Raman Chadha, Opportunity Amidst the Chaos: Trends from the Trenches

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The Talk: What’s happening at the street level during these tough times? What is the outlook amongst people who invest their own resources into creating organizations, jobs, and communities? Why and how are some companies actually thriving during this recession?

Raman Chadha will share some fascinating insights and trends that he is learning about through a series of interviews with people from Chicago’s entrepreneurial community – entrepreneurs, investors, and community leaders. He will also discuss why this primary market research is being undertaken and how it will be used.

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  • withstand setbacks: economy, lawsuit, stealing; too much focus on growthFight b/w growth & stability; in 30 yrs, learned it’s slow & steady Go to vendors & ask for discountsPick up good peopleJacoby: able to answer customer problems in meaningful ways; not me-tooMarket is more demandingMost look out 60-90 days; we’ve been looking out 6-9 mos: huge difference todayRepking: stay focused; don’t get distractedGet help, seek adviceSentiam: startup in large industry: good b/c nimble, adaptable, bootstrappable; build resilience into DNA & cultureOutsource; reduce capital inv’t; patents, evangelistic customersBanker: those who arent’t affected are well-managed with limited debt; well-capitalized; have niche or specialized/differentiated product
  • Will be blogging about thisWed Feb. 18: how to work with entre’s panel discussion
  • Why I’m doing thisSelfish: resilienceBusinesses: resilienceStudents: resilience
  • We think it’s all doom and gloomIt’s not; I’m learning that first handSo far, what I’ve learned is amazingly positiveNot all roses, but cerainly not what hearing in press
  • But it is time for cautionWe are living in time of uncertaintyBut as someone who’s been around ent’s for 14 yrs, Ability to cope with uncertainty & ambiguity-Everyone is careful with money: how is that opp’ty for you?Companies will go out of business: will yours be one? (one guy blew his brains out)
  • THINGS AREN’T AS BAD AS THEY SEEM OR SOUNDEhrenreich: sales up 30% over last yearHanna: busines is huge; our numbers are triple of last year b/c of focus, product, better technologyMktg agency: “business is going well”Turner: “Business is good; we hit our 2008 goals, hired 30 people, and this yr going to plan so far”McGough:” we’re benefitting from downturn”; good growth but not as dramatic as prior yearsSentiam: “we haven’t been affected on customer side”“people we’re around are positive”, ‘have enthusiasm’Banker: only a few that are geniunely struggling
  • People separating what they need from what they wantEhrenreich: “people are wearing the same sweater they had last year”Angel: people are holding onto money; a lot of talk, little action; don’t have liquidity; keeping portfolio by re-fundingNeed to have revenue or positive free cash flow; ideas not getting funded muchTurner – what segments are in cash conservation mode & how can you be substitute to themMcGough – getting capital much harder; valuations mean nothing (SaaS, minor league teams, pre-owned cell phones)
  • Dig your well before you’re thirstyAvg. 3.5 networks/personThose networks are now paying offRepking: “Network as much as you can”Jacoby: “was late to the game, to my detriment”Ehrenreich: “finding what I need through network”: staff, customers, suppliers, favorable termsHanna: it’s my biggest asset, not cash, not product, not customers, my networkSO LET’S MOVE TO ADVICE THEY HAVE
  • learn, do, adjust- passion is necessary but not silver bullet; Donny Deutsch was doing disservice: e’ship is NOT sexy; you cannot get rich quick; no wonder it’s on hiatusKnow: expense side; “we spent too much money 1st 3 yrs b/c we were naïve: figure out how to mitigate your naivete; play accountant more; build fundamentals of businessRead, attend, networkFin’l models, cash mgmt$15M+ firm: learning from inv’t bk; not for now, for laterGo: stop talking, start selling; no business if no customers; aren’t in business until you have customers; if you can’t sell it, don’t have a businessGet bankable; watch your cash flowFlow: figure out how to constantly lose/mitigate naiveteDon’t be one-trick pony
  • Be more aggressive; be more creative-Ehrenreich: no banking & auto; rental co’s – where are opp’ties? - what’s on people’s minds? Economy & politics - trade deals: will save $100K + in expenses this yr (lodging; tent rentals) Repking: not only software platform but SaaSHanna: outlast, outsmart, outcompete the others you will have 3-4 main competitors: focus on themBe patient to keep going and going; don’t give up if you can afford itMake your product better and betterBe competitive with price/valueCash flowBe bankableMust be cash flow positive b/c banks will pull creditMaximize gross marginsFind ways to get into cash business
  • Raman Chadha, Opportunity Amidst the Chaos: Trends from the Trenches

    1. 1. Opportunity Amidst the Chaos: Trends from the Trenches Raman Chadha Coleman Entrepreneurship Center DePaul University
    2. 2. sil’ re iencen. the capacity of an entity or system to maintain and renew itself particularly in the presence of stressors
    3. 3. cec.depaul.edu Raman Chadha Coleman Entrepreneurship Center DePaul University

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