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November 1st: Torsten Jacobi, CEO of Creative Weblogging, joins host Anita Campbell. Sponsored by Six Disciplines. Show details.
Wednesday, June 29, 2005
Microbusinesses -- Smashing Stereotypes
When it comes to microbusinesses -- those very small businesses with no more than five employees -- size isn't what counts the most. These tiny enterprises can land business that seems to dwarf their size. Commitment and a clear plan are key determining factors that give these businesses leverage beyond their size.

A recent story in The Microenterprise Journal illustrates this very point. Since the Journal requires a paid subscription to access it, here is an extended excerpt of the article (quoted with permission of the publisher):
"One of my favorite hobbies is smashing stereotypes. And one of the most egregious sets of stereotypes around, from my perspective, are the stereotypes about microbusinesses -- specifically, the stereotypes that arise because people make assumptions about what microbusinesses can and cannot do, based on their size.

For example, while it is true that most microbusinesses make relatively little in annual average revenues, it is not true that all microbusinesses make relatively little nor is it true that those that do make relatively little do so because they are microbusinesses.

That's why it makes me particularly happy when I come across a company like the Valorem Corporation.

The Valorem Corporation is a veteran-owned, Laurel, MD (USA)-based firm, and is young enough that owner Kyle Haycock couldn't even make a guess at its average annual revenues. It was just incorporated this past March, and Haycock has just hired three new full-time employees.

He needed to do that because he has just landed a six-month contract with the Department of Defense, worth half a million dollars.

So much for what microbusinesses can't do.

Valorem is in the business of supplying linguists and intelligence analysts to the federal government. It is a line of work that Haycock is very familiar with because he has been doing it for the past decade. In fact, that is pretty much what gave him the idea to start this business. According to Haycock, Valorem was formed specifically to be a government contractor.

That means that his business is not likely to stay micro. But it also does not mean that he has to wait until his business "grows up" before he sets out to do what he set out to do.

* * *

Even with all the advantages of being well-versed in the needs of his prospective customer, having all kinds of contacts among the procurement officers he needed to deal with, and a very respectable record of past performance working under other circumstances but performing the same services, he still had three-fourths of a year of administrative tap-dancing to deal with.

Valorem, unlike most microbusinesses, was formed and designed strictly to serve the federal government. For a microbusiness owner who may want to sell to the government but who may also want to do something else, the kind of single-minded tenacity displayed by Haycock can only come at the expense of other business. And, for most microbusinesses, losing current customers because of that single-minded pursuit when you don't even know that you'll win the contract is a seemingly insurmountable obstacle to federal contracting."
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