Selecting Your Work At Home Business Opportunity

I started looking for a viable work at home business opportunity back in 2001. It was a time consuming process, but in retrospect, I give myself a pat on the back every month when I cash the check from my home based business. The purpose of this article is to perhaps help others make their selection with a little less time and effort than I expended.

Having spent years running "bricks and mortar" type businesses, I didn't buy for one minute the heavily hyped, or worse yet, home business scam operations that touted the instant riches that could be achieved (often with little effort required). While doing research as to which business I would eventually pursue, this type of claim became an instant trigger to move on to check out some other "business opportunity".

I mean, give us some credit, if those claims were close to being true, why would they share their "secret business formula" with us? They would just execute their "magic system" and in short order have made all the money that exists in the world... get real!

In the course of my investigations, a few other natural filters surfaced to help narrow down the realistic and legitimate home based business opportunities from among the numerous unfounded offers. Early on, I determined that the "get in on the ground floor" offers were essentially smoke. After all, if I wanted to take a chance on the lottery, I would have purchased a ticket. Because of my business management experience, it soon became clear to me that three of the primary factors that would influence my choice would be:

*successful longevity (how long has this company been successfully doing business?)

*reasonable income expectations touted by the top management of the company offering the work from home opportunity.

*support systems and training resources available to help the participants succeed.

One thing that really struck home with me was a statement made by the founder of the company that I eventually selected for my home based business. It went something like the following:

"Hardly a day goes by that I don’t hear from an affiliate questioning why he or she is not seeing a big check yet. More times than not, the person asking hasn’t even been involved for more than 90 days and is only barely beginning to even understand how the whole system works. And frankly, even if the number was six months, it’s still much too early to be expecting a significant income stream to have developed.

I always say that if you’re not willing to give a business at least a year, don’t even bother getting involved. You need to understand that it takes time to get to know all the nuances of the compensation plan. It takes time to determine which products you want to lead with. It takes time to develop a game plan. It takes time to figure out what marketing activities deliver the biggest bang for the buck. Anything worthwhile takes sustained effort. If you’re not thinking long term, you’ve set yourself up for failure."

To sum it up, the selection process should focus on reality (there is no "magic" in home based businesses) and reject any so-called "home based business opportunities" that seem too good to be true.

Kirk Bannerman operates a successful home based business and resides in California. For more details, visit his website at http://business-at-home.us

Vicarious and Limited Liability

Call me crazy, but the idea that society is willing to impose liability on one party for the acts of another is fascinating to me. Of course, it isn't just that we are willing to do this, but rather trying to figure out when we are willing to do this. Today, while I was substitute teaching for a colleague in Business Organizations, I discussed a recent New Jersey case in which a "rogue" law firm partner committed malpractice and stole client funds. In addition, this partner lied on a malpractice insurance application, and the insurance provider was attempting to rescind the policy. The case is complex, but it boiled down to a question of whether the malpractice insurance provider should be bound to a policy that was issued based on a misrepresentation by the rogue partner. On the one hand, this seems like a simple question of agency law. Every partner is an agent of the partnership; therefore, the agent's actions are the partnership's actions; therefore, the partnership cannot be protected by the policy because it was obtained under false pretenses.

But the trial court in this case had an interesting take on this issue, concluding that we should not punish all of the partners by rescinding the policy when only one of the partners lied. This reasoning would result in the insurance company -- rather than the law firm partnership -- bearing the burden of the partner's wrongdoing. The possible responses to this are many. We might say that the "innocent" partners should be more careful in selecting their fellow partners. Or that they are not really so innocent because they should have been monitoring the rogue partner more closely. We might also argue that they received the benefit of the agency relationship and now they must bear the burden.

All of these are perfectly acceptable responses, and the appellate court seemed to embrace this line of reasoning, ruling that the policy should be rescinded. But then add this fact: the law firm partnership was a limited liability partnership. As a result of this decision, the insurance company is off the hook. And the innocent partner is exposed only to the extent that he had money invested in the partnership. If the obligation exceeds the partnerships assets -- which appears to have been true in this case -- the big loser will be the third party, who suffered a loss, but now has no possibility of full compensation.

All of this makes me wonder again about the interplay of vicarious liability and limited liability. Does our current allocation of burdens make sense? Something tells me it doesn't, but I need to do more work on this before I can be sure.

Social Entrepreneurship

Everyone seems to be talking about "social entrepreneurship" (including me, now). The term has been around for some years, but it is still new enough that we feel the need to describe what it means. Most people distinguish social entrepreneurship from socially responsible governance, though the two are closely related. Here is an excerpt from a recent paper by Mary Gentile published by the Aspen Institute:

Social impact management [socially responsible governance], on the one hand, attends to the impacts of traditional business activity on its wider societal context, making visible the often unseen, uncounted or unreported consequences of business practice on a wider set of actors over a longer time frame than is usually examined. It looks at the costs and benefits imposed by business on the quality of life of those both within and outside the firm, such as wealth creation and distribution, skill and technology transfer, environmental impacts, human rights issues, working conditions, and so on.

Social enterprise [social entrepreneurship] initiatives, on the other hand, consider more effective and efficient ways of responding to existing societal needs—either through nonprofit organizations adopting traditional business methods or through partnerships between the private and the social sectors—without necessarily taking into consideration whether existing business practices are contributing to these needs in the first place.

Universities have started to focus on social entrepreneurship. For example, Stanford Business School has formed a Center for Social Innovation; Harvard Business School has an Initiative on Social Enterprise; Columbia Business School has a Social Enterprise Program; and the Fuqua School of Business (Duke) has a Center for the Advancement of Social Entrepreneurship. I am sure there are many others, but you get the idea. And there are certain to be more soon. Here at Wisconsin, several people are in the process of developing a program, so stay tuned for that.

Perhaps I am too cynical (the study and practice of law can induce cynicism), but it is hard for me to imagine that the world is going to become a dramatically different place because of the study of social entrepreneurship. Promoters of social entrepreneurship talk about "blurring the lines" between business and social organizations. Fuqua's Center illustrates the blurring with this example (among others): "homeless shelters are starting businesses to train and employ their residents." This would be funny if it weren't so sad. At least a quarter of all homeless are severely mentally ill. Many others are abused or addicted. They do not need job training. They need treatment!

The fundamental problem with any attempts to blend learning from business entrepreneurship with social entrepreneurship is that the goals are fundamentally different. Business entrepreneurs measure their success by market acceptance and wealth creation. Social entrepreneurs measure their success by accomplishing a mission. As noted by Greg Dees in his now classic description of social entrepreneurship:

Markets do not work as well for social entrepreneurs. In particular, markets do not do a good job of valuing social improvements, public goods and harms, and benefits for people who cannot afford to pay. These elements are often essential to social entrepreneurship. That is what makes it social entrepreneurship. As a result, it is much harder to determine whether a social entrepreneur is creating sufficient social value to justify the resources used in creating that value. The survival or growth of a social enterprise is not proof of its efficiency or effectiveness in improving social conditions. It is only a weak indicator, at best.

Can you say "fatal flaw"?

What's the deal with Contracts professors?

Last year, when I first began teaching Contracts, I signed up for a listserv, the purpose of which is to discuss contract law. I am on a similar listserv for corporate law, but the activity level on the contracts list is much higher. Not only that, but the professors there spend much of their time dissecting twisted hypotheticals constructed for (or by) their first-year law students. By contrast, professors on the corporations listserv rarely use the list, and when they do, it is usually to discuss recent developments in corporate law.

Instead of thinking about the contract hypotheticals, I started wondering why contracts professors would be so much more interested in this sort of activity than corporations professors. Perhaps more people teach contracts, so that list gets more traffic? Perhaps contracts professors spend more time working out fundamental questions, while corporations professors build on that foundation? Perhaps contracts professors are smarter (or dumber?) than corporations professors? Maybe the contracts listserv has some participants who feed this type of discussion, but the corporations listserv doesn't? Hard to tell, but if anyone is listening, I would love to hear your theory.

Search Engines: The Life Blood of Internet-Based Home Businesses

Anyone involved in an Internet-based home business will soon come to recognize the importance of search engine optimization as a vehicle to attract potential customers from the search engines.

Since the inception of Google in 1998, the popularity of using search engines has increased dramatically. Nielsen NetRatings reports that about 114.5 million Americans, or a whopping 39 percent of the US population, currently use search engines.

Through February of 2004, Yahoo and Microsoft's MSN ranked as the two favorite spots on the Internet with 87.3 million and 86.2 million unique monthly visitors, respectively, according to figures produced by Nielsen NetRatings.

Microsoft.com, ranked third, with 64.2 million visitors, but this figure is somewhat misleading because this site attracts much of its traffic by repairing flaws in the Windows operating system. Google was the fourth most popular site with 60.8 million visitors.

The market shares of MSN and Yahoo haven't changed much in the past three years while Google has emerged as a powerhouse without spending much of anything on advertising. Google's audience is now approximately six times larger than it was in early 2001, when it was the 26th most popular destination on the Internet.

As they vie for position, Google, Yahoo, and Microsoft plan to continue upgrading their search engine services - healthy competition that can only serve to improve the search experiences of Internet users in the future.

According to comScore Networks, an estimated 3.5 billion online searches are performed in the United States each month, making searching the second most popular online activity, ranking behind only e-mail.

In 2003, businesses spent an estimated $2 billion on advertising related to searches and some knowledgeable sources expect the search-related advertising market to triple during the next three years.

There are various search engine formats including natural search, pay for inclusion (PFI), pay per click (PPC), and hybrid approaches which combine both PFI and PPC characteristics. Because of the immense and growing popularity of search engines, their effective utilization is the life blood of Internet based home business.

Kirk Bannerman operates a successful home based business and resides in California. For more details, visit his website at http://business-at-home.us