Better Business
Issue #1 - May/June 2012
Published by the National Minority Business Council, Inc.
The Man Behind
The Burgess Group
This Issue
Better Business
Issue 1 - May/June 2012
Volume 1 - Issue 1 - Spring 2012 NMBC Better Business Staff Publisher / Editor In Chief John F. Robinson Executive Editor Dawn Henning Campus USA Contributing Editors Alan J. Rude Amanda Luz Henning Santiago Breno Pires Donna Williams Fritz E. McLymont Design, Layout & Graphics Breno Pires Eizle-Bern Galang Administration Alisson Hodges Jaquaye Hughley 120 Broadway, 19th Floor (212) 693-5050 | fax (212) 693.5048 New York, NY 10271 NMBC Better Business is a free digital publication for NMBC’s members, supporters and partners. Know more about National Minority Business Council at: http://lnk.co/IRZ1L http://lnk.co/IRZY5 twitter.com/USNMBC72 youtube.com/USNMBC PAGE 2
4
32nd Annual Awards Luncheon
6 7
NMBC News Education + Entrepreneurship
Cover / Member Profile The Burgess Group
11 12 14 16 17 18
Technology News The new iPad
Business & Culture Multicultural Audience Development Program Finance Services Business Plan
NMBC Briefs NMBC’s April Business Report NMBC Briefs Harlem Entrepreneur Fund
Global Business News Potential Customers
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
Publisher Page
A new beginning The NMBC is proud to release the NMBC Better Business magazine in digital format after a 22 year absence. The digital format of NMBC Better Business includes many of the same departments that the hard version of the magazine contain from 1980-1990. Many new departments have been added in this digital version of NMBC Better Business magazine are relevant today but did not exist in content 22 years ago. For example, our technology news department clearly is one that reflects the times that we are living and doing business in today. Another new department in NMBC Better Business digital format that was not part of the 1980”-1990” printed version of the magazine is our Business and Culture department that talks about what the Metropolitan Museum of Art is doing to reach business persons that would not normally patronize the Museum through its Audience Development Program. Our cover story for this new digital version of NMBC Better Business magazine is a long time member of the NMBC and former Board Chairmen, Mr. William H.Burgess, 3rd of the Burgess Group an Executive recoupment and placement firm. Mr. Burgess has been associated with the NMBC for over 30 years. We at the NMBC hope you find this new digital version of NMBC Better Business magazine as exciting and useful business wise as our readers found it during the 1980”1990” timeframe when it was published in the print version. I take great pleasure in bringing back NMBC Better Business magazine to a new generation of NMBC members and entrepreneurs in general. Please let us know what you think of the new NMBC Better Business magazine via our email: info@nmbc.org In the future, we will offer many opportunities to advertise in NMBC Better Business digital. Respectfully,
John F. Rob inson Publisher NMBC President & CEO
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
PAGE 3
NMBC News
A lunch to celebrate The National Minority Business Council’s 40th Anniversary “Kick Off” was held at the 32nd Annual Awards luncheon, at The Marriot Maquis Hotel in New York City
PAGE 4
1
2
3
4
5
6
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
NMBC News
7
9
10
8 On February 29th 2012, the NMBC hosted their Thirty Second Annual Awards Luncheon at The Marriott Marquis Hotel in New York City. This is the first of many events this year celebrating the 40th Anniversary of the National Minority Business Council. The event honored individuals who have excelled in their fields during the year. RenĂŠe M. Brown, CEO of C.W. Brown, Inc , was the Mistress of Ceremonies and David L. Steward was the Keynote Speaker. Steward founded World Wide Technology, Inc. (WWT) in 1990. With over 20 years of experience in the technology industry, WWT is an extraordinary company achieving honors, respected clients and exceptional services around the globe. This year, the NMBC honored 14 companies in 9 categories. Check out the pictures of the award recipients. NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
1. Outstanding Educational Institution Award Pace University | Lubin School of Business, Interactive & Direct Marketing Lab 2. O utstanding Minority Business Award CPS Union | Virtcom Consulting 3. Special Achievement Award - Metropolitan Museum of Art’s Multicultural Audience Development Initiative 4. Dena Coye Outstanding Woman Entrepreneurship Award - Peak Diversity Search, Inc. | The Studio | Spanier Building Maintence 5. O utstanding Technology Firm Award Info People Outstanding Corporate Supplier Diversity Award 6. Northrop Grumman Corp. 7. BNY Mellon 8. Outstanding Global Business Award China International Exhibition Promotion 9. O utstanding Veteran Owned Business Award Compu-Tech 10. Charles T. Haffey Community Service Award Asian Americans for Equalityt
PAGE 5
NMBC News
Education + Entrepreneurship =
EMPOWERMENT The National Minority Business Council, Inc. (NMBC), Monroe College and BNY Mellon have created the NMBC Executive Management Program for Minority & Women Business Owners A five track comprehensive educational program and practicum to prepare business owners and their senior staff to grow and compete in the Global Economy. Program workshops will be taught by working professionals who are experts in their fields and who understand the needs of entrepreneurs. Participants will be able to take back what they learn in the classroom and apply it immediately to their businesses. THE PROGRAM STRUCTURE & LEARNING TRACKS A. Management, Leadership & Strategic Planning 1. Personal financial planning and wealth building strategies 2. Developing personal leadership skills 3. Special issues of minority and women owned businesses 4. Strategic planning & managing risk B. Growth Strategy & Financial Management 1. Business plan development 2. Accounting principles, financial analysis and cash flow management 3. Business valuation, banking relations, preparing a loan package 4. Raising private equity, venture capital C. Brand Management & Marketing Strategy 1. Developing a customer focused sales strategy 2. Selling and sales negotiating tactics 3. Developing marketing, advertising and PAGE 6
communications strategies 4. eMarketing & social media D. Procurement, Alliances & Compliance 1. Negotiating supply contracts 2. Strategic supplier partnerships & alliances 3. Responding to a bid invitation, preparing an RFP 4. Survey of business, employment & intellectual
property laws E. Human Resource Strategy & Development 1. Talent acquisition and human resources management 2. Managing a technology based business 3. Risk management principles 4. Information systems for business owners For more information, contact the NMBC at info@ nmbc.org.
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
Member Profile
The Burgess Group Corporate Recruiters International, Inc. In our global economy DIVERSITY matters and makes good business sense A successful entrepreneur since when he was a kid winning scientific awards and academic scholarships, William H. (Bill) Burgess, III raised, sold and experimented on chickens, ran an art gallery and a high end office furniture dealership while serving on Museum boards. Those special qualities came from his family. No Burgess male since slavery has worked for anyone. Bill’s great, grand and father had their businesses and so had his grandmother. According to Bill, one of the greatest things about being an American is that one has the ability to determine one’s own destiny. “The most important thing about our capitalistic system is that it affords every American the freedom and opportunity to create and define themselves”. In 1994, Bill launched The Burgess Group – Corporate Recruiters International, Inc., a mid to senior level retained executive search, diversity recruiting, training, human resources and management development consulting practice in New York City and New Fairfield, Connecticut with affiliate offices in Birmingham, Alabama and London, England. The Burgess Group has distinguished itself for successfully placing mid to senior level minority, women and majority executives in major Fortune 100 companies in the consumer product goods and services industry; as well as in national and international institutions, associations and organizations. The Burgess Group specialize in “strategic placements from the manager/director ranks through senior management and the corporate board room”. As demonstrated by its outstanding Client List, The Burgess Group is known nationally and internationally for identifying exceptional management and administrative talent for both profit and not for profit sector corporations and organizations NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
(70/30%). It has extensive professional networks and associations representative of all US populations and industry disciplines. As a generalist, retained search firm, The Burgess Group provides their clients an inclusive candidate slate on every search and guarantees their hired candidates for one (1) full year. Positions recruited by The Burgess Group start at $75K and above. The best and the brightest diverse and majority talent are built-in to its database and proprietary search processes. The Burgess Group is certified with all city, state and federal agencies nationally. Let’s talk about how you entered the business world. I was dating a woman who worked for Xerox. She earned more than I did,
“The most important thing about our capitalistic system is that it affords every American the freedom and opportunity to create and define themselves”. William H. (Bill) Burgess, III
even though I was the Director of the Brooklyn Children’s Museum’s MUSE at the time. She thought I could be a good Sales Representative, earn more money and suggested that I interview to work at Xerox. I got the job without even wearing a suit and later always exceeding my sales quotas knocked on every single door in the Empire State Building and the garment district of New York City selling Xerox’s PAGE 7
Member Profile complete line of reprographic equipment including the then newly introduced facsimile and color copier machines. At Xerox I decided that I wanted to sell office furniture because I could use more of my design background calling on major corporate facilities and architect and design firms. In 1982, I partnered with three office furniture dealers in New York City that owned Furniture Consultants, Inc., the best full service professionally run office furniture dealership in the metropolitan New York area at that time. Prior to that, I had been Director of National Accounts Marketing for the Gunlocke Company. The president of the Gunlocke Company was trying to buy the company from its owner, Sperry Hutchinson, which he did. He asked me to help him by bolstering national sales and maintaining market share and in return he would help me go into my own office furniture dealership franchise with Furniture Consultants if the buyout deal went through. I agreed and made sure our sales and marketing numbers were up and at levels that were in sync with the business plan projections. What can you say about starting your own company and what would you advise new minority and women entrepreneurs? It was inevitable that I would own and operate my own company. My Dad drummed it into me from when he taught me how to write my name and count my time tables. He was strict and my Mother was a school principal and artist and I did everything they both told me to do with pride and honor. New minority and women entrepreneurs must first decide what they are passionate about. What professionally moves them, be it a particular industry, discipline, product or service. And then, they must really know the field they are embarking upon from soup to nuts. If financing is an issue, they should secure partners who can bring additional financing, expertise, and contacts to the table. This will make them stronger in knowing about and battling against their competition and facing the many prospective client rejections they will encounter. They must be focused and committed but PAGE 8
willing to be flexible and open to compromise, i.e. a piece or percentage of a deal is better than holding out for an all or nothing decision. Always give credit and thank the people, your customers and network associations that have helped you. Be sure to give back by buying and selling from each other and mentoring future entrepreneurs. How do you think NMBC can help companies to grow? For many years I have been a member of the National Business Council, this 40 year old association has been dedicated to assisting minority and women owned businesses in obtaining procurement opportunities and contracts with national corporations and major governmental agencies. I first became a member in 1982 when I launched my office furniture dealership in Garden City, Long Island. I later directed the Membership Committee before becoming an award winning MBE of the Year
firm and later Chairman of the NMBC Board of Directors. During that period, the NMBC was well known and highly regarded for its MWBE procurement training and development programs it conducted in conjunction with Fortune 500 corporations, fellow not for profits and city, state and federal agencies. During my administration of the Board, we started the NMBC Women’s Committee which published its own national directory of women owned businesses and held the first of now an annual tradition of Women Business Owner Conferences with the continuing sponsorship of the Bank of New York Mellon. Another growth attribute of the NMBC has been its many membership business networking sessions, expos, seminars, events, and best practices presentations it has hosted on behalf of promoting MWBE, SBE and DBE enterprises. What is the
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
Member Profile current state of the economy as it relates to recruitment and what industry disciplines are recruiting? Since my business is about job creation, recruitment and diversity hiring and retention at the mid to senior levels, plus fine art sales; like all businesses, the 2007/8 near economic collapse and consequent down turn has made the subsequent recovery we are now going through extremely sluggish and painful. We have had to lay off staff, cut expenses, but now I can say there seems to be light appearing at the end of the proverbial tunnel. Industries that seem to be doing the most hiring have been in construction and all its discipline parts, engineering, project management, real estate development, architecture and facilities; education; healthcare, technology and security. How does The Burgess Group view the future of mid-to-senior level professional recruitment? The Burgess Group has established itself as one of the premier retained executive search firm in the consumer product and services industry, over the past 18 years, yet economic market forces have necessitated that we become a more “one stop shop” source of recruiting, diversity search and human resource services. Our total programmatic offering includes targeted executive search, diversity recruiting, corporate board governance consulting and soon will also offer temporary staffing services. This four-prong approach is The Burgess Group’s response to our clients recruiting requirement requests and current economic conditions in the business world. However, in order to become a “single source human resource practice” for our past, current and future clients, the plan is to extend our offerings by adding temporary staffing services. Due to the increasingly adaptable necessity of the labor market and companies continuing desire to cut costs makes this new service a convenient tool to better satisfy all of our clients’ temporary, contingent and strategic employment requirements in volatile, competitive national and global economic markets. The Burgess Group’s main goal is: to become the retained executive search and diversity recruiting firm of choice for major domestic and NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
WHB,III: “One of the greatest things about being an American is that one has the ability to determine one’s own destiny”.
international companies, governmental agencies, institutions, associations and organizations worldwide. Are you becoming more global? If so, how? If not, why? Absolutely, and we are. We have clients in France, the Netherlands, Switzerland, Australia and China. For international expansion, we use our office in New York for western hemisphere Americas, and our affiliated office in London for penetrating all other world markets. London, being one of the other major
business centers in the world is viewed as a perfect location to base our expansion into Europe, Asia, and Africa. We are currently developing a timeline to achieve our overall international objectives, and since we already have a presence in London, our expansion is significantly underway and we will definitely continue to take The Burgess Group diversity recruitment brand global. Visit www.The BurgessGroup.com and www.Burgess FineArts.com. PAGE 9
PURPOSE The National Minority Business Council, Inc. (NMBC), a not-for-profit 501 (c)(3) corporation, was founded in December 1972. The primary purpose of the organization is to enhance the success and profitability of the small business community through the provision of highquality services, programs, advocacy and networking support. The secondary purpose is to act as an information clearinghouse for the women- and minority-owned business enterprise (MWBE) community. SERVICES The NMBC is an umbrella organization that encompasses hundreds of small businesses located nationally and internationally. Given the various levels of managerial expertise among the membership, the NMBC strives to develop programs that are suited to the needs of the novice as well as the seasoned entrepreneur. Current services include: an Annual NMBC Vendor Directory, an Annual Corporate Purchasing Directory, Purchasing Exchanges, a Procurement Bulletin Service, the International Trade Program, the Export Management Training Program, the Electronic Data Interchange (EDl) and Electronic Commerce (EC) Training Program, the Mentorship Management Training Program, and the NMBC Business Report Newsletter and Cable Television Show. In addition, the NMBC sponsors networking gatherings to help members learn from each other and gain business leads. GOVERNANCE The NMBC is governed by an eleven-member elected Board of Directors. To ensure that the NMBC’s governing policies are in line with the needs of the M/WBE community, only members are eligible for election to the Board of Directors. The officers of the Board are: Chairman, Vice Chairman, Secretary, Treasurer, President and CEO. SUPPORT The NMBC is a private sector initiative funded by membership dues and contributions from foundations and major corporations. The Annual Business Awards Luncheon is the NMBC’s principal fund-raising event. Each year NMBC supporters and friends gather to acknowledge the efforts of both large corporations and small, minority and women-owned businesses. Corporations are acknowledged for their development of effective minority business development programs, while small, minority- and women-owned businesses are recognized for their sales productivity. ACCOMPLISHMENTS The NMBC’s ability to be effective is strengthened by its history of strong program initiatives, the active participation of its membership and its relentless pursuit of opportunities for its members. It has gained the respect and support of the corporate community by offering its members management expertise and entrepreneurial opportunities they desperately need to develop viable businesses. For more detailed information about NMBC initiatives, please call the NMBC at (212) 639-5050 or visit our Websites: www.nmbc.org, www.nmbcglobal.org.
Technology News
The new iPad
The new Apple’s success iPad was recently released with new features that should impress and help not only customers, but companies that can use the mobile touch computer in their business. Four times more pixels then iPad 2, the new retina display transforms the entire iPad experience: everything looks and feels incredibly lifelike and perfectly detailed with 2048x1536 pixels of resolution in the same 9.7 inch space size. All of that thanks to the new technology combined with the new A5X chip with quad-core graphics. With 10 house of battery life you can use a lot of the new 5 megapixel iSight camera. The camera records HD videos in full 1080p using a new fiveelement lens structure. Now you can get high speed internet anywhere inside your network area with 4G connection available.
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
Chose over 200,000 apps from the App Store, enjoy the stability of the iOS system, iCloud and Dictation advantages and you can stream wirelessly whatever is on your iPad screen to your TV through the AirPlay. It comes with new Safari navigator, Mail, FaceTime, iBooks, Maps, Calen-
dar, Message center and much more, like business apps made exclusively for iPad. You can choose between Wi-Fi only or Wi-Fi + 4G models and their 16GB, 32GB or 64GB versions, starting at US$ 499.
PAGE 11
Business & Culture
The Multicultural Audience Development Initiative Metropolitan Museum of Art’s founding mission to educate and inspire by reaching out to all The 14-year-old Multicultural Audience Development Initiative reflects The Metropolitan Museum of Art’s founding mission to educate and inspire by reaching out to all of its constituencies, including the many diverse communities of the Tri-State Area. The goals of The Museum’s Multicultural Audience Development Initiative are to increase awareness of the Met’s programs and collections, to diversify Museum visitorship and Membership, and to increase participation in Museum activities. The Initiative was founded in 1998 with a meeting of senior Museum staff and leaders from eight prominent African-American civic organizations that include the arts in their programming: 100 Black Men, Inc., Jack and Jill of America, Inc., Delta Sigma Theta Sorority, Inc., The Greater New York Chapter of the Links, Inc., Boys Harbor, Inc., The National Black MBA Association, The National Medical Association, and the New York Coalition of 100 Black Women. The purpose of this gathering was to articulate a strategy for establishing a mutually beneficial alliance with these organizations that would foster interest in The Metropolitan Museum. At the same time, Museum staff and Trustees sought PAGE 12
to develop an understanding of the concerns and needs of these organizations. The Museum then established The Multicultural Advisory Committee, comprising representatives of New York’s African-American, South Asian, AsianAmerican, Hispanic/ Latino, American Indian, LGBT, Muslim and interfaith cultural leaders and organizations. The Multicultural Advisory Committee meets on a regular basis with Museum staff to pursue its ongoing goals. The Committee articulates a strategy for estab-
lishing a mutually beneficial alliance between the local community and Museum whereby interest in the Museum is fostered among the Committee’s constituents and the greater community. We achieve these goals through several outreach activities, including: • Receptions, tours, gallery talks, and lectures that are inspired by the cultural diversity represented in the Museum’s collections; • Support for and participation in many cultural and civic events that affect communities in
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
Business & Culture New York and the Tri-State Area; • Collaborations with The Studio Museum in Harlem, El Museo del Barrio, The New-York Historical Society, The New York Times Community Affairs Department, Museum of Chinese in America, and many other institutes, and organizations; • Celebration of annual heritage months; Through all these joint ventures we invite guests from participating institutions to discover the breadth of the Museum’s collections. Strengthening our efforts through the media is also part of our objective. We are expanding our Initiative to reach community newspapers, radio, and television through advertising, press releases, and media alerts. We are also extending our Internet outreach through the use of social media. Examples of programming in recent years includes several family festivals such as ¡Fiesta!, which attracts Hispanic and Latin American constituencies, and a Lunar New Year celebration to help expand our Asian-American visitorship. The Initiative also hosts an annual LGBT “Post-Pride Party” around our roof garden and The Costume Institute exhibitions. To prepare for the reopening of the Museum’s New Galleries for the Art of the Arab Lands, Turkey, Iran, Central Asia, and Later South Asia, MADI contacted over 100 leaders from New York-based Muslim organizations and interfaith groups such as American Muslim Peace Institute, Anti-Defamation League, The Interfaith Center of New York, Islamic Cultural Center of New York, St. Peter’s Church, The Tanenbaum Center for Interreligious Understanding, Women in Islam, and many others. MADI hosted several receptions and meetings to welcome these guests to the Museum and brief them on the new galleries and collections. In addition to its pursuit of all these goals, the Met Initiative also strives to reach out to different age groups through The Mentoring Program, The College Group at the Met, and Spectrum. The Mentoring Program is designed to encourage college juniors from underrepresented communiNMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
ties and a variety of backgrounds to pursue museum careers. Mentees receive an honorarium to work in one of the Museum’s departments for 10 weeks during the summer. The Mentoring Program also pairs mentees with Museum mentors who provide career guidance and support. This program extends an inclusive and informative hand to the college community at large, and provides new opportunities to college students interested in museum careers. In turn, mentees spread the word at their universities about the Museum and its internship programs. The College Group at the Met (CGM) is comprised of local students who plan and produce events and programs for other students at The Metropolitan Museum of Art. CGM’s mission is to enhance Museum programming with regard to college students, to connect campus communities with
the Museum, and to increase student engagement at the Museum. Through a wide range of programming, CGM creates opportunities for all students—from all backgrounds and academic majors—to encounter and explore the Met’s collection in new ways. Finally, Spectrum is an initiative organized by Museum staff to target postgraduate-age visitors by providing fresh perspectives on the Met’s collections and special exhibitions. Spectrum events offer the chance to interact with contemporary artists, to discuss art, music, video, and new media, and to socialize with other Museum fans.
Donna Williams, The Metropolitan Museum’s Multicultural Audience Development Initiative
PAGE 13
Financial Sevices
How to Write an Effective Business Plan for Financing Growth Reasons for Having a Business Plan The most important document for an entrepreneur wishing to grow his or her business is the BUSINESS PLAN. However, many enterprise owners regard the preparation of a business plan with dread or at least extreme distaste. Business plan writing is viewed as a necessary evil best done during periods of ‘dead time’ and even better done by outside “professional consultants” who specialize in preparing plans. A good business plan serves you, the entrepreneur in two ways: 1) It is a selling document which can be presented to potential investors and lenders to obtain expansion financing and 2) it is a blueprint for you to best measure your performance. With regard to the first: it is likely that eventually you will be approaching investors or banks for the financing for expansion or for working capital. These will require a complete business plan. Regarding the second purpose, without a plan you ‘will be flying blind’ without the benefit of having a road map to compare actual to planned performance. If you are serious about expanding your enterprise, you will regard the development of a business plan as a critical function, every bit as important as marketing, production or sales. It is important that you provide most of the input for the business plan. There are consultants who assert that they can write business plans which will result in successful fund raising. However, you should be extremely wary of these consultants and their services; investors and lenders can spot ‘canned’ presentations easily. Consultants are useful in assisting in structuring and packaging of plans, but the real heart of a business plan must PAGE 14
come from you, the business owner. Business Plan Format When you prepare a business plan with the goal of raising capital, you should be aware of the importance of getting the attention of the target investor or lender. The typical investor sees hundreds of business plans each year. This is especially true of private equity or venture capital firms. It is a chal-
lenge to have your plan stand out in this crowded field and the correct format is essential. The format of a standard business plan is somewhat flexible but all plans should at a minimum contain: 1. Executive Summary 2. Key Investment Considerationsthe compelling reason to invest 3. Business Description 4. Summary of Prod-
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
Financial Services
ucts and /or Services 5. The Market – demographics, growth potential 6. Marketing Strategy and Sales Plan 7. Description of the Competition- why you are different/better 8. Technologies and Proprietary Position (where applicable) 9. Management and Ownership 10. Capital Requirements and Use of Proceeds 11. Long-Term Development and Exit Strategies 12. Financial Reports and Projections While this is a great deal to cover, try to be as concise and clear as possible. Plans of more than 30 pages cause readers to have the MEGO (“My Eyes Glaze Over”) effect. Readers of business plans almost always go immediately to two sections – the Executive Summary first and then the Financial Projections. The Executive Summary has to provide a compelling story in a few words; ideally in no more than three pages. It should never be too cute or ‘gimmicky’. Your readers are serious people making serious investment decisions. The Executive Summary will cover most of the items listed above but in abbreviated form and should always contain summary financial projections going out three years. Two points which are must be, but often are not, addressed in the Executive Summary are: 1) the amount of capital sought and 2) the contact information for the company and the names and addresses of the owners/founders/entrepreneurs. Not including these points will almost automatically send your plan to the ‘circular file.’ After the Executive Summary, the typical reader will go to the financial section. This will be divided into two parts: 1) actual (historical) financial statements, and 2) financial projections. Your accountant (CPA) will prepare the actual statements whether they are compiled, reviewed or audited and will also assist in packaging the financial projections. However these projections should truly reflect your vision for the business and is the primary basis by which the NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
investment/lending commitment will be made. They will also establish the benchmarks against which your company’s performance can be measured. Just putting yearby-year numbers on a spreadsheet is not enough; underlying the numbers should be specific, clear and well-thought out assumptions regarding every aspect of the business. A word of warning: in developing the financial projections, avoid the ‘hockey stick’ where sales and income of the business in the ‘out’ years (years 4 and 5) show huge increases
over the earlier years and when graphed, take the shape of a hockey stick. While prospective investors prefer enterprises which can demonstrate ‘scalability’, that is the ability to achieve significant growth, they are sensitive to unrealistic projections and assumptions. Finally, when you have completed your business plan, make sure to have your attorney review it. In summary, a clear, concise and compelling business plan is critical to obtaining financing and in measuring your progress as your business grows.
PAGE 15
NMBC Briefs
NMBC’s April Business Report The National Minority Business Council (NMBC) is pleased to announce that, working through R. W. Wentworth & Co, a new financing initiative is now being offered to NMBC members and other business persons. Working with Small Business Investment Companies (SBICs) in seven states and DC, we are able to provide lending and credit facilities to firms with a track record of successful operations. SBICs are public /private partnerships oriented toward small business and to the creation of jobs in that sector. As such, SBICs can offer financing generally at more competitive rates and with fewer restrictive conditions than bank financing. The time from applying for a loan to approval is short; one month or less. Of special interest to our membership are the SBICs in New York State, New Jersey, and Connecticut. Companies wishing to access funds from the SBICs in these states must be headquartered in and have 80% of their workforce located in those states. The range of funding we can offer is between $500,000 to $3.5 million for businesses with revenues between $1 million and $50 million. These investments are for companies that are at or near profitability and need additional capital to finance growth, but are beyond the risk parameters of commercial banks. We have the flexibility to consider loans under a variety of structures, depending on the particular needs of the borrower. For our debt investments, we look for the following attributes in prospective companies: • An experienced management team in the industry • Adequate near-term cash flow to service the PAGE 16
loan • Value in the underlying business that may support a loan • Strong growth prospects for the company and industry sector We have recently completed the first stage of a seven- figure financing for an industrial firm. The loan was for a maximum of 30 months with an interest rate of 12%. There were no closing costs and there will be no prepayment penalties. This initiative is designed to supplement the new JOBs Act in ensuring that small businesses have adequate financing as they expand. The JOBs Act, signed last Friday by President Obama, aims to make it easier and less expensive for small companies to grow and take their
company public, decreasing regulation around raising new rounds of funding for initial public offerings. The new JOBs Act makes it easier to raise funds through advertising, and direct solicitation of small investors while at the same time it eases detailed SEC reporting and disclosure requirements. However, to take advantage of the provisions of the JOBs Act, firms will have to reach certain milestones; our SBIC initiative provides the funding to achieve those milestones. To take advantage of the above financing programs being offered by the NMBC through R.W Wentworth & Co. , please contact Mr. Alan J. Rude at alan@rwwentworth. com or call the NMBC at 212-6935050.
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
NMBC Briefs
Harlem Entrepreneurial Fund
The Harlem Entrepreneurial Fund (HEF) is an economic development initiative designed to help small businesses by providing loan capital and technical assistance. Harlem Commonwealth Council, Inc. (HCC) is a not for profit, 501 (c) (3) economic development corporation founded by a group of Harlem community leaders, professionals and business leaders in 1967. HCC is dedicated to the empowerment of the Harlem community through education, entrepreneurship, ownership and job creation. Basic Eligibility • Bronx and Harlem-based small businesses • Three to four year track record • Start-ups may be considered • New York State organized entity NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
• A business plan • Good credit score Products and Services for Eligible Borrowers • Loans up to $25,000 • Low interest rates • One to three year loan terms • Accounting and business literacy seminars • Small business financial management • Provider referrals
How to apply Pick up and application at our offices or download an application at our website: www.harlemcommonwealth. org/hefapplication. Submit a completed application and interviews will be expedited. 361 West 125th Street, New York, NY 10027 (212) 7490900 ext. 122, Fax: (212) 749-1042 PAGE 17
Global Business News
Are you ignoring potential customers?
According to the Office of the US Trade Representative, 95 % of the world’s consumers are outside of the United States and they represent 75% of the world’s purchasing power. Could some of those consumers use your products? If so, why aren’t you selling to them? • Fear of nonpayment ? • Lack of working capital? • Inability to compete with non-US competitors who offer more liberal credit terms? The National Minority Business Council, Inc. (NMBC), an advocate of minority-owned businesses, is partnering with the Export-Import Bank of the United States (Ex-Im Bank) to assist you. Bruce Drossman, Export Finance Manager of ExIm Bank, visited the NMBC recently to discuss two programs intended to help small businesses access necessary capital and manage risk: the Working Capital Guarantee Program and Export Credit Insurance. The Working Capital Guarantee Program PAGE 18
The Working Capital Guarantee Program (WCGP) provides export working capital financing through commercial lenders, guaranteed by Ex-Im Bank. According to Ex-Im Bank’s website, financing can be used for “purchasing finished products for export; paying for raw materials, equipment, supplies, labor and overhead to produce goods and/or provide services for export; covering standby letters of credit serving as bid bonds, per-
formance bonds, or payment guarantees; and financing foreign receivables.” To qualify, at minimum, you must have US based business operations and provide reasonable assurance of repayment (i.e., one year operating history, debt service ability, adequate capitalization relative to the requested loan amount). Worried about your eligibility? Don’t rule yourself out before learning more about the program on www.exim.gov. Drossman described the typical program borrower as one with a large contract in relation to its balance sheet and “tight liquidity, negative cash flow; losses or erratic earnings; minimal net worth; short operating history; and collateral shortfall; [with] workin-progress financing needed.”
NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
Global Business News Need help? The NMBC offers assistance with the application process as part of their effort to help U.S. businesses expand and succeed internationally. “We recognize the importance of providing the technical assistance and support that is necessary to ensure that each firm develops the capacity to succeed in the global marketplace over the long term, by taking advantage of the current opportunities,” noted Fritz-Earle McLymont, Managing Director of the NMBC Global. Are your working capital financing needs small? In March 2012, Ex-Im Bank announced it would soon be rolling out Global Credit Express, a pilot program to improve access to financing for small businesses with working capital needs less than $500,000. Drossman explained that although the WCGP has no predetermined minimum size limitations, “it has proven difficult to attract interested lenders under the Guarantee for small amounts. To address this, Ex-Im Bank announced the pilot introduction of Global Credit Express, which will provide for Ex-Im Bank direct-funded export working capital facilities up to $500,000 in size to qualifying companies under referral from Originating Financial Institutions.” Drossman expects the referral banks to be announced soon. Export Credit Insurance Fear of nonpayment prevents many small businesses from succeeding internationally. Export Credit Insurance reduces the risk involved in extending credit to foreign buyers by providing up to 95% payment default coverage for commercial risks like bankruptcy and certain political risks like war. Allergic to red tape and long application processing times? Apply online for Ex-Im Bank’s Express Insurance. If you need a credit decision on one or two foreign buyers, and each buyer exposure is less than $300,000, Ex-Im Bank will process your online NMBC BETTER BUSINESS #1 / SPRING 2012 / Visit www.nmbc.org
application, make a credit decision on two buyers, and send you a policy quote within five (5) business days. Transactions over $300,000 take longer. To qualify, applicants must be SBA defined small businesses and have: “at least a year’s operating history and a positive net worth; an average of less than $7.5 million in export credit sales over the last 3 years (excluding Canadian sales and any under letter of credit, cash, or sight payments);
an existing file with Dun &Bradstreet; and ten or fewer foreign buyers on credit terms. See the ExIM Bank website for more information. Want the inside scoop on Ex-Im bank’s application process ? Visit NMBC.org to read notes from my Q&A session with Bruce Drossman, during which he spoke candidly about the elements of a successful application and provided recommendations for improving submissions. PAGE 19
Diversity paints our world. We value diversity in the workplace and in the marketplace. In building an increasingly diverse supplier pool, we are able to work toward our goal of offering priority suppliers real procurement opportunities as they arise. BNY Mellon is pleased to announce on-line registration. To register, visit www.bnymellon.com/suppliers select the Supplier Profile Form and follow the directions.
2009 Regional Corporation of the Year NY-NJ Minority Supplier Development Council
Š2011 The Bank of New York Mellon Corporation.