Piano Playing Money Man

Applications for Loans From Moscow & Malaysia?

Internet Awards

Fresh Ingredients for EDA’s Labs

Cyberspace Reports

Sales & Use Tax

Women and Money

Corporate Angels

Corrections or additions?

These articles by Melinda Sherwood and Barbara Fox were published in U.S. 1 Newspaper on May 19, 1999.

All rights reserved.

Digital Editing’s Prime Time: For Everyone Doing

Ad managers and corporate media departments can do just

about anything a big production house can do now that digital editing

equipment — such as Avid — has gotten better and cheaper.

"Some of the systems are so user friendly you can sit down and

start editing right away," says James Boyd, a board member

for Moving Image Professionals of Central Jersey.

Moving Image Professionals will host a non-linear editing equipment

exposition on Wednesday, May 26, at 7:15 p.m. at the Princeton Forrestal

Village food court. The latest models of Avid Express, Media 100,

Fast 601 and Panasonic Post Box — all comparable in price —

will be discussed and demonstrated by representatives from each company.

Cost: $10. For information call 732-821-0831.

Ten years ago, Boyd says, non-linear editing systems cost between

$70,000 to $100,000. Today you can buy a complete turnkey system for

about $25,000 to $50,000. "You can buy the software for $8,000

to $10,000," he says, "but you need a lot of hard-drive storage

space because video eats up a lot of gigabytes."

"If your company is doing any kind of video for the Internet,"

Boyd adds, "this equipment is particularly relevant, since it

can be used with Photoshop and AfterAffects."

Anyone who wants to keep up-to-speed on new media should get acquainted

with the digital system. "Since the CD-ROM," Boyd says, "VHS

is going the way of audio tapes."

— Melinda Sherwood

Top Of Page
Piano Playing Money Man

That great song from "42nd Street," "You’re

in the Money" will be the theme song for Steve Goodman,

a Philadelphia attorney who is also a piano player. Goodman’s jazz

riffs are the feature attraction for the New Jersey Entrepreneurial

Network (NJEN) lunch on Wednesday, June 2, at noon at the Forrestal.

Call 609-279-0010.

Instead of the usual round of self-introductions plus speaker, the

NJEN’s last meeting for the season will give everyone time to do what

they don’t usually have time to do — meet each other. And Goodman

will play, cabaret style, attempting to make himself heard over the


After Wharton, Class of 1962, Goodman was editor in chief of the University

of Pennsylvania Law Review and clerked for U.S. Supreme Court Justice

William J. Brennan Jr. He was a senior partner at Wolf Block, Schorr

& Solis-Cohen before joining the business and finance section in the

Philadelphia office of Morgan Lewis & Bockius.

The NJEN typically attracts entrepreneurs needing capital, professionals

(such as accountants and lawyers) seeking the business of new companies,

and venture capitalists with money to invest in new businesses. The

pianist is so well-liked that this meeting is expected to attract

more than the usual number of Philadelphia investors who are aware

of his musical prowess and would like to hear him play.

"Very few understand how well Steve plays and almost no one has

heard him," says Fred Beste, a partner with the MidAtlantic

Venture Fund. "He says he flipped a coin as to whether to get

a law degree or go to the conservatory." Now Goodman is indeed

a respected attorney with a practice focusing on emerging growth companies.

"Steve is the acknowledged legal guru in this community,"

says Beste. "In the Philadelphia community there are very many

good ones, and you could argue about second place, but nobody would

debate who is in first place. Everybody will tell you he’s the man."

Goodman’s other secondary theme choices are "There’ll be Some

Changes Made," appropriate for venture capitalists with ailing

portfolios, and the ditty from "Damn Yankee," that starts

with the line "You Gotta’ Have Heart." Both entrepreneurs

and venture capitalists do need plenty of heart. If the music stops,

you’ll know the money man has taken a break to do a deal.

Top Of Page
Applications for Loans From Moscow & Malaysia?

As large numbers of people move to PC and Internet banking,

banks in Princeton could start getting business for all over the world

— loan applications from New Zealand and deposits from Malaysia.

So predicts Geoffrey Connor, the former state banking commissioner

who is now an attorney with Reed Smith Shaw & McClay in Forrestal


Connor has put together a morning workshop on electronic banking for

the New Jersey Bankers Association on Thursday, June 3, at 8:30 a.m.

at Forsgate. Anyone may register. Cost: $150. Call 609-924-5550, extension

520. William J. McNichol Jr. of the Reed Smith law firm will

discuss the intellectual property issues of PC and Internet banking.

Paul Tomasofsky, vice president of NYCE Corporation, will ponder

the marketing opportunities. He is in charge of the Remote BankServices

product line, which includes telephone and PC-based home banking and

bill payment services as well as remittance processing services. A

state regulator, William L. Horahan will raise some disturbing

issues regarding senior citizens and electronic banking. Two attorneys

Timothy J. Byrne and Jerald Hurwitz — will discuss

compliance issues.

An alumnus of Williams College, Class of ’68, and Harvard Law School,

Connor was banking commissioner for four years, working for Governor

Jim Florio and briefly for Governor Whitman. In five years, Connor

predicts, electronic banking will be popular with 40 percent of the

market. "And the other 60 percent just won’t do it at all."

If, as a consumer, you want this, "you ought to tell your bank

you want it." But he has these concerns:

Customer identification. The digital signature itself

is secure — a long combination of perhaps 1,000 symbols and numbers

— but what the consumer keys in is relatively short and easily

stolen. As a former banking commissioner Connor is very concerned

about how a 15-year-old could get his parents’ access code and empty

their bank account.

More likely victims are the elderly. "The problem is the older

widow who gives her daughter the electronic key," says Connor.

Right now the daughter can access her mother’s account on the ATM

machine, but as Connor points out, "How much you can take out

of the ATM doesn’t compare with what you can transfer on the Internet."

Marketing opportunities. "When the new generation

is buying a home or a car, you had better be on line if you are offering

loans and mortgages. Suddenly you are not just competing with the

10 banks in your town."

Website personality. A bank website must attract customers

yet look like a bank. "I guess you have to have a picture of a

portico with columns," says Connor. "You have to exude safety

and soundness, confidentiality and trustworthiness, but at the same

time there has to be some interest there."

Regulatory dilemmas. "The regulator has to think about

the world of disclosure, fair lending, truth in lending, and settlement

procedures. They are now based on hard copy; be sure all those same

consumer protections are on the Internet."

Electronic profitability. "For the bankers, the question

is how can this be profitable," says Connor. "Right now a

lot of these internet products are offered without being profitable.

The way to do it profitably may be to offer not too many services

on the Internet — money transfer, routine bill paying, and taking

loan applications."

Theoretically, electronic banking is cheaper than staffing a branch

with people, says Connor, "but it will compress the interest rate

margin, because people will go for the best deal. And if you offer

it electronically you have to offer it in person."

Consumer precautions. Connor says that his own precautions

including using only his "home" ATM machine, never an ATM

machine at a strange bank, to make a deposit. His advice: "I would

make hard copies of everything that is important because deposits

in cyberspace can disappear."

Top Of Page
Internet Awards

Compaq Computer is the platinum sponsor and PricewaterhouseCoopers

and PaineWebber are the silver sponsors of Technology New Jersey’s

First Annual Internet Innovator and Excellence Awards Gala to be held

on Thursday, June 17, at 6 p.m. at the Marriott at Newark Airport.

The non-profit member association has designed a special sponsorship

program that will provide maximum exposure at the event and post-event

benefits. Call Grace Polhemus, president, at 609-924-6117 or

at polhemus@technologynj.org to make arrangements to be a

1999 sponsor.

Individual tickets for the black tie "Celebrated Red Envelope"

ceremony may be reserved directly from the website http://www.technologynj.org.

Cost: $95 for members or $125 for guests.

Top Of Page
Fresh Ingredients for EDA’s Labs

Need space for your technology start-up? Need money

for your start-up? The New Jersey Economic Development Authority says

it has a fresh supply of both on Route 1 South in North Brunswick.

The shell of its second new 40,000-foot building at the New Jersey

Technology Center (Tech II) is finished, and about half of it is still

vacant. The other half has been leased by a Warren-based firm, Celgene,

which trades on Nasdaq as CELG. Celgene has taken 18,000 feet for

the R&D labs of its agrochemical subsidiary, Celgro, and CUH2A is

designing the fitout.

"Part of the state’s strategy for attracting and fostering high

technology business development, the Technology Center is especially

suitable for businesses in the biosciences, micro electronics, and

information technology industries that need space at affordable lease

rates," says Caren Franzini, EDA director. For information

call 609-292-0369 or E-mail red@njeda.com.

Perhaps the most attractive perk for an NJEDA tenant is the hefty,

$100 per square foot fit-out allowance that helps pay for design and

construction of laboratory space. In the case of Celgene, that amounts

to $1.8 million. Other opportunities to qualify for NJEDA monies are

through bond financing, loan guarantees, and direct loans. For a fee,

tenants can use labs and research equipment at Rutgers.

Current tenants in the EDA-owned office park are Advanced Care Products,

a research firm investigating over-the-counter hygiene products, Datamark

Software Inc. (providing electronic customer loyalty programs, the

Rutgers’ Cook College Agriculture Research Project (working in the

regulatory clearance area), and Chubb Computer Services, the technology

training firm. Any firm needing a stand-alone building need only ask

— the park has plenty of room.

The fresh supply of funding comes from Progress Bank, a Pennsylvania-based

bank that has joined the Technology Funding Program. With TFP, high

technology businesses can borrow from $100,000 to $3 million, and

the EDA guarantees a portion of the loan at below market interest

rates. The successful applicants for these monies are usually companies

that have already been funded by venture capital or other private

funding — and they have products under a contract or licensing


"Lending to high tech companies is a specialty industry, and we

to have a bank that is familiar with this is a real plus," says

Rose M. Smith, EDA spokesperson. Progress Bank’s specialized

lending division focuses on early-stage, venture-backed companies.

In just two years it has developed more than 60 relationships and

has more than $60 million in commitments.

Also in the Technology Funding Program are six other banks, including

Summit (which funded Magnetic Specialties), Commerce Bank (which lent

to Price Systems), and PNC Bank. These banks are also committing funds

to "low technology" businesses through the Statewide Loan

Pool for Business. Call 609-292-0187 or E-mail cld@njeda.com

Another fresh source of money is coming, indirectly, through a private

pension. In an unusual reversal, the AFL-CIO Building Investment Trust

(BIT) is partnering with the NJEDA to invest $22.2 million in development

funds for the Technology Center. In return, it will get an equity

position. The first AFL-CIO investment was $8.6 million for a construction

loan. The second investment, $13.6 million, will help to pay for the

fit out costs. "This is the first equity investment we have made

in a project being developed and managed by a public entity,"

says Stephen Coyle, president of the AFL-CIO Building Investment

Trust Corporation. "It has proven to be a highly successful prototype."

Top Of Page
Cyberspace Reports

Consider putting next year’s annual report up on the

Internet as well as — or instead of — publishing a paper version.

Educational Testing Service did that and went from a 32-page piece

with a 55,000 print run last year to 12 pages and only 35,000 copies

this year. "We were looking to something distinctive and felt

we had set a pretty high standard in the past," says Edward

Tate, director of communications at ETS. "We did not save money

this year because we needed to do a print companion piece, but in

future years we expect to reach more people for less money."

The report had national and international distribution to the education

community, public policy decision makers, government leaders, and

elected officials. Unlike some for-profit firms that gave shareholders

the choice of a print or an Internet-based version, ETS made its own

decisions about whom to mail to this year. "No one is compelling

us to distribute our annual report but we have a very wide constituency,"

says Tate. To bring people to the website, ETS mailed postcards and

letters and took out advertisements in education publications.

The home page has a flashing click-through icon and the full address

is http://www.ets.org/etsar. To get the full effect one must

have — or download — Adobe Acrobat Reader, Authorware Web

Player, and Quick Time 3.0.

"Less than one half of 1 percent of all official annual reports

are produced primarily online," says Hans Neubert of Manhattan-based

Belk Mignona, which designed both the web and print version of the

ETS report. Its other clients include Sony and Lands End. "While

it is a growing trend for companies to post their annual reports on

the Internet, these documents are usually just copies of the print

version." The ETS version — complete with video clips, audio

clips, samples of tests, and more than 200 useful links — won

the Big Apple award in the annual report category for the New York

chapter for the Public Relations Society of America.

"This multimedia annual report gives us a chance to demonstrate,

in ways that weren’t possible before, how ETS serves the educational

community," says Nancy Cole, ETS president. Six case studies,

using video clips, show how ETS helps schools and colleges.

Tate admits that no money was saved, at least for this year. "We

essentially produced it for the same budget as last year, but we believe

the reach could be five times greater," says Tate. "You are

talking about a print run of 50,000 versus a web-based report —

where the number of people who can see it is limitless."

Top Of Page
Sales & Use Tax

National Business Institute (NBI) is offering a one-day

program "New Jersey Sales and Use Tax for Manufacturers" designed

for CPAs, attorneys, enrolled agents, controllers, tax managers, financial

vice presidents, or other tax officers of profit and nonprofit corporations

doing business in New Jersey. The seminar will provide manufacturers

and their tax advisors with information necessary to minimize the

sales and use tax burden by examining exemptions developed specifically

for manufacturers.

The class will be held Tuesday, June 22, at 8 a.m. at the Holiday

Inn on Route 1, and on Wednesday, June 23, at 8 a.m. at the Holiday

Inn at Cherry Hill. Cost: $189. Call 715-835-1405.

Michael F. Batelli Jr., senior manager with the multistate tax

services group of the law firm of Deloitte & Touche LLP, and David

J. Shipley, an associate in the state and local tax group of the

law firm of Dechert Price & Rhoads, will be the instructors.

Topics include recent legislative developments; areas of sales and

use tax exposure for manufacturers; manufacturing exemptions; administration,

compliance, and audits; and other tax issues such as bad debts, property

held for use outside the state, and county taxes. This program is

designed to qualify for eight hours of continuing professional education

credit for accountants.

NBI also offers comprehensive manuals prepared by experienced professionals

in each area. They include "Advanced Real Estate Law in New Jersey,"

a guide to procuring and insuring free and clear title, permitting

process and environmental liabilities, ethical obligations, and liens

and credit issues (cost, $59); and "Commercial Lending in New

Jersey," covering fundamentals of commercial loan documentation,

dealing with default, bankruptcy, ethical issues, and lender liability

pitfalls ($63).

Also "Internet Strategies for the Paralegal in New Jersey"

provides an introduction to the information super highway, strategic

use of the World Wide Web, using the Internet for substantive legal

research, and how to become your firm’s vital link to cyberspace ($63).

Call 715-835-7909.

Top Of Page
Women and Money

Women-owned businesses are eligible for financial assistance

and business counseling through several programs offered by the Small

Business Administration (SBA). In 1998, the SBA New Jersey District

Office approved 338 loans, totaling $52.3 million, to women-owned

businesses. "It’s an accomplishment that we’re very proud of and

would like to see repeated in 1999," says Francisco A. Marrero,

a New Jersey district director of the federal SBA.

The Service Corps of Retired Executives (http://www.score.org)

and the NJ Small Business Development Center (http://www.nj.com/njsbdc),

both counseling arms of the SBA, can help women entrepreneurs put

together a firm business plan.

Once that plan is perfected, the SBA offers three financing options:

the Guaranty Loan Program, the Small Business Pre-qualification Program,

and the MicroLoan program. The Guaranty Loan program allows businessowners

to borrow up to $750,000, while the Pre-qualification Program can

provide up to $250,000 in loans. MicroLoans average around $10,000

and the maximum term allowed is six years.

For more information, visit http://www.onlinewbc.org.

or one of the SBA Business Information Centers, located at 2 Gateway

Center in Newark or 200 Broadway in Camden. Here you will find over

200 business guides and several software packages that can help get

your business off the ground.

Top Of Page
Corporate Angels

The First Union Regional Foundation helped to

fund "Building Stronger Centers," a week-long training program

for employees of daycare centers that took place earlier this month.

The landmark program — touted as the only one of its kind —

was organized by the New Jersey Community Loan Fund (NJCLF), the Child

Care Connection, and the Association for Children of New Jersey. It

included management training, technical assistance, and curriculum


More than 50 centers applied for 15 available slots, said Anne

Li of the NJCLF, and those chosen have plans to expand their programs

to meet the demand for child care for working families. Jan Phillips,

program director for Mt. Carmel Guild Day Care, was among the participants,

and other funding came from the Schumann Fund for New Jersey and the

state department of human services and community affairs. Additional

training will be offered in July.

Comcast, the leading provider of cable television and high speed Internet

services in New Jersey will adopt 25 classes at the Liberty Science

Center (LSC), allowing 750 students to visit LSC this year. LSC is

home to more than 250 hands-on exhibits about invention, health, and

environmental themes, numerous science-related activities, and the

nation’s largest IMAX Domed Theater. Call LSC at 201-200-1000.

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