Small Business News
How to avoid 50 percent of all hiring mistakes by learning to engage the analytical, creative, and emotional centers of your brain when interviewing job candidates
Over the course of 35 years and 5,000-plus interviews as a recruiter, I've developed an interviewing method that identifies superior candidates about 85 percent of the time. I call it the two-question performance-based interview (a.k.a. the Whole Brain Interview). It starts by recognizing that the brain consists of four core parts:
- The left brain, which is more analytical and process focused
- The right brain, which is more creative and intuitive
- The emotional brain--limbic system--which is how we make dumb decisions, like judging someone as friend or foe within seconds of meeting them
- The decision maker--prefrontal cortex--which takes inputs from these other three regions and makes some type of well-balanced decision, at least in theory
In practice, however, the emotional brain's friend-versus-foe response too often controls our interviewing behavior and hiring decisions. When a first impression is negative, the interviewer asks hardball questions in a vain attempt to escape the uncomfortable situation. When an initial response is positive, the interviewer asks softball questions, leans forward, and goes into sales mode. I estimate that 50 percent of all hiring errors are due to this subconscious reaction.
Interviewers are not all influenced to the same degree by this emotional response. Techies are the least affected; if you look closely, you'll see that their left brains are a bit bigger than those of most people. As a result, they tend to be conservative, they're less willing to make a decision without lots of proof, and they value experience and depth of technical skills over potential. As a result, most of their hires are rock solid, with few superstars.
Those whose heads tilt to the right (physically, not politically)--typically managers and executives--place more trust in their intuition and rely less on facts and evidence when making decisions. From a hiring standpoint, they concentrate on a too-narrow set of traits: strong communication skills, intelligence, and assertiveness. As a result, they typically hire people who excel at planning and strategy but aren't necessarily strong at building teams, executing projects, and achieving results.
Then there are those who just go with their gut reaction. Salespeople tend to fall into this category, and their hiring results are often across the board, with wide and violent swings in either direction. This is typically why sales jobs have higher turnover than most positions. The two-question performance-based interview corrects all of these problems. Here's the process:1. Suspend Judgment
Wait 30 minutes into the interview before making any judgment about the candidate. Use that time to collect objective information about the person rather than asking biased questions. Screening candidates by phone first will help minimize the impact of first impressions.2. Conduct a Screening Interview
At the beginning of the screening phone interview, review the candidate's work history in detail, with a focus on general fit and the Achiever Pattern. The Achiever Pattern indicates that a person is in the top 25 percent of his or her peer group. For example, a great engineer might have a bunch of patents and may have recently spoke at some major convention.
If the person possesses the Achiever Pattern, determine specific job fit by getting detailed examples of accomplishments that best compare to the actual performance requirements of the job. This is the Most Significant Accomplishment question I described in an earlier post. This is a left-brain question.3. Gauge Problem-Solving Skills
To tap into right-brain thinking and problem-solving skills, ask the candidate how he or she would go about solving a real job-related challenge. Get into a discussion focusing on how the candidate would figure out a solution. Then, to ensure the person isn’t just a good talker, ask about a major accomplishment most comparable to the challenge being discussed.4. Score the Talent
To further mitigate the team's tendency to make biased judgments, I suggest the use of a formal approach to sharing evidence when making the hiring decision. The worst type of evaluation is adding up a bunch of yes/no votes. There’s a talent scorecard in The Essential Guide for Hiring & Getting Hired that describes how to organize the assessment around 10 core factors we’ve seen best predict on-the-job success. Here's a link if you'd like to receive a sample copy.
Somehow, the human brain doesn't work properly when making hiring decisions. The Whole Brain performance-based interview was designed to sort through this hodgepodge of emotions, biases, and semifacts in some logical way to generate a reasonably accurate decision. According to my own experience, it works. However, I still won't formally recommend a hire without a full background verification, a rigorous reference check, a personality and style assessment, and a positive gut reaction.
Beware of candidates like the Chatterbox, the Chameleon, and the Mobile Device Maven, whose behavior during the hiring process portend the disastrous effect they could have on your company.
There are some clichés that, though old and somewhat tired, still ring true in the workplace. A company’s greatest assets do ride up and down the elevator every morning. And a few rotten apples do spoil the barrel.
As the co-founder of a 100-plus person strategic communications firm, I’ve conducted hundreds, if not thousands, of job interviews over the years. And with each passing year, I seem to get a little bit better at spotting a potentially toxic hire. So here, with the assistance of my crack intern committee managers Samantha Bruno, Jason Green, Julie Hoang, and Kristin Davie, are 13 types of interviewees you should avoid at all costs.1. The Helicopter Millennial
This is the young lady whose mother accompanies her to the interview, waits patiently in the reception area, and then asks Buffy how it went afterward. Thanks for coming, mom, but my business needs fully formed and functioning adults.2. The “What’s in It for Me?” Guy
He’s the man who’s more interested in vacation time, sick days, raises, titles, and promotions than in making a contribution to Peppercomm. Sorry, pal, but there’s no I in team.3. The Sports-Analogy Asshole
For some reason, people assume I love all sports simply because I climb mountains. As a result, I receive job inquiries that use phrases such as “I can hit the ball out of the park for you” and “I’m the missing piece in Peppercomm’s Super Bowl team.” I also get emails from people who tell me they’re the “sherpa” who will “lead my business to the summit.” I don’t hire people who assume they know me when they don’t.4. The Guilt Tripper
“Hi. My name’s Bob Smith, and I’ve been out of work for 18 months. Having read about your culture, I know I’d fit in perfectly. When can we meet?” Guilt may work in other settings, but not in the workplace. We hire winners. As for the actual meeting date, how does the 12th of never strike you, Bob?5. The Blank Expressionist
This job applicant lacks the drive to research our firm in advance and is unable to formulate at least one intelligent question during an interview. As a result, she answers our questions but responds with a blank stare when we ask if she has questions of her own. Sorry, but we aren’t looking to hire toll booth collectors at the moment.6. The Chatterbox
Some candidates simply never stop talking during an interview. Though we appreciate their need to highlight their skills and achievements, the chatterboxes do need to hit the Pause button every once in a while. Some will go so far off on a tangent that they’ll actually say, “I’m sorry, what was the question again?” The Chatterbox really should be interviewing for a telemarketing gig at Publishers Clearing House.7. The Minimalist
This guy is also known as One-Word-Answer Andy. We respect good listeners. But we also appreciate a more in-depth response than, “Yup.” Prying answers out of the Minimalist is like pulling teeth. And as of today, we have no plans to expand into the oral care field.8. The Hyperbolist
This is the woman who tends to stretch the truth just a wee bit in her résumé. It’s relatively simple to spot the Hyperbolist and even easier to out her on a purported “major accomplishment” during the interview. When pushed, she’ll always back down and confess to far more modest credentials. Braggarts belong in boxing, basketball, and inside the Beltway. Not in business.9. The Chameleon
My firm now features many new and evolving service offerings. And that’s just fine with the Chameleon, because he’ll accept any job in any division. Though we value open-mindedness, we also tend to hire prospective employees who know exactly what they like and dislike. We don’t try to be all things to all people, and we won’t hire candidates who think that way. Chameleons need not apply.10. The Drama Queen
This is the job applicant who just casually drops by our office without an appointment and demands an interview right on the spot! Aggressiveness is prized in public relations, but the Drama Queen is clearly desperate and looking for attention. We typically suggest she pay a visit to the corner of Hollywood and Vine instead.11. The Improvisation King
This is the dude who just strides into an interview completely unprepared to talk about his relevant work experience. He’s also a big fan of the words um, like, and totally. When asked to elaborate on an assignment with a previous employer, he’ll sigh and say, “Yeah. Hmmm. Like, I’m not even sure why I wrote that.” Yeah, and um, like, we’re not sure you’ll ever find a job anywhere, dude.12. The Sloppy Joe
This guy simply cannot be bothered to double-check what he writes or says. After we acquired two smaller firms recently, one Sloppy Joe sent me a note congratulating me on our “accusations.” On another occasion, a Sloppy Joe mailed me a letter saying Peppercomm was “infamous” on his campus. In person, he’ll call my firm PepperCorn or, believe it or not, LeperComm. Sloppy Joes are true rotten apples whose laziness can be contagious and, if it spreads throughout the organization, potentially fatal.13. The Mobile-Device Maven
This woman sits down alongside me, pulls out her mobile device, and places it between the two of us. She then proceeds to check it every few minutes or so to see if anything urgent may have occurred. Something urgent occurred, all right. The Mobile-Device Maven just lost her chance at a gig with my firm. In a job interview, it’s me or the mobile device. Take your pick.
So, there you have it. My baker’s (dirty) dozen of the workplace. Have I missed identifying any other suspicious characters? If so, please let me know. After all, an entrepreneur can never have too much knowledge on any subject, especially one as critical as hiring the right (or wrong) person.
Investors include Google board member Ram Shriram, Virgin founder Sir Richard Branson, HP CEO Meg Whitman, Wordpress founder Matt Mullenweg, and author Tim Ferriss.
Garrett Camp, the cofounder of Uber and StumbleUpon, has raised $50 million from investors to fund the design and development of new companies. Investors include Camp himself, Google board member Ram Shriram, Virgin founder Sir Richard Branson, HP CEO Meg Whitman, Wordpress founder Matt Mullenweg, Behance founder Scott Belsky, and author Tim Ferriss.
Talk about an all-star team.
Expa, Camp's latest venture, calls itself "a startup studio that works with founders to develop and launch new products." Expa Capital--what the $50 million was raised for--is Expa's investment arm, which will initially invest between $500,000 and $1 million in seed capital in each company, focusing on mobile applications, platforms, and marketplaces.
In a short phone interview with Inc., Camp explained that $500,000 to $1 million was not necessarily a limit, just a starting point. "It will start at that, and then I'd [potentially] invest in additional rounds as well," he says.
Of course, in other cases, the initial seed money might be all a startup needs to go from idea to the marketplace. "With a lot of mobile apps, you can just hire a team and get a product out the door," he adds.
Part of Expa's overall mission involves helping startups build a path from their on-paper inception to becoming a product with actual customers. Though finding a market for your idea is obviously important, Camp is a big believer in the inspiration that comes from initially building a product for yourself.
"You're going to have that passion to build it, and you'll get excited about that," he says. "Because you, personally, will want it to exist. You'll put a lot of care into it. That's what I did with Uber. I basically created it because I couldn't get a cab.
"And now a lot of people use it."
You can overcome the worst online review if you follow these tips.
If you want to build brand loyalty in an age when 80 percent of consumers look online to see what other people think instead of just sticking with a brand they know, you have to be smart about both the quality of your product and the experience of buying it.
Customers have moved beyond unquestioning brand loyalty and toward quality, and they will go where they find it, primarily because information is easily accessible by way of the Internet.
This is a major evolutionary change in the world of brands. In the old days, consumers looked to advertising or their past experiences with a company, which served as a proxy to figure out a new product’s reliability and worth. Brand loyalty was a way of reducing risk.
Today, with easy access to expert reviews, user reviews, detailed report data in an array of categories, and transparency in every good and bad company behavior, the power of brands is truly weakened. A brand’s value may easily plummet, especially when the next competitor offers something similar that's judged to be just as good.
But there are still ways to make your brand more sticky and your customers more loyal. Here are three tips (hint: customer service is key).1. Deliver on the product’s promise every time.
The benefits of your product have to be apparent and consistent. If you sell yoga pants and you say they fit great, keep you demure during a public practice session, and will look like new wash after wash--make sure they do.
Lululemon’s founder Chip Wilson learned that lesson the hard way when a social-media maelstrom ensued after some customers started complaining that the brand’s garments became see-through during their yoga workouts. Instead of simply agreeing to look into the complaints, Wilson responded that not everyone is fit or thin enough to pull off his company’s pull-on pants.
The major mistake Wilson made was believing that his preferred customers were so brand loyal that they wouldn’t care that he insulted an entire demographic of women. Women quickly ditched the chauvinist brand and found substitute products.
So disastrous was the double whammy of failing quality and a condescending founder that as of January 2014, Lulelemon’s stock price was still in the tank while rivals benefited from customers switching brands.2. Over-deliver on fixing mistakes.
If you screw up on a product promise, fix it--and consider telling a story about the fix. Put your CEO in an ad or post a video on social media showing him or her tossing defective products in the trash, with the promise that better products will appear on store shelves ASAP. Showing your authenticity in this way makes the brand believable, so customers are more likely to give you another chance.3. Be inclusive, not exclusive.
When singer Kelly Clarkson wanted to buy a large number of iPods for orphans from Best Buy, the store refused to sell the goods. Sounds ridiculous doesn’t it? The store decided to adhere to the company policy of putting iPods aside for specific customers. Though the company changed its mind after Clarkson talked about the incident on social media, it was too little, too late and a potentially great PR moment was destroyed.
Do you really want to be known as a brand that doesn't want to serve a certain group of people? Ask yourself some serious questions about whether avoiding certain paying customers can really help your brand. A gaffe that comes out online can ruin your best laid plans.
In an era when a tweet or a bad Yelp review can tarnish your brand--and sales--you have to focus more on the customer experience. Wowing the customer will bring you brand loyalty.
No budget for advertising? Maybe you're better off.
You have a great product that nobody's buying because they've never heard of it. Without sales, you don't have the money to advertise. Without advertising, you can't build sales.
It's a familiar conundrum, but there might be a good solution: Instead of advertising, give your product away to support worthy causes and build brand loyalty. That discovery helped Barefoot Cellars go from a tiny company in a garage to an international wine brand selling 600,000 cases a year--without placing a single ad.
It came about by accident, recalls Michael Houlihan, Barefoot's co-founder and co-author of The Barefoot Spirit. "The first thing we found out was that when you have an unknown product, many stores won't even carry it because there's limited shelf space. There are stores that will stock you if you commit to $100,000 of advertising because they figure that will make the brand well enough known," Houlihan says.
But the young company didn't have that kind of money. "We were at the precipice of despair," Houlihan recalls. "Out of left field, we got a call from a nonprofit in San Francisco's Chinatown." The caller was trying to raise money for playground equipment for a children's park. He assumed Barefoot was a big winemaker with plenty of money. Would they please help out?
"I thought, Do you have the right number?" Houlihan says. "We're in enough trouble as it is!" He told the caller he had no funds to spare, but that the company had wine it could donate for its fundraiser. Perhaps the wine would loosen donors up and they would write bigger checks. Or perhaps the group could auction the wine to raise cash.
Though disappointed not to get actual money, the caller accepted the wine, Houlihan sent it over and that was that. Until a few weeks later, when the company reviewed its all-important sales figures in San Francisco. "There weren't many sales throughout the city, but the four stores surrounding Chinatown had sold out and had re-ordered from the distributor," Houlihan says. There was only one possible explanation: Partygoers at the fundraiser had enjoyed the wine, appreciated the support of their cause, and gone looking to buy more.
Figuring they were onto something, Barefoot next selected a tony San Francisco neighborhood and went looking for community-based efforts. People there were trying to clean up a stream, so this time Barefoot offered not only wine but also staff to help set up and tear down at the fundraising event. They also asked if they could speak to attendees and tell them a bit about the wine they would be drinking. This time, the results were even more impressive.
From then on, supporting nonprofits became Barefoot's national strategy, and every time the company entered a new market, it would hire a local "Barefooter" to represent the brand for sales and distribution and also find appropriate nonprofits to support. The strategy has worked beautifully, Houlihan says.
"The test [from retailers] usually goes like this: 'We'll try you out in our stores, and if you don't sell 300 cases in 180 days, you'll be discontinued and never be in our stores again.' We passed those tests in markets that didn't know us at all, and the only possible explanation was our support for these local nonprofits," Houlihan says. Sales continued to grow and Barefoot Cellars was acquired by E&J Gallo in 2005.
Want to make donation marketing work for you? Here's Houlihan's advice:1. Don't confuse it with cause marketing.
Cause marketing, in which brands publicize or advertise their support of popular causes as a way to increase sales, is a whole other proposition--usually a much pricier one. "You're buying a sponsorship to show what a great company you are," Houlihan says. "They sell those sponsorships year after year, and you don't get the same kind of loyalty. We weren't going after the general public with the fact that we were supporting a group--we were working with the group in the hopes that its members would have a social reason to buy our product."2. Get creative with your offerings.
Beyond just giving the group your product (or cash) what else can you do to help? In addition to offering setup and teardown assistance, Barefoot helped some causes by hanging tags on its bottles asking for donations. "Imagine the chutzpah!" Houlihan says. "If you buy our wine we'll turn around and ask you for a donation." But the tactic proved an effective way to support some of the causes Barefoot cared about.3. Make it a two-way street.
"It's not a giveaway," Houlihan says. For every donation you make to a nonprofit, you can request something in return. "Would you be willing to announce a thank you from your podium? Thank us in your newsletter? Let one of us speak at your event to tell people about the wine they're drinking? Put a list down by each placement telling people where the product can be purchased? These are all easy things for a nonprofit to do."4. Find causes that fit your product.
For Barefoot Cellars, that often led to conservation efforts. For instance, it supported the Surfrider Foundation's Blue Water Task Force, which tests ocean water to try and identify the source of pollutants. Barefoot Cellars created a bottle tag for the effort showing toes hanging off a surfboard and urging purchasers to "Hang 10 for clean water."
"We're Barefoot," Houlihan says. "You wouldn't want to step on a piece of glass on the beach or put your bare foot into polluted water." At the same time, he noted, many of the company's customers were mothers of kids who spent much of their time in the ocean. "They might say, 'Wow, I didn't realize the Surfrider Foundation was the only one testing the water--I thought the government was doing it," he says.5. Don't count out political causes.
Many companies don't like to get mixed up in politics, but Houlihan says it can be an effective tactic if you connect with a cause that aligns with your beliefs. For Barefoot, one of those causes was LGBT (Lesbian, Gay, Bisexual, Transgender). "We got involved with them in the 1990s, when they were marginalized," he says. "We gained a very loyal following because we came out for their rights at a time when it wasn't mainstream."6. Don't expect to set it and forget it.
Marketing-by-donation needs to be managed on an ongoing basis just like any other form of marketing, Houlihan says: "Someone might call and say, 'I'm the new executive director of this nonprofit, and you must support us with a $50,000 donation if you want to continue being our sponsor.' I don't blame them--they need to raise money and many of the large corporations do help nonprofits with big donations. Small businesses can't afford those sponsorships, though." That means you have to constantly be on the lookout for other nonprofits you might support.7. Don't spoil it by buying an ad.
"Ironically, we got to the point where we could afford advertising and we decided not to do it," Houlihan says. Why ever not? "We didn't want to stop the flow of word-of-mouth," he explains. "It's like me telling you about a great pizza place you never could have found any other way. But if I see a big sign for Joe's Pizza, then I'm not going to say anything because there's another way you could have found out. It's no longer so special."
After thinking about it, Barefoot's founders decided it was their brand's promise to spread the word through nonprofits. "We decided to keep that promise," Houlihan says.
Like this post? Sign up here for Minda's weekly email and you'll never miss her columns.
Make no mistake: Viral marketing doesn't just happen by accident. Here's what's usually behind an ad that gains a crazy following.
Viral marketing: What more could you ask for? You've seen it happen with big companies and small, when an ad or a video or a post suddenly shows up everywhere. It's practical ubiquity, baby, and it can make your cash register go ka-ching.
But despite the hype, chances are overwhelmingly good that most of your material, even if it picks up a lot of interest, doesn't hit the big time. But why? You're good to your parents, work hard, and floss after meals.
The problem you face is that, in raw numbers, Only a very small percentage of marketing goes viral. There are three reasons why, according to Peter McGraw, a professor of marketing and psychology at the University of Colorado Boulder and co-author of the forthcoming book, The Humor Code, which is about what makes things funny. The good news is that there are a few things you can do to radically improve the odds once you understand the problems.Fix your definition of 'viral.'
Viral marketing should mean users interact and the material is contagious. "You [would] get this exponential effect and eventually you reach a million people," McGraw says. "Very rarely is anything passed on from individual to individual and eventually reaches millions of people. The only thing that gets passed on are viruses, either human or computer."
As a large scale study by researchers at Yahoo found, "adoptions resulting from chains of referrals are extremely rare." Furthermore, even when referrals worked, they were generally within one degree of "a few prominent individuals." So the working definition of viral marketing should be that the entrepreneur finds a way to drive a lot of views through a smaller number of contacts.Provocative isn't enough.
What do you pass along? Maybe something funny, touching, shocking--in a word, provocative. That's fine, and it might get you or a friend to look at something, but that's not enough. You need to get the attention of the individuals or organizations that can effectively spread your message. That changes the way you create and structure the content.Viral doesn't necessarily mean free.
In theory, viral marketing could certainly cost little or no money, but, oh, if only that were generally true. Some of the most effective viral marketing has a lot of money behind it in ways you may not realize. There may be entire television advertising campaigns designed to advance the reception of a viral campaign.
Now, even though I've heard of people who claim they can make content go viral, no one can really guarantee that. Even the sites most successful at pushing popular content have hits and misses. However, there are steps you can take to improve your chances.
Successful viral marketing isn't accidental so much as it's smart PR. So plan accordingly and avoid the hit-or-mostly-miss approach. Oh, and McGraw suggests reading two books to better understand the phenomenon: Made to Stick, by brothers Chip and Dan Heath, and Contagious: Why Things Catch On, by Jonah Berger.
Credit bureaus have shown how a lack of attention to customers can have dire consequences for your business.
Let’s pretend you placed an online order and the retailer mistakenly sent you the wrong item. It happens.
But imagine this mistake ultimately costs you time, money, and peace of mind. Your next step is predictable: You call the company to get the issue resolved as soon as possible. With one industry, though, it won’t be as easy as picking up the phone. Instead, you may need to file a lawsuit.
According to CBS’s 60 Minutes and the The New York Times, credit bureaus have designed their business models to account for legal action brought by consumers. Indeed, the actions of the three big credit reporting agencies--Equifax, TransUnion, and Experian--make them seem so allergic to customer service that they would actually rather you sue them than go through traditional customer service channels to get your issues resolved.
There are even websites and forums dedicated to helping people break through the customer service walls put up by these companies. The general consensus is that if the credit bureau does not respond, your only option is to file court papers or a complaint with a government agency. How’s that for options?
How has it come to this? Most industries in the U.S. operate with considerable competition, and businesses that take the best care of their customers will typically beat out the rest. Good businesses are rewarded with repeat purchasers. Bad businesses create disgruntled customers and, if there’s no improvement, naturally go out of business.
Industries with structurally limited competition, on the other hand, create a very precarious environment for consumers.
Now, I’m not here to launch into a discussion about government regulation and free market politics. But it’s clear that if consumers “feel trapped”--as a source quoted in the Times article described--the credit bureau industry has failed us.
The disastrous state of customer service in this industry brings to light a few important lessons for leaders of any organization:1. What goes around comes around, even if it takes a while.
As evidenced by the increasingly large penalties, as well as the public shaming of these companies in the media, iniquitous business practices will eventually find the spotlight. Even though the industry is firmly entrenched, it’s attracting enough negative attention that consumers, businesses, and even government bureaucrats are starting to effect change.2. Top talent doesn’t want to work at tarnished brands.
If you’re a superstar in your field, would you rather explore job opportunities at companies with great reputations that are known for upstanding business practices, or at companies with notoriously bad customer service? Weak talent breeds weak leadership and poor decision-making, which leads to a spiral effect that ultimately undermines any potential the business had to begin with.3. Know who your primary customer is.
There is one thing the credit bureaus have figured out: They know who their primary customers are, and it’s not you and me! Banks and other types of lenders are the main drivers of the credit bureau business model. The credit bureaus will continue to make decisions and allocate resources according to what banks and lenders value most (at least until the lenders are forced to internalize the problems caused by the credit bureaus, or the Consumer Financial Protection Bureau reorganizes the system). No matter the organization, it’s critical to identify who your primary customer is, what that customer values, and how you’re going to create the building blocks that best serve your customers.
You have Wi-Fi, plenty of storage, and a 'fast-enough' processor. What else do you need in a computer? Try a supercrisp, high-resolution display, and you may never go back.
You have Wi-Fi, plenty of storage, and a "fast-enough" processor. What else do you need in a computer? Try a supercrisp display, and you may never go back. Check out this new crop of high-resolution 3K laptops: They make photo editing easier, improve the quality of video streams, and give your everyday Web browsing a boost.--John Brandon
This workstation laptop's screen is so clear, it makes you wonder how you ever got by with a lesser device. The 15.5-inch display runs at 2880x1620 pixels and uses a technology called In-Plane Switching (IPS) for a wide 180-degree viewing angle. Using the Sony Movie Studio app, a marketing video had none of the typical jagginess of other laptops. Battery life runs about six hours, and the system has a fast Intel Core i7 CPU and NVIDIA graphics. The base price for the W540 is about $1,319, but the system I tested was $2,326.
This sleek all-white laptop uses a 2560x1440 pixel screen--a dramatic improvement from the standard 1920x1080 resolution of the previous model (and most current laptops). Photos and videos looked as crisp and colorful as a living room HDTV. The laptop also provides Intel WiDi tech for sending the display to a projector or TV over wireless. Battery life is around seven hours, and you can configure the Aspire S7 with either an Intel Core i5 or i7 processor.
The 2880x1800 pixel 15-inch display on this MacBook Pro is something to behold: it's bright, clear, and colorful. Like the Lenovo W540, the IPS tech helps reduce glare and provides a wide side viewing angle of about 180-degrees. The extra resolution helped with removing slight blemishes in a headshot using Adobe Photoshop. The Intel Core i7 processor is quite speedy for video editing and Photoshop retouching. Battery life runs about eight hours on a charge. The 15.6-inch screen on the Dell XPS 15 is just a bit bigger, though.
Blazing a trail with the highest-res 15.6-inch screen I've ever tested, the Dell XPS 15 run at a stunning 3200x1800 pixels. That's amazing picture quality for photo editing and video editing in apps such as Sony Movie Studio and Adobe Photoshop. Marketing agencies will love the clarity for making brochures and printed materials. Battery life runs about nine hours for the system I tested, with NVIDIA graphics (required for the high-res screen) and the Intel Core i7 processor. Overall, the Dell XPS 15 was my top pick for the best (and biggest) display.
Like the Dell XPS 15, this laptop runs at 3200x1800 pixels but at the 13.3-inch size--that means, more portability but not as much screen real estate. Going hands-on at CES 2014, the display looked so sharp I noticed the text in a business document had a much finer edge even when I zoomed in closely. Videos and photos also looked vivid and clear. The Book 9 Plus uses an Intel Core i5 processor and runs for about seven and a half hours per charge.
Are we in a bubble? Here's the answer to the question everyone is asking.
Everywhere I go, everywhere I speak, I get asked this question: Are we in a bubble? I've been getting asked that question for at least four years now. It's hard to sustain a bubble for four years. But we're also not in a normal valuation environment for high growth tech companies, and we haven't been in one for a while.
Here's the answer I've been giving:
I learned in business school that the multiple of earnings one should pay for a business is roughly the inverse of interest rates. The reason for that is if you buy a business that makes $10 million a year and pay $100 million for it, then you're effectively getting a yield on your investment of 10 percent (annual earnings/purchase price). This math is terribly simplistic but fine for the purposes of this post. If interest rates are 5 percent instead of 10 percent, then you would pay $200 million for the business ($10 million/$200 million = 5 percent).
So the math here is interest rates = annual earnings/purchase price. Again, this is very simplistic because it doesn't deal with the important questions of what interest rate you use, how you deal with earnings that are growing or declining, and a host of other issues. But at the end of the day, this math (annual earnings/purchase price = yield) is fundamental, and everything about asset values, capital markets, and valuations stems from it.
Since the financial crisis of 2008, policy makers in the developed world have kept interest rates at or near zero. They have flooded the market with cheap money in an attempt to heal the wounds (losses) of the financial crisis and give business owners the incentive to invest and expand their businesses. That hasn't worked particularly well but it has worked a bit. Though their words have changed in recent years, their actions haven't changed very much. We're still in a policy framework where money is cheap and interest rates are near zero.
If you go back and apply the formula (yield = earnings/purchase price) and use zero for yield/interest rate, then you would pay an infinite amount for an earning stream. Of course that doesn't make sense, and it hasn't happened. But valuations are at extreme levels because you cannot get a decent return on your money doing anything else.
At some point this will change. The yield on the 30-year treasury yield has been sub 5 percent since the financial crisis. If (when?) it gets back to the 6 percent to 8 percent range, where it was for most of the 1990s, we will be in a different place. Here's a 40-year history of the 30-year treasury yield. You can see that we have been in a very low rate environment for a while now.
The other thing we have noticed is that this low-rate environment has caused asset value/earnings ratios to be non-linear. What you normally see is the value/earnings ratio grows linearly with earnings growth rates. If earnings are growing 20 percent per year, you get a value/earnings ratio of X. If earnings are growing 40 percent per year, you get a value/earnings ratio of 2x.
But what we're seeing is you get something that looks more exponential than linear when you start modeling this out at higher earnings growth rates. When earnings growth rates get to 50 percent to 100 percent per year, and look like they can continue to grow at that rate for a number of years, you get value/earnings ratios that are eye-popping. It seems that investors are so starved for returns that they are willing to pay that much more for earnings that can grow quickly.
It's the combination of these two factors, which are really just one factor (cheap money/low rates), that's the root cause of the valuation environment we're in. And the answer to when/if it will end comes down to when/if the global economy starts growing more rapidly and sucking up the excess liquidity and policy makers start tightening up the easy money regime.
I have no idea when and if that will happen. But until it does, I believe we will continue to see eye-popping EBITDA multiples for high growth tech companies. And those tech companies with eye popping EBITDA multiples will use their highly valued stock to purchase other high growth tech business and strategic assets at eye-popping valuations.
It's been a good time to be in the VC and startup business, and I think that will continue as long as the global economy is weak and rates are low.
This article originally appeared on Fred Wilson's blog, AVC.
Don't make rookie mistakes with your online presentation. Here are basic steps to ensure it's efficient and entertaining.
You're in charge of a big project that requires the support of lots of people. It would be easy to engage and inspire them if they were all in your office, but as often happens today, they're spread out around the country. So instead of connecting with each person individually, you decide to set up an online presentation so everyone can hear the same details at the same time in a collaborative manner.
You'll want to make this an effective, efficient process and get it right the first time, so here's a little primer for delivering an effective online presentation.
1. Start with the right tool. You could ask for everyone to jump on a conference call and email them a PDF, but then you don't really know who's there or if they're on the right page. Collaborative software such as Go-To-Meeting or join.me allows you to monitor who's online and makes sure that everyone is communicating about the same slide.
2. Help everyone be on time. Nothing is more irritating than sitting online waiting for a meeting to start because one or two people didn't show up. Some online tools have calendaring features that can help make sure everyone gets there on time and knows the topic. If people do show up late, go ahead and get started so you don't inconvenience the others. Late people can use the software to watch a recording later.
3. Keep your slides simple. Slides with lots of text are confusing and hard to read. Worse, people won't remember much of what's on them. Use your slides as brief reminders of the topic. Use a simple headline and three or four bullet points to support the main takeaway. Later, your team can go back and review the presentation and the brief slides will act as simple reminders.
4. Be clear and efficient. Make sure the presentation is easy to understand and concise. Each slide should represent about three or four minutes of material, and any more than 15 to 18 slides can be overwhelming. If you have more material, consider splitting the presentation. Practice before you deliver your talk to make sure the order makes sense and that you can deliver it with good articulation and at a pace everyone can understand. The record feature on collaborative software is a great tool for reviewing your presentation skills.
5. Make the presentation entertaining. Just because the presentation has lots of factual information doesn't mean it has to be dry and dull. You can add a lot of flair without making your talk unprofessional. Use stories and humor to make it fun. Not only are people more likely to listen closely, they'll remember more of what you told them. Whatever you do, don't be boring!
6. Use visual examples. Words are fine but graphics are great. Find a few pictures that are truly worth 1,000 words. Don't overload the presentation with cutesy art unless it has a purpose truly relevant to what you need to communicate. Taking screen shots off the Web can be really useful when referencing online material. You can even do this in real time for time-sensitive material. If you plan to use video, just make sure it's short and to the point. Otherwise, just share the URL and let people watch on their own time.
7. Encourage conversation. The great part of collaborative software is that it allows people to communicate with the presenter and each other during the presentation through messaging, so the talk isn't interrupted. You should encourage your team to do this from the beginning. Watching the online activity will give you a sense of how engaged your listeners are and allow you to tailor your presentation along the way, if need be.
8. Set action steps. The time to start an action-step list is not during the presentation itself. Ready this list before the presentation. When you're done with the basic information, you can discuss the steps in an organized way and modify them after you get feedback from the team. Make sure everyone is clear on what they need to take away from the presentation.
9. Leave time for questions. If you set an hour for the presentation, at least 15 minutes should be used for questions and discussion. You can review any written questions that were left unanswered and allow for discussion amongst the team. Don't let the questions drone on or get redundant. Manage the session kindly, with purpose and authority.
10. End on time. People are busy and they have most likely scheduled other activities after this meeting. Show them respect by finishing at the designated time so they can move on. If they still have questions or want more information, tell them they can connect with you later. But let everyone else go. Give everyone the software link to review the presentation if needed. Then thank all for their time and get to work.
Like this post? If so, sign up here and never miss out on Kevin's thoughts and humor.
Entrepreneurs tend to work all the time. It shows dedication, but it might not be smart.
"The great thing about owning your own company is that it doesn't matter which 80 hours a week you work."
That comment, from Doreen Garrett, the founder of Otis Technology, struck a chord with me when I interviewed her for my book Women on Top. Being an entrepreneur does give you great flexibility--but most business owners work almost all the time. And that's worrying, because vast amounts of research show that prolonged overwork is unproductive at least--and destructive at worst.Personal Productivity
After working around 40 hours a week, we can all keep going--but, because we're tired, we start to make mistakes. We need extra time to correct those mistakes. So now we've just created a trap: more hours, more mistakes, so more hours.
The way out of the trap is to stop, get rested--and then resume work. How many of us feel we have the self control to do that?
The long hours have a cumulative effect on your productivity. Working for 11 or more hours a day more than doubles the risk of depression and a loss in cognitive function. You may have difficulty finding the right words, thought processes and problem-solving abilities become impaired, you're slower to react, and the ability to be creative gets harder to retrieve. Executives who work three or more hours longer than a normal, seven-hour day run a 60% higher risk of heart-related problems.
Feeling anxious? So did I when I read this research. And it has changed the way I work. Now, when I travel (which I do a lot) I schedule in recovery time. I book time for myself at the gym or a pool. I go to bed earlier and never allow screens, phones, or computers into the bedroom. Most of all, I stop when I'm tired. It's more efficient to go to bed than to persevere.
Engineers responsible for important machinery talk about asset integrity: maintaining and repairing vital equipment before it breaks. In the work that most of us do, that equipment is our brains. Seen from this perspective, it's every business owner's most precious asset. Doesn't that mean you should look after it?
The social-network founder called President Obama and wrote a scathing post on his site to express his frustration over the National Security Agency's covert surveillance practices.
In the most recent example of the clash between tech companies and the government, Facebook CEO Mark Zuckerberg took to his social network on Thursday to voice his anger and confusion over the National Security Agency's Internet-surveillance practices.
"When our engineers work tirelessly to improve security, we imagine we're protecting you against criminals, not our own government," Zuckerberg wrote on Facebook to the social's network's users.
Zuckerberg decided to write the post after news outlets reported on Wednesday--based on information leaked by former NSA contractor Edward Snowden--that the NSA used fake Facebook pages to lure surveillance targets and hack into their computers. Earlier reports said the NSA may also have intercepted user data from Yahoo and Google without the companies' knowledge.
The Facebook founder also wrote that he had called President Obama to express his "frustration over the damage the government is creating for all of our future."
"Unfortunately, it seems like it will take a very long time for true full reform," he added.
According to Reuters, White House officials confirmed the Wednesday call between Obama and Zuckerberg, saying they spoke about "the recent reports in the press about alleged activities by the U.S. intelligence community."
Zuckerberg's missive noted that Facebook encrypts its pages and communications, uses secure protocols for traffic, and offers multiple factors for authentication. In light of the government's reported activities, he wrote, online safety and security need to be a collective effort. "It's up to us--all of us--to build the Internet we want," he wrote.
Rather than accuse your competitors of lying, set industry standards that force them to clean up their act. Here's how it's done.
You already know the recipe for business success: Create a product or a service that people want, make it better than what the competition offers, and then sell it for a lower price. Simple, right?
Not so fast. What if your competitor is lying to the customer? What if they're claiming that their product has functionality that it lacks, or that it's high quality when you know that it's actually a piece of junk?
If customers buy from that competitor, they may eventually find out that they were snookered...or they may not. And even if they do, what if you're no longer in business because your competitor drove you out?
So what to do?
One approach would be to outdo the competitor and tell even bigger lies. That's pretty much what happened in the mortgage business before the Great Recession. What started as a few bad apples eventually rotted the entire business.
But think: Do you really want to build your company around lies? Especially when you've done the hard work of building the better mousetrap?
Another approach would be to accuse the competitor of lying. Such accusations, however, seem self-serving and can easily degenerate into he-said/she-said situations that make you look like the bad guy.
A better approach is to give your customers a tool that will flush out the lies, according to Bob Carr, chairman and CEO of Heartland Payment Systems, one of the country's largest credit-card processors.
Carr recommends providing customers with a "bill of rights" that identifies what they should expect from their vendors, such as transparency of testing results, auditable accounting for inventory transfers, and so forth--emphasizing areas where you're certain your competitors are fudging.
Once you've provided your customers with this tool, "all you need to do to secure their business is fulfill the promises inherent in the 'bill of rights,'" explains Carr. At the same time, your competitor will be forced to struggle to meet those promises, thereby giving the competitive advantage to you.Preorder my new book and get an exclusive bonus chapter plus a signed bookplate. (Note: Once the book's published, both will be unavailable forever.)
Here's where you'll find fellow small business owners getting social online.
The National Small Business Association recently captured a snapshot of the way small business owners use social media. At least half are on LinkedIn and Facebook, according to the report. The NSBA also found that overall usage numbers have been on the rise. Just 27 percent of small business owners said they don't use social media today, compared to 53 percent three years ago.
Below statistics company Statista shows which channels small business owners are primarily using and how.
Focus on a few core components of leadership and you can take your company to new heights.
Company leaders always want to motivate, inspire, and support their people to the absolute fullest. But most go to bed at night suspecting that they're coming up a little short. Maybe more than a little. Take heart: You can become a truly great leader. All it takes is:Perspiration
Great leadership requires effort--lots of effort. And much of that effort revolves around learning: about your people, your operations, your industry, and yourself. Be relentless in your pursuit of knowledge about everything--and everyone--in your business ecosystem.Vision
Develop a clear vision for what your business is all about, and don't lose faith in it. Know in your heart that you and your team can accomplish anything you set out to accomplish if you work together and believe in one another. You will undoubtedly encounter setbacks, but don’t be deterred. Learn from failure and remain confident.Communication
Great leaders communicate sincerely, often, and in many different ways to everyone in their organizations. They inform, provide feedback, and motivate--intelligently and honestly. Connect with all your people and cultivate multiple channels for two-way. When you hear your own words and messages repeated back to you from your employees, or when your employees talk among themselves using your words to describe your vision and goals, then you know you’re making an impact.Collaboration
Form teams and groups that are constituted for maximum effectiveness. Recognize that in order to do their very best work most employees need consistent support and input from co-workers, peers, and managers. When you create this kind of environment, you'll see an immediate impact on productivity and effectiveness--as well as morale.Decisiveness
Highly effective leaders are decisive when called upon to make tough calls quickly and confidently. Take a moment to assess a difficult situation and then calmly and rationally consider your options. As soon as you have the information you need to make an informed decision, make it. Don't let fear of being wrong prevent you from making what you know is the right call.Integrity
Study after study finds that the No. 1 quality that employees want leaders to possess is integrity. Always be candid, forthright, honest, and fair. Treat your people as you want to be treated. Your employees will respect you and respond in kind.Inspiration
When times are tough, be the person that people look to for inspiration. Don't just talk, act. Reassure your employees and help them overcome their own doubts and anxieties. Model the kind of positive behavior you want to see in them.
Like this post? If so, sign up here and always stay up to date with Peter’s latest thoughts and goings-on.
A roundup of the day's news curated by the Inc. editorial team to help you and your business succeed.1. Excuse Me, Mr. President
Facebook founder and CEO Mark Zuckerberg posted a public note Thursday about his frustration with the U.S. government and its Internet-surveillance practices. He said he has called President Obama to talk about his concerns, but Zuckerberg concluded that, "Unfortunately, it seems like it will take a very long time for true, full reform."--Facebook2. March Madness
On Sunday, the teams set to compete in the NCAA March Madness basketball tournament will be unveiled--and your employees are sure to bust out the brackets and start a pool. There's plenty of reason why you shouldn't stand in their way.--Inc.com3. Happy Pi Day!
Today, we celebrate the magical, mysterious 3.14159. More than just an excuse to eat pie, this informal national holiday is also a great example of how an unlikely idea can wheedle its way into the status quo.--Inc.com4. High Scores
Some good news for women business owners: Credit scores for your businesses jumped to 610 on average nationwide in 2013, up from 592 in 2012, according to survey data from alternative financer Biz2credit. Businesses with scores under 600 don't typically get financing, and twice as many women-owned businesses applied for financing in 2013 as the previous year.--Biz2Credit5. Opportunity Knocks
ShopRunner is making a clever attempt to lure away Amazon customers who have been turned off by the just-announced price increase for Prime membership. The company is offering a year of free, unlimited two-day shipping to any Prime members who have yet to renew at the higher price. It's a good reminder to keep an eye out for unexpected marketing opportunities.--Wall Street Journal6. Going After Apple
IDair, a startup based in Hunstville, Alabama, uses smartphone cameras, plus its own patented algorithm and software, to turn fingerprint images into security identification for use in consumer products. Just because a giant like Apple offers similar technology doesn't mean there isn't room to innovate.--BusinessWeek7. Parenting Advice, by Mark Cuban
How do you make sure your kids don't become spoiled from your entrepreneurial success? Here's billionaire Mark Cuban's solution: "I'm not the dad that comes home with a ton of presents. I am the dad that says, 'Pick that up. Take that; put it in the sink. No, you have to earn that,'" Cuban tells Business Insider. "I want them to recognize that the only thing special about themselves is what they make for themselves."--Business Insider
To find ideal employees, these key phrases can help inform your decision.
"I'm a real go-getter who always thinks outside the box, demonstrates thought leadership, and proactively motivates myself!" If this sentence made you cringe, you're not alone. These phrases come from the new CareerBuilder survey on the best and worst résumé terms.
The company surveyed 2,201 hiring managers and HR people to come up with the best of the best and the worst of the worst.The Worst Résumé Terms
1. Best of breed: 38 percent
2. Go-getter: 27 percent
3. Think outside of the box: 26 percent
4. Synergy: 22 percent
5. Go-to person: 22 percent
6. Thought leadership: 16 percent
7. Value add: 16 percent
8. Results-driven: 16 percent
9. Team player: 15 percent
10. Bottom-line: 14 percent
11. Hard worker: 13 percent
12. Strategic thinker: 12 percent
13. Dynamic: 12 percent
14. Self-motivated: 12 percent
15. Detail-oriented: 11 percent
16. Proactively: 11 percent
17. Track record: 10 percentThe Best Résumé Terms
1. Achieved: 52 percent
2. Improved: 48 percent
3. Trained/Mentored: 47 percent
4. Managed: 44 percent
5. Created: 43 percent
6. Resolved: 40 percent
7. Volunteered: 35 percent
8. Influenced: 29 percent
9. Increased/Decreased: 28 percent
10. Ideas: 27 percent
11. Negotiated: 25 percent
12. Launched: 24 percent
13. Revenue/Profits: 23 percent
14. Under budget: 16 percent
15. Won: 13 percent
Considering, according to this survey, the average hiring manager spends two minutes looking at a résumé (and other studies have shown the time to be 45 seconds), it may be worth your time to rewrite your résumé to reflect what hiring managers want to see.
But, if you're the one doing the hiring, stop and realize your own biases and maybe vow to spend a bit more time looking at résumés. After all, it's not about what the résumé says (unless you're hiring professional résumé writers); it's about what the person can do for you.
Though you may want to immediately reject someone because he or she threw a word like synergy around, that might not always be the best course. Take a closer look and see what the person has really accomplished. After all, your goal should be to hire the best people for your business, and that may mean people who aren't the world's best résumé writers.
Wren Studio's viral video of random people kissing for the first time certainly got shared and covered--but who actually benefited?
Few would argue that Tatia Pilieva's video of complete strangers kissing--with 41 million YouTube views logged within three days--is not the epitome of viral. But like most viral videos today, it's far from spontaneous or organic. In fact, "First Kiss" is a vague advertisement for clothing company Wren Studio.
In the classically cynical and reality-distorted world of PR, many will say this is a branding masterpiece, an amazing way of getting Wren Studio's name out there. A bootstrapped, socialized, fashion-focused version of sponsoring a NASCAR team, for example.
In the end, however, the Wren Studio tweet announcing the video got just over 450 retweets. And CEO Melissa Coker's YouTube post of the video (with the tagline "to celebrate the debut of our Fall '14 collection, we asked 20 strangers to kiss for the first time") has been seen only 100,000 times. The YouTube version with the millions of views bears only a vague reference to the clothing company--a tagline that reads Film Presented by WREN. In a beautiful moment of entertainment-industry grandstanding, the artist took (as she should) the credit, the views, and the press.
But that's not where Wren Studio's marketing stunt really failed to live up to its potential.
Coker's YouTube page is barely professional, awfully organized, and strangely unbranded. Plus, the Wren Studio site has no landing page for the video with social-sharing buttons to encourage more branded sharing.
I've tried and tried, but I still see no measurable benefit to Wren Studio here. Even with a big sign reading WREN STUDIO in each frame of the clip, I'm not sure any viewer would click out of YouTube and into a Wren shopping spree.
"It's a beautiful short film that does absolutely nothing to sell clothes or leave any sort of brand impression for Wren," says viral-marketing expert and author of Social Media Is Bullsh*t, B.J. Mendelson. "If I hadn't read the Fast Company article, I would have had no clue that the video was part of a marketing campaign, and maybe that's what they wanted, but the whole 'unbranded content' thing? Unless you're P&G and have the time, resources, and most of all, the patience to pull something like that off, it's a waste."
Late last year, Mendelson famously criticized BlendTec for calling its "Will It Blend?" videos viral when they really caught fire thanks to corporate intervention and cold, hard advertising.
BlendTec's success (measured in awards and sales) is a great reason why companies are aggressively pursuing viral video opportunities like "First Kiss." The problem? Like drunks at a craps table, marketers tend to throw money at the next big potential "win" without realizing the actual cost (or potential success) of a positive outcome.
"Everybody throws around the term viral these days, even if the content in question is totally manufactured, fake, or engineered to have the appearance of being viral," Mendelson says. "The truth is, there's virtually nothing these days that's actually viral. What we have now is a term that's been absolutely ruined."
Wren Studio's results are exactly what you would expect to receive from a bad PR firm--lots of vague mentions in a way that will not noticeably drive sales, or even remotely increase the brand's presence in the market. These stories weren't featured in Woman's Wear Daily, or New York Magazine's "The Cut," or Vogue--or indeed many places that dealt with the buying and selling of fashion products.
Whatever the original plan, "First Kiss" has become an amazing marketing campaign for an amateur filmmaker, but Melissa Coker no doubt sunk time, money, and energy into the project. For Pilieva, the outcome is amazing: She's created something pervasively, culturally interesting, something that has people interested in discussing its very meaning.
Do any of these people care about Wren Studio? Nope. Will "First Kiss" help to sell enough pretty dresses to offset its cost? I seriously doubt it, no matter how many views it racks up.
This is majorly last minute, but if you haven't filed your taxes yet, you still have options. Here's a look at new features to expect this year, as well as tips on how to file an extension.
This upcoming Monday isn't just St. Patrick's Day, it's also tax day for many small-business owners.
If you own a corporation that reports on a calendar year, March 17 is the tax-filing deadline for your corporation’s income-tax return for 2013. March 15, the normal filing deadline, is a Saturday this year.
While surely many of you have long ago prepared for this annual filing deadline, there are bound to be many who have let it slip. If you're one of them, you'll obviously be crammed for time. To cut through the morass, here's a brief outline of the new features and requirements that you should know before you file, as well as tips on how to file for an extension:New 2013 Forms and Schedules
Regular, or C, corporations file Form 1120, while S corporations file Form 1120S. There are some changes related to Form 1120S to consider. S corporations may need to complete a new Schedule B accompanying their Form 1120S. This schedule is required if they have any shareholder who is a disregarded entity--that is, a limited-liability company with one owner, trust, or estate.
S corps also have to complete Form 1125-E to report compensation paid to owner-employees if the corporations’ gross receipts are $500,000 or more. This form wasn't mandatory for S corporations in the past.A New Medicare Tax for Some Shareholders
S corporations generally don't pay taxes. Their owners pay taxes on their share of the corporations’ net income. To enable owners to figure their personal taxes, S corporations must issue these schedules to shareholders. Schedule K-1 tells shareholders their share of income, deductions, credits, and other items.
New on this year’s Schedule K-1 is code U of box 17 for reporting information related to the net investment income, or NII, tax. This is an additional Medicare tax of 3.8 percent on the lesser of net investment income or the shareholder’s modified adjusted gross income over his or her threshold amount that depends on tax-filing status. The former code U of box 17 of an S corporation’s Schedule K-1 has been redesignated as code V to report other information.
Note: A shareholder’s net income from an S corporation is treated as investment income unless the shareholder is active in the business. Participating in daily business activities and receiving a salary from the corporation indicate active participation. There’s guidance from the IRS on determining active participation and other rules for the NII tax. And salaries and other taxable compensation paid to owner-employees of C and S corporations is subject to the 0.9 percent additional Medicare tax if earned income exceeds a threshold amount that depends on tax-filing status.Filing a Tax Extension
When in doubt, you can still file an extension. This will automatically give the business six more months--to September 15--to file the 2013 income-tax return without penalty. Use Form 7004 and enter the correct form code in the box provided for this purpose: code 12 for C corporations and code 25 for S corporations.
Be sure to submit the extension request no later than March 17. This can be done by paper or electronically.
Got a semi-crazy idea, and the need to convince huge numbers of people to adopt it? Advocates for Pi Day are way ahead of you.
If you're a mathematician, physicist, or engineer, you've probably already heard of Pi Day.
If you haven't, you would be surprised by how many people have. Pi Day--a celebration of the number pi, or roughly 3.14159--seems like something only for geeks, but it's also a great example of how an unlikely idea can wheedle its way into the status quo.
Think about it: The founders of Pi Day have taken something only a few people ever think about, and even fewer care about, and turned it into a phenomenon that's celebrated by thousands. Pi Day has also garnered its own resolution in the U.S. House of Representatives (and let's face it, those people can't agree on anything) and has been featured in news outlets from USA Today to NPR.
Granted, Pi Day was started sort of by accident. Larry Shaw, a scientist at the San Francisco Exploratorium, just put out pie for some of the staff on March 14, 1988. The next year, some museum visitors noticed and asked what was going on. Pi Day got bigger--and weirder--from there.
If you're starting with just the germ of an idea and need to convince huge swaths of people to adopt it, there's a lot you can learn from Pi Day.
Start with something real. (But it can be absolutely anything.)
Pi Day celebrates a number. Given that the big holidays are either religious or historical in nature, this is a pretty serious handicap. Pi is special: It occurs repeatedly throughout geometry, but also, says Ron Hipschman, a scientist at the Exploratorium, "anytime you have cycles, frequencies, or anything that’s rotating. It’s in tons of different places." Pi has been calculated to 10 trillion digits, and counting. But still. In the end, it's 3.14, or thereabouts.
Capitalize on serendipity.
Pi Day has a few things going for it. For one, it happens to be Albert Einstein's birthday. That's a nice coincidence, although it hasn't really paid off, other than giving a boost to Pi Day celebrations in Princeton, New Jersey, Einstein's longtime home.
More important: Pi sounds like pie. That's awesome. Plus, pie is circular, and pi is all about circles. Americans may not like math much, but pie? Absolutely.
The Exploratorium serves free pie on Pi Day--1,500 slices last year--but they're not the only ones. The American Pie Council has gotten into the act, publishing a Pi Day pamphlet with both math problems and recipes. Some bakeries and pizza shops are offering pies for $3.14, or pies that can be eaten in three-and-a-bit bites.
Make it family-friendly.
Obviously, there are rules, both legal and ethical, that restrict marketing to children. That's how it should be. But if there's something about your idea that can appeal to the entire family, not just to adults, go for it. If your idea has any redeeming value whatsoever, and kids are excited about it, the parents will be excited just to see their kids excited.
It's easy to dismiss the Exploratorium's Pi Day celebration as silly. A Pi Procession begins on 3/14 at 1:59. Everyone carries a single digit of pi, parades to music written to pi, and ends up at the museum's Pi Shrine, which they circle--you guessed it--3.14 times. Then they sing happy birthday to Albert Einstein. There is pi-lish (a form of constrained writing designed to help with the memorization of pi) and piku (Haiku written in honor of pi).
Keep laughing. No one at the Exploratorium minds, I guarantee you. Last year, they demonstrated the concept of pi with a big diagram of a pizza and let kids throw their own pi(e) crusts. Most parents had probably never seen their kids have this much fun with math, ever.
And people get way, way into it. Are you looking for evangelists for your company? The super-users? Pi Day's done it. "People show up in their favorite pi T-shirts," says Lori Lambertson, who works in the Exploratorium's teacher institute. "One woman made a skirt with pi symbols all over it. There's a couple that comes almost every year who had a baby named Pi five years ago. They'd bring baby Pi."
Who knows what they'll do next year, when the date will read 3/14/15--the first five digits of pi.
Also: Admission to the Exploratorium is free on Pi Day.
Embrace the competition.
All this fuss about pi has, not surprisingly, brought attention to those who think that a different number--tau--should get more of the spotlight. Tau is two times pi, but really, it's more accurate to say pi is half-tau, says Michael Hartl, a former physics instructor with Caltech, creator of the Ruby on Rails Tutorial, author of "The Tau Manifesto," and co-founder of a self-publishing platform called Softcover. "Because it involves dividing by the diameter, pi isn't the most natural choice for the circle constant," Hartl says. "It's just that it's easier to measure the diameter than the radius, but a circle is defined by its radius." Hartl says he celebrates Pi Day "ironically, as Half-Tau Day."
Hipschman is non-plussed, saying the Exploratorium used to celebrate 2Pi Day (June 28) and even 3Pi Day (September 42, or, in other words, October 12). "We invite Michael to come to Pi Day if he wishes," says Hipschman. "We'll even celebrate 2Pi with him. How's that?"
And don't forget the pie.
No discussion of Pi Day would be complete without a pie recipe. Barry Schuler, a much more knowledgeable cook than I, and managing director at venture fund DFJ Growth, recommends this version of tarte tatin. Tarte tatin may not technically be pie, but if you divide its circumference by its diameter you'll still get about 3.14. That's good enough for me.
Thank you, Barry, and happy eating.