If you have recently had a baby, have children at home or simply in between jobs, you may have thought about starting a home based job. Even if you have a stable career in the workforce, many moms fantasise about the idea of being able to work from home.Reasons for wanting to start a home business for moms vary considerably, from wanting to be able to raise their own young children before they start school, to wanting to earn a passive income to help pay for some expenses or even because they just want to have flexible hours and be their own boss.All of the above reasons are common and very understandable. Where moms feel unsure about starting a home based business is finding an idea that agrees with them, their knowledge, market and resources available.Some moms feel that they are just an everyday mom that cannot come up with an idea that is achievable. This attitude must stop right here.I can tell you now, there is a home business idea very achievable for all people, even the most everyday mom! I believe that if you have some knowledge about something (or anything in particular) and own a computer with internet access, you can have a home business up and running within a matter of days.Put simply, billions of people search for information and content through search engines on the internet every single day. There are lots of different ways you can use information or knowledge you possess to create a income online. People will pay money online to acquire information you can provide.Creating a simple content rich website on a particular topic (niche) which also sells ebooks, has affiliate links and different advertising can create an ongoing, passive stream of income to your designated account, twenty four hours a day, seven days a week.For example, if you are a great babysitter and obviously know a lot about children, you could create a website which provides customers and visitors with lots of interesting and fun activities for toddlers. Write an eBook to sell, or purchase one with resell rights and keep one hundred percent of the profits.Your babysitting website could target an audience of parents and fellow babysitters looking for child care ideas and tips.You simply need to think about your interests and skills (in any area at all, be it horse riding, craft, cooking, massaging or juggling) and share your expertise online.You may be surprised just how many people are looking for what you can offer.There are lots of online internet marketing strategies available to help you get a home business idea started online.If you are a mom who has an interest in the baby and child niche, visit the link below which provides lots of free information and resources to get your business online the easiest and most effective way.

The opportunity to start your very own home based business is on the rise around the world. Many people are realizing the huge benefits of leaving their regular jobs and starting their own business from home. Ordinary people are making extraordinary money working from home on the Internet.If you would like to join this rapidly growing industry, you should consider a few things before getting started. First, consider how much money you are willing to invest into your business. In other words, you must have a business plan and a budget. Next, decide what tools and resources you will need. You maybe surprised to learn that you already have many of the necessary tools and resources in your home. Finally, decide what area or niche you want to target. For example, make a list of all the things you enjoy doing and build your business around the one topic you love the most.These are just a few of the things you should consider before taking the leap into the home business industry. Now, let us discuss each of these areas in a little more detail. When starting a home business, you must ensure that you have a solid business plan with the necessary budget to get your business off the ground.It is important that you have the funds available to run your new home based business without tapping into your personal savings. The key is to have at least three months of savings reserved for your personal needs. Having the necessary cash on hand will give your business time to start generating income for you.Understanding the basic tools and resources needed for your business is also very important. Necessities such as domain names, web hosting and advertising among many others are vital to the success of your business. A large number of businesses fail within the first year due to a lack of planning, funding and budgeting.Using tools and resources you already have on hand is a great way to save money as well. Most people already have a computer with Internet connection and a phone line available for use. These tools will allow you to start researching, planning and building your business straight away.After getting your budget and resources together, the next area you should focus on is finding a niche that you enjoy. Enjoying your work will allow you to put in the type of effort and commitment it takes to be successful. The goal is to choose a home business niche or idea that you truly enjoy. This will keep you motivated, happy and willing to work when you sit down at your computer. Working from home can be boring, lonely and tiring at times, so it is important to enjoy what you do for the long haul.Once you are satisfied with your business plan, you will be able to make your best home based business choice. Taking the time to plan will help you get your business off to a great start while giving you every opportunity to succeed.

When I decided to get started on my home based career I jumped into my home based business blind and with both feet. Feeling invincible I pulled out my credit card and began spending money on whatever sounded good and guess what? They all sounded good! Every one of those “push button, you’re gonna make a fortune” programs or software that do not tell you everything before you spend your hard earned money on, all sounded good. These will eventually beat you down as they did me.OK. $37, $47 or even $99 does not seem like a lot when you’re looking at thousands and thousands of dollars a month in returns, right? Let me assure you that it doesn’t end there. If you’re not being tempted into spending more money on upsales I’m pretty sure you will get completely overwhelmed and let me tell you why. You are not ready for these type of systems yet! You need an online marketing plan and goals in place first followed by a rock solid system that teaches you the how’s, where’s and when’s. It took me a year of no direction, thousands of dollars and more frustrated moments than I care to remember.First of all, if you believe that you will make it rich very quickly in this home based business industry; give up now and save your money. Any business takes time and effort. Actually, if you have never owned your own business it takes more than you realize. As I said before, goals and planning a home based business is crucial to your online success and then succeed you can.My turning point happened after I stumbled upon a good program (which is pretty rare). This program with it’s easy to follow tutorial videos set me on the right path to online success in my home based business. I went from there to create my goals and plans and I’m glad I did as these are now the cornerstones of my home based business.Enough about me and on to you, you may be thinking to yourself, “wow, where do I start with a plan”. With a little guidance and a few answered questions you will be on your way. Let’s start with some simple questions:1. Do you have any skills?2. What are your interests?3. What do you enjoy doing?The reason for these questions are to start you off in the right area for your future home based business. For example, let’s say you are an ex dancer, ex-soldier or even a duct tape artist, you have skills and those skills can be profited from. I want you to think about this. I used to believe I knew what would sell. Everyone must like what I like right? Wrong. After doing some research I was godsmacked at what people where buying. The saying had never been more correct “one man’s trash is another man’s treasure.” Keep that in mind when you start doubting your product or services.Enjoying and having an interest in your home based business is a must! I have worked with aspiring entrepreneurs in the past that looked at where they thought the most money was and after getting bored and starting from scratch with their education, they bombed. So, the point to this is that having previous knowledge, having an interest and enjoying your daily work is imperative because believe me when I say that you have a huge learning curve ahead of you.When I first looked at my plan for success I began getting very detailed which was a mistake. Everything you do right now will change. So, when writing your goals start at say, 6 months and work your way back to weekly goals, be very realistic and keep it brief. I guarantee that if you start getting detailed and waste a bunch of time you will look back and want to kick yourself as your goals will change with experience and knowledge. The same goes for the plan. However, you will need to follow your initial plan.Ask yourself, “Do I really want to pursue this interest? Do I enjoy this field and do I see myself as being a future expert?” If the answer is yes, get started in Word or Openoffice.org writing anything and everything you can about what you know, then start looking at your competitions websites and blogs, read their content, find out how knowledgeable they are and be sure to write whatever you wrote in Google, Bing, yahoo etc… to find your competition and finally DO NOT copy and paste your competitions content into yours. I will tell you why in the next article.In the next article I will talk to you about getting your message out there, how the content should be written and where to place that content for free for maximum exposure.I am currently working on the Home Based Business, Tips for Success II and will be available to you very soon.

With all due respect for Thomas A. Edison, Nikola Tesla was an equal, if not greater, American inventor. Edison is highly lauded. Tesla is nearly forgotten.

Broadly speaking, Edison could be described as an innovator. He improved on existing technology. He did not invent the incandescent light bulb, for example.

That was patented and demonstrated publicly by Joseph Swam of Britain in 1878 — a year before Edison. Later, Swam and Edison formed a brief partnership and Edison bought him out.

Tesla, a native of Serbia, also began as an innovator. He wanted to be an electrical engineer. At that time, “direct current” electricity was produced by chemical batteries charged by a steam-driven generator.

Direct current is affected by resistance in the wire conducting it. Within a mile or so, electricity is used up in the form of heat. At the University of Prague, Tesla was challenged to solve the distribution problem.

Tesla had a phenomenal memory. He memorized the complete works of Goethe and Voltaire. While strolling in a park, reciting poetry about the sun, Tesla suddenly perceived the direct-current solution.

An electric current that alternated from negative to positive could be sent in separate wires. At the receiving end, the two currents would be “induced” to flow to separate magnets — one stationary, the other rotating like the sun.

Tesla patented his idea. “Alternating current” and “induction motors” is the principal system we use today for our homes and factories.

Upon graduation in 1882, Tesla worked for the Continental Edison Company in Paris. He came to the United States a year later to work directly with Edison. Upon arrival he had four cents in his pocket and a sheaf of his poems.

Edison held several patents on direct current improvements, which he leased to General Electric. His installation of a complete direct- current lighting systems at lower New York City was widely hailed.

Inevitably the two men quarreled over the merits of their two systems. Tesla quit, opened his own laboratory and became a naturalized citizen in 1891. He sold his alternating current patents to George Westinghouse. A battle of titans ensued.

Edison tried to convince the public that the low-voltage Edison-General Electric system could be handled with complete safety, while the Tesla-Westinghouse high-voltage system was dangerous.

Someone in the Edison camp toured state fairs mildly shocking stray cats and dogs with direct current – then killing them with alternating current. The pitch was that the Tesla/Westinghouse high-voltage alternating current was fatal if touched accidentally.

First Human Electrocution

During this public relations war, the state of New York bungled several gruesome hangings. Condemned prisoners sometimes were slowly strangled or decapitated.

A Dr. Brown, dentist and spokesman for the Medico-Legal Society of New York, searched for a “more humane and scientific way” of applying capital punishment.

He convinced state authorities that alternating-current electricity was the quickest and surest.

The warden of the Albany Penitentiary asked Westinghouse to install an AC generator with which to execute an axe murder named William Kemmler.

Both Westinghouse and Tesla were strenuously opposed to capital punishment and refused.

Through subterfuge, someone – Historian Theo Benson says it was Edison – obtained a Tesla generator for the world’s first human execution by electricity.

The voltage was too low. Kemmler was literally cooked after repeated jolts of current. The disgusted Westinghouse later said, “They’d have done better with an axe.”

For years thereafter, people killed accidentally by electrical mishaps were said to have been “Westinghoused.”

Tesla System Wins

Westinghouse and Tesla forged ahead of General Electric and Edison by winning a contract to illuminate the 1893 Chicago Exposition with 200,000 light bulbs. It was a sensation.

Three years later they installed the first hydroelectric alternating – current system at Niagara Falls for the city of Buffalo. Edison and General Electric thereafter manufactured light bulbs and other appliances compatible with alternating current.

With royalties pouring in, Tesla could concentrate on the nature of electricity and its potential.

His approach of exploring the nature of energy was science – as contrasted to inventing things for specific purposes. During the next few years, he filed 830 patents.

Tesla’s watershed invention was a particular coil of wire that ushered in hundreds of uses we take for granted today. They were however, too futuristic for the time.

He achieved illumination with “filamentless” bulbs filled with various gases. Today we recognize these as fluorescent lights and neon advertising letters.

He experimented with “shadowgraphs” of human bones through clothing years before Roentgen published his work.

His “Tesla coil” created high-voltage “energy waves” by which he projected radio signals to “telautomaton” model ships. They maneuvered in response to levers on a control box.

Tesla said he could replace the lever box with a telephone to transmit voices, music – and, ultimately, images. No commercial backer was interested because there were no instruments to receive ethereal waves.

This was two years before Marconi succeeded in broadcasting a single telegraph click. After a legal suit, Tesla’s primacy was upheld.

The Navy was mildly interested in a tiny submarine without a crew that could be controlled by Tesla’s waves. However, the admirals did not foresee the smart bombs and torpedoes of today.

The ‘high-power oscillator” – that Tesla invented to control ships at sea — is the power supply for our television cathode-ray picture tube.
Man-made Lightning

The U.S. War Department in 1893 asked Tesla to expand his wireless communications systems. The request came at an awkward time. Tesla’s patents expired. His New York laboratory and papers had burned.

The manager of the Colorado Springs municipal lighting system offered Tesla free electricity for his project. He moved to Colorado Springs and built an experimental radio station 10 miles out of town.

He determined that the Earth is a huge magnet with energy flowing between positive and negative poles. Also, he computed the frequency necessary to project an electrical spurt completely through the planet and recapture the spurt when it bounced back.

It was his intent – by a huge Tesla coil — to add additional spurts to successive bounces. When a massive voltage had been built up, he would release it from a tall antenna to zoom around the world.

When all was ready, Tesla, wearing shoes with two-inch-thick rubber soles for insulation, threw the switch for one second “to see what it would do.” The plateau was carpeted momentarily with blue St Elmo Fire — but no explosion.

Tesla threw the switch again and stepped outside to measure the expected lightning bolt. Amidst deafening thunder, a bolt leaped from the antenna and lengthened as earth charges accumulated.

Folks in town were alarmed. Sparks crackled from fire hydrants. People in leather shoes, or barefoot, skipped from heat.

At 130 feet, the bolt collapsed. All was silent.

Tesla ran to the phone and called the Colorado Springs municipal electric plant. “You have ruined my experiment?”

“To Hell with you,” was the reply. “You have burned out our generators.” They sent him a bill for damages and electricity. .

Nevertheless, Tesla had learned a great deal about earth resonance and aerial propagation of radio waves. He became obsessed with the possibility of capturing earth energy and broadcasting it free to the whole world.
Search For Free Energy

Tesla returned to New York City to build a radio transmitter capable of reaching Europe. He obtained backing from J.P. Morgan, a prominent financier of promising projects.

A huge Tesla coil and 85-foot broadcasting tower was built at Wardenclyffe on Long Island. It soon became apparent to Morgan that Tesla was more interested in broadcasting free energy than commercial radio programs.

Morgan wanted to know, “Where will you put the meter?” He refused to advance any more money. Work stopped. The huge transmitting tower fell into disrepair and was finally demolished as a hazard.

The laboratory and land was acquired by the Waldorf Astoria Hotel in payment for a $20,000 room bill.

In the ensuing years Tesla experimented with a “particle beam accelerator” that could destroy invading airplanes. The newspapers dubbed it a “death ray.” Today we call it microwaves for kitchen ovens.

He invented a small “energy turbine” consisting of closely-spaced disks on an axle that spins on any gas or liquid containing energy – gasoline, hydrogen, propane, or methane – without burning the fuel.

Unfortunately the disks warp or melt from the molecular action of energy atoms. Energy and pollution problems would be solved if we could invent a suitable disk material.

Tesla postulated that sunlight could be converted directly into electricity (solar panels), energy could be extracted from atoms (bombs), hundreds of messages could be transmitted simultaneously over one circuit (fiber glass cable), drone planes could be powered by electricity (NASA has one powered by solar cells circling indefinitely at a high altitude).

During the First World War he proposed bouncing radio waves off enemy airplanes to learn of their approach. The War Department ignored his proposal. It wasn’t until World War II that RADAR was introduced.

He detected radio waves from outer space and thought they might be signals from aliens. We now know that radio waves from space are static left over from creation of the universe.

The following are some examples of modern financial management theories formulated on principles considered as ‘a set of fundamental tenets that form the basis for financial theory and decision-making in finance’ (Emery et al.1991). An attempt would be made to relate the principles behind these concepts to small businesses’ financial management.

Agency Theory
Agency theory deals with the people who own a business enterprise and all others who have interests in it, for example managers, banks, creditors, family members, and employees. The agency theory postulates that the day to day running of a business enterprise is carried out by managers as agents who have been engaged by the owners of the business as principals who are also known as shareholders. The theory is on the notion of the principle of ‘two-sided transactions’ which holds that any financial transactions involve two parties, both acting in their own best interests, but with different expectations.

Problems usually identified with agency theory may include:

i. Information asymmetry- a situation in which agents have information on the financial circumstances and prospects of the enterprise that is not known to principals (Emery et al.1991). For example ‘The Business Roundtable’ emphasised that in planning communications with shareholders and investors, companies should consider never misleading or misinforming stockholders about the corporation’s operations or financial condition. In spite of this principle, there was lack of transparency from Enron’s management leading to its collapse;

ii. Moral hazard-a situation in which agents deliberately take advantage of information asymmetry to redistribute wealth to themselves in an unseen manner which is ultimately to the detriment of principals. A case in point is the failure of the Board of directors of Enron’s compensation committee to ask any question about the award of salaries, perks, annuities, life insurance and rewards to the executive members at a critical point in the life of Enron; with one executive on record to have received a share of ownership of a corporate jet as a reward and also a loan of $77m to the CEO even though the Sarbanes-Oxley Act in the US bans loans by companies to their executives; and

iii. Adverse selection-this concerns a situation in which agents misrepresent the skills or abilities they bring to an enterprise. As a result of that the principal’s wealth is not maximised (Emery et al.1991).

In response to the inherent risk posed by agents’ quest to make the most of their interests to the disadvantage of principals (i.e. all stakeholders), each stakeholder tries to increase the reward expected in return for participation in the enterprise. Creditors may increase the interest rates they get from the enterprise. Other responses are monitoring and bonding to improve principal’s access to reliable information and devising means to find a common ground for agents and principals respectively.

Emanating from the risks faced in agency theory, researchers on small business financial management contend that in many small enterprises the agency relationship between owners and managers may be absent because the owners are also managers; and that the predominantly nature of SMEs make the usual solutions to agency problems such as monitoring and bonding costly thereby increasing the cost of transactions between various stakeholders (Emery et al.1991).

Nevertheless, the theory provides useful knowledge into many matters in SMEs financial management and shows considerable avenues as to how SMEs financial management should be practiced and perceived. It also enables academic and practitioners to pursue strategies that could help sustain the growth of SMEs.

Signaling Theory
Signaling theory rests on the transfer and interpretation of information at hand about a business enterprise to the capital market, and the impounding of the resulting perceptions into the terms on which finance is made available to the enterprise. In other words, flows of funds between an enterprise and the capital market are dependent on the flow of information between them. (Emery et al, 1991). For example management’s decision to make an acquisition or divest; repurchase outstanding shares; as well as decisions by outsiders like for example an institutional investor deciding to withhold a certain amount of equity or debt finance. The emerging evidence on the relevance of signaling theory to small enterprise financial management is mixed. Until recently, there has been no substantial and reliable empirical evidence that signaling theory accurately represents particular situations in SME financial management, or that it adds insights that are not provided by modern theory (Emery et al.1991).

Keasey et al(1992) writes that of the ability of small enterprises to signal their value to potential investors, only the signal of the disclosure of an earnings forecast were found to be positively and significantly related to enterprise value amongst the following: percentage of equity retained by owners, the net proceeds raised by an equity issue, the choice of financial advisor to an issue (presuming that a more reputable accountant, banker or auditor may cause greater faith to be placed in the prospectus for the float), and the level of under pricing of an issue. Signaling theory is now considered to be more insightful for some aspects of small enterprise financial management than others (Emery et al 1991).

The Pecking-Order Theory or Framework (POF)
This is another financial theory, which is to be considered in relation to SMEs financial management. It is a finance theory which suggests that management prefers to finance first from retained earnings, then with debt, followed by hybrid forms of finance such as convertible loans, and last of all by using externally issued equity; with bankruptcy costs, agency costs, and information asymmetries playing little role in affecting the capital structure policy. A research study carried out by Norton (1991b) found out that 75% of the small enterprises used seemed to make financial structure decisions within a hierarchical or pecking order framework .Holmes et al. (1991) admitted that POF is consistent with small business sectors because they are owner-managed and do not want to dilute their ownership. Owner-managed businesses usually prefer retained profits because they want to maintain the control of assets and business operations.

This is not strange considering the fact that in Ghana, according to empirical evidence, SMEs funding is made up of about 86% of own equity as well as loans from family and friends(See Table 1). Losing this money is like losing one’s own reputation which is considered very serious customarily in Ghana.

Access to capital
The 1971 Bolton report on small firms outlined issues underlying the concept of ‘finance gap’ (this has two components-knowledge gap-debt is restricted due to lack of awareness of appropriate sources, advantages and disadvantages of finance; and supply gap-unavailability of funds or cost of debt to small enterprises exceeds the cost of debt for larger enterprises.) that: there are a set of difficulties which face a small company. Small companies are hit harder by taxation, face higher investigation costs for loans, are generally less well informed of sources of finance and are less able to satisfy loan requirements. Small firms have limited access to the capital and money markets and therefore suffer from chronic undercapitalization. As a result; they are likely to have excessive recourse to expensive funds which act as a brake on their economic development.

Leverage
This is the term used to describe the converse of gearing which is the proportion of total assets financed by equity and may be called equity to assets ratio. The studies under review in this section on leverage are focused on total debt as a percentage of equity or total assets. There are however, some studies on the relative proportions of different types of debt held by small and large enterprises.

Equity Funds
Equity is also known as owners’ equity, capital, or net worth.
Costand et al (1990) suggests that ‘larger firms will use greater levels of debt financing than small firms. This implies that larger firms will rely relatively less on equity financing than do smaller firms.’ According to the pecking order framework, the small enterprises have two problems when it comes to equity funding [McMahon et al. (1993, pp153)]:

1) Small enterprises usually do not have the option of issuing additional equity to the public.
2) Owner-managers are strongly averse to any dilution of their ownership interest and control. This way they are unlike the managers of large concerns who usually have only a limited degree of control and limited, if any, ownership interest, and are therefore prepared to recognise a broader range of funding options.

Financial Management in SME
With high spate of financial problems contributing to the high rate of failures in small medium enterprises, what do the literature on small business say on financial management in small businesses to combat such failures?
Osteryoung et al (1997) writes that “while financial management is a critical element of the management of a business as a whole, within this function the management of its assets is perhaps the most important. In the long term, the purchase of assets directs the course that the business will take during the life of these assets, but the business will never see the long term if it cannot plan an appropriate policy to effectively manage its working capital.” In effect the poor financial management of owner-managers or lack of financial management altogether is the main cause underlying the problems in SME financial management.

Hall and Young(1991) in a study in the UK of 3 samples of 100 small enterprises that were subject to involuntary liquidation in 1973,1978,and 1983 found out that the reasons given for failure,49.8% were of financial nature. On the perceptions of official receivers interviewed for the same small enterprises, 86.6% of the 247 reasons given were of a financial nature. The positive correlation between poor or nil financial management (including basic accounting) and business failure has well been documented in western countries according to Peacock (1985a).

It is gainsaying the fact that despite the need to manage every aspect of their small enterprises with very little internal and external support, it is often the case that owner-managers only have experience or training in some functional areas.

There is a school of thought that believes “a well-run business enterprise should be as unconscious of its finances as healthy a fit person is of his or her breathing”. It must be possible to undertake production, marketing, distribution and the like, without repeatedly causing, or being hindered by, financial pressures and strains. It does not mean, however, that financial management can be ignored by a small enterprise owner-manager; or as is often done, given to an accountant to take care of. Whether it is obvious or not to the casual observer, in prosperous small enterprises the owner-managers themselves have a firm grasp of the principles of financial management and are actively involved in applying them to their own situation.” McMahon et al. (1993).

Some researchers tried to predict small enterprise failure to mitigate the collapse of small businesses. McNamara et al (1988) developed a model to predict small enterprise failures giving the following four reasons:

- To enable management to respond quickly to changing conditions
- To train lenders in recognising the important factors involved in determining an enterprise’s likelihood of failing
- To assist lending organisations in their marketing by identifying their customer’s financial needs more effectively
- To act as a filter in the credit evaluation process.

They went on to argue that small enterprises are very different from large ones in the area of borrowing by small enterprises, lack of long-term debt finance and different taxation provisions.

For small private companies, these measures are unreliable and textbook methods for judging investment opportunities are not always useful in organisations that are privately owned to give a true and fair view of events taking place in the company.