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Bank of America Severing Some Small Business Credit Lines: Sign of Things to Come?
Jan 9th
Bank of America recently made headlines about cutting credit lines of some of its small business customers. An article in the Los Angeles Times quoted two small-business owners (and alluded to some others) that had their lines of credit cut off by Bank of America.
Meanwhile, Bank of America officials denied that their action pertaining to small businesses is widespread. Instead, they claim that it impacts “a very, very, very small percentage” of its small business customers, according to bank spokesperson Jefferson George, as quoted in a Huffington Post article. And they still have 3.5 million non-mortgage loans to small businesses on the books.
While Bank of America said it notified the borrowers who were affected by the call on their lines of credit far in advance, some borrowers who were interviewed said they received no such notification. Those Bank of America small-business customers claimed they were caught by surprise, and unable to pay off the loans or find replacements as quickly as Bank of America was demanding.
But I wondered, is this shades of 2009 all over again, where we can expect to hear tales of small business lending woe everywhere we turn? Are we going to see an across-the-board pullback by lending institutions even deeper than we’ve experienced in the past few years? Or is this an issue specific to Bank of America? Let’s take a look at some additional information.
MultiFunding’s Small Business Bank Report Card shows that small business loans held by banks were reduced by $4.84 billion in Q3 of 2011. The loans that Bank of America called in equaled 8.5% of that alone.
While Bank of America had the largest reduction of small business debt in Q3, loans are still available, experts say, but it all depends on where you look for financing.
Says Ami Kassar, founder and CEO of MultiFunding, smaller community banks are still very much viable options for small business owners looking for financing. ”There are plenty of community banks aggressively building their small business loan portfolios across the country,” he notes.
Others also emphasize sources other than big banks for small-business loans. Rohit Arora, CEO of Biz2Credit, reports that his company is not seeing an across-the-board pullback on lending. He notes, ”Biz2Credit is seeing an increased confidence among small business owners and an increased interest among small to mid size banks along with alternative lenders to lend more aggressively to businesses.”
In other words, Bank of America’s action doesn’t mean credit is completely drying up. But credit is still tighter than other times historically. You may have to be more creative than ever in where you look for funding. Look to your local community banks. Look to mid-size regional banks. Examine alternative small-business financing options as pointed out in an article here on Small Business Trends last month. In addition to traditional banks, consider approaching:
- Credit unions
- Community Development Financial Institutions (CDFIs)
- Accounts Receivable (AR) financers
- Microlenders
Money Questions Photo via Shutterstock
Bank of America Severing Some Small Business Credit Lines: Sign of Things to Come?
View full post on Small Business News, Tips, Advice – Small Business Trends
Benefits: They Come From Consumers
Nov 19th
Sometimes the best thing you can do in a cartoon is point out a simple truth. These cartoons are incredibly rewarding to write, and they almost never fail to resonate with readers.
I was pondering that sort of writing one day when I decided it might be fun to have a character in a cartoon point out something seemingly mundane as if it were some new and profound insight.
It takes the presenter a bit to explain that people buying their stuff is good, but thank goodness he and his coworkers are figuring it out.
Benefits: They Come From Consumers
View full post on Small Business News, Tips, Advice – Small Business Trends
Benefits: They Come From Consumers
Nov 19th
Sometimes the best thing you can do in a cartoon is point out a simple truth. These cartoons are incredibly rewarding to write, and they almost never fail to resonate with readers.
I was pondering that sort of writing one day when I decided it might be fun to have a character in a cartoon point out something seemingly mundane as if it were some new and profound insight.
It takes the presenter a bit to explain that people buying their stuff is good, but thank goodness he and his coworkers are figuring it out.
Benefits: They Come From Consumers
View full post on Small Business News, Tips, Advice – Small Business Trends
Women Owned Businesses Have Come a Long Way But It’s Not Far Enough
Oct 12th
How do women-owned businesses differ from companies owned by men? Not as much as they used to, according to a recent study from the SBA’s Office of Advocacy. “Business ownership no longer can be analyzed simply on the basis of the owner’s gender; businesses owned by women and men more and more share the same general development patterns,” write the authors of “Developments in Women-owned Business, 1997-2007.”
Between 1997 and 2007, the report found, women’s share of total U.S. firms increased from 26 percent to almost 29 percent; during the same time frame, men’s share dropped from 55 percent to 51 percent. As of 2007, the top four revenue-generating industries were identical for businesses owned by women, men, and by women and men together; they were construction, manufacturing, wholesale trade, and retail trade.
But there is still one area in which women-owned businesses differ from those owned by men: Women-owned firms were less likely to have employees. In 2007, more than 88 percent were non-employer firms.
Employment is on everyone’s minds right now, and a separate report from the Ewing Marion Kauffman Foundation, “Overcoming the Gender Gap: Women Entrepreneurs as Economic Drivers,” suggests that with the right kind of help, women-owned businesses could become drivers of employment and stimulate the economy.
The Kauffman report found some similar gaps between men- and women-owed companies. For starters, while startup companies, especially high-growth startups, are the biggest source of new U.S. jobs, only about 35 percent of startup business owners are women. In addition, their startups are less likely to grow than those owned by men: Just 36 percent of women-owned startups in the report had employees, compared to 44 percent of those owned by men.
Lesa Mitchell, Kauffman Foundation vice president and author of the report, says that while women are breaking through the glass ceiling, they seem to be encountering “glass walls” that keep their businesses from expanding. As a result, three years after startup, just 19.8 percent of women-owned businesses in the Kauffman report make over $100K annually, while 32.8 percent of men-owned companies do.
Of course, some women (and men) may prefer to keep their companies small. But for those who want to grow, what steps would help them? Mitchell says:
1.) Establishing support networks early in the startup process is one way to position your business for growth. Joining the board of a company in your industry is one way to do this.
2.) She also urges successful women entrepreneurs to become role models and mentors for younger ones.
3.) And she urges more networking and collaboration between startups and bigger, more successful firms.
Networking seems to be a common thread when it comes to helping women-owned businesses thrive. In Forbes’ latest list of the best cities for women in business, the cities that topped the list had several things in common: a supportive legal environment, government procurement goals for women- or minority-owned firms, resources like the SBA’s Women’s Business Centers, and the presence of women’s business organizations to provide networking and support.
Women are often called “naturals” at networking, and most women business owners I know are pretty good at it. But to power your business to the next phase, you need to take networking to the next level. Don’t just network within your comfort zone: Get out of it.
Depending on your business’s needs, that might mean hobnobbing with angel investors or even venture capitalists. It might mean getting comfortable at male-dominated industry events or conferences, or meeting key people at companies that are much bigger than yours. Whatever you’re hoping to achieve with your business, there is someone out there who can help you do it—but not if you don’t get out there and meet them.
Image from Christian Kieffer/Shutterstock
Women Owned Businesses Have Come a Long Way But It’s Not Far Enough
View full post on Small Business News, Tips, Advice – Small Business Trends
Where Will the New Jobs Come From? They’re Already Coming From Remote Workforces
Jul 20th
Who is going to create the new jobs America so desperately needs to get our economy back on track? This question is a subject of ongoing debate. Will small businesses create them? Big business? Well, according to a new survey by online employment platform oDesk, new jobs are already being generated by remote hiring.
oDesk found what it called “a significant shift” in how businesses are hiring and how workers are finding jobs:
“Businesses are growing by leveraging remote contractors to build distributed teams, and contractors, in turn, are earning more money and even starting their own small businesses.”
According to the oDesk Online Work Survey, employers are becoming more comfortable with the idea of remote workforces. More than half (54 percent) of employers have no preference as to where their workers are based. They’re also becoming more confident in relying on contractors or remote staff for critical or core business functions; 55 percent of employers say they give such work to remote contractors.
Ease of communication is one factor making employers feel more comfortable with this arrangement. More than three-fourths (77 percent) of employers communicate with their remote workers several times per week, the majority by email and Skype.
Why are companies turning to remote workforces? oDesk found two primary reasons. More than one-quarter (28 percent) of employers admit to having trouble finding the talent they need in the local workforce. And 21 percent say using an online workforce allows them to scale up or down quickly as needed.
The arrangement is working. Half of employers surveyed said using online hiring to outsource has helped them grow company’s revenues, size or scope of service. In fact, 17 percent of the employers surveyed have grown their businesses by 50 percent in the last year.
One of the most interesting findings of oDesk’s survey is that contractors who seek work through online hiring sources are increasingly seeing themselves not just as employees, but as entrepreneurs. In fact, many are starting their own small businesses and using online employment channels not only to find clients, but to look for other contractors to help them get the work done. In fact, 35 percent of the contractors in the survey say their primary source of work is other contractors.
More than three-fourths (77 percent) of contractors think of the online work as their own businesses. And those businesses are growing: 66 percent of online contractors expect to make more money overall this year than in 2010, and 57 percent say they are charging a higher hourly rate than they did last year.
Where Will the New Jobs Come From? They’re Already Coming From Remote Workforces
View full post on Small Business News, Tips, Advice – Small Business Trends
Where Good Ideas Come From: The Natural History of Innovation
Apr 9th
I love my Amazon.com app for the Android! The day I heard Steven Johnson talking about his book Where Good Ideas Come From on NPR, I was able to pull into the closest parking lot and purchase it before I forgot the name of the book.
As Johnson and the interviewer talked about how Darwin’s theory of evolution ruminated and germinated in his brain, I could feel my brain starting to buzz with curiosity. Where do ideas come from? Are they sparks of brilliance or do they bloom and grow over time? Can we actually generate groundbreaking ideas on demand? I was hooked by the conversation and had to learn more than they were going to share in this interview.
Consume Steven Johnson’s Writing as You Would a Gourmet Meal
I find myself comparing books to food quite often, and this one is like a tasty nine-course meal. There are seven chapters – with an introduction and conclusion to serve as appetizer and desert respectively. I say it’s tasty because Johnson’s writing is both sophisticated and accessible at the same time. I feel like I’m describing a wine here. But in all sincerity, this is a book that truly serves as brain food, and you will consume and savor every word.
Johnson writes like I eat. I work my way around the plate; a bite of steak with a bite of potatoes and then a taste of veggies. This way I have a full experience of the entire meal and all its tastes, temperatures and textures.
That’s what it’s like to read Where Good Ideas Come From. There will be a paragraph about science followed by a paragraph about art followed by a paragraph about how the printing press was actually conceived as an offshoot of a wine press. This way you, as the reader, get the full experience of how ideas don’t just magically appear in full form; they begin in an embryonic state and then are fed by other experiences and thoughts you have. They mature and grow over time–often, unbeknownst to us. For example, Darwin had made unconscious allusions to evolution, but it was clear by his writings that even he wasn’t fully conscious he had hit on something so big and profound until years later.
In short, this is a book about innovation and the space where innovation occurs. Writes Johnson: “Some environments squelch new ideas; some environments seem to breed them effortlessly. The city and the Web have been such engines of innovation because for complicated historical reasons, they are both environments that are powerfully suited for the creation, diffusion and adoption of good ideas.” This is some heavy stuff and you’ll want to give yourself the time to read, think about and process what Johnson is saying on every page.
Interesting Concepts and Thoughts From Where Good Ideas Come From
The 10/10 Rule: The idea that it takes a decade to build a new platform and a decade for it to find a new audience. HDTV is the obvious example. I remember doing HDTV case studies as part of my marketing coursework in the 80s; 20 years later, it’s in my home.
Kleiber’s Law: You’ll learn about Max Kleiber, a Swiss scientist who measured the impact that body size had on metabolic rate. This is why animals with fast metabolic rates eat more and literally live “faster” than those with slow ones. This is why the lifespan of a fly is about 25 days and the lifespan of a turtle can be over 100 years. But that’s not even the cool part. Scientists from the Santa Fe Institute wanted to find out if Kleiber’s law applied to cities. Did cities slow down as they got bigger? The short answer is “not exactly.” There are some variables that increase as a result of being part of a bigger, more complex system – such as elements of creativity. So a city that was 10 times larger wasn’t just 10 times more creative, it was 17 times more creative. And a metropolis that was 50 times bigger was 130 times more innovative.
Tasty Tidbits Make for Educational, Informative and Entertaining Reading
There are hundreds of other examples and stories like the ones I described above nestled in the book’s 250 pages. And the research is so extensive that the Appendix looks to be another 50 pages or so. If you find yourself watching the Discovery Channel or the History Channel as you flip through television channels, this is a book you’d enjoy.
You don’t have to be a historian, a scientist or an academic to enjoy it. Johnson has done all the work for you, and will feed you all the information you need to be the most interesting person at your next dinner or cocktail party!
For More Information
I couldn’t find a website for Where Good Ideas Come From but I did find this really terrific four-minute summary video that you might enjoy. You can also see what Steven Johnson (@stevenjohnson) is tweeting about and follow him on Twitter.
Where Good Ideas Come From: The Natural History of Innovation
View full post on Small Business News, Tips, Advice – Small Business Trends
Why Freeways Come to a Stop
Jan 6th
The Plain Dealer has an enlightening infographic on how traffic jams happen:
View full post on Business Pundit
Where do ideas come from?
Nov 24th
- Ideas don’t come from watching television
- Ideas sometimes come from listening to a lecture
- Ideas often come while reading a book
- Good ideas come from bad ideas, but only if there are enough of them
- Ideas hate conference rooms, particularly conference rooms where there is a history of criticism, personal attacks or boredom
- Ideas occur when dissimilar universes collide
- Ideas often strive to meet expectations. If people expect them to appear, they do
- Ideas fear experts, but they adore beginner’s mind. A little awareness is a good thing
- Ideas come in spurts, until you get frightened. Willie Nelson wrote three of his biggest hits in one week
- Ideas come from trouble
- Ideas come from our ego, and they do their best when they’re generous and selfless
- Ideas come from nature
- Sometimes ideas come from fear (usually in movies) but often they come from confidence
- Useful ideas come from being awake, alert enough to actually notice
- Though sometimes ideas sneak in when we’re asleep and too numb to be afraid
- Ideas come out of the corner of the eye, or in the shower, when we’re not trying
- Mediocre ideas enjoy copying what happens to be working right this minute
- Bigger ideas leapfrog the mediocre ones
- Ideas don’t need a passport, and often cross borders (of all kinds) with impunity
- An idea must come from somewhere, because if it merely stays where it is and doesn’t join us here, it’s hidden. And hidden ideas don’t ship, have no influence, no intersection with the market. They die, alone.
View full post on Seth’s Blog
Rumor: Sony PlayStation Phone to Come Out This Winter
Oct 27th
Speculation has it that Sony will release the new PlayStation Phone, an Android-powered device that represents the next evolution of its top-selling PlayStation Portable (PSP) series. Here’s a leaked image of the phone. Engadget writes that the PlayStation Phone will…
likely (boast) Android 3.0 (aka Gingerbread), along with a custom Sony Marketplace which will allow you to purchase and download games designed for the new platform. The device snapped up top (and in our gallery below) is sporting a 1GHz Qualcomm MSM8655 (a chip similar to the one found in the G2, but 200MHz faster), 512MB of RAM, 1GB of ROM, and the screen is in the range of 3.7 to 4.1 inches…the handset does indeed have a long touchpad in the center which is apparently multitouch, and…it’s still bearing those familiar PlayStation shoulder buttons.
You can also plug in a memory stick.
The PlayStation Phone will let users download apps and games from the Sony Marketplace. This could be a big financial boon for Sony, especially if the PlayStation Phone gains the kind of traction that the PSP series has. I don’t see any reason that it won’t. Even if Sony makes the PlayStation Phone expensive, it has a solid enough fan base that the product will probably sell well.
The PSP Go already came with Skype, so the PlayStation Phone would simply up the ante on an already popular, capable device. The pervasive gaming potential of this device could be a huge selling point. Imagine meeting a rival or partner in, say, an airport waiting area, and teaming up to play Resident Evil 5 with another PlayStation Phone owner? Or playing one of the Grand Theft Auto series while sitting on a bus?
This is all, of course, assuming that the PlayStation Phone is more than a mere rumor. The Washington Post’s Rob Pegoraro says don’t get your panties in a twist about this phone yet:
Unless Sony has an exceptional software emulator or compatibility layer up its sleeve, this hybrid won’t run existing titles without a rewrite. Its earlier attempts at smartphones, while technically impressive at times, have gone nowhere in the market. So have earlier attempts at building gaming-first phones, such as Nokia’s epically failed N-Gage.
He points out, correctly, that Apple’s white iPhone has been delayed until next spring, and could simply be code for Verizon iPhone. But building all this hype certainly isn’t hurting Apple or Sony (or, if yesterday’s rumors rang true, Apple-Sony).
View full post on Business Pundit
Come on, Small Businesses, Get ‘App-y!
Oct 12th
Whether on the browser or on mobile devices, app-mania has taken over. Consumers are looking for the next great app that will make their lives easier–and smart, nimble small businesses are happy to comply. In fact, from sales gurus to sports communities, small businesses are quickly realizing the power that apps give them to increase awareness of their business, help them reach a new audience, improve customer engagement and even drive revenue.
Whether a business chooses to develop apps for the Web, a mobile app platform, or both depends on their specific business goals, user base and budget. For Reby Sky, owner of the fan site NYGiantsGirl.com, a browser app was the best choice for her online fan base. Sky is a self-proclaimed “Super Fan” of the New York Giants and is also an on-air host for SportsRev.TV and Sirius/XM Radio. During the off-season, Sky found it challenging to maintain fan attention for her shows and website.
Seeking an inexpensive and easy way to connect with fans online at any time of year, she developed a Web app that offers fans the ability to quickly access the New York Giants website, view Sky on Facebook and YouTube, and shop for women’s football apparel and accessories. To date, there have been more than 800 installs of her Web apps. Through the NY Giants Girl Community Toolbar App and NY Giants Girls App, Sky is now able to retain fan attention during the off-season and keep them clamoring for more.
Feed Their APP-etite
Small businesses can also extend their reach and attract new audiences through exposure in one of the growing app stores or marketplaces. App marketplaces provide unprecedented exposure to a wide audience.
Marketplaces such as the Google Apps Marketplace, Conduit App Marketplace and others promote apps to a pre-qualified audience of interested consumers. By adding an app to a marketplace (which is free to do), SMBs expose their content, product and services to a new and vast audience of potential users. In addition, app distributors and marketplaces are developing more advanced monetization opportunities to allow publishers to earn profits with their apps.
Consider the example of Topix. An aggregator of localized news, Topix was seeking a way to provide more personalized service to its users and encourage them to spend more time participating in its online community. Topix developed a Web app that delivers localized news content right in users’ browsers, making the news more relevant and accessible and encouraging user interaction.
The Topix App became wildly popular when Topix decided to distribute it in the Conduit App Marketplace, which gave them exposure to more than 250,000 Web publishers and 170 million users. This exposure helped Topix attract nearly 4.5 million app users in less than one year.
App Savvy
In the end, the big question is whether apps can help drive sales. When thought of as a marketing tool, the sales model is easier to understand. Apps provide an introduction to a business, product or service. They provide value to the user and help the business forge a strong connection with that user. In turn, when the user is ready to make a purchase, they’re more likely to buy from that business.
Take the experience of Sam Richter of WarmCallCenter.com, author of the top-selling book Take the Cold Out of Cold Calling. Richter created several apps that provide his customers with important content such as links to tools, Web sites and his tips. The Web apps help keep his content top of mind and, in his own words, are “a core component of my business.” Since launching his app toolbar in 2008, Richter reports that his revenue has increased by 337 percent.
From creating consistent exposure for NYGiantsGirl.com, reaching a wider audience via an app marketplace like Topix, or driving real sales and revenues like WarmCallCenter.com, each of these small businesses was able to achieve specific goals through apps. SMBs seeking new, cost-effective and beneficial methods for expanding their businesses should consider these examples and think about how their business can “get ‘app-y.”
Come on, Small Businesses, Get ‘App-y!
View full post on Small Business News, Tips, Advice – Small Business Trends
