I’m going to make an unexpected connection between:
- SCORE, a great free resource for entrepreneurs;
- a cappella singing; and
- economic theory.
For entrepreneurs thinking about funding, the bottom line of my connecting the dots is: don’t be confused by marketing noise.
Or as I like to say,
The best things in life are free, but they lack a marketing budget.
SCORE and Other Free Resources for Entrepreneurs
As you may know, SCORE is an association and network of volunteer expert business mentors. The 10,000 volunteers are organized in 300 chapters spread across the US. Organized in 1964 as the Service Corps Of Retired Executives, SCORE now provides free or low cost assistance in a variety of media: face to face mentoring, free or low cost in-person seminars, free online webinars, and a ton of free online resources.
I’m a fan of SCORE in part because here in Portland Maine, we are fortunate to have a world class chapter chair. In fact, Nancy Strojny has not only made Portland SCORE world class, she sits on the Executive Committee of the Board of Directors of the national SCORE Association.
While SCORE is helping lots of young businesses, they aren’t exactly a household name. Why is that?
They get a tiny piece of funding from the federal government – on the order of $11 to $13 million a year. They run this massive national program with fewer than 30 full time employees. The budget also gets some help from national corporate sponsors, and local chapters have to be entrepreneurial as well in finding funds to expand programs.
And that’s a good thing in a way – it means the volunteer mentors can relate to bootstrapping entrepreneurs!
And SCORE is just one example of free or very low cost resources available to help entrepreneurs.
But like SCORE, these resources very often are not tied to an organization with significant revenue, and thus a big marketing budget. That means their value to entrepreneurs often has to be discovered through aggressive search, rather than having that value appearing miraculously in your social media feed or Google search results.
Without that big top line, there is almost no marketing budget to get the word out about how wonderful SCORE is.
A Cappella Is A Very Low Cost Musical Form
As I’ve mentioned elsewhere, I was the best known a cappella music entrepreneur for 16 years (1992-2008). I want to share a story from my marketing adventure that brought home the phenomenon I’m talking about.
In pursuit of music educator customers, I bought a booth at the annual convention of NAMM: the National Association of Music Merchants. I hadn’t been there before and didn’t know what to expect.
As a reminder, a cappella is singing without instruments.
My little 10×10 booth of unaccompanied singing was lost in a sea of hundreds of instrument makers, marching band costume providers and choral robe merchants. These businesses evidently had a strong business making sure that young musicians spent many hundreds if not thousands of dollars per year on their music habit.
By contrast, a cappella singing is cheap. Sometimes even free!
The college a cappella tradition I came from at Yale is built upon volunteer student singers and directors who arrange music for the group to sing. Their primary expenses are traveling – which is generally paid for with concert fees – and making a recording – which back in the day was paid for with sales of records, cassettes or CDs.
There are also street corner a cappella traditions, including barbershop quartets (in the early days at least) and doo wop in which four singers made up harmonies to songs, without buying any sheet music.
So while a cappella is one of the “best things in life” for those who love creating vocal harmony, it is also cheap or free for many enthusiasts. Which in turn means there was almost no financial incentive, back then, to market a cappella.
Unlike all of the instrument related companies, who had significant financial budgets to market their expensive musical paraphernalia. I was the only a cappella proponent at NAMM.
Without that big top line, there was almost no marketing budget to get the word out about how wonderful a cappella is versus instrumental music.
A Flaw In Market Economics
Part of me is a closeted theoretical economist.
My dad was trained as an economist and talked a lot about economics at home. I took Early Concentration Economics (double credit) as a freshman at Yale and loved it. The only way they’d let me bypass Intermediate Economics was to take graduate school Micro and Macro Economic Theory. Which I did, as a sophomore.
While I ended up pivoting towards computers and telecommunications as a junior, I’ve retained a theoretical economist pair of glasses, if you will, that I apply to the business world from time to time. In fact I almost went back to get a Masters in Economics at age 50, even going so far as applying to and being accepted at three schools. But I pivoted to entrepreneurship instead.
With that as background…
One of the reasons I became interested in telecommunications as a senior in college was that data communications, it seemed to me, opened the potential to solve the problem of imperfect information in economics.
The problem, to oversimplify, is that the wonderfully simple and magical equations of Economics 101 only work if you assume that information about product prices, and availability, and quality, and everything else, magically spreads instantly and equally to all consumers in a market.
Which of course it doesn’t. But as I learned about data communications, I envisioned a day when data communications networks could instantly transmit that information everywhere. Today that’s happening, kind of, with the internet.
But there’s another imperfect information problem that sits at the intersection of marketing and human nature.
More than ever, we live in a time when a tidal wave of inexpensive marketing messages are battling for our precious attention time.
In short, we can never be as all knowing about what’s available to us – we can’t have “perfect information” – as basic economic theory would imply because we simply don’t have enough attention time.
And importantly, the information about some things we might prefer to buy or spend time on is crowded out by zillions of marketing messages of things with big budgets.
Instruments, not a cappella.
Venture capital and loans, not bootstrapping.
The best things in life may be free but they lack a marketing budget.
What This Means For Entrepreneurs
As you search for funding options, or help in figuring out funding options, remember that some of the best things out there lack big marketing budgets.
You may be bombarded by a ton of online ads for “business loans NOW!” But have you seen an ad for a Community Development Financial Institution or CDFI?
You may have seen online ads for commercial loan brokers, but probably not for a SCORE mentor.
Lots of digital marketing and customer service options will be vying for your business. But who’s going to market the simple and cheap idea of calling your customers to thank them and ask what else you can do for them?
The best things in life may be free but they lack a marketing budget. Your job is to find them.
And we hope we can be of some help, even with our current lack of a top line or a marketing budget!