Sweat rewards; We've got the hots for you: Hot business, hot opportunities, hot markets, hot trends. Grab a cold drink, because 2002 is gonna be a scorcher

Entrepreneur, Dec, 2001 by Amanda C. Kooser, Geoff Williams

* Go Hollywood. Britney Spears shakes it for Pepsi, hot auteur Guy Ritchie directs wife Madonna in a short film featuring BMWs (seen online), and FedEx gets the product placement opportunity of a lifetime in Cast Away. As consumers discover more ways to skip commercials, businesses and advertisers are trying to draw them back by offering big doses of entertainment with their marketing. Says Douglas Jaeger, interactive creative director for advertising behemoth TBWA\Chiat\Day in New York City, "Product placement isn't new, but creators of programming are now willing to collaborate more heavily in developing content around placement."

While chances are remote that entrepreneurs will get their products featured in a blockbuster movie, smaller-scale collaborations are viable. Try working with a PR agency that specializes in product placement--Los Angeles- and New York City-based agencies are a good bet. Keep in mind, the terrorist attacks of September 11 may make consumers less interested in celebrity endorsements.

* Smart e-Mail Campaigns. E-mail spam is noxious, but don't count out permission-based e-mail marketing--a low-cost, targeted and fully trackable option for talking with your public. "Companies are realizing the power in developing a one-to-one dialogue if e-mail marketing s used judiciously," says DeeVee Devarakonda, chief marketing officer for Quaero, a customer relationship management company in Char lotte, North Carolina. Devarakonda advises entrepreneurs to explore outsourcing your e-mail marketing and to be sure to measure response rates for all promotions.

MONEY IN 2002

ASK the experts what's up in business agree on three things. First, there's a lot of money out there. Second, only truly innovative technologies and companies will attract capital. Third, investors are already taking advantage of companies' lower valuations and are bottom-fishing for good deals.

"There is a huge amount of uncommitted capital that has been raised and is available for venture-stage businesses," says Dave Wanders, executive vice president at Transamerica Technology Finance in Rosemont, Illinois, which pro- vides debt financing to emerging-growth businesses. "But since neither the IPO nor the M&A markets appear to be opening up anytime soon, investors will be much more selective."

Businesses with cutting-edge products and services will net the lion's share of capital. According to Stephan Mallenbaum, a tech attorney for legal powerhouse Jones Day Reavis & Pogue in New York City, "Entrepreneurial companies that drive innovation will continue to succeed and will find there is no shortage of risk-based capital."

That's the good news. The bad news is that some capital sources might try to take advantage of entrepreneurs in what promises to be a tepid fund-raising environment. Ora Smith, president of Science and Technology Campus Corp., the research park and venture capital affiliate of Ohio State University in Columbus, predicts that "canny investors will take advantage of the economic slowdown and public market retrenchment to lock up novel technologies and business opportunities by taking positions at attractive valuations." In other words, investors will want more of your company for fewer investment dollars.