Reach Out and Find Someone
For more than 20 years, software companies that needed to print user manuals provided steady business for Dan Dour's San Jose-based printing broker, DB Inc. Then clients began putting manuals on CDs. "Nobody was calling, but it seemed so daunting to go through my database and re-cold call," says Dour. Last spring, Dour's wife suggested he try social networking site LinkedIn, which now has more than 10 million profiles.
Dour started by building a simple profile, containing his contact information and a bit about his business. Then he began plugging each of the 4,000 people in his old contact management software into Linked-In's search engine. Once he found a contact's current employment information, he would attempt to reconnect with that person, either by sending a friendly message through LinkedIn's e-mail system or by calling or e-mailing the new employer. He'd then ask his former customer to link to his profile, which allowed him to see the contact's entire network and ask for introductions. "I was skeptical, but within an hour I started locating people, even my original customers from 21 years ago," says Dour. Business from those former clients and their referrals helped Dour stop worrying about going under and instead book about $850,000 worth of business in the last 12 months.
If the phrase "social networking site" brings to mind only giggly teenagers whiling away hours on MySpace.com (NWS ), it's time to think again. Entrepreneurs are using the sites to get advice and recommendations from other business owners. They're also finding employees, meeting potential investors, and attracting customers. Among the sites that provide the most to small business owners are LinkedIn and Ryze—open to those at any size company—as well as JumpUp (INTU ), Go BIG Network, and iKarma, which cater specifically to small businesses. Most of the sites are free, but to get the most out of LinkedIn and Go BIG, you'll need to upgrade to one of their paid membership plans.
Be warned, though, that the sites are of limited use as marketing tools. That's by design. In an effort to avoid spam, each site caps the number of messages you can send to other members. And members have a fair amount of control over how much information they reveal online. That being said, none of the sites screens applicants. And the sites do attract scammers: Message boards on the Go BIG Network include complaints by entrepreneurs who have been approached by crooks promising quick cash in exchange for an up-front fee.
The sites that we evaluated all work in the same way—by letting you create a profile, link to other profiles and networks, and post to various discussion groups—but each does different things well. If you're thinking of starting a new company for the first time, check out JumpUp, created by software firm Intuit. (INTU ) Its many tools include templates for business planning and financial calculators. It also has vendor listings and member ratings. If you've got a business plan and are looking for potential investors, you might try Go BIG Network, which aims to connect startups, investors, and job seekers. Entrepreneurs wanting to broadcast their business' fine reputations might want to investigate iKarma, on which customers review and rate services the way Amazon.com (AMZN ) users do.
LinkedIn, the largest social networking site for business, has 1.4 million small business owners among its members and should be able to help you reconnect with former clients or colleagues, forge partnerships, or hire new employees. Because LinkedIn is so large and has good searching tools, it's relatively easy to find, say, everyone on the site who is a director of information technology. Unfortunately, the site can also feel like little more than a huge database, and it isn't great at facilitating spontaneous group discussions. When you find a promising contact, the site will help you figure out who you know that might be able to broker an introduction—much better than a cold call.
Ryze's strength is probably as a source of advice from other business owners. Its 19 groups for entrepreneurs and 10 for small businesses include those specifically for women entrepreneurs, startups, and even entrepreneurs with attention deficit disorder. Anyone who upgrades his Ryze membership to the gold or platinum level can start his own group. Eva Abreu, owner of Sort Things Out, a startup in Piscataway, N.J., that helps people get organized, partnered with three other women she met on Ryze's Women in Networking group to plan a seminar in June. A customer Abreu met through Ryze was so happy with her work that she later asked her to be a guest on her radio program.
Even with the help of these sites, connecting with people will still take some work. The sites often tell you where a person works, but won't typically display a phone number or e-mail address. JumpUp launched just last fall, and its forums were added in March, so there aren't many contributors to the discussions yet. IKarma has yet to garner the critical mass that can make a reviews site compelling. And at Ryze, it can be tough to navigate through the many small business groups to find the best one for you.
Not much will happen if you simply create a profile and don't join any groups or participate in forums. "You have to work at it at least a little," says Scott Allen, co-author of The Virtual Handshake: Opening Doors and Closing Deals Online. Allen recommends joining a few sites and posting occasionally in discussion groups. "When you have something meaningful to add to the conversation, that's when you should talk—not at any other time," says Allen.
An attitude built on trying to be helpful, rather than trying to extract whatever you can, also helps. Susan Silver, who started marketing consultant Argentum Strategy Group in June, 2006, takes the pay-it-forward approach when using both LinkedIn and JumpUp. "I feel like it's one big cosmic karmic piggybank. The more I can help people, the more good things will come back to me," says Silver, whose company had revenues of $150,000 last year. She recently participated in a JumpUp discussion thread on low-cost marketing tools, though she wasn't looking for advice on the subject. And she says she's been astonished by how many other people on the site have helped her. Last winter, she used the site to ask other entrepreneurs what sort of holiday gifts she should send to clients. The response: send handwritten notes instead. Silver did, and says the notes, in addition to being cheaper than gifts, made more of an impression.
Social networking sites can even let customers vouch for you. Mario Costanz has asked some clients of his $450,000, 12-person accounting firm, New York-based SmartServ Solutions, to post reviews of his service on iKarma. "A lot of times people will search the Internet to find out the reputation of companies they do business with, and iKarma helps us because it shows we're credible," says Costanz. Anyone doing a Google (GOOG ) search on Costanz' name will find him, and his company's 38 stellar reviews, on iKarma. And Costanz is a firm believer that good karma is good business.