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Best and worst states for business ranked

Tuesday, May 7th, 2013

TexasFor the ninth year in a row, CEOs rate Texas as the #1 state in which to do business, according to Chief Executive magazine’s annual Best & Worst States Survey, released today. Florida, North Carolina, Tennessee and Indiana also made the top five.

The results may alleviate some fears in North Carolina, where other such evaluations have not placed the state as high as in previous years.

The states rated worst for business are California, New York, Illinois, Massachusetts and New Jersey.

It’s interesting that states with powerhouse venture capital sources and nation-leading business sectors such as California, Massachusetts, and New York top the list of worst states for business in these polls time after time. Makes you wonder just what these business-friendly state rankings really mean.

Best 5 States for Business Rank 2013
Texas 1st
Florida 2nd
North Carolina 3rd
Tennessee 4th
Indiana 5th

 

Worst 5 States for Business Rank 2013
California 50th
New York 49th
Illinois 48th
Massachusetts 47th
New Jersey 46th

 

The Best & Worst States Survey measures the sentiments of CEOs on a range of issues, including regulations, tax policies, workforce quality, educational resources, quality of living and infrastructure.  For the 2013 survey, 736 CEOs from across the country evaluated the states between Jan. 16 and Feb. 14, 2013.

Ohio was the biggest gainer in this year’s survey, rising 13 spots from #35 to #22. “Ohio is doing some amazing things to attract and support a pro-business environment,” said Don Taylor , CEO of Fairlawn, Ohio-based Welty Building Company. The biggest loser was Delaware, which dropped 13 spots to #27.

California hostile to business?

CEOs say California’s poor ranking is the result of a perceived hostility to business, high state taxes and onerous regulations, all of which drive investment, companies and jobs to other states. According to the California Manufacturers & Technology Association,California accounts for 12.6% of total U.S. GDP, but only has a 2.2% share of investments in new and expanding manufacturing sites.

“When you investigate acquiring businesses in some of the states rated poorly for business conditions, the anecdotes all wind up being true,” said Kevin Hawkesworth , President & CEO of Florida-based Shaw Development. “The horror stories about these states are real.”

“California, Illinois and New York are simply awful states to operate facilities or employ people,” according to another CEO. “We will do almost anything possible to minimize our exposure to these anti-business environments.”

Piles of regulations a problem

“Thank you, California!” responded one Texas-based CEO facetiously. “Keep applying pressure on your job creators and we will keep welcoming their moves to Texas.”

A common theme among CEOs is the burden of constantly changing regulations. “Business is too hard without dealing with piles of regulations that are constantly changing,” said Rick Waechter , CEO of Boston Magazine. “I believe there have to be controls, but keep them simple and straightforward—and most importantly, don’t make it a moving target.”

“CEOs continue to tell us that California seems to be doing everything possible to drive business from the state. Texas Governor Rick Perry , by contrast, personally makes it his mission to lead corporate recruitment and economic development efforts in his state,” saidJ.P. Donlon , Editor-in-Chief of Chief Executive magazine and ChiefExecutive.net.

Playbook for success

“The playbook for successful states boils down to three simple moves: engage in real dialogue with business leaders, adapt policies to create an attractive environment, and effectively communicate your story to real job creators,” said Marshall Cooper , CEO of Chief Executive magazine and ChiefExecutive.net. “This year’s rankings prove that smart policies result in increased investments, jobs and greater overall economic activity.”

2013 Biggest Gainers Positions Gained
Ohio +13
Minnesota +6
Alabama +5
Arizona +4
Kansas +4
2013 Biggest Losers Positions Lost
Delaware -13
Mississippi -8
Missouri -7
Kentucky -4
Wyoming -4

For complete results, including individual state rankings on multiple criteria, CEO comments, methodology and more, please visitChiefExecutive.net.

N. Kentucky UpTech II offers $50K in equity to selected startups

Friday, April 26th, 2013

UpTechUpTech, Northern Kentucky’s super business accelerator has opened the application process for UpTech II and seeks startups who will receive $50,000 in equity as part of the program.

Launched in 2012, the intense, six-month accelerator program is designed to attract and accelerate entrepreneurs who have the next big idea to make the world a better place.

As Tri-ED, Vision 2015 and Northern Kentucky University (NKU) continue their effort to build an informatics industry in Northern Kentucky, NKU will continue to support the community’s business start-up effort that began in UpTech I.

Working with N. Kentucky U

UpTech will work with Northern Kentucky University to engage faculty-guided students who will use their talents to support selected UpTech company projects.

”This will include student developers from the Center for Applied Informatics as well as students drawn from several programs in the College of Informatics and College of Business, helping these early stage UpTech companies build a business from the ground up.

Additionally, UpTech will provide each business with an equity investment of $50,000, six months of free, premium office space, an executive mentor, along with a dedicated team of essential business professionals providing financial, law, accounting, sales and marketing/public relations support. Additional follow-on funds will be awarded to successful companies after the program has concluded.

Informatics is the “sweet spot”

“UpTech’s ‘sweet spot’ is the Informatics sector but we are interested in investing in BIG IDEAS that disrupt the way we do business or see the world. We are excited to launch our second round,” said Amanda Greenwell, Program Manager. “Interested applicants are invited to participate in one of our webinar events for additional information about our program and the application process.”

Prospective applicants can register for the webinar sessions by visiting www.uptechideas.org.

Sessions will be held at noon EDT on the following days:
Tuesday, April 30th
Thursday, May 2nd
Tuesday, May 7th
Friday, May 10th
Tuesday May 14th
Thursday, May 16th
Monday, May 20th
Wednesday, May 22nd
Thursday, May 23rd

More information on applying for UpTech II can be also found on the UpTech website at www.uptechideas.org. The first round applications will be due by May 24, 2013 with UpTech II companies announced in July 2013.

Five reasons you should attend SEVC 2013

Thursday, February 21st, 2013

SEVC 2013Need a reason why you should attend the Seventh Annual Southeast Venture Conference in Charlotte, NC, March 13-14? Here’s five:

First, you’ll make connections with the region’s top technology entrepreneurs and executives.

More than 50 presenting companies and hundreds of high growth company C-suite execs attending, you’ll have an unsurpassed opportunity to build partnerships and hear about the latest startup trends.

Second, you’ll have an unparalleled opportunity to network with investors and venture firms from throughout the United States, not just regional firms.

Whether you’re in venture fundraising mode or an investor looking to further relationships with fellow investors for deal flow, SEVC is the vehicle to make those connections.

We’ve interviewed several of the participating venture capitalists at the TechJournal, with more to come. Here’s a sample:

 

Brian Rich

Brian Rich, managing director, co-founder, Catalyst Ventures.He’s participating in the Southeast Venture Conference in Charlotte, NC, March 13-14.

How to pitch a venture capitalist (interview with Brian Rich of Catalyst Ventures).

SecondMarket turns dead equity into productive equity (interview with SecondMarket’s Matt Shapiro).

The bar is higher for startups seeking first round financing (interview with Intel Capital’s East Coast Director, Mark Rostick).

Will there be an app economy in five years? (interview with Ron Shah of the Stripes Group).

Seven lessons from the dark side (interview with Grotech’s Don Rainey).

What does it take to build a startup to successful IPO? (interview with Bob Hower, general partner at Advanced Technology Ventures).

Also see: Startups aim to put Charlotte on the map (Charlotte Observer story focused on Terry Cox, founder and CEO of BIG (Business Innovation Growth) in Charlotte. It includes background on how Charlotte was chosen to host the event.

And three more reasons SEVC can kick up your chances for success:

Sevc12_pics

 

3. You’ll gain market insight and success strategies from innovation and technology community’s brightest starts.

From the CEO of SAP to the Publisher of Forbes - SEVC will feature over 40 speakers discussing the latest trends, best practices and strategies relating to technology and entrepreneurial growth. You’ll learn from them not just during roundtable discussions, but in one on one situations through hours of networking.

SEVC

The Southeast Venture Conference is headed to Charlotte, NC, in March 2013. The event offers firms a chance to present to top national venture capitalists and angel investors.

Panel & Presentation topics include:

  • State of Venture Capital
  • Early Stage Fundraising
  • Value Creation: Company/Investor Relationship
  • Growth Stage Funding
  • M&A Outlook and Strategies
  • LP Viewpoint
  • SaaS Investment Trends
  • Getting to Market
  • IPO & Secondary Market Outlook
  • Entrepreneur’s Roundtable
  • International Health Care Trends

4. To make networking and private meetings even easier, there is an online pre-event networking platform for attendees. 

At SEVC, the online networking platform allows attendees to connect with one another prior, during and after the conference. Attendees can see other attendee’s interests, request and setup meetings and connect helping to maximize the lasting connections you’ll make at this year’s conference.

5. Even more CXO and Venture Partner networking to create relationships that can last your entire career.

Networking is center stage at SEVC. Over one and a half days there are 3 separate open bar networking receptions, a networking breakfast, lunch networking and 7 additional networking breaks.

The event sells out, so it’s a good idea to Register today.

 

Need funding? SEVC seeks presenting companies for March event

Tuesday, January 8th, 2013
SEVC

The Southeast Venture Conference is headed to Charlotte, NC, in March 2013. The event offers firms a chance to present to top national venture capitalists and angel investors.

If you’re a high growth innovative company looking for funding, you still have a chance to present your business plan in front of top national venture capitalists and private equity professionals at the 2013 Southeast Venture Conference March 13th and 14th at the Ritz-Carlton in Charlotte, NC.

Applications to present at the event are still being accepted.

The event seeks  high growth, innovative companies from diverse technology industries including Software-as-a-Service, New Media, Bio-IT, Clean-Tech, Medical Devices, Mobile, Security, among others.

You’ll meet  hundreds of the region’s leading entrepreneurs and high growth company executives (from startups to pre-IPO), National Venture Capitalists and Private Equity Professionals, M&A facilitators and other leading professionals serving the high growth technology community.

SEVC highlights both early and later stage investment opportunities from: Alabama, Florida, Georgia, Kentucky, Maryland, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, West Virginia and Washington DC.

Last year’s SEVC Average Presenter Profile:

  • Average Annual Revenue: $5.9 million
  • Average Capital Raised to Date: $6.7 million
  • Average Number of Employees: 35

While the presenting companies are from the Southeast and Mid-Atlantic regions, the investors fly in from all parts of the country, including California, New York, and Massachusetts, as well as those that are regionally focused.

Exclusive panels, speakers, programming

The SEVC features market relevant investor and executive panels, exclusive networking opportunities, featured speakers and dozens of the region’s top private technology firms presenting to a national audience of venture capitalists, investment bankers and private equity investors.

As a TechMedia company and sponsor of the event, the TechJournal has reported on many firms that subsequently landed angel or venture backing. Venture capitalists tell us, they find new firms to put on their radar and track at each year’s event and many have returned year after year to spot hot Southeast opportunities.

SEVC is also an unparalleled networking event in which innovative firms meet potential partners, customers, and employees, in addition to making invaluable contacts within the venture and angel funding community.

Additional information on presenting and registration can be found at seventure.org andyou can view a list of past presenters here.

 

2013 Southeast Venture Conference set for Charlotte in March

Wednesday, October 17th, 2012
SEVC

The Southeast Venture Conference is headed to Charlotte, NC, in March 2013.

The seventh annual Southeast Venture Conference, a major event for investors and entrepreneurs, is headed to Charlotte, NC, March 13-14 at the Riz-Carlton.

The conference features presentations by 60 of the region’s high growth investment opportunities.

They will include both early and later stage companies from Alabama, Florida, Georgia, Kentucky, Maryland, Mississippi, North Carolina, South Carolina, Tennessee, Virginia, West Virginia and Washington DC.

The conference offers an unparalleled opportunity to Network with hundreds of the region’s leading Entrepreneurs and High Growth Company Executives, National Venture Capitalists and Private Equity Professionals, M&A facilitators and other leading professionals serving the technology community.

We’ve covered many startup and later stage firms that presented at previous SEVC’s and later landed multiple financing rounds.

SEVC is also teaming with the Internet Summit in Raleigh Nov. 6-8 this year to present the two-day Startup Summit focused on entrepreneurs.

ttendees and speakers include leading incubators, venture capital firms, and innovative companies. We’ll feature 16 presenting startups that will showcase their companies and concepts. You’ll have the opportunity to meet them one-on-one in our demo pit.

Speakers at the Startup Summit include influential entrepreneurs and leaders from the investment community:

  • Angus Davis, Founder & CEO, Swipely
  • Paul Singh, Partner & Master of the Hustle, 500Startups
  • Sarah Lacy, Founder & Editor-in-Chief, PandoDaily
  • Scott Maxwell, Founder, OpenView Venture Partners
  • Michael Doernberg, CEO and Co-founder, Reverbnation
  • Laura Witt, General Partner, ABS Capital
  • Rob Go, Partner, NextView Ventures
  • David Morken, Founder & CEO, Bandwidth.com
  • Jonathan Perrelli, Founding Partner, Fortify.vc
  • Dayna GraysonNorth Bridge Venture Partners
  • Neil Kataria, Founder & Chairman, newBrandAnalytics
  • Greg Cangialosi, Managing Dir, Nucleus Venture Partners
  • Jason Caplain, General Partner, Southern Capital Ventures
  • Robbie Allen, Founder & CEO, Automated Insights
  • John Burke, Founder and General Partner, True Ventures
  • Joe Velk, Contender Capital
  • Chris Heivly, Managing Partner, Triangle Startup Factory
  • David Jones, Partner, Southern Capital Ventures
  • Joe Schmidt, CMO, Cafepress
  • Tom Lotrecchiano, Sr Vice President, Cafepress
  • Matt Williamson, Founder & CEO, Windsor Circle

 

 

CEOs rate best states for business: Texas No. 1, NC slips, Florida rises

Wednesday, May 2nd, 2012

TexasFor the eighth year in a row, CEOs rate Texas as the #1 state in which to do business, according to Chief Executive magazine’s annual Best & Worst States Survey, released today.

Florida rose one spot to take the #2 rank, while North Carolina slipped to #3.

Tennessee remained at #4 while Indiana climbed a spot to capture the #5 rank. CEOs named the worst states to do business as California, New York, Illinois, Massachusetts and Michigan.

The Best & Worst States Survey measures the sentiment of CEOs on business conditions around the nation.

For the 2012 survey, 650 CEOs from across the country evaluated the states on a broad range of issues, including regulations, tax policies, workforce quality, educational resources, quality of living and infrastructure.  The survey was conducted from Jan. 24 to Feb. 26, 2012.

Louisiana biggest gainer

Louisiana was the biggest gainer in the survey, rising 14 spots to be the #13th most attractive state in the country to do business. The biggest loser was Oregon, which dropped nine spots to #42.

CEOs surveyed said California’s poor ranking is the result of its hostility to business, high state taxes and overly stringent regulations, which is driving investment, companies and jobs to other states.

According to Spectrum Locations Consultants, 254 California companies moved some or all of their work and jobs out of state in 2011, an increase of 26 percent over the previous year and five times as many as in 2009.

“CEOs tell us that California seems to be doing everything possible to drive business from the state. Texas, by contrast, has been welcoming companies and entrepreneurs, particularly in the high-tech arena,” said J.P. Donlon, Editor-in-Chief of Chief Executivemagazine and ChiefExecutive.net.

“Local economic development corporations, as well as the state Texas Enterprise Fund, are providing attractive incentives. This, along with the relaxed regulatory environment and supportive State Department of Commerce adds up to a favorable climate for business.”

Inhospitable business environments mean less jobs, as entrepreneurs and established corporations seek more cost-efficient and tax-friendly locales, said Marshall Cooper, CEO of Chief Executive magazine and ChiefExecutive.net.  “This survey shows that states that create policies and incentives are rewarded with investment, jobs and greater overall economic activity.”

For complete results, including individual state rankings on multiple criteria, methodology and more, please visitChiefExecutive.net.

Best 5 States for Business Rank 2012 Rank 2011
Texas 1st 1st
Florida 2nd 3rd
North Carolina 3rd 2nd
Tennessee 4th 4th
Indiana 5th 6th
Source:  Chief Executive magazine (ChiefExecutive.net)              
Worst 5 States for Business Rank 2012 Rank 2011
California 50th 50th
New York 49th 49th
Illinois 48th 48th
Massachusetts 47th 45th
Michigan 46th 46th
Source:  Chief Executive magazine (ChiefExecutive.net)              
2012 Biggest Gainers Positions Gained
Louisiana +14
Mississippi +8
West Virginia +8
Ohio +6
North Dakota +6
Source:  Chief Executive magazine (ChiefExecutive.net)

 

2012 Biggest Losers Positions Lost
Oregon -9
Kentucky -8
New Hampshire -8
Nebraska -7
Minnesota -7
Source:  Chief Executive magazine (ChiefExecutive.net)                                                

Kentucky-based MOBIbucks banks $5M for cardless mobile payment tech

Wednesday, July 6th, 2011

MobiBucksLOUISVILLE, KY -  MOBIbucks, which sells cardless mobile payment and marketing software, has raised $5 million in Series A funding. Acadia Woods Partners, a New York-based technology, media and life science venture capital firm, led the round which also included the participation of several new and original angel investors.

The investment fuels MOBIbucks’ growth in key markets around the world and funds customer service in support of new installations.

MOBIbucks is the only mobile payment solution for making purchases using just a mobile phone number — it does not require cash, a card or even a mobile phone to be in the user’s possession to be used. The company’s mobile marketing and rewards solution is a powerful, paperless, cardless merchandising tool to offer coupons, loyalty rewards, gift cards and even online ordering.

“We believe there is an enormous market for mobile commerce applications, in which MOBIbucks is positioned to be a leader. MOBIbucks offers the first cardless, mobile phone agnostic, wireless operator independent, free from card association road blocks payment platform,” said Jorge Fernandes, CEO of MOBIbucks.

Fernandes has a point. Mobile commerce looks as if it may eventually dominate digital commerce and easy payment methods are likely to help fuel its growth.

 

The top 9 growth challenges facing today’s entrepreneurs

Thursday, June 9th, 2011

Growing an Entrepreneurial BusinessBrave entrepreneurial souls have shaped American enterprise, and today, they’re playing the very important role of helping to drive the nation’s economic recovery. And if you’re one of these brave souls—pouring your blood, sweat, and tears into running your own business— Professor Ed Hess stresses that there’s no time for rest. Once you’ve got your start-up off the ground, he says, the daunting task of growing your business to the next level must begin.

“Growing a business presents a whole new group of challenges for entrepreneurs,” says Hess, author of the new book Growing an Entrepreneurial Business: Concepts & Cases (Stanford University Press, 2011, ISBN: 978-0-8047714-1-2, $75.00, www.EDHLTD.com) and professor at the University of Virginia’s Darden Graduate School of Business.

“The good news is that most businesses experience the same or very similar challenges when it comes to growth. There is no need for any entrepreneur to reinvent the ‘growth wheel.’ You just have to be willing to learn from those who grew before you.”

Hess recently studied 54 high-growth entrepreneurial companies based in 23 different states, all of which were designated as successful growth companies by leading magazines or accounting firms. His research findings are the subject of an MBA course he teaches at the Darden Graduate School of Business and the subject ofGrowing an Entrepreneurial Business, which he wrote for entrepreneurs and students.

What sets successful entrepreneurs apart

The 54 companies in Hess’s study operated product and service businesses, had been in business on average 9.6 years, and had reached an average revenue level of $60 million with the range being from $5 million to $350 million.

Some of them, such as Eyebobs in Minneapolis, Trilogy Health Services in Kentucky, Defender Direct in Indianapolis, SecureWorks in Atlanta, and Mellace Family Brands in California, were well-known companies. The research was supplemented with case studies of other successful entrepreneurial growth companies.

““What I found was that these successful companies all faced very similar challenges when it came to growing,” says Hess. “But what sets them apart from those companies that didn’t survive or didn’t reach the same level of success is how they approached that growth.  The companies in my study understood that growth is change and change is risky. Entrepreneurs who understand this and the challenges that come with it are the ones with the best chances for successful growth.”

The top nine growth challenges facing today’s entrepreneurs:

Getting overwhelmed by growth. Growth is change. Growth requires more processes, controls, and people. Too much growth too quickly can create financial, quality, and reputational risks that if not properly managed can lead to the demise of the business. Keeping tabs on all of these factors can easily overwhelm business owners. “Growth is like Mother Nature,” explains Hess. “She can be good or she can wreak havoc with hurricanes, earthquakes, and floods. To properly manage company growth, successful, experienced entrepreneurs recommend the ‘gas pedal’ approach—when you start to feel overwhelmed, let up on the gas to allow processes, controls, and people to catch up.”

Knowing when to say “no.” Most successful start-ups have a plethora of opportunities. The challenge is choosing the right ones. Good opportunities are those that will enhance your company’s strengths and result in a compelling customer value proposition.

“Opportunities that don’t fall into that category should be met with a ‘no, thank you,’” says Hess. “The problem is that too many entrepreneurs never learn to say ‘NO!’ In an effort to get their business off the ground and keep it up and running, they say ‘yes’ to everything. They end up trying to do too much for too many, which dilutes their focus and often the quality of their product or service.

Determining and having the discipline to maintain a narrow strategic focus is critical to success, and that will require that you turn down certain opportunities. Successful entrepreneurs often call it ‘sticking to your knitting.’”

Learning to effectively delegate. For a business to grow, the entrepreneur must grow. When growth begins, you’ll quickly find that you can do only so much and that you need help from others to properly serve customers. You must evolve from being a doer to a manager of employees and then eventually to a manager of managers (a leader). “This may sound easy but it isn’t,” says Hess.

“Most entrepreneurs don’t like to give up control of any aspect of their business. Facing the fact that they can’t do it all on their own and that they must learn to rely on others to complete certain tasks (and not necessarily exactly how they themselves would do them) can be a very hard reality to swallow.”

Transitioning from owner to leader. When you get to the point where you’re delegating tasks and relying on your employees to drive your business, you must also transition from thinking of yourself as just a business owner and start developing as a leader and coach. Evolving toward becoming a leader and coach is challenging, because both roles require emotional intelligence, people engagement, and the ability to relate to individuals in a way that they find meaningful.

“Coaching requires that time be spent getting to know people, listening, caring, understanding their emotional needs, and helping them grow,” explains Hess. “Coaching takes patience and a degree of personal emotional intimacy that many entrepreneurs are not able to achieve. It requires a continuation of the mind shift from ‘me, the entrepreneur’ and ‘my way’ to ‘it is really all about them.’”

Hiring smart. Hiring mistakes are costly, time consuming, and create quality and financial control risks for small businesses. When confronted with impending growth, entrepreneurs often panic and hire employees too quickly, making snap decisions based on little data.

“In my research, bad hiring practices often continued when entrepreneurs tried to hire managers who needed to have functional or technical experience,” notes Hess. “In many cases, the companies had to make multiple costly hires for the same position before finding someone with the right competencies who also fit the company culture.”

He adds, “Many of these entrepreneurs frequently stated that they should have ‘hired more slowly and fired more quickly.’ They made much better hiring decisions when they learned to hire against a competencies and cultural scorecard; conduct multiple interviews; have multiple people interview prospects; hire on a trial basis; establish mentors for new employees; develop a good on-boarding process; and encourage good employees to make hiring referrals.”

Managing cash flow. Many times entrepreneurs get overly engaged in the joy of growth and lose sight of the need to manage cash on a daily basis. Cash flow management during growth periods is critical, because in many cases growth requires investments in people, technology, supplies, etc., ahead of the receipt of cash from customers. Thus, there is often a mismatch between expenditures and receipts.

“This might sound simple, but it can be a major issue if not handled properly,” notes Hess. “Entrepreneurs have to understand that they may not be able to afford all the available growth. The amount of cash available for investment can limit growth, especially in today’s economy when many small businesses can’t get loans or credit lines. And finally, I can’t help but stress the importance of cautiously managing your checkbooks, credit cards, and online accounts. If you do decide to delegate this task, choose the employee you trust the most and set prescribed monetary limits. Check your payments and accounts every day, because frauds do occur.”

Spending too much time putting out fires. A high-growth environment is hectic, sometimes chaotic, with multiple mistakes needing to be corrected almost every day. “Entrepreneurs can easily get sucked into playing the role of ‘firefighter,’” says Hess, “spending their days putting out fires. The problem with that is that growth requires the entrepreneur to plan for more growth, to put in place new and better processes, and to be constantly upgrading processes and resetting priorities.

“It is very difficult to find the time to do all that when your time is eaten up mediating employee conflicts, correcting inventory orders, calming angry customers, and so on. Entrepreneurs in my study found that they had to be disciplined in getting away from their businesses for short periods of time to think and plan. They needed ‘firehouse’ time away from the daily ‘fires’ that pop up when running a business.”

Creating a high-performance “family.” Entrepreneurs often struggle with creating a high-performance “family” or team environment. The challenge, of course, arises when someone in the “family” just isn’t meeting expectations and has to be terminated because they couldn’t grow their skills as the business grew. “Here entrepreneurs face an uphill battle in balancing loyalty and changing performance needs,” notes Hess. “Let someone go who everyone else at the company loves and you’ve created morale and emotional issues.

“Let a poor performer stay and you’ve created morale and emotional issues. See the challenge? The entrepreneurs I researched learned that you can have a ‘family’-like culture and high performance by having clear job expectations; a fair, transparent, and frequent feedback process; and by giving people a fair chance to improve or to step into a role that they could do well.”

Understanding that upgrading never ends. The people, processes, structure, and controls needed to manage a business with $1 million of revenue generally do not work for a business with $10 million of revenue.

“Entrepreneurs often learn the hard way that growth means continual change,” says Hess. “And as you grow, the solutions that worked at one level will most likely not work at the next. Inflection points for the companies I’ve studied occurred frequently when they expanded to 10, 25, 50, and 100 employees. When these changes take place, entrepreneurs often realize their hope of having a smooth-running machine is an elusive dream.”

Success means learning and adapting continually

He continues, “Successful entrepreneurs and their employees are open to learning and adapting in an incremental, iterative, and experimental fashion. The hard truth is that growing businesses generally do not experience much sameness or predictability until they become quite large—for example, larger than $100 million in revenue—but learn to manage these changes properly, and you can keep the ship pointed in the right direction.”

“Growing a business is an evolutionary process,” says Hess. “Growth is messy. Growth is change. Growth has spurts, detours, downturns, and spikes. Growth requires constant learning and improvement. And if not well planned and managed, it can outstrip the capabilities of companies.

“These are important points that must be heeded,” concludes Hess. “Growth should be a strategic decision made only after the risks of growing and not growing have been assessed. My advice is that rather than focus on growing for growth’s sake, base your goals around how you can constantly improve your business. When you do this, you will be able to meet the challenges of business growth head on and with great success.”

Duke Energy buying Progress Energy in stock deal worth $26B

Monday, January 10th, 2011

Duke EnergyCHARLOTTE & RALEIGH, NC – Duke Energy says it will buy Progress Energy in a stock deal worth about $26 billion, resulting in a combined utility with 7.1 million customers, largest in the United States.

The merged firms will operate under the Duke name, headquartered in Charlotte while keeping “substantial operations” in Raleigh.

Bill Johnson, CEO of Progress Energy will take the helm as CEO of the merged companies. Duke CEO Jim Rogers will chair the merged firms.

Johnson called the combination of the two utilities “A perfect fit.”

While the merger may result in some job losses, according to reports, it could also result in lower utility rates.

The merger gives the combined utility increased financial clout.

The combined company will have:

• Approximately $65 billion in enterprise value and $37 billion in market capitalization

• The country’s largest regulated customer base, providing service to approximately 7.1 million electric customers in six regulated service territories North Carolina, South Carolina, Florida,Indiana, Kentucky and Ohio

• Approximately 57 gigawatts of domestic generating capacity from a diversified mix of coal, nuclear, natural gas, oil and renewable resources

• The largest regulated nuclear fleet in the country.

“This combination of two outstanding companies is a natural fit,” said Johnson, chairman, president and chief executive officer of Progress Energy. “It makes clear strategic sense and creates exceptional value for our shareholders. Together, we can leverage our best practices to achieve even higher levels of safety, operational excellence and customer satisfaction, and save money for customers by combining our fuel purchasing power and the dispatch of our generating plants.”

Cracks in cyber security reveal gaping holes in our digital defenses

Tuesday, December 14th, 2010

By Allan Maurer

InZero device

The InZero security device

RESEARCH TRIANGLE PARK, NC – Cybersecurity still seems to be an afterthought among everyone from McDonald’s to Gawker Media, not to mention the U.S. government and military. Too many entities worry about digital security only when it is breached.

Great business strategy that. Apparently, even giving your email address to a publication such as Gawker or to McDonald’s during one of its promotions, can expose your private data these days. Both admitted to serious security breaches as 2010 ends, while many Twitter accounts – including mine – were hacked by someone selling Acai for weight loss this week. Probably because I used the same password for both sites (see: Spammers Exploit Gawker) on Gawker, where I commented maybe once.

TechJournal South had its own problems with a hacked ad server a few months back and had to shift to another. Two major ad networks were hit with a similar problem this week.

And most of those security breaches were relatively minor in the scheme of things. Many more serious ones have already occurred and we have little doubt are to come.

But coming on the heels of the WikiLeaks fracas, these breaches all show a laxness about cybersecurity that I think is increasingly dangerous on the part of commercial enterprises, government agencies and the military, not to mention to each of us personally.

The problem is partly inherent in the open, accessible nature of the Internet. The very ease with which we swim the Internet’s electron sea makes us vulnerable to sharks. Still,the bad guys, be they foreign hacker crews backed by their own governments, malware creators, spammers, scammers or plain old crooks, actively hack away at us, while credit card companies, government agencies, and businesses remain all too often re-active.

We can’t win the cybersecurity battles that way.

It is absolutely necessary – probably for all of us, but certainly for government and commercial entities – to actively combat this problem. Harden passwords, be careful about what we put on thumb drives or pick up on them, shred documents with sensitive data, and find and use security systems not so easy for cyber criminals to break through.

I’ve noted one approach that seems to be powerful, that of using a security device separate from other equipment that acts as a lockbox preventing suspicious or actual malware and other intrusions from ever reaching operating systems. See: Herndon-based firm grabbing media attention for security device. And: NZero keeps the bad guys out.

Meanwhile, Panda Security of Orlando, which provides antimalware software in the cloud rather than on individual machines, has listed the top ten cyber security threats it sees for 2011.

See also: WikiWars: The Face of future conflicts.

There are contrary views. Over at InformIT, Gary McGraw & Ivan Arce explain how the current climate of exaggeration and FUD surrounding cyber attacks does not ultimately serve the best interests of computer security research in Cyber Warmongering and Influence Peddling.

Email TJS Editor Allan Maurer: Allan at TechJournalSouth dot com.

Six lessons for creating successful virtual teams: lesson #1

Tuesday, December 14th, 2010

Virtual Team Success coverThe office of the future might not be an office at all. As virtual teams become more prevalent, we edge ever closer to a culture where “work” means logging in to your company’s online project management site from your home or collaborating with people who each work for different teams or functions at their local co-working establishment.

“Company headquarters” is becoming more of a concept than an actual building. And as physical location becomes less important, companies can hire the best talent regardless of their location. In addition, companies can enhance their efficiency by handing off work across time zones, enabling them to be productive around the clock.

Especially in the Internet company start-up culture and in early-stage biotechnology companies, virtual teams are increasingly prevalent.

But far too often, say Darleen DeRosa and Rick Lepsinger, this vision of the global economy workplace falls short of today’s reality. In other words, virtual teams may be increasingly popular…but they’re not necessarily successful.

“Today it isn’t uncommon for companies to have as many as 50 percent of their employees working on virtual teams,” says Lepsinger, coauthor along with Darleen DeRosa of Virtual Team Success: A Practical Guide for Working and Leading from a Distance (Jossey-Bass/A Wiley Imprint, 2010, ISBN: 978-0-470-53296-6, $50.00, www.onpointconsultingllc.com).

“Our research finds that many organizations recycle the same guidelines and best practices they use for their co-located teams and hope for the best,” says DeRosa. “Frankly, that just doesn’t work. Virtual teams and face-to-face teams are the proverbial ‘apples and oranges’—and leaders who recognize this fact are the ones whose teams succeed.”

To help organizations maximize their investment in virtual collaboration, OnPoint Consulting conducted a study of forty-eight virtual teams to understand the success factors of top performing virtual teams. Surprisingly, 27 percent of virtual teams in the global study were not fully performing. Given these results, the authors recognized the need for a resource that could help organizations and leaders enhance virtual team performance—and so they wrote Virtual Team Success.

Through the study, the authors recognized that virtual teams regularly fall victim to four pitfalls:

Lack of clear goals, direction, or priorities—Because it is tougher to communicate with and inform team members who are geographically dispersed, it is often difficult to keep all team members focused on the same goals, especially over time.

Lack of clear roles among team members—In virtual teams, it is especially important for team members to clearly understand their individual roles and how their work impacts other team members.

Lack of cooperation and trust—Because there is a lack of face-to-face contact inherent in virtual teamwork, the process of establishing trust and relationships that lead to group cooperation can be very arduous. Over time, this lack of collaboration can lead to a lack of trust amongst team members.

Lack of engagement—With virtual teams, people can easily become bored and “check out” because there is a lack of dynamic face-to-face interaction and because there are more distractions.

Eliminate these pitfalls and a team’s chances for success greatly increase. Below DeRosa and Lepsinger identify six lessons—excerpted from the book—for creating successful virtual teams.

We’ll be presenting the rest of the lessons tomorrow, including a reprise of Lesson 1, below.

Lesson #1: Focus on people issues. Essentially, successful teaming depends largely on the effective interaction of team members. Virtual teams need to compensate for the inherent lack of human contact by supporting team spirit, trust, and productivity. The authors identify warning signs that indicate that a team’s “people issues” need more attention.

“You may notice that team members work independently and do not reach out to other team members to collaborate,” says Lepsinger. “You may also notice that an ‘us versus them’ mentality has developed between locations or sub-groups. The truth is, when everyone is engaged and communicating, it is much easier to succeed as a virtual team. When team members build relationships with one another, it prevents people issues from taking over and impacting team efficiency.

Lesson #1 in Action:

  • Develop a team web page where virtual team members can share information and get to know one another.
  • Create ways for team members to interact and communicate informally. Use real-time communication tools like Instant Messaging or social media sites such as Facebook or Twitter to create a virtual water cooler of sorts that allows people on virtual teams to communicate more spontaneously.
  • Build a collective online “resource bank” to share information and experiences.
  • Find ways to “spotlight” team members.
  • Send electronic newsletters or updates to the team.
  • Create ways to virtually celebrate successes as a team
  • Partner team members at different locations on projects and rotate these periodically.

Darleen DeRosa, Ph.D., is a managing partner at OnPoint Consulting. Darleen brings more twelve years of management consulting experience, with deep expertise in the areas of talent/succession management, executive assessment, virtual teams, and organizational assessment. Her client list includes Accenture, Bayer Pharmaceuticals, Daiichi-Sankyo, Gerdau Ameristeel, and Johnson & Johnson.

Richard Lepsinger is president of OnPoint Consulting and has a twenty-five-year track record of success as an organizational consultant and executive. His client list includes Bayer Pharmaceuticals, Citibank, Coca-Cola Company, ConocoPhillips, Goldman Sachs, Johnson & Johnson, NYSE Euronext, PeopleSoft, Prudential, and Subaru of America, among many others

Tomorrow: the other five lesson.

Kentucky-based ZirMed nabs VC backing for online revenue cycle management

Friday, December 10th, 2010

ZirmedLOUISVILLE, KY – ZirMed, a company revenue cycle management solutions to healthcare providers has raised an undisclosed amount of venture backing from Sequoia Capital, according to VentureWire.

Founded in 1999, ZirMed is an information technology company that says it simplifies the complexities of healthcare payments for providers and their patients.

ZirMed solutions include eligibility verification, credit/debit card processing, check processing, claims management, coding compliancy and reimbursement management, electronic remittance advice, patient statements, patient e-commerce solutions, provider credentialing, and lock box services.

EngeryOne Tech names Michael Jones president, Van Steenburg CTO

Wednesday, November 24th, 2010

LEXINGTON, KY – EnergyOne Technologies Inc., a provider of renewable energy solutions and next generation technologies, has appointed co-founder Michael Jones as its president and co-founder Michael Van Steenburg as its Chief Technology Officer.

Jones comes from the electric utility industry with over 30 years of experience and has an extensive background in renewable energy, risk management, regulatory administration, power contracts, utility finance, and engineering and construction. In 2008,  Jones founded Pacific Bluegrass Solar and served as CEO until its merger with EnergyOne in 2010.

In 2002, Jones founded Phoenix Motorcars, a manufacturer of full size, freeway speed Electric Vehicles and raised over $40 million in private equity investments. In 2007, Phoenix Motorcars was invited to the White House to meet with former President George Bush to discuss electric vehicle technologies, with the President test driving the all electric sport utility truck. Phoenix Motorcars was awarded the U.S. Department of Energy’s Energy Innovators Award for 2008. Mr. Jones holds a Degree in Business Management from Pepperdine University.

Van Steenburg is a veteran technology expert who has managed several technology companies and led teams of engineers on all types of advanced technology development programs over the past 20 years. He has created and developed a substantial amount of intellectual property in the green technology area, ranging from structurally insulated panel systems to advanced electric motor drive systems for electric vehicles.

Van Steenburg’s previous companies have been suppliers to many Fortune 500 companies and currently have development contracts with large OEMs. He holds a Degree in Mechanical Engineering from the University of Texas at San Antonio and is in the process of completing his MBA.

Charlotte-based Tree.com buying Kentucky’s SurePoint Lending

Tuesday, November 16th, 2010

Tree logoCHARLOTTE, NC – Tree.com, Inc. (Nasdaq: TREE), the parent company of LendingTree, has agreed to acquire Louisville, KY-based SurePoint Lending, the business name of First Residential Mortgage Network Inc. in a deal worth up to $23 million.

Tree.com will pay SurePoint shareholders an aggregate purchase price of $6 million in cash and contingent consideration up to an aggregate additional $17 million pursuant to earn out provisions over the next three years.

A LendingTree network lender for 11 years, SurePoint has originated more than $10 billion in closed loans since inception and was named the number one refinance lender on the LendingTree network in 2009. Headquartered in Louisville, SurePoint has nearly 500 employees, including more than 300 licensed loan officers, and operates branch locations in Nashville, TN, Tampa, FL, and Indianapolis, IN.

Peak 10 closes on new $155M credit facility, Welsh Carson deal

Tuesday, October 5th, 2010

Peak 10RALEIGH, NC – Peak 10 Inc., a managed services company and data center  operator, and Welsh, Carson, Anderson & Stowe, a private equity firm, have closed a transaction in which Welsh Carson has become the majority shareholder of Peak 10.

As part of the acquisition, Peak 10 has closed a new credit facility for $155 million.

Peak 10’s existing management team, led by Co-Founder, President and CEO David Jones will continue to operate the business. The $155 million credit facility will be used to accelerate Peak 10’s growth plans in managed services and high-growth markets.

“This is a tremendous milestone for our management team and entire company,” said Brian Noonan, executive vice president and chief financial officer.

Two members of the Welsh Carson team, John Clark and Darren Battistoni, will now serve on Peak 10’s board, with Clark serving as chairman. The company will continue its successful track record of organic growth through construction of additional data centers in its existing markets, the addition of greenfield markets, strategic acquisitions and expansion of its service portfolio to meet increasing customer demand.

“We have worked with the Peak 10 management team for several years and have always been impressed by its careful and tactical use of financial resources,” said Ken Klassen, Managing Director, at RBC Capital Markets.  “For this very reason, we continue to support Peak 10’s growth strategy and are excited to see it capitalize on the opportunities that lie ahead.”

Peak 10 combines its secure, private network and enterprise-class data centers with world-class engineering and support to serve market-leading companies nationwide.

Peak 10 offers a wide range of technology offerings including virtualization, managed hosting and cloud-based services in a cost-efficient and reliable platform for its customers. The company owns and operates data centers in ten key markets that include Cincinnati, Ohio; Atlanta, Ga.; Raleigh and Charlotte, N.C.; Tampa, Jacksonville and Fort Lauderdale, Fla.; Nashville, Tenn.; Louisville, Ky.; and Richmond, Va.

Private equity firm, management acquire majority stake in Peak 10

Thursday, September 2nd, 2010

Peak 10CHARLOTTE, NC – Welsh Carson, Anderson & Stowe, a private equity firm, and Peak 10′s executive management have acquired a majority stake in the company. Financial details were not disclosed.

Selling shareholders include majority owner Seaport Capital, a New York-based private equity firm and McCarthy Capital, an Omaha, Neb.-based private equity fund.

Peak 10’s existing management team, led by Co-Founder, President and CEO David Jones will continue to operate the business.

Jones said,  “Our partnership with Welsh Carson enables Peak 10 to continue increasing the scale of our business to meet the high demand for data center infrastructure and related managed services. Our strategic focus remains intact but our resources now position us to more rapidly extend our geographic footprint, strengthen our team and further accelerate our managed services and cloud offerings.”

Peak 10 has managed a path of steady and consistent growth achieved through expansion in the greenfield markets of Jacksonville, FL.; Charlotte, NC.; Tampa, FL. and Raleigh, NC, and through acquisitions of established data center companies in Louisville, KY; Nashville, TN.; Richmond, VA and, most recently, Fort Lauderdale, FL.

In 2007 and early 2008, Peak 10 opened greenfield data centers in Atlanta, Ga. and Cincinnati, Ohio respectively. Over the last two years Peak 10 has completed construction of additional facilities in five of its markets to meet customer growth and demand.

The transaction is expected to close in early October.

Photizo Group inks investment deal for managed print services consulting

Tuesday, July 27th, 2010

Meritu VenturesLONDON, KY – The Photizo Group Inc., a company a consulting and research firm that provides market information and services to vendors, dealers, and end user communities in the managed print services market, has raised an undisclosed investment from Meritus Ventures. Meritus, the sole investor, is the only rural business investment company in the United States.

Companies outsource their hardcopy printing devices, software, supplies, and services through managed print services. Each year, hundreds of players in the managed print services market attend Photizo’s international conferences and purchase Photizo’s cutting edge market research and intelligence reports.

Industry players include Hewlett-Packard, Xerox, Cannon, and Ricoh.

Ray Moncrief of Meritus has taken a position on Photizo’s board.

Photizo has demonstrated an annual revenue growth rate greater than 50 percent since 2006 and doubled revenue from 2008 to 2009. In addition, the company had positive earnings in 2009.

“We want to add several companies to our portfolio in 2010,” added Meritus co-manager Grady Vanderhoofven.

Meritus is a $36.5 million fnd.

“Photizo is a fantastic addition, and we are seeking more investment opportunities in expansion-stage companies in southern and central Appalachia and Arkansas. Our investments drive innovation, job creation, and wealth creation in a region of the country that has traditionally seen limited venture capital activity.”

SEBIO selects semifinalists for biz plan competition

Thursday, July 22nd, 2010

SebioATLANTA – Southeast BIO (SEBIO) has selected ten semifinalists in its fourth annual BIO/Plan Competition.

Launched in 2007, the BIO/Plan Competition is a program developed to promote the creation of new life science companies based in the Southeast.

The ten semifinalists were selected from nearly forty total applications. The applicant pool included applications from Alabama, Florida, Georgia, Kentucky, North Carolina, South Carolina, and Virginia.

They represent a wide range of technologies including small molecule therapeutics, biologics, diagnostics, and medical devices.  Five of the semifinalists selected are from Georgia, three are from Florida, one is from South Carolina, and one is from Virginia.

The technologies emerged from some of the region’s finest research institutions, including Emory University, Florida International University, Georgia Institute of Technology, Medical College of Georgia, Morehouse School of Medicine, Medical University of South Carolina, University of Florida, University of Georgia, and University of Virginia.

“Despite the funding crunch, the level of scientific innovation at universities and startup companies remains extremely impressive as seen from the BIO/Plan applications, and this bodes well for an outburst of valuable commercial opportunities that will attract investment dollars from firms like ours,” said Carlos Parajon, managing  partner, Harbor Island Equity Partners .

“This quality of research and innovation leads to investment and growth, which in turn creates more innovation and positive economic outcomes for the region.”

Each semifinalist is now paired with a small mentoring team and beginning the mentorship phase of the Competition.  Each mentoring team includes three or four experienced professionals from active venture funds or angel groups, biotech entrepreneurs and managers, and service providers with relevant start-up expertise.

The mentoring teams directly interact with the semifinalists over a period of 4 months focusing on the strategic development of the business concept and commercial opportunity.

The teams are also supported with additional resources including development plan templates and guidelines, regulatory consultants, and presentation guidelines and examples.  The ultimate goal of the mentoring process is the creation of an executable development strategy and associated written plan. This rigorous mentorship process is the cornerstone of the Competition.

“Every year, our companies brag about SEBIO’s process and the terrific advice they get from the BIO/Plan mentors,” notes Susan Shows, Senior Vice President, Georgia Research Alliance. “This coaching and the visibility to investors is extremely valuable to the region’s early stage companies.”

Following the mentoring process, each of the semifinalists will submit their written development plan to a panel of judges.  Four finalists will then be selected to present at the Twelfth Annual SEBIO Investor Forum, November 3-4, 2010, in Atlanta, Georgia. The finalists will present to the full conference audience, which includes more than 400 industry leaders from across the region, and over 100 investors from the Southeast and around the world.

The finalists will be awarded face-to-face, private meetings with top investors in the region at which time they can more fully promote their investment opportunity and development plan.  One Southeast BIO/Plan Competition winner will be announced and recognized in a special ceremony at the Investor Forum.

More information about the BIO/Plan Competition, the SEBIO Investor Forum, and sponsorship opportunities can be found on the SEBIO website, www.sebio.org.

Navigation Capital Partners buys LEPservice, seeks more acquistions

Wednesday, July 21st, 2010

Navigation Capital PartnersATLANTA – Navigation Capital Partners, an Atlanta-based middle market private equity firm, has acquired LEPService Inc., an Atlanta-based provider of advanced metering infrastructure – related services to electric utilities in the Southeastern U.S. Financial details were not disclosed. The company is also looking for additional acquisition targets for its utility data management initiative.

LEPService is the second in a series of acquisitions planned by NCP in support of its initiative to build an industry-leading provider of value-added field and data management services to electric, water and gas utilities.

NCP seeks additional acquisitions

NCP  says it is seeking additional, high-quality companies to be a part of this initiative. Ideal companies currently provide field services, data management solutions and/or data hosting solutions to customers in the utility sector.

LEp Helps utilities bring intelligence to various portions of their transmission and distribution infrastructure. NCP plans to merge LEPService with its previous acquisition in this sector, Specialized Technical Services Holdings Inc. (STS), to create a platform company able to offer utility customers a full array of AMI-related services.

STS, based near Lexington, KY,  is a leading provider of smart grid infrastructure upgrades and meter-related services to municipal, co-operative and investor-owned utilities.

LivingSocial nearly doubles its markets in one day

Tuesday, July 13th, 2010

LivingSocialWASHINGTON, DC – LivingSocial has launched its group shopping service in 25 new cities, nearly doubling its market size in one day.

New cities where the service is offered are: Akron, Baltimore, Baton Rouge, Birmingham, Buffalo, Cedar Rapids, Columbus, Detroit, Fort Lauderdale, Fort Worth, Jacksonville, Knoxville, Las Vegas, Louisville, Memphis, Miami, Nashville, South Connecticut, Oakland/Eastbay, Omaha, Richmond, Sacramento, Toronto, Tulsa and Vancouver.

LivingSocial has been expanding at a rapid pace since the beginning of 2010 with launches across the US, UK and now Canada.

LivingSocial is the website where anyone can find out what shops, restaurants, activities and services are popular in their area. The company says its group buying service has dedicated city experts on the ground in every market, constantly researching the best in local attractions to bring a savings of up to 90 percentfor consumers.

The site offers a new promotion every morning, announced via its website, newsletter, Twitter, Facebook and iPhone app. Live for 24 hours, the Deal is available to anyone who clicks on it.

We’ve been reporting on the competition for customers in the local group buying space for a year now. It really gained traction in the last year.

The company has raised about $49 million, most of it in the last year as it competes for market share in the hot group buying space that includes Groupon and other players. Groupon recently nabbed $135 million for its local bargain buying service.

LivingSocial started out as a Facebook app known for its “Pick 5″ favorite items. We turned the tables on CEO Tim O’Shaughnessy here:

Five questions for LivingSocial’s CEO Tim O’Shaughnessy

Vancouver.

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