I had a conversation with Jeff Kearl at Logoworks yesterday regarding the information that I received about the company doing poorly. According to Jeff my source “couldn’t be more wrong”. I asked him to send over a statement for me to post here. So here it is strait from the horse’s mouth: 

Chris:

Thanks for the call today. Just to reiterate, our company is doing very well from a financial perspective and we are disappointed that “sources” would indicate something different than that to you. To clear up any misconceptions and set the record straight, August was the best revenue month in the history of our company and we continue to have a lot of positive momentum in the marketplace. While I’m quite tempted to discuss our financial position in greater detail to counter your blog post, I’ll refrain as keeping that information confidential is usually an advantage for private companies. That said, we are not in “financial dire straights” and over the next several months we’ll make some announcements that should publicly dispel that statement.

Best,

Jeff

As many of you know, the Utah Search Marketing Conference - U|Tech - is being held on October 18th at the Miller Innovation Center.

Janet Meiners has put a ton of work into this conference and so far sign ups aren’t that great. The conference is going to be amazing. Specifically, the conference is for small businesses that are trying to figure out how to market on the Web.

Please blog about this event and help Janet get as many people out as she can get there.

When I was in MBA School I had the rare opportunity of being mentored by business author and consultant, Chuck Coonradt. It was an experience that greatly helped me in my personal life and in my career.

Chuck is the author of The Game of Work, Managing the Obvious, Scorekeeping for Success, and the Four Laws of Debt Free Prosperity. I highly recommend reading these books. Chuck has over 30 years of consulting experience. He’s consulted with Pepsi, Quaker, Purina, Boeing and Safeway to name a few.

I met Chuck yesterday for lunch and he announced that he is in the process of writing a new book on management. I was very excited to hear this news. I think its about time he put out another book and Chuck’s material is pure genius! The book is slated to be released in the fall of 2007. Stay tuned for more information.

This post was spurred on by a phone call I had yesterday morning followed by a blog post I read this afternoon. Where do things stand in Utah’s entrepreneurial community? Unfortunately, I don’t think it looks good right now.

I didn’t live in Utah when Novell and WordPerfect came into existence but I am sure it was an exciting time. I’m sure that people looked at the progress the state was making then and almost surely thought the sky was the limit. We’ve had some “base hits” but alas, we really have nothing to look to as a true “homerun” success. Am I wrong? Let me go down a quick list of things that immediately come to mind:

• Provo Labs, the heavily watched Internet incubator launched in December 2005, no longer exist in the form it was operating in over the last eight months. I will make no more comments here (plenty has been said elsewhere) except to say that I hope Paul pulls it off and I hope the guys at PLS can make it work on their end. See Paul’s post on the changes at Provo Labs here.  
• Logoworks recently landed at number 66 on the Inc. 500. I can tell you from very good sources that the company is in financial dire straits and that sales have been declining since April. I hope they can pull it off as well because I really like their model and I think its a much needed service. Can anyone shed some light on the real situation at logoworks?
• The state is infested with “mentoring” and call center businesses. Go to ripoffreport.com and type in the name of any of these mentoring companies - the site is full of customer complaints. These “companies” give Utah a really bad name. I had a friend who recently exhibited at a trade show and he had several potential customers visit his company’s booth. When they found out his company was from Utah, they stated that they been ripped off by Utah companies in the past and that they would never do business with another Utah company again. Sad.
• SCO still struggles to make a case against IBM on their linux claim.
• Lovesac blew through many millions of dollars and is now down to only a couple of employees and stores after filing for bankruptcy earlier this year.
• Last year Canopy Group imploded and several people associated with the fund committed suicide.
• My friend John Jonas was sued by Microsoft after a story published about him in Wired Magazine. Many people have wrongly assumed that John was sued for splogging but this is not the case. The suit is in regards to domain copyright violations.
• Novell continues to reduce headcount at their Provo facility and lost several members of their executive team including their CEO. The company can’t seem to get their linux strategy figured out. The rest of their products are basically used by universities and governments.
• Myfamily.com is reported to be having problems as well. The company has struggled strategically for years and they are way behind the eight ball when it comes to innovation. I understand that its a tough time to be an employee at MyFamily.
• Utah is a bastion for multi-level marketing. They’re everywhere. Now, MLM’s employ thousands of people and have greatly contributed to the economic development of the state. However, many people do not consider MLM a legitimate way to market product. This tends to reflect poorly on the state. I have no personal opinions on the legitimacy or illegitimacy of MLM. There are negative and positive aspects to consider. What do you think?
• Patrick Byrne has become so obsessed with naked short selling that some believe its started to hurt Overstock.  According to many Overstock insiders, Patrick’s obsession has been a big distraction to the success of the company. I think naked short selling is a problem but how far is too far?  Still, I can’t help but to admire his tenacity.
• I was very disappointed by the “poison in the well” debate that occurred in Connect Magazine last year (its still a hot topic). While I think the debate is healthy and I applaud Connect for helping to bring the issues to light, the tone was ugly and illustrated the divide in the state between some angels and VC’s and entrepreneurs in Utah.
• iMerchant/StoresOnline are back in the news as well. The government claims the Orem-based business misled customers and that the states consumer affairs department turned into a “customer service” department for iMerchant because of all the consumer complaints. Will these guys ever get legit?
• In today’s issue of The Salt Lake Tribune there is a story that highlights still common stereotypes that hurt our ability to attract businesses to Utah. Read about it here.

I have a friend who is seeing great success in his Utah-based Internet business. Recently one of the states better known VC’s called him up and asked him to lunch. They sent a junior associate who ultimately had the wrong time and date for the meeting and never showed up. Contrast that to a bay area VC who is making a special trip out here to visit my friend. They’ve been very sensitive about his time and are making special considerations to make sure the trip is worth it for them and him.

That story says a lot to me.

So what’s going on that’s positive to report? I think now really is the best time to start a business in Utah. As a matter of fact, I write about it in the cover story of this months issue of Connect Magazine. Be sure to check out the article when the issue hits news stands later this month. There are a lot of high potential start ups in the state (Funding Universe, Podango, Hirevue, MediaForge to name a few) and guys like Alan Hall are leading the way to exact change in Utah. I’m also very encouraged by the Omniture IPO as well as the success at backcountry.com

But when will we really turn the corner? What do you think needs to happen in Utah to bring about real success and change?

Here’s a great article from The Economist on YouTube’s quest to find a revenue model. The article also illustrates some interesting problems with video-based advertising.

I read the other day that YouTube may not worry about a revenue model. The idea is to sell the company to someone else, like a big entertainment company, and let them figure out the model. That might be a good move given that the two guys who started YouTube haven’t done much else in their lives to prove they can make the business work. I’m still betting on a $1 billion plus acquisition of YouTube in the next 18 months.