FINANCE COMMITTEE TO HOLD HEARINGS ON ATM FEES - Issue 16 - March 2007

FINANCE COMMITTEE HEARINGS ON ATM FEES: SPRING ‘07

Ottawa, February 28 07 – The Clerk of the Federal Standing Committee on Finance (FINA) has confirmed to the Frontier Times that FINA will be holding a hearing on ATM fees.

The specific date of the hearing has yet to be scheduled, but sources to the FT suggest that it will likely be this spring following on numerous requests for such a hearing.

Background

If you have aver visited a Canadian factory employing immigrant labour, you know how important ATM machines are to working people. Anyone in the payments business knows that the un-banked and underbanked pay disproportionately higher percentages of their overall transaction volume in transaction fees. The factory worker who withdraws $80 of pay and pays a $1.50 transaction fee is paying a lot more for their money than the high income individual who withdraws a few hundred dollars at a time for the same fee. This is the thinking behind an NDP proposal to amend the Bank Act to do away with ATM fees at bank-owned ATM machines.

NDP Takes a Bold Stand

In an interview with the FT, NDP Press Secretary, Ian Capstick, said: “It is unjust for Canadians to pay ATM fees. We want them banned. The banks earned $19 Billion in profit, taking away fees would not hurt their bottom line and they probably owe it to Canadians anyway.” When asked by the FT if the NDP took into consideration the cost of supplying the machines and the cash in the machines, Capstick said that those cost factors were taken into consideration when the NDP put together its policy on the issue. The 69% of Canadian ATM machines that are not owned by banks and are owned either by provincially regulated credit unions or white label independent operators would be exempt from the federally mandated NDP proposal.

When asked if the quazi-monopoly bank-controlled Interac debit network should bear any of the responsibility for the high fees, Capstick said: “It’s a monopoly, but possibly they [the banks] are in collusion.”

Government Seeks To Protect Less Mobile

An Officer of the Department of Finance in Ottawa confirmed to the FT the intention of the Minister of Finance, Jim Flaherty, to meet with the Canadian banks to discuss ATM fees. The meeting took place on March 5^th after which the Minister told the media that he expects the banks to respond to complaints over bank fees insofar as they concern seniors, students and persons with disabilities.

Time will tell whether the lack of competition in the Canadian domestic bank market is something that government will change.

Canadian Banks Not Impressed

Responding to the NDP proposal, Raymond J. Protti, President and Chief Executive Officer of The Canadian Bankers Association (cba.ca) said “This is just typical NDP bank bashing and political rhetoric being made without a full understanding of the facts […]”. “It’s like saying to clients of a gym; we’re going to let customers of other gyms in to use the weight room. We’re not going to charge them, and you’ll be subsidizing their use of it,” Mr. Protti said.

Maura Drew-Lytle, Senior Manager, Media Relations at the CBA, in an interview with the FT said that the system we now have is fair, transparent and competitive because the fees paid by customers are disclosed to the customer at which time the customer has a choice to accept the transaction or go to another ATM that might not charge a fee. Drew-Lytle said that the CBA took issue with the NDP proposal in part because it would affect only bank-owned ATM machines and it would therefore unfairly discriminate against them as compared to the independent or provincially regulated operators not covered by the NDP proposal.

When asked to comment on the argument that bank fees are paid in much greater proportion to income by those with least income, Drew-Lytle said that the fees are easy to avoid and that the banks have built their networks to help their customers. When asked to comment on the fact that bank fees are a very small portion of bank revenue and yet a source of huge frustration for customers, Drew-Lytle said that 75% of customers avoid bank fees by using their own banks’ machines.

The CBA takes the position that Convenience fees are just “a small fee charged to consumers who want to benefit from the convenience of using an ABM when and where they want to. It’s the consumer’s choice and every time they do a transaction at a machine not owned by their bank, they are given the option of paying the fee or cancelling the transaction. It is very transparent.”

“Mr. Layton talks about regulating these fees for banks but he is focusing on the lowest cost providers,” said Mr. Protti. “Banks have 31 per cent of the machines in the market so the other 69 per cent, which are independent operators and have higher fees, would continue to be unregulated.”

Competition Side A: The Customer

Protti, Drew-Lytle and the latest CBA publication of February 2007 all emphasize their position that the Canadian ATM market is competitive. The CBA interpretation being that ATM users are capable of choosing which machine they will use. If Canadian bank customers really have that much choice, it begs the question of why there are 35,000 machines outside of the banks own networks to service Canadian bank customers. Put another way, the most likely raison-d’être for those 35,000 non-bank machines is precisely because people using them do not, for all practical purposes, have the choice to use a bank-owned machine.

Competition Side B: The Supplier

As we have previously reported in the FT, non-bank ATM operators in Canada are apoplectic over the inability to procure necessary inputs from Canadian banks for the supply of their services; notably, cash. The cost to white label operators to access cash renders the playing field for them uneven because banks have access to cash from their own reserves at no incremental cost.

NDP Web Site

The NDP has made ATM fees a major part of the message delivered by its web site (ndp.ca). The site features a major banner with the head line “End ATM Fees Action Centre”. Clicking on the banner brings the reader to an elaborate flash media mock ATM machine that details bank profits and why the NDP is railing against bank fees for the benefit of ordinary Canadians who the NDP says are being unnecessarily “nickel and dimed”.

By Adam N. Atlas, Editor in Chief

NOTE FROM THE EDITOR

You don’t have to sit on the Finance Committee to know that there is too little competition in the Canadian consumer banking market.

Ask any Canadian consumer if they believe there is enough competitors for their business, and your answer will be clear. Even better, ask a foreign business trying to do business in Canada about the pleasures of dealing with Canadian banks. Without an exception, every US client of mine in my legal practice who has tried to discuss business opportunities with Canadian banks has had what they describe as horrific experiences: calls that are not returned, attitudes concerning bank services that date from the 19th century, an assumption that the caller is without merit or value to the bank. The list of grievances goes on and on. In the absence of real competition, these problems will be a fixture of our Canadian heritage. One of my favorite examples of poor customer service on the part of Canadian banks is how one of the big five Canadian banks has banned this publication from mentioning its name or contacting its representatives.

The upcoming FINA hearings on ATM fees will be an opportunity for participants in the industry to express themselves as to the fees, but also the bank-owned infrastructure in which they are levied. A spokesperson for the NDP told the FT that the banks may possibly be in collusion through the Interac association. This is a troubling fact. Troubling because a representative of a national political party has raised the possibility of collusion amongst banks that are presenting competitiveness (see our cover story) as one of the features of their offerings. What is more, Interac is presented to the Canadian consumer as a secure and friendly service without full disclosure of whether their consortium is more for the benefit of their members or the public.

We welcome your input into this debate.

The FT wishes all our readers a great Canadian spring.

Adam N. Atlas

Editor in Chief

atlas@frontiertimes.ca

NEWS

Acxsys Corporation Announce New President and CEO

Toronto, February 12 07 - Interac Association and Acxsys Corporation recently announced the appointment of Mark P. O’Connell as President and CEO, effective February 7, 2007. Mr. O’Connell brings extensive experience in the payment card and banking technology industries to his new position, where he will focus on innovation in payment services and advancing Acxsys Corporation’s and Interac Association’s leadership in the industry. Most recently he was Executive Vice President, Finance Market at Emergis Inc., and for the past two years, he was Emergis Inc.’s appointee to the Interac Association Board of Directors.

As President and CEO, Mr. O’Connell will oversee the operation of Canada’s shared electronic financial services network, which provides millions of Canadians with access to their money 24 hours a day, seven days a week. He will also lead the development of new payment service opportunities and guide the introduction of Chip technology to the Canadian marketplace.

During his six years with Emergis Inc., Mr. O’Connell was responsible for significantly increasing profitability in Emergis’ Finance business and heading the global business relationship with Visa USA and Visa International. Mr. O’Connell has also held an executive position with NCR Corporation where he was responsible for Data Warehousing, Payment, and ATM solutions in the Western Hemisphere. A graduate of McGill University and the University of Windsor’s MBA program, Mr. O’Connell has also studied finance at the Harvard Business School.

Bank Supervision May Actually Drive Corruption, Says Economist

February 12 07- Traditional approaches to bank supervision may not be in the best interest of society, according to new research by a Brown University economist. In the first empirical assessment of the impact of international banking policies, Ross Levine, professor of economics, found that for most countries, regulations such as Basel II could actually hurt bank development and lead to greater corruption. Based on new data from more than 2500 firms across 37 countries, Levine and his co-researchers put forth the first practical assessment of how different banks’ supervisory policies impact the obstacles the firms face in trying to raise capital. The results are published in the Journal of Monetary Economics.

Currently, international organizations such as the Basel Committee, International Monetary Fund, and World Bank promote the development of powerful bank supervisory agencies with the authority to monitor and discipline banks. In fact, already more than 100 countries have stated intentions to implement the new Basel Capital Accord (Basel II) in the near future. Yet, according to Levine, there exists no evidence to support these recommendations, nor is there evidence on the general question of which bank supervisory policies facilitate efficient corporate finance.

After assembling the first international database on banking policies, Levine and his co-authors assessed which policies promote sound banking around the world, judged in terms of stability, bank development, efficiency, corruption in lending, and corporate governance of banks. They compared countries that choose a hands-on approach, where the government owns much of the banking industry and creates a powerful supervisory agency that directly oversees banks, to countries that rely substantially less on direct government control and put greater emphasis on forcing banks to disclose accurate information to the public.

Their results support the following two conclusions:

1. Powerful supervisory agencies with the authority to directly monitor and discipline banks do not improve bank operations; rather, powerful supervisory agencies tend to lower the integrity of bank lending.

2. Bank supervisory strategies that focus on forcing accurate information disclosure and not distorting the incentives of private creditors to monitor banks enhance the efficiency of banks and reduce corruption in lending.

Thorsten Beck and Asli Demirgüç-Kunt of World Bank collaborated with Levine on this research. World Bank funded the study.

TASQ Technology Expands into Canadian Market

Toronto, February 1 07 - TASQ Technology, a subsidiary of First Data Corp. and one of the largest providers of Point of Sale (POS) equipment and services for the credit, debit, and check markets in the U.S., has announced its expansion into the Canadian market. The expansion is a result of First Data's acquisition of Solika Solutions, Inc., a proven provider of inventory management solutions in the Canadian POS industry. Financial terms of the deal were not disclosed.

TASQ offers a full array of POS sales, services and support. This includes equipment sales, inventory management, repair, deployment, call center services, supplies and other logistics services. This Canadian acquisition will be the first TASQ deployment operation outside of the United States.

This acquisition perfectly complements First Data's existing business in Canada and will provide its clients further choice of innovative solutions. Currently, First Data provides merchant acquiring processing services and card issuing processing services from office locations in Canada.

Gift Cards New Currency of Crime

Montreal, February 10 07 - Those gift cards that countless shoppers are cashing in are also landing under the Christmas trees of organized-crime groups, who use them as "virtual currency" for drug deals and money laundering, the RCMP says.

A recent organized-crime threat assessment for Canada and the United States identified gift cards and prepaid debit cards as one of the tools in the financial-crime kit of organized crime. The assessment was compiled by the RCMP, the FBI and the U.S. Drug Enforcement Administration.

Many retailers offer gift cards in set denominations. The deposit limit on such “closed” cards makes them less attractive for organized-crime groups, Det. Insp. Sullivan said. They prefer "open" cards with higher deposit limits, such as those offered by credit-card companies, he said.

RCMP officers said such cards are now accepted as valid currency between crime syndicates. Instead of a suitcase of cash, operatives might show up for a drug deal with a fistful of gift cards. The cards are also useful for transferring money across the border, because they don't qualify as "monetary instruments" and aren't subject to reporting limits, he said. Individuals crossing the border with $10,000 or more must file a report with Canadian border authorities.

An informal search of eBay.ca found more than 2,000 gift cards on sale in Canada, many at asking prices below face value. Gift cards are an attractive option for crime groups because they can be obtained without going through the "mainstream" banking system, Det. Insp. Sullivan said.

MasterCard Canada, for example, offers a gift card that can be loaded up to $2,500. A website that promotes the card said applicants require no credit check, security deposit, employment or income verification. A person can apply for a card at various retail locations across Canada, such as convenience stores and paydayloan outlets. Once he or she completes the registration online, the card is mailed to him or her. The card can be loaded and reloaded with cash at any of the retail locations.

MasterCard Canada didn't return a call for comment.

When poorly managed, prepaid-card programs can be a "vehicle for money laundering and terrorist financing," said Gord Jamieson, director of risk management and security at Visa Canada. But he said his company has taken a number of steps to prevent its cards from being used for criminal purposes. Prepaid Visa cards available to individual applicants have a deposit limit of $500 in Canada and cannot be reloaded or used at an ATM. "We've put some pretty tight controls around this so it's not an attractive option for money laundering," he said.

Global Payments Announces Agreements with 13 U.S. and Canadian Gaming Establishments

Toronto, January 18 07 - Global Payments Inc. a leader in payment processing and gaming cash access services, today announced agreements to provide 13 U.S. and Canadian gaming establishments with its VIP LightSpeed® suite of cash access products.

Global will provide services to Greektown Casino; Treasure Island Resort & Casino; DiamondJacks Casino Resort; Riverside Casino & Resort; DiamondJacks Casino, Vicksburg, Mississippi; Fairgrounds Gaming & Raceway; Silver Slipper Gaming Hall; Golden Acorn Casino; Century Casino; Native Lights Casino; Southland Greyhound Park; Wheeling Island Racetrack & Gaming Center; and Century Casino in Edmonton, Calgary.

These establishments will utilize a number of innovative LightSpeed products including VIP Preferred @dvantage® check-cashing services, PlayerCash @dvantage® credit and debit card cash advance services, and ATM Cash @dvantage®, which permits electronic check transactions at ATMs without casino cage assistance.

VIP LightSpeed is an Internet-accessible, PC-based platform that provides cash access services for traditional and electronic check cashing, ATM check cashing, and credit and debit card cash advances. In addition, VIP LightSpeed provides high-speed processing of cash access transactions, reduces risk associated with check-cashing and cash advance services, and offers a full spectrum of management reporting tools.

NOVA Selects bay6 for Electronic Cheque Service

Atlanta, January 15 07 - Bay6, LLC today announced that it has executed an agreement with NOVA Information Systems (NOVA) to provide NOVA with a customized version of bay6’s BackOfficebay6 Enterprise Software to facilitate back-office check imaging as a component of NOVA’s Electronic Check Service (ECS) solution.

NOVA selected bay6 to develop and support the back-office image upload component of its ECS solution based on bay6’s strong background in the electronic check processing and retail point-of-sale industries.

“It was clear from our first meeting with bay6 that they understood our needs and that their solution had the features we needed,” said Amy Guiterrez, vice president, Strategic Business Development, NOVA. “Their responsiveness and commitment to our success was evident from start to finish. We recently completed a 48-store customer rollout that went extremely well, with no need for intensive onsite training.”

“Bay6 is excited to be part of a solution that allows multi-lane retailers to take advantage of the efficiencies and cost benefits of electronic check processing,” said Victoria Stenberg, executive vice president, bay6, LLC. “This relationship expands our target customer base, allowing us to reach major retailers and multi-lane chains.

Our products are extremely robust and easy to use, and incorporate data security and extensive reporting and balancing capabilities. It was a visionary product that was just waiting for back office conversion to emerge.”

By automating labor-intensive check processing tasks, bay6 products reduce the time and costs associated with check handling. Daily trips to the bank can be eliminated, since all checks can be electronically presented for payment. Because check data, including the handwritten amount, is automatically extracted, eliminating the need for data entry, employees can focus on other tasks. Data can be easily accessed for future accounting, reporting, auditing and data mining purposes.

Gemalto First to Achieve Interac Certification for Secure Banking in Canada

Toronto, January 24 07—Gemalto has announced that its personalization center outside of Toronto, Ontario, Canada is the first to achieve smart banking card certification from Interac, Canada’s debit and ABM network. Gemalto adds this to existing ISO, MasterCard and Visa certifications, demonstrating their dedication to assisting financial institutions in overcoming credit and debit card fraud. This will be achieved by converting 100 million magnetic stripe payment cards to microprocessor-based smart cards.

Having met all of Interac’s rigorous standards for security, reliability and performance, Gemalto can now provide financial institutions with chip-based banking cards for use within Interac’s Shared Services, including Interac Direct Payment (IDP), Canada’s national debit card service, and Shared Cash Dispensing (SCD), for cash withdrawals at ABMs. Interac has set final deadlines for the conversion to smart bank cards. Its Shared Services will be ready to use chip-based banking cards in 2007 and by 2015; magnetic stripe cards will no longer be accepted within the network.

Gemalto securely prepares and personalizes smart banking cards at its state of the art personalization center in Burlington, Canada. This is the only Canadian facility today capable of personalizing a full smart bank card portfolio including Native & Open Platform EMV cards, contactless and dual interface cards. The personalization process includes loading appropriate cardholder data, and then packaging and sending the cards to banks or directly to the cardholders.

PeriPheron Technologies Receipt Printer Gets Smarter

Surrey, January 26 07 - As POS systems become more intricate, they require peripherals with additional functionality. For the new RM2500 PeriPheron Technologies has redesigned the circuit board and added a more powerful processor to accommodate Windows drivers, RLE graphics and USB or Bluetooth connectivity, in addition to an RS232 port. All while retaining the RM2000s most popular features, such as the huge paper roll (395 Feet), the highly reliable print mechanism (17.36 Miles) and plug-and-play P250 compatibility.

The thermal line printer is rugged, reliable and operates at a speed of approximately

12.5 lines per second. Other features include:

• 256 kilobytes of RAM

• 128 kilobytes of nonvolatile flash memory

• Windows Drivers

• Run-Length encoded graphics enabling downloadable custom logos

The unit also supports signature capture and Chinese or Cyrillic characters. Weighing just under two pounds, its proven reliability, great speed, and its huge paper roll combined with exciting new features makes the RM2500 the most cost effective and flexible receipt printer on the market.

Traf-Sys and Precidia Team for Enhanced People Counting Data in Stores

Ottawa, January 30 07 - Precidia Technologies Inc., a global leader in the design and manufacture of Internet Protocol (IP) access devices, announced today that it has teamed with Traf-Sys Inc, a leading provider of People Counting Systems for large retail chains, malls and other establishments. Deployed in hundreds of retail locations, the iPocket232 works with the Traf-Sys people counting system to transport accurate, up to the minute pedestrian traffic data to merchants, helping them manage shopper traffic in the context of store operations.

The iPocket232, which features RS232 and Ethernet ports, connects to a Traf-Sys MIU controller, transporting the serial data collected by the controller over the customer’s IP network to a Traf-Sys server, where the data can be processed by Traf-Sys software. The iPocket232 offers a simply installed, seamless link between the controller and the software, delivering accurate, up to the minute data to business operators.

TNS Smart Network Inc. Renews PCI DSS Compliance

Toronto, January 24 07 - TNS Smart Network Inc (TNS), Canada's largest privately owned transaction processor, is pleased to announce that it has renewed its yearly compliance with the Payment Card Industry (PCI) Data Security Standard (DSS). In conjunction with its PCI audit, TNS successfully renewed its compliance in Canada and the United States under Visa's Cardholder Information Security Program (CISP) and MasterCard's Site Data Protection Program (SDP).

To achieve compliance with Visa USA, Visa Canada, MasterCard®, and all other required parties, TNS undergoes the most stringent service provider assessment category, being the Level 1 Service Provider category reserved for Payment Card processors and gateways. TNS must successfully undergo a yearly renewal in order to continue to provide its ISO partners with the opportunity to service international visitors using their Visa PLUS cards through its ATM network.

Canadians Among Fraud Victims After Winners Breach

Canada, February 5 07 - Thousands of Canadian credit card holders are victims of fraud after the security breach at the parent company of Winners and HomeSense, according to a report.

The Massachusetts Bankers Association confirmed Wednesday that customer information stolen from TJX Cos., the Massachusetts-based parent company of Winners and HomeSense, has been used to make fraudulent debit and credit card purchases. The purchases were made in Florida, Georgia and Louisiana, as well as in Hong Kong and Sweden, the association said.

While the association made no mention of Canada, the Globe and Mail, quoting financial sources, reported Thursday that thousands of Canadians are indeed among the fraud victims. Last week, TJX said hackers stole customer information from its computer systems.

The company has refused to say how many customers had their data stolen or accessed by a computer hacker, but the Globe and Mail reported it could be two million Visa credit card accounts in Canada and roughly 20 million worldwide. The company is considering offering free credit card monitoring to customers whose cards have been exposed. A customer alert notification remains on the company's website - including the Winners and HomeSense sites in Canada - advising people to find out whether they have been victims of fraud.

THE ROYAL CANADIAN MINT TO COMMEMORATE THE VANCOUVER 2010 OLYMPIC AND PARALYMPICS WINTER GAMES

Ontario, January 26 07 - With pride and excitement, the Royal Canadian Mint (RCM) today unveiled its three year program of circulation and collector coins in honor of the Vancouver 2010 Olympic and Paralympics Winter Games. The Canadian coin program is the most extensive circulation program in relation to the Olympic and Paralympics Games ever conceived by any mint worldwide. As an Official Supporter of the 2010 Winter Games the RCM will also produce the athlete medals for the 2010 Olympic and Paralympics Winter Games.

Over the next three years, the Royal Canadian Mint will put into circulation 17 coins featuring designs related to the 2010 Winter Games. Canadians from coast to coast can share in the pride and touch the Games by collecting and saving these special Canadian coins. Up to 350 million coins will go into circulation over the next three years. RBC will be the exclusive distributor of the Lucky Loonie coins.

The RCM is joining forces with RBC and Petro-Canada to provide quick and easy access to the coins as they are released. 1,200 RBC participating locations and participating Petro-Canada outlets will distribute and promote the circulation coins over the next three years. Canadians can also look for these special coins in their change. Coins will be released into circulation at selected intervals. In 2007, the RCM will release five 25-cent circulation coins.

FEATURE

CanaFunding Offers Canadian Merchants Access to Working Capital

As a business owner myself, I am aware of how difficult it can be for a business to get traditional financing. In fact, 90 percent of small business bank loan applications are rejected, often leaving merchants with few options to expand and develop their business. CanaFunding offers a new and exciting alternative to the traditional small business loan.

CanaFunding (www.canafunding.com) is a leading provider of working capital to Canadian businesses. The money isn’t a loan and CanaFunding isn’t a bank. The product—a merchant cash advance—is a non-traditional solution for merchants to get quick and easy access to working capital up to $175,000 per location.

Here’s how it works: CanaFunding buys a merchant’s future credit card sales at a discount. The company advances the merchant money for the right to buy back a percentage of their future credit card sales. Other features include a 90% approval rate for qualified applicants, fast approvals, (sometimes within 24 hours) and funds provided usually within 5-7 business days. There are no application or closing fees.

The best feature is that, unlike a bank, there is no fixed payment schedule. We get paid as you get paid. Although there is an underwriting process, CanaFunding has less stringent requirements than traditional banks. You must be processing for at least 60 days (most banks want to see 2-3 years of operation) and you can’t have any open bankruptcies. Banks require a credit score of 620 to 650 but, with our product, you’ll probably qualify if yours is 500 or above. You also must have at least 12 months on your lease.

Sometimes a merchant won’t be able to make the immediate association as to what additional money can do for the business. In that case, we suggest making a visual business plan; for instance, how much additional revenue would be generated by adding 15 tables to your restaurant? What would spending $30K for a full-fledged advertising campaign generate? What kind of income stream would an additional location bring?

Or maybe you need to buy out a partner. Whatever your vision, it is always less costly to trust your instincts than to ultimately walk away from potentially greater profits.

For more information, please visit www.canafunding.com.

By David Goldin, President and CEO, CanaFunding

DAVID GOLDIN

PRESIDENT AND CEO, CANAFUNDING

A savvy businessman with an entrepreneurial bent, David Goldin was just out of school when he started and sold his first company to a multi-billion dollar corporation.

When he was 23-years-old he co-founded Media Connection of New York, Inc. (MCNY), an Internet development company. He was instrumental in building MCNY from a 4-person start-up to one of the leading development firms in the Northeast, servicing such clients as IBM, NBC, Lycos, Reader’s Digest, The Equitable, Domino Sugar, Pricewaterhouse Coopers and Nautica.

Three years later, he sold that company to then-publicly-traded, now defunct, Winstar Communications.

“The fact that the Internet and I exploded at the same time is one of the best coincidences of my life,” he said, “The Internet was a turning point for business in this country and is one of the most powerful mediums that has ever existed. It’s targeted and focused which is exactly how I am in business. I learned how to use it to turn a company into real profit.”

But the Internet also provided another turning point--this time a hard lesson--which ultimately gave Goldin the confidence to overcome even the most difficult challenges.

“I learned not to put all my eggs in one basket,” he said. “I did that with Winstar, almost lost everything and then had to start all over again.”

“A company has substance when there is real revenue and profit, not just numbers on paper.” He cites the Dot.Com boom, and subsequent crash, with its overstated, overly optimistic projections as an example. “Hype only lasts so long,” he says. Goldin isn’t much for dispensing advice…“It’s only valuable if it’s asked for, and there are far too many unsolicited opinions”… but he does say “You must have drive. A lot of people look for the easy answers, but there are none.

In some ways, it might have been an advantage for me that I never worked for another company—and, therefore, never had the security of receiving a regular paycheck. It can be a great motivator to have your back against the wall.”

But there is one piece of advice he always gives: “If spending $X will generate $Y profit, it’s well worth the investment. Don’t be reckless, but you do need to spend money to make money.”