Internet Entrepreneurship

I found Widgetbox through a Google search for cool websites.  Cool it is.  Widgetbox allows anyone, even non-programmers like myself, to easily transform content ideas into engaging, dynamic content that can be used on almost any website.  Many widgets are already created for access, but you can also create your own.  I’m still just playing with it, but the ease of use is sweet!  The point: check out Widgetbox for yourself.

Kiva.org, a “peer-to-peer online microlending nonprofit organization,” is successful largely because of the organization’s ability to humanize the lending experience.  Kiva’s Field Partners lend to and profile aspiring entrepreneurs, including photographs and stories in the entrepreneur’s profile.  Lenders, members of the general public, browse Kiva, select an entrepreneur’s profile, and lend funds via PayPal or a credit card.  Kiva provides the funding to the Field Partners, who eventually are repaid by the borrowing entrepreneurs, and the money works its way back up the chain.  This brief synopsis of the business model begs the question, “why then does Kiva work?  Couldn’t traditional lending methods handle this better?”

The answer is the humanization factor.  It is far easier to secure money from lenders when the lenders can directly observe the impact of their financing generosity.  Factors that might inhibit funding in a traditional lending system do not impact Kiva’s business model in the same way.  Kiva is filling a niche and creating value in a global economy, and, therefore, ought to continue to grow and experience success in the foreseeable future.

Kiva seems to be doing great things for entrepreneurs, but is it all a scam? Some say that Kiva works with a for-profit company that takes 23% interest from your investments. None of these sources are 100% credible.  Kiva is not that transparent about it either. When you are doing a great thing like Kiva is currently doing, you have to expect someone online to spread rumors and take you down. If you search “Is Kiva a scam?” on Google, you will see a mixed bag of opinions and no solid facts. After having read testimonies, and scanned over “evidence” of Kiva being a scam, I came to the conclusion, that scam or not, Kiva is still doing great things with its ability to bring money to where it is needed most. Testimonies stated that mostly all investments are returned on time, and leave both parties very satisfied for helping and being helped.

For the current fiscal year, the United States Federal Government’s budget is operating at a $1,200,000,000,000 deficit (that’s $1.2 trillion for the numerically challenged). Almost 1/3 of all federal expenditures are being paid for with borrowed money. The total debt incurred by the United States in the last 10 years currently sits at $12.3 trillion (+/- a few billion…what’s a few billion dollars amongst friends anyway?).  That figure does not include the $41 trillion liability that is on the books for Social Security and Medicaid. Nor does it include the $5 trillion in debt that is held by government-backed companies such as Fannie Mae and Freddie Mac. When you add it all together, it becomes apparent that the actual national debt is somewhere in the neighborhood of $55-60 trillion (and that figure is growing fast).

What can be done to get the $60 trillion dollar elephant out of the room? I propose four options:

1. Reduce Expenditures and Pay It Back – This is what Andrew Jackson did in the 1830s. This is also what many European countries, such as Ireland, Turkey and the Netherlands, are doing currently. However, with Obama’s Health Care bill biding it’s time in Congressional limbo, it does not seem likely that the size of the Federal government will be decreasing anytime soon. The option of paying it back is very unpopular because individuals would be unjustly forced to pay taxes on goods and services that they a) did not want and b) did not receive. Also, this option will cut most government welfare programs, which will be unpopular amongst those who have made a living by leeching off the state.

2. Repudiate- Refuse to pay the debt back. This is what Argentina does every twenty years or so. This option is the most laissez-faire and will result in the least amount of future economic pain. This will also prevent the U.S. treasury from borrowing massive amounts of deb any time soon. However, the global financial markets will probably melt down due to the United State’s large role in the global economy (the global financial markets are resilient though, and they will probably bounce back quicker than expected ).

3. Hidden Repudiation – Monetize the debt and have the Federal Reserve print money to pay back creditors. This is what the Weimar Republic did in the 1920s. This is what happened in Zimbabwe in the early 2000s. Both situations saw extreme hyperinflation that led to the collapse of their respective economies. Also, this will likely devalue the dollar to a point that it will no longer a legitimate form of currency. Economically, this the most harmful option.

4. Do Nothing and Jump On the Government’s Gravy Train – Just relax and let the politicians handle it. They know more than we do and are working in our best interests right?…right? Let them increase the size of the government and let’s hop on the bandwagon before everyone else does. Surely, Big Brother is the solution to our problems, not the cause…

Ever find yourself bored and wanting something to do.. well why not stumble. Stumbleupon is a site that brings up sites from all over the web. All you have to do is go to stumbleupon.com and fill out the form that asks for interests. This insures that the sites being generated are in your field of interest. If you love business or entrepreneurship check it out and let it know that you are interested in business.. see what comes up. You may come across different innovative business models or maybe just a blog about how to start a fruit stand on the side of the road. Either way, stumbleupon can be not only a way to waste free time, but also a way to learn more about business and help to innovate your business if you have one.

The microfinance institution Kiva will be celebrating it’s fifth birthday this coming October.  Kiva is a nonprofit organization based out of San Francisco whose aim is to provide funding for  up and coming entrepreneurs in search of capital. More and more entrepreneurs have been turning to  Kiva as a last-ditch effort to obtain financing becuase most, if not all, commercial banks are unwilling to make high risk loans, due to the current economy, to start-up projects. Kiva has been criticized lately due to the high interest rates that are being charged by the site’s lenders, known as ‘Field Partners.’ This is not surprising though, considering that most venture capitalists must inherently lend at an usually high rate to offset risk. Also, the increase in demand for funding by  entreprenerus on Kiva has forced Field Partners to lend funds at premium rates. While interest rates for each individual project are not publicly disclosed, Kiva’s website reported that the average interest rate for loans was 35.21% as of January 2010.

More information on Kiva’s Interest Rates is available here.

Ever wanted to take a youtube video and turn it into an MP3?? Well now you can with a beta program called Dirpy. With Dirpy you search videos just as you would when on youtube and it brings them up. Then you select the desired video. Once to the videos page, you can continue to select the duration, name, and file location of the video selected. One neat thing about this is that with sound files such as someone talking or something other than music, you can just upload to youtube and then Dirpy it into an MP3! Voila! Check it out…

Not too long ago, Eric Schmidt became the CEO of Google. He is a great role model for any internet entrepreneur. Here I have summarized some important take-aways  from his leadership style and some relevant facts.

1- His salary=$1. Thats not a typo. I didnt forget to add any zeros. He makes a one dollar salary, which shows his complete commitment to leading Google unselfishly, making sure all the resources are going to where they need to be. Everyone is dispensable, including himself.

2- There is a higher power. Schmidt realizes that Google is bigger than himself or any individual making it. So he doesnt actually run Google despite what his position tells him. Google is run by the culture.

3- Idea generation- Google needs to stay innovative to stay on top. They have a communication structure set up so that people can freely express their creative ideas for implementation. This flat organization even has a good chuck of money set aside just to look for crazy ideas, and do things that keep the employees passionate. People will be more motivated to work if they are the ones choosing what to work on.

If you have no morals and you like dealing with the law, then spamming can be a quick route to that money you deserve. Huge spammers make millions but also face millions in fines. Many spammers come out on top and there are thousands of people making 100k salaries from adding spam to the internet. No wonder there is so much spam online. I think if many people were presented with a 300k salary, they would stop caring about the difference between black and white hats. Its amazing how much people hate spam, and it can be seen in the incredibly pathetic conversion rates. One study has shown that they only get one response per 12 million messages. If you would like to know more and eventually become a spammer, check out these links.

http://www.digitaltrends.com/computing/how-do-spammers-make-money/

http://blogs.msdn.com/tzink/archive/2008/08/28/how-much-do-spammers-actually-make.aspx

http://www.circleid.com/posts/how_much_money_do_spammers_make/

A new craze has swept the globe.. COUCH SURFING! Couch Surfing is a forum for those who want to travel for free and want to network and learn new cultures while doing it. On Couchsurfing.org you can set up a profile of where you live, your interests, and whether or not you have a couch to spare. Other people can go on and search for places that they are traveling and find a profile of someone living there. They can then proceed to contact them in order to stay at their place. One of the largest stresses of traveling is money and this new idea takes away the issue of having to dish out anywhere from 60-200$ per night to stay at a hotel. Sorry hotels… So, if you are traveling and on a dime, check out Couch Surfing.. You won’t regret it!

Be like this dude and Couch Surf!