Region's Business October 3

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REGION’S BUSINESS

PHILADELPHIA EDITION

A JOURNAL OF BUSINESS AND POLITICS

WHAT ARE BUSINESSES

JUGGLING? The latest state Economic Survey shows some slight optimism from Pennsylvania business-owners, but the effects of the recession are still clearly felt. And until certain national issues get resolved, it’ll be a tough climb to reach a solid economy.

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CONTENTS

“Men make history, and not the other way around.

In periods where there is no leadership, society stands still. Progress occurs when courageous, skillful leaders seize the opportunity to change things for the better.” — Harry S. Truman

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20 What Issues Are Our

Businesses Juggling?

16 Two-Thirds Of DreamIt Ventures’ Startups No Longer In The City

12 15 24 28

Political Commentary Year Of The Innovator Real Estate News

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Commentary

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PRESIDENT AND PUBLISHER James D. McDonald PHILADELPHIA EDITOR Rich Coleman CONTRIBUTORS Brandon Baker, Eric Boehm, Charlie Gerow, Don Lee, Juliana Reyes, Melissa Daniels, Sandy Smith, Greg Meckstroth PROOFREADER Denise Gerstenfield ADVERTISING DIRECTOR Larry Smallacombe DIRECTOR OF BUSINESS DEVELOPMENT Deirdre Affel

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Region’s Business is published weekly on Thursdays and online at www.regionsbusiness.com.

The published makes no representations or warranties regarding the advertising appearing in its pages or its websites.

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WEEKLY BRIEFING

Market8 Ups Ante With Revised, Expanded Design

BY SANDY SMITH

hall, a poker room, and a two-story “ultra lounge” with dining and dancing. That facility will extend upward Apparently realizing that the stakes are higher than into the fifth floor, which will serve as the lobby and they originally thought, the partnership behind the reception area for the complex’s four-star hotel.

“We are neatly integrating Market8 into the existing Market8 casino proposed for 8th and Market streets in Center City released this week a new, significantly urban fabric so that people can experience this buildrevised and enlarged design for their project. ing as a complementary part of East Market Street and The design, unveiled on Monday, prior to Deputy the city,” said Market8 lead investor and developer Ken Mayor Alan Greenberger’s testimony before the Penn- Goldenberg in a news release.

There is at least one other way Market8 will incorsylvania Gaming Control Board (PGCB), incorporates elements of what many perceive to be the proposal’s porate itself into its surroundings: allowing patrons to two chief rivals for the second and last casino license in use loyalty reward dollars in nearby businesses. the city, the Provence in Spring Garden and the Wynn “Because we have designed the facility to encourPhiladelphia on the Delaware riverfront in Fishtown. age pedestrian activity, the foot traffic in the area will Like these other two projects, Market8 is now a com- dramatically improve, and that will, of course, attract plete entertainment, shopping and nightlife complex, new business,” Goldenberg continued.

The day after the announcement, Greenberg, in including a hotel. And like its urban rival the Provence, the complex now engages directly with the sidewalk his testimony before the PGCB, expressed the city’s by moving the casino upstairs and placing retail and opinion that the Market8 and Provence casino prorestaurants, some with outdoor seating, on the street posals had the greatest potential for stimulating new floor. The interior has been reoriented around a central development, redevelopment and spinoff businesses four-story-high atrium which will include a dynamic around their sites and that the city would prefer seeing video display. The casino and its complement of res- one of those two bidders receive the license.

This article was originally published in the taurants, bars and lounges now occupy the second and third floors of the podium, while the fourth floor Philadelphia Real Estate Blog at blog.philadelphiawill contain a live entertainment venue/multipurpose realestate.com.

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WEEKLY BRIEFING

HOUSING

Citizens Commits $1B For Low-Income Housing

Temple, Lehigh Among Best In Nation For Entreprenuers

RBS Citizens Financial Group recently announced a commitment to provide $1 billion in funding for affordable housing and community development projects over the next five years in areas across the northeast and midwest, including Camp Hill, Pa. According to a release, the loans and investments made through this program are part of the bank’s efforts to provide communities with products and services to support community stabilization and economic health.

“Our focus on supporting the communities we serve has never been more central to our work as a bank, and we’re proud to express our continuing long-term commitment to community development with this $1 billion initiative over the next five years,” Robert Matthews, Vice Chairman of Commercial Banking, RBS Citizens Financial Group, said in the release.

The company made a $10 million Low Income Housing Tax Credit equity investment for the Camp Hill, Pa., area.

Half of that investment will go to new construction of 19 low-income housing units, available to households with incomes at or below 60 percent of median income .

Pennsylvania was well-represented on The Princeton Review’s list of Top 25 Schools for Entrepreneurship Programs for 2014.

Temple University and Lehigh University ranked Nos. 13 and 20, respectively, on the undergraduate list, released last week. Temple also rated No. 19 on the graduate program list.

Temple’s Fox School of Business and the Philadelphia university’s weaving of entrepreneurship programs in non-business disciplines has been put on this list for 13 years in a row.

It’s the latest in a recent run of entrepreneurial kudos for Lehigh, which was named one of 10 Great Colleges for Aspiring Entrepreneurs and had its College of Business Engineering earn the No. 12 spot for Entrepreneurship Specialty Programs by Bloomberg Business Week.

“It is clear that Lehigh is firmly on the map as a go-to university for aspiring entrepreneurs and creative thinkers,” said Todd Watkins, executive director of Lehigh’s Baker Institute and a profes-

sor of economics.

This article was originally published in Keystone Edge at KeystoneEdge.com.

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WEEKLY BRIEFING

Philly Residents Growing Concerned

SRC Urged To Implement Work Reforms on Seniority and Staffing

A new poll from The Pew Charitable Trusts finds that Philadelphians are concerned about the city’s prospects and give the city its lowest ratings in the five years that Pew has been polling locally.

Forty-five percent of respondents said the city was “off on the wrong track,” compared with 37 percent who said it was “headed in the right direction.” In 2009, the responses were reversed, with 37 percent choosing the wrong track and 46 percent the right direction.

Thirty-seven percent of residents said the city had become a worse place to live during the past five years, while 25 percent said it was better. In 2009, only 27 percent said worse, and 33 percent indicated better.

Despite these negative perceptions, three-fifths of Philadelphians said they considered the city a good or excellent place to live, roughly the same as in previous years.

Public-school parents and education reform groups Monday called on the School Reform Commission (SRC) to use its existing authority to implement policies that put student needs ahead of employee seniority when it comes to hiring, assigning and compensating teachers.

Parents and advocates alike urged the SRC to end the negotiation stalemate by using its managerial prerogative to implement staffing reforms now.

In doing so, they believe the SRC also will go a long way toward convincing the state to release the $45 million in one-time funding that has been reserved for Philadelphia schools upon evidence of “fiscal stability, educational improvement and operational control.”

Their message is clear: The key to great schools is great teachers, but the District’s current seniority-based policies often get in the way of ensuring that every school has effective teachers who are the right fit for the school’s unique culture and student population.

“Moving away from seniority as the basis for personnel decisions is the right thing to do for our children,” said Mark Gleason, executive director of the Philadelphia School Partnership and the parent of a District high school student.

“Governor Corbett has made it clear that the release of the

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$45 million is dependent on the implementation of significant reforms. If the SRC acts to implement these reforms, it will be a major step toward securing the release of that money.”

Organizations represented included Parent Power, the Pennsylvania Campaign for Achievement Now (PennCAN), and the Philadelphia School Partnership (PSP).

“It is long past time for the SRC to act on this issue,” added Jonathan Cetel, executive director of PennCAN. “The District has negotiated for seven months with the union on a new contract, and there has been little progress on any issue, especially on these vitally important reforms.”

The National Council on Teacher Equality noted that the SRC already has used its powers to suspend portions of state law so that it can recall laid-off employees according to factors other than seniority.

But that action, which occurred in August, applies only to recalled employees, not to those transferring from one school to another.

Typically in October, dozens of teachers get transferred to accommodate shifts in enrollment that have been identified since the start of the school year.

3 OCTOBER 2013

REGIONSBUSINESS.COM

HEALTHCARE

Merck Plans To Cut 8,500 Jobs Philly.com reported that the drugmaker Merck & Co. said it will cut about 8,500 jobs from commercial and research-and-development departments in hopes of reducing annual operating expenses by $2.5 billion by the end of 2015.

Merck is based in Whitehouse Station, N.J., and has operations elsewhere in New Jersey and suburban Philadelphia, including West Point and Blue Bell.

A Merck spokeswoman would not specify how many jobs would be eliminated at each facility or whether Phillyarea facilities will be shut entirely.

The company did say it was again changing plans for moving its headquarters, also in hopes of saving money.

Previously, Merck said it would vacate the Whitehouse Station office and move those people to an existing facility in Summit, N.J. The moving will start in 2014 and end in 2015.

WEEKLY BRIEFING

New Poll Shows Most Residents Support Liquor Privatization

BY KEEGAN GIBSON

Democrats largely oppose the measure, led by labor unions who represent employees of the current system.

But blogger Jon Getting of the left-leaning news and A poll commissioned by the conservative Commonwealth Foundation and the liberal website Keystone policy website Keystone Politics has challenged his ideoPolitics found that most Pa. residents support plans to logical compatriots on this issue, arguing that the current rules unfairly prop up incumbent businesses. liberalize the sale of alcohol in Pa. Legislative efforts to privatize the liquor stores stalled 61% agreed with a proposal to “end government sale and distribution of wine and spirits” in Pa. 33% said they in June but are likely to reemerge this fall. The biggest opposed it. 70% of Republicans and Independents were problem facing privatization proponents: few residents are frustrated enough with the current system to prioritize in support along with 54% of Democrats.

55% said they would be more likely to support a candi- privatization. Three-quarters of respondents in this poll date for state legislature who supports privatization, 32% rated the performance of current stores good or excellent.

13% rated them “not so good” and 8% called them poor. said they’d be less likely.

“That’s what I’ve noticed over the past few years of pollThe market research firm Heart+Mind Strategies conducted the survey of 1,151 Pennsylvania residents ages 21 ing this issue,” said Dr. Terry Madonna, Director of the and older from Sept. 3 to 12. The margin of error is plus Franklin and Marshall College Poll. “Majority support, but no high degree of intensity. It’s why there’s not a lot of or minus 3%.

The Commonwealth Foundation free market think tank pressure on lawmakers to act.”

This story was originally published in Politics PA at has long supported liquor privatization, as has Gov. Tom PoliticsPA.com.

Corbett and many Republicans in the legislature.

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WEEKLY BREIFING EXECUTIVE BOOKSHELF

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BUSINESS AND POLITICS

REGIONSBUSINESS.COM

Pa. Pension Reform Could Involve Lots Of Borrowing

BY ERIC BOEHM HARRISBURG — Pension reform will rise again in Pennsylvania next month.

A renewed effort to overhaul the retirement system for state workers and public school employees will focus on putting new hires into a new pension system while authorizing Pennsylvania to borrow billions on the bond market to staunch the rising unfunded liability threatening to swamp the state budget.

An unfunded liability is the gap between a pension funds’ assets and liabilities. Combined, Pennsylvania’s two pension funds have an unfunded liability of about $45 billion.

Within a few years, that liability will grow to more than $65 billion, based on the pension funds’ current expectations.

State Rep. Glenn Grell, R-Cumberland, will introduce a pair of bills that he said will form a “comprehensive approach” to the state’s pension problem.

His proposal would move all future hires into a new defined benefit system, a move intended to cut costs in the long-term. In the short-term, he wants to authorize the state to borrow up to $9 billion over the next three years to help pay down a portion of the $45 billion unfunded pension liability.

“This is similar to how we recently addressed the Commonwealth’s unemployment compensation debt to the federal government,” Grell wrote in a memo to fellow

lawmakers, in reference to the state borrowing $3 billion in 2011 to pay down a debt in the unemployment system.

Of course, the debt in the pension system is far higher, and the borrowing would be too.

Last Monday, House Majority Leader Mike Turzai staked out his position on pension reform during a speaking appearance at the monthly Pennsylvania Press Club luncheon.

He said there should be a new defined contribution plan for state employees hired after the reforms are passed. Defined contribution plans are similar to the 401(k) retirement options that have become so common in the private sector.

“It’s not a question of if, but when, the public sector keeps up and recognizes that the taxpayers cannot foot the bill,” Turzai said.

His position on the issue seems to mirror that of state Senate Republican leaders, a sign that progress may be possible though the issue remains a tricky one.

During the spring, Senate GOP leaders opposed part of Gov. Tom Corbett’s plan that would have reduced future benefits for current employees. They were worried that such a change to existing contracts would trigger a lawsuit — and public sector unions promised there would be one — jeopardizing any potential budget savings.

Erik Arneson, spokesman for Senate Majority Leader Dominic Pileggi, R-Chester, said the view from the Senate remains the same.

“Once you move all future employees into a 401(k)type plan, you’ve contained the problem,” he wrote in an email last week. “That provides some greater ability to consider options such as pension bonds and collars to help address the short-term cost spike.”

That’s where Grell’s plan comes in, with its proposed $9 billion pension bond.

Such arrangements can be tricky, too — Philadelphia borrowed $1.3 billion in 1999 to address pension debt, but soon relapsed on making payments, leaving the city with a high pension liability and bond debt on top of it.

Because governments have misused pension obligation bonds in the past, Moody’s has warned against their use.

Democrats have been nearly unanimously opposed to overhauling the public pension systems this year. They view the reforms passed in 2010 — which created a new, lower-benefit class for employees hired after that date — as putting the state on the right path and they are unwilling to support further changes.

Labor groups are already preparing to push back against the effort, too.

On Thursday, a report released by the Institute for America’s Future, a labor-oriented think tank, said groups like the Pew Charitable Trust were using the pension crisis to undermine retirement security for public sector workers.

This article was originally published in Pennsylvania Independent at PAIndependent.com.

3 OCTOBER 2013

POLITICAL COMMENTARY

REGIONSBUSINESS.COM

13

Journalism And Politics’ Revolving Door Is Troubling

Charlie Gerow is CEO of Quantum Communications, a Harrisburg-based public relations and issue advocacy firm.

CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com.

Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.

Philadelphia remembers Rick Stengel fondly.

During his time as President and CEO of the National Constitution he was an affable, effective and articulate leader. He guided the Center as the quintessential nice guy. He was never accused of very much; certainly never of being a conservative.

Stengel’s background was in the media. He was a journalist. He had been the national editor of Time Magazine. So it came as no surprise when Stengel returned to one of the largest and most recognizable magazines in the world, this time as the managing editor.

The more intriguing career move for Stengel came when he recently again left Time to join the Obama Administration as Undersecretary of State for Public Diplomacy and Public Affairs.

It wasn’t the first time he had left the magazine.

In addition to his move to the City of Brotherly Love he had also departed once before. That was to join Senator Bill Bradley as a speechwriter for his fledgling campaign for president. When that didn’t work out he returned to Time.

The revolving door between journalism and politics is not new, nor is it limited to one party. Even in the days of Honest Abe Lincoln, journalists found their way into the administration. John Nicolay left a small town newspaper in Lincoln’s home state to become a one man transition team for President Lincoln’s move into the White House. The first official act of his presidency was signing the appointment of Nicolay as his private secretary.

But the revolving door is now spinning at whirlwind speed. Some two dozen journalists have left the private sector to sign on to critical

posts in the Obama administration.

Douglas Frantz of the Washington Post went to John Kerry’s State Department along with Stengel. So did Glen Johnson who left the Boston Globe. Jay Carney, the most visible face of the Obama Administration, worked at Time under Stengel.

The list goes on and on. Shailagh Murray of the Washington Post joined the administration replacing Carney as Vice President Biden’s communications director. She was roundly criticized for continuing to cover politics while negotiating her deal with the White House.

Linda Douglass went from ABC and the National Journal to the Obama Administration as chief spokesperson on Obamacare then back to the National Journal. At the time she went into the administration, Ben Smith, then of Politico, said it was a “home run...for anyone who thinks the press is in the tank for Obama.”

Oh yeah, her husband is Obama’s ambassador to Italy.

The convergence of journalism in the media and politics in government is historic, relatively commonplace and has always run both ways (CNN’s chief National Security correspondent was recently chief of staff to Obama’s ambassador to China.)

But the Obama Administration has turned the practice into an art form which raises some disturbing questions.

If there were an equal number of journalists leaving their trade to enter the political fray it would be one thing. But when the ratio is more than 5:1 on the Democratic side it’s something altogether different. With the dramatic spike in

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travel from journalism to the Obama administration it’s unarguable that the revolving door opens to the left.

The ideological overlap of the national media and left-leaning politics is well documented.

When conservatives complain about media bias it’s because it exists. A recent Gallup poll reiterates what previous surveys have found.

Nearly 50% of Americans believe the media is too liberal while only about 10% see it as too conservative. A majority of Americans say they have little or no trust in the media to report the news fully, fairly and accurately.

It’s inescapable that there is at least some degree of using their perch as an “objective” reporter to either advance the prospective employer’s positions or burnish their own credentials and compatibility with the administration while looking for a job. Ari Fleisher, a former White House Press Secretary, recently observed, “You cannot imagine how unnerving it is to talk to a reporter who is asking a ‘neutral’ question about a GOP vs. Democrat policy/ political matter only to see that reporter join the Administration.”

Using the media as a feeding system for political spokespersons and communications advisors is risky business. Blurring the lines between journalism and politics does damage to both.

At a time when faith in America’s institutions— both the media and government—is low and sinking, it’s especially important to maintain integrity and assure that the reading and viewing public is not confused by an editorial page running the front page or a future employer directing the writing of a reporter.

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3 OCTOBER 2013

POLITICAL COMMENTARY

REGIONSBUSINESS.COM

Government Shutdown: Don’t Cry For Federal Employees

Eric Boehm is bureau chief for PA Independent, a project of the Franklin Center for Government and Public Integrity

CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com.

Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.

The federal government shut down.

But the sun still rose, the welfare checks still got delivered and the trains still ran on time — or as close to on time as Amtrak ever did.

So, I’m not too worried about the prospects of a gridlock-induced government shutdown.

It’s not that I’m unsympathetic to the 70,000-or-so Pennsylvanians who make their living working for the federal government and are unsure when they might get their next pay check. But at the same time, I’m not really too sympathetic towards them either.

For starters, that is a risk that comes with any job in the public sector. All jobs have risks.

And as occupational hazards go, a week or two of unpaid vacation is hardly at the top of the list.

But there’s another reason to not be too sympathetic to the federal workers who aren’t collecting paychecks this week. While the rest of the country has experienced what is essentially a “lost decade” in earning potential, those living off the lifeline of the federal government keep getting richer.

New data from the U.S. Census Bureau confirms this point. The four richest counties in the United States are now located in the

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Washington, D.C., metro area. The region around our nation’s capital boasts nine counties with an average income of more than $100,000.

While housing prices in most of the country are still at or below their pre-recession levels, the D.C. housing market is one of the fastest growing. And to count yourself among the “1 percent” in Washington, you’d have to pull down a cool $600,000 a year.

So forgive me if I’m not shedding a tear over a brief interruption in the engine that sucks all that wealth from the pockets of Americans to the pocketbooks of those in the Capital City.

Of course, it’s not just the D.C. bureaucrats who are getting rich. It’s all federal workers, everywhere.

It’s also the lobbyists, the palm-greasers and the hangers-on who can live off the largesse of the nation’s capital while the rest of America staggers back to its feet from the worst economic downturn in decades.

But outside of the D.C. beltway the government shutdown is hardly the cataclysmic event it is sometimes portrayed as.

Social Security checks are still being delivered by the U.S. Postal Service, which is

still operating. Medicaid and Medicare are still functioning normally. Nearly all employees of the Defense Department, including those running the NSA’s electronic surveillance programs, will keep working through the shutdown. So, too, will the 16,000 FBI agents at 56 field offices around the nation.

According to the New York Times, “most” State Department employees will continue to work, as will “more than half” of the bureaucrats at the Department of Health and Human Services.

And here in Pennsylvania, the state government will carry on as well.

“It’s business as usual,” Jay Pagni, the spokesman for the governor’s budget office, told me on Monday as the shutdown was looming.

Though Pa. expects to receive $21.7 billion from the federal government this year — that’s about one-third of all the money spent by the state — there is no immediate sense of concern in Harrisburg.

If anything, state officials are gleeful that another government body is more disorganized than the Pennsylvania General Assembly.

For now.

3 OCTOBER 2013

REGIONSBUSINESS.COM

2013: YEAR OF THE INNOVATOR

15

The Woman Behind Pure Barre’s East Coast Expansion

Noelle Zane opened the Pure Barre fitness studio in Center City in 2010, followed by locations in Wayne, Pa., and Haddonfield, N.J..

BY BRANDON BAKER The fast-paced and female-targeted Pure Barre fitness technique has become something of a phenomenon since its franchise introduction in July 2009 by Carrie Rezabek Dorr — it’s the cliché but true-all-the-same narrative of the fitness guru blossoming a business from her basement to a national brand with more than 100 studios.

Three of these studios are owned and managed

by Hershey, Pa.-native Noelle Zane, who opened up shop in Center City in 2010.

Prior, she had lived the life of the Nashville-based triple threat: the singer, the writer and the dancer.

But when she heard rumblings of an on-the-rise fitness technique being developed — and a location for the technique opening in the city — she quickly hopped on board, making a name for herself as the go-to instructor for the site.

From there, she understood that she was the ideal candidate to launch the thighs-, abdominals- and arms-oriented fitness program on the East Coast.

“For me, it was a combo of putting all of my loves together — I was a singer, a dancer, I was a theater major in college and I always wanted to open my own business. So it was putting together all of these experiences,” Ms. Zane said. “And I knew Carrie [from my training], and when I was talking to her one day, I was telling her about how I was

Steadily, but almost quietly, Philadelphia has become a hotspot for entrepreneurs.

The combination of great ideas, available capital and a welcoming environment have set the stage to make 2013 a breakout year for innovation and new businesses. interested in [launching on the East Coast]. After that, everything grew so rapidly.”

Ms. Zane launched the three locations just as Pure Barre was transitioning into a franchise.

Today, the program is offered in three locations throughout the region: Center City, Wayne, Pa., and a Haddonfield, N.J., location that opened in May. Between the three locations, Ms. Zane said she manages 25 employees — 20 instructors, and five receptionists. Ms. Zane hopes to open a new location once the dust settles with the brand-new South Jersey location.

The region’s studios are currently offering a 30-day, unlimited $100 trial for women interested in testing the one-size-fits-all fitness classes – which, Ms. Zane emphasized, she still finds time to teach herself.

To Learn More ...

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16

2013: YEAR OF THE INNOVATOR DIARY OF A STARTUP

The Key To Startup Success Is Conviction

3 OCTOBER 2013

REGIONSBUSINESS.COM

Two-Thirds Of DreamIt Ventures Philly Startups Are No Longer In The City: Why?

Healthincentive startup LifeVest Health, which allows users to literally wage bets for and against their health, is brimming with folks who know what it feels like to jump ship from the nine-to-five lifestyle in favor of the rocky waters of the startup world. One of these man-overboard entrepreneurs, co-founder Mike Logsdon, recalls a recent moment of truth that speaks to what drove him to the company.

In his words: Amid a semi-sanity brought on by a mix of West Nile virus, morphine, and the worried looks of my doctors, it seemed a bit ironic that the last thing I had read was Paul Graham’s talk from a 2007 Y Combinator dinner, “How Not to Die” — a talk that gave budding startups motivation to never give up, even in the face of startup death.

Unfortunately, facing the real possibility of death, not just a startup-metaphorical one, Mr. Graham wasn’t so helpful on the infectious disease front.

In between spinal taps and cups of prune juice, I reflected on my decision to quit a secure job, leave a regular paycheck, throw all my possessions in a U-Haul, and dive into the certainty of uncertainty that is startup life.

Why did I make such a decision? In a word: conviction.

D.L. Moody once said, “My biggest fear is succeeding at something that doesn’t matter.”

When Jon came to me with the early concept for LifeVest, I was fired up. It was not an idea as mind-blowing as caffeinated beef jerky, which is deliciously bizarre, but then, jerky’s not changing lives. LifeVest can.

So, while the lessons of “How Not to Die” certainly apply as much to LifeVest as to any other startup, there’s an equally important counterbalance, which is how to live. Not unlike my two weeks in the hospital with West Nile, solving weighty problems can be painful at times, but the payoff is more than worth it.

Venkat Jonnala (right) and Jean-Mathieu Chabas, who cofounded DreamIt Ventures company Zenkars, said they’ll stay in the region if they find investors here.

Photo by Alyssa Cwanger for Wharton Entrepreneurship.

TECHNICALLY PHLLY

BY JULIANA REYES DreamIt Ventures has spent the last five years developing one of the country’s best-respected early-stage high tech startup acceleration programs.

It set out with a goal of helping startups get off the ground.

Now it’s set its sights on another problem: how to keep its startups in the region.

Since its launch in 2008, about one-third of the 66 companies that participated in DreamIt Ventures’ five Philadelphia cycles stayed in the city, according to DreamIt Ventures data and an analysis by Technical. ly Philly.

Of those 66 companies, about two-thirds are still active.

Startups come from all over the country and even outside of DreamIt to join the program, which takes a cut of equity in exchange for a short-term stay, a network of mentorship and investment and limited capital of less than $15,000.

Since its launch, DreamIt Ventures, backed in part by state money from Benjamin Franklin Technology Partners, has focused on developing the local technology community, said cofounder David Bookspan.

“When we started, we wanted to give back to the community in Philadelphia,” said Mr. Bookspan, who sold his Wayne-based online court records company MarketSpan in 2000 for a reported $35 million to a company later acquired by LexisNexis.

Today, Mr. Bookspan said, the goal still stands, in Philadelphia and in DreamIt’s other host cities, like New York City, Austin, Tel Aviv and now Baltimore.

It’s also important to note that, though civic pride runs deeply here, a startup accelerator traditionally has a commitment to making better businesses, not making them stay somewhere.

DreamIt founders sought out to make a world-class tech startup program and that goal has largely been met.

Still, the struggle to keep startups here continues.

At DreamIt’s December 2012 demo day at World Cafe Live, Bookspan emphasized the importance of early stage capital in retaining DreamIt’s startups.

Look at the numbers, he said: out of Philly’s 2011 DreamIt class, nine startups out of 12 initially stayed, but two of the nine companies eventually left because they received investment outside of the region.

Of the 14 startups from the last Dreamit class, three were from Philadelphia originally and at least two are still here, though Wharton-based Zenkars, an online used car retailer that won the Wharton Business Plan Competition is no certainty. It’ll follow its investors, cofounders told Technical.ly Philly.

That can be a challenge. Though there are clear changes afoot, Philadelphia has traditionally underperformed in risk-heavy investment, particularly in the city.

DreamIt is keenly aware of the issue, Mr. Bookspan said, and is working on a number of efforts, which he said he could not announce yet, to keep its startups in the city.

“We demonstrated that [these startups] will come to Philadelphia to launch their companies,” he said.

“What we need to do now is to make Philadelphia a place they want to stay.”

This article was originally published in Technically Philly at Technical.ly/Philly.

2013: YEAR OF THE INNOVATOR

3 OCTOBER 2013

REGIONSBUSINESS.COM

17

Clear Communication Is Vital When Running Business

Kelly Walsh is the creator and owner of 1 Smart Life, LLC , a personal coaching service. She can be reached at kelly@1smartlife.com.

CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com.

Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.

Your phone screen lights up as a news notification appears: “President gives address from White House.”

Turning to your computer to launch the Internet browser, you’re greeted by a homepage full of headlines saturated with disaster, destruction — and, of course, “shocking” reality TV revelations.

A perfunctory glance at Facebook finds the social media sector awash with heated discussion about the latest high-profile trial.

All this, and you’ve only been sitting at your desk for three minutes.

As technology has become more omnipresent, so too has media coverage of current events, turning them into consumable sound bites and one-line blurbs to be shared, retweeted, and dropped into conversation.

With Google Alerts and social media feeds cropping up throughout the day, political and diplomatic concerns have become a constant presence in the workplace, giving us all ample time to internalize the atmosphere of confusion and speculation that can accompany recent events such as the Syrian conflict and government shutdown.

The influence of this constant, rapid-fire reportage extends beyond the obvious, affecting your professional life in surprising ways as parallels emerge between your company’s internal affairs and our country’s international affairs.

Whether the context is corporate or diplomatic, there’s no denying the power of the rumor mill to generate bouts of misinformation-driven panic.

The mechanism at work is the same when you’re anxiously wondering how much truth is in the rumor about departmental downsizing as when you’re reading online commentary debating Assad’s next move.

There may be some credibility in either case, but the speculative nature of that kind of “news” leaves plenty of room for unfounded assumptions and good old-fashioned gossip, too.

Rumors and conjecture have a way of taking root in the absence of direct, fromthe-source statements, and it’s a dangerous fact of human nature that gossip is often just as, if not more, compelling than truth.

That’s why it’s so important, in the business realm as in many others, to communicate news and relevant information promptly, clearly, and responsibly. Rumors

are only natural, but to avoid widespread misconceptions about the state of affairs within your organization, make sure leadership personnel are prepared to dispel them before things get out of hand.

To that end, it’s just as essential that company leadership present a united front in providing accessible and reliable information for employees — and outside interests.

Such a precaution will ensure that, when it comes to the big issues, there’ll be little room for misinterpretation, and therefore less cause for unpleasant surprises.

Just think back to recent developments in foreign affairs: the existence of a chemical weapons arsenal in Syria was still being considered “questionable” in

CUT THROUGH THE NOISE OF CONJECTURE AND CONFUSION WITH CLEAR DIRECTIVES, DECISIVE ACTION AND CONSIDERATION FOR THE INPUT OF YOUR PEERS. DO THAT AND YOU’LL BE MILES AHEAD OF YOUR POLITICAL COUNTERPARTS.’ U.S. media mere weeks ago, despite the fact that French and British teams had confirmed the use of Sarin gas as early as June. Lacking a decisive word on the matter, many Americans couldn’t have predicted two months back that the question of military intervention would be raised.

Mixed information opens the doors to mistrust and confusion in a professional setting as well, so it’s vital to make internal materials, such as policy information, memos, career ladder info, and even severance plans accessible to employees.

Communication is one of those professional ideals preached more often than practiced.

In theory, employees of all levels should understand what effects company-wide developments will have for them, but the reality is usually far from that.

Our own political reality, too, is far from achieving that kind of transparency. A habitual refrain from the American public in response to legislation and governmental policy is, “How does that affect me? What does that mean for me in my everyday life?”

The answers to those basic questions often get lost amidst complicated jargon and vague or biased statements from one contingent or another, and the results aren’t at all conducive to a well-functioning democratic process, much less a productive business.

The responsibility for communication is two-part: it’s up to leadership figures to clearly articulate goals, policies, and their possible results, but it’s equally incumbent upon employees to educate and inform themselves.

Most importantly, all should listen to each other.

The need for candid dialogue and intellectual freedoms is universal, and the consequences of ignoring this need can be seen playing out on a horrific, international scale in current media coverage.

In order to prevent disagreements of a personal or ideological nature from becoming antagonistic, cultivate a culture of openness in the workplace, encouraging forums for spirited discussion and constructive criticism.

Genuine feedback should be valued and rewarded, and you should remember that, even if you’re in a position of authority, giving explanations for your own views is conducive to honesty and productivity, and will humanize, rather than undermine, you as a leader.

In addition to encouraging public forums for dialogue, provide resources for safe, private conversations. Make sure everyone is aware of the availability of HR and employee relations staff members for confidential conversations and promote an open-door policy. No one should have misgivings about approaching you with their concerns.

Occasional confusion, dissent, and even conflict are inevitable components in any collaborative process, but the way you handle these issues — with respect and candor — will determine the success of your leadership.

Cut through the noise of conjecture and confusion with clear directives, decisive action, and consideration for the input of your peers.

Do that and you’ll be miles ahead of your political counterparts on this one.

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3 OCTOBER 2013

2013: YEAR OF THE INNOVATOR

REGIONSBUSINESS.COM

Startup Spinoff Solves Retail Turnover Woes

? la n rP ou

Alex King is determined to expedite his climb up the rungs of the entrepreneurial ladder, with a new venture to jumpstart that effort.

In May 2008, Mr. King opened shop with tech problem-solving and design shop Defined Clarity – just ahead of the trend of app and Web developers that fill the startup space today. But because of the servicebased nature of the company, its scalability was, he admitted, limited.

Wanting to expand the reach of his business, he created gatherDocs: a spin-off company of Defined Clarity and an applicant-tracking software solution for businesses in the hiring process.

“We started building gatherDocs because we realized there was a space needed for retailers, in regards to trying to fill various positions — from cashiers, to assistant managers. There’s a lack of core systems that fit the features these businesses seek,” Mr. King said.

Y

BY BRANDON BAKER

“Traditionally, retailers experience high-turnover, so they constantly look for warm bodies; we built our system to cater toward that market, and we’re able to do that because of our [software-building] experience with Defined Clarity.”

The company, bootThe gatherDocs team in their Northern Liberties office. strapped by Mr. King, CMO Bruce Marble and CTO Dan Lopez, is about a year into its lifespan. Mr. tions to make the process seamless for job applicants.

King said the client he’s — thus far — most proud of Moreover, it eliminates the cost of paper applications is sports-retailer Villa, which has 70 locations around for retailers while giving them an easily sorted and navithe country, including stores in Philadelphia, Chicago gated digital pool of potential employees. For example, retailers can filter applicants by their hourly availability and New York.

“With GatherDocs, our mission is to become the and location.

GatherDocs, based out of Northern Liberties and leading mobile hiring platform for retailers and servicebased organizations, and we’re going to do this by driv- an employer of five, is currently offering a 14-day ing down the costs it takes for them to replace each new free trial for retailers. The application itself is free employee,” Mr. King said. “We’re saving our customers for applicants.

Mr. King is seeking to raise an angel round of funding time and money.”

The application is optimized for mobile applica- this fall to scale its operations.

W ha t’s

Company: gatherDocs Founders: Alex King, Bruce Marble, Dan Lopez Contact: alex@definedclarity.com

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WHAT WE’RE JUGGLING The Pennsylvania Chamber of Business and Industry released its latest Economic Survey and, though business-owners show slight signs of optimism in some areas, it’s still clear that there are issues — like healthcare and transportation — that need to be resolved before the economy at large will turn around.

STORY BY MELISSA DANIELS ILLUSTRATION BY DON LEE

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BY THE NUMBERS

38%

ONE IN FIVE BUSINESS OWNERS... SEE THE OVERALL ECONOMIC CLIMATE OF THE COUNTRY AS A PROBLEM. THIS IS IN SPITE OF THE FACT THAT ONE IN FOUR SAY PENNSYLVANIA’S BUSINESS CLIMATE HAS IMPROVED.’

Pennsylvania business owners that expect sales to increase in the coming year, according to the Pennsylvania Chamber of Business and Industry’s 23rd Annual Pennsylvania Economic Survey

20%

Pennsylvania business owners that expect hiring to increase

25%

Pennsylvania business owners that think the state’s business climate has improved

With a government shutdown and the cost of Obamacare threatening, uncertainty is keeping optimism from taking center stage for Pennsylvania business owners.

More business people see the economy improving than at any time since 2007, according to an annual survey taken by the Pennsylvania Chamber of Business and Industry.

A five-year high of 38 percent of those owners expect their sales to increase.

Another 20 percent expect to hire more employees in the coming year.

But for every glimmer of hope revealed in the survey, conducted in partnership with The High Center for Family Business, there is foreboding.

One in five business owners polled continued to see the overall economic climate in the country as a problem. This in spite of the fact than one in four say Pennsylvania’s business climate has improved.

“This is strong evidence that the recession still haunts many employees,” said Jim Lee, president of Susquehanna Polling and Research.

Justin McClure, president of DaFlure Heating and Cooling, a Cumberland County mechanical construction contractor, said the tepid housing recovery, rising gas prices and utility costs have been a challenge.

“The contraction in the economy has created, in my opinion, an overly saturated marketplace,” he said. “It’s hard to keep people employed, and it’s hard to find margins as costs go up.”

Central Pennsylvania is positioned as well as anyone, but I think the whole state is lagging on the rebound.”

Federal Indecision

Gene Barr, president of the Pennsylvania Chamber of Business and Industry, said business people in Pennsylvania are not comforted by decision-makers in Washington, D.C. “We saw things getting a little better here, people feeling better about Pennsylvania,” Mr. Barr said. “Unfortunately what happens on the national side of things of course clearly impacts us here in Pennsylvania.”

Richard Dennis, owner of Die-Tech, a metal stamping company based in York County, said the government sends mixed signals touting high tech manufacturing but failing to support it by funding job training programs.

Die-Tech has survived, Mr. Dennis said, by branching out from electrical industries to supplying medical and military parts.

Manufacturers in the state are “fighting for their lives,” he said “It’s one thing to talk, to tout programs,” he said. “It’s another thing to put money into them.”

Ask Mr. Dennis the one thing he hopes to see the government do in the next year and the answer is simple: “Just let business do business.”

Health Care Costs

More than two-thirds of Chamber members and six in ten non-members said the organization’s top legislative priority should be controlling the costs of health care.

Sixteen percent who responded to the poll said health care costs is the number one issue facing their businesses. Approximately 74 percent said they offer health insurance and, of that group, 79 percent saw their premiums increase in the last year.

Those premium increases will have to managed by cutting costs in other areas or offering less coverage. Some may choose to forego health care altogether.

“In many cases, it will be cheaper to say to your employees, ‘You go on the exchange and I’ll pay the penalty,’” Barr said. “It may be cheaper for them to do that.”

By the start of 2014, businesses will be

20%

Pennsylvania business owners that see the overall economic climate in the country as a problem

35% Pennsylvania business owners that reported increased sales in the last year

64%

Pennsylvania business owners that cited “controlling cost of health care” as a top issue

53%

Pennsylvania business owners that consider their company a “family business”

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3 OCTOBER 2013

REGIONSBUSINESS.COM

required to offer health care or face government penalties. Businesses who do not offer health insurance and have more than 50 employees will owe $2,000 times the total number of employees minus 30. The penalty could increase, as it is tied to rates of health insurance premiums.

Businesses who currently offer insurance could face penalties, too. If the employer fails to pick up at least 60 percent of the cost, or if the cost to employees is more than 9.5 percent of their family income, the penalty is $3,000 for each employee who becomes individually insured via the health insurance exchanges.

As far as obtaining health insurance goes, the federal government recently delayed online implementation of a small-business oriented health exchange.

Forecast For The Future

Nearly a third of business owners responding to the survey before the recession predicted they would hire more employees in the coming year.

Today, according to the survey results, one fifth of the owners are that hopeful.

Mr. Dennis said it has been tougher to hire the necessary skilled labor. He began doing more internal training to help make up the difference.

“All the demographics, all the data I obtained, there wasn’t going to be

enough of the type of people to do the kind of work we’re still doing in this part of the country,” Mr. Dennis said.

“A lot of those people have just opted out of this industry.”

Transportation

While 15 percent of business owners said funding transportation infrastructure should be a top legislative priority

All In The Family

WE KNOW WE NEED [TRANSPORTATION]. AND YOU WILL RARELY HEAR US ASK FOR MORE STATE SPENDING ANYWHERE.’ —GENE BARR, PRESIDENT OF PA CHAMBER OF BUSINESS AND INDUSTRY

and while the Chamber supported the Senate passing a $2.5 billion budget increase earlier this year, the House has so far balked.

Funding public transportation systems is a critical sticking point in the legislative debate. House Republicans, in their proposals, have offered less to support bus and rail services than the Senate package.

Mr. Barr said the Chamber supports seeing improvement to mass transit.

“Our members, particularly in metro

Funding public transportation systems is a critical sticking point in the legislative debate.

areas, need a way for people to get to work,” Mr. Barr said.

Overall, transportation funding is a top legislative priority for the chamber this fall session.

“We know we need it. And you will rarely hear us ask for more state spending anywhere,” Mr. Barr said.

As for how much more, the Chamber would take “whatever we can get.”

This year’s Chamber survey revealed new data about familyowned businesses.

For the first time, businesses were asked whether they considered themselves family owned. Fiftythree percent said yes.

Almost all family-owned businesses, around 91 percent, said they had family control for one to three generations. More than half said they planned to keep the business family owned in the immediate future.

But the logistics and details behind that succession may not be clear. Just 38 percent of familyowned businesses said they had a formal management succession or transition plan.

Michael Mitchell, executive director of The High Center for Family Business at Elizabethtown College,

(FLICKR.COM/ORCHIDTHIEF)

said that statistic was a concern, because few businesses stay in the family from one generation to the next.

Statistics from Forbes Magazine say less than a third of businesses survive the transition from first to second generation.

“One of the possible causes of these low transition rates is the lack of proactive implementation of proper governance and succession planning,” Mr. Mitchell said in a release.

Mr. McClure, who took over DaFlure from his father, agreed that coming up with succession plans are a major challenge. Some families may not have a son, daughter or relative interested or old enough to take over the business.

“My dad was one of those guys that said, “We’re gonna put in the best person to fit that position, not just a family member,’” he said. “Parents have that challenge where non-family businesses don’t.”

The survey offered hard numbers to back up a common concept — that family owned businesses tend to be smaller. Out of companies with less than 50 employees, 58 percent identified as small business.

The same was true for 27 percent of companies with more than 50 employees.

This article was originally published on Pennsylvania Independent at PAIndependent.com.

Q&A

3 OCTOBER 2013

REGIONSBUSINESS.COM

23

DREAMIT VENTURES:

REFINING STARTUPS

Steven Welch, founding partner of DreamIt Ventures, is no stranger to the healthcare sector. At the age of 23 he founded Mitos Technologies which is responsible for the systems that manufacture flu shots and high-end biological drug treatments.

With healthcare reform on the way, the emphasis on healthcare innovation is as important as ever — especially in Philadelphia.

Mr. Welch spoke with us at DreamIt Health’s Demo Days to expand on what a healthcare startup will need to succeed.

(Photo by Marissa Hu for the Wharton Entreprenuership Blog)

What’s the elevator pitch for DreamIt Ventures and DreamIt Health?

We help extraordinary people build great companies and we do that with a very intense three month period where we take a team and idea, and force them to fail or succeed with a small amount of capital. We give them the resources they need — mentors who are beenthere-done-that entrepreneurs, $5,000 for the company, plus $5,000 per founding member.

We then give them the ability to test their idea.

We have the DreamIt Methodology which is a combination of “Lean Startup” and what we call “Thin Wedge.” We’ve been able to launch 102 companies which have gone on to raise over $90 million. We have a really good methodology and the core of that is bringing in the best people and surrounding them with the resources they need.

Dreamit Health is unique in the fact that we have partners here with Independence Blue Cross and Penn Medicine. They’re two of the leading organizations in healthcare. The ability to have entrepreneurs come in and have access to those partners really allows them to do things they wouldn’t be able to do on their own.

With healthcare reform coming up, how important is it for businesses to pay attention to these small healthcare startups?

Certainly smaller organizations tend to be the most innovative. I think it’s likely that the changes you see will be a collaboration between larger corporations like Independence Blue Cross and Penn Medicine, but also between the startups that no one’s ever heard of today.

What’s the most important facet of DreamIt Ventures/ Health for startups that enter?

We’re trying to help them refine their idea and most importantly understand if there’s a market need for that idea.

Due to my nature and my background, I go to the grocery store and someone wants to tell me about an idea they have.

Most of the time, an idea really comes down to two or three, maybe four or five things that, if they’re true, that idea’s good.

But if not, you’re in deep shit.

We’re trying to help them refine those ideas and find the core assumptions that have to be true, but then give them ways to test it without spending a lot of money, which is very different from the way the world has worked historically. Typically, companies used to build products and then customers would come. We’ve switched that to getting the leanest product in the market and see if there’s a market there. If there is, then you continue to pour on and build up for the future.

What advice would you have for startups in the healthcare field or in general?

In this environment we’re in, it’s going to be collaborations that are going to be the key to success. No one entity is going to tackle all of the problems we face. But I think companies that figure out how to collaborate with smaller organizations, other startups, they’ll be the ones that will be successful.

DreamItVentures.com

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3 OCTOBER 2013

FINE ESTATES PREVIEW

REGIONSBUSINESS.COM

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This Main Line treasure is one of a kind offering, a special piece of history and will offer a lifetime of memories.

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3 OCTOBER 2013

REGIONSBUSINESS.COM

REAL ESTATE

25

‘Tactical Urbanism’ Comes To Girard — With A Fence?

BY GREG MECKSTROTH

Kensington Community Development Corporation (NKCDC), It can host a food truck also includes storefront improveextravaganza or an impromptu ments to four businesses.

So yes, the ‘fence’ idea sounds First Friday gallery show. It’s an interactive... fence and it is a key a bit vague, but we’re guessing feature of a high-impact, low- it’s going to be a hit for the evercost “Model Block” program that evolving and currently exploding will be revealed along Fishtown’s East Girard corridor. If you want East Girard Avenue in the coming to check it out first hand, on Wednesday, October 2, at 10:30 days.

It’s the latest tactical urbanism a.m., the fence and storefront initiative that is taking hold all improvements will officially be over Philly, which is characterized unveiled. At that time, folks from by community-focused, short- NKCDC, LISC and PNC will term, small-scale interventions discuss how the “Model Block” with realistic goals for improving program is designed to jumpstart smaller urban areas and improv- revitalization along East Girard as well as a new marketing proing quality of life on the cheap.

The program, which is funded gram for the neighborhood.

This article was originally by a $98,000 grant from the PNC Foundation and delivered published on the Philadelphia by the Local Initiatives Support Real Estate blog at Blog.PhilaCorporation (LISC) to the New delphiaRealEstate.com.

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OPINION

Rebooting Congress: The Only Way To Efficiency

Stephen Tryon is a former fellow in the office of Senator Max Cleland, and is current Senior Vice President at internet retailer Overstock.com and the author of Accountability Citizenship.

Here we go again.

Congress is warming up for its “dysfunctional” dance — you know, the one where members of each party blame the other party, the government is either not funded until the last minute or is funded a few weeks at a time or actually shuts down for a week or two, and our elected representatives and senators do their best to make simple things look hard.

Imagine that you paid your electric bill in advance, only to have some bureaucrat at the power company tell you he was turning off your power because he didn’t like the fact that most of the power was being generated through coal-fired plants.

I don’t think any of us would stand for that.

Even though we all have our opinions on the merits of sustainable energy versus fossil fuels, those opinions are beside the point: when you pay for power in advance, it isn’t right for the power company to turn off your power because of some philosophical debate.

Well, if you are like most Americans, you settle your account with the Internal Revenue Service each April, and your employer is sending the government part of your paycheck every month to pay your tax bill.

How is it right for some group of bureaucrats to threaten to turn off your government

THE NOTION OF SHUTTING DOWN THE GOVERNMENT TO ACHIEVE SOME OUTCOME THAT IS SUPPOSED TO BE ACHIEVED AS A RESULT OF ELECTED OFFICIALS DOING THEIR JOBS EACH DAY IS FUNDAMENTALLY FLAWED.’ —STEPHEN TRYON

CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com.

Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.

services because they have failed to resolve their philosophical differences in a timely manner?

The fact is that it is neither right nor necessary for Congress to engage in this dysfunction.

Thirteen appropriations bills will fund the government in fiscal year 2014 (October 1, 2013 through September 30, 2014). Those bills should have been passed before the August recess. If the work wasn’t done, then

Congress should not have taken summer vacation. They should have stayed in session until the work was done.

The only reason the work didn’t get done is because the members of Congress didn’t want it to get done.

They wanted the political drama we are witnessing now because they believe this drama will help them win some philosophical debate about the size, scope and activity of government.

Collectively, they are betting that voters will forget how Congress played chicken with your money by the time they stand for re-election next year.

Individually, each will tell you that the failure to complete the appropriations bills on time is someone else’s fault. In fact, every member of Congress is responsible for this failure.

The way to restore a government that completes its work on time is to fire the 468 members of Congress who will stand for election in November of 2014.

If every one of us voted against incumbents in the 2014 election, we would replace 87 percent of Congress. If we did that, I am willing to bet that the 2016 budget would be done on time.

The notion of shutting down the government to achieve some outcome that is supposed to be achieved as a result of elected officials doing their jobs each day is fundamentally flawed.

Americans don’t have the option of shutting down their checking accounts when the check to the IRS comes due.

For any member of Congress, regardless of party, to hold the American people hostage because the members collectively cannot effectively legislate is unacceptable.

Replacing 87 percent of Congress in November of 2014 would effectively “reboot” our government. I believe such a reboot would be the best way to restore effective government.

Don’t you?

29

3 OCTOBER 2013

REGIONSBUSINESS.COM

OPINION COMMENTARY FROM ACROSS THE WEB

GOP On Suicide Mission With Shutdown Ultimatum

here to stay.

The nation once again found itself held hostage this weekend, as Congress careened wildly toward a shutdown at midnight last night.

The circular firing squad that led federal government shutdown in two decades is the inevitable product of a governing system whose principals are no longer talking to each other, but past each other.

We know, you’re shaking your head. You can’t believe we are doing this again. Neither can we.

And the inevitable losers, of course, are the voters who sent these clowns to Washington in the first place.

Like a recurring nightmare, the ultraconservative tea party faction of the House Republicans is once again threatening to shut down the government if the White House doesn’t knuckle under to its demand to strip President Obama’s health care law of financing.

If a shutdown goes more than a couple of weeks, it would rub up against the Oct. 17 deadline for raising the federal debt ceiling.

This may seem like a political winner for the 40 or so tea party lawmakers in the House leading the charge against the health care law, but it’s wrong for their party and wrong in every other respect. The only proper response to this political ultimatum is “no.”

The health care law is not perfect.

President Obama has acknowledged as much. The transition period will be particularly difficult. Change always is. But holding the government hostage to demands that the law be killed outright or delayed is not the way for lawmakers to deal with the challenge of implementing a new program.

The truth is this standoff never should have gotten this far. A Republican Party that controls one half of one third of the government cannot override the majority.

Trying vainly to do so may seem like good politics, but it isn’t. It’s a suicide mission.

DELCO TIMES 30 SEPTEMBER 2013

The Losers in Shutdown Are The Voters

Such a move would not increase federal spending nor would it decrease it. What it would do is allow the U.S. Treasury Department to fill the gap between the money it¹s legally entitled to collect and the amount it¹s required spend.

No #shutdown here! Our friendly lil’ faces are still here to welcome you. @ADVENTUREAQUA

@SolomonJones1

What this means in practical terms is that a shuttered government could default on its debt obligations, potentially driving the economy back into recession.

Threatening govt shutdown = taking your toys and going home. There’s just 1 problem. The govt is not your toy. #growup

Which brings us back to where we started: Living with a broken system where ideology trumps common sense and the fight to regain or maintain power trumps everything else. And the loser is always, always you.

@VisitPhilly

30 SEPTEMBER 2013

Visitors, good news: the National @ConstitutionCtr will remain open during government #shutdown with regular museum hours.

JOHN L. MICEK — PENNLIVE.COM

1 OCTOBER 2013

1 OCTOBER 2013

@AntDeRosa

Come 2014, Throw All The Bums Out!

The partial government shutdown will delay the release of nonfarm payrolls data on Friday 1 OCTOBER 2013

Congress has failed us one time too many.

Egomaniacs reading children’s stories when they run out of anything intelligent to say should stop wasting our precious time and just resign.

Right now we need to start encouraging reasonable, rational and common sense citizens in our community to put their hats in the ring for Congress in 2014.

Hate what happened in Washington on Monday? Get used to it. Partisan gridlock is

REGION’S BUSINESS A JOURNAL OF BUSINESS AND POLITICS © COPYRIGHT 2013 INDEPENDENCE MEDIA 350 SENTRY PARKWAY, BLDG. 630, SUITE 100C BLUE BELL, PA 19422 (610) 572-7112 | WWW.REGIONSBUSINESS.COM

JOHN FEATHERMAN — PHILLY.COM

@Michael_Nutter Pres @BarackObama is making the case for how IRRESPONSIBLE it is to shutdown Fed govt based on the unreasonable actions of some in Congress.

30 SEPTEMBER 2013

@mattyglesias

The National Capital Planning Commission is shut down, so this is your

30 SEPTEMBER 2013

CONTENT PARTNERS

chance to hastily build a skyscraper downtown.

1 OCTOBER 2013

@christopherwink 97% of surveyed @uwishunu readers did an action (went to event or restaurant) after reading content. Could a news site even have third that?

30 SEPTEMBER 2013

@MikeVick Long season ahead. Have to keep pushing #Birds 30 SEPTEMBER 2013

@rubinafillion The #BreakingBad finale generated 1.5 million tweets - about 3X as many as Sunday night football.

30 SEPTEMBER 2013

@BryanCranston Well, this is it. The last episode ever of Breaking Bad. Thank you for sharing this ride with me. Without you we never would have lasted.

29 SEPTEMBER 2013

30

3 OCTOBER 2013

REGIONSBUSINESS.COM

BY THE NUMBERS

13%

800,000

Government employees furloughed in the Department of Homeland Security

Of more than two million federal workers deemed non-essential could be furloughed during the shutdown, according to government estimates

81%

Government employees furloughed in the Department of the Interior

87%

96%

Government employees furloughed in the Department of Commerce

Government employees furloughed in the Environmental Protection Agency

94%

52%

Government employees furloughed in the Department of Education

Government employees furloughed in the Department of Health and Human Services

69%

84%

Government employees furloughed in the Department of Energy

51%

Voters said they will blame Republicans in Congress “a lot” for a government shutdown, according to a recent poll by The Morning Consult

33%

Voters said Congress should delay, defund or repeal the healthcare law

Government employees furloughed in the Department of Justice

82% Government employees furloughed in the Department of Labor

98.5% Government employees furloughed in the National Science Foundation

41%

50%

Voters said they will blame President Obama “a lot” for a government shutdown

Government employees furloughed in the Department of Treasury

36%

Voters said they will blame Democrats in Congress “a lot” for a government shutdown

5% Government employees furloughed in the Department of Veteran Affairs

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