GRIDANOMICS

Small bands and independent musicians are a group of people who do not have many resources available to them right now. Also, since this particular group is not always obvious, not many start-ups have focused on them.

However, things are changing. Success of websites like cdbaby.com does prove that the group is now turning to the web to find their success.

There are many resources available in the form companies and organizations that promote the individual bands or sell their music. However, there are no services that we know of that work at the grass root level.

BandChemistry.com was formed to bridge this gap. Their website says that they allow members to “make your band, find your sound”. The website helps musicians and bands to find each other so that they can produce the next Beatles or Elvis of the decade.

The service includes a free profile for everyone but one needs to subscribe to see the complete profiles of all members. Paid members also have chance to showcase their music by uploading their MP3s. All other paid members will be able to download their music and in a way, test them out before they approach the members for further consideration. The subscription rates are also very nominal - starting at five bucks for a month to twenty for a full year.

The site is aimed towards both – recruiters or bands that are looking for new members to musicians who are looking for members to join them.

As Thomas Friedman says in his book, The World in Flat, the playing field is leveled now for everyone. There has never been a better time to collaborate on projects and be able to work on projects that previously were difficult to do due to limited means of communication.

The internet has brought many strange people together. People who wouldn’t have known about the existence of others before the internet. We will stay tuned to BandChemistry to see if any great music results from this service. We hope that many will be able to make their band and find their sound!

History, almost always, repeats itself. Down the years, the next big thing has always been something that made the last big thing much easier to use. Windows made personal computers easier, Google made searching the internet easier, IPOD legalized the use of MP3’s, and Blackberries made emails more flexible.

Similarly, grid computing promises to use the power of many unused and underutilized CPUs to crunch data for applications which need it the most. The applications can be on the same machine, somewhere in the networking neighborhood or half way across the world.

Imagine this – what would you do if you could use the spare processing power from your grandma’s PC in the basement or your kids computer to divert to an application that you are working on? It could be a CAD design, an animation sequence, a complex physics experiment, or simulation of a nuclear reaction! That too, all without the use of any expensive super computers or clusters. Sky is the limit to the type and quality of applications that can be used by the Grid to make us more productive.

Grid computing is not a new concept. Many like IBM, SUN, etc. have provided the such services, by the CPU-hour, since years. SETI@home was one of the first projects that made use of the unused processing power of millions of PCs all over the world to find extra-terrestrial life. However, they were not tailored to the needs of individual applications or users.

Moore’s law seems to have peaked in terms of advancements in faster processing technology. At the same time, applications are becoming more complex. More and more processing power is needed to create and run applications especially in the area of research and development. New microprocessor technologies like HyperThreading, Dual Core, etc. are good but not good enough top serve the processing needs of the current day applications.

This is the space that Gridalogy fills in. Gridalogy provides software that can connect many computers on a network to channel collective processing power to applications that need it. The software is easy to use and configure. The system is also smart enough to manage the resources so that the transfer of processing power is seamless and only done when the client machines are not making optimum use of their own resources.

The technology would benefit all - small business and telecommuters who do not have the resources like big businesses do can now have access to expandable and cheap processing power. Big businesses can use their vast infrastructure and reduce their operating and ownership costs by using their unused processing power. Technology focused organizations can also substantially save money on their processing power needs – which currently is fulfilled through big organizations that sell it by the CPU-hour.

Gridalogy also recently released their technology preview – a teaser of what the software is capable of. Details can be found their website.

The era of grid computing has just begun and the best is yet to come!

Industry analysis provides sufficient knowledge of the local, national and international markets that affect marketing strategic decision making process. The industry evaluation often provides valuable insight into the competition and how to position products and services for any company.

Competition analysis can be done by various means. Newspapers, articles, websites, catalogs, interviews, etc. can provide many valuable insights into the competition. As a great warrior once said, keep your friends and family close, but your enemy closer. Entrepreneurs should never underestimate or discount the competition. It explains Google’s exponential rise. Both Microsoft and Yahoo heavily underestimated the power of their search program. Yahoo even gave up a chance to buy Google for a million dollars back in the late 1990s.

The marketing plan of any company should begin with a purpose or objective. Entrepreneurs should do a detailed study of the target consumer market demographics. Knowing the customer and customers need is extremely important for the success of any company. Research should also be done to find out how much the customers are willing to pay for any product, where they prefer to buy their services from, and how can the word about the product be delivered to them in a timely fashion.

Gathering information from primary sources is always important. If the consumers can be polled and if they are allowed to voice their opinions, it can be of great use. It can also mean sending a lot of spam to friends, family and their friends and family. Word of mouth can do wonders.

However, gathering information from primary sources is not always possible or easy. Secondary sources are also a great way to find information about the target market and consumers. A good example is to get the information on the competition and their products and services. Trade magazines, newspapers, etc. provide a great source.

After collecting all the information, it should be tabulated, interpreted and put to use. Data should be viewed in various forms. For example, segregating the information by different age groups, sex, geographic locations, etc. can help the company place its product better. Marketing is usually the major expense for any organization. It’s in the company’s best interest to target the consumers as accurately as possible.

In today’s world, data means everything. It’s the reason why a young, online company like Google is worth more than an old media giant like Time Warner. We live in a new economy.. Old is now not necessarily gold. It might be considered to be extra baggage. AOL considers Time Warner as excess baggage. Ebay bought Skype for a spectacular $4 billion – which is 4.5 times the worth what hard disk maker Seagate bought its competition Maxtor for. While Maxtor is a real revenue generating company, Skype’s revenue was hardly comparable. Skype was bought over for its user base which is nearing 24 million.

The IT industry is now considered to be mature (or is it?). No matter what the case, we should expect great things from it, at least I am!

We at Gridalogy are also working on our business plan. The plan has been a work under constant progress for many months now.

It has helped us to define all internal and external elements involved with starting and running our venture. More often than not it is a combination of marketing, financial, manufacturing and human resources plan. It becomes a road map or game plan for the company. Investors, suppliers and even customers often ask for a business plan. In Gridalogy’s case, we are actively pursuing capital investments.

Since the business plan contains many important business ideas and operation plans, steps must be taken to insure that the plans remain safe. If the business plan is being reviewed by a friend, it’s a good idea to have them sign confidentiality and no-compete agreements.

The material that goes inside a business plan can be found on templates provided by many different websites and also from drones of book available in the market.

We have made many mistakes on our way and have learned from them as well. After referring to many sources and recommendation provided by well wishers and business plan experts, these are the classic mistakes we made.

- Avoid all hokey forecasts: All sudden jumps in sales forecasts should be avoided. It is very difficult for anyone to believe that as soon some investor pours some capital in, the sales will go through the roof.

- Unrealistic Payroll: The founders of the company should account for their salary in the company. If they are being paid in the form of company equity, then the equity amount should be quantified as well.

- Too much Technology: Too much technology can hurt the business plan as well as risk the idea being stolen. Technology is great and some technical information should be added. However, it can also be overdone.

- Relying too much on Patents: Patents do protect original ideas but the plan should also include other ways to protect their technology.

- Buried Information: A business plan should be like a resume. The VCs or anyone else reading the plan should be able to get the upfront. If he/ she is looking for information then it should be easy to find the correct information as well.

- Numbers without Charts: Charts are worth a thousand numbers. They make comprehension of the numbers much easier. Use them as much as possible.

- Astronomical Profits: This goes along with hokey forecasts. Do not make astronomical assumptions about profits in the company.

- Underestimating Competition: Never underestimate competition. If the idea is new, someone else will catch on as well. How do you plan to deal with current and future competition?

- Naïve Cashflow: The cashflow situation needs to be clarified. Never underestimate the amount of money you will need to make the operation big.

Content is still king in a business plan. The format is good but not of supreme importance. Moreover, the entrepreneur or whoever is preparing the plan should have a clear picture about the venture themselves.

Entrepreneurs usually have the entire picture and the plan mapped out in their minds. However, sometimes communication becomes the bottleneck. A successful entrepreneurs will need to overcome these shortcomings.

Entrepreneurship is more than just starting and running a business. It’s a lifestyle that some choose to thrive and survive in. It’s a state of being, that not only helped the world with innovative and better products but can also improve the life of any practioner.

Entrepreneurship and leadership are similar in many ways. Like leadership, entrepreneurship also improves the personal lives of entrepreneurs.

Entrepreneurship teaches everyone to take calculated risks. Risk is a part of living. We take multiple risks everyday. When driving, deciding whether to change the lanes or not when there’s heavy traffic. Or when going on a third date, whether to take red flowers or white flowers. They may or may not mean different things to your date. Entrepreneurial experience helps in analytical thinking. If you take a red rose, there are two things that can happen: either you an upgrade or a downgrade. If you get an upgrade, you could get engaged. Then you might get married as well. If it doesn’t work, well you’ll be on the lookout for other people.

For those who are familiar with Game Theory, something formalized by John Nash, the central character of A Beautiful Mind, this concept might sound familiar. Entrepreneurs are trained on critical thinking. After some experience, they become masters at calculating and mitigating risks.

More importantly, entrepreneurship helps one to take the initiative to do something. Many a times, people have great ideas but there is no action to follow-up. The ideas get lost due to lack of action. The only way to make a dream come true is to wake up and the difference between dream and reality is action.

Time management is a by-product of entrepreneurship training. Entrepreneurs are most productive when they are the busiest. It’s a fact that a piece of work when given to a busy person is sometimes done faster and more accurately than when given to someone who’s not that busy. Entrepreneurs, by practice, learn how to manage time well. It’s a requirement and not a luxury since at any given day and time, they have tens and hundreds of things on their “to-do” list.

Entrepreneurs always find an opportunity in a bad situation. When our business plan got rejected by a couple of venture capitalists, we at Gridalogy thought of alternatives. We got ourselves together and improved our plan. At the same time, we also came up with a plan to fund the company internally for as long as we can. The result was three other companies that we formed so that we could fund Gridalogy.

Entrepreneurship forces organizations to operate on lean resources. More often than not, they end up trying to prove their ideas and have to work on extremely limited resources. Some VCs also believe that the more money that is given to a start-up, the less is the chance of success.

Entrepreneurs have contributed much in the world that we live in. Our lives are touched by their creation every single day. From the most popular operating system to the chip that runs them and from automobiles to energy efficient electronics and a efficient supply-chain system, all have been the innovations of entrepreneurs. You can love ‘em, you can envy ‘em, but you can’t never do without ‘em.

For entrepreneurs, sometime the most difficult decision is to differentiate between ownership and management. Not all entrepreneurs are good managers.

Entrepreneurship also includes much more than starting and growing a new idea. Having a business is like having a baby – it changes everything! There are many responsibilities that come with the domain of running a business.

Entrepreneurs should know when it’s time to step aside and let the business be run by a team that is much more inclined towards it. There are many signs of a management being incompetent and when it should be good to step down.

5. When everyone is working close to double the normal hours without any changes in revenue growth. Revenues remain constant for a long period of time.

4. Employees are being mistreated at for forgivable errors. Management has to come back and apologize for the errant behavior

3. Employees seem disconnected and have an indifferent attitude towards organization

2. The management feels the need to micromanage. They think that their absence from ground zero will deplete the “management” factor from the organization

1. When employees have to fight a constant battle with the management to get any common sense into the organization!

Finally, the entrepreneurs should know that the management has completely gone out of whack when the entrepreneur assumes the role of a dictator.

Management is more of an art than a science. It is important to get the art right. As the legendary Peter Drucker said, “Business, because its function is to create and sustain a customer, has only two purposes: Marketing and Innovation. Everything else is an expense.”

Entrepreneurs should pay close attention to consumer needs. It could be done informally monitoring potential or ideas or formally having consumers express their opinion. Nevertheless, there comes a time when it needs to be decided whether to introduce a product or not.

How do you determine the need for a new product? What points would you consider before you make the decision? Below are the few points you might want to consider:

Need
• Continuing
• Declining
• Emerging
• Future

Timing
• Duration of need
• Frequency
• Demand cycle
• Position in life cycle

Competency in satisfying needs
• Doing without
• Current method
• Modifying the current method

Perceived Benefits
• Utility to customer
• Appeal characteristics
• Customer tastes and preferences
• Buying motives
• Consumption habits

Price vs. performance
• Price-quantity relationship
• Demand elasticity
• Stability of price
• Stability of market

Market size and potential
• Market growth
• Market trends
• Customer income
• Financing opportunities

Once the new product has been developed, it is also important to gauge the value of the new product. A close watch needs to be kept on the product introduction. Changes might be required. If the product is not up to customer satisfaction, then the line might have to be removed altogether.

A few pointers for value considerations.

Cash outflow
• R&D costs
• Marketing costs
• Capital equipment costs
• Others

Cash inflow
• Sales of new product
• Effect on additional sales of existing product
• Salvageable value

Net Cash Flow
• Maximum exposure
• Time to maximum exposure
• Duration to exposure
• Total investment
• Maximum net cash in a single year

Profit
• Profit from a new product
• Profit affecting additional sales of existing products
• Fraction of total company profits

Relative return
• Return on shareholders equity
• Return on investment
• Cost of capital
• Present value
• Discounted cash flow
• Return on assets employed
• Return on sales

Compared to other investments
• Compared to other product opportunities
• Compared to other investment opportunities

It should be the entrepreneur’s goal to find the confluence where the need and value of the product meet. A usable product for the consumer and a profitable venture for the entrepreneur also mean profits that can pay for future enhancements and more.

Everyday, the world is becoming a smaller place. Thinking global is not an option anymore. It’s a requirement for survival. The shrinking marketplace has made it absolutely necessary for each and every company to be hypercompetitive in the global economy.

In such an environment, a successful entrepreneur will be the one who will be able to differentiate and implement strategies tailored towards the global environment. Much homework will need to be done to carefully assess the market and the needs. The following is an effort to accumulate information for strategizing International market entries.

Environmental Analysis

• What are the unique characteristics of the each unique market?
• Can the national markets be clustered together for operation and planning purposes?

Strategic Planning

• Who should be involved in decision making?
• What are the major assumptions about the target market?
• What needs are satisfied by the company’s products in the target market?
• What customer benefits can be had from the target market?
• What are the conditions used under which the products are used in the target markers?
• How great is the ability to buy the products in the country?
• What are the strengths and weaknesses from the existing competition?
• Should the company extend, adapt or invent products for the target market?
• What are the current currency and economic situations in the target markets?
• What are the opportunities, risks and company capabilities?

Structure

• How should the organization be structured to optimally achieve the established objectives given the company’s skills and resources?

Operational Planning

• Given the above conditions, how effectively can a operational marketing plan be implemented?

Controlling the Marketing Program

• How does the company monitor performance?
- Market characteristics
- Stage of development
- Stage of product life-cycle
- Buyer Behaviors
- Social factors
- Physical environment

• Marketing Institutions
- Distribution systems
- Communication media
- Marketing services

• Industry Conditions
- Competitive size and practices
- Technical development
- Legal Environment
- Resources – personnel and money
- Political environment

The word entrepreneurship is a French word which means “go-between” or individuals who take risks and starts something new. In the process, the same also assumes the risks and rewards.

An offshoot of the same is an intrapreneur – which is entrepreneurship within an existing organization.

However, we need to be able to distinguish between the entrepreneurial spirit and management abilities. Though they sound the same they are not. The former involves creating something from nothing while the latter involves running an organization that already exists. Entrepreneurs are not necessarily the best managers and vice-versa. You can often sharpen your managerial skills by experience but that’s rarely the case with being an entrepreneur. Either you have it or you don’t.

The best of entrepreneurs have been known to ruin their organizations because of lack of management experience and expertise. Managers have often killed the soul and spirit of an organization since they lack the ability to think outside the box.

Some skills required for entrepreneurship

Technical Skills
• Writing
• Oral Communications
• Monitoring environment
• Technical business management
• Technology
• Interpersonal
• Listening
• Ability to organize
• Network building
• Management style
• Coaching
• Being a team player

Business Management Skills
• Planning and goal setting
• Decision making
• Human relations
• Marketing
• Finance
• Accounting
• Management
• Control
• Negotiation
• Venture launch
• Managing growth

Personal Entrepreneurial Skills
• Inner control/ disciplines
• Risk taker
• Innovative
• Change oriented
• Persistent
• Visionary Leader
• Ability to manage change

Either way, entrepreneurship and good management are big supporters of capitalism – as Larry Kudlow puts it, “Free market capitalism is the key to prosperity!”

Managing is the process of leading and directing all or part of an organization, often a business through the deployment and manipulation of resources and implementation of strategies.

There are very well known books from authors like Andy Grove, Jack Welch, Tom Peters, and the legendary Peter Drucker.

These books are basically personal experiences of the executives in their daily lives. Throughout their journey, they have transformed their companies and in one or other touched our lives.

One of the best books yet written has never been published. Bill Swanson, Chairman and former Chief Executive of Raytheon wrote a few pointers from his illustrious career. His advice is very valuable and follows the rules of common sense, which is often, uncommon.

The first time this was uncovered was in Business 2.0, July 2005 edition. Mr. Swanson was gracious enough to send me a copy as well. The following are the major takeaways from the tiny book – which I am sure I will be using quite a bit!

• Learn to say “I don’t know.” If used when appropriate, it will be used often.

• It is easier to get into something than get out of it.

• If you are not criticized, you may not be doing much.

• Look for what is missing. Many know how to improve what’s there; few can see what isn’t there.

• Presentation rule: when something appears on a slide presentation, assume the world knows about it and deal with it accordingly.

• Work for a boss whom you can tell it like it is. Remember, you can’t pick your family but you can pick your boss.

• Constantly review developments to make sure that the actual benefits are what they were supposed to be. Avoid Newton’s Law.

• However menial and trivial your assignment may appear, give them your best effort.

• Persistence or tenacity is the disposition to persevere in spite of difficulties, discouragement, or indifference. Don’t be known as a good starter but a poor finisher!

• In doing your project, don’t wait for others; go after and make sure it gets done.

• Confirm the instructions you give others, and their commitments, in writing. Don’t assume it will get done.

• Don’t be timid: speak up, express yourself and promote your ideas.

• Practice shows that those who speak the most knowingly and confidently often end up with the assignment to get the job done.

• Strive for brevity and clarity in oral and written reports.

• Be extremely careful and in the accuracy of statements.

• Don’t overlook the fact that you are working for a boss. Keep him or her informed. Whatever the boss wants, within the bounds of integrity, takes the top priority.

• Promise, schedules and estimates are important instruments in a well-run business. You must make promises – don’t lean on the often used phrase: “I can’t estimate it because it depends on many uncertain factors.”

• Never direct a complaint to the top; a serious offense is to “cc” a person’s boss on a copy of a complaint before the person has a chance to respond to the complaint.

• Praise in public, admonish in private.

• When interacting with people outside the company, remember that you are always representing the company. Be careful of your commitments.

• Cultivate the habit of boiling matters down to the simplest terms: the proverbial “elevator speech” is the best way.

• Don’t get excited in engineering emergencies: keep your feet on the ground.

• Cultivate the habit of making quick, clean-cut decisions.

• When making decisions, the “pros” are much easier to deal with than the “cons”. Your boss wants to see both.

• Don’t ever lose your sense of humor.

• Have fun at what you do. It will be reflected in your work. No one likes a grump except another grump!

• Treat the name of your company as if it were your own.

• Beg for the bad news.

• You remember 1/3 of what you read, 1/2 of what people tell you, but 100% of what you feel.

• You can’t polish a sneaker.

• When facing issues or problems that are becoming drawn-out, “short them to the ground.”

• When faced with decisions, try to look at them as if you were one level up in the organization. Your perspective will change quickly.

• A person who is nice to you but rude to the waiter – or to others – is not a nice person.

• Never be afraid to try something new. Remember, an amateur built an ark that survived a flood while a large group of professionals built the Titanic!

True leaders don’t just have these traits – they apply them and instill them in others. Enjoy the journey!

Though we do not want to make this blog a sales pitch for our products and services, I think an introduction would be appropriate to understand our background.

A nutshell introduction – Gridalogy is a grid computing software company. Gridalogy provides software and services to increase the productivity and efficiency of individuals, large and small companies through the power of Grid Computing.

This venture of ours started two years ago. Like all budding entrepreneurs, we started out small. We recently released the first version of our software. Details of the release can be found here.

We are also looking at funding options since we are also expanding, although we don’t think we are ready for prime time funding yet. We are looking for small funds that can keep us operating for a while we work on our products and services. Our sister companies include Lathia Inc. and iGTech. If you are interested in funding opportunities, please feel free to contact us.

Through this blog, we would like to present our views on Entrepreneurship, Venture Funding, Technology Management, Leadership and Grid Computing. We have learned much in the past few years and would like to encourage and help others become entrepreneurs as well. We believe entrepreneurialism is a way of life! Once an entrepreneur, always an entrepreneur.

Feel free to post your comments on our posts. We would like to learn better ways of growing and running our operations as well!