New Trends

As an investor I am a swing trader. What that means is that instead of looking at fundamentals of a company (stock) I tend to look for swings in the markets. The idea being that if you can jump on a rising tide you can quickly get some upside by following upward ticks and large volume. This is nothing new and really a fairly easy way to capture a few points (percentage points) on your investable money.

In addition to thinking this way about stocks I also think like this about new ventures. My last company www.swppsystems.com was just that. I started this company when two things were rapidly emerging. The first being a huge rise in new housing starts and the second being new laws that were established around storm water. It has been a huge success. With the rapid decline of the housing markets we have also seen a decline in the willingness of municipalities to enforce the laws around storm water. So----

I am always looking for new opportunities and lately I have an interesting convergence between a few things that could prove to be fertile ground for a startup. We all have seen how hugely successful and viral social networking is---facebook with its 50M users and myspace with about half of that. This "social movement" is really a blend of utilizing the internet with its global reach and making it relevant and local to a users wants and needs. We have seen a lot of companies try to do this with content---read citysearch.

The other things that is emerging is P2P (peer2peer) platforms. Five years ago all those bit torrent sites (i.e. napster) were doing p2p stuff with content that is nothing new; but, now P2P is different. We have blended this social movement into a P2P platform that is facilitating all sorts of things---we have social lending and microphilanthropy.

Social lending sites like prosper.com and microphilanthropy sites like donorschoose.com are facilitating inter-personal connections into financial transactions. My question is how far can this go? In 2007 P2P lending was a 700M market. It is projected to be 5B in 2010. While I think 5B is very optimistic there is no doubt that it is a movement that will get larger and larger in the future-------especially as the face of typical banking is rapidly changing and banks are going out of business.

The "swing trade" question is how does one capitalize on this? The easiest thing would be to take one of the more successful business models and introduce it into a different country with a vibrant economy--maybe India or the pacific rim. The other thing would be to take a slice of P2P lending and build it out--maybe focus on real estate or microbusiness loans.

I am not sure at this point but, as with anything timing is critical and its always working against you. Will keep you updated.