Monthly Archives: November 2012

RingCentral Creates Business-Class SMS

As technological means of communication become more and more popular, businesses have to choice but to keep up. These days, most people prefer texting to actual phone calls, leaving retailers and other service providers with a tough challenge.

RingCentral, a cloud telephone systems business, has come up with a solution: business-class SMS. Matt McGinnis, director of product marketing at the company, explained the idea to Venture Beat.

“This is the industry’s first SMS for business phone systems,” he said. “Texting for work giving you much more efficiency, flexibility and empowerment. You can really leverage your business numbers to improve customer contact, colleague collaboration, etc.”

The innovative solution uses cloud-based technology to work across a variety of devices, including smartphones, tablets and PCs. Highly flexible, the business SMS program will allow businesses to text both customers and employees alike.

“Being able to text individual departments is a key feature,” McGinnis explained. “You could broadcast that there’s a meeting at 2 p.m. or give them thanks on a job well done.”

Small Business Saturday in Connecticut

Small Business Saturday, recently celebrated by shoppers throughout the U.S., was a lucrative event for both residents and local businesses. In Milford, Connecticut, many dedicated consumers ventured into boutiques late on Friday night to get a head start. The day was designated to support small businesses during the momentum of Black Friday, and has been successful so far.

Linda McIntyre, owner of Villa Gourmet in Milford, explained:

“I know there are irresistible bargains at 4 a.m. at the mall, but in their hearts they [shoppers] want to support small businesses.”

According to Paul Mangels of H. Mangels Confectioner, people really care about local businesses and their prosperity. “They worry that if a small business closes, it’s gone forever,” he said. “It’s nice to hear how much people care. It’s encouraging.”

Deborah Mollica, a resident of Shelton, explained: “I’m not shopping for the holidays but I want to support small businesses. And while I’m here in Milford, I’ll go to other stores.”

Sean McGinley, another local customer, added: “They should do this more often. They need the support. They need the help. They have one-of-a-kind pieces. At the big box stores everyone has the same kind of stuff. It’s mass produced. It’s not special. Here, it’s unique. That’s why we go shopping here.”

China’s Economy Sees Growth, Stocks Climb

Many experts believe China’s economy is headed for a turnaround. Recent analyses of the country’s manufacturing activity show that this may in fact be true.

This month saw an increase in the preliminary HSBC China Manufacturing Purchasing Managers Index, which reached 50.4 compared with a 49.5 reading in October.

Fox Business explains that a reading over 50 implies growth, while readings below reveal a dip in the industry.

Qu Hongbin, HSBC Chief Economist for China said the reading “confirms that the economic recovery continues to gain momentum towards the year end.”

After HSBC’s report, various markets in the region saw immediate improvements. Hong Kong stocks climbed to recover around 142 point, while the yuan also rose against the dollar.

Still, economists are calling for additional loosening of monetary policies in the region. According to Citigroup’s Ding Shuan, China is likely to listen, at least for now.

“There have been few signs of overheating yet, so in the short term more loosening policies can be expected,” Nomura’s economist Zhang Zhiwei agreed.

Company Focus: Victory Schools

Victory Schools is a New York-based company working to create, support and improve schools in the area. They offer consulting and other services from the very first day of developing a new school.

Victory Schools prides itself on its ability to provide immediate guidance during the very first stages of the process, including meeting with the planning team and establishing a clear vision for the charter school; writing the charter application; prepping the team for interviews; providing incubation space such as offices, phones and computers during project development; as well as providing financial support before the initial public funding.

The company continues to support the schools as they grow, providing academic and educational services as well as technical ones. They offer principal coaching, school-based professional development plans, strategic thinking for each school’s individual needs, and implementation of changes and new programs. They also provide data analysis conversations on a monthly basis, as well as assistance with preparing the Consolidated Application for the No Child Left Behind programs.

According to Victory’s website, the company’s mission is to “help communities create great schools.”

“Above all, we value universal access to a high quality education. Everything we do is in support of this key value.”

The United States Department of Education said:

“Every time a child learns, it is a victory- a victory over ignorance, a victory over poverty, and a victory for opening a world of knowledge. This is the goal of Victory [Schools], a private, education management and consulting company that aims to provide high-quality, personalized service to public schools and school districts.”

 

Small Businesses Cautious but Optimistic

According to a Bank of America survey, Boston-area small business owners are feeling optimistic, if cautious, about the upcoming fiscal year.  Many expect to increase sales as well as workers throughout 2013.

Though 9% of small businesses in the region expect revenue to fall in 2013, more than half of those polled project significant increases. Similarly, only 2% plan to cut staff, while more than a quarter plans to expand their workforce.

Business owners from other cities gave similar feedback.

“I think they’re optimistic,” said Bank of America’s national sales executive Anna Colton. “I find that really encouraging.”

Chris Constantino, president of Camio Custom Cabinetry, shared that his small business was able to hire two new workers over the past year. Though the national business environment makes him nervous, he believes his company will continue to gain market share.

“I am optimistic things will be better for us,” he said. “But I am not sure the economy will be better next year.”

The recent elections will also have an impact on the economy, regardless of the winning party. RC’s Grand Coach & Limousine owner Richard Caraviello explained that his business was unusually slow this year as a result of the elections.

“People were afraid of the elections and the uncertainty about who was going to president,” he said. “At least you know there is going to be a person in charge, and you can work around that.”

Integrative Approach for Private Equity Companies

According to a study undertaken of 50 private equity firms, when investing in lesser-known EMs, more ground work is required than for developed markets.  The solution is to adopt a full integration approach – less necessary for developed markets investments. This is because EMs come with additional risks than developed markets.

What are the benefits of an integrated approach? It results in vigorous scrutiny of both the commercial and reputational concerns of EMs. (This is crucial for when issues of jurisdictions and government involvement arise.)  The problem is, however, that establishing an integrated approach is not so straightforward.  Indeed, according to global editor-in-chief of ‘Mergermarket,’ Giovanni Amodeo, it is costly.   Private equity houses require on-the-ground experience, which means they need to ascertain a comprehension of the local, political and regulatory environment of the regions as well as the operations of the target company and any potential corruption issues that may arise.

That is very much where the issue is. The fact that it is quite challenging for private equity firms to set up this integrative investigative approach is exactly what renders it so important.  It has been shown through the Transparency International’s Corruption Perceptions Index that EMs have a much lower rating than their developed market counterparts.  On a scale of 0-10 (with lower figures reflecting higher incidence of corruption), the best score in an EM region was a mere 3.6 (for the Middle East).  Thus it is clear that a much “tougher” approach is required for EMs, as Amodeo notes.  Developed markets have a totally different – and usually more reliable – accounting process than their EM counterparts.

Nonetheless, despite all these issues, EMs are still attractive regions for private equity firms to invest in.  Out of the 50 investors surveyed, 34 recognize growth potential in BRIC countries; 25 in Central and Eastern Europe and 22 in sub-Saharan Africa.

Small Business Advocacy Groups Rally to Avert the Fiscal Cliff

Small business advocacy groups have been appealing to Washington to call off the $607 billion tax increases and spending cuts set to start in 2013 immediately. Aside from the fiscal cliff issue, many organizations have put forth complaints regarding federal contracting reform and the never-ending government investment into clean and renewable energies.

The National Small Business Association stated: “The bevy of tax provisions set to expire at the end of 2012 will exacerbate small-business economic woes and uncertainty. In addition to providing a phase-out for these provisions, NSBA is calling for sound, responsible tax reform that promotes economic prosperity- not threatens it. Any proposal must address taxes, spending, and entitled reform.”

“There is no reason why all tax relief measures set to expire at year end cannot be extended for another year to allow for a working transition period on tax reform,” added Karen Kerrigan, the president and CEO of Small Business & Entrepreneurship Council.

Meanwhile, National Association for the Self Employed president and CEO Kristie Arslan said: “The critical issues facing the country and America’s self-employed remain, tax reform being of the utmost importance to ensuring continued economic recovery.”

“Now that the campaign is over, it’s time to get down to the important work of addressing looming issues such as the immediate ‘fiscal cliff’ and the related need for rational long-term fiscal policies that continue to offer targeted support for small businesses and the growing economy, while addressing the need to bring down our deficit,” said John Arensmeyer, founder and CEO of Small Business Majority.

Brad Close, the vice president of public policy of the National Federation of Independent Business also added his opinion to the mix, saying: “The expiring tax rates are a huge deal…. Some kind of fiscal cliff solution that doesn’t raise taxes would remove a lot of uncertainty in their minds right now.”

Company Focus: Eagle Bulk Shipping

Eagle Bulk Shipping Inc., a Marshall Islands corporation, is one of the leading owners of Handymax dry bulk vessels in the United States. Focusing mainly on ocean transportation of both minor and major bulk cargoes, the company ships iron ore, coal, grain, cement, fertilizer and many other commodities on global shipping routes.

Founded by Sophocles N. Zoullas in 2005, the Eagle Bulk Shipping’s low cost structure and reliable chartering strategies buoyed the company to the head of the dry bulk shipping market, laying a solid foundation for continuous growth. Now, Zoullas sits as CEO and Chairman of Eagle Bulk Shipping, heading a team with more than two decades of experience.

Eagle Bulk Shipping prides itself on its fleet, which consists of mainly Supramax class vessels. These ships range in size, reaching as much as 60,000 deadweight tons. With the ability to carry cranes, these vessels provide incomparable flexibility for cargo loading and unloading. According to the company, the Supramax class vessels provide “a distinct competitive advantage in the dry bulk marketplace.”

 

Focus on Companies: Oasis Investment Limited

Despite what some observers see as a slow-down in the Asian investments sector, there are several hedge funds that have proven these observers to be too pessimistic. Take for example the recently launched Oasis Investments Limited fund, which had an extraordinary beginning.

During the first 14 months of investing with its internal funds the global market-neutral, multi-strategy, multi-asset fund returned at a 100 percent annualized rate, setting the stage for much excitement when the fund finally opened its doors to outside investors in the late summer of 2011.

The goal of Oasis Investments Limited, whose Oasis Investments Master Fund II will continued the investment strategies of its first 14 months is to reach total assets under management of $1 billion.

The interest expressed in Oasis Investments Limited is part of a more general trend of increased interest in the Asian marketplace. Hedge funds have added $93.9 billion to the industry from investors during the first four months of the year, topping the previous year’s increase of only $28 billion during the corresponding four months.

It is true that hedge funds are still behind the $192 billion where they were at the end of December, 2007 when the international financial crisis first reared its head. However the past year has shown net positive flows into the industry, according to AsiaHedge, an important tracker of hedge fund trends.

Disney Co. Purchases Lucasfilm Ltd. for $4 Billion

Walt Disney Co. is purchasing Lucasfilm Ltd. for a little over $4 billion. Chief Executive Officer Robert Iger’s $15 billion bet on creative franchises has been strengthened thanks to the ‘Star Wars’ and ‘Indiana Jones’ films.

George Lucas is the sole owner of both series. According to a statement from Disney, Mr. Lucas will receive half his payment in cash and half in stock, making him one of the largest investors in the company.

Iger, who has already spent $11.2 billion to acquire Pixar and Marvel, believes memorable characters will be valuable regardless of their medium.

“Technology has proved more friend than foe to great storytelling,” Iger said. “It allows us to distribute in ways we never though would have been imaginable.”

Matthew Harrigan, an analyst at Wunderlich Securities Denver, said: “If Disney is really trying to focus on the tent-pole, event pictures, and given that this is something that has huge carryover value in the parks and merchandise business, it certainly makes sense. This is just the paradigm of the sustainable Hollywood franchise.”

The new Star Wars films, to begin in 2015, will likely follow in their predecessors’ footsteps, with Lucas staying involved as a creative consultant. According to data from Bloomberg show, Lucas will receive 40 million Disney shares. This will make him the second-largest non-institutional shareholder. The largest is the late Steve Jobs, who sold Pixar.