Back at my favourite networking group this week www.3Cscommunity.com reminds me of a simple test one of the founders applies to business plans – see heading. When pulling a plan apart (which is what potential investors always do) assume sales are half what you think, assume costs are double then assume it all takes twice as long. If the idea still looks viable, then you may have a business.

Sadly, the latest Budget doesn’t stand up to much stress testing, as the figures are based on a growth rate that is nearly double what is likely to be achieved and markets are not impressed. A Budget is about as big as any business plan ever gets, and what is not said or touched says as much as what is mentioned. Public sector pensions are hardly touched although the latest cost is around £1.3 trillion (that word again). With an election only weeks away, and a real Budget before Christmas, the recent one might be as relevant as the menu on the Titanic the night before it hit an iceberg.

Interesting that there may be tax breaks for the computer games industry http://www.telegraph.co.uk/finance/financetopics/budget/7514133/Budget-2010-Gamers-celebrate-tax-breaks-for-computer-game-industry.html but no stop to more and more regulation, especially for small businesses. Interesting to see how this emerges after the election and why this industry in particular?

One of the 3Cs presenters is from www.lemonstudioslondon.com in Clerkenwell. Having worked very well as a open plan business centre, they now want to expand to 6 more sites where landlords with empty buildings would be be ideal partners and they do not have to be prime sites either. In current times, many businesses do not want to sign up for a long lease and the set-up means that the return can be up to 50 per cent more than with a conventional commercial lease.

All the tenants are in digital media and often work together. When potential partners are on the other side of the room, this saves huge amounts of time. Average tenancy is around 18 months but a few only stay 3 months. Largest tenant which employed 100 people moved out recently but occupancy rates are very high and while redecoration costs are higher than average, the model is profitable. New tenants are listed on the intranet, so you know who that new geezer is on the next row and a small touch of genius that helps people get on with each other is the free beer on Friday afternoons. Not actually an original idea, as I know of one large City law firm that has a very popular drinks trolley Friday afternoons as well.

Next 3Cs meeting 18th May 2010.

A new enquiry about pensions shows that the proposed contribution is not likely to lead to much of a pension fund but escalating the contributions at 10 per cent over 30 years, gives more than double the fund compared to a level contribution and a likely pension income of just over half current earnings, in real terms. In other words, there is still time to catch up and fairly likely that in future will be working to age 70 rather than 65.

Have to confess that the Foreign Legion is still an occasional escape from finance and Padraig O’Keefe’s book Hidden Soldier http://www.obrien.ie/book712.cfm has some interesting stuff in it. Two tours of Yugoslavia for example, are quite different. First one organised by the UN seems to achieve little and there are some unkind words about about the Dutch peacekeeping soldiers who step aside allowing a massacre of 20,000 muslims by the Serbs. Second tour organised by NATO is much more effective but the disillusionment has set in. One little known tradition of the Foreign Legion was that they never sang La Marseillaise. While they are a French light infantry unit, Frenchmen are not officially allowed to join. But the French have a practical attitude to regulations when it suits and those that do, are typically registered as Swiss, Belgian or Canadian. Accounts suggest that they are not popular with other legionnaires though.

A recurring theme in all the books about the Foreign Legion is that they seem to be the poor relation to the regular French Army where budgets and equipment are concerned. Padraig’s book suggests that this is less the case than before, but the refusal of him and his comrades to sing La Marseillaise seriously upsets the officer in charge. With only 6 weeks to go from the end of his second 5 year stint, he deserts and like many ex-legionnaires ends up in the security industry. This leads to highly paid but very dangerous work in Iraq as a mercenary, something he seems sensitive about as he still calls himself a security guard. His account of coming under attack when guarding a supply convoy is vivid where he is the only survivor apart from two people right at the rear of the convoy who kept their heads very well down.

More fun to read but just as exciting is Susan Travers Tomorrow to be Brave http://www.amazon.co.uk/Tomorrow-Brave-Memoir-French-Foreign/dp/0743200012 the only woman to have served in La Legion. Much of her life was spent in France where her teenage years were spent on the French Riviera, which she admits was probably not the best place for a young girl to grow up. All people seemed to worry about those days she says, was money and sex! As the French say, plus ça change, plus c’est la même chose and if you have a couple more minutes, enjoy http://www.telegraph.co.uk/news/obituaries/1450081/Susan-Travers.html

Twitter produces another enquiry from an IFA who wants to get the best annuity rate for his client who has leukaemia – Can I help? A 20 minute chat shows that the tax-free cash is needed to pay off expensive unsecured debt. Chemo-therapy has just started so client is still working 12 hour days 6 days a week which really worries me.

Fatigue seems to be a factor in all cancer treatments which are basically controlled poison regimes. Strategy is that the radio therapy or chemo- will knock out the cancer cells including some healthy ones, but the healthy cells will recover while the cancer ones won’t. Cancer is basically a cell growth problem where the growth renewal cycle goes awry. During treatment, your body is a battle ground so you can feel pretty awful, with the main symptom being tiredness. Good if you have some moral or practical support, as it is easy to give up. You can also get a second opinion if you are not happy with the  diagnosis.

With this client there are two main issues. Using the appropriate underwriting form will enable an IFA to shop around various insurers to get the best annuity rate plus advise on the type of annuity to buy, as there are lots of options. Trying to do this without advice is idiotic, but still people out there who think they know better. Client life expectancy here is 5-6 years so the option of taking all the fund in cash is not available. The client is concerned about losing his job and is near retirement age anyway.  But for me the 6 day weeks with long days seems the biggest health risk.   Summary here of some financial and non-financial options http://www.georgeemsden.co.uk/2010/02/gathering-time/

Looking on the bright side, the client at least doesn’t have to worry about the cost of treatment which for chemo is huge. Chemo has the advantage that it gets all around the body and can be pretty good at cleaning cancer cells out, but a small box a doctor showed me recently for a well known cancer drug cost £6,000 and the minimum is usually 6 cycles. More surprising was that using this drug prolongs the patients life by an average of 4 months. This produced a rather bemused reaction from the dinner guests when asked how many of them would spend that much to extend their lives by that period?

The NHS which employs 1.4 million people has a resource problem which could produce a number of cold hard choices i) this year’s budget finished (we can’t afford it – use you own money) ii) reduce expectation (unlikely) or maybe iii) hope that some kind of quantum improvement or automation/mass production approach will reduce the cost. (Let’s pray)

It really seems like Malthus all over again. Malthus, an ordained Church of England priest, was famous for his prediction that there will always be starvation and poor people as population increases geometrically while food for example, only increases arithmetically. As time goes on a food resource gap emerges and poorer people die sooner. http://homepage.newschool.edu/het//profiles/malthus.htm

With cancer treatment, we have unlimited expectation and limited resouces even with governments printing more money, so soon there will be a Health Gap.

Returning to the subject of computers, these were large expensive main frame beasts at the start of my working life being housed in air-conditioned rooms guarded by what seemed like high priests you sometimes dared not approach. Bill Gates vision of making them available to everybody was dismissed by the best computer brains at the time. And this was years after IBM Head Thomas Watson’s 1943 quote when he famously said that the world market for computers was about 5 machines http://ifaq.wap.org/computers/famousquotes.html

But there is a problem with any new cancer treatment. New IT software or hardware doesn’t need to be tested like new drugs and treatments. Currently,  around 2,000 drugs are being tested in the UK about 90 per cent of which won’t make it to market. Reasons for this high fall out rate include: side effects (remember Thalidomide?) http://www.enotes.com/1960-medicine-health-american-decades/thalidomide-global-tragedy ineffectiveness (they don’t work as well when tested more thoroughly) and of course, cost.

My anti-virus software gives me an interesting idea here. A report shows the spyware/malware and other nasty stuff removed in the previous week. Why not the same for us with some embedded micro bio-chip? Terminator 4 perhaps? Our immune system deals with cancer cells for example, all the time. How about a weekly look at what our white cells did over the past week? Might encourage some of us to change our lifestyle? Sadly, the doctor points out that this is still science fiction, but hopefully not for too long.

P.S. If you want to follow me on Twitter, I am cancerIFA.