2013 Entrepreneur of the Year by Kat Hughes

M ay 17 - m ay 23, 2013 | T H R E E D o l l a r S

FLOR IDA’S NE WSPAPER FOR T HE C - SUI T E

Freedom | Politicians have buried the country in debt. Here’s how we can save it. SEE INSERT P A S C O • H I L L S B O R O U G H • P I N E L L A s • M A N AT E E • S A R A S O TA • C H A R L O T T E • L E E • C O L L I E R

Entrepreneur of the Year

ia l Spec E I S SU e

Insid7-21 pages

Persistence

Pays Off Steve MacDonald was fired from the first company he built. Turns out, it just gave him a new chance to shine. PAGE 16

Steve MacDonald | CEO, MYMATRIXX PURRRFECT

TECHNOLOGY

SARA-MANA WINNER

Next Steps

Ship and Save

Skeptics Beware

Tricia Bolds’ online pet supplies business has taken off in sales — now come the tough decisions. PAGE 7

NEW MARKETS

DEVELOPMENT

Ahead of the Storm

When the recession threatened his business, Brian Rist expanded his territory. Now he wants to do the same thing with his products. PAGE 8

Good Timing

Brian Stock took some heat for reducing home prices on the cusp of the downturn, but now he’s ready to build. PAGE 14

People can second-guess his company’s products, but It Works Global’s CEO says the proof is in the sales. PAGE 18

Billionaire businessman buys corporate headquarters in Punta Gorda. 22

LEE-COLLIER WINNER

Benderson buys TECO Plaza for $22 million. 23

In Good Taste

As foodies take over the nation’s restaurant scene, Innovative Food Holdings pushes to offer the very best. PAGE 20

Manatee’s Palma Sola apartments sell for $27 million. 24

PAGE

27 Bay area execs change their networking scenery. 85356

DON’T MISS

BlueGrace Logistics can save companies time and money on shipping. That offering has been a recipe for big growth. PAGE 12

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BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

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EMPLOYMENT LAW

Vol. XVII, No. 19

When it comes to legal matters that affect Southwest Florida employers, we understand.

A Division of The Observer Media Group

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Meet the Henderson Franklin attorneys ready to help:

The Business Observer, formerly the Gulf Coast Business Review, is Southwest Florida’s newspaper for business leaders. With offices in Hillsborough, Pinellas, Pasco, Manatee, Sarasota, Charlotte, Lee and Collier counties, the Business Observer is the only weekly business newspaper that provides business leaders with a regional perspective. The Business Observer’s mission is to deliver relevant news and information on Southwest Florida’s leading and growing companies, up-and-coming entrepreneurs and the important economic, industry and government trends affecting business. The Business Observer is also the leading publisher of public notices on the Gulf Coast of Florida.

Editor and Publisher / Matt Walsh, mwalsh@BusinessObserverFL.com Managing Editor / Kat Hughes, khughes@BusinessObserverFL.com Deputy Managing Editor / Mark Gordon mgordon@BusinessObserverFL.com Editor-Lee/Collier / Jean Gruss jgruss@BusinessObserverFL.com Research Editor / Sean Roth sroth@BusinessObserverFL.com Web Editor / Amanda Heisey aheisey@BusinessObserverFL.com Editorial Design / Nicole Thompson nthompson@yourobserver.com

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MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

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CoffeeTalk

Broker, back in action, sees good times ahead Well-known local commercial real estate broker Mindy Kauffman is back in the leasing and selling business after a six-year detour — and she brings good news. Formerly of Sarasota Commercial Management, Kauffman now runs Red Property Management, which handles leasing for several prominent downtown Sarasota buildings. (The properties include a building on Main Street where the Observer Media Group, publisher of the Business Observer, leases space.) Kauffman’s father is Dr. Mark Kauffman, a local real estate developer who has owned and helped build some of the build-

ings in what’s now the Red Property portfolio. Mindy Kauffman sold Sarasota Commercial Management in 2007. She shifted to real estate consulting, with a focus on turnarounds and workouts. But now, back in the thick of leasing properties since January, Kauffman senses a palatable rebound. For example, Kauffman reports lease rates for some properties have retuned to pre-recession levels. “Things are picking up,” Kauffman tells Coffee Talk. “Rents are edging up a bit, especially in desirable locations. We are seeing more activity.”

Sunshine state lags nation in productivity Metropolitan regions across Florida scored poorly on a new report that analyzes employee productivity and employee growth during a three yearperiod, 2009-2011, when the economy was supposedly in recovery. The April report, from the Federal Reserve Bank of Cleveland, probed the growth, or lack thereof, in output per employee and the labor force increase in each metropolitan statistical area. The report is based on data from the U.S. Bureau of Economic Analysis and the Fed. Two of the bottom five regions, out of the 100 largest MSAs in the country, were in Florida: Lakeland-Winter Haven was last, with a -2.1% drop in combined productivity and total employment increase. The North PortSarasota-Bradenton region, meanwhile, fell -0.4% from 2009 to 2011, according to the report, for the fifthworst rank in the country. Significantly, the Sarasota-Bradenton region had 1.7% in employment increase in that time frame, so the drop was based on a -2.1% decrease in employee productivity. The Cape Coral-Fort Myers region had the eighth-worst rank out of the 100 largest MSAs in the U.S., with a

combined score of roughly zero, the report shows. The Tampa-St. Petersburg-Clearwater region, however, by comparison to Gulf Coast and other Florida MSAs, was dynamic, with 2.3% growth in employee productivity plus employee growth. That was good for 74th place nationwide, ahead of Miami-Fort Lauderdale-Pompano Beach and Orlando-Kissimmee-Sanford. The explanation for the scores, the authors write, is essentially the old standby: Follow the money. “On one end of the distribution are MSAs that continued to struggle with the effects of the housing boom and the subsequent bust. Metropolitan areas in the ‘sand states’ of Florida, Nevada, California, and Arizona populate this lower end of the growth distribution,” the report states. “The upper end…tends toward MSAs associated with natural resource extraction or high-tech industries. In addition, several metros associated with automobile assembly also showed significant growth, as production of vehicles picked up markedly over this period.”

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pharmacy owner charged

Del Parrish

File Photo

available figures compiled by the Business Observer for the Gulf Coast 500, an annual ranking of the top companies in the region.

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The pharmacy business is fraught with danger, not the least of which is complying with complex government regulations of insurance reimbursements. The latest entrepreneur to get snared: Del Parrish, owner of Naples-based Sunshine Pharmacy, who fended off large-chain competitors such as CVS and Walgreens with his pharmacy’s customer service. Federal prosecutors recently charged Parrish, 44, with conspiracy to commit health care fraud. The government alleges that Del Parris and Patricia Parris, 73, conspired to file fraudulent claims for government reimbursement from Medicare, Medicaid and Tricare. If convicted, each could face 10 years in prison. It would be a shame if the allegations are proven true, because Parrish built a successful chain of pharmacies with a fleet of delivery vans for homebound customers, wholesale drug distribution to assisted-living facilities and home medical equipment sales throughout the region. Sunshine Pharmacy reported $37 million in revenues in 2010, up 23% from 2009, according to the latest

BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

topstories from BusinessObserverFL.com SARASOTA-MANATEE

Port promotes three execs to leadership Port Manatee, one of the larger seaports in the state, recently promoted three executives. One promotion was of Senior Director of Business Robert Armstrong, who was named deputy executive director and will retain his chief financial officer post. Armstrong will be responsible for the port’s finance and business activities, in addition to telecommunications and information technology, according to a release. Seaport Security Director Frank Holden was named senior director of seaport security, and Compliance Manager David St. Pierre was named deputy director of seaport security. Holden will be in charge of overall security and safety, the release states, and St. Pierre will monitor compliance with federal, state and local laws and regulations related to the port’s security and safety. The port, moreover, announced that Julie Yeh was named corporate communications manager. Yeh was previously supervisor of corporate communications at Sarasotabased FCCI Insurance Group.

quote of theweek

“”

That was the moment I realized, ‘Holy s**t, if I can do this once, I can do it a thousand times.’ Matt Nachtrab | CEO of LabTech Software, on his company’s first big sale. SEE PAGE 10

what do you think?

TAMPA BAY

Law firm opens Clearwater office On May 1, Hill Ward Henderson opened a Clearwater office, to better serve clients doing business in Pinellas County, the firm says in a statement. The new office is located at 311 Park Blvd., Suite 240, just west of U.S. 19 off U.S. 60, in Park Place, a six-story building within an office park. “The new Pinellas County office will be utilized by many Hill Ward Henderson attorneys as they attend to client needs across the bay,” the company says in its statement. Attorneys E.D. Armstrong III and Katherine E. Cole will head up the new office, in addition to working from the firm’s Tampa headquarters downtown in the Bank of America Plaza. The firm recently renewed its lease there for 12 years. CHARLOTTE-LEE-COLLIER

Government to spend millions on beaches The government plans to spend $36.7 million on three beach nourishment projects in Lee County this year. The largest project will be

Should Congress take action to increase oversight of the IRS?

Vote at BusinessObserverFL.com

the $21 million nourishment of 6.4 miles of beach in Captiva and north Sanibel from Redfish Pass to Bowman’s Beach. Federal and state dollars will pay for half the cost of the project, which is scheduled to begin in August and be completed by the end of the year. The next-largest project will be the beach nourishment of 3.1 miles of shoreline from 17th Street to Boca Grande Pass on Gasparilla Island. Federal and state governments will pay for 80% of the $10.5 million project, which is scheduled to be completed by Thanksgiving. The third project is nourishment of one mile of beach at Bonita Beach and another mile at Lover’s Key State Park. State and local governments are funding the $5.2 million project scheduled to be completed in early 2014.

Low reimbursements hurt cancer firm Radiation Therapy Services says a drop in prostate-cancer treatments and lower insurance reimbursements contributed to lower revenues and profits in the first quarter. Radiation Therapy, which operates 127 cancer-treatment Last week’s question:

centers in the U.S. and Latin America, posted a net loss of $19.4 million on revenues of $172 million in the first quarter ending March 31. That compares with a net loss of $8.4 million on revenues of $175.5 million in the same quarter one year ago. Despite the declines in prostate-cancer volumes and lower insurance reimbursements, Radiation Therapy officials say they are hopeful conditions have stabilized. “The declines to prostate treatment volumes from 2012 continue to improve, confirming the trend we saw in the first two months of the year,” says Daniel Dosoretz, president and CEO, in a statement. “While we do expect these declines to persist in the near term, we are cautiously optimistic that they peaked in late 2012 and will level off in mid- to late-2013.” Dosoretz says the company will continue to make acquisitions, including spending $25 million for two undisclosed centers. Radiation Therapy operates 127 treatment centers, including 96 centers located in 15 U.S. states and clustered in 28 local markets. The company also operates 31 centers in six countries in Latin America.

Should women-owned businesses get special considerations or assistance?

37.8% Yes 62.2% No

Un-FAQ Do you know what your clients and colleagues say behind your back? Curious Conversations for Business specializes in customer retention and new business development for professional service firms in finance, technology, marketing and more. No, there really isn’t anyone else like us and yes, we have references. It all starts with a conversation. Let’s talk.

Caroline Amory & Marjorie Floyd 941.524.0463 | info@un-faq.com

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Curious Conversations for Business

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

BusinessObserverFL.com

CoffeeTalk

from page 3

Leadership isn’t for cowards going to build our most lethal competition that would put us out of business in six months, what would we build?” For the person who needs to be in control, Staver says: Let. It. Go. Some companies have too restrictive policies that don’t allow for flexibility, others are too handson. There needs to be a happy medium. And, if you’re the leader who needs to be all things to all people, Staver wants you to just say no. Choose what you say “yes” to carefully, but saying no is the first step toward communicating to your team where your priorities lie, which helps them do their jobs better, too.

VIDEO To see clips from Staver’s talk, visit BusinessObserverFL.com.

Cape Coral tax plan: Watch your wallet We’ll probably never know if Hertz ever considered relocating its corporate headquarters to Cape Coral, but the city in Lee County isn’t exactly laying out the red carpet for new businesses or residents. Hertz recently picked unincorporated Estero in south Lee County to relocate its corporate headquarters from New Jersey. Meanwhile, across the river, the Cape Coral City Council recently approved a new 7% public-service tax on electric bills in exchange for a slight reduction in the property tax millage rate. On top of that, a consultant hired by the city has suggested the city needs to impose an undetermined “fire services assessment.” So it’s understandable why a recent meeting of the Cape Coral Construction Industry Association with City Manager John Szerlag became heated over the

issue. Builders wondered why the city would impose new taxes at a time when the economy is finally recovering from the real estate crash. Rightly so, builders were skeptical of promises that the taxes will help pay for necessary city services. And they assailed the relatively high taxes the city continues to impose on new construction, also known as “impact fees.” Szerlag told the gathering that lowering taxes on new construction hasn’t been considered. “I couldn’t recommend waiving impact fees not knowing what the alternative revenues might be,” he told the visibly agitated group. We’ve heard enough government consultants and politicians promise tax solutions for ailing public finances. When that happens, we only have this advice: Watch your wallet.

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Capital Markets – Investment Banking

Private Equity

Asset Management

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Despite being an experienced manager, there may be a few things stifling your team’s progress —and they may stem from you. That was the message from Mike Staver, a leadership coach and CEO of the The Staver Group, during his presentation at a recent meeting of the Gulf Coast CEO Forum. According to Staver the three things in the way of massive momentum in progress by leaders are: the need to be right, the need to be in control, and the need to be all things to all people. If these sound familiar, don’t worry, Staver also shared some solutions. If you’re someone who needs to be right, Staver suggests developing a mindset of curiosity. He recommends asking your leadership team big, scary, uncomfortable questions such as: “If we were

Sarasota 2050 plan faces possible revisions Developers in Sarasota County won a small victory recently when county commissioners, by a 4-1 vote, agreed to reopen Sarasota 2050 to possible revisions. The 2050 plan, approved in 2002, was the county’s answer to urban sprawl. It was supposed to create a businessfriendly atmosphere for developers to build pedestrian-friendly villages in underserved areas of the county, particularly east of Interstate 75. But the 2050 plan, instead, choked development and growth. The recession, of course, played a role in the slowdown. Yet more than a decade after 2050 passed, only one project has been built through it: Neal Communities’ Grand

Palm in Venice. Developers, including representatives from Lakewood Ranch-based Neal Communities and Schroeder-Manatee Ranch, the firm behind Lakewood Ranch in east Manatee County, spoke with county officials about the 2050 plan flaws. Some developers say the plan is too restrictive and the rules lack flexibility, especially in the types of housing and density limitations. Commissioners agree. They directed county planning staff to study and propose changes in the next two months. The county will then schedule a series of public hearings to debate the possible changes.

Fort Myers loves the ponies the Fort Myers market is a prime area for sports enthusiasts. The area always ranks in the top five markets for golf and in the top 10 the Olympic Games, he says. Beville says factors for the Derby’s appeal included a slew of Derby-related parties in the area. In particular, he says there was tremendous interest in the female jockey Rosie Napravnik. Plus, horse racing is an affluent sport that appeals to the wealthier demographics of the region.

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Who knew Fort Myers was horse country? According to NBC Sports, the Fort Myers market registered the second-highest TV ratings in the country for the Kentucky Derby earlier this month. The broadcaster cited Nielsen ratings, which tracks viewer habits. The No. 1 market, of course, was Louisville, Ky. Bob Beville, the director of sales for Waterman Broadcasting, owner of the Fort Myers NBC affiliate, says

BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

By The numbers

economicsnapshot

3 Business investment The number of areas out of 22 statewide that posted declines in business investment in February compared with the same month a year ago.

$5.0 bilion (Florida statewide) 4.9 4.8 4.7 4.6 4.5

4.4 4.3 Feb. 2012

Punta Gorda’s rank in the state in percentage gain for business investment in February compared with the same month last year.

Apr. ’12

May ’12

June ’12

July ’12

What the data show Taxable sales in the business-investment category include office equipment, computers, hotel and restaurant supplies, transportation equipment, paper and packaging, medical supplies and industrial machinery. The latest data are for February.

3.8%

What it means Punta Gorda, Fort Myers and Naples posted greater annual percentage gains in business-investment taxable sales than the state (up 3.8%). Punta Gorda lagged the rest of the region in the recovery and starts from a relatively low base, so any increase is going to be significant on a percentage basis. Still, Punta Gorda posted the biggest increase of any area of the state by that measure.

Aug. ’12

Sept. ’12

Oct. ’12

Nov. ’12

Dec. ’12

Jan. ’13

Feb. ’13

FEBRUARY BUSINESS INVESTMENT AREA

BUSINESS INVESTMENT ($ in millions)

TampaSt. Petersburg

Forecast Business confidence appears to be returning, though the growth in business-investment taxable sales will continue to fluctuate as entrepreneurs gauge their markets and consumer moods. Business owners are reluctant to take big risks while the economy continues to recover, so expect business-investment taxable sales to continue to post modest gains year-over-year.

SarasotaBradenton

$542.8 1.7% $136.4 0.5% $22.1 16.9%

Punta Gorda Cape CoralFort Myers Naples

% ANNUAL CHANGE

$115.5 6.0% $68.3 4.3% Source: Florida Legislature Office of Economic & Demographic Research

www.ian-black.com www.ian-black.com 941.906.8688

Commercial Guide THE PLACEProperty FOR SPACE

Office Office

Warehouse Warehouse

Retail Retail

Summer 2011 | Issue: No.2.11

Celebrating 10 years 2011 Greater Sarasota Chamber of Commerce Frank G. of Berlin Sr. service to our clients. Small Business of The Year Award Finalist

mercial real estate CELEBRATING market is still coming to terms with the new market realities, the by Ian Black less bureaucratic inIan Black Real Estate ian@ian-black.com terference with supply elcome to the second edi- and demand, the bettion of the Ian Black Real ter chance the market Estate Property Guide! has to return to some Encouraged by the reception that our degree of stability. The increasing sucfirst edition received, we have made the commitment to publish the guide on a cess of Ian Black Real Front row: Debbie Anglin, Joni-Elizabeth Hoehn, regular basis and have given it a new pro- Estate can be attribMichele Fuller, Ian Black, Bob Granicz. Second Row: Dottie Rutledge, Steve Horn, Marci Marsh, fessional layout with advertising support uted to diverse market Nick DeVito II, David Greenberg, Jag Grewal, Alia Wallace. knowledge combined from many our business partners. Front Row: Marci Marsh, TracyofPage, Ian Black, Dottie Rutledge, Michele Fuller excellent team work and an unyield- one that I am asked nearly every day, Middle Row: Debbie Anglin, response Cindy Jean, Nick Melissa Harris The positive to our firstDeVito publi- II, with Back Row: Lonnie Kevin that Peavler, Horn to serve the best interests “How’s the market?” From our perspecingSteve commitment cationHomenuk, vindicated Jag our Grewal, initial thoughts in today’s fast moving world of electronic of our clients. It is both exciting and hum- tive the improved movement we have communication a more tangible presen- bling that our efforts have been recognized experienced since the beginning of the year tation would be appealing to those inter- by the Greater Sarasota Chamber of Com- is promising but the market is still strugmerce and we have been named as one of gling to deal with the new paradigms. ested in commercial real estate. As always our team is at your serI am also pleased to report that in the the three finalists for the 2011 Frank G. vice and we look forward to our ninth first five months of 2011, our results have Berlin Sr. Small Business of the Year. In closing I will again answer the ques- year serving all of your commercial real been more than encouraging and reflect significant increased activity. The com- tion that I posed in our last edition and estate needs. n

YEARS

2003-2013

1075 Central Ave • Sarasota, FL 34236 • 941.906.8688 info@ian-black.com • www.ian-black.com 112684

The average gain statewide in business investment in February compared with February 2012.

Mar. ’12

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

Entrepreneur of the Year

very year, the editors at the Business Observer survey their coverage areas from Tampa to Naples in search of our Entrepreneur of the Year. And every year, the candidates reflect not only the ingenuity and entrepreneurial drive on the Gulf Coast, but also the larger picture of what’s going on in our region.

2013rs e Winniness Bus ver r Obse

Although things have been tough with the recession, it has revealed businesses that have found ways to grow despite hard times and have adapted to the change around them. They are clever, tough and often counterintuitive. Our selection process begins by asking entrepreneur-led companies for revenues for the past three years. Candidates must have revenue growth in each of the those years to be considered. It’s a requirement that’s become more challenging to meet in recent years, no doubt. This year, we spotlight winners in three revenue categories: $1 million to $15 million; $15 million to $50 million;

Bold Business T

“I wanted to be able to provide something for my son,” says Bolds, whose child was a toddler back then. Bolds still aims to provide for her son, but now, six years later, she has additional motivations with her business, Sarasota-based Gulf Coast Pet Supplies. The firm sells and ships an array of pet products, from beds and bark collars to hound heaters and treats. Many of the items are hard-to-find products, sometimes from overseas. A dog owner herself, Bolds says another motivation is to continue to provide a non-chain alternative for other pet owners. A final inspiration for Bolds, a onetime model who learned Web programming on the side, is in the last five years she’s become captivated simply by being an entrepreneur. That captivation shows in the growth. Annual sales are up 117% since 2008, from $1.8 million to $3.9 million in 2012. And Bolds projects at least 40% sales growth in 2013 for the seven-employee firm. “We’re slammed,” says Bolds. “Business is really good.” So good Bolds faces one of a fastgrowing entrepreneur’s biggest challenges: How to spend less time doing all the things she used to do and more time on visionary big-picture plans. “We’ve become so big, so quickly,” she says, “that we are having growing pains.” Bolds, for example, does the ordering and accounting herself, and usually does the re-pricing on the website. The last task has become especially laborintensive because the company has added so many new products recently. Help could be on the way. Amazon. com, where Gulf Coast Pet Supplies does about half its business, recently selected the firm to participate in a

beta program for shippers in the Web giant’s “less than truckload” category. That program, says Bolds, could save the company significant time on packaging orders. Bolds’ passion for entrepreneurialism began, in some ways, when she was a young child at modeling assignments. She modeled into her 20s, and she also appeared on a woman’s pay-per-view professional boxing event. It was in those careers where Bolds first learned how to come back from rejection and stay focused on a goal. She sought more stable work soon after her son was born, which led to Gulf Coast Pet Supplies. The first product, which she admits was “was one of the goofiest things I’d ever seen,” was a Litter Kwitter. Made in Australia, the product, which retailed for $60, was a threestep cat toilet training kit. Gulf Coast Pet Supplies now sells thousands more products. Bolds bought a 3,000-square-foot warehouse/office flex building for the company in 2010, and she added a second floor to the climate-controlled facility last summer. Yet the company is out of space, again, with new products coming in regularly. To manage the surge Bolds faces a thorny entrepreneurial decision. A national products distribution firm recently approached her about a partnership, where Bolds can use the firm’s warehouses in Buffalo and Las Vegas. The distribution firm, in turn, would take care of order fulfillment in the Northeast and West Coast. The per shipment fee the company charges is doable, says Bolds, but the lack of authority over packaging gives her pause. Still, it would cut down shipment time to the West Coast by more than half, from five days to one or two, so Bolds will give the proposal serious consideration. “It’s a little scary,” she says, “but it’s all part of giving up control.” Follow Mark Gordon on Twitter @markigordon

and $50 million plus. We also have chosen a regional winner for each area. But we have to admit, it’s not all objective. We also look for a great story. We look for people who embody the entrepreneurial spirit, who have taken risks and done what it takes to make it on their own. On the following pages, you’ll see both: amazing numbers and great stories. Our overall winner is Steve MacDonald, who started myMatrixx in the back of a warehouse shortly after being fired from another firm he founded. Since it began in 2001, myMatrixx has grown from $267,000 in revenue to more than $72 million in 2012. Yet despite that success, his marketing director told us she had to beg him to wear a tuxedo last year to the Florida Ernst & Young Entrepreneur of the Year awards, for which he was nominated. As you’ll read on page 16, MacDonald bootstrapped the business, and grew it quickly. But one thing stuck out in our reporting. As he started myMatrixx, his third startup, MacDonald said he knew it was his opportunity to build a business on his terms. He was going to get it right for his company and his customers — he was going to run it the way he wanted. That sold us. That’s what being an entrepreneur is all about. — Kat Hughes

Entrepreneur of the

er Winlnion to

$1 mil illion $15 m Gordon

Year

rk By Ma eputy d ging Mana r it d E o

Startup struggles are so 2007 for Tricia Bolds. Now, with a company nearing $5 million in annual sales, she has other pressing challenges. he motivation for Tricia Bolds to start her own business out of her garage in 2007 couldn’t be more altruistic.

BusinessObserverFL.com

Mark Wemple

Tricia Bolds founded an online pet supply business out of her garage in 2007. That company, Sarasota-based Gulf Coast Pet Supplies, had $3.9 million in sales in 2012.

Employees

Revenues Year 2010 2011 2012

Revenue %growth $2.8 million $3.4 million 21.4% $3.9 million 14.7%

$4.0 million

2010

2011

2012

3.5

2.5 Source: Gulf Coast Pet Supplies

$3.9 million

3.0 2010

’11

’12

BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

er Winlnion to

$1 mil illion $15 m russ an G By Je or/leeit d E r collie

Entrepreneur of the Year JimJett.com

Brian Rist, owner of Smart Companies, says rising energy prices will drive business in the years ahead.

Open the shutters

Brian Rist didn’t let the housing recession slow him down. When things got tough, he went to Cancun.

magine you’re in the hurricane-protection business, but there are no major hurricanes for seven years. On top of that, no one’s building new homes in a recession.

When you consider those factors, it’s a wonder Brian Rist’s company is still in business at all. But Smart Companies is growing because Rist responded quickly to changing conditions. “You have to be willing to reinvent yourself all the time,” says Rist, 59, the com-

pany’s owner and chief executive. Over nearly two decades in business, Rist has installed hurricane protection systems such as shutters and screens in the homes of more than 55,000 customers around Southwest Florida. Until the residential collapse, most of Rist’s business was installing such systems in new homes. So in 2007, when homebuilders halted operations in Florida, Rist started traveling in search of new business. He found it in Mexico, where his company installed hurricane protection systems at the Hotel Presidente in Cancun. “One hotel led to another hotel,” Rist says. Plus, there was no competition. “We were the only ones down there,” he smiles. “We built a manufacturing facility in Mexico.” The hotel business carried Smart Companies through the Southwest Florida downturn and allowed Rist the opportunity to broaden the scope of his services such as installing windows, lighting systems and solar-energy devices. “If you keep fishing in the same pond and don’t catch fish, you go to a different pond,” he reasons. “A lot of guys complain their business isn’t doing well, but they’re not doing the basics,” says Gary Hartman, who has supplied aluminum to Rist since he started his company. Hartman says Rist grows the business because he’s not afraid to ask for referrals, put signs in yards where his crews are working and try new ideas. “If you take care of your customers, your business takes care of you,” says Rist, who grew up working in his father’s dry-cleaning plants in Massachusetts from a young age. Indeed, Rist says 48% of his customers in 2012 came from referrals. “That’s the trick. If you have to buy customers every two months, you won’t make it,” he says. Rist says the Internet has been a significant source of referrals, so much so that he spends $10,000 a month marketing on the Web. The company has nearly five full-time information-technology em-

ployees, including one who does social media full-time. “Brian is the kind of guy who if he thinks it’s a good idea actually starts to work on it,” says Hartman. “He doesn’t have an ego about it. He doesn’t care whose idea it is; he does it.” Meanwhile, new construction is roaring back. “In the last two months, we’ve seen more new construction than all of last year,” Rist says, though he notes that much of it is in luxury homes. Although new construction is picking up, it’s nowhere near where it was during the boom. Rist estimates new construction is about 12% of his business today, compared to the majority during the boom. Yet Rist says he’s not keen to return to the boom years when he wasn’t so diversified. In any case, Rist isn’t waiting for the next big hurricane. “The next major storm will be the energy storm,” he says. “Nobody believes the cost of energy will decline.” Follow Jean Gruss on Twitter @Jean Gruss

Revenues Year 2010 2011 2012

Revenue %growth $10.6 million $11.8 million 11% $12.5 million 6%

$13 million 12

$12.5 million

11 10

2010

’11

’12

Employees 2010

2011

105

2012

110

Source: Smart Companies

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BusinessObserverFL.com

Entrepreneur er o W in n lion t

il $15 m illion 0 5 $ mk Gordon

r g By Ma y Managin t u p e r D Edito

of the Year

Fit to Grow

Mark Wemple

Parks Robinson, left, and his father, Bill Robinson, founded Fit2Run in 2005. The chain now has eight stores nationwide.

A father-son business partnership started small, but has since found its stride. They have ambitious growth targets.

ill Robinson had been out of the specialty athletic footwear retail business for nearly 15 years when his son, Parks Robinson, reeled him back in. That was in 2005, when the father and son launched Fit2Run. The idea was to build a chain of stores that put a premium on personalized customer service and offered a smorgasbord of athletic gear and equipment for all levels of athletes. “It’s like a candy store for runners,” says Bill Robinson. “If anybody has it, we have it.” The chain, with a corporate headquarters in Parrish, in north Manatee County, also has some fast growth. It has eight stores, including one at Coconut Point in Estero that opened earlier this year and another location, at the Dadeland Mall in Miami, which opened in April. Other stores are in Gainesville, Orlando, SarasotaBradenton, St. Petersburg, Tampa and Wellington. Combined annual sales at those stores have grown 183% since 2010, from $6 million to $17 million

in 2012. “The company is in a good position now,” says Bill Robinson, and both father and son agree: A target of 50 stores, at an undetermined date, is an achievable, albeit wild and crazy, goal. Yet Bill Robinson says Fit2Run’s success is somewhat of a surprise, at least considering the first year or two, when the business struggled to get inventory. And Robinson says a diverse product list, that includes rare items, is the best formula for success in the sporting goods industry. “Starting from scratch,” says Robinson, “was very difficult.” The elder Robinson, however, tracked down an Asics salesman he knew from the 1980s, which got the company going. Fit2Run has since added dozens more products, in ad-

“”

dition to a series of features to meet customer demand. Now the specially trained staff at each store tests and scans customer’s feet to perform a gait analysis and find the right shoe. Athletic specialty retail was the obvious choice when the Robinsons launched a business together because sports has played a key part in each entrepreneur’s life. Parks Robinson played college baseball at the University of Georgia and Valdosta State University. “I always thought I would be a professional athlete,” says Parks Robinson, who sold shoes at the Nordstrom in Tampa before Fit2Run. Bill Robinson’s father, meanwhile, H.L. Robinson, founded Robby’s Sports in Bradenton in the 1960s along with Bill Robinson’s brother, Penny Robinson. That chain, partial-

Conflict doesn’t necessarily mean bad. Conflict means creativity. Bill Robinson | Fit2Run

Revenues

Employees

Year Revenue %growth

$20 million

2010

$6 million

2011

$11 million

83.3%

2012

$17 million

54.5%

2010

2011

110

2012

140

$17 million 2010

’11

’12

Source: Fit2Run

VIDEO Hear how the Robinsons make a family business fit to function at BusinessObserverFL.com. ly under Bill Robinson’s leadership, became one of the largest athletic retailers in the country, with 49 stores and $70 million in annual sales. The Robinson family sold the business to the Woolworth Co. in 1988 and Bill Robinson stayed on to run the business, now Champs Sports, for three years. Bill Robinson oversaw massive national expansion with the company, but he ultimately decided corporate life didn’t fit. So Bill Robinson left Champs in 1991 and switched industries. He ran a successful tree farm, which grew to $12 million in annual sales, and he got into commercial real estate. Bill Robinson sold the tree farm business to John Deere around the time Parks Robinson, 31, came to his father with the idea for Fit2Run. Bill Robinson, 63, says he has no retirement plans and he loves coming to work every day, but the business, for the most part, is Parks Robinson’s to run. “My role is to pass on what I know to Parks,” says Bill Robinson. “Parks is a unique son in that he listens. He takes things in, he thinks about it and he makes his own decisions.” Of course, like any father-son duo, the Robinsons don’t always agree with each other. “But conflict doesn’t necessarily mean bad,” says Bill Robinson. “Conflict means creativity.” Follow Mark Gordon on Twitter @markigordon

BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

Entrepreneur of the Year

W in n

n to $15 millio n $50 millio ci

a By Tr Beach n a l il McM tributor Con

IT Biz Wiz

MARK WEMPLE

Matt Nachtrab, CEO of LabTech, says one of his biggest challenges is recruiting experienced IT talent to move to Tampa because LabTech is growing too fast to train people. His directors spend nearly 25% of their time recruiting and interviewing candidates.

When Matt Nachtrab realized other IT systems managers had an interest in his homegrown remote management software, he knew he had a market. Now he pulls business from the big boys.

n 2010, Matt Nachtrab and his five-person software company were faced with a difficult decision. Nachtrab always wanted to have full control of his business, but he was invited to partner his IT systems remote-monitoring and management software with ConnectWise, a provider of professional IT services automation software. The partnership would mean diluting ownership and ultimately losing some of the control. “We took a leap of faith with Connectwise,” says the 37-year-old CEO of LabTech. So the company moved from Toledo, Ohio, to Tampa in February 2010. “At this point, I know it was a good decision, but at the time, it was like going on a blind date.” The strategic partnership provided the fuel for LabTech’s growth. Over the last three years, the company has grown from 59 employees to its current 210, and to more than $23 million in revenue. The partnership, which

was an exchange of an undisclosed amount of cash for equity, has faired well for ConnectWise as well, as it has grown from 75 to 240 employees. “Actually partnering with someone in the industry, the amount of synergies was astronomical. That’s what exploded,” Nachtrab says. Since he was 14 years old applying for his own vendor’s license to sell baseball cards, Nachtrab has always been interested in running his own business. “I like building businesses; I like building things,” Nachtrab says. With a bachelor’s in electrical engineering and computer science from Vanderbilt University and an M.B.A. from Indiana’s Kelley School of Business, he has used the coupling of a technology background and business know-how to make ideas a reality. In 2000, one unlikely opportunity came along, when Nachtrab’s father’s company was in dire need of IT systems support. Nachtrab, who was working full-time in IT, partnered with his neighborhood friend, Drew McCallum, to help his dad. From this first client, McCallum and Nachtrab formed Nemsys, which provides services for companies that want to out-

Revenues

source their IT needs. In 2005, Nachtrab started to see a gap in their business. Managing IT for a number of small businesses was difficult; the tools available to remotely monitor IT for big businesses didn’t support managing multiple systems and networks. So Nemsys hired a programmer to develop software that allowed them to monitor many small businesses’ IT remotely. Greg Buerk, a Toledo programmer, developed a similar program after seeing Nemsys’ software. In 2008, Buerk went to Nachtrab to pitch his finished product, which Nachtrab realized was much bigger than Nemsys. Nachtrab then formed LabTech Software LLC with McCallum and Buerk. Using Buerk’s software, LabTech offers a way for IT outsourcing companies to monitor and troubleshoot their clients’ systems remotely. This makes IT providers more efficient and allows them to help clients more easily from a distance. Nachtrab emptied his personal and business checking accounts, created a website, and bought Google advertising and a tradeshow booth. “Before I knew it, we were getting leads

Employees

Year Revenue %growth 2010

$2.46 million

2011

$12.68 million

415.44%

2012

$23.09 million

82.10%

$25 million

2010

$23.09 million

5 2010

’11

2011

108

2012

152

’12 Source: LabTech

around the world,” Nachtrab says. LabTech’s first big sale was to a Netherlands-based company. The customer emailed Nachtrab 45 questions about the software. The next day, after receiving answers and a quote, the man wired a check for $10,000. “That was the moment when I realized, holy shit, if I can do this once, I can do it a thousand times,” Nachtrab says. Within the year, LabTech passed Nemsys in revenues. Analyzing his competition, Nachtrab offered LabTech at a lower price to make the product more affordable for small business. He also began to build strategic partnerships with complementary products that he could integrate into his software, including ConnectWise’s professional services automation (PSA) software. He continues to build partnerships with other PSA providers, to gain a bigger share of the European market where ConnectWise doesn’t have a large presence. Nachtrab forecasts the main generators of growth through 2014 will be from international expansion and partner add-on sales, building off the revenue from existing accounts. For 2015, he wants to leverage his current market to bring his product to IT departments, moving LabTech one step closer to the end-user. Both Nachtrab and McCallum continue to own Nemsys today, which has helped them develop LabTech’s services. “We are our own customers,” McCallum says. “We continue to eat our own dog food, so we understand the challenges our partners face on a day-to-day basis.”

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

WATCH THIS

Entrepreneur

A trio of entrepreneurs weathered the downturn by making strategic acquisitions and targeting customers in another part of the country.

f you want to install an Imax theater inside your house (price: $2 million), give Joe Hieronimus and Dan Robbins a call. They’re among a handful of dealers who can handle this task.

Or maybe you need to wire a commercial office building for lighting and security. Paul Caruso can help you with that. The three entrepreneurs have been installing electronic systems inside commercial buildings and luxury homes for decades, and they’ve always been successful, even in recent years. “We’ve grown in the worst of the worst economic times,” says Robbins. Caruso, 47, Hieronimus, 54, and Robbins, 60, are co-owners of Pittsburghbased Accent Electronic Systems Integrators and sister company Naples-based Advanced Electronic Systems Integrators. Accent ESI manages commercial customers while Advanced takes care of residential customers; the companies split into two entities last year, but they reported combined revenues of $22.5 million, up 22% from the prior year when they both operated under the Accent banner. Success came because the trio made timely acquisitions of struggling competitors in 2008 and because they targeted commercial work in Pennsylvania and Ohio, two areas not nearly as impacted by the real estate downturn as Southwest Florida. “Acquisitions were a part of the strategy, particularly in Southwest Florida,” says Caruso. “Our competitors were hurting a little bit.” In Naples, for example, Accent acquired Blue Kangaroo, a decade-old firm that

BusinessObserverFL.com

installed home-technology systems in high-end homes. These systems included home theaters, temperature control, surveillance systems, and computer networks. “There are some economies to being bigger so you can become more aggressive when there are fewer projects,” Caruso says. But the trio still plans to grow their business and make more acquisitions, though the challenge now is finding willing sellers. “Our M.O. is to find the right guy,” Hieronimus says. Meanwhile, as business was slowing in Southwest Florida during the downturn, the partners decided to focus on commercial projects in the Pittsburgh area. The Pittsburgh natives had done business there for years, operating prior companies that they later sold. “We started in Dan’s basement in 1978,” chuckles Hieronimus. Caruso, who oversees the Pittsburgh operations, says Accent has found a growing niche wiring schools and universities. Increasingly, campuses are seeking surveillance and security systems to protect against criminals and violent intruders. Bootstrapping young companies is what the trio likes to do. “You get to the point that you don’t enjoy what you do,” says Robbins. At one point, their prior company had 75 offices, 500 employees and was posting $75 million in annual sales. Each of the owners has a particular strength. “Joe is more of our strategic guy; he is our planner,” says Caruso, whose expertise is commercial sales. Robbins is the operations man and the one who owns the boat when they get together on the water. “I’m the best golfer,” laughs Caruso. Follow Jean Gruss on Twitter @JeanGruss

of the

er o W in n io l nt

il $15 m illion $50 m russ

Year

an G By Je or/Lee- Edit ier Coll

Nancy Denike

ABOVE: Daniel Robbins and Joe Hieronimus, owners of Advanced Electronic Systems Integrators in Naples, install home movie theaters and other electronics in luxury homes. Paul Caruso (inset) manages the commercial operations of Accent Electronic Systems Integrators in Pittsburgh.

Employees

Revenues Year 2010 2011 2012

Julia Rendleman

Revenue %growth $14.5 million $18.4 million 27% $22.5 million 22%

$25 million 20

2010

2011

2012

100

$22.5 million

120

2010

’11

’12

Source: Accent ESI and Advanced ESI

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BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

obby Harris is running pedal-to-the-metal, fullspeed ahead, to use trucking slang.

Entrepreneur of the Year

er Winnlion +

il $50 m t Leiser ne or By Ja ribut Cont

Mark Wemple

Bobby Harris founded BlueGrace Logistics, named after the middle names of his two daughters, after DHL exited the U.S. in 2008. As a reseller of DHL services, he developed software to help companies reduce shipping costs.

Full Speed

Ahead

While the recession could have put Bobby Harris out of business, he shifted gears to a new idea that came with some serious growth. Revenues

Employees

Year Revenue %growth

$100 million

2010

$38.6 million

2011

$63.6 million

64.77%

2012

$88.9 million

39.78%

60 20

$88.9 million 2010

’11

2011

2012

108

’12 Source: BlueGrace Logistics

He has gone from dock worker at a trucking company following high school to founder and CEO of the 20th fastestgrowing company on the Inc. 500 with 7,387% revenue growth between 2008 and 2011. Riverview-based BlueGrace Logistics, a third-party freight and logistics provider, is on target to hit $120 million this year, with revenue projected to triple in the next two to three years. At times, the ride has been bumpy and unpredictable. Five years ago, the entrepreneur owned 23 United Shipping Solutions franchises, a reseller of DHL services, and he was in the process of buying the franchisor. Collectively the franchises had about $8 million in annual sales. “It was a very successful company. Everything was looking up,” says Harris. But then DHL’s parent company announced it was exiting the U.S. market, citing steep losses tied to the economic recession. “It was scary. A lot of people were depending on me,” he says. It didn’t take Harris, now 39, long to recognize a new opportunity. Managing shipping costs is crucial to the survival of companies that regularly ship goods. For some businesses, it’s the second highest expense following labor, he says. Harris had created BlueGrace Logistics (the middle names of his two daughters) to hold the intellectual property rights to technology developed for his shipping company. His team refined the software to enable small- and mid-sized companies to find the most affordable trucking carrier by using a computer search similar to Orbitz. Instead of calling 20 or 30 companies for shipping quotes, the software provides an answer in 20 seconds. It also tracks shipments and consolidates the entire process. BlueGrace had $18 million in revenue in 2009, its first full year of operation. Harris, who grew up in Brandon and graduated from the University of South Florida with a bachelor’s degree in psychology in 2010, speaks modestly of his success. He says his company is successful because it helps other businesses operate more efficiently by simplifying shipping. Still, the company faces stiff competition. But “there’s always a market for the best,” says Harris. Key to BlueGrace’s success is Harris’s executive team, which includes inhouse legal counsel. Harris also cites the company’s corporate culture: Management is committed to treating all employees fairly and making BlueGrace a fun place to work. Management is also committed to hiring empathetic, creative people who want to serve customers. “My thing is to let people be themselves. We like odd people,” he says. “We’re a little eccentric.” On Fridays, the company offers free beer at 4 p.m. It’s no surprise those lines are usually long. The company has an open social media policy, which means employees are encouraged to use Facebook, Twitter and LinkedIn as work permits. The open social media policy enables Harris to keep up with the lives of his 140 plus employees through Twitter. Harris has his own Twitter account, @Bobbybg_CEO. His Twitter home page proudly proclaims: “Actively living 20 lifetimes in one and enjoying every second.” About half of the company’s revenue comes from its 35 franchises and Harris expects franchise growth to continue as BlueGrace expands its geographic reach. Selling to start over isn’t in his plan book. “I don’t want to sell my company,” he says. “I just want to keep making it great. I have a lot of fun doing what I do. I stay creative, very flexible.”

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

Ghost Buster The son of Cuban immigrants, Carlos Beruff overcame a poor childhood to find long-term success in homebuilding. Annual sales, near $60 million, are at an all-time high.

he ledger was so dreadful at Medallion Homes in the early 1990s that founder and owner Carlos Beruff admits he should have filed for bankruptcy — business and personal.

But Beruff held steadfast, he says, primarily for one reason: Sheer stubbornness, a tenacity likely handed down from his mother, who fled Fidel Castro-led Cuba a few years before he was born. The resolve ultimately paid off. The Manatee County-based company still stands today and is on its best three-year run of home sales ever. Plus, Beruff learned a valuable entrepreneurial lesson, that liquidity trumps all other worries. “I was young and immature and didn’t realize that when a business gets difficult the only people who survive are the people with cash,” Beruff says. “It also taught me how to be extra careful and to take risks with my own money, not other people’s money.” Those principles are what guide Medallion Homes, where sales increased 74% since 2010, from $32.8 million to $56.9 million in 2012. Annual revenues based strictly on home sales, not including land deals, are at an all-time high. A Miami native, Beruff founded Medallion in 1984, after a short but successful stint selling houses for U.S. Homes. Living

BusinessObserverFL.com

in Tampa in 1980, Beruff recalls he saw a newspaper ad that sought home salesmen in Sarasota. The pay was $3,000 a month, plus commissions. That salary sounded dreamy to Beruff. His family, including his Cuban-born older sister and brother, struggled to get by for several years. Beruff says they would pick up government-sponsored food every Saturday, such as surplus cornmeal. Beruff, his siblings, his mom, his aunt and some cousins, eight people total, all lived in a two-car converted garage for a few years. Yet Beruff grew up determined, not bitter. “When you’re a kid,” he says, “you don’t know you’re poor. I never went hungry.” Beruff founded Medallion basically on a hunch, when he bought 22 lots on Tallevast Road and Tuttle Avenue in Manatee County. He paid for the lots with a $120,000 bank loan that came with a two-year term. Beruff paid it back in eight months. The next big turning point for Medallion Homes came in 2005. That’s when Beruff decided to sell five projects to national builders, a purge of lots and land that lasted 18 months and brought in $110 million. Beruff says he sold because the financials of the homebuilding industry had gotten out of whack. Specifically, he believed a key rule in the industry was being shredded, that the price of a lot shouldn’t exceed 20% of the sale price of the home. If it does, Beruff had learned, then profits would likely evaporate. Cash from those deals was Beruff’s

Entrepreneur of the

er Winnlion +

il $50 m Gordon

Year

rk By Ma Managing y t u p De r edito

Mark Wemple

Carlos Beruff founded Manatee County-based Medallion Homes in 1984. Revenues at the firm are up 73% since 2010, from $32.8 million to $56.9 million in 2012. downturn savior, and it gave him the ability to buy lots in the recovery. “Now I look like a genius,” says Beruff. “But as it was happening, that’s not what I thought.” Beruff’s thoughts now have turned to the future, and how he will manage a fastgrowth business. Beruff is determined to not let growth negate the firm’s customer service. Beruff is also determined to remember another key lesson he learned 30 years ago, second only to having enough liquidity. The lesson: That success in homebuilding is predicated on getting people to see homes. He says if three out of 100 prospects buy a home, that’s good, and if four out of 100 buy one, that’s really good. “I worry about this business when I can’t get people to see my models,” Beruff says. “This business is driven by footsteps through the door. You can’t sell homes to ghosts.” Follow Mark Gordon on Twitter @markigordon

Revenues Year 2010 2011 2012

Revenue %growth $32.8 million $42.5 million 29.6% $56.9 million 33.8%

$60 million 50 40 30

$56.9 million 2010

’11

’12

Employees 2010

2011

2012

Source: Medallion Homes

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BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

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Entrepreneur er W in n

of the

+ illion $50 m n Gruss a By Je r/LeeEdito ier Coll

Year

Perfect Timng Brian Stock, the CEO of Stock Development, survived the residential housing downturn and has positioned his company for the rebounding recovery.

Brian Stock has been prescient about the economic cycle, timing the new-home market with uncanny success on the downside — and the upside.

n 2007, Brian Stock made a decision that saved his homebuilding and development company from the fate of many others in the homebuilding industry: He slashed prices by 35%. No one could have foreseen the real estate collapse that ensued, but Stock was earliest among builders in Southwest Florida to recognize what had to be done to survive. “It was always about keeping momentum,” says Stock, the 43-year-old CEO of Stock Development. This was no easy decision, because builders in 2007 predicted that the market’s softness was just a temporary setback. It would still be another year before the financial crisis erupted in 2008. In fact, rival builders grumbled that Stock was being too aggressive with its prices and refused to go along. When he faced residents of Stock

communities, such as Paseo in Fort Myers, residents there were upset about the devaluation. “One got up and slammed the door,” Stock remembers at a contentious community meeting with residents. But Stock stuck to his aggressive pricing strategy, arguing that communities had to maintain sales momentum or new development would come to a halt, slashing values even further. At the time, Stock had 350 unsold homes because many buyers walked away from their 20% deposits. As it was with the downturn, Stock has been prescient about the recovery. In 2010, when many builders

still weren’t sure the economy was rebounding, Stock cleared 240 acres at its Lely development in Naples. The company spent $15 million to clear the land and build models, including $6 million to dig lakes on the property. Soon after, Stock was able to boost prices 15% for the homes there that range in price from $400,000 to $1 million. Now, the momentum is building. To keep up with surging demand, Stock is building 140 speculative homes and another 46 models for the next home buying season. The company has a pipeline of 1,600 lots and is close to announcing plans to build in a ninth community in

“”

It was always about keeping momentum. Brian Stock | Stock Development

Revenues

Employees

Year Revenue %growth

$300 million

2010

250

2010

$178 million

2011

$201 million

13%

200

2012

$280 million

39%

150

249

2011

298

2012

298

$280 million 2010

’11

’12

Source: Stock Development

Southwest Florida. Part of Stock’s success is that its CEO is always on the job. For fun on weekends, Stock jumps into his car and visits homes and communities in Lee and Collier counties. “It’s not work to me,” Stock says. Stock’s father, K.C. Stock, says son Brian worked at his father’s construction-supply business in Green Bay, Wis., at age 13, loading lumber. “I made Brian go to work for a contractor,” says the elder Stock, who sold the construction-supply business and used the proceeds to finance Stock Development in Naples. Although he has a reputation as a good delegator, Stock says he enjoys getting into the finer details of the company. For example, he spent two hours with landscaping consultants one evening at Quail West recently, discussing the kinds of plants that needed to line the entrance to the residential development in North Naples. And Stock regularly discusses issues with community residents. For example, Stock redesigned the layout of 13 tennis courts at a cost of $2 million by moving the parking lot at The Players Club at Lely. Still, Stock’s open-door management policy doesn’t slow the decision-making process. “Brian’s always been able to make a quick decision,” says Claudine Léger-Wetzel, Stock’s vice president of sales and marketing. Follow Jean Gruss on Twitter @Jean Gruss

Brian Tietz

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

BusinessObserverFL.com

calendar

events

May 21

Legislative review: The Greater Tampa Chamber of Commerce will hold a meeting with state legislators from Hillsborough County to discuss the outcome of the 2013 legislative session. The meeting will run from 11:45 a.m. to 1:30 p.m. at the Embassy Suites Hotel Tampa-Downtown, 513 S. Florida Ave., Tampa. Cost is $45 per person and $50 for others. For more information visit tampachamber.com.

May 22

Medical management: Gwen MacKenzie, CEO of Sarasota Memorial Hospital, will speak at The Argus Foundation’s Meet the Minds meeting. She will discuss the role of public hospitals in a changing medical and political environment. The meeting will start at 11:30 a.m. at The Franchise Ball Room, Mackenzie 1289 Palm Ave., Sarasota. Cost is $30 per person. For more information contact Sharlene at 941-365-4886 or email shill9448@aol.com. Legislative update: Florida State Sen. President Pro Tempore Garrett Richter and other area legislators will speak about the recent state legislative session at an Urban Land Institute meeting. The event will run from 8 a.m. to 10:30 a.m. at The Club at Grandezza, 11481 Grand Oak Richter Blvd., Estero. Cost is $35 for members and $45 for others. For more information call 800-321-5011 and mention 8118-1313.

June 25

Smart data: Moez Limayem, dean of the University of South Florida College of Business, will discuss how organizations use data to outperform competitors at a Greater Tampa Chamber of Commerce Competitive Edge Series meeting. The event will run from 11:45 a.m. to 1:15 p.m. at the chamber’s offices, 201 Limayem N. Franklin St., Tampa. Cost is $35 for members and $50 for others. For more information visit tampachamber.com.

July 17

Atwater speaks: Jeff Atwater, chief financial officer of Florida, will speak at Greater Tampa Chamber of Commerce meeting. The event will run from 7:30 a.m. to 9 a.m. at The Tampa Club, 101 E. Kennedy Blvd., Tampa. Cost is $35 for memAtwater bers and $40 for others. For more information visit tampachamber.com.

September 12

Economic development: The Economic Development Corp. of Sarasota County will hold its annual meeting from 11:30 a.m. to 1:30 p.m. at the Hyatt Regency, 1000 Boulevard of the Arts, Sarasota. For more information visit edcsarasotacounty.com.

The best way to celebrate is to elevate. Schifino Lee w i l l c o n t i n u o u s l y c re a t e n e w t h i n g s t h a t t r a n s f o r m l i v e s a n d b u s i n e s s e s t o m a k e a p o s i t i v e d i ff e re n c e . O n w a rd . U p w a rd . O n e w o rd : U n s t o p p a b l e .

June 4

Economic summit: Anirban Basu, chief economist for the Associated Builders and Contractors, will be the keynote speaker at the CREW Tampa Bay’s annual economic summit. The event, which will also feature the mayors of Tampa, Clearwater and St. Petersburg, starts at 11:30 a.m. at Basu the Sheraton Riverwalk Tampa, 200 N. Ashley Drive, Tampa. For more information visit crewtampabay.org.

October 11

Meet the directors: The Florida Directors’ Institute will hold an all-day program for directors of public and large private companies at The University of Tampa, Vaughn Center, Ninth Floor, 401 W. Kennedy Blvd., Tampa. For more information visit ut.edu/centers/fdi.

June 6 and 7

November 7-9

Tourism conference: The Ringling College of Art and Design will host a three-day second annual international tourism conference on its campus to focus on service design. For more information visit servicedesigntourism.com.

S C H I F I N O L E E . B E U N S T O P PA B L E .

schifinolee.com

110865

Real estate summit: Jeb Bush will be the keynote speaker at the Urban Land Institute’s statewide real estate summit at The Ritz-Carlton, 280 Vanderbilt Beach Road, Naples. Cost is $395 for private sector ULI members. For more information visit uliFloridaSummit.org. Bush

BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

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Entrepreneur of the

er Winn13 20

aci By Tr lan il M c M h Beac tor u ib r t Con

Year

Third Time’s

A Charm MARK WEMPLE

Steve MacDonald, chairman and chief executive officer of myMatrixx, built the workers’ compensation industry’s first Web-based pharmacy management system. Today, myMatrixx owns an in-house online pharmacy that ships medications directly to those injured on the job.

It took Steve MacDonald more than one try to get it right. But in the world of entrepreneurs, persistence is a prerequisite.

ince he set out on his own nearly 15 years ago, Steve MacDonald failed in one business he began, and promptly started another — only to later be fired from it. But now, armed with somewhat painful yet powerful lessons, he’s running a business the way he’s always wanted to with his current company, myMatrixx. myMatrix x, which had $72.84 million in revenue in 2012 and has more than 140 employees, specializes in providing services for workers’ compensation benefits. This includes everything from medications and home nursing services to medical equipment. But the

scalable key to the company’s fast growth is how it does this: It provides an interface to streamline the payment processing system to “make sure patients are getting the services they need in the timeline they need them,” MacDonald says. The company negotiates discounts for medications and supplies, while at t he sa me time monitoring activity for insurance companies to help its clients, who are mostly self-insured employers. It serves as a “safety net,” checking to find if there are indications of fraud, abuse, or overutilization of workers’ compensation, MacDonald says. It varies by state, but typical cost savings from using myMatrixx is around 30-35%, according to his figures. The company, which made the Inc. 5,000 list four years in a row,

Revenues Year

$49.03 million

2011

$59.34 million

2012

$72.84 million

core values

A GREAT IDEA MacDonald, 45, started his career working for someone else, at PMSI (at the time, Pharmerica), a pharmacy and medical services company serving the workers’ compensation population. He worked his way up from sales to running the firm’s Catastrophic division. In 1999, MacDonald pitched a business plan for moving his division’s offerings online to automate its processes, but was shot down by board members

who didn’t see the Internet becoming a popular household tool. “I saw the world differently at that moment,” MacDonald admits. “So I told my boss, ‘I’d love to do this here, but if you’re not going to do it here, then I’m going to start my own company.’” MacDonald turned his idea into AccessLife, the first online portal for individuals suffering from brain and spinal cord injuries to share information and resources, and order medical supplies or medications. The software also featured an ancillary medical service that helped “process insurance claims and manage distribution for the products the patients ordered,” according to the company. To raise capital for his venture, MacDonald never asked people for money, but always asked for advice. Often, he found advice sessions over a cup of coffee would lead to an investment. MacDonald and his

Employees

Revenue %growth

2010

has more than 400 clients, with a client retention rate nearing 99%. Since beginning in 2001, only two clients have left the company, and one is planning to come back after a two-year stint with a competitor. It has grown by more than 20% each of the past two years, a trajectory MacDonald plans on continuing.

21% 23%

$80 million

2010

$72.84 million 40

2010

’11

2011

103

2012

143

’12 Source: myMatrixx

• Do the right thing • Respond with care • Serve with passion • Innovate constantly • Love to learn

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

BusinessObserverFL.com

Macdonald’s ADVICE for ENTREPRENEURS 1. Trust your gut. It’s easy to make decisions with your head and not with your gut. Don’t let yourself get talked into making a decision that doesn’t feel right. 2. Don’t hire a business-plan writer. If you are knowledgeable about your idea, you can put together an executive summary that is two to three pages max. 3. If you’re not in a CEO group or peer group, join one. Examples in the area include Vistage, YPO, and the Tampa Bay CEO Council. You can also form your own small group (around eight people) and meet monthly without fail. You want to gain valuable advice from people you trust – so pick this group wisely. business partner raised more than $5 million through this kind of networking and were able to persuade actor Christopher Reeve to join the board of directors. Like many Internet startups in 1999, the company burned through the $5 million quickly, and MacDonald was forced to shut down the AccessLife portal and lay off 60 people. “In some degree it was a big public disaster,” MacDonald admits. He decided to focus on TechHealth, the commercial aspect of the software they built. Having lost all of his investors, MacDonald’s business partner and a previous boss both took a risk and wrote checks to keep TechHealth up and running. The company landed a deal with Blue Cross Blue Shield, which attracted new investors who provided $1.5 million in funding. To secure the last round of financing, the investors told MacDonald

“”

4. Optimize a person’s potential. Focus on what people do well and try to exploit that. It creates a great relationship dynamic and people will go to the moon for you. 5. Be persistent. You get a lot of no’s along the way, and it’s easy to get discouraged. You have to keep going and keep believing. 6. Create “Oh wow” factors in your demo. Develop something that will make people say, “Oh, wow!” 7. Enjoy the ride. There’s a lot of ups and downs. It’s not always easy, but you’ve gotta enjoy the ride.

Servicing smaller customers also allowed him to learn from them and improve the business. He hand-delivered invoices, taking the opportunity to talk with clients and ask them what he could do better and what would make their jobs easier. This set the foundation for myMatrixx: offering superior customer service for technology that streamlined how customers processed workers’ compensation pharmacy claims. Eventually the small customers led to larger ones, and as the business grew, MacDonald took another approach to build growth — he recruited top talent. By hiring well-known names in the industry, he was able to cement myMatrixx’s legitimacy and also take advantage of the knowledge and relationships the new employees brought with them. The approach led to steady — and large — growth. In 2001, his first year, he had $267,000 in revenues.

You just have to keep going, just don’t stop. You never know, but one thing is certain: if you don’t keep trying, you’ll keep failing. Steve MacDonald | myMatrixx

he’d have to fire his business partner. “A lesson for other entrepreneurs,” MacDonald says, “When you fire your votes on the board, then that leaves you a sitting duck. So I was the next to go.” MacDonald and his partner were both fired from the company they founded, losing the software program he developed. MacDonald considers it the best thing that ever happened to him. New and Improved In 2001, while sorting out a settlement in court with the TechHealth investors, MacDona ld was approached by Ron Warble, of Brown & Brown’s Amerisys. “If you could build me a (customized online) pharmacy program, I’ll be your best customer,” Warble said. MacDonald decided to give it a shot. He knew if he could build it, he could market it to others. After borrowing $5,000 from his father and $5,000 from a friend, he found a partner to help with startup costs and used the last $20,000 he had to hire a programmer to build the first version of the myMatrixx software. Working out of the back of a warehouse with a college student answering the phone (who is now a vice president with the company), MacDonald started “dialing for dollars,” looking for clients. For the next two-and-ahalf years, MacDonald didn’t take a salary. Instead, he reinvested whatever small profits the business made. At first, MacDonald had a hard time persuading customers that his small startup could handle their workers’ compensation needs. He focused on getting the clients his competitors didn’t want: small to mid-sized municipalities and school boards. MacDonald says he wanted to get as many customers as possible, no matter how tiny the deal.

Three years later, in 2004, he had nearly $6 million in sales. But as the business took off, the relationship with his partner started to deteriorate. “He was a great guy… he gave me the confidence that I could bootstrap something,” MacDonald says. But the two had different visions for the company. In 2005, a private equity firm bought his partner’s shares for $3.5 million, but MacDonald learned from his previous business that he wanted control. He met Tom Cardy (now myMatrixx’s CFO) through a connection at his CEO peer group, and together they created a financing deal that would allow MacDonald to gain 81% ownership by raising $1 million of equity and $2.5 million of long- and short-term debt. With sales continuing to climb, MacDonald paid off the debt in three years. Building a Team MacDonald attributes a large amount of myMatrixx’s success to the company’s ability to innovate. To do this, MacDonald says it’s all about having the right people. With the company experiencing such fast growth, MacDonald elicited the help of Mary Key, a consultant with CEO Florida Forums. Key says one of MacDonald’s key concerns was maintaining the company’s culture, so she worked with him to create core values for the firm. These values guide the company not only in what it does, but also in whom it hires. MacDonald says the first thing a manager should look for is whether or not a person is willing to learn. “If

a person is humble enough to learn, then they’re usually humble enough to be a coworker,” he says. myMatrixx candidates have to pass the culture test first, and an aptitude test second. “There seems to be no limit to his abilities in regards to people and bringing the right team together to accomplish the goal,” says Mike Bunkley, myMatrixx’s senior vice president of business development. “He knows what he wants, and he knows how he’ll get there.” “He knows what he knows,” says Cardy. “He gets very good people to do what he doesn’t know, and he gives them free reins.” But he’s also impatient. “You have to get things done. You can’t wait around,” Cardy adds. MacDonald’s belief in constant improvement shows itself on the sales side, with what he calls “Oh wow” factors to pitch to customers. His current “wow” factor is myMatrixx’s mobile app, which allows patients to access ID cards, look up the names of their prescriptions and see the status of their drug fulfillment, so they don’t have to wait at the pharmacy for the insurance to send an approval. The app notifies the client if prescriptions or services are not covered under typical guidelines and need approval from the insurance company. Field adjusters and nurse case managers can also leverage the app to communicate or order necessary supplies directly from their phones. MacDonald embraces the fact that his company is “young and innovative, offering the solutions that older legacy companies are not offering,” he says. He asks companies to take a risk, rather than playing it safe by sticking with what they know. He dresses the part, too. Typically clad in casual attire like jeans and a cotton shirt, his director of marketing had to beg him to wear a tuxedo to the 2012 Ernst & Young Entrepreneur of the Year Awards, for which he was nominated. Out of his competition – PMSI, Healthesystems, TechHealth, Progressive Medical, Express Scripts, and CyberCare – four are in Tampa, one is his previous employer, and one is the company he founded. MacDonald’s next step to stay ahead is a service that uses business intelligence and data analytics to demonstrate predictive outcomes that will help insurance companies spot problems and intervene more quickly. True to his passion for innovation, last year MacDonald launched a second company, MamaBear, a mobile app to help parents keep kids safe by monitoring social media. The app rolled out in 2012 as a free subscription and is currently at 30,000 downloads, with its fair share of national media attention. MacDonald says it’s just another way for him to be creative and enjoy the process of invention. “You just have to keep going, just don’t stop,” MacDonald says. “You never know, but one thing is certain: if you don’t keep trying, you’ll keep failing.”

VIDEO Hear more of MacDonald’s entrepreneurial story at BusinessObserverFL.com.

TIMELINE 1990: Graduates from University of South Florida with degree in accounting, begins work at PMSI (later became a division of Pharmerica)

1999: Pitches online product to PMSI, but idea is shot down. Quits PMSI to start his own business. Launches AccessLife, an online community for individuals suffering from spinal cord and traumatic brain injuries. 2000: Shuts down AccessLife, lays off 60 employees Develops TechHealth out of AccessLife 2001: Fired from TechHealth. In August, asked develop Web-based claims processing system (myMatrixx) for AmeriSys (a division of Brown & Brown). Launched Matrix Healthcare Services Inc. now doing business as myMatrixx, a pharmacy benefit manager.

2004: Takes first paycheck from myMatrixx (2.5 years after inception)

2005: When his partner exits the business, MacDonald takes out personal loan with help of a small group of investors to avoid losing control of the company.

2008: Repays loan (took three years to pay out completely) First year to appear on Inc. 5000 list (appears in 2008, 2009, 2010, 2011, 2012)

2011: myMatrixx office opens in Austin, Texas

2012: Launches MamaBear, a parenting mobile app Business Insurance Magazine names myMatrixx one of the Best Places to Work in Insurance nationwide 2013: CNBC names MamaBear one of Top 25 most promising startups in the world. Launches myMatrixx Mobile, the first tool in workers’ compensation that allows claims professionals and patients to access their data from a smart phone.

BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

kept ic s somet i mes creep up on Mark Pentecost and jab him with a disbelieving frown.

Entrepreneur of the Year

erW in n O S TA

SARAENTON BRAD GORDON By MARKPUT Y DE GING MANA R IT D E O

Mark Pentecost founded It Works Global in Grand Rapids, Mich., in 2001. The firm moved to Bradenton in 2011.

Mark Wemple

WORK

Doubters and disbelievers beware: Mark Pentecost has proven everyone wrong before. He plans to do it again, real soon.

Revenues

Employees

Year Revenue %growth

$200 million

2010

$29 million

2011

$45 million

55%

2012

$200 million

344%

100

$200 million 2010

’11

’12

2011

2012

Source: It Works Global

That’s not a total surprise, especially considering Pentecost’s firm has had some colossal growth recently, like a 590% increase in annual revenues, from $29 million in 2010 to $200 million in 2012. That makes the company, Bradenton-based It Works Global, one of the biggest, and fastest growing, privately held firms in the SarasotaBradenton region. The firm had $1 million in sales in one day in March, a first-time feat. Then it did it several more times in April, when it set a monthly sales record at $45 million. More than 300,000 people have bought its products, and the firm has 50,000 independent distributors worldwide. “It’s going crazy here,” says Pentecost. “We’re killing it. We’ve become a customer-generating machine.” Yet the skeptic script almost always repeats itself. Pentecost realizes some people doubt a local business, in a region that produces few gazelles, can really grow that much, that fast. Further, the firm’s flagship product — a cloth wrap infused with a botanically based cream that can tighten and tone a body and waist in 45 minutes or less — almost demands doubt. Pentecost, though, rarely takes offense to the uncertainty. He usually says something similar to what he told a stranger on a cruise in March who flat out asked him if “it really works?” Replies Pentecost: “I told her that after 11 years it has to, otherwise we should call the company, ‘It Doesn’t Work.’” It Works, instead, sells a line of wellness and health products, including the Ultimate Body Applicator wrap, through multi-level marketing. That business model, where a sales force earns money on sales and on the sales of other distributors they recruit into the network, has faced a bevy of its own skeptics. A prominent Wall Street investor, for example, recently alleged that Herbalife, a $4 billion multi-level marketing firm, is a pyramid scheme for relying on network recruitment, not product sales, to generate revenues. Herbalife, denies the allegations. But for all the skeptics, plenty of others consider multi-level marketing companies an entrepreneurial dream that’s minted many millionaires. The walls of It Works’ headquarters, a former concrete and building materials office, are filled with framed pictures of the people nationwide who have reached that seven-figure sales mark. It Works has 58 employees in the corporate office, which Pentecost plans to relocate to Palmetto, just north of downtown Bradenton, later this year. A chunk of the those employees moved to the region with Pentecost in early 2011, when he moved the company from Grand Rapids, Mich., where he founded it in 2001. Manatee County and Florida economic development officials dangled about $800,000 in performance-based incentives and tax refunds for It Works to move south. Now Pentecost says 2013 looks like it will be another strong growth year, with $500 million in sales a reasonable target. But the hyper-competitive Pentecost already looks past that mark, to what some consider the valley of death for large fast-growth businesses: The leap from $500 million to $1 billion. “You get to a certain level of sales and you think you don’t have any problems,” says Pentecost. “But you do. It’s just a new set of problems. Now we have high-class problems.”

Overcome challenges One of those dilemmas, says Pentecost, is the supply chain must keep up with the demand. That’s because the firm now has a line of skin care products and nutritional supplements — all sold under the direct-selling model. No products, from weight loss energy bars to a stretch mark moisturizing cream, are sold retail. Says Pentecost: “We

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER could sell as many products as we can get our hands on.” Pentecost also makes sure employees stay focused on small goals to build up to big successes. He constantly reminds employees that the firm can’t do everything. “It’s really easy to get distracted,” he says. “Our no’s mean as much as our yeses.” Pentecost admits he has to check himself, too, from overdoing it. “I’m a very competitive person. I’m always setting goals,” says Pentecost, a former high school teacher and basketball coach. “My biggest problem could be my competitiveness. I get obsessed with winning.”

“”

BusinessObserverFL.com

bills them after cancellation; and customers who say they didn’t know about a $50 cancellation fee. The firm earned an A- ranking from the bureau on an A+ through F scale. Pentecost says the complaints, while taken seriously, total less than 1% of the firm’s 350,000 monthly orders. Company spokeswoman Kate Martin adds that most of the bureau’s reports stem from termination fee issues, which can also be a misunderstanding. “We are currently reviewing the termination terms and system to improve our customer experience,” Martin says in an email response to questions about the Better Business Bureau grades.

You get to a certain level of sales and you think you don’t have any problems. But you do. It’s just a new set of problems. Now we have highclass problems. Mark Pentecost | It Works Global Another challenge for Pentecost is It Works has attracted complaints. For instance, the Better Business Bureau West Florida office, based in Clearwater, has received and closed 172 complaints on It Works Global in the last three years. The agency says it closed 108 complaints in the last year. The complaints, according to the bureau’s website, include allegations of customers who receive the wrong products; consumers who receive additional products after trying to cancel orders; consumers who say the firm

VIDEO Hear more on how Pentecost handles his firm’s big growth at BusinessObserverFL.com.

Tough love All the challenges, from complaints to supply chain, are the polar opposite of what Pentecost dealt with when he founded It Works. Pentecost was a teacher and coach back then, and he sold phone services at night through a multi-level marketing business. He had a passion for teaching and coaching. But Pentecost, who was born on a farm in Tennessee and grew up mostly in Michigan, also discovered he was a good salesman. His opportunity to prove it full-time came when heard about the It Works wrap from a friend, Pam Sowder. Pentecost and his wife, Cindy Pentecost, used the product, invented by Luis Mijares, a skin care scientist. They believed in it and started the business. Sowder and Mijares are executives

Mark of Success

with It Works today. Things started slowly. Pentecost invested $300,000 to $500,000 of Mark Pentecost, founder of It Works Global, his own money in the company, hasn’t shied away from enjoying the spoils and he and Cindy Pentecost took of success. His recent feats and purchases out a second mortgage to keep it include: afloat. “We didn’t pay much in the beginning,” Pentecost says. “We • In October 2010 he bought the 18-hole didn’t have much.” Stoneybrook Golf Club in east Manatee Now It Works has customers naCounty. Pentecost and his wife, Cindy Pentetionwide and in Australia, Canada cost, paid $3.5 million for the course, which and parts of Europe. The internais now where the firm holds training seminars tional division makes up about and events; 5% of the total business. • He bought a 340-acre ranch in Myakka City But while It Works has grown last year. He hunts, drives a four-wheeler substantially, one constant, say and generally pals around with employees people who know Pentecost, is and friends there; the founder’s ability to coach and • He attended the Masters Golf Tournament teach through tough love. and he played in a pro-am event at the Innis“He’s like a general you want to brook Resort and Golf Club in Palm Harbor, go to war with,” adds Don Hamwhere teamed up with 2003 U.S. Open winilton with the Grand Rapids office ner Jim Furyk. of Huntington Wealth Advisors, • A lifelong fan Michigan State athletics fan, who has been It Works’ banker Pentecost recently traveled with the school’s since its inception. “He’s the little basketball team on its team bus, for a game engine that can.” against Indiana University. Klein, Hamilton and others, in—Mark Gordon cluding It Works employee Zach Hesse, say Pentecost’s energy and competitive zeal also run unusuCounty property records. ally deep. Klein has seen it come Renovations, which Pentecost out when Pentecost plays cornhole, a beanbag toss game. Hesse has seen it says will cost another $3 million to on the golf course and in the board- $4 million, are already under way, with a possible completion of later room. “I’ve never seen anyone who doesn’t this year. Plans include the addition rest on his past like Mark,” says Hesse, of a glassed in outdoor fourth floor an assistant to Pentecost. “There is with a fire pit that will replicate a something about his drive. He just snazzy nightclub scene. Pentecost says that floor will be used for traingoes and goes and goes.” ing and entertaining the sales network. Another potential feature of Snazzy scene The next physical place Pentecost, the building: Pentecost says there and It Works, will go is into a new cor- will be a slide on at least one floor, instead of an elevator. porate headquarters. The plans, in general, scream fun That building, which Mark and Cindy Pentecost bought late last year, is over formal — which is just how Penon the Palmetto side of the Manatee tecost wants it. “I tell people I’m more River and was previously a health club Jimmy Buffett than Warren Buffett. and spa and a bar. The Pentecosts paid I’d rather be in sandals and shorts. We $3.13 million for the 36,000-square- like to have fun here, but we still take foot building, according to Manatee the work seriously.”

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BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

n December 2008, just as the crisis on Wall Street was raging, Sam Klepfish was staring at another financial disaster.

Entrepreneur of the

W in n L

Year

r ee- Collie uss an Gr By Je r/Leeo Edit ier Coll

PHOTOS BY NANCY DENIKE

Sam Klepfish, the CEO of Innovative Food Holdings, says chefs on staff have helped boost sales of fine foods to restaurants across the country.

The

chef executive Sam Klepfish is guiding the growth of gourmet-food purveyor Innovative Food Holdings with a team of trained chefs. Revenues

Employees

Year Revenue %growth

$20 million

2010

$9.9 million

2011

$11.6 million

17%

2012

$18.6 million

60%

2010

2011

2012

$18.6 million 2010

’11

’12

Source: Innovative Food Holdings

The firm in which he was a leading investor, Naples-based Innovative Food Holdings, had run out of cash in September of that year. “We had to put up money to make payroll,” Klepfish recalls. After scrambling for cash over the holidays in 2008, Klepfish found an investor who on Dec. 31 agreed to give the company a $200,000 loan. Without it, Klepfish says the company likely wouldn’t have survived the New Year. Today, it’s a different story. Innovative Food has $1.3 million in cash on its balance sheet, it has made strategic acquisitions that boosted revenues 60% last year and it recently purchased a new headquarters building in Bonita Springs for its rapidly expanding operations. The company reported it earned $2 million on revenues of $18.6 million last year, compared with net income of $1.5 million on revenues of $11.6 million in 2011. Innovative Food distributes 7,300 gourmet foods to thousands of upscale-restaurant chefs around the country and to gourmet-food aficionados via its online store ForTheGourmet.com. Products range from Kobe beef to heirloom tomatoes, fresh morel mushrooms and French cheeses. The unassuming headquarters of the company is tucked away in a nondescript office building near the last exit in Naples before Interstate 75 turns into Alligator Alley and into the Everglades. Klepfish, 41, seems a bit out of place on the edge of the swamp. The Brooklyn native and resident commutes to Naples regularly, but otherwise delegates the day-to-day operations to Justin Wiernasz, Innovative Food’s president and a veteran of the fooddistribution business. Wiernasz says the top question investors and others want to know is how he and Klepfish work together. “It’s based on trust and respect,” says Wiernasz. “One of Sam’s strengths is when he hires someone he trusts, he lets you go.” Klepfish is quick to help in a pinch, even answering the phones when he’s in Naples. “Sam will jump in for me,” says Z. Zackary Ziakas, better known in the office as Chef Z. Ziakas oversees the retail website, ForTheGourmet.com. But Klepfish says working from New York keeps him from slipping into micro managing. “If I was here all the time it would not be as effective,” he says. “I’m not the type of guy who pulls out the boss card.” When he does visit Naples, Klepfish brings a dry sense of humor to the office. “We’ve been growing so quickly, he brings levity to the situation,” says Wiernasz. “I don’t have to stress all the time.” banking background Trained in finance, Klepfish was working for law firm Phillips Nizer in New York City helping companies raise capital and make acquisitions. He joined the board of Innovative Food in 2004 as the company was about to acquire a pasta manufacturer. The pasta-company acquisition didn’t happen, but Klepfish remained on the board and became its CEO after the founder, Joe DiMaggio Jr., a Naples resident and relative of the famous baseball player, resigned. Klepfish now owns about 15% of the shares of the publicly traded company. At Phillips Nizer, Klepfish bridged the worlds of entrepreneurs and lawyers. “My approach is analytical and that’s how this business is run,” he says. “A good decision is if you have all the facts,” he says, because outcomes are often out of your hands. The risk-averse Klepfish says he often recalls his grandmother’s admonishment: “If you do something stupid and nothing bad happens, it doesn’t

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER make you smart.” Klepfish was confident of Innovative Food’s business model, which is to provide artisanal foods to upscalerestaurant chefs around the country. To do that, the company hires chefs who have grown tired of the kitchen. They answer the phones, help customers with their orders and make suggestions on how to use the products. “It gives you the ability to talk food without the grueling hours,” says Todd Carrell, a trained chef and executive vice president of sales and procurement. For example, edible hibiscus flowers are among the company’s hottest items. Chefs at Innovative Food explain how to use them to adorn champagne

“”

I’m not the type of guy who pulls out the boss card. Sam

Klepfish | Innovative Food Holdings

VIDEO Hear Klepfish’s must-have traits for entrepreneurs at BusinessObserverFL.com. flutes, slices of cheesecake or even skewers of shish kebab. “They’re looking for ideas,” Carrell says. Of course, few people go hungry in an office full of chefs. The company budgets for Fun Food Fridays when each chef at the company takes turns making a meal for everyone on the last day of the week. A recent breakfast included egg soufflé, coffee cake and bacon, and lunch was chicken chili soup and couscous salad. Everyone always tastes the new products that arrive. “Even on the finance

BusinessObserverFL.com

side they love food,” Carrell chuckles. The company goes to great lengths to secure gourmet foods for its customers. For example, when the U.S. slapped a 300% trade tariff on Roquefort cheese from France in 2009, Innovative Food stocked up with 2,000 pounds of the pungent cheese so it could keep its customers supplied at reasonable prices while the trade dispute was resolved. “It’s a great concept they have, bringing food from around the world and making it available to restaurateurs,” says Lou Haley, a veteran of the food distribution business whose consulting firm, The Haley Group, was recently acquired by Innovative Food. “Everyone is becoming foodies.” Klepfish is passionate about technology and the Innovative Food has automated its systems to track more than 100,000 shipments it makes every year, by FedEx and through giant distributor US Foods. For example, Innovative Food can create an order, arrange for a FedEx shipment and notify the customer in five minutes, says John McDonald, the company’s CIO. Shipments quadrupled, but the same two employees can manage the increased work because of automation technology. “It used to be a full-time job just to load orders,” McDonald says. “That’s the only way to survive.” Focus on growth Wiernasz says Klepfish’s strength is developing long-term strategy for the company. “I’m more in the minute detail,” says Wiernasz. “He’s more at the 50,000-foot level.” While Wiernasz knew more about the food business, Klepfish brought the accounting and financial acumen. “That’s been a really strong relationship,” Wiernasz says. As Wiernasz grew sales, Klepfish scouted acquisitions as the company became more successful. “What I liked about him was that he was pretty up front about his strengths and weak-

HATCHING the next idea The technology industry has its business incubators and accelerators, so why not the food industry? Naples-based Innovative Food Holdings provides 7,300 gourmetfood items to chefs all over the country, and many of them are made by budding entrepreneurs looking for help to market their products. Over the years, Sam Klepfish and Justin Wiernasz, the CEO and president of Innovative Food, respectively, have successfully advised and nurtured some of these entrepreneurs. “The entrepreneurial spirit is always alive in food service,” says Wiernasz. “People have great ideas, but they don’t know how to take it from the kitchen to manufacturing. There’s a huge need for guidance in that realm.” So Klepfish and Wiernasz recently co-founded Food Hatch, which will invest between $18,000 and $35,000 in a food business in exchange for an equity stake of up to 8%. Food Hatch hasn’t invested in any companies yet, but the duo say they’ve had a lot of interest, especially via their website (www.foodhatch.co). The company initially plans to invest in no more than five early-stage or nesses,” Wiernasz says. In May 2012, the company acquired Artisan Specialty Foods for $1.2 million, an Illinois gourmet food distributor to high-end restaurants around Chicago. “That gave us a big shot in the arm,” says Wiernasz. As its business continues to grow, there will be more opportunities. Most recently, for example, Innovative Food acquired Haley Group, an advisory firm that helps food producers with manufacturing and product placement. “We’re always on the lookout for acquisitions that make sense,” says Klepfish. To accommodate future growth,

Justin Wiernasz, president of Innovative Food Holdings. startup food companies. Food Hatch has arranged for a group of experienced food-business executives to advise budding entrepreneurs. “We have a model of performance doing just that,” Wiernasz says. —Jean Gruss I n nov at i v e Fo o d a c q u i r e d a 10,000-square-foot building in Bonita Springs. The company paid $770,000, which was below the building’s $2 million estimated replacement value, Klepfish says. What’s more, the company financed the new building with a loan from Fifth Third Bank. And the company arranged for a reverse-split of its stock last year (symbol: IVFH), which increased the price of its stock. Klepfish declines to say whether it might use its stock as a currency for future acquisitions. “It could only be a good thing for the stock to be higher,” he says with a smile.

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22 commercial real estate | CHARLOTTE-LEE-COLLIER |

BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

BusinessObserverFL.com

1 Father, son franchise operators constructing first Florida Culver’s

Port Charlotte

776

Rotonda West

771 17 75

Fort Myers Shores

80 78

Billionaire, landowner Kelley buys Integrated Control Systems HQ BUYER: Boca Norte LLC (principal: Greg Betterton), Venice SELLER: Integrated Control Systems Inc. PROPERTY: 900 and 990 W. Marion Ave. and 955 W. Retta Esplanade, Punta Gorda PRICE: $3.52 million PREVIOUS PRICE: $8.9 million, March 1995 LAW FIRM ON DEED: Grant Fridkin

Fort Myers

Lehigh Acres

Cape Coral 867

93 45

Sanibel

San Carlos Park Immokalee 41 29

Bonita Springs Naples Park

PLANS, DESCRIPTION:

Punta Gorda

BUYER: Naples Custard LLC (principal: Mike Busalacchi), Brookfield, Wis. SELLER: Dunkin’s Diamonds & Gold Real Estate Inc. PROPERTY: 5775 Airport-Pulling Road N., Naples also known as lot 5, Pine Air Lakes, unit 5 PRICE: $850,000 PREVIOUS PRICE: $1.2 million, July 2006 LAW FIRM ON DEED: Kevin F. Jursinski PA, Fort Myers

Mike and Vinnie Busalacchi purchased a 0.87-acre parcel on Airport Pulling Road North between SunTrust Bank and Bob Taylor Chevrolet for $850,000. The price equated to $977,011 per acre. That figure is higher than the two-year average price per acre for retail space ($746,593) in Southwest Florida, according to the CoStar Group. The new owners plan to use the property to create the first Culver’s restaurant in Florida. The Busalacchies already own and operate three Culver’s in Wisconsin. Mike Busalacchi, who lives in Naples and has split his time between Florida and Wisconsin for the past nine years, sees a huge opportunity in the market. He says the large presence of Midwesterners along the west coast of Florida made it especially attractive to the fast-casual restaurant chain. Construction has already started on the 4,300-square-foot restaurant building. It is scheduled to open in August. The building will feature seating capacity for 102 at 35 tables and will generate 70 full- and part-time jobs. Jeremy Kallies will be the operating partner for the new restaurant. “We’re already looking at a second location in Naples,” Mike Busalacchi says. “We already have it under contract.” The Culver’s restaurant chain has announced plans for other franchisees to open restaurants in Fort Myers and Sarasota. The chain has 482 restaurants nationwide. Florida is Culver’s 21st state. The purchase entity Naples Custard LLC mortgaged the property to First Bank Financial Centre for $2.5 million.

By sean roth | reAL ESTATE Editor

Golden Gate

Marco Island

Ochopee 41

Pearson PA, Naples PLANS, DESCRIPTION:

Billionaire businessman/real estate mogul Brad Kelley purchased the 51,824-square-foot former Integrated Control Systems Inc. corporate headquarters and training facilities for $3.52 million. The price equated to $68 persquare-foot. That figure is lower than the two-year average price per-squarefoot for office space ($120) in Southwest Florida, according to the CoStar Group. Located across the street from Charlotte Harbor, the 3.99-acre property features several two-story buildings. The development also included a number of unusual corporate amenities from its time as the home of the IMPAC University business school. It features basketball and racquetball courts, a gym, a library, classrooms, several conference and meetings rooms and a 247-seat auditorium. Integrated Control Systems had the campus built in 1994, but by 2004 the company had filed for bankruptcy. As the Business Observer reported in its March 15 issue, the three-building campus attracted a great deal of attention. The listing generated the most views for any Florida property on LoopNet for several weeks in a row heading up to its auction by Fisher Auction Co. The private Kelley made most of his money from manufacturing tobacco and is now primarily a rancher and landowner. The Land Report magazine lists him as the fourth-largest owner of land in America in its 2012 Land Report 100 and various news reports say he owns roughly 1.7 million acres in Florida, Texas and New Mexico. Last year, he purchased the well-known thoroughbred breeding and training facility, Calumet Farm in Lexington, Ky. Kelley’s local representative, Venice attorney Greg Betterton did not reply to a request for comment as of deadline.

Etc… • Randy Krise has become a member of the Land Development Code Advisory Board for Lee County. Lee County Commission Chairman Cecil Pendergrass appointed Krise. The board advises county commissioners and staff on development code issues and recommends changes to the land development code. • Falcon Fyrie Farms LC purchased

Bruce Fields Manhattan Construction Co. has promoted 28-year constructionindustry veteran Bruce Fields to senior vice president and division manager of the firm’s Southwest Florida operations, which includes offices in Naples and Fort Myers. Fields joined the Manhattan organization in 2008 and most recently led the construction team for the $250 million George W. Bush Presidential Center and the $130 million First Baptist Church project. 5.62 acres of commercial land at 800 West Hickpooche Ave., Labelle from Branch Banking & Trust Co. for $200,000. Andrew DeSalvo and Matt Stepan, of Premier Commercial Inc. handled the sale. • Tannassee Fire Protection purchased an 8,918-square-foot flex, four-tenant building at 1895 Seward Ave., Naples for $452,000 from CWS Enterprises Inc. Fred Kermani of CRE Consultants handled the transaction. • OBPFL - Bonita East 20 LLC purchased 20.06 acres of commercial land at 12585 East Terry St., Bonita Springs from ACM Liberty Comm RE LLC for $300,000. Andrew DeSalvo and Matt Stepan of Premier Commercial Inc. handled the sale. • Open Sky Media Inc. leased 5,472 square feet of office space in Magnolia Square at 1421 Pine Ridge Road, Naples from Magnolia Square LLP. Randal Mercer and Brandon Stoneburner of CRE Consultants represented the tenant and Jeff Clapper of Courtelis Co. represented the landlord. • JJBR Dixon Inc. purchased a 1,710-square-foot flex condominium at 2176 J&C Blvd., Naples from Capital Bank NA for $100,000. Andrew DeSalvo and Matt Stepan of Premier Commercial Inc. represented the seller. • Yvette Camargo Arturo Haran and Peggy Haran purchased a 26.75- acre

property at 20311 Huffmaster Road, North Fort Myers from PAB Residential Holdings LLC for $170,000. Randy Thibaut and Michael Price of Land Solutions Inc. represented the seller. • CAI International leased 2,340 square feet of retail space in Palm Pointe Shoppes at 11601 S. Cleveland Ave., Fort Myers from 2010 Palm Pointe Limited Partnership. Mike Concilla and Brandon Stoneburner of CRE Consultants handled the transaction. • Key West Enterprises LLC purchased 21,578 square feet of office condominium space at 1342 Colonial Blvd., Fort Myers from Branch Banking & Trust Co for $800,000. Andrew DeSalvo and Matt Stepan of Premier Commercial Inc. represented the seller and Nils Richter of Market America Realty represented the buyer. • TerraSmart leased 3,920 square feet of office space at 9200 Estero Park Commons Blvd., Suite 6, 7 and 8, Estero from Roorda Estero Park Commons LLC and Graeme R. Hunter Trust. Andrew DeSalvo and Matt Stepan of Premier Commercial Inc. handled the lease. • Patten Sales & Marketing LLC leased 4,315 square feet of office space at 1100 Fifth Ave. S., Suite 404, Naples from 1100 Building LLC. Scott Dunnuck and Fred Kermani of CRE Consultants handled the transaction. • Ambiance Fine Furniture LLC leased 2,000 square feet of retail space in Bridge Plaza at 12901 McGregor Blvd., Fort Myers. Adam Palmer and Bryan Myers of LandQwest Commercial handled the transaction. • Service Works Partners Investments LLC purchased a 7,480-squarefoot industrial building at 6220 Metro Plantation Road, Fort Myers from Sunsports Warehouse L.C. for $386,000. Bob Johnston, Jerry Messonnier and Derek Bornhorst of Lee & Associates’ Naples-Fort Myers office handled the transaction. • Sterling Estate Sales SWFL LLC leased 5,000 square feet of retail space in The Expo at Brantley, 1901 Brantley Road, Fort Myers. Michelle Hoffmann of LandQwest Commercial represented the landlord. • Rinaldo and Sheron Acciavatti purchased a 1,536-square-foot industrial condominium at 12960 Commerce Lakes Drive, Unit A26, Fort Myers from Commerce Express LLC for $70,000. Bob Johnston, Jerry Messonnier and Derek Bornhorst of Lee & Associates’ Naples-Fort Myers office handled the transaction. • 5720 Zip Drive LLC purchased a 9,500-square-foot industrial building at 5720 Zip Drive, Fort Myers from Brian Cousins, as trustee and William Cousins Jr. for $373,450. Bob Johnston, Jerry Messonnier and Derek Bornhorst of Lee & Associates represented the seller and Phillip Qualls of Premier Plus Realty represented the buyer. • Phenix Salon Suites leased 5,198 square feet of retail space in Bayfront at 412 Bayfront Place, Naples from Bayfront Inc. Mike Concilla and Hamish Williams of CRE Consultants represented the landlord. • Charles Williams purchased a 5,500-square-foot industrial building at 6380 Metro Plantation Road, Fort Myers from Bay Area Industrial Services Inc. for $300,000. Bob Johnston, Jerry Messonnier and Derek Bornhorst of Lee & Associates’ Naples-Fort Myers office handled the transaction. • Sheeley Architects Inc. has completed the architectural design services for a future retail and office center at 9011 Daniels Parkway, Fort Myers. The 1.5-acre site located in front of One Parker Center will feature Starbucks and Heartland Dental Care. Stultz Inc. is the construction manager and Banks

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

BusinessObserverFL.com

commercial real estate | tampa BAY |

Costar

Times Square Properties buys two St. Pete apartments BUYER: A Voice From A High LLC (principal: Robert Repko), St. Petersburg SELLER: Exclusive Designs of Florida Inc. PROPERTY: 236 10th Ave. N.E., St. Petersburg PRICE: $600,000 PREVIOUS PRICE: $175,000, January 1997

bined 38 units. Both facilities offer on-site laundry facilities. The occupancy was in the high 90% range for the portfolio, with only one or two vacancies. Michael Regan, Francesco Carriera and Nicholas Meoli in Marcus & Millichap’s Tampa office handled the transaction. “They needed a little TLC,” says Meoli. “The exteriors needed some updating, mainly new paint. But the interiors of the units were fine. That market is very well stabilized. Most of the market is 92% to 95% occupied.” Lynch owns a number of similar apartment properties in St. Petersburg, with an emphasis on downtown, along with rental homes and commercial space. She is a long-term holder of real estate and is expected to retain these properties for their rental income.

BUYER: Loser LLC (principal: Robert Repko), St. Petersburg SELLER: Exclusive Designs Florida Inc. PROPERTY: 745 Second Ave. N., St. Petersburg PRICE: $800,000 PREVIOUS PRICE: $327,000, June 1998 LAW FIRM ON DEED: Bayshore Title Insurance Agency, Tampa PLANS, DESCRIPTION:

St. Petersburg real estate mogul Maryann Lynch of Times Square Properties purchased two St. Petersburg apartment complexes for $1.4 million. The price equated to $36,842 per unit. The Carmarwin and 236 10th Ave. N.E. multifamily buildings are roughly a mile and half from each other, but were sold together as a portfolio from a single seller. The two feature a com-

2 Benderson Development Co. LLC buys Tampa Electric’s TECO Plaza BUYER: 7978 Associates II LLC (principals: David Baldauf), University Park SELLER: Franklin Street Associates Ltd.

By sean roth | reAL ESTATE Editor

PROPERTY: 702 N. Franklin St., Tampa PRICE: $22 million PREVIOUS PRICE: $1 million, July 1979 PLANS, DESCRIPTION:

Commercial real estate giant Benderson Development Co. LLC purchased the 277,454-square-foot TECO Plaza for $22 million. The price equated to $79 per square foot. That figure is lower than the twoyear average price per square foot for office space ($115) in the Tampa Bay area, according to the CoStar Group. The office property, which covers a 1-acre city block in downtown Tampa, was built-to-suit for Tampa Electric Co. in 1979. Tampa Electric, the primary subsidiary of TECO Energy Inc., occupied the property shortly thereafter and has leased it ever since. It has 13 years remaining on its current lease. Camille Renshaw of Stan Johnson Co. represented the seller, a partnership managed by financial services firm UBS. “This is their headquarters, and they have expressed nothing other than they plan to continue to stay there,” Renshaw says. “It is a classic absolute net lease. The landlord has absolutely no responsibilities. It’s a lot like a bond. With single-tenant properties like these it’s less about the real estate and more about the creditworthiness of the tenant.” She says the seller was looking to take advantage of a heated single-tenant market, she says. Its view of the market was proved accurate with an intensive bid process and highly compressed return for Benderson. Based on the property’s cash flow and the buyer’s cash investment, Benderson received a cash-on-cash return of 5.78%, which

sets a new low-return benchmark, according to Renshaw. For certain business models, such as those used by Tampa Electric or PWC, it makes more sense to rent their real estate leaving more capital in the business.

ETC.

• Keystone Manhattan Apartments LLC purchased the 24-unit Cayman Islander apartment development from Bayou Partners LLC for $375,000, or $15,625 per unit. Built in 1960, Cayman Islander is located at 4205 S. Manhattan Ave., Tampa. Kevin Kelleher, Darron Kattan, Robert Goldfinger and Zach Ames of Franklin Street Real Estate Services handled the transaction. • Tampa design firm, Api(+) provided architecture and interior design services for Yummy Market in Vaughn, Canada. The 50,000-square-foot store opened in February. The store has a 2,315-squarefoot kitchen and is centered around a 3,050-square-foot bakery. • Pawn Depot of Largo Inc. leased 4,500 square feet of retail space in Pine Lake Center at 12001 66th St. N., Pinellas Park from McGrath Family Holdings LLC. Linda West of The Ross Realty Group Inc. represented the landlord.

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BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

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Beker State Park

301 275

Parrish 75

Palmetto Holmes Beach

1 IMG Academy announces expansion, new threephase multi-sport complex IMG Academy has started construction on new multi-sport complex addition to its Bradenton campus. In the first phase of development, the academy will create a 5,000-seat stadium. The sports facility, which is scheduled to open in August, will also include an eight-lane, 400-meter track, a broadcast-ready press box with coach, press and radio rooms, hospitality suites and a collegiate-style video board. IMG Academy also plans to open a new stadium field for baseball. In the second phase, the private athletic training institute plans to create a 40,000-square-foot field house with multiple locker rooms, meeting spaces and offices. The second phase is scheduled to open in December. In the third and final phase, IMG Academy has announced plans to create research and development facilities for sports performance companies. IMG Academy will create new multisport field venues to bring the total sports fields to more than 20 servicing soccer, lacrosse, baseball and football. The new facilities are expected to be particularly important to IMG Worldwide’s relatively new IMG Performance division. Created in 2012, IMG Performance owns and manages more than 100 sporting events, many of which

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2 APH Property Holdings buys Vista At Palma Sola BUYER: Vista Palma Sola LLC (American Property Holdings Corp.), Glenview, Ill. SELLER: AB Merion Palma Sola Associates LLC

PROPERTY: 3900, 3902, 3906, 3910, 3914, 3918, 3922, 3926, 3930, 3934, 3938, 3942, 3946, 3950, 3954, 3958, 3962, 3966, 3974, 3970, 3978, 3982, 3986 and 3990 W. 75th St., Bradenton PRICE: $27 million PREVIOUS PRICE: $20.63 million, December 2011 LAW FIRM ON DEED: Alston & Bird LLP, Atlanta PLANS, DESCRIPTION:

APH Property Holdings, also known

as American Property Holdings, purchased the 340-unit Vista At Palma Sola apartments for $27 million. The price equated to $79,412 per unit. The lakefront development, which was formerly known as the Colonial Grand at Palma Sola, features 23 residential buildings and a clubhouse. The 25-acre property contains a swimming pool and spa, volleyball court, playground, fitness facility, laundry facilities and a lighted tennis courts. Built in 1991, the garden-style apartment complex includes one-, two- and three-bedroom units. As with all APH Property Holdings purchases, the property is being managed by Providence Management Co. LLC. APH Property Holdings is a private real estate investment trust created New York City investment company Prospect Capital Corp. The trust has made a significant push into West Florida recently. Earlier this year, it purchased the 770-unit Camden Live Oaks apartment complex for $63.4 million ($82,338 per unit) and it recently acquired the 280-unit Lofton Place for $26 million (92,857 per unit). The purchase entity Vista Palma Sola LLC mortgaged the property to CBRE Multifamily Capital Inc. for $17.55 million.

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MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

• Roger B. Kennedy Inc. has completed the 35,000-square-foot LA Fitness Sarasota Parkway & Cooper at 8502 Cooper Creek Road, University Park. Designed by ARC3 Architecture Inc., St. Petersburg, the facility is the fourth LA Fitness project constructed by Roger B. Kennedy Inc. this past year. In November, the building firm completed the new LA Fitness Tampa South, also designed by ARC3, as well as the new LA Fitness at The Groves in Windermere, designed by Cuhaci & Peterson, Orlando. Kennedy earlier completed the LA Fitness Hunter’s Creek remodel and 11,000-square-foot expansion in Orlando. • The ground floor of Sarasota Memorial’s new $250 million Courtyard Tower has opened. The rest of the nine-story patient care tower is scheduled to open in phases beginning this fall. The Courtyard Tower’s upper floors are dedicated to cardiac and orthopedic care, while the middle floors will be home to the hospital’s new and expanded neonatal intensive care unit, labor and delivery suites and mother-baby unit. The tower is the cornerstone of a larger campus improvement project that also includes a new state-of-the-art central energy plant, expanded critical care center and

John Neal Homes growing office, staff Lakewood Ranch-based John Neal Homes has doubled the size of its office space from 1,000 square feet to 2,600 square feet and is adding staff, in preparation for additional growth this year. “We were bursting at the seams in our old office space,” John Neal, president of the homebuilder, says in a press release. “The timing was perfect for us to add more space as we grow our business this year with our custom, on your lot division and our expansion into new communities.” four new integrated operating rooms completed in the last several years. • 3293 Fruitville LLC purchased 3293 Fruitville Road, Units 103 and 104, Sarasota from Wells Fargo Bank NA for $242,800. Ian Black, Steve Horn and Melissa Harris of Ian Black Real Estate and Jeff Button of Richardson Kleiber Walters Kleiber Button handled the transaction. • Global Engineering & Contracting Inc. purchased a bank-owned 1,017-square-foot office condominium at 234 N. Rhodes Ave., Unit 108, Sarasota from PNC Bank NA for $96,500. Theresa Blauch-Mitchell of Boback Commercial Group handled the transaction. • Grape A Day Inc. purchased a bankowned 2,034-square-foot office condominium at 202 N. Rhodes Ave., Units 101 and 104, Sarasota, from PNC Bank NA for $189,000. Theresa Blauch-Mitchell of Boback Commercial Group handled the transaction. • Jeevy Computing LLC purchased an 865-square-foot office/retail condo-

Century 21 Beggins Enterprises expanding to Sarasota, Manatee

Wares Creek expansion project awarded Federal funds

Century 21 Beggins Enterprises, a real estate brokerage with five offices in Tampa Bay, plans to expand its reach into Sarasota and Longboat Key with five new locations. The local headquarters for the expansion will be the former Barrier Island Realty office at 7000 Gulf of Mexico Drive, Longboat Key, 1626 Ringling Blvd., Suite 500, Sarasota and additional locations throughout Longboat Key. The firm is looking to attract new agents and has announced strategic alliances with several other real estate companies such as Resort Vacation Accommodations, Property One Annual Rentals, Sperry Van Ness Commercial Advisory Group and Realty One Florida.

The U.S. Army Corps of Engineers was recently allocated an additional $12 million for a flood relief project on Wares Creek in Manatee County. The additional funding will allow the Corps to contract work to complete the long-awaited project along the creek bed from Ninth Avenue to Cortez Road in Bradenton. The first phase of the project, dredging and deepening of the creek bed between Manatee Avenue and Ninth Avenue was completed last fall. But the next and longest area of the flood control project, widening of the creek from Ninth Avenue to Cortez Road, was delayed for lack of funding. “In January, the county began a targeted outreach strategy with key Congressional officials highlighting the importance of the request,” Manatee County Natural Resources Director Charlie Hunsicker says in a press release. “We understood the long odds of gaining approval of an additional $12 million in light of the federal budget sequestration, projected cuts in Corps funding, and the need for unanticipated aid for natural disasters nationwide.” With the final funding secured, Hunsicker thinks the Corps could award a bid for the final section of the project by August and work could begin by the end of the year.

minium unit at 115 N. Tamiami Trail, Nokomis from Stearns Bank for $52,750. David Roth of Re/Max Alliance Group represented the buyer, and Mike Migone of the Sperry Van Ness Commercial Advisory Group represented the seller. • David Timmerman purchased a 1,725-square-foot flex condominium unit at 103 Triple Diamond Blvd., north Venice from Regions Bank for $62,500. Barry Bright of Sandals Realty represented the buyer and Michael Gallatin of the Sperry Van Ness Commercial Advisory Group represented the seller. • D.R. Horton Inc. purchased 30 acres of contiguous land at Bay Street and Old Venice Road in Osprey from Redus Florida Condos LLC and CRM Florida Properties LLC for $4.5 million. Sam Watkins and Janet Robinson of Cold-

well Banker Commercial NRT and Alec String of NRT Development represented the sellers and Todd Menke of Woodmere Realty Advisors LLC represented the buyer.

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BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

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Enviro-Serv Inc. restarts X-Terminate subsidiary Tampa-based Transfer Technology International Corp. has created a new subsidiary to re-launch its pest control management business model. The new subsidiary is named X-Terminate Pest Management Inc. and will focus on termite control, general pest control and lawn and ornamental services. Richard Tellone, a senior master termite inspector and former vice president of X-Terminate Inc., will lead X-Termite Pest Management Inc.. Enviro-Serv Inc. recently changed its name from Transfer Technology International Corp.

Kerkering, Barberio founder hired as Sebring Software CFO Allan Barberio has become chief financial officer of Sarasota-based Sebring Software Inc. Before joining Sebring Software, Barberio spent most of his career in public accounting, and in 1972 cofounded Kerkering, Barberio & Co. That firm now has 120 employees. He was also the courtappointed trustee of a $60 million trust for four years. Barberio will continue to counsel the firm. “Allan is a seasoned financial executive with Barberio extensive experience in the health care industry; representing large medical practices, dental practices, and diagnostic imaging centers,” Leif Andersen, president and CEO of Sebring Software, says in a press release. “Allan’s leadership and financial acumen have been extremely instrumental in previous endeavors, and I am thrilled to have

By sean roth | research Editor

him be part of the team at Sebring, as we take the company into its next phase of growth.” Sebring is focused on providing software solutions to the dental-practice management industry.

Sweetwater Organic Farm

Tampa Bay Entrepreneurship Gala recognizes brewery, Sweetwater farm The University of South Florida Alumni Society of Entrepreneurs honored Cigar City Brewing and the Sweetwater Organic Farm at its Tampa Bay Entrepreneurship Gala May 10. Cigar City Brewing was recognized as the Entrepreneurship Organization of the Year and Sweetwater Organic Farm was the Social Entrepreneur of the Year. The Tampa Bay Entrepreneurship Gala is organized by graduates of the USF Center for Entrepreneurship, to benefit the Michael W. Fountain Endowed Scholarship, named after the current director of the USF Center for Entrepreneurship. The endowment scholarship is designed to help grow the dreams of young entrepreneurs through mentorship, financial support, and additional resources needed to help start their business.

NetWeave Social Networking buys UK social media firm Palmetto social media company NetWeave Social Networking LLC, has acquired U.K.-based Elevate Social,

bringing a number of new aviation and health care clients to NetWeave’s book of business. The deal came about in April through discussions between Kevin McNulty, CEO of NetWeave, and Elevate CEO Adam Miller at Lakeland’s SUN ‘n FUN Fly-In and Expo, where the two were presenters on a social media panel. McNulty says combining the two businesses made sense because NetWeave was also focused on the two industries. Two of its current clients are Sarasota’s Cirrus Aviation and Bradenton Urgent Care. The new business will bring NetWeave’s client list to nearly 100, while also adding one more to its staff of 10. NetWeave Social Networking assists businesses and non-profits in establishing and promoting themselves on social media and managing their online reputations.

American Senior Services hires former ACSIA president as COO St. Petersburg-based American Senior Services Inc. has hired Mark Goldberg as its chief operating officer. Goldberg was most recently president of the long-term care insurance company ACSIA Long Term Care Inc., which had eight consecutive years of doubledigit growth. He also served in various positions with Prudential, Transamerica and Amex Life. “Mark is one of the few professionals in the senior sales space that knows what it takes to grow a business year over year in the form of product sales and sales leadership,” ASSI CEO Bobby Gross says in a press release.

Metz Culinary Management expands, opens Sarasota office Metz Culinary Management, a Pennsylvania-based foodservice firm that serves hospitals, schools and corporations, has opened a Sarasota office in an effort to expand in Florida and the Southeast. The firm hired Longboat Key resident Jack Brill to run its Southern Division corporate office. Clients in that division include health care and long-term care facilities, colleges, universities and independent schools, the company says. Metz Culinary Management President and CEO Jeffrey Metz says the firm brings restaurant-style hospitality to its clients. “Florida is a tremendous market for us,” Metz says. “We are making a strong commitment there. We will put a major push on Florida.” With more than 160 accounts in 14 states, Metz Culinary Management was recently named one of the top 20 management companies in the U.S. by Food Management magazine. Metz adds that the company picked up about 35 accounts in 2012. The firm, based in Dallas, Pa., north of Philadelphia, also operates several franchise restaurants in the Northeast, including a Ruth’s Chris Steak House; 13 T.G.I. Friday’s locations; and two Krispy Kreme stores. Brill has more than 25 years of retail and foodservice industry experience. He’s owned and operated two foodservice businesses, according to the release, and he’s also worked with global food companies and military programs. “I’m thrilled to join the Metz Culinary Management team,” Brill says in a statement, “and feel that we have services that are uniquely qualified for the South.” —by Mark Gordon

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26 corporatereport |

MAY 17 – MAY 23, 2013 | BUSINESS OBSERVER

BusinessObserverFL.com

out of the office | clay date |

By Heidi Kurpiela | Contributor

Bay area execs aim high Miles Dierks, SuperVision Surveillance; Kyle DeLeonard, assistant at Got-Rack. com; Alan Bridges, owner at Got-Rack. com and Rick Gallegos, president and CEO at Dale Carnegie Training

Members of the CEO Council of Tampa Bay tested their marksmanship May 3 at FishHawk Sporting Clays in Lithia. At the suggestion of the group’s vice chairman, Ray Sikorski, CEO and president of Verified Label, Print & Promotions Inc., the 225-member council decided to swap its annual golf tournament for a challenging shooting competition on 77 acres of ranch land outside Tampa. Despite FishHawk’s remote location, more than two dozen members turned out for the game. Said member Hellen Davis, president and CEO of Indaba Global, “This is much more exciting than golf. My adrenaline is pumping!”

Joni Adams, owner and CEO of Refurbished Office Furniture

Craig Lamberson, president of J.O. DeLotto and Sons

Geoff Dyer, CEO and founder of AussieFit; Hellen Davis, president and CEO of Indaba Global; Cyndi Sexton, administrative director of the CEO Council of Tampa Bay and Rodney Collman, owner of Collman & Karsky Architects

Jeff Welch, Bouchard Insurance, Scott Colman and Doug Bishop, CEO at Bouchard Insurance

Ron Zielin, president of Offsite Technology Solutions, and Ray Sikorski, CEO and president of Verified Label, Print & Promotions Inc.

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BUSINESS OBSERVER | MAY 17 – MAY 23, 2013

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