- Over half of 2009 Fortune 500 list were launched during a recession
- A nation of clean-tech inventors to get fast track patent service
- Internet video consumer electronics shipments to quintuple
- Accelerometers set to become mainstream MEMS device by 2013
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According to a new study by the Ewing Marion Kauffman Foundation, challenging economic times and subsequent unemployment can benefit new enterprises: entrepreneurs may view unemployment as an opportunity to start a company, and seize the advantage provided by the ability to tap into a larger pool of potential employees. The report also suggests a broader economic trend, with job creation from start-up companies proving to be less volatile and sensitive to downturns when compared to the overall economy. Click here for more.
Normally, inventors of novel technology, take advantage of upto three years of delay in securing patent grants. The delay allows them to protect the details of their inventions from potential competitors, allow further time to build functional prototype, prove their technology and raise funding for fully developing the product or service. However some inventors, like to secure their patents rights, as quickly as possible, in order to provide leverage in negotiating license fees, royalties, further development funding and partnership deals. The UK Patent office, now offers a fast track (nine months) for patents in the cleantech sector. We examine this further. More here.
“The expansion of broadband Internet access from home computers to other devices including STBs (set top boxes), Blu-ray players and video game consoles has opened up a world of new possibilities for supporting Internet video via streaming and downloads,” says a leading analyst for consumer electronics. Driven by the broadband access boom, global shipments of consumer-electronics devices capable of supporting Internet video are set to rise by nearly a factor of five from 2009 to 2013. By 2013, 376.5 million entertainment-oriented consumer electronics platforms with the capability to support Internet video will be shipped, up from 80.5 million in 2008. Click here to read more.
When you turn your iPhone to the side and the screen automatically adjusts from portrait to landscape view, there’s an accelerometer at work. When you swing your Wii controller and bowl a virtual strike, there’s an accelerometer at work. Recently, accelerometers have emerged as a critical input device for some of the world’s hottest electronic products, causing shipments to boom and expanding the micro-electro-mechanical system (MEMS) market. This will make accelerometers the top-selling) device by 2013. Read more here.
The British Business Angels Association, the UK trade body representing angel and early stage investing, in partnership with the UK’s nine regional development agencies (RDAs), local business angel networks and BERR have kick-started a national PR and marketing programme to encourage and recruit more angel investors. Angels bring 'smart money', offering not only finance, but important skills and experience to build small businesses - but there are now insufficient business angel investors in the UK to provide early stage risk capital to SMEs in the current downturn. Read more here.
Despite the poor economic climate, new business formation in the US continued to increased in 2008. It was mostly lead by immigrants, women, and older Americans (aged 55 to 64), according to latest trends data found in the annual Kauffman index of entrepreneurial activity. An average of 0.32 percent of the adult population (or 320 out of 100,000 adults) created a new business each month - representing approximately 530,000 new business formations per month - as compared to 0.30 percent in 2007. There is , however a potential harbinger behind these figures. Click here to read more.
Compound Semiconductor Technologies Global Ltd (CSTG), a specialist opto semiconductor manufacturer (foundry) addressing fabless companies in defense, medical, industrial and communications markets, has received a $6 million boost to its balance sheet. The deal comprises of $3.4million of new investment and the restructuring of existing long term debt. Grant Thornton secured the finance through private equity funders, European Digital Partners (EDP); from Scottish Enterprise’s co-investment fund; and the Scottish Government’s regional selective assistance (RSA) scheme. More here.
Upstream Telecommunications and Software Systems S.A. (UTSS), a mobile marketing and promotion vendor, has raised growth capital investment of EUR 11 million, co-led by TLcom Capital L.L.P. based in London and by Alpha Ventures S.A. a leading private equity / venture capital firm in Greece. UTSS, which has already proved its business models via steady revenue growth (€38m in 2008) and reached profitability in its first year, had no problems in raising growth capital. Click here.
With the European Tech Tour Cleantech Summit taking place this month, Bernard Vogel, co-founder and managing partner of Endeavour Vision, a firm which focuses on cleantech and technology investments, says now is the best time ever to start a cleantech start-up. He highlights the fact that there is a lot of money to be invested by investors in cleantech start-ups, a lot of money promised to cleantech projects by government, and this is backed up with significant media attention. Vogel says “In the current economic context, cleantech and renewable energies will benefit from the stimulus packages launched in several countries. In Europe, the Commission announced on 9th March that €105bn will be invested in the green economy through the EU cohesion policy.” Click here to read more.
Regardless of the merit of Google’s acquiring YouTube for $1.65 billion, and its valuations, one must not underestimate the power of guanxi amongst the silicon valley networks. The co-founders of YouTube had all worked together in engineering at PayPal, the online card payment system provider, which was later acquired by eBay. After PayPal was sold to eBay, the PayPal alumni stayed in touch with each other. Since leaving PayPal, they have helped each other out, finding them new contacts, introducing them to their personal networks, tapping into their start-up DNA pool and learning from their previous mistakes. Click here.
Although the US economy is still in recession, small business lending by banks and other lending institutions showed moderate but positive increases in 2008, as both borrowers and lenders continue to hold off new borrowing in reaction to an uncertain economy. Small business loans (loans of less than $1 million) outstanding totalled $711.3 billion as of June 2008, this is an increase of $26.7 billion or 4.0 percent, although it is roughly half the increase of $50.6 billion recorded in 2007. Bank consolidation has produced an unusual lending behaviour from large asset (over $10 billion in asset size) institutions, which is increasing the amount of small and micro loans to SMEs as a way of diversifying default risks by big-mega companies in a weak economy. Click here to read more.
Although, monthly data from the British Bankers Association shows consistent rise in SME lending, the feedback from SMEs is that banks are cutting back and switching to more expensive products. So what is really going on? Data for March shows that lending by high street banks to SMEs rose by £271 million to reach £45,938 million. However, this figure hides the underlying pressure by Banks to switch SMEs from overdraft facilities to term lending; bankers withdrew £457m overdrafts in December 2008 alone. Although not directly impacting SMEs, foreign banks’ lending in the market has virtually collapsed. Click here to read more.
Although the overall Dutch private equity market has collapsed by half, the Dutch venture capital market is continuing to invest in seed and start-ups. Despite dire economic conditions, the total amount of seed and start-up capital invested increased to €228 million in 2008, up 66 percent from €137 million in 2007; The current economic crisis had only a limited impact, as investors assess these companies largely in terms of their long term perspective. More information here.
When you prepare your business plan or assess the opportunities for your venture, do you confuse the ‘market’ and ‘industry’? It is easy for would-be entrepreneurs to confuse the two; markets define the group of customers that may buy your products or services, and the industry is the competitor landscape within the market you are targeting. View the video from John Mullins of London Business School - click here.
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