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Recession Means Back to Bootstrapping Basics
Tweet Share on Facebook February 5, 2009 Comment (1)Hooray for bootstrapping.
While lots of would-be Neros fiddle, Rome burns. Economic stimulus gets stuck in partisan traffic—pork, or not—and, meanwhile, the job ticker goes steadily down and a credit crunch continues.
The New York Times reported the other day that angel investors are pulling back. And U.S. News's Matthew Bandyk posted yesterday on how venture capitalists are taking a beating. The Small Business Administration backed way fewer business loans last year than the year before. And commercial banks are tightening restrictions.
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Stimulus Plan Ignores Start-Ups at Nation's Peril
Tweet Share on Facebook February 4, 2009 Comment (5)If you were a private investor with a few hundred billion dollars at your disposal, would you pour your money into badly managed companies that were teetering on the brink of collapse?
No, I wouldn't either.
But we do. Our nation's leaders regularly use our tax dollars to bail out companies that no investor in his right mind would buy into without at least a wholesale changing of the management guard and a brand-new business plan.
And what kind of returns can you reasonably expect on those investments? When lawmakers fling money at floundering corporations, they demand nothing. No new management. No new business plan. No new product development. We essentially give them money so that they can continue to do all the things that got them into trouble in the first place, while expecting different results.
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