Expert Views on Business Plans & Which Advice I Will Follow

Expert Views on Business Plans & Which Advice I Will Follow

My last blog talked about the importance of a business plan from two experts in the field.  Each one of them had different views on how to put a business plan together. McShea believes an entrepreneur needs to have an intense business plan in order to succeed. Hsu believes that an entrepreneur needs to have a simple plan, and not to spend too much time on writing a plan.   Hsu believes one should put that time and effort into your business, and your customer base.  Hsu believes that you should a have plan, but not the old thinking of a 100 page business plan. 

            I agree with Hsu, and I am taking the advice of that he is giving. I am putting a plan into place because I need to see where my company is going.  I have decided to invest a lot of my time into my customer, and making sure I am bringing them the customer service needed to survive, and the correct product to the market they will buy.  I want to make sure my investors will see the return on the investment with my company.  Also, I would like my potential investors to see that I know my market, understand the importance of marketing, and that I will spend marketing dollars smart, and not frivolous.  In my business plan I will make sure that my investors understand the marketing section, and finance section of my business plan.  I think if an investor understands my go to market plan, and how money I expect to make selling our product they will think of my company as a great investment.

            I have learned a lot on how to put a business plan together, and I am currently using this important information in finalizing my business plan. I think one important aspect I will make sure my business plan talks about the business, and how it will make money.  I will not waste valuable time on the fluff of the business plan, but the meat.

Is a Business Plan Important

I have always been taught that you have to have a business plan in order to make it as an entrepreneur.  I have been taught if you do not have a plan you do not have way.  I still believe in order to have a successful business you need you have some type of plan, but it does not have to be the old 40-150 pages that use to be the standard for a business plan. There is an article that has two experts debate the importance of having a business plan and why it is not important to have a business plan. David F. McPhee, partner at law firm Perkins Coie says absolutely, and Will Hsu co-founder of MuckerLab says absolutely not.

The two experts were asked a few questions that pertain to why you should or shouldn’t you have a business plan.  Both experts have valid points, and actually both experts are somewhat saying the same thing but in different ways.  McShea says having a business plan can help a person realize if their idea is really worth starting because a lot of business ideas sound good until a person actually writes it down. McShea believes that a person can save a lot of money by writing this down, and save on payroll or investments.  Hsu believes the best way to get started is take your product to the market, and let your customer base and target market let you know where you need to go.  Hsu believes that an entrepreneur should not waste valuable time on putting a business plan together, but take that time talking to customers and finding how to improve their product and pricing for the market.  I believe both experts have a valid point because some people can get tied up on the small details in a business plan, and this can keep a person off track on the ultimate goal, which is to start up a successful business. 

McShea believes that having a business plan will attract investors, while Hsu feels having a simple plan, but being able to show your bottom line will be more attractive to investors.  Hsu feels that an investor wants a plan that will be 10-15 pages, and not the usually 40-page business plan.  Hsu feels that investors do not want to get caught up in the fluff of a long business plan.  I agree with both McShea and Hsu when it comes to a business plan.  I believe in K.I.S.S, keep it simple stupid.  I agree with McShea that every new business needs a business plan, and I agree with Hsu that it needs to be simple, and not to spend so much time on a plan that you do not spend the needed time with your customer. 

Importance of SEO

-->

The Importance of SEO As A Musician

Many musicians may not understand the importance of search engine optimization or for short SEO.  I have dealt with a lot musicians that feel once they have a website up and going they are going to start to see their fan base skyrocket.  But in reality this was just the first step.  I ran across an article that gives musicians nine steps to help on how to utilize search optimization.  One of the steps is the most common, and probably the most popular step, and this is the use of social networking.

Sites such as Facebook, Twitter, YouTube and MySpace are great support for musicians, and these sites are a great way for musicians not only to promote their music, but to also network with other musicians, and people in the music industry.  Another important step is the use of keywordsfor their website.  An important fact that musicians need to know is that they really need only 5-10 keywords, and not much more.  I know a lot of artist wants to use as many keywords as possible, and they think this will help get them more visibility, but in fact this can end up hurting their exposure.   Along, with using keywords, artist should make sure they use real words.

Some of you may be thinking, what are real words?  Well, real words means when an artist post content to their website such as music videos to use real words.  Google can only read real words, and not videos, so this means you have to insert some form of content with your music videos.  One more important step to help get more visibility to your website is the use of analytics andstatistics.  This will allow you to be able to track how much traffic you have visiting your site on a daily basis. There are plenty of free tools that will allow you to be able to keep track of this information.  Also, it is very important to know these numbers, because this can help in securing a deal or even better you can secure sponsorship because you have so much traffic going to your website.  

Kellie B.

Importance of Publishing

Publishing

            Publishing is a very important in the music industry, but it seems this in one of the most looked over aspects of artist in their career.  Publishing is one of the main reasons artist back in the 50’s, 60’s and 70’s ended up losing everything they worked hard for.  Or publishing is the reason that groups like the Temptations had to always keep touring because they did not write or publish any of the music they performed.   In today’s music industry there is not a reason to go through what artists of those time period went through because the Internet allows one to do their research.  But believe it or not some artist are so excited to get a deal that they do not pay attention to what type of contract they are getting into.  People in the music industry understand that they do not make money off of an artist selling music in today’s music industry.  But record labels are still well aware that publishing still makes money like it did back in the day.   

            So a few things an artist should do while making their music.  The first and foremost important step is to copyright all of their music.  This is very important to protect themselves from having their hard work stolen from them.  But I find the problem with independent artist is they do not want to do the research to this and to make sure they are doing this correctly.  A lot of independent artist are just concerned with performing and putting their music out there, and not realizing that they can be setting themselves up for failure.   My advice to every independent artist make sure you copyright your material, and look into get your music published.  As an artist you can make a lot of money by publishing your work and selling it to well known artist in the industry.  And all you did was a write a song, something you do everyday.

Kellie B.

Do Your Research on Digital Distribution

Digital Distribution

            In today’s music industry everyone keeps saying it is easy to distribute music compared to the 90’s.  I would agree as well because you have iTunes, tunecore, CD Baby and even website such as reverbnation that will digitally distribute your music on 40 different sites.   Even though it might be easy to put your music online to be sold, does an artist still have to spend marketing money to make people go to these sites, and buy their music?  The answer the question is yes, an artist has to learn how to market promote their music once they have it available online to sell.

            Just like any other business marketing is one of the highest budgets a company has.  Marketing is the way to bring your music to the world.  So what are ways an artist can promote their online distribution?  A good way to is have their own website, that they have links to iTunes, and other online distributors.  Another major way is utilize social networking sites such as twitter and Facebook.  Those two sites and can be the major source of marketing, and the great part about using these sites is that both of social networking sites are free to use.  Now there are also sites online that an artist can pay for that will teach an artist on how to properly market their music online, and what are some the proper ways to go about marketing their music.  I am a fan of a person investing in themselves and that is the reason I am furthering my education to get the knowledge needed to pursue a career in the entertainment industry.   I think this is sometimes where independent artist makes mistakes on their career.  They are so eager to make a new track and put it online to sell, and they now feel they have made.  Then four months down the road they have only sold ten songs. They do not do the research they need or take the time and money to invest in their marketing to put a single or album out to the world, and this is what hurts them in the long run.  

Kellie B.

Entertainment Lawyer Podcast... Priceless free advice!

Entertainment Law Podcast 360 Deal

            In this podcast from entertainment lawyers they are discussing the 360 deals that are becoming more popular in the music industry.  Record labels are doing these deals because of the decline in record sales, and they are finding different ways to collect money from the artist.  360 deals allows the record label to get paid off of sponsorship, endorsements, live touring, websites, and much more.  These deals can encompass all the rights or partial rights.  There are two types of 360 deals,  ownership of rights deal and income participation deal.   The ownership of rights deal, is a deal where the label owns the rights that they receive income on.  The incomeparticipation deal is when the label does not own the rights, but they just receive income on the different deals. 

            In this podcast these lawyers are giving great advice for artist to look out for while making these 360 deals with labels, but they are also giving great advice for record labels on how to put these deals to together that protects their label.   Also, the podcast discusses the importance of rights and how to protect you as an artist.  For example, they talk about the case of Drake being sued by his ex-girlfriend for using a recorded voicemail on the song Marvin’s Room.  His ex-girlfriend is suing to get co-writer credits.  She is getting credits for song credits on another song on the album, but now she feels she should be credited for this song because of the recorded voicemail that has been used.  Many of us would think that Drake is going to end up paying her a large amount of money, but the lawyers saying that she did not bring that much creative flow the track, and she should not get the credit.  But the lawyers are saying this is a case of how artist should make sure they have everything squared away in the beginning so you will not end up in case like this.  These podcast are very helpful for any up and coming artist or label executive.  They are giving great advice that can help protect you from losing a lot of money in the future. 

Kellie B. 

Intellectual Property in My Industry

-->

Intellectual Property exists in every industry throughout the world.  Intellectual Property has been put into place to protect the rights of business owners.  There some intellectual properties that people may be unaware of that may affect them in their industry.  It is very important to know these so you do not violate any of them and end up in a lawsuit or even worse arrested with charges.  In the energydrink industry there has been a recent incident in the Philippines that have a few people under arrest for violation of unfair competition. 

Energy Food & Drinks, Inc. had the exclusive rights to distribute Red Bull in the Philippines and T.C. Pharmaceutical Industries was the manufacturer of Red Bull and had its local distributor Maryland Distributors start distributing the energy drink.  TCPI has used MDI labels on the bottles of Red Bull that should have been EFDI, and this has led up to the lawsuit. 

This incident is very important for my company because we are currently working out an agreement with the owners of Cloud 9, which will give our company the exclusive rights to distribute Cloud 9 to the Las Vegas casinos.  Our ultimate goal is to have exclusive rights to distribute Cloud 9 through the United States.  We want to make sure we will not have an incidents were we can violate unfair competition.  We need to make sure Cloud 9 does not have any other distribution deals that could interfere with our exclusive rights deal.  Also, we want to make sure we have all of our paperwork in line to make sure we are protected and that another company cannot get the rights we have. 

EDFI and TCPI allegedly parted ways in 2009, but EDFI claims to have the exclusive rights since 1993, and they are currently the holders of certificate of product registration with the Food and Drug Administration.  This seems to be a case of making sure a company does its research and knows who has the rights to distribute, and again this a great case study for start up companies to make sure they do not end up in a situation like this.