`LIFESTYLE entrepreneurs' is not a term of endearment for scions of the fashion industry. It refers to entrepreneurs who run their companies as an extension of their lifestyle. You know who they are. They drive fancy company cars and their entertainment budget runs into five or six figures.
What's wrong with that? Nothing, IF the company is doing well and the business plan is on track.
I don't remember when I started using the term `lifestyle' but I do remember the instances when it aptly described the situation; like the CEO who was buying expensive art for the office whilst the CFO was scrambling to keep the company afloat. I also remember the time that another CEO bought himself a brand new BMW right after being funded, but the BMW was never listed under "Use of Proceeds" before the financing. Care to add your own experience or story? Email me and we'll compile it for the benefit of all.
Still not clear on the terminology? Think of it as your least favourite relative coming to stay with you for an entire month and mooching on you. Well, that's how I feel when we finance an entrepreneur that applies our funds to frivolous personal needs before the company has even justified being funded in the first place. It's another thing if the company demonstrates increased sales, greater productivity in operations, or even beat projections! Well that's only the obvious part of a lifestyle entrepreneur.
What is not obvious is the missed opportunities and careless forays that a company undertakes under such leadership. Such an entrepreneur shuns a takeover even if it means that every shareholder could realise a very nice return, because it might mean giving up a certain lifestyle accorded to his position as CEO. Forget about entering new markets where the company and the CEO is a virtual unknown. Heck, why give up the comfort of being the local Tai Pan in a small market for the headaches of competition in a large market. So what if profits are declining, the local market is good for another two years you say and after that it's the next guy's problem.
Is this starting to sound more and more familiar? Ever been to a dentist who time-shares his hands amongst five patients, flitting from one patient to the next so as to avoid any idle time? Ever sat unattended in your chair with your mouth braced wide open while he fixes another patient's teeth? Just hope that your jaw doesn't lock up! The dentist is entitled to make a decent living, but that doesn't mean that we have to be put out for his benefit.
The term lifestyle therefore does not apply to entrepreneurs alone. It can be applied to various occupations and professions including venture capitalists, doctors, engineers and civil servants. It's a morphing of one's company or one's operations to one's own image, and not necessarily for the benefit of the stakeholders, be they shareholders, employees, suppliers, or investors.
But this article is about entrepreneurs so let me mention some other types that I have come across such as the `Wheeler Dealer'. This guy has so many deals going that we don't quite know what deal he is actually asking you to fund. But one thing is for sure, anything he recommends comes with something for himself although you won't know it.
Notwithstanding, the wheeler dealer is much more preferable than the `Crook'. Nothing is what it seems with this guy and forging a bank document is simply a test of penmanship to him. There is absolutely no easy way to deal with a crook or to be prepared for one because the crook has set his mind at the outset to deceive you. If you got hooked into giving him money, don't settle into complacency thinking that you are protected by whatever agreement you have signed. So don't delay taking action, sue and/or get the police involved.
Another type of entrepreneur you will encounter is the `Job Hunter'. He figures that if he can't get a job he might as well dream one up. Finally, the one that we like is the `Driven' one. This is the guy that is `on a mission'. Sure he wants to make money but that's not all. This guy wants to prove the naysayers wrong, that his idea is sound, that it's worth mortgaging his house, that sleep is a luxury, etc. If you're out there with a great idea, you're driven and you are honest, MSCVC wants you!
What makes entrepreneurs different?
Integrity: Entrepreneurs stick to their principles even
when the going gets tough
Initiative: Entrepreneurs plan long term -- over a year
ahead
Commitment: Entrepreneurs have a tremendous capacity
for gruelling hard work
Drive and determination: Entrepreneurs are motivated by beating
standards of excellence
Directness: Entrepreneurs do not tolerate poor
performance
Confidence: Entrepreneurs have an infectious self-belief
Self-direction: Entrepreneurs focus on areas they find
exciting and don't dwell on failures
Selling: Entrepreneurs use their energy, enthusiasm
and vision to persuade and sell to others
Leadership: Entrepreneurs' leadership skills focus on
the ability to spot talent and to inspire
others to buy into their vision
Source: What makes a great entrepreneur? Chris Dyson, director, Hay
Group. Call 020 7881 7065
Link Building, The Fuel Of Search Engine Optimization
Minggu, Agustus 31, 2008 | SEO with 0 komentar »If you are itching to perform some search engine optimization on your website or your company’s website, you probably already know that link building is a vital component to effective SEO and gaining high search engine rankings. Link building is simply the practice of acquiring links from different websites of relevant or non-relevant content. Every search engine, especially Google require either a large amount of non-relevant backlinks or smaller amounts of relevant backlinks for greater search engine rankings. This makes searching and finding backlinks to your website one of the most significant factors in search engine optimization. If you didn’t know already, higher search engine rankings will lead to more targeted search engine traffic.
There are two types of SEO that need to be performed when building a campaign. There are on page factors and off page factors. Links pointing from another site to your site is one of the greatest controlling off page SEO factor in the game. One thing about link building that most people realize is that, link building takes a lot of time and effort and is an ongoing process. It is often difficult for website owners to carry on a productive link building campaign throughout the life of their website.
Over the years, there have been many different techniques designed for ways to get links and build your search engine rankings. Most techniques are actually good and create an advantage for your website. Others are terrible and corrupt and can destroy the reputation and search engine rankings for a company.
Sadly there are link building methods that are considered “black hat”. Black hat seo techniques are looked down upon in the industry. Masking is one of the more common techniques that show the search engine crawlers different content than that shows to actual visitors of the website. It also comprises of secret material that visitors cannot see. This is the number one reason why search engines do not give more authority to those sites that simply have a lot of links. They also look at the quality of links and award more value to those types of links.
There are many different ways to gain backlinks to your website that are not considered black hat. These are the types of links that you will want to get and focus your campaign around.
- Article writing and marketing
- Directory submissions
- Blog commenting
- Link trades
Focus on these and watch your search engine rankings begin to soar!
Search engine optimization or SEO is the hottest way to drive targeted traffic to your website. Maximizing the benefits of a well optimized website will yield lots of earnings for the marketer. However, optimizing your site might cost you thousands of dollars if you are not skilled in this area.
But to tell you the truth, you can essentially get information on low cost SEO anywhere in the Internet. But only several really show you how to work out an affordable search engine optimization endeavor. And those few that really inform include this article.
1. Link exchanges
One cheap SEO method that can get you best results is through link exchanges or linking to and from other web sites. Depending on the websites that you would like to exchange links with, this tool could even cost you nothing at all. Contact the author or owner of the web site you want to have a link exchange with. You will be surprised with the eventual spiking up of your page ranking using this means of getting your website optimized.
2. Write or acquire key word rich articles
Writing truly informative and keyword-rich articles is one surefire way to make your Internet business more visible than ever. It’s either you write your own articles or you get them from article directories that allow you to post these articles on your website as long as you keep the resource box or the author’s byline in tact. Just don’t stuff your articles with keywords that even idiots would get bore of reading them. The readability and freshness of your articles will still be the basis of whether your writers will keep on coming back to your website or not.
3. Catchy Domain Name
What better will make your target visitors remember your website but with a very easy-to-recall domain name. Something sweet and short will prove to be very invaluable. Registering your domain name is not for free. But creativity is.
4. Organize your site navigation
Providing easy steps in navigating your site is one way to make your visitors become at ease with your site. This, in turn, will improve the flow of traffic to your website.
Low cost SEO is always evolving like any other approach in information technology. There are many methods that can very well land you on the top ten rankings of Google or on any other search engines. Some may cost a lot but there are methods that can give you the same results at a low price or you can even do on your own such as those mentioned above.
Find more related articles at Article Arsenal
http://article-information.co.cc
Feel free to use these articles as you like.
Start up Funding: Tips to Get Your Business Going
Minggu, Agustus 31, 2008 | Entrepreneur with 0 komentar »Start up funding is critical to the success of any business. While some companies can be started on a shoestring budget, most require some investment by the owners. There are several kinds of start up funding available.
The most common is the entrepreneur using their own savings to get their business going. Or using cash from their credit cards or from a home equity loan. The benefit is that the entrepreneur doesn’t have to worry about investors looking over their shoulder or disappointing friends and family who may have provided the funds. The disadvantage is that if the business fails, the entrepreneur’s home may be at risk or savings lost.
A small business loan is often used to purchase equipment, supplies, and inventory to get the company going. If the entrepreneur has a good credit history and a relationship with a bank that does business loans, the money can often be obtained with a simple application form. Unfortunately most banks require that unless the loan is personally guaranteed the business has to have been operating profitably for at least two years. Banks look at two factors: the risk in not getting the principal paid back and whether the company can generate enough funds to pay the monthly interest. Bankers are not interested in the growth potential of the company.
Venture capital is glamorous and gets lots of press. The reality is that it is difficult to obtain and very few start up businesses actually are successful in obtaining venture capital. Less than 20% of the venture capital invested is invested in early stage companies. The average venture capital funds invested per company per investment is nearly $10 million. Very few of the 600,000 businesses started in the United States and 400,000 in the United Kingdom each year qualify for venture capital. Less than 1% are appropriate for venture capital.
Angel investors or private individuals who invest in start ups, is another alternative. Angel investors usually invest in high tech companies that have the potential to quickly grow and return that investment at the end of a three to five year period with at least a ten fold return. In other words if the angel invests $100,000 in year one they expect to get $1,000,000 at the end of three years. Private investors sometimes work together in groups called Angel Networks. You can find Angel Networks in your area by talking to your local Small Business Development Center Office, local chamber of commerce, or searching through local newspapers, and of course through search engines.
Vendor financing and store credit are two more ways to find money for a start up company. Vendor financing is when the vendor you buy your supplies from gives you from 30 to 90 days to pay. Even if the vendor doesn’t offer payment terms you can ask for them and in return offer a 1% or 2% premium. You might be able to stretch out the payments for up to six months, with the vendor’s permission of course. Store credit is available for most businesses, even new ones by completing a store application. This can be helpful to buy office supplies and even computer systems.
Start up funding is available to start a business but it isn’t always easy to find.
Dubai International Financial Centre (difc)
Minggu, Agustus 31, 2008 | islamic Finance with 0 komentar »Dubai International Financial Centre is an onshore capital market, and is today one of the worlds fastest growing financial centres. An integral part of His Highness Sheikh Mohammed Bin Rashid Al Maktoum’s ‘Vision of Dubai ’, the DIFC has become a financial hub of the Middle East, comparable with those in London, New York and Hong Kong. A designated financial free zone, the DIFC has attracted a large number of leading financial brands to the region since its launch in September 2004.
Within the DIFC, there is a focus on six key areas of financial activity: Banking Services (Investment Banking, Corporate Banking and Private Banking); Insurance and Re-insurance; Asset Management and Fund Registration; Capital Markets (Equity, Debt Instruments, Derivatives and Commodity Trading; Islamic Finance and Professional Service Providers. All companies looking to operate within the DIFC must apply for a trading licence in one of the above financial sectors.
In order to attract leading financial institutions to the region, the DIFC offers a range of incentives designed to create a highly attractive trading environment for its members. These incentives include zero taxation on corporate income or profits, 100 percent foreign ownership and no restrictions on foreign exchange or capital repatriation. As well as the financial incentives, the DIFC has also provided an ultra-modern, state of the art infrastructure. Offices in the DIFC will employ the very latest technology and communications to provide a truly world class service to its residents.
The focal point of the DIFC development is The Gate, a stunning 15-storey office tower housing the executive offices of the DIFC. An iconic building, The Gate is the architectural signature building of the DIFC, and a gateway to one of the worlds leading financial centres.
The DIFC district covers a total of 110 acres of prime Dubai real estate off the main Sheikh Zayed Road. A world class development, the DIFC will be a unique integration of offices, serviced apartments, hotels, shops and restaurants.
Islamic finance places strong emphasis on the economical, ethical, moral, social, and religious dimensions, to enhance equality and fairness for the good of society as a whole, whereas the conventional financial system focuses primarily on the economic and financial aspects of transactions. As a result Islamic insurance might also be seen as an ethical insurance.
Islamic insurance is provided under a principle called Takaful. The term “Takaful” is derived from the Arabic word “Kafaala” meaning guaranteeing. Takaful means “guaranteeing each other" and refers to the concept of permissible Islamic insurance or “Halal” insurance.
Islamic insurance or Takaful is based on the principles of “Ta’awun” (mutual cooperation) and “Tabaru’a” (Donation) whereby a group of people (Takaful participants or policyholders) agree between themselves to share the risk of a potential loss to any of them by making a donation, of all or part of their contribution, which is used to compensate the loss suffered by any participant of the Takaful scheme. Unlike conventional insurance in which risk is shifted from the policyholder to the insurance company, Takaful is a structure in which risk is shared between all the policyholders.
Additionally Islamic insurance can also be seen as an ethical insurance product because of the additional levels of governance required to ensure it is Halal.
Islamic finance principles have been derived from the Holy “Qur’an” (the Holy book of the Muslims), “Hadith” (the sayings of the Holy Prophet Muhammad PBUH), “Sunnah” (the way the Holy Prophet Muhammad led His life) and centuries of scholarly interpretations of these three sources. These rules define clearly what is “Halal” (permissible) and what is “Haram” (prohibited) in a financial transaction. The salient points of these rules are:
Shariah prohibits the following:
# ‘Riba’ - interest/usury
# ‘Maysir’ or ‘Qimar’ - gambling/speculation
# ‘Gharar’ - uncertainty
# Exploitation
# Unfairness
# Undertaking Haram activities (alcohol, pork, pornography etc)
# Shariah requires:
# Risk sharing
# Reward sharing
# Fairness
# Transparency
# Sanctity of contracts
Strict adherence to these principles means that Islamic insurance products can also be a viable alternative for the growing number of ethically-motivated consumers who wish to buy an ethical insurance product.
Takaful and the Principles of Shariah-compliant Financial Services
Minggu, Agustus 31, 2008 | islamic Finance with 0 komentar »The term “Takaful” is derived from the Arabic word “Kafaala” meaning guaranteeing. Takaful means “guaranteeing each other" and refers to the concept of permissible Islamic insurance or “Halal” insurance.
Takaful is based on the principles of “Ta’awun” (mutual cooperation) and “Tabaru’a” (Donation) whereby a group of people (Takaful participants or policyholders) agree between themselves to share the risk of a potential loss to any of them by making a donation, of all or part of their contribution, which is used to compensate the loss suffered by any participant of the Takaful scheme.
Unlike conventional insurance in which risk is shifted from the policyholder to the insurance company, Takaful is a structure in which risk is shared between all the policyholders.
The term Islamic finance refers to financial and commercial activities and transactions that conform to “Shariah” (Islamic law). Whilst the terms Islamic finance, interest-free banking, Shariah finance, Shariah banking, Shariah insurance, Islamic banking, and Islamic insurance are relatively new, the underlying principles of Islamic finance date back to the times of the Holy Prophet Muhammad (PBUH). The trading practices of Muslims were based upon these principles until the days of the Ottoman Empire.
Islamic finance principles have been derived from the Holy “Qur’an” (the Holy book of the Muslims), “Hadith” (the sayings of the Holy Prophet Muhammad, PBUH), “Sunnah” (the way the Holy Prophet Muhammad led His life) and centuries of scholarly interpretations of these three sources. These rules define clearly what is “Halal” (permissible) and what is “Haram” (prohibited) in a financial transaction. The salient points of these rules are:
Shariah prohibits the following:
# 'Riba' - interest/usury
# 'Maysir' or 'Qimar' - gambling/speculation
# 'Gharar' - uncertainty
# Exploitation
# Unfairness
# Undertaking Haram activities (alcohol, pork, pornography etc)
# Shariah requires:
# Risk sharing
# Reward sharing
# Fairness
# Transparency
# Sanctity of contracts
Islamic finance places strong emphasis on the economical, ethical, moral, social, and religious dimensions, to enhance equality and fairness for the good of society as a whole, whereas the conventional financial system focuses primarily on the economic and financial aspects of transactions.
There are many Shariah compliant modes of finance which are used to develop Halal financial products. These include “Takaful” (insurance), “Musharaka” (partnership), “Mudaraba” (silent partnership), “Murabaha” (special type of sale), “Ijara” (lease), “Wakala” (agency), “Salam” (forward sale), “Istisna’a” (manufacturing or construction contract) and Qard (a loan - without any benefits).
Islamic Financial Arrangements Used in Islamic Banking
Minggu, Agustus 31, 2008 | islamic Finance with 0 komentar »ABSTRACT
Islamic finance is an old concept but a very young discipline in the academic sense. It lacks the required extent and level of theories and models needed for expansion and implementation of the framework provided by Islam. In these circumstances, unawareness and confusion exist as to the form of the Islamic financial system and instruments.
The main difference between the present economic system and the Islamic economic system is that the later is based on keeping in view certain social objectives for the benefit of human beings and society. Islam, through its various principles, guides human life and ensures free enterprise and trade. That is the reason why the conventional banker does not have to be concerned with the moral implications of the business venture for which money is lent.
TABLE OF CONTENTS
1. ABSTRACT
2. The Role of Money
3. Types of Islamic Financial Instruments
4. Risk Mitigating Features
5. Islamic Leasing
7. MUSHARIKA
8. MODARABA
9. CONCLUSIONS
Socio-economic justice is central to the Islamic way of life. Every religion has the same basic aim. In an Islamic environment, an individual not only lives for himself, but his scope of activities and responsibilities extend beyond him to the welfare and interests of society at large. The KORAN is very precise and clear on this issue. There are basically three components of an Islamic economic paradigm:
1. That as vice-regent, man should seek the bounties of the land that God has bestowed on humanity. From the wealth thus obtained, he should enjoy his own share.
2. That he should be magnanimous to others and use a part of the wealth so obtained also for the benefit of his fellow-beings.
3. That his actions should not be willfully damaging to his fellow-beings.
Human society in Islam is based upon the validity of law, of life and the validity of mankind. All these are natural corollaries of the faith. Islamic laws promote the welfare of people by safeguarding their faith, life, intellect, property and their posterity. God nurtures, nourishes, sustains, develops and leads humanity towards perfection. Even though an individual may be making a living because of his efforts, he is not the only one contributing towards that living. There are a number of divine inputs into this effort and therefore, the results of such an effort obviously cannot be construed as entirely proprietary.
Whereas the Islamic banker has a much greater responsibility. This leads us to a very fundamental concept of the Islamic financial system i.e. the relation of investors to the institution is that of partners whereas that of conventional banking is that of creditor-investor.
The Islamic financial system is based on equity whereas the conventional banking system is loan based. Islam is not against the earning of money. In fact, Islam prohibits earning of money through unfair trading practices and other activities that are socially harmful in one way or another. [1]
Those who swallow down usury cannot arise except as one whom SHAITAN (evil) has prostrated by (his) touch does rise. That is because they say, trading is only like usury; and Allah has allowed trading and forbidden usury. To whomsoever then the admonition has come from his Lord, then he desists, he shall have what has already passed, and his affair is in the hands of Allah; and whoever returns (to it) - these are the inmates of the fire; they shall abide in it [SURAH 2:275].
Not that there was any ambiguity in the Command of Allah. Far be it from Him to give any order to His Servants, which they can not comprehend. The fact is that those who had surplus money and wanted to earn profit did so either by lending it through RIBA (usury) or by investing it in trade and hypocrites were not prepared to forgo the first option. Hence, they argued that since both were means of earning profit, they were alike and the prohibition of RIBA did not stand to reason.
The practice of RIBA i.e. usury was so deep-rooted in society and continuance of the practice was so undesirable, that Allah warned the believers that if they did not desist, they should be prepared for a war against Allah and His Apostle. This warning was heeded by the Muslim UMMAH and for more than a thousand years the economies of Muslim states were free from RIBA. With the ascendancy of Western influence and its suzerainty over Muslim states, the position changed and an interest-based economy became acceptable. Efforts in Muslim countries to revert to an interest-free economy were hampered by many obstacles. [2]
The Role of Money
The traditional definition of the time value of money leads one to assume that profit maximization is the objective of investors irrespective of whether or not the earning of profit has made someone else worse off. Some economists have termed the maximization of profit as the sole objective of corporations. This view cannot be supported or defended since the profit maximization process may lead to perverse outcomes. When financial operations are removed of moralistic tone, competitive markets fail to achieve the efficient allocation of a country's resources.
In Islam money in itself is not considered, as actual capital only exists when money, along with other resources, is sunk into productive activities. Linking the use of money to productive purposes invariably brings into action the factor of labor, a process from which benefits pass on to society.
Types of Islamic Financial Instruments
Demand for monetary instruments is influenced by the variation and level in the market rate what is meant as the market rate of return. The demand for household monetary instruments is mainly for the purpose of circulation of income. Banks need these instruments for:
1. Transaction purposes;
2. Precautionary purposes, in that some unexpected payments have to be made while some expected inflows may not be forthcoming on their due date, and;
3. not only to avoid loss but also to obtain gains in the capital value of financial assets under the expectation that the market rate of return may move in a certain direction.
What differentiates a traditional financial market from others markets is that no tangible good or service is exchanged for any monetary consideration; only a "financial claim" changes hands in the form of a promissory note or a title to any future flow of income adjusted for any capital appreciation. Not all Islamic instruments are purely financial claims. Some of the instruments also represent ownership of the underlying assets together with a claim to underlying cash flows. Basically there are the following four types of Islamic financial instruments:
1. Type "A" is a financial claim of monetary value with recourse to underlying durable assets and related cash flows. This type has a predictable future income stream, is marketable and can be discounted since with the changing of hands, the instrument passes title to the goods and not to the debt. It is basically lease-based.
2. This instrument is partly backed by durable assets and its income is not predictable, but evaluated through an asset valuation process at the end of an agreed and declared duration. The underlying transactions can be a mix of IJARA, MODARABA, MUSHARAKA etc., contracts. This Type may be traded in the secondary market at its fair market price acceptable to the parties involved but not discounted.
3. Type "C" is purely a monetary claim to an expected income stream forthcoming from underlying commercial transactions. Income is evaluated through an asset-valuation process at the end of an agreed and declared period. A transaction of this type may comprise MORABAHA, ISTASNA etc., contracts which are debt claims against third parties in respect to actual commercial transactions. The Type may be traded at its face value declared at the end of each accounting period but cannot be discounted.
4. The Type "D" is purely a financial claim of monetary value but with recourse to certain precious metals such as gold, silver, platinum, etc., or commodities quoted on exchanges. The instrument entitles the holder to take delivery of the underlying asset but does not carry any attached revenue stream except that its price is pegged to the price of the underlying precious metal or commodity quoted at recognized international exchange rates. It can be traded but not discounted. [3]
Risk Mitigating Features
The phenomenon of risk plays a pervasive role in economic life. Without it, financial and capital markets would consist of the exchange of a single instrument each period, the communications industry would cease to exist in so far as this market is concerned and the profession of investment banking would be reduced to that of accounting. Risk is further segregated from uncertainty. A situation is said to involve risk if the randomness facing an economic agent can be expressed in terms of specific numerical probabilities (these probabilities may either be objectively specified, as with lottery tickets or else reflect the individual's own subjective beliefs). Situations where the agent cannot (or does not) assign actual probabilities to alternative possible occurrences are said to involve uncertainty.
While it is not always true that a riskier asset will pay a higher average rate of return, it is usually return. Risk is an opportunity in financial markets and also a problem. Risk-averse investors require additional return to be at additional risk and, in effect, in a competitive market higher return is accompanied by higher risk. An investor evaluates an asset in terms of its marginal contribution to his/her portfolio.
The fundamental principal of valuation is that the value of any financial asset is the present value of the cash expected. The process requires two steps:
1. Estimating the cash flow, and;
2. Determining the appropriate interest rate that should be used to calculate the present value
The following are the SHARI'AH compliant risk mitigating features:
1. By prior arrangements in the instrument, the investing company, through its banker, would have a priori right in profit sharing up to an agreed upon ratio.
2. The profit will be paid on account on a monthly basis to the investing company as provided in the projected accounts.
3. The final accounting and settlement is accomplished at the end of the term of the instrument when the profit and loss accounts are finalized.
4. In order to mitigate the risk and as per the terms of the instrument, a TAKAFUL fund is established for the term of the instrument.
5. In this TAKAFUL fund where the invested company earmarks a part of their reserves for the TAKAFUL fund.
6. The investing company will contribute 1% of the invested amount.
7. This 1% contribution is made through an advance by the invested company on account of future profits.
8. In case of any loss during the tenancy of the instrument, it will be adjusted against the TAKAFUL fund.
9. The balance will be distributed between investor and at the end of the term of instrument.
10. Through a valuation, value of the investment would be established for the purpose of exercising the put option.
11. The investing company shall have the option to exercise its put option at the value price and the company shall buy this instrument. [4]
Islamic Leasing
But before describing leasing, as aforesaid, let me very briefly touch upon two of the basic or fundamental principles of Islamic finance in order to develop a premise for meaningful discussions on leasing.
1. It has to be asset-based financing:
The first fundamental principle of SHARI'AH is that as opposed to conventional monetary dealing, profit is generated when something having intrinsic utility is sold or offered for use. Money has no intrinsic value. As such dealing in money (same currency) cannot generate profit but a RIBA unless converted into real assets to deal with.
2. There has to be an element of risk:
The second basic element of SHARI'AH is that one cannot claim a profit or fee for a property/transaction, the risk of which was never borne by him.
Based on the above fundamental principles, the most ideal mode or instrument of financing in SHARI'AH are MUSHARAKA and MUDARABA followed by SALAM and ISTINSA.
MORABAHA and leasing are not originally modes of finance. However, to meet certain specific needs where ideal modes like MUSHARAKA or MUDARABA are not workable for whatever reasons, they have been reshaped and allowed in SHARI'AH subject to certain conditions.
1. Leasing described for leasing, IJARAH is an Arabic term with origins in Islamic FIQH, meaning to give something to rent. There are two types of IJAREH. One relates to employing or hiring the services of a person for wages whereas the second type relates to the hiring of any asset or property in order to reap its benefits without the transfer of ownership, or what is called in English "USUFRUKT". The price or consideration of this is the rent.
It is the second type of IJAREH which is the subject matter of the discussion here because it is generally used as a form of investment and also as a means of finance.
As described earlier, in the light of the two basic cornerstones of SHARIA'H, leasing is a contract whereby usufruct rights to an asset are transferred by the owner, known as the lessor, to another person, known as the lessee, at an agreed-upon price called the rent, and for an agreed-upon period of time called the term of lease.
2. Lease as a mode of financing Strictly speaking leasing is not a means of finance as originally envisaged. It is simply a transaction much as a sale/purchase. As described above, the leasing transaction simply denotes the transfer of the usufruct of a property from one person to another for an agreed-upon price called rent without transferring the corpus i.e. ownership of that asset. Accordingly, the rules of "leasing" closely resemble the rules governing "sale" because in both cases something is transferred to second person for valuable consideration.
Leasing differs from sale only in-so-much-as not transferring the corpus or ownership of the property which remains with the transferor. As such in SHARIA'H, a lease transaction is governed by a separate set of rules, which we shall outline in the following paragraphs.
Although leasing, as originally conceived, is not a means of finance, the financial institutions and the corporate world have adopted it as such. Due to several factors (including tax concessions, etc.), instead of providing an interest-bearing loan, certain financial institutions in the West started to provide requisite equipment to their customers. To arrive at the rent, the total cost of the asset is calculated plus interest or mark-up to be recovered during the period of lease on a monthly or quarterly basis. This type of lease in the West is known as a finance lease, to be distinguished from an operating lease, wherein various basic features of the leasing transaction are ignored which is tantamount to RIBA.
Knowing that leasing is lawfully allowed under SHARIA'H, since it meets one of the basic criteria of asset-based finance, a number of Islamic financial institutions have adopted leasing on this model as carried out by conventional financial institutions without making the necessary modifications that really conform to the rules under SHARIA'H, particularly in regards to assuming the risk of ownership in the leased asset. Great care needs to be exercised to ensure various SHARIA'H requirements, as rendered below, based on the basic two principles of:
1. Asset based finance, and;
2. Assuming a risk element connected to the ownership of the asset.
3. Basic Rules of Leasing
The description or definition given above, under part A, contains the following essential ingredients for outlining the basic rules under SHARIA'H:
1. That it is a contractual obligation.
2. That there has to be a valuable use of the asset and transferability of that usufruct.
3. That the ownership of the asset is retained by the transferor or lessor throughout the lease period. Consumable articles cannot be leased.
4. That the risk and liabilities of ownership lie with the lessor. The leased asset shall remain the risk of the lessor throughout the lease period. Any loss or harm caused by factors beyond the control of the lessee shall be borne by the lessor. However, the lessee is liable to compensate the lessor for any harm to the leased asset caused by any misuse or negligence on the part of the lessee.
5. That the risk and liabilities associated with the use of the asset shall be borne by the lessee. For instance, taxes and other government levies, utilities, etc. However, the contract must specify these items for clarity's sake.
6. That the term of the lease, period of the lease, its renewal or early termination must be stipulated.
7. Purpose of use. The lessee cannot use the leased assets other than for the purpose specified in the contract or agreed to by the lessor expressly.
8. Commencement of lease. The lease commences from the date of delivery of the asset to the lessee and not from the day of payment or lease agreement, with reference to the commencement of rentals.
9. Determination of rental. The rent for the entire period of the lease must be determined at the time of the contract. Different rates of rent for different phases during the lease period are permissible. This point will be elaborated in the following discussion of the issues.
4. Issues
While operating a leasing business, a number of practical issues have cropped up which warrant discussion and interpretation under SHARIA'H. An exhaustive and conclusive list of such issues is impossible to make. However, certain important and salient issues need to be taken up in these discussions as follows:
1. Joint ownership (Lessors)/Joint Lessees - (permissible)
2. Insurance - Islamic TAKAFUL - (by the owner)
3. Renewal of or variation in the lease period - (permissible if mutually agreed-upon)
4. Future date. Agreement to commence lease on some future date is allowed. However, the rent has to commence from the date of delivery. If the lessee has paid the price and delivery of the asset is delayed by the supplier, then no rent is liable to be paid for the period of delay. It must be noted that future or forward sale in sale/purchase transaction is not permissible in SHARIA'H. This is another major point after ownership transfer which differentiates leasing from a sale/purchase transaction under SHARIA'H.
5. Acquisition of an asset by the lessee. For various reasons, the asset subject to lease may be acquired by the lessee and payment may be disbursed? Through him by the lessor. This is permissible under SHARIA'H on the principles of agent and principal. Here there are two relationships separate from and independent of one and other. The first relationship is that before becoming a lessee, an individual acts as an agent for and behalf of the lessor to acquire the asset. This is an independent arrangement. Once the asset has been acquired with all the risk and reward of ownership to the lessor, then a second relationship is created i.e. the lessor and the lessee under the lease agreement. That cost of acquisition shall be borne by the lessor being owner and not by the lessee.
6. Rentals.
1. Advance rentals are admissible subject to the condition of adjustment against the actual rental when due upon commencement of the lease as discussed before.
2. Unilateral increase by the lessor is not permissible even if stipulated in the contract.
3. Bench marks. The fixing of any bench mark for determining the amount of rent, as with an inflation index etc., is permissible provided that the lease agreement clearly stipulates the same e.g. if the inflation rate as declared by an authoritative body like the State Bank etc. is said to be 10% per annum, then the rent can be increased every year by that percentage.
7. Penalty for late payment of rentals. Penalty or compensation for late payment is not permissible. Rentals once due become a debt obligation or monetary asset which cannot generate profit under SHARIA'H. This situation has been exploited by unscrupulous lessees. In such circumstances, contemporary scholars have provided a solution whereby a penalty can be charged to the lessee for delayed payment though the amount recovered is only to be used for charitable purposes by the lessor. In other words, the late payment charges cannot be taken as income by the lessor. A suitable clause, therefore, is to be incorporated into the lease agreement to avoid any misunderstanding in this regard.
8. Premature termination of lease. Premature termination of lease is allowed provided that the lessee has violated or contravened the terms of the lease or it is by mutual consent of the lessee and the lessor. Any unilateral or unconditional termination of the lease either by the lessor or the lessee without prior notification is contrary to the principles of justice and equity, hence not allowed under SHARIA'H.
9. Repossession of an asset. In the event of early termination, or upon maturity of the term of lease, assets have to return to the lessor unless he voluntarily relinquishes his rights or makes a gift of the leased assets to the lessee. However, rent would be payable only up to the date of termination and not beyond. Entitlement or the right of the lessor to claim rent from any period after termination, even if expressly stipulated in the contract, is not valid under SHARIA'H.
10. Residual value. It is accepted under SHARIA'H that ownership of the asset belongs to the lessor and, therefore, assets should revert back to him upon expiry of the lease. Any stipulation to the contrary in the contract that the lessor can sell or transfer the asset to the lessee upon the expiry of the term of the lease at a pre-determined price called residual value is not considered valid from the point of view of SHARIA'H However, this point is currently a subject matter of debate among contemporary scholars. They are of the view that if a lessor unilaterally undertakes or promises to transfer the ownership to the lessee as a gift or at a token price separate from the lease agreement, then this can be considered validly binding on the lessor at the option of the lessee.
11. What is important is that under SHARIA'H the leasing and sale/purchase transactions are two separate things and should not be mixed up in one contract, as both are independent and governed by separate rules. Nothing, however, in SHARIA'H stops the lessor from giving away the ownership of his assets at his own discretion or good will toward the lessee at any mutually agreed-upon price or as a gift upon the expiry of the leasing contract.
12. Sale and lease back. This is allowed, but only as two separate transactions. That in the first place there is a sale of assets to be purchased by the lessor. This is governed by SHARIA'H rules of sale/purchase at a fair market value. Once the ownership title is validly passed on to the lessee, a lease transaction can then be executed separately through a lease agreement.
13. Sub-lease. Sub-lease by the lessee is permissible under SHARIA'H subject to the consent of the lessor and can be expressly outlined in the lease agreement. In SHARIA'H, however, there are divergent views if the rent arising from the sub-lease is higher than the rent payable on the original lease. Some scholars allow the differential to be retained by the lessee while others feel that the surplus received from the sub-lease should be passed on to the owner i.e. main lessor.
14. Assigning of the lease. Also permissible under SHARIA'H, the lessor can sell the leased assets to a third party along with his rights and obligations. The relationship between lessor and lessee in this case will be determined between the new owner and the lessee. However, the lessor cannot assign the lease without transferring the ownership for monetary consideration. Here the basic SHARIA'H cornerstone of asset-back transaction is not there. Rent receivables are debt obligation which cannot therefore be transacted for a monetary price. Assignment of lease rentals without monetary consideration is, however, not prohibited in SHARIA'H.
15. Securing of the lease. Leased assets can be secured along the same principles governing the assignment i.e. ownership of assets along with the rent. Rent alone without ownership of the assets cannot be secured for the reason of being a debt obligation as discussed before. Securing a lease can be made wholly or partly to one party or to a number of persons. Documentation has to be carefully prepared to ensure the securing instrument represents assets and not the debt or monetary obligation alone. [5]
Some Difficulties
Major hurdles faced by Islamic finance houses are the absence of a necessary legal framework and the lack of adequate infrastructure in the banking and investment fields. [6]
The modern banking system is based on the concept that money should be treated like any other factor of production and must earn some return over a period of time. It is argued that the establishment of large-scale enterprises, and hence material progress, is not possible unless there is an agency that can mobilize financial resources from the public by paying them some interest, while lending these resources to entrepreneurs. By charging these entrepreneurs a higher interest, these agencies were able to utilize the difference (called a spread) to meet their expenses and to make some profit for the owners of the agency (i.e. share-holders). Banks were established to fulfill this need and from the beginning were only authorized to perform this function. They were legally prohibited from entering into trade or industry. When the Government of IRAN decided to introduce an interest-free banking system, this prohibition was removed. After a lot of in-house the banks were told that they were allowed to deal in only 1 to 12 means of financing (only two were classified as "Financing by Lending").
These two permitted lending without interest by charging the actual expense incurred by the banks to meet their cost of operation and QARDE AL'HASANA. All the rest were either trade-related or investment-type models. These included the purchase of goods by banks and their sale to clients at an appropriate mark-up price on a deferred payment basis, in case of default there being no further mark-up. This sale of goods on mark-up is known as MURABIHA. Other types of financing were hire-purchase, leasing, MUSHARIKA or profit- and-loss-sharing, equity participation and purchase of shares, etc.
Since MURABIHA was the type nearest to lending and since it did not require any expertise in buying and selling commodities, bankers limited most of their financing to this type. In order to eliminate the risk of prospective buyers refusing to accept goods purchased by the banks by reason of not being strictly in accordance with the specifications, banks were allowed to appoint the prospective buyer as their agent for the purchase of the goods and later for the sale of the goods to the buyer's firm. Furthermore, to give as much leeway to the banks, as safeguards of public money, as possible, the ULAMA did not fix a waiting period between the two stages of buying and selling.
The banks did not assume the role of trader and MORABIHA degenerated into lending on mark-up. The banks rarely hired persons who knew even the basics of trading, nor did they train their existing staff to learn the art. They did not even bother to find out whether their agents had actually purchased the goods or not. The inability or reluctance of banks and financial institutions to change over their operations from lending to trading has been a serious impediment to the Islamisation of the economy.
The blame does not entirely fall on the bankers. Depositors have become so accustomed to their money remaining safe and yet earning profit that if a bank had really ventured to trade and incurred a slight loss, then the depositors would have immediately demanded their money back causing the bank to go bankrupt. In the existing state of morality this was more likely to happen. It actually did happen to a few investment companies that had started with good intention, but could not go on giving away handsome profits to their depositors.
A lack of seriousness and dedication in those responsible for the implementation was also another great impediment to the achievement the goal of an interest-free economy. Many of these individuals thought that in the present world, there was no alternative to interest, yet something had to be done because of demands from the government. Some, who were more influenced by Western education and culture, thought that interest banking was not prohibited by Islam. Yet others thought that the efforts being made were only superficial and in reality the new system was no different from the existing system.
One weakness in the implementation of the proposals to eliminate interest from the system was that people were not sufficiently motivated to sacrifice a part of their financial interests for the sake of carrying out the commands of Allah (SWT), and the Prophet (SAW). Anyone attempting to change a well-established practice must be prepared to make some sacrifice for this, as arguably no noble cause has been achieved without any sacrifice. The prevailing level of public morality within the existing legal and taxation system of the state made it an up-hill struggle to rid the banking system of interest. And it remains so. Beyond this, there are many avenues of making profit that would have to be forgone and many types of modern banking services which also could not be provided by a bank working strictly on Islamic principles. For example, they could not keep their surplus cash in fixed or saving deposits. In spite of these difficulties, those who were engaged in the task of Islamisation took it upon themselves to portray as successful the reforms, while those who pointed out the difficulties were labeled as either a cynic or an opponent of the new system. Anyone who uttered a word of caution was regarded as someone who did not want the experiment of Islamisation to succeed. As a matter of fact, reward in the Hereafter (AAKHIRAT) should have been the main purpose of Islamisation. It might not have attracted many people, but the foundation would have been firm.
One great obstacle in the realisation of the goal of an interest-free economy has been absence of a proper environment. Unfortunately nothing has been done to produce an ideal or a near ideal Islamic environment by government or public leaders. The most important pre-requisite for the enforcement of SHARIA'H is A'DL [translation!!!!!!]. Establishment of the rule of law and ensuring justice to aggrieved persons should be the first task of an Islamic state, yet nothing have been done to achieve this end.
One very important requirement of an ideal environment is an inflation-free economy. Inflation erodes the real value of money, meaning that when a person gives a sum of money on loan and receives the same amount back after one year, he has made a net loss. A major source of inflation is deficit financing. The printing of notes to meet budgetary deficit is in fact an injustice to the public, since the real value of their money is consequently eroded. In this respect too, the government's performance is very discouraging. Government borrowings at high interest rates and the quantum of the government's domestic and foreign debts has reached a level which cannot be sustained. There has also been no effort to change the taxation structure so as to bring it to conform to SHARIA'H. [7]
MUSHARIKA
MUSHARIKA represents the most desirable form of Islamic financing arrangements. Yet, in terms of its ability to be an effective and efficient instrument for replacing interest-based transactions, it poses formidable problems.
The salient features of the MUSHARIKA agreement, as practiced by the commercial banks, were as follows:
1. It was a short-term financing arrangement specific only to the parties to the contract.
2. Investment by the banks was made in the form of the sanctioning of a funding limit to the client and the degree of employment of funds was determined on the basis of daily product of outstanding balances due to the bank.
3. All participative funds, including equity, reserves and other non-debt capital was included in the definition of capital qualifying for profits.
4. Profit sharing ratio was determined through negotiations within the boundaries specified by the SBP.
5. Profits for the purpose of sharing were to be determined after apportioning a share of net-income as a management fee to the firm.
6. Provisional profits, based on projected profits, were to be paid to the bank on quarterly basis, subject to a final adjustment on the basis of actual profits or losses.
7. Shortfalls or excess profits were to be settled through the creation of a [participation] reserve fund, which would attempt to smooth out the payments to the bank.
8. Losses, if any, were to be shared in strict proportion to the bank's investment in the total capital of the firm.
9. Against the apportioned loss of the bank, ordinary shares were to be issued, which qualified for recon version in MUSHARIKA investment under the original terms of the agreement in case profits accrued in future.
10. Standard securities in the form of pledging and hypothecation stocks or the mortgaging of properties were required against MUSHARIKA financing.
Some of these features of the instrument attracted criticism. For example, the profit sharing arrangement did not strictly conform to the requirements of SHARIA'H particularly in the treatment of losses and the payment of provisional profits or their adjustment through the participation reserve. Secondly, despite being a sharing arrangement, the actual agreement was cast within the framework of a creditor-debtor relationship, and was also protected as such in law. Three, MUSHARIKA also demanded securities which were akin to the relationship between a creditor and debtor. Finally, in the absence of a legal framework regulating the operation of MUSHARIKA, there was no standardization of the agreement, and the terms and conditions of various agreements varied considerably.
MODARABA
MODARABA represents another of the more desirable forms of Islamic financing arrangements.
The salient features of MODARABA companies and their operations are as follows:
1. Only registered companies or those established under specific laws are eligible to register as MODARABA companies.
2. MODARABA can either be specific purpose or multi-purpose and can either be for a fixed term or in perpetuity.
3. On fulfillment of certain conditions, and with the prior approval of the Registrar, MODARABA companies may float MODARABA on the stock exchange, and their certificates of issue will be tradable securities.
4. Each MODARABA will be a separate business and its operations must conform to those approved under the injunctions of SHARIA'H.
5. A Religious Board, to be periodically constituted under the ordinance, will be empowered to declare whether the operations of MODARABA were in conformity with the provisions of SHARIA'H or not.
6. Many disclosure requirements, similar to those applicable to listed companies, are applicable to MODARABAS, including statutory audit, annual meetings and investments and loans to and from the directors of the MODARABA Company.
Evidently, the entire scheme was an elegant formulation of the simple relationship required under a MODARABA contract between labor (DARIB) and capital (RABBULMA'L). The management company was to be remunerated through a fixed management fee paid out of the net income of the MODARABA and the remainder was to go to MODARABA certificate holders, with adequate provisions for retained earnings to ensure future growth.
CONCLUSIONS
To outline the broad features of a strategy which holds the promise of successfully implementing an Islamic system of finance are as follows:
1. The process has to be guided by basic legislative efforts covering all the essential elements of the proposed programmed.
2. The legislation would define RIBA and prohibit transactions connected with RIBA.
3. The application of the law would be unqualified and without exception, thus the entire financial sector, covering banking government finance and foreign transactions would be covered in its ambit.
4. Given the unqualified and non-exceptional nature of the proposed law, even existing relations will have to be converted into permissible forms, for which a suitable time frame, within a phasing-in period, will be allowed.
5. The law should also provide for the Constitution of a SHARIA'H Board which would assist the SBP to formulate permissible means of financing. Such means, specified with the prior approval of the Board, will only be illustrative and no restrictions will be placed on banks and financial institutions to design means of financing which are free of RIBA.
6. A major portion of the law will have to be devoted to a plan of restructuring the fiscal policy which comprises a scheme for the privatization of public sector assets and the use of its proceeds for the settlement of the outstanding stock of public debt.
The proposed strategy is based on the clear recognition of the scope implied by the prohibition of RIBA. This is critical, for otherwise the solution will continue to elude us.
If you’re Muslim and are concerned about financial products that comply
with Sharia Law, there are more and more options available to you
today. The first Islamic bank in the UK, the Islamic Bank of Britain,
opened its headquarters in Birmingham in 2004, offering a range of
products and services such as pensions, mortgages and loans.
The main requirement for financial products and services under Sharia
Law is that they neither charge interest nor pay it out, as making
money from money is considered usury, and that they do not invest in
companies that are deemed unethical, such as those connected with
alcohol, tobacco, pornography or gambling.
What often happens when providing loans is that the bank will purchase
an item for the customer at a set price and rent it or sell it to them,
with repayments made in instalments. The bank makes its money by
levying a charge on the customer’s payments.
With investments, Islamic finance works on the basis of sharing the
risk as well as the reward. Both the customer and the bank agree on
terms for sharing the risk of any investment and split any profits
equally between them.
The four main modes of Islamic banking are known as murabaha, where a
purchase is made by the bank and re-sold to the customer without any
interest payments; musharaka, a partnership in which the rewards and
risks – i.e. the profits and losses – are shared by both the bank and
the customer in an investment; mudaraba, where someone places their
investment in the hands of an expert who invests for them and shares
the profit but doesn’t bear the risk of any losses; and ijarah, a
rental agreement made in order for the customer to obtain goods, in
which rental payments are made over a specified period and the bank
reclaims the goods at the end of it.
Many of the high street banks offer Islamic products, and there are
some Middle Eastern banks with branches in the UK that provide
financial products and services suitable for muslims.
Trust funds
The government introduced child trust funds in 2005 to help new parents
to start saving for their child’s future. Upon the birth of a child,
they are given £250 in vouchers to invest on their behalf, and an
additional £250 on the child’s seventh birthday. Additional
contributions of up to £1,200 can be made annually, and the money
can be invested in savings accounts or in stocks and shares, or a
combination of both (a stakeholder account).
A Sharia-compliant child trust fund is also available for the children
of Muslim families, and is provided by the Children’s Mutual. It’s a
stakeholder account, which invests in the stock market until the child
turns 13 and then transfers the funds into a savings account or lower
risk investments such as government bonds. This aims to reduce the
impact of any stock market slumps in the run-up to their 18th birthday.
All investments are made in funds that don’t compromise Islamic
principles, and no interest is paid on the savings.
Mortgages
As mortgages are interest-charging loans, they are not considered
acceptable to the Islamic faith. However, as most people can’t afford
to pay cash to buy a property outright, there is a demand for Sharia-compliant mortgages
among the Muslim community. Many high street banks now offer such
products, as does the Islamic Bank of Britain. An Islamic mortgage
normally works by means of ijara, a leasing agreement in which the bank
purchases the property on behalf of the customer and charges rent to
them (including a handling fee) until the purchase price is repaid, at
which point the customer owns the property outright. As with other
mortgages, the bank retains the rights to the property until this point.
Bank accounts
To comply with the Islamic faith, bank accounts should neither charge
nor pay interest. This normally means that there will be no overdraft
or credit card facilities on current accounts, and that savings
accounts invest money to make a profit rather than receive interest on
it.
Pension schemes
A few financial organisations now offer Islamic pension schemes,
allowing Muslims to invest for their retirement without having to
compromise their beliefs. Such schemes invest only in funds considered
to be ethical under Sharia Law – i.e. no investment in companies
involved in alcohol, tobacco, betting or pornography, or any companies
such as banks that profit from charging interest. If any dividends
arise as a result of business involvement in any of these areas, the
money is ‘purified’ by giving it to charity rather than awarding it to
those investing in the scheme.
Squamish Kite-surfing attracts famous entrepreneur Richard Branson
Minggu, Agustus 31, 2008 | succes story with 0 komentar »Richard Branson , world renowned adventurer, extreme sports enthusiast and entrepreneur, was incredibly impressed with his first visit to Squamish BC, The Outdoor Recreation Capital of Canada. “This place is amazing! I’m definitely coming back some time to do more kite surfing!†exclaimed Branson after a 40 minute kite surfing ride in strong winds off the Squamish Spit against the backdrop of snow-capped mountains and the monolithic rock climbing playground of the Stawamus Chief.
Of course, this was not only a chance for Richard Branson to get out and have some fun. It was also a media event, with a helicopter circling above and camera crews on shore,. All this provided great photo opportunities for two Virgin Mobile promotional announcements, including the announcement that Virgin Canada has pledged $100,000 to sponsor a team of extreme female athletes. Virgin Canada Chair Andrew Black said the ‘Women’s Extreme Team’ was a good fit and a good opportunity for Virgin, as extreme sports reflected their brand. Female athletes were chosen because much of the extreme sports sponsorship and attention has previously focused on males.
What led Branson and Virgin to choose Squamish BC as the location for this event? It seems there were a number of factors. First, Western Canada was left out of the Virgin Mobile announcements with Branson when the company launched in March. Second, Branson has recently become a very avid kite surfer. He was eager to promote the sport in Canada, where, according to Branson, the levels of participation are below what they are in other parts of the world, and below what they should be, given it is such a great sport, and one “can get into it for a relatively low costâ€. Voila â€" a visit to Western Canada’s premier kite surfing destination was in order.
Members of the Squamish Windsurfing and Kite Surfing Society rated Branson as “Pretty Goodâ€. Given that it is always hard in a new location until a kite surfer gets the feel of the local wind and the waves, Branson put on a great show on his first trip to Squamish. One member noted that it was impressive that he used a 14 foot rig as opposed to a 12 footer, given the strong winds.
What makes the Squamish Spit such an excellent windsurfing location? The best summary I found was on the www.flexfoil.com site, summed up in an article by Cliff Umpleby, a Flexi team rider:
"If you’re not familiar with the kite scene in Canada or the infamous Spit at Squamish I’ll fill you in…With the Stawamus Chief, the second largest granite Monolith on earth as a background, the constant thermal winds of Howe Sound lead to epic conditions with summer seeing usually 6 days a week on the water. The basic rule here is, if it’s sunny, it's windy. Warm air inland rising sucks the cool sea air up the valley."
The Squamish Spit is located at very end of Howe Sound on a narrow piece of land that divides the Squamish River from the rest of the Squamish Estuary. While usually best left as a destination for intermediate to advanced riders, it’s perfect for learning if the tide is low. The Squamish Windsport Society charges a fee for access, which includes a Jet Ski on hand in case you go down and can't make it back.
Beyond Kite Surfing, Squamish offers an incredibly wide variety of outdoor recreation opportunities. Over 1000 routes of all varieties on clean granite makes Squamish the premier rock climbing destination in Canada. Add to that an extensive trail network for hiking, running, and mountain biking, and a few class three and four rapids for the kayaks and rafting boats, and one gets a bit of an insight as to why Squamish attracts thousands of adventure sports enthusiasts like Richard Branson all summer. Of course, there are also golf courses, great fishing opportunities and moderate day hikes for the less adventurous.
Richard Branson famously started his entrepreneurial career selling mail order music, and went on to create a business empire which includes an airline, music stores, Virgin mobile of course, and a fairly good cola that is unfortunately not available in Canada.
As the co-founder and chairman of the mammoth Microsoft Corporation, Bill Gates is the moving force behind a company that has been regarded as "The Most Innovative Company Operating in the U.S." (1993, Forbes magazines). Microsoft introduced several revolutionary technological advancements in the computer industry that made the company the first truly dominant player among home computer operating systems. Microsoft also created the most widely used operating system in the world, Microsoft Windows.
Gates is widely regarded as the brains behind the Microsoft Corporation, primarily responsible for product strategy from the time the company was founded in 1975 until 2006. Among his key contributions are extensively broadening the company's product lines and vigorously defending Microsoft's dominant position in its key areas of operation. And while some of his decisions have led to antitrust litigation over Microsoft's business practices, his reputation as one of the most popular and respected entrepreneurs of the personal computer revolution remains intact. His fame actually surpasses the realm of computers and business and extends into mainstream society. For instance, in a 2006 list compiled by New Statesman magazine, Gates was voted eighth in the "Heroes of Our Time" category.
In June 2006, Gates announced that he will be handing the reins of Microsoft's day-to-day operations to someone else by July 2008 to concentrate on the philanthropic work of the Bill and Melinda Gates Foundation, although he will continue to serve as the company's chairman and as an advisor on special projects. Plans are already afoot to transfer Gates' role as Chief Software Architect of Microsoft to Ray Ozzie, the former head honcho of the Groove company which Microsoft purchased in 2005.
Gates has donated several millions of dollars to various charitable groups and scientific research studies. By some estimates, Gates has contributed over half his fortune to charity. Even if such were the case, he can easily afford it. Recently, the prestigious Forbes magazine named Gates as the world's richest person for the 12th straight year, with a 2006 net worth of $50 billion. Incidentally, he actually became the world's first "centibillionaire" in 1999 when his net worth surpassed the 100 billion mark briefly.
Bill Gates has created the world's largest company, he is the world's richest man and he has become the biggest charitable giver in history.
He may be a college drop-out and "computer geek" but rivals have often underestimated his abilities in the cut throat world of business.
Despite the wealth and ruthless domination of the global computer industry, Gates maintains it is the programming itself which is his abiding passion.
He stood down as chief executive of Microsoft in 2000, to focus on software development and the new challenges of the mobile internet age.
The one-time high school computer enthusiast - whose worth
passed the $100bn mark in 1999 - said he wanted to immerse
himself again in the work he loves most.
Early fascination
Gates has come to be known for his aggressive business
tactics and confrontational style of management.
He, and his company, have attracted a vast army of critics and enemies in recent years as their domination of the IT world has grown.
He was born on 28 October, 1955, growing up with two sisters in Seattle. Their father, William H. Gates II, is a Seattle attorney, and their late mother, Mary Gates, was a schoolteacher.
Gates began computing as a 13-year-old at the city's Lakeside school.
By the age of 17, he had sold his first program - a timetabling system for the school, earning him $4,200.
It was at Lakeside that he met fellow student Paul Allen, who shared his fascination with computers.
During Gates' stint at Harvard, the two teamed up to write the first computer language program written for a personal computer.
The PC's maker, MITS, liked their work and the two friends established Microsoft in 1975, so-called because it provided microcomputer software.
Self-made billionaire
A year later, Gates dropped out of Harvard, once it became clear that the possibilities for Microsoft were bright.
The big break came in 1980 when an agreement was signed to provide the operating system that became known as MS-DOS, for IBM's new personal computer.
In a contractual masterstroke, Microsoft was allowed to license the operating system to other manufacturers, spawning an industry of "IBM-compatible" personal computers which depended on Microsoft's operating system.
That fuelled further growth, prompting the company to float in 1986, raising $61m.
Now a multi-millionaire, Allen had already stepped back from the frontline. But Gates continued to play the key role in the company's growth, with his vision for networked computers proving central to Microsoft's success.
However, his judgment has not always appeared flawless.
While sales and profits rocketed in the early 1990s, he was seen to have misjudged on a grand scale the possibilities and growth of the internet.
Outside of Microsoft he also has interests in biotech companies, sitting on the board of the Icos Corporation and has a stake in Darwin Molecular, a subsidiary of British-based Chiroscience.
Family man
He founded Corbis Corporation, which is developing a digital archive of art and photography from public and private collections around the globe.
His books, The Road Ahead and Business @ the Speed of Thought have both hit the best seller lists.
Gates married Melinda on New Year's Day 1994.Together they have three children - Jennifer Katharine, born in 1996, Rory John, born in 1999, and Phoebe Adele, born in 2002
He met his wife in 1987 at a Microsoft press event in Manhattan. She was working for the company and later became one of the executives in charge of interactive content.
Other interests listed on his official website are reading and playing golf and bridge.
Gates and Melinda have been giving increasing amounts of money to charity, with his father running a foundation.
It has been endowed with billions to support initiatives in the areas of global health and education.
It is the world's second richest philanthropic organization, and within shouting distance of the world number one, The Welcome Trust in the UK.
Bill Gates
Business Personality
Name at birth: William Gates III
Bill Gates is the head of the software company Microsoft and is one of the world's wealthiest men. Gates and Paul Allen founded Microsoft in the 1970s, though Allen left the company in 1983. Gates oversaw the invention and marketing of the MS-DOS operating system, the Windows operating interface, the Internet Explorer browser, and a multitude of other popular computer products. Along the way he gained a reputation for fierce competitiveness and aggressive business savvy. During the 1990s rising Microsoft stock prices made Gates the world's wealthiest man; his wealth has at times exceeded $75 billion, making Gates a popular symbol of the ascendant computer geek of the late 20th century. In June of 2006, Gates announced that he would step down from day-to-day involvement in Microsoft by July of 2008. He said he would then remain chairman of the Microsoft board while focusing on his charitable foundation, the Bill and Melinda Gates Foundation.
Extra credit: Gates married Melinda French, a Microsoft employee, on 1 January 1994. The couple have three children: daughters Jennifer Katharine (b. 1996) and Phoebe Adele (b. 2002) and son Rory John (b. 1999)... Gates's personal chartiable initiative, the Bill and Melinda Gates Foundation, has focused on global health issues, especially on preventing malaria and AIDS in poor countries; in 2005, ABC News reported that he had given away over six billion dollars in the previous five years... For their philanthropic activities, Time magazine named Bill and Melinda Gates (along with rock star and activist Bono) its Persons of the Year for 2005.
Bill Gates, the co-founder and chairman of the Microsoft Corporation, has certainly reached legend status and not only because he is considered as the world's richest man. As the moving force behind a company that is considered "The Most Innovative Company Operating in the U.S." (1993, Forbes magazines), Gates is certainly in a league of his own. With Gates at the helm, Microsoft launched a number of revolutionary technological advancements that have changed the face of the computer industry and the way people around the world use computers.
History has acknowledged Microsoft's great contributions and has judged Mircrosoft to be the first truly dominant player in home computer operating systems. Even today, Microsoft's influence is felt around the world through the broad usage of Microsoft Windows, currently the most widely used operating system in the world.
Gates first made his mark as is widely regarded as the prime mover and innovator behind the Microsoft Corporation from the time it was founded in 1975 until 2006. As the man responsible for product strategy, Gates greatly expanded Microsoft's product lines and established as well as defended the leadership position in many of its key areas of operation. Gates has not been perfect as some of his decisions have led to antitrust litigation over Microsoft's business practices. But his reputation as one of the most popular and respected entrepreneurs of the personal computer revolution is unquestioned. Gates is actually one of those men who is larger than his area of expertise. To illustrate this point, New Statesman magazine voted Gates as number eight among the "Heroes of Our Time."
Of late, Gates has been delegating many of his key functions in Microsoft. He announced last June that he would be naming someone else as the head of operations of Microsoft by July 2008 although he did say that he will still sit as the company's chairman and as an advisor on special projects. Sources say that the leading candidate to succeed Gates as operations hear is Ray Ozzie, former president of the Groove company, which Microsoft purchased in 2005.
His latest focus has been in the area of philanthropy through the Bill and Melinda Gates Foundation. Some sources in the press estimate that Gates has probably contributed over half his fortune to charity.
Spiritual Research on the Spiritual Life of Bill Gates
Minggu, Agustus 31, 2008 | succes story with 0 komentar »In an age where the super rich invest their wealth in various interests such as football teams, vintage aircrafts etc., Bill Gates stands apart. He has not only pledged a large percentage of his wealth to charity, but has also stated that after July 2008, he will be devoting all his time to charity work.
There are very few people who are able to walk away from their wealth and also devote their time to help society. It is for this reason the Spiritual Science Research Foundation proceeded to find out through spiritual research, the contributing factors behind this noble act and to find out the spiritual factors that contributed to Bill Gates taking this life path.
Information about some relevant past lives of Bill Gates
* Bill Gates has had a rich spiritual background in his past lives. He is a seeker of God following the Spiritual 'Path of Action' (Karmayoga) which is inherently about practicing Spirituality according to the principle ‘As one sows, so shall one reap’. The knowledge received also revealed that his faith and his efforts undertaken on this path to God, has made him a philosopher with thought-leadership on the Path of Action.
* Through spiritual practice he has acquired a place in the subtle highly evolved plane of existence, the Mahaloka (a region which is more subtle and spiritually progressive than Heaven).
* He has done spiritual practice for 20,000 years in the subtle plane of existence called Heaven and for 3000 years in the subtle plane of existence called Mahaloka. This amounts to a total of over 180 million years of effective spiritual practice in Earth years before being born as Bill Gates in this lifetime.
What is the purpose of Bill Gates’ birth on Earth?
* Bill Gates due to his ample spiritual practice in previous births has already transcended (gone beyond) the attachment to happiness one enjoys in Heaven and has attained Mahaloka, and has taken birth on Earth to ascend (progress) from actual actions of sacrifice to complete renunciation.
* By virtue of his merits and spiritual level from previous lives, Bill Gates is destined to lead a life of fame and fortune and hence he has been able to earn so much wealth. As a seeker his spiritual practice is that of offering his wealth for the benefit of others in order to experience renunciation.
* As Bill Gates does not have any craving or attachment to wealth, he now has the privilege to experience first hand, the Bliss of giving away wealth and of the resultant renunciation.
Future of Bill Gates’ spiritual practice
* The wealth acquired by Bill Gates is a result of his pure thoughts and unshakeable faith in the Path of Action.
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* Giving away his accumulated wealth helps do away the sense of achievement associated with it. Thus he will ascend from the level of sacrifice (giving away), where there is a sense of achievement of wealth, to that of renunciation where even this sense of achievement is overcome. This is his goal. Thus he is close to achieving his objective and is now moving towards renunciation.
Summary:
We often look at our lives from a very myopic viewpoint i.e. we are born, we live and then we die and there is nothing before or after that. However, according to Spiritual science, our life is but a part of a continuum of many lives from our first birth till we finally realise God or until our dissolution. In other words, we all come from God and finally have to go back to God. Every time we are born on Earth, it is an opportunity to make spiritual progress so as to move closer to our final goal i.e. becoming one with God. From the standpoint of spiritual growth, the opportunity to be born on Earth, if used well, can result in our rapid spiritual growth.
By donating the acquired wealth, one is liberated even from the thoughts of achievement and one makes progress faster. Bill Gates is an excellent example of this. He is an example of a great evolving soul.
Why Is Bill Gates The Richest Man In The World?
Minggu, Agustus 31, 2008 | succes story with 0 komentar »I'm so excited today as I'm going to share with you one of the top success secrets that is going to change your life forever.
Yes, I mean it. This secret is going to change your life on condition that you put it in action.
First, let me ask you this question:
In your opinion, why is Bill Gates the richest man in the world?
Think a little bit.
"He is intelligent"
"He has a product that runs the world!"
"He is genius"
"He is lucky!!!"
"He is the owner of Microsoft!"
If your answer is like those stated above then allow me to tell you...
NO
NO
NO
Absolutely NOT.
I'm not too harsh.
I just want to direct your focus on an extremely important concept that will guarantee your success in any endeavor.
Listen...
Simply put, Bill Gates is the richest person in the world because...
***... Bill Gates is the most valuable person in the world!
He is extremely valuable. He is serving the whole world. I can claim that he is everywhere all over the planet.
He is adding an irreplaceable value to the world.
Bill Gates is serving the world like no other one is doing. And that is why he is the richest person in the world.
The ultimate secret of everlasting success and wealth is the power of ... SERVICE.
*** Success is about service
The more you serve the more you succeed.
The more value you add to yourself and to the world the more you become wealthy and successful.
Focus on the activities that will increase your value.
Ask yourself: "what is the most valuable usage of my time right now?"
How valuable are you right now?
What actions should you take to increase your value just 1%?
Your little efforts to increase your value compounded over time will yield a great harvest.
Focus on adding more value to yourself and others. This will give you a great head start on leading a highly successful, wealthy life.
My friend, you can make a difference.
I believe in you.
Discover the Winning Marketing Strategy Secrets of Donald Trump Apprentice Wanna-bes
Minggu, Agustus 31, 2008 | succes story with 0 komentar »The highly entertaining Donald Trump's search for an apprentice turned into a hit reality TV show captured attention of millions of Americans and week after week delivered great insights into leadership, business and marketing savvy.
In one of the episodes Trump challenged the two opposing teams of apprentice wannabes (Apex and Mosaic) to put together a bridal gown sale.
Each team had to contact vendors, secure inventory, and most importantly, attract qualified prospects to generate the maximum profits. And here is the kicker - they had just 24 hours to do it.
(For more details read the blow-by-blow outline of this episode.)
Mosaic moved very quickly. They...
1. Zeroed in on a specific strategy: give other bridal shops' opportunity to sell their discontinued designs at drastically discounted prices.
2. Formulated a marketing plan: sent 23,000 highly targeted email announcements to brides-to-be for a cost of $1,000
3. Divided and delegated the tasks and got busy implementing their plan.
As a result of a clear and attractive offer Mosaic easily attracted local bridal shops eager to get rid of their discontinued lines.
Meanwhile Apex jumped right into chasing potential vendors and - without a clear and enticing marketing message - endured one rejection after another.
Discouraged, they almost gave up before stumbling onto a helpful local bridal shop owner who managed to point them in the "right direction".
But just as they had no plan to attract vendors to their gown sale, Apex didn't give any thought as to who their target market was and where they could easily and quickly find large groups of prospects.
Their marketing strategy of handing out fliers at Grand Central and Penn Station (in New York) was unfocused and unnecessarily tied up team members' most precious asset - time.
The results?
Mosaic attracted a city-block-long line or eager-to-buy prospects and generated $12,788.94 in profits in one day! Apex brought in only a handful of buyers and a measly $1,060.47.
Wow! By following solid marketing principles Mosaic beat their opponents by generating almost 12 times as much profits as Apex. So what were their marketing secrets? Well, here they are:
1. THINK STRATIGICALLY! Before you get busy peddling make sure your boat is pointed in the right direction. Take time to formulate your strategy and outline a specific action plan and you'll save time, energy and money, and create the desired results a whole lot faster!
2. Focus on a SPECIFIC TARGET MARKET! If you remember nothing else from this article - remember this one thing - to be successful you must focus your marketing efforts!
3. Find a "HIVE OF HUNGRY PROSPECTS"! Hundreds of thousands of disinterested passers-by at the Penn Station can't even compare to the power of a targeted email blast to 23,000 brides hunting for the best deal on their wedding gown. To quickly penetrate your niche find centers of influence and large networks of your potential clients and get your message in front of them.
4. Evaluate PRICE vs. COST! One of most damaging marketing mistakes is deciding which promotional tools and media to use based on price alone. Even though Mosaic chose a seemingly pricey promotion, ultimately it proved to be less costly based on the repose and results it created.
5. Profit from CO-OPETITION! If you choose your target market carefully there is more business out there than you can possibly handle. Don't fear your competitors - find a way to profit from their business.
Well, there you have it. Go back and read these five points several times. Consider for a moment what implementing these ideas might look like in your business. Make these principles the basis of your business and soon you too will be making money out of thin air - I guarantee it!
Donald Trump. Even his name is impressive. The trump card has the highest value, the biggest number. It was as though he was destined to be The Man. But it wasn't his name that got him where he is today. It was sound financial planning. Sound investing. And it's no big secret. Even though the information about his Trump University is vague, it is pretty easy to read between the lines.
What can we learn from Donald Trump? Well let's look at the language of his section of http://www.worldwidelearn.com/trump/trump-university.htm to find out.
It states, for instance, that he possesses an "unmatched knowledge" of the marketplace. He knows how to spot a deal and how to successfully close it. Knowledge, folks. It's knowledge that got Trump where he is today. Knowledge of the market and of deal-making. It's education that makes it possible. You have to educate yourself financially and then you can begin to invest and enjoy the fruits of your labor. Mental labor.
The side also mentions his "theory of calculated risk." Calculated risk. Everything in life that we do is risky, from driving a car to playing a sport. But if you minimize the risk through learning how to do it properly, chances are you'll be fine. Real estate investing is exactly the same. There is risk involved, but the biggest risk is jumping in with no knowledge of what you're getting yourself into, no knowledge of the process. If you don't take the time to educate yourself, and then take baby steps toward being the kind of investor you want to be, then you are putting yourself at risk. But if you approach investing intelligently, you are building a foundation for your financial future.
Let's take another look at Trump's name. There may be something to it after all, at least on a symbolic level. If a man's name contains his essence, as many ancient cultures believed, then this name is a symbol for this man's essence. He IS the "trump." He IS the high number. His success lies, not just in what he does, but in what he is. It lies not just in the fact that he knows how to "do" wealthy, but in the fact that he knows how to "be" wealthy. What you are is what you think and you can only think what you know. It's all in education. In learning. When you start educating yourself to know what a real estate investor knows, you will learn how to think like a real estate investor. And once you do that, you are on your way to making money.
Robert Kiyosaki, author of the Rich Dad book series, laid it all out in black and white, right there in "Cash Flow Quadrant."
"Rich Dad's Cash Flow Quadrant is about being not doing," Kiyosaki said. "The good news is that it does not cost much money to change your thinking."
Kiyosaki's approach is a holistic one. He says himself that he has not written a "how to" guide. His principles can be used to "strengthen" your thinking for any endeavor. Even becoming rich.
The other good news is, your name doesn't have to be Trump for you to learn how to hold the trump card.
About the Donald Trump Success Story in Real Estate Investing
Minggu, Agustus 31, 2008 | succes story with 0 komentar »Getting the low down on real estate investing straight from Donald Trump is sure to be an educative experience and it will certainly show you how to succeed enough in this line of business to perhaps even become the next real estate investing tycoon for yourself. In fact, it may actually surprise you to learn that in order to become wealthy from the real estate business you need not make any substantial investments. Though at the same time it must be admitted that real estate investing with enough capital is a sure and easy way to build sustainable as well as real wealth.
No Time Like The Present To Get Into Real Estate Investing
To be sure, according to Donald Trump, with mortgage rates not very high at present and with tax laws leaning towards investing in real estate, there is no time like the present to profit from the gold rush in real estate investing that is taking place right now. In addition, he also points out that as many as twelve million homes are transacted in any given year which means that if you know the real estate investing business well enough there is sure to be many lucrative deals on offer that will come your way and from which you too can earn a decent amount of money.
The truth of the matter is that whether you are like Donald Trump, who has made a fortune out of investing in the skyscrapers of New York, or just an average real estate investor the same principles will work in either case and there is no difference except the size of the property being transacted. This of course, raises the question of how an average person can indulging in real estate investing profit the Donald Trump way. The answer is that one should follow one of the philosophies propounded by Donald Trump and that is to improve any location.
As a matter of fact, this is the same way that Trump first succeeded in real estate investing when he began by closing a deal on a twelve hundred unit foreclosure deal in Cincinnati, Ohio. At this time, Trump along with his father turned an apartment complex into a wonderfully successful real estate investing proposition without even investing a penny. Thus, you can take a leaf out of his book and also try to improve locations just like he did in his first real estate investing business venture.
Another tip worth learning from Donald Trump is learning from the knowledge he gained regarding how the government helps property buyers even though they (the buyers) did not have much financial clout. If you too can learn how to avail of such governmental aid, it could put you in a stronger position when you get into real estate investing. Furthermore, you must also be as passionate about this line of business as Trump is, because only then will you also be able to profit from your endeavors.
Trump in fact likens his penchant for making deals to a painter painting on canvas or a poet writing wonderful poetry. Thus, you can draw your own conclusions about whether being passionate about real estate investing will prove to be as profitable for you as it was in the case of Donald Trump. The fact of the matter is that today New York has some very notable examples of the Trump success story in the form of the well-known Trump Tower, The Trump International Hotel & Tower, The Trump Park Avenue and Trump Building located at 40 Wall Street. In addition, the Trump success story has made him owner of a number of golf courses and he is at present also developing another huge building.
Of course, an average person indulging in real estate investing won't be blessed with having the kind of knowledge that Trump owns, and he also won't have the kind of money that Trump commands. However, if you can understand and know what it takes to succeed in this line of business, you too can earn at least a small fraction of the fortune that Trump has earned by learning from the master himself.
