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Peer-to-Peer Job Sites Inspire Micro-Entrepreneurs

12 Feb

By Darren Dahl

Thu Feb 9, 2012 2:32pm EST

(Reuters) – Chris Mok, like many Americans over the past few years, lost his job in the wake of the Great Recession.

While Wok, 46, diligently sent out resumes trying to replace his Macy’s marketing job he lost in 2009, he also kicked in to help his wife, Isha, run Hi’iaka, her Hawaiian-themed florist shop in San Francisco.

It was early last summer, when many florist businesses see a bump in business from graduations, that Wok first heard about a site called Task Rabbit, where people can post jobs of any just about any kind – such as helping with a move, painting a room or even running an errand – or bid to work on a job posted by someone else via computer or on the go with a GPS-enabled smartphone. Mok suggested that his wife try the site out as a way to hire on a few extra hands for the busy season.

His wife’s experience with Task Rabbit went so well that Wok, who hadn’t worked outside of his wife’s business in about nine months, came to a realization: why couldn’t he earn some extra money bidding on jobs himself?

“I hit the ground running and have been working almost seven days a week since July,” says Mok, who now makes about $3,500 a month tackling everything from handyman repairs to hanging whiteboards and assembling Ikea furniture for the burgeoning number of startup companies in his area.

“It feels great to be your own boss and to pick and choose the jobs you take on.”

Unless you have been living under a rock, you know that the hot button political issue these days is the nation’s unemployment rate. In January, the U.S. jobless rate was 8.3 percent, on its way down from last summer’s rate of 9.1 percent.

That’s why the rise of online marketplaces, so-called peer-to-peer job sites like Task Rabbit are so exciting. They promise to generate new employment opportunities, or let just about anyone earn some extra income.

“We’re enabling people to invest in and engage with folks in their community in a way that I think we’ve forgotten,” says Leah Brusque, a former programmer with IBM who founded Task Rabbit in 2008, just as the recession was unfolding. “And we’ve done that by turning them into micro-entrepreneurs.”

Online job sites have been around a while, of course, and even sites like e-lance and oDesk have become viable markets to outsource highly-skilled jobs such as programming, design and writing tasks.

But what makes Task Rabbit and the growing number of others like it such as Coffee & Power and Zaarly different is that their jobs vary widely and often involve face-to-face interactions in the real world. Skillshare, for instance, is a site based in New York City that enables people to teach or attend a class on just about anything. A recent search revealed classes ranging from how to eat healthy or how to crochet an Alpaca rug – not online, but in person.

“We are changing the way people think about doing business with the people around them,” says Bo Fishback, formerly the vice president of entrepreneurship at the Kauffman Foundation, who founded Zaarly in March 2011. “We’re making it possible to ask for and get anything, in real time, from the people around you.

Mechanically, most of these sites work in similar fashion. People can post jobs, or bid on them, while the site handles the payment process – usually taking a small percentage fee of the transaction for itself. Both parties involved in a transaction can then rate each other after the job has been completed. At Task Rabbit, which has some 3,000 registered bidders, some $4 million of activity is reported every month, which, while impressive, is still a sliver of the estimated $473 billion earned by freelancers in 2010.

Those kinds of numbers have given high-profile investors reasons to take notice. Zaarly, for instance, reeled in $1 million from a group of investors that included Ashton Kutcher (while also adding Meg Whitman as a board member). Similarly, Coffee & Power, which was founded by Philip Rosedale, the creator of the virtual online world game SecondLife, recently raised about $1 million from investors like Jeff Bezos.

“Our mission has been to find out how you get people who are interested in working for each other to cluster and find each other in the real world,” says Rosedale, whose business plan combines an online market with currently three physical locations – upscale coffee shops in San Francisco, Santa Monica and, soon, Portland, Oregon – where people can meet and make a deal.

There are, of course, critics who point to the fact that it can be difficult if not impossible for someone to earn a living bidding on $100 jobs. But, if the number of people flocking to these sites to not just bid on jobs but also post them continues, we might just see a change in the concept of what a job is.

“We’re still early in the game, but we think we’re reinventing the concept of how we all go about working,” says Rosedale.

The Greatest Running Shoe Never Sold

23 Jan

BusinessWeek
Features January 12, 2012, 4:30 PM EST
The Greatest Running Shoe Never Sold
How hard is it for an independent inventor to sell an idea to a multinational? Try running a mile in Lenn Hann’s shoes

By Bob Parks

(Corrects the year the sneaker was patented.)

Late one night in August 1997, 54-year-old inventor Lenn Rockford Hann placed two bottles of Gatorade near Concourse F of Chicago O’Hare International Airport, unlaced his sneakers, removed his socks, then dodged curious maintenance workers for two hours while running 13.1 miles on the walkways. His pace surprised him. He was convinced the springy, resilient surface was almost perfect. “My legs felt amazing,” says Hann, a marathoner. “I’ve been chasing a shoe that feels that good ever since.”

For years, Hann had been designing a running shoe that he hoped would give him an edge. After his airport run (in the days of lighter security, naturally), he knew he was on to something, and he became obsessed with O’Hare’s movable sidewalks. Finding a walkway in the midst of repair on a subsequent jog, he jumped into the pit to look at its clockworks. There he found rollers on each side, with nothing holding people up in the middle but the belt’s tension. The next day, Hann called the belt company, Dunlop Conveyor Belting, and learned they were adjusted to 2,500 foot-pounds of force to create the right balance.

Athletic brands spend millions every year trying to build a better sneaker that will propel them to the front of the $6.3 billion running shoe business, one of the biggest and most visible areas of sporting goods, with 11 percent growth in 2011, according to industry analyst SportsOneSource. Nearly all sneakers have a sole that looks like lasagna, composed of layers of rubber, foam, and plastic. The fluffy foam is made from ethylene-vinyl acetate, or EVA, which has its critics: EVA adds weight to shoes, and lab tests show it requires more energy per stride. Running shoe companies have long sought an EVA substitute that absorbs shock but also returns more energy. “Consumers like the cushioned feeling associated with a conventional running shoe,” says Darren Stefanyshyn, a University of Calgary researcher and former chairperson of the Footwear Biomechanics Group. “If you could provide that without using foam, you’d have a winner.”

It took him eleven years, but Hann finally converted his airport research into a breakthrough sneaker patented in 2008, a shoe with an entirely different system to cushion and propel the foot. It quickly attracted the attention of fast-growing athletic brand Under Armour (UA), which spent two years and hundreds of thousands of dollars to develop it as the prospective centerpiece of the company’s first line of footwear. Hann’s shoe was scheduled to launch early this year and was poised to rock the footwear industry, but it never quite made it to market.

Hann is a former software engineer with glasses, short brown hair, a high domed forehead, and ears that stick out like antennae. He is talkative, relentlessly upbeat, and consistently attired in marathon T-shirts. His Volkswagen (VOW:GR) bears the license plate TNASHS, for “tenacious.”

In the years following his midnight airport jog, Hann licensed several inventions—an electronic cat toy among them—that brought him modest income, but the shoe was always his favorite project. He tried many materials before landing on carbon fiber, an ultra-strong substance that holds its shape after years of pounding. He engineered carbon fiber shock absorbers into his shoe to give it cushioning and stability in one mechanism. A hinge in the forefoot provided flexibility.

Three days before the 2002 Chicago Marathon, Hann bought industrial carbon fiber fabric and baked it in his kitchen. Once the fumes dissipated, he cannibalized the uppers of a pair of New Balance 763 running shoes for his proto-types. As he hacked off layers of EVA foam from the sneakers with a table saw, his hand slipped and the blade cut deeply into his thumb, embedding bits of blue foam into the wound. Hann rushed to the emergency room, then assembled the shoes the next day.

Hann believes his prototype was responsible for shaving 17 minutes off his record in the marathon. He immediately made more. A member of his pace group wore them, reporting her legs felt “full of energy.” Kris Hartner, owner of Naperville Running in Naperville, Ill., delivered a tougher critique: “pretty good,” he said, but “a bit slappy.” The transitions between midstance and toe-off were “rough.” A shard of carbon fiber came loose, slicing Hartner’s calf.

All the same, Hartner, who has a master’s in biomechanics, took Hann’s concept seriously. When New Balance owner Jim Davis visited the shop, Hartner said he should check out Hann’s shoes. Hann met with New Balance and secured an investor, who contributed $300,000. Hann and the investor made prototypes in Korea, paid an attorney to patent the shoe, and hired an exercise laboratory to test it. The facility found that runners in Hann’s prototypes consumed an average of 2.2 percent less oxygen. That may not sound like a lot, but it pointed to a significant reduction in energy when running long distances.

When it came time to talk price with New Balance, Hann set his offer sky-high. He says he meant it as a starting point, but company executives closed discussions. Hartner remains a supporter of the shoe, but says Hann blew the negotiation. “He would be way better off with an agent to represent him,” says Hartner. “He’s the inventor-scientist guy, you know it from movies. But in real life they sometimes end up shooting themselves in the foot, and it’s hard to watch. They’re not as good at the people thing.”

Six years later, it appeared Hann might be back in business. Kip Fulks, chief operating officer of Under Armour, learned about Hann’s shoe after the inventor completed a small, exploratory project with the company. Fulks wanted to launch a major sneaker development, and in 2009 he invited Hann to the company’s Baltimore headquarters to negotiate. Since its inception in 1996, Under Armour has come out of nowhere with innovative products like its HeatGear compression shirt to stalk Nike (NKE) and Adidas (ADS:GR). The shirt is a nylon garment that hugs the body, and it has largely replaced heavy cotton tees for athletes. But Nike’s annual revenue is around $20 billion vs. Under Armour’s $1 billion, and to truly challenge its competitors, Under Armour needs footwear. (The company hastily designed trainers in 2009, but the attempt impressed neither consumers nor investors.)

The negotiations between Hann and Under Armour were never smooth, but they seemed headed in the right direction. On one side of the table sat Fulks and his designers. On the other was Hann, his investor, and his attorney. First they hammered out an option agreement, a sort of preamble to a longer-term licensing deal. Hann asked for a monthly option fee, basically an advance on future royalties. After some haggling, Fulks agreed to $8,000 per month, to be shared with Hann’s investor and attorney.

Next, Fulks and Hann locked horns over the range for future royalties. Hann asked for 3 percent to 6 percent, a rate more akin to a tech product than footwear. Fulks pulled the pair back to 1 percent to 4 percent. (Aerospace engineer M. Frank Rudy, who sold “Air” to Nike, was awarded a royalty of around a single percentage point when he originally made the deal, according to a source familiar with the contract. Nike would not comment on how much Rudy earned.)

Finally, on Mar. 24, the two signed the option, agreeing to the 1 percent to 4 percent range, with an exact percentage to be determined later. It was a huge step. To celebrate, an Under Armour design manager invited Hann to a nearby bar; they drank beers into the night while talking footwear tech. Hann proudly showed off the blue foam embedded in his thumb. They toasted the new shoe. “At that point, I suddenly realized that more people had gone to the moon than had ever licensed running footwear,” he recalls. “We were almost there. I was in heaven.”

That year, Hann was an electrical storm of activity, calling the company almost daily with ideas. Under Armour made six rounds of “prototype tooling,” the aluminum molds for model shoes, and performed extensive testing with favorable results. The project was getting close to “final tooling”—when expensive steel molds are struck in all sizes, men’s and women’s. Then, in summer 2010, Fulks announced that it was time to settle on a licensing agreement. To Hann, this seemed like a formality. He suggested leaving it to the attorneys. Then he waited.

After a four-week silence, Hann couldn’t take it and called a former Under Armour employee for insight. “It’s a delaying tactic,” guessed the acquaintance. “This is their way of introducing sharp elbows.”

Three weeks later, Hann traveled to Portland, Ore., for a hastily scheduled meeting with Adidas. Executives there were encouraging, but they didn’t want a bidding war with Under Armour. That very afternoon, Under Armour sent an apologetic e-mail with the much-anticipated licensing agreement. (Hann doesn’t know whether this was somehow triggered by the Adidas trip.) It included a royalty rate of 1.5 percent for the first stage of sales, and 1 percent thereafter. Through his attorney, Hann countered with 5.75 percent and 4.25 percent. Hann’s lawyer says Under Armour took the soaring rates like a jab in the eye; Under Armour would not comment on the specifics of the negotiations.

For the next three months, Under Armour refused a face-to-face meeting but did make concessions, raising its percentage and throwing in a monthly advance. Hann held out for higher numbers. He fielded interest from a new set of investors and became more wary of Under Armour. “I feel like the mouse dancing with the bear,” he said. “No matter how careful the bear is, the mouse better watch out.” In late October 2010, Kevin Haley, senior vice-president of innovation, took over the project from Fulks. Haley offered to put the licensing negotiation on hold and renew the option agreement at $15,000 per month. The implication was that this would allow them to work together like old times.

Hann rebuffed the offer, believing Under Armour was bluffing and it was a way of avoiding a licensing agreement. In early December 2010, Under Armour’s attorney delivered the news: The company decided to move in a different direction. Hann’s work with the company was over.

Last month, Under Armour introduced its Charge RC running shoe. It features a strip of carbon fiber along the bottom, not for cushioning but to enhance the ride and response. “It’s a different use of carbon fiber than what we were exploring,” says Haley. “But I think it shows that Under Armour takes an open approach to innovation—we test a lot of technologies and make a lot of different prototypes before arriving at what comes to market.”

Unlike Hann’s prototype, the Charge RC fits the current trend of minimal running shoes; it weighs under 10 ounces and has a sole close to the ground. Hann’s shoe weighs more and sits higher. Asked why Under Armour didn’t go with Hann’s shoe, Haley says: “We go down the path of evaluating new technologies with more people than other companies, so we’re going to encounter more situations where it doesn’t work out for us as a commercial product.”

For Under Armour, making a shoe with such an unprecedented technology would have been a challenge to source, manufacture, test, and market. Could Under Armour have managed those logistics given another few months of exploratory development? We’ll never know; Hann’s over-the-top royalty demands denied it that opportunity.

Hann accepts that he had a role in the falling-out. “I know I screwed up,” he says. “But despite my bumbling efforts, the technology deserves to be out there.” In the last few months, he has continued pitching his sneaker. He says he now has a promising new partner, and is also in talks with a medical device company about an electronic invention for hospitals. He has not hired an agent.

Curious about Hann’s supershoe, I took a few turns around his cul-de-sac in the upscale suburb of Wheaton, Ill., with a test pair. I was surprised to see lots of EVA. Hann argues that some foam is needed to hold the carbon fiber in place, but that it doesn’t cushion the shoe. The sneakers didn’t exactly feel like they were injected with gravity-defying Flubber, but there was something different about them. Even though they weren’t especially light, they felt light—like floating on little trampolines.

Parks is a Bloomberg Businessweek contributor.

©2011 Bloomberg L.P. All Rights Reserved. Made in NYC

Twitter Redesigns Its Site

12 Dec

DECEMBER 9, 2011

By AMIR EFRATI

Twitter Inc. on Thursday announced a redesign of the micro-blogging service and new features to help widen its appeal.

In the biggest announcement since Jack Dorsey, Twitter’s creator, returned to the company as an executive in March, the company said that when people first sign up to use the service, Twitter will help them discover information that might interest them, based on their location and other signals.

“It’s not just a visual redesign but a conceptual redesign to make Twitter more accessible to the next billion users,” said Satya Patel, a Twitter senior executive, at an event inside the San Francisco-based company’s future headquarters in an Art Deco building in a blighted neighborhood here.

The redesign, which will roll out globally over the next few weeks, will add a section to every Twitter user’s account called “Stories” that shows them content on Twitter they may find interesting. “It’s the first step to start to surface all the rich content that’s pouring into the platform for people who are experiencing it for the first time,” Twitter CEO Dick Costolo said.

Twitter announced a redesign of the micro-blogging service and new features to help widen its appeal, Amir Efrati reports on The News Hub. Photo: AFP / Getty Images.

Twitter, which lets people broadcast messages called “tweets” of up to 140 characters in length, is attempting to become an online-advertising powerhouse but still faces challenges including the perception that many people don’t understand how to use the service, which includes symbols such as “@” and “#,” and don’t know what kind of information they can view on it. People use Twitter to keep up with the latest news about everything from technology and politics to transportation delays and promotions by big retailers.

The company recently said more than 100 million people actively use Twitter. The majority of its accounts are based overseas, the company has said.

In August the company raised money at a valuation of more than $8 billion and now has more than 700 employees, who will move into the new headquarters in mid-2012. Its fledgling online-ad business is expected to generate around $145 million this year, according to research firm eMarketer, as brands such as Starbucks Corp., luxury-brand giant LVMH and others dip their toes into Twitter’s ad products, which aims to target ads based on people’s personal interests. That revenue figure is up from $45 million last year.

Mr. Dorsey, who was Twitter’s first chief executive and has long been chairman of its board, said that, on average, between 3% to 5% of people interact with, or “engage,” with ads they see on Twitter. That figure is higher than many other forms of online advertising.

Bloomberg NewsExecutive Jack Dorsey, in New York this year, oversees Twitter’s look.

The five-year-old Twitter is competing with other social media companies such as social network Facebook Inc. for the attention of marketers. Mr. Costolo said Thursday that the company is testing a long-awaited “self-serve” system that lets anyone buy ads on Twitter, similar to the kind of system that propelled Google Inc.’s growth, and that it would become available more broadly next year.

Twitter on Thursday also announced that brands such as American Express and organizations such as the American Red Cross will soon be able to customize their publicly-viewable Twitter pages to have more control of how they look.

The company has leased 220,000 square feet in its future headquarters, a space that “holds thousands of people,” Mr. Costolo said.

High Performance … How Companies Can Stay Ahead of the S-Curve

24 Aug

Successful firms don’t just go from good to great, they do it again and again by managing in tandem today’s business and tomorrow’s

by Catherine Bolgar

What beats the taste of success? Tasting it over and over.

A company finds a winner with a product. It takes off, then gains momentum. Sometimes companies make the ride up last longer by introducing spin-offs or entering new markets.

Unfortunately, at some point, sales level off: markets become saturated, competitors launch even better products and tastes move on. The overall sales trajectory, therefore, resembles an S.

High-performance businesses—the ones that consistently lead their industries over many business cycles—jump from one S-curve to another again and again. How they do that is the subject of a new book, “Jumping the S-Curve: How to Beat the Growth Cycle, Get on Top, and Stay There,” by Paul Nunes and Tim Breene, leaders of the High Performance Business Research program at Accenture, the global management consulting, technology services and outsourcing company. The program was born in 2003 to determine exactly how some companies become high performers, through good times and bad, while others lag behind or fail.

Mr. Nunes and Mr. Breene directed the analysis of the performance of more than 800 companies around the world in dozens of sectors, most over a 10-year span. They identified key differences in the companies that successfully make the jump, versus those that peak, then stall and decline. According to Accenture’s research, high performers:

resolve the conflicting needs of today and tomorrow—trading some of today’s performance for tomorrow’s gain
build a hothouse of talent to nurture employees, which then attracts more people with skills and vision, ultimately creating a talent surplus
change top management while business is still thriving
pursue “big-enough” market insights—ones based on changes in the marketplace that are certain to occur—and sure to shake up the competitive landscape
refuse to scale up for scale’s sake and actively manage the downsides of scale at every turn

The challenge is difficult. The research showed that companies that failed “were not illogical,” says Mr. Breene, the former chief strategy and corporate development officer of Accenture. “They acted reasonably. You can look at why the things they did each year seemed to be the strategically correct response at the time.”
Today and Tomorrow

High-performance businesses juggle the contradictory needs of the present and the future. “While the core part of the business might be working to eliminate failure and error, you have to have parts of the business where intelligent failure is accepted. Failure allows you to get insights and innovations and breakthroughs,” Mr. Breene says.

High performers fix what doesn’t seem to be broken yet. The ride up the S-curve can be exhilarating, but high performers don’t just revel in the success. They use it to prepare for their next act, and they actively manage the cresting of their S-curves.

Companies can try to predict when they will reach the revenue peak on their current S-curve by gauging and forecasting market saturation. But there’s always the danger that disruption will strike—a competitor unveils a new product, or technology makes a leap forward—and the curve’s life will be shortened.

Incremental innovations are useful for extending an S-curve and bringing in revenue to fund the next S, but high performers are “remarkably committed to breakthrough innovation,” Mr. Breene says. “They have market-changing ambition. They look farther out. They are happy working on seven-to-10-year time frames.”

High-performance businesses take a long-term view for talent, too. They understand that it’s not enough to “optimize” the workforce. That’s why they turn themselves into hothouses of talent, where they can give people room to grow. They glean insights from employees at all levels and they give them stretch assignments to learn new skills.

“High performers have much deeper planning and talent-management systems,” says Mr. Nunes, the executive director of research at the Accenture Institute for High Performance.

UPS has long been a “hothouse.” For example, it has a tradition of promoting people from within, says Kurt Kuehn, chief financial officer at the Atlanta-based logistics company who himself started as a holiday-season driver more than 30 years ago. “Because we do focus so much on employees as lifetime assets, we have this incredible residual base of talented people”—what Mr. Nunes and Mr. Breene refer to as a “talent surplus.”

A talent surplus makes a company blossom with innovation and creativity. Employees are not just responding to the challenges of the moment but are thinking about how the company can do something better or new.

“As we create a new S-curve, we need an infusion of new talent,” says Mr. Kuehn. “We mix maybe two parts old skills and one part new skills.”

High-performance businesses like UPS become magnets for “serious talent.”
New Strategy—New Leadership

High performers also constantly groom and challenge the upper ranks to prepare new teams to take over when new strategies require. That means not just the CEO but the entire C-suite.

“In order for the company to evolve ahead of the curve, the top team has to evolve first,” Mr. Nunes says.

UPS has transformed itself through many S-curves. Founded in 1907 as a messenger service in Seattle, it began serving more kinds of businesses, then spread geographically, then added air services, international deliveries and logistics.

UPS’s chief executives have had tenures in the four-to-seven-year range—close to the typical S-curve cycle. There’s no bell that rings when a CEO’s time is up, but since the company’s CEO comes from within, he already has been implementing his vision and strategy even before taking the helm, according to Mr. Kuehn.
Early but Not Too

While high-performance businesses think big, they aren’t always first with an idea. Zenith successfully moved from one S-curve—in radio—to another—in TV—but stumbled as it focused on high-definition TV in the 1980s, well ahead of the market.

By contrast, Porsche of Germany was far from first to market a sport-utility vehicle. Porsche tailored its Cayenne to its customer base, offering a unique SUV, rather than a me-too vehicle. It gained traction gradually—the 911 sports car line remained the best-seller during the Cayenne’s first year. Eventually the Cayenne became the company’s top seller—Porsche took its time to get everything right before scaling up.

The secret at the core of high-performance businesses’ successful market moves, however, is something the authors call a “big-enough market insight,” or BEMI. High performers put wind in the sails of their strategies by moving in alignment with a major market shift. Zenith’s insight was perhaps too big and too soon. Porsche’s insight was recognizing that demographic shifts meant growing demand for SUVs was more than a fad, and that a portion of that fast-growing market would favor a company that could deliver in an SUV everything a sports car lover would want.

High-performance businesses go to extraordinary lengths to understand their customers. Procter & Gamble even sends researchers to live with customers to observe how they use products and to reveal unmet needs.

While tending to core businesses, high performers also prepare for their next S-curve with an “edge-centric” strategy. That is, they pick up insights from looking at the periphery of market evolution and customer demand, often by keeping better tabs on what is happening on the periphery of their own organization.

“While it can look like you’re taking your eye off the ball, moving off into uncharted territory, actually you’re keeping your eye on the ball by searching where the best ideas are most likely to be found,” says Mr. Nunes.

Accenture’s Mr. Nunes and Mr. Breene also point out that size doesn’t correlate with success. In picking out companies that maintained high performance over the long term, they noticed that the winners were often midsize contenders in their fields.

“As you scale, it gets more difficult to sustain the characteristics of high performance,” Mr. Breene explains. “You get more complexity and that leads to a tendency toward process, policy and rules. The emphasis shifts toward incremental innovation. The vitality that made the business great in the first place begins to die as it becomes more like a machine and less like a living organism.”

Adds Mr. Nunes: “Everybody wants growth, but scaling, size and complexity tend to drive out headroom. You need headroom to jump the S-curve.”

For more information:
Accenture
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Tech Mogul Pays Bright Minds Not to Go to College

17 Jun

(While we promote higher education here at Insiders Group Inc, it really isn’t for everyone (Bill Gates was a college dropout, keep in mind).  What’s more important is doing what works best for you and promotes a strong mindset and future.   So read on…)

By MARCUS WOHLSEN, Associated Press Sun May 29, 3:41 pm ET

SAN FRANCISCO – Instead of paying attention in high school, Nick Cammarata preferred to read books on whatever interested him. He also has a gift for coding that got him into Carnegie Mellon University’s esteemed computer science program despite his grades.

But the 18-year-old programmer won’t be going to college this fall. Or maybe ever.

Cammarata is one of two dozen winners of a scholarship just awarded by San Francisco tech tycoon Peter Thiel that comes with a unique catch: The recipients are being paid not to go to college.

Instead, these teenagers and 20-year-olds are getting $100,000 each to chase their entrepreneurial dreams for the next two years.

“It seems like the perfect point in our lives to pursue this kind of project,” says Cammarata of Newburyport, Mass., who along with 17-year-old David Merfield will be working on software to upend the standard approach to teaching in high school classrooms.

Merfield, the valedictorian of his Princeton, N.J., high school class, is turning down a chance to go to Princeton University to take the fellowship.

Thiel himself hand-picked the winners based on the potential of their proposed projects to change the world.

All the proposals have a high technology angle but otherwise span many disciplines.

One winner wants to create a mobile banking system for the developing world. Another is working to create cheaper biofuels. One wants to build robots that can help out around the house.

The prizes come at a time when debate in the U.S. over the value of higher education has become heated. New graduates mired in student loan debt are encountering one of the toughest job markets in decades. Rising tuitions and diminishing prospects have led many to ask whether college is actually worth the time and money.

“Turning people into debt slaves when they’re college students is really not how we end up building a better society,” Thiel says.

Thiel made his fortune as a co-founder of online payment service PayPal shortly after graduating from Stanford Law School. He then became the first major investor in Facebook. In conversation and as a philanthropist, Thiel pushes his strong belief that innovation has stagnated in the U.S. and that radical solutions are needed to push civilization forward.

The “20 Under 20” fellowship is one such effort. Thiel believes that the best young minds can contribute more to society by skipping college and bringing their ideas straight to the real world.

And he has the shining example of Facebook to back up his claim. Thiel’s faith in the world-changing potential of Harvard dropout Mark Zuckerberg’s idea led him to invest $500,000 in the company, a stake that is now worth billions.

Still, the Zuckerbergs of the tech industry are famous because they are the exceptions. Silicon Valley is littered with decades-worth of failed tech startups.

Vivek Wadhwa, director of research at Duke University’s Center for Entrepreneurship and a writer for TechCrunch and Bloomberg Businessweek, has assailed Thiel’s program for sending what he sees as the message that anyone can be Mark Zuckerberg.

“Silicon Valley lives in its own bubble. It sees the world through its own prism. It’s got a distorted view,” Wadhwa says.

“All the people who are making a fuss are highly educated. They’re rich themselves. They’ve achieved success because of their education. There’s no way in hell we would have heard about Peter Thiel if he hadn’t graduated from Stanford,” he says.

Thiel says the “20 Under 20” program shouldn’t be judged on the basis of his own educational background or even the merits of his critique of higher education. He urges his critics to wait and see what the fellows achieve over the next two years.

According to data compiled by the Georgetown University Center on Education and the Workforce, workers with college degrees were laid off during the Great Recession at a much lower rate than workers without degrees. College graduates were also more likely to be rehired.

But for fellowship recipients like John Burnham, 18, such concerns pale next to the idealism of youth. At his prep school in western Massachusetts, Burnham started an alternative newspaper to compete with the school’s official publication.

The entrepreneurial experience of creating something out of nothing captured his imagination. Now his ambitions have grown.

Burnham believes that the world’s growing population will put an unsustainable strain on the planet’s natural resources. That’s why he’s looking to other worlds to meet humanity’s needs.

Specifically, he believes that mining operations on asteroids could hold the key. For the next two years, he’ll be studying rocket propulsion technology and puzzling through the economics of interplanetary resource extraction.

“This fellowship is so much of a better fit for my personality than I think college would be,” Burnham says. “When you get an opportunity of the magnitude of this fellowship, I couldn’t see myself being able to wait.”

You Can’t Be Lazy and Still Want to Change Your Life for the Better

1 Jun

If you’ve read this blog before, or watched my videos or even more so have come to my classes, you know that what I’m about to tell you about really pisses me off.  In a survey taken a few months ago,it was found that most people that are unhappy at their jobs to very little to change their situation.  This is a behavior that leaves me dumbfounded.

For my new readers, I became fed up with my lack of financial success – and increasing debt – more than a decade ago.  After stumbling through bad business ideas and deals, I plunked down and finally discovered the keys to my now continued success.  But even before I found those keys, I declared to my job that in two years (this is in 20o2) that I would be leaving –retiring – and that they should find my replacement.  In that two years I cleared up my $45,000 worth of debt and soon after became a millionaire.  I realized that not everyone has my fortitude, and so I founded Insiders Group Inc. to teach others how to do what I did and am glad to have made others very successful in their own right.  But enough about me, this is about laziness.

If all you do is wallow in your depression, your situation will never change.  Everyone isn’t an entrepreneur, true, but anyone – given they seek the knowledge out to do so – can make something better of themselves for themselves, their families and their communities.

Unhappy Workers Do Little About It, Says Survey

by Kyle Stock

from FINS Technology – The Wall St. Journal

Griping about your job is one thing; doing something about it is something else entirely.

When it comes to hunting for a better position elsewhere, most of us don’t bother, according to a survey released this morning by Accenture. Almost half of the 3,400 workers questioned by the technology consulting firm said they were dissatisfied with their jobs, but only 30% of respondents had any plans to switch employers.

The more common strategy was to build up experience and look for a better opportunity in-house.

“There’s still a sense of commitment to take action with their current employer,” said LaMae Allen deJongh, the author of the study and Accenture’s managing director for human capital and diversity. “We interpret that as an opportunity.”

And while feeling underpaid was the biggest complaint, only about half of those surveyed had ever asked for or negotiated a pay raise.

If companies aren’t in a position to hand out raises, deJongh said they should offer promotions, greater responsibility and flexibly work arrangements to keep employees happy.

There is some evidence that job dissatisfaction is running particularly high. A recent report by the Conference Board, a nonprofit, New York-based research firm, found that 55% of Americans are dissatisfied with their jobs, the highest level in 22 years. Respondents also said the best part of their work as the company of colleagues and the commute.

No doubt, much of the recent discontent is tied to the economy at large. Those still in the workforce are likely doing more and earning less — or at least not much more — than they were a few years ago. And many are likely slogging away in positions they have little interest in.

Then again, there are almost 14 million people still looking for work — something to consider next time you feel like griping about your paycheck.

article: Facebook, Zynga, Groupon minting billionaires

7 Apr

This is a pretty interesting piece published by MarketWatch a few weeks back in how internet entreprenuers are wasting zero time in cashing in on their investment…which makes sense given the current financial climate. Yet, as I repeatedly tell you all in my classes, videos , etc…money doesn’t disappear, it just gets transferred into other outlets.  These millionaires are proof positive of that.  Check it out for yourself and let me know what you think:

Facebook, Zynga, Groupon minting billionaires

Commentary: Internet insiders who don’t need IPOs to cash in

By John Shinal of FINS.com

Early investors and executives of the hottest Internet startups know something that retail investors hoping to get rich on their expected IPOs may not: A sizable chunk of the value in companies such as Facebook and Groupon has already been cashed out.

And most of what hasn’t will still belong to insiders after any initial public offering.

Take Groupon, the fast-growing online coupon service that was founded in late 2007 as a way to help people raise money for their favorite causes. Since morphing into a group buying site, it’s raised a tidy sum of money for its owners.

When Groupon closed a huge investment round near the end of last year, the majority of the $950 million it received didn’t go to fund company operations. Instead, $573 million, or 60%, was paid to existing shareholders selling their stakes, according to a January SEC filing.

It was the second time in less than a year that Groupon insiders were selling, as a filing for the company’s previous round, in April, 2010, said part of the amount raised was used to “facilitate liquidity for employees and early investors.”

That means founder and CEO Andrew Mason and other early employees, as well as venture capital investors New Enterprise Associates and Accel Partners, likely don’t need an IPO to get rich off Groupon, which is reportedly now raising another round that could value it as high as $15 billion.

The same holds true for those who were early into any of the latest batch of fast-growing Web companies. Based on public filings and widely reported valuation of private-market transactions, the combined worth of equity in Facebook, Twitter, Groupon and Zynga Game Network is somewhere between $75 billion and $90 billion.

If accurate, those reports mean their aggregate valuation has more than doubled in less than a year. And with reports of new funding rounds emanating almost weekly, the valuation continues to grow, leading some to call the investment climate a new Internet bubble.

“Whenever you have new value being created, you’re going to have a bubble,” said Tim O’Reilly, founder and president of O’Reilly Media and a veteran observer of Silicon Valley. “Investors don’t know how to value it.”

Even if the market crashes and investments in the second wave of Web companies never pan out for individual investors, those with big stakes in the startups are staring at big future gains and, in some cases, have already pocketed some major cash.

Facebook

In January, Facebook said it raised $1.5 billion of investment that valued the company at $50 billion. The latest round came from Russian investment firm DST (formerly Digital Sky Technologies), Goldman Sachs Group Inc. (NYSE:GS) and Goldman’s non-U.S. clients.

The valuation was more than twice the $24 billion the company was reportedly worth in July, 2010, in private market trading. Since then, global users of the world’s largest social networking service increased to 600 million from 500 million.

More recent talks reportedly value Facebook at $65 billion. At that level, co-founder and CEO Mark Zuckerberg’s 24% stake is worth more than $15 billion, by far the largest stake in the company. Several other early employees and investors also have multibillion-dollar stakes in Facebook.

Russia’s DST and the Silicon Valley venture capital firm Accel Partners each own 10% of the company, with each stake now worth $6.5 billion.

Facebook co-founders Dustin Moskovitz and Eduardo Saverin own stakes of 6% and 5%, respectively worth $3.9 billion and $3.25 billion. Sean Parker, an early investor and former executive of the original Napster music service, owns 4%, worth $2.6 billion. Peter Thiel, who founded PayPal and now runs a hedge fund, owns 3%, or $1.95 billion.

Trading in Facebook shares reportedly is active in private markets such as SecondMarket, suggesting that at least some early Facebook investors are cashing out.

Several reports have pegged Facebook’s 2010 revenue at $1.97 billion, and one private investor who has seen the company’s financial reports told me it generated $680 million in cash last year.

The company, based in Palo Alto, Calif., declined to comment for this story.
Twitter

In December, Twitter reportedly raised $200 million, valuing the company at $3.7 billion. Investors included the marquee Silicon Valley venture capital firm Kleiner Perkins.

The valuation is more than triple the amount that investors paid in a funding round just a year earlier. Recent discussions have pegged the company’s worth at up to $8 billion, making the stakes of Twitter co-founders Biz Stone, Jack Dorsey and Evan Williams likely worth several hundred million dollars apiece.

That’s not bad considering that Stone, in an onstage interview at a Federated Media conference in February, said of Twitter: “we’re just in the early phases of being a real business.”

The San Francisco-based company is not profitable and had 2010 revenue of $45 million, according to The Wall Street Journal.  Among other Twitter shareholders are several prominent tech investors including Ron Conway and Marc Andreesen and venture capital firms Union Square Ventures and Charles River Ventures.

Twitter didn’t respond to a request for comment.

Zynga Game Network

Zynga, a maker of social games played mostly on Facebook, is reportedly in talks to raise a $250 million funding round that values the San Francisco-based company at between $7 billion and $9 billion.

That’s a huge leap in valuation for a three-year-old startup that in April, 2010, filed papers to issue new stock that valued the company at $4 billion. In December, 2009, Zynga raised $150 million from Digital Sky Technologies in a transaction that reportedly valued it between $1.5 billion and $3 billion.

In July, 2010, Zynga took $147 million in investment from Softbank (PINK:SFTBY) , (TOKYO:JP:9984) , a Japan-based Internet investment company, as part of an agreement to create a joint venture called Zynga Japan.

At the more recent valuation, founder and CEO Mark Pincus’s stake could be worth at least $1 billion, given that founding CEOs with no co-founders typically own at least 10% of their startup if the company is profitable early on, as Zynga reportedly has been. Read related story: Millions at stake as startup equity pay rises.

The company generated $400 million in profit last year on revenue of $850 million, the Journal reported.

also check out their reference article: Facebook, Twitter, Zynga Bubbles Minting Millionaires