THE POWER OF UNFAIR ADVANTAGE
How to Create It, Build It,
and Use It to Maximum Effect
By John L. Nesheim; Free Press; $30.00
Get People to Talk
About Your Stuff
By Mark Hughes; Portfolio; $23.95
Entrepreneurs, listen up! Tech entrepreneurs, that is -- especially those who hope to get venture capital one day. John L. Nesheim, CEO of Nesheim Group, a consultancy in Carmel, Calif., has coached more than 300 ventures that have raised more than $2 billion in financing. His new book, The Power of Unfair Advantage: How to Create It, Build It, and Use It to Maximum Effect, is a must-read.
Nesheim's unfair advantage isn't just creating a better, cheaper, or faster product. It is a constellation of standout qualities in a company's focus, execution, core management, employees, and expansion strategy, for starters. Through well-known examples -- Dell (DELL) and Intel (INTC) -- and less well-known ones, such as RakShaw Engineering, Nesheim dissects the workings of unfair advantage. How to tell if your product or service has it? Ask yourself these questions: What else is similar? How easily can it be copied? How hard is it to maneuver around? Entrepreneurs must next tell a compelling story about it, one that can ignite an investor's interest in an elevator pitch.
Nesheim then takes his maxims apart and walks you through them. He tells how and where to seek your unfair advantage. Once you think you've got it, he has trenchant advice on how to form a startup, hire the right people, create a credible business plan, and attract venture capital. Nesheim includes his own checklists for evaluating written plans and presentations and tells you when to seek funding and what to expect once you have it. Take, for instance, your own longevity as CEO: "Experience will show that as soon as you have one employee and one investor, the company is no longer yours."
The last third of the book is a collection of the author's insights about technology trends and how giant companies, business schools, and even countries exploit unfair advantages. While provocative, these chapters are not nearly as hands-on useful. But the eight appendixes are a gold mine for first-timers, offering full-blown examples of a business plan, valuation tables and graphics, a discussion of marketing vs. selling, and how to flog your unfair advantage in a press release.
If you're a techie with dreams of becoming the next Amazon or Palm (PALM), you'll want to read this book. Those planning on starting businesses in, say, industrial fencing or party tent rental, will just have to extrapolate to their industry. After all, doesn't every entrepreneur deserve an unfair advantage?
To Mark Hughes, guerrilla marketing is "buzzmarketing," a low-cost, highly effective way to "get people to talk about your stuff." His book, Buzzmarketing, is all about buzz: what it is, why you need it, and how to get it. Small companies should listen, he writes, because buzz is talk, and talk is cheap.
Hughes, a former Pizza Hut (YUM) and Pep Boys (PBY) marketing executive, says creating buzz means knowing which buttons to push. "Screw convention," he writes, "it's all about attention."
As inspiration, Hughes presents great moments in buzz creation, from the selling of the Ford (F) Mustang and Apple (AAPL) Macintosh to the buzz mileage that American Idol gets from its controversial judge, Simon Cowell, or that Britney Spears got by kissing Madonna on MTV.
Then there's Hughes' own coup. In 1999, as marketing vice-president of startup Half.com, which sold overstock and used CDs, DVDs, and books, he persuaded the town of Halfway, Ore., to rename itself Half.com. In the "I'm cool" prose style Hughes occasionally lapses into, he calls this feat an "ass-on-the-line" experience, a "story of ascending to a higher plane of thinking to demand creativity" that put his company in the headlines and on the map, literally. The ensuing avalanche of publicity led Time to call the gimmick "one of the greatest publicity coups" in history. Twenty days after launch, eBay (EBAY) called, and soon after it bought Half.com for $300 million.
Hughes' recipe for buzz is deceptively simple. As he points out, what makes it work is creativity, and that's hard to come by. If at times this book seems facile, there's enough savvy behind the bluster to make it worth a read.
By Marilyn Harris