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Banking on the Internet

by Mike Taylor, MBA ’13 Banking-business woes are as high as they’ve ever been. Bonuses at large Wall Street firms are plummeting as Occupy Wall Street protestors give voice to a profound public mistrust of financial institutions. Meanwhile, implementation of the Dodd-Frank Wall Street Reform and Consumer Protection Act contributes additional regulatory uncertainty. Amid all the turmoil, the Bank of Internet (BOFI) is thriving. Helmed by CEO Greg Garrabrants, BOFI is on an expansionist tear. The Internet banking firm has not reported a quarterly loss since November 2008. It currently employs more than 200 people, up from 90 in June…

Startup Profile: GoFundMe

Funding for Your Dreams by Frank Wang, MBA ’13 There’s no doubt that the Internet has changed the way in which entrepreneurs pursue opportunities. By going online, anyone can start a business from their computer — whether it’s selling products or providing a service. However, in order to do so, you still need capital to get started. Gofundme.com, a San Diego, California-based technology startup, looks to provide just such a channel to entrepreneurs. The premise of GoFundMe is pretty simple: people have dreams or goals, but they need money to attain them. After creating an account on the GoFundMe.com website,…

Sparking Innovation

by Ben Doctor During his 2011 State of the Union address, President Obama called attention to America’s proclivity for innovation: “What we can do, what America does better than anyone, is spark the creativity and imagination of our people.” President Obama praised the visionary leadership of Americans such as Edison and the Wright brothers and of companies such as Google and Facebook. He proclaimed that “in America, innovation doesn’t just change our lives. It’s how we make a living.” Of course, re-sparking a surge in American innovation is easier said than done. An Incubator for Fresh Ideas When President Obama…

Lessons Learned from the Financial Crisis

An interview with Nobel prize-winner Harry Markowitz by Zach Jackson In the early part of the 21st century, growth in unconventional financial activities such as over-the-counter trading, structured products and quantitative strategies were meant to increase market efficiency and cater to investor demand. Inherent in many of these activities were existing academic frameworks applied empirically. Since the second half of 2007, however, we have witnessed unprecedented volatility and subsequent decline in capital markets from excessive leverage and contextual abuse of some of these frameworks. Now that the dust has begun to settle, focus is on recovery and understanding the new…

Entrepreneurs in the Cloud

Technology entrepreneurs explore cloud computing as a startup resource and a scalable business by Steven Craig You’re a budding entrepreneur. You’ve got an idea that will fundamentally change your industry. Although you’ve done your research and discovered your customers, investors won’t look at your business plan. Your product isn’t proven, your bankroll is limited and you have to move fast. As you ponder your dilemma, you fortuitously see a television commercial for Microsoft… “To the Cloud,” it proclaims. But what is the cloud and why should you go there? Further, can you even take your fledgling business to the cloud…

The Value Investing Philosophy

An interview with Charles H. Brandes, Chairman of Brandes Investment Partners by Bosco Lujan Imagine someone giving you a formula for investing that has not only withstood the test of time, but that has also been the foundation around which Warren Buffet, one of the world’s savviest investors built his empire. Originally developed in the early 20th century by Benjamin Graham (Buffet’s mentor) and David L. Dodd, value investing is defined as buying shares of a company at a price that is substantially lower than the company’s fundamental or underlying value. The result is the margin of safety, which represents…

It Pays to Play

The burgeoning video game industry in San Diego by Joe Dodson San Diego is known for its health care and defense industries, but perhaps its best kept secret is a thriving video game industry. From small independent studios to major publishers, San Diego has it all, as a closer look at two local video game companies proves. Meet The Behemoth: a small, independent developer that produces what it calls “hand-crafted” games. Their model of light, low cost production has perfectly overlapped the emergence of radical new gaming markets, leading to millions in sales. They’re doing big things with small games.…

Executive Compensation in an Era of Fiscal Irresponsibility

The origins of the Dodd-Frank Reform Act by Berna Kamyar, J.D As the financial crisis of the late 2000s proceeded through its worst stages, numerous accounts emerged detailing the reluctance of executives to moderate their lavish pay packages. Despite hard times, boards of directors continued to approve highly lucrative payments for executives while paying little regard to the plights of rank-and-file workers. Professor Shivaram Rajgopal, a professor at the Goizueta Business School of Emory University whose research activities center on executive compensation, put the situation this way: “Look at Larry Ellison (CEO of Oracle). He earns so much money, does…

Barriers to the mHealth Revolution

by Ashley A. Van Zeeland, Ph.D. More than 100 million Americans are living with at least one chronic disease and if current trends continue, as many as one in three U.S. adults will have diabetes by 2050. In 2009, the U.S. spent more than $1.7 trillion on chronic disease care and by 2010 health care accounted for 17 percent of the U.S. GDP, rising at a rate 2 percent above the overall economy’s growth rate. Faced with these numbers, it is clear that the public health burden of chronic disease will cripple the health care system unless drastic changes are…

Intuition Can’t Beat Experimentation

by Professors Ayelet Gneezy and Uri Gneezy In the summer of 2009, we received a call from Joe, a winery owner in Temecula. Joe asked for our help pricing his wines – clearly one of the most important decisions he needs to make. We were happy to go visit Joe, taste some wines and possibly help him in the process. When we asked him how he’d chosen prices in the past, we encountered the usual suspects: looking at how other wineries price similar wines, intuition, inertia, etc. Joe expected the business professors to come over, look around, do some quick…