Con Artists Target SBA Loan Seekers
Scammers and the SBA. Surinder Multani shepherded businesses like gas stations and convenience stores through the SBA loan process by putting together loan applications for lenders to approve through his loan-brokerage firm Abacus Finance. But while Multani collected more than $500,000 in commissions, his clients defaulted or liquidated on about half the loans--the result of his fraudulent and inflated claims of their net worth and capabilities. Multani brokered almost 50 loans worth $44.3 million and was sentenced to 11 years in prison. But he's not alone. Scam artists have always plagued the SBA, but as sources of capital have constricted, the Wall Street Journal reports that a new crop of con artists have come to light. In some cases they demand exorbitant fees by claiming they can guarantee loan approval. They also solicit loans bigger than the business owner can repay, leaving borrowers tangled up in fraud allegations (whether or not it was intentional) and financial trouble. The SBA says its SBA Express Loans are a big target for loan-agent fraud.
An App Store for Your Browser. The biggest news to come out of Google's I/O conference yesterday was the announcement of the Chrome Web Store, reports TechCrunch. It's just like the iPhone or Android app store, but for your Google Browser. The store will highlight web apps and offer developers a way to monetize them (if they choose to charge). For now, it's Chrome only, but the apps are written for the web, so TechCrunch says they should work on any browser. In terms of revenue sharing, developers can expect the standard 70/30 split (developer/Google).
Nothing to fear but fear itself. At yesterday's Google I/O conference, a panel of VC's was asked, "What are the biggest no-no's in a start-up?" Tech VC Brad Feld replied that "fear is the biggest no-no" That answer struck a chord with Fred Wilson, who recalled that, "If I look back over 20+ years of entrepreneurs I've backed, the ones who were anxious and afraid of failure most certainly had worse outcomes than the ones who were agressive and confident. You simply can't be tentative in a start-up. You have to go for it at every chance you get." Wilson explains that fear has a way of trickling down in an organization, so an anxious leader will result in an anxious company. Therefore, "A person who is quietly confident makes the best leader. So if you are starting a company or building one, face your fears and move past them. It's critically important to your company."
Can Groupon survive all the copycats? Slate's The Big Money says "Yes," noting that the business is profitable, easily scalable, and that "deals from similar social-coupon sites rarely compete with one another on a daily basis." But as we explained in our piece on the pros and cons of partnering with Groupon, the Chicago-based company usually takes about 50 percent of the revenue from the coupon sales. Surely, some of its competitors take less than that to acquire a competitive advantage. And if that trend continues, what's to say there won't be a race to the bottom?
Helping gay entrepreneurs succeed. StartOut, a new network for LGBT entrepreneurs, helps tackle the challenges of being openly gay in the working world. Founder Darren Spedale tells The New York Times the idea behind StartOut was "a no-brainer" because there were already a number of networks like Astia or TiE that catered to specific demographics of entrepreneurs. So far, the year-old company has attracted 1,000 participants to its events in New York, San Francisco, and Los Angeles. StartOut hopes to educate gay teens about opportunities in entrepreneurship and help the men and women within StartOut to find contacts and funding. Though it has no official membership, aside from Facebook fans, StartOut has plenty of room for growth. As the article reports there are 1.2 million gay-owned businesses in the United States alone.
Could your pants soon power up your iPod? Researchers at UC Berkeley on working on microscopic fibers that can produce electricity from simple body movements like bending and stretching, the LA Times reports. The researchers say that the fibers (which look like tiny fishing lines) could be woven into clothing and plugged in to charge electronic devices. The technology is still a few years away from the market, but the potential is there for these portable generators to be a breakthrough technology, the Times says.
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