Mistakes Can Explain 'Cooperative' Behavior

How people behave in economic games, where they can choose to be selfish or cooperative, can be explained more easily by 'mistakes' than wanting others to succeed.

he finding comes from four new experiments carried out by researchers from Oxford University, Edinburgh University, and the University of Lausanne, Switzerland. A report of the research was recently published in PNAS.

In the four experiments 168 people played games in groups of four where they were able to choose how many of 40 monetary units they wished to contribute to a public project. Players were then rewarded according to the premium put on cooperative behaviour (contributing) as opposed to holding onto their 'money'.

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What we found was that even as we increased the premium on cooperation, so that players made most money by contributing 100 per cent of their money, on average people contributed significantly less than 100 per cent,' said Professor Stuart West of Oxford University's Department of Zoology, one of the leaders of the study. 'In fact even when full cooperation delivered the best financial returns between 66 and 94 per cent of people still saw fellow players as their competitors.'

The research shows that mistakes or 'imperfect behaviour' made by players in a game setting can lead to a systematic bias in how much or little they cooperate.

'Our results suggest that players avoid both completely 'selfish' and 'fully cooperative' behaviour, even if one of these strategies delivers maximum benefit,' said Professor West. 'This could derive from a psychology that avoids extreme behaviours, which could be very costly if they go wrong, or indicate that the sort of simple everyday rules of thumb we use to make these kind of judgements 'misfire' in an intense experimental setting.'

The findings have important implications for evolutionary theory as they challenge the need for new evolutionary theories (such as 'strong reciprocity') to explain how such seemingly 'altruistic' behaviour could have evolved.

http://www.sciencedaily.com/releases/2010/05/100521205753.htm

The 25 Most Common Mistakes in Email Security

PROPERLY MANAGING YOUR EMAIL ACCOUNTS

1. Using just one email account.

Individuals new to email often think about their email account like they do their home address, you only have one home address, so you should only have one email. Instead, you should think about your email address like you do your keys; while it may be OK to use the same key for your front and your back door, having a single key open everything is both impractical and unsafe.

A good rule of thumb for the average email user is to keep a minimum of three email accounts. Your work account should be used exclusively for work-related conversations. Your second email account should be used for personal conversations and contacts, and your third email account should be used as a general catch-all for all hazardous behavior. That means that you should always sign up for newsletters and contests only through your third email account. Similarly, if you have to post your email account online, such as for your personal blog, you should only use your third email account (and post a web friendly form of it at that).

While your first and second email accounts can be paid or freebie, your third 'catch-all' account should always be a freebie account such as those offered by Gmail or Yahoo!. You should plan on having to dump and change out this account every six months, as the catch-all account will eventually become spammed when a newsletter manager decides to sell your name or a spammer steals your email address off a Web site.

2. Holding onto spammed-out accounts too long.

It is simply a fact of life that email accounts will accumulate spam over time. This is especially true of the account you use to sign up for newsletters and that you post online (which as stated above should not be your main email account). When this happens, it is best to simply dump the email account and start afresh. Unfortunately, however, many new email users get very attached to their email accounts and instead just wade through dozens of pieces of spam every day. To avoid the problem, prepare yourself mentally ahead of time for the idea that you will have to dump your 'catch all' account every six months.

3. Not closing the browser after logging out.

When you are checking your email at a library or cybercafé you not only need to log out of your email when you are done, but you also need to make sure to close the browser window completely. Some email services display your username (but not your password) even after you have logged out. While the service does this for your convenience, it compromises your email security.

4. Forgetting to delete browser cache, history and passwords.

After using a public terminal, it is important that you remember to delete the browser cache, history, and passwords. Most browsers automatically keep track of all the web pages that you have visited, and some keep track of any passwords and personal information that you enter in order to help you fill out similar forms in the future.

If this information falls into the wrong hands, it can lead to identity theft and stolen bank and email information. Because the stakes are so high, it is important that new internet users be aware of how to clear a public computers browser cache so that they can delete private information before lurking hackers can get a hold of it.

For those of you using Mozilla's Firefox, simply press Ctrl+Shift+Del. Operausers need go to Tools>>Delete Private Data. And users of Microsoft'sInternet Explorer need to go to Tools>>Internet Options then click the 'Clear History', 'Delete Cookies', and 'Delete Files' buttons.

5. Using unsecure email accounts to send and receive sensitive corporate information.

Large corporations invest huge amounts of money to ensure that their computer networks and email remain secure. Despite their efforts, careless employees using personal email accounts to conduct company business and pass along sensitive data can undermine the security measures in place. So make sure that you don't risk your company's security, and your job, by transmitting sensitive company data via your own personal computer or email address.

6. Forgetting the telephone option

One of the most important lessons about email security is that no matter how many steps you take to secure your email, it will never be foolproof. This is never truer than when using a public computer. So unless you need a written record of something or are communicating across the globe, consider whether a simple phone call rather than an email is a better option. While a phone conversation may require a few extra minutes, when compared with accessing email through a public computer, a phone call is a far more secure option and it does not leave a paper trail.

EMAILING THE RIGHT PEOPLE

7. Not using the Blind Carbon Copy (BCC) option.

When you put a person's email addresses in the BCC: rather than the CC: window, none of the recipients can see the addresses of the other email recipients.

New email users often rely too much on the TO: because it is the default way of sending emails. That is fine as long as you are writing to just one person or a few family members. But if you are sending mail out to a diverse group of people, confusing BCC: and CC: raises some serious privacy and security concerns. It takes just one spammer to get a hold of the email and immediately everyone on your email list gets spammed.

Even if the honesty of the group isn't in question, many email programs are setup to automatically add to the address books any incoming email addresses. That means that some people in the group will inadvertently have added the entire list to their address book, and as a result, if one of their computers is infected with "Zombie" malware and silently sends out spam emails, you will have just caused the entire list to get spammed.

8. Being trigger happy with the "Reply All" button.

Sometimes the mistake isn't in deciding between CC: and BCC: but between hitting Reply All instead of Reply. When you hit Reply All, your email message is sent to everyone included on the original email, and if you didn't intend to include them, the information can be disastrous from both a security and personal humiliation perspective:

Example 1: "A very successful salesman at our networking company had a large email address book filled with his best customers, including some very important and conservative government contacts. With a single click, he accidentally sent a file chock-full of his favorite pornographic cartoons and jokes to everyone on his special customer list. His subject line: 'Special deals for my best customers!' Needless to say, he's cutting deals for another company these days."

Example 2: "A woman was in torment over a busted romance. She wrote a lengthy, detailed message to a girlfriend, adding that her ex-boyfriend preferred men to women. But instead of hitting Reply to a previous message from her girlfriend, she hit Reply All. Her secret was sent to dozens of people she didn't even know (including me), plus the aforementioned ex and his new boyfriend. As if that weren't bad enough, she did this two more times in quick succession!

9. Spamming as a result of forwarding email.

Forwarding emails can be a great way to quickly bring someone up to speed on a subject without having to write up a summary email, but if you aren't careful, forwarding emails can create a significant security threat for yourself and the earlier recipients of the email. As an email is forwarded, the recipients of the mail (until that point in time) are automatically listed in the body of the email. As the chain keeps moving forward, more and more recipient ids are placed on the list.

Unfortunately, if a spammer or someone just looking to make a quick buck gets a hold of the email, they can then sell the entire list of email ids and then everyone will start to get spammed. It only takes a few seconds to delete all the previous recipient ids before forwarding a piece of mail, and it can avoid the terrible situation of you being the cause of all your friends or coworkers getting spammed.

MAKING BACKUPS AND KEEPING RECORDS

10. Failing to back up emails.

Emails are not just for idle chatting, but can also be used to make legally binding contracts, major financial decisions, and conduct professional meetings. Just as you would keep a hard copy of other important business and personal documents, it is important that you regularly back up your email to preserve a record if your email client crashes and loses data (It happened to Gmail as recently as December 2006).

Thankfully, most email providers make it rather simple to back up your email by allowing you to export emails to a particular folder and then just creating a copy of the folder and storing it onto a writeable CD, DVD, removable disk, or any other type of media. If that simple exporting process sounds too complicated, you can just buy automated backup software that will take care of the whole thing for you. Whether you purchase the software or decide to back up manually, it is important that you make and follow a regular backup schedule, as this is the sort of thing that new email users tend to just put off. The frequency of backups necessary for you will of course depend on your email usage, but under no circumstances should it be done less frequently than every 3 months.

11. Mobile access: Presuming a backup exists.

Mobile email access, such as through BlackBerry, has revolutionized the way we think about email; no longer is it tied to a PC, but rather it can be checked on-the-go anywhere. Most new BlackBerry users simply assume that a copy of the emails they check and delete off the BlackBerry will still be available on their home or office computer.

It is important to keep in mind, however, that some email servers and client software download emails to the Blackberry device and then delete them from the server. Thus, for some mobile email access devices, if you delete it from the device, you have deleted it from your Inbox.

Just be aware of the default settings of your email client and make sure that if you want a copy of the email retained, you have adjusted the email client's settings to make it happen. And preferably make sure of this before you decide to delete that important email.

12. Thinking that an erased email is gone forever.

We've all sent an embarrassing or unfortunate email and sighed relief when it was finally deleted, thinking the whole episode was behind us. Think again. Just because you delete an email message from your inbox and the sender deletes it from their 'Sent' inbox, does not mean that the email is lost forever. In fact, messages that are deleted often still exist in backup folders on remote servers for years, and can be retrieved by skilled professionals.

So start to think of what you write in an email as a permanent document. Be careful about what you put into writing, because it can come back to haunt you many years after you assumed it was gone forever.

AVOIDING FRAUDULENT EMAIL

13. Believing you won the lottery … and other scam titles.

Spammers use a wide variety of clever titles to get you to open emails which they fill with all sorts of bad things. New email users often make the mistake of opening these emails. So in an effort to bring you up to speed, let me tell you quickly:

·                          You have not won the Irish Lotto, the Yahoo Lottery, or any other big cash prize.

·                          There is no actual Nigerian King or Prince trying to send you $10 million.

·                          Your Bank Account Details do not need to be reconfirmed immediately.

·                          You do not have an unclaimed inheritance.

·                          You never actually sent that "Returned Mail".

·                          The News Headline email is not just someone informing you about the daily news.

·                          You have not won an iPod Nano.

14. Not recognizing phishing attacks in email content.

While never opening a phishing email is the best way to secure your computer, even the most experienced email user will occasionally accidentally open up a phishing email. At this point, the key to limiting your damage is recognizing the phishing email for what it is.

Phishing is a type of online fraud wherein the sender of the email tries to trick you into giving out personal passwords or banking information. The sender will typically steal the logo from a well-known bank or PayPal and try to format the email to look like it comes from the bank. Usually the phishing email asks for you to click on a link in order to confirm your banking information or password, but it may just ask you to reply to the email with your personal information.

Whatever form the phishing attempt takes, the goal is to fool you into entering your information into something which appears to be safe and secure, but in fact is just a dummy site set up by the scammer. If you provide the phisher with personal information, he will use that information to try to steal your identity and your money.

Signs of phishing include:

·                          A logo that looks distorted or stretched.

·                          Email that refers to you as "Dear Customer" or "Dear User" rather than including your actual name.

·                          Email that warns you that an account of yours will be shut down unless you reconfirm your billing information immediately.

·                          An email threatening legal action.

·                          Email which comes from an account similar, but different from, the one the company usually uses.

·                          An email that claims 'Security Compromises' or 'Security Threats' and requires immediate action.

If you suspect that an email is a phishing attempt, the best defense is to never open the email in the first place. But assuming you have already opened it, do not reply or click on the link in the email. If you want to verify the message, manually type in the URL of the company into your browser instead of clicking on the embedded link.

15. Sending personal and financial information via email.

Banks and online stores provide, almost without exception, a secured section on their website where you can input your personal and financial information. They do this precisely because email, no matter how well protected, is more easily hacked than well secured sites. Consequently, you should avoid writing to your bank via email and consider any online store that requests that you send them private information via email suspect.

This same rule of avoiding placing financial information in emails to online businesses also holds true for personal emails. If, for example, you need to give your credit card information to your college student child, it is far more secure to do so over the phone than via email.

16. Unsubscribing to newsletters you never subscribed to.

A common technique used by spammers is to send out thousands of fake newsletters from organizations with an "unsubscribe" link on the bottom of the newsletter. Email users who then enter their email into the supposed "unsubscribe" list are then sent loads of spam. So if you don't specifically remember subscribing to the newsletter, you are better off just blacklisting the email address, rather than following the link and possibly picking up aTrojan horse or unknowingly signing yourself up for yet more spam.

AVOIDING MALWARE

17. Trusting your friends email.

Most new internet users are very careful when it comes to emails from senders they don't recognize. But when a friend sends an email, all caution goes out the window as they just assume it is safe because they know that the sender wouldn't intend to hurt them. The truth is, an email from a friend's ID is just as likely to contain a virus or malware as a stranger's. The reason is that most malware is circulated by people who have no idea they are sending it, because hackers are using their computer as a zombie.

It is important to maintain and keep updated email scanning and Anti-virus software, and to use it to scan ALL incoming emails.

18. Deleting spam instead of blacklisting it.

An email blacklist is a user created list of email accounts that are labeled as spammers. When you 'blacklist' an email sender, you tell your email client to stop trusting emails from this particular sender and to start assuming that they are spam.

Unfortunately, new internet users are often timid to use the blacklist feature on their email client, and instead just delete spam emails. While not every piece of spam is from repeat senders, a surprising amount of it is. So by training yourself to hit the blacklist button instead of the delete button when confronted with spam, you can, in the course of a few months, drastically limit the amount of spam that reaches your Inbox.

19. Disabling the email spam filter.

New email users typically do not start out with a lot of spam in their email account and thus do not value the help that an email spam filter can provide at the beginning of their email usage. Because no spam filter is perfect, initially the hassle of having to look through one's spam box looking for wrongly blocked emails leads many new email users to instead just disable their email spam filter altogether.

However, as an email account gets older it tends to pick up more spam, and without the spam filter an email account can quickly become unwieldy. So instead of disabling their filter early on, new internet users should take the time to whitelist emails from friends that get caught up in the spam filter. Then, when the levels of spam start to pick up, the email account will remain useful and fewer and fewer friends will get caught up in the filter.

20. Failing to scan all email attachments.

Nine out of every ten viruses that infect a computer reach it through an email attachment. Yet despite this ratio, many people still do not scan all incoming email attachments. Maybe it is our experience with snail mail, but often when we see an email with an attachment from someone we know, we just assume that the mail and its attachment are safe. Of course that assumption is wrong, as most email viruses are sent by 'Zombies' which have infected a computer and caused it to send out viruses without the owner even knowing.

What makes this oversight even more scandalous is the fact that a number of free email clients provide an email attachment scanner built-in. For example, if you use Gmail or Yahoo! for your email, every email and attachment you send or receive is automatically scanned. So if you do not want to invest in a third-party scanner and your email provider does not provide attachment scanning built-in, you should access your attachments through an email provider that offers free virus scanning by first forwarding your attachments to that account before opening them.

KEEPING HACKERS AT BAY

21. Sharing your account information with others.

We've all done it – we need an urgent mail checked, and we call up our spouse or friend and request them to check our email on our behalf. Of course, we trust these people, but once the password is known to anybody other than you, your account is no longer as secure as it was.

The real problem is that your friend might not use the same security measures that you do. Your friend might be accessing his email through an unsecured wireless account, he may not keep his anti-virus software up to date, or he might be infected with a keylogger virus that automatically steals your password once he enters it. So ensure that you are the only person that knows your personal access information, and if you write it down, make sure to do so in a way that outsiders won't be able to understand easily what they are looking at if they happen to find your records.

22. Using simple and easy-to-guess passwords.

Hackers use computer programs that scroll through common names to compile possible user names, and then send spam emails to those usernames. When you open that spam email, a little hidden piece of code in the email sends a message back to the hacker letting him know that the account is valid, at which point they turn to the task of trying to guess your password.

Hackers often create programs which cycle through common English words and number combinations in order to try to guess a password. As a consequence, passwords that consist of a single word, a name, or a date are frequently "guessed" by hackers. So when creating a password use uncommon number and letter combinations which do not form a word found in a dictionary. A strong password should have a minimum of eight characters, be as meaningless as possible, as well as use both upper and lowercase letters. Creating a tough password means that the hacker's computer program will have to scroll through tens of thousands of options before guessing your password, and in that time most hackers simply give up.

23. Failing to encrypt your important emails.

No matter how many steps you take to minimize the chance that your email is being monitored by hackers, you should always assume that someone else is watching whatever comes in and out of your computer. Given this assumption, it is important to encrypt your emails to make sure that if someone is monitoring your account, at least they can't understand what you're saying.

While there are some top-of-the-line email encryption services for those with a big budget, if you are new to email and just want a simple and cheap but effective solution, you can follow these step-by-step 20 minute instructions to install PGP, the most common email encryption standard. Encrypting all your email may be unrealistic, but some mail is too sensitive to send in the clear, and for those emails, PGP is an important email security step.

24. Not encrypting your wireless connection.

While encrypting your important emails makes it hard for hackers who have access to your email to understand what they say, it is even better to keep hackers from getting access to your emails in the first place.

One of the most vulnerable points in an emails trip from you to the email recipient is the point between your laptop and the wireless router that you use to connect to the internet. Consequently, it is important that you encrypt yourwifi network with the WPA2 encryption standard. The upgrade process is relatively simple and straightforward, even for the newest internet user, and the fifteen minutes it takes are well worth the step up in email security.

25. Failing to use digital signatures.

The law now recognizes email as an important form of communication for major undertakings such as signing a contract or entering into a financial agreement. While the ability to enter into these contracts online has made all of our lives easier, it has also created the added concern of someone forging your emails and entering into agreements on your behalf without your consent.

One way to combat email forgery is to use a digital signature whenever you sign an important email. A digital signature will help prove who and from what computer an email comes from, and that the email has not been altered in transit. By establishing the habit of using an email signature whenever you sign important emails, you will not only make it harder for the other party to those agreements to try to modify the email when they want to get out of it, but it will also give you extra credibility when someone tries to claim that you have agreed to a contract via email that you never did.

For a quick primer on digital signatures, you can read YoudZone andWikipedia's articles on the subject.

This article is intended to provide you with the basic information you need to avoid many of the email security pitfalls that frequently trip up new email users. While no single article can cover even the basics of email security, avoiding the 25 common mistakes listed in this article will make a dramatic difference in improving the safety and security of your computer, your personal information, and your emails.

http://www.itsecurity.com/features/25-common-email-security-mistakes-022807/

8 Mistakes To Avoid When Naming Your Business

Naming a business is a lot like laying the cornerstone of a building. Once it's in place, the entire foundation and structure is aligned to that original stone. If it's off, even just a bit, the rest of the building is off, and the misalignment becomes amplified. So if you have that gnawing sense that choosing a name for your new business is vitally important, you're right. With 18 years experience in the naming and branding business, I've witnessed the good, the bad and the really bad. To help you get off to a good start, read on to discoverthe top 8 mistakes I've found people make when it comes to choosing a name for their business:

Mistake #1: Getting the "committee" involved in your decision. We live in a democratic society, and it seems like the right thing to do--to involve everyone (your friends, family, employees and clients) in an important decision. This approach, however, presents a few problems. The first and most obvious fact is that you'll end up choosing only one name, so you risk alienating the very people you're trying to involve. Second, you often end up with a consensus decision, which results in a very safe, very vanilla name. A better method is to involve only the key decision-makers--the fewer the better--and select only the people you feel have the company's best interests at heart. The need for personal recognition can skew results, so you'll be best served by those who can park their egos at the door. Also make sure you have some right-brain types in the mix. Get too many left brains on board, and your name will most likely end up too literal and descriptive.

Mistake #2: Employing the "train wreck" method of creating a name.When forced to come up with a catchy name, many aspiring entrepreneurs simply take part of an adjective and weld it onto a noun, essentially colliding the two words head on to create a new word. The results are names that have a certain twisted rationale to them, but look and sound awful. Someone starting a high-end, service franchise becomes QualiServe. Someone starting a classy day spa becomes TranquiSpa. It's a bit like mixing chocolate syrup with ketchup--there's nothing wrong with either ingredient, but they just don't go together. Other common truncations include Ameri, Tech, Corp and Tron. The problem with this approach is that it's simply forced--and it sounds that way.

Mistake #3: Using words so plain they'll never stand out in a crowd.The first company in a category can get away with this one. Hence you have General Motors, General Electric and so on. But once you have competition, it requires differentiation. Imagine if Yahoo! had come out as GeneralInternetDirectory.com? The name would be much more descriptive but hardly memorable. And with the onslaught of new media and advertising channels, it's more important than ever to carve out your niche by displaying your uniqueness. Nothing does that better than a well conceived name.

Mistake #4: Taking the atlas approach and using a map to name your company. In the zeal to start a new company, many businesses choose to use their city, state or region as part of their company name. While this may actually help in the beginning, it often becomes a hindrance as a company grows. One client came to me with complaints that he was serving more of the market than his name implied. He had aptly called his business St. Pete Plumbing since he hailed from St. Petersburg, Florida. But Yellow Page shoppers assumed that was also his entire service area. With a little creative tinkering, we changed the image of St. Pete from a city to St. Peter himself, complete with wings and a plumber's wrench. The new tagline? "We work miracles!"

Many other companies have struggled with the same issue. Minnesota Manufacturing and Mining was growing beyond their industry and their state. To avoid limiting their growth, they became 3M, a company now known for innovation. Kentucky Fried Chicken is now KFC, de-emphasizing the regional nature of the original name. Both of these companies made strategic moves to avoid stifling their growth. Learn from them, and you can avoid this potential bottleneck from the beginning.

Mistake #5: Turning your name into a cliche. Once past the literal, descriptive word choices, your thought process will most likely turn to metaphors. These can be great if they're not overly used to the point of being trite. For example, since many companies think of themselves as the top in their industry, the world is full of names like Summit, Apex, Pinnacle, Peak and so on. While there's nothing inherently wrong with these names, they're overworked. Instead, look for combinations of positive words and metaphors, and you'll be much better served. A good example is the data storage company Iron Mountain, a name that conveys strength and security without sounding commonplace.

Mistake #6: Making your business name so obscure, customers will never know what it means. It's great for a name to have a special meaning or significance--it's sets up a story that can be used to tell the company message. But if the reference is too obscure or too hard to spell and pronounce, you may never have the opportunity to speak to that customer because they'll simply pass you by as irrelevant.

So resist the urge to name your company after the mythical Greek god of fast service or the Latin phrase for "We're number one!" If a name has a natural, intuitive sound and a special meaning, it can work. If it's too complex and puzzling, it will remain a mystery to your customers. This is especially true if you're reaching out to a mass audience.

I pushed the envelope a little on this one myself, naming my branding firm Tungsten after the metal that Thomas Edison used to create light. But because my clients consist of knowledgeable professionals who appreciate a good metaphor and expect a branding firm to have a story behind its name, I knew it would work. It's also a way to differentiate my services--illuminated, bright, and brilliant. But while something different might work for a branding firm, it wouldn't work as well for more common businesses, like an ice cream parlor or an auto body shop.

Mistake #7: Taking the Campbell's soup approach to selecting a name.Driven by the need for a matching domain name, many companies have resorted to awkwardly constructed or purposefully misspelled names. The results are company names that sound more like prescription drugs than real life businesses. Mistake #2 sometimes gets combined with this one and results in a name like KwaliTronix. It's amazing how good some names begin to sound after searching for available domain names all night. But resist the urge. Avoid using a "K" in place of a "Q" or a "Ph" in place of an "F". This makes spelling the name--and locating you on the internet--all that much harder.

And it's not that coined or invented names can't work--they often do. Take, for example, Xerox or Kodak. But keep it mind that names like these have no intrinsic or linguistic meaning, so they rely heavily on advertising to convey their meaning--and that gets expensive. Many of the companies that successfully use this approach were either first in their category or have large marketing budgets. Verizon, for instance, spent millions on their rebranding effort. So did Accenture. So check your pocketbook before you check into these types of names.

Mistake #8: Choosing the wrong name and then refusing to change it.Many business owners know they have a problem with their name and just hope it will somehow magically resolve itself. The original company name of one of my clients, for instance, was "Portables", which reminded some people of port-a-potties or portable classrooms--neither was accurate nor something the business owner wanted to be associated with. This added to the confusion when sales reps tried to explain their new concept of moving and storage. After some careful tweaking, we came up with the name PODS, an acronym for Portable On Demand Storage. The rest is quickly becoming history as they expand both nationally and internationally.

Mike Harper of Huntington Beach, California, bought a 30-year old janitorial and building maintenance company named Regency. We both agreed it sounded more like a downtown movie theatre than a progressive facilities management firm. After a thorough naming search, we developed the name Spruce Facilities Management. Spruce not only conveyed the environmentally friendly image of a spruce tree, something important to the client, it also meant "to clean up." The new tagline fell right in place: Spruce..."The Everclean Company."

It's only a matter of time before Southwest Airlines, Burlington Coat Factory and others who have successfully outgrown their original markets begin to question their positioning. Much like 3M and KFC, they may need to make a change to keep pace with their growth and image.

In the fever to start your new business or expand a current one, take time to think through some of these issues. By tapping into your creativity and avoiding these potential pitfalls, you'll be able to create a name that works for both the short and long term. Like the original cornerstone of a building, it will support upward expansion as your company reaches new heights.

---

Phil Davis founded and ran a full-service ad agency for over 17 years before launching his business naming and branding consulting company in Asheville, North Carolina. His work can be viewed at http://PureTungsten.com.

http://www.entrepreneur.com/startingabusiness/startupbasics/namingyourbusiness/article76958.html

The 6 Biggest Mistakes in Raising Startup Capital

In the movie Little Fish, a video store manager played by Cate Blanchett applies for a bank loan to buy the business and expand into online gaming. When her application is rejected, Blanchett hurls a framed photo of the loan officer's child across the room in fury. Anyone who's suffered a similar setback knows the feeling.

The business landscape is littered with would-be entrepreneurs who've stumbled in their search for startup capital. Many requests are denied. Those who pass the test frequently have unacceptable strings attached. Some deals that close come back to bite the business owner in the form of onerous debt, insufficient revenue share or worse.

Part of the problem lies in the nature of the startup endeavor. Freshly minted entrepreneurs are typically major risks for lenders because they lack business experience, collateral to secure the loan or both. Neither family, friends, banks, venture capital firms nor angel investors are interested in losing their investment. You can't blame them for not wanting to take a risk on a venture without a reasonable probability of return.

On the other hand, many financing efforts fail because of avoidable mistakes that are made in pitching potential lenders, structuring the agreement or managing the money once the deal is done.

Steering clear of these missteps can increase your chances of success, both in obtaining startup funds and keeping the money flowing. Be sure to avoid these blunders:

1. Half-baked business plans-- There's nothing worse than going into a money meeting unprepared. If you haven't put the time and energy into writing a full-blown business plan complete with elements, such as a cogent business description, financial projections and a competitive market analysis, the people with the cash won't put the time into evaluating your proposal.

The SBA is a good source for learning how to write a business plan as well as sample formats.

2. Focusing too much on the idea and too little on the management--It's not enough to convince potential backers that you've invented the next must-have gadget or can't-miss clothing store concept. You also need a team that can generate the revenues to repay a bank loan or provide an exit strategy for a VC or angel investor. Many business novices ignore the second part of the equation; that can doom their money quest.

The greatest racehorse in the world still needs a great jockey to a win a race. The same principle applies in business. Showing that you have recruited a top-notch salesperson, a skilled marketer, an accountant with startup experience, other key personnel, and even outside experts like an attorney or business coach who can supply professional guidance is essential to finding a funding source.

3. Not asking for enough money-- In a 2004 U.S. Bank study of reasons for small business failures, 79 percent cited "starting out with too little money" as one of the causes of their collapse. That's often because entrepreneurs who are wet behind the ears don't realize that they should calculate their borrowing needs based on their worst-case scenario instead of their best-case forecast.

An old accounting axiom says that everything will take twice as long and cost twice as much as you expect. While that may be an exaggeration, new business owners are frequently too optimistic about how soon they will begin to fill their cash pipeline and how fast the money will flow. If you're underfunded, you won't have a cushion to tide you over in the event of slow initial sales or unexpected market conditions.

4. Having too many lenders or investors-- One of the hazards of securing financing from multiple sources is managing too many relationships and expectations. It takes time away from your core business. These not-so-silent partners may have conflicting interests or demands and the consequences can be devastating.

This is particularly true when you raise money from friends and family. One hairdresser I know borrowed money from seven or eight relatives to open her own salon. The business was successful, but there were perpetual battles over how the profits should be distributed. The arguments couldn't be settled to everyone's satisfaction, so the salon was forced to close.

5. Failing to get the proper legal agreements-- This is arguably more important than a prenuptial agreement for a couple with significant individual assets. Every lender or investor eventually will need his money back, and a legal document covering everything from the terms to the timing can avoid the kind of acrimony just described.

6. Poor cash flow management-- Too many new business owners burn through their seed money too quickly and fail to reach cash flow-positive status in a timely manner. Some causal factors, such as late product deliveries and economic downturns may be beyond one's control, but the executive team is clearly at fault for others, such as unnecessary spending and overly optimistic expense/income forecasts. Financial sponsors don't take kindly to that sort of mismanagement. And if they turn off the tap, all of your hard work may go down the drain.

There are other pitfalls to avoid, but the bottom line is this: Play by the lenders' rules to get them to open their checkbook, but protect yourself at the same time. There's no point in launching a business that will eventually sink under the weight of your investors' demands. If your business plan is good enough and you approach the right people, you should be able to whistle all the way to the bank.

Brad Sugars is the author of 14 business books including The Business Coach, Instant Cashflow, Successful Franchising and Billionaire in Training. He is the founder of ActionCOACH, a business coaching franchise based in Las Vegas, NV. Download the "5 Ways" iPhone app for more strategies and insights on implementing this powerful formula in your business.

http://www.entrepreneur.com/startingabusiness/startupbasics/startupbasicscolumnistbradsugars/article184350.html

10 Mistakes to Avoid When Selling Your Business

Most sellers don't expect the exit from their company to be easy, but many are surprised by how difficult it can be to sell their business for a good price in a reasonable timeframe, especially in the current economic environment. It's important, however, to not let frustration get in the way of maximizing your sale.

The majority of frustrations and challenges sellers experience could be avoided easily with a little information upfront about the pitfalls of selling abusiness in today's market. There are literally dozens of challenges to overcome in a business sale--but here are the 10 that could have the most significant impact on both your business sale and your peace of mind.

1.                  Insufficient Preparation
Lack of preparation is by far the most common mistake that small-business owners make. Just like you would spruce up your house before hanging a "For Sale" sign in the front yard, it's important to address several key aspects of your business before listing it in the business-for-sale marketplace. Financial documentation, sustainable profitability, lease issues, staffing problems and other concerns will not only impact salability, but also the price your business will command in the marketplace. Another thing to consider is that the time to start preparing for your business sale is right now--most brokers recommend owners start the preparation process at least two years before the business is listed.

1.                  Overconfidence
There's nothing wrong with being confident that you are going to successfully sell your business at a good price--unless your confidence causes you to neglect activities that are necessary to make your sale a reality. Far too many sellers go into the selling process with the confidence that they will get top dollar for their business simply because they believe that is what it's worth. In the real world, valuation is based on quantifiable criteria, not the owner's personal estimation of worth. To avoid this mistake, get an objective third-party valuation, or visit online business-for-sale websites to see comparable businesses for sale, early in the process. Once you've identified an appropriate valuation for your business, address the issues that could lead to increases in value.

2.                  Unwillingness to Leverage Professionals
You're an expert at running your business--not selling it. Yet it's always surprising how many sellers are averse to hiring a business broker to facilitate the sale of their business. Would it be nice to save the roughly 10 percent brokerage fee? Sure, but in most cases brokers are capable of adding at least 10-12 percent to the sales price. Even though there are certain circumstances in which a for-sale -by-owner approach makes sense, most owners are better off hiring a broker to handle important tasks like preparation, showing the business to potential buyers, marketing and negotiation. Likewise, don't hesitate to leverage the expertise of other professionals (e.g. accountants, lawyers, financial consultants) when you need them.

3.                  Taking a Hands-Off Approach
Once you've hired a broker, your work is done, right? Not a chance. Unfortunately, many sellers make the mistake of disengaging from the selling process once they've signed a brokerage agreement. Although your broker will work hard to market your business, no one has more motivation to sell, or inside knowledge about the business, than you do. If you haven't done so already, have a conversation with your broker about how you can proactively market your business without stepping on his toes. In addition, once the broker has found a few qualified buyers, you'll play a key role in instilling confidence in the buyer that the business can be purchased and managed successfully. Whether you like it or not, your interaction with the potential buyer will have a large impact on whether your business sells.

4.                  Failure to Pre-Qualify Buyers
Early pre-qualification of prospective buyers is essential for a successful business sale. Business sellers typically want to avoid qualifying prospects too soon for fear that will scare the prospects away. In fact, more often than not pre-qualification draws prospects deeper into the sale. More importantly, early pre-qualification protects sensitive information about your company from falling into the wrong hands and ensures that only serious buyers have access to key details of the sale. Pre-qualificationdocuments like confidentiality agreements and financial background information are standard requirements for prospective buyers interested in seeing critical information about your business.

5.                  Misrepresentation
As a seller, you want to portray your business in the best possible light. However, there is a big difference between representing your business in the best light and misrepresenting your business to prospective buyers. At some point during the selling process you will be tempted to exaggerate numbers, distort projections or even cover up problems. However, misrepresentations send up red flags when prospects review the actual financials and can become the basis for legal action after the sale. Talk to your attorney or broker about everything, including business forecasts, before passing the information on to the buyer.

6.                  Pricing Problems
Inexperienced sellers have a tendency to set a price (usually on the high side) before they've determined value. The reason this is such a big mistake is that price is the single most important factor in determining how long a business stays on the market. Sellers who have taken the time to conduct a thoughtful valuation process before assigning an asking price are more in touch with marketplace prices and better positioned to defend that price and to reap the benefit of a faster, smoother sale.

7.                  Only Entertaining All-Cash Offers
All-cash sales are unrealistic in today's business-for-sale marketplace. They can also be detrimental to sellers from a tax perspective. Instead of handing over a big chunk of cash at closing, today's buyers are more likely to need concessions in the form of seller financing, deferred payments or assistance in obtaining third-party financing. The benefit to you as a seller is that spreading sales receipts over a multi-year period can enable you to avoid higher tax brackets.

8.                  Breaching Confidentiality
Confidentiality is important. If the word gets out that your business is on the market, it could adversely affect sales and your relationship with your staff. A good broker will know how to simultaneously market your business and maintain strict confidentiality. If you're pursuing a for-sale-by-owner approach, it's a bit trickier but it can be done by creatively targeting your marketing efforts to a small handful of likely prospects.

9.                  Failure to Address Transition Issues
Many owners are so focused on selling their business that they completely neglect the transition process that will occur after closing. Some buyers will insist on the seller remaining on for a few months to assist with the transition or training, while others prefer a clean break. Either way is fine--as long as the buyer and seller have discussed the transition and reached a mutually acceptable arrangement during negotiations.

Whether you're selling on your own, or employing the help of a business broker, following these 10 tips will help maximize the success of your sale.

Mike Handelsman is Group General Manager of BizBuySell.com--located in San Francisco--and BizQuest.com, two business-for-sale marketplaces. Both sites feature business valuation tools that draw from the largest databases of sales comparables for recently sold small businesses, and two of the industry's leading franchise directories.

http://www.entrepreneur.com/money/buyingandsellingabusinessmikehandelsman/article207026.html