The Pit - IMI Trust

A trip to the dentist was in order. It has been some time and a cracked tooth made up my mind to visit. I was not that concerned as I already had root canal work done on this culprit.

This was the first time I had been to this dentist. It met the mandatory criteria - looked clean, close to where I live, attractive looking people inside and I had heard some good things from friends of mine.

The girl at reception were very welcoming and asked me to fill out a questionnaire. One of the questions was interesting. “Do you feel nervous when you go to the dentist?” Not being afraid to admit it… I ticked ‘YES’. Not long after my name is called. As we go up the stairs, the dentist gave my form a quick read.

Within seconds of sitting down, he starts stabbing inside my mouth *OWWWWW!!* was my first thought. ‘Thanks for helping me to settle my nerves!’ was my second thought.

After my yelp he decides that it is not able to be fixed and he needs to take out half the tooth to have a look. But just to make sure, he does an x-ray. Red flags and alarm bells. A course of action decided before full information is gathered. Is that usual?

So he then explains that what he can do is…

1) Take out half the tooth and see if it can be fixed. He thinks it is ‘unlikely’ and a ’small possibility’ that it can be fixed. If it can, he will fix it and set a crown on it.

2) “If it cant be fixed, we take the tooth out, shave down the teeth next to them, place caps on them and then put a bridge in.

and the last option, which he didn’t favour at all…

3) Extract the tooth and leave a gap.

I have only been sat in the room 5 minutes. By this stage, I am thinking “what the %$&*?”

I am feeling pain, visualising gaps in my mouth and thinking about eating without a tooth, or the damage it will do to the teeth on either side. Also I am thinking, neither of the ‘preferred’ options sound cheap.

Nerves have turned into flat out fear.

Then he says, ok… now I am going to take out this side of the tooth and see if it can be fixed. I am thinking by this stage I am being rail roaded down a path in which I have minimal information of cost, procedure or other options.

I stop the dentist and ask him can he outline my options and the cost of them. I explain I have meetings today and I need my mouth for those meetings. Not those kind of meetings. He says it’s OK it will only take 30 minutes max.

“I am happy to book another appointment”, I tell him.

The dentist kindly starts outlining the options he was trying to take me down today with no information, very minimal explanation and providing me with the feeling he is selling me and not serving me. In other words, I was getting the feeling it was ‘not’ the best path for ‘me’, but the best path for ‘him’.

The two options were $2,000 and $5,000 for a tooth I had already had root canal on. No information, no explanation, no rapport established and no time to think about different options and a form clearly stating that I am nervous. This hard-selling dentist has turned me right off going to this practice. It certainly didn’t provide any assistance in calming my nerves next time I see a new dentist.

In fact, I will be flying to Sydney next week on business and have booked to see a dentist I do trust.

Maybe dentists are being trained on sales these days. If they are, they should definitely invest time in understanding trust, rapport and ability to explain information in terms normal people can understand. Also, the should become aware, that if someone clearly states they are nervous, railroading them into an expensive path is not the best course of action.

From a business perspective, it highlighted how important trust is, and giving people the time to think. That trust can easily be developed through balanced information, and an understanding of someones personality. If you need to hard sell and railroad people into your product, then get a new product.

Also in listening to my own thoughts, I started to notice how I began generalising an industry because of one persons actions, and by the end of the day 5 other people knew about my experience.

And now I write about this experience in this post which will be read by over 1,000 people. This the impact we can have each day in our business. Positive or negative.

The new Apple iPhone flew off the shelves in the US after many months of hype.  Incredibly, consumers still parted with $600 (3 times now that on eBay) for a phone that is limited in functionality.  Even when you look at the basics, you can see where the issues are for the average phone user.

• Basic Camera 
• No Video Recording
• No MMS
• No Custom Ringtones
• No Speed Dial
• No Voice Dial
• No Flash Support

As is always the case with technology, Version 2 should be a lot better.  We hope

There is a famous saying in hospitality:

“The answer is yes, now what’s the question?”

The sentiment behind this is that the customer is always right.  The customer has a need that requires fulfilling.  There are many companies that follow this customer-orientated ethic.  Starbucks is one, as no drink is ever not made no matter how crazy the concoction may be.  If that’s the way they want it, then that’s the way they get it.

In the corporate world, and in particular financial services, there are several companies that try and maintain a business model that revolves around this attitide. However, at which point does corporate responsibility take over?  In many instances in business the customer is not the best person to ask for direction or opinion. In fact, they are absolutely the worst person to ask.

Customers should have an end goal and how that end goal is reached should be down to the service provider on how it can be best achieved.  This is the basis of good business.  It’s a Win/Win situation.

There are some business relationships that, from the beginning, that it is clear that it is going to be a Lose/Lose situation.  Why do we enter these?

Have you knowingly entered any of these before and has the outcome been different to how you expected?

This week the Australian Financial Review reported that 80% of the 96 companies which listed on the ASX this year, had their share price go up in the first day of trading.

Empowernet International (ENI.AX) is not one of those companies. In fact, on their first day of listing, their share price went down nearly 50%. Better yet, after a few days, Empowernet went from its list price of 0.55c to around 0.07c. For IPO investors, this signifies an 80% loss on their holdings to date.

If you do not know who Empowernet International is then you’ll see their main revenue stream derives from onselling Anthony Robbins personal development products and merchandise. Key person/company dependency. Check!

Empowernet International doesn’t have a written contract in place guaranteeing exclusivity either. No owned IP. Check!

Results can also be uncertain if their are changes to the marketplace - Few corporate processes or systems in place. Check!

When a company lists it needs to be able to drive by itself with the management team being custodians of the vehicle. If these continuity issues aren’t resolved then the market loses confidence and share prices fall. Incredibly, the one of the directors of Empowernet had the exact same issues when listing Sales Pursuit.
Our advice to Empowernet to get the share price up is a three step process:

1. Change the company name to Empowernet Resources International.
2. Announce that the company is now actively exploring Western Australia and Queensland for Uranium, Copper, Nickel and Gold.
3. Announce that the company was in negotiation to supply China and India with the new found resources.

If they did this, the share price will be hitting $10 or $20 in no time. Virtual miners are big on the ASX at the moment.

Time to get things off our chest…

It is our experience to steer clear of search engine marketers who boast badges with the Google AdWords Professional qualification.

Let’s be clear.  We, at IMI Trust, love Google and so should you.  It is the reigning champion of search and rightly so…however…

The Google AdWords Professional qualification can be earned if you, as a marketer spend $1,000 per month with Google.  Some people spend much more than this in a day.  Not because they are clever, or skilled in search engine marketing, but because they see the value in this type of advertising.  As they have spent that dollar value they qualify as being a Google AdWords Professional.  Can you begin to see where the issue lies?

There is no qualification in place and people can claim to be an endorsed professional.  This fails in a number of ways.

1. Punters that need help in Search Engine Advertising are looking for reassurance and expertise.  The Google AdWords Professional provides neither, though the name alludes to the fact it does.
2. Professionals who are great at Search Engine Marketing have more trouble finding work because they are competing with thousands of clowns who don’t know their KPI’s from their CPC’s.
3. Google is diluting its brand by offering this nonsense award.  Google do have other qualifications that are far more meaningful but as this is the easiest to achieve because you just have to spend dollars.

We are not against people becoming search engine advertising experts but if they claim to be experts there has to be more to it than that.  Which reminds me…I’ve got an email to answer about claiming my Fijian Medical Degree.

That would be a common sense play.  Who knows what will happen next?  Apart from a glut of Hedge Fund managers jumping off building tops because they didn’t know when to hold ‘em or when to fold ‘em.

Anyone have a spare $11bn?  Check down the back of the sofa.

Capital Raising, Venture Capital, Business Angels and Private Equity have become flavour of the month in Australia.

The reality is, for businesses looking to raise capital, it can become a nightmare for the unsuspecting owner. You always read about the successful ventures but rarely do you hear of about the challenges associated with raising capital for your business. For other business, who utilise business factoring services, it is their opportunity to utilise an alternative solution. 

When it comes to capital raising, most business owners believe they have 3 places to go: Banks, Angels and Venture Capitalists. Few people realise there is a 4th way to go if you want to raise between $250,000 and $5m (without a prospectus).

Below is a snapshot of some of the issues related to each.

Venture Capitalists
There is a reason they are called Vulture Capitalists. They generally look for small to mid size companies and traditionally Venture Capitalists will value your company on its current value (prior to growth following funding), and then look to take a stake based on that value. Some Venture Capitalists, will also look to play a role in the management of the business. It is a coin toss whether this becomes an asset or a liability.

This path is fraught with problems especially if you are looking to retain control of your business. With one business we worked with after funds were raised through a Venture Capitalist, personal attitudes and business differences surfaced and the owner was forced to leave the very organisation they started.

Business Angels
Business Angels could be ideal for your business if the Angel brings a wealth of experience, contact or resources to the table but again the problems you face with Venture Capitalist’s, you are likely to face with Business Angels. You lose control and possibly a lot more.

Banks -
Although the most common option for people, you should only really go to a bank if you a desperate. This is why…

1. Do you enjoy putting your own personal assets at risk?
2. Do you enjoy paying interest for the life of the loan?

Of course not. When raising capital the questions you want to be asking are…

1. What percentage of the company am I willing to offer? How are the shares going to be split up between the current owners and stakeholders.
2. Is your business structure investor friendly, as well as business owner friendly
3. If you are utilising the banks, are you willing to put your personal assets on the line
4. Do you want to retain control of your business, or are you happy for a 3rd party to have an influence?
5. Have you put in place a strong management team?
6. How unique is your offering, and what is your realistic potential for growth?

All of these questions are important, and you should definitely know the answers before you approach any organisation to assist you in funding the growth of your business.

These are the questions you need to answer when looking at the 4th way for you to Raise Capital for your business

This path offers some unique benefits…

1. The capital raised is interest free
2. Doesn’t require you to put your home up as security
3. Allows you to maintain the majority shareholding in your business… allowing you to retain control of the future direction of your company.
4. Allows you to crystalise the value of your business, which is recognised by the markets and considered as an asset on your balance sheet
5. Provides an investor-friendly environment allowing your investors the opportunity to sell their holding if they desire
6. Ensures that you are compliant with ASIC’s rules and regulations. Most people dont realise the legal mine field and potential issues if you try and do this yourself… and get it wrong. Let me provide some insight… a $20,000 fine, 5 years jail, the company wound up… and then it starts to get ugly from there.

Our focus is to help entrepreneurs realise the aspirations they have for their business!
What this means for you is that IMI Trust is able to facilitate debt and equity funding for your business growth, expansion and acquisitions.

To explore the commercial potential of raising capital for your business click here.

NO NO NO NO!  It is incredibly frustrating to see how people compete on price.

The number one reason companies compete on price is because they are poor at marketing.  It is the worst way to try and grow a business, as your marketing plan seeks to eliminate your own profits and the more aggressive you market the slimmer your margins are.

If your marketing appeals to your target market correctly then it is unneccesary to compete on price.  A well-known Australian Bank split-test a marketing campaign recently.  To a sample of 10,000 people they sent two separate credit card offers.

1. One offer with an interest rate of 12.5%
2. One offer with an interest rate of 16.5%

Clearly, credit cards that have the lower interest rate should be more popular.  Which offer do you think would be the most successful? Remember this was the same company, going to the same client client base.

To their sample, the interest rate of 16.5% was easily the most successful.  So what was the difference?

On the 16.5% offer there was a photograph of an attractive, healthy, female on the letter. Marketing and appealing to your target market wins over low prices.  In this case, just one photo encouraged credit card prospects to take an offer 33% more expensive.

There is so many frontlines in business in which the war can be won.  If you are trying to win it on price… ask yourself if this is really your best strategy

FON.  If you haven’t heard of them yet then you soon will.  They are backed by some of the most powerful organisations on the internet, Skype and Google as well as the venture capital companies behind these giants, Sequoia Capital and Index Ventures are all investor partners in FON.  So why has FON done so well to capture the attention of these giants?

FON is the world’s largest WiFi community. Started in Spain by Martin Varsavsky, FON is built on the idea of creating a community of people who get more out of their internet connection through sharing. Every router purchased by a user enables that user to become a mini-ISP.  The beauty is they can choose to charge for the service or give it away for free if they so wish. Any amount they charge is split down the middle with FON.

Clearly, this is the best home-based business idea in a long time.  Have an internet connection and resell the bandwidth to people in your local area.  Be your own ISP and profit.  Or be chartiable and give it away. 

We love the idea here at IMI Trust but we are not alone.  There are over 300,000 ‘hotspots’, or router portals worldwide and FON want to grow that to 1m by 2010.

When FON finally hits Australia, it will cause a massive shake up in a stagnant and relatively service-free industry.  Large Internet Service Providers are getting fat on the easy profits made by broadband users.  Wireless service is poor in Australia and worse still, fees for usage are ridiculous compared our international counterparts.

So FON sound ambitious.  You are not wrong.  To kickstart their success in the US, they have have just offered 10,000 people who live near Starbucks, or any cafe with any existing WiFi hotspot, the opportunity to receive their FON WiFi router for free. A bold move considering Starbucks has its own service it provides, but when you have Google, Skype and Sequoia Capital backing you, bold moves come with the territory.  Since there are over 13,000 Starbucks stores worldwide, this initiative is only the beginning of a large scale, long term plan.

Forbes Magazine have listed them as one of THE companies to watch this year. Not bad for a company which only had its first birthday this February.

The question on Australian lips is surely when is FON coming to Australia? We need your service sooner rather than later. 

Also, on a more self-interested note, when is the IPO? And where can we sign up?

When companies choose to have nauseatingly redundant Flash intro pages is having a Skip Intro button signifyng that the content on the page is worthless and not worth seeing?  

Well…Yes!  

Does a kettle have more value because it displays a pretty, neon light show before it starts boiling water? Well…No!  

Redundant design is bad.  There is a lot more to say about this subject so….*****permission to skip blog post enabled*****