Thursday, March 5, 2009

Interview with an Entrepreneur: John Avellanet


I recently had the opportunity to interview a good friend and entrepreneur, John Avellanet of Cerulean Associates. Cerulean is a specialty consulting shop focused on FDA quality systems and regulatory compliance.

Brad: John, now that you have been in business for a few years – what has been the most unexpected aspect of running your own business?[JA] The marketing never stops – clients do.

2. Did you or have you taken advantage of business services offered by community or governmental groups: whether SBA, local business incubator, chamber of commerce, university? If not, why not? If you did – was it helpful?[JA] The SBA I did not approach because I didn’t want a loan; I did plow through their very, very helpful website and resources. The local business incubator recommended that I contact them once I had at least 3 employees (or temps) working for me. The chamber of commerce I tried to use, but this is really just a networking group and lobby group for the local community; if you’re not selling to local businesses, carefully evaluate any impetus to join. That said, the chamber does have the SCORE folks (retired executives who donate their time) and depending on your type of business SCORE may be very helpful so don’t overlook it. As for local colleges, I ended up guest lecturing at the local business university on entrepreneurship.

3. Did you put together a business plan when you started? [JA] Yes and like everyone says, it’s a good exercise, forcing you to conduct market analyses, etc., but realistically, unless you plan on keeping it a living document, revising, etc., every six months to a year, it sits in a drawer collecting dust. I would suggest you put together one, but then do a simple 3-4 page annual summary every year, and make those addendums, to help you craft your business. You’ll be surprised at how much your target changes after 2-3 years from what you first conceived.

4. Did your expectations regarding competition and market size when you started your business match up to what you’ve experienced? [JA] Yes and no. There is definitely more competition out there than I had originally surveyed – things crop up over time, so in hindsight, that’s something anyone looking to start out should expect. Depending on the business model – and the economy – competition will go up and down. Despite the tough economy right now, I expect the market size to continue to expand – not because of some imagined miracle cloud of new customers that will “poof” appear, but because we continue to be globally connected and this increases the number of folks looking for my services. That said, given the economy, several of my competitors (particularly the larger ones) have already gone out of business or filed for bankruptcy (see the part above, when a couple of years ago I didn’t want to start by taking out a loan), so that’s created more elbow room for me and continues to increase the number of folks wanting to work with me.

5. Have you considered co-working or professional office space to house your business? [JA] Yes, but until I need to (as in, have to hire at least a couple of full-time folks), I don’t anticipate it. Currently, I operate out of a home office and love it (especially since I spent 8 years commuting 1 hour 15 minutes each way to and from work – now my commute is approximately 7 seconds).

6. How do you locate and develop your pipeline of new clients? [JA] This is the million dollar question. I’ve tried cold-calling; it really doesn’t work for the small business person – it’s just a numbers game and to get a greater chance of success requires more calls, so when do you actually have time to work? Plus, frankly, I’m not a big fan of telemarketing. I’ve had the best luck through those things I do best: writing, speaking, and giving great service (so the latter translates into referrals). Every business is different, though, and entrepreneurs and owners should focus on what they do best and like to do in order to generate clients. Several colleagues of mine really dislike writing and speaking, but love networking – that’s how they get almost all their business.

7. What’s been the toll or effect on your family life with you running your own business? [JA] Well, this is another reason why I like working from home. I read somewhere that the average entrepreneur works at least – that’s “at least” – 60 hours a week. I don’t doubt it; I suspect that number is probably low. So, if I were out of the house 60-80 hours a week, I’d never see my family. Now, I can take a break here and there, go meet the kids at the bus, and so on. And I’ve got a lot more energy without the commute….

8. Do you have a personal network or peer group of individuals you meet with regularly to discuss business ownership, what’s happening and generally to bounce ideas? [JA] Yes – both virtually and in person. I like to talk over ideas with friends who run their own businesses (all different from mine) locally; I find they are a source of interesting ideas and challenges – after all, if they do a promotion that succeeds, how can I adopt that and make it succeed for me…those are the types of discussions I love. From a virtual aspect, I use the phone and email a lot to keep in touch with old colleagues whom I trust implicitly to give me perspective and wake me up from getting too carried away with some idea or other. I think advice from both those sets of folks has helped me survive so far.

Hey, wait a minute - thatlast question was supposed to be answered "Oh yes, Brad Rickelman is the greatest!" [JA] You said I was supposed to answer truthfully - and I did intimate that I talk with 'old collegues'.

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