May 19, 2014 • An Advertising Supplement to the San ... · ceed.” Elizabeth Figueroa, Owner and...

May 19, 2014 • An Advertising Supplement to the San Fernando Valley Business Journal

Salute to Small Business

I t’s always a good time for small business own-ers to reassess their company’s financialhealth and their relationship with their bank.

The American Bankers Association offers the fol-lowing tips to help small business owners enhancetheir current banking relationship or choose thebest bank for their needs.

Many small business owners have been won-dering what it takes these days to get a bank loan.One way to influence your bank’s decision is toestablish a personal relationship with your bankerthat shows him or her just how valuable yourbusiness is.

Banks value long-term, profitable businessbanking relationships. Bankers reward these firmsby extending credit with the most favorable inter-est rates. These businesses and their bankersunderstand that developing a meaningful relation-ship is a two-way process—your banker has a roleto play and so do you.

So how do you know if you have a meaningfuland valued relationship with your bank? To findout, take the following “relationship test.”Respond to the seven statements below with“true” or “false.”

1) My firm has a bank relationship managerassigned to our account and we have contact (byphone or in person) at least once per quarter toupdate the bank on recent developments at ourfirm and within our industry.

2) Our bank relationship manager understandsour industry, our position in the industry, ourfirm’s value proposition, where we are today andwhere we’d like to be in the future.

3) We provide our banker with updated finan-cial information (historical and projected balancesheet, income statement, cash flow information toinclude projection assumptions and commentaryon actual performance) regarding our progresstoward achieving our goals on a timely basis.

4) Our senior management team meets annual-ly with our relationship manager and his/her bossto discuss our firm’s financial performance andchallenges and to understand the bank’s percep-tion of our performance.

5) Our relationship manager proactively brings

us ideas to help us achieve our goals.6) We understand how the current economic

crisis has affected our bank and our relationshipwith the bank (i.e., the availability of credit to ourfirm and the safety of our deposits).

7) Our firm makes sure that our banker is awareof all of our business with the bank (e.g., bothbusiness and personal) and that it makes moneyon our total banking relationship. In addition, ourfirm provides our banker with referrals to otherprofitable businesses.

If you were able to respond “true” to all sevenof these statements, you have positioned yourfirm well with your banker.

If you answered “true” to five or six, you stillhave room for improvement in developing ameaningful dialogue with your banker and bene-fiting from his or her advice and counsel.

If you answered “true” to four or fewer, youhave not positioned your firm well with your

banker and are putting your firm at a competitivedisadvantage in terms of: receiving the funds youneed to grow and prosper; obtaining the best ratesavailable for the financial products and servicesyour business needs to operate; and receiving“ideas and advice” to help you achieve yourdesired business goals.

Your firm should seek a bank that rewards arelationship approach to doing business withthem, and a banker who is able to give your firmthe financial advice that it needs to survive andthrive in today’s ever changing economy. Inreturn, your firm should reward this bank withyour business and loyalty.

The American Bankers Association represents banks ofall sizes and charters and is the voice for the nation’s$14 trillion banking industry and its two millionemployees. Learn more at aba.com.

How Small Business Owners CanAssess Their Banking Relationships

Many small business owners have been wondering what it takes thesedays to get a bank loan. One way to influence your bank’s decision is toestablish a personal relationship with your banker that shows him orher just how valuable your business is.

SPONSORED BY:

44 52_salute_to_small_biz.qxp 5/14/2014 7:54 PM Page 44

MAY 19, 2014 AN ADVERTISING SUPPLEMENT TO THE SAN FERNANDO VALLEY BUSINESS JOURNAL 45

As one of the nation’s largest insurers of small businesses, Travelers advocates foreconomic opportunity – one business and one community at a time. In addition todeveloping customized initiatives to protect small businesses, we are committedto working toward public policy solutions for small business owners and helpingthem prepare for the unknown through education and leveraging our expertisein risk mitigation. Travelers has undertaken these efforts because the companyunderstands that the health of small business is key to economic prosperity,competitiveness and the preservation of the American Opportunity.

travelers.com

© 2013 The Travelers Indemnity Company. All rights reserved. Travelers and the Travelers Umbrella logo are registered trademarks of The Travelers Indemnity Company in the U.S. and other countries.M-17011-2 New 6-13

It’s more than a business. It’s your livelihood.


46 AN ADVERTISING SUPPLEMENT TO THE SAN FERNANDO VALLEY BUSINESS JOURNAL MAY 19, 2014

Planning for Prosperity: A Look Back at the FirstTwo Years of the Small Business Risk Education Program

SALUTE TO SMALL BUSINESS

When Travelers and VEDC beganteaming up in 2011 to planthe initial stages of a program

that would help small businesses in LosAngeles/San Fernando Valley, they hadno idea what to expect. What theyshared, however, was an aspiration toengage entrepreneurs, who are vital tothe area’s economy and community, andhelp them succeed.

Travelers’ and VEDC’s partnershipeventually led to the formation ofTravelers Small Business Risk Education,better known as SBRE, as a way to helpbusiness owners better manage their risk.

Travelers SBRE offers insurance literacyand safety risk management education tominority- and women-owned small busi-nesses in a three-part program. It beginswith a workshop that covers the basics ofsafety risk management then transitionsinto one-on-one consultations withVEDC representatives and Travelers riskcontrol professionals who offer personal-ized guidance on business and safety riskmanagement. The third and final step isthe opportunity to apply for a microloan– managed and sponsored by VEDC– tohelp implement the safety risk manage-ment plan and, ultimately, grow the busi-ness.

More than two years after the firstworkshop in Los Angeles, nearly 100local small business participants havetaken advantage of SBRE and nearly$300,000 in microloans has been distrib-uted to business owners who have com-pleted the program. SBRE attendees,Travelers and VEDC have regrouped andare ready to share their experiences.Below, they discuss lessons learned andtheir hopes for the program as it entersits third year.

Tara N. Spain, Director of Operations, Com-

munity Relations, Travelers

“Travelers launched SBRE, a first-of-its-kind education program, to leverage ourcompetencies as a leading property andcasualty insurance company. As one ofthe nation’s largest insurers of small busi-nesses, Travelers understands that smallbusinesses create jobs, boost the econo-my and help to preserve the Americandream. We know that preparing smallbusinesses by helping them identify andmitigate their risks can energize the com-munity and its economy. We’ve been sothrilled with the first two years of theprogram that we expanded SBRE toChicago in 2013 and will launch addi-tional sites in New York City and Atlantathis year. We remain committed towatching these entrepreneurs embark ontheir futures and helping to secure thevitality of the communities in which wedo business.”

Marsel Watts, Program Director, Women’s

Business Center, VEDC, SBRE Program

Director

“Travelers set up SBRE in order to helpsmall businesses understand their risksfor today and tomorrow. SBRE caters tosmaller businesses that tend to not pro-tect themselves sufficiently, buy sufficientinsurance or mitigate potential risks totheir business. When it was launched in2012, the SBRE program had an immedi-ate impact on many of the businesses

VEDC serves. After participating in thetraining and one-on-one consulting, thebusiness owners implemented some ofthe knowledge they learned and are bet-ter off for it. We look forward to our con-tinued partnership with Travelers to helpsmall businesses in our community suc-ceed.”

Elizabeth Figueroa, Owner and Founder, Eliz-

abeth J Figueroa LLC, SBRE ‘12

“I was born with a needle and thread.In 2009, I decided to brand my ownname into the textile world. We hadsome challenges when we first opened.We don’t have a crystal ball, but we dohave self-confidence, and knowing andbelieving in our own product. In 2012, Idiscovered the Travelers SBRE programthrough my relationship with VEDC. Theprogram helped me to identify my risksand taught me how to properly plan in

the case of a disaster. Since the program,we’ve implemented lots of safety nets tohelp prevent loss from the unexpected. Iam greatly appreciative of the help andeducation that I received in SBRE. It is agreat umbrella to have for whenever youmay experience one of those ‘just in case’moments.”

Larry Gill, Supplier Diversity Manager,

Travelers

“As the dedicated supplier diversityprogram manager responsible for the sup-plier diversity strategy at Travelers, I cantruly say that the SBRE program’s energyparallels and echoes our long-standingsupplier diversity initiative. SBRE, like oursupplier diversity program, reflectsTravelers’ ongoing company-wide com-mitment to small business. Throughclearly established goals and objectivesthat drive program results, both programs

provide continuous opportunities thatdevelop diverse businesses. Events, train-ing and mentorship opportunities arehelping these small businesses succeed.

“The SBRE program is an ideal way tocomplement our diversity supplier effortsand we are proud to partner with ourregional partner, VEDC. As the programembarks on our third year, we at Travelersremain as motivated as ever to help local,diverse businesses learn how to addresstheir challenges while they attempt togrow their business.”

Benjamen Janey, Owner and Founder, HDLV

Apparel Group, Inc., SBRE ‘12

“I own a creative fashion firm in SantaMonica called HDLV Apparel Group, Inc.,and we specialize in creative fashionbranding for celebrities, entertainers,business-to-business and stylish individu-als all around the world. Travelers andSBRE helped me create a safety risk man-agement plan; it really made me thinkcritically about how to reduce the risks Iencounter every day.

“I think it’s important to start yourrisk planning right away when you startup your business. Even before you set upyour legal filings for your corporation, sitdown with a professional with your busi-ness plan and find out where the risksare. This way, you proactively plan forsome of the exposures that can be detri-mental to your growth.”

Merrie Dudley, Owner and Founder, Your Big

Day Bridal, SBRE ‘13

“I dreamed of entering the weddingbusiness as a young girl designing dresses& after working at bridal boutiques inmetro Detroit. Even after starting othercareers, the thought of opening my ownbridal salon was always in the back of mymind.

Then, after 25 years in the corporateworld, I finally decided to take theplunge and open your big day bridalsalon. SBRE brought to my attention thechallenges associated with running abusiness. The program helped me pre-emptively plan for the risks facing mybusiness and me. It was truly an educa-tional experience.”

Carl Roberg, Senior Risk Control Consultant,

Travelers, Glendale

“When I was first approached aboutparticipating in SBRE, I wasn’t sure whatto expect for a variety of reasons.However, as I meet the participants at ourworkshops and during one-on-one con-sultations, I can’t help but catch the con-tagious enthusiasm, imagination and cre-ativity involved in the program’s partici-pants who are living their dream eachand every day.

“These entrepreneurs are mostly in theearly stages of turning that dream intoreality. When we meet with them webring a broad spectrum of experience,having conducted thousands of riskassessments for all types of businesses –be it your local mom-and-pop generalstore or your larger multi-million dollarcorporation. We’ve seen the exposuresand we’ve seen the losses. We use this tohelp SBRE participants understand wheretheir exposures lie.

“At the core, it’s fun to be a part of

To celebrate the successof SBRE’s first year,Travelers and VEDC host-ed a celebratory event inLos Angeles that recog-nized the 61 programparticipants who suc-cessfully completed theprogram – 77 percent ofwhom were women. Thegathering featuredactress Vivica A. Fox, left,a strong advocate forwomen and minorityentrepreneurs. Picturedwith Arturo Pedroza ofTravelers, Fox shared herown journey throughentrepreneurship as aminority female andspoke about the impor-tance of coaching andmentoring women busi-ness owners.

(L-R) Marsel Watts, Director at VEDC, Tara N. Spain, Community Relationsand Tiffany of VEDC visit Dudley’s bridal shop, Your Big Day Bridal, inMarch, 2014.



Travelers launched the SmallBusiness Risk Education (SBRE)program in 2012 to fill an

important knowledge gap in the smallbusiness community – to help smallbusinesses plan for and manage theirrisks. The SBRE program, comprised ofsafety professionals with subject-mat-ter expertise, is a unique program thatincludes hands-on, one-on-one, con-sultations and access to tools that canhelp small businesses understand andmanage their risks, succeed.

A critical component of the SBREprogram is its partnerships with com-munity-based organizations that pro-vide small businesses with trainingand financial assistance. In the LosAngeles and San Fernando Valley area,Travelers joined forces with VEDC,the largest non-profit small businesslender in California, to leverage theirunique expertise in helping womenand minority-owned small businesses.Travelers has granted VEDC withnearly a half-million dollars overthree years to coordinate the work-shops and to fully administer themicroloans granted to some businessowners for capital investments. All ofthe program workshops and trainingsare conducted at VEDC’s office.

VEDC is a leading non-profit smallbusiness lender that is changing theway small business lending gets doneby making it more available, sustain-able and impactful. As a certifiedCommunity Development FinancialInstitution (CDFI), VEDC’s mission isto help create jobs and promote eco-nomic development in under-servedcommunities. They provide loans andmicro-financing options to small busi-nesses, particularly those owned bywomen and minorities, that don’tquality for traditional bank financing.

VEDC has supported small busi-ness owners for 37 years with the

goal of creating and sustaining jobsand businesses in underserved com-munities by providing high-qualitybusiness development services.Founded in 1976, the mission ofVEDC has expanded to respond tothe financial assistance and develop-ment needs of entrepreneurs in lowto moderate-income communities.

VEDC believes that the major barri-er for today’s small business is access tocapital. Without adequate financing,many small businesses are preventedfrom thriving. That is why VEDCfocuses its efforts on lending and guid-ing small businesses to achieve busi-ness growth and sustainability. Theirinterest is to get loan funds in thehands of minority and low-incomeborrowers so that businesses can becreated, maintained, and expanded.

In fact, VEDC has been instrumentalin helping to create economic opportuni-ties in low-income, underserved areas forthose who want to improve their finan-cial standards and build stronger com-munities. The organization has helpedcreate and retain over 25,000 jobs andopen more than 1,700 new businesses.Historically, 75 percent of VEDC clientsare located in low- to moderate-incomeareas and 65 percent have been minorityand women entrepreneurs.

It has been proven that a combina-tion of technical assistance, access tocapital and partnerships with localworkforce and business assistanceagencies are critical to entrepreneurialsuccess. The success of small business-es and the creation of jobs is the keyingredient in developing healthy andsustainable communities.

VEDC operates a Small BusinessAdministration (SBA) Women’sBusiness Center, San Fernando ValleyFinancial Development Corporation,Pacoima Development Federal CreditUnion, and two Los Angeles BusinessSource Centers. The combination ofthese successful programs that antici-pate the needs of growing businesses inthe ever-changing economy has createda focused vision of economic opportu-nity, effective organization of resources,and the fostering of job creation.

Each year, VEDC serves more than5,000 small businesses with financing,training, and direct business assistance.As a result, VEDC has been instrumen-tal in helping to create economicopportunities areas for those who wantto improve their financial standardsand build stronger communities.

Roberto Barragan is President and CEO ofLos Angeles-based Valley EconomicDevelopment Center, the largest microfi-nancing organization in California.

Teaming Up to SupportSmall Businesses: An In-Depth Look at VEDC


SBRE and the full process. Starting a busi-ness can be a scary proposition but we tryto help the business owner so he/she caninstead focus on the passions that fueltheir dreams.”

Melissa Adele Rosen, Owner, Locali Con-

scious Convenience, SBRE ‘12

“For me, the SBRE program was quitethe experience. I was a participant in2012 and I’ve seen my business growexponentially since then. Shortly afterparticipating in the program, I found anincredible new location for our quickservice restaurant brand, LocaliConscious Convenience, which alreadyhad one store in Hollywood and one inthe form of a sister vegan bodega conceptin DTLA, known as Localita & TheBadasserie. The third location is inVenice, not far from the beach, and it’stwice the size of our first store. Travelersand VEDC helped me obtain the trainingand financing we needed to expand.

“I want to thank Travelers and VEDCfor the ability to join and complete theSBRE program. The support I receivedthere greatly inspired me to continuegrowing my business in Los Angeles andenlivened my passion for creating farrierand long-term employment opportunitiesin this city.”

Arturo “Art” Pedroza, Senior Risk Control

Consultant, Travelers, Irvine

“When I first heard about the SBREprogram, it struck a personal chord; Igrew up in a household headed by immi-grants and worked with my father as hegrew his janitorial business. I know first-hand how much pride folks can take incrafting their own enterprises, particular-ly if they come from meager means.

“I have since been involved withmany SBRE sessions and have had thehonor of working with the participantsin one-on-one sessions. These meetingshelp the participants refine their riskmanagement plans by discussing theirmain points of concern. In some cases,that means talking about vendors’ cover-age and business continuity for thosedoing business with foreign entities. Inother cases, the conversation has focusedon employee injury prevention and

workers’ compensation insurance. “Each SBRE session is unique; you

never know what sort of dreams the par-ticipants will bring to the meeting.Through SBRE, I have met so many tal-ented individuals with fantastic ideas andoften stirring personal histories. I recallone woman whom I spoke with survivedbreast cancer and then switched hercareer from healthcare to makeup and isnow opening a makeup school whilesimultaneously running a photographybusiness. It has been quite enriching tomeet such unique individuals and workwith them to try and manage the pitfallsthat could otherwise bring down theirbusinesses.

“If I have learned anything in this pro-gram, it is that what we do in risk controlis a component that even the smallest ofbusinesses can’t neglect. It impacts bothexisting operations and the well-being ofthe dreamers who are just starting out ontheir respective pathways to success.”

Jacqueline Sharp, Owner and Founder, Fort,

SBRE ’12

“I was fortunate enough to be a mem-ber of the inaugural program of SBRE.The program taught me about risks I hadnever even considered. Since I launchedmy Los Angeles-based furniture businessin 2011, my company has been wellreceived. We have been recognized invarious ways and, frankly, I owe a lot ofmy preparation and peace of mind to theTravelers SBRE program.

“Through training with a Travelerssafety professional, I developed a clearsense of potential issues that couldimpact my ability to staff, grow and man-age my company. I now have a risk man-agement plan to prepare for unexpectedinterruptions and can focus my time onbuilding my business. Two years later, Iam still thriving and word about mybusiness is picking up. With the help ofTravelers, I have become much more con-fident in my business. I have managed toturn my hobby of making and refurbish-ing old furniture into a full-blown busi-ness. It just goes to show that a littleimagination, hard work and preparationcan go a long way.”

Local small business owners attend a recent SBRE workshop.

VEDC believes that the

major barrier for today’s

small business is access to

capital. Without adequate

financing, many small

businesses are prevented

from thriving. That is why

VEDC focuses its efforts on

lending and guiding small

businesses to achieve

business growth

and sustainability.

44 52_salute_to_small_biz.qxp 5/14/2014 7:54 PM 7

Business Owners, Entrepreneursand Small Business Service Pro-viders are growing their sales with

social media. Key benefits of social mediainclude attracting and engaging withmore customers on Facebook, Twitter,LinkedIn, Google+, YouTube, oGoing,blogs and more.

“Social Media provides businesses anunprecedented direct communicationwith customers! Using social media, abusiness directly informs their clientsabout what’s going on, promotes newoffers and services, and provides cus-tomer service; the clients freely expresswith the company their experiences, ask

questions and provide direct feedback ina public setting. This level of intimacyand engagement hasn’t been achievedbefore,” said Sanjay Dalal, founder &CEO, oGoing.

oGoing is the nation’s fastest growingsmall business social media marketing net-work. Thousands of Business Owners,Entrepreneurs and Small Business ServiceProviders are using oGoing to generatewarm leads, attract new customers, pro-mote products and services, share deals,and engage with clients directly.

oGoing presents 5 social media tips andbest practices for a business to attract morecustomers using social media marketing:

1. Know the customers

Take time to know your customersthrough social networks. Stand in theirshoes. Learn more about their business. Askthe question: “What are their needs?” Findthem, and Search their social mediaupdates. Learn more about the customer’scustomers. The more knowledgeable onebecomes about the customer’s business, themore products and services the businesscan ultimately offer to them.

2. Connect with customers

After determining who the customersare, a business must take the logical nextstep: Connect or Follow them! Once con-

nected, most social media networks share alive news feed of the following user’s up-dates. Thus, when a business is logged in,they see latest news stories about their cus-tomers. Reading what’s going on providesgreater understanding of the customers’ cur-rent situation, needs and events.

3. Engage with customers

Reading the customers’ updates andgaining further knowledge about themare important first steps. Next step is tobegin engaging with the customers. Thebest way: Reply to their updates and Askquestions. When a business responds towhat their customers are saying, and be-gins a conversation, that’s when engage-ment begins. Social media is all about“live” conversations. Besides replyingpublicly, a business can also ask directquestions to solicit a response, reply pri-vately or send a direct message for furtherintimacy.

4. Promote customers

Often times, owners and marketers for-get that social media marketing is not somuch about promoting their own business;rather, it’s more about promoting their cus-tomers. This simple fact changes how well

engaged the customers are. When the com-pany takes on the onus of promoting theircustomers, the returns are tangible andimmediate. What customer doesn’t like apublic promotion in the form of a men-tion, sharing of their updates, or recom-mendation?

5. Ask for referrals from customers

After establishing a solid relationshipwith customers and prospects on socialmedia, a business can begin to transformthis engagement into leads. Social mediacannot be an off and on affair. It has bean always on campaign. Hence, a businessmust frequently login to social media net-works and engage with their clients on adaily basis. When the time’s right, ask thecustomers for new referrals and sharewith them new offers.

oGoing provides a powerful socialmedia marketing network for small busi-ness that increases website traffic, im-proves SEO ranking, generates warmleads and attracts new customers.

Five Small Business Social Media Tips to Attract Customers




By TAMARA GURNEY

Community banks, so aptly named,help build more economically sus-tainable communities, putting

local deposits back to work in their com-munities through loans to local residentsand small businesses, which helps localeconomies thrive.

“Community banks serve a vital role inmaintaining the lending flow to fellowsmall businesses in their neighborhoods.Often when other banks won’t lend, it’sthe community banks that step up andhelp Main Street succeed,” saidInternational Community BankingAssociation Chairman John H.Buhrmaster. “Community banks are smallbusinesses too, which puts them at a hugeadvantage because they can relate withthe challenges and needs small businessesface better than anyone else in the market-place—helping their small business cus-tomers through good times and bad.”

Given that community banks in and ofthemselves are small businesses, lending bylocal banks is truly small business to smallbusiness. Community-based business banksare known to sit down with a businessowner to discuss their needs, experienceand business plan, and then advise themon the best approach and type of loan.

Community banks are the primarysource of lending for most small businesses.For their size, community banks are prolificlenders, providing a substantial number ofsmall business loans across the country,including SBA loans. In fact, even though

they comprise just 20 percent of bankingindustry assets, community banks with lessthan $10 billion in assets make nearly 60percent of loans to small businesses.

What sets community banks apart is theirability to customize loans and packages foreach and every business. As the saying goes,there is no “one-size-fits-all” approach torunning a business, and the same goes forbusiness banking. Community banks offer

unparalleled financial experience, resources,and reliable personal service, truly tailored tosmall business success.

The first question small business ownersmay want to ask their lender is whether anSBA loan is a viable option. The U.S. SmallBusiness Administration (SBA) is an inde-pendent agency of the federal governmentthat aids, assists and protects the interestsof small business concerns, preserves freecompetitive enterprise and strengthens theoverall national economy.

The SBA does not make loans directly tosmall businesses. Rather, the SBA sets theguidelines for these loans, which are thenmade by the SBA’s lending partners. Whena business applies for an SBA loan, it isactually applying for a commercial loanthat is structured according to SBA require-ments with an SBA guaranty to the actuallender. The SBA helps Americans start,build and grow businesses through anextensive network of field offices and part-nerships with public and private organiza-tions, including community banks.

Qualifying for an SBA loan may be easi-er than qualifying for other, more tradi-tional forms of financing, as the SBA pro-grams generally allow for a higher loan tovalue ratio, longer amortization periodsand may even consider the projectedincome of the business (not just historicalcash flows) when making a credit decision.These factors can be extremely helpful,particularly to a rapidly growing company.

SBA loans help small businesses growand, overall, community banks lendingto small businesses drives job creation inthe San Fernando and Santa ClaritaValleys, building more sustainable com-munities. Job creation not only bolstersthe local economy, but contributes to ahigher quality of life for everyone.

Community banking is based on rela-tionships, not just transactions. Goodcommunity bankers work tirelessly todevelop a deep understanding of theirclient businesses – how they operate, thelandscape of their individual industry,their challenges, as well as their goals –

not just how they’re financed and funded.As members of the very community theyserve, the success of local banks coincideswith the success of the community.

On a national level, community banksnationwide are an integral part of thiscountry’s financial system. There arealmost 7,000 community banks, includ-ing commercial banks, thrifts, and stockand mutual savings institutions, withmore than 50,000 locations throughoutthe United States. Assets may range fromless than $10 million to $10 billion ormore. Community banks constitute anastounding 96.8 percent of all banks.

Community banks will continue tocontribute to the success of small busi-nesses and serve their communities wellinto the future; making communities abetter place for all residents.

To join the conversation on communi-ty banking, follow #BankLocally onTwitter. To learn more about communitybanks, visit www.icba.org or www.cib.org,or visit MissionValleyBank.com.

Mission Valley Bank is a locally-owned, fullservice community business bank headquar-tered in Sun Valley, California with branchoffices in Valencia and Santa Clarita.Tamara Gurney is President and CEO ofMission Valley Bank, and was named “MostTrusted Advisor — Business Banking” and“Trailblazer” by the San Fernando ValleyBusiness Journal. She is also president of theCalifornia Independent Bankers and can bereached at (818) 394-2300. For more infor-mation visit www.MissionValleyBank.com.

Local Banks Support Small Businesses


COMMERCIAL BANKING. INTERNATIONAL BANKING. PRIVATE BANKING. leumiusa.com

Dear LA,We’ve been togetherfor almost 40 years.Don’t you think it’s timeto take our relationshipto the next level?

At Bank Leumi USA, we believe better relationship banking means enhanced space

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customers for nearly 70 years. Our comprehensive suite of productsand team of business banking experts make us a top referred bank ofattorneys and financial professionals.

With more than $3.4 billion in assets Community Bank has the resourcesto help your clients while still providing the service of a premiercommunity bank. Let us help both you and your client grow theirbusinesses today and for many years to come.

A Partnership for Your Client’s Banking Needs

cbank.com877.922.2653

SBA Preferred Lender | Member FDIC | Equal Housing Lender


‘Community banks serve a vital

role in maintaining the lending

flow to fellow small businesses in

their neighborhoods. Often when

other banks won’t lend, it’s the

community banks that step up

and help Main Street succeed.’

JOHN H. BUHRMASTER, International

Community Banking Association Chairman




Follow us: @SFVBJ

In print.Online.

On the go.Subscribers can now see the entire print edition of the

San Fernando Valley Business Journal on any tablet or computer. In addition, sfvbj.com is regularly updated with the latest in San Fernando

Valley’s business news. Sign up to get free daily email newsletters.www.sfvbj.com

Unique Program “Works” for Small Businesses UPS Offers Ten Tips forSmall Business Success

It’s hard to believe now, but UPS started out

as a small business more than a century ago.

Today, as the world’s largest package delivery

company, the shipping organization under-

stand how important it is to win contracts with

companies, and knows that the bottom line

counts. Here are 10 tips offered up by UPS for

small businesses to consider for success:

1. Get certified as a minority- or woman-owned

business and get involved in local organizations.

2. Look for customers who are committed to

supplier diversity.

3. Know how to sell your company by pitch-

ing what you alone can bring to the table.

4. Conduct advance planning and research

about the company.

5. Understand what makes the company tick.

6. If your product or service is not a good fit

for a company, know when to cut your losses

and focus energy elsewhere.

7. Pick the right point-of-entry by contacting

the appropriate buyer.

8. Be able to answer this question: “If I buy

your product or service, how will it help my

company gain a competitive advantage?”

9. Seek mentor relationships to bolster weak

areas.

10. Practice the three P’s: patience, persist-

ence, and perseverance.

By MARLA CLEMOW

There’s no denying that smallbusinesses are the lifeblood ofour economy – both on the

local and national level. According tothe U.S. Small BusinessAdministration’s Office of Advocacy,America’s 28 million small businessesaccount for 99 percent of employerfirms in the U.S. and 64 percent of thenet new private-sector jobs in theeconomy.

While each business has uniqueneeds, we know that small businessowners share a very common set ofconcerns. From managing expensesand cash flow, to hiring the rightemployees and determining how andwhen to expand, all business ownersneed advice and input to keep theirbusinesses thriving.

At Wells Fargo, we have the oppor-tunity to learn first-hand about thechallenges and questions businessowners encounter. We serve one in 10small businesses in America, so we talkwith small business owners every day,and as a company we recognized a realneed to do more to help these busi-nesses in our communities.

That’s why we launched WellsFargo Works for Small BusinessSM as astarting point to connect small busi-ness owners with a variety ofresources, information and knowledgeto help them take the next step

toward their goals. We organized thisinitiative around the four areas thatbusiness owners told us are their prior-ities: growth, knowledge, capital andcommunity.

The centerpiece to launch this ini-tiative is the newWellsFargoWorks.com – an enhancedonline resource that offers useful busi-ness and financial guidance to helpbusiness owners build their knowl-edge. It features hundreds of storiesand informational resources, as well asvideos, with national small businessstrategy experts and business ownerssharing their experiences.WellsFargoWorks.com encompasses allthe education, services and support weprovide our small business customers.

Wells Fargo also works with severalnational business and communityorganizations to help provide financialeducation and resources focused onserving the needs of small businessesin diverse communities acrossAmerica. Along with the U.S. HispanicChamber of Commerce, the NationalAssociation of Women BusinessOwners, the National Urban League,U.S. Black Chambers, Inc., the U.S.Pan Asian American Chamber ofCommerce, the National Gay andLesbian Chamber of Commerce andother trade associations, we’re provid-ing a depth and breadth of opinionsand experiences to help further theunderstanding of entrepreneurs in all

walks of life. Knowledge and understanding are

keys for success in business, as well asa supportive relationship with a localbanker, one who will work to earn abusiness owner’s trust, help overcomechallenges, and meet the owner’ finan-cial needs. From time to time, businessowners also need access to capital. Aspart of the Wells Fargo Works for SmallBusiness initiative, Wells Fargo hasannounced a goal of extending $100billion in new lending to small busi-nesses by 2018. We want to help asmany businesses as possible to succeedfinancially and to provide the financ-ing that makes it possible. While we’reproud of our work with small businessowners, we hope this new initiativedoes more than simply increase ouropportunities to serve these businesses.We want to create more focus andattention on the importance of smallbusinesses in America and on the sup-port these businesses need. As thathappens, we can strengthen the smallbusinesses so vital to our economy, aswell as our communities.

Marla Clemow is the Wells Fargo com-munity bank regional president for L.A.Metro. For more information on WellsFargo Works for Small Business – and tolearn more about how you could win$25,000 for your business – visit wellsfar-goworks.com/project.



1 Transactions refers to any combination of deposits, paid items and deposited items, including paper and electronic. Transactions do not include purchases and payments made using a Wells Fargo Business Debit Card, Wells Fargo ATM Card, Business Bill Pay or Direct Pay payments made through Wells Fargo Business Online®, and Wells Fargo Merchant Services or Wells Fargo Business Payroll Services transactions.

2 Wells Fargo ATM access fee waived for two domestic (U.S.) non-Wells Fargo ATM cash withdrawals from your Platinum Package checking account per statement cycle. ATM access fee for each additional non-Wells Fargo ATM cash withdrawal transaction will be assessed. Surcharges imposed by non-Wells Fargo ATM owners or operators will apply.

© 2014 Wells Fargo Bank, N.A. All rights reserved. Member FDIC. SBS60-00178 (1194601_12061)

Premium benefits and customized options for your business

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Discover the many benefits of a Platinum Business Services Package: �• Includes at no charge first 500 transactions and first $20,000 in cash deposited monthly1

�• Interest on checking balances of $25,000 or more �• No fee for two incoming domestic wires per statement cycle, no fee for stop payments,

cashier’s checks and money orders, and waived ATM access for two non-Wells Fargo domestic ATM cash withdrawals2

Talk to us about the Platinum Business Services Package or the Wells Fargo Gold® Business Services Package by calling 1-800-359-3557, or contact your local banker today:

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Wells Fargo Platinum Business Services Package checking account:Expanded capabilities for larger or growing businesses.



By MADELEINE JUAREZ

The value of any asset is whatsomeone is willing to pay for it.Usually valuation is presented as

an objective analytical process to measurevalue. While financial analysis is impor-tant, decisions, even financial ones, areprimarily emotional. Analysis and logicserve to justify emotional decisions.

Many of us experience this when pur-chasing a home. We must justify payingmore for a home because we want a par-ticular design, location or quality ofworkmanship. We may pay a higher priceeven though a more analytical measure,such as cost per square foot, may indicatethat we are paying too much.

Likewise, when business owners areasked what they are willing to sell theircompany for versus the price they wouldpay for their company, the answers arevery different. Would you like to guesswhich number is higher?

So what can you do as a businessowner to generate excitement and maxi-mize the valuation of your company inthe private market?

Private Market Players

The private market is composed ofthree major groups: financial investors,buy-out groups and strategic investors.

A financial investor prefers to investwith the existing management team. Theinvestor may be a private individual (an“angel”) or may be an institutional ven-ture capital fund. These investors do notwant to manage or control the compa-

ny’s operations.Buy-out groups, however, do want

operating control and often will replaceexisting management.

A strategic buyer invests because ofperceived “synergies” or overlaps betweencompanies. A franchisee acquiring anoth-er franchisee would be an example of astrategic purchase.

Valuation Yardstick

In the private market, your company’sEBITDA (earnings before interest, taxes,depreciation and amortization), is a com-mon yardstick for establishing a value.Your company’s value will be a multipleof EBITDA.

Private market multiples are seen inthe following ranges:

• “Typical” non-franchising company: 6-9X• Pure Franchisor (no company stores): 3-5X• Franchisor with at least 30% of storescorporate: 5-8X• Franchisee: 2-4X

As you can see, the private investormarket is not as comfortable with a purefranchisor. One concern is that a purefranchisor will have greater difficultyreaching the size and growth plateausrequired to generate an appropriate returnfor the investor. It is feared that a fran-chisor will have difficulty maintaining asecure cash flow because franchisees willuse at the least provocation and stop pay-ing royalties. Another concern is that apure franchisor does not have an operat-ing infrastructure to be an effective “mar-

ketmaker” in their system to buy and sellexisting franchisee operations and main-tain ongoing concern values. A maturepure franchisor exhibits more characteris-tics of a financial management than aretail operating company. As a result,franchisors with a significant percentage ofcorporate stores trade at higher multiples.

If you are a franchisee, the value ofyour company is discounted by aninvestor’s perception of your ability tocontrol your own destiny. To an extent,your future is dependent on the fran-chisor. Also, your growth may be limitedby the territory the franchisor is willingto grant you.

Beyond the EBITDA valuation

Investors miss many good opportuni-ties because small-business owners fail toeducate them about their business interms the investor can understand, bothintellectually and emotionally. If you canovercome some investor concerns, youmay obtain higher valuations.

This is done by pushing beyond thestandard EBITDA-type analysis. Companiesare positioned along the following:

1) Concept 2) Management 3) Unit Economics 4) Systems 5) Historical Performance

First, your concept is the value-addedservice you bring to your customers.Hopefully, this success formula can bearticulated in 10 words or less, like

Boston Market’s “Quality of eating athome with a convenience of eating out”or Arrow Prescription Center’s “cost-effec-tive delivery of pharmaceutical services.”Investors like concepts they can under-stand. Make it simple and intuitive.

Second, you need to demonstrate whyyour management team is up to the taskof fulfilling your plan. This is not thetime for rambling resumes. Make the keymanagement team come alive and drivehome that they have succeeded, an willcontinue to succeed in replicating yoursuccess formula and building futurevalue.

Compelling unit economics for fran-chised concepts can translate into 25 per-cent or higher return on capital. Youneed to get beyond EBITDA margins atthe unit level and analyze volume, cashflow and investment.

Systems are necessary because “retail isdetail.” Appropriate and timely customerand cost data is one of the cornerstonesfor growing your business.

Finally, you want to show how yourhistorical performance validates your suc-cess formula. Your approach to your busi-ness should give confidence that you canachieve your business plan.

This may sound simple until you tryto do it, especially before an unfamiliaraudience or on the telephone.Remember, the key is to generate excite-ment and to push an investor’s emotion-al “hot button.”

Madeleine Juarez is a freelance writer andbusiness investment consultant.

Drawing Investors as a Small Business Owner


SAN FERNANDO VALLEY BUSINESS JOURNAL I N P R I N T I N P E R S O N O N L I N E

Real Estate QuarterlyEach issue of the San Fernando Valley Business Journal is read closely by theSan Fernando Valley’s community leaders and real estate industry executives.They count on the publication for its regular coverage of the marketplace, andthey look forward to the more in-depth coverage our Real Estate QuarterlySpecial Reports offer. Each quarterly report details indispensable data, includingmarket conditions by geographic area, and major transactions and ground-breaking new deals that shape the region’s future.

Considered the ideal place for making announcements, establishing a brand,creating synergy between partners or fulfilling marketing obligations of a majorclient, Real Estate Quarterly Special Reports are key to the marketing schedulesof the leading real estate companies in the San Fernando Valley.

For more information, contactKollene McGinleyat 323.549.5225 ext. [email protected]

Publication Date: July 21, 2014


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