The reason innovation requires leadership is that the person or team with a good new idea or clever new design starts out as the only ones who really “get it.” Their insight and enthusiasm will blink out after a while, and nothing new will actually get implemented, unless they exercise some real leadership. They have to spread the word, line up support, overcome skepticism, and generally act like focused, skilled leaders. Otherwise, their innovation does not stand a chance.

Innovation is, in my book, quite simply a fertile union of creativity and leadership. Thus you might say that the term ‘innovative leadership’ is redundant and all leadership is innovative. That assumes people in leadership roles really are leading, as in visualizing the new and better and moving us in their direction. Sadly, real world leadership is more prosaic, and less innovative. In fact, in almost every survey ever done on the topic, employees say that their leaders are holding them back, not drawing them ahead, in the quest of innovation.

Investors invest in people, not ideas. Customers buy from people, not companies. Employees rally for a great leader. As an entrepreneur, you need relationships to succeed. That means relationships with team members, investors, customers, and vendors. One of the best ways to build a good relationship with anyone is to make them feel important.

One of my favorite authors, Brian Tracy, in his book “No Excuses!: The Power of Self-Discipline,” outlined seven ways to make other people feel important, which I believe are extremely relevant to entrepreneurs and business:

Accept people the way they are. Because most people are judgmental and critical, to be unconditionally accepted by another person raises that person’s self-esteem, reinforces his or her self-image, and makes that person much more likely to accept you and follow your lead.

Startups don’t need – shouldn’t have – COOs. I have this conversation with every startup that comes to see me and has a CEO & a COO. I think usually a COO title at a startup is an ego thing. You have two founders and it was agreed that one would get the CEO role so the other needs to call themselves president or COO.

But ask yourself, what does a COO actually do? In a mature company it’s often like a presidential chief of staff. They will often run all of the daily reports into them covering off for finance, sales, marketing, biz dev & HR. Many times they also pick up product and tech, too.

Tens of thousands of Americans have a dream of owning their own business. For some, the idea of taking control of their worklife is a huge motivator. For others, it’s the desire to increase personal wealth that drives them. Whether you are looking to just replace your current income with an independent work life or are looking to be the next Bill Gates, you have to start somewhere. Here are five things you can do now to set yourself on the path to entrepreneurship.

1. Live Cheaply Starting a business guarantees you just one thing – you will be on a tight budget for some amount of time. It might be just a few months, it might take a year or so to build your company’s profitability, but your personal expenses will need to be under control before you start. Get in the habit of living cheaply now. Review your household budget (or develop one) and look for areas to cut back. Pay off credit cards, look for deals when you shop, clip coupons, find inexpensive entertainment options. The more you can control expenses now, the less stress you will be under during the early stages of your startup.

Despite the potential pitfalls, thousands of companies continue to incorporate design thinking into their business process, often with outstanding results. In an era when almost every product or service on the market is at least satisfactory and efficiencies have largely been optimized, innovation is still the most effective way for a company to differentiate its offering.

For the company that wants to begin pursuing this path, a new perspective is essential, whether it takes the form of a newly created internal innovation group, a shake-up of the executive team, or the engagement of a consultancy. In each of these cases, matching expectations with reality is crucial. In the case of the consultancy--my area of expertise--there’s also the relationship to consider.

While sitting in a group of young entrepreneurs at a panel discussion in Mountain View last month, I was struck by how many of them felt like they needed investor money simply to validate the existence of their companies. Having recently closed a $4.4 million venture round, I was there to speak about my fundraising experience as an entrepreneur, founding ReadyForZero, an online software program that helps people manage their challenging financial situations. The panel discussion--an exclusive event hosted by Y Combinator--was meant to introduce newly accepted YC companies to alumni who have successfully raised outside investment dollars for their companies and candidly discuss and demystify the process. Just one year prior, my cofounder and I had attended this very same panel discussion as a new YC team and listened to war stories from alumni and other inspiring entrepreneurs. I had come back to return the favor, admittedly, feeling only slightly more prepared than I was the first time.

As I listened to their questions, though, I noticed a lot of them started with something like: “This other company, that is doing something completely different than us, raised $X million last week...so we need to raise at least that much to succeed.” As a startup, it's common to compare yourself to other startups; in this case it was the only way they were measuring their company’s success.

A few weeks ago I was interviewed by Diann Daniel for an article she recently posted about healthcare IT careers. It’s worth checking out if you’re looking to enter the health IT field.

Here was my advice during the interview:

• Hiring managers are making a mistake if they aren’t looking outside of healthcare for filling IT roles. The only roles that can not be filled by outsiders are in clinical engineering and application-specific specialists. For all other infrastructure and integration work you can hire pretty much any qualified IT personnel and they will be able to help you. If you have a choice, then certainly go for the health / medical experience but these days we don’t always have the choice.

AngelSoft, a New York company that makes software for investors, is creating an online marketplace to introduce potential backers to entrepreneurs, betting on an uptick in financial matchmaking from the service.

Founded in 2004 by New York angel investor David Rose, 54, AngelSoft is launching the site for early investment in startups and changing its name to Gust today. The service, which is available to AngelSoft’s 150 venture-capital funds and 35,000 angel investors, adds features for entrepreneurs to post their progress confidentially as well as to manage investor relations.

Selling a business is not like selling a car. It is an ongoing process that can take a few years to complete. Not only must the owner find the right buyer, they must find a buyer at the right price, and someone who is willing to meet his terms. DO you want to remain with the company once the sale is complete? You must find a buyer who will meet your needs.

When Teresa Walsh, Bonnie Kelly, and Jerry Kelly decided to sell Silpada Designs to Avon, they discovered just how long this process could take. Although the company was sold last year, the process really began a few years before, reports USA Today.

On Thursday, President Barack Obama proposed the American Jobs Act to create new jobs for millions of Americans. A key component of the proposal is to reduce regulation for startups, especially in crowdfunding.

Currently, websites like IndieGoGo and Kickstarter offer the opportunity for people to contribute small amounts of money to new ventures. Under the President’s proposal, startups could offer equity to small scale investors, which might fuel a new wave of crowdfunding startups. Larger startups would have reduced regulatory costs for going public, with “mini” public offerings. Companies participating could raise up to $50 million, rather than the current limit of $5 million.

I remember my first video game console vividly.

I was in grade three. After a stellar report card, my parents took me straight from school to Zellers, where I received a brand new, Japanese-made Sega Genesis – a 16-bit gaming system with a blazing 8mhz processor (today’s smartphones are a mere 1000mhz).  It was my entry to computer-generated ecstasy and I’ll never forget it.

IRVINE, Calif., Sept. 13, 2011 /PRNewswire via COMTEX/ -- Tech Coast Angels (TCA), the nation's largest angel investment network, today announced the formation of the Angel Syndication Network (ASN), an affiliation of angel investment groups across the U.S. that have banded together to provide entrepreneurs with more and larger financing rounds before leaving the angel system.

According to Richard Sudek, chairman of the TCA Syndication Committee, "ASN is a dynamic new opportunity for entrepreneurs. Previously, start-up companies might go to a single angel group to receive their initial financing, but when they required additional funds, they had to go through the same due diligence at other angel networks. Or they had to try to make the leap to venture capital, sometimes before they were ready. Now, these companies can start up with any of our ASN partners and have access to the funds and support of the other groups when they need it. They can take any on-ramp and access the same freeway."

WASHINGTON — The Obama administration is investing billions of dollars to promote economic development in rural areas by bringing broadband service and small-business financing to regions with chronic poverty and high unemployment.

But critics say the administration has little to show for its efforts, which highlight the difficulties of creating jobs in remote areas. They say the money has gone to areas where it is not needed, to promote broadband where it already exists and for industrial parks designed to attract business and jobs that may never materialize.

In its State of the Population report in 2007, the United Nations Population Fund made this ringing declaration:  “In 2008, the world reaches an invisible but momentous milestone: For the first time in history, more than half its human population, 3.3 billion people, will be living in urban areas.”

The agency’s voice was one of many trumpeting an epoch-making event.  For the last several years, newspaper and magazine articles, television shows and scholarly papers have explored the premise that  because most of the world now lives in urban rather than in rural areas things are going to be, or at least should be, different.  Often the conclusion is that cities may finally get the attention they deserve from policy makers and governments.  This optimism dovetails nicely with a sizeable literature of urban advocacy chronicling the rejuvenation of central cities and extolling the supposed virtues of high-density city living, even predicting the withering away of the suburbs.

President Obama threw down the gauntlet to Congress today, releasing his plan for the American Jobs Act, a $447 billion legislative proposal to jumpstart the economy that creates a number incentives for employers to start—and keep—hiring. The plan includes a payroll tax holiday for small business that hire new employees as well as for those who raise salaries. Other incentives include cutting payroll taxes on the first $5 million in payroll and extending “100% expensing” that allows firms to take an immediate deduction on investments in new plants and equipment.

Another interesting idea put forward in the AJA is the “Bridge to Work” program—modeled off a similar program in Georgia that offers unemployment benefits to those who take unpaid positions with companies designed to give them an opportunity to re-enter the workforce and build new skills. The program would provide a boost in productivity to companies that had been forced to down-size, while helping the under- and unemployed to acquire critical skills for newer industries.

Over time I have become increasingly confused as to the meaning of “youth entrepreneurship.” Here in the United States, invariably, the Small Business Administration adheres to the same definition as youth entrepreneurship advocates such as DECA and NFTE who serve high school age Americans and even younger. However, the World Bank and other multinational development organizations appear to be referring to anyone under the age of 40. Further still, private sector global entrepreneurship charities such as the respected Prince’s Youth Business International (YBI)—Prince Charles’s charity—narrow it to between 18 and 25. While the myth of entrepreneurs as “modern day Mozarts” in garages (to borrow Carl Schramm’s phrase) is slowly being dispelled, it seems our human instinct to avoid conversations about age is alive and well!

The reason this matters now is because governments and non-governmental organizations around the globe appear to be ramping up investment in “youth enterprise.”

I've found myself thinking a lot about the research being conducted by the Startup Genome Project these days. The data is an absolute goldmine and provides quantitative benchmarks for issues I've thought about for years. One of the findings from their first report was:

"Most successful founders are driven by impact rather than experience or money." This certainly maps to my experience as a founder and also working with other entrepreneurs. However, in most cases it's a little more complex than that, as I find a number of goals typically intertwine to get people to jump in and start a business.

Auren Hoffman is the CEO of Rapleaf, a personal-data aggregator that has been the subject of a remarkable amount of controversy but is wildly useful as a data provider to must-see apps like Rapportive and Gist.

While Hoffman's company may know a lot about you as a web user and person, he knows a lot of people himself the old-fashioned way, in real life. Introduced before keynoting at Austin, Texas's Capital Factory Demo Day as "the most-connected person in Silicon Valley," Hoffman gave a really interesting talk about how he handles hiring at his company. I live blogged his talk on Google Plus and offer my notes below.

Last week's post on valuation brought a couple questions about EBITDA. The first of which is how do you pronounce that acronym? The answer to that question is e-bit-dah. The second of which is what does it mean? The answer to that is Earnings Before Interest Taxes Depreciation and Amortization.

The way I like to think about EBITDA is the pre-tax cash earning power of the business. It is not much different than the notion of Operating Income which is revenue minus cost of goods sold and operating expenses. But it takes out the two big non-cash items in an income statement, depreciation and amortization.

PHILADELPHIA, September 13, 2011 – Acting U.S. Secretary of Commerce Rebecca Blank, Small Business Administration (SBA) Administrator Karen Mills, Philadelphia Mayor Michael A. Nutter and Gururaj “Desh” Deshpande, Co-Chairman of the National Advisory Council on Innovation and Entrepreneurship (NACIE), celebrated new federal support for innovative entrepreneurs, small businesses, research and commercialization innovation at a meeting of NACIE. Administrator Mills acknowledged two Pennsylvania winners, out of twenty across the country, of the SBA’s new, competitive Intermediary Lending Pilot (ILP) Program. Philadelphia was the only city in the nation with two organizations receiving funds through the ILP.

The award provides $1 million each to Ben Franklin Technology Partners of Southeastern PA and the Philadelphia Industrial Development Corporation (PIDC) to invest in regional startups and to grow small businesses. This funding will provide a new source of financing to drive economic growth and job creation.