Dr. Diane Hamilton's Blog

The PayPal Mafia: What is a Serial Entrepreneur?

The PayPal Mafia refers to a group of individuals who created multiple companies that created a frenzy of growth in the Silicon Valley.  The entrepreneurs created PayPal before they set out to develop other multiple successful technology-based companies.  These men are serial entrepreneurs or individuals who, “continuously come up with new ideas and starts new businesses. As opposed to a typical entrepreneur, who will often come up with an idea, start the company, and then see it through and play an important role in the day to day functioning of the new company, a serial entrepreneur will often come up with the idea and get things started, but then give responsibility to someone else and move on to a new idea and a new venture.”

To learn more about some of the individuals associated with the PayPal Mafia check out the following members and how their initial success led to other serial successes:

For a more complete list of the PayPal Mafia members and their accomplishments, click here.

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Linkedin Endorsements Poorly Utilized

 

Linkedin has provided an opportunity for networkers to endorse the skills of people with whom they are connected.  This was meant to be a time saver for people who normally wrote full recommendations. The idea had promise.  However, it is not being utilized well.  When users sign onto their Linkedin profile, they are given a list of people in their network and asked if they want to endorse them for a particular skill. There is the option of being able to endorse all of the people that pop up as choices.  The problem is, many people are doing that.  People may receive many endorsements from people who have not witnessed some of the skills they have endorsed.  At that point, the Linkedin endorsements become meaningless.

It is far too easy to choose the option of endorsing people as it is currently configured.  If the point was to make recommendations easier, it is understandable that there should be some way to do that.  However, if everyone is endorsing everyone for everything, there is no value to the endorsement.

To find out more about Linkedin’s Endorsements check out the following articles

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Apple and Other Top 10 Company Financial Statements

 

With all of the reports about the successes and failures of IPOs in 2012, there may be renewed interest in deciphering financial reports.  The follow are explanations of the four major financial statements.

  1. Income Statement:  One of the most important reports for a company is their Income Statement.  This may be referred to as the Statement of Income or the Profit and Loss Statement. This report shows profits and losses over a specific period of time.
  2. Balance Sheet:  The balance sheet is also referred to as the Statement of Financial Position. The balance sheet displays a company’s position at a single moment in time.
  3. Cash Flow Statement:  This may also be referred to as the Statement of Cash Flows. The Cash Flow Statement shows information about how money flows in and out of a business.  This may be helpful in determining the viability of a company.
  4. Statement of Retained Earnings:  This may also be referred to as e Statement of Changes in Equity.  This statement explains the company’s retained earnings over a period of time.  This will be reported under shareholder’s equity on the balance sheet.

The following are examples of the top 10 company financial statements:

Income Statements:

Balance Sheets:

Cash Flow Statements:

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LinkedIn vs. Facebook IPO Success

 

LinkedIn’s recent IPO performance appears to have crushed the perception of big named company IPOs from Facebook, Yelp, Zynga, Groupon and Pandora. Based on their recent closing price, LinkedIn is up 141%. According to BusinessInsider Linkedin is, “the best-performing IPO this year by a huge margin. The next closest competitor, Bankrate, is up about 28 percent from its initial public offering.”

Timing may have been a factor for LinkedIn’s success. They have also seen consistent growth in unique visitors. Investors waiting for highly anticipated IPOs like Facebook may have helped increase the success of LinkedIn as well.

Although Facebook has had a lot of negative press regarding its IPO, CBS news reported that Facebook’s IPO was actually a success. CBS explained, “LinkedIn (LNKD) shares popped from the start in the professional networking company’s 2011 IPO and more than doubled in the first few days.”  Investment bankers made a bundle. This led people to think Facebook had been a flop. However, CBS author Allan Roth explained, “my definition of a successful launch of a new publicly traded stock doesn’t rest on how much money the investment bankers make. It rests on how close the offering price is to where the stock actually trades. The fact that Facebook shares closed at nearly their offering price tells me that that investors thought it was fairly priced. That’s pretty amazing, in my view, given all the hype over Facebook.”

Colin Lokey from SeekingAlpha explained that when comparing Facebook to Linkedin, fundamentals show that Linkedin is overvalued. Lokey warned, “Investors should of course, keep in mind that the fact that LinkedIn is far too expensive doesn’t mean Facebook is fairly valued at half of LinkedIn’s price.”  Prices have been affected by the recent Facebook IPO. Yahoo’s Finance writer Jeff Macke did not share Lokey’s opinion on pricing when he stated, “Linkedin stock has been dragged down over the last few weeks by the undercurrent of the Facebook Titanic.” He sees LinkedIn as a “screaming buy”.

Only time will tell how well LinkedIn and Facebook will perform. BizJournals recently quoted Linkedin’s CFO Steve Sordello about the importance of a company’s IPO results. “”An IPO is a one-time event, and what really matters is the long term. If it rains on your wedding day, you’re going to remember it rained but it’s not going to influence the marriage.”

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Top 10 Entrepreneurs Who Hit it Big Before Turning 35

 

There was a time when it was unusual to hear about an entrepreneur becoming successful at a very young age.  With the technology boom, the story is becoming more commonplace.  The following list contains the top 10 entrepreneurs whose dreams came to fruition and made them very rich before they hit the ripe old age of 35.

  1. Apple – Creators:  Steve Jobs and Steve Wozniak.  Apple was established in 1976, the year Steve Jobs turned 21 and Steve Wozniak turned 26.
  2. Amazon – Creator:  Jeff Bezos.  Amazon was founded in 1994, the year Jeff Bezos turned 30.
  3. Disney – Creator:  Walt Disney.  Disney was founded in 1923, the year Walt Disney turned 22.
  4. Facebook – Creators:  Mark Zuckerburg and his college roommates Eduardo Saverin, Dustin Moskovitz and Chris Hughes. Facebook was launched in 2004, the year that Mark Zuckerburg turned 20.
  5. Google – Creators:  Larry Page and Sergey Brin.  Google was incorporated in 1998 the year that Larry Page and Sergey Brin turned 25.  Google’s IPO was in August of 2004, the year the men turned just 31.
  6. Groupon– Creator:  Andrew Mason.  Groupon was created in 2008, the year Mason turned 29.
  7. LinkedIn – Creators:  Reid Hoffman and founders from PayPal.  LinkedIn was founded in late 2002 the year that Hoffman turned 35.
  8. Microsoft – Creators:  Bill Gates and Paul Allen.  Microsoft was established in 1975, the year Bill Gates turned 20 and Paul Allen turned 22.
  9. Twitter – Creator:  Jack Dorsey.  Twitter was created in 2006, the year Dorsey turned 30.
  10. Yahoo! – Creators: Jerry Yang and David Filo.  Yahoo! was incorporated in 1995, the year that Jerry Yang turned 27 and David Filo turned 29.

Click on the company names above to find out more details and top stories about these unique companies.

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