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Sweat, Spending, and Serendipity

By Phil Lotane

PRUDENCE VS. SALES. Successful entrepreneurs wisely tend to be frugal, especially in their early days, but new companies must loosen the purse strings in some areas to effectively sell their services. We were convinced from the outset that we had to act like a "real" company to convince senior executives to hire us. This is especially true for companies with little or no track record, and likely more important for services companies than product companies.

Establishing your corporate identity is also important, not only from a marketing perspective but for making effective and confident sales presentations. Paying a designer to develop your company logo will give you consistency and a professional presence.

Fortunately, you can produce impressive collateral materials "in house" with a modest investment in a color laser printer. Sure, you can get 1,000 business cards for $10, or build a Web site for $49 (we initially did the latter), but as soon as possible, spend a bit more to get materials that show you are serious about your endeavor. Talented free-lance Web site designers, like graphic artists, are still very affordable, allowing companies to get a professional look for relatively short money.

Of course, an award-winning Web site and snappy graphics won't mean anything if you don't back them up with excellent service, but your promotional materials should reflect the quality of your company, not detract from it. Professional-looking materials will also give you added confidence when selling your company and your services. Colleagues with mature service businesses warned me that even our friends and closest contacts would not take us seriously until we were in business for at least a year. While that may be an oversimplification, there is some truth to the observation.

In our case, we often compete against -- and distinguish ourselves from -- solo practitioners or contract professionals who may simply be "consulting" until they find an attractive full-time position. Early on, we had to establish that we were not similarly looking for the next-best thing, and that we were committed to building a professional services firm. Our corporate identity approach was one important component of that effort.

DON'T DISCOUNT SERENDIPITY. As with many things in business, great sales opportunities sometimes land in your lap when you least expect it, and in ways you never could have planned. A month into our existence, we landed a great client (and one that remains the largest of our 30 clients) through a chance encounter at a cookout.

My partner and co-founder, Jim Jordan, was at the cookout and was, as always, in sales mode. Someone asked him if he had approached a mutual acquaintance at a venture-backed company. Jim had worked with the mutual acquaintance at a previous company, but had not been in touch for a couple of years. Jim called the next morning. We had a meeting with the CEO and COO the next day -- and within a week had signed an agreement.

The encounter was serendipitous largely because of the timing: The company was close to hiring a controller and might not have engaged us if they had. Instead, they liked the fact that they could have a part-time CFO and a part-time controller under our model, and that we brought to the table other services and business contacts. We won the engagement with our value proposition, and we've kept it by delivering excellent service, but the initial meeting might never have happened without a good bit of luck.

Hard work and consistent effort often beget serendipity. Industry networking events and seminars are a good example. People can and do disagree on the ultimate value of attending such events, but you'll likely come away from almost every event having met at least one person worth pursuing. And, occasionally, you will get an excellent lead at the event you nearly skipped. As with cold calling and direct mail, it's a numbers game.

Phil Lotane, 42, is a co-founder and partner of Venture Advisors, a consulting firm that provides finance, legal and human resources services to small and midsize companies, including high-tech and venture capital-backed businesses.

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