Thiel's college dropout plan in bubble education

Thiel's college dropout plan scrutinized by '60 Minutes'

Investor and entrepreneur tells the CBS news magazine that a college degree is unnecessary for financial success, but critics call his program an elitist ploy. 

Billionaire investor Peter Thiel.

Peter Thiel's plan to pay college students to develop their promising concepts instead of attending to school is attracting students as well as critics.

Best known as a co-founder of PayPal, the Silicon Valley investor and entrepreneur has also made early-stage investments in companies such as Facebook, LinkedIn, and Yelp. Now he's investing in college students, awarding fellowships of $100,000 each to youth under 20 years old, essentially encouraging them to drop out of college to become entrepreneurs.

In an interview for tonight's "60 Minutes," Thiel tells Morley Safer that his program is a viable alternative to what he sees as a largely ineffective university system in which costs far outweigh benefits.

"We have a bubble in education, like we had a bubble in housing...everybody believed you had to have a house, they'd pay whatever it took," says Thiel. "Today, everybody believes that we need to go to college, and people will pay -- whatever it takes."

He also notes that a college degree is not necessary to land a high-paying job.

"There are all sorts of vocational careers that pay extremely well today, so the average plumber makes as much as the average doctor," Thiel tells Safer.

Critics call Thiel's plan an elitist ploy that only encourages others to drop out or not attend college at all.

"Peter Thiel has made so much money that he is out of touch with the real world," Vivek Wadhwa, an entrepreneur who teaches at Duke and Stanford, told Safer. "He doesn't understand how important education is for the masses."

"What I worry about is a message that's getting out there to America that it's okay to drop out of school, that you don't have to get college. Absolutely dead wrong."

"60 Minutes" airs at 7 p.m. PT/ET on CBS stations. Full segment embedded below.

by Steven Musil
Steven Musil is the night news editor at CNET News. Before joining CNET News in 2000, Steven spent 10 years at various Bay Area newspapers.  

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US market ahead: major signs say ‘sell’, the Facebook effect

NEW YORK (Reuters) - Normally a big decline would set up Wall Street for a technical rebound. But that may not be the case this week, even after the market posted its worst weekly loss for the year and the S&P fell for six straight sessions.

With the corporate earnings season drawing to an end and recent U.S. economic data raising doubts about the pace of growth, the S&P 500, which is down 7.3 percent so far in May, could decline further this week as concerns about the financial health of Europe persist.

"What has changed in the world since April? We went from hearing a constant refrain that the world is awash in money and markets must go higher to hearing nobody wants to take any risk ... All in a week," said Peter Cecchini, global head of institutional equity derivatives at Cantor Fitzgerald & Co in New York.

The S&P 500 fell 4.3 percent for the week, its steepest weekly decline this year, and closed below 1,300 for the first time in four months.

The hotly awaited market debut of Facebook on Friday was marred by technology glitches on the Nasdaq in sending messages back to the brokerages that handled orders of Facebook Inc for individual, or "retail," investors. Those problems rekindled fears about the market's electronic trading system and caused some investors to stay away from equities.

Weighing on sentiment is a growing sense among investors that the euro zone debt crisis is nearing new heights, fueled by fears of the potential for a Greek euro exit and the deteriorating health of the Spanish banking system.

Solid corporate earnings and upbeat U.S. economic indicators had fueled the rally in U.S. stocks, offsetting jitters over Europe. But with earnings almost out of the way and data starting to disappoint, investors have shifted their focus back to headlines out of Europe.

Leaders of the Group of 8 major industrial economies were meeting this weekend to try to tackle the financial crisis in Europe. U.S. President Barack Obama, the G8 host, has urged European leaders repeatedly to do more to stimulate growth, fearing contagion from the euro crisis that could hurt the U.S. economy and his chances of re-election in November.

"The market is extremely oversold. Nonetheless, all major indicators remain on sell signals," Larry McMillan, president of options research firm McMillan Analysis Corp, said in a report on Friday.

"We expect a powerful but short-lived rally should be coming soon. But at this point, barring some major shifts in our indicators, it may only be a rally in a larger down-trending market," McMillian said.

THE FACEBOOK EFFECT 

Facebook, the No. 1 online social network, disappointed investors with a tepid market debut on Friday. Shares rose a scant 0.6 percent - nowhere near expectations for double-digit gains on the first trading day - and the day was marred by technical problems due to huge order volume. The stock closed at $38.23 after falling as low as $38, its initial offer price.

The disappointing debut curbed investors' appetite for other social media stocks. Hardest hit was Zynga Inc , which closed down 13.4 percent to $7.16 after falling as low as $6.40. The stock was temporarily halted twice due to sudden declines.

LinkedIn shares fell 5.7 percent to $99.02, and Groupon fell 6.7 percent to $11.58. Zynga and Groupon, both of which went public late last year, are also trading below their IPO prices.

Despite the disappointing market debut and the weak performance of social media stocks, market participants are still optimistic about Facebook going forward.

"In any brand new area, social media in this case, most are going to be losers and only some are going to be winners. Yes, the IPO was disappointing, but Facebook is clearly the winner here and others aren't," said Randy Warren, chief investment strategist at Warren Financial Service.

The coming week's economic data includes April's existing home sales on Tuesday at 10 a.m. EDT (1400 GMT). Existing home sales are forecast at a 4.60 million-unit annual, up from 4.48 million in March.

New homes sales figures are due on Wednesday at 10 a.m. EDT. April's new home sales are also expected to post an increase, gaining about 7,000 units over a 328,000-unit annual rate in March.

Initial jobless claims and durable goods orders will be published on Thursday at 8:30 a.m. Consumer sentiment is due at 9:55 a.m. on Friday.

For the week, the Dow was off 3.5 percent and the Nasdaq was down 5.3 percent.

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The Facebook Fallacy

The Biggest Cost of Facebook's Growth

Running the world's largest social network will be a technical and financial challenge as it grows.

Data store: Facebook’s data center in Prineville, Oregon, is one of several that will help the company cope with its always growing user base.  Facebook

Facebook is the gateway to the Internet for a growing number of people. They message rather than e-mail; discover news and music through friends, rather than through conventional news or search sites; and use their Facebook ID to access outside websites and applications.

As the keeper of so many people's social graph, Facebook is in an incredibly powerful position—one reason its IPO this week is expected to be the largest ever for an Internet company.

But potential investors should take note that there's a flip side to Facebook's explosive growth and power; that flip side, as one analyst put it, is its bid to become a core piece of the Internet's infrastructure. Facebook's own technology infrastructure is expensive to build and operate, and it must scale rapidly.

Infrastructure is Facebook's biggest cost, and to support growing traffic and network complexity, it will have to spend even more. What's less clear is whether Facebook's revenues will likewise increase—especially if additional traffic comes from less lucrative visitors, such as people accessing the site from their phones or from outside North America and Europe.

To date, Facebook has been up to the infrastructure challenge. In less than eight years it has grown to host 526 million daily users, 300 million daily photo uploads, and nine million applications.

Two metrics highlight Facebook's success in this respect.

First, Facebook spent $860 million, or about $1 per active monthly user, to deliver and distribute its products last year. The bulk of that money was related to data center equipment, staff, and operating costs. That is up from about 80 cents and 60 cents per user in the two previous years. For the moment, however, Facebook's revenue, currently at $4.30 per user, is growing at an even faster clip. That's a good sign for any potential investor.

Second, Facebook is not only the Web's biggest social media site, it is also consistently the fastest. In 2010, Facebook's response time averaged one second in the U.S., but had improved to 0.73 seconds by mid-2011, according to AlertSite. By comparison, LinkedIn, the next fastest, took nearly double the time to load. Twitter's site was a full two seconds slower.

Facebook has come a long way since it was first hosted in Mark Zuckerberg's dorm room and expanded as he rented additional servers for $80 a month. By late 2009, Facebook disclosed it was using about 30,000 servers, and since then, the number has more than doubled.

As it has grown, the company's engineers have had to innovate to keep costs down and process a growing volume of data. For example, Facebook designed minimalist custom servers that are cheaper for it to build and run than off-the-shelf ones. It also built a program to optimize the performance of its code, cutting the computing demand on its Web servers by 50 percent. It has open-sourced many of its software innovations and also created the Open Compute Project to widely share its new server designs, with the hope that others could contribute useful innovations.

Today, Facebook is building its own data centers in Oregon, North Carolina, and Sweden. Last year it spent nearly a third of its revenues, $1.1 billion, in capital expenditures on networking equipment and infrastructure. It plans to spend as much as $1.8 billion on such costs this year.

These infrastructure investments are a good sign, says KC Mares, a data-center energy expert and the founder of MegaWatt Consulting; owning and operating rather than leasing data-center space will help Facebook save money in the long term. Other growing tech companies such as Google have pursued this same strategy.

But as Facebook's IPO filing makes clear, there is also a risk to investing in a global infrastructure to serve all users, regardless of their short-term profitability. It is a balancing act.

"If you add too much, it's a big cost that eats into your revenues. If you don't add fast enough, it's an opportunity cost of customers you can't serve," says John Pflueger, a board member of the Green Grid, an IT industry group.

Coming to the wrong conclusions about how to invest in infrastructure can have major consequences. Just look at Friendster, a social network founded before Facebook and MySpace. Friendster had more than 100 million users, but it quickly fell behind as Facebook came to dominate the landscape.

Jim Scheinman, head of business development at Friendster until 2005, says Friendster made product decisions that required too much computing power. For example, it tried to calculate up to six-degree connections between all users. As a result, the site slowed to a crawl. Today, big Web companies often calculate exactly how much revenue they lose when a page is slow to load, even down to tenths of a second.

Facebook, of course, is long past its early days and has more than a critical mass on its platform: almost half of the world's population of Internet users. But to stay relevant as it battles companies like Google, it'll have to stay on the cutting edge, and it will need the computing power to support that.

The question, says Scheinman, is less about costs and capital and more about engineering challenges: "When they have a billion people, and as people use the product more, does that create scaling issues they haven't yet seen before?"

By Jessica Leber Newscribe : get free news in real time  

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LinkedIn's Growth Continues: Fueling the Corporate Talent Machine

 Another amazing quarter from LinkedIn: revenues of $188.5 Million, up 101%, with the “hiring solutions” business now driving $102.6 Million or 54% of company revenue. LinkedIn’s revenues in the corporate recruiting market are now larger than Taleo (just acquired by Oracle for $1.9 Billion), SuccessFactors (just acquired by SAP for $3.4 billion), Kenexa, and nearly every other software company which sells recruiting solutions.

Let me highlight how LinkedIn is “fueling the corporate talent machine.”

LinkedIn has become the “must have” in corporate recruiting and is expanding its footprint.

With more than 161 million professional users in its network, LinkedIn is now the “must-have” tool for corporate recruiters around the world. The company’s “hiring solutions” business continues to deliver innovative products which leverage the data in the LinkedIn network for corporate and contract recruiters.

These products include:

• Highly effective job placement ads (recruiters tell me LinkedIn ads generate 2-3X the quality of candidates of other ad placements)
• Licensing  LinkedIn Recruiter, the recruiter’s “secret weapon” which lets corporate HR managers and staffing professionals search, find, and source candidates
• Branded career pages – an offering that lets companies of all sizes create a highly personalized candidate portal within the LinkedIn garden of  professionals
• Talent Pipeline, a new feature set within LinkedIn Recruiter which lets recruiters manage the entire process of “candidate relationship management” – a hot new application area within corporate HR.

And the company has much more to come.

The Corporate Talent Acquisition Market


Corporate recruiters are in a war for talent. Lloyds of London’s 2011 risk assessment survey points out that “Talent and Skills Shortages” are the #2 rated risk among 100 business risks today (following the risk of “losing customers.”)

Despite the high unemployment rate in most countries, companies tell us over and over that there is a paradoxical mismatch between demand and supply of skills. And great candidates are not looking for work.

And the cost of sourcing and recruiting is very high.

The average employer spends over $3500 per hire on all areas of recruiting (from our Talent Acquisition Factbook®), and the spending is much higher in executive positions. This means the entire US marketplace for talent acquisition is around $130 billion by our estimates, so LinkedIn still has a lot of whitespace to cover.

I just finished meeting with the head of corporate recruiting for Pfizer (who is on LinkedIn’s advisory council) and she reinforced that LinkedIn’s network is truly global and has become one of their primary tool for finding great candidates.

Pioneering the shift from cloud-based software to BigData applications.

LinkedIn is benefiting from something else here. The company understands that its future relies in leveraging BigData and the power of the network over the existing markets for cloud-based HR or talent acquisition software.

Raj de Datta describes the shift well in his TechCrunch article “The Rise of BigData Apps and the Fall of SaaS.” The next big thing is data. BigData.

I’m not ready to write-off enterprise software businesses by any means, but ultimately cloud-based applications do become somewhat commoditized. Now that most major applications are “in the cloud,” differentiation comes down to architecture, features, and level of integration with other cloud-based systems.

If you’re an HR manager, can you really tell a huge difference between Oracle, SAP, Taleo, SuccessFactors, Cornerstone, SumTotal, and PeopleFluent? Workday claims they are the “next big thing” – but ultimately even new products like Workday become replaceable. This year I’ve talked with at least a dozen companies who are coming up for renewal on their cloud-based software and they are very willing to switch platforms. So the future of cloud-based software is wrapping all these great applications in rich, highly-integrated data.

A great example of this is trend is Salesforce.com.  We are a big user, and it always bothered me that we have to clean and maintain our own database of accounts when every other Salesforce customer is doing the same thing. Voila. Salesforce acquires Jigsaw, and now Data.com is born. You can now buy data to go along with your new CRM system.

Data, unlike software, becomes increasingly valuable as you collect more. In the enterprise Human Resources market companies are dying to get more data – data about candidates, data about workforce skills and demographics, data about salaries, and data about their own brand. Once this data is integrated with your cloud-based application, the value to a client skyrockets.

And even when you do buy your brand-new cloud-based applications for talent management, you still need to load them with data in order to make them work. Not only do you have to load all types of data about your employees, you also have to load job profiles, assessments, training modules, and dozens of other types of third party data. As HCM software companies mature, they will start building and adding their own data products to their offering.

Companies in the HR space are starting to figure this out. SHL, a leading global assessment provider recently launched its new Talent Analytics ”big data application.” This new platform gives customers access to tens of millions of assessments to compare candidates against the market and their competitors.

Data is sticky, proprietary, and ever-increasing in value.

The acquisition of Slideshare drives even greater data value – fueling both memberships and recruiting revenue.

LinkedIn also announced the acquisition of SlideShare, a great little company that has become the “YouTube” of corporate presentations. Slideshare is an addictive application that encourages you to share your best slide sets with others.

Not only does Slideshare further ignite LinkedIn’s membership business by extending the data people can add to their profiles, it also brings tremendous value to the corporate recruiting segment.

Think about this: Slideshare is a vast database of knowledge and expertise, all published through Powerpoint presentations that are easy to view, download, and share. Some of the most powerful thinkers and practitioners in all industries publish their deep expertise in SlideShare, and the content is trivially easy to find and view.

Once Slideshare is fully integrated into LinkedIn, we can expect the company to link data about slides to data about people.  (The company claims that there are already 9 million content uploads and we can expect that to explode.)

Every time an individual uploads one of their favorite Powerpoint decks their “profile” becomes more valuable to others. And since people can “like” and “comment” on slide sets, LinkedIn can start to see who the real experts are throughout the network.

Imagine the power of using this information to assess someone’s skills and experience. By looking at the traffic and ratings of an individual’s slides, and the relative “authority” of those who link and recommend these slides, LinkedIn can create one of the most powerful expertise-networks in the world.  The company has been working away on its “skills” functionality for a few years (look at the “skills” application under the “beta” link). This will further ignite LinkedIn’s ability to characterize and understand who the real experts are.

Why is skills information so valuable? Because when recruiters search for candidates, one of the most important challenges they face is “finding the right skills.” Companies pay search firms tens of thousands of dollars to find the best highly-skilled candidate. Putting more “skills-related” information into LinkedIn creates a new measure of authority and expertise.

(Skills have become the new currency of success. While experience and raw talent still matter, our research shows that jobs are becoming more and more specialized every year, so deep skills are what makes you succeed.  Read “The End of a Job as you Know It” for more details. )

Plus, of course, Slideshare dramatically increases the amount of information each LinkedIn user can upload – making the whole network far more valuable for individuals and members.

By the way, I noticed that LinkedIn recently removed several features from its free membership service (the ability to see who clicked on your profile, for example). Every time the company adds a new type of data-driven content, LinkedIn can come up with new, higher-value membership packages as well.

LinkedIn is really firing on all cylinders.  Watch the company continue to grow as it “fuels the corporate talent machine.”

I would expect LinkedIn’s hiring solutions segment to continue its growth as a percentage of revenue in the coming quarters. And with little competition in the BigData market for candidates, we should see this growth accelerate as the economy picks up steam.

By  Josh Bersin, Forbes Contributor

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7 Ways to Avoid a Poor First Impression in Business

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Martin Zwilling, Contributor

I provide pragmatic advice and services to entrepreneurs and startups.

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Illustration By Paul Gilligan from Getty Images >>

Entrepreneurs are all about firsts, and the most important is you making a great first impression – on investors, customers, new team members, and strategic partners. Poor first impressions can be avoided, but I’m amazed at the number of unnecessary mistakes I see at those critical first introductions, presentations, and meetings.

The key message here is “preparation.” People who think they can always “wing it,” bluff their way past tough questions, or expect the other party to bridge all the gaps, sadly often find that what they think is a win, is actually a loss which can never be regained.

We’ve all met people that we instantly like because of a great first impression, and want to do business with. Here are some common sense things that they do and you can do to maximize the first impression that you impart in any business environment or discussion:

1. Dress appropriately from the perspective of the person you are trying to impress. This one is so obvious that I hesitate to mention it, except for the fact that I see it ignored so often. Maybe you love wearing Hawaiian shirts to work, but when you visit a traditional banker to close on a loan, it will be worth your time to put on a solid shirt and jacket.
2. Always research the person online before a first meeting. In today’s world of LinkedIn and Facebook, there is no excuse for not recognizing a person as you meet them for the first time, and knowing their accomplishments, if not their interests and academic background.
3. Google the organization and the role they represent. It’s polite to ask a professional you just met about their company affiliation, but it’s much smarter to ask them about a current issue, making it clear that you already know a good bit about their company, and their role in that company.
4. Find a common business link or friend to warm up the connection. The best introduction to a new customer, or potential angel investor, is a warm introduction from a common friend, rather than a cold call. In my opinion, this approach will double or triple your probability for success, no matter what the transaction.
5. Be prepared to concisely state your key objective. Before the other party has to ask, you should look for an opportunity to net out what you are here to accomplish, and even have a couple of questions in mind that you would like to get answered. Think of it as not forgetting to ask for the order.
6. Know a lot, but don’t flaunt it. Some people do all the right legwork, but then kill themselves by appearing arrogant or obsequious in the way that they can’t stop talking about everything that they know. When you meet someone new who is important, your first words after “Hello” should be a question rather than a long personal dissertation.
7. Be positive, courteous, on time, and attentive. We have all met people who, when asked “How are you?” provide a long litany of their latest woes, or a diatribe on current political issues. Obviously, being late to your own meeting, or appearing distracted or uninterested, will also leave a bad first impression. Smile and relax.

All of the common first impression mistakes are avoidable, and elements of the right approach are easily learned. Most entrepreneurs have spent months, and hours of hard work, preparing the necessary business plans, executive presentations, and financial models to impress investors. Just apply the same diligence in preparing yourself for all those “first” opportunities.

That image of you that you first present usually lasts longer and has more impact that any document you can prepare. In the book “You Are the Message,” media executive Roger Ailes wrote that your first impression will be solidified in the first seven seconds. Use them wisely.

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Social climbers in Malaysia: Race, Datuk, Datin or Puan Sri, not professional meritocracy

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Social climbers aplenty

A Writer's Life By Dina Zaman

In Malaysia, titles carry a lot of weight. People lie about their names, and some second wives even insist on being addressed as Datin or Puan Sri.

IT all began when I met a fortune teller in Butterworth who chided me for not using my honorific title before the name that you see now. In other words, a family title.

“If you acknowledge this heritage, this name that your family ancestors gave you, you will become very, very, very rich!” she said.

I thought, I could live with that. I am tired of being a financially struggling writer.

A month or two later, I edited my LinkedIn profile and put, ahem, the title in front of my name. Boom! Boom! Boom! I received a monthly average of three potential connections to link with.

Now, I have been a member of LinkedIn.com for more than seven years, and I would receive an invitation to connect like, perhaps, once every two to three months.

This very strange phenomenon affirmed the following to me: First, I’m not a celebrity, hot, and popular. These new friendships confirmed to me that a lot of Malaysians in general are social climbers and will only befriend you if you have wealth and social standing.

My charming personality and some brains have nothing to do with my instant popularity. Tsk.

Before we go on, allow me to clarify a few things. I do have a title tagged to the name my parents gave me. I do not understand why there are women who want to marry into the firm, because having an honorific is hell on forms and documents.

I am grateful that my parents gave me a beautiful name. Maybe at that time of registration, in 1969, there were many tiny boxes to fill in my title and name, but 21st century forms are horrible to fill in your particulars.



Two. Maybe I am related to some very titled and privileged people and maybe I am not. So don’t bother befriending me. I cannot guarantee you an invitation to the istana or a royal event.

I myself do not attend such dos. The one or two times I had been invited, I had to cover an event. If there ever was a personal invitation, and I cannot remember any, I chose to sleep.

I have always invested in very nice beds and mattresses. They win hands down all the time.

Also, if I am related to some Tengku or Raja, it would be 100 times removed. I call myself a SociaLIKE. I only mingle with people I like.

That LinkedIn caper left a bitter taste in my mouth. Surely all the work I had done over these 18 years would have amounted to something. I worked very hard to get to the little mountain I am on now. I can do this, and I can do that.

Actually, I am smarter than some of these titled people. Still, was an honorific my passport to professional and social success?

Unfortunately in Malaysia, titles carry a lot of weight. People even lie about their names.

Friends who work in events and public relations will call me, laughing over guests’ pretensions. “Wah, since when ah, did this person become a Tengku, or Datuk?”

I myself have seen a business card which had the grandfather’s datukship! Since the person’s father was not a datuk but the grandfather was, the person insisted on having it on the card.

How do you take someone like this seriously? Obviously many do, because the person is a director of a public-listed company.

I have also met second wives who insist on being addressed as Datin or Puan Sri. Darlings, think what you will, but that privilege belongs to the first wives only. Non-negotiable. Lu sudah sapu sama laki, mau sapu title pulak?

There is little professional meritocracy practised in this country: it’s not just your race, it’s who you are related to, who you know in this country, (and perhaps also the bomoh you’ve hired) that gets you places.

This may be 2012, but Malaysia is very much a feudal society. A title may not get you that timber deal, but at least the waiting staff or sales clerk will stand to attention.

And perhaps this is why we hold on to social status like a limpet: because there are so few honest successes in this country.

I have been asked before what I thought of the monarchy in Malaysia. If there is one legacy any monarchy should have, it would be that it has served its people well.

It should act intelligently and be compassionate. It should not be known for excess and wastefulness,
especially in times of austerity. Granted, there are a number of royals who have contributed to the country, but how many have left proper legacies?

I do enjoy reading the Malayan history of monarchy and aristocracy. Reading the Hikayats make me yearn for simpler days. Modern day aristocracy has lost that romance, refinement and adat.

Three months into my experiment, I was already getting irritated by requests to connect. My e-mail was constantly alerting me of new possible friends I could network with. And I still have yet to hit the jackpot. So I called the fortune teller in Butterworth.

“Aunty! Apa dei, I put the title in front of my name and I’m still not rich la!”

“Aiyo, it is the month. The stars are not aligned … you see, my dear …”

I squawked on the other side of the phone. I had no time to deal with astrological alignments. I went to my laptop and edited my LinkedIn.com profile. Goodbye title.

And what a marked change. To date, I have only had two requests to network with me, and these were old friends from university. I like it that way.

To those who added me on the basis of my name, I don’t want to do business with you. And to those who appreciate my work, and think that there are possibilities, you know how to get me.

> Dina Zaman is a writer based in KL. She is interested in Malaysian religious histories and its people.

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Financial Advisors Get Social

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 Raymond James Financial Advisors Get Social

Tom Groenfeldt, Forbes Contributor

Financial advisors at Raymond James are now able to use social media tools including LinkedIn, Facebook and Twitter through the Actiance compliance tool, Socialite. Advisors also have optional access to a library or pre-approved content and tools to measure engagement.

Mike White, marketing director at the Florida-based financial services firm, said the Actiance alliance fulfills a commitment made early in the year to provide social media tools for advisors.

Financial firms have been slow to adopt social media, he said, and they have watched to see how regulators would interpret social media communications.

“In addition to incorporating the technology and archiving platform with Actiance, we have developed guidelines, training sessions and marketing and communications support to help advisors leverage social media in their client engagement and new prospecting activities,”  added White.

In the two months since the Actiance rollout, 1,200 of the firm’s 5,000 advisors have signed up. The company offers interactive video training to show advisors how social media can be used properly.

“We know there have been a lot to mis-steps [with social media] by public figures and we want out advisors and our brand to be protected in the process.”



Early adopters at Raymond James spread across all ages; the fastest to move to social media are the advisors who are most marketing oriented, White said. As the technology becomes easier to use, the age skew is not as pronounced as it once was, he added. Grandparents are among the most active users of Raymond James online services.

White thinks advisors will use social media both to stay in communication with existing clients and to prospect for new ones.

Raymond James has several people in its 200-strong compliance group who review all social media content before it goes out, with the result that approvals can usually be done the same day content is submitted. Tweets and posts go through a workflow process to provide the firm compliance oversight while allowing advisors to offer a personal touch.

“Our understanding [of the regulations] is that we do not have to review communications ahead of time, but we are being conservative.”

White said that in addition to approved canned content the company offers Tweets and posts from its economist or stock strategist.

“One great thing about Actiance is they were relatively early to the game of social media so they understand the importance of providing flexibility and insight to the communications.” The company also reviews blogs by its advisors before they are posted, a process which White said is now at the point social media was a few years ago.

“We treat blogs as ads that have to be pre-approved.”

The Aite Group, a financial research firm, entitled a recent report on social media for financial advisors “The Bloom is off the Rose.” Roughly 7 in 10 financial advisors use social media for personal purposes and half use it for business, figures which have increased since 2009, said Ron Shevlin, senior analyst with Aite Group and co-author of this report.

Use of LinkedIn has increased for business purposes and the time spent on Facebook, Twitter and blogs has declined among financial advisors. Advisors don’t spend much time on leading social media finance sites such as Stockpickr or Wikinvest; only a third of the advisors surveyed were even familiar with them.

Advisors are seeing diminishing returns from social media, according to Aite. Reaching new prospects was cited by only 19 percent, half the percentage in 2009 while increasing revenue or fees linked to social media declined from 16 percent to 6 percent.

Just six percent of advisors who don’t already use social media plan to do so over the next year. Thirty-eight percent said it wasn’t worth their time and 34 percent just don’t like to communicate with customers that way. Nearly three-quarters said their firms have policies that limit or ban the use of social media.

Vendors had some suggestions for the best ways to use social media. Actiance told Aite Group that responding to clients’ postings, such as a new child or a new job, with an appropriate messages is effective.  Echoing what White said about early adopters eMoney Advisor noted that advisors who are good at marketing are good at using social media. Financial Social Media’s recommendations suggest why some advisors are losing interest — they recommended Tweeting three to five times per day and updating LinkedIn and Facebook at least twice a day. That suggests a substantial time commitment. Other vendors of social media tools including SocialVolt, Socialware, SocMediaFin, SunGard, ThomsonReuters and Wired Advisor had a variety of suggestions about defining an approach to marketing, listening to the market and building out social networks.

Aite concluded that many financial advisors have decided that social media is not living up to its hype.

“The absence of tangible benefits from social media is muting advisors’ perception of its potential importance,” said Shevlin. Financial firms should expand their focus beyond compliance to look at effectiveness, added Aite, offering several specific suggestions for defining messages, choosing the proper platform and improving marketing skills.

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How To Use Social Media To Promote Your Small Business

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Kym McNicholas, Forbes Staff

Image via CrunchBase

You have a small business and you haven’t bought into the social media craze? Guess what? Silence is no longer an option. People are online talking about your company as you read this, whether you like or not.  If you don’t engage in the conversation, you risk losing your customers. But maybe you don’t have a choice as many small airports do in the State of California and across the United States. Many are owned by cities who don’t give them a dime and yet take money whenever they please. Those city managers force their airport managers to jump through hoops and political red tape to be able to promote their facilities. These airport managers have their hands tied in dealing with counties which just recently decided to launch a website, let alone a social media marketing strategy. So, I was asked by Michael McCarron, Public Information Office for San Francisco International Airport, to speak to the managers of small airports through California about the benefits of having a social media presence, so that they can convince their ‘bosses’ to allow them to open Facebook, Twitter and Google+ accounts, as well as to create blogs.

Here’s part of my presentation. I hope it helps you with your online social media strategy. If You have more ideas, please share them in the comments section at the bottom of the post. The more ideas, the better.

1. ASSESS YOUR ASSETS: The first action you should take before engaging in online marketing or social media marketing and engagement is to look at what are you’re trying to promote. What are your assets? Who are your target customers? It may seem obvious. But, A Bay Area airport had small planes for rent. But business was slow because they were simply targeting pilots trying to rack-up hours. Turns out there was a larger audience they could target through social media, tourists looking for aerial Bay Area tours. Business took-off.

SIGN-UP FOR SOCIAL MEDIA: Facebook, Twitter, Google+, YouTube and LinkedIn. Facebook allows you to create a business page.  Make sure you read the rules for businesses first. You can even ‘create a page’ through your personal account, if your business allows you to do so. That makes it easy for small business owners to manage it. On LinkedIn, every employee becomes your best advocate.



FIND A SOCIAL MEDIA MANAGER: Managing multiple social networks is daunting. So, before you start posting content, requesting friends and adding followers, sign-up for a social media manager such as Ping.fm and HootSuite. It allows you to manage all of your accounts on one site and schedule your messages to deploy so you don’t have to sit over it all day. It also allows you to review the success of the tweets real-time with click-through statistics. And you can gather all the mentions of your brand, industry or search terms on Twitter through it as well. That’s for the free version. I suggest trying that first. As you get more involved in social media, I prefer SproutSocial.com. You have a choice on plans for nine-dollars to $49. There’s a 30-day free trial to make sure it works for you. What I like is that it allows you to take all of those you follow and the followers and create contacts out of them which you can manage in the system and track engagement. It also has one inbox for all of your messages from all the networks. Plus, it allows you to track check-ins at FourSquare and Gowalla.

POST UPDATES: It’s important to have content on your social media pages before you start adding friends and followers. When you try to find friends, they’re going to look at the page to see if they want to follow you. So you need to give them a reason to follow you first. Provide valuable information about the industry. Post pictures of your business or people enjoying your business. On YouTube, post videos of your business, customer experiences, and encourage customers to make their own. You can also ‘favorite’ other YouTube users’ videos and they will end up on your page. If you’re a small airport, posting cool aerobatic videos of the Patriots’ Jet Team is a possibility that would add value to those who ‘subscribe’ to your page. Also, share those videos on your other accounts such as Twitter, Facebook and even LinkedIn.

FIND FRIENDS AND FOLLOWERS: Twitter and Google+ are easiest. Search keywords to find followers. On Twitter,  If you’re a small airport, for example, search ‘pilot. You can also search ‘flying.’ Searching your town and surrounding areas as well to find key influencers, news outlets, bloggers and city officials. Also, search for large players in your market. For airports, try Boeing, Virgin America, United Airlines and Southwest Airlines. If they share your posts, you have the potential to reach thousands.  I suggest adding just a few people at a time.  On Google+, comment on one of their posts immediately. On Twitter, mention them in a post immediately. You can also comment on one of their posts or simply say that you look forward to following their great content.  If it’s a reporter or blogger, give them story ideas and leads that have nothing to do with your business. Get them to trust you. To find fans on Facebook, it’s best to start with real friends and family. You can also pay as little as $100 to have an ad for your Facebook page syndicate across the network for a designated period of time.

7. ENGAGE FRIENDS AND FOLLOWERS:
Cory Colligan who used to be head of marketing for California Bouquet friended me on Facebook. When she asked to be my friend, she typed a personal message, saying how impressed she was with my work and how she’s enjoyed watching my work evolve. I couldn’t remember where I knew her from. Was it a television station, radio station, or was it from school? I wasn’t sure. I was too embarrassed to ask. And she seemed harmless. So, I confirmed her friend request and wrote her a note back thanking her for her feedback and saying that I look forward to connecting. She proceeded over the next few months to follow my videos and stories. She engaged in great debates and conversation with me as well as my friends. I knew just days after I added her that I didn’t know her personally. But I was so impressed with her and the relationship we’d developed over the months, that when I was traveling to her town, Fresno, I suggested we have lunch. When I arrived she had a full basket of goodies from her shop, including the best dark chocolate covered strawberries I’ve ever tasted, waiting for me. Since then, I have been a regular customer and am quick to share her products on my page.

So, your first priority should be building that relationship with people, not pitching your service or product.

Give them story ideas and leads that have nothing to do with your business.

On Facebook:
Share their links on your wall and/or comment on them. Wish them a Happy Birthday. Birthdays are big on Facebook. Always acknowledge them. Maybe even offer them a discount coupon for a birthday treat via Facebook.

On Twitter:
Retweet their stories and comment on them! Reply to each and every message. Keep the conversation going. Get them to trust you. For example, one of my favorite Twitter followers is @heykim. She is an amazing example of how to do it right. She has thousands of followers. But she has even more friends. She friended thousands of people little by little and engaged with them, retweeting their tweets, commenting on their tweets, checking in on topics those folks had tweeted on days before. Now, she’s constantly in conversation with folks like Morgan Fairchild, Alyssa Milano and Kathy Ireland. Alyssa Milano even just shared a linked @heykim posted tonight about how Twitter has transformed over the last five years. Who would’ve thought? She’s not famous. The key is she knows how to engage. And she never misses a #FF (Follow Friday). On Friday’s many people share with their friends, their favorite people to follow, encouraging others to follow them as well.

Google+: It’s a cross between Facebook and Twitter. It’s great because you can create circles of certain people you want to target for different reasons. It makes it easier to post certain promotions to one group vs. another.LinkedIn: The best way to engage with potential customers is by joining industry groups and starting group discussions.

Very important: Do not ask for help/favors from people until you’re friends or at least warm acquaintances with them. And the #1 way to become friends is to offer tons of help/favors without expecting anything in return. In the words of Michael Ellsberg, Forbes Contributor and Author of “Self-Educated Millionaires: The Seven Skills You’ll Never Learn in College, “Networking is a *long term* activity – it CANNOT be done for short-term results. Follow these basic concepts, and you’ll be ahead of 99.99% of the knuckleheads out there who are botching their networking attempts online!” Also, a great book to read is by Brian Solis, Principal at Altimeter Group, “Engage: The Complete Guide for Brands and Businesses to Build, Cultivate, and Measure Success in the New Web.”

8. STAY CURRENT: Get alerts sent to your phone when folks engage with you via your social networking sites – at least in the beginning – that way you respond quickly.

Please share your tips and tricks that will help small businesses sign-up and use social media. This certainly just scratches the surface. Please share the most creative marketing campaigns via social media in the comment section below.

Social Media Isn’t Free to Entrepreneurs or Anyone

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 By Martin Zwilling

If you are an entrepreneur today, and not using social media to promote your business, you are missing out on a huge opportunity. But, contrary to what most people preach, it isn’t entirely free. Most social media outlets don’t require a subscription charge, but they certainly require an investment – in people, in technology, your reputation, and your time.

There are hundreds of consultants out there who will take your money for guidance in this area, but I recommend that you start with some free resources on the Internet, or one of the many recent books on this topic. One I just read, “How to Make Money with Social Media” by Jamie Turner and Reshma Shah, Ph.D., hits all the right points from my perspective:

• There are risks as well as benefits. As with many startup activities, you only have one chance for a great first impression. You can jump into social media with a poor brand definition, poorly focused content, unrealistic expectations of customer service, or be killed by malware or viruses.

• Assess social media relevance to your product or service. If your business is industrial B2B products, social media should be low on your list. Spend your time and money on other platforms. If you are selling to consumers, especially younger ones, your business won’t survive without an effective social media presence.

• Attracting key stakeholders requires sensitivity. For some customers and many investors, a heavy focus on social networks and viral marketing may be a negative, rather than a positive. A balance of conventional and social communication and marketing is always advised.

• Pick the right platform for your business. Within each of the platform categories defined above, there is a right one and a wrong one for your audience. For example, LinkedIn is attuned to business professionals, Facebook is dominated by the social and upwardly mobile crowd, and MySpace is for tweens and creative types.

• Communication and writing skills are required. Heavy texting experience is not a qualification for communicating via social media. In additional to strong journalistic writing and storytelling, you need business acumen, strategic thinking and planning, and the ability to do the right research. These days, video production is also a useful skill.

• Make social media an integrated part of an overall strategy. An integrated marketing strategy starts with an overall brand management strategy, delivered through online and offline communications, promotions, and customer engagement vehicles. Your Twitter YouTube messages better match your print advertising message.

• Find the right tools to analyze the ROI. Return-On-Investment metrics are not new, but the tools are different. Get familiar with current social media tools, such as Google Analytics, Omniture, and HootSuite analytics. Over time, put together the data you need to measure your progress on a weekly/monthly/yearly basis.

The key social media platforms today include communications (WordPress blogs, Twitter), collaboration (Wikipedia, StumbleUpon), and multimedia (YouTube, Flickr). In looking ahead, don’t forget the mobile platforms (iPhone, Android), and location-based services (Foursquare, Gowalla).
As with any resource or tool, you need to optimize your social media costs against a targeted return. That means first setting a strategy and plan for what you want to achieve, then executing the plan efficiently, and measuring results. It’s not free, but it’s an investment that you can’t afford not to make.

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