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Business Ideas – How Craigslist was created without a Business Plan

Business Ideas – How Craigslist was created without a Business Plan

 

craig newmark

 

Today we’re going to take a closer look at how the son of a single parent and struggling bookkeeper became a successful Internet entrepreneur. Despite having started off with no business plan, this man built on of the top ten Internet sites in the world. This is the story of Craigslist founder Craig Newmark and the top 3 lessons that you can learn from his success.

 

“From the very beginning, I was involved in talking to people, listening to people. And it hasn’t stopped. The idea was that people send me information; I’d ask them about it, listen, try to do something about it – and then ask for more feedback.” – Craig Newmark

 

Craig Newmark (born December 6, 1952) is an American entrepreneur that started with an idea to inform people that turned into Craigslist, a multimillion dollar Internet business. Newmark grew up in Morristown, New Jersey. His father, a salesman who peddled everything from food to insurance, died of lung cancer shortly after Newmark’s bar mitzvah. His mother worked as a bookkeeper and struggled to make ends meet after her husband passed away. Newmark went to Morristown High School, where he became co-captain of the debate team, and also an active member of the forensics club. He also started his own club, which met regularly to play the game Go.

 

A few years after graduating college, Newmark worked for IBM in Florida then for Charles Schwab in San Francisco. Newmark then began working as an independent consultant, taking on contracts with Bank of America, Xircom, Sun Microsystems and more. After several years of observing people on the Internet and how they used online tools to help each other out, Newmark decided to start his own email service to notify people about cool arts and technology events in San Francisco.

 

When Newmark’s simple email listings reached over 240 subscribers, he could no longer carry on as he was; even his cc field would not accept anymore email addresses. Instead of shutting down, Newmark decided to move his list to a public server for all to access. He wanted to call his new website “SF-Events” but some of his closer friends suggested calling it “Craigslist” to emphasize the personal and down-to-earth nature of the list. In its first few years, Newmark ran the site as a part-time hobby, continuing his consulting work full-time during the day. He tried to bring on some volunteers, but they did not pan out as Newmark expected. That is when he had an epiphany. He hired the right CEO and Craigslist took off. Craigslist was earning over $10 million in revenues by 2004. Then, in 2005, for a price tag of $15 million, eBay purchased a 25% stake in the company from a former shareholder. As of 2010, Craigslist was generating more than $122 million annually.

 

 

Action Item #1: Get Out of the Way

 

Action Item #2: Do Things Better

 

Action Item #3: Listen

 

 

True Story 

 

Despite his professional successes, Newmark struggled personally. He enrolled in ballet and jazz dance classes in order to meet women only to wind up in the hospital with a hernia. No matter what most people say, one of the biggest reasons Newmark started Craigslist was because of his struggling personal life. He is a self-admitted nerd, which really turned off women. He thought it was a good idea to start helping people by starting an email service for others like himself.

 

After finally getting too many people using his email service, Newmark started Craigslist. According to him, it is the reason he has the girlfriend he has today. He likes to say that Craigslist has prevented hurting himself just to meet women. Out of this struggle for personal contact, Newmark built one of the top-ten websites in the world. According to recent statistics, more than five million people use the site every month and more than one billion pages of Craigslist are looked at every month.

 

 

Quotes 

 

“There are different flavors of libertarianism, but my take is that its core values ‘treat people like you want to be treated’ and ‘live and let live,’ which works for most humans.”

 

“It has helped people who have a hard time meeting other people. They’re using the site and becoming friends, lovers, and every possible twist on those two situations.”

 

“I admit that when I think of the money one could make from all this, I get a little twinge. But I’m pretty happy with nerd values: Get yourself a comfortable living, then do a little something to change the world.”

 

“Follow through with basic values, and remember to provide good customer service.”

 

Everything is a state of mind: Amalia Ghiban

Everything is a state of mind: Amalia Ghiban

She considers herself a global citizen and after trying out various areas in economic background she decided to follow her passion about people and become a life coach. After going through a tough period of time with some failures and a race for self-awareness, she managed to make a 180 degree turn in her life and found her place in the world. She explains to us how success and failure is the two sides of the same coin but also how our feelings become our beliefs, our beliefs become our values and then our values become our behaviors that determine our lives. She believes in us as we should believe in ourselves.

 

The importance of a WRITTEN family business succession plan

The importance of a WRITTEN family business succession plan

Why does “selective-amnesia” often kick-in when discussing business issues?

Finance Talk: The Business Plan

Finance Talk: The Business Plan

What is the number one tool a new advisor should use on a daily basis?

Saygin Yalcin – Business Plan

Saygin Yalcin – Business Plan

Saygin Yalcin is the Founder and President of the first and largest online private shopping club in the Middle East, Sukar.com, Vice President at Souq.com and Partner at Jabbar Internet Group. Moreover, Saygin is Academic Lecturer of Entrepreneurship and Ecommerce at the Canadian University of Dubai, one of the leading universities, research and teaching institutions in the UAE.

Saygin has founded Sukar.com and in less than a year, the company has become the most successful e-commerce startup in the Middle East and, with Saygin at its helm, has grown into a multi-million-dollar business.
More than 1 million shoppers have invitation-only access to fashion, lifestyle and luxury products through daily offers at privileged prices. The club operates across nine countries, including the GCC, Jordan, Lebanon and Egypt.

Souq.com, the largest online retailer in the Arab world has acquired Sukar.com in April 2012. With the investment of Tiger Global, Naspers (MIH) and Jabbar Internet Group in October 2012, the new Souq Group has been formed.

Prior to founding Sukar.com and collecting experience at multinational corporations, such as L’Oreal, the BMW Group or Capgemini Consulting, Saygin was Founder & CEO of Joe Suis GmbH; a premium luxury house for high end leather handbags and diamond jewelry, collaborating with online shopping clubs as major distribution channels.

Joe Suis has successfully been acquired by KupiVIP.ru to become one of the most successful private labels in Russia.

Saygin holds an international master’s degree in business administration and economics, having studied at top business schools in Germany (WHU), the USA (USC) and Mexico (ITAM). He is fluent in German, English, Spanish and Turkish.

 

Business Plans: Jim Goetz, Sequoia Capital

Business Plans: Jim Goetz, Sequoia Capital

You have an idea and you want to get going. But you hear that a business plan is a critical part of the next step. What are the components of a business plan that you need to develop? Presenter: Jim Goetz, Partner, Sequoia Capital. Recorded: February 27, 2008

 

The Business Plan

The Business Plan

Jim Ellis talks about the elements of a successful business plan as well as common mistakes related to its development and use.

 

Evaluating a Business Idea

Evaluating a Business Idea

This lecture covers the general areas that an entrepreneur should evaluate when considering a new business idea.
Russ Siegelman

 

The Myths of Small Business Growth and How to Overcome Them! by P. John Brunstetter, Ph.D

Every small business leader has been exposed to a variety of “theories” about how to make a business successful. Although many of these theories are prone to be invalid, some proponents continue to base key business decisions on them. The following are the most pervasive, but invalid, “myths” about small business growth and what enlightened small business executives have done to overcome them.

Myth 1: Our customers’ only concern is getting their own needs met.

Fact: Successful companies are passionate about openly sharing needs, wants and expectations with their external and internal (employee) customer. Research confirms that Customer and Employee Satisfaction are highly correlated. Rapid growth is the result of highly satisfying company, customer and employee partnerships i.e., joining forces and responding to the following questions:

  • What will it take to satisfy mutual needs?
  • What are our mutual problems/challenges?
  • Who and what mutual resources are required?
  • How do we become mutually “proactive” to adapt to changing market conditions?

The Myth 1 Bottom Line: Our experience indicates that businesses are more effective
when they treat customers and employees as partners.

Myth 2: All companies should be solely profit driven.

Fact: Recent research throughout all industries suggests that highly profitable companies are value driven, not solely profit driven. Studies of customer satisfaction confirm that customers seek the best value, not necessarily the lowest price. Cost containment that lowers customer service and satisfaction is shortsighted and inevitably a profit drain. The most successful companies live by a consistent set of values, ethics, and business
practices. These are critical cornerstones in the foundation for business growth.

The Myth 2 Bottom Line: Profitability is only one dimension of a business growth strategy. Applied corporate values are equally important. Core standards of behavior and
business practices need to be defined, communicated and rewarded. For example, the
most successful high growth companies make following a “Customers Bill of Rights” and
“Employee Code of Customer Conduct” a key part of each employee’s performance
evaluation.

Myth 3: Charismatic leaders with creative new ideas drive the most successful
companies.

Fact: Our experience clearly supports that the most successful companies are driven
effective operating systems and procedures as well as by leadership. Some entrepreneurs shy away from systems and procedures for fear of being too
“bureaucratic.” Consistent and focused change planning, however, allows the business to
grow and flourish without being dependent on charismatic behavior. The most effective
companies integrate creativity and systematic controls.

Self Test for Small Business Success

1. Would your key customers and employees consider you a business partner?

__ Yes __ No
2. Do you use cost containment mainly to increase short-term profit? __ Yes __ No
3. Has your company defined and communicated to all employees its expected values,
ethics, and business practices? __ Yes __ No
4. Does your business depend on charismatic leadership behaviors to insure work gets done? __ Yes __ No
5. Are your supervisors aware of and responsive to the unique needs and expectations of
their subordinates? __ Yes __ No
6. Is positive feedback and encouragement a critical (80%) part of your culture?
__ Yes __ No
7. Are you and your stakeholders committed to an overall strategic plan to grow
your business? __ Yes __ No

The Myth 3 Bottom Line: Planned change combined with “passionate” leadership gets better results than charisma alone.

Myth 4: Employees are motivated, if not driven by money.

Fact: The money-motivation myth is one of the most persistent and problematic myths despite significant experience and research to the contrary. Each of us is motivated by different things at work, e.g., control, autonomy, recognition, affiliation, peer respect, loyalty, etc. The most successful companies use simple management tools to understand its employees’ unique needs and then train leaders to respond accordingly. When employees’ needs are addressed, they work harder, smarter and with greater creativity. Openness, trust, cooperation and integrity are easier to sustain when employee
satisfaction is more than rhetoric. The most successful supervisors learn and respond to each employee’s unique needs, wants and expectations. Management science has provided powerful tools available to assist the supervisor in motivating employees. The payoff is higher job satisfaction for all parties and increased productivity for the business.

Myth 4 The Bottom Line: Research shows that increasing an employee’s financial rewards does not proportionately increase his/her productivity. Successful supervisors look for and respond to each employee’s unique needs, wants and expectations. They
quickly discover that what is rewarding to one employee is not necessarily rewarding to another. Successful supervisors have a different motivation plan for each employee.

Myth 5: Change is inevitable, so why plan too far ahead?

Fact: Marketplace dynamics and change are inevitable and demand an effective, timely response. The most successful companies develop tactical (short term) and strategic
(longer term) plans based on visions of the future and core values which do not change
significantly over time. Customers and employees need the security of knowing the direction the company is going and that in spite of change there are certain things they can
count on. A plane traveling from New York to Los Angeles is “off course” 95 percent of the time. Business Planning as well as navigation is a continual process of minor course correction without which goal achievement is difficult, if not impossible.

The Myth 5 Bottom Line: Strategic “flight planning” gives the stakeholders the most control possible over changing events and circumstances. The more volatile the environment, the more critical the change planning process.

Myth 6: Too much positive feedback makes employees complacent and lazy.

Fact: Employees cannot get too much encouragement. The smallest kudos go a long way. Employees respond better to constructive feedback when their “bank” of positive feedback is full. To be effective, each constructive feedback received by an employee
must be balanced with 5 positive feedbacks. Of course encouragement must be sincere,
timely and authentic. Surprisingly, supervisors often need to be trained on how to give (and receive) positive feedback. Ironically employees tend to slack off and get lazy when they don’t get enough positive feedback.

The Myth 5 Bottom Line: Employees and the companies they work for grow better and faster when 80% of the feedback employees receive is positive and 20% is constructive.

The Business Success Formula:
The most successful approaches to managing change and business growth include:

1. Become partners with your customers and employees to determine mutual needs and wants and expectations.
2. Define the corporate values needed to drive performance and customer satisfaction at all levels.
3. Integrate tactical and strategic change plans at all levels.
4. Measure results and do course correction.
5. Reward successful team/organizational performance tangibly and intangibly.
6. Enjoy the benefits of continued profitable growth and pass on your legacy to others.

Dr. Brunstetter is an Executive Coach & CEO of Team Interplay, Inc. and Organizational
Development Strategies, Inc. Each company provides some of the most unique and contemporary tools, training and change consulting being offered in business and
industry today.