Risky Business
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Of Guitar Hero, TARP, and the Credit Crunch
Continue reading… 0 CommentsI was reading Inc's fascinating article about Harmonix, the developer of the first two Guitar Hero games and the current smash Rock Band games. It's a terriffic read--Harmonix went from being a company that hadn't made a dime in almost a decade, to being one of the most successful video-game developers ever.
But one portion I think is quite revealing in terms of just what we have to lose from this current economic crisis. This excerpt describes what Charles Huang, founder of Red Octane, the former partner of Harmonix and designer of the little plastic guitars that launched a million fingers, had do to keep Guitar Hero alive:
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The Best iPhone Apps for Entrepreneurs
Continue reading… 1 CommentSarah Scrafford at WebPreneur Blog has a handy list of the 20 most useful iPhone apps for entrepreneurs. Most of these would be useful for anybody dealing with a busy work life. Let me highlight the apps that would be most useful for entrepreneurs specifically:
iBillTo: Financial transactions take place whether you’re in the office or not, so it’s important that you have a way to enter them from anywhere you happen to be. Using iBillTo, you’ll be able to keep track of client billing information, so it’s all available to you whenever and wherever you need it.
Attendance Countdown: Don’t let your working hours get away from you. Use this app to count exactly how many hours you’ve spent working, and count down how many you have left available.
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Despite Recession, Maybe Now Is Not The Time for Layoffs
Continue reading… 0 CommentsAlmost everyone is expecting the unemployment rate to only increase. Small businesses are certainly going to be hit by those job losses. The most recent NFIB survey said that in the month of October, small business employment fell by eight percent, and it went down ten percent the month before that. Laying off employees is an obvious way to save money during a recession.
But could it actually be costlier in the long-run to lay off an employee?
This New York Time article from yesterday gives some reasons to think so:
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What Businesses Get Hit Hardest In a Recession?
Continue reading… 0 CommentsWhen US News published my list of five Most Overrated Small Businesses, I knew I was getting into controversial territory. Restaurant associations are not pleased with the number of people who call the restaurant industry a bad area of business for the small-business owner.
They have some good points. Claims about the failure rate for restaurants are often grossly overstated. It's not around ninety percent, but around two-thirds for restaurants in their first few years. Still high, but not much higher than for your average small business.
But it's still a difficult business, as almost anyone involved in it will tell you. And in today's economy, it's only getting more difficult.
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Despite Credit Crunch, Small Business Lending Still Alive and Kicking
Continue reading… 1 CommentThe SEC is holding some interesting panel discussions regarding small businesses and capital, and securities regulation and smaller public companies, going on live right now. Webcast is available here.
On this morning's panel I heard one of the best descriptions of the credit crunch as it applies to small businesses. Andrew Sherman, a partner at Dickstein Shapiro LLP in DC, said regarding small business access to capital that "the patient is sick, the patient is ugly, but the patient is not dead."
Despite all the turmoil in the recent weeks, and the failure of the bailout plan (so far) to stop the bleeding, the initial assessment that I wrote about back in early October seems to hold true: lending standards have certainly tightened, but money is out there if you know where to look.
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Credit Card Users Keep Getting Squeezed, Rates and Fees Rising
Continue reading… 22 CommentsWhenever credit card use becomes more difficult for consumers, small-business owners are one of the most deeply affected of that group. Credit card debt is a huge source of small-business financing (some would say too big of a source).
But it is indeed getting more difficult. The Wall Street Journal reports today that even though the Fed is lowering its benchmark rate--which should be increasing lending activity--credit-card issuers are tightening in a number of ways: raising interest rates, hiking punitive fees, and lowering limits.
The exact responses differ. But it all points to one message: if you've had a large outstanding balance on your card for some time, the party's over. For example, Chase is now charging a $10 monthly fee for some customers with outstanding balances of over two years.
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The Detroit Bailout: Automaker CEOs Talking Out of Both Sides of Their Mouths
Continue reading… 13 CommentsI was perusing the testimonies that the CEOs of Ford, GM and Chrysler gave before the Senate Banking Committee yesterday, and I can't help but be slightly amused. The nature of this proposed bailout has put the heads of the Big Three in an uncomfortable situation.
On one hand, they must show that money given to them is an actual investment, and not just a drop down a bottomless well. That means they need to argue that they have reformed themselves into mean moneymaking machines with one foot ahead of the competition, ready to face the changing trends of the industry.
On the other hand, they need to show that they need the money, and that the federal government needs to give it to them right now. That means they need to argue that they are in complete dire straits, on the verge of collapse, and ready to take everyone down with them.
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Things Every Small Business Person Should Know About Google
Continue reading… 0 CommentsGoogle has so many apps these days it can be hard to keep them straight. Even if you use its search engine or maps feature as much as I do, there may be other tools you don't know about. Kudzu has a good rundown of the best apps and how they matter for small businesses. Example:
If you’re not already running a Google AdWords campaign for your business, it’s definitely worth a try, particularly if the bulk of your business is conducted online. You can open a Google AdWords account for free then start an online ad campaign for as little as a $25 investment. With such a low startup cost, Google AdWords gives small businesses the ability to not just advertise online but to test keywords, spending, and more to find the right mix before investing a more significant amount.
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Immigration--A Source for Entrepreneurial Innovation
Continue reading… 45 CommentsImmigrants in the U.S. are much more likely to be entrepreneurs than native-born Americans. So it makes perfect sense when Sharon McLoone of the Washington Post reports the following:
Traditionally in the United States, most of the owners of start-ups and small businesses have been men ages 18 to 34. But new data compiled in 2006 and 2007 show that today's entrepreneur is an urban, middle-income, middle-aged immigrant.
The entire Global Entrepreneurship Monitor report, by researchers from Babson and Baruch colleges, has plenty more interesting findings. For example, it helps debunk the myth that poor immigrants do not contribute much to economic growth and only serve as "cheap labor." In fact, a not-insubstantial number become entrepreneurs. For example, according to the report, about a quarter of early-stage businesses started by Mexican-Americans are started by people of lower household income (under $40,000).
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Youth Interest in Entrepreneurship Declines Amid Recession
Continue reading… 0 CommentsA new poll released today (but not posted online) :
In its seventh annual “Teens and Entrepreneurship” poll, Junior Achievement has found that 13-18 year olds are less interested in starting their own businesses than they were a year ago. In 2007, 67 percent of teens indicated an interest in entrepreneurship; in 2008 that number declined to 60 percent—perhaps as a result of the stagnating economy. Teens cited “unemployment,” “possibility of recession,” and “the federal budget deficit” as the top three threats to the U.S. economy. But in a show of optimism, more than half (53 percent) predicted they would be better off financially than their parents.
There has been talk about the Facebook/Myspace generation being destined to be the most entrepreneurial yet, and I've expressed skepticism about that theory.
I don't think this poll is reason to be more skeptical and conclude anything dramatic about deteriorating entrepreneurship, though.
