The Unasked Question: Should You Open a Business?

There's been a lot of cheerleading for entrepreneurship the past couple of years. Many people laid off from corporate America have plunged into starting their own businesses -- driving the start-up rate to its 15-year high.

But is that necessarily a good thing? No-nonsense business advisor Carol Roth says not really. The downturn is prompting many people to start businesses, she asserts, who probably could save a lot of money and aggravation if they just skipped it.

In her new book, The Entrepreneur Equation -- Evaluating the Realities, Risks, and Rewards of Having Your Own Business, Roth asks the question that is the 500-pound elephant in the room of most entrepreneurship discussions since the downturn: Should you start a business?

Historically, the vast majority of startups end in failure. Unemployed people starting businesses now out of desperation because they can't find a job will likely fare even worse, as many just aren't cut out for entrepreneurial life, Roth says. She's hoping her book can help guide would-be entrepreneurs into better business decisions -- because if we can improve the success rate of entrepreneurs, it would really ignite the economy.

"We can't have entrepreneurship be the engine that drives our country if nine out of ten people don't succeed at it," she notes.

One common flub is deciding to turn a personal passion or hobby into a business, without considering how that will change your relationship to the activity. Not every hobby should be your full-time activity, Roth says. Try to work in the type of business that interests you before you take the leap to see if you'd really like it.

"I had a woman in financial services working for a major Wall Street firm tell me, 'I'm passionate about healthy fast food, so I want to open a Subway franchise,'" Roth relates. "I said, 'That's nice. Go work nights and weekends in a Subway franchise and see if you like it.' A few weeks later she came back to me and said, 'If I never see another $5 foot-long in my life, that'd be fine. You just saved me from wasting a six-figure investment.'"

Too many people are plunging into entrepreneurship without assessing their skills, Roth says. Do you have management experience? Work well with others? Are you really ready for the 24/7 responsibility of launching a new enterprise?

Besides taking a hard look at your abilities, personality type is another factor to consider, Roth says. The perpetually broke will have a tough time getting a business off the ground, as will those with poor money-management skills and those who are too risk-averse.

Franchises a Draw for Minority Entrepreneurs

Franchises appear to be an increasingly strong draw for entrepreneurs from minority racial groups.

A greater percentage of Asians, African-Americans and other minorities are buying into franchised businesses, as opposed to starting their own independent businesses, says a recent study from the International Franchise Association.

And while white franchise owners remain dominant in the industry, their ownership percentage declined from 2002 to 2007 while minority representation edged higher.

"The rise in minorities is a reflection of demographic changes," IFA spokesman Matthew Haller said. "As more minorities establish themselves in the U.S., they are looking to control their destiny through business ownership." Franchising, he adds, "offers some stability that you may not get, going it yourself though a start-up."

Many minority owners have become multi-unit franchise operators, Haller said.

In 2007, minorities owned 20.5 percent of franchised businesses, compared with 14.2 percent of non-franchise businesses, according to the report, prepared by PricewaterhouseCoopers, using data from the U.S. Census Bureau's 2007 Survey of Business Owners.

In 2002, minority entrepreneurs owned 19.3 percent of franchises, the report said.

The survey defines businesses at least 51 percent owned by those from a non-white racial group or of Hispanic ancestry as minority-owned.

Franchises accounted for 3 percent of minority-owned businesses in 2007, slightly more than in 2002 and more than the 1.9 percent of non-minority owned businesses that were franchises in 2007.

White entrepreneurs, meanwhile, owned 73.3 percent of franchised businesses and 80.6 percent of non-franchised businesses in 2007. They owned 79.2 percent of franchised businesses in 2002, so their large representation declined.

Breaking the numbers down a bit:

• Asians owned 10.4 percent of all franchises and 4.9 percent of non-franchise companies in 2007.
• Blacks owned 4.9 percent of franchises and 3.6 percent of non-franchised businesses.
• For Hispanics, the representation was roughly even, with ownership of 5.2 percent of franchised businesses and 5.4 percent of non-franchised businesses.

The Top 10 Business Plan Mistakes

It’s been nearly seven years since I posted Top 10 Business Plan Mistakes on this site. Looking back and reading the post again today, I think the list holds up very well. Still, I can’t resist making a few changes. So here is my revised version for 2012, incorporating what I wrote back then that still holds true.

1. Misunderstanding the purpose: It’s the planning that matters, not just the document. You engage in planning your business because planning becomes management. Planning is a process of setting goals and establishing specific measures of progress, then tracking your progress and following up with course corrections. The plan itself is just the first step; it is reviewed and revised often. Don’t even print it unless you absolutely have to. Leave it on a digital network instead.

2. Doing it in one big push; do it in pieces and steps. The plan is a set of connected modules, like blocks. Start anywhere and get going. Do the part that interests you most, or the part that provides the most immediate benefit. That might be strategy, concepts, target markets, business offerings, projections, mantra, vision, whatever. . . just get going.

3. Finishing your plan. If your plan is done, then your business is done. That most recent version is just a snapshot of what the plan was then. It should always be alive and changing to reflect changing assumptions.

4. Hiding your plan from your team. It’s a management tool. Use common sense about what you share with everybody on your team, keeping some information, such as individual salaries, confidential. But do share the goals and measurements, using the planning to build team spirit and peer collaboration. That doesn’t mean sharing the plan with outsiders, except when you have to, such as when you’re seeking capital.

5. Confusing cash with profits. There's a huge difference between the two. Waiting for customers to pay can cripple your financial situation without affecting your profits. Loading your inventory absorbs money without changing profits. Profits are an accounting concept; cash is money in the bank. You don't pay your bills with profits.

6. Diluting your priorities. A plan that stresses three or four priorities is a plan with focus and power. People can understand three or four main points. A plan that lists 20 priorities doesn't really have any.

7. Overvaluing the business idea. What gives an idea value isn’t the idea itself but the business that's built on it. It takes employees showing up every morning, phone calls being answered, products being built, ordered and shipped, services being rendered, and customers paying their bills to make an idea a business. Either write a business plan that shows you building a business around that great idea, or forget it. An idea alone does not a great business make.

8. Fudging the details in the first 12 months. By details, I mean your financials, milestones, responsibilities and deadlines. Cash flow is most important, but you also need lots of details when it comes to assigning tasks to people, setting dates, and specifying what's supposed to happen and who's supposed to make it happen. These details really matter. A business plan is wasted without them.

9. Sweating the details for the later years. This is about planning, not accounting. As important as monthly details are in the beginning, they become a waste of time later on. How can you project monthly cash flow three years from now when your sales forecast is so uncertain? Sure, you can plan in five, 10 or even 20-year horizons in the major conceptual text, but you can't plan in monthly detail past the first year. Nobody expects it, and nobody believes it.

10. Making absurd forecasts. Nobody believes absurdly high “hockey stick” sales projections. And forecasting unusually high profitability usually means you don’t have a realistic understanding of expenses.

Mark Cuban's 12 Rules for Startups

Anyone who has started a business has his or her own rules and guidelines, so I thought I would add to the memo with my own. My "rules" below aren't just for those founding the companies, but for those who are considering going to work for them, as well.

1. Don't start a company unless it's an obsession and something you love.

2. If you have an exit strategy, it's not an obsession.

3. Hire people who you think will love working there.

4. Sales Cure All. Know how your company will make money and how you will actually make sales.

5. Know your core competencies and focus on being great at them. Pay up for people in your core competencies. Get the best. Outside the core competencies, hire people that fit your culture but aren't as expensive to pay.

6. An espresso machine? Are you kidding me? Coffee is for closers. Sodas are free. Lunch is a chance to get out of the office and talk. There are 24 hours in a day, and if people like their jobs, they will find ways to use as much of it as possible to do their jobs.

7. No offices. Open offices keep everyone in tune with what is going on and keep the energy up. If an employee is about privacy, show him or her how to use the lock on the bathroom. There is nothing private in a startup. This is also a good way to keep from hiring executives who cannot operate successfully in a startup. My biggest fear was always hiring someone who wanted to build an empire. If the person demands to fly first class or to bring over a personal secretary, run away. If an exec won't go on sales calls, run away. They are empire builders and will pollute your company.

8. As far as technology, go with what you know. That is always the most inexpensive way. If you know Apple, use it. If you know Vista, ask yourself why, then use it. It's a startup so there are just a few employees. Let people use what they know.

9. Keep the organization flat. If you have managers reporting to managers in a startup, you will fail. Once you get beyond startup, if you have managers reporting to managers, you will create politics.

10. Never buy swag. A sure sign of failure for a startup is when someone sends me logo-embroidered polo shirts. If your people are at shows and in public, it's okay to buy for your own employees, but if you really think people are going to wear your branded polo when they're out and about, you are mistaken and have no idea how to spend your money.

11. Never hire a PR firm. A public relations firm will call or email people in the publications you already read, on the shows you already watch and at the websites you already surf. Those people publish their emails. Whenever you consume any information related to your field, get the email of the person publishing it and send them a message introducing yourself and the company. Their job is to find new stuff. They will welcome hearing from the founder instead of some PR flack. Once you establish communication with that person, make yourself available to answer their questions about the industry and be a source for them. If you are smart, they will use you.

12. Make the job fun for employees. Keep a pulse on the stress levels and accomplishments of your people and reward them. My first company, MicroSolutions, when we had a record sales month, or someone did something special, I would walk around handing out $100 bills to salespeople. At Broadcast.com and MicroSolutions, we had a company shot. The Kamikaze. We would take people to a bar every now and then and buy one or ten for everyone. At MicroSolutions, more often than not we had vendors cover the tab. Vendors always love a good party.

How to Raise Money for Your Startup -- Now

LONG BEACH, Calif. -- Raising capital for a startup venture during these difficult economic times has been a major obstacle for many aspiring entrepreneurs. But it's not impossible.

There are several steps budding business owners can take to get in front of prospective investors and to help make sure they pony over the cash you need, says Asheesh Advani, author and co-founder of CircleLending, a peer-to-peer lending service that was acquired by Virgin Money USA in 2007. He now serves as CEO of asset management services company Covestor. Advani was a speaker at Entrepreneur's Growth Conference here on Jan. 11, 2012.

Here are Advani's best tips for landing the money you'll need to get your business off the ground:

Know the different types of investors. There are three types of people who might invest their money in your business idea: friendly investors, hobby angels and professional investors. Friendly investors are the people you know personally, namely friends and family. Hobby angels are individual investors who are most likely professionals themselves who have some money to spare. Professional investors, of course, include venture capitalists, angels and banks. "Professional investors care most about the economics of your business," Advani says. "Whether they understand your business or not, they're required to consider your business idea, as well as countless others."

Make a list of prospects. Scour your industry and your professional network to put together a first group of people and test your business pitch, he says. If the people in this initial group appear to be interested, expand your list of prospects from there.

"When I started my businesses, I wound up raising money from 75 different investors," Advani says. "Not because I wanted to. I needed to."

Related: Highlights from the 2012 Entrepreneur Growth Conference

He suggests keeping track of your contacts, your meetings and your goals for each of the meetings. Keep in touch with the contacts throughout the pitching process.

Set a closing date. Determine a specific, official date for when interested professional investors need to get you the money they promised -- and hold them to it. When dealing with friendly and hobby angels, Advani suggests a "rolling closing date," meaning that you'll accept the investment money as soon as they're willing to give it. Also, be sure to be clear with friendly investors about what happens if the money they invest isn't paid back on time or at all.

"These are people who are close to you, so do everything you can to maintain a good relationship," Advani says.

Use middle men carefully. Third-party groups can be great for two things, Advani says. They can help connect entrepreneurs to individual investors they didn't otherwise know. Examples include peer lending and investing sites Lending Club and Prosper.

Crowd funding sites are another option. These services -- including Pro Founder andPeerbackers -- can help entrepreneurs collect numerous investments from people via social networks.

But be careful about sharing your business idea online, Advani warns. "Before you post a profile on any of these sites, remember that everyone will know what you're planning to do," he says.

How to Use Social Media for Research and Development

Have you ever wished you could use social media to conduct a focus group on your product or service offerings? No, you can't just open a Twitter account and say, "Hey, what do you think of our new recipe for pie?" But you can approach social media and use it for research and development two different ways: social media monitoring and directly seeking customer feedback. This is feasible even for a small business or one without a research-and-development budget.

The first approach is to use social media monitoring to gather intelligence about your company, product or service, competitors or industry. By listening to online conversations about certain topics your customers might be talking about, you can gather competitive intelligence that can inform your decision making and produce a better offering.

Let's say you make custom handbags and sell them from your brick-and-mortar location in San Francisco that and they sell fairly well. But you need some R&D or at least some market research to know if what you're planning to produce makes sense for the new spring line you intend to roll out in the coming weeks.

So you go to a free monitoring service like SocialMention.com or even invest in something a bit more sophisticated, like uberVu, for about $40 per month. You enter some keywords and tinker with a search until you start to see some relevant results for conversations occurring from users in or around Northern California. For instance, "My handbag needs more dividers. I can't keep my stuff organized," is a phrase you might see pop up a couple of times.

Then you might notice that when people are talking about what their handbag or purse needs, they say the purse needs to be big enough to hold an iPad inconspicuously. And there's your new product idea harvested from raw data on the Web.

A second approach is to openly participate in social media and build purposeful relationships and connection with your actual customers so you can turn to them into your focus group. As an active social media participant -- building followers on Twitter, fans and likes on Facebook, readers of your blog or even subscribers to your email newsletter -- you're essentially growing your potential focus group every day.

There are four general steps to conducting research:

1. Set the goals for the research.
2. Establish the important questions to ask.
3. Research and collect answers to the important questions.
4. Analyze the answers to make decisions.

How does that translate to practical application? Make a list of the product or service feedback items you might want to ask customers about. Then make a list of the information you'd like to know about your customers or prospective customers. Look at that list and pick the one or two major areas you wish you could solve with a little customer input or feedback.

Let's say your top priority is to get new product feature suggestions. Start identifying the important questions that you need to ask your customers. Is the handle sturdy enough? Would you change anything about the colors?

You don't need to be a market researcher to ask questions, but you should probably try to ask questions that allow your audience to give the most unaided feedback. For example, asking "Is the handle sturdy enough?" might be better asked by saying, "On a scale of 1–10 with 10 being most sturdy and 1 being least sturdy, how sturdy would you rate the handle?"

After you've listed the questions you want to ask, you just need to deliver them to an audience to answer. For instance, when it's time to find out what folks like or dislike about last year's line of handbags, or what they'd find useful in new versions for the spring season, you might post this question on your Facebook page: "What about your handbag could be better? Any need for more/bigger/smaller pockets? Are you carrying more accessories that we should account for?"

Chances are, you won't get a lot of responses the first time you ask, but you can keep asking. Also, you can ask fans to subscribe to an email list specifically for "New Product Ideas & Feedback," or even offer incentives for participation with discounts to anyone who answers.

These two scenarios don't require big budgets, lots of scientific testing, or even geeks in lab coats. But they are legitimate research-and-development practices any business can use by implementing social media for R&D purposes.

Are You a Born Entrepreneur? (Opinion)

Guest op-ed contributor Scott Shane is a professor of entrepreneurial studies at Case Western Reserve University. He writes about entrepreneurship and innovation management, among other things.

Ever wonder why so many children of entrepreneurs become entrepreneurs themselves?

One reason is that our genes influence the decision to start a business. I don't mean that figuratively; I mean it scientifically. With colleagues at Kings College in London and the University of Cyprus, I have been investigating how genes affect entrepreneurship for more than five years. Through studies of twins, and more recently, through molecular genetics laboratory research, we have found that genes influence whether people start businesses, are self-employed, or have owned their own companies. Our research shows that the same genetic factors influence the tendency both to see business opportunities and to start companies, as well as how much money self-employed people earn.

At this point you may be wondering how researchers could determine that there's a genetic component to entrepreneurship. It's actually pretty straightforward.

With twins, it's a matter of comparing the choices of the two siblings. Identical twins share the same genetic composition, while fraternal twins have half in common. If pairs of identical twins make more similar choices, such as starting a business, than pairs of fraternal twins, then genetics must affect the choices, as long as a few scientific assumptions hold. In the molecular genetics research, we examine the different versions of genes people have and see if entrepreneurs are statistically more likely to have one version over another.

There are probably many ways genes influence whether or not we become entrepreneurs, but in the twins research, we have found initial evidence that one route clearly is through our personalities. The same genes that affect whether we are extroverted, open to experience, disagreeable and sensation seeking also influence our decision to start our own business. Furthermore, the same genes that influence the tendency to be open to experience also affect the tendency to identify new business opportunities.

Before you start worrying that this research will usher in the world portrayed in the science- fiction thriller Gattaca, we are a long, long way from any practical application of these findings. That will come only after many years of replicating the findings.

Moreover, there's no single gene or even set of genes for entrepreneurship. Our genes influence broader categories of behavior, such as whether we do things that involve a great deal or small amount of novelty. While entrepreneurship might involve pursuing novelty, so do many other human activities.

Further complicating the issue, hundreds of genes probably influence whether or not we become entrepreneurs. Thus far in the molecular genetics research, we've found initial evidence for just one of them--a version of a gene for a receptor for the brain chemical dopamine.

Geneticists have speculated that sensation-seeking people have versions of dopamine receptor genes that require more stimulating experiences in order to produce a given amount of dopamine in the brain. To get the higher level of stimulation, those people are more likely to engage in sensation seeking activities, including starting businesses.

While your genes influence whether or not you become an entrepreneur, experience matters, too. Genes don't determine anything you do; they merely influence what you do in the same way your life experiences do. Just as receiving a financial windfall increases your odds of starting a business, so too does having a particular genetic makeup. But just as some people without a penny to their name start companies, so too can people without the genetic make-up associated with entrepreneurship.

While the research so far is limited, it does mean that when you describe someone as a born entrepreneur, you really are onto something.

Understanding the Value of a Facebook Fan

If you're like most of the marketers or business owners I talk with these days, you're wondering what exactly are the benefits of Facebook fans (i.e., "Likes") to your brand. Also, how much more likely are they to do business with you than those who don't "like" you on Facebook?

Those who profess to be fans are much more likely to participate in "desirable actions" using Facebook, such as making a purchase, installing an app, entering a sweepstakes or voting online in a contest. That's according to SocialCode, a full-service social agency owned by the Washington Post Company, which looked at 50 brands and more than 5 million Facebook ads over a five-month period earlier this year.

Of course, it should come as little surprise that fans are more likely to perform desirable acts than nonfans. But the knowledge that they do so at a situational rate of up to 547 percent higher than nonfans is eye opening.

Specifically, the survey shows that Facebook fans are 291 percent more likely to engage with brands than nonfans. For example, the fan conversion rate to install an app is 38 percent compared with 12 percent for nonfans. That's a 239 percent difference, or, in other words, fans are three times more likely to convert than nonfans. The conversion rate for existing or new fans to enter a brand's contest was found to be 6 percent as opposed to 1 percent for nonfans -- a 545 percent differential.

When it comes to making an actual purchase, the SocialCode survey shows that fans do so at a 7 percent rate, while nonfans buy at a rate of just 2 percent.

Among the seven actions a user might perform on a fan page, SocialCode found that the difference in cost per acquisition, or CPA, between fans and nonfans is $9.56. That number is calculated by dividing the total cost of clicks by the total number of actions. For fans who install an app, for instance, the cost per acquisition is $2.61 compared to $8.49 for nonfans. Similarly, for fans making a purchase, the fan CPA is $14.88 compared to a nonfan CPA of $43.86.

Others costs include: contest submissions ($17.21 for fans, $76.25 for nonfans); contest voting ($3.26 for fans, $21.09 for nonfans); fan acquisition ($3.39 for fans, $5.17 for nonfans); program signup ($41.25 for fans, $75.90 for nonfans); and sweepstakes entry ($2.57 for fans, $5.81 for nonfans.)

In Facebook fan studies from last year, the value of a fan ranged from $3.60 in a Vitrue survey to $136.38 in a Syncapse assessment. Problems I see with the SocialCode survey is the assumption that all of these fans engage in actions to the same degree and that these desired actions can be weighed the same. I would think, for instance, that a purchase "action" would trump a contest vote every time. Similarly, the value of a fan should be measured by how much money he or she is bringing to the table in the form of purchases made, with the cost per action subtracted from that figure. The bottom line: How much more did we sell to the folks who signed on as our fans?

Networking Strategies for the Holidays

Holiday parties mean much more than free food and fun. They also can bring entrepreneurs a host of new opportunities to network and build relationships.

Most people think of networking only through the traditional venues, whether chamber of commerce events, business contact referral groups, or online sites such as LinkedIn. But holiday parties, including professional and industry social events where you can network with people outside your business, can be an even better time to introduce yourself to a new contact or share a friendly conversation with someone you already know.


To make the most of holiday party networking, here are a few things to keep in mind:

Be prepared. Try to learn in advance the names of people you will likely chat with, their jobs and their recent accomplishments. You will need to do a little homework, perhaps a Google search and a look at their LinkedIn or Facebook pages. Use the information you glean to break the ice.

Ask good questions. From the CEO to intern level, people love to talk about themselves. Here are some suggested conversation starters: How did you get started? What were some of the challenges with. . . ? Have you read any good books lately? My favorite is: How can I help you?

Have a "teaser” topic ready. Approaching the end of the year, every business executive is thinking about how to increase profits and performance in the new year. Have an idea ready that describes the steps you'd take to improve your networking contact's business. Make this research part of the homework you do ahead of time. But don't give away the goose; save the details for a later conversation.
Don't have more than a couple of drinks. It's a party, but you don't want to smell of liquor or be too relaxed when you approach people you want to connect with. Impressions count. Make the right one.
Be confident of your value. Introducing yourself to an executive can be an intimidating experience, so give yourself a pep talk before the party. Make a list of your accomplishments over the past year and figure out how you might weave them into conversations. Once you've got that down, you should feel good about yourself.
Use the introduction to segue to a future meeting. You don't want to end your chat at the party. The endgame here is to open the door for a follow-up meeting one-to-one. But remember that a party is a social gathering, so keep it natural and leave them intrigued.

Honor the event. This is really important. Make sure that when networking at a holiday party -- or any nontraditional networking event for that matter -- you don't treat it like a business mixer. Show finesse. Yes, it is a great networking opportunity, but if you overtly sell, you may turn people off. After all, it is a holiday.

12 Ways to (Legally) Spy on Your Competitors

Ever wonder what your competitors are up to? You should. They might be creating new products, planning to enter new markets -- or maybe they're floundering. If you knew, it could give you an edge. Uncovering competitive information doesn't require donning a trench coat or hiring a computer hacker. There are plenty of perfectly legal ways to get below-the-radar competitive information. Here are some time-tested methods that predate the Internet, as well as newer techniques to mine the wealth of information readily accessible online.

1. Read the local papers. Subscribe to the daily newspaper and business weekly in the cities where your primary competitors are based. You'll be surprised what competitors might say when they think they're just talking to a small, local audience.

"I cannot tell you the information we've gotten this way, in regular articles, about inventory, staffing, new plants and expansion plans," says Seena Sharp, Los Angeles-based principal atSharp Market Intelligence. For instance, one of Sharp's clients in the garden-products industry learned exactly how a plant fire had affected a competitor, the capacity of the rebuilt plant and the marketing plan for the next year, all from a local newspaper. With this knowledge, the client crafted a strategy that countered the competitor's efforts and increased the client's market share.

2. Tap your vendors. Product suppliers and service providers talk regularly with all their clients. If you're on good terms with your vendors, Sharp says, chat them up and see what you can get them to spill about your competitors. Don't be pushy, though. Keep the conversation casual.

3. Go to trade shows. You can stand near competitors' booths at a busy time when it's easy to blend in with the crowd and eavesdrop on what they tell prospects. New initiatives often are announced at shows, Sharp notes and chatty salespeople may reveal details. If you think you'll be recognized, send an employee or friend to listen.

4. Take a plant tour. For manufacturing competitors, see if the plant gives tours. Sharp says tour guides often brag about new products, new hires and expansion plans.

5. Play secret shopper. If competitors have stores, stroll the aisles and observe whether employees are responsive and facilities are clean--or shelves are empty and store phones go unanswered. Call the order line, too, so you can evaluate customer service, advises Sean Campbell, principal at competitive-research firm Cascade Insights in Oregon City, Ore.

6. Browse public documents. Publicly held companies must file reports with the U.S. Securities and Exchange Commission. Sharp also likes to read filings with the Environmental Protection Agency, the Patent and Trademark Office and local planning commissions to learn of building expansions and new products. Check with other state and federal agencies for signs of trouble such as tax liens, and comb legal filings for unexpected disclosures.

7. Google your competitor's website. You can reveal hidden pages by doing Google searches such as: "filetype: doc site: companyname," says August Jackson, a senior competitive intelligence analyst for Ernst & Young in McLean, Va. http://www.ey.com/ Change the file type to .pdf, .xls, or .ppt to turn up data or presentations. "It's surprising how many companies put this information up and think, ‘If I don't link to it, no one will find it,'" Jackson says. You also can view the site's source code to see the meta-tags or key words being used to optimize its position in searches.

8. Explore LinkedIn. On LinkedIn, you can sign up to follow a company and get notices when updates are posted on its LinkedIn page. You also can search a company's name on LinkedIn to find former employees and new hires, Jackson says. Salespeople may identify and brag about their clients on their personal LinkedIn page updates. If you're worried the company might recognize and block you, ask a colleague to follow the page.

9. Troll Twitter and Facebook chatter. If members of your industry hang out on Facebook, monitor their conversations. Music-rights agent Jennifer Yeko, president of True Talent Management in Beverly Hills, Calif., says she gets the scoop on the clients her competitors sign and the royalty rates they offer from posts made by her Facebook friends.

Many events have a Twitter hashtag that people use to chat and post speakers' comments live. If a competitor is speaking, tune in. Jackson has had success asking follow-up questions by responding and using the same hashtag.

10. Find competitors' job ads. Job portal Indeed is a great place for sussing out postings because it aggregates listings from many online job boards. Watch the skills a company may be hiring for; they're a leading indicator for new initiatives, says Campbell of Cascade Insights.

"We had a client curious about which American wireless carriers would offer Android phones," he says. "Just looking at job listings you could see who was trying to hire people with Android experience."

11. See Who's on Quora. Popular with techies and venture capitalists, Quora holds a vast database of interesting competitive questions on such topics as a company's future plans. Often, company employees provide the answers, Campbell notes, and they generally reply using their true identities, unlike people on most Q&A sites.

12. Check Slideshare. Companies frequently use this popular portal to share slideshow presentations but forget to take them down, Jackson says. Presentations to potential investors, for example, may contain financial data, forecasts and information about new projects.

One note of warning: When researching online, be sure to consider the source. There are plenty of half-truths, gossip and misinformation online.