairings with the food. Add special beverages for non-alcohol drinkers and train the waitresses on selling pairings. 
• Get demand higher so that the bar has a full time bartender and give very serious consideration since the space is so large to transforming one section to a lounge and to upgrading the license to a full liquor license (which is, I admit costly especially for a space this large). Consideration should also be given to getting a public performance license though that depends on if the space would be used frequently for non-dining events. At a minimum a license that permitted use of one of the two rooms for private events on a regular basis would be a good idea.
• Add the chef’s name to the menu. This is assuming that there is a chef behind the restaurant (if not, get one). But restaurants with the chef’s name attached enter a different category in the mind of patrons than those that are seen as ethnic, cheap dives. With a space that could seat nearly 100 people and should probably see 300+ people a day if not more (since they are open for lunch as well as for dinner) they should be targeting a higher end audience. 
• At the moment I would guess the average cover is less then $20, making these changes would likley move that closer to $30 perhaps even $40 if most tables are getting a bottle of wine or a couple of beers or cocktails. At the moment few patrons would get appetizers, entrees and desserts for everyone at the table, and it did not appear that most were buying wine or many drinks. However throughout San Francisco there is clearly demand for restaurants where the average cover is far higher than $40 and indeed this could be a great date or group dining restaurant where a couple could have a great experience for less than $100.
• With new furniture make a wider range of table types to signal a wider range of customers. At present they have only a very few two tops and every other table is a four top. There should be a few tables set up for larger groups, perhaps arranged for semi-private dining experiences and there should be far more two-tops set up as with only one exception every single group I observed at the restaurant was a couple out on a date.

A few general underlying premises behind my suggestions (here’s where things may be a bit more broadly applicable):

• Curation adds value. It is hard to create a streamlined space and in the case of a restaurant menu. But a tightly focused menu (or selection of goods) signals quality – the assumption being that there is nowhere for a chef to hide on a short menu. Also that every decision has been made with care and attention (as it should have been). A short menu also allows for frequent changes to reflect the best possible ingredients and suppliers. In a non-restaurant context think about the visual difference between higher end retail shops and dollar stores – very few (if any) high end shops are cluttered – instead they sell a relatively small but in theory highly curated selection of goods. Likewise a restaurant with a short, tightly focused menu signals that the chef is very confident – and is only offering the best possible dishes and is not catering to the broad public but to discerning patrons (and everyone wants to be respected)
• Design suggests audience and price. In an artistic neighborhood show respect for art and design. Lazy choices about art to hang on the walls (i.e. stuff that was very cheap) or the use of bulk, cheap furniture, signals a lack of design. Just a few blocks away the new Four Barrell Coffee shows one great approach to furniture – they have all custommade from recycled materials tables and chairs, the effect is striking and well in keeping with their desired audience of “hipsters”. Their other choices, such as playing vinyl for their music and not having wifi are other signals. And they are almost always packed with customers paying premium prices for high quality coffee. 
• If you don’t ask people won’t buy. Years ago I met a professional waiter who shared with me his secret to having average covers which were nearly double his fellow waiters, if they averaged $20 he averaged closer to $40 (which meant his tips were also double or more than double his fellow waiters’ takings). His secret – he asked people if they wanted things. He asked if they wanted to start with a cocktail, he asked if they wanted appetizers, if they wanted wine with their meal, if they wanted dessert, if they wanted an after dinner drink. Especially with couples on a date his technique worked extremely well. 

Sure this last point is simple – but the simple things are often the most important. I’m always surprised by how few restaurants train their waitstaff to always ask if I want something to drink, to check if I want dessert before giving my the bill for my meal. To see if I want some appetizers to start the meal. The better restaurants train staff to do this as a matter of course – and as a result sell much more.

I do not know all of the numbers for Bohdi restaurant, but my very rough estimate would be that between lunch, dinner and delivery they gross far less than $500k a year, probably less than $400k. In s apce that large, however they should be grossing over $3M or more a year (potentially a lot more). And yes, to gross that much they would need to have far more staff, buy more supplies, do more active promotion, spend more on printing, cleaning of tablecloths and the like, but I suspect they would net vastly more than they do today – and with some further changes could net far more than $3M a year (which is based on an average cover of $25, shift to $40 or higher and to high alcohol sales on a regular basis and profits could be much more. 

If I were wokring with a client such as Bohdi restaurant I would start with the following questions (see above for some of the probable results):

1. What strengths does the business start with?
2. What is working already?
3. What resources does the business have?
4. What is the initial impressions of the business (if retail on walking past, on first entering, if online on first visiting the site)
5. What does that impression signal about the target audience and especially about the price expectations of that audience?
6. Does the actual experience then reinforce (or call into question) those initial impressions?
7. What could be done immediately to start to change? 
8. And then what further changes should happen, ideally looking to make changes that reinforce other desired outcomes and build on it (i.e. start with tableclothes, move to partnering to improve the art, then throw opening parties to build awareness and get people in, then change the menu to help grow revenues, then reinvest in getting better/higher quailty furniture, then in expanding/enhancing the bar options etc)

As I noted this is based on my experiences of walking past Bohdi and of eating there once as well as my long time observation of the restaurant industry. It is certainly possible that I’ve missed some key aspects to Bohdi’s particular situation (they might do a booming lunch business for example though I doubt it). And as in every case, if I were working with the business it is likely that there would be other issues that would be discovered and would need to be addressed – every situation has surprises and unique aspects.

But hopefully this (admittedly long) post helps them (if they see it) and inspires others to rethink their particular business.

And yes, I’m available to do extended versions of this type of consulting work (the first meeting is free but after that I charge).

Resume advice or why mention “Disassembled Particle Accelerator”

This afternoon I was, as happens on a regular basis, asked to look at a friend’s resume and to give her some feedback and advice. She is a relatively recent college graduate now looking for her first “real” job though she is already an active member of the tech circles in the bay area and has worked as an intern for a number of startups.

After giving her the fairly typical advice – stuff such as correcting some awkward phrases, some minor spelling/typo type errors, a few rough bits of grammer as well as focusing her on being specific – on what she wants to do as well as what she has already done – I then sent her the following bit of advice.

Always have something on your resume which will stand out and demand to be explained.

Not in a bad way, something you have to explain away, but rather something which is memorable and which someone reading a stack of resumes will want to learn more about, to get the story behind why you mention that particular skill or past job etc.

In my case I have, for most of my career, included the phrase “disassembled particle accelerator” on my resume and in almost every job interview I have ever had the interviewer has asked me the story behind why I mention that particular fact about myself.

First and foremost this should be a true fact – not something you make up. In my case the summer after my senior year of high school, before I entered college at the University of Chicago, I spent the summer on a National Science Scholars program working at Argonne National Labs, in my case working for a number of physicists that summer. While most of my time was spent writing FORTRAN programs and working inside of Mathematica, I did also watch one medium sized particle accelerator run. And I did, in fact, disassemble a room sized lab table top particle accelerator to free up that laboratory for a new set of experiments.

So I am among the likely very few people in the world to have disassembled a particle accelerator and so I mention this fact on my resume.

And, as I noted, almost without fail, especially early in my career it stood out and people asked me about it – it communicated a lot of things about me in a small amount of words. I was fairly technical, I had even at a young age already done a fairly wide range of things, that I was likely fairly smart (at least smart enough to win a national award and work at Argonne with physicists) etc.

So my advice to my friend, beyond fixing the mostly minor details of her resume, was to think about one thing she has done in her life already which will stand out and which will make someone want to talk with her to hear the story behind it.

As I noted to her the job of an resume which you submit to a company for a specific position (i.e. not a resume submited to a machine for entry into a resume database etc) is to get you in the door, to get you the interview (hopefully the in person interview but a phone interview is at least a good start). From there you will be hired mostly based on the conversations you have and the rest of that company’s interview process – your resume just gets you in the door, you have to then get the job.

I have hired many people in the past decade, made my share of mistakes along the way. And in the course of that hiring I have read a lot of resumes. The successful ones, the ones which lead me to the next step of some form of an interview with the candidate were the ones which addressed the following questions – and which left me wanting to meet that person and ask her (or him) more questions.

1. Is this person passionate about the type of work she (or he) will be required to do? I will never (again) hire a programmer who is not the type of programmer who has to write code who does more than just write code for the job but would and does write code just for fun.
2. Is the person a good fit for the type of company and stage of company? i.e. people leaving very large company corporations are rarely great fits for extremely early stage startups – large corporations allow people to be highly focused but also build up an expectation of a level of external support that is not present at nearly all startups.
3. Will the person be a good fit for the company’s culture and especially that of her (or his) new team? Remembering that often a great fit for a company is someone who compliments the company’s existing teams and adds a new perspective and new skills – having no one who agrees or everyone who agrees are both bad, especially at a startup. But companies each have (or evolve to having) different cultures – one person’s approach and style will be perfect for some firms and horrible for others (Here I wouldn’t exclude myself – my way of working and interacting is not a fit for every company or client I have worked for or with)
4. Can the person grow with and into the company and new roles alongside the company? Especially for a startup, but even for a project team at a large company, people who will be able to take on new roles and grow with the company (and/or team) are almost always better candidates than people who for whatever reason are unlikely to take on new roles in the future.

So what have you disassembled lately?

Setting your rate – advice for consultants

A friend of mine this evening twittered requesting help for how to start a consulting business. I twittered back some off the cuff ideas, but this is a topic I have been thinking about for a while now. At present I am not actively seeking to do consulting work (instead I’m focused on launching a new ad network, Nearness Function) however there is a rate at which I would do some consulting work.

Here is my simple advice to my friend.

Reply to the request to “pick your brain” with three rates. 1 – for an hour phone conversation. 2 – for a full day onsite consulting. 3 – for an onsite workshop (which would usually involve multiple days, preparations and follow up). All to also include expenses (i.e. travel costs)

Of course depending on the type of consulting you want to do and the length of the engagements it would require the numbers of the above units you bill for and agree upon might differ widely – some consultants could add a great deal of value in a single, one hour call, others might require ongoing engagements over many months and even years.

But remember if you are consultant you are not a contractor, your time should be seen as highly valuable and even more valuable should be the value you are providing. In fact the best and optimal consulting arangements usually do not involve explicit time units – instead they are project and results orientated. i.e. “for $x (where x is usually a large number) we’ll work together and launch your company’s new strategy/product/service/etc by a specified date”.

However to get started with an engagement some time pricing can be helpful. But how to set the “hour”, “day”, and “multiday/talk” rates?

To start, realize that whatever rates you set you should aim for being fairly comfortable if you end up only being able to bill 50% of your time in a given year – and for the purposes of simplicity (and to factor in holidays etc) we’ll use 2000 hours as a baseline for how many working hours there are in a year (and yes, most of us here in the US might actually work far more than that in many years). That means whatever your minimal rate is, you should be at least comfortable at 1000x that rate (i.e. 1000hrs of billable time).

My suggestion for a starting point would be to broadly estimate your costs on a month basis. For most people their mortgage/rent is the largest cost, often followed by food. I live in San Francisco, one of the more expensive cities in the US to live in so some of my costs are fairly high, though on the other hand I don’t own a car which saves me a great deal of money each month.

Don’t forget to include yearly costs that you don’t incur every month – for many consultants this probably includes various tools (new computer, printer, etc), travel that is not expensed, conferences & trade shows, business cards, your website, an accountant to file your business taxes, general liability insurance, health insurance, travel expenses (so maintaince on your car if you own one). For your own sanity you should include also some personal vacations, new clothes, gifts for friends, donations to charities your support, funding your annual IRA account etc.

And round up here – build in a cushion to your personal budgeting so you can afford to spend money to save time (I drop off my laundry at the cleaners on my corner and pick it up – my building doesn’t have a laundry machine so my alternative is walking down to a laundromat where my costs would only be slightly lower – but I would have to spend many hours washing, drying and folding my laundry – time far better spent on my business). You should be comfortable taking a taxi when you need to, or buying the flight whose times work best not which is the absolute cheapest (but causes you to waste many hours on layovers, get up/leave at crazy hours etc)

So from these budget exercises come up with a rough target for each month. Then factor in the fact that as a consultant you have to pay taxes – figure that assuming that about 40% of your gross will be taxes is relatively safe (in the US you will have income taxes, state and sometimes city income taxes, the employee AND employer portions of Social Security (that’s 15% right there – though it does cap out eventually – I think just before $100k currently but check with a professional for the current caps), and a variety of other taxes.

What does this mean? If your gross income for the month was $10,000 – assume your net would be around $6000.

Using that as a working number (and for quite a few people you probably can live very well and save money on net income of $6k each month), $10k per month gross gives a yearly target of $120,000, using our 1000 hours estimate that implies a rate of at least $120 per hour.

In turn that implies a rate for a day of consulting of I’d suggest at least $1000

and probably for a multiple day engagement involving preparation (calls and/or in person, a talk or presentation, and some follow up consulting/further meeting) a rate of around $5000

I would actually suggest adjusting these numbers upwards a bit however to factor in our original starting point – following up from an initial request to “bend your ear”.

I would probably reply to that with something like:

My rate for an hour phone consultation is $250, for a full day in person consulting engagement is $2000 plus expenses, and I will do an onsite workshop for $7500 plus expenses.

And then if pressed would explain that the workshop would include phone and/or in person preparations, the actual full or half-day onsite workshop, and a follow up. I would not – however – commit to a written report or the like – rather I would tailor the specific deliverables more closely to the actual goals of the engagement. So I might, for example, offer a workshop and then follow up with the attendees in a few weeks to review their progress and offer suggestions.

Keep in mind also that every client comes with certain hassles – you have to bill them, wait for payment, deposit that payment etc – and often fill our various company’s paperwork, follow up about your bills etc. Not for every client but slow or late payments will happen.

Realize that while the numbers I am playing around with in this post may for many seem high, in point of fact for many consultants they are not high at all – and like lawyers, consultants are frequently valued by the rates they charge. If your lawyer charges you $50/hr you assume they went to community college and may have taken many, many attempts to barely pass the bar – in contrast you assume that the partner at a firm who bills at a rate of $500/hr is significantly better skilled and experienced than the $50/hr lawyer.

This may or may not be the case – but the point here is that the perception of value is in large part created by the price assigned to a person’s time and the advice they are giving you.

So value yourself highly – and price yourself accordingly.

(it should go somewhat without saying, but I will spell it out here nonetheless, that I am assuming here that you really do have a lot of value and expertise to offer someone in the field in which you are consulting. That even in just an hour or two of your time you will be able to help someone – and that given a few days of your time and attention you will be able to create value for your clients far in excess of what you bill. Value can be created directly – helping suggest ways to save money or grow sales and value can be created indirectly by accelerating a process, by helping someone avoid wasting time & money on paths that would not be successful or which would not meet the corporate goals etc)

My own other rule of thumb is that it is rarely worth the effort to enter into a consulting engagement if my invoice won’t be five figures. That said, I could see doing some types of smaller engagements and I would suggest them as ways to work with new customers and build up new opportunities.

One further note about expenses. Expenses as a consultant are somewhat different than expenses as an employee. People’s practices and expectations around this vary – but here is my own personal rule of thumb and how I would feel most comfortable. Ideally, build the expected expenses into the quote and don’t file detailed expenses to the client – so for example if my rate for a workshop was $7500 and to fulfill that workshop I expected to incur expenses of $500 for printing materials for the workshop and $2000 for my flight, taxis, rental car and a couple of nights in a hotel, I would probably just invoice the client for $10k and make it simple.

On the other hand there are times when that will not work – a client might require you to use their travel agents and book at their corporate rate at a nearby hotel. In some of these cases that may also mean the client is going to directly cover the hotel & flight costs (which is then very easy) but if not keep accurate records and invoice accordingly.

What you should not do – and I mean this very seriously is any of the padding or other games so many people do with corporate expense reports. Nor would I suggest abusing the client’s trust with how you incur the expenses. Speaking as someone who has covered expenses for others, I have had people who booked flights at the very last minute, on major airlines, at very costly rate codes (to maximize frequent flyer miles I suspect) meaning that I incurred a $1500 expense for a flight which more typically would have been $500 or usually much less. That left a bit of a sour taste in my mouth as it was unexpected.

Likewise I would usually suggest using a simple and relatively low per diem rate for meals etc rather than lots of breakdowns of specific costs for your breakfasts etc while traveling. And again, best case you don’t have to detail these expenses at all but factor them directly into your rates and quotes to the client.

Above all else, value yourself and the value you will provide – and price accordingly. You do not, really, want to get into nitty gritty discussions about whether you spent too much on a lunch, rather you want to focus on the millions you are helping your clients make – rendering the mere “thousands” you are billing them a bargain.

And I am, somewhat, being serious here – ideally as a consultant you should be helping create a lot of value – and in how you are billing for that value creation sharing in that value to some degree, while also helping create an ongoing engagement, relationship and referrals for further work.

It is hard – a successful consultant must both be able to do great work (usually in a short, time compressed manner) and also sell new development while also reengaging with existing and past customers. Plus, for most independent consultants figure out all the details of billing, tax filing, insurance etc that come with running a small business.

And keep in mind, money can and will solve many of those smaller problems – accountants can be hired as can personal assistants.

Hope this is helpful. And, if you are interested in hiring me, lets talk – and no, these are not precisely my rates.

Networking Advice – useful business cards and other tips

I am an expert networker – I’ve organized networking events for most of the decade, I even run one of the first conferences on the study of Networks – MeshForum. My MeshWalk events have drawn over 100 people to spend a day walking and talking with each other. Here in the Bay Area I make a point of attending many events and conferences, helping out when I can.

As a result I end up with lots of business cards and lots and lots of contacts, connection requests on Facebook, LinkedIn, followers on Twitter, and the occasional other social networking tool.

Here are a few tips for everyone, but especially for entrepreneurs. Some are seemingly simple but even the simplest tips are, I hope useful. I do not always adhere to my own advice, this post is as much to remind myself as to, I hope, educate others.

Tip 1 – a useful business card

I just reviewed nearly 1000 business cards which I had collected over the summer. Almost half or more of these broke the advice I’m about to give – and as a result, I am less likely to follow up with those contacts. Here is the advice: a business card should be easy to write ON and contain enough information to identify who you are & why someone will follow up with you

This means no glossy business cards, no cards with all graphics, no small moo cards (can’t write on them) and ideally no cards with just your name and email address (I have a bunch of these, usually can’t remember who that individual is/why I might want to follow up with them) Perhaps an exception can be made if you are easily googleable – but even then a card with your company name, job title/one line description, and preferred contact means can go a very very long way.

And even in today’s hyperconnected online world, at a minimum include your primary city – when I’m in a town I like to catch up with people whom I know who live or work there, if all I have about you is your email address, I’m unlikely to invite you to dinner or lunch.

And yes, one of my businesses is exactly about this process – Never Eat Lunch Alone. But if I don’t have your city at the very least, I am unlikely to use my own software to invite you to lunch.

Why no glossy paper you might ask?

Tip 2 – shortly after you get someone’s card, write a note and reminder to yourself on that card

And I do mean shortly, as in minutes after you get the card. Jot down the date and/or the event where you met, write down anything you just promised to do (send an introduction, pass along an article, take a look at a beta, more on this point in the next tip). Make a note which product or project you are working on they might be interested in, or even if you didn’t promise to do it someone you know whom they absolutely should connect with. In short, remind yourself what to do when you next follow up.

If they mentioned a mutual contact, make a note of that.

If they added information in the conversation to what is on their card, jot that down as well.

Are they an investor? A potential partner? A competitor? A prospective employer or employee?

When I have a note to myself on the back of a card, I am reminding myself in the future why I have that card. Without it, I am relying on memory and proximity in a jumbled pile to realize when and where we met, and I will likely have to research who the person and company is before remembering why I took their card in the first place.

Tip 3 – don’t be shy about discarding cards from people whom you do not want to follow up with

Of course do not be rude, but if you meet someone and your immediate reaction is “I don’t trust this person”, or you look into their company and realize it is not a firm you have any interest at all in, save yourself future headaches and memory exercises and discard the card as you are going through the business cards you picked up – and do this quickly (if discretely).

In a related point, most of the time you should only collect business cards from people whom you have actually met in person and have a reason to follow up with. Cards just left out on a table or at a trade show booth are much less useful to you, you don’t have as much context to follow up with someone (and most likely they don’t have the context to recognize you from a conversation when you do follow up).

Tip 4 – have your cards with you and exchange them, along with context as you do so

Something as simple as introducing yourself to a speaker after a talk, getting their card and giving them yours means when you do follow up (and you will won’t you! Soon after the event is best, btw!) you can add to the subject or right at the beginning of the message “we exchanged cards at [name of event] and as I promised I’m following up with you to…”

So if you promise someone to make an introduction, or you mentioned a book, article, blog post, or website to someone, follow up on that promise and deliver.

Tip 5 – networking is about giving.

I have mentioned this before in a previous post about networking, but it bears repeating. Always approach networking first and foremost with the attitude that you can help others. Listen to their conversation and think about how you can help them – is there someone at the same event, even someone whom you have just met who they should talk to? Have you recently read something – on or offline – which might be relevant to what they are doing? Do you know someone who could help them (and who, in turn, would appreciate talking with them)? In short, focus on how you can be helpful – while remaining aware of in turn what help you yourself at looking for.

Oh, did I mention that last point before? Be clear when you start networking – and yes this starts with when you set up your business card and get them printed – what your goals for networking are. Do you want to reach investors? Customers? Partners? Employees? Find a new job? Learn about a new subject?

In short what are you focused on as your own needs. Then, does your business card help contextualize you in the context of those goals?

i.e. if you are mostly seeking to network in the context of a new business, your cards which mostly promote your personal hobby of building model airplanes (unless that is also your new business) are most likely not helpful and at worst a distraction. This is not to say that you shouldn’t include personal as well as professional details – but that you should think about the overall context and focus.

On my own card I have some fairly personal elements such as my personal blog (this blog), my twitter and my skype accounts. I do so a number of reasons, one of which is to in part communicate my attention and focus on fairly cutting edge technologies online – there are probably not too many people currently who put their skype and twitter accounts on their card – I am thinking about what else to put on my card and/or how to communicate other new wave networking elements such as my LinkedIn and Facebook profiles – or some more unified ID for myself online.

Tip 6 – convert business cards from paper to digital data quickly and sync the data widely

It almost does not matter which address book you use, but you should be using some form of a contact manager and in turn you should sync that contact manager widely across your frequently (and to some extent infrequently) used tools. Plaxo is a great help here, though there are other options. [full disclosure, NELA.mobi is a business partner of Plaxo, we will be integrating NELA to Plaxo address books for our users]

Increasingly I’m finding Facebook a very useful business contact tool, often my contacts on Facebook share the best and most direct ways to reach them in their profiles, and they often include useful information and details not found on their business cards (personal blogs for example).

A related habit which I am in, though it does take a commitment of time to do this, is to add to the data found on someone’s card when I entered them into my digital address book. Here are the data elements which I ideally include in every contact’s listing:

• Full Name w/gender note
• Company (or companies)
• Title
• phone – noting if mobile (so on sync to my phone I use that for SMS)
• primary email address
• work address (at minimum city, but usually company address is findable online)
• blog or other personal website
• corporate website
• photo [can be hard to find – best is one I have taken or corporate headshot]
• note on when & where we met
• note on why I kept this card (i.e. transcribe notes I wrote on the card)
• short bio – from conference directory, linkedin, facebook, corporate website, personal blog etc
• tags and/or notes about where/how we are connected (i.e. LinkedIn, Facebook, Twitter, ryze.com, same college, etc)

In short I try to write a short but useful to me profile on each contact. The photo and bio, along with notes on when/where we met are to help jog my memory in the future. The keywords and other tags are also to help me slice through and search my contacts. I have literally 1000’s of contacts, the ones which I have built these rich profiles for are the ones which I am most apt to follow up with in the future – they are the ones which are easiest for me to search and easiest to remember why I might contact them.

In the best case over time I’ll add to the notes with some additions and/or add keywords. Many good tools also note some of these connections automatically – noting the emails I have sent to them etc.

I hope these tips help you. Now I have to get back to following up with all the folks I’ve met over the summer, I’m behind in following my own advice.

Networking Advice – non-valley style

I am a geek. Let me get that right out there, in high school and even in college I was not by any stretch the most popular kid around, heck in high school as a freshman and sophomore I wasn’t all that comfortable calling girls on the phone (this was in the late-80’s, long before cell phones).

Why do I mention this?

Well since college I have become a fairly serious networker. I run conferences, organize events, attend many others and close to 100% of my business development happens as a result of the contacts and connections I make at events (and at follow ups to events such as dinners after).

At the closing party for the Mobile MeshWalk I held last March here in San Francisco one of the MeshWalkers told me a story of advice and training he had received from his boss when he first arrived in Silicon Valley. The advice – “don’t spend more than 2 minutes talking to someone at a networking event, look at their nametag and decide quickly if they are worth your time, if not move on”.

He noted that this was horrible advice – and thanked me for organizing an event which broke with that model and tradition – an event which encouraged longer conversations.

In the past week here in Silicon Valley you could have attended a major networking event/party nearly every single night. Last night it was a blogger dinner (at $40 a pop), Saturday it was my friend Scott Beale’s LaughingSquid Paradise Lost fundraiser, Friday night it was the infamous TechCrunch party at August Capital, Thursday night my friend’s at Satisfaction held an office warming, cupcake party. Wednesday I held my MeshWalk Palo Alto.

Leaving aside my own event, which both was different from the others by virtue of being a full day event and which my results from differ because I am the organizer of the event, the other events show both what is great about the valley and what is so very wrong. My friend’s boss’s advice being the starting point.

In the Valleywag coverage of the TechCrunch party one paragraph by my former college editor Owen Thomas stood out to me.

It was the same small talk, the same pitches, and the same scanning of nametags before faces as any other Valley networking event. With one small hitch — partygoers were asked to fill out their own nametags, and most neglected to include their company information. That omission perplexed at least one venture capitalist in attendance. “I feel like I’m walking socially blind,” he confessed. “I don’t know how important these people are to me.” You mean Arrington’s velvet rope-holders let in some hoi polloi who aren’t worth your time, let alone your capital? Quelle horreur!

A few things to note here. One, Owen observes the same behavior I have, the scanning of nametags to judge whether someone is worthy of time spent talking with them. Two, the sense that lacking this context you are “socially blind”. Three, the implication that you should only talk with “important” people.

Let me now give you, the reader, some different advice.

And so you can judge me, some context. I run a conference on the study of networks, most weeks I meet my personal goal of meeting 5-10 new people (and have for nearly over a decade – do the math), my last event, the MeshWalk Palo Alto drew nearly 100 entrepreneurs and investors for a day of walking, was sponsored by Mohr Davidow Ventures, and well over a dozen angels and vc’s participated.

So, my advice.

1. Networking is about giving and listening.

Spend your time when you meet people thinking about how you can help them. Often this can be both very simple and immediate – introduce people who you meet at a party to each other. As you do, mention why you are introducing them i.e. “John, meet Jenny, she mentioned that she’s looking at deals in the healthcare space and you were telling me about your friend’s new medical startup…”

To do this well you have to be listening. Listen not for a pause when you can enter and pitch yourself/company/product/investment opportunity, listen for how you and the person you are talking with can form a connection.

2. Have a very concise, two or three at the most sentence explanation for yourself.

This is something I have to work on, in part because I am working on too many projects at once (three startups, one ongoing non-profit, writing a book on economics). But for all of the projects I am involved in, I can explain them very simply and quickly – in a few simple, easy to understand sentences – which generally get a reaction of head nodding and interest in the project.

Getting to this point is not easy. In many ways it is harder than writing a long business plan. You have to strip away everything that is unnecessary and communicate quickly what you are working on. Without, ideally, doing so in a jargon or buzzword filled manner (I never use terms such as “web 2.0” when describing my projects, even those that are, in fact, “web 2.0” in spirit).

The point of this is to get the introductions behind you and to give someone stuff to continue to talk with you about – give them hooks to a conversation.

3. Parties and events are the starting point, not the end point.

Photos with celebs can be fun. Being on the guest list is always nice. But from a business perspective the conversations and discussions at a party are just the starting point. Make a point of following up with people – in ways that emphasize giving not taking. If while you are talking with someone you mention a book they should read, a person they should talk to, when you get back from the party fire off a quick email introduction or a reminder about the book/website/tool you mentioned. This does not take long but has a very real impact.

4. It is not quid-pro-quo.

Frequently people’s reaction when you do something for them is to try to “pay you back”. There is a strong sense that networking is some form of accounts – that you do favors and then collect on them, that people “owe you”.

Please, break yourself of this instinct. Not the part of it which inspires you to help others, but the part which tries to keep accounts, which tries to weigh whether someone can help you before you help them.

If I were to trace back the links and connections which have, in the past, resulted in business deals and opportunities for me, rarely is the line simple or direct. Usually it is something more like:

I was at an event, got into a conversation with another attendee, we went out for dinner as a group, later followed up via emails, over time those emails led to me participating in an online discussion group, later that led to other introductions, those introductions led to meetings while I was visiting CA, when I moved out to CA those occasional meetings grew more frequent, leading to participation at an event, which led to going to another event, which led to a conversation, that led to a lunch meeting in NYC, which led to a partnership to start three companies this year.

And that’s the relatively simple, straightforward version.

The full, detailed account would take a lot longer to explain – and takes many more twists and turns and mutual introductions and reconnections.

But, by giving back, by helping others via my comments, introductions and referrals, I have gotten far more. Not via direct paybacks, but indirectly.

5. Know what to ask for, and very important, ask for it.

People often ask me, “How do you get…” (sponsors, attendees, speakers, funding, clients, partners etc).

My usual and true answer is “I ask.”

It is amazing how few people do and how often asking the right people for the right thing gets amazing results.

Critically I do not usually ask in ways that only lead to yes or no. Rather I ask for something very specific (will you speak? Can you sponsor this?) but also for something openended “Who else should be speaking? Who should I be talking with about this? What should I read or take a look at?”.

This combination of specific and openended has worked very well for me. The specific leads to a yes or a no (and seriously, getting a quick no is really valuable – the worst result is the indeterminate answer that delays you from asking others). By asking for something open ended you give people a chance to help even if they can’t immediately do your specific request – i.e. if they can’t fund you, they may still help via some introductions, if they can’t make it to your event they may help via inviting someone to go in their place.

Getting to the point where you know what to ask for, however, is hard work. You have to really deeply understand your project and what next steps you need to take.

A few specific examples to help illustrate this.

I have many projects going at the moment. However what we need, for now, is not overly complicated.

– we need specific types of partners for trials we plan for our ad network this fall (publishers, advertisers)

– this is leading to needing serious investment (but for now we’re starting to talk with investors but mostly need to know who might be good fits when we are ready)

– for my next few MeshWalk’s I need participants (in Seattle Aug 12) and sponsors (for NYC in Sept)

– for another project which we are about to launch, we will need the right type of (probably) angel investor interested in content investments (online and to a degree offline)

– for that same project we need to talk with large (ideally trade show sized) event organizers in Chicago or San Francisco

We have other needs – for beta testers, for future hires, for certain types of partners. But, those are my current priorities and thus what I mostly ask for when it is appropriate to ask. And I have what we are looking for down pretty specifically (I can get into details about the trials this fall for example).

Specifics, even if open ended i.e. “who should speak”, lead generally to better results than very vague and uncertain questions.

i.e. don’t ask “can you help me with my startup”

Ask for something more specific. I have a call scheduled later this week with a former CEO who built, took public, and sold a company in a space we’re entering. My call is to get his perspective on our plans and to ask him if he would join our board (at least our advisory board, but very likely after we raise funds our formal board). This is very specific and importantly, he knows why I am talking with him (his perspective and advice would be very helpful plus his association would help as we raise money). I am also going to be asking him specifically about hiring sales and business development people in this space.

I hope this is helpful. Please leave comments with other advice (and feel free to point out alternatives or clarifications to this document).