A good idea is nice; solid execution even better. But none of it means much without the capital to support it all. And it's not just about finding financing--it's about finding the right financing. Pair a promising company with a poor capital structure and you could be in business hell. Start-up capital is precious. Do not deplete your working-capital reserves until the venture is kicking off positive cash flow--chances are you will regret it. Back in the late 1990s, Recycling Company had a patent on a process that used absorbents to pick up oil on plant floors and recycle it. Competitors burned the absorbents (throwing off greenhouse gases), used toxic chemicals (further pollution) or stuck the oil residue in a landfill (contaminating the groundwater). RC needed $1.5 million for equipment, $700,000 for real estate and a significant slug of working capital. RC's financing solution: --Equipment. Because the equipment was very specialized, debt-financing was hard to come by--not that the young company could have serviced it anyway. So the board decided to sell some equity. However, the environmental industry was not attractive to venture capitalists with dot-com stars in their eyes. Instead, RC used angel financiers, mainly from the board’s network, along with some friends and family money. --Real estate. Initially, RC leased its building at market rates, even though there were plenty of subsidies available for those who knew where to look. (I renegotiated the terms with the community whereby RC received a chunk of subsidized financing.) --Working capital. RC used a combination of equity and loans guaranteed by the Small Business Administration--though the founders had to pledge significant personal real estate as collateral. Cash flow was healthy enough to service the debt. --Additional working capital for growth. As the venture grew, the company sold off additional equity and I found attractive debt financing from a regional development financing institution. --Research financing. This money came from a state loan program designed to encourage new-product development. RC tapped 10 different sources of capital--all to find the right financing at the right cost at the right time in its development. Result: RC has grown into a multi-million dollar (sales) business with a deep roster of large-cap clients. Its investors expect a juicy exit (sale to a strategic buyer or perhaps a public offering) in the next two to three years. Small-business finance isn't rocket science. But putting together the right scheme is definitely mission-critical. Source: Dileep Rao in Forbes.com.

Another rate cut, but will it work? Yesterday the Federal Reserve cut their key interest rate to just 1%. That's the lowest since 2003 and 2004 when the Fed was trying to spur economic activity after the dot com bubble burst. Even with rates sitting at that paltry level, the Fed says more cuts could come in an effort to head off the economic crisis. Even with the cuts, the market didn't respond well. A late sell off ended the day lower despite the cut. Some experts say the Fed has all but acknowledged that the economy is in a recession, and the only thing the bank can do is damage control. Delta Airlines and Northwest have finally completed their merger. The Justice Department announced yesterday they would not stand in the way of the deal. The new airline is the largest in the world. A group of financial industry leaders and community advocates are pushing a plan that would allow banks to reduce some credit card debt. Many borrowers, even those with good credit, are defaulting on their credit card bills and banks are swimming in red ink. The plan would allow banks to reduce the balance of credit card holders who don't qualify for other financial assistance plans. Rack up another victim to the changing times. Family owned craft supply store Zim's is closing it's doors for good on Saturday.

1974: Muhammad Ali knocked out George Foreman in the eighth round of a 15-round bout in Kinshasa, Zaire, to regain his world heavyweight title. 1975: The New York Daily News ran the headline "Ford to City: Drop Dead" a day after President Gerald R. Ford said he would veto any proposed federal bailout of New York City. 1989: Mitsubishi Estate Co., a major Japanese real estate concern, announced it was buying 51 percent of Rockefeller Group Inc. of New York. Source: New York Times

This will probably come as no surprise, but consumer confidence is very low. The Conference Board says their measure of consumer confidence is at the lowest level they've ever recorded in 41 years as fears of a recession continue. Even with that number, Wall Street had their second best day ever, jumping 899 points or 41 percent as investors snapped up shares they felt were undervalued. Investors also are anticipating another interest rate cut by the Fed, possibly to as low as 1%. Home prices along the Wasatch Front continue to fall. New numbers from the Salt Lake Board of Realtors show that home prices have retreated to 2006 levels in Salt Lake County. Experts predict that those home prices may continue to fall by a total of 15 to 20 percent, which means we've still got a ways to go before we hit those levels. One of my favorite papers, the Christian Science Monitor, announced plans to kill their daily publication, and move to a weekly. The change also includes an increased focus on their web strategy. To them I say, welcome to the 21st century. Good news for the nonprofit sector. Despite the economic downturn, a new study concludes most Americans plan to keep giving to charities. In fact, historical numbers show that people tend to keep giving to charities, even during tough economic times.

1964: Thieves made off with the Star of India and other gems from the American Museum of Natural History in New York. 1966: The National Organization for Women was founded. 1967: The musical "Hair" opened off-Broadway. 1971: Rock musician Duane Allman (The Allman Brothers Band) died in a motorcycle accident in Macon, Ga., at age 24. Source: New York Times

To keep staff--and to keep them committed--in times of great stress, “you need to start with something as simple as more effective communication,” says Barry. Hold town hall meetings with senior managers. Organize team briefings to inform everybody of the latest news. That way you keep everyone together and prevent employees from finding out about their future through the media. Massive layoffs make those who kept their jobs feel insecure. A manager can deal with this is by stressing that more work means more job security--companies rely more on their remaining employees, says Kerri T. Perez, a member of the Employee Relations Special Expertise Panel at the Society for Human Resource Management. Managers should also show that they are there to stay, says Perez. “Most of the times, when a company has a problem in a downturn, people are afraid that the person they report to or the leader in their area is going to leave them. It’s just human nature.” During this financial meltdown, workers have had less sleep, more anxiety and shown a wide range of physical and psychological problems: ulcers, memory loss, high blood pressure, fertility complications and depression. Mangers have to counter this sentiment expressed by one study participant: “It seems pointless to overcommit to work since the company does not seem to commit to its employees.” Source: Adriana Loeff in Forbes.com

In some parts of the midwest, gas prices are below $2 a gallon. BusinessWeek says that there are some gas stations in the Cincinnati area showing gas prices at $1.99 a gallon. AAA says the average price for a gallon of gas is $2.67, and only three states, California, Alaska and Hawaii have average gas prices over $3 a gallon. I'm finding these lower gas prices a bit shocking. I almost got into a couple of fender benders this weekend when I spotted gas below $3 at some stations. I think my brain couldn't comprehend at first that gas was that low. Oil prices have dropped almost 60% from record highs in July of this year. The price for a barrel of oil stood at $62 this afternoon.

If you're great at your job, it's likely only a matter of time before you're asked to become a manager. But just because you're a skilled employee doesn't mean you know how to be a boss--or even want to be one. In fact, being a manager might be frustrating if you're not able to do the type of work you enjoy. So how does a great employee become an effective manager? First, ask yourself if you truly want to switch roles. "Not everyone wants to be the manager-- but in order to make more money, move up the career ladder and please the bosses, you have to move into the role even if you'd rather be an individual contributor," says Gary Topchik , co -author of The First-Time Manager. The best managers give employees the resources to be successful. To accomplish that, new bosses should meet separately with members of their team to define each person's role. That's also an ideal time to discuss how their performances will be evaluated. At that meeting, explain what your employees can expect from you. That includes frequent, informal meetings to touch base; help achieving goals; training and development; timely updates on shifting priorities and a team calendar so everyone knows who's doing what and when. Source: Tara Weiss in Forbes.com

Looks like news organizations are tightening the belt as well. ABC News is canceling all newspaper and magazine subscriptions to save money. The organization is also nixing holiday parties and cutting back on travel in order to have the resources to cover the news... We report every day on the economic climate and the effects being felt throughout the country. We are not immune from the downturn. At the same time, the importance of the election and economic stories reminds us how much we have to do to help our audiences absorb and understand what is going on around them. What we need to do—and will do—is to make sure that we have all the resources we need to cover the news. Here's an idea for news organizations. Instead of paying a "star anchor" millions of dollars to do a half-hour or hourly newscast (I'm looking in your direction Katie Couric), why not hire some more reporters and throw some more resources into the field?

On top of having a P&L(profits and losses) that governs your accounting life, it's important to keep a schedule that governs your monthly cash flow. Imagine having a schedule in front of you every month that showed you exactly what was going on with your cash flow. A schedule that made it simple and easy to know exactly what was going on with the lifeblood of your business -- your CASH. That's the secret to taking control of your cash flow. You need an easy-to-understand view of each component of your business that affects your cash flow. Your cash flow schedule needs to show you what's going on with each of the components of cash flow mentioned above. If you're ready to take control of your cash flow, check out my December column, which provides you a template and step-by-step instructions for formatting easy-to-understand cash flow projections. Focus on understanding and managing your cash flow each month and you will make it dramatically easier to grow your business without creating a cash flow crisis in the process. Source: Phillip Campbell in Inc. Magazine.