Obama uses entrepreneurship to engage Muslim world. Fulfilling a pledge he made during his speech in Cairo last June, President Obama is hosting a two-day Presidential Summit on Entrepreneurship that brings together entrepreneurs from over 50 countries, most with large Muslim populations. As Reuters reports (via the New York Times), the goal of the summit is to link up entrepreneurs with venture capitalists, development bankers, and business experts "to discuss ideas and share experiences with a view toward creating support networks that will help promote development in the region." While Obama is expected to announce some new funding to support entrepreneurship, Reuters reports that administration officials have stressed that the ultimate aim is for the government to serve as a catalyst between entrepreneurs and potential investors, not a funding source.
The leaner, the better for Internet start-ups. Low-cost open-source development tools, "the smallest set of features that will please some group of customers," and maybe an angel investment. As The New York Times explains, this is the recipe for companies at the forefront of entrepreneur Eric Ries's "lean start-up" movement.
Are we in the age of Facebook? If you ask Ron Conway, the hardest working man in Silicon Valley, the answer would be yes. A post at Tech Crunch reflects on the explosive growth of the company over the past few years, noting Facebook now has 400 million users and 500 million people visiting the site each month, second only to Google for monthly page views. "They are the universe," Conway told Techcrunch.
The professors behind Wall Street's worst ideas. In his Bloomberg BusinessWeek column, Brendan Moynihan makes the argument that some of Wall Streets biggest disasters have come from "ideas hatched in the ivory tower." Even the theories of John Maynard Keynes, now in vogue, are not exempt. Moynihan starts with NYU Edward Altman, who published a paper in 1985 about the default rate for junk bonds. The paper inspired Michael "the junk bond king" Milken to start arranging bond issues to finance the decade's boom in corporate buyouts. The theory, shared by Altman and Milken, that investors could ramp up returns without increasing risk played itself out in the collapse of the savings-and-loan industry a few years later. Another 1980s disaster rooted in academic findings was portfolio insurance, pioneered by the three academics behind Leland O'Brien Rubinstein, which helped usher in the October 1987 stock market crash. Readers of Roger Lowenstein's book When Genius Failed, will be familiar with Moynihan's next point about the Nobel prize laureates behind Long-Term Capital Management whose theories caused a 22 percent decline in a the S&P. In March 2000, professor David X. Li gave the world his Gaussian copula formula, which helped launch the sub-prime credit bubble. Wired called it the formula that killed your 401(k). (Hat tip, peHUB)
Gilt Groupe edges onto Groupon's turf. Groupon may have recently received a $1.2 billion valuation, but now they may have yet another competitor for its group buying services. Gilt Groupe, a site for bargain-priced luxury brands just launched a local service called Gilt City, so far only available in New York (via Fast Company). The new service offers limited-time coupons and deals for local businesses but without the minimum number of buyers to secure a deal which might make it less vendor friendly.
Financial social network slips up. Blippy, the quirky start-up that basically gives your credit card its own Twitter account, has been criticized for allowing users to share too much information. But until Friday the debate about the company was merely philosophical. After all, Blippy's users were choosing to tell the world about their credit card purchases. But then VentureBeat discovered that a handful of users' credit card numbers were inadvertently released to Google, giving Blippy, "a PR nightmare," according to TechCrunch. The blog explains what happened and breaks down Blippy's response, giving the company high marks for transparency. "I'm overall impressed with how the founders have navigated their first crisis‚--Blippy can rebuild and secure the public's trust," writes Evelyn Rusli. "But the founders should know in this game, you don't get three strikes."
Staff editor KASEY WEHRUM has written for Inc. magazine on subjects ranging from the businesses behind professional bull riding to gadget inventor and father of the infomercial, Ron Popeil. His work has appeared in the New York Times, Worth, Budget Travel, and on MSNBC.com. He lives in Brooklyn.