New Business Verticals Within a Company

    How does a company whose revenues are flat (and have been for a while) get out of that funk? I found that the vertical integration of your business line is the perfect answer.
    Vertical integration is when a company controls more than one stage of its product or service. It can be in the form of other businesses created out of the base business. A personal example is when I started the Bella’s Restaurant chain. Everyone loved our red sauce so much, we decided to create and brand “Mama’s Red Sauce.” We sold it at our restaurants and through a national super market chain, limited to the north east region. Vertical integration can also be a supply chain for commodities, which is exactly what Reliance Energy of India did (as we’ll see later on). There are four phases of the supply chain: commodities, manufacturing, distribution, and retail.
    There are two types of vertical integration. Forward integration is when a company at the beginning of the supply chain “downstream” controls stages further along. An example would be a diamond mining company that owns mines, and then creates a distribution and retail diamond company. Backward integration is when a business at the end of the supply chain takes on activities “upstream.” An example of this is when a movie distributor, such as Netflix, also manufactures content.
  1. Backward Integration
    Reliance Energy is a perfect example of backward integration. Its creator, Dhirubhai Ambani, was a poor fabric dealer among thousands of dealers, but he wanted to reduce the cost of producing carpets. Dhirubhia was so frustrated that he could not get a good price on fabric, so he decided to create a Fabric Manufacturer company. The Fabric manufacturing company reduced the cost of his carpets so well, that he continued to move backwards in the chain. Dhirubhai was making a lot of polyester and using a lot of petrochemicals, so he decided to become a Petrochemical Manufacturer as well, which reduced his cost to produce the end product (carpets) even further. Dhirubhai was using so much petrol, that he then created a Petrol Distribution business, and then a refinery, and so on. You can see how he continued to work backward in the chain to achieve vertical integration.
    By the time Dhirubhai Ambani passed away, Reliance Energy was generating $20 billion in revenue and was 7% of the Indian GDP.

  1. Forward Integration
    Credit Justice Services (CJS) was a small credit restoration company that I started in in 2004, in Florida. It was a technology and data company that disputed inaccurate and unverifiable negative trade lines as reported by the three credit reporting agencies, namely, Equifax, Trans Union, and Experian. As the data from the three credit bureaus were coming in, we saw a pattern among them. CJS noticed that the three credit bureaus were not following the Fair Credit Reporting Act (FCRA), which was passed in 1970 to ensure fairness, accuracy, and privacy of the personal information contained in the files of the credit reporting agencies.
    After noticing this, I decided to team up with bankruptcy attorneys around the United States to assist my clients after the credit restoration process was complete. By law, the credit bureaus must remove any negative credit lines challenged by the consumer within 30 days that they cannot prove (As we would say, “Prove it or remove it”). If they don’t, they can be sued for up to $1,000 for each mistake. So, we tagged each credit line that was not removed under the FCRA, and sent the files to our network of attorneys. This did two things for us: first, it gave us another business line, and second, it differentiated our company from all the other credit restoration firms.
    One time when I was speaking at a credit restoration event in Dallas, Texas, I was approached by several of my peers who asked how I was able to handle so many files per month, and produce the type of service and results CJS was known for. I freely gave my colleagues the information they were looking for, but there was one problem for them: I owned all the proprietary rights to the software and process. I soon created a wholesale division of CJS, helping other credit restoration companies to produce more at less cost.
    There are an infinite amount of ways to expand into the vertical market; those were just two examples among many. However, jumping right into vertical integration is not recommended. As always, success depends upon thorough research, and the vertical integration process is no different. To decide whether or not you should try to expand into the vertical market, there are some things you should ask yourself.
    The 3 questions to ask before expanding into a vertical market:
  1. Why: Why are you expanding into this new market? What data is driving your business’s decision to expand into this market? How do you know customers want or need this product or service? Companies doing well in particular markets can start to get “I can’t fail” syndrome. This is a rabbit hole you do not want to go down, so make sure the “why” is answered, and ensure that you are conducting thorough and complete research (Customer Discovery).
  2. What: What are you offering to a new market place, and is there a large enough differentiation factor to pull you through? Why is your client going to buy from you, rather than the company down the street (Better, faster, cheaper)? Make sure to do the research with your potential clients first (Customer Discovery)!
  3. Who: Who will you target when focusing your expansion efforts? I have seen many companies start with their potential Total Available Market (TAM) instead of their Target Market (TM), which is less costly and more manageable. For example, when I had Credit Justice Services only in Florida, I had the same amount of cash flow as I did when I expanded into 47 States…More headaches—same money!
    Vertical market expansion is more comfortable and less risky than entering into a totally new market. It can be very lucrative because of the expertise and employee base already in place. If the proper research is conducted, the risks are even further minimized as your chances for success increase. As long as you fully investigate those three questions (the “why,” the “what,” and the “who”), you can creatively weave your way into the vertical expansion market and reap the benefits.
    If you’d like more information, please feel to contact me at


    The French word “entrepreneur” first appeared in the French dictionary in 1723, and defined a person who organizes and operates a business while taking a financial risk in order to do so. Since the word entrepreneur came on the scene, it has added some terms like “social entrepreneurship” and “intra-entrepreneurship” (which are terms I explain in other articles). Most simply defined, an entrepreneur is a person who identifies a need or a want and starts a business to fill that void. This simplistic definition, however, provides little insight into the specific character traits and attributes that makes a person thrive as an entrepreneur—especially one doing business in the 21st century.
    Before quitting my day job as an airline pilot to pursue an idea that was brewing in the back of my mind, I considered if I had the necessary fortitude to make it as an entrepreneur. As it turns out, I did. I have been practicing entrepreneurship since 1992, and teaching it as a professor since 2012. I’ve learned a lot, and I certainly know all too well about the pursuit of opportunity without regard to resources. I started my first venture by doing everything I now teach not to do (e.g. I maxed out 10 credit cards, refinanced my condo, borrowed money from family, friends, and fools, etc.). At a fundamental level, all entrepreneurs try to overcome adversity to pursue opportunity with limited resources. So, unless you are comfortable with minute to minute change, incredible amounts of stress, and the uncertainty of your future financial stability, you should consider diverging from the entrepreneurial path.
    As a devoted student and lifelong practitioner of entrepreneurship, these are some things I have learned about over the years from truly successful 21st century entrepreneurs and mentors:
  1. Most start-ups fail : (According to the Small Business Association only 30%of new businesses fail during the first two years of being open, 50% during the first five years and 66% during the first 10). The road to success is often long and lonely, with brutal hours, massive amounts of stress, and lots of personal/family sacrifice and debt. So, why would you want to become an entrepreneur? Well, it gives you the freedom to be your own boss and the creator of your future.
  2. Survival as an Entrepreneur: In my late twenties, I became an entrepreneur (I started I&E Marketing Group—a reseller of phone time to airline personnel), even though I didn’t know the meaning of the word “entrepreneur,” let alone how to spell it. Nevertheless, I saw a void and filled it. In order to survive, I thought, ate, and drank telecommunications. I refined, iterated, and pivoted when needed. I NEVER gave up in the pursuit of my dream.
  3. How to Find Resources: One can do this by making, maintaining, and leveraging contacts. Despite adversity, entrepreneurs can find ways to exploit opportunities for mutual benefit, by networking and being a great student in both the short and long runs. This is the most powerful part about entrepreneurship. The more you give back to the entrepreneurship community, the more you get!
  4. Managing Risk: Up front research is everything to starting a successful company. But, even though research can help you avoid the pitfalls of risky ventures and save you in the long run, some mistakes are inevitable. As life and experience have come upon me, I’ve learned that great entrepreneurs are focused, learn from their mistakes, and move on without regrets. Their appetite for risk is far greater than the average person’s (although it decreases with age and experience).
  5. To Make a Difference: In my fifties, the idea of entrepreneurship completely changed for me. I had started and sold 10 companies and was successful at my trade, but I wanted to make a difference; to do something that has a positive and long-lasting impact. I went back to school to get my MBA, and started teaching what was so freely given to me by my mentors. This required a different kind of mindset. It is not just about making money, or becoming famous, or creating new things. Making a difference as an entrepreneur has been very rewarding for me. In my travels around the world to speak about and teach entrepreneurship, I have met entrepreneurs from all walks of life–in government, in academia, corporations, labs, and on stage. All these entrepreneurs have one thing in common: they feel the desire to give back to the entrepreneurship community.
    What Is the 21st Century Entrepreneur Made Of?
  • Personality: Entrepreneurs are risk takers and have resilience, tenacity, innovation, creativity, and the ability to identify opportunity all rolled up into one. Whatever the entrepreneur lacks, they make up for with a great employee.
  • Attitude: The entrepreneurial attitude is defined by personal standards and values for the company and employees; the perception of being the best, no matter what the size of your corporation is; understanding the importance of customer focus; and the desire to use and apply creativity and imagination.
  • Motivation: This and attitude is everything! Motivation consists of personal drive and ambition, the desire to make an impact, the need for achievement or self-satisfaction, a desire for status, to create and accumulate wealth, and social responsibility. I was always very aware that I was not the smartest person in the room, and I was okay with that. But, I also knew that no one—in any room—would outwork me.
  • Skills: These will be learned on the job and at a quick pace. You will spend many hours developing your entrepreneurial craft, but once it comes together and you learn from your mistakes, it gets better and easier. I cannot emphasize enough how important it is to have these few necessities: the ability to network, to think strategically, and gain access to resources, as well as possess business knowledge, interpersonal skills, and management skills.
    In the end (and I hate to say it), there is no exact formula for entrepreneurship. Even in the 21st century, when entrepreneurship is a well-taught and well-respected field, the road to success has no GPS to provide you with a turn-by-turn map. Instead, entrepreneurship is as unique as each individual, and you cannot follow someone else’s journey to success. That journey is uniquely yours, and yours only.

Business Mistakes Transformed into Knowledge

As I ponder what I’ve learned over the years as an entrepreneur, I can confidently say that my biggest insights have come from my mistakes. I would like to share these educational pitfalls with all new entrepreneurs who are starting new businesses. The number of mistakes I made as a new entrepreneur was painfully high, but I would not change those learning experiences for anything. However, to assist the new entrepreneur who may read this article, I wanted to write about what I should have done differently in business. I would like to invite all seasoned entrepreneurs to add your experiences to this list.


I really don’t believe in failure. I believe that what looks like failure is actually a learning experience with the opportunity to move you in a different direction. Every time I start a new company, it is an opportunity not to repeat the past, but to learn from my past mistakes. After many years as an entrepreneur, I finally have the experience to identify how not to follow the same path of mistakes over and over again. I would like to share some of these insights with you, so you can avoid some of these mistakes, too.


My biggest learning experience in business was when I had almost lost it all. I did the typical entrepreneurial financing for the first restaurant I opened: I maxed out 10 credit cards, leveraged my kid’s college funds (they were five and six at the time), put my home up as collateral, borrowed as much money from family, friends, and fools as I could, and personally signed for everything. The following are a few pitfalls that I learned from this experience, which I would change if I had to do it over now.


  1. Admit you’re in trouble – The ego has killed more businesses than I can count. When the proverbial you-know-what is hitting the fan, most people, including myself, stick their heads in the sand. This was the worst thing I could have done when my restaurant venture was failing. These are the times you have to ask for help and look the problem straight in the eye. When I finally asked for help, it was amazing how many people came to my rescue—landlord, vendors, the bank, and other experts. It’s such a liberating experience when you learn exactly what’s going wrong, and the solution to fix it. For me, the problem was that my partners were stealing from the company (due to a lack of financial understanding). This was an easy fix, and then I moved on.


  1. Partners – This should be the most researched area when starting a company, and yet, is the least respected. A partnership dissolution is worse than a divorce. When it comes to money, everyone changes. I recommend a serious background check, a credential check of past employers, and a review of tax returns and personal financials. If your partners are unwilling to comply, move on. When I started the restaurant, I hired the first person who told me he had a great deal of restaurant experience, which I later found out was false. Writing a very clear job description for each partner helps during the times when the lines start getting blurred due to growth. Each partner has their strengths and weaknesses, so make sure they are outlined in detail.


  1. Operating agreement – This saved me from a partner I had in a consulting firm based out of New York City. After expanding the company 5X, he thought creating a mirror company and taking the clients was legitimate. (A little side note: beware of the attorneys who use boiler-plate operating agreements. There is no boiler-plate anything when it comes to partnerships and entrepreneurship. Every company and partnership is different, so you need to treat them with regard to their highly individualized needs. Example questions you should be asking are: what happens if one of the partners dies? Who gets the stock? Does it go to the spouse? If so, should they receive the same pay for doing no work? What happens if one of the partners leaves within a year? Do they get to cash out for only one year of service? What if a partner is caught stealing? The questions could go on forever, but make sure you ask the tough questions in the beginning—it will save you hundreds of thousands of dollars in the long run.)


  1. Financials – The number one reason businesses fail is a lack of understanding when it comes to financial statements. This was the biggest learning experience of my career, and it proved to be a game changer when I took control of it! When I started my first restaurant, I hired a business broker who built business plans and developed all of my financials, without explaining any of it to me. What I learned from this mistake was that whoever knows the numbers is in control. There are three financial statements you should know as well as your children:


      1. Cash Flow Statement. This is the lifeblood of the company, yet it is one of the least understood aspects. When there is no more cash, the lights go out. You must hoard cash in the beginning, middle, and end.


      1.  Profit and Loss Statement. What we learn from this document is how much revenue comes in and how many expenses go out. The problem here is that your mortgage, accounts payables, etc. are not taken out of the bottom-line number called your net profit. So, it is possible to have a large net profit and still be bouncing checks—which is exactly what happened to me!


      1. Balance Sheet. The balance sheet is even less understood than the cash flow statement. The balance sheet helps you understand certain types of ratios. For example, I do an inventory ratio (how long my inventory is staying on my shelves), and a current ratio (how much short-term cash I have compared to short-term debt), so I know the health of the company.


  1. Know your market – Until I discovered the Customer Development process in conjunction with the Business Model Canvas methodology, I was a poke-and-hope type of guy. I believed the innovative idea I had would work because I said so. The idea that someone would try to start a company, without asking at least 100 people, companies, or potential customers what they think of their idea, just makes no sense. By taking time and doing the Customer Development process, along with a detailed Business Model Canvas, you develop a clear understanding of who your customer is, and what business model is best to deliver your product or service. This process has saved me a great deal of time, effort, and money. Below you can view an outline of the Business Development Model.



                       Business Development Model



If you are a new entrepreneur just starting out, try to remember that mistakes are a crucial part of your entrepreneurial journey, and more importantly, your success. You will make them time and time again, and while it may seem like the end of your business (or the world) at the time, remember to seek out the learning opportunities your mistakes have offered. But, also remember that you are not the first entrepreneur making mistakes out there. Many have done so before you, much like myself, and you can learn from us. If you’re going to make mistakes, make them original. Otherwise, why waste your time, money, and effort? Instead, ask questions from your mentors, and carefully study how to avoid common mistakes.






In April of 2017, I decided to leave academia and my Private Equity Firm to retire in New Jersey and be close to my family. (I know, who retires to New Jersey?) As an entrepreneur, that retirement lasted for about a month. A thought began to plague me: “Wouldn’t it be nice to work full time for another company?” I had never done this before, but I thought I could take my entrepreneurial skills from Main Street to Wall Street. I was going to be an “intrapreneur.”

I was blessed to work with a broker/dealer that had the best reputation on Wall Street, and two of the finest owners a person could ever work for. Although the learning curve was massive, I quickly found out that the same business processes, tactics, and procedures that made me successful as an entrepreneur could be used in my role as an intrapreneur for my new Wall Street firm.

I have researched, taught, and written about big companies that typically struggle with innovation. The research shows that once companies reach a certain size, their investors become more conservative, their leaders less entrepreneurial, and their decisions are managed by consensus. Meanwhile, in an effort to protect their jobs, their employees become less willing to take risks with new and innovative ideas. However, without innovation, companies can get too comfortable with their past successes, just before they find themselves going out of business (e.g., Sears, Blockbuster, Eastern, Pan Am, and many companies on the floor of the NYSE). They lack the innovation needed for continued success.

The intrapreneur’s role, then, is to find new and disruptive ways of doing business, deliver innovative products and services to the market, and foster a culture of innovation to maintain market leadership. Interestingly, intrapreneurs often don’t have job descriptions, and if they do, most of their actual work is done outside what’s written down in the corporation’s policy and procedure guide.

Companies that are not familiar with the intrapreneurial process need to watch out for these four possible pit-falls:

  1. Lack of intrapreneurial learning and validation. Companies and employees unable to do the basics of Customer Discovery for new products and services will be doomed, and will likely fail. It is imperative for your company to bring in an adviser at this point. With the new GIG economy, there are plenty of people like me that would be more than happy to set your company up for intrapreneurial success.


  1. KPI’s not befitting a start-up. Let’s be perfectly clear, a start-up company is not a smaller version of your large company. Metrics must be designed for the start-up, and iterated as information and experience comes in.


  1. Enforcing the corporate structure in your start-up. Enforcing existing management systems is a common mistake when putting intrapreneurial initiatives into motion within a mid to large size company. This will only stifle the intrapreneurial spirit and crush innovation. There are certain systems and processes that only work for start-ups, and not for larger companies.


  1. Strict adherence to company strategy. Making no adjustments to strategy is the life killer of a start-up within a company. The waterfall-type process just does not work. You must be agile, and ready to iterate or pivot on the dime. Again, there are processes for start-ups that work only for start-ups within a company or organization.

You can avoid these four pit-falls if you familiarize yourself with the intrapreneurial process, and if you acquire help from an adviser.

If you are a mid to large company looking for innovation, create a culture of intrapreneurship inside your organizations. Let your employees know that it is okay to spend part of their day jobs tinkering around with new ideas. That it is okay to make mistakes, and that failure will not result in punishment if things do not go as planned. Hire people that have entrepreneurship wired into their DNA; leaders who are not afraid to take risks and make decisions on their own. The company that hired me managed this by first allowing me to teach the owners about the intrapreneurial process and culture. Then, I was able to teach the business unit managers, and finally, the employees, while monitoring, measuring, and iterating all along the way.

As I said before, intrapreneurs don’t typically have job descriptions. Instead, they break the confines of the norm and hunt down opportunities for growth. The innovation that an intrapreneurial culture fosters is indispensable for start-up success within a company. Don’t think you and your company can’t attain such a culture of innovation—you can, and with the right help, you will.

I have researched and written much on this subject and would be honored to share more with you. If I may be of assistance to your company, please let me know.



Can Entrepreneurship be Taught?

I have been asked many times, “Can you learn entrepreneurship in a classroom, or only through real-world experience?” Similarly, I’m asked if entrepreneurs are made or born. I answer these questions with a story. I was a pretty good wrestler in New Jersey and was taught by one of the best wrestlers in the world, Mean Gene Mills. Gene was a sight to see on the mat. It was an art when he wrestled. Gene just had it. I, on the other hand, did not have the “it” and few people do. Nonetheless, I still did very well, because I perfected the necessary skills as taught to me by Gene. The same idea applies to the great entrepreneurs of our time; some people are born with the entrepreneurial drive, mindset, and skills, while others must learn them.

How does one know if they are a natural born entrepreneur? There isn’t a test you can take, but there are a few signs to look out for:

1.    Hate the status quo. You hate just going through the motions, doing what you’re “supposed to do.”

2.    Easily bored. You are simply not loving what you’re doing while working for someone else.

3.    Fired from jobs. You get fired more often than you’d like to admit. Hint: telling the owner what you think when they don’t ask is not a good thing!

4.    Resist authority. Resisting authority was my favorite thing to do as a kid, but doing so got me into a lot of trouble. I would always have to ask the question “WHY?”

5.    Ready to improve everything. You are always looking for ways to streamline and improve processes, policies and procedures.

6.    Not normal. You probably feel different from those around you. Until I realized I was different from my friends, who are 9 to 5 type of people, I always felt different. Then I jumped head first into entrepreneurship, risking everything and that’s when it all changed. Turns out, I wasn’t “normal” in all the right ways.

If none of these resonate with you, but entrepreneurship is something you are passionate about, then don’t worry, the game isn’t over yet. Just as I learned how to wrestle, you can learn how to think and act like an entrepreneur. Allow me to explain my front-row view of how entrepreneurship is changing the face of education and the ever-developing business world.

As a retired entrepreneur who started ten companies and sold them all, I felt a calling to go back to school and get my MBA, so I could teach what was so freely given to me by some of the best mentors. I’ve had the honor to teach entrepreneurship at University of Virginia and, most recently, Felician University. I have learned and experienced a lot about the entrepreneur and am happy to share some of that with you in this article.

We have seen entrepreneurship take root in the curriculums of universities across the country, and its appeal has spread from business schools to disciplines as varied as art, nursing, engineering, education, and many others. Courses offered in entrepreneurship have grown approximately 20-fold. In 1985, there were about 250 courses offered in entrepreneurship at college campuses across the nation. In 2008, that number grew to 5,000, with over 2,000 schools teaching entrepreneurship and creating accelerators and incubators within the schools of business (Kauffman Foundation).

So many of the lessons that I had to learn the hard way are exactly what I teach aspiring entrepreneurs, so they can avoid repeating the same mistakes I made. I teach entrepreneurs indispensable skills and insights that change how they approach their businesses. This can be done in many environments, ranging from universities, to incubators, accelerators, and even mentoring programs. A few of the lessons I teach include how to evaluate opportunity, how the entrepreneurial selling of your company differs from the professional selling of a product or service, and how to effectively communicate about your business. I also teach about some of the pitfalls of agreeing to 50/50 equity splits that are sealed with a handshake at the outset of a new venture. Students learn to highlight tools that improve processes, procedures, and productivity. They also learn how to use data to uncover patterns in the success and failure of new ventures that highlight the consequences of decisions.

I also teach another part of entrepreneurship that is crucial to success: Customer Discovery. Applying the discipline of Customer Discovery can help entrepreneurs avoid spending time and money building a product or service that no one wants to buy. Founders will also learn the skills of negotiation with investors, presenting to clients, marketing a product or service, and even how to hire good, qualified employees.

So, in a nutshell, the answer is YES, entrepreneurship can indeed be taught. It’s the “how to” that really matters; that is, how to do certain things, perfect certain skills, and learn how to ultimately think and act in an entrepreneurial way. Below are a few concepts and processes that students need to walk away with. They must know the “how to’s” of the following:

  •  Identify– opportunities.
  •  Market Research- Evaluate ideas and assess the market.
  •  Value time, money, and work hours– Appreciate the risks and rewards of entrepreneurship.
  •  Customer Discovery– Leverage experiments to validate your idea and refine your business model.
  •  Financials– Discover the key financial decisions any entrepreneur must make in the early stages of a new venture.
  •  Investors– Understand the process of raising capital, and how to speak to investors and understand their “Term Sheets,” which outline business agreements.
  •  Mentorship– Learn from successful entrepreneurs and leading investors, as well as peers.

If you can grasp these concepts and skills, you can enter the field of entrepreneurship; a field defined by breaking the rules, boundless innovation, passion, and even fun.

It’s true, some people are born with an entrepreneurial mindset or skills, and will excel naturally, while others may be a fish out of water and struggle to reach the same point until they learn and perfect those skills over time. People not born with the “it” of entrepreneurship can still learn how to become entrepreneurs, but they must be willing and able to learn things extremely fast. Your success rate increases with each class you take and skill you learn. But, beware, it takes a lot more than some slick power point presentations and nice new entrepreneurial textbook to become an entrepreneur. It takes a lot of grit, risk, and tenacity. Do you have what it takes?

If you’d like more information, please feel to contact me at