M & A Rainmaker

Lichfield businesses have been subjected to an incredible outbreak of Wahooliganism. Wahooliganism first emerged in Minneapolis in the U.S. last year and then spread globally via highly connected individuals and internet influencers.

It gained serious Klout along the way but suffered a setback in early February. It is expected to re-emerge over the coming weeks stronger than ever and businesses in Lichfield and indeed globally are advised to prepare.

What is Wahooliganism ??

A short description proffered by Wahooly founder Dana Severson is  ” Accelerating Start-up growth through online influence. “

There’s a good description of Wahooly in TechCrunch here:

http://techcrunch.com/2012/02/01/wahooly-launches-its-crowdfunding-experiment-with-first-3-startups-ready-for-social-capital/

Wahooly ( a start-up itself ) is helping it’s first 3 start-up’s ( actually on the website there are 4 now – http://wahooly.com/ ) to gain traction by having ” influential people ” invest time, effort and skills in them and promote them on a global basis.

Does this actually work ???

Well I think it does. Word of Mouth Marketing,Networking and Referrals are established ways of ” getting the word out ” and ” growing the business “.

For those of you who have read Gladwell’s ” The Tipping Point ” you will know that “The success of any kind of social epidemic is heavily dependent on the involvement of people with a particular and rare set of social gifts.” These people are Connectors, Mavens and Salespeople.

According to Gladwell, economists call this the “80/20 Principle, which is the idea that in any situation roughly 80 percent of the ‘work’ will be done by 20 percent of the participants.”

The 20% are defined by Klout ( arguably ) as those who have a Klout score of greater than 45. ( Klout is only one company that is measuring Internet ” influence ).

This is not really rocket science – you get influential people ( in real life and virtual life ) to promote your company, products and services and this helps you grow your business.

Let’s take two examples:

Twylah ( http://www.twylah.com/ )

Twylah is a company that wants to take your Twitter Tweets and ” Tell your story and get you noticed ” by making an awesome looking website out of your Tweets. Twylah is based in San Franciso and is a start-up with co-founders Kelly and Eric Kim. Kelly is the community manager for Twylah and the marketing face of @Twylah.

Twylah has some VERY famous clients already ( see http://www.twylah.com/featured ) which include Lady GaGa, Britney Spears, Bon Jovi and Arnold Shwarzenegger !! This might give you the impression that only famous people need apply ! Here is David Skok of Matrix Partners Twylah page http://www.twylah.com/bostonvc/topics/matrix ( A Boston based VC investor  ) and here’s my Twylah page  http://www.twylah.com/cwindley .

From small beginnings Twylah has spread globally – mainly by using Twitter. Kelly has some 13,000 or so followers on Twitter. By picking certain people ( famous, influential, interesting ) Kelly has spread the word on Twylah and now Twylah users are spreading the word further.

Coco Meli Bakery ( http://www.cocomelibakery.co.uk/ )

More locally, Meli Nicolaou, of Coco Meli Bakery is using various means to promote her Artisan Bakery business and newly launched refreshments van at Trent Valley Railway Station.

Meli (  @CocoMeliBakery on Twitter )

has a relatively small ( well at least to Kelly !! ) Twitter follower base ( 500 odd ) but she has used this to help spread the word about her business. She now has a Twylah page http://www.twylah.com/CocoMeliBakery .

Again, physically and online she is spreading the word and others are spreading the word for her – some of them are influential people.

The involvement of influential people is having an actual positive effect on the growth of the business. What is the value of a new Twylah customer or a new Coco Meli Bakery customer ?? I don’t know but Eric Kim’s background is in the monetisation of Internet platforms and to him ( and the industry he has worked in for the last 10 years or so ) each follower, retweeter, circler, favouriter, liker and email address has a dollar or pound ( or part of ) value !!

Start up Wahooly starts tomorrow ( Tuesday 31st January ) having used Klout to select it’s members. I realise that this is is all about as clear as mud at the moment !

Let’s start with Klout which is a company ( one of a few that are doing this ) that essentially grades your Internet influence. Here is Klout about Klout:

http://klout.com/#/understand

” Klout was founded in 2008 to help you measure and leverage your influence. We believe influence is the ability to drive action. For example, Oprah’s opinion on literature has inspired millions to read titles from her book club. But you don’t have to be Oprah to have influence. You influence your friend when she listens to a song you recommend on Facebook. You influence your coworker when he checks out an article you posted on LinkedIn and shares it with someone else. Social actions like these are a reflection of influence. ”

Klout uses a ” secret algorithm ” to measure people and brand influence.

A few month’s ago this algorithm was ” modified ” and a lot of people’s ” Klout score ” changed ( many for the worse ) generating considerable reaction from Klout ” members “.

A lot of people say ” Who are Klout and what right do they have to rank my influence ? ” I have my own issues with Klout including the fact that they have a lot of technical bugs that impact people’s scores.

Anyway – let’s get on to Wahooly. Wahooly is a start-up that aims to help start-ups by recruiting ” influential ” people to promote start-ups that they wish to support. In return the influencers get equity ( shares ) in the start-up. So, this is like hiring an Internet Marketing Expert ( Social Media Marketer ) and PR person and paying them in equity rather than hard cash.

Will it work ?? We shall see.

To be a member of Wahooly you needed to have a Klout score of 45 or above ( mine was at the time of selection but has fallen slightly since. I have been as high as 67 in the past ).

More on Wahooly’s use of Klout here:

http://www.launch.is/blog/wahooly-uses-klout-to-add-400-influencers-daily-who-earn-equ.html

I am therefore a founder member of Wahooly and a Wahooligan ( as they call it ).

Given that it has been very hard to raise start-up capital in the last few years there have been many new initiatives to help start-ups get going. Equity for influence is just the latest of them. There have, for example , been a whole host of crowd financing ( investing small amounts of money for small amounts of equity ) initiatives.

Obviously Wahooly has a presence on the main social media platforms:

Facebook

https://www.facebook.com/wahooly?ref=ts&sk=wall

https://www.facebook.com/groups/Wahooligans/

Twitter

https://twitter.com/#!/TeamWahooly

Google +

https://plus.google.com/u/0/105465481469156419624/posts

Linkedin

etc

It is going to be an interesting experiment !!