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For the past month, the Commercial Data Sciences team in Business Information Services has been taking precautions in response to the Coronavirus Pandemic, working from home. In the span of the past five weeks, we have seen the spread of the disease ramp up, and the death toll climbs. The impact on businesses of all sizes will be immense. In just a few days we built a robust simulator tool that helps businesses assess the impact of COVID-19 as the disease spreads. With this tool, you can: Identify risk in geographies you do business in Based on geography, review the top 5 riskiest industries for that region Apply an impact scenario so you can plan for the best and worst-case scenarios The U.S. business risk dashboard below was developed by Experian Business Information Services to help businesses better understand the impact COVID-19 may have on their commercial operation based on several key factors. This methodology combines business risk, anticipated impact on business industries and real-time COVID-19 case data to help businesses better simulate various impact scenarios down to the state level to help develop enterprise strategies. A paid version of the dashboard goes down to the county and industry level. The risk index is used as a comparative benchmark across states, counties and industries. Industry classification is used to assess the business’s level of exposure due the nature of the business. For example, businesses in the Arts, Entertainment, and Recreation industries will be more heavily impacted than businesses in Public Administration. The risk index represents the credit risk, industry risk, and COVID-19 risk on businesses across the U.S. The impact layer allows users to easily change the severity of the impact related to the combination with the credit risk, industry risk, and COVID-19 risk across regions and industries. This dashboard is meant to be a directional tool for assessing which industries and geographies are most likely to be impacted and how severe the impact will be. The risk index is not designed to be interchangeable with a traditional credit risk score. The risk index is intended to be used independently to gain insights around the potential impact of the current events on future business credit health at summarized levels including region and industry. The risk index has four different assessment scenarios ranging from low to severe. If the expectation is that various industries are affected differently, but the impact overall is minimal, then the minimal scenario should be applied. Select the other scenarios to amplify the impact.  

According to the Kauffman Foundation Index of Startup Activity, only 0.31 percent of U.S. adults ever starts a business. That's 310 people out of every 100,000. That's a shocking statistic for a country of 325 million people. In fact, new business starts have been in a slow, steady decline since the late 70's. Source: Kauffman Foundation In 2015, just over 600,000 new businesses were established in the United States. These businesses created 3 million jobs, and because the average new business had roughly 4.5 employees, almost all fit the profile of an american small business. In a July hearing by the House Committee on Small Business titled "Reversing the Entrepreneurship Decline", Representative Steve Chabod of Ohio, and ranking member Nydia M. Velazquez of New York, along with members of the house panel, set out to understand why the number of startups is declining by hearing testimony from leading experts on the subject of entreprenurship to identify possible solutions. The panel of experts included Dr. Gregory Crawford, President of Miami University's Farmer's School of Business, who told how Miami gets students involved with local startups by maintaining a permanent presence at Cintrifuse in Cincinnati. Cintrifuse is a start-up catalyst, a public/private partnership that exists to build a sustainable tech-based economy for the Greater Cincinnati region. Also, through the San Francisco Digital Innovation Program, which enables students to spend entire semesters living in Silicon Valley. Four days a week, they are in an apprenticeship at a start-up. Like any nascent entrepreneur, they do everything from ideation to product development to cleaning up the office at the end of the day.  It must be working, Forbes recently wrote an article titled "Why Ohio Is The Best State in America To Launch a Startup" featuring two Miami graduates who went on to found OROS Apparel.  Karen Kerrigan, President of the Small Business and Entrepreneurship Council cited several trends uncovered in a Gap Analysis study by SBE Chief Economist, Raymond J. Keating. The study found that over the course of the last decade, the economy has developed a gap of roughly 3.7 million businesses, businesses which would have existed, if only people had started them.    Joe Schocken, CEO of Broadmart Capital spoke about the effects of globalization and automation. The economy is struggling to absorb the impacts of automation and globalization, and now sees companies disappearing at a faster rate than new companies are forming. A recent study by Forrester Research projects that automation and robotics will displace nearly 25 million jobs, or 17 percent of the workforce by 2027, and cause a net job loss of 9.8 million.  During her opening remarks, Representative Velazques pointed out "in New York, nearly half the small businesses are owned by immigrants, and nationally,  immigrants make up approximately 30 percent of new entrepreneurs."  Nationally, more than half of the startups valued at $1 billion or more were founded by immigrants, and more needs to be done to foster entrepreneurship   Access to capital was a constant during this hearing, being mentioned several times as a leading barrier to success in stimulating growth in startup creation.  New businesses must spend a great deal of time and energy on finding capital, rather than executing their business plans, and too often this capital is simply unavailable.  The problem is particularly pronounced for traditionally disadvantaged demographics such as women and minorities. Representative Velazquez cited one study which noted if minorities started businesses at same rate as non-minorities we would have 1 million additional employers, generating 9.5 million more jobs for our local economy. In recent years there has been a decline in the number of venture firms.  Remaining firms have focused their efforts on a few key states. Since the 2008 recession, 50 percent of new businesses have originated in 20 of 3,100 counties scattered across the United States. In California, venture funds increased as a percentage of total U.S. fundraising from 57 percent in 2015 to 66 percent in 2016.  More needs to be done in reaching entrepreneurs in other parts of the country.   The panel focused on several areas where Government could help, answering questions and offering suggestions. Karen Kerrigan said regulatory relief, tax reform and improving access to capital were key areas where reform could help.  An enrepreneur's first
 touch
 with 
regulation 
mostly
 begins
 at 
the 
local 
and
 state
 level
 where 
they
 are 
met 
with 
licensing, 
zoning, 
registration, 
fees 
and 
other
 regulations that 
are 
often
 burdensome
 and costly 
for
 starting
 a 
business. She also said our
 tax
 code
 needs 
to
 be 
internationally 
competitive 
and 
designed to 
encourage
 growth. 

Growth 
breeds 
confidence,
 optimism
 and 
entrepreneurial 
opportunity. By improving access to capital by relieving 
community 
banks 
of 
unneeded
 regulation, 
and 
modernizing
 and
 streamlining 
an 
array 
of 
Security 
and
 Exchange 
Commission 
rules 
and
 compliance 
requirements, small businesses and entrepreneurs will have a wider array of financing options in addition to new ways to finance their venture such as crowdfunding. Mr Schocken offered several ideas focused on streamlining equity crowdfunding, removing barriers and restrictive regulations and also improving inter-agency cooperation on globalization and automation saying, most of the jobs that will replace jobs lost to automation would likely come from small business, so the formation of a special commission focused on the innovation economy would be a great idea.  You can watch the full video of the "Reversing the Entrepreneurship Decline" house panel session below.  

In just one week, Augmented Reality (AR) proved itself to be the Next Big Thing in popular entertainment. Within days of Niantic Labs release of Pokémon Go, in which players "hunt" and "capture" fantastical creatures using their smartphone cameras, tens of millions of Americans have become hooked on the game. According to media reports, the app has already been installed on twice as many phones as Tinder™, is used twice as much as Snapchat, and is surpassing the all-powerful Twitter in its number of daily active users. The skyrocketing value of parent company Nintendo's stock price has provided further testament to the game's perceived long-term stamina. Beyond its nostalgia value -- the game is based on the popular Japanese cartoon and videogame series from the 1990s -- Pokémon Go is winning over hearts, minds and dollars due to its artful blending of fantasy game play and real-world locations. To play the game, participants must move through the physical world, often traveling many blocks or even miles in search of their elusive digital prey. Such material engagement -- and the physical exertion required to complete many of the quests -- is a far cry from the sedentary "couch potato" stereotype so long associated with video-gaming. Marketing opportunities for local businesses It's also offering surprisingly lucrative marketing opportunities for many local businesses. Shops, restaurants and other commercial operations who find themselves near one of the game's many "Pokéstops"(virtual pit stops) and "gyms" (digital combat arenas) are seeing a marked uptick in foot traffic. Many stores are actively advertising via social media their proximity to game elements and the Pokémon that players have found nearby. Chicago's famed Art Institute received wide coverage for their boasting of various Pokémon found within their hallowed galleries, complete with iPhone screen shots of cartoon monsters perched amidst the Renoirs and Chagalls. Pokémon have invaded the Art Institute! Catch them if you can and find 14 PokéStops around the museum. #PokemonGO pic.twitter.com/MICPddACuf — Art Institute (@artinstitutechi) July 11, 2016 Assuming the appeal and popularity of AR is more than just a passing summer fad, the short-and long-term potential for local businesses appears to be huge. For example: Referrals: A referral program is one fast and easy way for local businesses to take advantage of the Pokémon Go phenomenon. For example, shop owners can offer to play for players' "incense," a virtual commodity used to attract the game's creatures, in exchange for the use of screenshots showing rare Pokémon that show up near their establishment. They can offer players similar rewards for store photos and check-in’s that players post on social media sites such as Yelp or Facebook. Shops can even offer game-based "bounties" for the capture of Pokémon found in or near their stores, thus driving up foot traffic. Local Sponsorships: Seeing a cash cow (or cash chiamander) when they see one, Niantic, Inc., is reportedly developing a program that will allow local businesses to actively sponsor themselves as Pokéstops or Pokémon hiding locations, virtually forcing eager monster-hunters through their doors. Sponsors will be charged on a "cost per visit" basis -- similar to "cost per click" fees on the Internet -- according to Niantic CEO John Hanke. National Sponsorships: As the success of Pokémon Go spurs the creation of other AR games and experiences, national sponsorships may provide developers with yet another, highly lucrative source of income. "National branding could be huge," said Mark Schaefer (@markwschaefer), globally-recognized speaker, educator, and business consultant. "Imagine, a Pokémon character drinking a Coca-Cola. That would be hilarious. The Nintendo stock price went through the roof because of that very idea." But such commercialization of the Pokémon Go experience must be done with discretion, according to Schaefer. "The whole Pokémon Go game experience is built on passion for this product; passion and trust," he explained. "Most players loved Pokémon as children. It's an emotional trigger. If the game starts to look like a NASCAR jacket, with ads all over it, people are going to reject it. But I think that, in this day and age, people expect a certain amount of sponsorship. There can even be a certain amount of surprise and delight associated with sponsorships. The key is to make such sponsorships integral to -- and in the spirit of -- the game itself." In a sense, Pokémon Go is the "Space Invaders" of AR, a breakout game that serves as a "proof of concept" for a whole new entertainment platform. Expect more, increasingly immersive and engaging games that seamlessly blend the physical and virtual worlds to follow. And with them, more opportunities for businesses large and small to generate real-world business by becoming part of the gaming experience. If you are a local business looking for some creative ways to capitalize on the Pokémon craze, check out Fundera's great blog post - How to use Pokémon Go to Drive Business.