and hotel mogul tells small business owners about the importance of being flexible. we will have that and so much more coming up next on "your business."

hi there, everyone. i'm jj ramberg. welcome to "your business," where we give you tips and advice to help your business grow. in a world going paperless, institutions like the post office and traditions like ingraved wedding invitations are quickly becoming a thing of the past. a brother and sister team saw there was a need for high end online stationary. their approach to bringing an off-line product online changed the landscape of the industry so much that its biggest competitor is taking no tuesday. if you are like most americans, your life has gone electronic. you shop, bank, pay your bills and send e-mails all online. and even though there are plenty of ways to send digital invitations, when it came time

to send one for his 21st birthday party, james was shocked he could not find a classy digital invitation anywhere on the web. >> i was between a rock and hard place because they did not have a budget to send paper invitations, but i also found the existing products for sending invitations online were not as customizable and not as beautiful as what i would have wanted. >> the internet was full of sites that were a little more junky and low end and didn't feel high touch or have that emotional high quality. >> james, a sophomore in college saw an opportunity, and what better place than harvard to have the next big idea. >> people want to go on the internet and check out their friends, so why not offer something that offers friends and profiles. >> i got to harvard in 2006, and there was a really pervasive era

of opportunity in the week of mark zuckerberg's leaving harvard and starting facebook, and there was a sense with a little creativity and a lot of work you could create a company on the web that would really affect people's lives, and that rubbed off on me. >> the idea was simple. create a company that would effectively translate the look and feel of a tangible high end paper invitation to the digital realm. the first he shared his concept with was his sister. >> he talked about the tooth of the paper, and i did not know paper had teeth, and that idea of starting out with something that had the visual qualities in the off-line world that people understand and having it be the most beautiful version of that online, hyperreal and lux

juryious. and they pulled money from their own savings to start the paperless post. >> from inception to launch, we had a little bit of a slow road because i was in school for a lot of the time and building a team as a first-time intrapreneur and it was one of the most difficult things we had to do. it took us about a year and a half to get to a place where we could allow outside users to come on and use the site. >> the idea quickly took off, gaining traction and new customers every time somebody received a paperless post invitation. the founder of buzz feed was so impressed when he received a paperless post invite that he eventually became an adviser and mentor to the pair. >> people are receivers first and then they get a few and then they say i keep getting beautiful invitations and it's usually from a friend of mine that is high status or a person

that i respect and maybe i should go and use the service, and it spreads that way. >> more affordable than paper stationary, and environmentally friendly and fast, paperless post quickly attracted many institutions. >> the website is really simple to use. >> it's nice to send something that is going to reflect all the effort and energy that you put into the party. >> with 50 million invitations sent and a service that is very low cost, everybody is taking no tuesday, even the industry's largest player. e-vit recently launched a site similar to paperless post pichlt there's lots of examples of big companies trying to copy what the nimble startups are doing, and they have a lot of trouble, actually, more than you would expect. i think in a way it validates the market, and i think what you will see is paperless post continuing to innovate, because

they are not copying but inventing this stuff, and when you are the one inventing you understand the ideas in a deeper way. >> you copy something you think is the standard, and you don't copy an 11-year-old competitor saying what we are doing is the future, and it's not just what we're doing, but exactly what we're doing. so should paperless post be worried about the 800 pound gorilla in the industry getting into their space. the principle of a capital firm focused on media and technology, and michael sims is president of the program that brings entrepreneurship to colleges and universities. i love this story because he said in the piece, big companies

often copy smaller companies and fail. e-vite it's exists. why is paperless post can be so confident? >> i think paperless post is an innovative company, and he said it well, and they came out with an idea that was fresh, and e-vite had a product that was stale, and it didn't feel right to some people. they came out with something fresh and unique and beautiful, and the beauty of an invitation service on the web is that every recipient is a potential customer. there's a natural virality built in the service. and they focus on product first and foremost, and building a wonderful product people love to

use, and they architect a simple service and branded service around that product that grows virally as each person touches it. >> and anybody can duty same kind of thing, and copy the same kind of thing, and you grow your base, but when somebody comes in new and has a bigger base, what do you do as the person who is running this company so that you don't get distracted by the competition? >> i think it varies by industry. you think about the main street business, i think one of the hugest assets is you as an individual. you will be more passionate about the idea and closer to the market, and you will be able to talk to the market more and build closer relationships. i think for the average main street business, that's a huge advantage. in the case of the online business, you know, joana and james and alexa, they really have the understanding of the taste of the market and to get the virality, so i think they have a lot of advantages.

i would be worried but at the end of the day i would be validated that the large company is making a big change based on our actions. >> i think you always have to expect as a young company, as a startup, if you go into an area that is promising and you have success, you have to assume that the 800-pound gorilla will come into that space at some point. and when -- first of all, you should be paranoid that they are going to and even more paranoid if they don't. if they don't, and most paranoid if they don't and even more if they do. but there's a balance between paranoid, which kind of lights of fire under you, and distracted. so i think knowing alexa and james, i am sure they're looking at it and paranoid about it and all it does is say we need to move faster and we have to have more people touch the product, because they have been at this

for a couple plus years, almost three in market, and people know their brand. the brand paperless post means something now. when i get an invitation or you get an invitation from paperless post, there's a certain, you know, quality to it, it feels good, there's a sexiness to it, and it has the higherend positioning. you can come in and rip them off exactly, but it's difficult to replicate that magic. and knowing them they will continue to innovate on that product as much as possible and continue to brand that in the marketplace. nobody will come in and say i have a bag that looks just like this bag, and people will say, that's my bag, and i think they built something successful to brand. >> thank you, guys. >> thank you. if your website is subpar, you are going to lose peoples' interest right away. here now are five necessities to make your company's site a great

online resource courtesy of intrapreneur magazine. number one, a clear description of your business. a visitor should not have to search around to figure out what you do. sum up your products or services right on the home page. two, a sensible web address. your domain name is like your brand so it should be easy for your users to remember and type. three, make your site easy to navigate. consider using drop downs so visitors can see the dropdown from any page. and four, fresh quality content. add a regularly dated blog or connect your social media feeds to keep things fresh and relevant on your company's website. and use the correct key words throughout your text, and put in plenty of links and include images throughout your site. studio 54 was the hottest ticket of its day. his cutting edge hotel, morgan's

reinvented the style for chic hotels. and he is now turning heads with a collection of exclusive hotels around the world, including the brand-new public chicago hotel on the coast. we caught up with the trend-setting intrapreneur, to find out how to manages to build buzz and withstand the economy. ♪ >> it's an instinct, a feeling that this is what is happening, that this is what people are going for. when we opened up studio 54, we were in a bad neighborhood. a lot of street people. we wanted to keep the street people out. so we put up the rope, and then that kind of turned into a bit of a frankenstein monster that

smacked of leapershipism. it was a good idea when we did it, but i think the time has come and gone. ♪ >> the way we market is just by increasing your presence in the marketplace. we have a very successful restaurant here and it's a new idea because it's very simple food, and very low priced and done by a gourmet chef. john george. he came out with a book, you know, and of course i have no interested in selling the book, i want to sell the hotel, so i thought it would be the perfect time to have a party for the book and introduce john george and the people of chicago and explain his idea directly. ♪ >> nothing matters but the product. if the product is good, everything else kind of falls into place. you come out with great product,

really distinct and unique, and the buzz and the success of it is a natural consequence of that. it's not about marketing, execution, distribution and in my business, reservation, services, no. it's about distinctive product. ♪ >> you do a restaurant in london, they don't like music during their meal. and there's nothing right or wrong about having music, just different customs and cultures and you have to be sensitive to that. it's like when in rome. you know, i think that something in miami wouldn't work in chicago. and wouldn't work in new york. it's a kind of very distinct kind of ambiance in a city like new york where we have five

boroug boroughs. each borough is different and each neighborhood is different. it's not hard to find the sign posts but you have to get out there and figure out what they are. in bad times, when there's a uncertainty, there are certainly voids in the marketplace that you can pick up on and fill. it was not about the economy. that will change. the bad economy is what made me focus on the value and the price, and then i realized that i thought that people wanting to get a good price was not about the bad economy, it's a paradigm shift. people want value for their money now. if you are like i am, bad times make people react to the bad times and behave a certain way, and you can seize a certain

opportunity. ♪ still to come, howa are dating and owning a small business similar? the answer may surprise you. and then the elevator pitch, treated to chunky chocolate. sam: i'm sam chernin. owner of sammy's fish box. i opened the first sammy's back in 1966. my employees are like family. and, i want people that work for me to feel that they're sharing in my success. we purchase as much as we can on the american express open gold card. so we can accumulate as many points as possible. i pass on these points to my employees to go on trips with their families. when my employees are happy, my customers are happy. vo: earn points for the things you're already buying. call 1-800-now-open to find out how the gold card can serve your business.

valentine'sday is coming up, and if you want to give sweet treats to your sweetie, here is a thought. today's elevator pitch hope their chocolate will melt hearts. >> good morning. my name is jerome and this is kevin. we're the cofounders where we make all-natural chocolate bars. although we use the highest quality and ingredients, it has a fun nature and accessible price point. our use of chunky size ingredients and fun flavor combination led some to call us the ben & jerry's of chocolate.

>> we have national and regional distribution in over 150 stores. we are seeking $500,000 for equipment and marketing. in return, we're offering a 14% return. >> these people did not take one bite -- i will get one in, thank you. they were eating the whole thing the whole time. so you are a venture capitalist, and you listen to pitches all day long and how did they do? >> well, actually. it was tight, concise. you made your point clearly. i have a handful of questions i would ask. but i think you did what is really important in a pitch, which is incap saw late what you do and what is different about what you do s, and that's easy

do when you are making chocolate versus making a website. >> all right. what about you, michael? >> i loved the sample and i thought that was a great element. i would also add that i love to hear more about the traction, you have $180,000 in revenue over the past couple years, i would like to hear more about that and your plans of how you can scale that larger, because at the end of the day it tastes like a good product, but it will come down to the execution. >> all right. moment of truth. i think i know the answer. if this was the kind of industry you vested in, would you take another meeting? >> i would try to make this meeting go a bit longer, because my questions are really about, you know, five years is a reasonable amount of time, and $180,000 is still relatively a modest amount of sales, and in order for venture capitalists or an investor to get a return on

their dollar they need to build it into a sizeable entity. the growth story and how you differentiate not my day-to-day but something i know pretty well, it is a tough category. i would try to dig in on what you have done today and where -- how you are going to be able to cross it is chasm. >> what i think i'm hearing is they piqued your interest enough. >> i commit my mouth from 30 to 60 minutes i love the product and presentation. the same as mo. i want to see more of the story. were you working full time during that time or part time? and then, you know -- you take it higher. >> all right. that's great. thank you for bringing your idea here and chocolate. thank you for all of your advice. and if any of you out there have a product or a service and want steve back from our elevator pitch panel on your chances of getting interested investors send us an e-mail. the address is yo

yourbusiness@msnbc.com. please include a short summary of what your company does, how much money you are trying to raise, and what you intend to do with that money. you never know somebody out there watching the show may be interested in helping you. time now to answer some of your business questions. mo and michael are with us. the first is about developing a rapport with customers. >> how do we see a red flag in business? we know what to look for in dating but how do we know if investors are seriously interested in our business or not. >> you want to get any customer you can get. next thing you know you spent three weeks on someone that may not sign up or turns out to be an unproductive client. >> i personally -- i love pre-orders. a lot of people just because they don't want to have the auction sxward say no, they will say they are interested or interested learning more when they are not. i would say the majority of people so the sooner you can get to the point where you have them say actually pull out their

checkbook and pay for something in advance before it is made, then i know i'm on to something. >> i just want to know how they -- how they know how to do this in the world of dating. that seems tough. >> yeah. >> assuming they figured this outlet me know. i would say a couple of things. one, i think honesty is really, really important. i think that as a presenter as well as a recipient meaning if -- it is very disarming when somebody comes to you and says here is what we are doing. they give you like a really quick pitch. and this may or may not be for you. totally fine either way but just kind of want to have a sense of where you are and put it on the table. and it disarms the whole thing. like all of a sudden the people the other side as, you know, worried about hurting their feelings, et cetera, because you sort of -- you own it right there in the moment. i think that's incredibly important. the other thing is just the process thing. you have to have a very tight

process for how you do these things. like a very brief pitch, way you follow up, and a very dlekt way of saying, you know, if you are interested let's move this forward and if you are not that's okay, too. i think that, you know, you can use those simple devices to -- they are fairly effective believe it or not. >> let's move to the next one. e-mail from rona. we are a self-funded online ad agency one-year-old. at one point in our growth should we seek investors? >> i have a very simple answer for that. when you need them. never raise money if you don't have to. there's nothing better than having, you know, nobody's hands in your cookie jar. if you get to a point you want to grow your business at a certain trajectory and don't have capital do so you start looking for investors. but short of that, keep doing what you are doing. >> i would say really depends on the industry and personal preferences as well and how much you want to be diluted and how much you -- is this a lifestyle business? many people do start businesses for that reason. so -- i would look at those things and whether you -- you

have competitors as well. >> if you feel like at some point you are going to need invest wrors and you don't need them now, i ask you this because you are a venture capitalist shouldn't you start developing relationships? >> yeah. i think that -- any entrepreneur that thinks that they are in a business other than lifestyle business, if you are in a lifestyle business the goal is to keep everybody outside of your life, but if -- you are in a business where you are trying to grow it as big as possible and have big apple biggests, now or in the future, it is definitely important to have relationships in the financing community. just like you would with any other constituency or stakeholder, whether it is the press or, you know, whoever you need to get media on your company, angst to learn. >> when you need it, you don't have to go through the first stage of figuring out who these people are and meeting them. >> relationship building. >> let's move on to the last question. this is about how to deal was customers. >> i would love to know how ideally sort of deal with

persons who are price sensitive, hotels price sensitive. >> price sensitivity. that's tricky. as a small business, you are probably never going to be the lowest person there. >> i deal in the edge indication business. when we were launching, people were complaining about price and now people complain about price. i think that -- i would would be -- in the beginning i like giving away things cheaper to see if there is engagement in the idea works. with it works i want to stay firm. fund manically the people that purchase at a 1345u8er price may not be your target margaret. you don't wouldn't waste your time with a cuff when you raise your price. >> i also think that generally, you know, it is all about value delivered. right? if you deliver the requisite value people get less sensitive about price and look, it starts with -- knowing your customer.

going at the right customer. if you have a product that cost as certain amount of money and targeting bargain hunters you will have an issue. you have to make sure your customer and your product are aligned and then deliver value for services. >> i love that point, though. as we talk a lot about price, but really what everyone should be concentrating on is value. >> i think that actually when you talk to your customers, you have to speak in that language and frame what you are delivering around. let's talk about the value delivered here. as opposed to the price. it is a little bit -- just subtle and an orientation thing. but i think it is -- >> incredibly meaningful. >> i find it playing the hard to get. if you say we may not be a good fit then sometimes people want to come back to you stronger. they have more respect for you. >> all right. okay. guys, thank you for the advice. very helpful. we appreciate it. and if any of you out there have a question for our experts, just go to our website. the address is openforum.com/yourbusiness. there just hit the ask the show link to submit a question for our panel. again, the website is

openforum.com/yourbusiness. if you rather e-mail us your questions and your comments. the address is yourbusiness@msnbc.c yourbusiness@msnbc.com. mo and michael had helpful advice about how to improve your company. now let's get great ideas from small business owners like you. >> my advice to other entrepreneurs cross train your employees to do not just one activity but do several activities so when slow times come around take advantage of them and keep good employees working. overall the employees do appreciate that. >> for latino entrepreneurs, you have a business, adjust for the american culture. >> run your own business, the first problem is you are running your own business. stop that. let someone else take care of the little things and push off as much as you can with someone else. not the important things and nothing about money.

you do want to focus on where your money is going. >> looking to get your business online but not sure where to start. check out our website of the week. it is a website builder where no html or web design skills are required. you can choose a design template, customize it and then go live. changes can then be made any time you would like. setting up your own website costs about $20 a month. to learn more about today's show just click on our website. it is openforum.com/yourbusiness. you will find all of today's segments plus web exclusive content with more information to help your business grow. become a fan of the show on facebook. we love getting your feedback. you can follow us on twittwitn . next week, starting and running a successful food services business. you need a entrepreneur who looks at a building that saw not

one, not two, but three different business concepts. >> i'm pretty crazy but not crazy enough to just want to open up three businesses that close together. >> we will tell you how she fit two restaurants and one bar into one space. unt we make your business our business. shazi: seven years ago, i had this idea. to make baby food the way moms would. happybaby strives to make the best organic baby food. in a business like ours, personal connections are so important. we use our american express open gold card to further those connections. last year we took dozens of trips using membership rewards points to meet with farmers that grow our sweet potatoes