Fresh Inc.: The Staff Blog

The Truth about Cyber Monday; Tour the Gawker Offices

2009-11-06T12:02:51-05:00

Tour a Start-up's Office: The Gawker edition. Gawker Media, the parent company behind blogs like Valleywag and io9, has been experiencing a growth spurt of 40 percent year-over-year. Now Silicon Alley Insider takes us inside CEO Nick Denton's "steampunk" headquarters in downtown New York as part of its new tour a startup photo feature. What should you expect from inside the belly of the blogging beast?: A couch straight out of the Matrix, a roof deck for courting advertisers, the requisite glass-walled conference room, and a "comfortingly familiar" library-like atmosphere to soothe recent college grads. The myth of Cyber Monday. Online advertising company Permuto offers up an interesting infographic on the history of Cyber Monday, the Monday following Thanksgiving which is the online equivalent of Black Friday. Also known as every e-retailers' favorite day. The term, which has now become part of our cultural lexicon, was reportedly first mentioned in a press release from Shop.org on November 21, 2005. Contrary to popular belief, Cyber Monday is not the biggest online shopping or spending day of the year. In fact, that day typically occurs sometime between December 5 and 15th. However, Permuto theorizes that the ever-growing hype over Cyber Monday may lead to a self-fulfilling prophesy in which this year's day may actually become the biggest online shopping day of the holiday season. (Hat tip to Digg.) E-commerce health is either thriving or diving. About those e-retailers: two reports released this week are painting vastly different pictures of the online retail landscape, with one estimating that e-commerce saw a 2 percent drop in Q3 and the other charting expected 8 percent growth in November and December compared to last year. So who to believe? There's no easy answer according to the Wall Street Journal. comScore and Forrester Research, who respectively churned out the conflicting numbers use dramatically different approaches to evaluate online shopping. comScore measures the behavior of a large body of volunteers while Forrester surveys consumers and retailers as well as pooling data on things like Google ads to flesh out the picture. Forrester analyst Sucharita Mulpuru pointed to Amazon, which is predicting Q4 growth between 21 and 35 percent, to bolster the group's findings. "The entire rest of the industry would have to be really negative" to lead to a down quarter, she said. Boston vs. Seattle vs. Boulder: how does the climate for tech startups measure up? peHUB points to a thoughtful post from Seattle business blog Xconomy which has the highlights from a VC panel comparing startup culture in different cities. Boulder has the nation's highest per capita of computer scientists and PhDs--not to mention a wealth of executive leadership imported in during the dotcom boom--but around 2003 the "endless cocktail party circuit" got stale, says the Foundry Group's Brad Feld. He launched Tech Stars, a seed fund and mentorship program, to make first-time entrepreneurs the new core of the ecosystem--partnering them with experienced founders and energizing the community in the process. Chris Sheehan from CommonAngels said Boston has a deep bench of entrepreneurs, and the wealth created from startups is being reinvested via VCs. But "the dispersed ecosystem" makes things difficult, which is why clusters are forming in the city around mobile, gaming, Web, e-commerce, tech, and marketing. In Seattle it looks like the next wave of angels and entrepreneurs will likely come out of Amazon, but Steve Hall of Vulcan Capital was frank about the city's perceived shortcomings. "People outside Seattle, particularly fund investors, believe that Seattle is a little too nice. We enjoy our lifestyle too much. Boulder may have a little of this as well. That doesn't build the most competitive companies when you've got people in the Valley who live and breathe this for sport." Calling all NYC entrepreneurs. The New York Public Library's Science, Industry, and Business wing has announced their first annual New York StartUP! Business Plan Competition for any aspiring Big Apple entrepreneurs. The winner will receive $15,000 to help start their business, while other cash awards totaling $28,000 are also available to runners-up. In addition to the money, entrants will also receive orientations and business mentoring. Full details and due dates can be found here. Chairs that Tweet. The hip furniture maker Blu Dot picked a novel marketing campaign to celebrate the first anniversary of its New York City store. The company placed 25 blue chairs, which retail for $129 each, in New York City and let people grab the free samples. The catch? Each chair has a cell phone with a GPS chip attached to the bottom. When someone picks one up and takes it home, the chair sends a Twitter message with its location. The second catch? If you grab a chair, you get followed by a video crew and interviewed for a promotional video. But you get to keep the chair! Fast Company has some nice pictures of the campaign and asks, justifiably, "But is it marketing?" We're not sure either, but the promotion is working well as a PR stunt. Unemployment hits 26 year high. The unemployment rate hit 10 percent last month, for the first time since 1983. The Wall Street Journal has the historic (and depressing) news, but notes that it could be worse. Only 190,000 jobs were lost last month, compared to 741,000 jobs lost in January. Welcome to your jobless recovery. Employers who are hiring consider their options. Despite those abysmal unemployment numbers, some small companies are actually switching to hiring mode. But should that new employee be hired full-time, temporarily, or as a contracted position? The AP reports that despite the onerous responsibilities that come with hiring someone on staff--from federal and state labor laws, workers compensation insurance, and employment taxes like Social Security and medicare--hiring full-time employees is the often best way to build the business for the long-term. Said Arlene Vernon, president of the Eden Prairie, Minnesota-based HR consulting firm, HRx Inc., "If you know you're growing, then find someone who's really committed. They're going to think for the benefit of the organization." More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

Biz Lessons from the Poker Table; Google's New Idea

2009-11-05T11:19:28-05:00

Yanks win, but few spoils for Bronx businesses. Congratulations to the New York Yankees, for winning (yet another) World Series championship. But while the team celebrates, owners of the struggling small businesses whose shops flank the new $1.5 billion House that Steinbrenner Built, are feeling more like the defeated Phillies. As the New York Times reported earlier this week, despite the Bronx Bombers' winning season, sales at local businesses were down significantly from previous years. New traffic patterns around the stadium are one reason for the drop, but some vendors blame the team's owners for opening up more concession stands outside the stadium. "I think what they're trying to do is force everybody else out," said one business owner. "It's dismal, very dismal." Google's new e-commerce offering. Google's ever-expanding product line just got even bigger thanks to its new Commerce Search, a search function tailored for retailers. The service, which incorporates Google's search capabilities into your online store, carries a price tag of $50,000 a year according to TechCrunch, but Google says it's worth it. Their claim is that faster search speed will help customers navigate to what they want quickly, making them more likely to buy. Other perks include the ability to customize the search function to match the rest of your site and integration of other Google products like Google Analytics. Entrepreneurship lessons from the poker table. In business, as in poker, sometimes you have to know when to fold 'em. So says serial entrepreneur and blogger Eric Ries on GigaOM. Ries takes the lessons he's learned from watching the World Series of Poker and explains how entrepreneurs and poker players share many of the same qualities. Namely, "Both rely on acting strategically under conditions of extreme uncertainty. And, in both, small changes in your odds of winning can have a big impact on the final outcome." Ries goes on to point out that just as in poker where amateur players sometimes beat the pros, many successful businesses are run by generally poor entrepreneurs. A frustrating truth in both cards and business. As Ries says, "Just because someone has had a success doesn't necessarily mean they understand why they were successful at all." For a look at an entrepreneur who helped launch the professional poker phenomenon, check out this profile of the World Poker Tour's Steve Lipscomb from the Inc. archives. The Droid arrives. Verizon has been courting app entrepreneurs with those creepy commercials for its new smart phone. The Motorola Droid comes out this week--and the Wall Street Journal's Walt Mossberg has a review. Long story short: The phone is pretty good. "It's the best super-smart phone Verizon offers, the best Motorola phone I've tested and the best hardware so far to run Android," he writes. But will the Droid, named for Google's Android operating system, be able to replace (or join) Apple's iPhone as the preeminent platform for app entrepreneurs? That seems unlikely in the short term. Mossberg notes that the iPhone marketplace currently dwarfs the Android's offering, and he finds a number of problems with the new phone, namely a cramped keyboard and some software bugs. Skype founders settle, finally. Janus Friis and Niklas Zennstrom's four year old sale of Skype to eBay just got a little sweeter. The pair, who unloaded the online phone company for roughly $3 billion in 2005, will get 10 percent of a newly independent Skype, two board seats, and an option to buy more stock. Kara Swisher has the news and says that the deal marks an end to legal wrangling that stemmed from a dispute over software licenses and over eBay's decision to sell Skype to an investment consortium that included the former CEO of another of Zennstrom and Friis's companies. Swisher says that the lawsuit was especially fierce, "using embarrassing emails and making pointed accusations of...plotting all kinds of nefarious schemes." The power of women-owned businesses. Last month, the Center for Women's Business Research released a study which found that 28 percent, or an estimated 8 million, of all U.S. businesses were women-owned. The study also showed that those 8 million cross-industry businesses created or maintained 16 percent of the country's jobs. However, only 4.2 percent of the nation's revenue is generated by women-owned businesses. The Center plans to approach the Obama administration, the Small Business Administration, and House and Senate small-business committees to request more resources and programs in support of the women business owners, reports the New York Times. On how the sector of support for women business owners needs to expand, executive director of the national Women's Business Council, Margaret Barton said, "Women really have to fall in love with running a business. They have to move into the state about being excited and motivated by running a business. We need help with that area." Finding the right business partner. Tech entrepreneur Neil Patel shares some advice on his blog, QuickSprout, about the benefits of having a business partner, and how to find the right one. Patel, who admits he's been through his share of partnerships, warns that the union can be as tumultuous as a marriage and recommends setting expectations for each partner on day one. To that end, he suggests "sealing the deal" by putting both names on the LLC -- with clearly delineated percentages -- to prevent issues with money or ownership. More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

The "Other" Entrepreneurship; Inside Intuit

2009-11-04T11:50:19-05:00

Private companies still cutting back. A new employment report from ADP estimates that private companies cut another 203,000 jobs in October, Bloomberg reports. The good news? That's down from a decline of 227,000 in September. The bad? "I’m still expecting to see payroll employment decline probably through the end of the year," Joel Prakken, chairman of Macroeconomic Advisers, told Bloomberg, "not turn up until January or February." Google's definition of disruption: the "less than free" business model. Benchmark Capital's Bill Gurley considers himself an aficionado of business disruption. Think game-changing movements like software-as-a-service, open source software, and the freemium internet model. "As a venture capitalist it is imperative to understand ways in which a smaller private company can gain the upper hand on a large incumbent." But Gurley says Google topped all other disruptive plays of all when it announced this week that it was including free turn-by-turn navigation directions with each Android mobile OS. To understand how disruptive this is to the GPS data market, says Gurley, you need to know how "turn-by-turn" data became the lynchpin that held the duopoly of NavTeq and Tele Atlas together. In a market where maps are free, turn-by-turn data, which was costly to build and maintain, became a differentiator. On the heels of Google's announcement, stocks at companies like Garmin and TomTom fell upwards of 16 percent. For Google, argues Gurley, "less than free" doesn't stop with the iPhone. If Google goes the same route with its Chrome operating system and Sony or HP or Dell build a netbook with Chrome as its base, Google would gladly pay the ad splits to the computer manufacturers to put even more pressure on Microsoft's Windows. To build or buy a business. The popular conception of entrepreneurship involves building a business from scratch in your garage, but buying an existing venture can be a less glamorous but savvier entree into the business world. On the New York Times You're the Boss blog, Barbara Taylor outlines some of the perks of buying rather than building, including less risk and more cash flow. Also, check out Inc.'s new section on buying a small business as well as a piece on a machine shop in Indiana that's on the broker's block. Minting a new Intuit. After Intuit closed its deal to acquire personal finance site Mint.com earlier this week, TechCrunch caught up with Mint founder and CEO Aaron Patzer to discuss the details of the acquisition. Along with the $170 million for the start-up, he also receives a new title: vice president and general manager of Intuit's Personal Finance Group. His first official mandate as boss? Putting the kibosh on Quicken Online, which, according to the post, has significantly fewer active users than Mint.com. "Over the next six to nine months," he says, "we will end-of-life Quicken Online and their customer's data will be migrated over to Mint." The move will prove to be a particularly ironic one, considering that the Quicken Online team, which Patzer now oversees, was dubious of Mint's success prior to the acquisition. Patzer says later directives will include Mint and TurboTax integration, and helping users with financial planning for "big life goals" such as paying debt or buying a house. Click here for an Inc. Q&A with Patzer, in which he explains why he finally decided to sell. Tough economy sends even laundromats into a spin. Coin-operated laundromats have long been touted as recession-proof businesses. After all, no matter how tough times get, people will always need clean clothes. Still, today's Wall Street Journal reports that this difficult economy is even affecting laundromats, putting a strain on their reputation for always turning a profit. "Now more than ever, the adage that we're recession-proof is being tested," says the president of the Coin Laundry Association. The Journal speculates that the economy has led people to wash their clothes at the home machines of friends and family and that people are wearing clothes longer between washes. Laundromats may collect their revenue one quarter at a time, but their effect on the economy is no small change; coin laundries represents a $5 billion industry with roughly 35,000 stores nationwide. Foursquare's Eurotrip. The location-based social networking application Foursquare, started by the founders of the similar but too-early-for-its-own-good Dodgeball, has been building serious momentum since it picked up $1.35 million in seed funding in September. First, it announced an advertising platform for small businesses to offer rewards to its members. At the time, Mashable said Foursquare beat Twitter to the "local advertising goldmine." Then it added 15 cities in the U.S. and Canada. And today, TechCrunch reports that it's also rolling out its service in 15 European cities. Earlier this month, founder Dennis Crowley told us the service only had 100,000 registered users, but it looks like it won't stay that small for long. Social, computer-based games are dominating the video game sector. The holiday season is typically the biggest money-making time for the gaming industry, but recent price cuts for Sony's PlayStation 3, Microsoft's XBox, and Nintendo's Wii have failed to generate much of an increase in profit. However, one company that has been capitalizing on the $50 billion industry is the two-year-old London-based start-up, Playfish. Unlike traditional console-based video games, Playfish makes social, computer-based video games, which can be played through social media sites, like Facebook and Myspace. With tens of millions of people playing social games, and buying virtual goods, such as presents, clothes, and furnishings, so far, some believe that the social gaming industry is just in its infancy. Playfish chief executive, Kristian Segerstrale told Reuters, "The video-gaming market is in the middle of this fundamental tectonic-plate shift, away from being a physical product-driven industry to being a digital service-driven industry."

Tweets in Your Pocket and the Danger of Multitasking

2009-11-03T11:46:42-05:00

Get ready for Twitter, the gadget. One of the reasons for Twitter's breakneck growth has been the company's decision to make its data available to anyone interested in building applications on top of its messaging system. (This approach has worked pretty well for two other companies you may have heard of.) Until now, all of the Twitter upstarts--such as the iPhone app Tweetie and the link-shortener Bit.ly--have focused on making software. But now, one company is trying to turn Twitter into a profitable gadget. Peek, a New York start-up that makes a cell-phone like device for email, just introduced a $199 hand-held gadget "built exclusively for sending tweets," according to the Wall Street Journal's venture capital blog. According to the article, Peek "expects the TwitterPeek to be popular among those who use Twitter to promote their business, likely equipping an employee with a dedicated device." (Via Techmeme.) Hiring data shows a glimmer of hope. Good news! As reported in the Houston Chronicle, a recent survey of small- and medium-sized businesses showed that 28 percent are planning to add new positions. That number is up significantly from six months ago when only 18 percent said they were planning on making new hires. The survey, which was done by HR outsourcing firm Administaff, also revealed that 23 percent of companies are planning to increase their employee compensation. Are multitaskers more productive?. Web Worker Daily says no, citing a recent study. Stanford researcher Clifford Nass started looking into the subject because he envied his students' ability to multitask and wanted to know how they did it. So Nass and his colleagues studied a group of 100 "high multitaskers" (who used four or five types of media at the same time, like texting while reading email while chatting on the phone) and "low multitaskers" (who used a piddling two at a time). The results showed that the high multitaskers did worse on all three aspects that define success: the ability to focus on the relevant and ignore the rest; the ability to organize information; and being able to move between tasks. Of course, it's possible that high multitaskers are just naturally bad at those kind of things. It's also possible checking your Blackberry while you browse the internet while you're on the phone with the client isn't actually improving your productivity. Inc.com's own Josh Spiro talked to Pandora founder Tim Westergren about this topic back in September. Read Westergren's tips for staying productive. An academic start-up incubator. It's not always clear how to take the great ideas hatched in universities and turn them into companies. But, as TechCrunch reports, the University of Southern California's Stevens Institute for Innovation is doing its part. The college is set to announce tomorrow that the Stevens Institute has helped raise $115 million in funding for 15 USC spin-offs in the past two years, connecting entrepreneurs with foreign investors, grants, and local VCs. How to pick your angels. Hacker News flags a post by Chris Dixon on mistakes start-ups make when choosing their angel investors. He cautions against picking angels who are suggested by your lead investors and against picking investors simply because they are well-known. Instead, Dixon recommends picking "a varied group of people." He writes, "If you want a few celebrities to create some buzz, fine. You should also pick some people who are connectors – who can introduce you to key people when you need it (varying connectors by geography and industry can also be helpful). Also very important are active entrepreneurs who can (and will) give you practical advice about hiring, product development, financing etc." For help finding angels, check out our angel investor directory. Are entrepreneurs the new celebrities? Maybe not, says the Wall Street Journal, but things seem to be moving in that direction--at least when it comes to product endorsements. The article cites several companies, including Dell, American Express and Intel, that have recently used entrepreneurs in ad campaigns. After AT&T spotlighted Blake Mycoskie, the founder of the Venice, Calif.-based Toms Shoes, in a 30-second commercial during the Masters Golf Tournament, the spot became so popular online that the phone company produced a 60-second version that premiered on American Idol. Mycoskie also notes that his daily online traffic tripled. "There can be no doubt that AT&T is responsible for this increased exposure," he says. The Journal goes on to highlight the cost-effectiveness of using entrepreneurs, who will often do the campaigns for free, versus A-list celebrities, who can come with a million dollar price tag. Build-a-Bear cleaning up. It's hard to believe that an industry that specializes in making cute and cuddly teddy bears, and other fuzzy friends, is worth $1.5 billion in the U.S. alone. It is, and the St. Louis, Missouri-based retailer Build-a-Bear Workshop is dominating that market, reports CNN Money. Founder Maxine Clark started the business in 1997 in her local mall, and has since expanded the enterprise to 400 locations nationwide. Build-a-Bear's 2008 revenues hit $468 million. Says Clark, "When customers create toys at Build-A-Bear Workshop, they make something that is theirs alone...At Build-a-Bear it's all right to act like a kid. That's appealing to people who are 10 or 60." Time to diversify? When the economy is bad and revenues drop, diversification seems like a reasonable strategy. But in a Harvard Business blog post, Monica Tate-Maile discusses how hard it can be. Meanwhile, check out the Case Study in Inc.'s November issue about how a troubled company found new opportunities in lean times. More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

Confessions of a Facebook Spammer; Starting Your Own Category

2009-11-02T12:38:46-05:00

How Facebook spam works. Facebook just won a $711 million lawsuit against an email marketer who had operated a spam scam on the social network. But scams are still endemic on the social network, according to a guest post on TechCrunch. "The underlying premise of all the advertising techniques we've discussed so far is that trickery is profitable," writes Dennis Yu, CEO of BlitzLocal. "Fool them into thinking the new friend request is from Facebook, lie to them that the miracle skin creme is actually free, tell them they'll earn points if they just click this button-which then puts their email address on a list that's resold to the top spammers in the world." The post is a great read if you're interested in the dark side of online advertising, and it contains an interesting prediction about Facebook." I honestly believe from my meetings at Facebook, that they've all drunk the Zucker-koolaid and are putting the user experience ahead of earnings," Yu writes. "That's why, if you're a UK resident, you're not seeing those sexy Russian dating ads from a couple months ago-but man, were those profitable." Starting your own (profitable) category. "If you can't be the first in a category, set up a new category you can be the first in." So say the authors of The 22 Immutable Laws of Marketing. Entrepreneurs like Gary Vaynerchuk and Tim Ferriss are certainly evidence that you can build a brand the around a unique personality or passion. But where do you start? Web Worker Daily outlines five steps to building your own category, including abandoning the idea of appealing to everyone, being laser-focused and building the framework to support your individual voice. Federal agencies try the cash-for-innovation model. In the past, businesses have often taken the lead in advertising high-profile competitions that were accompanied by sizable cash prizes in order to spark inventors' interest in developing new technologies. These days, however, it has become the norm for federal agencies to also use contests to inspire innovative inventors by offering financial rewards. As reported by the Boston Globe, the Department of Defense has used these types of contests to hasten the design of military robots that soldiers can carry during combat, and NASA has also awarded more than $2 million since 2006 through its Centennial Challenges program to innovators who have designed space-faring robots. According to Andy Petro, manager of the NASA prize program, "We're not paying for ideas; we're only making awards when an idea has been translated into practical reality." Small business lender files for bankruptcy. The will it, won't it, drama surrounding commercial lender CIT Group came to an end yesterday when the 101-year-old lender said it was entering a "prepackaged" reorganization plan through bankruptcy court, The New York Times reports. The company said it expects to emerge from the proceedings before year's end. CIT is one of the nation's biggest players in the "factoring" industry, whereby "suppliers and manufacturers sell payments owed for goods and services to companies such as CIT because they need immediate cash," Bloomberg explains. With an estimated 70 percent of the factoring market, CIT is a huge lender to the retail industry, including thousands of small and mid-sized businesses. "Short term, it's going to cause some difficulties for startups and smaller borrowers," Jean Everett, a partner at Hiscock & Barclay LLP, told Bloomberg. The big losers on the deal? Likely the taxpayers, who are expected to lose most, if not all, of their $2.3 billion bailout investment in CIT. The balancing act with virtual goodsAs we've noted before, virtual goods are flourishing, but it can be a tight rope act for companies to get revenue from players of their virtual games without scaring them off. Companies need to employ both economists who help find the perfect price for the goods, and creative types who ensure that the virtual games and social networks stay engaging and competitive. Virtual goods are estimated to be and $1 billion business in the U.S. according to the San Francisco Chronicle but usually only 5 to 10 percent of users help the companies pull in money. Plus, there's always the danger that a newer, cooler game will drag players away. But despite the risks, the industry is expected to remain lucrative. Charles Hudson, founder of the Virtual Goods Summit which was held last week in San Francisco says, "People are going to keep spending money on virtual goods because they're spending time in these places, building relationships and engaging content. It's just like another hobby." Amazon and Zappos make it official. And the price is $1.2 billion. The acquisition was announced several months ago, but the deal has received government approval, and it closed over the weekend. (In the interim, the total size of the deal went up by $300 million, thanks to a jump in Amazon's stock price.) CEO Tony Hsieh writes, "I'm excited because Amazon supports us in continuing to grow our vision as an independent entity, under the Zappos brand and with our unique culture." (For more on how Zappos grew itself into a billion dollar company, check out our May cover story.) More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

Remembering a Fast-Food Icon; The Rise of NYC Start-ups

2009-10-30T11:20:23-05:00

Fred Wilson on "slow capital".The VC and blogger Fred Wilson tackles the slow movement today, and introduces a new term: slow capital. The slow movement encourages people to focus less on accomplishing tasks and more on taking one's time with things. Wilson's take includes focusing on meeting the company's needs rather than the investors' and being flexible with timing. "I've spent almost twenty five years in the capital markets watching investors behave," he writes. "Way too often it is a 'wham bam' experience and then off to the next deal. Things like exploding offers, 'fly by' board members, and shotgun marriages are so common that you sometimes wonder how anyone makes any money. There's a reason why Warren Buffet is the best investor of his generation." How to come up with a company name. Don't stress. That's the advice of Thomas Petersen who says that a great product will more than compensate for a bad name. So focus on that. "There are no perfect names only great products," he writes. Still, coming up with a name--especially at a time when many short dot-coms are taken--is hard. Petersen advises picking a name that says something about your product. And keep in mind that bad names can start sounding pretty good if your company does a good job. "Your brand cannot make your product better, only you can make your name better," he writes. "By making sure that your customers and users get good experiences when they interact with you, your name will gain value. Therefore concentrate on your customer service, optimizing the service, providing superior experiences and maximum utility and your name is well on its way to be the perfect name you wanted it to be." Remembering a fast-food legend. Sad news for fast-food aficionados as Troy Smith, founder of the drive-in burger chain Sonic, passed away this week at the age of 87. As the Wall Street Journal reports, Smith's burger joints were originally named Top Hat, but after he introduced a system where drive-in patrons could deliver their orders via speakers, the name Sonic was chosen and gave birth to the company's slogan, "Service with the speed of sound." An innovator in the restaurant field, Smith's original fast-food chains in the 1950's included waitresses on roller skates, a streamlined kitchen, and angled parking spots so that the "wild teenagers," as he described them, couldn't park window-to-window. Smith became Sonic's "chairman emeritus" in 1983, but remained involved with the business as an advisor. In 2008, Sonic had $3.8 billion in sales and 3,600 stores in 42 states. The SBA ups the size limit for small businesses. If this first round of proposed revisions is adopted, more than 12,000 additional companies would be considered small businesses, and hence become eligible for SBA loans and preference for federal contracting, reports the Washington Business Journal. A total of 71 different types of businesses would enjoy SBA-sanctioned benefits should the changes be approved, including hotels, retailers, and various sectors within the service industry. According to SBA Administrator Karen Mills, the size increase is designed to "reflect changes in the economy and the marketplace." Facebook and Zappos on hiring strategies It seems like there's always some new company started by former Google employees, but is that good press for the company or brain drain? As the Wall Street Journal reports, Facebook's Mark Zuckerberg and Zappos' Tony Hsieh recently discussed their opposing philosophies of employee hiring and retention at Y Combinator's Startup School. Zuckerberg favors a revolving door of bright people honing their craft at Facebook and then going on to their own creative endeavors. Hsieh said he aims to keep employees for the long haul and explained how he achieved that goal. "We now provide mentorship and training so employees can join at the entry level and, over a period of five to seven years, have the opportunity and training to become senior leaders in the company," he said. "Constant growth is what will keep them in the company for a very long time." Get some additional hiring tips from Whole Foods' John Mackey. Do you know where your children are? Well, if they're at Keith Valley Middle School, be afraid, says TechCrunch. Very afraid. That's because Microsoft has gotten a hold of them, and the result is a cult-like video starring the Bing jingle. (Director's note: What isn't shown is the aftermath in which the Bing students get stuffed in lockers by their Google counterparts.) Vibrant tech startups emerge from New York's financial wreckage. According to Wired, New York City's tech scene has got an unexpected boost from the financial sector's demise. Investors that used to look to larger institutions are giving startups that need just a couple hundred thousand more of a chance. Scrappy tech CEOs are also having an easier time pulling good talent. With the financial and media industries in turmoil, the market in general is more hospitable to these upstarts. Engineers that were once hard to lure away from six-figure salaries are attending suddenly maxed-out events like NY Tech Meetup. And VCs like Spark Capital, Polaris in Boston, and First Round in Philly are creating a network effect. In fact, New York has been quietly, asserting itself as a hub for tech startups for the past couple years. First Round Capital's entrepreneur-in-residence Charlie O'Donnell tells Wired, "Some of the entrepreneurs who have been 'head down,' building great businesses, are now able to take a breath for the first time in years . . . so there's more visible participation from them in the community." So who are some of these phoenixes rising from the ashes? Ivy Exec: "like an even more velvet-roped version of Ladders.com" that Inc. profiled in July. And GiveReal: a site that started out as a Facebook group and lets people give gifts at nearly a million different merchants by piggybacking on existing credit card networks. (Hat tip, peHUB). More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

How to Find Small-Business Grants

2009-10-29T11:58:37-05:00

Bye bye recession. The nightmare is over. Maybe. The Wall Street Journal (along with everybody else) is reporting that GDP grew by 3.5 percent in the third quarter, "likely marking an end to the worst recession since World War II." That's great news, but it was driven partly by large amounts of government spending, especially the Cash for Clunkers program. That's all over now. "Since the federal stimulus reached its maximum effect in the third quarter and the unemployment rate remains high, there's uncertainty over the sustainability of the recovery," The Journal reports. Business Insider says that we may be looking at a jobless recovery, which is better than no recovery, but still pretty bad. The billionaires next door. Silicon Valley is hardly unaccustomed to concentrated wealth. But according to Valleywag, in one Palo Alto neighborhood not too far from Stanford, YouTube co-founder Jawed Karim lives next door (literally) to Facebook co-founder Mark Zuckerberg, who for months has also been occupying a property a short walk away that serves as his social network's new headquarters. It's a modest, laid-back locale for Karim, whose estimated wealth is $64 million and Zuckerberg, who's worth $2 billion on paper. So why did a College Terrace tipster rat out the rich kids? In the midst of its fast growth, Facebook failed to provide sufficient parking and employees are taking up all the spots. Finding grants for your small business. Information on where you can find, and how you can apply for, grants is publicly available and free. If your small business meets all of the necessary qualifications, you may just be able to receiving federal funding, writes CNN Money. Federal grant funding programs, such as the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs, award more than $2 billion each year to qualified small businesses. While technology-based companies have historically won the majority of these grants, it's possible - if not a bit tougher - to receive funding as a non-tech business. Find out if your business qualifies for any special small business certifications, and investigate local government websites for an economic development agency you can get in touch with. Or, you can try Grants.gov to find and apply for federal grants. The perfect Halloween costume for tech geeks. Courtesy of the Baltimore Sun's tech blog, check out this video of perhaps the coolest, if not the nerdiest, Halloween costumes this season. The video shows two guys decked out as life-size iPhones. Not cardboard and tin-foil iPhones, mind you. Actual working iPhones. The two devised life-sized, wearable monitors that displayed the functions of their standard iPhones right on their chests. Pretty amazing. The costumes may not land them dates on Halloween night, but it has surely won them the admiration of tech geeks everywhere. Securing your company's data. It's a little shocking that, in 2009, any company would secure its data with a single, not-so-secret, password: "password." But considering that The Wall Street Journal found one for its piece on data protection, we're figuring there are a few more of you out there. So may we recommend that you read The Journal's article and then check out some more password protection tools right here. Borrowing the app from Apple. For now, the growing app industry is all about smart phones. But Ford is opening a development kit for in-car apps, according to our siblings over at Fast Company. The developers envision drivers using the apps to plan trips, find points of interest, and access other data on-the-go. "The way we're developing the toolkit, you could sit in the comfort of your home and plan a roadtrip," says Prasad Venkatesh, who leads Vehicle Design & Infotainment at Ford. "At the click of a button, the cloud would make all that available to you in the car, and it would broadcast it to your social networking groups." More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

A Halloween Entrepreneur and More Credit Woes

2009-10-28T12:01:26-05:00

From grease monkey to professional pumpkin carver. Just in time for Halloween, the Wall Street Journal has the story of Sean Fitzpatrick, a former auto mechanic who turned his hobby of carving pumpkins into a successful business. Fitzpatrick's transition from a job as an auto mechanic at a Ford dealership to a professional artist began rather simply when his three-year-old daughter asked him to build her a snowman. His artfully-carved creation led to some media attention and inspired him to start building sand castles as well. As Ford began to close dealerships, Fitzpatrick used that as the inspiration to quit his job and get into the sculpting business full time. It's been uphill ever since. Fitzpatrick's business now does sand sculptures, ice sculptures, and pumpkin carvings for corporate promotion events. On Halloween day, look for Fitzpatrick doing a live pumpkin carving for a NASCAR event at the Talladega Speedway. Community banks object to lending plan. At the American Bankers Association's annual meeting, which is currently being held in Chicago, some attendees are complaining about the government's proposed programs for small banks, reports Reuters. Many of the new efforts to aid small businesses that were unveiled last week by the Obama administration rely largely on community banks to ease the credit crunch. One such program would provide low-cost capital to banks that submit a plan about how the capital will help them provide increased lending to small companies. However, many bankers are hesitant to take the money because of potential restrictions on executive compensation. Uncertainty a potential threat to recovery. Smart business owners always have a plan b, but in the face of so much political uncertainty, it sometimes feels like there aren't enough letters in the alphabet for all the contingencies. According to the Wall Street Journal, business owners are having trouble planning for the future because of health care and climate change legislation, both of which are being debated in Congress now, as well as the uncertainty around the Bush-era tax cuts. The Journal quotes a Standard & Poor's analyst who says, "It's all anecdotal, and it affects everybody differently, but the one common factor is people postpone decisions. And I'm afraid that's going to slow us down coming out of the recession." Lonely days in the Valley. It may not be a great time to be looking for a job in Silicon Valley. But if you're a business owner looking for new digs, there's a whole lot of office space to choose from, reports Silcon Alley Insider. With vacancy rates above 20 percent, it pays to shop around and to negotiate for a low rate. 24-year-old brings the Threadless model to college sports. It's clear even from a quick look at Jeremy Parker's resume that he's got the entrepreneurial bug. When he was 19, he used the $7,000 he saved from his bar mitzvah to make a film called "One Per Cent" about the wealthiest demographic in America. Fresh out of Boston University, he started TeesandTats, which sold limited edition pieces by a famous tattoo artist. And today, Parker is launching his latest venture, Vote for Art, a partnership with MV Sport that brings the Threadless model to the sleepy world of sports paraphernalia. MV Sports helps Parker secure the licenses from various sports teams. Designers send in their interpretations of what the team's t-shirt should look like for a chance at $500 and 2 percent of the sales of the winning design. The first contest is for the Purdue University Boilermakers just in time for the team's first nationally televised game of the season December 1. Virtual goods booming. It sounds weird at a time when companies can barely move physical stuff, but the market for virtual goods--like digital poker chips on Facebook--is booming, according to TechCrunch, which reports on a survey by digital goods marketplace PlaySpan. "[T]he fact that a third of digital goods buyers reported that they also sold goods is promising for the virtual goods marketplace space," writes Leena Rao. PlaySpan claims to have processed $50 million worth of transactions since it was founded in 2006. Twitter for treadmills? A common gripe from those who dread working out? Boredom. But according to NewTeeVee, San Franciso-based startup Netpulse thinks that the usual iPod and magazine combo isn't enough any more. The company announced last night that it has raised $3.1 million in venture capital, led by Javelin Venture Partners, to turn treadmills, bikes and elliptical machines into interactive entertainment centers -- complete with social media networking. The 15-inch touchscreen terminal, which is to be deployed by the end of the year, can be purchased by gyms for about $800, and is attached to the workout equipment, enabling users to enjoy on-demand music and video and read RSS feeds. Integration with sites like Twitter and Facebook will come next year, the post says. You'll be able to "auto-Twitter your 5k splits and challenge your friends to beat you." Or you can just stay away from the gym and Twitter about that using your cell phone. More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

Family Business Feuds; The Ideal Career Path

2009-10-27T12:14:14-05:00

Should VCs and angels get a small business bailout too? As Obama moves into the small business phase of the stimulus plan, there's been more talk about financial support for early stage venture capitalists and angels. "All I can say to this is 'vomit,'" Foundry Group managing director Jason Mendelson writes on peHUB. In his open letter to the current administration, he argues in favor of policies that supports small businesses like startup visas and patent reform. Just not necessarily handouts for the people who back them. "I find it offensive that high net worth angel investors or highly compensated venture capitalists along with their sophisticated investors need to be bailed out. We, as an industry, should be responsible for our investments and frankly, the current recession hasn't affected our early-stage industry very much." Mendelson is just as frank with the startups angling for government support. The risk is there for young companies, with or without the recession. Only now there are benefits, he argues, like lower rents and the ease of hiring good people. Venture capital's first seeds. Love 'em or hate 'em, we all know the significant role venture capitalists play in the entrepreneurship ecosystem. But where did they come from? Here's a little history lesson, courtesy of serial entrepreneur Steve Blank. The ideal career path for an entrepreneur. For an entrepreneur, joining a startup, either as the founder or an early employee, is more like the first step on a career path rather than just another gig, argues Hunch founder and Skype investor Chris Dixon. "If your goal is to start a company, it is mostly a waste of time to work anywhere but a startup-with the possible exception of a short stint in venture capital." Some of Dixon's commenters disagreed. Shan Sinha said his experience working at Microsoft before founding DocVerse was extremely valuable, giving him insight into decision-makers at large companies and how a startup can position itself against larger competitors. VentureHacks' Babak Nivi commented that since most startups are poorly run, a better option might be join a startup that's really taking off (hi, Twitter), or just follow a good leadership team, early-stage venture or not. What do you think is the best path to prepare for launching your own company? Cautionary tales for family business owners. Nothing beats a family business when things are running smooth, but when troubles arise, both the business and the family run the risk of self-destructing. The Boston Globe has a fun slideshow that details some of the most famous family feuds over business and their ugly aftermath. For example, the bitter infighting between Curtis and Prestley Blake, co-founders of the Friendly's restaurant chain, was anything but. Likewise, the brothers Berkowitz, heirs to the Legal Sea Food restaurants, had to have a court settle their disputes over control of the family business. Funny Legal's CEO Roger Berkowitz never mentioned that last year when told us all about the way he works. How to decide if your business idea is any good. Tired of being asked by people about whether their business ideas were good or not, tech entrepreneur and blogger Neil Patel lays out his thoughts on the best way to figure it out. "I am sorry to be the bearer of bad news, but the chances are, neither I nor anyone else is going to know whether your business idea is going to work or not," he writes on Quick Sprout. The only way to know, says Patel, is to actually start the business. He goes on to share some tips about getting a business going and how to gauge its success; he also delivers some tough love, "If you are really passionate about your idea, you need to go with your gut and start it. Now, this doesn't mean you'll necessarily succeed, but you'll never know if you don't try it out." Google Voice now allows you to keep your original number. Mobile voicemail services that create text-based messages for you to read instead of listen to are nothing new, but Google Voice is making the transition easier. Initially users had to choose a new phone number to sign up for Voice, but as of yesterday, they now have the choice to keep their digits and still receive most of the same functionality. According to PC World even with your old phone number, Google Voice will allow you to search through your voicemail online, create custom voicemail greetings for different callers, receive text and email notifications about new voicemail, receive free transcriptions of voicemail, and enjoy low-priced international calling. Eleven fatal business mistakes. Businesses can just as readily end with a whimper as with a bang. Jay Goltz, who owns five small businesses in Chicago, chronicles eleven common and uncommon errors businesses make. They range from the head-smackingly obvious like not guarding against embezzlement, to missing more minute details like using the kind of extension cords that could start a fire and not preventing vehicle liabilities by checking company car tires regularly enough. More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

Paul Graham: The Truth About Startups

2009-10-26T16:33:48-05:00

I was lucky to attend Y Combinator's annual Startup School this weekend. The event began Friday night with a party at the business school cum venture capital fund's headquarters in Mountain View, California, and continued Saturday morning with a talk by Y Combinator co-founder Paul Graham on the UC Berkeley campus. Graham, whose ideas about low cost startups have launched something of a revolution in early stage finance (read about that here), gave a talk entitled "What Startups Are Really Like," that drew largely on the experiences of the hundred odd companies that Y Combinator has helped launch. It's a long, 19-part essay that's worth a read for anybody who is getting started (or thinking about it), but perhaps the most interesting part comes at the end, when Graham tries to make sense of why so many founders find the process emotionally difficult. The bottom line: Running a company is totally different from having a job, which makes it hard--and also interesting. Money quote: Everyone's model of work is a job. It's completely pervasive. Even if you've never had a job, your parents probably did, along with practically every other adult you've met. Unconsciously, everyone expects a startup to be like a job, and that explains most of the surprises. It explains why people are surprised how carefully you have to choose cofounders and how hard you have to work to maintain your relationship. You don't have to do that with coworkers. It explains why the ups and downs are surprisingly extreme. In a job there is much more damping. But it also explains why the good times are surprisingly good: most people can't imagine such freedom. More here. I'll be blogging more about the what I learned at Startup School over the next couple of days.

Yahoo Pulls the Plug on GeoCities; Android on the Rise

2009-10-26T11:10:28-05:00

How to throw away $4 billion in 10 short years. When Yahoo purchased the pioneering online communities site GeoCities in 1999, the latter had yet to turn a profit. Over the decade in which it lived under the Yahoo umbrella, it's not clear that it ever did. So today, Yahoo is pulling the plug on GeoCities, marking the official death of a site that was once the third-most-visited on the web. Why Hulu's pay model may save the Internet. For years, the web has been a freeloader's paradise, says Chadwick Matlin in The Big Money. In Free: The Future of Radical Price, Chris Anderson argued that that cost-free meant maximum audience, followed (ideally) by maximum ad revenue. But as ad revenues fall, it's clear the Internet can no longer support that model, says Matlin. Startups are monetizing earlier, content sites are reinventing their business models by sticking ads in cracks and crevices, and news sites are toying with the idea of pay walls. So the fact that Hulu may start charging for content both legitimizes the site's business model and provides a test-case for other Internet companies moving away from the ad-supported revenue. "It's time we grow up and understand we're going to have to pay for things we really love once they become successful," says Matlin. "We're getting too old to expect to crash on our friends' couches without paying rent." How to turn developing countries into consumers. For the past ten years, some of the world's largest companies have tried to convert the four billion people living in poverty around the world--the so-called Base of the Pyramid--into consumers. But it's always failed, argues Erik Simanis in the Wall Street Journal, because companies have been approaching it as though they were selling to a consumer market, when in fact, none existed. "They haven't been conditioned to think that the products being offered are something one would even buy," says Simanis,a reseacher at Cornell's Johnson School of Management, drawing a parallel between American resistance to the idea of bottled water back in the 1970s. "For many poor consumers, paying for clean water or sanitation products seems just as outlandish." What's the best way to create a market? Work directly with local communities to develop products and businesses and "give consumers a stake in adopting the goods." Rather than engaging in the uphill battle of widespread messaging involved in an educational campaign once the product or service has already been developed, seek involvement from the start, says Simanis, who, along with his colleagues, has developed a Base of the Pyramid Protocol that's proven successful in a test with Solae, a soy protein, in India. WaterHealth International, do-good capitalist of the year in 2007, took a similar approach with its water filtration device in Ghana, going as far as building a local network of professionals to service and maintain the equipment and helping communities find financing for the water centers to keep new consumers invested. More app developers eyeing the Android. With 2 billion iPhone apps downloaded, Apple has enjoyed a lengthy reign as the king of smartphones -- at least when it comes to the everyday consumer. But according to a post at GigaOm, the number of projects started by app developers for Google's Android has shot up a whopping 94 percent between September and October, which might indicate a growing shift toward the underdog's mobile platform. The Android's rising popularity among creators could partly be attributed to Apple's stall on jumping on the augmented reality bandwagon -- but still, developers for iPhone apps have made millions through the App Store. We'll have to wait and see if developers have the same success with the Android OS. Ivy League degree not required. Entrepreneur turned academic Vivek Wadhwa writes an interesting guest post on TechCrunch regarding his research into what makes for a successful entrepreneur. Turns out, a fancy Ivy League degree isn't a necessary precursor for entrepreneurial success. In three separate studies, Wadhwa sampled large cross-sections of entrepreneurs to determine where they had received their schooling. His research showed that in each case, a large majority of successful business owners received their college degree from non-elite schools. Another interesting aspect of Wadhwa's research shows that entrepreneurs who did not attend college were less successful than their college-educated peers. As Wadhwa explains, "What makes entrepreneurs successful is the education, not the school." Entrepreneur opens his office to the public. Speaking of colleges, 37signals CEO Jason Fried has taken a page out of a university professor's handbook and begun holding "CEO Office Hours" where he makes himself available via telephone for anyone who cares to speak with him. As the Chicago Tribune reports, Fried has set aside the hours between 3 and 5 p.m. Central time Tuesdays and Thursdays to take calls from the general public. Fried reports that a lot of the early calls have been from would-be entrepreneurs looking for business advice. Want to chat with Fried? Check out the article, it even lists his phone number. Hiring data shows a glimmer of good news. According to a new economic survey published by the National Association for Business Economics, unemployment is moderating. As reported by the Associated Press, although the jobless rate is currently at 9.8 percent, and estimated to rise above 10 percent by early in 2010, companies in general appear more willing to hire employees. The survey also showed that while tight credit is continuing to hurt business, the credit squeeze is also hurting less businesses nationwide (42 percent) than reported back in July (54 percent). More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

How to Decide to Close Up Shop

2009-10-23T12:21:24-05:00

Building business credit. Sure, the Obama administration just announced plans to boost credit to small businesses, but getting financed can be a chore without a solid credit history. The Wall Street Journal offers advice on the best ways to build business credit, which include organizing and updating your financial records to present to banks and credit issuers, and doing business exclusively with vendors and suppliers who can report positive payment history to commercial agencies, such as Dun & Bradstreet and Experian. For example, Yves Darbouze, a chief executive at New York-based Plot Multimedia, was able to secure a $100,000 equipment loan because of a Dun & Bradstreet rating of 87 out of 100, which he built by securing credit cards and loans from local companies and gas stations, the article reports. Business's top movers and shakers. The Huffington Post wants your input on the business world's "Ultimate Game Changer." Choose from 10 hotshots, including Tony Hsieh of Zappos, Amazon's Jeff Bezos, and the founders of Zipcar. Cast your votes here. When to shut down your company and what are your alternatives. The online private equity forum peHUB links to a post from Ask the VC on the agonizing decision over when to close up shop. It's only the right time to pull the plug if you have no other options. But there are alternatives: additional financing, a sale or merger, bankruptcy, or crash and burn. A sale might be the best option, says wind down columnist Roger Glovsky, because the sale price is often undisclosed. “The big company may get strategic assets (often technology or intellectual property) at a discount and the small company preserves its reputation. Win-win. The public may not ever know that the business failed.” In the mid 90s, Glovsky ran a software development company that sold Mac software to other businesses at a time when major corporations were phasing Macs out of the office. They were competing against other vendors and free software from Apple itself. On the advice of their board, they tried to develop new products and follow new opportunities, but eventually wound down the business and distributed the leftover assets to stockholders. "Whatever you do," says Glovsky, "don't wait too long to start the process; it gets messy." If you're still wondering whether it's time to throw in the towel, check out this classic post from serial entrepreneur Jason Calacanis. Social media advice from the experts. This past week marked the annual BlogWorld Expo, an industry conference and trade show dedicated to all things blogging and social media. American Express OPEN Forum took the opportunity to buttonhole some of the conference's presenters and ask them for their advice for small- and medium-sized businesses looking to make the most of their social media efforts. Three industry experts weighed in and offered their thoughts on such topics as turning online chatter into real-world sales and ways small businesses can improve their search results. Women-owned small businesses not confident about 'green' funding. In 2008, only 3.4 percent of the $514 billion spent on federal contracts went to women-owned companies. Although the stimulus package contained $80 billion earmarked for green energy and investments run by women-owned businesses, that allotment does not seem likely to come to fruition based on the percentage of funds received by women-led companies in years past, according to reports by MSNBC. At present, the green business industry is one dominated by men, and many believe a bias exists against women-owned businesses. "Discrimination is real, but I also think women need to be educated and trained on how to sign up," says Margaret Barton, executive director of the National Women's Business Council, as reported by Eve Tahmincioglu of MSNBC. Choosing to disconnect. We'll leave you this week with a story for all you business owners who fantasize about what life would be like if you weren't attached to your cellphone. Enjoy. More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

The Upside of a Housing Crisis and Google Goes Tweeting

2009-10-22T17:42:53-05:00

From bust to boom. In the wake of the ongoing foreclosure crisis, South Florida has emerged as one of the regions hardest hit. But some local businesses are making the most of the meltdown. As the Miami Herald reports, a wide array have taken advantage of the opportunities that have developed from the recent spate of foreclosures. Giving Tree Development of Fort Lauderdale buys bank notes at discounted rates and then lowers borrowers' monthly mortgage rates to help them save their homes. Other businesses aren't quite as philanthropic. Peter Zalewski started CondoVultures, a real-estate business that specializes in selling foreclosed properties to cash investors looking for bargains. As he explains it, "It's not noble, but it's definitely profitable." Zalewski's unapologetic approach to his business has even landed him a spot in Michael Moore's new documentary, "Capitalism: A Love Story." In one interview featured in the film, Zalewski points his finger like a gun and declares, "This is straight up capitalism. Chi-chi-boom." Twitter gets cozy with Google, Microsoft. And the geeks go wild. Yesterday in separate, dueling announcements, Microsoft and Google said that they would integrate Twitter postings into their search results. Here's Google's Marissa Mayer. And here's Bing's announcement. Techcrunch sums it up thus: "Search is about to get realtime. Real Fast." Obama Announces Small Business Relief. We told you yesterday that the mythical Small Business Bailout would be announced soon, and it finally was, reports New York Times (link and coinage via Huffington Post's esteemed business editors). President Obama, in an obvious snub to Inc. columnist Norm Brodsky, unveiled his plan at a Maryland records storage company. The plan allows small community banks to borrow from the Treasury Department's TARP program, which initially only applied to big banks, and it raises the maximum size of SBA loans. The SBA rule change requires congressional approval, but there's a bill in the House that would do just that. We're waiting with baited breath for a reaction from Anonymous Banker. Why the "winner takes all" theory doesn't always work. Sure there are dominant companies synonymous with their industries: eBay for auctions, Google for search, Facebook for social networks. But Bijan Sabet says it doesn't always work that way. "Winner takes all" believers also tend to advocate that the best way to beat that incumbent is to build a better mousetrap. Sabet recommends the opposite: competing by "doing less (not more) and focusing on one thing and doing it very well." By way of example, he points to the business of online employment ads, where Monster.com once ruled. Now, by implementing different business models focused on different experiences, you have Craigslist, LinkedIn, The Ladders, and Indeed. "Entrepreneurs are just too creative, too ambitious and too optimistic to allow for a winner takes all world," he writes. (Hat tip, peHUB.) Read Inc.'s story on Friendster to find out what happens when a winner-takes-all flames out. Wringing dollars out of social media. In light of a recent Citibank survey that indicates most small business still haven't joined the social media movement, Mashable has highlighted five companies that have -- and successfully. One of the start-ups that made the list, The Marsh Cafe in San Francisco, offers free drinks to "mayors" of the location-based mobile social media app, Foursquare. Click here for more tips on building your business with social media. Thinking outside the box. As cloud computing becomes more commonplace, we will likely see more moves like the integration Box.net is undertaking with Salesforce.com. The companies are offering unlimited storage on Box.net to businesses that use the new Salesforce integration, according to TechCrunch. CEO Aaron Levie says the move is the first of a series that will try to position the company as a hub for all its users' cloud-based data. Read them and weep. If you're still seething about the effects Wall Street's collapse has had on your business, the books in this list right here could give you some closure, or put you over the edge. (Via Huffington Post.) More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

How Not to Get Duped by Invisible Display Ads

2009-10-21T11:53:56-05:00

When an employer strikes. If you've ever thought of spying on an employee you suspect might be working with a competitor, the story of Kathy Lawlor may make you think again. The Chicago Tribune has the cautionary tale of a Chicago company's multi-million-dollar mistake. Twitter CEO Still Not Focused on Revenue. During an on-stage interview at the Web 2.0 conference yesterday Evan Williams was grilled about possible revenue sources for his fast-growing startup, Twitter. But he generally demurred, reports Business Insider's Dan Frommer who posts his notes from the interview. Williams told the crowd that the company was spending the vast majority of its time and money working on Twitter as a product, with the hope that revenue will eventually come. He said that right now Twitter makes some money from cell phone carriers and marketers. Wired's Stephen Levy, in an article that appears this month, pegs the number at $4 million or so. Levy also helps explain why Williams is ignoring revenue growth in the short term: "[T]he company expects to have 25 million active users by the end of 2009 and 100 million by the end of 2010. In 2013, it hopes to become the first Internet service to sign up 1 billion users." Obama announces increased credit for small businesses. Obama plans to announce a proposal today that will encourage more lending to small businesses - an undertaking that the administration has been touting since May. Without constraints on borrowing, the thinking goes, small businesses will be empowered to drive employment growth and help turn around the economy. The package of initiatives will include increasing the cap on SBA loans, and allow smaller banks to have more access to Troubled Asset Relief Program (TARP) funds, reports Reuters. Everything you need to know about invisible display ads. Advertisers have been in a tizzy since the Wall Street Journal piece's last week on how brands like Kraft, Greyhound, and Capital One were duped into thinking that their display ads were showing up on websites like MyToursInfo.com, when, in fact, no visitors could see them. Relying on the fact that these brands don't always audit their campaigns, and the fact that display ads are purchased based on the number of times they are loaded onto a page rather than click-throughs, scammers have been adding the ads on pages called iframes that pop-up when you click on site, but coding them as invisible. In one case, clicking one corrupt site opened 46 invisible iframes. That way multiple advertisers pay for their display ads being loaded, even though the consumer can't see them. If you're curious how to tell a real display ad from an invisible one--or how to avoid paying for ads consumers can't see, check out MediaPost's primer on what they are, how they work, and how to protect your company. Facebook gets a Hollywood upgrade. West Wing creator Aaron Sorkin (we'll always think of the him as the guy behind Sports Night) has confirmed much of the cast of the upcoming Facebook movie and Gawker has the details. Nebbishy Jesse Eisenberg, currently seen battling the undead in Zombieland, will play Mark Zuckerberg. Justin Timberlake will play Napster co-founder and Facebook advisor Sean Parker. Melanie Griffith's daughter has a confirmed part, possibly as a Victoria's Secret model Zuckerberg allegedly escorted away from a San Francisco party one time, at least according to Ben Mezrich's book, The Accidental Billionaires. Says Gawker, "If only Silicon Valley were this good looking." The real history of Monopoly. Hasbro, which makes the perennial bestselling board game Monopoly, claims the game was invented by an impoverished salesman named Charles Darrow during the Great Depression. But the Wall Street Journal reports on an 83 year old economist and inventor who says otherwise. Ralp Anspach was disappointed with the message of Monopoly and in the 1970s devised an alternative version, Anti-Monopoly, "in which players compete to break up existing monopolies rather than create them," the Journal writes. Hasbro sued and Anspach, who, while defending himself, began researching the history of the game. He claims that Monopoly was really invented by Elizabeth Magie in 1904 and called "the Landlord's Game." Hasbro and Anspach eventually settled the case--agreeing to disagree about the history. Anti-Monopoly is now sold under license. Raising $12 million on the slyTracked.com may have been flying under the radar for the past year and a half, raising $12 million without generating much buzz, but now the more important question is not whether they're on your radar, but whether your company is on their radar. TechCrunch billed the new service as "LinkedIn meets Yahoo Finance, on lots of steroids." The site, which launched today, allows users to view everything from public financial data to company overviews and counts Fred Wilson as an investor and an adherent. Check out our recent article on another site that answers all your SMB questions. One business's battle over taxes and a pink flamingo. Interesting story in today's Baltimore Sun over how the neighborhood of Hampden is divided over one small business owner's decision to take down a giant pink flamingo that adorned her restaurant for years rather than pay a tax on the big bird. Denise Whiting, owner of Cafe Hon, has hung the over-sized flamingo from a fire escape above her cafe for over seven years, over which time it has become somewhat of a neighborhood landmark. But when a city inspector said Cafe Hon must get a "minor privilege permit" for the sculpture, similar to an outdoor dining permit, Whiting chose instead to disassemble the pink landmark. The move has ruffled some feathers and stirred a debate amongst other area businesses. One side blames the city and sympathizes with Whiting. "The city of Baltimore makes it hard to be a small business owner in so many ways," said one business owner. Others were less sympathetic. Said the owner of a local wine store, "Were it me, I'd pay the fine and move on. You pay your taxes and you run your business." More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.

‘Tis the Season for Retail; Is Being King Overrated?

2009-10-20T11:30:07-05:00

The top 25 most active VCs. Venture capital investments bounced up 17.5 percent last quarter. Which VC firms were responsible for the uptick? TechCrunch used the data it collects from CrunchBase, a wiki of tech companies, investors and industry insiders, to rank the most active firms both in the third quarter and year-to-date. Draper Fisher Jurvetson tops both lists with 34 deals so far this year. The interactive tables can be sorted according to the total value or the mean value of the funding rounds. In that case, firms like Redpoint and Accel, which have sizable funds investing in later-stage deals, shoot to the top and firms like DFJ and First Round, which specialize in seed funding and early-stage rounds, dropped to the bottom. Read more about whether your business plan will attract VCs or check out our venture guide to all things venture capital. Training wheels for would-be retailers. For anyone who's ever toyed with the idea of launching a retail store but wasn't quite sure if their idea would be a success, today's Los Angeles Times reports on the rise of kiosk rentals as a more flexible and less expensive alternative to traditional store leases. Thanks to their low cost of entry and rental agreements that can be as short as one or two months, kiosks are now a $12 billion industry in the U.S. according to one source. As one kiosk retailer who sells her own handmade jewelry explains, "I would love to own a little store, but I figured this would be a great start, just to see if it works." Small though they may be, the right kiosk can deliver some impressive returns. Probably the most famous example of kiosk success is Crocs, those loudly-colored plastic shoes got their start as kiosk items. Chamber of Commerce Gets Pranked. The U.S. Chamber of Commerce has been making lots of news and spending lots of money in an attempt to derail President Obama's agenda, especially his efforts introduce a cap and trade system to deal with climate change. The stepped-up lobbying activity cost the Chamber $35 million last quarter and it caused a number of companies that agree with the White House, including Apple and PG&E, to withdraw from the group. Meanwhile, Nike recently resigned its seat on the Chamber's board. If that wasn't enough dissent, NPR reports that a left-wing group held a fake press conference yesterday, during which a fake spokesperson seemed to reverse the Chamber's climate change stance. The "news" was dutifully reported by CNBC and Reuters, and then reversed when a real Chamber rep interrupted the press conference. Slim pickings in store for holiday shoppers this year. Less variety, fewer brand names, and uncharacteristically moderate holiday discounts will be the norm this year, as retailers stock their shelves conservatively for the months ahead. As reported by the Boston Globe, luxury retailer Saks Fifth Avenue has slashed its inventory by nearly 20-percent, compared with last year's stock, JCPenny has cut 14-percent of its stock, and even discount giant Wal-Mart has decreased inventory by about 6-percent. While the holiday season is historically the busiest shopping period of the year, this year, retailers will be more apt to let items run low, or out of stock, in order to avoid being left with millions of dollars in unwanted, end-of-season merchandise. To be rich or to be king. That, says Jason Cohen of Smart Bear, is always the question. The concept, which was conceived by Harvard professor Noam Wasserman, refers to the fact that some founders are in it for the money (to be rich) and some are in it to run a great company (to be king). Cohen explained in a blog post yesterday why he decided to sell his company and go for the former. "There are those [who] want to be "King" no matter what," he writes. But he says that while he loved being king, he also wanted to make sure that his company would create some wealth. So he opted for a lower-risk strategy and sold out. "I have the freedom to work on any project I want for the rest of my life while simultaneously providing for my family, never again worrying about bills, debt, having a place to sleep, or sending our daughter to any college she wants," he concludes. Sounds pretty good to us. Holiday retailers take old-school approach. With the holiday season fast approaching and many consumers still struggling to secure credit, some retailers are bringing back a long-forgotten program: layaway. But, as the Chicago Tribune reports, the reversal could be short-lived once access to personal credit becomes easier. More from Inc. Magazine: Get this delivered to your inbox. Follow us on Twitter. Friend us on Facebook.