The Bonus Conundrum and Saving Money on Calls
BY Max Chafkin
Bad bonus? For a second day in a row, the business press is focusing on the $165 million in bonuses AIG paid to employees who helped bring the company down. The Wall Street Journal looks at who these people are and how much they made, discovering that 11 of the 73 people who got more than $1 million in "retention" bonuses have already left. The numbers are staggering--and as the New York Times points out, ownership (that's you and me now) isn't happy--but the fireworks raise another question: How should companies retain employees during bad times. Inc.'s Kasey Wehrum tackled this question in the November issue and discovered some good ideas: give less cash and more equity, structure bonuses to reward employees for intangibles like hard work, and, if bonuses are being cut, alert employees well in advance.
Obama's internet whiz (and Facebook cofounder) moves on. FastCompany's Ellen McGirt has the scoop on a move by Chris Hughes, a Facebook founder who most recently worked with president Obama on his digital campaign, to a venture capital firm called General Catalyst. The Cambridge VC has backed Kayak and Birghtcove. When you're done catching up on the latest, check out McGirt's excellent cover story on Hughes in this month's FastCompany.
Another band goes entrepreneurial. The Counting Crows have fired their record company and struck out on their own, Techcrunch reports, joining bands like Radiohead and Nine Inch Nails which have decided to self-publish their music. Front-man Adam Duritz explains it thusly: "The internet opens a world of limitless possibility, where the only boundaries are the boundaries of your own imagination." Techcrunch thinks this will lead to "an explosion of music related innovation." One such innovation: the name your own price album, which Radiohead tried last year and which Inc. magazine tried to copy. Curiously, what worked for an internationally renowned rock band didn't so much work for us.
Calling for nothing. The impending release of Google Voice is just the latest in a series of developments that can offer small businesses basically free phone services, Gigaom reports. The article recommends using Skype or Google voice and avoiding paying for any metered phone service: "If you're paying anything more than a penny or two a minute for calls, except for certain international routes, you're getting ripped off." Once the phone system is retooled, check out this Inc. story on free services for the rest of the office.
Sun shines on SXSW. Despite all the hand-wringing outside of Austin, within South by Southwest, tech entrepreneurs hope to be part of the solution to the recession, the LA Times reports. A workshop titled "What do I do with myself, now that the economy has collapsed?" featured a panel of dot-com survivors who lived through a bust and regrouped. "Broke is the new chic," said Bryan Mason of San Francisco, who led a panel that urged people to quit their jobs and start new ventures.
Microbreweries, a recession-friendly startup. Despite the downturn, the WSJ says that demand for microbreweries is on the rise. New openings of microbreweries last year marked the highest number since 1999. The costs of starting-up are still steep though when you factor in property, brewing equipment, and other assets needed to get going. One Florida-based entrepreneur says he has leaned on the helping hands of volunteers to get his brewery up and running. Luckily, he can reward them with free beer.