Category Archives: 3 Business

Social Media Selling Solutions for Small Businesses

Want to turn your social media accounts into a profitable e-commerce business? Or use Instagram, Facebook and other platforms to boost sales? With social media selling, anyone can become an online merchant without having to invest in a website or give online marketplaces a cut of their profits. Social media e-commerce is a big hit because it lets you turn your social media accounts into online stores — and your posts into sales.

Here are 10 social media selling solutions to help you get started.

Let customers shop your Instagram posts. Olapic offers two solutions that aim to help you sell items and organize your social media marketing campaign. Olapic’s Tapshop turns your Instagram feed into an e-commerce storefront that links individual posts to product pages — you can even link to multiple products from a single photo. Additionally, Olapic’s Content Scheduler simplifies campaigns by letting you organize and schedule Instagram posts for maximum reach and engagement (this feature can also be used on Pinterest). An analytics tool is also available to track performance, conversions and ROI, so you can see what works and plan ahead for future campaigns.

Editor’s Note: Looking for information on social media marketing services for your business? Use the questionnaire below, and get quickly connected to our vendor partners to learn more about a customized strategy and pricing for your business:

Want to monetize both Instagram and Facebook? Soldsie can help. Its Instagram selling solution,, lets followers shop your posts via a unique URL ( Just place the link in your bio to give customers easy access to a shoppable version of your Instagram feed. The Soldsie Facebook app, on the other hand, turns the social network’s comments section into an e-commerce powerhouse. Typically, customers make purchases on Facebook by messaging sellers or leaving their email address. Instead, Soldsie’s Comment Selling system eliminates all the back-and-forth communication by streamlining transactions. All customers have to do is comment under a photo to make a purchase, and Soldsie automatically adds the item to their shopping cart for fast, easy checkout.

Expand your online store with Facebook and Pinterest storefronts. Shopial takes products from your online store and features them on your Facebook Page and Pinterest boards. Just install the Shopial Facebook app into a new tab on your Facebook Page and Shopial will import products into a customizable Facebook shop. Shopial also works with Pinterest by making your products available as optimized Pins, essentially turning your Pinterest into an online catalog.  Shopial integrates with several major e-commerce platforms, including Etsy, Shopify, eBay, Magento, Amazon, Wix and TicTail, making it accessible to most online sellers. The company also offers Facebook Ads services, such as ad design and optimization to help you promote products and reach target audiences.

Even if you own an e-commerce website, cross-selling products on social media is a great strategy to boost sales. One service that makes this possible is Beetailer, which lets online merchants import their store into Facebook. After the initial migration, the system is basically hands-free — it requires no installation, configuration or maintenance, and products are automatically updated based on the website’s inventory data. Included in the service are marketing tools like campaigns and promotions, detailed analytics, and integration with existing checkout systems.

There’s more to hashtags than categorizing and finding similar posts. inSelly, an Instagram marketplace, facilitates the process by aggregating Instagram listings using hashtags, and then making them searchable to anyone around the world. Sellers can list items from their Instagram feed in three simple steps: upload a photo on Instagram, add the hashtag #inselly, and then log in to their account to add product descriptions, prices and other details. inSelly also makes it easy for customers to make purchases. All they have to do is comment the hashtag #soldtome under the Instagram post containing the item they wish to buy. inSelly will then automatically send them a checkout link to complete the transaction.

Chirpify is another hashtag selling tool, but differentiates itself by connecting on- and offline channels with social media. It basically acts as the middleman that connects brands and consumers and instantly convert sales. It works by taking unique campaign hashtags — referred to as “actiontags” — and uses them to enable purchases across multiple social networks. Customers can find actiontags on social media, print, television and other marketing channels. All they have to do is post the actiontag on Twitter, Facebook or Instagram to activate a purchase, participate in a campaign or take advantage of promotional offers, such as giveaways.

Designing Facebook Page campaigns can seem like rocket science for people who aren’t tech savvy. Heyo simplifies the process with a drag-and-drop campaign builder that anyone can use. The service works a lot like do-it-yourself website builders: Start by choosing a template, and then edit or customize elements to fit your campaign and brand. Whether you’re running a contest, sweepstakes, special deals or other promotions, campaigns built on Heyo can then be easily plugged into your Facebook page — no coding necessary.

How to Fraud-Proof Your Business, Inside and Out

Many small business owners mistakenly think that federal fraud regulations cover their business accounts in the same way that these regulations protect personal accounts. However, federal regulations that protect financial accounts from fraud cover only personal accounts, leaving business accounts out in the cold when there’s a cybersecurity breach. There is also very little protection when the source of the fraud is internal, such an employee with too much administrative access and not enough checks and balances in place. Here’s what you can do to keep your business’s bank accounts as safe as possible.

Hackers will often target email accounts to get their victims’ bank credentials. BC Krishna, CEO of online payment solution provider MineralTree, said that small businesses often fall victim to these fraud schemes.

“Small business accounts are the most attractive targets for cybercriminals,” he told Business News Daily. “Personal accounts often have small balances, and large corporations have tighter security, and fraud would be more noticeable. Hackers go after the weakest points in the chain: small businesses.”

Many business owners rely on outdated security tools and strategies that are ineffective against cyberattacks in the first place. Staying on top of current events and being aware of threats in an ever-changing security landscape are the first steps to preventing bank fraud.

“There’s too much trust in the system,” Krishna said. “People need to become more aware that just because it’s not happening in your own backyard doesn’t mean it’s not going to happen to you.”

You can protect your business from outside threats with the following methods:

System integrity. Equip your computers and other system components with the most up-to-date firewalls and antivirus software. This means protecting smartphones, tablets and other mobile devices. Add to the protection level by executing daily backups of critical business data on every computer or server. If you use cloud storage, select a vendor with stringent security guidelines, and know your recourse if there appears to be a breach.

Two-step logins. To manage your bank account online, you generally need only your username and password. If those are compromised, anyone can get in. Set up two-step, out-of-band authentication, whereby a single-use code is sent to your phone or email for you to enter after you input your login credentials. Even if a cybercriminal intercepts that code, it will expire shortly after it’s sent, and your account will remain protected.

Device identification and geofencing. Ensure that your payment system allows transactions only from recognized, registered devices. Similarly, setting up a location-aware system that operates within a trusted geographical region can help keep cybercriminals out of your accounts.

Employee training. Hackers gain entry to your accounts using a variety of methods, including links in what appear to be routine emails from financial institutions or other companies with whom you routinely do business. Train your employees to report any email that looks suspicious. Other training should include running scans on portable storage devices, like flash drives, before opening files, and limiting personal use of company business computers and devices.

The other, and perhaps more dangerous, threat to business owners’ data security comes from their own staff. Internal fraud by employees is very easy to accomplish, so any company without sufficient monitoring systems puts itself at risk. Internal fraud can take the form of theft of money or product, misusing petty cash, or embezzlement. Here are some ways to protect your business from an inside threat:

Separation of duties. Businesses that utilize transaction verifications need to be sure that the person who sets up a payment is not the same person who approves it. This may be a bit of a hassle, but separating these duties will limit the chance of fraud by employees.

Background checks. For any employee who handles cash in hand, accepts payments from customers or clients, or has access to the company accounts, conduct a thorough background check during the pre-employment process.

Automated inventory systems. Theft of product or merchandise is equally as cost-disruptive and prevalent as misuse of funds. Control your inventory and know what you have by using automated inventory systems and frequently conducting spot-checks and partial inventories.

Audits. Using a third-party auditor protects your assets as well. Providing a fresh view on accounts, an auditory can more easily spot anything suspicious, resulting in an investigation as to root cause. Even if the problem is something as simple as an employee using the wrong account code, auditors can both protect your assets and find inconsistencies in procedure. Fixing these errors can improve not only monetary accuracy but also productivity.

Important Steps to Boost Your Business Cybersecurity

Hackers have set their sights on small businesses because they often have weaker cybersecurity and can unknowingly serve as entry points to much larger corporations that they may have as customers. In fact, a staggering 71 percent of cyberattacks occur at organizations with fewer than 100 employees, according to the Small Business Committee.

At the same time, it’s challenging for a small business to keep up with the wide range of potential cyberattacks. Small businesses often don’t know they have become vulnerable to attackers until it’s too late.

To help you navigate this cyberterrain, Business News Daily compiled the top tips and best practices from the pros on how to keep your business from falling prey to cybercrime.

Research has shown that unmanaged administrator privileges are some of the biggest IT security threats to an organization. Yet many small businesses still don’t take the time to set up the proper access limitations for nonadmin employees, especially when those workers are using their own devices. [Cybersecurity: A Small Business Guide]

“Security policies and mechanisms must be put in place for company data access from personal devices,” said P.J. Gupta, a mobile security expert and the founder and CEO of iPlum. “Tight control on who has the privileges to run which enterprise apps from which devices helps minimize the risk of data loss or corruption.”

Gupta recommended enforcing time-window and location-based fencing for controlling access to sensitive information.

Security needs to be an ongoing process and not just a single event, said Marc Malizia, chief technology officer for the managed cloud solutions provider RKON Technologies. The best security consists of a layered approach, he said.

To secure your operating systems, you should perform ongoing tests for vulnerabilities and penetration by hackers, Malizia advised. He also recommended installing specialized security software to look out for abnormal web traffic, block attempted logins from out-of-the-ordinary locations or unknown devices, and authenticate your online activities in real time by correlating behavioral analysis, device profiling and data feeds from fraud networks. Finally, businesses should layer in application firewalls in front of external-facing web servers to further block malicious traffic, Malizia said.

In the past several years, cyberinsurance policies have become an increasingly popular option for small businesses looking to protect credit card information, customer names and addresses, and other sensitive data stored in online systems. Cyberrisks aren’t typically covered under general liability insurance, so it’s important to find out which types of coverage are available.

“Cyberinsurance is not a one-size-fits-all product,” said Tim Francis, enterprise cyber lead at Travelers, a provider of cyberinsurance. “It’s hard to identify what a ‘small’ business is when it comes to the world of cyber. Traditional measures, like revenue and number of employees, aren’t good indicators of how much [risk] a company has in terms of data breaches. A small company can have very big exposure.”

Cyberinsurance isn’t a necessity for every company, but business owners should speak with their insurance agent about their options.

Cybersecurity: A Small Business Guide

Online threats are on everyone’s minds after this week’s breach at OneLogin. The identity and access management company with over 2,000 enterprise clients was hacked, and the fallout isn’t over. During the security breach, private information about users, apps, and various keys may have been obtained by the still unknown hackers. All we currently know is what OneLogin has announced on their company blog: data may have been collected and the hacker or hackers may have figured out a way to decrypt data.

If you’re not sure what all this means you’re not alone, many entrepreneurs don’t realize that small businesses are just as at risk for cyberattacks as larger companies, but they are. According to a report by Keeper Security and the Ponemon Institute, 50 percent of small businesses have been breached in the past 12 months.

Here’s an overview of everything you need to know to protect your business.

While breaches at big corporations such as Target and Home Depot make the headlines, small business are still very much targets for hackers. Stephen Cobb, a senior security researcher at antivirus software company ESET, said that small businesses fall into hackers’ cybersecurity “sweet spot:” They have more digital assets to target than an individual consumer has, but less security than a larger enterprise.

The other reason small businesses make such appealing targets is because hackers know these companies are less careful about security. An infographic by Towergate Insurance showed that small businesses often underestimate their risk level, with 82 percent of small business owners saying they’re not targets for attacks, because they don’t have anything worth stealing. [See Related Story: Cyberattack Risks Remain a Threat to Businesses Despite Insurance]

In almost every case, the end goal of a cyberattack is to steal and exploit sensitive data, whether it’s customer credit-card information or a person’s credentials, which would be used to misuse the individual’s identity online.

This is by no means an exhaustive list of potential cyberthreats, especially as hackers’ techniques continue to evolve, but businesses should at least be aware of the most frequently used attacks.

APT: Advanced persistent threats, or APTs, are long-term targeted attacks that break into a network in multiple phases to avoid detection. This Symantec infographic outlined the five stages of an APT.

DDoS: An acronym for distributed denial of service, DDoS attacks occur when a server is intentionally overloaded with requests, with the goal of shutting down the target’s website or network system.

Inside attack: This is when someone with administrative privileges, usually from within the organization, purposely misuses his or her credentials to gain access to confidential company information. Former employees, in particular, present a threat if they left the company on bad terms, so your business should have a protocol in place to revoke all access to company data immediately upon an employee’s termination.

Malware: This umbrella term is short for “malicious software,” and covers any program introduced into the target’s computer with the intent to cause damage or gain unauthorized access. More about the different varieties of malware can be found on How to Geek. Business News Daily’s sister site Tom’s Guide also breaks down the myths and facts of malware.

Password attacks: There are three main types of password attacks: a brute-force attack, which involves guessing at passwords until the hacker gets in; a dictionary attack, which uses a program to try different combinations of dictionary words; and keylogging, which tracks all of a user’s keystrokes, including login IDs and passwords. More about each type of attack (and how to avoid them) can be found in this Scorpion Software blog post.

Phishing: Perhaps the most commonly deployed form of cybertheft, phishing involves collecting sensitive information like login credentials and credit-card information through a legitimate-looking (but ultimately fraudulent) website, often sent to unsuspecting individuals in an email. Keeper Security and the Ponemon Institute reported that the most prevalent attacks against SMBs are web-based and phishing/social engineering. TechRepublic shared 10 signs to help you spot a phishing email.

Ransomware: Ransomware is a type of malware that infects your machine and, as the name suggests, demands a ransome. Typically ransomware will either lock you out of your computer and demand money in return for access or threaten to publish private information if you don’t pay a specified amount. Ransomware is one of the fastest growing types of security breaches.

Free Encryption Services to Secure Your Business Communications

Keeping up with cybersecurity is an essential best practice to ensure your business’s viability. While modern operating systems generally come with their own hard-drive encryption technology built in, encrypting the data you transmit online can be a bit more difficult. Many entrepreneurs find themselves lacking the technical knowledge, time or money to implement truly effective solutions.

Luckily, there are a number of powerful encryption services available that can secure everything from files to phone calls. Here are a few of the best free encryption services that can help you easily secure your business operations and data.

Signal, an open-source private messenger app developed by Open Whisper Systems, allows Android and iPhone users to easily employ end-to-end encryption for free. There is also a Signal add-on for Google Chrome that syncs your secure communications from your mobile device onto your desktop. Signal supports both private messaging and calling with nothing more than an internet connection, meaning it can effectively replace your default communications apps. However, users on both ends need to be using Signal and be connected to the internet to take advantage of the app’s client-side encryption: 256-bit AES encryption for the content of texts and 128-bit AES-CBC encryption for the content of calls. That means convincing friends and colleagues to install and run the free application as well.

A particularly appealing aspect of Signal is that it employs what is known as perfect forward secrecy, a system that generates fresh encryption keys during each individual session. This means Signal is insulated from attacks, compartmentalizing the content of your communications so that it’s incredibly difficult, if not impossible, to intercept in its entirety. Signal also protects against man-in-the-middle attacks: Its SHA-256 hash authentication prevents a would-be thief from establishing a false, disguised server to intercept your communications.

ProtonMail is a highly secure, open-source email application designed by MIT and Harvard research students, led by CERN researcher Andy Yen. It features both desktop and mobile applications, and the free model supports 2048-bit and 4096-bit encryption. ProtonMail also supports self-destructing emails, which can help you even better cover your digital tracks. In addition, ProtonMail boasts the ability to send encrypted communications to non-ProtonMail users. While ProtonMail is free, it also offers a paid premium service that expands on the basic edition’s features.

“Email that isn’t protected is no more secure than a postcard going through the mail, accessible by anyone while in transit. This is something businesses need to take into account when evaluating their security needs,” Dave Wagner, CEO of encryption service provider ZixCorp, told Business News Daily. “End-to-end encryption … protects email in transit but extends security behind the network, preventing any hackers from accessing email if they break through a company’s perimeter.”

One major downside of ProtonMail is that there are limits to how much you can do with a free account. Free users only have access to a measly 500MB of storage and can only send up to 150 emails a day. However, if you save ProtonMail for your truly important messages and regularly clean up your inbox, this should be plenty suitable to secure your sensitive communications. Otherwise, upgrading to a premium account might be worth the modest cost of 5 euros per month (ProtonMail is based in Switzerland), or 30 euros per month for the Visionary package. You can also purchase specific add-ons to the free edition, such as additional storage space, for less than the cost of fully upgrading.

Hotspot Shield from AnchorFree is a virtual private network that is especially useful for employees who are traveling or likely to connect to public Wi-Fi. VPNs work by creating an encrypted “tunnel” between your computer and one of the servers managed by the company. Hotspot Shield covers your major bases with 256-bit AES encryption, securing your personal information on any Wi-Fi connection, changing your IP address to protect against potential snoopers and hackers, and offering an additional layer of malware protection. It also includes a feature that turns the VPN on automatically when you connect to an unsecured wireless network, protecting you while you’re out and about.

“If you have people out of the office and logging in to (unsecured Wi-Fi), you probably want them using a VPN when connecting back so that traffic cannot be picked up,” said Ermis Sfakiyanudis, co-founder and CEO of B2B technology company Trivalent.

In terms of ease of use, Hotspot Shield is relatively user-friendly, but the interface can take a little while to figure out. Hotspot Shield’s major shortcoming is that you need a paid plan to take your pick of the 20 available countries. Otherwise, you’ll have to accept being routed through the server of Hotspot Shield’s choice. This might not be a big deal, as your activity is still secure, but it is a limitation that users of the free version should consider.


Human Error, Not Tech, Is Often to Blame for Cyberattacks

When it comes to cybersecurity, ensuring software is up to date, data is backed up, and preventative measures like anti-virus software and firewalls are in place is helpful. But one essential ingredient to cybersafety is something less technical: human vigilance.

A new study from the Security Lancaster Institute at Lancaster University examined the role of human error and oversight in creating vulnerabilities to cyberattacks. Based on interviews with academics, consultants and security managers, the study’s results demonstrated that most vulnerabilities were due to inattention related to “biases, gaps and limitations.”

“These included, for example, a bias towards physical security and away from cybersecurity, and a bias towards denying insecurities to avoid embarrassment,” the authors wrote.

Recently, a few high-profile cyberattacks or errors led to the loss of terabytes of data. When the WannaCry ransomware attack ravaged the globe in May, the impact was massive. The U.K.’s National Health Service and a prominent Spanish telecom were among the most prominent networks crippled as a result. However, Microsoft had released an update that addressed the vulnerability two months prior, meaning affected systems could have easily been insulated from WannaCry’s devastating assault. [Want to better protect your business from cyberattacks? Check out our cybersecurity guide for small businesses.]

In another big-time error, a data-mining company hired by the Republican Party to gather information on American voters during the 2016 presidential election accidentally made its database public, revealing voters’ dates of birth, home and mailing addresses, phone numbers, registered parties, racial demographics, and voter registration. This botched handling of personal information wasn’t even the result of a cyberattack; it was merely a serious oversight that divulged data the subjects were likely unaware even existed.

In each of these headline-grabbing data catastrophes, human error and a lack of best practices – not a failure of technology – was to blame. In other words, the systems all worked properly while human users were asleep at the wheel. The good news, then, is that the cause of these errors is easily addressed by redoubling efforts and implementing a new set of rules to ensure those best practices do not lapse again.

“[This study] showed how readily vulnerabilities in attention could be ascribed to simple, general rules that were functional in an organizational setting,” the authors wrote. “The focus should thus be on what is normal, in contrast to the typical technical focus on what is anomalous. This normality of vulnerability is similar to Vaughan’s ideas about ‘normalized deviance,’ and suggests vulnerability often goes unnoticed.”

Cybersecurity isn’t just a matter of upgrading technology, but of placing vigilant guards in the watchtowers. With a coherent set of cybersecurity rules, up-to-date software and the watchful eye of careful administrators, you can rest assured that your network is safe.

Steps to Create Your Social Media Strategy in the workplace of automation?

As digital media overlaps with advertising, more small business owners are paying attention to social media and their overall web presence. At Philly Tech Week 2017, Buffermarketing and social media manager Brian Peters hosted a sold out interactive workshop, Developing a Social Media Strategy as a Team of One. This presentation focused on how small businesses can develop effective social media content without having a huge budget or department.

Amidst a room full of social media managers for different types of businesses, Peters outlined a series of seven steps to creating a strategy plan.

When drafting your company’s social media plan, turn to your mission and value statements. These will help you determine the tone and personality of your social media presence. For instance, will you be using popular hashtags, even if they’re not directly relevant to your brand? What about GIFs? How do you feel about swearing?

Additionally, understanding your mission can guide you to create a series of goals, which can include driving traffic to your website and generating leads. Remember to think of specific numbers when outlining your goals, such as a certain number of leads you’d like to generate.

There are tons of tools and software out there to help you create and manage content. In addition to Buffer, Peters identified Canva for graphics, Trello for project management, IFTTT for automation, Google Drive for data storage and Slack for team collaboration.

Tools like Canva help you create your own graphics where you can add text. Since photos and videos perform better overall on most social networks compared to all-text statuses, more companies are using budgeting for visual content this year, according to HubSpot. If you’re willing to go the extra mile, you can even enroll in online photography or design classes on websites like Skillshare, Lynda and Udemy.

For inspiration, Peters recommended making a list of all the brands you admire and then trying to replicate something they’ve created. He also stressed the importance of seeking inspiration from brands outside of your specific industry and niche.

“There’s a lot of great content out there,” one of Peters’ slides read. “We can all be publishers!”

Curation describes the practice of repurposing pre-existing content you find on the internet. Every time we share a popular meme or GIF on Facebook, we’re curating our Timeline. Like a museum, our social media feeds can be customized to our interests and style.

To follow the best content on the web that’s most relevant to your brand, Peters suggests creating a customized Instagram desktop and Facebook Pages to Watch feed.

Encourage your employees to share content with their social media following by retweeting and sharing relevant company content. If you work with social media influencers, utilize their audiences as well to help spread brand awareness. Why?

“Suppose you’re a mid-size company with a total of 5,000 followers altogether on Twitter, Facebook, Instagram and LinkedIn,” explains Ryan Holmes, CEO of Hootsuite, in a Fast Company article. “Now, let’s say you have 100 employees, each with (a relatively modest) 250 followers of their own, for a total of 25,000 unique followers. By asking your employees to share messages, you can boost your audience (at least on paper) from 5,000 to 30,000 – instantly.”

Have employees been thinking about automation in the workplace?

Despite popular perception, most U.S. workers aren’t worried about being replaced by a robot, new research finds.

The study from Randstad US revealed that more than three-quarters of employees aren’t scared by the prospects of an increased amount of automation in the workplace.

Many workers are actually embracing the influx of automation. The research shows that 30 percent of the employees surveyed think automation will make their jobs better. In addition, as long as they are being paid at least their same current salaries, more than half of U.S. employees are more than happy to be retrained to learn the skills needed to work in tandem with automation.

Linda Galipeau, CEO of Randstad North America, said the study’s results should come as good news for companies that are trying to implement more automation in order to spur on productivity and innovation.

“It is evident from our research that not only are workers not afraid of losing their jobs to automation, they are more than willing to retrain to leverage the efficiencies and benefits of artificial intelligence (AI) and robotics in the workplace,” Galipeau said in a statement. “As we have known for quite some time, the success of organizations in the future will depend greatly on their ability to strike a balance between valuable human insight and interaction with technology.”

Despite the belief that automation will push many workers out of a job, the vast majority of executives disagree. Just 6 percent of the company leaders surveyed believe increasing automation will have a significant impact on workforce planning and shifting the talent needed. [Looking ahead? The job skills you’ll need in the future]

To ensure that their jobs don’t get replaced, Galipeau says employees need to make sure their skills complement the automation being put into place.

“It has become necessary for today’s employees and job seekers to continually cultivate, develop and update their skills to work successfully alongside AI and automation,” Galipeau said. “In conjunction with retraining and upskilling efforts, workers should focus on growing unique human skills that AI and robots are unable to replicate, such as strategic and abstract thinking, complex communications, creativity and leadership competencies.”

Many organizations are looking forward to seeing how increased automation can improve their operations. Nearly 85 percent of executives believe AI and robotics will have a positive impact on the workplace in the next three to five years.

Automation and robotics have already taken hold in a number of businesses. Nearly half of the executives surveyed said automation and machine learning has either transformed or had a positive impact on their businesses over the last year, with 45 percent saying the same about robotics.

Galipeau said the reality is that automation and AI are not only here to stay, but will grow substantially in the coming years.

“As business leaders invest in digitization, automation, AI and other emerging technologies in the workplace, they must continue to evolve their workforce alongside these advancements,” Galipeau said. “While the productivity and efficiency benefits of automation are unequivocal, the need for skilled humans to operate, utilize and advance technologies is equally unmistakable.”
The study was based on online interviews with 5,300 U.S. residents between the ages of 18 and 65.

Explore the Ups and Downs of the Gig Economy

The rapid rise of temporary work arrangements, collectively known as the gig economy, has offered people flexible working arrangements and a way to make extra money with the push of a button. This rising sector of the American economy has been lauded and denounced with equal fervor: Proponents say the gig economy creates additional opportunity, while detractors claim gigs represent a specific type of exploitation.

Regardless of perspective, gigs are disrupting longstanding industries and changing the relationship between worker and employer. As the gig economy becomes more prevalent and spreads across more industries, the waters have become muddier. Here’s a look at what the gig economy means for workers and companies as well as how to land a “good gig.”

Gig work comes with a set of pros and cons for workers. To start, gig workers benefit by gaining more latitude over their schedule and the type of work they create. That independence is refreshing for some workers, said Steven Soares, senior vice president of technology at professional staffing service KForce.

“For those working in the gig economy, this lifestyle provides more flexibility in that those working a ‘gig’ can work where they want, how they want and when they want,” Soares said. “This appeals to many, including our large millennial workforce.”

The other side of the coin isn’t so glamorous. Gig workers also run the risk of inconsistent employment, meaning they must either chase down their own freelance work or hustle in the on-demand space. [How will automation impact workers in the gig economy?]

“When working in the gig economy, sometimes you do not feel the stability that you have if you were to work for a company,” David Zamir, founder of home service gig company, said. “You do not know if you will have daily jobs, and this uncertainty is not for everyone.”

Another drawback, Zamir said, is that gig workers have to keep track of their own taxes.

U.S. SEC Expands the “IPO On-Ramp” Provision of the JOBS Act

The U.S. Securities and Exchange Commission (SEC) is expanding a popular provision of the Jumpstart Our Business Startups (JOBS) Act that allowed “early growth companies” (EGCs) – generally those with annual revenues under $1 billion – to file materials related to an initial public offering (IPO) confidentially before officially filing public materials. Now that process, known as Title I nonpublic draft registration statements, is being extended to all companies considering going public with an IPO.

The benefit of a nonpublic draft registration statement is that companies can decide to pull back on their IPO – whether its due to changing market conditions, revisions or any other reason – without signaling to the public at large that the company hesitated to move forward with its public offering, David Hooper, corporate attorney at the firm Barnes and Thornburg, told Business News Daily.

“Before [the] JOBS Act, if a smaller company was going public and made their filing … available for everyone to see and the IPO was later pulled, that was a pretty negative connotation on the company itself, and the market typically looked at that as there must be something fatally wrong with this company,” Hooper said. “But oftentimes companies may pull an IPO for other reasons. It’s seen as a significant benefit to those companies to give them the freedom to potentially terminate an IPO process – or revise, or delay, or test it – to see if market would be able to absorb the offering or have an adverse reaction to it.”

According to Ernst & Young’s JOBS Act update, 87 percent of the emerging growth companies (EGCs) that have filed IPO registration statements since Title I was enacted have taken advantage of the confidential registration statement SEC review process. Now that the process is open to all companies considering filing IPOs, the SEC is hoping to see more companies going public.

“This is an important step in our efforts to foster capital formation, provide investment opportunities and protect investors,” said the SEC’s Director of the Division of Corporation Finance, Bill Hinman. “This process makes it easier for more companies to enter and participate in our public company disclosure-based system.”

While the SEC’s new policy expands confidential filing from EGCs to all companies mulling a public offering, it does not exempt larger companies from other disclosure requirements not applicable to EGCs. For example, Hooper said larger companies still require three years of financials, while EGCs only require two.

“The relief that was provided to the non-EGCs is limited in certain aspects as it compares to the EGCs … so a number of other provisions in [the] JOBS Act for EGCs doesn’t necessarily apply to relief to other companies,” Hooper said. “If you’re a company with $5 billion in revenues, you still have to provide the full disclosures that you otherwise would have had to provide.”

Ultimately, though, Hooper said market conditions at large and by sector tend to drive the amount of IPOs seen in a given year. While the changes make it easier, there are many factors to look out for; still, Hooper said, he expects the SEC’s policy update will give the number of IPOs a boost.

“Under these current market conditions, I think this provision would have a positive effect on [the] number of IPOs coming to fruition,” Hooper said.

The SEC echoes those sentiments. SEC Chairman Jay Clayton said in a statement the overarching goal of the policy update is to streamline the process by which companies go to the public market for capital. While larger companies are still required to abide by the more stringent disclosure requirements, they will have the flexibility to test the waters with a nonpublic draft registration statement – a noncommittal investigation of the IPO process.

“By expanding a popular JOBS Act benefit to all companies, we hope that the next American success story will look to our public markets when they need access to affordable capital,” Clayton said. “We are striving for efficiency in our processes to encourage more companies to consider going public, which can result in more choices for investors, job creation and a stronger U.S. economy.”