Business

tough gristle

A friend of mine informed me that Belmont Butchery's Tanya Cauthen is suing Sausage Craft, the nascent wholesale sausage company started by former employees Chris Mattera and Brad Hemp. While the Style Weekly article and Mattera suggest this is about the sausage itself, Cauthen intimated that the wholesale sausage business was the cause for concern. I don't know the main parties here on a personal level, and I don't think I could expect Tanya to discuss this during business hours with a semi-regular customer like myself, but I do have some lingering questions about the whole situation, because this whole thing leaves a bitter taste in my Richmond-food-scene-loving mouth...

1. What IS the suit really about? Is it the recipes? The wholesale sausage concept/business model?
2. Did Mattera and Hemp actually plan and start executing on this idea while Cauthen was away?
3. Is Sausage Craft actually an idea stolen from Cauthen? That is, was it a firm plan in motion (about which at least Mattera or Hemp was aware) that Sausage Craft preempted? Did Mattera and Hemp work with Cauthen on the idea under false pretenses?
4. Most important, I think...Was there any kind of non-compete contract?

Without a contract I don't think there's much support for this suit because, regardless of the ethics behind the formation of Sausage Craft, this is a lot closer to a carpenter saying he's going to start building cabinetry, and his partner parts ways to start a cabinet business first. Making and selling sausage is trade craft, not trade secrets, and the concept of wholesale commerce is older than the city of Richmond. If Mattera and Hemp did anything sneaky (and I don't know enough to say whether they did or not) than it sure dues suck, but I just don't see grounds for legal action.

Now I like Chris and Brad and Tanya, and I like their work a lot. I always liked chatting with the guys when they were still at Belmont, and I still like chatting with Tanya when I go in there. I've always felt like, for a layman like myself, they were able to assist and inform me when I needed help or suggestions. I don't really want to take sides here, but I'm honestly kind of miffed that this lawsuit even exists.

Why not simply try to compete instead? Belmont Butchery is already well-established. Wouldn't they, then, have an advantage over Sausage Craft if they wanted to move into the wholesale business? They have an existing reputation on which to trade and existing facilities to get started. That, at least, could have been a head start over Sausage Craft. But Sausage Craft is making deliveries today and Belmont, to my knowledge, doesn't yet have a wholesale operation. I say just let the market and consumers decide this one. I buy sausage from both outfits, and I buy plenty of other products from Belmont Butchery that Sausage Craft never intends to sell. Perhaps we'll find that Richmond has plenty of room for both companies.

one year down

Ah, the sweet relief of finishing.

Last night was my last class meeting for the summer session of my MBA program. I was fortunate enough to be exempt from the final exam, so for the next two weeks I have no classes to attend and plenty of time to shoot some pictures before the fall semester starts up. I still have to work, but a scaled back daily schedule that doesn't include homework will be quite nice. So that's a full year under my belt, and a bit less than two remaining. May 2012 is the target, and it's near-tangibly closer.

On a related note, I spoke with the business IT professor last night about her potentially sponsoring an independent study I have in mind. I'm hoping to do some research into IT companies that have achieved stability and financial success without the use of venture funding, inspired largely by the "Bootstrapped, Profitable, & Proud" series from 37signals (yeah, I did just recently mention that - but this has been simmering in my mind for a few months). If I can put together a solid proposal (and the professor seemed mostly convinced already), I'll be able to take - for credit - what amounts to a customized course that supports my desired career path. Sweet!

A New Age of Entrepreneurial Fundraising

Small businesses and entrepreneurs hold a special place in my heart. I believe small businesses contribute greatly to our economy in mostly localized ways. Entrepreneurs are those daring individuals who turn their ideas into businesses, often innovating along the way. There's a great deal of overlap between the two groups, of course.

My idealistic goal for my business education is to find a way to help small tech businesses and entrepreneurs succeed - to achieve and maintain profitability without sacrificing their ideas or what drew them into running a small business in the first place. This means I'm wary of the popular venture funding model where often cannibalistic firms trade large sums of money for sizable equity stakes and influence; where ROI and an exit strategy are more important than nurturing the idea that attracted the financing.

So I've always been encouraged and impressed by 37signals, a firm that achieved stable profitability, growth on its own terms, and complete ownership of its operation. The company has since accepted funding from Jeff Bezos of Amazon.com, but not before already establishing itself as a healthy player in the marketplace. 37signals believes in the path it took to success, so they have an entire series of posts on their blog about other firms that built themselves up without venture funding. "Bootstrapped, Profitable, & Proud" shines a light on other firms that have over $1 million in revenue, accepted no venture capital, and are profitable.

Not everybody with an idea has the money to start working on their great idea right now, however, so some source of funding is still required. You only need a computer to start your own software development business (and most Americans have computers now). But not everyone has the equipment lying around to start hand-making high quality photographic prints, for example. That's where Kickstarter comes in. Kickstarter allows users to create fundraising projects. You set a financial goal to be paid out in an all-or-nothing basis. If you hit or exceed your target, you keep what you raise. If you miss it, even if it's by a dollar, none of the contributors pays. This method has been used to fund albums, films, and even hosting for Whiskerino. Fundraisers seek money in different tiers and typically offer some reward in exchange for pledges.

With that in mind, I absolutely enjoyed reading Craig Mod's essay on using Kickstarter to feed his entrepreneurial appetite (via Daring Fireball). Craig emphasizes the use of Kickstarter as seed money for a direction rather than a single project. That is, contributors often believe in the work of a fundraiser, not necessarily limited to one project. So why not use the fundraising power of Kickstarter to get your business off the ground? This is already happening, of course. Kickstarter has projects open for starting a food cart, a community biotech lab, and a college media website. Sure you can raise money to prepare for a photo gallery exhibition, but why not try raising money to launch a photography business?

Kickstarter has only been around for a bit more than a year, so I'll be interested to observe the limits and heretofore unimagined uses of its fundraising capabilities. Here's hoping Craig's Kickstarter tips find a broad audience and his essay/results encourage many would-be entrepreneurs to take the next step in making their ideas into realities.

Buz and Ned's coming to the West End

I work out in Richmond's West End, pretty close to where Parham Road intersects West Broad Street. Everyday I pass by what was, until recently, a Fuddrucker's burger joint. It's been closed for a while now, and I've been wondering what, if anything, would fill the empty building. Considering the trend of businesses moving further west toward Short Pump and leaving empty space behind, I was happy to see a construction trailer in the parking lot over the weekend.

This morning, however, I was thrilled to discover that not only will that space be occupied, but it's being taken over by one of my favorite Richmond food purveyors: Buz and Ned's Real Barbecue.

Here's how I connected the dots:
1. I searched for Fuddrucker's on Google Maps so I could get the street address.

2. Then I ran another search just using that street address, and a surprising link showed up under "Selected businesses at this address" in the sidebar: "Buz &Ned's Real Barbeque." I was immediately excited, but then a little confused because the spelling was off. Was it a mistake (on Buz and Ned's website it's spelled "barbecue")? I needed additional confirmation.

3. I searched around on Richmond Good Life's excellent (if a little over-crowded) website to see whether any recent stories talked about Buz and Ned's expanding into the West End, and I found a December 2009 article from Richmond Magazine. The article isn't specific about a location, but it's interview with Bruce "Buz" Grossberg indicates that he "arranged financing for a new place in western Henrico County and plans to close on the property by the end of January." Well it seems that closing happened, and things are moving forward because:

4. I ran a search through Henrico County's system for Plans of Development and found a case indicating that Buz and Ned's application for "Transfer of Approval" was received on April 14th of this year, and approved on May 26th, last week. The most recent update to the case was today, by Lee Pambid of the Planning Commission indicating the approval and sending of the approval letter. According to Article VI of The Rules and Regulations of the County Planning Commission for Henrico County, "Approval(s) of plan(s) of development are granted only to the owner-applicant(s) listed on the application. Subsequent owner(s) must request that the Commission transfer approval(s) to them." So this approval essentially transfers development rights from Fuddrucker's to Buz and Ned's.

I'm not really sure when it's supposed to open - and I'd be happy for anybody to fill me in - but since I drive by every morning and afternoon I'll be on the lookout as the situation progresses. It sure will be nice to have some of my favorite 'cue out by my office.

mobile phone-puters

A few times a semester I write for the Robins School of Business MBA Blog. I try to focus on the intersection of technology and business since that's my background, and I had a few thoughts about those little portable computers we carry with us every day:

With the advent of powerful mobile operating systems such as Google’s Android, Apple’s iPhone OS, Palm’s WebOS, and Microsoft’s forthcoming Windows Phone 7, you can say that your mobile phone does everything on this list as well. Oh yeah, and all of these devices let you make and receive phone calls, too.


Forgive the long setup to get to the point. I hope it's at least food for thought.

In the Trenches

UPDATE, 2019-stylez:

Wow. Something something hindsight, amiright? I don’t think most folks here in two-zero-nineteen would think Bezos cares much of anything for his employees. More than likely, the business reasons I hypothesize were “how can I extract maximum work from this husk of a human being, and what can I automate away from them?”

I'm already a huge fan of Amazon.com but Silicon Alley Insider's short piece on Amazon's CEO, Jeff Bezos, spending a week working in a warehouse with hourly employees made me even more comfortable with the business I give the online mega-store.

I'm sure there are significant business reasons behind the move, but I imagine it will have the added benefit of boosting morale. It's not often that we hear of executives directly participating in the low-level labor of their enterprises.

Corporate Neologizing

Few things drive me crazier than companies making up their own stupid buzzwords. Are they trying to come with catchy terms that they hope will provide free advertising as they theoretically worm their way into colloquial language? Regardless of intent, here is a short list of made-up words/phrases born out of ill-conceived advertising programs:

Fourth Meal
Threeconomics
Nougatocity (or any of Snickers' terrible terms)
Comcastic
People Ready

You get the point. If you have any others you've seen/heard in any form of advertising, put it in the comments.

Brain Fry

Holy schlemiel, my skull is simmering. I'm simultaneously getting over a cold, getting back in to work from vacation, and getting in my final studying for the GMAT this Saturday. If I can survive beyond this week I ought to be in much better mental shape for a while...until I have to start writing admissions essays and all that junk.

Here goes nothing...

So tonight I'm planning to attend an information session about VCU's MBA program. I'm hoping to learn more details, particularly, about the part-time option. Afterward I intend to pick up a study guide for the GMAT, and we'll see what happens...

When Industry Outsiders Break In

Today John Gruber linked up a Wired article about the Red video camera. I agree with his observation:

The most amazing part is that the core technology didn’t come from a company like Canon or Sony — Red created it themselves.


I think it extends further than the sensor itself. The notion that a guy who sold handlebar grips and sunglasses would go on to create a camera which has Hollywood heavies salivating is incredible. So I figured I'd explore similar situations where entrepreneurs or players in other lines of business break into established or unrelated industries.

Consider, first, the automobile industry. The established competitors spent plenty of money, time, and effort passing off concept electric vehicles citing nebulous timelines for when we could expect to see such cars on the road. Along comes a pair of engineers with the help of some Silicon Valley investment to create the Tesla Roadster. Here we have an all electric car in production. Pricey, yes, but it's only the first model, and more designs are on the way. They sold out of the entire batch of their first production run in advance and have a waiting list.

There is also the now familiar story of Apple's iPhone and the rest of the cellular industry. Industry giants scoffed at the newcomer (well, new to this market, at least) at first. Now with around 12 million handsets in the wild and apparently 45 million more to be produced through August 2009, we see every major handset manufacturer aping at least the full-touch-screen concept, and at worst design cues as well.

It's interesting to see how certain industries become insular after long periods of a few dominant players. I'm always impressed and encouraged when outsiders bring fresh thinking to these arenas challenging conventional business practices. Sometimes they make waves, and sometimes they turn entire sectors on their collective head.

Tootaloo, H2?

CNN Money has a story on GM's plans to close several truck plants and other dramatic changes as it continues to deal with the changing auto industry at a snail's pace. Such a piece would typically warrant little of my attention, except for this: "Wagoner also said GM is looking at possibly selling its Hummer unit as part of a strategic review of the SUV brand based on military vehicles."

Maybe they can sell it to a military contractor and call it a day. I won't cry at the loss of such an egregious symbol of consumption and hubris on our roads.

Dorkin' Donuts

There's a story making the rounds on the Interwebs about Dunkin' Donuts pulling an ad in which Rachel Ray wears a patterned scarf. This scarf caused a furor because it apparently resembles an Arabic keffiyeh - a detail which enraged talking heads who are so xenophobically knee-jerk in their responses that they're practically kicking themselves in the face over this. Besides the corporate idiocy of Dunkin' Donuts' response, I'm pretty pissed that none of the apoplectic objectors bothered to look into what a keffiyeh actually is. But I guess that would require caring about people who don't look and dress like they do...

For the curious, the keffiyeh is cloth (plain or patterned) used by Arabic peoples to shield their heads from the sun. While it has become associated closely with prominent antagonistic Arabic figures, it's origins and meaning are no more harmful than a t-shirt.

So terrorists often wear sandals. Am I gonna draw angry stares from people here in the US because I sport a pair of flip flops? Puh-lease.

Text Me Never

The Nilson Report is a publication for they payment systems industry, and in the February 2008 issue they indicate that banks intend to start using SMS to communicate with their customers. One of the primary reasons cited is the reading rate of text messages vs. email: 94% and about 50%, respectively.

Do you want to know why 94% of text messages are read? BECAUSE WE DON'T YET RECEIVE CRAP FROM BANKS OR OTHER BUSINESSES. I bet that 6% of text messages going unread are the free ones delivered from the cell phone providers indicating the addition of a few new towers. What useful communication do financial institutions hope to deliver in 160 characters or less, anyway? "You have overdrawn. You are now in the hole an additional $50. Standard texting rates apply to this message."

I'm sure some marketing "geniuses" were sitting in a room on the 32nd floor in Midtown Manhattan saying, "Hey! You know what all the kids use to talk to each other these days? Text Messages! There's a channel we're not already flooding with useless information!"