The May Report: 8/8/2011: Bulletin: BigTime Software’s $2 Million Series A Financing Oversubscribed and I’m still looking for a copy of the amended S-1 for Groupon, but can’t find it — nonetheless Erik Sherman says that the accounting probably makes the IPO a no-go with the SEC; Ellen Depodesta on the Saturday, July 23rd talks at TechWeek; Bank of America does so poorly today that they have to cut Richard Cross and Nural Eusufzai — too bad, since Richard can explain Basel II, Basel III, and Basel IV to me (I’m just kidding here)

Editor and publisher: Ron May, ron@themayreport.com, ronaldmay@aol.com, www.themayreport.com , 773-525-3944.

If you missed an article, go here: www.tmronline.com/A55951/tmrarticles.nsf/vwFullNewsletter

Louis Brandeis: “Publicity is justly commended as a remedy for social and industrial diseases. Sunlight is said to be the best of disinfectants.”
_________________________________
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TABLE OF CONTENTS

The Scoop section:

– Has the amended S-1 from Groupon actually been filed yet? If so, I can’t find it, but Erik Sherman says that Groupon’s Wild and Crazy IPO Accounting May Be a No-Go With the SEC
– BigTime Software’s $2 Million Series A Financing Oversubscribed
– Ellen Depodesta: Her summary of some talks on Saturday, July 23rd at TechWeek
– What is the date on this article?: Groupon News Today: Amended S-1, More Atty. Gen. Probing
– Frank Gruber says he had no involvement in the activities at John Barleycorn last Thursday
– Congresswoman Schakowsky press conference rescheduled to Wednesday
– Partnership for a Connected Illinois RFP Webinar Tuesday August 9 2pm Central Time

[Editor's note: May here. Richard Cross took a stab at explaining Basel accords to me on the weekend of BarCamp.

en.wikipedia.org/wiki/Basel_III

www.economist.com/node/16231434

Just to be clear, I am kidding about Richard and Nural getting the boot.

BTW, our old buddy from the MIT-EF, Adolpho Lorenti, who is an economist at Mesirow Financial (along with Diane Swonk) was on Chicago Tonight this evening and he was interviewed on the local news about two weeks ago which I happened to catch. One interesting thing that Carol Marin's panel agreed on: Don't bring Congress back from vacation in August. That will make matters worse so let them have the time off.

Thanks Ellen Depodesta (spelling -- is it a capital "p"?) for the write-up.]
________________________________
The Scoop section:
_________________
Has the amended S-1 from Groupon actually been filed yet? If so, I can’t find it, but Erik Sherman says that Groupon’s Wild and Crazy IPO Accounting May Be a No-Go With the SEC

www.bnet.com/blog/technology-business/groupons-wild-and-crazy-ipo-accounting-may-be-a-no-go-with-the-sec/12205

Groupon’s Wild and Crazy IPO Accounting May Be a No-Go With the SEC
By Erik Sherman | August 8, 2011

Daily deal site Groupon has faced heavy criticism over some of its accounting terminology in the company’s S-1 IPO filing with the SEC. It was bad enough that the Securities and Exchange Commission focused attention on the topic.

Apparently that “focus” has turned into arm twisting. According to Kara Swisher at All Things Digital, Groupon will axe the metric it calls adjusted consolidated segment operating income. Given the current economic climate, that could be a first step in tech companies having to become more conservative in their IPO presentations.

It depends on the meaning of debits and credits

The interest in accounting definitions comes down to GAAP versus non-GAAP financials. GAAP means generally accepted accounting principles. It’s the U.S. standard (the other big one at the moment is IFRS, or international financial reporting standards).

Without independent standards, accounting would be completely subject to the whims of individual companies, and the shifting interpretations can make for enormous differences. Not long ago, for instance, smartphone vendors had to amortize hardware revenue over 24 months because the devices shipped with software, rather than officially recognizing the sales when they happened.

Sometimes companies have reasonable grounds to present non-standard accounting treatments along with the standard ones. Official approaches may unreasonably represent what happens under common practices in certain industries or markets. But once the door is open, companies frequently try to sneak all sorts of stuff through.

Don’t like expenses? Toss ‘em

Groupon had two big quirks it tried to push through. The first was its treatment of gross profit. The idiosyncratic definition seemed to ignore some potentially significant costs that make the number look better than it otherwise might.

But the bigger head-shaker was adjusted consolidated segment operating income, or ACSOI. Groupon wanted investors to look at its results without taking into account some major expenses, including costs of acquiring new customers, acquisition-related expenditures, and stock-based compensation.

The term made Groupon look great. In 2010, Groupon’s GAAP operating loss was $420,344,000. After the adjustments, adjusted CSOI was a positive $60,553,000. That’s a swing of nearly $481 million.

Only, the new definition made no sense. The reason to move outside standard accounting is when staying within gives a misleading portrait of what a company is doing. Groupon’s rationale was that the growth-related expenses were extraneous because the company didn’t have to keep growing at its current pace. But the only thing really keeping the company going is the continued expansion. Those costs became as optional as those checks for steel are to GM.

Just say no

Groupon previously tried to back off from using ACSOI as a “valuation metric” because of previous SEC concerns. It sounds as though even that won’t be enough for the agency. Or investors or the press, for that matter.

The company reportedly plans to drop the term. But that’s hardly the end of the issue. Many companies in high tech, particularly in the Internet wing of the industry, use a variety of metrics. None have seemed so extreme as Groupon’s. However, the U.S. downgrade already presents challenges for IPOs.

As often happens when stock regulation issues come up, expect one prominent example to bring increased scrutiny to everyone else in the same industry – like other tech companies planning an IPO and hoping they can woo investors when the straight-up financial results don’t seem that compelling.
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BigTime Software’s $2 Million Series A Financing Oversubscribed

BigTime Software’s $2 Million Series A Financing Oversubscribed

X

Inbox
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Jeff Lyons JLyons@bigtime.net to me, Brian

show details 9:17 AM (10 hours ago)

from Jeff Lyons JLyons@bigtime.net
to “ron@themayreport.com”
cc Brian Saunders
date Mon, Aug 8, 2011 at 9:17 AM
subject BigTime Software’s $2 Million Series A Financing Oversubscribed
mailed-by bigtime.net
Important mainly because of the people in the conversation.

hide details 9:17 AM (10 hours ago)

Ron,

I thought the following press release re: BigTime Software’s first round of outside funding might be of interest to Chicago-based technology firms seeking capital.

Regards,

Jeff
E. Jeffrey Lyons
President
BigTime Software, Inc.

312-324-3220

Fax: 312-268-6246
Email: jlyons@bigtime.net
Website: www.bigtime.net

1 South Wacker Drive, Suite 2920 ¬ Chicago, IL 60606

BigTime Software’s $2 Million Series A Financing Oversubscribed

8-8-11 9:00 AM EDT

BigTime® Software, Inc., a leading provider of cloud-based productivity tools for growing professional services firms, today announced a $2 Million Series A equity financing. LTC Partners, Geneva Venture Investment Management, Hickory Grove, LLC, and Howell Capital, LLC, participated in the financing.

BigTime’s award-winning time, billing and practice management software integrates with QuickBooks® by Intuit Inc., the leading small business financial platform. By providing a highly customizable, browser-based interface for practice management, professional services firms in industries such as accounting, architecture/engineering, marketing services, design/advertising, consulting, and IT services can instantly deploy and connect BigTime® to existing back-office services.

“BigTime Software is the first B2B cloud-based firm we’ve seen with a sophisticated multi-channel approach to sales,” said Joel Dryer, who led the investor group. “The company has spent years building an active OEM channel and growing their reseller channel, which combine with the web-based sales channels that SaaS firms typically employ. We invested in BigTime’s management team, strong technology, and their potential to drive growth through more than just website traffic.”

Gartner, a leading technology research firm, predicts that the converged cloud and SaaS computing segment will top $10 billion in revenue in 2011, and lists financial management as one of the applications leading the wave. According to IDC, cloud solutions for the enterprise will evolve beyond a separate delivery model to become “simply the way IT is done.”

“Cloud computing is an explosive growth area, and most industry analysts are suggesting that what we’ve seen so far in the B2B space is only the beginning,” said Brian Saunders, the firm’s founder and CEO. “With the support of the Company’s first group of outside investors, we can take advantage of that dynamic within our own specific sector of the market.”

“Our flagship product is continuously being enhanced to meet the needs of our growing customer base and partner network,” added E. Jeffrey Lyons, president. “With this round of financing, we are poised to take our cloud-based, scalable solution to the next level of growth, both as an independent company and as a strategic partner with other industry leaders.”

The proceeds from the Series A Financing will be used by the Company to build its sales channels, expand its marketing and product development efforts, and explore new strategic partnerships. Neal, Gerber & Eisenberg, LLP, represented the Company in the financing. Shefsky and Froelich, Ltd. represented the lead investor group in the financing.

About BigTime® Software, Inc.

BigTime® Software, Inc. is a privately held firm focused on cloud-based productivity tools for growing professional services firms. Founded in 2002, the firm released its flagship product, BigTime®, one year later. BigTime has provided productivity tools to thousands of firms across North America, the United Kingdom, and Australia. Its clients include high-growth professional services firms in a dozen industries including accounting/tax, law, IT services, public relations, marketing services, design/advertising, architecture/engineering, and management consulting. BigTime is an Intuit Gold Certified Developer and a member of the Microsoft Partner Network. For more information, please visit ,www.bigtime.net.

cts.businesswire.com/ct/CT?id=bwnews&sty=20110808005050r1&sid=mstar&distro=nxGeoffrey Mogilner
Financial Dynamics
312-861-4720
geoff.mogilner@fd.com

Copyright Business Wire 2011

E. Jeffrey Lyons I President

BigTime Software, Inc.

( Phone: 312-324-3220

7 Fax: 312-268-6246
* Email: jlyons@bigtime.net
þ Website: www.bigtime.net

1 South Wacker Drive, Suite 2920 ¬ Chicago, IL 60606
________________________________
Ellen Depodesta: Her summary of some talks on Saturday, July 23rd at TechWeek

Subject: RE: Ellen, please send me a summary of your Saturday sessions at TechWeek.
Date: 8/8/2011 4:46:57 P.M. Central Daylight Time
From: edepodesta@sbcglobal.net
To: RONALDMAY@aol.com

Ron –

Saturday morning I attended “The Startup Puzzle” panel at 9:30 – Dane Drotts
of GeneXus USA was a panelist, along with Jon Roa of AKTA and Katy Lynch of
SocialKaty. The three of them (each having expertise in technology
development, UI/UX development, and social media, respectively) talked about
the advantages to startups of working with pure play firms that have a
single specialized expertise (but are part of a larger ecosystem), as
opposed to working with one firm that tries to be everything to everyone.
There was a lot of discussion about how Chicago has become a center for
entrepreneurship. The panelists agreed that there is a strong sense of
community, a great desire to help others, a focus on education, and a wealth
of resources here to help startups succeed. Some of the resources mentioned
were the CEC (Chicago Entrepreneurial Center), incubators like TechNexus and
Accelerate Labs, and the depth of the local community of angel investors.
The panelists talked about the value of entrepreneurs bringing their ideas
to investors (with a well-thought-out presentation) early on in the process,
to get their feedback as soon as possible. The panel also talked about the
power of social media for lead generation, and shared ideas to drive traffic
like on-site referrals and creative ways to handle event registration and
on-boarding. Lastly, there was a discussion about the power of mobile
technology to reach customers everywhere they go, and the importance of
creating mobile apps. There were about 30 companies represented in the
audience.

—–Original Message—–
From: RONALDMAY@aol.com [mailto:RONALDMAY@aol.com]
Sent: Friday, August 05, 2011 6:51 AM
To: edepodesta@sbcglobal.net
Cc: ronaldmay@aol.com
Subject: Ellen, please send me a summary of your Saturday sessions at
TechWeek.
____________________________
What is the date on this article?: Groupon News Today: Amended S-1, More Atty. Gen. Probing

www.nbcchicago.com/blogs/inc-well/Groupon-News-Today-Amended-S-1-IL-Atty-Gen-Copycats-125634918.html

Inc Well
Groupon, Lefkofsky, Backpedaling, Copycat Attorney Generals
Groupon News Today: Amended S-1, More Atty. Gen. Probing

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Email
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Print
Groupon News Today: Amended S-1, More Atty. Gen. Probing

A day doesn’t often pass without news from Groupon – and this Friday is no different, beginning with its amended S-1 filing on Thursday afternoon. The company re-filed its statement with the SEC which, among other things, retracts co-founder Eric Lefkofsky’s “wildly profitable” statement and adds more underwriting banks, which is now a total of 14. Those inclined to read the entire statement can do so here. Also, after the Connecticut Attorney General questioned Groupon’s business practices, Illinois also wants to have a word. Read more:

* Groupon adds a disclaimer for Lefkofsky’s boasting about Groupon’s future profits (Wall Street Journal) and proves that more banks want in on its IPO action. (Wall Street Journal).

* Attorney General Lisa Madigan wants to know how Groupon’s business practices fit into Illinois law, with plans to talk in August. (Crain’s).

* Amid all the Groupon buzz, Lightbank talks about its approach to finding entrepreneurs. (FastCompany).

* An interesting take on young guys learning from old pros: the New York Times explains how Groupon can learn from Motorola, even pointing out similarities in the company names. (New York Times).

Todays deal: $10 for $25 worth of food at Theory.

Source: www.nbcchicago.com/blogs/inc-well/Groupon-News-Today-Amended-S-1-IL-Atty-Gen-Copycats-125634918.html#ixzz1UUJyyPdW
______________________________
Frank Gruber says he had no involvement in the activities at John Barleycorn last Thursday

Subject: Re: Frank, were you involved in event below @ John Barleycorn’s on Thurs., the 4th.
Date: 8/8/2011 9:47:31 A.M. Central Daylight Time
From: frank@techcocktail.com
To: RONALDMAY@aol.com

Hi Ron,

Nope I was not involved in that event. Hope you are having a good summer.

Best,
Frank

Please Note: This message was handcrafted while on the go from my mobile device, so please excuse any silly typos.

On Aug 8, 2011, at 6:48 AM, RONALDMAY@aol.com wrote:

Query — gee, how do you spell Frank Gruber? Frank, if that is not you, I’ll eat my hat

Query:

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Congresswoman Schakowsky press conference rescheduled to Wednesday

Subject: Congresswoman Schakowsky press conference rescheduled to Wednesday
Date: 8/8/2011 4:16:45 P.M. Central Daylight Time
From: leo@howehutton.com
To: leo@howehutton.com

Community media contacts: Note rescheduling

I talked to the Congresswoman’s scheduler and it will be Wednesday instead of Monday.

Wednesday, August 10 at 10:30am

at

William C. Goudy Elementary School

5120 N. Winthrop

Chicago, IL 60640

Enter through Door #2

Parking is available at 5017 N. Winthrop. The lot is just north of Argyle on Winthrop, which is one way going south. Or take the red line to the Argyle stop.

A summary of the bill is below. We hope you can join us for this important event!

The Emergency Jobs to Restore the American Dream Act

Rep. Jan Schakowsky

· Creates over 2 million jobs to address the real crisis facing America: the jobs crisis.

· Emergency jobs are created for two years, to provide time to get the economy back up and running.

· Emergency jobs will meet critical needs to make American communities stronger.

· Costs $221 Billion ($110.5 billion for each of fiscal years 2012 and 2013).

· Can be fully paid for through separate legislation such as Rep. Schakowsky’s Fairness in Taxation Act, which creates higher tax brackets for millionaires and billionaires, eliminating subsidies for Big Oil, and through eliminating tax loopholes for corporations that ship American jobs overseas.

THE CORPS: 2.1 Million Jobs

1) School Improvement Corps – Creates 400,000 construction and 250,000 maintenance jobs through new funding to public school districts for needed school rehabilitation improvements ($100 billion)

2) Park Improvement Corps – Creates 100,000 jobs for youth between the ages of 16 and 25 through new funding to the Department of the Interior and the USDA Forest Service’s Public Lands Corps Act. Conservation projects on public lands include restoration and rehabilitation of natural, cultural, historic, archaeological, recreational and scenic resources. ($400 million)

3) Student Jobs Corps – Creates 250,000 more part-time, work study jobs for eligible college students through new funding for the Federal Work Study Program. ($850 million)

4) Neighborhood Heroes Corps –

a. Teachers: Direct funding to states to hire, re-hire, and prevent lay-offs of 300,000 teachers. ($40 billion)

b. Cops: New funding to hire 40,000 police officers. ($10 billion)

c. Firefighters: New funding to hire 12,000 firefighters. ($2.4 billion)

5) Health Corps – Grants to hire at least 40,000 health care providers, including physicians, nurse practitioners, physician assistants, nurses, and health care workers to expand access in underserved rural and urban areas. ($8 billion)

6) Community Corps – Creation of a new Community Corps that will create 750,000 jobs to do needed work in our communities, including energy audits and conservation upgrades, recycling and reclamation of reusable materials, urban land reclamation and addressing blight, including foreclosure and disaster-affected areas, rural conservation work, public property maintenance and beautification, housing rehabilitation, and new housing construction modeled after Habitat for Humanity. ($60 billion)

Standards for new programs:

· Priority for jobs given to the unemployed, particularly those who have exhausted their unemployment benefits (the “99ers”).

· Formulas will allocate fair distribution of funding and jobs among states, with targeting based on high unemployment and need.

· Ensures that jobs don’t undercut the rights of other workers or lower wages.

· Ensures work is additive and doesn’t displace current workers or take business from small/local businesses.

· Includes trigger for phase-out if unemployment drops below 5%.

Frances E Roehm
SkokieNet Librarian/Community Liaison
Skokie Public Library
5215 Oakton St
Skokie, IL 60077
847.324.3173
froehm@skokielibrary.info

SkokieNet: Building Community and Making Connections Since 1995!
__________________________
Partnership for a Connected Illinois RFP Webinar Tuesday August 9 2pm Central Time

Subject: Partnership for a Connected Illinois RFP Webinar Tuesday August 9 2pm Central Time
Date: 8/8/2011 4:21:05 P.M. Central Daylight Time
From: leo@howehutton.com
To: leo@howehutton.com

Reminder to development researcherss, planners and broadband adoption advocates,

See link at the bottom of the message below to tomorrow’s bidders conference webinar on the RFP for broadband demand data survey and analysis work.

Layton Olson

Consultant to Partnership for a Connected Illinois

Important message from PCI Executive Director Drew Clark announces RFP Webinar:

“The Partnership for a Connected Illinois recently issued a Request

for Proposals with regard to collecting information on broadband use

and adoption trends throughout the State of Illinois.

The purpose of this RFP and any resulting contract award is to solicit

proposals for benchmarking uses of broadband, its benefits, the

drivers for greater uptake of broadband services, and the barriers to

uptake focused on businesses, community anchor institutions and

households throughout Illinois.

PCI has extended the deadline for response to the RFP to Friday,

August 26, 2011.

The web address for the overview of the RFP is:

www.broadbandillinois.org/Use-it/Opportunities.html

The web address for questions and answers about the RFP is:

broadbandillinois.org/Use-it/Opportunities/Q-A-Technical-Assistance-for-Broadband-Planning-and-Adoption-RFP.html

The web address for the Adobe PDF version of the RFP is: here

The web address for the Microsoft Word version of the RFP is: here

We are reaching out to you now, as one who might be interested in

either participating in this RFP, or in making use of the end-product

that we anticipate resulting from this RFP, to solicit your feedback

and questions.

Please send your questions and feedback (and we do encourage both!) to

info@broadbandillinois.org.

We will make all efforts to answer all questions that are received on

the Q&A page described above. All questions that are answered will be

posted on the Q&A page described above.

PCI will be holding a bidder’s conference webinar to discuss the RFP

on Tuesday, August 9, at 2 p.m. CT. The webinar is free and open to

the public. All who might be interested in either participating in

this RFP, or in making use of the end-product that we anticipate

resulting from this RFP, are strongly encouraged to register and

attend the bidder’s conference webinar.

Additionally, I am pleased to announce that John Horrigan, the dean of

broadband adoption and demand survey research (and formerly of the Pew

Internet & American Life Project and the Federal Communications

Commission), has agreed to advise PCI on our RFP and to participate in

the bidder’s conference webinar.

Please register now to attend the bidder’s conference webinar, here Thanks!

Sincerely,

Drew Clark

Executive Director

Partnership for a Connected Illinois”

–

Amy McDaniels

Executive Assistant

Partnership for a Connected Illinois

Springfield, IL 62704

217-886-4035 (office)

217-899-1692 (mobile)

amy.mcdaniels@broadbandillinois.org

–
Please respond to:
Layton Olson
broadbandillinois.org
312-263-3001
_____________________________
END OF REPORT