Way To Grow
Looking for an edge to outdistance your competitors? A recent survey of 434 CEOs of some of America's fastest-growing companies found that offering stock option plans to employees as well as managers helped businesses grow 51 percent faster than firms offering the plans only to management.
The 1996 study by Coopers & Lybrand LLP found 55 percent of firms offering stock option plans give them to employees and management; 42 percent offered them only to top management.
"Stock options are a vehicle companies can use to provide incentives to employees to work toward a common goal," says Pete Collins of Coopers & Lybrand, adding that these programs are typically more prevalent in high-tech industries. "This is because these companies start out more thinly capitalized and are really making a bet on the future of the business. They are asking their employees to share in the bet and the future."
Among those companies with broad stock option plans, the survey found 29 percent offered them to all employees, 7 percent included more than half their employees, and 19 percent offered the plans to less than half their work force.
Easy Does It
If you want complicated advice on how to find the best mutual fund for your money, don't look to The Neatest Little Guide to Mutual Fund Investing (Plume/Penguin) by Jason Kelly. The apex of simplicity, this pocket-sized tome is aimed at people who simply want to know how to reach a financial goal such as retirement or a college fund.
"I estimate it will take people about half an hour to catch on to how to pick a mutual fund after they read my book," says Kelly, a former technical writer who got interested in mutual funds in college when he noticed his mother's fund was failing to keep pace with inflation.
"The information you need to put together a market-beating mutual fund is as close as your grocery store. That's where you'll find magazines that rank all the funds every year," says Kelly, who also publishes a newsletter on mutual funds, The Neatest Little FundLetter.
In addition to telling you how to evaluate and invest in a mutual fund, Kelly's book highlights 20 fund companies he believes are good bets and includes their phone numbers. There are also work sheets to help you determine your financial goals and assess funds.
Improving The SCOR
Small corporate Offering Registrations (SCORs), which offer an easier way for small businesses to go public, have become so popular that several companies offer products and services to help entrepreneurs through the process.
Denver-based DataMerge Inc.'s software program, Raising Capital Through SCOR, walks business owners through the SCOR filing process. The program includes the standard U-7 filing form as well as all other documentation needed. Spencer Kluesner of DataMerge says the software translates the legalese on the forms into plain English.
An accompanying manual includes complete offering packets from companies that have successfully raised money through SCOR. It also contains background on SCOR rules and regulations, a list of state securities administrators, a state-by-state review of SCOR requirements, and suggestions on pricing stock. The cost is $338 for small businesses; for more information, call (800) 580-1188.
Once you've filed your SCOR, EquityDirect! Inc. helps you take it to the next level. The Angel Fire, New Mexico, company provides a variety of services to help make your offering a success, including advertising it on the Internet and helping you set up an escrow account to collect funds from interested subscribers.
Once you've reached the targeted amount, EquityDirect! prints stock certificates to mail to subscribers, who at that point become shareholders. EquityDirect! also manages any transfers or other transactions, such as dividends, and handles IRS 1099 forms and reporting.
Company president Rich Wildgrube says the cost to set up an escrow account and have EquityDirect! manage subscriptions ranges from $3,000 to $8,000; the cost to handle ongoing stock activities averages about $300 annually. For more information, call (505) 377-6475.
Coopers & Lybrand LLP, (212) 259-4461;
DataMerge Inc., 1720 S. Bellaire St., #310, Denver, CO 80222-9425, (303) 757-6298;
EquityDirect! Inc., Drawer 606, Angel Fire, NM 87710, (505) 377-6475;
Jason Kelly, 11032 Moorpark St., #17, N. Hollywood, CA 91602, (800) 339-5671.