Internet ad startup hit hard by Consumer Finance crackdown

Nikkei has news on poor financial results of many startup companies last year:

Tuesday, May 22, 2007

Earnings Growth For Start-Ups Slowed To Single Digits In FY06

TOKYO (Nikkei)–Start-up businesses, which had been piling up double-digit earnings gains, saw their pretax profit growth slow to the single digits for the fiscal year ended March 2007 on a slump in online advertising and intensifying competition.

The latest slowdown among start-ups stands in stark contrast to the double-digit growth major corporations racked up in fiscal 2006 amid the global economic expansion.

While companies such as social networking service provider mixi Inc. saw the unit price for ads rise in line with increased membership, conditions were harsh for online advertising agencies as a whole.

Cyber Communications Inc. (a subsidiary of Dentsu), which posted a 21% profit drop, said that its earnings suffered because financial firms and insurers refrained from advertising.