ENT 600-50_Week 3 Post

Learning the difference between social and financial capital and how these resources can help a founder make the leap into founderhood was very captivating.  In the Founder’s Dilemmas by Noam Wasserman, I learned about which capital is better to accumulate that the other between social and financial capital.  Social capital is the social and professional relationships that founders have established over the years and help them have access to resources through those relationships.  When you are talking about social capital, youth is often at the disadvantage because they have not built as many relationships because they have not been around as long.

Financial capital is the cash cushion that a founder establishes that will keep them going after leaving their job to pursue their startup.  The amount of money that a founder needs will depend on a variety of different factors such as:  the length of time that is needed for the startup, the amount of stress, energy, & urgency the founder will need to become cash flow positive, and the decisions that need to be made in order to build the startup.   It is not surprising that over 50% of people who are seriously considering becoming entrepreneurs do not end up pursuing their dreams because they do not have the financial capital to do so.

Wasserman talks about the accumulation of one capital can spark a successful cycle that can help launch their startup.  Social capital is the most virtuous types of capital to have because it is able to attract more human and financial capital which is needed to launch your startup and do so much more quickly.  In terms of social capital, I believe that with the rise of social media in recent years has helped many entrepreneurs open doors that they would not have access to otherwise.  Entrepreneurs now have millions of other entrepreneurs, venture capitalists, and consultants at their fingertips within seconds because of a single post on social media.  Social media has become our best networking tool if we choose to use it to our advantage.

I plan to build my social capital before completely launching my startup.  I want to stay behind and build as many relationships as I can and add as many people to my virtual Rolodex before I take the fateful leap into founderhood.  I also plan to stay at my job until I can no longer adequately balance my two jobs.  I have always had the dream of going to my boss and telling him that I must leave because my business requires my full attention now.  I would be lying if I said I did not think about that day a lot and get a little excited when I think about the conversation.  For now, I will continue to chip away at my business and build it into the beautiful startup I imagine it to be.  But a girl can dream, right?

I learned some interesting things while reading this section and I enjoyed it.  I hope that you learned something in reading my post.  Leave me a comment below telling me your thoughts on social media, is it good or bad for business?

Thank you for stopping by.

Until next time,
Dani

14 thoughts on “ENT 600-50_Week 3 Post

  1. PK Reyna

    You make an excellent point regarding the use of social media to connect to others. I agree with your comment “…the rise of social media in recent years has helped many entrepreneurs open doors that they would not have access to otherwise.” Excellent point! Any suggestions for making the use of social media even more effective for businesses?

    Like

    1. Dani Shirey

      Thank you very much for your feedback on my post. If I were to give you any suggestions about social media is do your best to get your name out there and post often.
      I used to never post because I wanted to have the “perfect post” every single time and then I realized i was never posting anything because I was not happy with it. I now just post that is happening just to get my presence out there. I try to post 2-3 times a week just to keep up in the feeds and keep people interested. I would also say make it personal, let your followers feel like you are talking to them personally and inviting them in to your work.

      I hope this helps.
      Thanks,
      Dani

      Like

  2. Marhynes

    Dani,
    I really enjoyed reading your post! I feel the exact same as you do when it comes to building social and financial capital first before taking that big step to leaving a job. I loved the part when you explained how often you think about the moment when you’re ready to tell your boss your business will need your full attention. That would probably be one of the best feelings in the world for sure. I clearly understood the content from the book through your post and it was very relatable. I really look forward to reading more of your post!

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    1. Dani Shirey

      Thank you so much. I really appreciate it. I think about the moment when I tell my boss I am leaving so much, I can hear how the conversation would go. I was just telling my husband that I can visualize my shop so vividly, I can almost smell how it would smell. I hope that doesn’t make me sound crazy.

      I really appreciate you stopping by to read my blog.
      Thanks,
      Dani

      Like

  3. Kari

    I find it interesting that you incorporated social media into gaining more social capital. Although true, Wasserman didn’t really expound on this social option. I, like you, feel that the boom of social media access has afforded us all the opportunity to greatly enhance our social rolodex. I intend to us this option before and during the start of my business to gain more connections with future partners, investors, customers, etc. I wish you look and hopefully your dream of talking to your boss happens sooner than later.

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    1. Dani Shirey

      Hi Kari,
      Thank you so much for stopping by to read my blog. I do not mind using social media for my business but I am not the best at staying on top of it. I have gotten much better in recent weeks and I plan to improve even more. It really does increase your exposure in a way most companies could not get if they bypassed social media. It is a great way to get your name out there. You can partner with other businesses for giveaways, the possibilities are endless.

      keep up the great work and thank you again for stopping by.

      Warm Regards,
      Dani

      Like

  4. Jose F Saavedra

    Dani,
    After reading your post, it made me revisit Wasserman’s point about the “youth disadvantage” when it comes to social capital. I think it is tremendously important to network and build strong lasting relationships especially when you lack experience due to your younger age. I consider myself a young professional and I can relate to the need to grow and expand my network and social capital. In order to achieve this goal I joined trade associations in the aviation industry and have been attending conferences. These events have provided great networking opportunities and social media such as Facebook and LinkedIn have proved to be very helpful in maintaining those relationships. I agree with your point on these platforms being useful tools to maintain your network and even help it grow. While I was working on the Equity Structure assignment, I kept thinking back to some of my LinkedIn connections as possible key players to my organizational chart. I think social media and the internet are very useful tools that should be natural friends to any entrepreneur!

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    1. Dani Shirey

      Hi Jose,

      I really like networking and getting to know people. One of my favorite ways to network for my business is when I go to craft shows or farmers markets. A craft show is how I found out about Square credit card system when they were first coming out. it is a great way to meet other vendors, find out about other shows or opportunities and make some great friends. My friend Erica is one of the best networkers I have ever met. She honestly makes friends everywhere she goes, I want to take her to the next show or market I work.

      Thank you for stopping by and leaving me a comment, Jose. I really appreciate it.

      Warm Regards,
      Dani

      Like

  5. Michael Walton

    Your comments are right on point, the difference between Social and Financial capital. As I thought about it a bit I realized that I did not look for investors while starting up my business but I most assuredly worked with the networking opportunities to ensure that the market would know I existed. I had the financial capital but I needed the social capital, and networking did it for me.

    I really liked your comment: Entrepreneurs now have millions of other entrepreneurs, venture capitalists, and consultants at their fingertips within seconds because of a single post on social media. Immediately GoFundMe came to mind. GoFundMe may not be meant to obtain capital to start a business but I’ll bet that it has and has done so many times. In fact, try to pitch a great idea for a company on GoFundMe, announce the capital requirements, and inform all investors that you will receive a percentage of the company based upon your GoFundMe contribution. Worth a try, right?

    Like

    1. Dani Shirey

      Thank you for stopping by and reading my blog. I think I need to work on both aspects of capital at the moment but I have some time to work on them.
      CrowdOx and KickStarter are 2 great crowd sourcing websites that are taking off in the entrepreneurial world. It is crazy for me to think about all of the different resources that are out there now for networking and crowdsourcing that were not really available when I finished my undergrad in 2013.

      Thank you so much again for stopping by.

      Warm Regards,
      Dani

      Like

  6. Tosh R. Comer

    Hey Dani,
    Great job on your post.

    Using social media for any purpose has its dangers and rewards. Although meeting someone online is now commonly accepted, there are still drawbacks to not meeting a person face to face especially when money is involved. One might argue that just because you meet someone face to face doesn’t mean they come with the best intentions. This is unquestionably true. However, when you have trusted contacts in your corner you typically can weed out the “bad apples.”

    I would recommend founders to use trusted sites that require extensive information from investors or startups like SeedInvest.com or Angel List. I would thoroughly research sites and try to communicate with someone who has previously had success with building capital online.

    Like

    1. Dani Shirey

      Hey Tosh,

      Thank you very much for stopping by my blog and leaving a comment. I completely agree with you about meeting people online and using them as investors. My thought process about social media was more along the lines of networking and exposure as opposed to finding investors online.

      There are certainly ups and downs to using social media in any aspect. I have created 2 separate accounts, one for my personal life and one for my business. I try very hard not to cross them unless my personal account is referencing my business account. I never do it the other way around. I have seen people who do and I do not think it looks the best because customers are seeing you in a professional light and if you are posting not the most professional things, you run the risk of losing your customer base.

      I will certainly have to look into those websites when it comes time for me to reach out to investors. I will also make sure I that I do my research before I jump into anything. I research almost anything before I move forward, from restaurants to products to service companies.

      Thank you so much for dropping by again.
      Warm Regards,
      Dani

      Like

  7. Jennifer West

    Social media is certainly a good tool when it comes to building social capital and financial capital, also. Building a strong online presence is essential in today’s business world. My only word of caution is that you should keep your personal social media presence and your business social media presence completely separate. Save the personal stuff for your friends and family and the business platform for growing your company. I know this may sound like common sense, however, I have seen a few people make themselves look very foolish by posting personal business in a location where professional contacts could see it. Let’s just say, they put their own professional credibility on the line. Just something to consider…

    Like

    1. Dani Shirey

      Hey Jennifer,

      I could not agree with you more. I know of someone who posted about their personal account on their business account and I was not that impressed. I saw them in a completely different light after looking at their personal page and the things they post on there. It almost made me sad because I had such high thoughts of them and they ruined it with a single post.

      I keep my account separate and sometimes mention my business page on my personal page but I never mention my personal page on my business page. I am also very careful about who I follow on my business page, I do not follow any celebrities, religious figures, political figures, etc. I would not like to lose anyone just because I forgot I followed Kylie Jenner when I first made the account. I also refrain from posting anything “controversial” on either account.

      I think you have some great advice that could save some people a lot of headache in the future. Thank you very much for stopping by my blog and leaving a comment.

      Warm Regards,
      Dani

      Like

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