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Phantom Partners

Everyone is a phantom partner in a local economy; you may not always see each other, but every business, professional and entrepreneur is partnered through the shared resources of the community. Small changes lead to larger ones and if SMB’s would open themselves to the possibilities offered by new technologies we’d see a transformation that would make the rising sun of the Renaissance look dim in comparison.

Putting Together the Pieces

Matching up business and technology has historically been a difficult process. This may still be true at the corporate level, but is it necessarily true for SMB’s?

While it’s difficult for large corporations to change course, SMB’s have the ability to quickly adapt to new challenges. As always, innovation happens at the local level first.

How can SMB’s utilize the current economic situation to finally fit all the pieces together?

Local Business Can Save the World

With technology available that can drastically cut costs it seems immediate adoption is the only solution.  Fortunately the very same technology that cuts costs can bring community partners together in ways that weren’t possible 10-20 years ago.

A recent article from the Financial Times by Glenn Hubbard (which we discovered courtesy of @bernardmoon via Twitter) highlights the special place that SMB’s hold in resolving the current financial crisis. One of the only ways for SMB’s to remain strong and vibrant is by quickly adapting to the partnership opportunities offered through New Media and shared service technologies.

What’s Your Perspective?

We see things from the perspective of a colocation provider and ISP so connecting businesses and communities is second nature to us, what’s your perspective?

Here are some links to TED (Ideas worth spreading) that take a deeper look at connecting communities as well as some organizations in the U.S. that are taking action:

TED, Ideas Worth Sharing
TEDGlobal 2009
Connecting Communities in New York
Connecting Museums & Communities
Even the Smithsonian is jumping into New Media
UK Official Twitter strategy

Have you heard of any other initiatives? Let us know.

Possible Effects

Gordon Brown, Prime Minister for the UK, recently addressed the TEDGlobal conference in Oxford. His comments on Global ethics in a connected world are even more powerful on a local level.

He asks what the possible effects would be if “the power of our moral sense (was) allied with the communications facilities we have”?

Global Voices, Local Connections

We marvel at communicating with people in China on our iPhones, but in looking so far afield we’ve lost sight of our own back yard. The same technologies that let us communicate our ideas on a global scale are far more valuable in connecting us to the shared experience of our neighborhoods and communities.

What can we do to better equip our communities to begin this kind of dialogue? What can we do on a personal level to insure our worldwide communications networks are mirrored in our local networks?

Building a Base

The power to connect with each other in a shared economic and technological network is a wonderful tool. SMB’s need to leverage and build these networks to insure that the communities they serve remain solvent in these trying times. Entrepreneurs need to build a base, a solid platform, for these initiatives to take off in their communities and then the world.

This great article from the New York Times (posted by @valdiskrebs on Twitter) goes into some of the challenges and rewards that businesses are seeing from collaborative efforts:

Netflix Competitors Learn the Power of Teamwork

What can we do as entrepreneurs and business owners to help foster collaboration not only in our industries, but also in our communities?

Check back later in the week when we’ll talk more about these relationships in a post titled, Phantom Partners.

A Teenager in Eastern Iowa

A teenager in Eastern Iowa working at a gas station can run an internationally relevant SMB on the side with today’s technology. Sounds farfetched, but a 25 year old is running a burgeoning media empire, while working for EMC2 on the side as a marketing advisor, thanks to his internet savvy and use of shared services.

Why don’t more established SMB’s take advantage of the options in front of them?

The growth of ‘cloud’ computing and software as a service (SAAS), not to mention outsourcing solutions like O-Desk and crowdsourcing solutions like social media, are leveraging the need for immediate business solutions even when the upfront capital isn’t there for long term investments.

Community at Work

Using any remotely hosted service, whether it’s a data center or a social media platform like WordPress, allows you to reap the benefits without the expense of running it in house. It also helps other SMBs in your community leverage the same computing power.

By sharing the cost across multiple organizations the service provider is better able to keep up with constantly changing needs of a high technology environment. On the client side, businesses are able to get top notch service at lower cost.

What about us?

So what are we as business owners and entrepreneurs doing to help build and support this network? Maybe we’re not teenagers anymore, but what can we do to turn our businesses into powerful tools for the social good on par with all those teen tech giants out there?

Here are some resources for businesses looking to understand the Shared Services model:

Shared Services & Outsourcing Network
Dana Gardner at ZDNet on Shared Services and Cost Cutting
Deloitte’s Shared Services Resources
Wikipedia Shared Services

Armstrong’s Missing ‘A’

It’s hard to imagine with all those tweets, FaceBook posts, LinkedIn status updates, emails and blog posts that the little mistakes really make a difference. What’s a few grammar errors, factual flubs or poorly worded paragraphs amidst the noise, right?

If you find yourself thinking this, it might be time to step back and reconsider your marketing plan. What exactly are you going for if the small details don’t matter?

Neil Armstrong’s famous words weren’t just an off the cuff remark, they were a well planned strategy to set the media stage for U.S. dominance of space during the cold war. When the public (and the international media) heard him announce “One small step for man, one giant leap for mankind” some were puzzled by what seems to be a redundant statement.

There was something missing, a little ‘A’ which would have helped the message make sense.

Radio Glitches

All it took was a radio glitch to turn a well placed media mark into a 40 year grammatical gaff. Everyone still remembers the line, but four decades of snarky grammar comments could have been averted with just a little more care.

This is a great lesson for businesses that use social media, if you’re spending time pushing content into the social media sphere why not keep an eye on the quality of what you’re putting out there.

A Few Helpful Reminders to Keep in Mind

•    Matsuo Basho, 17th century poet and Haiku master, said that every letter should be written as if it were meant to last through the ages. This may be a high mark to set for your Tweets, but it’s better to keep it in mind than to forget it and end up regretting one of your 140 character outbursts.

•    Editing is easy before you send something out, dealing with mistakes after the fact isn’t. This is something that’s been repeated so often it’s surprising there’s still a problem (I admit I’m not perfect in this regard either).

•    Make sure your links work. I received an email invitation from a PR firm for a webinar on pitching that contained broken links and obvious editorial mistakes (half sentences that were probably meant to be cut). How likely am I to pay to attend this seminar?

•    Remember relevance. It’s one thing to lighten your content from time to time; it’s another to float off into space. Keep things moored on solid ground and you’ll give people a place to go rather than an opportunity to miss you while they look at the stars.

•    Context is more important than ever. When there is so much information streaming across the internet it’s easy to lose site of the past, don’t add to this problem by missing an opportunity to add valuable historical context to your social media efforts.

XNet Announces Silicon Prairie Social

XNet is proud to announce the next Silicon Prairie Social, to be held on Tuesday, April 28th at Arrowhead Golf Club in Wheaton. We’re looking forward to gathering again with a couple hundred friends and associates from the technology community.

If you’re an XNet customer or are looking at XNet to provide your colocation or dedicated server hosting service, by all means, come to the event and connect face-to-face with us. We’d love to have you there.

For details and to RSVP, visit Silicon Prairie Social.

XNet honored with Business Ledger Entrepreneurial Excellence Award

Arthur Zards		Brian Clark

XNet is proud to announce that co-founders Arthur Zards and Brian Clark are recipients of this year’s Innovation Award from the Business Ledger’s Entrepreneurial Excellence Awards. Zards and Clark were honored alongside other award recipients at the Ledger’s awards reception held October 19 at the Chicago Automobile Trade Association, and were included in a special insert in the October 29 issue of the Business Ledger.

For further details, see the following Business Ledger articles:

• Birck Lauds Entrepreneurs as 25 Are Recognized
• The Business Ledger: Twenty-Five Execs Named Recipients of Entrepreneurial Excellence Awards

About XNet

XNet is a privately held, industry-leading Internet solutions provider located in the heart of the Silicon Prairie in Lisle, Illinois. Since 1992, XNet has been instrumental in growing Internet technologies in the Chicago area, and is now the largest independently owned Internet service provider in Chicagoland.

By maintaining close client relationships and a distinct understanding of tomorrow’s technology, XNet has been the leader in Internet solutions for Chicago’s top corporations. XNet’s client list is essentially a “who’s who” of the technology elite, including Blaupunkt, BP Amoco, Lucent, Argonne Labs, Bosch, Abbott Labs, Motorola, and the Morton Arboretum, just to name a few. XNet was founded in 1992 by Naperville Central High School graduates Arthur Zards and Brian Clark.

Media Contact: Ben Bradley, PR Counsel for XNET, 630-221-9844 or benbradley@bwmginc.com.

Contact: Arthur Zards, President, XNet, 630-983-6064.

XNet hosts successful first Silicon Prairie Social

There are a lot of tech businesses in the western suburbs, but no real sense of a tech community. Downtown Chicago has its events and associations, but where are these things along the I-88 corridor? That’s why we hosted Silicon Prairie Social last month at Mullen’s in Lisle.

Building a community doesn’t happen within a single event; the relationships that bring professional growth, business deals, and new opportunities are built up over time. The first Silicon Prairie Social was a step in the right direction, and we couldn’t be happier with the results:

• Over 200 attendees – many of them successful entrepreneurs, executives, and high-level technology professionals
• Great feedback on the quality of networking, thanks in part to the innovative “I Need” and “I Know” name badges that encouraged conversations.
• High compliments on the location—I-88 and Naperville Rd. are central to DuPage County, and the location made for an event that was accessible for people who can’t easily make downtown events in the evening.

See some photos of the event here:

To find out when we’re holding the next Silicon Prairie Social, visit the event’s web site and either add the RSS feed to your reader or sign up for the mailing list (right sidebar, below the sponsors).

Is your kid a “Lemonaire?”

I just found a link to a bank in Oregon who is running a cute little promotion–offering a lemonade stand kit and $10 “startup capital” to kids under 13 who want to run a lemonade stand. Their web site comes complete with a cute promotional video, ranging from the “business plan” to “the pitch” and lessons learned. Check it out:

www.lemonaire.com

Learning by doing: An interview with Arthur Zards

Ben Bradley (benbradley@bwmginc.com) interviewed Arthur Zards, our co-founder and President, on his best and worst decisions in business. We’re re-printing the interview with Ben’s permission. Check out Ben’s blog at www.benbradley.net.

Learning by Doing - Five Thoughts
by Ben Bradley

Learn about entrepreneur Arthur Zards’ worst and best decisions. Following the market both up and down.

Arthur Zards, president of XNET, a regional ISP, spent the mid-1990s building a business in one of his partner’s parent’s basement. In 1999, XNET was sold to Winstar Communications. In 2001, when Winstar filed for Chapter 11, XNET’s founders, neither of whom knew aything about bankruptcy, decided to buy XNET’s assets. In the process learned valuable lessons about planning, growth and following the market.

How did you get started?
Arthur Zards: Back in 1985, Brian Clark, one of XNET’s founders, was running a BBS [bulletin board system] out of a parent’s basement. I was in high school and started helping because I was really into computers. In ‘92, we decided to offer Internet access via a dedicated 14.4k connection to UUNet. Our timing was perfect. Customers and growth allowed us to quickly bring on 24 employees by 1999.

What were your worst and best technology decisions?
Zards: My worst decision was following the market. Unfortunately, I don’t think anyone could have anticipated what would happen to the telecom market. In 1999, the market was really moving. The big telecom companies were buying everything in sight to gain market share and capture customers. At the time, conventional thinking for small ISPs told us to get acquired or die. The big companies had the marketing dollars and the power. The market was telling us the time was right. In 1999, we received five offers and finally decided to merge with Winstar Communications. To protect our customers from the rapid merger, we demanded that XNET remain autonomous for at least one year. Winstar gave us two years of complete autonomy. This decision, in hindsight, was a good one. In fact, it saved our business. By holding off on integration, we were able to maintain our identity, infrastructure and customers with virtually no interruption or change in operating procedure.

What was the result of that decision?
Zards: A lot of good things happened as the result of this decision. It was nice to have the comfort of a large corporate parent. Life was easier. Benefits, payroll, employment decisions were all handled. We were able to give our employees great benefits. And, we were no longer personally liable. And like all Internet start-ups, Winstar threw great parties. Everything was first class. We felt like royalty. Plus, it was a cash and stock deal — the future tends to look bright when you have a pocket full of money.

When the market turned, there was a packet of papers from Winstar sitting on my desk. It included my layoff, layoff instructions for the staff and the notice of bankruptcy. Everybody was going to get laid off, myself included, and it appeared as if every customer would be completely ignored. If you start a company in your basement and manage to survive for eight years, you develop great relationships with your customers. You don’t want to see them dropped. The night before the layoffs, on a long shot, we had our attorney contact Winstar and offer to buy everything back. That phone call got the ball rolling. We knew nothing about bankruptcy or buying assets. It took about nine month to close the deal. Now, I know more about bankruptcy than most would ever care to know.

We’re running the business now the way we should have been four years ago. We’re more efficient, using a lot more common sense and, unlike the Internet boom days, we actually know where all our money is coming and going! Plus, we bought the business back for far less than what Winstar paid us for it - so we’ve got that going for us.

Looking back, what could/should you have done differently?
Zards: That’s easy. Next time someone buys my company, I’ll ask for all cash.

How has failure impacted your personal life and what did you learn from the experience?
During that nine months, I went through a tremendous amount of stress and anguish. That was the most difficult period of my life. Nothing against lawyers, but eight hours a day with attorneys will break even the strongest entrepreneur. Another six hours a day went to repairing vendor relationships. There were a dozen key vendors that we had to convince to stick with us. If all 12 vendors weren’t on-board, the entire house of cards would crumble. XNET was owned by Winstar, but since we were autonomous we had our own vendor relationships. We’d get an invoice and pass it to the corporate office for payment. And while XNET might have owed Ameritech $1,000, Winstar might have owed Ameritech $100,000. Ameritech sent us the bill for the entire amount. Negotiating with vendors while trying to convince them that we were going to pull out of this mess was draining. On top of that, another company was trying to buy XNET’s assets. And even worse, even if it all came together flawlessly, someone else could still steal it away through the public bankruptcy bidding process. The stress was unbelievable.

When everything fell into place, our earlier demand to remain autonomous proved to be a lifesaver. Our autonomy enabled us get back on our feet extremely quickly, if we had been integrated with Winstar, our re-purchase of XNET would have been impossible.

I learned that no matter how easy a decision, always have a back-up plan - if we didn’t have that, we would have been unemployed and on the street like everyone else. Even today, for any big decision, we always go through the “what if” scenarios. That single call to make an offer to buy the company back from Winstar saved our jobs, our customers and the jobs of most of the people who built this company.

Do your customers trust you?

While going through the inbox on my desk, where mostly trade pubs and “things to read later” collect, I uncovered this gem of an article from Forbes.com published in late May–the title reads simply “Do your customers trust you?” Even though the article is written towards financial advisers, we can generalize this to all service providers. The most poignant bit is where the author discusses vendor and customer perceptions of the services provided:

The State Street/Wharton survey found that while trust was clearly important to both advisers and their clients, each side had a different take on the building blocks of that trust. Nearly three quarters of both groups cited trust as the most important characteristic of a financial adviser, but the big discrepancies were in performance and cost-per-service. Just 4% of the advisers thought performance was the most important selection criteria, compared with 10% of the clients; only 5% of the advisers voted for cost, versus 12% for clients.

Those differences may have had something to do with the two sides’ perceptions of overall satisfaction. Advisers clearly have a higher opinion of their services than customers do. A whopping 56% of the advisers felt that their clients were “very satisfied,” while only 24% of clients concurred; meanwhile, 6% of advisers felt that clients were “somewhat satisfied,” a far cry from the 28% of clients who felt that way.

Obviously we skew perceptions to favor our position (it’s called Confirmation Bias). We, whatever our role–vendor, client, spouse, friend, student, etc–want to confirm what we believe, or want to believe, about our relationships. What vendor doesn’t want to believe customers love their product or service?

At XNet, though we’ve enjoyed tremendous customer goodwill over our company history, we haven’t been as conscientious as we could be in soliciting customer feedback. So, for all of the XNet customers reading this–do you trust us? Why, or why not? Let us know. And if you aren’t an XNet customer, try asking this of your customer base; if you don’t hear what you want to hear, take it as valuable feedback to help grow your business and an opportunity to deepen client relationships.