Adventures in Entrepreneurship with Jeremy Hanks

Inc 500 Conference – Clinton, Principal Group, Announcements

I’m going to start with a LONG post summarizing some things from the conference. (hey, print it off and read it on your next airplane ride or leave it on the back of the toilet and read it during other downtime activities) Five of the sessions were AMAZING, and I’ll do a separate post on each of them. When all was said and done, this was the best business conference I’ve ever been to. (Except for the B-52’s at the awards ceremony and gala. Those guys suck, probably the most annoying sound in the world those 2 ladies screaming and that dude talksinging. Come on man. I wanted to yell out: Play some Skynyrd, man! Or at least bring in someone good, like AC/DC or Def Leppard or Van Halen. Shoot, I’d even take Paris Hilton or some other poser celebrity rock star over the B-52’s.) Anyway, the focus on entrepreneurship, being among peers and like-thinkers, and amazing presenters/sessions all came together very nicely. Inc. did a great job.

I mentioned in my post from last week that former President Bill Clinton was going to speak. I liked President Clinton’s remarks and thought it was very cool that he came to the conference. He addressed the audience on 4 main points. First off, he referenced his talk from last year’s Inc. 500 conference where he really emphasized that the solution to climate change and to sustainability can be solved by capitalism and by entrepreneurs. On top of this, he decried (called them full of Hog Wash actually) those who espouse the idea that making changes to facilitate a less harmful human impact on the environment will hurt the economy. I wholeheartedly agree with him on this point. Sustainability is a MASSIVE problem. Entrepreneurs through capitalism can solve MASSIVE problems. And when they do, they create jobs, they grow economies, they increase standards of living. He also announced a new program being launched by the Clinton Foundation and Inc. called the Inner City Entrepreneur Initiative. They’ve tested it in New York with 9 business (7 of which are smashing successes) and are now rolling it out to 10 major cities in the U.S. to help inner-city entrepreneurs. The conference featured several of these 7 success stories. The program sounds very cool. As he closed his remarks, he said entrepreneurs need to help with 2 additional problems: the un-banked in America and health care. He touched briefly on the problem with the sub-prime loan implosion, and the related issue that 25 million Americans don’t have access to financial services through traditional banks. They can pay 50%-300% a year for services that most of us wouldn’t consider paying a penny for. (IMHO, check cashing services and payday loan companies are just slightly lower on my dislike scale than MLMs.) And then on to healthcare. What a mess. The U.S. is not even in the top 25 of countries for healthy citizens. He said that in the worst case scenario, if you took any other wealthy country’s healthcare system and implemented it in the U.S., we would see some very astounding results. We’d save $700B a year, equal to the entire U.S. trade deficit. We’d have 100% insurance coverage where currently 18% of citizens have no coverage– he called that unconscionable. We’d have at least the same level of care, if not better. Even with a different system that could do a better job, the core problem in the U.S. according to President Clinton is that we need a culture change because we are becoming Inc.reasingly unhealthy. For the first time in recorded history, the wealthiest country in the world is not the tallest country in the world. Companies can and need to find ways to help with wellness programs and $ Inc.entives to help get us all healthier. Again, what a mess.

That’s a great segue for another piece of the conference. I had the opportunity to participate in a focus group that the one of Inc. 500’s major sponsors Principal Group conducted concerning benefits for employees. I learned A LOT from this, probably more than Principal did. There were about 16 CEO’s in the room from companies all over the country in all different industries. All of us had around 100 employees. One of the main themes we discussed for the hour we were there was how the health care system is broken and how all of us can’t keep having 20% rate increases every year and survive. One of the CEO’s said his rate change last year was over 30%, I felt a TINY bit better with Doba’s rate change when I heard that. Let me put it bluntly: The health care system in America (and our culture that is driving massive increases in cost) is screwed six ways from Sunday. It’s going to break. When I look at Doba and the rate increases we’ve seen in the past 5 years, I predict it’s going to break within 5-7 years. We can’t keep absorbing these costs. This year was the first year that we had to change our plan to keep the rates lower. Next year I know we will do it again. We lasted 4 years with no reductions in insurance, but we can’t do that any longer. We’ll have to increase deductibles, office visit co-pays, etc. And in the end, even with these changes, we’ll pay 10-15% more. So we’ll have to start passing those costs to employees. The other main theme in that room was that all of us, as business owners, felt that most of the time employees don’t fully appreciate the value of and the financial load companies incur related to benefits (I got several ideas that we’re going to implement at Doba about this very thing). I brought up the point that I felt that the core benefits (IRA/401k, medical, vision, dental, life insurance, disability, incentive equity, PTO, etc.) actually have turned into an expected commodity. As long as they work, employees don’t care if you have a Fidelity 401k or a Principal 401k. They don’t care of you have IHC or Blue Cross. I’m really glad that I feel that Doba is providing the best quality benefit grain that you can find in any grain silos around. I also brought up that these core benefits can actually become a liability, because you can’t continually increase these benefits for your employees. Case in point is with medical insurance. Next Aug, my medical insurance benefit will actually be a negative for me. I’ll have to manage the disappointment of all my employees. Several people talked about how perks have become more of a focus to keep employees jazzed. Paying for cell phones, gym memberships, etc. We do that at Doba in the form of the Doba Truck, movie nights, Wednesday breakfasts, waffle days, company parties, etc. But the trick again with these things is that they can become expected and in the end taken for granted. That’s just human nature. Something cool comes along and it’s new and great. After a while, it’s the new standard, yet another thing to keep entrepreneurs busy thinking up new ideas–as if we weren’t already busy enough. All of these discussions were especially good for me to hear because it made me realize that one of the most important lessons I took from the conference is that everyone is feeling the same business/entrepreneurship pains. It’s comforting to know that I can go to my peers to get ideas and to share ideas on how to help solve these problems.

Finally, there were 2 main product announcements. American Express announced a new card based on the idea of giving all small businesses the opportunity to get trade terms. It’s called the Plum Card and it basically gives you 2-10-net 60 terms. They offer a 2% discount if you pay the balance within 10 days or you can extend your payment up to 60 days. I’ll have to look more into it and compare it to our current Amex corp card, but my first reaction is that it’s hard to tell how good a deal this really is. They’re launching it to 10,000 businesses to start, and everyone on the Inc. 500 list is guaranteed a card. They tried to bribe us a bit too by giving us all 4GB iPhones related to the Plum Card. Maybe the Plum Card will really be a great thing for small companies to help them manage their cash flow. I bet if they give everyone that uses the card iPhones, they’ll for sure penetrate the market. The other main announcement was that Inc. magazine launched IncBizNet.com (here’s where you can see the preview site). It’s a social networking site focused on companies rather than individuals. They want to have highly detailed profiles of businesses and develop the most comprehensive B2B directory in the nation. They compared it to Hoovers and D&B except the companies are in control. You can use a built-in biz wire to issue press releases, they support a free blogging network, you can be members of different groups (Inc. 500 and Inc. 5000 honorees are sub-groups already setup), and you have complete control over your profile. They built it entirely with open source code and the Beta launch is for the Inc. 500 and Inc. 5000 honorees with a public launch in October. I think it’s a great concept with some really great features, and if anyone can make it work and be valuable, Inc. can. I’ll give it a whirl by updating the currently very light Doba profile and seeing what happens with it.

Whew!!! Done with this one. Amazing how much you can get done on a plane with your MacBook Pro and your Bose Noise Cancelling Headphones and some great music (Buck Cherry, Linkin Park, Royal Bliss for this round). More to come from the Inc. 500 Conference and Awards Ceremony…

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