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10 Best States for Starting a Business

10 Best States for Starting a Business

To encourage residents to start their own businesses, U.S. states are investing in entrepreneur mentorship programs and pumping up their high-tech workforce.

Maryland, Colorado and Virginia are the three states most supportive of innovation, according to the fourth annual Enterprising States report out this week from the U.S. Chamber of Commerce, a Washington, D.C., based business advocacy organization.

The study measured five aspects of policy including exports and international trade, entrepreneurship and innovation, business climate, talent pipeline, and infrastructure. U.S. states were ranked for their performance in each category. Also, the study measured and ranked overall economic climate and growth in each state. Utah earned the title as the top performing state overall for fostering business growth and creating jobs. It ranked in the top 10 of every policy ranking and came in third overall in economic performance.

As part of the report, the Chamber of Commerce prepared an interactive map where you can click on any state to see how it stacks up in each category and why.

Here are the top 10 states ranked for entrepreneurship and innovation, as measured by the number of high-tech businesses in the state, programs that support entrepreneurs, and STEM (science, technology, engineering and mathematics) job concentration. Each state that made the list has something unique to offer resident entrepreneurs.

  1. MarylandThe Maryland Entrepreneurs Resource List is a networking tool for connecting experienced tech executives with young startup entrepreneurs. The University of Maryland Baltimore County’s ACTiVATE initiative, supported by the state’s Technology Development Corporation, gives female entrepreneurs over a year of support and guidance as they launch their tech startups.
  2. Colorado: In addition to attracting hikers and bikers, the Western state is a hotbed for high-tech businesses and ranks fourth in the country for the number of new businesses born. Also, it has a relatively high concentration of STEM jobs and in the last two years has bolstered its high-tech workforce with an additional 1,100 software programmers, 840 engineers, and 675 science research jobs.
  3. Virginia: In addition to having the highest concentration of STEM jobs of any state in the U.S., Virginia has been home to the Center for Innovative Technology since 1985. The CIT’s mission is to promote technology-based economic growth in the state and is focused on getting money to more entrepreneurs in the very early, seed round of funding.
  4. UtahThe Utah Science, Technology, and Research initiative (USTAR) at the University of Utah, which is dedicated to turning research at the state’s universities into commercial businesses, received $6 million in funding in 2012. Also, the state and the Governor’s office teamed up with Weber State University to offer entrepreneurs courses, mentorship and affordable working space in a program called Startup Ogden.
  5. Massachusetts: The New England state, home to some of the most prestigious research institutes in the country, including Harvard University and Massachusetts Institute of Technology, is a hub for STEM jobs. Also, in 2012, the state legislature passed a bill that will allow the Massachusetts to invest in several long-term research and development activities, provide $1 million for paid internships in startups, and another $1 million for a program to mentor entrepreneurs about how and when to access venture capital funding.
  6. Texas: The Lone Star State has more than 2.2 million small-businesses accounting for more than half of its private sector jobs. Also, since 2009, Texas has ramped up its STEM workforce by 34,000, primarily in the computer and IT fields.
  7. WashingtonImpact Washington supports manufacturing in the state and has a specific program targeting small manufacturers. Also, manufacturers can get access to funding through the state’s Washington Economic Development Finance Authority’s Industrial Revenue Bond program. In addition to its support for manufacturing, the home state of software giant Microsoft has a high percentage of STEM workers, with notable concentrations in engineering, science and computer workers.
  8. Arizona: The Southwestern state hosts the Arizona Innovation Challenge each year where it gives out $3 million in awards to entrepreneurs. Also, the state encourages investment in small Arizona businesses by granting tax credits through its Angel Investment Program, which it has budgeted $20 million for through 2016. Also, Arizona has a Fast Grant program giving winning entrepreneurs funding to use to hire expert consultants and test new products. The goal of the program is to help startups transform an innovative new product or idea into a money-making venture.
  9. Georgia: Atlanta is relatively active city for venture capital, with 54 startups getting money in 2012, according to the National Venture Capital Association, the venture-capital industry association. The capital city’s co-working space, The Atlanta Tech Village, has a waiting list of more than 100 people, a sign of the city’s active startup culture. Also, the Georgia Department of Economic Development runs a training program called Entrepreneur-Friendly Communities where it teaches local communities how to encourage and foster small-business growth.
  10. Florida: While Florida doesn’t have much to brag about when it comes to encouraging innovation, the Sunshine State has the highest business birth rate in the U.S., helping it to narrowly secure a spot on the entrepreneurship list. Also, the state has a very high growth rate of self-employed individuals, including the addition of 59,000 personal finance advisors since 2002, 39,000 property managers, and 38,000 securities and financial services individuals.

The U.S. Chamber of Commerce’s report is released in conjunction with the Chamber’s Small Business Summit, happening in Washington, D.C., this week, and was prepared by the economic-research firm Praxis Strategy Group.

Six Mistakes Entrepreneurs Make When Seeking Venture Capital

Six Mistakes Entrepreneurs Make When Seeking Venture Capital

Pitching venture-capital investors to launch or grow your business is a delicate process, so you need to tread carefully. There’s an art to making a successful pitch, says Aaron Levie, cofounder and CEO of Box, an online content-sharing company based in Palo Alto, Calif. He has raised $162 million in five rounds of funding and estimates he has pitched investors a few dozen times. “You should have a fully refined, bulletproof story,” Levie says.

Making an effective pitch is more important than ever, as venture capital remains relatively scarce. In 2007, venture-capital firms raised more than $31 billion to invest, according to data from Thomson Reuters and the National Venture Capital Association. But they raised only slightly more than $18 billion last year. “Our cottage industry is indeed getting smaller still and that will impact the startup ecosystem over time,” Mark Heesen, president of the association, said in a statement.

To take your best shot with venture capitalists, avoid these six common blunders:

1. Don’t contact every VC in Silicon Valley. Blindly reaching out to VCs with a generalized pitch is not going to improve your chances of getting funded, according to Brian O’Malley of Battery Ventures in Menlo Park, Calif. Not all investors are interested in the same kinds of companies, nor do they all invest the same amount of money or at the same time in a company’s life cycle.

Research the VC you plan to pitch, figuring out the kind of companies it has invested in and at what stage in a company’s growth. This basic, yet useful, information can often be found on the investor’s website. “If people don’t display the most basic sales characteristics, then I worry about their ability to be successful as an entrepreneur,” O’Malley says.

2. Don’t overdo the PowerPoint presentation. Some entrepreneurs create lengthy PowerPoints that leave investors bored and with little time for questions and answers. John Backus, founder and managing partner at New Atlantic Venture Partners in the Washington, D.C., area, recommends a maximum of 15 slides for a one-hour meeting. That number of slides will take up about half the meeting, he says, leaving 30 minutes for questions. Also, make the slides as visual as possible. “We are not going to remember a list of data,” Backus says.

3. Don’t disregard questions that come up. VCs will likely have questions that interrupt your presentation, and you may be tempted to hurry through them to get back to your rehearsed pitch. Instead, always answer questions as completely as possible. After all, if you secure funding with a VC, it’s likely going to be a long-term relationship – and communication is key. “When I invest in your company, we are going to be married for five to seven years,” says Johnathan Ebinger, investment partner of BlueRun Ventures in Menlo Park, Calif. Sometimes “it is like they are playing whack-a-mole with my questions,” he says. “Let’s try to have a conversation.”

4. Don’t exaggerate. While VCs are hunting for the next Google, Facebook or Twitter, they don’t want to hear unrealistic pitches. “There are probably five companies out there in the world that have gotten to $10 billion, $20 billion, $30 billion,” Backus says. “Be realistic and tell me how you are going to win.” One way to make your pitch credible: Identify your potential rivals and explain your competitive strategy. “There is always competition,” Ebinger says. “You have to be open to the fact that the world is going to get by without you.”

5. Don’t try to raise money just for the short term. O’Malley often hears entrepreneurs say they’re trying to raise cash to cover expenses for a period of time, usually 12 to 24 months. But he discourages short-term thinking. Instead, he urges entrepreneurs to raise money to hit milestones, such as reaching 500,000 downloads of your software or application, hiring a vice president of marketing or signing a distribution deal. Also, raising a bit more money than you’ll need is better than too little. “Of my seed investments I have made, half of them wished they had raised more money,” O’Malley says. “None of the others that raised more than they needed ever regretted it.”

6. Don’t rush to disclose what you think your company is worth. You will need to discuss how much money you are seeking, but don’t immediately share what percentage of your company’s value that represents. “I have talked to a lot of my venture friends, and it turns them off when they see the value of the company” declared too soon, says Lori Hoberman, chairwoman of law firm Chadbourne & Parke LLP’s emerging companies/venture capital practice in New York.

Instead of putting your estimated valuation in the presentation, allow it to come up naturally in conversation. The valuation will be “a very hotly negotiated point between you and the investor,” Hoberman says. The issue usually surfaces at the end of the first meeting, she adds, when you discuss what percentage of the company you are selling for the investment.

Small Business Health Care Stuck on Hold

Small Business Health Care Stuck on Hold

When it comes to health care, small-business owners aren’t making any fast moves.

Faced with higher premiums again in the year ahead, many business owners have found themselves in a holding pattern. They’re concerned about the rising costs and the possible impact of health reform, but unsure about making any changes until they have more clarity or options.

Mitch Goldstone, the president and CEO of ScanMyPhotos.com, a photo scanning service in Irvine, Calif., plans to continue paying 100 percent of his 19 employees’ costs for medical, dental and vision coverage, even though premiums are expected to jump 18 percent, or roughly $18,000, in 2012.

While he considered sharing the costs with his employees in 2012, he worried that some people would opt out, putting their own health at risk and raising the per-person cost of the company’s group plan. “I didn’t think that the usurious rates that the health insurance companies are charging should be punishing my employees,” Goldstone says.

Waiting to see
He and many other business owners are waiting to see what impact the Affordable Care Act will have on them. Nineteen percent of small employers say they are either “likely” or “very likely” to terminate plans after state insurance exchanges go online in 2014, according to a November survey by Mercer, a benefits consulting firm in New York. The insurance exchanges would offer uninsured consumers a choice of health plans with information about the costs and benefits of each option.

8 U.S. Presidents Who Started as Entrepreneurs

8 U.S. Presidents Who Started as Entrepreneurs

U.S. presidents sure like talking about the importance of small business to the country’s overall health. For instance, Barack Obama said, “I think Ronald Reagan tapped into [the fact that people wanted] a return to that sense of dynamism and entrepreneurship that had been missing.”

But, how many U.S. presidents have actually been in the trenches, running their own enterprises? Former Republican presidential candidate Mitt Romney made business experience the principal reason for his election in 2012, recently saying, “I’d like to have a provision in the Constitution, to say that the president has to spend at least three years working in business before he could become president of the United States.”

While the jury’s still out on whether business know-how makes for a better president, here’s a look at eight U.S. leaders who were hard-working entrepreneurs.

3 Companies That Are Making Politics Cool Again

3 Companies That Are Making Politics Cool Again

On occasion, we are reminded that politics can be cool–take, for example, MTV’s Rock the Vote campaign. But these days, cool is about more than the youth vote–it’s about technology. At this year’s South by Southwest (SXSW) conference, Al Gore and Sean Parker took to the stage to discuss how the internet is at long last having a quantifiable impact on the political process. Parker even referred to this year’s web-driven mass protests of the controversial SOPA and PIPA internet piracy acts as the “Nerd Spring.”

“Politics has lagged because it was all about door-knocking and handshaking, but lawn signs and bumper stickers won’t do it anymore,” says Lou Aronson, founder and CEO of Washington, D.C.-based mobile polling and social networking company Votifi. “And the sooner we start recognizing the power of data, the faster we can unlock our potential as a nation.” Here’s a look at what he and some fellow high-tech political junkies are up to.

 

Votifi
Digital Media
In the fall of 2008, presidential campaigns–and the accompanying robo-dials to land lines–were in full swing. Aronson, a lawyer and longtime political activist, realized that many mobile-savvy voters were avoiding those calls. Last year he launched Votifi, which uses a peer-to-peer network and surveys delivered via e-mail to raise political awareness by uniting people through issues they care about.

Problem: Believe it or not, nearly as many people cast votes for the American Idol finals in May as voted in the 2008 presidential election. How can social media and polling be used to get disenfranchised citizens–especially Millennials, Hispanics and African-Americans–engaged in politics?

Solution: Make it personal, and make it digital. Votifi users create online profiles by answering multiple-choice questions on issues ranging from food to foreign politics. They can then build out a network to discuss issues with like-minded voters–or debate those with opposing viewpoints. For campaigns and organizations, Votifi surveys offer a glimpse into users’ political identities over time, offering far greater detail than a simple split down party lines. The surveys can be answered through a browser or mobile app, which appeals to groups difficult to reach on land lines.

Early success: Votifi has sent out roughly 1.8 million e-mail surveys and gotten a 65 percent completion rate. (Old-school robo-dials had an average 3 percent response rate.) The company, which has 5,600 members, claimed a finalist spot at the 2012 SXSW accelerator competition and completed major research campaigns for organizations like the 2012 Charlotte Democratic Convention.

MindMixer
Community Forum
Tired of planning public local-government meetings attended solely by NIMBY windbags, Nick Bowden parlayed his experience as an urban-planning consultant into MindMixer, an incentivized online platform that aims to increase engagement in local and city politics.

Problem: Civic leaders do not engage effectively with young voters, who demonstrate little interest in local issues. Community-minded citizens face bureaucracy and delays when attempting to deal with local governments.

 

Solution: Focus on the people. MindMixer is a convenient forum for citizens to contribute ideas about what they want and need in their communities. Users sign up–crucially, with their real names–pick personal interests and locations, then can raise issues on the forum or respond to posts by elected officials, city departments and school districts. The best ideas earn points when they are “seconded”; these can be redeemed for prizes like lunch with the mayor of San Francisco or a birthday party at the local fire station. Civic leaders and organizations, meanwhile, get inside information to make more informed decisions. Everybody wins.

In a typical scenario, an Omaha, Neb., citizen noticed that a crosswalk needed repainting. Rather than having to research which city department was responsible, submitting a request and hoping to get a response, he raised the issue on MindMixer. The post was pushed directly to the public works department, an employee followed up, and within two weeks the job was done.

Early success: In just 15 months, the 17-person company has landed $2.2 million in funding and more than 200 clients, including the city of Los Angeles and the Republican National Committee.

Making Apps for Political Junkies

Making Apps for Political Junkies

The 2012 Presidential election is the first one where people are tethered to their smartphones, and this fact hasn’t gone unnoticed by scores of app makers.

A quick search of Google Play for the word “politics” brings up at least 1,000 apps — most related to political news, election commentary and state-specific politics. The candidates themselves even have their own: Romney for President and Obama for America. Both apps, presumably, were developed by in-house engineers, though neither campaign returned requests for comments. (Romney also used an app to announce Paul Ryan as his running mate, though the rollout didn’t go quite as promised.)

Some entrepreneurs are developing “disposable” apps that are germane for the 2012 election season but may have little relevance later on. Others have more broad-based political apps, not tied exclusively to the presidential race, and hope the upcoming season will boost sales, recognition or user counts.

To be sure, political-app-building is still somewhat of a new market, and business models vary. Some entrepreneurs are creating free apps, hoping to make money from ad revenue down the road. Others are charging fees to download their app or levying ongoing subscription fees to some users. And still other small businesses are profiting by helping politically minded, but less tech-savvy individuals build and publish their own apps for cheaper than they could on their own. (The expense of doing it solo can be prohibitive, with costs ranging from $10,000 to $50,000 or more.)

Here’s a sampling of some political apps on the market, all made by independent shops. Some are so new they have few ratings on either iTunes or Google Play.

Politix — One of the newer apps, it was created as a forum for political chatter. It allows users to take a stand on issues and candidates central to the 2012 election, and then share those thoughts with their social networks, virtual and physical communities, and fellow voters. The free app was launched in early May for iPhones and certain iPads and iPods. Chris Tolles, chief executive of Topix, the Palo Alto, Calif., company that developed the app, hopes to eventually make money through advertising. He says the app was developed to meet user demand for a political forum. “There seemed to be a huge hole in the market,” he says.

Filibustr — This free app, available on Apple devices since May, allows users to find congressional lawmakers across the U.S. and view information about their voting records and positions on important issues. Users can also debate issues and throw a virtual tomato, tip their hat, wag a finger or give a bouquet of flowers in response to candidates’ actions. Reneldy Senat, who volunteered for the 2008 Obama presidential campaign, came up with the idea after an interaction with then-candidate Obama. He declined to disclose the number of current users or plans for making money, but said the app attracted thousands of users in its first few weeks.

Parity Politics — This app, available for Android devices since July 2011, displays real-time election polls and graphs related to the race for president and Congress, as well as approval ratings for certain officeholders. It’s also got data, news, editorials, and articles from across the political spectrum, including original content. It costs 99 cents and has a 3.3 star rating on Google Play. “I wanted [poll] information daily and no app could do that, so I built it for myself,” says developer Erhan Kartaltepe. There’s also a free, watered-down version of the app. But that one only has a rating of 2.1 on Google Play.

7 Situations When You Need a Financial Advisor Most

7 Situations When You Need a Financial Advisor Most

Do you know enough about financial management to take care of all of your investing on your own? Or do you need help from a seasoned expert?

That question comes up for millions of Americans each year.

If any of these describe you, you could benefit from professional financial advice:

1. You’re retiring soon – Maximizing retirement income requires smart decisions around complex topics such as Social Security, 401(k) and IRA withdrawals.

2. You manage your own investments – Individual investors should check their strategies with unbiased third parties. You may be overlooking opportunities in your portfolio.

3. You have children – Whether you’re saving for college or planning their inheritance, there are several ways to ensure your children are taken care of.

4. You inherited money – Have you noticed lottery winners often declare bankruptcy? It can be difficult to manage sudden increases in wealth.

5. You have a financial advisor – Depending on how you chose your advisor, there may be a better one for you. Family referrals are convenient but don’t always produce results.

6. You’re divorcing – Untangling finances in a divorce can be messy. Impartial advice is key.

7. You want to build wealth – If you’re still decades from retirement, good decisions today can add thousands to your retirement accounts.

See Your 3 Financial Advisor Matches

Finding the right financial advisor that fits your needs doesn’t have to be hard. SmartAsset’s free tool matches you with top fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is legally bound to act in your best interests. If you’re ready to be matched with local advisors that will help you achieve your financial goals, get started now.

Freelancers! Transform Your Frustration Into Freedom

Freelancers! Transform Your Frustration Into Freedom

Do you feel like you’re sitting on a goldmine of talent, but can’t get others to recognize or pay you for it? Or perhaps you find yourself saying, “I feel like I missed something in school – I need a stronger network, but I don’t know how to build it!”

I can relate. Having started my own business as a freelance copywriter 24 1/2 years ago, I know what it’s like to get a business off the ground … get the word out to prospects … increase one’s visibility in the marketplace …

After receiving many phone calls and e-mails from frustrated freelancers and creative solopreneurs, I realized that a lot of business owners would like to figure out what I’ve been doing naturally for the last quarter of a century.

Therefore, I’d like to personally invite you to my upcoming complimentary teleseminar. Please join me on June 12th for “From Freelance to Freedom” as we explore:

  • My 6 secrets of how to stay in business 24+ years.
  • 3 ways to get out there & get noticed so clients can find YOU.
  • How to enjoy a consistent income so you’re not sweating from gig to gig – worrying about where the next project will come from.
  • One simple step you can take that leads to referrals and new business.
  • 5 pointers for identifying your ideal client – remember, they just don’t get to choose you, you get to choose them.
  • How to find clients from the comfort of your own home (you can do it with your PJs on). TIP: It’s something other than social media.
  • The best way to market and expose yourself to prospects – without a hard-core sales pitch.

 

How do you take your business as a freelancer or creative solopreneur to the next level? Sign up for the free telesminar today.

I look forward to “seeing” you on the call.

Have a question? Please share it below and I’ll do my best to answer it on the call. I’d love to hear from you. Thanks and here’s to your sweet success!

Defining Your Business Goals

Defining Your Business Goals

Setting goals is an integral part of choosing the business that’s right for you. After all, if your business doesn’t meet your personal goals, you probably won’t be happy waking up each morning and trying to make the business a success. Sooner or later, you’ll stop putting forth the effort needed to make the concept work. When setting goals, aim for the following qualities:

Specificity. You have a better chance of achieving a goal if it is specific. “Raising capital” isn’t a specific goal; “raising $10,000 by July 1” is.

Optimism. Be positive when you set your goals. “Being able to pay the bills” isn’t exactly an inspirational goal. “Achieving financial security” phrases your goal in a more positive manner, thus firing up your energy to attain it.

Realism. If you set a goal to earn $100,000 a month when you’ve never earned that much in a year, that goal is unrealistic. Begin with small steps, such as increasing your monthly income by 25 percent. Once your first goal is met, you can reach for larger ones.

Short and long term. Short-term goals are attainable in a period of weeks to a year. Long-term goals can be for five, 10 or even 20 years; they should be substantially greater than short-term goals but should still be realistic.

There are several factors to consider when setting goals:

Income. Many entrepreneurs go into business to achieve financial security. Consider how much money you want to make during your first year of operation and each year thereafter, up to five years.

Lifestyle. This includes areas such as travel, hours of work, investment of personal assets and geographic location. Are you willing to travel extensively or to move? How many hours are you willing to work? Which assets are you willing to risk?

Type of work. When setting goals for type of work, you need to determine whether you like working outdoors, in an office, with computers, on the phone, with lots of people, with children and so on.

Ego gratification. Face it: Many people go into business to satisfy their egos. Owning a business can be very ego-gratifying, especially if you’re in a business that’s considered glamorous or exciting. You need to decide how important ego gratification is to you and what business best fills that need.

The most important rule of self-evaluation and goal-setting is honesty. Going into business with your eyes wide open about your strengths and weaknesses, your likes and dislikes and your ultimate goals lets you confront the decisions you’ll face with greater confidence and a greater chance of success.

What Is a Sales Funnel? The Guide to Building an Automated Selling Machine.

What Is a Sales Funnel? The Guide to Building an Automated Selling Machine.

One of the core concepts in the digital marketing industry is the sales funnel. While odd sounding at first, this single core concept can take a business from virtually non-existent and unknown to multi-million-dollar marketing machine with mass saturation, seemingly overnight. In fact, there are skilled practitioners who have built a career around implementing this single concept in business.

If you’re wondering what a sales funnel is, simply imagine a real-world funnel. At the top of that funnel, some substance is poured in, which filters down towards one finite destination. In sales, something similar occurs. At the top, lots of visitors arrive who may enter your funnel. However, unlike the real-world funnel, not all who enter the sales funnel will reemerge out from the other end.

In marketing automation, Ryan Deiss, co-founder of Digital Marketer, often describes the sales funnel as a multi-step, multi-modality process that moves prospective browsers into buyers. It’s multi-stepped because lots must occur between the time that a prospect is aware enough to enter your funnel, to the time when they take action and successfully complete a purchase.

There are email warming sequences that include things like personalized value-driven stories, tutorials and even soft pushes to webinars, and of course product suggestions that happen over days or even weeks. The truth is that most prospects won’t buy from your website at first glance, especially if they’re only just becoming aware of you today. It takes time. Thus, the funnel is a multi-modality process, as there are a variety of relationship-building experiences and “touches” that occur through several stages.

Much of this is steeped in buyer psychology. The best marketers in the world know that there is a psychological process that must occur for prospects to whip out those credit cards and turn into buyers or even hyper-active buyers. One such person whose perfected this process is Russell Brunson, an “underground entrepreneur” who founded a company called ClickFunnels, a sales funnel SaaS business that empowers marketers from around the world to build marketing automation without all the hassle.

As a software engineer myself, I can tell you that building funnels from an application standpoint takes massive amounts of work. There’s a great deal of coding and integration that’s required here. From email systems to landing page implementations to credit card processing APIs, and everything in between, so many platforms need to “talk,” that it takes the bar too high for the average marketer.

However, what Brunson cleverly conceived with ClickFunnels is to create a SaaS that can integrate with the world’s most popular platforms and virtually anyone can quietly launch a funnel in hours as opposed to weeks of hefty coding and programming. As a fervent user of ClickFunnels myself, I can tell you that the system is impressive beyond measure.

 

Understanding sales funnels

To better understand the concept of a sales funnel and just how you can implement it in your own business, let’s look at the following image from Shutterstock. On the left side of the image, you see a magnet. That magnet is attracting customers, which happens a number of ways. From blogging to social media to paid ads and everything in between, how the visitors arrive to your website has some impact on the success of your funnel.

What are sales funnels?

Stage 1: Awareness

What’s more important about the sales funnel is what happens when those visitors (we can call them prospects) actually do arrive. Through a variety of means, many of which you’ve already seen, such as email newsletter signups, ebook downloads, online quizzes and more, those prospects enter into your sales funnel through an enticing offer.

The goal of your entire sale funnel and platform is to solve your customer’s problem. When you know the problem, and you build content to draw them in, then offer them a product or service to solve their problem, that’s when the real magic happens. However, getting to that stage takes work and you have to garner their awareness first.

Once the prospect is in the proverbial funnel, you’ve peaked their awareness. That’s the first stage of the funnel. However, getting a prospect aware of you is no simple feat. Depending upon how they’ve arrived to your website (organically or through a paid ad), those customers might view your funnel differently and your opt-in rates will vary significantly.

For example, when a customer finds you organically through a Google search for example, that means you have some element of authority. When you have authority, prospects are more likely to enter into your funnel because they know that if they found you relevantly, that whatever it is that you’re providing must be of a great value. That’s just the nature of SEO and organic search.

Of course, regardless of how they enter into your funnel, your goal as a marketer is to move them through the multiple stages that will take them from prospect to buyer. And once they’re aware of you, you need to build their interest. To do this, you need to establish a relationship with the customer. You might have enticed them with a great offer (lead magnet) to grab their email address, but actually moving them through the funnel is a far greater challenge.

The truth? People are smart. They’re not simply going to buy anything from anyone unless they feel there’s an immense amount of value to be had there. Thus, your funnel needs to built that value and bake it in through a variety of means. But most importantly, you have to create a strong bond with your prospect, and that happens by being relatable, honest and transparent in your email warming sequence.

 

Stage 2: Interest

You gain the prospects interest through an email sequence. You begin to relate stories to them that tie into who you are and how you’ve arrived to this point in your life. Brunson, in his book, Expert Secrets, calls this the Attractive Character. Are you the reluctant hero whose journey happened almost by mistake, but you feel like you owe it to yourself and the world to convey something of great value?

Or, are you a leader, an adventurer or an evangelist? How you position yourself is entirely up to you, but your message must be consistent throughout your entire “pitch” and it needs to be steeped in the truth. Your backstory, and just how you convey that through parables, character flaws and polarity, has much to do with just how well you can “hook” in your prospects to create a mass movement.

Of course, implementing this isn’t easy. You need to first develop your stories, then decide on how you’re going to convey those stories and at what drip-rate. For example, your first email or two might go out on the day they first signup, then one email per day might go out afterwards. How much of that will be story-based and how much will be pitches?

In a recent conversation I had with Perry Belcher, co-founder of Native Commerce Media, he told me that you also need to train your prospects to click on links. For example, you could have them click on a link of what interests them or link them to a blog post or eventually to a product or service that you’re selling, but you need to train them to build a habit of clicking on those links from the very beginning.

Stage 3: Decision

The next stage is the decision. Getting prospects to make a decision isn’t easy. The best way to get them there? Beyond the art of story telling, copywriting and building the habit of link-clicking, you need to have lots and lots of customer reviews and testimonials. This is one of the most powerful ways that you can get people to take action.

Of course, if you’re going the paid ad route, you could also use Facebook and Google re-targeting to keep that awareness and interest level high. For example, if you’ve ever noticed after leaving a particular website, that you begin to see their ad everywhere, there’s a particular reason for that. Especially if they’ve already entered your sales funnel, this is a very powerful way to get them to act.

For example, you could show them re-targeting ads that have video testimonials or reviews by other customers. If you have media publications that have written about you, you could take that opportunity to highlight those. When they see this in your sales funnel and you follow them around with re-targeting, it’s simply an added element of exposure.

But however you get them to decide to act, flipping that switch isn’t simple. You need to present them with a great opportunity and use Robert Cialdini’s 6 principles, outlined in his 1984 book, Influence, in one way or another to move them through this stage:

  • Principle of reciprocity — This is achieved by delivering lots of value, either through whatever it is that you provided them as a free offer (lead magnet) in the very beginning, or in an ongoing exchange through your emails.
  • Principle of commitment & consistency — When people commit to something, they’re far more likely to purchase from you. That’s why getting them to agree to something like a free + shipping offer or by agreeing with something you’ve said in some way. This is a powerful principle in sales and if you pay attention to some of the best marketers in the world, you’ll notice that they work fervently to get your commitment to something, even if it’s very small in the beginning.
  • Principle of liking — When people like you (i.e. they relate to your stories) they are more likely to purchase something from you. How well you craft your story and convey that to your prospects is going to play a big role in whether they decide to act or not.
  • Principle of authority — How much authority do your products or services have? Are their respected people in your community that have endorsed it? Scientific studies that are backing it? Are you yourself an authority? All these elements come into play in this process.
  • Principle of social proof — Do you have social proof? Are people on social media raving or talking about how great your products or services are? Do you have some other type of social proof? Best-selling books? Something else? It’s importnat that you present this to prospects if you do have them.
  • Principle of scarcity — How much scarcity have you baked into your email sequence? Again, people are smart, but when you apply the principle of scarcity, as in there are only a limited amount of some offer or time left before a discount expires or slots available for an online class, it entices people to take action.

Stage 4: Action

The final stage of the sales funnel is the action that you’re intending them to perform. In most cases this is the purchase. Again, how well you move them through the various stages is going to set you up with a specific conversion for this action. For example, if 100 people click on your offer and 10 people enter your sales funnel but only purchase people purchase, then you have a 2 percent conversion.

However, the best part about this, and the most powerful route that entrepreneurs take to scale their businesses, is that if you know that sending 100 people to your site costs you $200, for example, but you get two people to convert at $300 each, then you have a $600 return on $200 invested (300 percent). When you know that, that’s when the entire game changes and you can infinitely scale your offers.

This how the world’s smartest marketers scale out their businesses. They know the conversion value and they’ve tweaked and perfected their sales funnels, so they go after this with a vengeance by simply scaling out their offers. If you know that, by investing $1 you’re going to get $3 back, you will infinitely invest $1 repeatedly. Get the point?

However, getting to this stage is no simple feat. It takes an enormous amount of work and effort plus tracking. By implementing sales funnel software, such as the platform built by Brunson, you can definitely cut down the headache, but there’s still lots of work to be done. Copy needs to be written, tracking pixels need to be installed and email sequences need to be created. But that’s what it takes to succeed.

Think about that the next time you’re building out a sales funnel. This complex and intricate concept in business can literally take you from a complete unknown to a global powerhouse quickly through the art of scaling out a highly-converting offer. Don’t try to take shortcuts or implement hacks, and put in the time if you’re looking to eventually reap the benefits and results.

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