Advanta Expects Lower Earnings ( Their Leasing Company is "for sale." )
         " The Company has also implemented its plan to discontinue lease originations from the unprofitable segments of the broker channel and improve the yields on new originations. In addition, the Company is actively pursuing strategic alternatives for the leasing business, including its possible divestiture" ( UAEL Conference Advanta Leasing Staff knows they are "on the block"--see archives for more---editor )
    eLease Says "Senior Management Change Only"; List Up-dated.
      Access Lease Teams with Planetary Network for "Real Time" Leasing
         Access Lease Raises $6.5 Million for Online Business
            GE Puts Loan/Lease Pricing On Line
              Scripps Financial and USBancorp being purchased/merged by Firstar
               Stocks Still Flow in Silicon Valley/Money Still Loose, newspaper reports
                 Cisco/Microsoft Pay No Federal Tax ( stocks to employees shelter their earnings )
                  The List--Up-dated

eLease Says "Senior Management Change Only."

The management team at eLease was never let go. Two senior people left the company over a 45 day period in the May/June timeframe. These departures were a natural result of eLease's expanded business model. In early 2000, eLease built a neutral marketplace, which focused on the serving lessees directly. eLease then expanded its product offering to include an end-to-end suite of hosted leasing applications. The new products offer lease process automation from origination, through underwriting, to servicing. As a result, eLease moved away from being a broker and became a technology provider. This shift was the reason behind the senior-level departures. Now, our customers for these hosted leasing applications range from the Fortune 500, to leasing companies, to ebusiness portals. We are adding people, particularly in application sales and software development.

Thanks for taking the time to make this important correction to your site.
We really appreciate it.

Daniel Andrzejek
COO
408-990-7072
daniel@eLease.com

( Advanta's Full Press Release--Note Third Paragraph for Leasing News )

Advanta Comments on QIII Earnings Estimates and Outlook for Remainder of 2000 Advanta announced that, on a preliminary basis, the Company estimates that net income for the third quarter will be approximately $8 million or approximately $0.32 per share on a diluted basis for Class A and Class B shares combined. Operating earnings per share, on a diluted basis, for the third quarter are expected to be approximately breakeven. The results for the third quarter have been impacted primarily by a slower than anticipated turnaround of the Company's leasing business, lower mortgage origination volume due to continued implementation during the quarter of processes required by the regulatory agreements, and strengthening of reserves for the Company's business credit card unit due to the maturing and growth of this portfolio. Advanta expects to release its final earnings results for the third quarter on Tuesday, October 24, 2000. Management will hold its regularly scheduled conference call with analysts and institutional investors on October 24 at 9:00 am Eastern time to discuss the quarter's results.
The Company is also revising its outlook for the remainder of the year. Because the Company is in the process of evaluating strategic alternatives for its mortgage and leasing businesses, it is not in a position to provide specific guidance for the remainder of the year at this time. The Company will update its progress on the evaluation of strategic alternatives at its October 24 conference call.

Earnings for the third quarter are expected to include approximately $23 million of provisions and charges due to continued charge-offs largely concentrated within certain unprofitable segments of the leasing business from prior periods, an increase in reserve coverage for the Company's business credit card unit, and a charge in the Company's insurance business relating to a large policy claim settled during the quarter. Excluding these items, earnings per share for the third quarter would have been in the area of $1.23 per share on a diluted basis. Similarly, operating earnings for the third quarter would have been substantially higher excluding these items.

The Company has pursued aggressive remedial initiatives in the leasing business, including the addition of experienced leadership to oversee collections. The Company has also implemented its plan to discontinue lease originations from the unprofitable segments of the broker channel and improve the yields on new originations. In addition, the Company is actively pursuing strategic alternatives for the leasing business, including its possible divestiture.
Although the Company anticipates moderate improvement in results for the fourth quarter, it expects full year operating results will be below prior guidance levels because it anticipates that the factors impacting third quarter results for the mortgage and leasing businesses will continue into the fourth quarter. In addition, the Company has received notice that one of its largest mortgage subservicing clients will move aspects of its servicing in-house and will terminate its subservicing contract with the Company effective during the fourth quarter. The Company expects to collect a termination fee, which will partially offset the financial impact of the cancellation of this contract.
The Company's conference call scheduled for October 24 will be broadcast simultaneously for the public over the Internet through http://www.advanta.com or http://www.vcall.com. To listen to the live call, please go to the web site at least fifteen minutes early to register, download, and install any necessary audio software. For those unable to listen to the live broadcast, replays will be available shortly after the call on the Vcall site.

Advanta (http://www.advanta.com) is a highly focused financial services company with over 2,700 employees, servicing over $26 billion of assets, including approximately $12.4 billion in managed assets and approximately $13.6 billion in assets serviced for third parties. Advanta provides consumers and small businesses with targeted financial products and services, including non-conforming mortgages, business credit cards, equipment leases, insurance and deposit products. The Company is also one of the largest servicers of non-conforming mortgages for third parties in the country. Advanta has leveraged its first-class direct marketing and information based expertise to develop state-of-the-art data warehousing and statistical modeling tools that identify potential customers and new target markets. Advanta created one of the first automated underwriting and sales engines in the non-conforming mortgage industry. The Company also offers its customers and business partners a broad range of self-service financial solutions and other services on the Internet.

Advanta was named one of the 500 Most Admired Companies in America in Fortune Magazine's most recent annual survey. In June 2000, American Banker ranked Advanta Bank third among the top 100 community banks in the nation in terms of return on average assets.

Planetary Chooses AccessLease for Its Private-Labeled Capital Equipment Leasing Solution, Estimating Over $50 Million in Lease Volume Over the AccessLease Network

SAN FRANCISCO--(BUSINESS WIRE)--Oct. 9, 2000--

Newest Silver Tier VAR for Cisco Equipment Chooses AccessLease's Real-Time Lease Matching and Approval for Its Small Business to Fortune 500 Customers

AccessLease, the first provider of a complete online leasing infrastructure for equipment and software providers, B2B marketplaces and financial institutions, announced that Planetary Networks, Inc., a Silver Tier Cisco Systems VAR providing LAN and WAN solutions to corporations, ISPs and CLECs, has chosen its new private-labeled end-to-end leasing solution for its small business to traditional Fortune 500 customers.

Through AccessLease's solution, Planetary ƒan provide its customers with an automated, real-time lease processing system for the first time. In addition, AccessLease's relationship with over 50 top wholesale funding sources offers Planetary's customers a broad range of A to D credit ratings and a much higher likelihood of lease approval.

"We are very excited about the opportunity to work with AccessLease and we anticipate that with Planetary's customers there will be at least $50 million of leasing opportunities annually for the company," said Dan Gravelle, vice president of finance & CFO of Planetary. "We have been offering leases to our customers through traditional, offline leasing brokers since our inception, and this is the first time we have been able to offer our customers more efficient, real-time lease processing while saving them 25%, the typical finance charge they experience in offline leasing."

"Our end-to-end online leasing solution offers Planetary's customers a significant cost savings, a wider selection of financing options and faster processing of their leases, while providing Planetary a means to offer financing to all of their customers, while decreasing the application to funding time," said Troy Klith, founder and CEO of AccessLease. "The inefficiencies in the traditional offline leasing market make our automated, streamlined online solution very attractive to companies like Planetary that have such a strong commitment to customer service."

Planetary rolled out AccessLease's intranet offering to its sales force in September, enabling its customers to immediately benefit from the broad range of funding sources and the speed of AccessLease's funding transaction process. In mid-October Planetary's sales force will receive an upgrade of AccessLease's system which includes an enhanced expert system and even further time decreases in the funding transaction process.

About AccessLease

AccessLease grew out of American Technology Funding, Inc., a traditional leasing company founded in 1997. AccessLease is privately held, with headquarters in San Francisco. The founders recognized the inefficiencies present in the unregulated equipment leasing industry where: 1) equipment and software providers and B2B marketplaces demanded point-of-sale financing solutions and wanted a broad credit offering for their customers; 2) funding sources incurred high transaction costs, while only providing leases to 20% of the applicants, and 3) business customers found it difficult to obtain market rate information, struggled with cumbersome, paper-intensive processes and were typically paying up to a 25% markup charge for leasing. The resulting solution is the AccessLease solution -- a complete private-labeled leasing infrastructure targeted at equipment and software providers, B2B marketplaces and financial institutions.

About the AccessLease End-to-End Leasing Solution

AccessLease provides an outsourced end-to-end private label leasing solution designed for equipment and software providers, B2B marketplaces and financial institutions that want to add a branded point-of-sale financing option for their customers. AccessLease enables equipment and software providers, B2B marketplaces and financial institutions to give their customers instant access to the industry's best equipment leasing products and lowest rates from the nation's top funding sources. In addition, the business customers benefit from a simple, fast process and online account management.

The AccessLease Solution enables partners to provide lease financing at the point-of-sale from within a multi-funding source network. AccessLease has partnerships with 50 of the top lease finance companies and banks in the U.S. With the cooperation of its funding partners, AccessLease is the first and only company to develop proprietary technology that enables end-to-end automation of the lease finance process. AccessLease's private-labeled leasing solution includes: real-time credit scoring and decision making, risk-adjusted pricing utilizing its national network of funding sources, sophisticated lease analysis tools, automated documentation-generation and online status reporting.

About Planetary Networks, Inc.

Planetary Networks, Inc., (www.justcisco.com) is a Silver Tier Cisco Systems VAR (Value Added Reseller), providing sound and scalable Local Area Network (LAN) and Wide Area Network (WAN) solutions to Corporations, Internet Service Providers and Competitive Local Exchange Carriers. Through a strong focus on customer satisfaction and the technical training of its staff, Planetary Networks provides a high level of expertise in several areas. The company's core competencies include network design and integration, network security, network management and project management. Silver Tier certification status provides strong recognition of Planetary's continuous investment in Cisco System's training and technology, and commitment to providing leading internetworking technology to our customers. This commitment mirrors the efforts undertaken by Cisco, to sell the network as a strategic business asset and to attain the highest level of customer satisfaction achievable.

CONTACT:
AccessLease
Joseph Loll, 415/946-6300
joel@accesslease.com

or

Price Public Relations, Inc.
Tamsen Reinheimer, 650/829-5800
treinheimer@pricepr.com

AccessLease Raises $6.5 Million In First Round Of Financing

AccessLease, the first provider of a complete online leasing infrastructure for equipment and software providers, B2B marketplaces and financial institutions, announced the completion of its first round of funding in the amount of $6.5 million.

Athena Technology Ventures, the lead investor in the round, was joined by other investors including Sterling Payot Capital, Artemis Ventures, Leslie Murdock of Murdock and Associates, and an investment partnership affiliated with the law firm Wilson, Sonsini, Goodrich and Rosatti. The funding will be used for general working capital and specifically for technology development and aggressive business development and marketing efforts.

AccessLease provides an outsourced end-to-end private-labeled leasing solution designed for equipment and software providers, and B2B marketplaces that want to add a branded point-of-sale financing option for all of their customers. AccessLease enables equipment and software providers, and B2B mar ketplaces to give their customers instant access to the industry's best equipment leasing products and lowest rates from the nation's top funding sources. In addition, the business customers benefit from a simple, fast process and online account management.

"We saw from our years of experience as an intermediary in the capital equipment leasing market how the Internet provided the means to solve the traditionally painful and resource-intensive process of originating, processing and syndicating leases," said Troy Klith, founder and CEO of AccessLease.
"With our complete private-labeled leasing solution, our partners can cut their lease transaction time from the traditional two to four weeks to minutes. We are pleased our vision has attracted such strong venture partners."

"The AccessLease team has a unique combination of deep domain experience and technology expertise that has allowed them to rapidly build an unparalleled funding network, and to leverage this network in the development of the first true real-time, end-to-end leasing solution," said Steve Lee, direc tor of Athena Technology Ventures. "We look forward to working with the team at AccessLease to help them realize their opportunity in the $233 billion market for capital equipment leasing."

The AccessLease Solution enables partners to provide lease financing at the point-of-sale from a large network of funding sources. For example, equipment and software providers and B2B marketplaces can integrate the lease financing solution into their "shopping cart" to offer their customers (less ees) automated, cost-effective real-time leasing. Equipment manufacturers or software providers can also use the AccessLease solution for corporate sales forces to directly manage and facilitate leasing transactions for their customers. AccessLease has partnerships with 50 of the top funding sourc es in the U.S. With the cooperation of its funding partners, AccessLease is the first and only company to develop proprietary technology that enables end-to-end automation of the lease finance process. AccessLease's private-labeled leasing solution includes: real-time credit scoring and decision making, risk-adjusted pricing utilizing its national network of funding sources, sophisticated lease analysis tools, automated documentation-generation and online status reporting.

Based in Palo Alto, CA, Athena Technology Ventures makes investments in early stage companies in the global communications industry. Athena's portfolio includes companies focusing on semiconductors, network systems, telecom services, Internet infrastructure and infraservices, and e-commerce. The principals and support staff bring a broad array of technical, financial, and operational experience to making each investment decision, and supporting each portfolio company. Athena's main investors are corporate partners from Asia, and market leaders in semiconductor manufacturing, network systems, consumer electronics, telecom, and Internet.

Sterling Payot Capital focuses its investment and strategic advisory activities on the emerging Telecom and Internet landscapes. Sterling Payot has invested in more than 25 early-stage companies, including Accrue Software, Packeteer, Wired Ventures, Wit Capital, Yahoo MarketPlace, LivePerson, Dialpad.com, Rapid Logic and Capstan Systems. In an advisory role, Sterling Payot Company has completed several significant projects for established companies including Pacific Telesis/AirTouch, Metricom and Visa International.

Based in Sausalito, CA, Artemis invests in business-to-business, seed-stage high-tech start-ups offering Internet software and services, including e-commerce, ASPs, Internet and wireless infrastructure companies. Artemis focuses on companies specializing in pragmatic uses of the Internet, preferring to work with practical companies with realistic solutions to today's business problems. Christine Comaford, managing director and general partner of Artemis, has founded five successful startups, advised the industry's foremost software companies and Fortune 1000 firms, secured over $100 million in financing, participated on several boards of for- and non-profit companies, and consulted with President Bill Clinton, Vice President Gore and First Lady Hillary Rodham Clinton.

Leslie Murdock, president and CEO, established M&A in January 1989 after 10 years in the Silicon Valley and Dublin offices of Ernst & Young and five years with Buckley Delaney in Dublin. His areas of expertise include representing emerging growth companies in corporate finance, accounting and administrative issues. He has advised both privately held and public companies in the high-tech sector including AtWeb (acquired by AOL), Four11 (acquired by Yahoo!), Improvenet, Pensare, Rambus, Excite (merged with @Home) and Bizfinity. M&A provides corporate accounting, finance and information systems services to emerging and established technology companies. Positioned to complement the core services provided by the Big Five Accounting Firms, M&A offers a way to respond to the internal demands created by rapid growth and expansion. M&A currently serves more than 200 clients in the Silicon Valley and the San Francisco area, including 3com, Applied Materials, Blue Martini Software, Cadence Design, Chemdex, Cisco, eBay, Excite@Home, Hewlett Packard, Quantum, Rambus, Silicon Graphics, Spinner.com and Sun Microsystems.

Wilson Sonsini Goodrich & Rosati (WSGR) is the leading law firm representing technology companies at all stages of their growth, as well as the investment banks and venture capital firms that finance them. Over the past four decades, the firm has established its reputation by having an unmatched knowledge of its clients' industries, as well as deep and long-standing contacts throughout the technology sector. WSGR distinguishes itself by taking the time to understand its clients' business needs and by providing a full range of legal services designed to scale with their growth. The firm is equipped and experienced in helping to start entrepreneurial ventures, successfully take them through their Initial Public Offerings and follow-on financings, and then counsel them on a myriad of business issues -- including taxation, intellectual property, mergers and acquisitions, and litigation.

GE Small Business Solutions Enhances Offerings and Resources Available to Small Businesses Via the Web

GE Small Business Solutions (GESBS) announced that it has expanded its offerings of insurance products on its Web site, www.GEsmallbusiness.com. The enhanced product offering is in response to an increased demand by small business owners to offer their employees improved benefits in a manner which is both convenient and cost-effective.
While small businesses' use of the Internet has doubled in the past year, many products and services targeted to this explosive market, such as employee benefits, have not effectively been offered on the Web. GESBS goes above and beyond other benefit offerings on the Web by extending expert consulting services in addition to its suite of financial and benefit offerings for small businesses on its Web site. GESBS will offer medical benefits as well as stop loss insurance, which manages risk for employers who choose to self-fund their medical plan. GESBS also offers dental, short-term and long-term disability and life insurance, giving small businesses access to a complete employee benefit portfolio, as well as various financing solutions through its Web site.
"Our customers indicated to us that the ability to offer a comprehensive, competitive benefits package to their employees is a top priority as they look to attract and retain talent," said Jeff Kiesel, president of GE Small Business Solutions. "We have fulfilled this need by offering new benefit products over the Web, enabling our customers to access this information at their own pace and convenience."
In addition to adding Medical and Stop Loss insurance to the site, small business owners will now have the opportunity to work directly with a certified Benefit Consultant who can walk them through their benefit options and help them create a benefit package that is right for them and their employees. GESBS will also offer risk management advice and help employers develop employee benefit programs that meet a company's risk management goals and fit the risk make-up of their employee group. Additionally, GESBS' benefit consultants will work with employers' brokers or producers in designing the right benefits program.
"New product offerings are just the beginning of our enhanced services," continued Kiesel. "Our knowledgeable consultants offer individual attention to our customers, guiding them through the process and helping them find the right benefits package that not only meets their needs, but also the needs of their employees."
Other recent enhancements to the GESBS Web site include: A "Pocket Analyzer," which allows a visitor to pre-qualify for an SBA loan, estimate their monthly payment and determine a probability of approval;
A GE Fleet Consultant report, which details how much the visitor can save by utilizing GESBS' vehicle management services;
An online pricing tool, which estimates the visitor's monthly payment on an equipment lease and enables them to apply for the lease online;
A Financial Product Selector, which can recommend a product solution when the visitor answers a few questions about their business.
GE Small Business Solutions, a new initiative from GE Capital, was launched in February 2000 and offers equipment financing, corporate credit cards, employee benefit programs and fleet financing and management to small businesses with up to $20 million in revenues.
GESBS provides the financial resources, e-commerce expertise and industry know-how to help small businesses grow in today's fast-paced economy.
GESBS' Web site, www.GEsmallbusiness.com, offers small businesses financial solutions via the Internet, including equipment loans and leases, vehicle leases, SBA loans, corporate credit cards, benefits programs, personal computers and technology solutions. In addition to the web site, small business leaders can also access GESBS through its customer service number (888)335-GESB (4372).

Scripps Financial Corporation Discusses the Impact of the U.S. Bancorp And Firstar Corporation Transaction

SAN DIEGO, Oct. 9 /PRNewswire/ -- San Diego headquartered Scripps Financial Corporation (Amex: SLJ) has noted the public announcement of the intention of Firstar Corporation (NYSE: FSR) to merge with U.S. Bancorp (NYSE: USB) at an exchange ratio of 1.265 shares of Firstar Corporation for each shar e of U.S. Bancorp. Since the exchange ratio for the acquisition of Scripps Financial Corporation by U.S. Bancorp had been set at 1.067 shares of U.S.
Bancorp for each share of Scripps Financial Corporation, the additional premium for Scripps Financial Corporation shareholders reinforces the opini ons of the Scripps Financial Corporation Board that its transaction with U.S. Bancorp is in the best interest of Scripps Financial Corporation shareholders. As of October 6, 2000, Scripps Financial Corporation has received proxies representing 65.0% of its outstanding shares voting in favor of the Scripps Financial Corporation/U.S. Bancorp merger. The announcement of the merger of U.S. Bancorp and Firstar Corporation will not change the Scripps Financial Corporation shareholder meeting date of October 13, 2000. Scripps Financial Corporation and U.S. Bancorp currently expect their transaction to close on or shortly after October 13, 2000. Scripps Financial Corporation also observed that Firstar Corporation and U.S. Bancorp have noted that their transaction is subject to shareholder and regulatory approval and is not expected to close until the first quarter of 2001.

San Diego headquartered Scripps Financial Corporation is the parent company of Scripps Bank. Specializing in relationship banking, Scripps Bank offers a Private Banking atmosphere and a tradition of quality service for businesses, professionals and individuals throughout San Diego County. The Co mpany maintains full service regional banking offices in La Jolla, El Cajon, Downtown San Diego, Escondido, Kearny Mesa, Encinitas, Point Loma and Chula Vista. Scripps Bank also delivers specialized Trust, Investment, Corporate Lending, SBA Lending, Construction Loan and Real Estate Lending, Equi pment Leasing, Residential Lending, International, Cash Management, Online Banking, Property Management Banking, HOA and Remittance Processing services. In 1999, Scripps Bank was awarded the Findley Reports "10 Year Premier Performing Bank" award. For more information on Scripps Financial Corpor ation and Scripps Bank, visit the company's web site at http://www.scrippsbank.com.

The definitive agreement to merge with U.S. Bancorp (NYSE: USB) was announced in a press release issued June 27, 2000, whereby U.S. Bancorp will acquire Scripps Financial Corporation in a stock transaction valued at approximately $155 million. The acquisition is pending approval by Scripps Financial Corporation shareholders at a special meeting of shareholders to be held on October 13, 2000.

ADDITIONAL INFORMATION

U.S. Bancorp has filed a Registration Statement on Form S-4 in connection with the merger. Scripps Financial Corporation mailed a Proxy Statement/Prospectus to its shareholders on September 13, 2000. These materials contain more information about U.S. Bancorp, Scripps Financial Corporation, the merger and related matters. U.S. Bancorp has also filed a report on Form 8-K addressing the transaction with Firstar Corporation. Investors are urged to read the registration statement and the proxy statement/prospectus and any other relevant documents filed with the SEC, because those materials contain important information about the proposed transaction. Investors can obtain the documents free of charge at the SEC's website (www.sec.gov). Documents filed with the SEC are also available through commercial document-retrieval services. In addition, documents filed with the SEC by Scripps Financial Corporation may be obtained free of charge by contacting Scripps Financial Corporation, Attn: Investor Relations, 5787 Chesapeake Court, Suite 104, San Diego, CA 92123, (858) 456-2265. Documents filed with the SEC by U.S. Bancorp will be available free of charge by contacting U.S. Bancorp, Attn: Office of the Corporate Secretary, 601-2nd Av. S., Minneapolis, MN 55402, (612) 973-1111. Shareholders should read the Proxy Statement/Prospectus carefully before making any voting or investment decision.

Scripps Financial Corporation, its directors and executive officers are soliciting proxies from the shareholders of Scripps Financial Corporation. The directors and executive officers of Scripps Financial Corporation are identified in the report on form 10-K filed with the SEC. These individuals beneficially own approximately 32% of the outstanding shares of Scripps Financial Corporation. Additional information regarding the persons who may, under SEC rules, be deemed to be participants in the solicitation of shareholders of Scripps Financial Corporation in connection with the proposed merger, and their interests in the solicitation, is included in the Proxy Statement/Prospectus.

Statements concerning the expected effective date of the merger, future developments or events, and any other guidance on future periods, constitute forward-looking statements which are subject to a number of risks and uncertainties which might cause actual results to differ materially from stated expectations. These factors include but are not limited to regulatory reviews and approvals, competition in the financial services markets for deposits, loans, and other financial services, and general economic conditions. The forward-looking statements should be considered in the context of these and other risk factors disclosed in the Company's filings with the SEC.

SOURCE Scripps Financial Corporation
CO: Scripps Financial Corporation; Firstar Corporation; U.S. Bancorp; Scripps Bank
ST: California
IN: FIN
SU: TNM

Where the money still flows in Silicon Valley
By Andrea Orr

PALO ALTO, Calif.(Reuters) - Anyone wondering who in the world would still invest in a money-losing Internet start-up, need look no further than Tellme Networks Inc., a young, 250-person operation, which announced this week it had raised an astounding $125 million from a blue-chip list of investors.
Actually, the company had raised $150 million, but who's counting? Mountain View, Calif.-based Tellme decided to turn away some of the money after calculating a lesser amount could safely keep it going for almost two more years.
As the dot-com layoff announcements pile up and even many of the more stable Internet companies find they have drained the stream of easy money dry and are counting the months until they might turn a profit, Tellme's funding announcement caused more than a few jaws to drop.
It was not just the size of the financing package, although that was unusually large even by last year's extravagant standards. But Tellme's latest cash infusion came on top of some $113 million it had raised in three previous financing rounds completed over the past 15 months. With three rounds of funding often the acceptable limit, after which start-up companies must turn a profit, find a buyer or take their shares public, Tellme had managed to find a group of investors happy to watch the red ink flow for a while longer.
This for a company best known for services like horoscopes and restaurant listings it provides over an 800 number (1-800-555-TELL) so that consumers can stay connected even when they are on the run. Although venture capital investments in high tech are by all accounts rising, there has been a marked shift away from companies that offer consumer services and could be dependent on Internet advertising, in favor of things like software and equipment.
Tellme is not focused just on the business-to-consumer, or B2C space that has long since gone out of fashion. But it is not the typical equipment maker that is so popular among investors today, either.
"I think we witnessed the flight to quality in the private equity markets," said Mike McCue, the more than a little pleased chief executive of Tellme, when asked how he had managed to find so much cash.
"There are fewer good companies now, so when investors find a rally good one, they invest big. There's not that many of them."
Whether it is really a flight to quality, or just a new flavor of the month remains to be seen. But Tellme, one of several "voice portals" delivering spoken Internet content over the phone, seems to have built up additional goodwill with its star management team and its ability to adjust its business model to fit the prevailing climate.
Ever since Tellme was founded last year, it has basked in a much bigger spotlight than similar companies like BeVocal and NetByTel, thanks to its high-profile management team drawn largely from Microsoft Corp. and Netscape Communications. Building on this theme of one-time business rivals becoming friends in the interest of better technology, Tellme also received early funding from former executives of both Netscape and Microsoft as well as from some top venture capital firms.
"It's just a fantastic team, one of the strongest management teams I've seen," said Kevin Harvey, a partner at Benchmark Capital, which participated in Tellme's latest funding round. Harvey also said a combination of developments from improved voice-recognition software to consumers' growing dependence on on the Internet to access information like weather reports and stock quotes, makes it a good time to push a service like Tellme's that combines the Internet and the phone.
Although the voice-recognition technology still has many glitches and can stumble over even subtle accents, there is a sense that it has gotten good enough to provide a satisfactory consumer service most of the time. Last month, America Online Inc. (AOL) also moved aggressively into this market for spoken content when it purchased Quack.com, a rival of Tellme's, for undisclosed terms.
But after so many other compelling Internet businesses have failed to turn customers into profits, Tellme could not ride on its management team or its technology alone. As the market for Internet advertising began eroding, Tellme shifted its focus from an all-free consumer service that might have to be ad-dependent to one in which it would sell its technology to other businesses wishing to launch their own voice services. "We are different from a lot of the competition in that we are providing a network that enables other businesses to use our service," said McCue, who noted the company will continue to offer its own service for consumers but expects to make the most money from its business services.
The company has yet to announce its corporate partners, but has cited potential examples like airlines or even local taxi companies, which could use Tellme's network to let customers check schedules, buy tickets, or even arrange for a ride home from the airport. It is betting that businesses will find this kind of partnership a bargain, compared with the hefty cost of maintaining fully-staffed call centers to answer customer queries

Cisco, Microsoft use employee stock options to wipe out tax liability

SAN FRANCISCO (AP) -- Cisco Systems Inc. and Microsoft Corp., two of the nation's richest companies, capitalized on the windfall profits of their employees to wipe out their federal income tax bills last year.

San Jose-based Cisco, the second most valuable U.S. company behind General Electric Co., eliminated a $1.8 billion income tax liability by deducting the gains that its employees realized from stock options during the company's most recent fiscal year.

Redmond, Wash.-based Microsoft, the world's largest computer software company, recorded a $5.5 billion tax benefit by deducting its employees' profits from stock options during its last fiscal year. Microsoft reported federal and state tax liabilities of $4.74 billion in the year ending June 30. Cisco earned $2.7 billion in its last fiscal year ending July 29. Microsoft's profit totaled $9.4 billion. The San Francisco Chronicle detailed the tax relief received by both Cisco and Microsoft in Monday's editions, based on recently released financial statements.
Corporations are allowed to deduct the gains of their workers' stock options because the profits are regarded as employee compensation, just like regular wages.
Nevertheless, even a leading anti-tax group criticized the practice that allowed Cisco, a leading maker of computer networking equipment, to skirt taxes.
``For a company that makes that kind of money not to pay taxes raises serious tax-equity questions,'' said Jon Coupal, president of the Howard Jarvis Taxpayers Association.
Stock options, a staple of most compensation packages in the technology industry, give an employee the right to buy a specific number of shares at a fixed price. The difference between the fixed price and the actual stock market price at the time an employee redeems the options result in a profit for the worker and a deduction for the business.
The boom in tech stocks over the past few years has generated staggering gains for employees and substantial deductions for employers.
For instance, Cisco's 34,000 employees earned more than $7 billion by exercising stock options during the company's most recent fiscal year, according to the Chronicle. Those employee profits resulted in a $2.5 billion tax benefit for Cisco in fiscal 2000, up from $837 million in fiscal 1999 and $422 million in fiscal 1998.
While they snap up the tax benefits provided by stock options, high-tech companies have fiercely opposed proposals that would require them to deduct the cost of issuing the options from their reported earnings.

The List

"It is merely an informal recap of major changes. Those major changes may not necessarily be adverse changes, as when a leasing company that is struggling for funding is acquired by a major bank...It merely puts lease brokers and small leasing companies on alert that there may be some policy changes at their funding sources."
Bruce Kropschot

44 Leasing Companies Major Changes

American Business Leasing ( gone )
Balboa Capital ( Founder Byrne "...office available any time he wants to use it" ).
Bancorp Financial Services in Sacramento, California. (10/03 purchased by Humboldt Bank ).
The Bancorp Group, Inc. (Southfield, MI) ( no longer in business )
Bankvest (bankrupt)
Bombadier ( reported having problems, not confirmed )
Charter Financial ( purchased by Wells Fargo 9/5/2000 )
Colonial Pacific (11/98) purchased by GE Capital Commerce Security ( closed to leasing broker program )
Copelco ( sold to Citibank )
Creative Capital" of Bloomfield Hills, MI. ( shut-down 3/2000 )
Dana ( sold off, active as captive )
DVI Capital ( out of broker )
eLease ( June/July/2000 senior management changes )
FMA Finance ( reportedly closed to brokers )
Fidelity ( acquired by EAB, a wholly owned subsidiary of ABN AMRO Bank N.V., headquartered in the Netherlands, raising funds )
Finova ( out of market place )
Franklin Bank ( no more leases )
Imperial ( sold portfolio )
Lease Acceptance Corp---( ceases broker business 7/26/2000 )
Leasing Solutions ( bankrupt )
Liberty Leasing ( closed, California company )
Linc Capital ( out of vendor and broker business, Nasdaq halts stock sales, $13.4 loss last quarter )
Manifest Group--( 9/1/2000 purchased by US Bancorp Leasing and Financial, "...a win for all the parties     involved," Brian Bjella.
Matsco Financial ( purchased by Greater Bay Bank )
Merit Leasing ( gone )
Metwest Leasing, Spokane Wa. ( advising brokers that they have run out of funds so they are unable to fund     a transaction we have there for funding. )
Metrolease--reports closing operation,John Blazek at Evergreen Leasing, Hathcock losing assets, will not     confirm nor deny; many serious rumors of fraud floating around the marketplace.)
NationsCredit, Business Leasing Group (1/29/99 sold to Textron**) *"The Business Leasing Group of Nations Credit was sold to Textron and we still do broker business," Jim Merrilees.
New England Capital ( sold to Network Capital Alliance a division of Sovereign Bank. Sovereign did hire two     people who will run a sales office in CT, doing basically the same deals with the same people as before.     Little will change in that aspect.
Newcourt ( sold off )
Onset Capital ( Irwin buys 87% equity )
Orix ( closes small ticket vendor division in Portland, Oregon, "Business as usual (in New Jersey and with     brokers)," says Steve Geller )
Phoenix ( both divisions )
Prime Capital ( "yes and no" sold off, may be negotiating )
Republic Leasing, South Carolina 9/27/2000 ( "The expected result will be a sale of Republic Leasing"---Dwight     Galloway )
Rockford ( sold to American Express )
Scripp Financial ( 6/29/2000 ( purchased by USBancorp )
SDI ( closed to broker programs )
SFC Capital ( 9/15/2000 purchased by Trinity Capital )
SierraCities ( post $7.7 million second quarter loss, rumors abound,including pending sale. addendum to     Special Report on hold until after announcement, now Oct. 19th? )
T&W ( bankrupt, lost their listing )
Transamerica ( sold )
Unicapital ( $11.4 million first quarter loss chairman,CEO,CFO resign, 38 employees cutback, 8/23 BSB to use     other funders reported, rumor that BSB will be "spun off", not confirmed and appears to be in the rumor     stage right now. Good news, 9/1 Bank of America extends revolving credit line to October 16,2000.     9/29/2000 Many rumors floating around. Leasing News working special report on this company is on hold ))
USA Capital Leasing ( gone-bk )

any corrections, additions, or comments are appreciated.