Indinero: a small businesses' Mint

Strategic budgeting has always been a sore spot for entrepreneurs. Indinero launched, on this past Thursday, with the goal to make this spot disappear.

Indinero is a solution to the complicated accounting software provided by companies like Intuit. Indinero shares the same goal as personal finance website, Mint, the company recently acquired by Intuit. The purpose of both companies are to make tracking, budgeting, and financial planning relatively easy. Indinero provides a very easy-to-use user interface that will make any small business owner satisfied.

Indinero is a Y-combinator produced start-up, founded by two computer science grads from Berkeley. These grads, Jessica Mah and Andy Su,  saw a great opportunity after noticing the problems that regular business owners have with accounting. Either the software was too expensive, too complicated, or not comprehensive enough to act as a stand-alone resource.

Indinero tracks spending by connecting bank cards with real-time information, and then graphs out the trends in spending habits. The site gives the user a great looking dashboard, as well as useful tabs (Income, Spending, and Trends). And the company has even announced a plan to add a "forecasting" feature to the menu.

We use Mint, and we believe that if the launch of Indinero is done correctly, it will greatly benefit small businesses all-over. It is slated to be a one of a kind experience. Who knows...Intuit could see the startup as a threat and decide to buy, leading it to walk in the footsteps of Indinero's predecessor for personal finance(Mint).

Wesabe gets the cold shoulder

Wesabe the website for personal finance has decided that the shoestring budget that it operated on, was not adequate enough for the customers it served.

The site after opening in 2005, was very innovative it its approach but was simply outshined by Mint. Wesabe was meant to provide secure tracking of spending for its customers.

The area where it may have made distinguishable mark is its "groups" section, which happens to be the feature they are keeping operational. It allows individuals from all walks of life, join in and ask for advice on certain topics. The community emphasis on Wesabe was definitely a focal point, and is what kept the site up for as long as it did.

There's nothing to worry about, because there are many sites that are clamoring to be the replacement of Wesabe. Such sites consist of the powerhouse HelloWallet. HelloWallet is a financial "guidance" site that operates independently of all banking institutions. It charges fees to each user, but without ads, there's no telling how will be received by the public.

Using revenue to repay loans, Revenue Loans is orginal

On its website, Revenue Loan proclaims, "Revenue Loan provides funding to companies in exchange for a small percentage of future realized sales. This is Revenue Based Finance"

From the get-go we see great things for future entrepreneurs and this company. Revenue Loan has no interest (no pun intended) in taking board seats, or equity in a company. It simply settles for a percentage of the borrowers revenue until the loan is paid back plus interest.

Best thing about this arrangement...they aren't primarily concerned with the payback period.  This takes most of the pressure off of the company's owner. In turn it allows the owner to concentrate on growing revenue during the start-up phase; all while it takes a cut out of that growing revenue. Revenue Loans does, however require up to 5x the amount of the borrowed funds to be repaid. This number may seem a bit too high. But it is a fair multiplier considering the owner doesn't have to give up equity, control, or focus when borrowing.

All in all, we think this is a breath of fresh air for any interested business owners. With the exclusivity of venture capitalism, and the scarcity of banking loans...the repayment structure(revenue based financing) of Revenue Loans seems to be the answer.

Right now Revenue Loans is currently in series funding, but keep it in mind as you search for new funding sources.

CFP vs. Financial Consulting

CFPs (advisors on the sell side) tend to give their clients general advice and recommendations. Even when they personalize the advice, they tend to use software that provides one-time recommendations.

As one of my colleagues says "CFP is showing the client a recipe. While what we do is give the client the recipe and show them how to cook it."

Financial consultants have the ability to pool all of their resources in order to provide the client with the best planning. That's a major distinction. Consultants also aren't promising any type of outrageous returns per year, because they focus more on the long term education. The CFPs...the short term performance. This minor difference separates one losing their clients billions and one keeping their assets safe. Where CFPs are loyal to the client, they tend to have some conflict of interest situations if they work for a discount broker. These brokers give them commission (this is where those hefty bonuses come from) for the profitable trades they make, at the time of the trade. And more times than none, commission is even higher if they use one of the broker's affiliated products. Ever wonder why right before the economic crash banks dished out the largest bonus ever? Financial planners/advisors were selling the riskiest investments in bulk and it collapsed on their heads a short time after. However, even with the hurting market they made their money.

This money that these scrupulous advisors made our now coming back around to attack them. President Obama has now endorsed a $9 billion tax bill, for banks, over the next 10 years that will severely hamper bonuses. For those of you that don't know about the bill, he wants the banks to repay the taxpayers for the TARP money that was dished out during the recession. Even banks that have paid back their part of the TARP will be on the raw end of the deal.

Moreover, the greed of some affected the outcome of all. And now all have to pay for it including the honest and responsible CFPs. Don’t get me wrong, I use CFPs and other financial advisors to refer my clients when they need more specific investment recommendations. However, that’s only because we at Cloud 9 are not authorized to give specific stocks and bonds advice to our clients. People across the world we see more financial consultants (counselors) rise up and capitalize on the public doubts of current CFPs.