Inside Columbia's CEO Winter 2011

ShOW AND TELL

We Peek Into Ibm’s big blue World

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ShOW ME ThE MONEY

a Reality Check For business borrowers

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JOhN MORISSETTE:

Keeper of Columbia’s best-Kept secret

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the 2011 Sentiment Survey local Ceos Call It like They see It Page 46

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www.ColumbiaCeO.com

CONTENTS

Inside Columbia’s ceo • www.ColumbiaCEO.com • Volume 2, Issue 2

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Opening Bell: the Buzz On CoMo Biz

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the 2011 CeO Sentiment Survey

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the Columbia/Boone County economic Index

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Picture From the Past

Show Me the Money: A reality Check For Business Borrowers

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Inside the Office Of Jennifer Bukowsky

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the CeO roundtable: Money talks

John Morissette’s targeted Marketing Plan takes SeMCO to Greener Pastures

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the Art Of the Client Gift

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the Faces Behind the Franchises

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Patric Chocolate Markets French Appeal with American Flair

Jared reynolds And Carroll wilkerson tell the tale Of An Amazon Fishing Adventure

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Chill Chasers: Hot Looks In Ski Gear

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Young entrepreneurs take their Venture to the next Level

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View From the Hill: A Conversation with rep. Blaine Leutkemeyer

CenturyLink targets Columbia with Innovative Bundled Service

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networking

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Publisher’s note

regional round-Up

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Closing Quotes

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INSIdE COLUmBIA’S CEO

STAff Publisher Fred Parry fred@insidecolumbia.net

Meet OUr eDItOrIAL ADVISOrY BOArD

Associate Publisher Melody Parry melody@insidecolumbia.net

TOM ATKINS Chairman and CEO, Atkins Companies

Editor-in-Chief Sandy Selby sandy@insidecolumbia.net Copy Editor Kathy Casteel kathy@insidecolumbia.net Editorial Assistant Jessica Perkins jessica@insidecolumbia.net Photo Editor L.G. Patterson

GARY DREWING President, Joe Machens Dealerships

RANDY COIL President, Coil Construction

GARY FORSEE President, University of Missouri System

BOB GERDING Partner, Gerding, Korte & Chitwood CPAs

Design Consultant Katie S. Brooks Creative Director Carolyn Preul design@insidecolumbia.net Graphic Designer Katharine Ley katharine@insidecolumbia.net

PAUL LAND Vice President, Plaza Real Estate Services

BYRON HILL President & CEO, ABC Laboratories

DIANNE LYNCH President, Stephens College

GEORGE PFENENGER President & CEO, Socket

Digital and New Media Projects Designer Jill Hamilton jill@insidecolumbia.net Director of Marketing & Business Development Bill Bales bill@insidecolumbia.net Director of Sales Linda Cleveland linda@insidecolumbia.net

BOB PUGH CEO, MBS Textbook Exchange

MIKE STALOCH Vice President of Operations, State Farm Insurance

GREG STEINHOFF Executive Vice President of Business Development, Boone County National Bank

JERRY TAYLOR President, MFA Oil Co.

Marketing Representatives Gerri Shelton gerri@insidecolumbia.net Ken Brodersen ken@insidecolumbia.net Kyle Gross kyle@insidecolumbia.net Business Development Specialist Quinn Leon quinn@insidecolumbia.net

Please Recycle This Magazine.

Inside Columbia’s CEO magazine 301 W. Broadway • Columbia, MO 65203 • Office: 573-442-1430 • Web: www.ColumbiaCEO.com Inside Columbia’s CEO is published quarterly by OutFront Communications LLC, 301 W. Broadway, Columbia, Mo. 65203, 573-442-1430. Copyright OutFront Communications, 2011. All rights reserved. Reproduction or use of any editorial or graphic content without the express written permission of the publisher is prohibited.

Postage paid at Columbia, Mo. The annual subscription rate is $19.95 for four issues.

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Office Manager Brenda Brooks brenda@insidecolumbia.net Distribution Manager John Lapsley Contributing Writers Whitney Spivey Dreier Ed Robb

OPENING BELL

the buzz on como biz

A HEALTHY START Pioneers In Nanomedicine Take A Big Step

MU researchers Raghuraman Kannan and Kattesh Katti, and Shasun founding director Abhaya Kumar celebrate the creation of their new drug development company with Columbia Chamber of Commerce Ambassadors at the MU Life Science Business Incubator.

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his magazine first introduced you to the University of Missouri research team of Kattesh Katti and Raghuraman Kannan one year ago. At the time, they were getting promising results from their work with gold nanoparticles as a potential treatment for prostate cancer.

Now the researchers have taken the next step toward their goal of finding a new and effective treatment for cancer.

In early December, they announced the formation of a new company in partnership with the international firm of Shasun Pharmaceuticals Ltd. Early testing of Katti and Kannan’s radioactive gold nanoparticle treatment in mice has shown tantalizing promise with an 85 percent reduction in tumor volume after a single dose.

Through this new company, the researchers will continue the 10

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extensive testing that must be done before the treatment can be approved for human use.

“MU brings many strengths to this new partnership, which will allow us to clinically translate the unique nanotechnology developed by Drs. Katti and Kannan,” says Abhaya Kumar, a founding director of Shasun. “Everything we need for developing this product for use in patients is at the University of Missouri.”

A $1.5 million initial investment from Shasun will help MU hire additional scientists to further the research.

Robert Duncan, MU’s vice chancellor for research, echoes the optimism: “In addition to offering hope to patients, the partnership with India-based Shasun reflects MU’s commitment to supporting high-tech companies that will create jobs and enhance our quality of life in Missouri and beyond.”

OPENING BELL

the buzz on como biz

A Peek Into A Big Blue World

by SANDY SELBY photo courtesy of IBM

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hat’s going on behind these doors?

We can’t show you — IBM cites security concerns and won’t allow cameras into its Columbia facility — but we can tell you what we saw and heard during a recent tour of the tech giant’s new delivery center.

A friendly but no-nonsense receptionist guards the entrance.

She decides who gets through the locked front door and you won’t step foot into the high-tech hive of work stations without her sayso. She is one of very few administrative employees who will work at the center. The majority of her colleagues will be specialists, assigned to do very specific high-tech work for IBM and its clients.

A handful of people were already hard at work, scattered among the 800 work stations that stretch in every direction from the entrance. From some vantage points, the perfectly straight line of workstations seems to stretch to the horizon. But this isn’t an environment set up for individuals: this is a place for teams. The workstations are grouped in pods and each pod has a whiteboard and a table for “huddles,” frequent team get-togethers to hash out project details.

Recruiting is The walls of the workstation are low. on track to Employees in this 92,000-square-foot meet IBM’s facility can’t hide in cubicles; there are goal of 800 no barriers of furniture or bureaucracy to employees stand in the way of collaboration. at the site The teams will be put together to serve by 2012. particular client requirements and may include specialists in server operations, data storage, hardware and software, and according to Diane Diggelmann, IBM’s vice president of North American Delivery Transformation, staffing will be a dynamic process that will evolve constantly to meet changing customer needs. The recruiting process itself is so complex that IBM representatives are reluctant to pin a number on how many people are currently working at the site. Many are still in the early stages of a lengthy training process. Diggelmann does say recruiting is on track to meet IBM’s goal of 800

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employees at the site by 2012. Of those hired so far, 75 percent are from the state of Missouri with a little less than half coming from Columbia.

What color takes precedence in the world of Big Blue? Green, as it turns out. A bright apple green is painted on accent walls and upholstered on every ergonomically correct workstation chair.

There are also splashes of orange, and yes, blue, and anchoring shades of taupe and gray. The energetic color scheme is no accident. Diggelmann says careful study went into every detail of this environment, including the color scheme and furnishings.

Perhaps the green details are in homage to the building’s environmental friendliness. Joe Dzaluk, vice president of Global Infrastructure and Resource Management for IBM, says the company is seeking LEED certification for the building, which is a renovated structure, not new construction.

“One thing is very important and that’s to ensure we’re doing all we can to help the environment,” Dzaluk says. “Ninety-six percent of materials were recycled during demolition.”

According to Dzaluk, 3,500 tons of waste were removed and recycled from the building. Signs point out some notable “green” features, including a beer bottle in a Plexiglas case that represents the facility’s insulation, 40 percent of which is made from recycled beer bottles.

IBM plans to host a ribbon-cutting ceremony in early 2011 to mark the facility’s official opening, but the employees huddled around computers at their workstations and the training sessions going on behind closed conference room doors are proof that IBM is already open for business in Columbia.

Kudos To CoMo

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hen IBM was considering Columbia as the site for its newest North American delivery center, Columbia officials promised this town would not disappoint them. According to Joe Dzaluk, IBM’s vice president of Global Infrastucture and Resource Management, those expectations have been met and then some.

Here are some of the key things IBM was looking for: Partnerships. IBM is thrilled with the response from the University of Missouri and the other colleges in the area who will be helping train IBM’s future workforce. The company is also impressed with the community, especially Regional Economic Development Inc., for the assistance and guidance provided.

Speed. When IBM was ready to make its move, it wanted to make it quickly. The IBM reps were quick to praise Little Dixie Construction for transforming an ugly metal shell of a building into an ultra-modern facility worthy of the IBM name.

People. According to Vice President of North American Delivery Transformation Diane Diggelmann, the quality of local applicants who have contacted IBM about employment has been outstanding.

OPENING BELL

economic index

The Inside Columbia CEO’s

Economic Index Boone County/Columbia Business Conditions Fall Quarter 2010

94 —

101.1

101.5

97.7

2 0 0 9 Q 2

96.5

97.5

100.3 2 0 0 9 Q 1

95.5

97.8

96 —

96.8

99.2

2 0 0 7 Q 3

101.1

2 0 0 7 Q 2

103.2

105.0 101.6

102.9

104.1

98 —

100.9

108.1 106.1 104.3

104.6 101.7

100 —

102.7

102 —

105.0

104 —

106.8

106 —

100.6

108 —

109.4

110 —

92 — 90 — 2 0 0 4 Q 1

2 0 0 4 Q 2

2 0 0 4 Q 3

2 0 0 4 Q 4

2 0 0 5 Q 1

2 0 0 5 Q 2

2 0 0 5 Q 3

2 0 0 5 Q 4

2 0 0 6 Q 1

2 0 0 6 Q 2

2 0 0 6 Q 3

2 0 0 6 Q 4

2 0 0 7 Q 1

DATE

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nside Columbia’s CEO Economic Index is a quarterly snapshot of how Columbia’s economy is doing compared to where it was five years ago.

Edward H. Robb and Associates, an economic and governmental consulting firm, prepared this index for Columbia and Boone County by collecting data from the past 18 years for 10 key economic indicators: hotel taxes; deplanements at the Columbia Regional Airport; Boone County total sales tax receipts; Columbia total sales tax receipts; Boone County sales tax receipts

2 0 0 7 Q 4

2 0 0 8 Q 1

2 0 0 8 Q 2

2 0 0 8 Q 3

2 0 0 8 Q 4

2 0 0 9 Q 3

2 0 0 9 Q 4

2 0 1 0 Q 1

DATE excluding Columbia; total Boone County building permits; total Boone County single-unit building permits; total Boone County employment; total Columbia employment; and Boone County employment excluding Columbia. After analyzing the data, Robb went a step further and seasonally adjusted the figures to create the most accurate index possible.

The result is a single number that indicates how robust our Columbia/Boone County economy was for a given quarter.

Prepared By E.H. Robb & Associates *The base year for all of the indices is 2000. All indices will average 100 for the 12 months of 2000. **Based on one month of analysis

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2 0 1 0 Q 2

2 0 1 0 Q 3 **

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OPENING BELL

picture from the past

Its days as a hotel ended in 1976, but the building at 811 E. Walnut St. has been a Columbia gathering place since 1902.

When the Athens Hotel opened that year, it quickly became a premier destination for visitors to Columbia. Over the years, the hotel’s reputation slipped and it went through several name changes — The Columbian and the Ben Bolt Hotel — but the exterior of the building remained relatively unaltered. Today the building houses offices, shops and, of course, the venerable Boone Tavern.

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PHOtO BY L.G. PAtterSOn

NO RESERVATIONS

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OPENING BELL

office spaces

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Jennifer’s Picks

Inside The Office Of

Jennifer Bukowsky

by JESSICA PERKINS photo by L.G. PATTERSON

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he sidewalks in The District are sprinkled with chalkboard signs advertising soups of the day and weekend sales. There’s a sign outside defense attorney Jennifer Bukowsky’s Walnut Street office, too, but instead of touting a signature dish, it contains a quote

by Thomas Jefferson.

“The price of freedom is eternal vigilance,” it reads.

During her first couple of years in law school, Bukowsky never dreamed she’d become a criminal defense attorney. The certified public accountant had her sights set on going into civil law and had been offered a sought-after position at the prestigious Armstrong Teasdale law firm. Her last semester of school, however, Bukowsky attended a presentation given by an enthusiastic public defender. It was a careerdefining moment: “I wanted to work with people who were so passionate,” she says.

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And so Bukowsky took a leap of faith, turning down the Armstrong Teasdale post in the hope of obtaining a position at the Missouri State Public Defender’s office. She was offered the job in 2007 after completing her clerkship for the Missouri Supreme Court. As a public defender, she was involved in a variety of cases ranging from trespassing incidents to murder trials by jury.

Bukowsky opened her own law firm in the heart of Columbia in October. At The Bukowsky Law Firm, the attorney acts as an advocate for the accused to ensure that all clients — both innocent and guilty — are treated fairly and that their cases are resolved appropriately. She is an active part of the process to which Jefferson so famously referred.

“I believe in our Constitution, and the only way we stay free in this country is if each person makes sure the articles are abided by,” Bukowsky says.

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In 2006, Judge Mary Russell swore in Bukowsky as an attorney.

Bukowsky’s office walls showcase both personal photos and professional accomplishments, including law review publications and her accounting and law diplomas.

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This small photo was taken while Bukowsky defended an individual in a murder trial.

Parades are a family affair for the Bukowskys: In the last year, the Columbia attorney drove Sen. Kit Bond in her vehicle in the Homecoming Parade and pulled her children, Gus and Blake, in a wagon in the Boone County Fair Parade as seen in this photo.

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Bukowsky’s husband, Brant, gave her this handwriting sample written by Abraham Lincoln. Lincoln was a defense attorney before becoming president; this sample is a piece of a document Lincoln wrote with regard to a trespassing case.

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CEO ROUNDTABLE

From left to right, David Keller, Brett Burri, Karen Taylor, Teresa Maledy and Andrew Beverley answer questions posed by moderator Fred Parry (background).

Money Talks Local Bankers Tackle Tough Topics During The Economic Outlook Conference

by SANDY SELBY photos by L.G. PATTERSON

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usiness leaders from every segment of Columbia’s economy took an unblinking look at the opportunities and challenges that lie ahead when they gathered Nov. 23 for the annual Economic Outlook Conference. This year’s conference, sponsored by the Columbia Chamber of Commerce and Regional Economic Development Inc., covered a variety of topics of regional and statewide interest, including recent success stories

and the importance of regional collaboration.

The day ended with a panel discussion among five Columbia bank executives.

Inside Columbia’s CEO Publisher Fred Parry served as moderator.

The five participating bankers were Landmark Bank President Andrew Beverley, Providence Bank President Brett Burri, Bank of Missouri Community Bank President David Keller, Commerce Bank Central Missouri Region President Teresa Maledy

and Boone County National Bank Executive Vice President of Consumer Banking Karen Taylor.

The editors of Inside Columbia’s CEO prepared the questions and they weren’t tossing softballs. The questionand-answer session began by broaching a subject that can be uncomfortable for bankers: foreclosures. >>> Published reports indicate that foreclosures are at an all-time high in Boone County.

What solutions can your bank offer to help homeowners who are in trouble?

The always-pragmatic Keller didn’t flinch from the question.

“The [foreclosure] trend continues to be brisk and will continue probably at that pace through 2011, based on what we can see,” Keller said. He pointed out that winter 2011

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CEO ROUNDTABLE loans. The state treasurer estimated it would impact about 2,800 jobs in the state of Missouri so we see that as a way we can contribute to the economy.”

What is your best assessment of the local housing industry?

These friendly rivals from Columbia’s banking community all felt optimistic about the city’s future. most fixed-rate loans acquired in the past few years have been sold to other servicers and when homeowners get in trouble, they’re required to deal with those servicing banks rather than the one that originated the loan. “Those servicers use out-of-town attorneys to foreclose. There’s very little communication with the homeowner and that just drives everybody nuts.

“I think on a local basis if you have a portfolio loan that the local bank has control over, the attitude toward the homeowner is a little different. If there is good communication, if the homeowner is paying the taxes and insurance and maintaining the property, and there’s an effort going forward, the foreclosure rate is substantially lower.”

Burri agreed, and advises customers who are having trouble making their mortgage payments to communicate directly with the bank that now holds the loan.

“There are a couple of programs available to modify loans,” he said. “But there are a lot of hoops to jump through to qualify.”

Observers have labeled the economy in the past few quarters a “jobless recovery.”

What are Columbia’s banks doing to improve economic activity in the face of lingering high unemployment?

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Taylor brought up a name that had been mentioned often during the afternoon’s session: IBM. “I think that’s a great example of collaboration,” she said.

“Several banks in the community came together and put a financing package together. I think the banks are all looking for those opportunities and are willing to work together to do what’s right for the community.”

Beyond that, Taylor said, banks want to make loans. “We’re in the loan business and we’ve put the word out that we want to make good loans so we invite people to come and talk to us about that. This is a good time. We’re getting a lot more folks interested in starting their own businesses and there are opportunities through the SBA [Small Business Administration] and other organizations.”

Maledy said that for the past two years, Commerce Bank has been the largest originator of SBA loans within the eastern region so the Columbia bank is experienced in helping business owners with those loans.

“The other thing we recently announced was a partnership with the state treasurer on the Missouri Linked Deposit loans,” Maledy said, “and we’ve committed to a target of $100 million throughout the state of Missouri.

We’ve seen a lot of activity here within our geographic area and that allows businesses to have very low interest rate

“I think everyone knows the local housing market is soft,” Beverley said.

“This year, about 1,700 homes will be sold. It’s been the same for the last couple of years. If you compare that to about five years ago, 2,900 homes sold, so it’s a big difference.”

The outlook is improving, but only slightly for single-family home construction. “It’s increasing but it’s increasing from a pretty low base,” Beverley said. “Looks like there will be about 270 home starts this year. In round numbers, that’s about a third of what it would have been five years ago.”

Maledy said that 72 percent of the mortgage originations her bank is handling right now are refinances as opposed to new purchases. “The other thing we’re hearing is that many people feel it’s still a buyer’s market and they’re more apt to buy an existing home versus new construction,” she said. “Of course, that impacts the construction business and also lot sales in our community.”

What are the most significant changes to your banking operation to come about from this year’s federal regulatory legislation?

Taylor said it’s still too early to know what the full impact of the new regulatory climate will be. “I know we’re trying to prepare the best we can with the little information we have. It changes daily.” She noted that the new regulations have forced Boone County National Bank to add staff to handle compliance, audits and risk management.

Providence Bank recently went through the arduous Federal Reserve exam, so Burri has spent more than his fair share of time with regulators in recent weeks. He said the exam was “far more critical on credit quality, liquidity,

risk management, and with respect to the FDIC, there is additional scrutiny on the loan portfolio. They’re looking for you to do more stress-testing, more monitoring and there is a lot of pending legislation right now that will probably increase the burden.”

Keller emphasized that “the biggest problem for the bank from the regulators, is that they’ve zeroed in on the amount of loans that banks make for construction and development, and they measure it as a percentage of your capital. All the banks in Columbia have a reasonably high level of those loans.”

Keller shared some statistics from his own analysis of four local banks: The Bank of Missouri, Boone County National Bank, Commerce Bank and Landmark Bank. He said the number of nonperforming loans (loans that are more than 90 days past due or no longer collecting interest) among the group has risen 298 percent in the last three years.

Another statistic Keller shared was the percentage of “other real estate property” the banks own, meaning property they had foreclosed on. “That has risen a staggering 909 percent over the last three years,” he said. “Those four banks I did these calculations on are still very sound. They’ll all be able to withstand this, but it brings the tolerance to loans to that industry to a halt and requires administrative oversight, which is oftentimes uninvited and slows down the ability of banks to make progress.”

Beverly agrees that problem loans have increased relative to where they were, but banks in Columbia have a much smaller percentage of those loans compared to the national average.

“If you think about banks in our peer group size, maybe 3½ percent of their loans are nonperforming loans now,” he said. “We’re better than half of that. While there has been a large increase, I don’t want anyone to leave here with the sense that local banks aren’t performing well.”

A lot of people might believe that banks simply aren’t making loans right now. How do you respond to that and winter 2011

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CEO ROUNDTABLE what types of loans are you making?

Beverley was adamant that banks are eager the make loans. The challenge, he says, is lack of demand.

Maledy agreed. “I think individuals are still cautious about the economy and want to make sure they’re still going to have a job with the number of hours they need to borrow money,” she said. “I think businesses are still cautious and want to be careful there’s enough demand for their products or services before they expand. I see people approaching it very prudently, but I think banks are very eager to lend appropriately.”

Taylor, a self-described “glass half-full kind of girl,” said her bank is starting to see more demand than they have in awhile. “I see that as a good sign for our local economy.”

“In the past three years, we’ve made more than $15 million in new loans in the Columbia market,” Burri said. “We’re looking for all types of loans. One of the things that banks are getting scrutinized on is a high concentration of real estate loans. They want to see diversification but we’re definitely in the loan business.”

Try to describe consumer behavior over the past two years. What are you seeing in terms of trends? Are folks sitting on money? Are they spending? Are they increasing their debt? What does it look like from your vantage point?

Keller says his bank has seen a big increase in deposits over the last three years. “Prior to that, Columbia’s deposit growth rate was actually less than the state average. We’re seeing more savings in the banks, there’s no doubt about it.”

A staple of consumer lending for years — the home equity loan — has not fared as well.

“The home equity loan is quickly becoming a thing of the past,” Keller said, “although let’s not forget the fact that since 2000, home prices in Columbia have risen about 38 percent and only in the last two or three years has it started to decline and the median price house has only gone 24

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Karen Taylor says the new regulatory environment is a challenge for all banks. down about 5 to 7 percent. It might slip down another 3 or 4 percent. If you’ve owned a home since 2000, generally you’re still going to have equity in your home, but the folks who bought in the heyday and leveraged it above 80 percent are in a negative or no-equity situation.

And that has changed consumer behavior.”

Burri noted that record low interest rates haven’t discouraged saving but consumers can’t always take advantage of those low interest rates to refinance.

That’s because falling home values have affected appraisals.

Those whose homes do appraise for enough to get them through the refinance process may choose to stay in their homes longer, and that could have some longterm implications for banks, according to Taylor. “With the rates being so low, will people stay in their homes longer?” she asked. “Will this have a longer term effect on turnover of housing? Someone wanting to upgrade will see not only an increase in their home payment but an increase in their interest rate. So I think we’re going to see some fallout from this very low loan rate on the mortgage side in the future.”

Another casualty of the economic downturn is 100 percent financing for homes. “That’s not going to be common anymore,” Maledy says. “People are having to save a significant amount for a down payment. That changes the environment a little bit.”

When you look at Columbia’s economy and the general business climate, what are the areas you see as opportunities?

What areas may be cause for concern?

For Beverley, it was easy to identify the bright spot in Columbia’s economy. “I wish I had a dollar for every time IBM has been mentioned today,” he said. “I think that is fantastic. I think the 3M announcement is great. I think some of the things that are happening with entrepreneurialism are just fantastic.

I think we’re very fortunate to live in Columbia. It will be a slow recovery but I think we’ll do much better than the state averages and certainly better than the national averages.”

It took a bit of coaxing by moderator Parry, but Beverley finally answered the second part of the question and took a pessimistic view about the new banking regulations.

“There are 2,000 pages of regulations and we don’t even begin to understand what the implications are going to be, so I think it’s very easy to be concerned about that,” Beverley said.

Maledy offered a gloomy observation about Columbia that she said would be the same for any city. “Fixed-rate loans are generally sold on the secondary market,” she said, “and there’s a lot of uncertainty

about the secondary market right now, the health of Fannie May and Freddie Mac, mortgage insurance, etc. So if things do deteriorate, that could be an issue for housing here.”

But Maledy is optimistic about the general health of the Columbia economy, thanks to the presence of the University of Missouri and the other colleges. “I think it’s a great foundation for us,” she said.

Taylor is concerned that there are still businesses out there on the verge of failure. “I think there are probably some businesses that have spent their reserves and we are not finished seeing some closing of businesses. There are a lot that have hung on this long, but unless things turn around pretty rapidly, they’re still more of that to come.”

Taylor does see opportunity inherent with being a college town. “We bring in new students who then choose to stay in this community,” she said. “It’s a growing, thriving community.”

Burri takes heart from area collaboration efforts. “I think one of the things that I feel very optimistic about is the collaboration we’ve seen at the state and local level on job creation,” he said.

“Hopefully, there will be more of that to come. We have a diverse economy. We have a strong insurance industry, medical community, banking community, so I think all those things are positive for Columbia. I think the biggest concern I have is the extension of the Bush tax cuts. I’m afraid if some of them aren’t extended, the ripple effect could be devastating.”

Keller is concerned about the number of businesses that have faltered over the past few years. “As a large SBA lender, in 2008 and 2009 we probably took the largest losses in the portfolio I’ve seen in my 35-year career. That having been said, we’ve seen that deterioration of portfolios start to subside. We’re seeing the businesses that survived stabilize.

People who are coming in to start or expand a business at this time have a lot of opportunity. I’ve always said, if I was going to start a business, it would be in Columbia because there is so much opportunity.” winter 2011

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marketplace

The Faces Behind The Franchises Local Business People Find Appetizing Opportunities In Fast Food

by WHITNEY SPIVEY DRIER photos by L.G. PATTERSON

When you swing into McDonald’s on your way to work for a McMuffin and a cup of coffee, do you worry that you’re feeding a corporate monster? The local owners of McDonald’s and other well-known chain restaurant franchises say you may be surprised at just how much their businesses contribute to the local economy.

McDONALD’S (4 stores) Mike Morgan, 39, President, Morgan Restaurants How did it start?

My wife’s parents operated a McDonald’s franchise for more than 30 years. When they were getting ready to retire, they asked us if we were interested in taking over the business. It seemed like a good opportunity, so we agreed. Because Laura’s grandfather opened the Business Loop restaurant in 1959, which was the 171st McDonald’s location, I am a thirdgeneration owner and operator.

How many folks work for you?

We employ approximately 200 people.

Obviously we provide jobs, but another economic factor is that a majority of our business income stays in the local economy. We live in Columbia, own a home in Columbia, and most of our employees do also.

Isn’t fast food unhealthy?

McDonald’s gets a bad reputation because it is the largest restaurant business and therefore an easy target.

I think a lot of the obesity problem we are currently experiencing has more to do with overall lifestyle than diet alone.

People don’t exercise enough and aren’t consistently educated about nutrition and fitness. A cheeseburger, fries and a shake can have a place in a healthy, active lifestyle that includes exercise and a variety of food. And people should know that McDonald’s offers many choices — not just burgers and fries. We make salads, grilled chicken sandwiches and wraps, yogurt parfaits, fruit snacks, fruit smoothies, and we sell juice, milk and water.

“Ronald McDonald always brings a smile to my face.”

What’s your favorite menu item?

A Quarter Pounder with cheese or a Wild Berry Fruit Smoothie; it’s a tie. QPC is a great cheeseburger, and the smoothie is a fun treat or addition to a light lunch or breakfast.

Tell us a story.

There are many fun experiences with my customers and employees, but Ronald McDonald always brings a smile to my face. I’m almost 40 years old, but I feel like I’m 12 any time Ronald McDonald visits one of our restaurants, schools or hospitals. The man who performs as Ronald McDonald in our local market is

a professionally trained magician. I get a huge kick out of his tricks and jokes as well as the way he interacts with people.

Other thoughts?

I am currently the board president for our local Ronald McDonald House chapter.

RMHC has helped children and families in mid-Missouri for more than 27 years.

We are raising the money to build a new Ronald McDonald House next to MU Women’s and Children’s Hospital (formerly Columbia Regional) to better serve our families. It is rewarding to be part of such an important charity’s history and growth. winter 2011

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marketplace

subway (38 stores) Jeffery L. Offutt, 43 How did it start?

When I was 15, my dad asked me what I wanted for Christmas; I told him a copy of Real Estate Money Machine by Wade Cook. He laughed and said, “Really?”

I had it read before New Year’s Eve. I have always wanted to be in business for myself. I like the ability to pour my heart and soul into something and use a lot of elbow grease and sweat to build something. Some people do it with buildings, others with cars, I like businesses. I loved Subway early on for the simplicity of the operation and the appeal of the product. I remarked to someone in 1993, when I first started looking at Subway, that no matter how far technology moves, people always have to eat well.

How many folks work for you?

We employ more than 400 people in the state of Missouri. Most are part28

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time employees, but we have a fair number of folks for whom Subway is their primary occupation. The majority of our managers are high-school educated women. Our pay is slightly above median range and our benefits are significantly above median range for our managers. We try to offer a good environment for our folks to work, and we do not ask them to work as many hours as most restaurants because we want them to have a balance with work and life. We offer an opportunity for advancement; most of our employees have developed through our ranks, and we try to grow far more of our management folks than to recruit from outside.

Isn’t fast food unhealthy?

Subway not healthy? Our primary menu is very healthy. Subway is the preeminent leader in the fast-food industry with

healthy innovations. We are driving the bus and everyone else is trying to play catch-up. We are the only food chain to be endorsed by the American Heart Association. Subway is testing a diabetics menu in Kansas City, which they might roll out nationally to help combat the diabetes epidemic in the United States.

What other chain is even close to testing something like that?

Subway was also one of the first chains to address sodium issues. Several years ago, we launched a very quiet long-term campaign to lower the sodium levels in all of our products. We have to lower a little bit per year during a 10-year period, so as not to shock our customers’ taste buds.

Subway has been evolving our breads to include more fiber and vitamins.

[Subway spokesman] Jared Fogle has a foundation geared for nutritional and lifestyle education for grade-school kids.

What’s your favorite menu item?

Subway Club has been my long-standing sub, but for the last year or so, I have

“We are driving the bus and everyone else is trying to play catch-up.” been craving our Buffalo Chicken subs — great flavor and healthy. There are weeks that I get the Buffalo Chicken three or four times.

Tell us a story.

I might write a book someday titled As Subway Turns: A Tell-All of the Funny & Weird Fast-Food World. The Sunday before Christmas 1997, I had worked most of the day, gotten home around 7 p.m., and was watching TV in bed when I got a call from the police. “Are you the owner of the Subway on Nifong?” I hopped in my car, drove in the snow and pulled up to see six officers inside my store and the employee sitting in one of the booths. I walked in and immediately was hit with the smell of marijuana lingering in the air. One of the cops showed me a table with several half-eaten subs, open chip bags and cookies. Well, needless to say, I had to put an apron on and close the store myself that night. Luckily, I have not had to deal with that again.

Other thoughts?

With what is happening with the economy, costs to operate a restaurant might go up significantly over the next few years. If we continue down the path we are on, it will mean that the restaurants that are in business will have to charge significantly higher prices. What is intended to benefit the low-wage workers will actually have unintended negative consequences. There will be fewer jobs available and significantly slower growth in this sector of the economy, which will be highly inflationary for customers. By 2014, our $5 Footlong Value offer will be the $7 or $8 Footlong value offer — that just does not make a catchy song.

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taco bell (25 stores) Cameron Dunafon, 37, Dunafon Enterprises Inc. How did it start?

My father, David Dunafon, purchased his first franchise (Taco Bell No. 456) in Columbia in 1971 after managing a Taco Bell restaurant in Colorado Springs. I grew up around Taco Bell and worked there for the first time around age 15. I continued to work in the restaurants while growing up, eventually leaving Columbia for the University of Michigan in Ann Arbor. After working approximately five years for Coopers & Lybrand LLP (later PricewaterhouseCoopers), I had the opportunity to move back to Columbia and begin managing the business. It was an easy decision and one I had been waiting to make. I arrived back to 30

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“Don’t be afraid to indulge every once in a while.” work with many restaurant managers that I had worked with 10 years prior. I enjoy watching our younger employees learn leadership and life skills. The most rewarding times are watching those that began at 15 or 16 years of age mature and take over their own restaurant.

That growth keeps me interested in the business each day.

Favorite menu item?

I have two Chicken Soft Tacos Fresco Style almost daily. My favorites are the Enchirito, smothered in cheese and red

sauce, and the Steak Quesadilla — cheese combined with our carne asada steak.

How many folks work for you?

We employ approximately 550. We provide opportunities to those just starting in the work force and have the opportunity to teach them accountability, responsibility, integrity and respect. We provide ongoing opportunities to those interested in restaurant management.

Teaching these life skills to those entering the work force creates discipline and responsibility that will serve them well

should they decide to continue into restaurant management, or ultimately choose an alternative career path.

Isn’t fast food unhealthy?

I eat Taco Bell every day, often twice a day. It was my primary source of nutrition over the past two years while competing in several distance athletic events. In 2009, I completed two Half Ironman distance triathlons. I completed the Detroit Marathon on Oct. 17, 2010. I now exercise 30 to 45 minutes, five days a week. Everyone has a choice to lead a healthy or unhealthy lifestyle. “Fast food” is not unhealthy; rather individual’s choices are unhealthy, and oftentimes I believe food choices get the spotlight when a sedentary lifestyle might be equally to blame. It is not about one area of life, but your life as a whole. If you are aware of your choices and exercise self-control, Taco Bell can easily fit into a healthy diet and lifestyle. Try our new Fresco menu, but don’t be afraid to indulge every once in a while either.

Tell us a story.

Approximately five years ago, we had a deer crash through one of our dining room windows in Kirksville. One of our employees was a high school football player and ran into the dining room, cornered the deer and pulled him out of the restaurant in a headlock. It was a pretty amazing event to review on surveillance video!

Other thoughts?

Taco Bell has been the source of many memories in our family, and we thank all of our employees for their loyalty and dedication to serving the customers each day. The quickest way to brighten my day is to go out and spend some time in the restaurant with those who make everything happen. Without them, we would not be capable of serving our customers and satisfying their needs.

Columbia is also a great community to live and operate in, and we are glad to partner with the Boys & Girls Club of Columbia in teaching our teens valuable skills to succeed in school and in life. winter 2011

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entrepreneurial spirit

Sweet Success

Patric Chocolate Markets French Appeal With American Flair by kathy casteel photos by L.G. PATTERSON

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lan Patrick McClure may be an Irishman, but he’s really a francophile at heart. He’s ardent about the French influences in his life — he loves his wife, Viviane Ducret, and he loves French cuisine.

“I’m a foodie,” he says.

He also loves good chocolate. It was in France, in the culinary capital of Lyon, where McClure found his passion. The self-professed chocoholic had tagged along with Viviane on a year-long visit to her native land in 2003. She was taking a break from her research for a Ph.D. in French literature, but McClure was focused on adventures of a more gastronomic nature: he was on a quest for great chocolate.

“I was eating this chocolate bar from

Bernachon and I remember thinking, “This is the best chocolate I’ve ever tasted,” he recalls. “And I wanted to create that same delicious experience. I’ve been a bread baker and a cheese maker, so I thought maybe I could do this.”

And that’s how McClure went from chocolate fan to chocolate artisan. He spent a few years researching the industry and learning the intricacies of chocolate making — tasting, practicing and mastering the physics of the tempering process — locating cacao suppliers and even fashioning his own equipment to meet the needs of a microbatch bean-tobar chocolate factory. In 2006, he filed the paperwork for a limited liability company.

Naming his new enterprise was easy, he says, another act of homage to France: “I

Adventures In Chocolate Making Alan McClure’s first foray into working with whole-bean chocolate was not exactly a tactile success.

“The first time I ever made chocolate, I was cooking Mexican food,” he recalls.

“I wanted to make molé from scratch. The recipe was a difficult one and I thought if I’m going to go to all this trouble, I might as well make the chocolate from beans.”

McClure ordered cacao beans off the Internet. He first tried to grind the beans the Mayan way, by pulverizing them with hot stones. When that didn’t work too well, he switched to a food processor.

“It made some gritty, not-very-tasty chocolate,” he says. “But the molé was excellent.”

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entrepreneurial spirit

wanted the allusion to French chocolate, so I dropped the “k” from my middle name and it just looked right.”

Patric was born.

By 2007, McClure had bought space and set up shop in Peabody Station off Brown Station Road. Now entering his fifth year in business, McClure is enjoying steady growth in sales with buyers snatching up his handcrafted premium dark chocolate bars from coast to coast as well as in Canada and Sweden.

His product line has gone from one bar to seven, and last spring Food & Wine magazine named Patric a Best New American Chocolate.

These are heady days for the 32-yearold entrepreneur as he and his company transition the business from its infancy.

As company owner, McClure has seen his role evolve from a do-everything oneman operation to leader of a dedicated team. With three full-time employees and a new production manager, McClure is concentrating more on sales and marketing these days, building Patric’s reputation and growing his distribution network.

“Sales have become a major focus for me, which is hard because I’m a hands-on owner, still too involved in every facet of this business,” he says. “I hired a production manager so I wouldn’t get so bogged down in day-to-day operations, but I told him, ‘You have to learn to be me.’

“That can be a blessing and a curse.”

McClure’s business acumen has grown right along with his company. He notes

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that a degree in religious studies from the University of Missouri may not be the best preparation for owning a business.

“I took the long way,” he says. “I had no business education. Chocolate is very romantic, but I saw in Lyon how serious they are about food. It was inspiring.”

He turned to the Small Business & Technology Development Center for help, where counselors walked him through the basics of financing, logistics, supply chain and spreadsheet analysis. The rest has come through experience gleaned through trial and error.

There are inherent challenges in marketing a $7 chocolate bar to people, McClure says. Although sales doubled in 2008 and again in early 2009, he hit a snag in the last half of 2009 as the economic slowdown dragged on. He ramped up his retail distribution, hoping for more impulse buying, and expanded his online sales. More importantly, he learned to listen to his customers.

“I heard from my retailers so many times: ‘We love your chocolate — it’s the best we’ve ever had — but it doesn’t sell well because your packaging is too small and too reserved.’

“The trend is for premium chocolate bars to be big,” he says. “Ours were not.

Customers weren’t seeing it as readily on the shelf and they would gravitate to something else.”

The feedback spurred McClure to send Patric in a new direction. He increased the size of the bars and encased them in

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entrepreneurial spirit larger, redesigned packaging that takes up more space on store shelves. The new look is playful and personal, very American and definitely more eye-catching.

“My earlier packaging had an Old World look to it, like a wine label,” he says.

“It was just too subtle.”

The products have become less subtle as well. McClure introduced three new chocolate bars this year and jettisoned the original Patric, a 1.75-ounce bar of 70 percent Madagascar cacao. The new products — now at 2.3 ounces — are blends: Signature 70%, a dark chocolate blend; Signature Dark Milk, Patric’s first milk chocolate; and PBJ OMG, a blend of dark-roasted natural peanut butter, cacao and sea salt.

PBJ OMG is a seasonal offering that will be available only through the end of 2010. Another seasonal creation, just as quintessentially American, will replace it until spring. McClure plans to keep his chocolate selection at six bars with a changeable seventh rotating in for seasonal variety.

The rebranding effort has rewarded McClure with increasing sales throughout 2010. Although the larger bars sell at a higher price point, they are a bit cheaper per ounce than the old size.

The success of PBJ OMG has inspired McClure to let go with more creativity in naming his bars, and renaming some of his standards. A bar topped with crunchy cacao nibs is now known as In-NIB-itable Bar.

Locally, Patric bars are available at The Root Cellar, World Harvest, Clover’s Natural Market and all three Hy-Vee supermarkets, where they are stocked in the health market rather than the candy aisle. There is also an online store on the website www.patric-chocolate.com.

Shoppers who want custom orders for corporate gifts should contact McClure directly.

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“I’ve decided I’m going to be myself and even get silly,” he says.

There’s nothing silly about the way McClure goes about his business, says Root Cellar owner Walker Claridge, a local retailer of Patric chocolate. “The way Alan approaches business, he sees the big picture,” Claridge says. “Early on, he wasn’t thinking, ‘Where can I sell my chocolate locally?’ He knew his market was national and set up his business model for the Internet. He hasn’t just sat back, either; he always looking for new markets. He’s very focused.”

McClure used to work part time for Claridge at The Root Cellar. “Back when he told me he wanted to start a chocolate factory, I didn’t know what to think,” Claridge says. The two are good friends, but the decision to carry Patric at The Root Cellar was simply good business, he adds.

“It’s so nice for a place like The Root Cellar, which specializes in locally produced, small-batch foods, to have one of the top small-batch chocolate makers right here in Columbia,” he says. “It’s an amazing bonus. We re-order monthly to keep up with demand. It seems there’s never a down season for chocolate in my store.”

As sales and production increase, McClure is looking to expand his facilities. The operation is currently capable of producing 800 pounds of chocolate a month from the 3 to 4 tons of cacao beans imported each year from Madagascar, Venezuela, Ghana and Papua, New Guinea. Yet he yearns for the day when he can spend most of his time on the creative side of the business — that very tasty research and development effort — with the emotional pull that first appealed to him about the chocolate business.

“R&D is my thing; that’s great fun,” he says. “It’s not just about the money — well, yes, it is about the money … it has to be about the money — but the emotional side of things is what made me want to start this business. I can feel good about what I do on so many different levels. I create things that make people smile. And if I can continue to make products that are groundbreaking and delicious, then we’ll get the word out.” winter 2011

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INVENTIONS

Business at first bite

by SANDY SELBY photos by L.G. PATTERSON

Young Entrepreneurs Plan To Take Their Granola Bar Venture To The Next Level

Steven Adamski and Sarah Newsome

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hile other first-time entrepreneurs are bogged down trying to build a better mousetrap, Steven Adamski and Sarah Newsome found success by baking a better granola bar. The recent University of Missouri graduates are getting a taste of business success with Herbal Oats, a Columbia-based venture that produces four tasty granola bar varieties.

Adamski, 26, wasn’t thinking about launching a business when he produced his first granola bars — he was just looking for a healthier alternative than he could find among the sugary, preservativeladen bars he found in stores.

“A lot of my friends encouraged me to do this as a business so I figured out what I needed to do to start up the business.”

That startup was a slow process, made slower by financial constraints inherent with being a college student.

“I saved for four months just to get the $184 dollars to get the business license,” Adamski says.

The Herbal Oats company was born in 2008. Since then, Adamski and his friend and business partner Newsome, 23, have built the brand and developed a following in Columbia and online. Their products are available on the University of Missouri campus and at Hy-Vee, Clover’s Market and Café Berlin.

The Herbal Oats line features four flavors, each infused with a blend of herbs that support a particular health function: Immunity, a blueberry/ almond-flavored bar, contains echinacea; Focus is flavored with raspberry and enhanced with gingko biloba; Strength is a protein-packed, chocolate and peanut-flavored bar; and Energy is sweetened with apples, walnuts and spices, and boosted by black tea.

The two partners remain hands-on with their fledgling business and spend winter 2011

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INVENTIONS

The Herbal Oats line features four flavors, each infused with a blend of herbs that support a particular health function. time each week preparing batches of their granola bars in the commercial kitchen at Café Berlin. “[Café Berlin owner] Eli Gay has been a huge help to us since Day 1,” Adamski says. “He’s probably the first person who believed in us and gave us the opportunity to start up. He’s probably our No. 1 supporter.”

Creating healthy, tasty bars is just one part of the equation for this business, though. The partners figured out early that they needed to create a marketing plan for their product and called upon friends, family, professors and business advisers for help. They worked with Adamski’s aunt to create a logo, built a website and began to market their product by sampling at local stores and the farmer’s market. In December, they rolled out a stylish new version of their label, but it was important to Adamski and Newsome that the logo remain the same.

Newsome says customers often ask store managers for the bars with the picture of the horse on them. “As soon as they say that, the managers know. We wanted a strong logo that would look nice, not just on the packaging but on clothes, hats and shirts,” says Newsome, who sports a thermal shirt emblazoned with that very logo.

The unique packaging features a clear, heat-sealed, biodegradable wrapper 40

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Real success will only come with some real investment, and that’s what the pair is working on now. encasing the label and the waxed-paperwrapped bar. The waxed paper not only protects and preserves the bar, but creates a sensory experience customers enjoy.

“One of the reasons people like our bars is the experience,” Newsome says. “It’s almost like unwrapping a present.”

Although Herbal Oats has gained a faithful local following, its ambitious young owners are eager to take it to the next level.

“We’ve contacted Whole Foods in St. Louis and they’re real interested,” Adamski says. He’s currently plowing through the four pages of requirements Herbal Oats must meet before the bars can be seriously considered for a spot among the other granola bars the grocery chain offers. But real success will only come with some real investment, and that’s what the pair is working on now.

“To take it to the next step, we need a large investment,” Adamski says, adding that the pair’s youth and lack of equity make it difficult for them to get a bank loan. “We’ve been looking into investors and working on a detailed business plan.”

They’ve taken their ideas to Quinten Messbarger at the MU Life Science Business Incubator who is helping them put together a business plan that will attract serious investors.

In the meantime, Adamski and Newsome will head out into the world, armed with their food science degrees, to search for full-time jobs. They admit their passion for their business has come at a price; real-world business experience isn’t as impressive to potential food science employers as time spent in a lab. But they’ll continue to make their granola bars, nurture their fledgling business and hope that their prodigious entrepreneurial instincts and some healthy ingredients turn out to be the recipe for long-term success.

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capital watch

View From The Hill

Congressman Blaine Leutkemeyer Looks Ahead To Opportunities And Obstacles For Business In The Next Congress by KATHY CASTEEL

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uried in the reams of pages of the 2010 Patient Protection and Affordable Care Act lurks the threat of more reams of paperwork for businesses everywhere. Garnering little notice when Congress first passed the federal health care legislation, one piece of the new law is getting plenty of attention now from business interests and other taxpayers who have discovered the law expands tax reporting requirements for business-tobusiness transactions.

“It’s a paperwork nightmare,” says U.S. Rep. Blaine Leutkemeyer. “One of the most worrisome provisions in the health care law.”

Section 9006 of the new federal health care law requires business owners to submit a separate 1099 reporting form for every single business-tobusiness transaction that totals more than $600 in a given year. This greatly expands the reporting requirements of current tax law, which requires businesses to report only those services performed by individuals or other noncorporate entities. Set to take effect in 2012, Section 9006 extends 1099 reporting requirements to corporate vendors and mandates reporting for goods and gross revenues. The Internal Revenue Service is expected to hire as many as 16,000 new auditors to monitor compliance.

Leutkemeyer has joined others in Congress in calling for repeal of the 1099 requirement, although several efforts have failed in the 2010 lame-duck session that will expire by year’s end. The 9th District congressman was a co-sponsor of the Small Business Paperwork Mandate Elimination Act and notes that the House bill may have to be revived in January.

“If the 1099 provision is not repealed in this Congress, I’ll work to see it repealed in the next Congress,” he says, “so that our nation’s small-business owners can focus on job creation instead of paperwork creation.”

Small businesses could be hit especially hard by the requirement in absorbing the expense of additional accounting staff to comply with the law. The U.S. Chamber of Commerce estimates that 40 million businesses will be affected by the requirement.

Leutkemeyer, a Republican from St. Elizabeth who was reelected to a second term in November, makes no secret of his overall distaste for the omnibus health care law. He readily voices additional concerns over other measures in the law that

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he says are less than friendly to businesses.

“In the years ahead, small businesses will be faced with other job-killing provisions in the current law, including new taxes, a costly federally mandated minimum benefits package and other mandates on individuals and employers who will be penalized if they don’t comply with the new health care rules,” he says. “While there are provisions in the bill that I support, the law in its entirety is severely flawed. I hope we can work in a bipartisan manner in this next Congress to find solutions that truly focus on lowering costs without compromising the quality of care.”

As Leutkemeyer looks ahead to the convening of the new Congress in 2011, he sees several business issues on the horizon.

Job creation and economic stimulus: “The best way to revive the economy and create jobs is to reduce government spending and encourage businesses to create jobs. Rather than relying so heavily on the government to spend our way out of this recession, we need to focus on ensuring that our small businesses are able to utilize all the resources already available. My Republican colleagues and I have offered our Pledge to America, in which we pledge to act immediately to stop all job-killing tax hikes and give small-business owners a tax deduction equal to 20 percent of their business income to help with new hiring and capital investment.”

Expanding markets for Missouri goods and services: “So Missouri can remain a top choice for businesses looking to relocate or expand, we must open up more markets for Missouri products. Unfortunately, three free-trade agreements with Colombia, Panama and South Korea are currently stalled in Congress. These agreements could mean more than $800 million in exports to Colombia and an increase of $195 million in agricultural exports to Panama. Free and fair trade is a nocost economic stimulus package for agriculture and our entire economy.”

Cap-and-trade legislation: “The cap-and-trade legislation that I fought against in the 111th Congress is basically dead.

There are not the votes to pass this legislation now and will be even fewer votes in the 112th Congress. That being said, the administration is still supportive of this type of legislation.

We’ll have to be on the lookout for the president and agencies such as the Environmental Protection Agency from pursuing

rules and regulations in place of legislative action on capand-trade legislation. The impact of cap-and-trade policies on the 9th District would be dramatic. We have more than 22,000 farms, covering more than 6.4 million acres of land.

Agriculture is a bull’s-eye industry for an energy tax because it is energy-intensive. An analysis by the Missouri Public Utility Alliance estimates that the cap-and-tax plan for carbon emissions could increase the average electric rate in Missouri by 10 percent in 2015 compared to 2005. In 2020, the increase could be 17 percent and by 2030, rates could be 82 percent higher. I favor an energy strategy that focuses on developing and using all forms of America’s energy potential including, oil, natural gas, coal, wind, solar, biofuels, nuclear power and efficiency measures. Not only will this lessen our dependence on foreign oil, it will also create American jobs.”

A balanced budget amendment: “In Missouri, families and businesses are tightening their belts to make ends meet, and our state government must balance its budget every year. We should hold the federal government to the same standard. I am a strong advocate for a balanced budget amendment because I know it works. Americans should get the opportunity to vote on a balanced budget amendment to our Constitution. I am hopeful that we can accomplish this early in the next Congress.”

“I hope we can work in a bipartisan manner in this next Congress to find solutions that truly focus on lowering costs without compromising the quality of care.”

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REGIONAL ROUNd-UP

William Woods University Plans Housing Expansion

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illiam Woods University, which has experienced a 71.5 percent increase in on-campus enrollment since 1990, plans to build a new residential complex to alleviate a housing shortage. To be named Sorority Circle, it will house all four existing sororities — Alpha Chi Omega, Alpha Phi, Chi Omega and Delta Gamma — on the college’s main campus in Fulton.

Sorority Circle will not only provide new living space for the sororities, it will also benefit other students by freeing up additional housing.

The fundraising goal for Sorority Circle and an adjacent amphitheatre is $8.2 million. It is one part of a threepart fundraising campaign, which also

includes a Center for Ethics and Global Studies and an Alumni and Visitors’ Center. The overall goal for what WWU is calling its Imagine Campaign is $11.7 million.

According to WWU President Jahnae H. Barnett, the need for the Sorority Circle is clear: William Woods must provide additional campus housing to accommodate significant student population growth and to address the decreasing availability of suitable campus housing.

In addition to the large enrollment increases over the past 20 years, WWU welcomed record incoming classes in the fall of 2008, 2009 and 2010, putting the existing residence halls at maximum capacity.

In addition, the advanced age of some existing residence halls makes them no longer appropriate to meet the demands of service as modern residence halls.

Atkinson Hall (which houses Chi Omega) and Harmon Hall (which houses Delta Gamma) were both constructed in the 1930s and do not meet the needs of today’s students, Barnett says.

JEffERSON CITY HOSPITAL TOPS NATIONAL QUALITY RANkING

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t. Mary’s Health Center has been ranked No. 7 among 2,047 hospitals in the United States for overall quality care, according to a national hospital research organization.

The Commonwealth Fund tracks the performance of various health care quality measures to enable organizations to compare their performance against other peer organizations.

The Commonwealth Fund published a case study on the Jefferson City hospital last year titled St. Mary’s Health Center: Focus on Core Measures Improves Quality. The report outlined St. Mary’s quality journey, beginning in 2002, to being one of the highest performing health care organizations in the country. In 2009, St. Mary’s won a Missouri Quality Award from the Excellence in Missouri Foundation.

St. Mary’s is ranked in the top 1 percent of hospitals in the nation for clinical quality, based on all comparative data from the Centers for Medicare and Medicaid Services, as well as the No. 1 hospital in Missouri for quality measures as reported by HealthInsight.

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MOBERLY WAL-MART CONTRIBuTES TO TEChNOLOGY ENhANCEMENTS

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oberly Wal-Mart Distribution Center 6077 recently made a special contribution to support the Moberly Area Economic Development Corp.’s ongoing technology enhancements.

Corey Mehaffy, MAEDC’s president said the recent growth in the MAEDC office requires an additional investment in new technology.

“In recent months, our partners have continued to increase their financial investment in MAEDC in support of our economic development efforts, allowing us to hire an additional full-time economic development professional,” Mehaffy says. “This new position is key to our success in competing with larger economic development organizations. This new position allows MAEDC to concentrate on working with our existing businesses as well as working the business attraction projects in our pipeline without losing focus on our need for ongoing marketing efforts to generate new leads.”

Mehaffy says the $2,000 WalMart Good Works grant will allow MAEDC to purchase the technology needed to handle the organization’s recent growth.

“Wal-Mart is a great corporate citizen and a member of the MAEDC Industrial Club,” he says. “We appreciate their continued support of our economic development efforts here in the MAEDC region and for all they do for the many local organizations they support.”

The 2011 Columbia Business

Sentiment Survey

An Inside Columbia’s CEO

Special Report

Since 2008, Columbia’s illusions of recession immunity have been shattered.

Businesses closed. Unemployment rose.

Confidence faltered.

Still, Columbians cling to the belief that we’re more fortunate than most, thanks to the bolstering presence of our universities and colleges, the city’s importance as a medical service hub and the steadying influence of major insurers.

Is that belief justified? No one knows better than the CEOs of Columbia and we called on 98 of them to weigh in on our second annual Sentiment Survey.

by SANDY SELBY

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The 2011 Columbia Business Sentiment Survey

Who are they to talk?

We sought out the opinion of leaders in a wide variety of industries, from businesses large and small, private and public. Some were entrepreneurs who built their companies from the ground up.

Others climbed the corporate ladder and now enjoy both the perks and the pressures of holding the top job.

This year, 63 percent of our respondents represent privately owned businesses, 18 percent come from the nonprofit world, and 7 percent work for local, state or federal institutions. The rest are divided between publicly traded firms, cooperatives and mutual companies.

More than half (56 percent) are an owner or partner in the business. The rest classify themselves as employees.

The glass ceiling may have some cracks but it’s still intact for this survey group — only 11 percent of the responses came from women. Most of the CEOs surveyed were between 50 and 69 years old (63 percent). The next generation, those 30 to 49, made up another 30 percent. Only 3 percent were younger than 29 and only 3 percent were older than 70.

As for longevity on the job, the group was almost perfectly divided between those who had worked for the same company for less than five years (26 percent), five to 10 years (24 percent), 10 to 25 years (26 percent), and 25-plus years (24 percent).

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Annual Revenue Of Survey Respondents’ Businesses 16% 21%

12% 10%

24%

10%

7% ■ Less that $500,00 ■ Less than $1 million

■ Between $1 million and $10 million ■ Between $10 million and $25 million ■ Between $25 million and $50 million ■ Between $50 million and $100 million ■ $100 million+

Number Of People Employed By Respondents’ Businesses 19% 19%

17% 5% 31%

5% 3%

■ fewer than 5

■ Between 100 and 500

■ fewer than 10

■ Between 500 and 1,000

■ Between 10 and 50

■ More than 1,000 people

■ Between 50 and 100

try to Remember that time in November November’s election called for sweeping changes and we asked the CEOs if the election results changed their perspective. A whopping 78 percent say they are more hopeful in light in the 2010 election results, while 19 percent say the election had no effect on their level of optimism and 4 percent see the election as a sign of bad times to come.

The level of optimism about the world economy remained fairly static from last year’s survey.

There’s a slightly more optimistic view this year about the nation’s economy and while only 11 percent think the state’s economy is on the verge of improving, 50 percent of the CEOs think Missouri is at a leveling-off point. The biggest surge in optimism is reserved for Columbia — 74 percent see improvement on the local horizon and only 7 percent think we’re headed for further decline.

2010 vs. 2011 Economic Outlook ■ Stay the same

worldwide

■ Decline

missouri

36%

38%

2010

31%

2011 17%

44%

2010 18%

45%

30%

39%

50%

2011

39%

11%

Columbia

United States 38%

49%

41%

2010

74%

2011 17%

44%

■ Improve

46%

2011

2010 13%

19%

14% 37%

7%

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The 2011 Columbia Business Sentiment Survey

all pain, No Gain?

The good news? The CEOs expect organization costs such as payroll, benefits and overhead to decline this year, but the bad news is that the majority doesn’t expect to add staff and also expects revenues and profits to decrease.

One of the biggest challenges facing CEOs this year, particularly those running smaller operations, is the health insurance mandate. The majority of the respondents (78 percent) already offer that benefit to their employees, but others expressed serious concerns about their ability to provide that benefit.

One CEO added the comment: “May have to exit a business that can’t afford to offer health insurance.”

Others say the added cost will prevent them from hiring new employees or increasing the salaries for their current employees. Only 2 percent said they would pay a penalty rather than offer the benefit.

We gave the CEOs a wish list and asked them to tell us what their business needed most. Topping the list at 49 percent was “A general improvement in the economy,” followed by “Fewer government restrictions/requirements” (30 percent) and “More qualified workforce” (9 percent). Others are hoping for more capital, predictable tax rates and more tax incentives.

Local Business Projections for 2011 ■ Increase ■ Decline ■ Stay the same Revenues

Organizational Costs

66%

80%

26% 17% 8% 4%

Profits

Staffing

31%

71%

48% 20%

24% 5%

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Local Government Priorities: The Business Community’s wish List

18%

Increasing financial incentives for business

16%

Infrastructure

(streets, sidewalks, sewers, stormwater)

9%

Improving the airport service

31%

Controlling crime

5%

20%

Improving public school education

Other

Other responses included: Reducing and managing city costs, Controlling the budget/addressing the pension issue, Economic development and tax relief, Encouraging new business in Columbia, finding the very BEST qualified candidates to replace the department heads who are leaving city employment, Investing in building an entrepreneurial community (resources, etc.), Jobs, Managing our budget, Positive business climate

think locally Columbia’s crime rate is a big concern for the CEOs, who pushed “controlling crime” from No. 2 on last year’s survey to No. 1 on their list of local government priorities for 2011. They would also like to see the local government boost financial incentives for business, put more focus on the city’s infrastructure and make more strides toward improving Columbia’s air service.

The region’s workforce is failing to impress the CEOs, the majority of whom (56 percent) described it as “adequate.” Only 6 percent gave the local workforce a “high” score and 39 percent gave it a “low” mark. wInter 2011

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The 2011 Columbia Business Sentiment Survey

personally Speaking Despite the economic challenges of the past two years, most of the CEOs surveyed (74 percent) are very satisfied or mostly satisfied (20 percent) with their jobs. In fact, only 6 percent said they were somewhat satisfied or not satisfied. They are also secure in their jobs. Only 2 percent say they feel insecure about their future, while 65 percent said they feel very secure.

Top-level executives are often energized by a challenge and there are certainly challenges to be found.

Sustaining their business’s competitive advantage is the No. 1 challenge for CEOs as they look ahead at 2011.

For 40 percent of respondents, keeping that competitive edge is more important than maintaining profitability (23 percent), attracting and maintaining good employees (17 percent), and developing leaders (11 percent).

A good CEO needs to be able to think strategically, according to the survey group. Thirty-seven percent said it was the most important attribute in a CEO’s arsenal, followed by sound decision-making and strong ethics.

A good CEO also knows to give credit where credit is due and the majority of those we asked said a professional mentor is responsible for teaching them how to conduct themselves in business. Their parents, their spouse and their faith all made the list of powerful influences.

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Job Satisfaction

74% 20%

4% 2%

4%

■ very Satisfied

■ Somewhat Satisfied

■ Mostly Satisfied

■ Not Satisfied

most Important measure of Success

19%

65%19%

17%

33% 5% 5%

31%

4% 2% ■ Impact on Lives of Employees and Customers

■ Company’s Success ■ Personal financial Security

essay Questions What impact do you believe the arrival of IBM will have on your business?

What is your assessment of the current Columbia City Council?

“Should be positive, albeit it will not make a huge difference.”

“A major improvement over the prior council as it is focused on economic development and job growth instead of some former councilmen’s focus on chickens and council seating charts. I believe Mayor Bob McDavid is doing a good job and fully support his efforts.”

“Positive impact as it relates to job creation and the overall mid-Missouri economy.”

“It will bring a new group of highly educated, professional residents to our community, and it may serve to draw other high-tech firms to the area. Both of those developments would be valuable to us.”

“We will benefit directly and indirectly with more business. This will also attract even more talent to this area. Lastly, more business growth will result to attend to the needs of more people and we will all benefit.”

“Could force IT staffing issues.”

“IBM’s payroll will provide an overall lift to our economy — there is absolutely no doubt about that fact. Every business can gain in sales, profit and quality staff if they simply embrace this opportunity!”

“Positive as a draw for other tech businesses. A push in the right direction for the city. Great that so many worked together to bring them in.”

“Additional jobs and payroll dollars will have a positive effect on the overall economy and the opportunities for all businesses, including ours.

In addition, the intangible effect of the collective community optimism created by ‘a big win’ in attracting a major employer in IBM will enhance the business climate.”

“Little to none. It was an insider deal rigged to benefit the inner circle of movers and shakers. A pass is tolerable this time; in the future, the lack of equal opportunity for all businesses will divide the business community. The division will open the door for whackos to return to city hall.”

“Much more friendly to opportunities for all citizens. Less combative and more forwardthinking.”

“It’s an effective, thoughtful group of citizens who work hard for the good of their community.

I don’t always agree with them, but I always respect their integrity and good faith.”

“Our council is doing a very good job! We will face real challenges with the loss of so many top city employees. The greatest loss is the combined history these leaders have.”

“Significantly improved effectiveness since April election but with much room for continued improvement in city governance, management and operational efficiency.”

“Much improved. However, the time for talk is over and the time for performance is needed.

Attention to the basics is a must. Vision for the community’s future must be addressed.”

“Doing a pretty good job. Let’s make certain we keep our eyes on growing Columbia and growing it the right way.”

“The new mayor is off to a good start in setting the stage for business growth. Now if we could get our government officials to support local businesses — that would be a great next step.”

“I believe IBM will boost the Columbia economy so it will trickle down and impact everyone in a positive way.” wInter 2011

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Show Me the

Money A Reality Check For Business Borrowers

Fallout from the Great Recession has left business owners and bankers with a conflicting set of perceptions. Business owners see a tight credit market where loans are difficult — or impossible — to come by. Lenders counter that the demand for credit just isn’t strong yet. It turns out both perceptions are wrong.

by KATHY CASTEEL

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aren Taylor has a blunt message for businesses in search of credit options.

“We want to make loans,” declared the Boone County National Bank executive vice president of consumer banking at Columbia’s Annual Economic Outlook Conference in November. “We’re in the lending business.”

That should come as good news to the local business community wary of changes wrought over the past two years of financial crises. The Great Recession may be officially over by statistical standards, but the lingering aftertaste of bank failures, high unemployment and declining business revenues has given pause to borrowers and lenders alike.

There are bright spots on the horizon, though: reports from the Federal Reserve, Thompson Reuters/ PayNet and the Federal Deposit Insurance Corp. all show an uptick in business lending through the third quarter of 2010; in September, the Small Business Jobs Act kicked in with extended Small Business Administration loan provisions, higher loan limits and expanded eligibility; and in Missouri, the state’s Linked Deposit Program got a $100 million boost from Commerce Bank to fund low-interest loans for small businesses.

There’s money available for loans, bankers say, as long as applicants can meet the criteria in this new financial world order.

“A popular myth these days needs debunking — that the slowdown in extensions of credit is due primarily to an unwillingness or inability of the banking industry to extend credit, which is exacerbating the economic

slowdown,” says Tony Mayfield, UMB Bank Central Missouri Region president. “In actuality, debt is being paid down and institutions are returning to traditional underwriting standards.”

UMB, Mayfield says, continues to be highly liquid, positioning the bank to meet its customers’ credit needs. “Our loan commitments in third quarter 2010 increased 8.5 percent to $4.8 billion and the resulting utilization rate increased slightly to 31.6 percent, compared to 30.6 percent in third quarter 2009,” he says. “What this means is that we are picking up market share and business.”

At Columbia’s Landmark Bank, President Andrew Beverley is happy to see business picking up with lending, albeit at a halting pace. “We see demand for business loans starting to open up a bit, but slowly,” Beverley says. “We hope loan demand increases — we are looking hard for good loan opportunities.”

Access to credit is a basic need for business growth, necessary to fund equipment purchases, expand operations and hire new employees.

But there are caveats, says Bruce Harris, president of The Callaway Bank.

“Banks are willing to lend to quality borrowers,” Harris says, “but due to the current regulatory environment, there are more requirements of borrowers as well.”

Indeed, new government regulations have flung a wrench in the works, says David Keller, community bank president for The Bank of Missouri. “Increasing regulation throws the good banks in with the bad banks, making our job more difficult to serve our clients,” Keller says. “Increasing losses from loan defaults cause banks to become overly cautious in this economic climate at a

time when opportunity for starting or growing a business abounds.”

Tightened regulations have tightened credit access, Keller allows.

“Considering there are more rigid underwriting requirements, fewer transactions will qualify.”

Fewer transactions in fewer industries may be the new norm for lending next year, driven by what the American Bankers Association calls an “inappropriately conservative approach” to loan portfolio scrutiny.

Although some lenders such as The Callaway Bank balk at “profiling” borrowers by industry type, others say an industry’s financial track record could be a deal-breaker in obtaining credit — and real estate is at the top of that list.

“I would say that land acquisition and residential/commercial development loans have drawn more oversight from our regulatory bodies, given current supply,” says Chris Rosskopf, assistant vice president for commercial banking at Boone County National Bank. “But every credit application is different and we review each application on its own merits.”

Hawthorn Bank President Matt Williams also sees risk in land speculation. “In terms of specific industries deemed too risky, financing real estate speculation is more challenging right now,” Williams says.

Bank of Missouri’s Keller agrees that construction and development loans are out of favor due to oversupply and lack of sales. Retailers also face a tough time obtaining credit because of lower profitability and the inability to support increased debt, he says. “Commercial development properties, retail and office properties are generally over-leveraged due to the binge of lending and speculation that occurred from 2004 to 2007,”

Take A Cue From Scouting: ‘Always Prepared’ Got a startup plan? These local bankers have a few words of wisdom for entrepreneurs.

Callaway Bank President & CEO Bruce Harris: “This might not be a bad time to start a new business, but you need to do your homework and have solid contingency plans. Don’t gloss over problems in your business plan. Address them head on. There are certain realities in this part of the business cycle that you need to understand and deal with.”

Boone County National Bank Assistant Vice President Chris Rosskopf: “First, have a solid business plan that you can explain to us. We want to know that you know your business! We can offer some insight when you visit with us, and the University Center for Innovation and Entrepreneurship offers significant expertise and counseling in this area. We often send applicants there to fine-tune their ideas.

Second, you can never have enough capital and equity! The more you are able to accumulate prior to opening your business, and the more you can retain throughout ownership, the greater your chances of gaining additional credit access when you need it and ultimately being successful for the long term.”

Bank of Missouri Community Bank President David Keller: “A new startup must demonstrate management experience in the business to be operated, supported by a well-prepared business plan, family support and adequate ‘skin in the game.’ ”

Hawthorn Bank President Matt Williams: “No. 1, do your homework. Work with the University Center for Innovation and Entrepreneurship.

This is a wonderful service offered free of charge that helps potential business owners plan to start a business. No. 2, understand the numbers. You can be great at a trade or craft, but if you don’t understand the numbers and how to run the business, you will likely struggle. No. 3, start with enough capital. Many businesses start undercapitalized and never really get out of the hole.”

Landmark Bank President Andrew Beverley: “For the strong entrepreneur, downturns can be a great time to start a new business. My advice today is the same as it has been for many years: have a strong business plan, put adequate capital into the business, and have enough working capital to get through the lean times.”

Commerce Bank Executive Vice President Steve Sowers: “Start with a sound business plan based on well-defined assumptions and reasonable projections. It is important that the new business be in an industry where you have expertise and experience. Next, establish relationships with carefully selected advisers to provide expert opinions and professional services as necessary. One of these professional partners should be a banker who is familiar with the market and industry, understands the needs of the business owner and is proactive in introducing solutions to help the business operate more efficiently.”

he says. On the other hand, Keller notes that “service-related businesses with a good track record stand the best chance of meeting with favorable lending opportunities.”

Beverley points to evidence that local businesses and individual borrowers seem to be following the national trend of “de-leveraging” — or paying down debt. “Certainly, compared to some other parts of the country, borrowers here are not as overextended,” he says. “As a result, levels of past-due and troubled loans are well below national averages.”

Business owners who can jump through all the hoops and land on their feet will have to bring some financial savvy to the table when negotiating a loan today, says Rosskopf. “To acquire financing, qualified credit applicants typically

borrowers. The federal stimulus legislation temporarily eliminated many of the fees associated with SBA loans, which makes these loans more attractive. Another program actively in use by Commerce Bank is the Missouri Linked Deposit Program which provides low-interest-rate loans to Missouri businesses.”

Keller likes the range of offerings in SBA loans. “By far, the SBA program with its new lending limit of $5 million offers the best opportunity in terms of repayment, use of proceeds and leverage,” he says.

At Boone County National Bank, qualified borrowers can tailor a financing package from a full line of lending products, including conventional loans, lines of credit and SBA-guaranteed loans, Rosskopf says.

“Our SBA program is often ideal for

have some degree of industry experience, some personal or thirdparty equity available to provide to the business, and a fine-tuned business plan,” he says.

Harris notes that “banks are looking at quality of cash flow very strongly right now with less margin for error backed up by strong liquidity.”

There are many small-business financing options available today, says Steve Sowers, Commerce Bank executive vice president for commercial banking. “Stronger banks have lending capacity and are eager to finance credit-worthy borrowers,” he says. “The Small Business Administration and the U.S. Department of Agriculture offer loan guaranty programs that enhance the availability of credit for certain

A Little Friendly Advice The American Bankers Association offers five tips to maximize success in getting a business loan.

1

2

3

4

5

No.

No.

No.

No.

No.

Get to know bankers at a number of financial institutions.

Before requesting a loan, find out which financial institutions in your market make loans to businesses similar to yours. Not all banks specialize in business loans; some specialize in lending only to certain industries and others favor only those in certain stages of the business life cycle (no startups, for example).

Be able to articulate your firm’s “value proposition” to its target markets.

If you can’t communicate why other companies or customers should do business with your firm, the chances of getting a loan are slim.

Outline your sources of competitive advantage and value to your target markets.

Think like a banker.

Understand the risks of operating in your industry. Have a plan for mitigating those risks, and share it with your banker.

It’s important for the banker to know that you recognize the risks and have a plan for dealing with them.

Develop at least two ways to repay the loan. Bankers look for “primary” and “secondary” loan repayment sources. Plan for contingencies and share these plans with your banker.

Don’t ask for loans that should be funded with equity injections. Bankers don’t get paid to take equity risks; they get paid to make loans that will be repaid on time. Ask your banker how much equity a typical firm in your industry needs to operate effectively.

new and expanding small businesses for their startup, working capital, and equipment needs,” he says. “For those looking to purchase real estate they currently occupy, we have several programs available, including some that have attractive long-term fixed interest rates. Every business is different and our goal is ultimately to offer them options that allow them to spend their time working their way to success.”

Small Business Jobs Act of 2010 Highlights of lending provisions enacted in the Small Business Jobs Act, which became law in September: $14 billion more in lending support Extends Small Business Administration loan provisions through Dec. 31, 2010 Permanently increases 7(a) and 504 limits from $2 million to $5 million Permanently increases microloan limits from $35,000 to $50,000

2010 brought about a new financial era, Mayfield says, what he calls the “new normal.”

“There is a hangover from the period of financial excess, which is hindering the lending environment,” he says. “The increase in regulatory involvement with banks and other financial institutions has only just begun. The lending environment is a topic of concern, but UMB has never stopped making loans and has plenty of liquidity to meet the needs of qualified prospective borrowers.”

Banking has been a tough business the last couple of years, Callaway Bank’s Harris notes. “I suspect that will continue for a while. Banks in general are more attentive to cash flow and liquidity, and while some borrowers complain about that, I believe this heightened attention to the finances of a business by the banks is positive for the banks and the business owners.”

The cyclic nature of economic boom and bust will leave its mark on the business economy, says Bank of Missouri’s Keller.

“Like every other economic business cycle, this, too, will pass as the economy improves,” he says. “Unlike other cycles, the new norm for business growth is slow growth. This period may very well be looked back on as the ‘lost decade,’ similar to the Japanese during the 1990s.

Increases the alternate size standard of businesses to those with less than $15 million in net worth and $5 million in average net income Increases the maximum amount of SBA Express loans from $350,000 to $1 million (until Sept. 27, 2011) Allows some small businesses to refinance their owner-occupied commercial real estate mortgages into the 504 loan program Extends and expands the Dealer Floor Plan Pilot to help small-business owners who sell cars, RVs, boats, other titleable inventory Provides funding of up to $20 million a year over the next three years for loans to small businesses that need up to $200,000 Makes the Export Express pilot loan program permanent with 90 percent guarantees for loans up to $350,000 and 75 percent for loans between $350,000 and $500,000 Offers low-cost capital to smaller community banks if they go above and beyond 2009 small-business lending levels Provides up to $1.5 billion to support state-run small-business lending programs Source: U.S. Small Business Administration

Find Out More U.S. Small Business Administration • Loans and grants for small businesses • www.sba.gov Missouri Small Business Development Center • State office of SBAaffiliated one-stop shop for small-business assistance • 410 S. Sixth St. (200 Engineering North) • 573-882-0344 • www.missouribusiness.net/sbdc/ University Center for Innovation and Entrepreneurship • Financial counseling, marketing assistance and technical access for entrepreneurs • W1026 Lafferre Hall • University of Missouri • 573-882-7096 • www.missouribusiness.net/ucie Missouri Linked Deposit Program • Low-interest loans for small business, agriculture, job enhancement, alternative energy and multifamily housing • www.treasurer.mo.gov/LinkedDeposit

CEO John Morissette’s Targeted Marketing Plan Takes SEMCO LLC To Greener Pastures

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CEO John Morissette stands among SEMCO ductwork at company headquarters.

A supersized version of SEMCO duct is installed in Indianapolis’ Lucas Oil Stadium. When Morissette attended a concert there soon after becoming CEO, he spent more time ogling the ductwork than the stage, embarrassing his daughter.

SEMCO’s energy recovery systems, powered by these desiccant-coated wheels, improve indoor air quality using a fraction of the energy that conventional HVAC systems use. The energy recovery division is driving the bulk of SEMCO’s market growth, says CEO John Morissette.

B

et you can’t name the multinational corporation headquartered in Columbia that’s riding high on a wave of high-tech innovation as it readies for expansion into China, India and other global markets. And no, we’re not talking about IBM or 3M. Columbia’s homegrown SEMCO LLC, a pioneer in air movement, noise abatement and air quality technology, is quietly creating a worldwide empire in the nonresidential construction trade, offering the hottest products for builders who want to get on the fast track to “green building” certification.

Who knew?

CEO John Morissette shrugs off the company’s under-the-radar manner with an affable smile.

“We’re the best-kept secret in Columbia.”

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////////////////

The marketplace maneuverings of Morissette and the longtime Columbia company he runs may be flying under the radar here, but the products SEMCO turns out are as intimately connected to many Columbians as the very air they breathe — literally. The company’s product lines of ductwork, energy recovery systems and acoustical panels have found their way into such local places as City Hall, Boone Hospital Center, IBM, Wilson’s Fitness, Hy-Vee and the University of Missouri.

SEMCO’s reach stretches far beyond mid-Missouri, though, as a major player in the nonresidential construction market throughout the United States and Canada, Europe, Asia and the Middle East.

“We go where the building is,” Morissette says.

Tucked away in a pleasant neighborhood behind the Hollywood

Theaters, the corporate headquarters of SEMCO houses the leadership, sales and engineering staff in a gleaming 18-yearold building that Morissette proudly points out utilizes SEMCO products in its energy-efficient operation.

“In the past three years, the furnace has never turned on,” he notes, expounding on the “green” features of SEMCO’s energy recovery wheel installation that has relegated the standard heat system in the comfortably temperate building to an idle backup.

“Between energy recovery, body heat and lights, the building preserves heat. In the summer, our unit works with the air conditioning to preserve cooling and use less energy.”

In becoming the ultimate recycler, SEMCO has put its money where its corporate mouth is, so to speak, enjoying the fruits of the company’s energyefficient innovations and the savings they

generate. Whenever a SEMCO energy recovery system is introduced into a building design, Morissette says, the heating and air conditioning systems can be downsized. Some systems will pay for themselves in as little time as 1½ years. The savings can really add up, he says: SEMCO products have saved its customers more than $11 billion in the past 15 to 20 years and captured more than 55 million tons of carbon dioxide.

A running ticker on the SEMCO website (www.semcoinc.com) totes up the tally continuously.

“Thirty percent of worldwide energy consumption is from air climate and air movement, and that’s the business we’re in,” Morissette says. “Our business model is to develop new technology and stay ahead of the curve.” ////////////////

SEMCO has been working ahead of the curve since its early days in Salisbury, Mo., nearly 50 years ago. The Salisbury Engineering & Manufacturing Co. began with five employees in 1963 as a sheet metal fabrication company producing ductwork for heating, ventilation and air conditioning systems. The company moved to Columbia in 1974, occupying leased spaces until it built its corporate headquarters on East Pointe Drive in 1992. Across town, a state-of-the-art research and development facility serves as SEMCO’s test lab for the development of new products. Four manufacturing plants are located in Virginia, Tennessee and Arkansas. With annual revenues of more than $50 million, the company employs 300 in its six facilities; 100 work in Columbia.

SEMCO began branching out into innovative air-handling products in 1978. Other pioneering developments followed: desiccant coatings for humidity control; unitary fresh air ventilators; custom estimating software; media-free sound attenuators; an airflow measuring system; the first “intelligent” ventilation system; a duct system with self-sealing gaskets; antimicrobial surface coatings; and desiccant-vapor compression units. The company holds 10 current patents. In 2005, R&D Magazine gave SEMCO its “Top 100 Innovative Products” Award for its Revolution® active desiccant-

vapor compression hybrid rooftop unit.

In 2007, Fläkt Woods, held by a private French equity group based in Geneva, Switzerland, acquired SEMCO, adding the company to its two other American holdings — industrial fan manufacturers Fan Group Inc. in Niles, Mich., and American Fan Co. in Fairfield, Ohio. Fläkt Woods, a conglomerate of smaller companies formed in 2002, has facilities in 15 countries and representatives in 35. The $700 million company employs 3,000.

Morissette arrived in Columbia in late 2008 and became CEO in 2009.

A Canadian transplant, he brought engineering expertise in the industrial fan market and international sales experience to SEMCO’s marketing plan.

He had been with Fläkt Woods since 2002 and had already logged success in turning around the fan companies in Michigan and Ohio by refocusing the business on optimum market segments and improving operational efficiency.

As he prepared to move to Columbia, he entertained similar expectations of success. ////////////////

Morissette and his five siblings grew up in Haileybury, a mining town in northern Ontario on the shores of Lake Temiskaming. His hometown near the Quebec border is bilingual — he attended a French school but spoke English at home. The family was steeped in the mining industry; Morissette’s grandfather owned a diamond drilling company and his father owned a mining equipment firm.

“I come from a free-enterprise family,” he says. “My initial business education was acquired by osmosis at the dinner table — I do know what a Thursday-evening dinner conversation is like, discussing the payroll.”

Perhaps it was the early influence of those Thursday-night discourses that led Morissette to study mathematics and accounting for a year at Ontario’s University of Waterloo. After a work term with IBM, though, the 19-yearold opted out for a year to work in the mines of the Northwest Territories. He returned home to earn an associate’s degree in mining engineering from the Haileybury School of Mines, and then

E-Cubed SEMCO CEO John Morissette calls his company’s approach to the market, E3 (or e-cubed for the more mathematically inclined).

“The drivers are energy, economics and environmental,” Morissette says. “It’s an approach that has served us well.”

SEMCO’s two divisions are operated as separate businesses. The largest division is energy recovery, which comprises two-thirds of SEMCO’s operation. The original duct and acoustical products division make up the other one-third.

SEMCO’s Roanoke, Va., facility produces duct products for commercial, architectural and industrial HVAC applications. Highprofile installations include the Volkswagen plant in Chattanooga, Tenn., the Indianapolis Colts’ Lucas Oil Stadium and CONSOL Energy Center, home of the NHL’s Pittsburgh Penguins.

In Crossville, Tenn., workers produce acoustical panels and silencers for various noise abatement markets such as HVAC, highway barriers, manufacturing equipment and production lines, sports facilities and airports. Acoustical panels can also be installed as easy-to-assemble enclosures for gas pipeline compressor stations, providing solid containment with sound suppression characteristics.

The two Arkansas plants — in Petit Jean and Morrilton — fabricate energy recovery equipment and desiccant-based wheel products for the commercial, industrial and institutional HVAC markets. This is SEMCO’s gravy train, fed by the company’s long-time reputation for energy efficiency in HVAC equipment.

Products in the energy recovery line include fresh-air ventilators, pre-conditioners and total air and climate systems such as the Pinnacle® that manages 100 percent of a building’s ventilation, humidity and temperature while simultaneously reducing energy loads. Flexicool® chilled beams, a radiant cooling and overhead ventilation system that reduces energy usage and architectural impact, are designed for use in nonresidential applications with high temperature load or rooms that require individual climate control. They are often installed in concert with lighting and sprinkler systems.

SEMCO’s premier offering is its desiccantwheel energy recovery system that brings in precooled, dehumidified outdoor air in summer and preheated, humidified outdoor air in winter. The air-exchange technology increases the fresh air in a building by fourfold without increasing energy costs.

“As the green movement continues to take hold within the United States, we find ourselves uniquely qualified to deliver energyefficient equipment,” says Mike O’Loughlin, director of business development. “The green design trend has often prompted design engineers to find their way to our door rather than having to convince them to take an interest in our products.”

The couple, who have three grown daughters and four grandchildren, enjoy riding nearby trails and working out with their dogs at the Canine Sports Center.

“Oh yes, we like it here,” he says, “especially the climate, which is a lot better than the climate up in the Arctic Circle.”

The southerly breezes of the Lower 48 have brought vocabulary lessons to the 52-year-old CEO as well. He delights in sprinkling his speech with American colloquialisms. A new favorite is the Ozarker reply, “I’m finer than a frog’s hair,” when asked about his well-being.

“I’m learning,” he chuckles.

Morissette is impressed with Columbia, and says he finds the community business-friendly. The college-town ambience is just right, he says, neither too big like Columbus, Ohio, nor too small a la South Bend, Ind. “I would like to see another airline come into the airport, though,” he says.

A frequent flyer, Morissette travels to foreign locales about every other month.

“Around here, we have a saying: ‘Want to see the world? Join the Navy — or come work for SEMCO,’ ” he says with a grin. Unfortunately for his SEMCO travel itineraries, flights out of Columbia connect only to Memphis, where the sole international flight heads to Amsterdam for yet another round of connections. ////////////////

it was off to the Yukon and its hard-rock mines of silver, copper, zinc and lead.

Family and work ties took Morissette to the South Dakota School of Mines & Technology, where he earned a bachelor’s degree in mining engineering in 1984.

His corporate career path wound through Ingersoll Rand and Teledyne (“not the Water Pik division,” he notes) in Canada before he veered south into Ohio as market director for three divisions of Teledyne Specialty Equipment.

“I was also dabbling in Teledyne’s international business development,” he says. “In three years, I traveled to 36 countries … Peru, Chile, Australia, Africa 64

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… wherever they have mining. I became comfortable in dealing with different cultures.”

His expertise with specialty equipment and international markets landed Morissette at ABB/Alstom in 2000, running its worldwide milling and pulverizing equipment operation out of Chicago. Two years later, he joined Fläkt Woods and became senior vice president for the Americas. The SEMCO acquisition brought Morissette and his wife, Kim, the furthest south they’ve ever lived — an acreage in the country near Harrisburg that they share with five dogs and assorted cats, horses and parrots.

Foreign markets brought in by SEMCO’s globe-trotting sales staff have invigorated the company’s offerings.

“Fläkt Woods broadened the market and product range for SEMCO,” says sales director Doug Haas, who has been with SEMCO for 29 years. Before joining the Fläkt Woods group, Haas says, “SEMCO was focused on U.S. sales and the sale of SEMCO-manufactured products only, but now we’ve added increased distribution for global sales of SEMCO products, broadening our market range. It also added products to SEMCO’s product portfolio.

These products are all energy-efficiency related and, in some cases, help pull SEMCO products into the sale of a project.”

The company’s market share has grown from 8.8 percent in 2007 to 11.7 percent in 2010, says chief financial officer Bob Brown.

The international focus is one of Morissette’s top two growth initiatives

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for SEMCO, a technology transfer of the chilled beams radiant cooling product from Fläkt Woods in Europe to SEMCO in the United States, for manufacture in Arkansas. Chilled beams are often combined with SEMCO energy recovery products.

“These systems are real synergy,” Morissette says, “and a real growth strategy for us.”

The other growth initiative has focused on product development and sales to domestic industry segments least impacted by the economic slowdown in construction: education and health care.

“Health care buildings have two times the energy consumption of the average building,” Morissette says. “Our applied systems for air quality and energy recovery offer high-end climate control and air movement for large facilities such as hospitals — Boone Hospital’s new patient tower, for example, as well as the Mayo Clinic, Johns Hopkins and the National Institutes of Health.”

SEMCO also produces unitary systems — smaller units for smaller spaces — for use in commercial buildings, schools or hospital emergency rooms.

Success from SEMCO’s growth initiatives has beaten the market by 20 percent in the past three years of declining construction, says CFO Brown.

“In 2010 alone, the nonresidential building construction market is down approximately 22 percent, while SEMCO orders are up 8 percent,” Brown says.

“We’ve been favorably impacted in the past decade (and particularly the past three years) by the world’s growing concern for worldwide energy conservation. SEMCO is strategically placed for long-term growth in this sector with its patented energy recovery products.”

The next frontier for growth is in international markets, Morissette says.

The company is exploring opportunities in Korea, the Middle East and China, working with partners there to open up markets. But rather than exporting products from the United States, these arrangements will eventually involve technology transfer to manufacture products nearer to those markets, introducing a plethora of worries over proprietary protection. And while this means of expansion may be the only way to truly grow, he contends, the company must make sure the “secret recipe” 66

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doesn’t get transferred at the same time.

“We aggressively protect our intellectual property,” Morissette says.

“When somebody steals our lunch money, we don’t like it.” SEMCO has applied for patents in the countries where it operates to protect its trade secrets.

“Of course,” Morissette adds, “few people know the all the ingredients in the ‘secret recipe’ for SEMCO.” ////////////////

His colleagues say Morissette has brought vision to the company as it was ripe for expansion.

“John brings to SEMCO a vision of how to parlay a product sold primarily in the U.S. into a product that can be sold universally throughout the world,” Brown says. “His international experience has been invaluable.”

Product manager Mike Boles calls Morissette an upbeat leader who “has never strayed from his belief that SEMCO can become a worldwide technology leader as well as very successful in the U.S. market for energy-saving, fresh-air products, even with the downturn in the economy.”

Facing down recent economic challenges has earned him kudos from R&D director John Fischer for “managing our organization to better focus on reducing costs and improving efficiency, which has significantly improved SEMCO’s financial performance during times of strong economic ‘head winds’ over the past few years.”

Morissette says his managerial style evolves with his staff. “With new people, I hold them on a short leash, very handson until I am comfortable with them,” he says. “Then I can give them an objective and step back. My leadership is really a combination of ‘helicopter vision’ in seeing the big picture and being ‘in the trenches’ when my people need it.”

When Fläkt Woods acquired SEMCO, he says, “We didn’t acquire buildings and equipment; we acquired people. They are what made SEMCO so attractive to Fläkt Woods. This collection of extremely talented people delivers world-class performance every day — and it’s expected.”

Morissette has rolled out Fläkt Woods’ signature training program to meet leadership needs in key managers and

offer skill modules “as far down as we can go” to impart concepts of marketing, project management, finance and business development to the staff. In addition to this formal training, he has introduced Lean management concepts to SEMCO manufacturing processes.

“My thought for a long time has been that we have employees who make consequential decisions at home every day — we don’t let those same employees ‘check their brain’ at the door when they come to work,” he says. “We provide the tools for decision-making and utilize that thinking in all aspects of the company.” ////////////////

Morissette demands personal integrity from all and, in turn, pledges to deal honestly with all.

“Honesty is the only fair way to treat your folks,” he says. “Dishonesty is a disservice.”

His creed — and perhaps one ingredient of the “secret recipe” for this quiet company’s success — can be summed up in an anonymously authored bit of prose he found and presented to the Fläkt Woods group when he first interviewed with them in 2002.

The World Needs People … who cannot be bought; whose word is their bond; who put character above wealth; who possess opinions and a will; who are larger than their vocations; who do not hesitate to take chances; who will not lose their individuality in a crowd; who will be as honest in small things as in great things; who will make no compromise with wrong; whose ambitions are not confined to their own selfish desires; who will not say they do it “because everybody else does it”; who are true to their friends through good report and evil report, in adversity as well as in prosperity; who do not believe that shrewdness, cunning, and hardheadedness are the best qualities for winning success; who are not ashamed or afraid to stand for the truth when it is unpopular; who can say “no” with emphasis, although all the rest of the world says “yes.”

DIVIDENDS

gift guide

THE ART OF THE gIFT show an employee or Client How much You Care by jessica PerKins and carolyn PreUl

‘Tis the season to agonize over gifts for that special client or deserving employee. Corporate gift-giving is particularly ticklish because it reveals so much about what you value and what you believe your recipient will value. So do you go with something practical or extravagant? Whimsical or tech-savvy? No matter what sort of message you’d like to convey, we’ve hit upon just the right present to do so.

CAFFEINE FIX Grab a cup of gourmet coffee, hot cocoa, tea or an iced drink without visiting the coffee shop.

The Keurig Special Edition Brewing System uses singleserving “K-Cups” in an impressive selection of flavors such as Green Mountain Caramel Vanilla Cream Coffee and Twinings English Breakfast Tea to brew a cup of something delicious in less than a minute. Brewer ($139.95) and K-Cups ($15.45 per 24-pack) available at Keurig.com

CLOSED CASE This multi-purpose iPad case was made with the gadget-lover in mind.

It protects against scratches, works as a stand and includes a slim Bluetooth keyboard that makes typing faster and easier. Leather Rubata iPad case, available at Padacs.com ($99.95)

IN THE BAG They’ll get plenty of use out of a sturdy laptop bag with endless pockets for notepads, pens, cameras, a cell phone and more.

Targus Clamshell Platinum Notebook Case, available at Best Buy ($74.99)

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GOOD MARKS Eliminate one of life’s little hassles and add a touch of luxury with a Fisher titanium nitride bullet pen, a toughas-nails classic that offers steady, splotchfree ink flow. Available in silver, gold, rainbow and black at Binghams Traditional Clothing ($22–$40)

TOUCH TABLET Your business partner will be eternally grateful for this light, portable tablet he or she can use to download and read books, take notes and utilize handy apps. Apple iPad, available at Best Buy ($499.99)

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gift guide WINE LIST This elegant, complex wine has a deep, garnet color and notes of boysenberry, truffles, black pepper, wild game and soy. Silver Oak Cellars 2005 Napa Valley Cabernet Sauvignon, available at Patricia’s Foods ($99.99)

PREMIUM BLEND Help your client celebrate a milestone with an Ashton Estate Sun Grown cigar boasting a blend of rare tobaccos, or treat them to an Ashton Virgin Sun Grown sampler featuring five distinctive cigars. Ashton ESG cigar ($28) and Ashton VSG cigar sampler ($79.99), available at the Nostalgia Shop at Grand Cru Restaurant

ON THE NOSE The Thymes Indigenous poured candle in Tamarind Lychee has fruit and ginger notes that instantly make a home or office more inviting. Try the subtle, floral Blue Lotus candle for a lighter scent or the warm, spicy Malagasy Vanille for something more masculine. Available at Makes Scents ($27) 70

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PERFORMING ARTS Take their minds off work with a night at The Fabulous Fox Theatre in St. Louis. The Tony Award-winning musical “Monty Python’s Spamalot” shows Jan. 7–9, and the Shen Yun Performing Arts ensemble shares breathtaking, traditional Chinese dances and songs Jan. 25–26. For tickets to “Monty Python’s Spamalot” ($25–$63) or the Shen Yun Performing Arts show ($24–$66), call the box office at 800-293-5949.

SWEET TREAT Indulge them with decadent flavors such as chocolate, raspberry, champagne, Irish Cream and tiramisu. Assorted 15-piece truffle gift box, available at The Candy Factory ($13.50)

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DIVIDENDS

ceo at play

Jared Reynolds shows off the peacock bass he caught while fishing in the Amazon.

A Fish Story

Jared Reynolds And Carroll Wilkerson Tell The Tale Of An Amazon Fishing Adventure by sandy selby photos courtesy of jared reynolds

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s fish stories go, the one Jared Reynolds and Carroll Wilkerson tell is a whopper. But unlike most fish stories, this one is absolutely true.

The journey that would eventually take the partners to the Amazon to fish for peacock bass actually began when Reynolds was a child, growing up at his family’s marina business on Truman Lake. His father, Walt Reynolds, was a professional bass fisherman and a friend of fishing superstar Roland Martin. Walt eventually put his expertise to work as the production manager for the “Fishing with Roland Martin” television show.

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Although Jared Reynolds, a partner in Wilkerson & Reynolds Wealth Management, didn’t follow his father’s footsteps into the fishing business, he did maintain a serious interest in the sport.

Eventually he merged his personal and business interests and began providing financial services for fishing pros.

Reynolds’ successful niche marketing has brought in clients from all over the country, including family friend Roland Martin.

“I do a lot of traveling with him,” Reynolds says. “We go to events like the Bassmasters Classic and the ICAST trade show in Las Vegas. It had always been

mentioned that someday he’d like to have me on the show.”

During one of those trips, Martin and Reynolds came across an outfitter who suggested the pro take his show to the Amazon. It fell to Reynolds to put together a group of amateur anglers to join Martin for the fishing trip of a lifetime.

Reynolds picked up the phone and started calling the most fanatical fishermen he knew. The trip filled quickly … “but then we got down to the last couple of people and it was really hard filling those last couple of spots.”

Wilkerson, who was among the first to sign up for the trip, explains why some people were hesitant to take the trip.

“You’re in the middle of the Amazon and completely out of touch.” Wilkerson says. “A lot of people, especially physicians and attorneys, said it was too far and for too long. But as soon as we got back and started telling stories, people were saying ‘Why didn’t you call me?’ ”

Life On The River Last December, Reynolds, Wilkerson and 16 other intrepid anglers flew to a remote, unspoiled part of Brazil to experience fishing on a river that defied everything they thought they knew about rivers.

They expected the Amazon to look like the Mississippi or the Missouri rivers — a wide ribbon of water cutting through the countryside. But the Amazon is wider — up to 10 miles wide in places — and shallower than the group ever expected.

The river was at a low point when the group was there and it meandered around sand bars and islands. It got caught up and cut off in lagoons where hungry fish were trapped and waiting for the rainy season or a big orange fishing lure, whichever got there first.

“You can’t fathom it until you see it,” Reynolds says. “It’s a big impact.

Because it was really shallow in a lot of places, the river would look really wide

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ceo at play

Fishing For Advice

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Above: Carroll Wilkerson jumped at the chance to fish in the waters of the Amazon. Top right: Fishing pro and TV star Roland Martin led the expedition. but the guide would all of a sudden cut way over to the side of the river. It might be only 8 inches deep or so all the way across.”

The water was shallow, but it was swift.

“I swam in it a couple of times and it was very interesting how strong the current was,” Reynolds says. “No matter where you were, there was still a good current.”

The group fished in a section of the Amazon River system called Rio Negro, where the prized catch is the peacock bass, a large and colorful fish that supports a local industry of hospitality providers and river guides. Reynolds’ group spent their nights on a boat, a sort of floating dormitory with bunk beds and tiny but tidy bathrooms. They would 74

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depart for the day’s fishing on smaller boats around 6 a.m., the unchanging time of sunrise near the equator, and returned at 6 p.m. to share a meal and fish stories.

Although the peacock bass was the trophy all the fishermen were after, it wasn’t the only fish they found on the end of their lines. The Rio Negro is also home to piranha and Reynolds did land a few of the fierce fish. Although Reynolds often brushed aside the help of the native guides when they offered to take a fish off the hook, he did let the guide do the honors when he reeled in the piranha.

They may not be much to look at, but piranhas are good to eat, according to Wilkerson. “It’s similar to what we think

ooking to trade in the spincast reel you got for your 8th birthday for something a little more professional? Jared Reynolds has some good advice for the novice angler who wants to raise the game.

“Look at what we call a baitcaster,” he says. “It’s not going to be your little Zebco 202 anymore and it takes practice to learn how to do it.”

Expensive isn’t always better, especially when it comes to a sophisticated fishing reel. “You probably don’t want to start with a tournament-grade reel,” he says.

“You’re going to be able to cast 100 yards with that thing and the person who’s just learning will be backlashing all the time.

Get in a starter series.”

When in doubt, talk to the staff at Bass Pro Shops or your favorite fishing supply store. “Ask the guy at the counter for their best value rod and a good value reel.

Especially given the economy we’re in right now, that’s been the focus because the top-end stuff has stopped selling. The weekend warrior series of equipment is really kind of mainstream right now.”

The next step is to get professional help.

“Call one of the resorts and say, ‘Hey, I want to go fishing but I’m also looking for instruction and want to be taught how to throw a baitcaster.’ ” And finally, don’t be fooled into thinking you need the very same rods and reels you see celebrity fishermen using. “A lot of times when you see those professionals using it, they get it free,” Reynolds says. “If they were going to spend the money, they wouldn’t buy the highest-end thing out there and you don’t have to.”

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Top: A docked boat served as a floating hotel for the group.

Above: Piranha made for a surprisingly tasty entrée. of as crappie or bluegill. White fish. Very good. Very well prepared. They cooked the whole fish with teeth and everything there. It was very beautiful the way they prepared it.”

The group came well equipped for days of fishing in the Amazon, which meant lots of sun protection and bug spray. But one pest they expected to find in abundance was mercifully absent.

“It has to do with the acidity of the runoff,” Wilkerson says, “but there were zero mosquitoes.”

“There were bugs there, but the mosquitoes weren’t,” Reynolds added.

“We had bug spray on and we used citronella patches. The large ones would buzz in and they would circle you twice really close and they would take off. They didn’t bite.”

Reynolds learned one important lesson on Day 1 of the trip. “They said wear fingerless gloves. I would correct

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that and say wear full gloves. My fingers got roasted. That was actually really painful and once they were burned as soon as the sun would touch them, it would hurt.”

Smile For The Camera The “Fishing with Roland Martin” cameras weren’t the only cameras capturing the action. In fact, cameras were one of the most important tools the group brought with them. The coveted peacock bass is rarely caught and consumed. Instead, anglers who haul in one of those beautiful monsters usually toss it right back into the river.

Well, not right back. First they take pictures. Lots of them. Those photos and the fish’s weight is all a sculptor who specializes in peacock bass replication needs to recreate the prize catch. It’s certainly easier than dragging a big dead fish through the airport.

“I don’t even know if customs would allow it,” Reynolds says. He reeled in a 21-pounder and points out an empty space on his office wall that’s reserved for its lookalike.

Reynolds, Wilkerson and their traveling companions were featured in episodes of the “Fishing with Roland Martin” show that aired last summer and they hope the show and their own fish stories will spark enough interest in fishing adventure trips to make it a regular occurence.

Wilkerson & Reynolds Wealth Management already specializes in investment advice and retirement planning, but the partners see opportunity in adventure travel.

“We decided we love doing these kinds of trips,” Reynolds says. They plan to start with some shorter trips for saltwater and freshwater fishing, perhaps even some hunting, which is a longtime passion for both men.

Although the savvy businessmen don’t overlook an opportunity to rub elbows with potential clients, the trips aren’t only about business.

“We love to do it because it’s what we love to do,” Reynolds says. “Fishing is my golf.” winter 2011

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DIVIDENDS

cold-weather cool

Chill Chasers

look Hot on The slopes In stylish ski Gear

by jessica PerKins and carolyn PreUl

Hit the powder with ski gear designed to keep you warm, dry and efficient — all without cramping your style. Fill your suitcase with these toasty pants and jackets, UV-shielding goggles and flexible yet durable ski equipment so you can be on top your game when you’re at the peaks of the slopes. These mountain-friendly picks are engineered to be flexible yet tough, unstoppable yet comfortable. And it doesn’t hurt that they look good while doing it. >>> Men’s 5 Speed Poles

by K2, available at Alpine Shop ($99.95)

Men’s ski bib by Mountain Hardwear, available at altrec.com ($189.95)

Men’s Bugaboo Parka by Columbia, shown in Tusk with Lumberjack Plaid liner, available at Dick’s Sporting Goods ($159.99)

Men’s Prophet 115 Skis by Line Ski, available at Alpine Shop ($850)

Patrol 35 Snow Pack by The North Face, available at Alpine Shop ($189)

Spy Adult Black Sabbath and Bronze Lens Snow Goggles plus bonus lens, available at Dick’s Sporting Goods ($89.99) 78

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cold-weather cool

Women’s Kira Triclimate jacket

by The North Face, available at altrec.com ($248.95)

for the extra cold days on the mountain, wear the shell with the liner for added warmth.

Women’s True Luv Skis with bindings by K2, available at Alpine Shop ($750) and Women’s V6 Ski Poles by K2, available at Alpine Shop ($49.95)

Back It Up pants

by Columbia, available at Dick’s Sporting Goods ($149.99)

Grabber toe warmers 8-pack, available at Alpine Shop ($8.99)

Women’s WindWall Gloves

by The North Face, available at altrec.com ($29.95)

HotHands Heated Insole Foot Warmers, available at Bass Pro Shops ($2.99) Oakley XS O-Frame Snow Goggles, shown in Enamel Mint with Persimmon Lens, available at altrec.com ($45)

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DIVIDENDS

diversions

TRIPLE PLAY

CenturyLink Targets Columbia With Innovative Bundled Service

by KATHY CASTEEL

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t’s taken more than half a century, but television may have finally outgrown its unfortunate nicknames. Disparaged for decades as the “boob tube” and the “idiot box,” a new generation of high-tech telecom service is altering the electronic landscape, promising a seamless interplay of interactive TV, telephone and Internet service for unmatched consumer control over entertainment and communications options. Better yet, Columbia is the first market to offer this service.

Ain’t technology grand?

CenturyLink’s Prism is a TV and high-speed Internet service that uses fiber-optic technology to deliver Internet Protocol Television over the company’s broadband network. Powered by Microsoft Mediaroom, the technology supports on-demand and live video, video recording and time-shifting, and an interactive program guide with integrated search and scheduled recording.

Additional features allow simultaneous recording of up to four programs in highdefinition or standard-definition streams.

“This service is a game-changer that represents multiple competitive advantages over CenturyLink’s cable and satellite competitors,” says Ken McMahon, vice president and general manager for CenturyLink’s Missouri North market.

For Columbia consumers, McMahon says, Prism is a bundled offering of TV, phone and Internet services anchored by what he calls “the most advanced TV service available … with amazing features.”

Prism customers enjoy whole-home DVR, high-definition channels, “warpspeed” channel changing, multiple search options, advanced parental controls and all the other amenities of Microsoft Mediaroom, as well as integrated phone 82

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and computer features such as Caller ID on TV and personal media sharing.

Coming soon are developments such as Anywhere DVR Access and Widgets, which allows customized content management for tailored viewing of anything from sports to weather to stocks or local gas prices right on the TV screen. More information is available at www.seeprismtv.com.

McMahon says Prism has given CenturyLink a leg up on its competitors in this area — Mediacom, Dish and DirecTV. Columbians were the first-in-thenation recipients of this high-tech wizardry when the company then known as CenturyTel began selling Prism in 2008 and chose Columbia as its test market.

Now in full-blown operation, Prism is only available in Las Vegas, La Crosse, Wis., Fort Myers, Fla., and Columbia. Jefferson City, within the same designated market area as Columbia, was added to the mix when CenturyTel and EMBARQ merged as CenturyLink in the summer of 2009.

So how did CoMo get in on the cutting edge?

“Columbia and Jefferson City are strategic markets within CenturyLink, as the combined markets carry the largest number of households within our northern Missouri region,” McMahon says. “Markets are selected on the basis of attractiveness from an investment return prospective, including the economic and competitive environment. We see a tremendous value in offering a triple play, including voice, broadband and Prism TV, and our customers see the value of all services from one provider on one bill.”

Columbia serves as the regional headquarters for CenturyLink’s northern Missouri region, employing a 220-member workforce in the city.

The Monroe, La., based company, which operates in 33 states, is the latest incarnation of Columbia’s telecom service that has evolved from General Telephone to Verizon to CenturyTel, and now CenturyLink.

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DIVIDENDS

networking

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Columbia college president’s society dinner Through vision, leadership and consideration for the future of Columbia College, members of the President’s Society have joined the institution’s tradition of providing quality liberal arts and sciences education to a diverse student body. Guests from the Columbia College President’s Society Dinner gathered Sept. 24 for a dinner in the banquet room at Dulany Hall. (Photos provided by Joanne Tedesco) 1. Columbia College 2010 President’s Society class 2. The Koepke family 3. Margaret Brownlee and Tom Bass 4. Gerald Brouder, Judy Cunningham and Michael Kateman 5. Gerald Brouder, Linda and Tom Atkins and Michael Kateman 6. Tom Atkins and Daisy Willis Grossnickle

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inside Columbia’s culinary adventure Forty-one Columbians traveled to Sonoma County, Calif., for Inside Columbia’s fourth culinary adventure to California’s wine country. The group visited the region’s top restaurants and wineries and toured vineyards and winemaking operations.

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(Photos by Jan King)

1. Cathy Price and Sharon Ginsburg 2. Lyria Bartlett and Brook Harlan 3. Arlene and Linnie Kalaf 4. Steve and Mimi Wenger 5. George and Joni Pfenenger 6. Damien and Lise Cooke 7. Fred and Kathleen Tonnies 8. Paul King, Jerry Olson and Jerry Price at Relish Cooking School 9. Melissa Smith and Todd White 10. The Sonoma County culinary adventurers

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ADVERTISING INDEX Accent Dental....................................................................... 84 Advanced Radiology.............................................................76 Allison, Dant-Allstate...........................................................29 Alpine Park & Gardens.........................................................79 American Family Insurance............................................... 43 Binghams.................................................................................83 Boone County National Bank............................................... 3 Bright City Lights...................................................................75 The Callaway Bank................................................................79 Cancer Research Center......................................................73 Central Trust...........................................................................32 City of Columbia Water & Light........................................36 Coil Construction................................................................. 69 Columbia Insurance Group.................................................35 Columbia Regional Airport.................................................83 Columbia Turf.........................................................................65 Commerce Bank..................................................................... 11 Congratulations to Kat Cunningham................................ 41 CORE....................................................................................... 45 Creative Surroundings..........................................................32 D&M Sound..............................................................................4 Debby Cook Interiors........................................................... 17 Focus on Health Chiropractic.............................................76 Ford, Parshall & Baker...........................................................73 Gary B. Robinson Jewelers................................................. 34 GFI Digital...............................................................................65 Grizzly Bear Lawn Care........................................................ 15 Harper, Evans, Wade & Netemeyer................................. 84 Hawthorn Bank......................................................................92 Image Technologies................................................................9 Inside Columbia’s Best of Columbia................................... 81 Inside Columbia’s PRIME.........................................................13 Jim’s Lawn and Landscaping............................................. 84 Johnston Paint........................................................................23 Kliethermes Homes..............................................................79 Landmark Bank......................................................................25 Line-X.......................................................................................73 Lon BrockmeierRaymond James Financial Services...............................67 Maher, Jack-Maly Commercial Realty.............................77 Mail & More............................................................................ 17 MayeCreate............................................................................75 Missouri Cotton Exchange..................................................75 Moneta Group.........................................................................31 Moresource.............................................................................29 MU Health Care..................................................................... 91 Naught-Naught Agency......................................................83 Peachtree Banquet Center.................................................. 19 Providence Bank.................................................................... 15 R.Anthony Development Group, LLC.............................. 88 Radman, Sheri-RE/MAX.....................................................38 Rainbow House..................................................................... 86 Riverview Technologies........................................................ 19 Sandler Training.....................................................................26 Schuster, BettyPrinciple Financial Group................................................. 17 Shelter Office Plaza................................................................. 5 Smart Business Products.................................................... 20 Smith & Moore....................................................................... 41 Southside Liquors..................................................................37 Starr Properties......................................................................37 State Farm Insurance........................................................... 86 Steve Twitchell Productions................................................26 Stifel Nicholas........................................................................ 19 Swan Lake............................................................................... 34 Sweet, Ron-Attorney, LLC.................................................. 88 Tiger Court Reporting........................................................... 71 Tiger Mobile Advertising.................................................... 69 UMB Bank.................................................................................6 United Country..................................................................... 20 University Club.......................................................................38 Vicky Shy Realty.................................................................... 71 Wobig, Lynn-Allstate............................................................ 71 Whitworth Law...................................................................... 41 Vintage Falls............................................................................36 Waddell & Reed.....................................................................35 Wilkerson & Reynolds......................................................... 20 William Woods University.................................................... 2 Williams Keepers..................................................................38 88

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PUBLISHER’S NOTE

Columbia’s Armchair Economists:

A Look On The Bright Side

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ne of the things I know for cry from the 11 percent of respondents certain is that Columbia who expect the same for Missouri’s is blessed (or cursed) with economy. more than its fair share of And even though our local captains armchair economists. You know the of industry are bullish about Columbia’s type. These are the folks who when economic future, there is still a level asked, “How’s business?” of skepticism and respond by erupting into reluctance about how a litany of anecdotal their companies’ spending evidence that suggests habits will respond to we’re either headed better times. More than toward a double-dip 80 percent of those recession or a soaring surveyed anticipate their economic recovery. organizational expenses We’ve all experienced will decline in 2011. the phenomenon. Ask Many expect to make 12 different people their cuts in payroll, benefits opinion and you’re likely to and overhead costs. get 12 distinctly different This reduction in costs There is an dissertations on the state parallels the expectations almost universal of Columbia’s economy. of nearly 66 percent who acceptance that While it may not carry believe their revenues the gravitas of speaking will also decrease and the economy will with Alan Greenspan or 48 percent who expect be more stable Kinky Friedman, our 2011 profits to decrease. than 2009 and CEO Sentiment Survey At first glance, I am much of 2010, does an excellent job of perplexed by the apparent capturing the mood of contradiction that exists but it will never 98 Columbia CEOs and between increased be as good as their outlook for the confidence in the local it was prior to year ahead. The reports economy and the reality the economic are mixed, but there’s of reduced profits and the downturn that an almost unanimous need to reduce operating tone of confidence about expenses. My own began late in our local economy. The armchair interpretation 2008. state, national and world leads me to believe that – Fred Parry economies don’t hold the many local CEOs have same esteem among local accepted the new reality CEOs. of our economy. There is an almost Driving local confidence is the recent universal acceptance that the economy turnover in city government and the will be more stable than 2009 and much successful recruitment of IBM and up to of 2010, but it will never be as good as 800 new jobs. Nearly 74 percent of those it was prior to the economic downturn surveyed expect steady improvement in that began late in 2008.

Columbia’s overall economy. That’s a far Perhaps it’s just a matter of civic

pride, but local CEOs aren’t expressing a sense of hopelessness about our economy, even though the performance of their own companies will not be as strong. One wonders if the reason they believe we’re heading in the right direction is buoyed by the outcome of the November elections and President Barack Obama’s concession to retain Bush-era tax cuts. And although they haven’t yet personally experienced the recovery they had hoped for, they know that the ground is fertile for a healthy recovery; a rising tide eventually raises all ships.

If you spend much time studying our CEO Economic Index prepared by Ed Robb on Page 14 of this issue, you’ll know that our local economic trends resemble a roller coaster in recent years.

The signs of a slow recovery are evident, though, and things seem to be headed in the right direction. It might not be much to write home about, but it’s progress nonetheless.

There’s no doubt in my mind that Columbia is poised for future success.

The momentum from the IBM announcement followed by Linen King, the Carfax expansion and other good news shows that we are a community that has learned to build upon existing synergies and compete with the finest American cities to attract the nation’s top employers. There also exists a new level of confidence that our City Council and other elected leaders will move mountains to make our city more viable to prospective employers rather than stand as barriers as in years past.

Although we’re still climbing out of the recession, I’m glad to see that Columbia’s CEOs share a strong sense of optimism about Columbia’s future. Our future is indeed bright. winter 2011

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CLOSING QUOTES

What Columbia’s Business People And Community Leaders Are Saying “We had 22,000 people on our Facebook page.

We had 27,000 people respond to our invitation to vote for us. I guess it worked.”

— Shakespeare’s Pizza Manager Kurt Mirtsching, talking to Kansas City’s KMBCTV 9 about the power of social media in propelling the Columbia eatery to its big win in the “Good Morning America” Best Bites Challenge: College Edition contest

“I think it would have been inappropriate and churlish to turn down the invitation from the speaker.”

— Rep. Chris Kelly, a Democrat, on accepting Republican House Speaker Steven Tilley’s invitation to chair the Appropriations Committee on Public Safety and Corrections, in the Columbia Missourian

“No single piece of business is ever worth compromising your integrity.

Ever.”

— SEMCO CEO John Morissette

“There is no question that some sectors of the credit market have tightened during the recession. However, I think the notion that credit is not readily available to small business is misleading. I read a recent survey by the National Federation of Independent Businesses that asked smallbusiness owners to name the biggest challenge facing their business. Surprisingly, the availability of credit was No. 7 on the list behind such issues as overregulation, taxes and weak sales.”

— Steve Sowers, Commerce Bank executive vice president for commercial banking, on what he sees as soft demand for commercial credit

“How can we use these two separate individuals who are really in one body to say they spent three days each?”

— First Ward Councilman Paul Sturtz questioning the validity of the attendance figures at the Roots ‘N Blues ‘N BBQ Festival

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winter 2011

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