Entrepreneur/blogger/author Jonathan Fields has a post today asking for opinions about whether there’s truly such a thing as “critical mass” in business. He writes:

“In business, it’s the moment your client base begins to grow largely by referrals or word of mouth. In publishing, it’s the moment you’ve got enough readers who love your work that the impact of their voice outstrips the impact of your marketing. In blogging, it’s the moment that you move beyond having a small number of friends help promote a particular post or idea and watch it just explode across social media.”

I replied on his blog (and revised slightly since this morning to present here):

“I think critical mass works great in nuclear explosions but I am not so sure about in business. Yes, there are certain franchises (everything from McDonald’s to Seth Godin) where the brand has momentum and velocity–all those physics-y terms that go with critical mass. But McDonald’s still has to spend $100 million a year on advertising, and Seth still has to blog every day and write brilliant new books to keep the momentum going. If critical mass in business were really true, Mickey D and Seth would be on a beach somewhere. Or maybe not. Good question though.“

And now I’m giving his question more thought. I think if you pinned me down for a real answer that was not so flip, I’d say there is no such thing as critical mass in business. The concept implies a chain reaction that takes off by itself and produces more energy. I think any business, big or small, needs more and more and more and more and more and more energy to sustain itself.

When businesses think they have hit so-called critical mass, when great stuff starts happening without their having to do much, that’s when they start failing and other companies start taking their market from them. Can you think of a dozen companies that were market leaders, hit critical mass, then let competitors start eating their atoms? I’ll start the list, you finish: Dell Computer, Microsoft, General Motors, Yahoo!, Starbuck’s….

Few small businesses get to the cruise-control stage like the aforementioned big guys. We all want to live by the example of The E-Myth and work on, not in, our businesses. In most cases that happens, at best, some of the time.  Startups with one or two employees, virtual companies that operate with subcontractors, and even firms with a few dozen employees are usually fueled by the owner’s vision and work ethic. The owner delegates a bit, but re-engages frequently, even in the smallest processes, because the links in the critical mass chain get messed with by others and the process gets out of control. This isn’t because the owner hasn’t hired smart people or because the owner can’t delegate. It’s because business is inherently a difficult process with many moving parts, and the person who owns it has a special relationship with those parts.

Some break through to be huge and scaleable, but the vast majority are highly resistant to things done in a mass of any kind, critical or otherwise. And that may even be a good thing. It assures quality, even if it also assures that the business may never get to be huge. For many small business owners, it’s not about being huge, it’s about being in control. Can I get an “amen” for the people who are okay working IN their businesses without apology to anyone. AMEN!

Jonathan, thanks for a provocative post. I always like that you ask your readers for reaction, so I’ll do the same here. So who has it right, me or Jonathan (whose book, Career Renegade, is now out and definitely worth a look for aspiring entrepreneurs), or is there another way to look at the question?

Who came up with that phrase? Anybody know?  I really like it. I was on the phone yesterday with Michael Haith, CEO of Maui Wowi International. I became a Maui Wowi Hawaiian franchisee seven years ago. Michael and I haven’t talked in over a year. A few days ago he left a comment on my blog and we got back in touch. We got to talking about how my franchise was going (the answer: great), and about the book I have just finished writing, called Franchise: Freedom or Fantasy, which will help people make better decisions about whether to buy a franchise. (The book comes out in June–if you want to be notified when it’s available on Amazon.com, send me an email.)

In early 2002 when I first was investigating Maui Wowi, Michael asked me whether I was running toward something by starting a business or whether I was running away from something. I thought that was a great question. Turns out I was running away from something, namely my being burned out on corporate life and my lack of will to keep at it. I didn’t care what I did, as long as it didn’t involve corporate structure, a boss, and airplanes. And voila, or perhaps a better word would be “Aloha!” I became part of Maui Wowi’s ‘Ohana (Hawaiian for “family”).

In our chat the other day about running away versus running toward, which, by the way, is the subject of a chapter of my book, Michael said, “Well, maybe you didn’t make the right decision, but you made the decision right.” Man, every seven years or so this guy gives me a line I can use for the next seven years! I’ve been thinking about that line since we talked on Friday. It really fits what happened to me in my franchise. I was running away from what wasn’t working for me. I landed in something that was completely different from what I thought it would be: I thought I’d be opening a retail store every six months or so until I had an empire of 10 or more stores generating sales of $500,000+ each. And I’d be directing my minions to do the work while I counted the cash.

Well, it turned out a little differently. There were no good locations at reasonable rents, so I launched the business with a portable kiosk at Yankee Stadium, and then more kiosks at other stadiums and similar facilities. The work was profitable but back-breaking. Despite the heavy lifting, I did enjoy, as one former franchise colleague put it, having my “man license” and driving a trailer around with 900 pounds of stainless steel inside–at least for a while. I realized I could not sustain this unexpected business model for very long (though some in our system do it and love it). I had to, as Michael said, make the decision right. Walking away–as some other franchisees have done–wasn’t an option for me. And do what? Go back to corporate America? Not a chance.

So I changed my business model from retail events to catered events with smaller, portable equipment, and focused on corporations, private parties and colleges. I am solidly on my way to a multimillion-dollar business and have no intention of stopping, and no desire to. I am having too much fun and too much success.  All because I didn’t make the right decision, but I made the decision right. If you know who said that first, let me know.

Coaches have coaches, too, of course. Mine is Leah Grant. She wrote this piece about how to craft a great elevator speech. I can’t improve on it, so here it is, published with her permission:

Your elevator speech is a verbal business card or billboard. In order for it to be effective it must be compelling. You want it to draw in the prospect yet leave them wanting to know more.

It is one sentence, two at the most, and serves as your benefit statement.  Your elevator speech needs to be just what its name implies, short enough to share on an elevator ride.

It should provide clear, jargon-free information about who you are, what you do and what’s in it for the prospect.

Craft your elevator speech when you have a crystal clear picture of your business. Simply stating your industry and title is too vague. You must be able to articulate the main problem your specific type or business focus solves for your target market.

You must also know your target market and what motivates them.  For example, when I was networking with financial planners, I tested a few elevator speeches to see which got the best response.

The one that worked well was “I partner with new financial planners who want to blow their numbers out of the water.”

The one that flopped was “I coach financial planners so that they can effectively market themselves.”

The latter describes what I actually do with them, but that language is not as appealing to them as the other statement because they tend to be competitive and driven to win.

What to Include in Your Elevator Speech

1)  Your name

Oddly, some people forget to put their name in their elevator speech.  You are promoting yourself, so be sure to state your full name clearly.

2)  Who you work with or who your product is for

Identify your target market.  This won’t eliminate buyers, it will make it easier for people to refer you business.

3)  What’s the benefit they get if they buy

You can state either the end result or share the problem that you solve.

4)  What is your product or service

Most elevator speeches work well without mentioning the actual product or service, because most of the time people buy the benefit.  Sometimes it is necessary to include.  If it is, do so without going into detail or listing the features of what you offer.  Come up with a succinct and attractive way to state what you sell.

What Not to Include in Your Elevator Speech

1) Your title

In most cases your title doesn’t tell people much about what you do.  It wastes words and time.  If they are interested, they can see it on your business card.

2) Pricing

Never include what you charge in your elevator speech, but do be prepared to discuss your fees if asked.

3) Features

Features are not benefits, but many professionals confuse the two.  Features are things the product or service has, such as a new car’s features might include anti-lock brakes, a lighted mirror on the sun visor and six cup holders.  The features may provide benefits, such as safety or comfort.  In your elevator speech, focus on the benefits.

4) Packaging

Unless your packaging is what makes your product or service unique, such as video conferencing, then leave it out of your short description.

Formula for Composing a Great Elevator Speech

Your Name + Target Market + Benefits

or

Your Name + Product/Service + Target Market + Benefits

Example 1:

I’m Tracy Manning. I facilitate virtual teams to maximize their productivity.

Example 2:

I’m Jonathan Smith. I guide at-risk teens to develop their sense of self-esteem and stay in school.

Example 3:

I’m Jane Doe.  As a room designer, I partner with new homeowners who want to their new home to feel like a summer cottage in England.

Example 4:

I’m Jason Horn.  Carpet Layers International specializes in quality installations for property owners with round staircases.

Take note of the strong verb used in each of the examples.  You will want to choose an equally impactful verb for your elevator speech.

I suggest using the formula to create a basic elevator speech and then spice up the language.

Once you’ve crafted a couple of elevator speeches you’ll want to test them out to see which gets the best response.

After you’ve identified the winner, the key to using it effectively is to practice, practice, practice. Say it out loud in front of a mirror until it flows comfortably off your tongue.

Your elevator speech describes who you are and what you do professionally. Take pride in it.

© 2009 Leah Grant Enterprises LLC
New Business Mentor Leah Grant publishes Startup Success, a weekly ezine. If you’re thinking about starting a new business or are in the early phases of entrepreneurship, get your FREE New Business Startup Kit including the Secrets of Successful Business Owners audio at www.leahgrant.com

In Summer 2009, I will publish Franchise-Freedom or Fantasy?  How to Know if a Franchise is Right for You After Your Corporate Career. The book is based on my seven years of experience as as a successful franchise owner and coach for entrepreneurs.

In my coaching practice, I work with executives who are considering entrepreneurship–which often includes an evaluation of buying a franchise. In the book, I lay out for the experienced business person a process for understanding whether franchising is a potentially viable alternative and, if it is, how to move forward. The book includes critical information including:

• Knowing whether you are pursuing a franchise for the right reasons
• The critical skills you need to be successful in franchising
• What reserves you need before you start
• How to negotiate with franchisors
• How to evaluate non-franchise alternatives

If you’d like to be notified when the book becomes available, please email me with BOOK in the subject line, and I will let you know.

Last week I spoke at a conference called Re-Branding You, sponsored by NYU’s School of Continuing and Professional Studies and organized beautifully by P&V Enterprises and Events by Ny. The conference was aimed at people who are looking to change careers or positions as the economy shifts. I met a lot of highly motivated, forward-looking people who aren’t sitting still while change and opportunity present themselves. One of the innovative aspects of the conference was a “speed-coaching” area. Attendees were given the opportunity to meet for 15 minutes with a number of professional coaches. I met with about a dozen people throughout the day between conference sessions.

One meeting, which was fairly typical, was with a young woman who had been recently laid off from a position at a New York bank. She didn’t have a clear idea of what to do next. Turns out she graduated from a major New York music school 10 years ago as an accomplished French horn player. She also teaches music to several students on the side. A little further into our conversation I learned that she loves to teach music and is passionate about it. Ahe really started smiling and her eyes and facial expression became much more animated the more we talked about music and the less we talked about banking.  And….get this….she successfully teaches dyslexic children how to read and play music. Wow!  I asked her whether she would love doing more of that and getting paid really well for it, versus working in a bank. She practically jumped out of her chair! Slowly, she described a plan to position herself as a private music instructor for special-needs (not just dyslexic) children, and that she would target the Manhattan private school market as a start. One person, one potential entrepreneur, re-branded.