Paying relatively well would be a major plus as would something that provides a solid career (20+ years of work).
Given the sentence from the article, the submitter may not have the risk appetite for what you're suggesting.
While I agree that starting your own business does provide the sort of flexibility and widening of job scope that the submitter wants, the solid career and the good pay are not guaranteed. I've read statistics (no sources spring to mind, sorry) that only about 10 - 30% of startups survive past the first three years. And these are the years where you're likely to be getting the least amount of pay out of the business as you'll be wanting to reinvest everything into the business to give it the best possible chance of succeeding in the long run.
That being said, starting (or trying to start) a business can be the most rewarding thing around. I've tried it several times and failed for various reasons, but I would do it all over again if I spotted a reasonably good opportunity because it gives you the chance (in fact, it's practically a requirement) to move around a good deal and fill in gaps in your knowledge you probably never knew you had.
Ask yourself the following questions if this is a route you're considering:
1. Are you prepared to take on a substantial amount of risk when you're starting out? Remember that you will not have much in terms of financial leverage and brand name, and there will be unscrupulous customers who will try to delay payment as much as possible just because they know they have a reasonable chance of getting away with it.
2. Can you ensure that you will have a good work-life balance when you're doing this? A lot of people I know who have started businesses of their own have started with a home office to save on costs, but having a family as well means that you will probably find it hard to differentiate between "work time" and "family time".
I'm seeing quite a few commentors essentially bashing the authors of the study for "not knowing what they are talking about".
While many Slashdot users are critical of Microsoft and management type academics/practitioners in general, you should note that Pankaj Ghemawat (one of the authors of the article) is a very well-respected researcher in the field of strategy and competition. Some of his books are widely used in business schools around the world to teach the field of strategic management, indicating (to me, at least) that he might not be as incompetent as some would like to believe.
That being said, I think we should reserve judgement on the quality of the research until we have actually read the published and peer-reviewed article as such. The key sentence in the article on the Harvard Business School website is: "The model captures what we believe are the most important features of the Linux-Windows competitive battle (faster demand-side learning on the part of Linux and an initial installed base advantage for Windows), but makes important assumptions regarding other aspects."
Until we know what these "important assumptions" are, it's quite premature to say whether this study adds any value to the discussion or not.
I have to say, this is a really excellent question but one which, I'm afraid, takes an entire treatise and months of intense study to get a reasonable grasp of the subject. I'll grab the bull by the horns and try to summarise it in one post.:)
Remember that shareholders get return on their invested money from two sources: dividends and the sale price of the shares when they get around to selling them. Theoretically, it shouldn't matter if the company doesn't pay any dividends at all, because the increase in the value of the shares should reflect the value of the dividends that weren't paid.
Earnings growth appears to be the best solution we have at the moment for several reasons. Financial types generally assume that a company that has stagnated in growing its earnings is either a failing company or has reached its peak and needs to adapt. This is due to the concept of the time value of money, which in a nutshell means that a dollar gained today is worth more than a dollar gained at the same time next year. Shareholders want to see earnings growth because it signals to them that the company is increasing its value, which theoretically should drive up the price of the company's shares (since it means that each shareholder's share of the pie is worth more) and so on.
Essentially, a company should aim to increase its profit growth figures by at least the cost of capital, i.e. the amount that the company needs to pay to exist as it stands. Anything less than that indicates that the company is destroying value which theoretically means that the share price should go down.
If you're talking about real estate in terms of things like Real Estate Investment Trusts (REITs), I agree with you to some extent. It's arguable, however, that real estate is the best security of all available.
I forgot who authored the study, but it was referenced in a book by Burton Malkiel called "A Random Walk on Wall Street", which said that investments in a diversified equities portfolio over a long period of time (assuming that all dividends are reinvested) have demonstrated the greatest returns over all other investment choices. Which makes sense if you think about how the value of the Dow Jones Industrial Average has appreciated over the past few decades.
That being said, if you're talking about real estate in terms of purchasing a house or an apartment somewhere, it's a potentially expensive venture that may or may not work out.
Firstly, the way you make relatively steady cash flows from owning any property is by renting it out. Rental income can be difficult - you have issues with renters not paying up on time (or at all, in some cases) and you need to incur costs to protect those cash flows, whether by taking on the services of a property agent or by litigation if it should come to that. These costs need to be priced in.
Secondly, these properties need to be maintained. A lot of apartments require service charges from every owner just to keep the facade of the building clean (and so on), some of which can be quite substantial depending on where your property is located. If you bought a house, you'd also need to constantly pay to keep it in a saleable condition.
Finally, you have the problem of liquidity. You can't easily sell off a house or an apartment at the price you want and the time you want just because the potential purchaser might be unhappy about something (doesn't like the fact that the nearest bus stop is a 15 minute walk away, for example).
It's not impossible to make money off real estate. I know some people who make a LOT doing it but you have to really know your market well and the mantra seems to be "LOCATION LOCATION LOCATION".
Re:Indians will complain about foreigners soon
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I'm afraid I think you need to be aiming a little higher than breakeven.
Assuming you're paying yourself a wage in line with what you get working for some other company, you're actually operating at a loss. Don't forget the opportunity costs. Just for starting a business, you are opening yourself up to a lot more risk - relatively unstable income and cash flows, for one. Suppliers are going to insist you pay up fully on time whereas customers tend to try to find ways to delay payment for as long as possible.
At some point, you're probably going to have to start looking for some form of external financing in the form of a bank loan or by selling shares in your company to someone else. If you are only managing for breakeven, nobody's going to buy the shares and the bank will probably be loathe to loan any money to you unless you put up a large sum of collateral since, from the perspective of the bank manager, you'd be quite a substantial credit risk. Business would become increasingly more difficult then.
For any investment decision, the benchmark I always try to beat is the yield on long-term government bonds. Since those are generally assumed to be the safest available option, you'd need to try to beat those figures to compensate for the additional risk that you're taking on.
The 40 quid and a form allows you to register a company in the UK, which is a requirement for registration with Companies House, I believe.
The 200,000 quid is a separate requirement that's imposed by the Home Office on foreign nationals, I suppose as a deterrent for people who start little "businesses" that are shell companies and merely used to circumvent the normal immigrations process. The money has to be owned by the business and used for business purposes and cannot be taken out for a period of (I believe) 5 years. For a start up, that's immense.
With regards to ten years living in the UK, you can change your status to a permanent residence but under some other quite restrictive requirements. You cannot have left the country for a total of 18 months throughout the entire time period, and you must have stayed in the country for the past 3 years continuously prior to making the application. Given that people nowadays tend to be posted abroad for business, or pursue other (temporary) opportunities in other parts of the world nowadays, that's an extremely tough act to follow.
You make the assumption that greedy is a bad thing
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When I use the term "greedy", I imply "looking for the best return for their money". Note in my original post I mentioned that I hold equity positions in several companies and ROE is one of the main drivers for making an investment decision. Ethics plays a part in the decision process - I don't invest in arms manufacturers as a matter of principle for example, but ultimately I would be doing myself a disservice if I were to invest in a company that offered poorer returns for higher risk than in a company that offered higher returns for lower risk.
I like to think of myself as a globalist thinker however there are many things about the state of the world as it stands that really sticks in my side.
We absolutely need to be able to cross boundaries freely and work together. It is, economically speaking, the most sanguine decision we can make. However, politics and national ideals intervene.
I have lived in England for the past decade and, falling in love with the country and Europe in general, I've wanted to work in the European Union for quite a few years. However, for any employer to employ me (as a Malaysian), they have to first prove that no citizen of the country can fulfill the job requirements, before they widen their search to the EU in general. After this process has been done, I can be hired as a non-EU citizen. This takes time and money which many smaller companies or charities simply cannot afford so I would tend to be pushed in the direction of larger corporations which have the resources to perform such a search.
Furthermore, the selection process is clearly biased towards professional people seeking employment in large corporations. What if I was bitten by the entrepreneurial bug and wanted to start my own business? In the UK, I can't do that unless I provided 200,000 pounds of my own cash as start-up capital. Not VC-financed or a bank loan.
The concept of statehood was a great idea in establishing the concept of a national identity and a shared consciousness in the people living in it, but it is now obsolete. The trouble is knowledge and capital move much more freely than they did in the past few decades, but the freedom of movement in labour still has some way to catch up.
Re:Indians will complain about foreigners soon
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I thought your post was particularly interesting, so I feel moved to comment.
The bottom line is, unfortunately, very important. Remember that the companies that can afford to offshore/outshore are generally larger companies which tend to be shareholder-owned and require either equity or debt financing.
The trouble with being beholden to shareholders is that capital really is mobile and shareholders are normally a greedy bunch. If the business does not offer a good bottom line - leading to all the things that shareholders like to have, for example a good dividend or a good rise in the share price, shareholders will tend to want to move their money elsewhere. Assume that you can invest in company A which offers a 4% return on equity or company B which offers a 10% return on equity. Which would you invest in as a shareholder?
You may argue that shareholders are increasingly placing more importance on things like corporate social responsibility and so on, but as a shareholder myself, I can tell you that it's really really hard to make an assessment based on that. The corporate social responsibility movement is plagued by the fact that MANY companies make promises (to varying degrees of compliance) and it costs me a LOT of time and effort to check which ones actually comply with their statements or not. Ultimately, I throw my hands up in the air, give up, and use ROE for my investment decisions.
I disagree that you'd make a bad manager, I think you'd be a great one in certain conditions. You might not be a great manager in a profit-driven, shareholder-owned multinational corporation but the business world isn't exclusively those. There are lots of smaller companies which are more local and people-focused which is where I think your refreshing attitude would be a valuable asset.
Check out Virtual Appliances. Basically, there are people who've already fully configured environments in a virtual machine so you can just pick up the free (as in beer) VMWare Player product and run them.
Why would you want to do that? I use a virtual machine to browse the Web - that way, my computer doesn't get bogged down by spyware (only the virtual machine does) and it's much more painless to simply purge a spyware-ridden virtual machine and start afresh than it is for your main computer.
I originally thought this was a bit of extremely bad PR at first. When thinking about this further, I do believe that Vonage might have a justification for insisting payment.
I couldn't find any information about the IPO price-setting process in the United States but I am assuming (call it an educated guess) that, at some point prior to the IPO, Vonage must have announced to all participants in the IPO a confirmed price per share: in this case, $ 17 per share. It would then make sense to me that Vonage would be obliged to give participants the option of dropping out, or confirming that they are still interested in purchasing the shares.
Assuming all the above is true, I would think that, at the date of the IPO itself, purchases are contractually obliged to purchase those shares at $ 17 per share and pay up. The article seems to imply that the investors are now balking on their contractual obligation and refusing to pay up given that price per share has fallen in subsequent days.
However, I have not been able to find any evidence to suggest that Vonage has been unfair in its IPO process. Of course, as this story pans out, we may actually hear from some of the individuals involved.
I did, however, find an early SEC filing related to this auction, available here. This filing doesn't seem to give any information about the proposed initial price, but I thought it was interesting that the company did disclose that theirs was a high risk stock, and listed several risk factors that could negatively impact the value of their stock.
"You can't replicate that in Europe. Change your laws."
Let's take a simpler example - the member states of the European Union. One major issue for entrepreneurs in the European Union is that, except for the larger member states, the population and market may not be large enough for whatever new product or service is being introduced. This necessitates quite a bit of cross-border trade.
You can argue that there has been quite a lot of work done by the European Commission on reducing the barriers to inter-EU trade, but one area which still remains extremely complicated today is in the area of corporate taxation.
The situation is, broadly, as follows: each member state has considerable leeway in determining the tax bases and setting the appropriate tax rates on corporations within its jurisdiction. Tax regulations in each member state can be substantially different, and this means that the corporation could incur large tax compliance costs simply to ensure that they don't fall foul of any laws of the member states in which they operate.
The European Commission has advanced several suggestions to alleviate this problem: look up Home State Taxation and the Common Consolidated Tax Base, for example. However, I don't think it's likely these measures will be implemented too soon mainly because many member states view the right to set their own levels of taxation as an issue of national sovereignty.
It's an issue, I believe, which will be settled in the political arena which may or may not be backed by underlying economic rationale. But until such time as questions such as these are settled, I do have my doubts whether the European Union can be a globally-recognised entrepreneurial force.
I'm a little skeptical about Cyberjaya, actually. Specifically, because it seems that Malaysia has yet to fully develop the ingredients required for such a project to realize its potential.
Firstly, Malaysia still lacks the highly skilled workforce that is required. I don't have hard figures for this; only anecdotal evidence. The best brains know that the market for their capabilities is essentially global (I know there are barriers to the free movement of labour, but that's another discussion) and would tend to move to places where they are given better financial compensation.
Secondly, the culture still has a hostile attitude towards bankruptcy and failure. You see it at many levels; parents who chide their students for "only" getting 7 As in their SPM (national high school examination) instead of 13 or 14 or whatever the newest record is. The people who speak of disclosed bankrupts in hushed whispers. It really does tend to make a lot of potential risk-takers think twice about embarking on their risky activity.
Finally, the venture capital industry is still somewhat underdeveloped. I know the Malaysia Venture Capital Management Berhad (MAVCAP) is making some inroads into this, but it's going to take a while before they fully develop the capabilities that larger international VCs have.
I do believe it is a worthy investment, though. It is, however, one of the things that will take years and years to pay off, if at all.
... so I feel interested enough in this topic to post a comment.:)
The "success" of Silicon Valley is being reproduced in different parts of the world - Cambridge in the United Kingdom especially springs to mind. Having spoken with some of the people heavily involved in this project, we determined that there were several key ingredients that made Silicon Valley essentially unique and hard to reproduce.
The superficial similarities are easy to point out - there are quite a large amount of venture capitalists in both places (or easy access to venture capital money), proximity to large research universities. However, the differences between the two locations are telling.
Firstly, as several other posters have described, the attitudes towards bankruptcy can be vastly different. In our study, we looked at differences in attitude between the United States, the United Kingdom and the Netherlands and found that while failure in your first entrepreneurial undertaking is considered almost de rigueur in Silicon Valley, the culture in the UK and the Netherlands tends to be less forgiving. While this is now changing, there are still many people with good ideas who are still worried about taking on high-risk projects because the perceived cost of failure is much higher.
Secondly, the attitude of the VCs and business angels towards companies. For example, we found that VCs in the Netherlands tended to have a narrower scope than VCs in both the United Kingdom and the United States. We spoke to a few large VC firms in the Netherlands and found that many of them invested only in companies whose main base of operations would be in any one of the Benelux countries. Their justification for this being that they felt it lowered their risk profile.
I also believe that Paul Graham might have downplayed the influence of governmental policy on entrepreneurship. While I'm not too sure about the situation in Silicon Valley, certainly in the UK and NL, there are entrepreneurs who view VC financing as a "lender of last resort", as it were. They've heard many stories of how VCs put very restrictive covenants on the way business is conducted, for example the need to sell their stake in the company after a certain amount of years, and they are wary of this before seeking out such financing. The first port of call for money tends to be grants, either from the nearby universities or from the government. These grants have the advantage of being relatively liberal (once you've convinced the committee to give you the money, they maintain a pretty hands off approach to the way you run your business) and are a good way to build value in the company with a very low cost to the founders.
There is also some evidence that rates on personal income tax and capital gains tax can have a strong effect on the rates of entrepreneurship, although I wouldn't want to comment too much on this as I haven't studied this avenue in very much detail. There are, however, papers that go into this in more detail. Notably:
Cullen, Julie Berry, Gordon, Roger H., 2002. Taxes and Entrepreneurial Activity: Theory and Evidence for the U.S. NBER Working Paper 9015
Gentry, William M., Hubbard, R. Glenn, 2005. "Success Taxes", Entrepreneurial Entry, and Innovation. NBER Innovation Policy & The Economy, Vol. 5 Issue 1, p87-108
Keuschnigg, Christian, Nielsen, Søren Bo, 2003. Tax Policy, Venture Capital, and Entrepreneurship. Journal of Public Economics, Vol. 87 Issue 1, p175, 29p.
I could go on and on about this, but the point is that this is still an active topic of research and the actual drivers of entrepreneurship can be quite hard to elucidate. There is a very good book that serves as a good launching point for further study in this topic entitled "Clusters of Creativity: Enduring Lessons on Innovation and Entrepreneurship from Silicon Valley and Europe's Silicon Fen" by Rob Koepp. Book is readily available from Amazon.
No, biofeedback training is something I've only heard of in passing so I can't say I know of much good information about it.
If it's something that has to be learnt over the course of a few days though, would it be a very marketable concept in your opinion? My guess is that people will want to pick up a device which they can use straight away, not something they have to train for just to play a game or two.
But if you know a lot more about biofeedback training, you might be able to enlighten me.:)
When I was a physiology student, we examined saccades - high speed movements of the eye. We do not smoothly transition our field of vision to something interesting, we tend to "snap" our focus instantly to catch a better glance.
Where this was interesting, I thought, would be if we could leverage this mechanism as an input device especially for FPS games. Instant targeting and pretty damned accurate aim.
However, there probably won't be too much of a market outside that though, since smooth and steady movements of the eyes are pretty difficult to achieve, if not impossible.
Not directly relevant to the topic, but you can view some pretty comprehensive salary information at
http://www.h1b.info/lca_search.php
The information from the database is supposedly taken from the details provided by employers filing for H1B visas, so may not 100% reflect what's out there in the market. However, I've been told the amounts pretty much reflect what US citizens would expect to receive anyway.
It's out of fear of situations like you went through that I lead a property-less existence. Besides my computer (which I frankly can't live without), I rent my own home and car. Some people call it stupid since I'm essentially giving away my money and getting nothing in return but, when the shit hits the fan, I'm able to give it all away and live off whatever I have saved until I get a new job. No need to pay off mortgages (hint: just because you lost your job, doesn't mean you don't have to pay off your mortgage anymore) which is quite reassuring.
Perhaps not in the USA, but when I was in Britain, I read an editorial about the mobile phone revolution and how it was helping the homeless be more contactable. I'm sure there are at least some of them who do genuinely want to change their lives in the hope of moving out of homelessness. It really isn't a state one would like to live in for long.
I presume resumes for less qualified individuals would be different from what you and I are used to. Who knows - the effort of producing a piece of paper that states the person's skills (even if only the fact they were a star athlete in high school 5 years ago, for example) might give a potential employer enough good vibes to give the person a try. You never know.
Despite criticism that the Bill and Melinda Gates Foundation might have some vested interest in providing public access computers in libraries, I view this as a good thing. Public free access enables a lot of people who otherwise wouldn't be able to participate in online activity - for example, homeless people putting their resumes online in the hopes of finding employment.
In this case, funding came from a foundation started by a private individual. What about in other countries where there isn't so much of a culture of public donations (true, there are robber baron CEOs, but I'm thinking in the lines of the donations given by people like Andrew Carnegie)? Unless there's strong political will, I don't think it's going to happen - beneficial though it is, it looks more like a "nice to have" rather than a "must have".
Just to clarify, I mentioned "taking risks" more as a form of reassurance. The fact is, going back to college involves a significant change of lifestyle and I wouldn't blame anyone for feeling anxiety and trepidation at making such a move. Much less eating out at restaurants (fancy or otherwise) and getting used to ramen instead and car? Pretty much forget it. I guess I am also shaped by the knowledge that I'm from a country which isn't known for solid tertiary education - hence many of us who can tend to leave the country for colleges and universities elsewhere. Needless to say, the amount of debt one incurs is substantial. This may not be the case for all Americans/British/Australians/etc, but I wouldn't be surprised if college cost at least a little something which needs to be paid off at some point?
And I couldn't agree more with your case about doing whatever degree you want in college. Every job that I've done simply used my computer science degree as a talking point during the interview - they wanted to know if I knew my shit, basically. In the name of equal opportunities or what have you, there were also recruits from other backgrounds - e.g. mathematics, business and history. They all did fine after some formal and on-the-job training.
For those (like myself) who have little idea about spintronics, Wikipedia has a general article that seemed to explain it to me quite well. Of course, I'm not a physicist so I have no idea whether or not it's accurate although I'm tempted to find out more from the referenced article. PhysicsWeb has more of the same. Apparently this will have far-reaching implications on RAM and cable bandwidth.
Economy's not going too well, find yourself stuck in a bit of a rut jobwise and would like to move up and out? Go to college and get yourself that degree. Seriously.
A college degree may not necessarily be your passport to riches beyond your wildest dreams but, at the very worst, you could end up exactly where you left off. However, take the time you spend in college to learn a lot of things that you never had the time to learn in 'real life', meet a lot of people, and chances are you'll grow to be a better person (I know college sure taught me a lot of useful life skills).
You're still young, you can still afford to take risks. Do it now so you won't have to regret later.
This isn't anything too new. For kicks, I once searched for "Resume" and "Credit card" on KaZaA and got hundreds of results. Presumably, the trouble is that people sometimes believe that security through obscurity works - or, in the case of KaZaA, a lack of attention leads people to share files they didn't really want to.
Interestingly, I found a text file with all the user names and passwords for brokerage firms, and bank accounts, of the IT director at the firm I was working in. Scary, considering he was supposed to have "15 years in the IT industry".
Slashdot Mirror
From the article:
Paying relatively well would be a major plus as would something that provides a solid career (20+ years of work).
Given the sentence from the article, the submitter may not have the risk appetite for what you're suggesting.
While I agree that starting your own business does provide the sort of flexibility and widening of job scope that the submitter wants, the solid career and the good pay are not guaranteed. I've read statistics (no sources spring to mind, sorry) that only about 10 - 30% of startups survive past the first three years. And these are the years where you're likely to be getting the least amount of pay out of the business as you'll be wanting to reinvest everything into the business to give it the best possible chance of succeeding in the long run.
That being said, starting (or trying to start) a business can be the most rewarding thing around. I've tried it several times and failed for various reasons, but I would do it all over again if I spotted a reasonably good opportunity because it gives you the chance (in fact, it's practically a requirement) to move around a good deal and fill in gaps in your knowledge you probably never knew you had.
Ask yourself the following questions if this is a route you're considering:
1. Are you prepared to take on a substantial amount of risk when you're starting out? Remember that you will not have much in terms of financial leverage and brand name, and there will be unscrupulous customers who will try to delay payment as much as possible just because they know they have a reasonable chance of getting away with it.
2. Can you ensure that you will have a good work-life balance when you're doing this? A lot of people I know who have started businesses of their own have started with a home office to save on costs, but having a family as well means that you will probably find it hard to differentiate between "work time" and "family time".
I'm seeing quite a few commentors essentially bashing the authors of the study for "not knowing what they are talking about".
While many Slashdot users are critical of Microsoft and management type academics/practitioners in general, you should note that Pankaj Ghemawat (one of the authors of the article) is a very well-respected researcher in the field of strategy and competition. Some of his books are widely used in business schools around the world to teach the field of strategic management, indicating (to me, at least) that he might not be as incompetent as some would like to believe.
That being said, I think we should reserve judgement on the quality of the research until we have actually read the published and peer-reviewed article as such. The key sentence in the article on the Harvard Business School website is: "The model captures what we believe are the most important features of the Linux-Windows competitive battle (faster demand-side learning on the part of Linux and an initial installed base advantage for Windows), but makes important assumptions regarding other aspects."
Until we know what these "important assumptions" are, it's quite premature to say whether this study adds any value to the discussion or not.
I have to say, this is a really excellent question but one which, I'm afraid, takes an entire treatise and months of intense study to get a reasonable grasp of the subject. I'll grab the bull by the horns and try to summarise it in one post. :)
Remember that shareholders get return on their invested money from two sources: dividends and the sale price of the shares when they get around to selling them. Theoretically, it shouldn't matter if the company doesn't pay any dividends at all, because the increase in the value of the shares should reflect the value of the dividends that weren't paid.
Earnings growth appears to be the best solution we have at the moment for several reasons. Financial types generally assume that a company that has stagnated in growing its earnings is either a failing company or has reached its peak and needs to adapt. This is due to the concept of the time value of money, which in a nutshell means that a dollar gained today is worth more than a dollar gained at the same time next year. Shareholders want to see earnings growth because it signals to them that the company is increasing its value, which theoretically should drive up the price of the company's shares (since it means that each shareholder's share of the pie is worth more) and so on.
Essentially, a company should aim to increase its profit growth figures by at least the cost of capital, i.e. the amount that the company needs to pay to exist as it stands. Anything less than that indicates that the company is destroying value which theoretically means that the share price should go down.
If you're talking about real estate in terms of things like Real Estate Investment Trusts (REITs), I agree with you to some extent. It's arguable, however, that real estate is the best security of all available.
I forgot who authored the study, but it was referenced in a book by Burton Malkiel called "A Random Walk on Wall Street", which said that investments in a diversified equities portfolio over a long period of time (assuming that all dividends are reinvested) have demonstrated the greatest returns over all other investment choices. Which makes sense if you think about how the value of the Dow Jones Industrial Average has appreciated over the past few decades.
That being said, if you're talking about real estate in terms of purchasing a house or an apartment somewhere, it's a potentially expensive venture that may or may not work out.
Firstly, the way you make relatively steady cash flows from owning any property is by renting it out. Rental income can be difficult - you have issues with renters not paying up on time (or at all, in some cases) and you need to incur costs to protect those cash flows, whether by taking on the services of a property agent or by litigation if it should come to that. These costs need to be priced in.
Secondly, these properties need to be maintained. A lot of apartments require service charges from every owner just to keep the facade of the building clean (and so on), some of which can be quite substantial depending on where your property is located. If you bought a house, you'd also need to constantly pay to keep it in a saleable condition.
Finally, you have the problem of liquidity. You can't easily sell off a house or an apartment at the price you want and the time you want just because the potential purchaser might be unhappy about something (doesn't like the fact that the nearest bus stop is a 15 minute walk away, for example).
It's not impossible to make money off real estate. I know some people who make a LOT doing it but you have to really know your market well and the mantra seems to be "LOCATION LOCATION LOCATION".
I'm afraid I think you need to be aiming a little higher than breakeven.
Assuming you're paying yourself a wage in line with what you get working for some other company, you're actually operating at a loss. Don't forget the opportunity costs. Just for starting a business, you are opening yourself up to a lot more risk - relatively unstable income and cash flows, for one. Suppliers are going to insist you pay up fully on time whereas customers tend to try to find ways to delay payment for as long as possible.
At some point, you're probably going to have to start looking for some form of external financing in the form of a bank loan or by selling shares in your company to someone else. If you are only managing for breakeven, nobody's going to buy the shares and the bank will probably be loathe to loan any money to you unless you put up a large sum of collateral since, from the perspective of the bank manager, you'd be quite a substantial credit risk. Business would become increasingly more difficult then.
For any investment decision, the benchmark I always try to beat is the yield on long-term government bonds. Since those are generally assumed to be the safest available option, you'd need to try to beat those figures to compensate for the additional risk that you're taking on.
The 40 quid and a form allows you to register a company in the UK, which is a requirement for registration with Companies House, I believe.
The 200,000 quid is a separate requirement that's imposed by the Home Office on foreign nationals, I suppose as a deterrent for people who start little "businesses" that are shell companies and merely used to circumvent the normal immigrations process. The money has to be owned by the business and used for business purposes and cannot be taken out for a period of (I believe) 5 years. For a start up, that's immense.
With regards to ten years living in the UK, you can change your status to a permanent residence but under some other quite restrictive requirements. You cannot have left the country for a total of 18 months throughout the entire time period, and you must have stayed in the country for the past 3 years continuously prior to making the application. Given that people nowadays tend to be posted abroad for business, or pursue other (temporary) opportunities in other parts of the world nowadays, that's an extremely tough act to follow.
When I use the term "greedy", I imply "looking for the best return for their money". Note in my original post I mentioned that I hold equity positions in several companies and ROE is one of the main drivers for making an investment decision. Ethics plays a part in the decision process - I don't invest in arms manufacturers as a matter of principle for example, but ultimately I would be doing myself a disservice if I were to invest in a company that offered poorer returns for higher risk than in a company that offered higher returns for lower risk.
I like to think of myself as a globalist thinker however there are many things about the state of the world as it stands that really sticks in my side.
We absolutely need to be able to cross boundaries freely and work together. It is, economically speaking, the most sanguine decision we can make. However, politics and national ideals intervene.
I have lived in England for the past decade and, falling in love with the country and Europe in general, I've wanted to work in the European Union for quite a few years. However, for any employer to employ me (as a Malaysian), they have to first prove that no citizen of the country can fulfill the job requirements, before they widen their search to the EU in general. After this process has been done, I can be hired as a non-EU citizen. This takes time and money which many smaller companies or charities simply cannot afford so I would tend to be pushed in the direction of larger corporations which have the resources to perform such a search.
Furthermore, the selection process is clearly biased towards professional people seeking employment in large corporations. What if I was bitten by the entrepreneurial bug and wanted to start my own business? In the UK, I can't do that unless I provided 200,000 pounds of my own cash as start-up capital. Not VC-financed or a bank loan.
The concept of statehood was a great idea in establishing the concept of a national identity and a shared consciousness in the people living in it, but it is now obsolete. The trouble is knowledge and capital move much more freely than they did in the past few decades, but the freedom of movement in labour still has some way to catch up.
I thought your post was particularly interesting, so I feel moved to comment.
The bottom line is, unfortunately, very important. Remember that the companies that can afford to offshore/outshore are generally larger companies which tend to be shareholder-owned and require either equity or debt financing.
The trouble with being beholden to shareholders is that capital really is mobile and shareholders are normally a greedy bunch. If the business does not offer a good bottom line - leading to all the things that shareholders like to have, for example a good dividend or a good rise in the share price, shareholders will tend to want to move their money elsewhere. Assume that you can invest in company A which offers a 4% return on equity or company B which offers a 10% return on equity. Which would you invest in as a shareholder?
You may argue that shareholders are increasingly placing more importance on things like corporate social responsibility and so on, but as a shareholder myself, I can tell you that it's really really hard to make an assessment based on that. The corporate social responsibility movement is plagued by the fact that MANY companies make promises (to varying degrees of compliance) and it costs me a LOT of time and effort to check which ones actually comply with their statements or not. Ultimately, I throw my hands up in the air, give up, and use ROE for my investment decisions.
I disagree that you'd make a bad manager, I think you'd be a great one in certain conditions. You might not be a great manager in a profit-driven, shareholder-owned multinational corporation but the business world isn't exclusively those. There are lots of smaller companies which are more local and people-focused which is where I think your refreshing attitude would be a valuable asset.
Check out Virtual Appliances. Basically, there are people who've already fully configured environments in a virtual machine so you can just pick up the free (as in beer) VMWare Player product and run them.
Why would you want to do that? I use a virtual machine to browse the Web - that way, my computer doesn't get bogged down by spyware (only the virtual machine does) and it's much more painless to simply purge a spyware-ridden virtual machine and start afresh than it is for your main computer.
I couldn't find any information about the IPO price-setting process in the United States but I am assuming (call it an educated guess) that, at some point prior to the IPO, Vonage must have announced to all participants in the IPO a confirmed price per share: in this case, $ 17 per share. It would then make sense to me that Vonage would be obliged to give participants the option of dropping out, or confirming that they are still interested in purchasing the shares.
Assuming all the above is true, I would think that, at the date of the IPO itself, purchases are contractually obliged to purchase those shares at $ 17 per share and pay up. The article seems to imply that the investors are now balking on their contractual obligation and refusing to pay up given that price per share has fallen in subsequent days.
However, I have not been able to find any evidence to suggest that Vonage has been unfair in its IPO process. Of course, as this story pans out, we may actually hear from some of the individuals involved.
I did, however, find an early SEC filing related to this auction, available here.
This filing doesn't seem to give any information about the proposed initial price, but I thought it was interesting that the company did disclose that theirs was a high risk stock, and listed several risk factors that could negatively impact the value of their stock.
This comment mainly relates to the quote:
"You can't replicate that in Europe. Change your laws."
Let's take a simpler example - the member states of the European Union. One major issue for entrepreneurs in the European Union is that, except for the larger member states, the population and market may not be large enough for whatever new product or service is being introduced. This necessitates quite a bit of cross-border trade.
You can argue that there has been quite a lot of work done by the European Commission on reducing the barriers to inter-EU trade, but one area which still remains extremely complicated today is in the area of corporate taxation.
The situation is, broadly, as follows: each member state has considerable leeway in determining the tax bases and setting the appropriate tax rates on corporations within its jurisdiction. Tax regulations in each member state can be substantially different, and this means that the corporation could incur large tax compliance costs simply to ensure that they don't fall foul of any laws of the member states in which they operate.
The European Commission has advanced several suggestions to alleviate this problem: look up Home State Taxation and the Common Consolidated Tax Base, for example. However, I don't think it's likely these measures will be implemented too soon mainly because many member states view the right to set their own levels of taxation as an issue of national sovereignty.
It's an issue, I believe, which will be settled in the political arena which may or may not be backed by underlying economic rationale. But until such time as questions such as these are settled, I do have my doubts whether the European Union can be a globally-recognised entrepreneurial force.
I'm a little skeptical about Cyberjaya, actually. Specifically, because it seems that Malaysia has yet to fully develop the ingredients required for such a project to realize its potential.
Firstly, Malaysia still lacks the highly skilled workforce that is required. I don't have hard figures for this; only anecdotal evidence. The best brains know that the market for their capabilities is essentially global (I know there are barriers to the free movement of labour, but that's another discussion) and would tend to move to places where they are given better financial compensation.
Secondly, the culture still has a hostile attitude towards bankruptcy and failure. You see it at many levels; parents who chide their students for "only" getting 7 As in their SPM (national high school examination) instead of 13 or 14 or whatever the newest record is. The people who speak of disclosed bankrupts in hushed whispers. It really does tend to make a lot of potential risk-takers think twice about embarking on their risky activity.
Finally, the venture capital industry is still somewhat underdeveloped. I know the Malaysia Venture Capital Management Berhad (MAVCAP) is making some inroads into this, but it's going to take a while before they fully develop the capabilities that larger international VCs have.
I do believe it is a worthy investment, though. It is, however, one of the things that will take years and years to pay off, if at all.
The "success" of Silicon Valley is being reproduced in different parts of the world - Cambridge in the United Kingdom especially springs to mind. Having spoken with some of the people heavily involved in this project, we determined that there were several key ingredients that made Silicon Valley essentially unique and hard to reproduce.
The superficial similarities are easy to point out - there are quite a large amount of venture capitalists in both places (or easy access to venture capital money), proximity to large research universities. However, the differences between the two locations are telling.
Firstly, as several other posters have described, the attitudes towards bankruptcy can be vastly different. In our study, we looked at differences in attitude between the United States, the United Kingdom and the Netherlands and found that while failure in your first entrepreneurial undertaking is considered almost de rigueur in Silicon Valley, the culture in the UK and the Netherlands tends to be less forgiving. While this is now changing, there are still many people with good ideas who are still worried about taking on high-risk projects because the perceived cost of failure is much higher.
Secondly, the attitude of the VCs and business angels towards companies. For example, we found that VCs in the Netherlands tended to have a narrower scope than VCs in both the United Kingdom and the United States. We spoke to a few large VC firms in the Netherlands and found that many of them invested only in companies whose main base of operations would be in any one of the Benelux countries. Their justification for this being that they felt it lowered their risk profile.
I also believe that Paul Graham might have downplayed the influence of governmental policy on entrepreneurship. While I'm not too sure about the situation in Silicon Valley, certainly in the UK and NL, there are entrepreneurs who view VC financing as a "lender of last resort", as it were. They've heard many stories of how VCs put very restrictive covenants on the way business is conducted, for example the need to sell their stake in the company after a certain amount of years, and they are wary of this before seeking out such financing. The first port of call for money tends to be grants, either from the nearby universities or from the government. These grants have the advantage of being relatively liberal (once you've convinced the committee to give you the money, they maintain a pretty hands off approach to the way you run your business) and are a good way to build value in the company with a very low cost to the founders.
There is also some evidence that rates on personal income tax and capital gains tax can have a strong effect on the rates of entrepreneurship, although I wouldn't want to comment too much on this as I haven't studied this avenue in very much detail. There are, however, papers that go into this in more detail. Notably:
I could go on and on about this, but the point is that this is still an active topic of research and the actual drivers of entrepreneurship can be quite hard to elucidate. There is a very good book that serves as a good launching point for further study in this topic entitled "Clusters of Creativity: Enduring Lessons on Innovation and Entrepreneurship from Silicon Valley and Europe's Silicon Fen" by Rob Koepp. Book is readily available from Amazon.
No, biofeedback training is something I've only heard of in passing so I can't say I know of much good information about it.
:)
If it's something that has to be learnt over the course of a few days though, would it be a very marketable concept in your opinion? My guess is that people will want to pick up a device which they can use straight away, not something they have to train for just to play a game or two.
But if you know a lot more about biofeedback training, you might be able to enlighten me.
When I was a physiology student, we examined saccades - high speed movements of the eye. We do not smoothly transition our field of vision to something interesting, we tend to "snap" our focus instantly to catch a better glance.
Where this was interesting, I thought, would be if we could leverage this mechanism as an input device especially for FPS games. Instant targeting and pretty damned accurate aim.
However, there probably won't be too much of a market outside that though, since smooth and steady movements of the eyes are pretty difficult to achieve, if not impossible.
Not directly relevant to the topic, but you can view some pretty comprehensive salary information at
http://www.h1b.info/lca_search.php
The information from the database is supposedly taken from the details provided by employers filing for H1B visas, so may not 100% reflect what's out there in the market. However, I've been told the amounts pretty much reflect what US citizens would expect to receive anyway.
It's out of fear of situations like you went through that I lead a property-less existence. Besides my computer (which I frankly can't live without), I rent my own home and car. Some people call it stupid since I'm essentially giving away my money and getting nothing in return but, when the shit hits the fan, I'm able to give it all away and live off whatever I have saved until I get a new job. No need to pay off mortgages (hint: just because you lost your job, doesn't mean you don't have to pay off your mortgage anymore) which is quite reassuring.
Hope things have worked out much better for you.
Perhaps not in the USA, but when I was in Britain, I read an editorial about the mobile phone revolution and how it was helping the homeless be more contactable. I'm sure there are at least some of them who do genuinely want to change their lives in the hope of moving out of homelessness. It really isn't a state one would like to live in for long.
I presume resumes for less qualified individuals would be different from what you and I are used to. Who knows - the effort of producing a piece of paper that states the person's skills (even if only the fact they were a star athlete in high school 5 years ago, for example) might give a potential employer enough good vibes to give the person a try. You never know.
Despite criticism that the Bill and Melinda Gates Foundation might have some vested interest in providing public access computers in libraries, I view this as a good thing. Public free access enables a lot of people who otherwise wouldn't be able to participate in online activity - for example, homeless people putting their resumes online in the hopes of finding employment.
In this case, funding came from a foundation started by a private individual. What about in other countries where there isn't so much of a culture of public donations (true, there are robber baron CEOs, but I'm thinking in the lines of the donations given by people like Andrew Carnegie)? Unless there's strong political will, I don't think it's going to happen - beneficial though it is, it looks more like a "nice to have" rather than a "must have".
Just to clarify, I mentioned "taking risks" more as a form of reassurance. The fact is, going back to college involves a significant change of lifestyle and I wouldn't blame anyone for feeling anxiety and trepidation at making such a move. Much less eating out at restaurants (fancy or otherwise) and getting used to ramen instead and car? Pretty much forget it. I guess I am also shaped by the knowledge that I'm from a country which isn't known for solid tertiary education - hence many of us who can tend to leave the country for colleges and universities elsewhere. Needless to say, the amount of debt one incurs is substantial. This may not be the case for all Americans/British/Australians/etc, but I wouldn't be surprised if college cost at least a little something which needs to be paid off at some point?
And I couldn't agree more with your case about doing whatever degree you want in college. Every job that I've done simply used my computer science degree as a talking point during the interview - they wanted to know if I knew my shit, basically. In the name of equal opportunities or what have you, there were also recruits from other backgrounds - e.g. mathematics, business and history. They all did fine after some formal and on-the-job training.
For those (like myself) who have little idea about spintronics, Wikipedia has a general article that seemed to explain it to me quite well. Of course, I'm not a physicist so I have no idea whether or not it's accurate although I'm tempted to find out more from the referenced article. PhysicsWeb has more of the same. Apparently this will have far-reaching implications on RAM and cable bandwidth.
Economy's not going too well, find yourself stuck in a bit of a rut jobwise and would like to move up and out? Go to college and get yourself that degree. Seriously.
A college degree may not necessarily be your passport to riches beyond your wildest dreams but, at the very worst, you could end up exactly where you left off. However, take the time you spend in college to learn a lot of things that you never had the time to learn in 'real life', meet a lot of people, and chances are you'll grow to be a better person (I know college sure taught me a lot of useful life skills).
You're still young, you can still afford to take risks. Do it now so you won't have to regret later.
This isn't anything too new. For kicks, I once searched for "Resume" and "Credit card" on KaZaA and got hundreds of results. Presumably, the trouble is that people sometimes believe that security through obscurity works - or, in the case of KaZaA, a lack of attention leads people to share files they didn't really want to.
Interestingly, I found a text file with all the user names and passwords for brokerage firms, and bank accounts, of the IT director at the firm I was working in. Scary, considering he was supposed to have "15 years in the IT industry".
So I guess main screen no turn on?