November 27, 2006 Program Summary

“Turning Your Technical Know-How
into Entrepreneurial Success

Speakers Aurora Lipper, Al Lipper, and Mike ErnstAt this exciting event, we heard from three enterprising professionals in our community who have parlayed their technology-related volunteer work, passions for inventing, and ideas for new niche franchises into highly successful businesses.

Our speakers (from right to left) were: Aurora Lipper, rocket scientist, Cal Poly faculty member, and science education entrepreneur; Al Lipper, business coach, Cal Poly faculty member, and former CEO of an engineering company; and Mike Ernst, co-founder and VP of Engineering of MyProSeller.com, an eBay®-related service business. We learned the secrets of how their businesses started, evolved, and flourished through dedication and perseverance.

Al and Aurora jointly presented an overview of how to rocket-launch your small business more easily and inexpensively, and with less hassle. They also engaged the audience in several interactive partner exercises to discuss elements of the following formula:

  • Building the Vehicle: Creating a Clear Vision from Brainstorming Ideas
  • Mapping Out the Path: Strategic and Tactical Planning
  • Fueling Your Business: Revenue Modeling
  • Insurance and Protection: Business Entity Structuring
  • Setting Yourself Up to Win: Developing an Effective Marketing Plan
  • From Pedal to Medal: Sales and Selling
  • The Golden Road: Business Leadership

To download Al's and Aurora's presentation, click here.

For more information, see the two articles below!

The Seven Biggest Mistakes
Small Business Owners Make in Their Business –
And What To Do About Them

by Coach Al Lipper of 'Destiny: Success'

Do you remember when you first started your small business? Remember the excitement? Do you recall how it felt when the phone rang or someone walked in the door? First, let me commend you on entering a profession that is true to your passion, and furthermore, one that serves others.

In this article, I’m going to share with you some of the common mistakes that small business owners often make. If you’ve fallen prey to one or more of these, it simply means that no one told you about them yet. Once you know, then you can focus on solutions. And, perhaps you’ll find that you are already entirely on track, and this may re-affirm that you are headed the right way.

MISTAKE #1: Obsession with the Services You Provide or the Products You Sell.

In business, we ideally view the products and services we sell as generic “black boxes” that either make money or don’t. Imagine you own a gas station – the old fashioned kind that just sells gas and maybe fixes cars (no mini-mart inside).

One day, a salesman comes to you and says, “Hey, I want to put a soda machine in front of your gas station. You can buy cans of soda at $0.25 each and sell them for $1.25 each – you make $1.00 on every can of soda someone buys.”

He offers to rent you the soda machine for $100 per month as long as you agree to have him be the one you buy soda from. You agree and find that you sell 20 cans of soda per day, or 600 per month. In other words, you make $600 per month selling soda, then pay the sales guy $100 of that for renting you the soda machine. In the end, you make $500 profit each month.

So, what does this have to do with running a small business?

You probably couldn’t care less about selling soda, may not drink it and may even emphasize how unhealthy it is for people. Exactly. And the gas station owner feels the same way.

He couldn’t care less about soda or soda machines, but as a business owner, it’s a “black box” that earns him $500 per month in cash. He puts some stuff into the black box (rents the machine for $100 and fills it with soda) and money comes out of it ($500 in profits).


For any business to be truly successful, the owner needs to be able to step back and view it as a collection of “black boxes” that either generate money or support another black box in generating money. Evaluate each major method or strategy your company uses to make money.

Let go of emotional attachment to things like favorite services or products – if they don’t make money for you, change them so they do, or eliminate them. If you can’t bring yourself to do this, acknowledge that this is an area of charity or contribution that your company participates in. But whatever you do, be honest with yourself.

Remember, if your business doesn’t make money, it won’t be around to help anyone in the future. Keep it profitable!

MISTAKE #2: Being in a Rush.

Business usually takes time. Our society is so wrought with instant gratification, we often overlook the fact that things take time. Just as the farmer can’t plant crops too late in the season, then try to “rush” them to grow, certain aspects of business take time. If you are trying a new type of advertising strategy, it might take three months before you can tell if it works or not.


Learn from someone else who has done it successfully before, and ask them how long they waited before seeing results. If we plan ahead and act early, we won’t be in such a rush at the end. For example, don’t think about holiday promotions in November, instead plan them in September in case some actions need to be taken early.

We can often save money by starting early as well – after all, have you ever been to a workshop that cost more if you signed up last-minute than if you registered a month or two in advance? (Hopefully you use this strategy yourself with any programs you offer.)

As you get better at a particular aspect of business, you’ll be able to do it faster, but in the beginning, it takes time. Be patient, evaluate your results and make changes as needed.

MISTAKE #3: Believing That Technical Skill Is the Key to Success.

So often, we believe that with lots of ability in our art we will succeed. We assume that if we enhance our skills and have perfect form that this will make our business more successful. Sadly, this has relatively little truth to it in business.

Technical skill alone is not the key to success, and in fact, technical skill is only a small part of success. If business is slow, we often tend to consider getting more training, another certification or something like that. The real solution usually lies somewhere in business skills and management.

Ask yourself about these areas of your business: Marketing, Sales, Accounting & budgeting, Customer service. I certainly don’t want to minimize the value of your mastery of your field – this is definitely important.

Rather, I am emphasizing that in business, other things usually count more. I know it doesn’t seem right that someone who doesn’t have nearly the ability that you do should have all the clients, but that is generally the reality in business.

Consider the example of the most successful restaurant in history, McDonalds. Could you cook a better burger than they do? Of course – anyone could. It’s not their skill in making burgers that makes them such a success. They do the other stuff so well that people have learned to like their food.


Just as you can watch someone’s form and point out specific errors that they are oblivious to, you also have the potential to see your business in the same way. With the right perspective and knowledge, a business owner can very specifically identify a problem area and what needs to change. But only in rare cases is the problem actually the technical skill of services being delivered to the customer.

MISTAKE #4: Being So Excited That You Are Driven by Emotions, Not Logic.

Sometimes we get so attached to an idea – maybe one we created ourselves – that we forget to do a logical analysis. I remember a small store that sold specialty food products. The owner loved spicy food, so decided to offer hot sauces from all over the world.

He expanded the concept such that a great deal of his inventory was essentially hot sauce. For months, he didn’t acknowledge that his sales had significantly decreased, because he was so excited about the idea that people love hot food – he loved hot food.

Less than a year later, he was sadly forced to face the reality when he could no longer pay his bills and had to close the business.

It’s always easy to see it in other people, but very hard to see in ourselves. Is there a product service that you created, which for whatever reason has few sales? Consider areas of business where you are being guided by emotions, not facts.


When we are emotionally driven in business, our strengths become weaknesses. Self-confidence becomes arrogance, ambition becomes ruthlessness, quick-thinking becomes impulsiveness, strategic risk-taking turns to gambling.

And one clear sign that emotions are taking over is that in discussions of a given topic, there is a clear need to “be right” instead of a striving to do what is best for the company.

The solution is simply to back away and treat it like the “Black box” we discussed earlier—it’s just a soda machine that makes money or it doesn’t.

Another technique is to ask someone else for their honest opinion with the understanding that you will not interrupt them, or offer any feedback other than asking informational questions. Remember, successful business is driven by facts, not emotions.

MISTAKE #5: Not Having a Backup Plan.

This one is pretty straightforward. Any time you try something new, at least have a rough idea of what you will do if it doesn’t work. When an airplane flies toward it’s destination, before it even takes off, the pilot always selects an alternate airport in case he can’t land at the original destination.

He makes sure he has enough fuel to get there. He doesn’t plan all the details, but just knows what the alternative is and that there’s enough gas in the tank to make it.


I encourage you to do the same thing with any new business tactic. If you take a lot of money to invest in new product inventory, expecting you can make a killing selling it, have a backup plan. What would you do if it didn’t sell? What if it was a total disaster?

In a case like this, you might decide that you could sell it at half it’s value to a large retailer, but at least it wouldn’t be a total loss. You want to make sure that you’re not going to go out of business if an idea doesn’t work. Always have a rough idea of a backup plan.

MISTAKE #6: Running Out of Cash.

This one sounds obvious, so let me clarify. This mistake is about having a plan for what needs to be done to create a successful business, but running out of money before it gets there.

For example, suppose a new yoga studio owner has estimated that it will cost $150,000 to open the yoga studio, buy all needed equipment, supplies and inventory, and pay operating expenses for one year. After this point, the owner expects to have enough students, clients and customers that she will be able to cover the cost of all her monthly expenses (including paying staff and herself) and begin paying back the $150,000.

However, imagine that getting things going ended up costing $200,000 and even at that, there isn’t much left for an advertising budget. After one year rolls around, she’s not even close to making enough money each month to pay expenses (in part because she didn’t have money for advertising), let alone repay the debt. She has run out of cash.


First, make your cost projections worst-case. A quick way of doing this is to figure out best-case, then double it. No kidding, you’ll be pretty close to the actual cost about 80% of the time.

If you think it will cost $10,000, then make sure you have $20,000 available (but still try to do it in $10,000 and in fact, base your whole budget on $10,000).

Next: Plan, Plan, Plan! So many people dive in without a plan, only to find out they spent lots of time and money on things that do not generate any return. Bottom line: Expect it will take twice as much cash as you think.

MISTAKE #7: Re-Inventing the Wheel.

Lots of people (and companies) have opened and operated successful businesses for years. There are people who know the answers to questions that frustrate you and problems that cost you money. One reason franchises are so successful is that they give a business owner answers to nearly every question regarding running the business.


So, don’t re-invent the wheel. I can’t emphasize this enough. There are people who know how to run a small business very profitably. Find them. Observe them. Talk to them. Model them. They may even be willing to actively mentor you.

If you find a successful business similar to yours in a non-local area (that is, they don’t compete with you), the owner may be more than happy to share. If you need to hire consultants for marketing, web site design, business planning, accounting, and so forth, then do it. It’s expensive up front, but once you learn the right way to do things, you can either take it over on your own or hire someone lower-priced and tell them what to do.

Bottom line: If someone else has done it before successfully, learn from them before trying to figure it out on your own.


There you have it – the seven most common mistakes small business owners make in business. Few of us ever had a class or mentor to teach us how to run a business. Unfortunately, 8 out of 10 small businesses will fail because of this lack of experience.

Do whatever you have to in order to do it right (remember, don’t re-invent the wheel!) Read books, get online courses, find a mentor, get a good business coach and model a successful business just like the one you’re trying to do. There are so many people who are really successful at running a small business.

Learn from the experience of others and be one of the ones who has passed the stage of hard work, and now enjoys doing just what you want to in your business.

To your success!

Coach Al Lipper of 'Destiny: Success' helps stressed and overwhelmed small business owners who spend most their time wrapped up in daily business tasks, who can't handle any more clients, or who unable to increase their profits from their current business structure. Coach Al helps business owners find new business strategies that result in generating more clients, increased profits, and more free time for the business owner. The amount invested is small compared to the results. Contact him today to discuss your small business challenges at (805) 544-3938, email: coach@DestinySuccess.com, or visit http://www.DestinySuccess.com.

Al attended Occidental College in Los Angeles where he obtained his Advanced Bachelor's Degree in Cognitive Science (study of human thought). While in California, Al received a Ford Foundation fellowship, and later completed his Master's Degree in Education at Cal Poly. As an avid aviator, Al earned a Commercial Pilot license, as well as Flight Instructor and Advanced Ground School Instructor certifications. In June 1999, he completed a second Master's Degree in Psychology at the Institute of Transpersonal Psychology in the San Francisco Bay Area. During 2006, Al entered Mastery University at Robbins Research Institute.

For over 15 years, Al conducted workshops that focus on communication and teamwork for professionals. Additionally, he has facilitated workshops emphasizing personal empowerment, self-confidence and leadership for clients of all ages. His business experience has grown as he initiated a number of start-up companies. More recently, he served for four years as President & CEO of an engineering company. Based on his extensive background, Al was asked to be on the faculty at California Polytechnic University in the College of Business, where he taught for three years.

Aurora Lipper is an instructor, speaker, astronomer, pilot, engineer, mom, teacher, and rocket scientist. She obtained a Bachelor's Degree in Mechanical Engineering (with a minor in Mathematics and senior project in Rocket Science) from Cal Poly in June 1996, then went on to complete a Master's Degree in Mechanical Engineering at Cal Poly. With the idea of teaching at the university level, she then began her doctoral studies at Stanford University in the High Temperature Gas Dynamics Lab (Combustion) and spent her free time at the local children's museum in the San Francisco Bay Area.

Inspired by the idea of engaging children with science, after six months, Aurora returned to Cal Poly and taught for several years while creating her own unique set of physical science lessons. After a while, she realized how much physical science was really needed in all levels of public schools, and was able to create an amazing program that inspired thousands of kids to experiment with science on their own. Aurora also created Camp Kinetic, a summer science camp for 7-12 year olds in the area. Originally planned for 48 kids, it soon grew to accommodate over 200! Aurora has since taught thousands of students and was in 60% of the schools in SLO county.

Starting a Business Requires a Team Effort:
The Story of MyProSeller.com
Summary by Adele Sommers

Mike Ernst (joining us for the Q&A session) is the co-founder and the VP of Engineering at MyProSeller.com, an eBay-related service company. This service acts as an intermediary for people who don't want the hassle of setting up and running their own eBay auctions.

MyProSeller.com identifies and researches the items people wish to sell, prepares the items for sale (including taking digital photos and creating professional listings), and handles all questions, payments, shipping labels, customer service, and returns, all without up front fees.

How Did MyProSeller.com Launch?

Mike has over 16 years of experience with four previous startup companies, and he readily admitted that he was ready to pursue yet another entrepreneurial launch when the urge struck again. He and his partners started MyProSeller.com on a shoestring budget, but with a big-picture vision of the operation it could become.

To get the business going, they needed to find a stellar team and persuade that team to help indefinitely for little or no direct compensation. They arranged for an “equity swap,” where the contributors exchange their time for shares of profit, roughly analogous to stock.

Mike explained that by using an LLC (a limited liability corporation) rather than another type of corporate entity, the partners could give contributors profit shares as a form of equity. This provided a way to avoid the tax consequences that shares of stock would have incurred while the recipients were not yet receiving income from the business.

The partners tapped colleagues they had known for years, such as people with whom they had worked on previous projects, or others referred by close associates. The core team's passion and vision for the company ultimately excited and attracted a host of people who wanted a creative outlet and a way to be in on the ground floor of something new and unique.

About 30 people so far have contributed expertise on a part-time basis in areas such as legal, accounting, finance, marketing, sales, operations, and engineering. Most of the contributors have day jobs and work for MyProSeller.com during evenings and weekends, thereby reducing the risk for all concerned. The company now employs 22 people in both specialized and hourly capacities.

How Did the Business Seek Funding?

Mike revealed that he and his partners considered seeking either venture capital (VC) or angel investor funding, but leaned quickly toward the latter. Angel funding typically comes from networks of accredited investors who meet the Securities and Exchange Commission's definition of “wealthy” in terms of net worth and income. Mike explained that angel investors are usually easier to find then VC funding, which has become much harder to tap in recent years and is now typically available only to larger enterprises.

To seek their first round of angel funding, the partners painstakingly crafted a formal business plan. In retrospect, Mike feels strongly they would never take that route again. After family and friends gave the plan glowing reviews, the partners saw it ripped to shreds by more astute legal and funding experts. They went back to the drawing board to drastically revise the business model and prepare new presentations. Many versions later, Mike has the following advice:

  • Skip the business plan. Instead, first create a high-level slide presentation and obtain sophisticated feedback as early as possible from financial and legal advisors. Make changes to the business model as needed before proceeding any further.
  • When the model passes muster locally, create an executive summary to go with the slide presentation and show the package to prospective investors. Get as much feedback as possible from a variety of interested investors. Keep the presentation in a fluid mode, since it will need to change dynamically over time.

How Does MyProSeller.com Differ from Other eBay Services?

Mike acknowledged that there are various other intermediary services that help people sell items on eBay, so the partners soon abandoned the idea of operating as a “drop-off counter” or creating a franchise around the business. They also do not handle any merchandise directly.

Instead, Mike and his partners have found three very lucrative niches in the giant eBay marketplace. They are:

  • Helping existing businesses manage eBay storefronts. This is a complex process that normally requires many steps and considerable technical know-how. MyProSeller.com has created advanced technology to make the process simple and smooth, thereby easing the process dramatically for business owners.
  • Helping charitable organizations receive proceeds from eBay sales as donations. These organizations can now offer MyProSeller.com's services to their constituents who wish to make donations via selling personal items on eBay.
  • Helping charities, such as Goodwill, sell high-value items for a decent profit. Mike explained that many times, valuable items sell for only a few dollars (if at all) in the stores, but could fetch very good prices in online auctions. This is a booming area that the partners expect to see grow dramatically in the future.

In conclusion, MyProSeller.com launched and continues to expand due to a solid team effort. From exciting and attracting a talented core of experts, to seeking feedback and polishing the business model and related presentations, to running the day-to-day operations, every aspect depends on engaging the team to pull off both the magic and the grunt work of helping the business grow.

For more information on any of the services mentioned above, please contact Horace Morana at 1-866-922-3279 or hmorana@myproseller.com.


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