Want to be an entrepreneur?
Here are two places that could help
Dr. Albert Ruesga, president and CEO of The Greater New Orleans Foundation
New Orleanians, it seems, are just full of great ideas – maybe that comes with living in one of America’s most creative cities. Turning those ideas into thriving businesses, however, can take some help. Fortunately, two local nonprofit organizations specialize in showing entrepreneurs how to grow their seedling enterprises into profitable companies that employ local workers, boost the city’s tax base and burnish New Orleans’ reputation as a place where hard work and creativity pay off.
The Greater New Orleans Foundation and The Idea Village share a common goal: helping the city’s economy by nurturing fledgling enterprises.
They go about their work in different ways; the GNOF supports nonprofits that in turn aid entrepreneurs, while The Idea Village offers entrepreneurs education and access to capital, among other services.
Dr. Albert Ruesga, president and CEO of The Greater New Orleans Foundation, says the city doesn’t lack entrepreneurs.
“Entrepreneurship has spiked in New Orleans post-Hurricane Katrina,” he says. “There is a lot of micro-enterprise activity.” The foundation aids New Orleans and the surrounding parishes, and has been up and running for almost 30 years. It receives funding from grants and from donors, and has a staff of about 10 people.
But a recent study released by the GNOF and the Ford Foundation points out some of the hurdles these entrepreneurs face. About 37 percent of New Orleans households suffer from asset poverty, meaning they don’t have much in the way of savings and other assets to fall back on if they encounter stormy financial weather. In addition, 71 percent of New Orleans consumers have subprime credit histories. The study also found too many residents live in persistent poverty, making it difficult for them to raise the money to get small businesses off the ground.
The foundation looks for nonprofits that have good track records in helping entrepreneurs grow, such as the Good Works Network in Central City, which aids minority- and women-owned businesses. The network has assisted more than 1,900 individuals, and helped 300 businesses start since it opened in 2001.
Another group the foundation supports is GNO Inc., an economic development organization. It also teams with nonprofits such as The Idea Village.
It takes a lot of grit to be an entrepreneur, Ruesga says. The odds of turning an idea into a profitable company are slim; entrepreneurs have to be willing to work hard and to accept risk. Successful entrepreneurs do their homework first, he says, and make a thorough study of the market they’re entering. He cites a client who wanted to start a small cleaning business. The company got off the ground, and now the foundation uses the business to do its cleaning.
Ruesga is bullish about the future of New Orleans and the surrounding parishes. The area’s recovery from Hurricane Katrina brought a lot of national publicity, and the city is becoming known as a good place to do business.
Tim Williamson is also bullish about New Orleans. Williamson, a co-founder and CEO of The Idea Village, thinks the area’s economy will grow through the addition of new small businesses, rather than through one or two giant industries opening plants or stores in New Orleans. Our city is suited to the small business market, he says; it matches our propensity for boutique shops and neighborhood eateries.
For the past 12 years, The Idea Village has supported entrepreneurs through workshops, counseling and access to venture capitalists and bankers. The group has a full-time staff of nine and brings on consultants to help. Fledging companies can benefit from two-hour, one-on-one strategy sessions or a six-month education track, among other programs.
“To date, we have logged 55,000 consulting hours,” Williamson says. Last year, the group helped entrepreneurs access $375,000 in capital. The Idea Village, which assists businesses in a seven-parish area around New Orleans, takes no equity in the startups it works with. The group partners with many other organizations that support entrepreneurship.
The numbers The Idea Village has racked up are impressive: to date, 2,028 professionals have allocated 56,949 consulting hours and $3.1 million in seed capital. The organization hears pitches from companies with less than $1 million in sales and fewer than 10 employees.
Williamson and his coworkers look for certain characteristics in deciding which entrepreneurs to help:
• What is their idea?
• How will it make money?
• Who is on the team, and what are their backgrounds?
• What do they need to grow their business, besides money?
Good entrepreneurs are also passionate about their ideas, and they’re willing to accept advice. “Great entrepreneurs know what they don’t know,” he says.
And to succeed, they must be willing to put in time, lots of time, because growing a business is a tough journey. They must understand that the core mission of every successful business is to make a customer happy, Williamson says. It isn’t for the easily discouraged.
One of the many startups The Idea Village helped is Cordina, a company founded by three young men from Kenner who noticed how difficult it was for people to bring pitchers full of drinks to the beach. Their idea? The margarita in a pouch, called the Mar-GO-rita. The company did about $5 million in sales last year, Williamson says, and are projected to take in $25 million. In the process they’ve created jobs and attracted local and national venture capitalists.
Another success story is Fleurty Girl, founded by New Orleanian Lauren Thom in 2000 with $2,000 from her income tax refund. Fleurty Girl sells New Orleans-inspired T-shirts and accessories, and now does about $2 million in business, Williamson says.
Because the New Orleans area is surrounded by, and influenced by, so many bodies of water, The Idea Village and The Greater New Orleans Foundation have partnered to come up with The Water Challenge. Together, they’re challenging local thinkers to come up with ways the New Orleans region can live with the water that surrounds it. In 2012, the winner was Dr. Sarah Mack of Terra Resources, a company that researches the development and monetization of the blue carbon found in coastal wetland ecosystems. The winner of the challenge receives $50,000 in business development capital.
New Orleans has historically been an inventive city, Williamson points out. We have created our own music style, our own cuisine and even our own holiday – Mardi Gras. But too often people with good ideas either moved away or found their ideas co-opted by outside business people. The Idea Village aims to support these individuals to keep them, and their businesses, in New Orleans.
Buoyed by the inventive ideas he hears about every day, Williamson sees a long future for entrepreneurship in the region.
“I see the best of New Orleans, “ Williamson says. And The Idea Village and The Greater New Orleans Foundation will be there to help.