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According to the WSJ, small-business loans are up at many of the nation’s lenders, but business isn’t exactly humming, and growing apprehension about commercial lending could leave a substantial number of firms without a source of capital.
JPMorgan Chase, the parent company of Chase Bank and Washington Mutual, said it issued about $1.5 billion in loans to 4,177 small businesses with revenues up to $10 million during the second quarter, up 32% over the first quarter.
However, lending is still 60% of what it would be in a normal economy, according John Asbury, the executive vice president of business services at Regions Financial, even though that is an improvement from the 50% it was at last year. To read the whole article, and to read about how the SBA is dragging it’s feet, click here.
Most people are aware of the rise in corporate bankruptcies (bankruptcies have increased 22% August 09 over August 08), but some of the names on the list are still jarring. We’ve watched financial companies like Lehman Borthers and WaMu go bankrupt, but check out the 10 big companies Yahoo predicts are headed towards bankruptcy:
1. Hertz
2. Textron
3. Sprint Nextel
4. Macy’s
5. Mylan
6. Goodyear
7. CBS
8. Advanced Micro Devices
9. Las Vegas Sands
10. Interpublic Group
The list spans industries and geographies To read the whole article, and more information about each company, click here.
Congratulations to John Hayes, founder of FTRANS, and the FTRANS team for winning TechAmerica’s 2009 Spirit of Endeavor Award for Outstanding Leadership!
I enjoyed having the opportunity to represent FTRANS on an innovation panel for one of the Technology Association of Georgia’s (TAG) monthly meetings. As residents or visitors to Atlanta know, rain @ rush hour + cars = gridlock. Despite this equation in full force, we had a nice turnout.
Takeaways: Companies, big and small, are “innovating” during this downturn, and there are no lack of “quality” ideas in companies both big and small. Yet, technological innovation has difficulty “boiling up” through larger organizations without internal champions and an environment that facilitates some level of entrepreneurship and/or independence. Inversely, smaller companies are often distracted by too many good ideas. As fellow panelist Elaine O’Gorman of Progility Partnersobserved, too many entrepreneurs waste time, energy, and capital “keeping too many options on the table” rather than focusing on their core products/markets. In either case, a defined innovation process can facilitate putting the “right” options on the table and the “wrong” ones on the chopping block.
For those small businesses that desire to partner with larger organizations, our fellow panelist, Michael Mullineaux of Nokia Siemens Networks(NSN) pointed out that many large organizations such as NSN actively seek engagement with smaller organizations which may have innovative technologies. He observes that many large organizations have dedicated teams constantly scanning the environment for technology partnership opportunities–seek them out.
For more discussion on innovating during a downturn, listen to this podcast at Businessweek.com by Darrell Rigby, Bain’s ”Downturn Strategist.” Question: Has Downturn Strategist, Darrell, worked himself out of a job?
Should businesses invest in innovation during an economic downturn? To discuss, join us on Wednesday, September 16, at the Southeastern Software Association meeting where Jim Lester, VP of Marketing and Product Management, will be a panelist discussing the topic: “Taking Advantage of the Economic Downturn by Investing in Innovation”
As a venture capital backed small business, this topic is certainly relevant to us and our investors. It is also relevant to our customers. This relevance is paramount, because our company is committed to reducing friction in the way small businesses access capital. The macroeconomic environment has further exposed the financing challenges faced by these businesses. Thus, to the extent we innovate during this downturn and find a better way to address this issue, we (our customers and partners included) will be successful. For a good read on the subject of innovation, we recommend Clayton Christensen’s book, “The Innovator’s Dilemma.”
