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Right From the Start

Right From the Start. Best Practices for Launching a Successful Association or Consortium. About us. Andy Freed, Virtual, Inc. Andy Updegrove , Gesmer Updegrove , LLP Between the two of us: 120+ consortia and associations 40 years of experience From formation to merger or sunset.

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Right From the Start

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  1. Right From the Start Best Practices for Launching a Successful Association or Consortium

  2. About us • Andy Freed, Virtual, Inc. • Andy Updegrove, GesmerUpdegrove, LLP • Between the two of us: • 120+ consortia and associations • 40 years of experience • From formation to merger or sunset

  3. Why Start An Association or Consortia? • To tackle a unique business purpose - like launching a standard • Develop the standard • Promote it • Brand and certify it • To advocate for an unrepresented (or emerging) market segment • Raise its profile • Rally supporters and leverage resources

  4. Why NOT to Start an Association or Consortia • There isn’t a critical mass of members to garner sufficient financial and tactical support • There is a dominant player in the same space that is already serving the needs of its constituents

  5. The Eight Fatal Flaws • Legal missteps • Hiring too fast • Lacking a sales plan • Setting dues before determining budget • Carelessness in designing the membership class structure • Not sweating the details • Having the wrong board • Launching before you’re ready

  6. The Eight Fatal Flaws • Legal missteps • Recreating the wheel – don’t be creative to no purpose • Don’t be too controlling – standards are about giving things away • Intellectual Property Rights (IPR) Policies can be a stumbling block • Ignoring antitrust laws Best Practice Tip There’s more to setting up a consortium than marking up another one’s bylaws. Hire someone who knows how to structure for success.

  7. The Eight Fatal Flaws • Hiring too fast • Determine staffing structure and strategy before committing on people • Executive directors wear many hats, you need to determine which is the most important: • Managing technical initiatives • Recruiting members • Driving advocacy agenda Best Practice Tip Wait to make staffing commitments until the organizational structure is developed

  8. The Eight Fatal Flaws • Lacking a sales plan • Getting members in the door is always harder than you think • Getting them in the door takes longer than you think • Understand what motivates potential members Best Practice Tip Use the “Amway” model to drive a growing sales force from early sign-ons. Consider regularly scheduled informational webinars to support the sales process.

  9. The Eight Fatal Flaws • Setting dues before determining budget • Need to determine needs of the organization and the universe of members before setting dues amounts • Many organizations ensure their failure by setting their dues too low • Set budget for 1.5 times of first year cash flow to develop cash reserves Best Practice Tip Develop the first year expense budget and a reasonable list of potential members. Divide the expenses by the membership number to develop your first year average dues.

  10. The Eight Fatal Flaws • Carelessness in designing the membership class structure • Figure out what types of members you need (i.e. big, small, vendor, end user, government, etc.) • Design the classes (rights, obligations and dues) to create “value propositions” • Dues can scale by revenues, type of entity Best Practice Tip Benchmark against other organizations.Use sources like ASAE and Guidestar to garner benchmarking data

  11. The Eight Fatal Flaws • Not sweating the details • Responding to inquiries • Sending out P.O.s to those that need them • Bank account details • Deficient website at launch • Website logins Best Practice Tip Don’t open the doors until you’re ready to sell.Look at software packages that help manage the membership process.

  12. The Eight Fatal Flaws • Having the wrong board • “Who is on the board?” is the first question press and prospective members will ask • Geography, industry sectors represented, “marquee value” all send powerful messages • Board members are critical volunteers - are your board members willing to put the time in? • Size matters! (Neither too large nor too small) Best Practice Tip Don’t be afraid to hold some seats open to get the right mix.

  13. The Eight Fatal Flaws • Launching before you’re ready • People are predisposed to think new organization’s will fail—don’t reinforce that impression • It will be years before you get as much attention as the day you go public, so don’t waste the opportunity • An impressive list of founding members is key! Best Practice Tip You control the launch date—don’t launch until you’re ready.It’s better to delay than make a bad first impression.

  14. Questions? Andy Freed afreed@virtualmgmt.com +1 781-876-6205 Andy Updegrove andrew.updegrove@gesmer.com +1 617-350-6800 • Additional Resources • The Essential Guide To Standards/Forming & Managing a Standard Setting Organizationwww.consortiuminfo.org/essentialguide • Seven Habits of Success New Associations www.virtualmgmt.com • Ten Reasons Why Associations Fail www.virtualmgmt.com • Ten Strategies for Association Membership Recruiting & Retention www.virtualmgmt.com

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