Health Care Woes Continue

Rising health care costs hit all Americans and all American companies in the pocketbook, but microenterprises (with less than 10 workers) are among the most hard-hit. A new survey from the National Association for the Self-Employed (NASE) tells the depressing story. NASE surveyed more than 600 small business owners to assess how they deal with rising health care costs. The survey found that a majority of surveyed firms (51.1%) of firms do not now offer and do not plan to offer health care coverage for themselves or their employees. Cost is the primary inhibiting factor, and, not surprisingly, the smallest firms are most affected by these costs. Firms with less than ten employees spend roughly 4% of total gross revenue on health care. Sadly, the situation may be getting worse. Eighty-five percent of respondents noted that their health care premiums had jumped in the past year, with a median increase of a whopping 17.3%.

To view the September 2005 report, Health Coverage and the Micro-Business: A National Perspective, from the National Association for the Self-Employed, click here.

Businesses Don't Know Facts On FACTA

More than three months after the latest provision of the Fair and Accurate Credit Transactions Act (FACTA) went into effect, a survey by zTelligence and Fellow's Inc. showed that small-business owners are still unfamiliar with FACTA and the significant impact it can have on their businesses.
Passed in 2003, with the most recent provision going into effect June 1, 2005, FACTA requires businesses of all sizes to help prevent identity theft by destroying personal information before disposing of it. FACTA also applies to small businesses and even individuals who collect certain personal information from employees or customers, including credit reports and social security numbers.
The results from an online poll taken in July of 2005 of over 500 small businesses found very few businesses are aware of FACTA. When asked what acts or regulations they had heard of, FACTA was recognized by only 13.1% of respondents.
Small business owners can find out everything they need to know about FACTA by visiting www.fellowes.com. The site features an online resource guide for FACTA information and suggests ways businesses can ensure compliance.

Angel Investors Remain Bullish

The angel investment field has continued to cruise ahead in the first half of 2005, according to new research from the University of New Hampshire’s Center for Venture Research. The Center’s tally of angel investing numbers in the first two quarters of 2005 finds that total investing levels reached $11 billion, on track to match last year’s total of $22.5 billion. A total of 126,000 individuals made angel investments over this period; this figure is a slight drop from last year. Angels continue to focus on early stage investing, with 48% of investments occurring in the start-up or seed stage. The research also identifies a large market of “latent angels” – individuals who are members of angel groups but who are not making investments. In fact, 66% of angel group members are latent angels. The researchers suggest this growing number of latent angels is a symptom of the large number of newly formed angel groups, and they recommend additional investor education to help latent angels become active investors.

To read The Angel Investor Market in 2005, Q1 and Q2: The Angel Market Sustains Investment Levels, by Jeffrey Sohl, of the University of New Hampshire’s Center for Venture Research, click here.