Podcast: Play in new window | Download | Embed
Subscribe: Apple Podcasts | Android | RSS | More
Coming to you from the business district of the Haight-Ashbury.
We interview Tim Berry, the Obi-Wan Kenobi of business planning. He’s a Baby Boomer, ex-hippie, Stanford MBA, entrepreneur.
Tim told us he failed as a hippie. He left home at 18 to live in Haight-Ashbury but it didn’t last long. He didn’t want to “take the damn LSD.” After a few weeks he called home telling his parents he wanted to come back. They said, “Okay, but you have to go to Notre Dame.”
That’s where he met his wife Evangelina who he’s been married to for 45 years. He majored in literature and enrolled in a PhD program. After talking to a shoe salesman who had gone through the program, he realized it was a bad idea and switched to journalism.
Soon after graduation, he became a journalist and worked for 10 years as night editor for Northern Latin America of United Press International in Mexico City. His wife helped him learn Spanish quickly by not speaking a word of English to him for 2 years.
Eventually, he figured out that journalism wasn’t going to help him “change the world.” It was filling the space between ads. At that point he had 3 small kids and realized that journalism wasn’t ever going to pay well. He took up business writing, which doubled his income from terrible to a little bit less than terrible. While he was there he took grad classes in business and found it to be more interesting than journalism. When he left Mexico and returned to the U.S. he had savings in hand and a letter of acceptance from Stanford business school, where he ended up getting his MBA.
His wife was supportive during all these transitions, which made it easy for him to become an entrepreneur. Two years after getting his MBA, he worked as a VP at a marketing research firm. He was doing almost exactly what he did as a business journalist but charged 5 times more.
Businesses in Silicon Valley were in start-up mode and he became excited about developing business plans. His background in journalism, plus his love for numbers gave him an edge. By this time he had 4 kids and left his job to start his own business with his wife’s continued support.
Entrepreneurial tip:
Make sure not to put yourself in the position of losing your relationship.
Success in Business
Tim built Palo Alto Software, a company with 65 employees and more than 10 million in sales.
Watch Tim’s Video – Startups and Entrepreneurship: Beyond the Clichés – click here.
Debunking business myths
People listen to experts, read all the blog posts and then parrot information to others.
Myth #1 Do what you love – Tim says he loves to play the guitar but no one is going to pay him to play it. You have to do what other people love. It will also be hard to build a company around it. What’s less hard is if you’re doing something that relates to what you love, but is also offering value to other people.
Myth #2 – All it takes is persistence to succeed – It’s not true. You have to give value. People are told “keep on going and you will succeed,” and they end up losing their homes and relationships.
Palo Alto Software had a product that got out into the market and it grew. The company brought in venture capital and 3 years later, during the .com crash he bought it back. Tim was able to create a living doing what he “liked” to do, surrounded by people he had chosen himself who believed in the same thing.
He’s still involved with the company and is making a good living even though his second daughter is now running it. Four of his five kids have worked in the company and all are successful in business. They learned by doing.
His son, Paul Berry is CEO of Rebel Mouse, a successful online company in New York and has 110 employees. His youngest daughter is the head of product development for Rebel Mouse. Paul was CTO of Huffington Post from a few months before it started until it was bought by AOL.
Since his daughter took over, Tim’s written 3 books, 5,000 blog posts, is a paid speaker and has a social media consulting company with another daughter. He hates golf and didn’t want to go fishing so, instead, he keeps busy cherry picking what he wants to do.
Business plans have gotten a bad name lately but Tim believes they work if they’re done right. That’s why his book is called:
It’s not the pompous, formal, boring text from a scholar. Lean Business Planning contains bullet points on what you need to be reminded of regarding tactics and major milestones to make your business succeed. It also includes a sales forecast, spending budget, and cash plan so you can track and run your business better.
For those starting a new business or “reinvention”
A business plan is a simple way to go from all that vague uncertainty to making a list of what to do next and what’s important.
Planning should be fun. It is anticipation combined with organization combined with logistics all of which makes it easier and better.
One mistake people make when they make a business plan is thinking the world stops while they do it. A business plan should be reviewed 5 minutes at a time constantly. Once a month, you set aside an hour or two to review where you are, the progress you’ve made, and budget vs actual. The biggest mistake is thinking its hard or a big deal.
The second biggest mistake is underestimating expenses. Some people think a plan needs to show that you’ll make a big profit. The truth is, you won’t at first. You can’t grow a business with profits so why project that you are? Instead, assume you will make 2-3% profit and most of the spending will be in marketing.
You’re far more likely to be successful as the highest priced version of what you do rather than as the lowest version. Businesses get killed when they think they have to be the cheapest.
New startups don’t need angel investors, they need customers and cash flow. You don’t get investment until you have most of the work done.
Find Tim at www.leanplan.com. His book is available for free online if you don’t want to buy the book. There’s also an online course on the site. Find out more about Tim at www.timberry.com.
Visit 2 Boomer Broads Author’s corner to view the books of all the author’s we’ve interviewed. If you purchase from our link, it will help support our show.
