The Leverage Equation Page 12

  BUT I DON’T WANT TO “USE” MY FRIENDS

  Unfortunately, despite the huge potential value of network leverage, many people remain uncomfortable with the whole idea.

  It might feel disingenuous, like you’re analyzing relationships based on their resources and usefulness, rather than based on friendship alone.

  Or it might feel dangerously close to exploiting your friends for profit.

  Some people feel it’s insincere or manipulative—an elegant way of using people.

  Task-oriented workers may feel that connecting with people is little more than a distraction from their “real work” of getting the job done.

  All of these criticisms are valid, but only if you approach network leverage the wrong way.

  There’s a sincere, non-exploiting, highly productive way to build your network based on giving first that feels natural and appropriate to both parties.

  Let’s look at how network leverage is done right so everyone can feel great about the business relationships they build.

  4 STEPS TO BUILD A NETWORK THAT MULTIPLIES YOUR WEALTH

  Step 1: Decide Who You Want in Your Network

  The starting point is to decide who you want in your network.

  That requires you to first look inward at what you’re trying to accomplish, before looking outward at who can help you accomplish it. Your own personal long-term goals need to connect with the goals for your network strategy. That means having an understanding of the purpose of your networking – and who you need to meet and build relationships with in the long term to reach your goals.

  For example, when I began attending the FinCon conference referenced earlier, my goal was to connect with financial bloggers who were more successful or more advanced in the business than myself. Back then, it was like the Wild, Wild West because there was no proven business model. It was all new, so everyone was making it up as they went along. One person had mastered advertising; another, affiliate marketing; another, search engine optimization; and another, audience engagement; but nobody had mastered all the components of the business. Each blogger had something to share, bringing different experience to the table, but we were all in essentially the same business. The result is we’ve all grown our businesses faster and with fewer mistakes by sharing our knowledge.

  The key is to have clearly defined targets; otherwise you might build an extensive network, but it might not be relevant to what you need.

  You could choose to develop your network around professional interests like engineering, product development, marketing, sales and the like.

  It could be based on a business model – for example, internet marketer, or manufacturing with a typical supply chain, or B to B, or B to C.

  Or it could be based on filling gaps in your plan where it’s particularly weak.

  Once you decide the types of people you’d like to have in your network, the next step is to target specific people instead of targeting a whole company. Go narrow and deep (versus wide and broad).

  Find out who makes the relevant decisions at the companies you are targeting. You can usually find this information by checking corporate press releases, LinkedIn, and the speaker roster (and topics) from industry events.

  What are the various high leverage relationships you can develop? Professional, collegial, mastermind, and client relationships all offer tremendous upside potential.

  Step 2: Connect with Those People

  Now that you have your targeted list of contacts, the next step is to communicate with them.

  Every relevant relationship is an opportunity to ask questions, solve problems, share resources, and strategize to expand your knowledge base. Be a good listener. Learn from every interaction.

  Go where the right people go so you can meet them. If you need funding, network with funders. If you need to learn something, network with people who know the answers. If you want to sell, network with potential buyers. Always be developing relationships with people who are one step ahead of where you’re taking your business in the future. That way, when the need arises, you can pick up the phone and make it happen.

  Starting the relationship need not be any more complicated than creating a conversation. Be interesting and interested by asking relevant questions that further the conversation, rather than giving answers that end it.

  Smart, thoughtful questions further the conversation and deepen the relationship by getting people talking about themselves. Most people won’t just open up naturally, but if prompted in an engaging way, they’ll tell you more than you ever thought you needed to know. The key is you have to be genuinely interested.

  Meeting people to initially break the ice has never been easier than with the internet. Social media puts you within reach of nearly every person, regardless of celebrity status, as long as you’re willing to make an effort to cultivate the relationship.

  Because of social media, you should never cold-call or cold-email anymore. With LinkedIn and Twitter you can break the ice in an innocuous, comfortable way.

  Discussion forums and LinkedIn groups can provide a lot of information and feedback. You can send out a question and get multiple expert replies. Sometimes an entire discussion will erupt online, fleshing out all the intricacies of your question.

  Don’t underestimate the value of weak ties made online. The “6 degrees of separation” principle that connects all of us gets smaller all the time. There’s huge combined wisdom, connections, and opportunities in your network – even at the casual level.

  Online connections may not be as strong as in-person relationships, but they can still provide valuable feedback and referrals that eventually lead to in-person and telephone relationships. As you follow up with your online connections, you’ll build those relationships into something deeper and more valuable for both parties.

  The way you efficiently nurture your weak ties into stronger relationships is through scalable communication strategies. A weekly blog post, email list, and regular social media updates will help you maintain consistent contact with your entire network and can expand your network to include new people you’ve never met. Use this scalable update strategy to help people en masse while also reminding people of what you do.

  Forming a mastermind group is another way to apply network leverage where each member of the group benefits from the knowledge, experience, and network of every other member because of the trust relationship that’s built through the ongoing mastermind format.

  Another way to find connections relevant to your business is through resources such as the SBA’s SCORE and its classes, and through government agency programs, foundations, or corporations with similar interests.

  Participate in professional associations. For example, an attorney might help out with his local bar association, or a female executive could join the National Association of Female Executives (NAFE) and the National Association of Women Business Owners (NAWBO).

  Finally, you could take the traditional approach of simply meeting other professionals for coffee or lunch on a regular basis.

  In short, there are many ways to initially meet the people with whom you’d like to build your network. Just pick the strategy you’re most comfortable with and get started.

  Step 3: Build the Relationship

  Once you’ve opened the door with that first contact, the key to building a genuine relationship is to focus on the other person’s needs, not your own. Pay it forward. Your first concern should be: “What’s in it for them?”

  Staying with the example of the FinCon conference, it’s the most valuable and enjoyable business event I’ve ever attended because the entire culture is rooted in giving first. That’s because the attendees were writers in the business of helping their audience with their finances. The very nature of the business model was to first give your best knowledge generously, and then it comes back through other channels. This resulted in a conference of givers sharing their best business advice, simply because that’s their habitual business
behavior. It’s what makes the conference so valuable.

  The way to connect during conversations is to be interested and interesting. When you meet someone with common interests, follow up promptly with an email to establish that common connection for relationship. Stay fresh in their minds by reaching out every one or two months to share something of interest that’s valuable – a resource or news item related to their needs.

  Actively listen to the other person to find out their needs because you’re genuinely interested in being helpful. Always seek to add more value than you take away. You care about the other person and their challenges, and you’re willing to give value where appropriate.

  Be the first to offer up your contacts and resources before you make demands on the relationship. Recognize that the rule of reciprocity is implied in human relationships. It’s never overtly required, but research has shown that most people feel it nonetheless. So give generously and don’t worry about what comes back.

  Your giving doesn’t have to be anything big. Just a small gesture at the right moment can open doors for the other person and build value. Some ideas include:

  Providing an unsolicited introduction to somebody in the same industry.

  Sending a link to an interesting article related to what they’re working on.

  Or it could be as simple as a supportive follow-up call regarding a challenge they were facing.

  Just remember to keep all communications succinct because everyone is busy. Always think about how you can provide value, respond quickly, and keep the conversation going while respecting the other person’s time.

  Step 4: How To Ask For Help

  Eventually you build the relationship to a point where it’s appropriate to ask for help. After all, a highly valuable network is only useful if you use it.

  Fortunately, this is never a problem when you build it right, because the context of well-developed relationship removes any discomfort in asking because your intent has been genuine from the beginning – so the other person wants to help you just as you would want to help them.

  There are very few business problems that your peers haven’t already experienced in their career. So they can empathize with your situation and are happy to help by sharing their experience – whether by arranging introductions or offering advice. Someone always knows someone who can give you exactly what you need – whether a restaurant recommendation or an introduction to a key decision maker for the deal of your lifetime. But if you don’t ask, you won’t get it.

  When asking, be clear and concise with your request and expectations because everyone is busy. Connect whatever you’re asking for help with to previous conversations, so it doesn’t come out of left field.

  For example, a simple ask could be something like: “Per our previous conversation about the financing challenges I’m facing, I’ve decided to start looking for angel investors interested in app development projects. I was hoping you could provide a quick intro to that investor you worked with in Portland last summer.”

  Notice how the ask is completely related to previous discussions so there is nothing awkward in the request. It’s just a logical next step in an ongoing communication between the two of you.

  NETWORK AND RELATIONSHIP LEVERAGE IN PRACTICE

  If you are still feeling uncomfortable or don’t quite see how this sort of leverage works, I understand. The best way to go about building these sorts of networks is to commit your time and energy to groups and missions where you share a personal interest. You must be genuinely interested in the networks in which you are investing your time and energy. For example:

  Volunteer or organize volunteers for a community program you believe in.

  Enroll your community in your cause.For example, my kid’s school enrolls parents to donate their time in the classrooms, for fundraisers, and for community events to support their children’s education.

  Join (or create) a mastermind group. Leverage and add to the knowledge, experience, contacts and resources of others, plus gain accountability.

  Attend classes and programs that interest you. Meet and mix with the attendees and presenters.

  Teach a program that adds value to your audience and make yourself the hub of that community.

  Whatever way you choose to build your network and relationships, make sure that you are adding as much value as you are receiving. That is the key to building genuine connections.

  You can find more network leverage ideas in “101+ Leverage Hacks: A Cheat Sheet for Quickly Implementing Leverage in Your Wealth Plan” at https://financialmentor.com/free-stuff/leverage-book.

  LEVERAGING YOUR CUSTOMER NETWORK

  Don’t just limit yourself to professional or peer networking! Your customer network can be an excellent source of referrals and connections as well.

  Referrals from your client network are the next best thing to an existing customer because there’s implicit trust in the referred relationship.

  Your goal as a businessperson is to provide such a great product or service that customers will enthusiastically “thank you” for all the value they have received. When that happens, you need to have a mechanism built right into your business system that invites a referral. After all, nobody wants to ask their clients intrusive questions like “Who can you recommend me to?” or “Do you know anybody that could use my product?”

  Instead, you want to build referral systems that encourage your clients to spread the word about your great products.

  The required first step for customer referrals is developing a truly remarkable product or service that is worth referring to others. Referral systems only work when people feel that they’re helping their friends or business associates with their referral. “Remarkable” could be as simple as being a contractor who returns calls, delivers on time, and completes the job under bid (since that’s so rare), or it could be a product that solves a key problem. The point is: it must “wow” existing clients because nobody refers a product or service unless it stands out.

  Second, you have to design a process that refers others as a natural part of how you do business – so you never have to ask those intrusive questions. It could be a financial incentive or a bonus for referrals; or it could be structured into the original agreement as a condition for completion so that it’s fully expected; or it could be as simple as sharing a link to the sales page.

  Finally, you’ll want to set up a follow-up system to prompt making the referrals and also communicate what resulted from the referrals to complete the communication loop. And always thank the referrer for their support! Referring a friend or colleague is the ultimate compliment, so acknowledge each referral with an appropriate “thank you.”

  When someone gives you a referral, it’s important to follow up in a relatively short period of time. If the individual has called his contact and given that person your name, you want to follow up while your name is still fresh in that person’s mind.

  It is also a good idea to let the original contact know what is happening with the referral. Send an e-mail to the referral and copy the referral source. That way, the referral source is reminded that you are out there; the referral source sees that you are a person of action; and the referral is reminded of your connection to the referral source. You can also send a letter to the referral source updating him or her.

  Then if the referral leads to anything, let the original contact know about it and thank the contact again.

  IN SUMMARY

  The key point of this chapter is that no business exists within a vacuum; all business is done through relationship, which is why relationship leverage is so valuable.

  Building a network is worth the effort because strategic alliances with the right people can either make or break your wealth plan. The value of a solid piece of advice at just the right time, or getting the chance to work with someone who has deep experience in your industry, can be game-changing.

  Be creative and opportunistic in how you meet people, and buil
d the relationship by focusing your efforts on giving and paying it forward. Play the long game.

  Building a strong professional network of strategic contacts is something that can take years. Like investing for retirement or college, what you get out in the end has a lot to do with what you put into it. It takes effort, but the compound return on that effort can make or break your results.

  Furthermore, the sooner you start investing in your network, the larger the rewards are down the road. But before you start making withdrawals, make sure you have built a strong “nest egg” of good will. If you allow your business relationships to grow over time, your contacts will be much more helpful to you when you do finally start asking for advice.

  With the right relationships you can accomplish nearly anything. The key is who you know, what you know, and how you ethically apply those resources.

  EXERCISE: BUILD YOUR NETWORK

  Identify one person who’s already built a business similar to what you want to create. The similarity might be in terms of revenue model, size, industry vertical, or choice of technology.

  Reach out to that person.

  This could be a simple email and possibly follow-up phone calls. Or maybe you “stalk” him a bit on Twitter or in blog comments before taking it further.

  Build the relationship by asking smart questions, providing genuine acknowledgments, taking his advice when provided, and following up with your results.

  Sometimes it can be as simple as paying for 20 minutes of the person’s time on an advice website like Clarity.FM – if they’re high profile or a media personality; but most of the time it will take much more effort.

  The point is to network up and build connections that can take you to the next level of growth.

  Once you’ve completed this assignment for one person, then rinse and repeat by creating a list of people who can help you achieve your goal.