The Price of Fear

Covid-19 Derails Retirement Plans of Older Small-Business Owners

Via the Wall Street Journal…

“Mr. Dreibelbis is at a crossroads like millions of small-business owners who are at or near retirement age. More than 40% of the 30.7 million who own small businesses are 55 and older, and the majority of them have poured their savings into their shops and companies. Many have been hit by coronavirus closures at a time when they were within a year of selling in order to fund their retirement. They have to decide whether to invest more time, energy and money in businesses they have put their hearts into, or cut their losses. At their age, they don’t have the time to start over.”

“What to do next is not just a financial decision, but an emotional one as well. Many began with a dream and spent decades fulfilling it, raising children along the way, some of whom joined them at the counter or warehouse. They and their business are often a part of the local community and provide jobs and gathering spots for neighbors. Closing that chapter means beginning another one that many associate with their last.”

Read more…

COVID-19 Entrepreneurship Small Business

Establish an Entrepreneurial Edge

What happens after the Great Shutdown?

How to Establish an Entrepreneurial Edge After the Great Shutdown


Entrepreneurs are constantly seeking an edge or an advantage. In fact, most entrepreneurs are wired to look at the world from an opportunist’s perspective and are regularly working an angle, an approach, or a way of attacking a business opportunity that others have missed or have left exposed.

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COVID-19 Entrepreneurship Small Business Starting Over

New Online Ventures

We keep telling you, Start Your Business NOW!

The Covid Quarantine Is Fueling a Boom in New Online Ventures

The Covid Quarantine Is Fueling a Boom in New Online Ventures. Out of work and with more time on their hands, more people are setting up new websites for entrepreneurial endeavors.

Another example of how this can be the best time to start a business, and starting a new business or entrepreneurial effort is likely a much better use of your time than a constant job search or lounging at home collecting unemployment. This also works for bricks and mortar businesses that have limited or no online presence.

From this article from Inc. Magazine: “Until mid-March, Zach Sass was the executive chef at Nashville Underground, a popular tourist spot known for its hot chicken on Music Row in Nashville. Sass, 31, had been a chef for 12 years, working all over the country and putting in 60- to 70-hour weeks. After Covid-19 forced Nashville Underground and other businesses to close, Sass found himself at home with time on his hands.” 

“Sass also needed to figure out a way to earn a living, which is how he came to launch his first website to promote the live cooking classes he’s begun teaching via videoconferencing software. He set up the site with GoDaddy, the Scottsdale, Arizona-based domain registry and web-hosting service. “I’m not savvy when it comes to computers and technology,” Sass says. “I was scared not having any skills.” And yet, he got his site online and has begun teaching online classes, helping people to cook using the ingredients they have on hand in their kitchens and asking for donations between $10 and $100. Much of Sass’s inbound traffic comes from LinkedIn, and he recently started using Google Ads to grow the business.”

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Unemployment Pays

$600 Unemployment Benefits Are Keeping People From Returning to Work, Fed Says – Barron’s, May 28, 2020

“Give a man a fish and he’ll eat for a day. Teach a man to fish and he’ll eat for the rest of his life. Give him an extra $600 a week not to fish, he’ll stay home and open cans of tuna—especially if he can avoid contracting coronavirus and his wife needs help with the children.”

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COVID-19 Small Business

Retail Recovery

The Recovery of Bricks-and-Mortar Retail Will Be Staggered. Here Are the Early Winners and Losers. – Barron’s, May 28,2020 is a location-data analytics company that tracks more than 30 million mobile devices in the U.S.

A year-over-year comparison shows that gyms, hotels and apparel shops have been hit the hardest by the pandemic and likely won’t see an easy recovery even after reopening. Nationwide visits to those three groups of retailers remained down 87%, 79%, and 72% down, respectively, from the same period last year, while superstores like Target (ticker: TGT) and Walmart (WMT), and the grocery sector saw visits up 13% and 6% year-over-year.

The nature of different reopening policies and loosened restrictions, depending on the state, also have a clear impact on how retailers are doing. For instance, Georgia and South Carolina, among the earliest states to reopen in late April, are seeing significantly better recoveries among retailers, while California—where phased reopening didn’t start until the second week of May—is still seeing much less traffic to shops and restaurants.

BusinessFlare Approach COVID-19

Its all about Cash Flow

Restaurants Say Socially Distant Dining Rooms Could Wipe Out Business – Wall Street Journal May 28, 2020

Businesses prohibited from opening were offered PPP loans to pay employees to not work. Unemployment compensation is higher than some workers were making so they aren’t going back to work. Will they have jobs when the dole runs out?

And now, businesses are expected to operate at 25% or 50% capacity, mostly businesses that operate on thin margins. This equals negative cash flow in most cases. Clearly many of these policy makers missed our BusinessFlare® Academy Economic Development for Local Elected Officials class. From our textbook (soon to be available online, in print, and in audiobook!):

“Cash Flow is King – The bottom line for economic development is cash flow. Cash flow is the key to a business’ success, and it is important to remember that there are only two things that improve cash flow: increasing revenues and/or reducing expenses. This is important to remember because there are so many things that a community can do that impact a business’ cash flow including how policies are implemented and what those policies are to begin with.  That said, elected officials have a role that is broader than economic development, and which includes the health, safety and welfare of the community. Therefore, policies will be implemented that have a negative impact on cash flow. In those cases, it is important to understand and respect the impact of policy decisions and implementation of those policies on business cash flow to maintain credibility with the private sector.” – From “Governing for Economic Development

Clearly the last sentence has been ignored in many places.

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COVID-19 Small Business

Small Business Saturday

Good coverage yesterday and today from Barron’s about the nation’s small businesses and their challenges and opportunities.

Rich Rewards. High Risks. Here’s How to Buy a Small Business.

Small Businesses Are the Key to Reviving the Economy. They Face an Existential Threat.

Retailing Is a Jungle That Will Keep Favoring Giants. Mom and Pop, Look Out.

Small Businesses Are in Fragile Shape, Chamber of Commerce President Warns. Here’s What They Need to Survive.

PPP Delayed the Day of Reckoning for Small Business. Now, Time Is Almost Up.

BusinessFlare Approach COVID-19 Investment Drivers

Investment Driver: Land

With Economic Development, ultimately, it’s all about the LAND…

J.C. Penney’s Bankruptcy: It’s All About the Real Estate

Barron’s coverage about J.C. Penney’s expected bankruptcy filing, which will split it in two, with one entity remaining as a retailer, and the land becoming property of a real estate investment trust (REIT). At a time when no one knows the value of that land, at least nor for the moment.

BusinessFlare Approach COVID-19 Investment Drivers

Investment Driver: Capital

Investors Are Worried About Muni Bonds. How to Profit From Others’ Fear.

From Barron’s:

“The municipal-bond market has lagged far behind the recovery in other sectors of the credit markets. Does that present a warning—or an opportunity—for investors?

With top-grade munis offering higher after-tax yields than corporate junk bonds, the answer would appear to be the latter.

State and local government borrowers haven’t gotten the same benefit as corporations from the Federal Reserve, as my colleague Alexandra Scaggs explains . Investment-grade and high-yield corporate bonds have rallied strongly in response to the Fed’s backup, while munis have provided relatively paltry returns.” Read more…

Also from Barron’s – Federal Aid for Cities won’t be Cheap

“The Senate appears more reluctant to write a blank check to states and local governments and is likely to demand the inclusion of provisions to shield businesses and health care providers from coronavirus claims,” McLoughlin and his team wrote. “Enactment of the next round of legislation is likely to be more challenging than the first four.”

Read more…

COVID-19 Entrepreneurship

Venture Capital COVID-Related Information

The National Venture Capital Association has created a webpage with information and resources for venture backed companies about COVID and the federal response to it. This page includes useful information for any business, whether part of the VC community or not.

It includes:

Government Resources

Startups combating COVID-19

NVCA Resources

Additional Resources

Stop the Spread Campaign

News Stories about COVID-19 and Startups