Pessimism leads to weakness, optimism to strength. William James

Businesses You Can Start For Under $5,000
Mary Crane, 12.04.06, Forbes Online

Eight years ago, Texas resident Cynthia Ivie, a 43-year-old sales rep for Newsweek, struck out for Chicago with no more than a business idea and a 1989 Toyota Corolla packed with clothes, books, a vacuum cleaner, a stereo and a cocker spaniel named Buckley. Ivie's big moneymaking idea: organizing the apartments and offices of busy people.

Today, Ivie's company, White Space, offers "clutter control" services to hundreds of clients across the country, many of them recently relocated by big companies like the Walt Disney Co. and Exelon. White Space now has five full-time and eight part-time employees; Ivie expects revenues to top $1 million in 2007. "I knew the business would take off if I could survive long enough," she says. "I had a lot of gumption--and probably a little naiveté that kept me going."
Gumption, naiveté and very little cash. Ivie couldn't afford a cellphone, so she bought a pager and a voicemail system for $200--"I knew where every pay phone in Chicago was," she claims--and scraped together another $1,000 for brochures and business cards. For six months, she slept on a futon mattress in her friend's basement. Eventually, she moved into her own home office, outfitted with two hand-me-down computers ($107) and two desks made out of hollow-core doors laid across cheap file cabinets ($20) from Office Depot. Total startup costs: around $1,500, including gas.

There are plenty of Ivies out there. And a lot them didn't have--or need--gobs of green to launch their businesses.

In Pictures: Nine Businesses You Can Start For Under $5,000
Indeed, there are myriad ways to preserve precious cash while starting and building a business. Our special report, called "Small Business On The Cheap," offers plenty of helpful tips--from slashing marketing costs and telecom bills to cutting health care bills and travel expenses.
Like Ivie, fledgling entrepreneurs can save a bundle by selling services rather than products. "It's really hard to start any product-based business for under $5,000," says Richard Stim, co-author of Whoops! I'm in Business: A Crash Course In Business Basics with Lisa Guerin. In general, he says, there is less overhead for service-based businesses, which don't require large outlays for equipment and inventory.

The best services to choose from are those that people don't want to do themselves. Think yard work or preparing legal documents. Educational services such as teaching yoga, ballroom dancing or how to take the SATs are attractive, too. Better, still, if you can help people avoid or solve a problem--say, by inspecting homes for water quality or environmental safety.
There are some startup costs, of course. But when it comes to service businesses, the nice thing is that many don't require expensive technology, save for maybe a computer and an Internet connection. If you want to start a child-care facility, for instance, you'll want to spend a few dollars on toys and perhaps some childproof locks.

In some cases, as with child-care providers or real estate agents, you may need a state license or other certifications to set up shop. Child-care licenses run up to $100, depending on the state; you'll also have to be certified in first aid and CPR (maybe $50 all in) and you'll need some liability insurance (say, $450 per year).

A service startup's biggest expense is probably marketing, be it printing brochures and business cards or placing ads in local newspapers. (Check out VistaPrint, which specializes in low-volume runs for smaller shops.) Setting up a blog can be a cheap way to get your message out, and it's a lot less expensive than maintaining a Web site.

The best--and cheapest--advertising, however, is word of mouth. Offering free initial consultation meetings is a good way to get people talking. When Ivie landed in Chicago, she sent postcards to 30 local business people, promising three hours of organization services for free. "People snapped it up, tried the services, liked them, referred me to other people and the business started to grow," she says.

In smaller markets, getting on friendly terms with the competition also can be good for business. If one piano teacher has too many students, she might sluice the spillover to you.
Whatever you do, though, remember to be patient. "If you're looking to get rich quick, forget about it," says Stim. "Instead, try to make a profit, enjoy what you're doing and make it something that can keep going and going."

Learning to Keep Learning
By THOMAS L. FRIEDMAN
New York Times 12/13/06
(This is why the IDEA Cafe http://ideacafe.meetup.com and Franklin Circles
www.JohnWren.com are important. John Wren)

I recently attended an Asia Society education seminar in Beijing, during which we heard Chinese educators talk about their “new national strategy.” It’s to make China an “innovation country” — with enough indigenous output to advance China “into the rank of innovation-oriented countries by 2020,” as Shang Yong, China’s vice minister of science and technology, put it.

I listened to this with mixed emotions. Part of me said: “Gosh, wouldn’t it be nice to have a government that was so focused on innovation — instead of one that is basically anti-science.” My other emotion was skepticism. Oh, you know the line: Great Britain dominated the 19th century, America dominated the 20th and now China is going to dominate the 21st. It’s game over.

Sorry, but I am not ready to cede the 21st century to China yet.

No question, China has been able to command an impressive effort to end illiteracy, greatly increasing its number of high school grads and new universities. But I still believe it is very hard to produce a culture of innovation in a country that censors Google — which for me is a proxy for curtailing people’s ability to imagine and try anything they want. You can command K-12 education. But you can’t command innovation. Rigor and competence, without freedom, will take China only so far. China will have to find a way to loosen up, without losing control, if it wants to be a truly innovative nation.

But while China can’t thrive without changing a lot more, neither can we. Ask yourself this: If the Iraq war had not dominated our politics, what would our last election have been about? It would have been about this question: Why should any employer anywhere in the world pay Americans to do highly skilled work — if other people, just as well educated, are available in less developed countries for half our wages?

If we can’t answer this question, in an age when more and more routine work can be digitized, automated or offshored, including white-collar work, “it is hard to see how, over time, we are going to be able to maintain our standard of living,” says Marc Tucker, who heads the National Center on Education and the Economy.

There is only one right answer to that question: In a globally integrated economy, our workers will get paid a premium only if they or their firms offer a uniquely innovative product or service, which demands a skilled and creative labor force to conceive, design, market and manufacture — and a labor force that is constantly able to keep learning. We can’t go on lagging other major economies in every math/science/reading test and every ranking of Internet penetration and think that we’re going to field a work force able to command premium wages. Freedom, without rigor and competence, will take us only so far.

Tomorrow, Mr. Tucker’s organization is coming out with a report titled “Tough Choices or Tough Times,” which proposes a radical overhaul of the U.S. education system, with one goal in mind: producing more workers — from the U.P.S. driver to the software engineer — who can think creatively.

“One thing we know about creativity is that it typically occurs when people who have mastered two or more quite different fields use the framework in one to think afresh about the other,” said Mr. Tucker. Thus, his report focuses on “how to make that kind of thinking integral to every level of education.”

That means, he adds, revamping an education system designed in the 1900s for people to do “routine work,” and refocusing it on producing people who can imagine things that have never been available before, who can create ingenious marketing and sales campaigns, write books, build furniture, make movies and design software “that will capture people’s imaginations and become indispensable for millions.”

That can’t be done without higher levels of reading, writing, speaking, math, science, literature and the arts. We have no choice, argues Mr. Tucker, because we have entered an era in which “comfort with ideas and abstractions is the passport to a good job, in which creativity and innovation are the key to the good life” and in which the constant ability to learn how to learn will be the only security you have.

Economics is not like war. It can be win-win. We, China, India and Europe can all flourish. But the ones who flourish most will be those who develop the best broad-based education system, to have the most people doing and designing the most things we can’t even imagine today. China still has to make some very big changes to get there — but so do we.

Eve and Mary are the models of the right way and the wrong way to start a new project, business, campaign or career.

Eve listened to the snake and ate from the Tree of Knowledge. This is the SBA approach to startup, the venture capital model, formal market research and strategic planning. Dr. Amar Bhide has found that successful businesses just don't start this way. www.bhide.net.

Mary was inspired and said yes to the birth of Jesus. This is the aha! of startup, the I in our IDEA model. For more see www.JohnWren.com

To see more about Eve and Mary: http://www.usccb.org/nab/today.shtml