Cash for Clunkers as Economic Stimulus; Startups Diversify
BY Nitasha Tiku
Cash for clunkers helps an unlikely industry. By all counts the "Cash for Clunkers" program has been a runaway success. The Wall Street Journal says that the $1 billion program may be the most efficient of all the economic stimulus programs rolled out by the Obama administration--and the program has sent auto sales skyrocketing. This morning's Journal has a front page story on another result of the popular program: a boom in the chemicals business. Because Cash for Clunkers requires that dealers disable the cars that customers trade in, there has been a run on sodium silicate, which can be used to destroy a car engine. Chemical sellers haven't been able to keep the stuff on their shelves. One company in South Carolina, normally sells 150 gallons of sodium silicate a year. Last week, it sold 4,600 gallons of the stuff.
Ask not what Harvard can do for you... When you have a name like Harvard, you can throw your weight around a little. But even some of the school's own professors are questioning the Ivy League institution's recent ambitious trademarking efforts, The Boston Globe reports. Harvard currently has the rights to JFK's "Ask what you can do" and the everyday phrase "Lessons learned". And Harry Lewis, a computer science professor at the university, isn't happy about it. "To lock down common English phrases seems to be antithetical to the spirit of what universities are supposed to be about." Lewis makes a good point, but Harvard's practices got us thinking at Inc. What have we been waiting for all these years? We're putting out applications on "American entrepreneurship" and "fast-growing private companies". (Via peHUB).
Sports teams fighting slumping ticket sales with....yoga? The LA Times took a look recently at new sports marketing efforts professional sports teams are employing to combat the recession's effect on ticket sales. On a recent afternoon, 100 people paid $100 each to practice yoga at Dodger Stadium under the guidance of outfielder Andre Ethier. The Dodgers have also offered nighttime batting practice at the stadium, bringing in $170,000 over three nights. And in Detroit, Tigers fans dish out $1,250 for a day's work as a groundskeeper. Why do we like these business moves? Because the teams are offering new services, while utilizing existing assets.
Internet startups move into branded entertainment after online ads fizzle Slide, a San Francisco-based app-maker that develops popular games for social networks was gaining traction last summer when founder Max Levchin decided to open an ad-sales office in New York to sell standard campaigns for $50,000 to $200,000 a pop. But after that fizzled in the recession, Levchin fired his ad-sales team and refocused on branded entertainment "where an advertiser is incorporated into games that are already popular among consumers," reports the WSJ. Slide is also revving up its virtual goods business, selling things like spoofs of well-known works of art. It's not alone: companies like Rock You, Zynga, and Meez, are also diversifying into branded entertainment and hawking virtual goods. A year ago, VCs were tripping over themselves to invest in companies like Slide (which picked up $75 million in funding), but app or widget-makers for social networks like Facebook and MySpace have lost cache as New York ad-sales execs failed to deliver in tough times. Check out our horse race following the most promising players in branded entertainment. Or read our archives to learn more about Levchin, who co-founded PayPal, invested in YouNoodle, became a gazillionaire before the age of 35.
Ancestry.com files for IPO. Ancestry.com, a website that allows people to make family trees online, has filed for an IPO, according to Business Insider. The company makes money by selling subscriptions. Rory Maher says there's a lesson here for all the advertising-based web companies out there: "Startups should take note. While pure-play advertising companies have struggled to grow the past year, many business with alternatve revenue streams like subscriptions and commerce have thrived." He cites Open Table, which charges restaurants to set up reservations and which is flying high after an IPO earlier this year.
Reporter NITASHA TIKU covers technology, finance, green business, and social entrepreneurship for Inc. magazine and contributes to the staff’s daily links blog. Her work has appeared in New York magazine, The Villager, Chelsea Now, and on nymag.com. She lives in Brooklyn, New York. @nitashatiku