R.I.P. D.I.Y. P.R…Why Press Release Production is Harder Than You Think

I’ve been seeing a growing number of articles questioning whether companies, particularly startups, should be saving money by acting as their own PR firms. It’s interesting to note, too, that many of these articles have been written by PR consultants and small-business coaches-cum-authors. Just saying…

Dallas Mavericks owner, investment tycoon and Shark Tank star Mark Cuban got a rise out of the public relations industry in early 2012 when he was quoted as saying that startups shouldn’t hire PR firms to manage their messaging. And there is some logic behind that.

After all, the arguments against a startup or small company hiring a PR firm come down to the expense of a retainer fee and possible extra billings. With limited funds and irregular cash flow, this view is understandable. There’s also the nagging question of whether the communication services provided correlate into direct ROI.

Naturally, I don’t subscribe to this view. Of course, not every company needs PR assistance. But in an increasingly crowded startup and small business space – employing nearly half of the US private sector and responsible for 60% of all new jobs in the last two decades – getting noticed is a matter of corporate life and death.  

Sometimes professionals are what are needed to get the job done. Actually, it’s a lot like plumbing. Fixing a toilet with duct tape and paper clips will only get you so far. And press releases –central to what our industry produces – are liable to end up in the loo if they’re poorly written.

But love them or hate them, the press release, which appropriately starts with the same letters of our profession, is our calling card. And sadly, I’ve read thousands of press releases that fail to inspire. In fact, we have two former reporters on staff at ThinkInk who have attested to the daily barrage of bad press releases they were subjected to during their journalistic careers. One (who shall remain nameless) even admitted to turning them into paper airplanes and flying them around the newsroom.

Underscoring the point: about a week ago I received a press release – from a man I’ve never heard of at a company I’ve never heard of – announcing that his company won an award which I’ve also never heard of. Just out of PR curiosity, I checked the name of the company president, who is quoted in the release, against the name of the company’s media contact. It turns out it’s the same guy.

To be fair, it’s likely that the company president is so busy actually running the company to put much thought into how he’s telling its story. And that’s exactly the point. This is a communications job for communications professionals. Leave it to us.

After all, there is such a thing as a professional press release. And it starts with an effective headline and email subject line. Both should rely on the tenets of solid journalism: concise noun-verb sentences attracting eyeballs. The body of the release must be story driven; something that evokes a human emotional response. It doesn’t have to be profound. But something like a humdrum building expansion and lease renewal all of a sudden gains added relevance when that client-serving news is anchored to, say, an entire urban core’s renaissance. Placed in that context, a press release transforms from self-servicing copy into another form of narrative writing.

Can a small business hire a team to write these releases in-house?

Yes.

But writing an effective press release is only part of the story. Knowing who to pitch it to makes all the difference. There’s also channel relevance to consider and social media. This mix of writing skills, tech-savvy know-how and networking acumen is critical to what we do, and frankly, why we get paid.

It’s true; public relations services can be costly. And there is often a slow ramp-up period for the selected agency to learn the client’s voice. Unlike newly repaired toilets, ROI benefits aren’t always immediate. But history is filled with examples of PR campaigns that helped turn obscure companies into household names or conversely, re-brand fallen stars.

PR isn’t an instant gratification business. But it is professional in how it operates. To the naysayers who counsel DIY small business and startup PR, I’d urge reconsideration. Your brand only gets one chance to make a first impression. And in the mobile and digital age sometimes your fate is sealed even before that public unveiling.

So if at all possible, leave the PR job to the experts. And if your loo backs up – call a plumber.    

Crowdfunding is Great, But There Are Some Kinks to Iron Out

Several weeks ago I wrote a post celebrating the crowdfunding phenomenon and its positive implications for the innovators out there who are dreaming up tomorrow’s app-development programs, portable solar power stations, 360-degree panoramic film lenses and even wearable Internet connectivity devices.

While I’m definitely very enthused about this democratized form of startup funding, the following VentureBeat article – and its chronicles of Kickstarter projects gone astray – got me thinking about how the very traits that make crowdfunding an equalizer can also lead to fly-by-the-seat-of-their-pants mishaps. Case in point: the problematic jellyfish aquarium that somehow ended up dashing the very creatures it wished to display against the rocks. Combining the hard-to-keep jellies with a haphazard plan for delivering a finished product to funders, I’m afraid these entrepreneurs bit off more than they could chew. No amount of crowdfunding can make up for a lack of business acumen or plain old simple common sense.

To further my point, a recent Wall Street Journal article The Good, The Bad and The Crowdfunded  highlights some of the massive successes and failures from the crowdfunding king, Kickstarter.

Regardless of these highs and lows, is definitely a trend to watch, with the potential to open up all sorts of opportunities both for entrepreneurs and investors.  Just look at all the TED discussions on the topic or at this venture, Fundrise, which aims to simplify putting money into real estate. The Washington, DC food-and-fashion market concept of Maketto, which is being financed through Fundrise, seems like the kind of niche business that could really catch on in a bigger way if crowdfunding finds its place in our economy.

Something tells me it will, kinks or not.

How the Path to Financial Success Has Many Roads and Why Microfinance is Often Overlooked

Imagine a woman who founded a courier company and now has offices and employees in two counties shuttling documents for clients such as architectural and law firms. Envision another woman who turns the love of her native country into a living by selling Colombian souvenirs, crafts, food and clothing. Or dream of a man and his staff who profit from their talents by crafting creative signage and painting custom designs on cars and boats.

These are just three of hundreds of hard-working South Florida entrepreneurs who have wielded maybes and can-dos into realized storefronts and American middle class status. And they’ve done this through a unique financial channel called microlending. While microlending is well known across Latin America and in developing nations, sadly its existence, popularity and prevalence stateside remain in a nascent phase.

Unfortunately, most of the news I read and hear about microfinance in the U.S. involves providing those services abroad when in fact a vast underserved population exists right here. Don’t get me wrong, helping the disenfranchised in places like Sub-Saharan Africa and Asia is a noble thing. But I’m often left wondering why so little of the microfinance conversation involves helping out low-income entrepreneurs right here at home.

Now more than ever, microfinance can be the homegrown vehicle that turns this trend around - especially as the latest jobs report shows the same stubbornly high unemployment, lackluster job creation and consumer penny pinching across the board. The result is that hundreds of thousands of marginal-income families have slipped through the proverbial cracks and our snail-paced economic recovery continues to widen that fissure. Good credit becomes bad credit and access to traditional bank loans dries up.

People can help, and not just by giving donations or crowdfunding, the latest personal investing trend. Many of the recession’s forgotten casualties don’t want handouts; they want opportunities to work themselves out of a financial hole. Kiva Microfunds, a San Francisco-based tiny loan lender, clearly has the right approach. The company connects donors who wish to give money in as little as $25 increments and has lent out $335 million across 62 countries, boasting a 99% repayment rate. Closer to home, Our MicroLending, of Miami, has disbursed over 1,050 loans totaling $6.2 million to over 600 micro-enterprises whose owners use the funds to restock, remodel, expand and hire.

Fortunately there’s other good news as well. Microlending is also increasingly interwoven with the phenomenon of impact investing. Impact investing is the process by which investment takes into account not only direct ROI, but evaluates the social and environmental benefits of doing so. Like mircolending, social impact investing has numerous secondary and tertiary benefits. Blighted neighborhoods on the brink of collapse revitalize, crime rates fall, juvenile delinquency drops and a community or neighborhood has the chance to rebuild. And just this past spring, Morgan Stanley, inspired by its own studies on the matter, announced the launch of its Investing With Impact Platform. J.P. Morgan predicts that, by 2020, there will between $400 billion and $1 trillion invested in ways that have a positive social impact.

So it’s definitely possible to do well by doing good, no matter where funding comes from. A November 2011 report by the University of Pennsylvania’s Wharton School of Business put the number of microfinance institutions in the U.S. at 362. A strong start for sure. But clearly there can (and should) be more. Investing in microfinance for American entrepreneurs and making sure people out there know that this service is available, that self-employment is an option if they’ve lost their jobs, can do a lot to help ease the protracted financial suffering that has left so many of our fellow Americans penniless and without hope.

To dream is priceless. But acting on dreams comes at a price. Mircofinance and social impact investing are paving – and paying – the way forward to turn entrepreneurial dreams into reality. 

Start-Up Capital Democratized: Long Live Crowdfunding!

Back in 1997, the British prog-rock band Marillion was having trouble scraping up the cash to embark on a tour of North America.

This news quickly spread among the group’s devoted fans, who rallied – without the band’s knowledge – and managed to raise $60,000 to help finance the tour. Four years later, Marillion’s hardcore fans, known as “Anoraks,” financed the band’s 2001 record Anoraknophobia by pre-buying copies of an album not yet made.

Just over 10 years after the release of Anoraknophobia, this type of phenomenon now has a name: crowdfunding.  Crowdfunding is getting a lot of media and business attention and there are sites springing up weekly where people can finance start-ups, artists, community projects and charities. What’s unusual about crowdfunding though, is that until now it has only been legal if the funders had no expectation of financial gain. They could receive some sort of benefit-in-kind like an album for example, but it wasn’t considered a bona fide investment – until recently.

Thanks to our slow-jamming President who signed the JOBS Act (Jumpstart Our Business Start-ups in early April 2012), the Securities and Exchange Commission (SEC) is introducing rules that will allow almost anyone to invest in new companies – up to a total of $1 million per year – and receive equity in return, as long as the middleman rounding up the cash is SEC-registered.

The new rules should be in place by the beginning of 2013. This is great news, considering that in our down economy, it’s already difficult enough for start-ups to raise the capital needed for a proper business launch.

So hooray for crowdfunding! This is exactly what those entrepreneurs without access to traditional finance or VC funding need.

The legislators in Washington and suits on Wall Street tell us that the Great Recession is over. But considering the miserable jobs report we got last month, it’s clear that for too many Americans the financial pain endures without respite. Enormous numbers of our young people are graduating from college only to find that the job market simply doesn’t have a place for them.

So, what are many of them doing? They are starting their own businesses, of course. And already, corporations such as Fundable are gearing up to inaugurate investment vehicles wherein anyone with a little cash to spare can help a start-up get a foothold – in exchange for a stake, regardless of its size, in the company.

Let’s hope this democratization of start-up capital fulfills its promise as a fresh new way to support America’s next wave of forward-thinking entrepreneurs.  I’m all for that.