Yahoo seeking up to $500 million for small business unit

SAN FRANCISCO/NEW YORK (Reuters) - Yahoo (YHOO.O) hopes to get up to $500 million for a unit that hosts websites for small companies, after putting it on the market for several months, two people familiar with the matter said.

Yahoo has received interest from corporate buyers and private equity firms, one of the sources familiar with the situation said. It is unclear if any party has made an offer.

But some potential corporate buyers who have looked at the asset in recent months have decided not to bid because they think the price is too high, a second source said.

"Yahoo's price expectations are higher than what buyers were willing to pay," this person said, adding that Yahoo was seeking $350 million to $500 million. "People would like to own this asset, but not at the asking price."

As part of its strategy to shed assets that are no longer core to its brand, Yahoo put the unit called Yahoo Small Business up for sale about six months ago, along with HotJobs, its online job classified site, the sources said.

Last week, Yahoo sold its stake in China's top e-commerce company Alibaba.com for $150 million.

The sources spoke on condition of anonymity because the sale process has not been made public. A Yahoo spokeswoman said the company does not comment on rumors or speculation.

The small business division provides domains, email, Web hosting and other merchant services to customers. Sunnyvale, California-based Yahoo, which posted $7.2 billion in revenue last year, does not break out the unit's performance.

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The Court and Campaign Finance

In the Supreme Court this week, Elena Kagan, the new solicitor general, eloquently defended the longstanding ban on corporate spending in political campaigns. But the conservative justices who spoke showed a disdain for both Congress’s laws and for the court’s own prior rulings. If the ban is struck down, as we fear, elections could be swamped by special-interest money.

Conservative jurists talk about judicial modesty and deferring to the elected branches. But in the questioning, Justice Antonin Scalia made clear that he considers Congress to be a self-interested actor when it writes campaign finance laws. Chief Justice John Roberts and Justice Samuel Alito seemed to put little weight on the fact that the court has repeatedly upheld a ban on corporate campaign expenditures.

What the conservatives seemed most concerned about was protecting the interests of corporations. The chief justice and Justice Scalia seemed especially perturbed that what they see as the inviolable right of these legal constructs to speak might be infringed upon.

The conservatives also seemed incredulous that vast amounts of corporate money flooding into campaigns could be seen as corrupting the system. We agree with Senator John McCain, who told reporters after the argument that he was troubled by the “extreme naïveté” some of the justices showed about the role of special-interest money in Congressional lawmaking.

The more liberal justices — including Justice Sonia Sotomayor, who was participating in her first argument — were far more sympathetic to the ban on corporate expenditures, but they have only four votes.

There is still some hope that Chief Justice Roberts may decide his affection for corporations is less important than the reputation of the Roberts court. If he does, there is a chance for a limited, and relatively undamaging, ruling that hews closely to the facts of this case.

The underlying dispute is a narrow First Amendment challenge brought by Citizens United, a nonprofit group that wanted to show an anti-Hillary Clinton movie on a video-on-demand service during the primary season. The court could uphold its right to show the movie without opening the door to a new era of political corruption.

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BUSINESS: Online training course aimed at small businesses

WASHINGTON -- The U.S. Small Business Administration launched a new online training course to help strengthen access to contracting opportunities for small businesses, including those owned by women, minorities, disadvantaged individuals and veterans.

The training course, "Recovery Act Opportunities: How to Win Federal Contracts," is part of a federal government-wide initiative announced last month.

As part of the initiative, federal agency procurement officers are participating in more than 200 events over the next several weeks to help connect small businesses with contracting opportunities.

Additionally, SBA and Commerce are expanding their outreach to contracting officials across the federal government to ensure they have the tools to meet their annual contracting goals and increase opportunities to small businesses, including those owned by veterans, women and minorities, as well as those in designated HUBZones.

As part of the outreach to small businesses, the comprehensive online course uses both audio and script to provide information about the federal marketplace, contract rules and, most importantly, how to sell to the government and where to find contract and Recovery Act opportunities.

The new training portal is a free online training course designed to assist entrepreneurs during this period of economic recovery. This self-paced, instructional guide provides an overview of the federal procurement process.

The Recovery Act Opportunities

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Big target on small business - Now !

Small-business owners are sweating this summer — and it's not necessarily because of the weather.

Many worry that a form of nationalized health care could soon become law, and that this would cost jobs.

"I give my employees health insurance but I can't afford to meet the government mandates," one owner told the National Federation of Independent Business. "I will have to eliminate several employees to reduce my payroll expense."

(NFIB is a trade organization that helps businesses).

"I don't believe we'll be able to comply. We will have to eliminate pay increases and Christmas bonuses. Full-timers will be eliminated and all staff will be part-timers, and that will likely be insufficient," another added.

"In general, H.R.3200 will hurt my business due to increasing my costs. Ultimately that may mean letting people go. How is that helping the economy or small business?" wondered a third owner.

No wonder NFIB has come out in opposition to the "reforms" proposed in the House of Representatives.

Many politicians insist they can add a government-run "public option" health insurance plan on top of the trillions of dollars in obligations our federal government is already facing. But small business owners know better.

The government plans have a big problem: The extra taxation and spending would destroy many small businesses, the very foundation of the American economy.

Half of all private workers in the U.S. are employed in firms with fewer than 500 workers. These small firms have also created somewhere between 60 and 80 percent of all new jobs in the last decade.

But some politicians are willing to endanger that growth.

Rep. Charlie Rangel, D-N.Y., chairs the crucial Ways and Means Committee. To pay for health-care "reform," he wants to slap a surtax on roughly 2 million tax filers.

Some 60 percent of these returns reflect money made by a small business or partnership.

While 400,000 of people affected by the surtax derive most of their adjusted gross income from a small business, these taxpayers already shell out one quarter of all income taxes. They represent our economic foundation.

The proposed extra tax would be on a sliding scale: 1 percent for joint filers with more than $350,000, 1.5 percent for joint filers with more than $500,000, and 5.4 percent for joint filers with more than $1 million in adjusted gross income.

In addition to higher taxes, the House health care bill would force small businesses with at least $250,000 in payroll to provide health insurance or pay a tax penalty up to 8 percent of payroll.

And as if the initial proposed tax rate wasn't high enough, there's every chance it could go up.

The House bill would empower the Office of Management and Budget to jack the tax rates up to 2 percent for those making $350,000 and 3 percent for those making less than $1 million, if bureaucrats decide that's necessary.

Businesses would have an even harder time preparing for the future, because they'll never be able to know when their taxes may increase or how high they'll eventually go. Few business owners would hire new workers under those conditions.

The national unemployment rate in July reached 9.4 percent, and of course we all want to bring that number down by creating as many jobs as possible, as quickly as possible.

To do so we need to shore up small businesses, not chip away at them with higher taxes and expensive mandates.

As summer winds down, Obamacare seems to be on life support.

Small-business owners have spoken. We ought to pull the plug, and start over again with an effective reform plan that won't hammer our nation's economy. ...Read More ! ⇒

Palo Alto: business tax foes step up campaign

Foes of a business tax ballot measure in Palo Alto are stepping up their campaign with a new "fact sheet" calling the proposal unfair.

"Measure A will create a business license tax in Palo Alto written by the city to benefit large corporations and will unfairly burden our city's small businesses," says the document, paid for by the committee Small Business Against Taxes.

The measure would charge multi-billion-dollar corporations a lower rate per employee than small businesses, it goes on. For instance, manufacturing firms would pay $34 per employee while professional service businesses would pay $95 per employee. And the city's largest corporations will pay lower rates than medium-sized businesses, it says, because of a cap on the size of the tax.

The line of attack is in keeping with the official ballot argument against the tax, which also focuses on the disparity in tax rates between large and small businesses. Both documents have the endorsement of the Palo Alto Chamber of Commerce.

The Palo Alto City Council put the tax on the Nov. 3 ballot in hopes of raising $3 million annually for the city's general fund. If approved, businesses would pay between $75 and $30,000 per year based on their line of work and number of employees, with the majority paying $200 or less. The first payments would be due in 2011.

The official ballot argument in favor of the tax says it would benefit the city's libraries, parks and schools and help
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pay for new infrastructure. It notes that Palo Alto is one of only two cities that do not have a business license tax.

A rebuttal to the argument against the tax combats the claim that the tax rates are skewed. "The tax is more than fair. It will reach lawyers, accountants, venture capitalists and other service providers who don't pay sales tax. They will pay $95 per employee, as compared to restaurants and retail outlets that will pay only $40 per employee."

Many California cities have flat fees for business licenses, while some have employee-based taxes like the one proposed in Palo Alto. Of the two models, Palo Alto's actually charges big corporations far more while charging the smallest companies less.

The tax will go into effect if more than half of the city's voters support it.

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Future Financing For Small Business Clouded, Hurting Recovery

Even as the economy improves, financing may continue to be elusive for small businesses that drive job creation in the U.S.

Battered banks have cut back on loans and lines of credit. While smaller banks and credit unions have jumped in, they don't have the capacity to fully make up the financing needs.

It's unclear how small businesses, which account for half the U.S. economy, will find the funds to invest and propel the fragile recovery.

"We have to figure out how to get to the institutions and avenues small businesses actually use," said William Dennis, senior research fellow at the National Federation of Independent Business Research Foundation.

Despite government efforts to shore up the banking system, credit remains tight. The Federal Deposit Insurance Corp. last week said loans to small firms declined 1.9% in the past year. A Federal Reserve survey showed a third of banks tightened lending to businesses in the three months ended in July.

While the recession depresses demand for funds and hurts credit quality for small businesses, lines of credit are being cut for even solid firms, say advocates.

Meanwhile, community development financial institutions, such as credit unions and microloan funds, are making more loans, and larger ones, this year compared with last, according to a Philadelphia Federal Reserve Bank report on its region.

When it comes to number of loans made under the U.S. Small Business Administration's primary loan program, National Penn Bank and Susquehanna Bank have moved up in the Philadelphia area. They rank seventh and sixth respectively in the nine months ended July, from eighth and 12th during October 2006 through September 2007. In contrast, Bank of America Corp. (BAC) in the same period has gone from ranking fifth in number of loans - 118 - to 29th, with just four loans.

"Now, we're seeing more and more credit-worthy firms that are unable to get conventional financing," said Lynn Ozer, who manages Susquehanna's government guaranteed lending. She's seeing at least double the number of applicants for the SBA program than a year ago. Susquehanna Bancshares (SUSQ), based in Lititz, Pa., has $13.8 billion in assets.

Bank of America spokeswoman Tara Burke said the bank remains committed to small business. It lent more than $8 billion to companies with less than $20 million in annual revenue and modified payment structures for 32,000 small business credit-card customers so far this year, she said.

National Penn Bancshares Inc. (NPBC), based in Boyertown, Pa., with $9.7 billion in assets, didn't return a call for comment.

Groups that help small businesses are encouraging them to try regional banks. Philadelphia's Wharton Small Business Development Center is inviting more regional banks to attend its "meet the lenders" program in November and arranging its first-ever panel discussion with regional bank presidents in December.

But while regional banks didn't delve into the securitized products that bedeviled larger banks, they have exposure to commercial real estate - the next phase of the crisis. The National Association of Realtors recently said the market may only see meaningful recovery in the second half of 2010. Regional banks facing impending losses may cut back on credit even more.

Larger companies have the ability to bypass tight bank credit - they can sell bonds to investors, who lately have shown an insatiable appetite for the attractive assets. But small businesses have no such access. A long, protracted recovery may be the result.
Source: CNN

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Domestic trade finance business doing well

PETALING JAYA: Some 80% to 90% of the world’s trade relies on trade finance, and there is little doubt the trade finance market will experience difficult times which will contribute to the global economic malaise.

However, the trade finance business in Malaysia is still doing well.
Chuang Boon Kheng ... ‘We believe our country’s exporters are unlikely to suffer any trade finance shortage.’

According to Harm Bots, Royal Bank of Scotland Bhd’s senior vice-president, country head, global transaction services, the bank has been expanding its trade finance business.

“There is a greater need for companies to open trade lines. We have been expanding our corporate business. On the other hand, the risk profile of most companies has increased,” he told StarBizWeek.

He said access to trade and supply chain financing had become more challenging with the onset of the credit crisis, especially in the emerging markets of Asia, due to a tighter credit environment.

“While it is tougher for banks to give out financing these days, big companies are also taking the cue and spreading their wings to work with a panel of banks,” he said.

Bots said the World Trade Organisation had estimated that there was a trade financing gap of US$49bil globally, “which means there is a shortfall of funds that are required but not available from banks.”

“Right now financing from banks is not as readily available. The pool of liquidity is smaller,” he said, adding that the pricing of trade finance instruments had also risen, reflecting higher funding costs, increased capital constraints and greater counter-party risks.

He said the types of trade finance products in demand had also changed as a result of the changing financial and business landscape.

“We are seeing a shift from open account trading, which was popular when the risk of trading account defaulting was considered small, to documentary trading using conventional trade finance products – such as letters of credit, bills of exchange and guarantees – to mitigate risk.

“Open account trading represents about 70% of the market and will always play a key part but, in the short term, letters of credit are becoming an increasingly popular way to mitigate risk,” he said.

In an atmosphere of constant uncertainty and volatility there was a growing need for financial service providers to take account of the end-to-end trade cycle to keep trade flowing, he added.

The International Chamber of Commerce had observed, based on global surveys, that about 70% of documents presented under letters of credit were discrepant on first presentation, he said.

“This is consistent with our own experience in Asia and Europe where we found about 70% to 80% of the documents being discrepant,” Bots said.

In this challenging, risky environment, it was crucial to manage risk and documentation, he said. “It is crucial for exporters to understand how to conduct trade and ensure that when you ship to stressed markets you get your money back.”

ABN Amro Bank N.V. executive director, regional head, business development Abraham Chacko said it was prevalent in volatile markets for suppliers to weasel out of their contract by looking for loopholes in documentation.

He said the UCP 600 was a set of rules used globally in documentary trade and detailed knowledge of this subject was key for exporters to manage risk and working capital efficiency.

“The UCP remains the most successful set of private rules for trade ever developed,” he said.

OCBC Bank (M) Bhd head of global trade finance Chuang Boon Kheng said the general exports demand continued to be weak but the bank was seeing early signs of improvement as seen in the trends of export letters of credit flows at the end of the second quarter.

“Given the resilience of the domestic banking system and existing trading relationships, we believe our country’s exporters are unlikely to suffer any trade finance shortage induced by the ongoing crisis,” she said.

The current financial crisis had had a visible impact on several fronts, such as the overall decrease in transaction value and volume, she said, but the capacity of banks to provide trade finance continued to be strong, as often reiterated by Bank Negara.

She said based on the bank’s experience, about 50% of letter of credit document submissions tended to be discrepant and this could have an impact on discrepant bills, including delays in payment, which may result in loss of interest, withholding of payment and exploitation of the discrepancies in an attempt to avoid payment or obtain discounts in the event of falling prices on the world market or currency fluctuations.

HSBC Bank Malaysia Bhd director trade and supply chain Lawrence Yong said the bank’s trade finance business was faring well, mainly due to its ability to leverage on the group’s strength in both import and export trade financing.

“Additionally, there is an increasing focus on more value-added transactions, especially in cross-border trade financing,” he said.

In such challenging times, there is increasing demand for risk mitigation products. HSBC has the strength and expertise in designing financial structures to cover all parties involved in the supply chain.

Yong said based on prevailing statistics, on a general basis for the banking industry worldwide, the percentage of documentary mistakes/discrepancies could be quite high.

“Discrepant documents in trade transactions can delay/affect the collection of payments. It is, therefore, important that the documents are compliant and free from mistakes,” he said.
Source: TheStar ...Read More ! ⇒

Seminar for small business planned - Take it !

AVON PARK - "Steps To Start A Small Business" is a free two-hour seminar presented by the Small Business Development Center at University of South Florida. It will be held from 2-4 p.m. Wednesday, Aug 26 at South Florida Community College in building T.

It is designed for persons thinking of starting a small business or who have started a business and want to make sure they did it correctly. Licenses, marketing, entity selection, and business planning are among the items discussed.

The seminar will be presented by Bill McKown, certified business analyst with the SBDC. Call McKown at 784-7379 to reserve a space in the seminar
Source: Newsun

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Starting a Business : is my Plan B

CALL them accidental entrepreneurs, unintended entrepreneurs or forced entrepreneurs. A year and a half into the Great Recession, with the jobless rate hovering near double digits, corporate refugees like Lisa Marie Grillos of San Francisco are trying to fend for themselves.

Along with her brother Hernan Barangan, Mrs. Grillos started Hambone Designs, after her full-time contract position with Williams-Sonoma as a production manager wasn’t renewed in January. The new company makes bicycle bags that hold things like keys, wallets and cellphones.

“You have the time — why not focus your energy on something, rather than just trolling Craigslist and sitting and watching TV?” Mrs. Grillos says. “It’s really taking matters in my own hands.”

Mrs. Grillos, 34, built a Web site called hambonedesigns.com, opened a virtual shop on Etsy.com, an online marketplace, and hit San Francisco street fairs. So far, between the online marketing and the street fairs, she and her brother have sold 70 bags, which retail for $20 to $40. Each sale results in a profit.

“We have been talking about mass producing, but we’re not there yet,” Mrs. Grillos says. “It is a whole other thing, approaching stores and having the inventory.”

To help make ends meet, Mrs. Grillos also does textile design and photography projects, and it helps that her husband has a full-time job.

Others among the unemployed are taking the entrepreneurial route. The most recent Index of Entrepreneurial Activity by the Kauffman Foundation showed a slight uptick of new businesses in 2008 — a full recessionary year — over 2007. An average of 320 Americans out of 100,000 formed a business each month, Kauffman said. What’s more, it found, the patterns “provide some early evidence that ‘necessity’ entrepreneurship is increasing and ‘opportunity’ entrepreneurship is decreasing.”

Accidental or by design, entrepreneurship is on the rise again this year. LegalZoom, the online legal document service, says the number of new businesses it helped to form was up 10 percent in the first half of the year, compared with the period a year earlier.

“We were surprised,” says Brian Liu, co-founder and chairman of LegalZoom. “We expected there to be a drastic downtick.”

LegalZoom’s top five areas of incorporation, he says, are real estate, consulting, Internet (including electronic commerce), retail, and construction and contractors.

To be sure, a vast majority of corporate workers who have been laid off since December 2007 have sought another corporate job. After all, starting a business in the worst downturn in decades seems especially risky. Only two-thirds of new small businesses survive at least two years, according to the Small Business Administration. That survival rate falls to 44 percent at four years, and to 31 percent at seven.

The silver lining may be that the survival rate is about the same in expansions and recessions, says Dane Stangler, senior analyst at Kauffman.

WHILE the Internet has made the formation process quick and inexpensive — papers can be filed with LegalZoom, for example, for $149 in addition to state filing fees — the costs of owning a business add up quickly. There are state and local taxes and fees, insurance, salaries and contract pay, overhead, inventory and the like. And these days, lenders are none too generous when it comes to forking over money to new businesses.

These factors, combined with the lack of a steady paycheck, often-inadequate health insurance and the sheer emotional stress of being unemployed, may prevent many people from setting out on their own.

But research on what is known as post-traumatic growth has found that some people become more resilient when faced with adversity, says Shawn Achor, a Harvard researcher. Creativity surges, he says, as they adapt to a new situation.

“Their brain is actually learning at a faster pace than when they are not challenged,” Mr. Achor says. “As a result of this, some individuals, the accidental entrepreneurs, they are the ones who in the midst of crisis actually respond with growth.”

In a report this summer on innovation, Ernst & Young wrote, “Experience shows that entrepreneurs should not give up on start-ups in a down economy.”

Many companies with billion-dollar market capitalizations were started during a recession, the report said, including Starbucks, Intuit and PetSmart.

Research from Kauffman in June found that more than half of the companies on the Fortune 500 list in 2009 and nearly half of the companies on the Inc. magazine 2008 list were founded during a recession or bear market.

Lynn Zuckerman Gray, 60, hopes to be one of the success stories of this recession. She lost her job at Lehman Brothers almost a year ago, when the firm collapsed. A former chief administrative officer of its global real estate group, she found herself competing with a rising number of job seekers for a dwindling pool of jobs.

Ms. Gray ended up participating in a New York City program, offered in conjunction with the Kauffman Foundation, called FastTrac NewVenture. The program, for employees displaced by the financial crisis, sent Ms. Gray in a direction she never thought she would go: starting an on-campus recruiting company called Campus Scout.

“I guess I had an entrepreneur simmering inside me because I’ve always been very creative,” she says.

The cost has been hundreds of dollars here and there, she says. Still, the reality of her financial situation is daunting. Her severance pay from Lehman ended this month, and she is now eating into her savings. So far, her new venture, Campus Scout, is in start-up mode and does not have any clients.

She says she is going to try to get part-time work, teach university classes and do some freelance writing to generate cash flow so she can keep her business going for at least two years.
Source: NYTIMES

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SBA to host downtown small-business fair -Thursday

The U.S. Small Business Administration will host a resource fair in downtown Denver on Thursday, Aug. 20, for those who own a business or are thinking of starting one.

The free "Small Business Resource Fair" will be held at 10:15 a.m. to 3:45 p.m. at the Denver Public Library's Central Library at Civic Center, in the level B2 conference room. The library is co-hosting the event.
No advance registration is required.

On hand will be representatives from commercial lenders, federal prime contractors, business assistance organizations, local chambers of commerce and state and federal agencies.

The fair is intended "to answer questions relating to all aspects of starting, operating and growing a business. Small business owners will also learn how they can take advantage of the various programs initiated by the American Recovery and Reinvestment Act," SBA said in a statement.

Source: Bizjournals.com ...Read More ! ⇒