A few months ago, a bright young man named Charles came to see me for advice about a business he was starting. The business, he said, was a hedge fund of cryptocurrencies like bitcoin. There were actually more than 1,500 types of cryptocurrency at the time, and the number had been growing fast, but he said he was trading only the few that were well-constructed and likely to last. “What do you think about cryptocurrency?” he asked.
I’ve heard some version of the question “What do you think of my idea for a business?” over and over for the past 50 years. First-time entrepreneurs always want to know what I think. I gave Charles the same answer I’ve given all the others: “It doesn’t matter what I think. All that matters is what you think.”
“But you must have an opinion,” Charles insisted.
“Sure, I have an opinion,” I said. “So what? I may be wrong.” And then I told him a story.
It happened in early 1969, when I was a newly minted, 26-year-old lawyer with my own practice in Brooklyn. A guy named Richard Nader came to see me. He had an idea for a rock ‘n’ roll concert business featuring performers from the 1950s. He was planning to stage the first concert at the Felt Forum in Madison Square Garden. He wanted me to put up $25,000 to help fund it. “What do you think?” he asked.
I told him I thought it was the stupidest idea I had ever heard. Understand, the country was still experiencing the British Invasion set off by the Beatles, who scored three U.S. No. 1 hits in 1969–five years after they first topped the Billboard Hot 100 with “I Want to Hold Your Hand.” Motown was also going strong. I couldn’t imagine that enough people would want to hear a bunch of washed-up rock ‘n’ roll bands to fill the Felt Forum, and I wasn’t alone. Nader had already spent four years trying to interest well-known music promoters, including Dick Clark, in his idea. After striking out with everybody else, he finally managed to borrow the money he needed from a furniture manufacturer and put on his first two Rock & Roll Revival concerts on October 18, 1969, with performances by, among others, Bill Haley and His Comets, the Coasters, the Shirelles, and the Platters.
Both shows sold out. So did almost all of the 25 oldies concerts he went on to produce at Madison Square Garden. They were so popular, in fact, that they had to be moved from the Felt Forum, which could accommodate about 4,500 people, to the main arena, which held up to 20,000.
Over the next 40 years, Nader took his oldies shows to giant venues throughout the United States and Great Britain. He even produced an oldies movie based on the concerts. A company bearing his name that he started in 1989 is still staging oldies concerts today, nine years after his death.
In the early days of his business, Nader would always send me two front-row tickets to his concerts in Madison Square Garden. It was his way of reminding me how wrong I had been about “the stupidest idea I had ever heard.” That idea wound up making him millions and millions of dollars and transforming the rock ‘n’ roll concert business.
I got the message. Since then, I have never told entrepreneurs starting businesses what I think of their ideas. On the contrary, I have urged them as forcefully as I can not to ask for or listen to other people’s opinions of their ideas. The world is full of naysayers happy to tell you how crazy you are to take a chance on a business.
I think my story convinced Charles that there was no point asking me about his idea. I told him I was very willing to offer my thoughts on how he might implement the idea and what was the likeliest way to raise the money he needed. He thanked me. I asked him to keep me posted on his progress. I’ll let you know what happens.
For decades, Formula One was synonymous with tobacco. Not only was the sport awash with money from cigarette companies, but the cars’ liveries were also reflections of their sponsors, from the red and white Marlboro McLarens to the black and gold of the John Player Special Lotus.
Tobacco brought in an average of $350 million per year for Formula One earlier this decade, and companies like British American Tobacco and Philip Morris International helped pay for the sport’s continuous cycle of development, the technological arms race that often ensured that those who spent the most won the most.
But that all ended late in 2006 after Formula One banned tobacco advertising. In 2015, the last year for which public figures are available, the sport’s 10 teams raised about $750 million from sponsorships, a $200 million drop from 2012. That loss of income hit the sport about the same time as the financial crisis, which forced the Honda, Toyota and Renault teams to shut down, although Renault eventually returned. And now Formula One is reconsidering whether to continue to accept advertising from alcohol, fast-food and snack companies.
So the sport has been looking for a new vein of money, and in the last few years teams have been working to form partnerships with the deep-pocket companies in the technology industry that would bring not only high-tech expertise, but also revenue.
Technology and Formula One are natural partners, and companies like Microsoft and Dell have long invested in the sport. Mercedes, the current champion, has a number of technical partners, including wireless technology company Qualcomm and audio experts Bose, as well as Tibco, Pure Storage, Rubrik and Epson. Microsoft Dynamics has partnered with the Renault team since 2012, and Dell returned to the sport this year with McLaren, having previously worked with the now-defunct Caterham team.
McLaren has been aggressive in obtaining partnerships over the past decade.
James Bower, McLaren’s marketing director, lived through Formula One’s sponsorship upheaval.
“Towards the end of that era—between 2001 and 2006 when the new directive kicked in—what you did see was some brands (and I would say West and Lucky Strike were probably the more innovative) pushing harder into lifestyle and pushing harder into what we recognize now as the deeper activation levels, as opposed to just slam Marlboro on the side of the car, throw a few parties, entertain some B2B trade retailers and call it a day,” Bower said, referring to business to business.
“That was making the dollar work harder, because they knew at that point the legislation was coming and they needed to just continue to deepen their relationships with their consumers,” he said. “That drove a more innovative state, and it coincided with Red Bull’s entry into Formula One, which kind of almost took over the mantle of the lifestyle.”
The loss of tobacco, the advent of lifestyle branding and active consumer engagement have also had teams like McLaren change their sponsorship focus, abandoning the old model of a big-ticket title sponsor for a series of smaller but longer-term deals. In 2018, McLaren has raised about 25 million pounds ($32.4 million) in new deals with partners including Dell, HTC, Logitech and Airgain. Exact financial details are heavily guarded, but McLaren said the money came in the form of longer contracts of five to six years.
McLaren’s roster of new partners is too recent to have made a difference to the team’s racing results, but the four-time world champion Mercedes has already proved that the right technical partnership can increase performance and income.
Because of Qualcomm, Mercedes in 2016 became the first team in the sport to wirelessly transmit data from the car to the garage, saving vital seconds as its rivals were forced to park and plug in. In a sport where the difference between success and failure is measured in tenths of a second, two seconds saved can—and did, in the case of Mercedes—help win championships.
Over the course of a Grand Prix weekend, each race car will generate more than 3 terabytes of data gathered from more than 200 sensors. Information like tire temperature and the health of mechanical components will be analysed by trackside engineers and battalions at each team’s home factory.
Teams have been seeking partnerships with data storage and data security companies. The Williams team works with Acronis, while Ferrari has worked with Kaspersky Lab since 2010.
It is not only the teams that benefit from technical partnerships. Thomas Been, chief marketing officer for software company Tibco, a partner of the Mercedes team, said the Formula One environment had a singular appeal.
“What attracted us to Formula One is the level of competition, which I think is a very good analogy to what most of our customers are seeing; the level of technology, which I guess is just a laboratory in which you create the technologies that are going to be used in the cars of tomorrow; and that everything is in real time,” Been said.
The speed of development was also what attracted Qualcomm to the sport, said Derek Aberle, a former company president.
“It’s the ability to have an environment where you can do rapid prototyping,” he said. “We can test things out. If it doesn’t work we can change them.” The engineering team, he said, is very strong and moves quickly. “It’s the environment that we have here in the racetrack—I think it does push us.
“The pace at which they move is impressive. Our guys at first were like, ‘Wow.’ They like that challenge. You get a problem, you’ve got a week to do something. They jump on it, and it’s exhilarating for them. We’ve learned a lot, and I’m hoping the Mercedes guys have learned a lot from us here. Eventually, we want to see that translate into breakthrough stuff for our business. That’s where the future is coming: cellular connectivity to the car, then the vehicle.”
Whether called sponsorships or partnerships, the deals bring money to the teams.
At McLaren, the combination of a broader business—McLaren Applied Technologies, a separate technology company linked with the race team—and a rich racing legacy has been a core element of the sales pitch.
“Obviously with Formula One it is a technical sport, so you are always going to have those authentic stories on the technical side,” said Henry Chilcott, group marketing director for the McLaren Group.
“Now it’s about us as a team here finding those more authentic stories in other areas of business, whether that is outside of technology in turn or lifestyle, conversations and elsewhere. That’s where I feel like we’re unique in the sense that we’ve got this multidimensional storytelling platform that perhaps another F1 team or another sports property won’t have.”
That storytelling is a core aspect of McLaren’s new approach, Chilcott said.
“We’ve moved away from that traditional model. In essence, the brand that you see on the car is just the bridge between one brand and McLaren. Then it’s beneath that overarching branding, it’s what we’re doing underneath the surface. That’s where we’re being unique and successful in the sense that we’re approaching things with a more ‘agency’ mindset. Discussions always lead with their objectives, rather than how much we seek to secure financially.”
Source ; livemint .
1 — Apple kicks off a product blitz.
Apple introduced several new products this week, including iOS 12, three new iPhones, revamped iPad Pros, Apple Watches with larger screens, a new entry-level laptop with a sharper screen, a pro-focused Mac mini desktop computer, and new accessories like the AirPower wireless charger. Unfortunately, Apple also said that the new tariffs recently imposed will force it to raise prices for some of its popular offerings like the Watch and AirPods. (Source: Bloomberg)
Why this is important for your business:
If your business uses Apple technology, you’ll be excited by the faster speed and battery life of the new iPhones and iPads (contractors and construction people: check out the ability to take accurate measurements from your iPhone too). What interests me the most is the added health related features in the Apple Watch, like the electrical heart rate sensor that can take an electrocardiogram. How will this affect your wellness programs and even your healthcare insurance benefits in the future? As for the higher prices, maybe all that extra productivity will make up the difference, right
2 — Verizon claims its ‘Ultra Wideband 5G’ will be better than the rest.
Verizon and the other major wireless carriers in the country are competing to see which one deploys 5G first—the service that promises to be much faster and more responsive than today’s networks. Verizon says its ‘5G Ultra Wideband’ service, which uses a super high-frequency wireless spectrum, makes it better than its competitors. The company also says three other assets set it apart as superior: millimeter wave spectrum, an end-to-end fiber network, and small cells. Verizon says its 5G broadband replacement will debut in October in Houston and Indianapolis and in California in L.A. and Sacramento. (Source: CNET)
Why this is important for your business:
As mentioned above, all of the carriers are moving to 5G. That means faster speeds for our business purposes. Is Verizon that much better? Maybe, maybe not. But let’s at least hope these faster networks come with improved security too.
3 — British Airways breach caused by credit card skimming malware, researchers say.
A threat researcher at security service RiskIQ says that credit card skimming malware installed by hackers on British Airways’ website a few months ago was what caused a data breach of more than 380,000 credit cards. The airline lost payments through its website and mobile app over a three-week period, but travel information wasn’t affected. RiskIQ suspects it might be the same group that was behind the Ticketmaster breach, in which hackers targeted a third party that loaded code on Ticketmaster’s websites and then siphoned off thousands of transactions. (Source: Tech Crunch)
Why this is important for your business:
Are you accepting credit cards on your ecommerce site? If so, then the risk of this happening to you is just as great – maybe even greater. Talk to your payments and ecommerce providers about what they’re doing to make sure that your customers’ credit information isn’t being skimmed because if there’s a problem you’re going to be held accountable.
4 — HP’s new 3D printers build items not of plastic but of steel.
This week, HP announced the Metal Jet printer, an industrial-scale 3-D printer that builds items out of steel rather than plastic and would enable the company to get into large manufacturing sectors such as automobiles and medical devices. Currently, many of the products printed by the Metal Jet may be cosmetic, such as key fobs with custom engravings. HP says it will likely be years before consumers can buy a car with 3-D-printed metal parts under the hood. (Source: WIRED)
Why this is important for your business:
3-D printing has gotten a bad rap of late because of the people who want to use these devices to print firearms. But the reality of this technology is catching up to the hype. Printing metal will enable machine shops, distributors and service facilities to significantly increase their turnaround times while decreasing their inventory levels.
5 — PayPal now gives instant access to money from online sales.
PayPal – who currently serves 19.5 million businesses announced this week the launch of a new service called Funds Now that will give select online businesses access to their completed sales within seconds by eliminating holds, delays, and reserves so they can spend their funds immediately. Funds Now has already been extended to more than one million businesses using PayPal at no extra cost. (Source: PayPal)
Disclosure: PayPal is a client of my company, The Marks Group PC, but I have received no compensation for this item.
Why this is important for your business:
For all those business owners – like myself – who scratch their heads wondering why their cash isn’t “available” for days after a payment was received, PayPal is finally resolving that issue. Could this be the beginning of the end of the annoying bank “float” that delays our access to our cash? Let’s hope so.
Source : forbes