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Obama and Entrepreneurship

So what plans does Obama have for entrepreneurs? Check out this section from his inaugural address:

“In reaffirming the greatness of our nation, we understand that greatness is never a given. It must be earned. Our journey has never been one of short-cuts or settling for less. It has not been the path for the faint-hearted — for those who prefer leisure over work, or seek only the pleasures of riches and fame. Rather, it has been the risk-takers, the doers, the makers of things — some celebrated but more often men and women obscure in their labor, who have carried us up the long, rugged path towards prosperity and freedom.”

Entrepreneurs are the “risk-takers, the does, the makers of things”. It’s not going to be some new policy that saves the economy. It’s going to be the entrepreneurs who courageously risk everything to take innovation to market. These are the heros of  history who have contributed to capitalism and laid the foundation of progress of the country.

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Guest Post – Keep a Journal, Develop Business Ideas by Chris Sorbe

I’d like to review the previous year before charging headlong into 2009. While many entrepreneurs got a crash course in finance (courtesy of the University of Hard Knocks) I learned an important lesson that had nothing to do with dollars and cents.

Entrepreneur’s Journal

At the suggestion of a friend, I started an “entrepreneur’s journal” this year in which I record business ideas. These may be some of my own original ideas or improvements that I would make to other businesses. There are notes, sketches, flow charts, and even a few rough calculations.

In my journal there are ideas on everything from lemonade stands (seriously) to large-scale power production projects and everything in between. While most of these ideas will be nothing more than sketches on paper, my journal gives me a place to store and record my thoughts on potential business ideas and innovations.

I really learned the value of this practice a few days ago. I was standing at the sink, washing dishes and mulling over a few ideas that I have in my journal when the proverbial lightning struck me hard. It came to me that I could take several ideas (from my journal) and roll them into one business. But when that ah-ha moment hit, the ideas flowed and a complete picture came to my mind of how to bring these separate ideas together.

There are no follow up stories of how I sold that company or idea for millions of dollars.  Lightening struck only a mere five days ago. But it wouldn’t have coalesced had I not taken the time to record my ideas over the past year.

Write it Down!

So if you’re looking for an entrepreneurial resolution, try keeping a journal of your business ideas and endeavors. Pick up a sketch book and take a little time each week, or even when inspiration strikes, to record your ideas. Because if you’re an entrepreneur then you’re ideas are probably world changing and definitely worth writing down.

Less Venture Capital Available

There will be less VC funding available next year. I recently read about the trend in USA Today and wanted to share it.

“Venture capitalists predict that venture investing will fall 10% to $27 billion next year . . . 72% of venture capitalists don’t expect the market for initial public offerings to heat up again until 2010 or later. However, they believe that funding will grow or remain stable for start-ups in clean technology, life sciences and biotechnology” (USAToday.com). Apparently, this information is based on a survey that was sponsored by the National Venture Capital Association.

So how long will this trend last? I don’t know. But the takeaway is that VCs will be scrutinizing their investments even more heavily than before, which obliges entrepreneurs to really nail their business model before soliciting funds. And assuming entrepreneurial activity will not reciprocate this downward trend, angel investments will likely play a critical role in the fund raising process.

However, Richard Branson will be offering entrepreneurs and and their angels a silver lining. His new company, Virgin Money, will formalize lending relationships among friends and family effectively acting as a third party broker that will manage the payment plans to angels, such as friends and family. This could represent a new era in financing that makes sourcing angel capital a less complicated process. The CNN Money business blog explains how.

“Why do you need Virgin Money to borrow from your mom? These relationships can get emotionally complicated. Virgin Money mitigates any awkwardness by handling the payments; consequently default rates decrease to 5% from 14%” (CNN Money).

So maybe it’s time to mail that Christmas card to uncle Fred.