March 5th, 2014
Ira Solomon, dean and Debra and Rick Rees Professor of Business, recently co-authored an opinion piece for CFO.com criticizing the Public Company Accounting Oversight Board (PCAOB) for misleading statements regarding the quality of public company audits.
Solomon and co-author Mark Peecher, professor of accountancy at the College of Business at the University of Illinois at Urbana-Champaign, take issue with the PCAOB for its use of the term “audit failure” — which has traditionally referred to the joint occurrence of an unqualified audit opinion and materially misleading financial statements — to describe audits in which the auditor simply failed to obtain sufficient appropriate evidence to support its opinion on the financial statements, regardless of the fairness of the financial statements in question. The authors go on to say that PCAOB criticisms of auditors’ evidential bases are themselves open to criticism.
One reason is that PCAOB inspections usually occur after fieldwork, so hindsight bias can surface, especially when inspectors try to assess audit work on management’s estimates, which often are predicated on future economic events. That is, inspectors form retrospective judgments about auditors’ judgments regarding the reasonableness of management’s judgments. The management judgments in question concern things like the reasonableness of complex financial-statement estimates or the sufficiency of internal controls. It is hard to manufacture precision at the end of this judgment chain when it starts with so much ambiguity and uncertainty.
To read the article in its entirety, visit CFO.com:
February 28th, 2014
The Tulane Entrepreneurs Association (TEA) has announced eight semi-finalists for the group’s newly revamped Tulane Business Model Competition.
The 2014 Tulane Business Model Competition will award $35,000 to startup ventures with consumer-tested business ideas.
After a 13-year-run, the contest was redesigned to better reward the practical aspects of what make startups successful – the ability to rapidly adapt to customers’ needs. It offers a $25,000 grand prize and $10,000 for the runner-up.
“From food carts and hospitality ventures to educational technology and biomedical devices, our eight finalists truly represent a cross-section of the New Orleans startup scene,” says Ralph Maurer, executive director of the Levy-Rosenblum Institute for Entrepreneurship. “I’m looking forward to seeing how these talented young entrepreneurs hone their business models in preparation for the final competition on April 11.”
The semi-finalists are:
• ComeFail, a space for college students to fail safely and a platform for supportive learning and exploration.
• CCC, a venture that offers customized volunteer and hospitality experiences for customers so that they can easily enjoy, learn, and support New Orleans like never before.
• Fleur de Latkes, a new food cart and catering business in uptown New Orleans that specializes in bringing a modern take on your “bubbe’s” Jewish cooking down to NOLA.
• InVision Biomedical, a firm that takes existing innovative procedures and implements novel medical devices, expanding patient safety and hospital cost efficiency.
• Million Dollar Scholar, an education technology and services venture that addresses higher education affordability by providing students with an online platform to learn how to become successful in the scholarship application process
• Threadix, an event management and data analytics company utilizing the latest technological innovations in near field communication to allow advertisers and event organizers new methods to expand branding opportunities.
• Tympanogen, a firm commercializing a gel patch developed at Tulane University, called Perf-Fix™, for non-surgical repair of chronic tympanic membrane perforations.
• US Fresh Cane, a sugar cane drink company that provides consumers an alternate and natural drink that can improve their health and fitness levels.
Semi-finalists receive $1,000 each and get to pitch, receive mentoring and network with a variety of lean startup experts on Tuesday, March 25, during New Orleans Entrepreneur Week, the sixth annual premier showcase event for the local entrepreneurial ecosystem. Ultimately, three finalists will present their business models at Tulane University on Friday, April 11, 2014.
Tulane is now taking after the International Business Model Competition, a contest that wants ventures to prove customer validation and adapt to the process of creating a business model. Instead of intensive library research, student entrepreneurs will get out in the field and prove their assumptions.
TEA President Adrian Mendez believes the competition provides a deeper learning opportunity and a more guided process for those interested in launching and running a company. “Essentially what we’re doing is creating an evolution of what has been established at Tulane, allowing for students to quickly prototype and execute ideas instead of just participating in a one time pitch.”
“The competition has always been a flagship event that supports local–now regional– entrepreneurs and programs,” Mendez says. “As the program grows, we hope to continue to motivate and inspire students to be on the forefront of entrepreneurial activity with the resources we provide.”
Follow the Tulane Business Model Competition on Facebook at facebook.com/tulanebusinessmodelcompetition and on Twitter at twitter.com/tulanebmc.
January 21st, 2014
After hosting one of the region’s premiere college business plan competitions for 14 years, the Tulane Entrepreneurs Association (TEA) has completely redesigned the contest to better reward the practical aspects of what make startups successful – the ability to rapidly adapt to customers’ needs.
The 2014 Tulane Business Model Competition will award more than $35,000 in prizes to new business ventures demonstrating a customer-validated business model.
Instead of rewarding the theoretical, the new contest wants ventures to show they’ve worked with potential customers to vet their services, adapted to those needs and shown the ability to quickly change course if the market disproves their assumptions. The new Tulane Business Model Competition offers a $25,000 grand prize and a $10,000 award for runner-up.
“In this contest, sleek presentations are not going to cut it,” said Ralph Maurer, executive director of the Levy-Rosenblum Institute for Entrepreneurship at Tulane University’s A.B. Freeman School of Business. “Participants won’t be rewarded for overly ambitious sales projections, drawing fancy graphs or crafting the perfect pitch to venture capitalists.”
Instead the contest rewards teams for breaking down their idea into a key business model hypotheses; testing their assumptions with customers; applying Customer Development/Lean Startup principles to make sure they nail the solution; and learning to pivot until they have a customer-validated business model.
The contest is open to any team led by at least two or more students enrolled in a college or university. To enter, teams must submit a video presentation – normally a voice annotated slide deck no longer than 10 minutes – online by 11:59, Feb 14. More details on submission criteria are available at: http://tulane2014.istart.org/ .
“Entering the first round of the competition doesn’t require a significant time investment, and it’s a worthwhile exercise for anyone working on a startup,” Maurer said.
TEA will select eight semi-finalists who will win $1,000 each and get to pitch, receive mentoring and network with a variety of lean startup experts on Tuesday, March 25, in New Orleans. Ultimately, three finalists will present their business models at Tulane University on Friday, April 11, 2014.
- Keith Brannon
January 16th, 2014
From The Times-Picayune | NOLA.com, Jan. 15, 2014:
Geoffrey Smith, visiting assistant professor of finance at Tulane University, described Bitcoin as an “alternate means of storing value” that investors are using as a hedge against the dollar. He said it needs more stability, but he thinks it has potential to catch on, particularly because of its inflation-fighting finite supply.
The system is expected to create 21 million Bitcoins and then stop issuing more. The coins often are traded as fractional units. The web sites bitcoinexchangerate.org and bitcoincharts.com reported Wednesday morning that one Bitcoin translated to about $830.
“People can use anything as currency,” Smith said. “In jail, people use cigarettes.”
“There’s nothing special about paper with green ink,” and nothing wrong with competing currencies, he argued. “It’s based on faith that it has value.”
To read the article in its entirety, visit NOLA.com.
January 14th, 2014
As director of the Freeman School’s Burkenroad Reports program, Peter Ricchiuti has spent more than 20 years highlighting the small, profitable companies that often fly under the radar of Wall Street. Now, Ricchiuti has collected some of the lessons he’s learned over the years in a new book.
Stocks Under Rocks shares some of the lessons of the Freeman School’s Burkenroad Reports program.
Stocks Under Rocks: How to Uncover Overlooked, Profitable Market Opportunities (FT Press), co-written with New Orleans Advocate features editor Annette Sisco, is a funny, informative guide to investing based on Riccchiuti’s experiences running the acclaimed student equities research program.
“It’s all the stories I tell in class and all the stories we get from visiting with the companies, but integrated into the funny stories is what we found that makes those companies a smart investment,” says Ricchiuti, a professor of practice in finance. “Every company represents a few anecdotes and a few funny stories but also one investment lesson learned.”
For example, don’t limit your investments to hip, sexy stocks. Ricchiuti says hopelessly unfashionable companies like pawn shops and convenience stores may not win you many points at cocktail parties, but they often generate higher returns than the latest media darling tech company.
“It’s the least attractive stuff,” Ricchiuti laughs, “but when you look at the financials, they all have great stories.”
Investors willing to look beyond the surface would learn that Cash America, for example, the pawn shop company, actually derives much of its revenue from a lucrative online loan business, while Susser Holdings, operator of Stripes convenience stores, attracts customers with a chain of high-quality in-store Mexican restaurants.
Ricchiuti says the biggest lesson of all when it comes to regional small-cap stocks is that individual investors really can gain an advantage over Wall Street.
“The conventional wisdom, particularly in academia, is that every stock is already efficiently priced, but when you get down low enough and small enough, there’s often times no other coverage,” Ricchiuti says. “If you’re willing to do the research, you really can know more than anyone else, and for an investor, that’s a great place to be.”
Peter Ricchiuti will be reading from and signing Stocks Under Rocks at the uptown location of Maple Street Book Shop on Thursday, Feb. 6, at 6 p.m.
December 10th, 2013
A class of students at the A. B. Freeman School of Business delivered their final presentations on Friday (Dec. 6), but these projects were for more than just a grade. They were to see which team would earn the right to have its marketing campaign executed by Fox Sports.
In December, Freeman students pitched 360-degree marketing campaigns to executives with Fox Sports. (Photo by Paula Burch-Celentano)
The presentations were the culmination of a semester-long project that took students in Professor of Practice John Howard’s undergraduate Advertising and Brand Promotion class and put them to work on behalf of Fox Sports New Orleans. The assignment? Create a 360-degree marketing campaign to promote the network’s coverage of Louisiana high school sports.
The students spent the semester conducting market research and developing ideas encompassing print, radio, TV and outdoor advertising as well as event marketing and social media. On Friday, representatives from Fox Sports and the Louisiana High School Athletic Association (LHSAA) were on hand to see the results of their efforts and choose the winning campaign.
One team created a TV commercial that juxtaposed Louisiana imagery like wild alligators and flying Mardi Gras throws with football scrums and flying footballs. Another designed a clever campaign logo that added football laces to a fleur-de-lis.
In the end, after five hours of presentations and much deliberation, the judges selected “Louisiana: You Create Legends. You Make History,” a campaign built on the state’s reputation for producing future NFL stars, as the winner.
Mary Hyink, director of marketing with Fox Sports New Orleans/Southwest, said judges were particularly impressed by the team’s idea for an accompanying social media hashtag, #WheredYaGeaux, that plays on the local custom of identifying people by where they went to high school.
Fox Sports New Orleans plans to use the campaign developed by a team of Freeman School students, above, to promote its coverage of Louisiana high school sports. (Photo by Mary Hyink)
“That really struck a chord with us,” said Hyink. “There were a lot of terrific presentations. I think for us, the true benefit is that not only did we have a winning team, but there were also other teams that we will probably pull an idea or tactic from to add to what we bring to life on air.”
The high school sports campaign was Tulane’s first project in association with Fox Sports’ Creative University program, which involves students in hand-on marketing and communications projects for the network. Tulane is one of 20 universities that Fox Sports has partnered with for the program.
“Our hope is that we’re giving students some real-life, real-client, real-world experience,” said Lindsay Amstutz, vice president of marketing for Fox Sports Networks. “For us, it’s a tremendous pipeline for potential talent. We’ve hired a lot of students who went through Creative University. It just really helps us tap into these young, creative minds.”
November 26th, 2013
From WSJ.com, Nov. 25, 2013:
And while such superstitions can be broken, says Dr. Johar, it often takes a lot of negative evidence before people are willing to part with their lucky rituals. That’s because they “provide some sort of a hedge against uncertainty,” says Eric Hamerman, an assistant professor of marketing at Tulane University’s Freeman School of Business who, with Dr. Johar, co-wrote the study, published in October in the Journal of Consumer Research.
To read the article in its entirety, visit WSJ.com.
November 11th, 2013
From HBR.org, Nov. 8, 2013:
Ralph Maurer, professor of practice and interim executive director of the Levy-Rosenblum Institute for Entrepreneurship, co-authored an article for the HBR Blog Network about how Tulane School of Medicine is embracing disruptive innovation to deal with some of the challenges currently facing academic medicine. The article was written in collaboration with Benjamin P. Sachs, senior vice president and dean emeritus of Tulane School of Medicine, Marc J. Kahn, senior associate dean of Tulane School of Medicine, and Steven A. Wartman, president and CEO of the Association of Academic Health Centers.
One solution to this problem is moving the majority of primary and secondary healthcare delivery into the community. After Hurricane Katrina, Tulane partnered with a network of Federally Qualified Health Centers in order to provide services to low and middle-income patients in community-based clinics designated as medical homes. These not only provide less expensive care, but also provide the kind of experiential learning necessary to teach expertise to trainees.
To read the article in its entirety, visit HBR.org.
November 6th, 2013
The Internet is a powerful force that’s still evolving in unexpected, exciting and cool ways. The promise of the Internet is that “it actually lets us achieve our maximum for awesome,” said Alexis Ohanian, co-founder of Reddit, a social news and entertainment website with 81 million unique visitors a month.
Tulane alumnus Erik Martin, right, general manager of Reddit, a wildly successful social news and entertainment website, and Alexis Ohanian, Reddit’s co-founder, discuss the advantages of being a humanities major in a tech world. (Photo by Paula Burch-Celentano)
Ohanian spoke at a Tulane Entrepreneurs Association event on Friday (Nov. 1) as part of a 150-stop bus tour promoting his book Without Their Permission.
All links on the World Wide Web are created equal, Ohanian pointed out. “That means that any one of us with our Internet connections and our great ideas can spread them faster and further than ever before. We can use the Internet as an amazing stage and library for knowledge.”
Joining Ohanian on stage was the general manager of Reddit, Erik Martin, a 1999 Tulane University graduate.
Ira Solomon, dean of the A. B. Freeman School of Business, introduced Martin — named one of TIME magazine’s 100 most influential people — as “perhaps Tulane’s favorite alum who is at the center of the tech world.”
Reddit is a bulletin board, where users post links and original text, called “selfs.” It is “an extremely powerful voice for sharing knowledge and for shaping public opinion,” said Solomon.
“Subreddits” are postings organized by subject areas. Reddit users vote up or down on postings, determining a posting’s ranking and position on the page.
Martin said that his education (he earned a BA in American studies) taught him how to recognize cultural patterns, a skill that comes in handy now as he organizes the intersections of interesting things “to unpack and explore” on Reddit postings.
“I’ve been lucky enough to do at Reddit [what he did as an American studies major] … to look and see how there’s something really interesting going on,” Martin said. “Let’s see where it can go.”
— Mary Ann Travis