Some Puzzling Questions about Innovation in the Digital Economy

March 4, 2014 Leave a comment

February 28, 2014, 12:32 PM ET

Some Puzzling Questions about Innovation in the Digital Economy

By Irving Wladawsky-Berger

Guest Contributor

This semester I am teaching the innovation half of a course on Entrepreneurship and Innovation at New York University’s new Center for Urban Science and Progress. Teaching forces you to take a fresh look at the subjects you are covering, so I find myself revisiting questions I’ve long been thinking about:  What is the essence of innovation in the digital economy and how does it differ from the industrial age innovation of the past 200 years? Read more of this post

Filed under TMT Trends

Pork Bellies and Public Company Audits: Have Audits Once Again Become Just Another Commodity?

March 4, 2014 Leave a comment

Pork Bellies and Public Company Audits: Have Audits Once Again Become Just Another Commodity?

Brant E. Christensen 

Texas A&M University – Department of Accounting

Thomas C. Omer 

University of Nebraska at Lincoln – School of Accountancy

Nathan Y. Sharp 

Texas A&M University – Department of Accounting

Marjorie K. Shelley 

University of Nebraska at Lincoln – School of Accountancy
October 8, 2013

Abstract: 
Prior research has established that from 2000 to 2007, auditors recognized clients’ financial reporting risk and incorporated that risk into their audit fees (Charles et al. 2010; Doogar et al. 2010, 2012). However, regulators have expressed concerns about the impact of the subsequent economic downturn and resulting fee pressure on auditor effort. We provide evidence of a marked decline in auditors’ pricing of financial reporting risk during the 2006-2010 period, suggesting auditors have been unable to sustain their focus on the risk of misreporting in recent years. This decline is particularly evident among non-industry expert auditors. Additionally, we find higher rates of financial statement restatements among high-risk clients where their risk appears not to be incorporated in audit fees. Our results are consistent with a return to the commoditization of financial statement audits and its negative impact on audit quality.

Filed under Investing Process

Falling Audit Fees May Increase Restatements: Study

March 4, 2014 Leave a comment

February 28, 2014, 3:18 PM ET

Falling Audit Fees May Increase Restatements: Study

By Saranya Kapur

Reporter

Audit fees have sagged since the recession, and that trend may increase the possibility of misstatements going undetected, according to a study by researchers at Texas A&M University and University of Nebraska-Lincoln. Read more of this post

Filed under Macro Trends

Microsoft CEO Satya Nadella Has ‘High Customer Empathy,’ Says Former Boss

March 4, 2014 Leave a comment

February 28, 2014, 3:57 PM ET

Microsoft CEO Satya Nadella Has ‘High Customer Empathy,’ Says Former Boss

By Clint Boulton

Reporter

When Microsoft Corp.’sMSFT +1.19% board picked Satya Nadella as the company’s next CEO, many people talked about his 20-plus years at Microsoft, his engineering skills, and his success building the Azure cloud business. But CIOs might like to know that the company’s new chief, who succeeded Steve Ballmer on Feb. 4, has a good ear for customer needs, says a former boss. Read more of this post

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Do ETFs Turn Investors Into Market Timers?

March 4, 2014 Leave a comment

Do ETFs Turn Investors Into Market Timers?

MARK HULBERT

Feb. 28, 2014 9:19 p.m. ET

There is a downside to how cheap and easy exchange-traded funds make it to buy or sell broad baskets of stocks: the danger of becoming a short-term market timer, a losing proposition for most individual investors. Read more of this post

Filed under Macro Trends

The Job After Steve Jobs: Tim Cook and Apple; From the moment he became CEO of Apple, Tim Cook found himself in the shadow of his boss

March 4, 2014 Leave a comment

The Job After Steve Jobs: Tim Cook and Apple

From the moment he became CEO of Apple, Tim Cook found himself in the shadow of his boss

YUKARI IWATANI KANE

Feb. 28, 2014 8:40 p.m. ET

Author of “Haunted Empire, Apple After Steve Jobs”, Yukari Kane discusses what she’s learned about Tim Cook, Apple’s evolving relationship with its suppliers, and whether or not she believes Apple has lost it’s way since Steve Jobs’ death. Read more of this post

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Almost Half a Billion Worth of Bitcoins Vanish; Mt. Gox Says It Lost 750,000 of Customers’ Bitcoin to Fraud

March 4, 2014 Leave a comment

Almost Half a Billion Worth of Bitcoins Vanish

Mt. Gox Says It Lost 750,000 of Customers’ Bitcoin to Fraud

ROBIN SIDEL, ELEANOR WARNOCK and TAKASHI MOCHIZUKI

Updated Feb. 28, 2014 7:16 p.m. ET

image001 image002-1

Mt. Gox CEO Mark Karpeles bows in apology at a news conference at the Justice Ministry in Tokyo.Associated Press

Mt. Gox, once the dominant exchange for bitcoin trading, on Friday said more than $470 million of the virtual currency vanished from its digital coffers, kicking into high gear a search for the missing money by victims and cybersleuths. Read more of this post

Filed under Macro Trends

Do Performance Incentives Backfire? New research suggests that they can, but whether they do or not, they’re tricky tools.

March 4, 2014 Leave a comment

February 28, 2014

CFO.com | US

Do Performance Incentives Backfire?

New research suggests that they can, but whether they do or not, they’re tricky tools.

David McCann

In a previous career incarnation when I supervised people, I exhibited several behaviors that weren’t covered in Management 101. I treated each person differently, tried to make friends with everyone, tolerated insubordination, gave perversely glowing reviews to mediocre performers and delegated only when supremely necessary. Read more of this post

Filed under Life

Five Years Later, an Over-the-Top Wall Street Blog Returns; The blog evolved naturally from the short parodies he would write that were loosely based on his friends’ conversations

March 4, 2014 Leave a comment

FEBRUARY 28, 2014, 11:31 AM  Comment

Five Years Later, an Over-the-Top Wall Street Blog Returns

By SYDNEY EMBER

Like many in the fall of 2008, Amit Chatwani was done. Lehman Brothers had collapsed, the government had bailed out the American International Group, and the financial system was in chaos. Read more of this post

Filed under Macro Trends

Apple CEO promises new products, says Apple TV no longer a ‘hobby’

March 4, 2014 Leave a comment

Apple CEO promises new products, says Apple TV no longer a ‘hobby’

4:27pm EST

By Alexei Oreskovic

CUPERTINO, California (Reuters) – Apple Inc sold more than $1 billion of Apple TV set-top boxes in 2013 and is investing heavily in the next generation of products, Chief Executive Tim Cook said at the company’s annual meeting on Friday. Read more of this post

Filed under TMT Trends

Bitcoin true believers unfazed by losses in Mt. Gox collapse

March 4, 2014 Leave a comment

Bitcoin true believers unfazed by losses in Mt. Gox collapse

11:26am EST

By Kevin Krolicki and Nathan Layne

TOKYO (Reuters) – Like other bitcoin evangelists, Ken Shishido is ready to write off the money he lost in the bankruptcy of Tokyo-based virtual currency exchange Mt. Gox as the price of revolutionizing global finance. Read more of this post

Filed under Macro Trends

A Purpose Beyond Profit

March 4, 2014 Leave a comment

LIFE@WORK FEBRUARY 28, 2014, 3:52 PM  Comment

A Purpose Beyond Profit

By TONY SCHWARTZ

For years, I’ve listened to chief executives of large companies pay dutiful lip service to concepts like corporate social responsibility, investing in the communities they operate in, treating employees as their most precious asset and living their values. Mostly, it comes off as so much canned public posturing — boxes to be checked off, rather than any sort of deep commitment. Read more of this post

Filed under Life

Chronically ill facing high drugs costs under U.S. health law

March 4, 2014 Leave a comment

Chronically ill facing high drugs costs under U.S. health law

10:50am EST

By David Morgan

WASHINGTON (Reuters) – President Barack Obama’s ban on discriminatory health insurance practices against the sick has not stopped insurers from increasing up-front charges for the expensive drugs needed to control chronic illnesses from leukemia to multiple sclerosis. Read more of this post

Filed under Health

Paper Warns of Exodus From Emerging Market Bond Funds in system-rattling “bond market tantrum,” as across the board selling by market heavyweights such as Pimco prompt others to follow suit

March 4, 2014 Leave a comment

FEBRUARY 28, 2014, 10:36 AM  2 Comments

Paper Warns of Exodus From Emerging Market Bond Funds

By LANDON THOMAS JR.

Low interest rates have incited a craze for risky bonds in fast-growing economies, and few fund companies have been more adept in meeting this demand than Pimco, the world’s largest bond manager. Read more of this post

Filed under Macro Trends

Autodesk Has Designs on New Business Model: The shift to subscription-based pricing should pay off in the long term.

March 4, 2014 Leave a comment

Autodesk Has Designs on New Business Model

The shift to subscription-based pricing should pay off in the long term.

By Andrew Lange | 02-28-14 | 06:00 AM | Email Article

After fully digesting  Autodesk‘s (ADSK) fiscal 2014 results, we have taken a fresh look at the firm’s strategic business model transition and what it ultimately means for the company over the long term. While the company’s financial performance will be underwhelming (relatively speaking) in the short term given revenue recognition changes, we think Autodesk is well placed to benefit from its shift to more subscription-based, higher long-term value pricing models. We expect revenue growth to converge with 12% billings growth in fiscal 2018. Additionally, we forecast considerable operating margin expansion given the business model transition, with 30% non-GAAP operating margins in fiscal 2018, in line with guidance. In all, we have rolled our financial model forward one year, have become more confident in Autodesk’s ability to migrate clients to subscription-type pricing models, and see good spending across the company’s core markets. As a result, we have increased our fair value estimate to $51 per share from $38 and retain our Wide Economic Moat Rating. Read more of this post

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Taking on the tele-garchs: Just as America bust its trusts a century ago, so Mexico needs to take on its near-monopolies in TV and telecoms

March 4, 2014 Leave a comment

Taking on the tele-garchs: Just as America bust its trusts a century ago, so Mexico needs to take on its near-monopolies in TV and telecoms

Mar 1st 2014 | From the print edition

IN HIS second year in office President Enrique Peña Nieto of Mexico is admirably keen to develop a reputation as a cartel-killer. In December his reforms stripped Pemex, the state oil firm, of its 75-year monopoly. Last month he sent a bill to Congress raising the maximum jail sentence for anticompetitive behaviour to ten years. (He has even made some headway against the relentless drug cartels, as the capture on February 22nd of Joaquín “El Chapo” Guzmán, Mexico’s most-wanted kingpin, attests—see article.) Read more of this post

Filed under TMT Trends

Chaebol and ‘owner risk’

March 4, 2014 Leave a comment

2014-02-28 17:20

Chaebol and ‘owner risk’

The Supreme Court sent its strongest warning ever to Korea’s family-run conglomerates Thursday, upholding four-year and three-and-a-half year prison terms for two brothers who control the nation’s third-largest chaebol, SK Group.   Read more of this post

Filed under Macro Trends

Subway bets on Korean market; Since its entry into Korea in 2007, the firm has continued on a growth trend. It posted 20 billion won in sales

March 4, 2014 Leave a comment

2014-02-27 21:16

Subway bets on Korean market

By Park Ji-won

Subway Korea aims to expand its market presence here by diversifying its menu lineup to compete with McDonald’s and Lotteria, the company’s chief executive said. Read more of this post

Filed under Macro Trends

‘One million buyers have never seen a rate rise’; Building society boss warns of a ‘whole generation’ who have never experienced rising mortgage costs

March 4, 2014 Leave a comment

‘One million buyers have never seen a rate rise’

Building society boss warns of a ‘whole generation’ who have never experienced rising mortgage costs

By Nicole Blackmore

10:11AM GMT 28 Feb 2014

The chief executive of Britain’s biggest building society has made a stark warning that a “whole generation” of borrowers have never had to cope with a rise in interest rates. Read more of this post

Filed under Macro Trends

Bamboo Innovator Weekly Insight – The KS Way to Scale Up a Compounder: The Case of WhatsApp, Phison and Naver

March 4, 2014 Leave a comment

Dear Friends and All,

 

The KS Way to Scale Up a Compounder: The Case of WhatsApp, Phison and Naver

 

“I want to do one thing, and do it well.. On the internet there is a lot of flash and fad. What we are trying to build here is a long-term persistent sustainability.. The simplicity and utility of our product is really what drives us. We won’t stop until every single person on the planet has an affordable and reliable way to communicate with their friends and loved ones.. People starting companies for a quick sale are a disgrace to the Valley. If you run a startup and your goal is to get on techcrunch, you are doing it wrong. Next person to call me an entrepreneur is getting punched in the face by my bodyguard. Seriously. ”

– Jan Koum, WhatsApp founder

 

“We are our own worst enemy. We have to be patient and concentrate on the things we are doing.. The first question I asked them was, why do they want to create their own startups and be an entrepreneur. About 70% of them immediately replied me that they want to be rich. If that is the case, then I believe that 99% of them will fail.”

– KS Pua, CEO of Taiwan-listed Phison Electronics

 

How can 55 full-time employees (32 engineers) handle more than 19 billion messages and simultaneous connections per day (50 billion across seven platforms), equivalent to the total worldwide volume of SMS text messages, with speed, reliability and few technical errors (99.9% uptime)? Disruptions under load – whether coming from hardware failures (servers, network gear), software breakdowns or management misadventures in serving the growing user population base – has prevented the scalability of business model as the business grows bigger. The value destruction risk that comes from limitations in scaling up the core business inevitably diverts the attention of entrepreneurs to seek alternative growth paths, often self-dealing ones, resulting in fads and fashion in the business and tech world with no genuine compounders to last the distance in a bubbly valuation playground. Read more of this post

Filed under Bamboo Series

The wine business is ripe for disruption, and this man is doing it

March 4, 2014 Leave a comment

The wine business is ripe for disruption, and this man is doing it

By Jason Karaian @jkaraian 5 hours ago

“There are only two important people in the wine business—the winemaker and the wine drinker. Right now, they’re both getting screwed.” Read more of this post

Filed under Life

Bitcoin ATMs Open in Singapore even as the once-dominant Mt. Gox exchange said it was filing for bankruptcy protection

March 4, 2014 Leave a comment

Feb 28, 2014

Bitcoin ATMs Open in Singapore

By Newley Purnell and Lorraine Luk

Bitcoin machines began operating in Singapore and Hong Kong even as the once-dominant Mt. Gox exchange said Friday it was filing for bankruptcy protection. Read more of this post

Filed under Macro Trends

For years China has been billed as the world’s manufacturing powerhouse but the nation’s massive manufacturing industry generates only thin margins due to its inability to turn out key components and parts

March 4, 2014 Leave a comment

Lack of R&D means thin profits for China’s smartphone makers

2014-02-26

For years China has been billed as the world’s manufacturing powerhouse but the nation’s massive manufacturing industry generates only thin margins due to its inability to turn out key components and parts, as typified by the status of its mobile-phone industry. Read more of this post

Filed under Macro Trends

China to be No.1 corporate bond market but defaults a possibiity

March 4, 2014 Leave a comment

China to be No.1 corporate bond market but defaults a possibiity

Staff Reporter

2014-02-28

China’s economic slowdown has brought severe tests to the operation of various industries in the country, especially those featuring high-leveraged operations, notably power generation and construction materials, as their debts doubled their equity capital as of the end of September 2013. Read more of this post

Filed under Macro Trends

Uni-President eats into Master Kong’s instant noodle market share

March 4, 2014 Leave a comment

Uni-President eats into Master Kong’s instant noodle market share

Staff Reporter

2014-02-27

At the end of 2013, the battle between Uni-President China Holdings and its main rival Tingyi Holdings, the largest instant noodle producer in China which sells under the Master Kong brand, began to heat up. Read more of this post

Filed under Innovation

Debt and a lost generation; They are happy to enjoy today, live in a comfortable home, drive a nice car and pay later.

March 4, 2014 Leave a comment

Debt and a lost generation

They are happy to enjoy today, live in a comfortable home, drive a nice car and pay later.

Feb 28,2014

One of my college friends has always been peculiar. Although he graduated with a humanities degree, he got a banking job. He said he had a dream, which was to borrow millions, or billions if possible, and use them up and die without ever repaying them. I laughed at his joke. But then he suddenly turned dead serious. He had his own philosophy behind this bizarre so-called dream. “What is capitalism anyway?” he asked. “It breeds on credit. Credit builds when one borrows more. The credit could be limitless if one borrows and repays well. You will see. One day, everyone will live on debt. The day will come when the biggest beneficiary will be the one who manages debt well.” Read more of this post

Filed under Macro Trends

The absence of SK Group Chairman Chey Tae-won is likely to have a significant impact on the nation’s third-largest conglomerate, leading to what could potentially be the longest management vacancy since the group’s establishment

March 4, 2014 Leave a comment

SK Group’s future uncertain with Chey in jail

Stock prices rose despite risk

Mar 01,2014

The absence of SK Group Chairman Chey Tae-won is likely to have a significant impact on the nation’s third-largest conglomerate, leading to what could potentially be the longest management vacancy since the group’s establishment.
The Supreme Court on Thursday confirmed a four-year prison sentence for Chey, who was convicted of embezzling corporate funds for personal gain. Read more of this post

Filed under Macro Trends

The only way to survive the years of struggle required to master something is to do what you love. You must develop the discipline to ignore the distractions of the modern era if you ever want to be great

March 4, 2014 Leave a comment

FEBRUARY 28, 2014 by ERIC BARKER

Seduction, Power and Mastery: 3 Lessons From History’s Greatest Minds

What can we learn about human nature and the way the world works from reading history? This has been the territory of Robert Greene. Read more of this post

Filed under Life

What More Than 630 Startups Have Taught Paul Graham

March 4, 2014 Leave a comment

What More Than 630 Startups Have Taught Paul Graham

BY LAURA MONTINI

Y Combinator founding partner Paul Graham spoke recently at a conference, revealing more about why he’s leaving and what he’s learned. Read more of this post

Filed under Life

The Rise And Future Of The New York Startup Ecosystem

March 4, 2014 Leave a comment

The Rise And Future Of The New York Startup Ecosystem

Posted 20 minutes ago by Nick Beim (@NickBeim)

Like many who have been active in the New York startup ecosystem over the past decade, I am optimistic about its future. The last 10 years have seen an increasing number of startup successes in New York. Read more of this post

Filed under TMT Trends

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