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【速度】
Entrepreneurs: You're More Important Than Your Business Plan
by Rich Leimsider and Cheryl Dorsey
[attachimg=580,215]114573[/attachimg]
"Would you take a look at my business plan?"
Some member of our staff at Echoing Green, an angel investor and grantmaker in social enterprise, hears this request every week. And we are often happy to review these start-up plans — which include the typical elements such as a product description, competitive analysis, estimate of market size, and projected financials. But we are interested in much more than these traditional plans. We use other criteria to find new people and ideas that can create large-scale social change.
In short, the business plan is overrated.
Like the vast majority of start-ups, most new social enterprises are bootstrapping efforts. As Amar Bhide said in "Bootstrap Finance: The Art of Start-ups" (a 20-year-old HBR article that is an uncanny precursor to today's "lean startup" meme), traditional business planning processes are less relevant to bootstrappers — where resilience trumps planning and energy trumps experience.
Applying a formal spreadsheet-type analysis to an early stage concept can be "disastrous." Instead, we look at eight broad rules for success, half of which are about the entrepreneur herself (not her business plan). These are lessons we've learned from investing $30 million over the last 25 years in 500+ social start-ups about what make a promising social entrepreneur, but they are equally applicable to any entrepreneur.
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Purpose and Passion. Do they care deeply about this issue or community? Do we understand why? In 2012 Echoing Green invested in 28-year-old Marquis Taylor as one of our Open Society Black Male Achievement Fellows. Marquis created an organization called Coaching For Change to engage young Black men as entrepreneurs pursuing business opportunities related to basketball, football, and other sports. His passion was evident from his initial application — as the child of a single mother in South Central Los Angeles, basketball was his ticket to college. But he also understood that while a career as a professional athlete was extremely unlikely, sports itself was a multi-billion dollar industry with great opportunity as coaches, trainers, even youth camp organizers.
Perspective and Resilience. Will this person bounce back from the obstacles they will surely face in building this business? According to official statistics, more than 50% of new enterprises fail in the first 5 years. But in our experience 100% of new entrepreneurs face partial failure regularly. Even when a particular challenge doesn't end the business immediately, the ability to bounce back is crucial. Although this is Marquis' first entrepreneurial endeavor, his journey from academically struggling high school student to graduate student at Smith College demonstrated the grit and tenacity to consistently overcome obstacles.
Point of Entry and Leadership. Can you envision this person entering a field in a transformative way and inspiring others to action? All leaders must demonstrate authenticity and legitimacy with their customer base and other stakeholders. Marquis is building his organization in Massachusetts, a far cry from the Los Angeles of his youth. But his authentic presence and open attitude have given him access to the insular industry and geography where he now works.
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Power Source and Resource Magnetism. Can this person attract money, people, and other resources to their cause? At Echoing Green we've learned that more important than charisma is what we call resource magnetism. Whether or not the entrepreneur has a thousand-watt smile (and it just so happens that Marquis does!) it is much more important that she is able to quietly persuade people around her to volunteer their time, talent, and treasure. Somehow Marquis is able to use the most tenuous of connections to arrange a conversation with a busy but influential leader, and then walk out with a financial commitment or five more introductions.
Even the most entrepreneurial leader, of course, needs a great idea. Here are our four rules we use to evaluate the underlying business concept:
Innovation. Has it been tried this way before? There are hundreds of organizations that use athletics as a way of engaging low-income teenagers. But too many of these organizations fail young people by neglecting to make the connection between athletic success and professional success. Marquis found a way to do this. Coaching For Change asks young people to build their own businesses around youth clinics, summer sports camps, and coaching. The kids develop discipline and focus, but also practical, marketable skills.
Importance. Does this organization tackle an issue that matters in the world? Our Fellows must not only have a clever idea — they need to tackle one of society's major pain points. Marquis reminds us that nearly half of all young black men who start high school will not graduate. His work matters.
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Potential for Big, Bold Impact. Could this organization directly, or by example, change a big system? Truly great organizations don't merely grow, they also influence their field. Marquis is ambitious and he hopes Coaching for Change will work with as many young people as possible. But reaching scale through copycat businesses is just fine and if Marquis can demonstrate the viability of his model, we believe it will be adopted more broadly and faster than Coaching for Change can spread it.
A Good Business Plan. Does the start-up plan (budget, timeline, staffing, etc.) seem thoughtful? Of course, the business plan remains an important element and we don't neglect to look at it. While Marquis' plan today is well-structured, the truth is that when we met him it was not the strongest part of his overall presentation. But we invested in him because we believe that helping an early-stage entrepreneur articulate a detailed plan is one of the ways that risk-tolerant investors can be most helpful.
Coaching for Change is by no means an established success. And even the most promising social enterprise take wrong turns. We are proud to have made early investments in the work of Andrew Youn, who founded One Acre Fund; Wendy Kopp, who founded Teach for America; and Vikram Akula, who founded SKS Microfinance. Each has led their start-up to massive impact for hundreds of thousands of people and influenced the way resources are deployed in their fields. But we're equally proud of Angel Taveras, whose Echoing Green-funded mentoring program never reached scale, but who now pursues social change as the Mayor of Providence, Rhode Island. So while we know that Marquis Taylor meets our eight criteria and has a better than average chance of success, we're still buckled in for what might be a bumpy ride.
The point is that a business planning process can be extremely valuable to an entrepreneur. But if we're going to truly see change through entrepreneurship, we have to focus on the person first and the business plan second.
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【计时三】
Interest rate predictions make long-term Treasurys look bad
by Allan Sloan
You have to love the Congressional Budget Office. In an era where spin has largely replaced substance in what passes for discourse in Washington, the nonpartisan CBO calls things as it sees them, regardless of the positions taken by other arms of the government.
Take the CBO’s interest rate projections, for example. If the numbers in the CBO’s recent semiannual budget update prove accurate, it means that there are at most only two years left of the Federal Reserve keeping interest rates ultra-low. The Fed has declined to provide a timetable for rates rising, but the CBO has indirectly given us one that has major implications.
Last month, I wrote that the Fed’s ultra-low-rate policies helped touch off what I called a behind-the-scenes currency war. It’s now become a public war, with many of our major trade partners trying to depress their currencies to stay competitive with us and with each other. If the CBO is right, the war could be coming to an end reasonably soon, which would be a good thing.
The CBO isn’t in the investment advisory business, but its interest rate projections are a clear warning to any yield-hungry investor tempted to buy the 10-year U.S. Treasury note, which currently yields about 2 percent. The rationale for buying this security is that 2 percent isn’t much, but it’s better than zero, the approximate rate you get from money market funds and short-term bank accounts these days.
But look out. If the CBO is right, you would be better off hiding your money under your mattress for the next two or three years than using it to buy a 10-year Treasury note today.
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【计时四】
Think that’s crazy? Let me show you the numbers.
The CBO is predicting that 10-year Treasury notes — which, remember, are currently yielding 2 percent — will yield 3.2 percent in 2015, which is two years from now, and 4.1 percent in 2016.
Now, for the math. If you buy a 10-year Treasury today at face value, the interest you receive over its life will total 20 percent of what you put up: 2 percent a year for 10 years. But if the yield is 3.2 percent two years from now, you would be better off doing nothing for two years, buying the note at well below face value, and collecting 3.2 percent for eight years. That would produce 25.6 percent over eight years (8 times 3.2), a heckuva lot better than 20 percent over 10 years.
If the CBO is right and you wait three years to buy the note — at a steep discount — you would collect 4.1 percent for seven years, or a total of 28.7 percent on your money.
Unlike stock prices, which are often ruled by emotion, market prices of Treasury debt securities are ruled strictly by arithmetic. Consult a handy-dandy bond calculator like the one posted at SmartMoney.com and you’ll see that if you pay 100 cents on the dollar for a 10-year, 2 percent Treasury today and yields rise to 3.2 percent in two years, your note would be selling at only 91.65 percent of face value. In other words, your capital loss would more than offset the interest you had already collected, plus two more years worth. Your choice would be to take the loss all at once by selling, or take it over time by collecting only 2 percent while other investors are collecting 3.2 percent.
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If rates are 4 percent three years from now, the now-seven-year note would sell at 88, wiping out six years of interest.
I’m not telling you that the CBO is right about interest rates. But if it’s even remotely right, the investment world will be a lot different in two or three years than it is now. By then, the currency wars may be a fading memory. And the people who put heavy money into long-term Treasury securities will be asking themselves that painful question: What was I thinking?
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【计时五】
Independent Work May Be Inevitable
by Whitney Johnson
I never intended to disrupt my career over and again, eventually becoming a free agent. And yet it turns out that the odds were pretty good that I would disrupt myself out of corporate life — and that you might, too.
My decision to go independent was set in motion over a decade ago. When my husband was on the hunt for an academic job after completing his PhD, his choices were Boston and San Antonio, both of which had the potential to cut my Wall Street career short. Because of my Institutional Investor ranking, and advances in technology that made virtual co-location possible, I was able to persuade Merrill Lynch to let me work out of my home in Boston. When I left Merrill in 2005, most people didn't know I had been working remotely for four years; my standing as an analyst had actually improved during that time.
The recent global downturn has accelerated the growing trend toward some type of independent work. Of course, this state of 'independence' isn't always of our own accord. Layoffs are rife. Productivity gains are not necessarily leading to job creation. Even so, approximately 43 million people, or roughly 35%-40% of the private workforce in the U.S., are currently doing some type of contingent work; this number is expected to grow to 65-70 million within the decade, well ahead of the 1% rate at which the labor force is growing.
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Drilling down further, according to MBO Partners' State of Independence in America report, there is a rapidly growing subset of "independents" in the U.S., which MBO defines as an individual working 15+ hours per week whether as a freelancer, contractor, or owner of a micro-business. Stripping out the c. 25 million people who are working part-time and are potentially under-employed, MBO calculates there are currently about 17 million independents. This number is expected to increase to 23 million by 2017, based on a 6.3% per year growth rate, 6x the rate of growth of the workforce. And that could easily swell to over 30+ million in the next decade as large and small corporations, as well as the government, continue to migrate to contingent labor, and account for 50% of the workforce, up from 35-40% currently.
Where it gets interesting, though, is that independence isn't necessarily being foisted on people. Of those who went independent in 2012, 57% chose to. Even more telling, whether these independents pursued this path of their own accord or not, only 13% intend to go back to traditional employment. Certainly that has been the case for me. After leaving Merrill Lynch, I co-founded Rose Park Advisors with Clay Christensen, veering ever closer to independence. A start-up environment may be grueling, but you are more your own woman — or man.
This trend cuts across all demographics. Millennials (Gen Y), ages 21-32, for example, 40% say they're likely to choose independence of their own accord. 58% of Boomers (ages 50-66), are choosing independence. And Gen X (33-49) is the most likely to choose independence — 68% of those who have gone indie are there by choice rather than the result of job scarcity or loss. You can see this growing appetite for autonomy reflected in the burgeoning number of books and blogs looking at the meaning of work and life, from Umair Haque to Cali Yost to Gretchen Rubin to James Altucher.
The allure of "the company man" has all but faded, a quaint relic. Gone are the days when many of my friends' parents worked at IBM's famed Almaden IBM Labs. The job security, pension, the health benefits that a company lifer of my parents' generation could expect simply do not exist. Meanwhile, the stigma of working on one's own has all but vanished. Is it really any surprise that when I left Rose Park in 2012, I didn't run back into the arms of a large corporation, instead moving even further toward a totally independent and flexible role?
Don't mistake me. As I have moved into the role of a fully-fledged independent — writing, speaking, and advising — I am frequently terrified. A more abstract identity, rollercoaster cash flow, punctuated by entrepreneurial missteps: the P/E (puke to excitement) ratio, as Isis CEO Heather Coughlin, and fellow disruptor describes it, can become uncomfortably high, even for an adrenaline junkie like me. But alas, disruptor valuations are sometimes tough to stomach. The growth opportunity isn't easily quantified, making valuation appear demanding for a time.
Note too, that with personal disruption, success is self-reported satisfaction, however you may define it. According to MBO, 65% of respondents reporting being highly satisfied versus 47% for those in traditional employment. I'm finding that to be the case for me. Notwithstanding the fear I occasionally feel, most days I have to pinch myself I am so happy: I get to work where I want, on what I want and with whom. I'm still working just as hard to get the brass ring, but truly I am having fun doing it. Getting paid depends almost wholly on my merits, not politics. And now more than ever, I know my family.
The disruptions that are changing the landscape of American working life have been a minefield for so many. But they are also making a new level of work-life flexibility possible that didn't exist previously. Perhaps you'll choose the course of independent employment. Maybe your hand will be forced. Either way, letting work freedom ring is changing the American dream, hinting at the expanse of a frontier on the other side of the industrial revolution. One where disruption isn't just about financial returns, but the glee of harnessing a new learning curve. Where people not only put food on the table, but also have a life.
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【越障】
The False Promise of Free Capital Flows
by Jonathan Schlefer
The economic orthodoxy that swept the world in the 1990s and 2000s attests to the terrifying power of ideas. Economists built "general equilibrium" models that, underneath all the fancy math, just assumed markets are stable and optimal. The models concluded — in a sort of "divine coincidence," as the MIT economist Olivier Blanchard and a colleague quipped — that if central banks merely maintained steady, low inflation, they would achieve economic stability and the best growth possible. Washington and London espoused this orthodoxy. The Treaty on European Union practically inscribed it in law.
In the Wake of the Crisis: Leading Economists Reassess Economic Policy collects essays by economists who are, indeed, leading — and are reassessing that orthodoxy. Never quite a true believer in it, Blanchard, now chief economist of the International Monetary Fund (IMF), acknowledges the terrible damage it caused. The macroeconomist David Romer concedes that the performance of pre-crisis state-of-the art models — some of which he developed — was "dismal." The editors frankly admit they have no clear idea how to replace them.
However, major Asian and Latin American nations offer pragmatic financial and economic guidance. Policymakers there deferred to orthodoxy in their words but not in their deeds — and avoided crisis. None of those nations' principal banks got in trouble, and growth there suffered far less than in the advanced nations. In fact, it wasn't a global financial crisis; it was a North Atlantic financial crisis.
Global financial flows had for several decades helped drive cycles of boom and bust in the developing world. Whenever central banks lowered interest rates in advanced nations, capital ran to higher returns in emerging economies, Rakesh Mohan, former deputy governor of the Reserve Bank of India, writes in the book. Borrowing in those nations surged, economies boomed, government coffers swelled. Until the crash and the flight of money. Local politicians were not quite innocent, either. The same ones who lambasted finance as it headed for the borders during crises had often hailed plata dulce, "sweet silver" as the Argentines call it, when it had poured in fueling the good times.
This picture looks remarkably like the 2000s in the advanced nations, as torrents of money from China and elsewhere inflated the U.S. housing bubble, and torrents of money from core Europe inflated housing bubbles and wasteful public spending in peripheral Europe. We too loved plata dulce, until we hated it.
If footloose finance is the problem, Mohan and several other authors recommend using "capital controls," albeit cautiously, to limit its flows. The 1944 Bretton Woods treaty establishing the IMF gave nations the right to use such controls — and still does. The House of Lords would have killed the treaty had John Maynard Keynes not promised that Britain could manage its own economy "without interference from the ebb and flow of international capital movement or flights of hot money."
As market orthodoxy began gaining credence in the 1980s, "capital controls" became a dirty phrase in the IMF lexicon. Policymakers were supposed to control inflation and let capital markets work their magic. A move in the 1990s to ban capital controls failed when the conflagration of the Asia Crisis cast a lurid glow on it. Last November, the IMF officially retreated from blanket condemnation of capital controls.
The orthodox view was that free capital flows allowed a more efficient allocation of resources, as finance flowed into investment-starved developing nations to pay for plant and equipment. In fact, finance generally did just the opposite in the 1990s and 2000s, flowing from those nations to credit-hungry U.S. consumers. Mohan reports that fewer than a quarter of all studies on opening financial flows find that it raises growth, and those few find small benefits.
Another argument against capital controls is that they're evaded — a little like arguing that shoplifting should be legalized because people shoplift. But José Antonio Ocampo, former finance minister of Colombia, writes that the major studies, notably a 2000 IMF study, find that capital controls can limit short-term flows and help manage interest rates, as Keynes promised. (Nobody wants to limit long-term investment in plant and equipment.) Ocampo concedes that controls are "speed bumps rather than permanent restrictions because market agents learn how to avoid them." His conclusion is not to drop them but to dynamically close loopholes to keep them effective — just as with any other financial regulation.
A final argument against capital controls is that if only the financial sector were more developed, they would be unnecessary. The United States provides the obvious rebuttal: finance pouring into the most financially sophisticated economy in the world helped inflate the housing bubble. Y. V. Reddy, former governor of the Reserve Bank of India, argues that a moderate level of financial development enables "growth with stability," but an oversophisticated sector just inflates consumption.
Alongside exercising some management over financial flows, developing-nation policymakers also instituted "prudential" financial regulations that had become unpopular in advanced nations, such as prohibiting excessive bank leverage. The Reserve Bank of India even adapted standard drug-regulation procedures to the financial sector: "If the [financial] innovation's benefits do not convince the regulator of its safety, then it will not be permitted or permitted only with conditions," writes Reddy.
Likewise, contrary to the orthodox injunction to just focus on inflation and let financial markets be, and contrary to what Mexico was often said to be doing, former Mexican Finance Minister Guillermo Ortiz notes that developing nations piled up foreign reserves to help cushion capital flows. He says they intervened to avert violent swings in the value of their currencies "before, during, and after the crisis." And their reserves did help cushion capital flight after Lehman Brothers' collapse, adds Mohan.
Because of free capital flows in the Eurozone, when Spain boosted government spending in 2009 to counter recession, it just racked up debt. But with ability to moderate capital flows, Indonesian Finance Minister Sri Mulyani Indrawati says fiscal expansion (a policy supported by Romer) was "critical" in helping soften the crisis. Indonesia's 2009 budget even allowed spending increases if the crisis deteriorated unexpectedly.
These suggestions are just that. Regulators must recognize their limitations. The state of the art offers no guarantees. Alas, advanced nations may not have learned their lesson. Mohan quotes an appalling piece of hubris from the usually more sensible Fed Chairman Ben Bernanke. Admitting that financial flows can cause "devastating results." he still urges not limiting them: "The ultimate objective should be to be able to manage even very large flows of domestic and international capital."
Please, Professor Bernanke, don't try that idea in practice. Make it a research project on your return to Princeton.
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发表于 2013-2-21 20:42:38
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urpose and passion","pespective and resilience",and "point of entry and leadership" are three rules of success, which are about the entrepreneur herself. And the author tells us the importance of these rules.