Small Talk: Jobs data contradictory

Over the last week there have been some wins and losses for small businesses in terms of new job data.

On the win side of the ledger, a new Intuit survey shows 44 percent of small businesses say they plan to hire in the next 12 months. The data is included in a San Francisco Chronicle story profiling a local Web startup – Airbnb.com – that is doing its part, having hired seven people since April, at a time when national unemployment has reached a 26-year high of 10.2 percent.

But that optimism is tempered by a USA Today story that said the main reason the unemployment rate jumped in October was due primarily to small businesses cutting staff. It seems that while some small companies are starting to hire again, they are still outnumbered by the ones laying off their workers. The story quotes Moody’s economist Mark Zandi, who explained there is a bias towards big companies in how the Labor Department compiles its payroll survey, which showed October job losses were down nearly 50 percent (190,000) from the average of 357,000 in May, June and July.


Small businesses are trimming staff, because many of them can’t get the loans they need to stay afloat until the economy picks up again. The Obama administration is ramping up efforts to get more money into the hands of small business owners, but the President’s efforts have been hamstrung by the bankruptcies of two of the country’s biggest small-businesses lenders: CIT and Advanta.

CIT lends to more than a million U.S. small businesses, while Advanta – a small business credit card lender – is trying to collect close to $3 billion in outstanding loans to 360,000 clients. The idea of both CIT and Advanta calling in markers has sent small businesses into a panic. The filings, which came just a week apart, may well be why Obama has chosen next week to stage a small business forum in Washington, in which U.S. Treasury Secretary Tim Geithner and Small Business Administration head Karen Mills will engage small business owners on the best way to get them more financing.

The VC gender gap: are VCs sexist?

Jeff Bussgang

– Jeff Bussgang is a General Partner at Flybridge Capital Partners, an early-stage venture capital firm in Boston. This post originally appeared on Bussgang’s blog www.seeingbothsides.com. The views expressed are his own. –

I find the preponderance of males in VC an annoying and stubborn phenomenon. When I first entered the start-up game as an entrepreneur in the mid 1990s, I didn’t think much of the “VC gender gap” as there were plenty of women executives around. In fact, between one third and one half of the executive teams at my two start-ups (Open Market and Upromise) were women.

As the father of a capable, ambitious daughter, perhaps I’m over-sensitive to the issue, but since becoming a VC seven years ago, I find it amazing that only 5-10 percent of the VC industry is made up of women. Only 25 percent of all VC partnerships have a single women partner and only 7-8 percent has more than one women partner. Anecdotally, even fewer women are “management company GPs” as opposed to “employee GPs” – in other words, true owners of VC funds as opposed to deal partners. What other major industry remains 90-95 percent male-dominated? What’s the deal?

A “silver lining” for entrepreneurs?

cloudsA new study shows that bear markets and recessions can actually be good times to start a new company.

The report, produced by U.S.-based entrepreneurial think-tank the Kauffman Foundation, suggests that despite the widespread pain felt during tough economic times, an “entrepreneurial silver lining” can encourage long-term business growth and job creation.

In fact, the authors of the report found that more than 50 percent of the companies on this year’s Fortune 500 list and just under half of those on Inc.’s 2008 list of fastest-growing companies were started during a recession or bear market.