News From the Louisville SBDC

Keys to Scaling-up Louisville's Economy in 2017

A New Year requires a new perspective and a reality check for Louisville entrepreneurs, business owners, employees, lenders, mentors and policymakers. Startups are important to our region’s economy, but they will not be the main drivers of growth. The local and national numbers tell the tale.

The Census Bureau found there are 27.9 million small businesses (defined as independent businesses with fewer than 500 employees) operating in America. Eighty percent are “non-employers,” or as we refer to them nowadays, “solopreneurs.” The big opportunities for growth, as identified by the U.S. Small Business Association are the firms between $150,000 and $200,000 in revenue. When accounting for net employment change among businesses smaller than 500 persons, 60 percent of new jobs created are from expansions or scaling up.

Locally, Endeavor Louisville, a nonprofit that supports high-impact entrepreneurs, discovered that new company formation in Louisville is strong, but those companies are not growing or adding jobs fast enough. Per data compiled by Reference USA, almost 43 percent of businesses in Louisville have under $500,000 in annual sales, 21 percent have $500,000 to $1 million, and almost 19 percent have $1 million to $2.5 million. Those three brackets are where we need to focus efforts for the long-term betterment of the region.

David Oetken
Louisville SBDC Center

However, to succeed at pushing these companies, we must reprogram our views about entrepreneurship. Starting a business is only part of the equation. Helping a business grow is often more challenging.

Anecdotally, I meet many owners of smaller enterprises in all manner of industries who are not interested in growing. The challenges are substantial, and not everyone has an appetite for risk and long hours away from family, or other pursuits. I meet even more who have worked to expand their business, only to be forced to revert to old habits.

The scale-up is difficult to master, but crucial to our future success. Our goal in Louisville must be to create an entrepreneurial ecosystem that fosters the growth of existing companies.

Continuing, one-on-one support and technical assistance is irreplaceable in this process. Entrepreneurs looking to make the leap to higher growth must be self-critical in 2017.

Conducting proper business planning or a reexamination of an older plan is essential. Business owners benefit from having a formal, written plan. Prioritizing efforts as they relate to time and money, and setting clear, measurable goals makes this exercise worthwhile. After all, real business plans are crucial in securing Small Business Administration guaranteed loans and bank lending. Institutions will not approve lending without a well-written plan, and any significant growth will require additional capital.

Standardizing business processes are also an integral component of scaling up. Experiences can be consistently reproduced through standardization. An employee handbook, with well-constructed on boarding and training is a good place to start. In the early stages of a company, these structures seem unnecessary, but eventually they are necessary.

If Louisville commits to a scale-up and startup mindset, we will be a force to be reckoned with for years to come.

Your opinions matter to me, so don’t hesitate to reach out to the Louisville SBDC if you would like to share your thoughts regarding this article or simply want to start a meaningful conversation with one of us. We’re here to help. The main office number is (502) 625-0123.

Client Spotlights

Sharpenstein Health Coaching

Jessica Sharpenstein, owner of Sharpenstein Health Coaching, loves January because improving their health and setting goals is usually front and center in the minds of most of her clients during that month. Jessica recently described health coaching as “the GPS or map that gears us toward our health goals and wellness-vision destination”. She believes that being healthy and feeling great does not have to be a complicated, time consuming, or any part of a daunting process. Her main role as a health coach is to help clients understand that a healthy lifestyle is about learning a few basic strategies and that it is all about planning, feeling confident in your choices, caring for yourself, and dreaming of feeling the best you can. Start the New Year out right. Plan for success! Here’s a link to how to get started today: http://www.sharpensteinhealthcoaching.com

Sharpenstein Health Coaching

If part of your New Year’s resolutions involved getting organized, Aladdin Self Storage can help. As a recent recipient of a Best of Louisville award, owner and founder Hellen Helton said the award was “completely unexpected – but so reassuring that focusing on best of class customer service does count!”.

Multiple resources to help with planning for your storage needs can be found on the website, http://aladdinselfstorage.com, but the company doesn’t stop there. Most self-storage facilities are content to simply rent a storage unit and let the client’s deal with storing their often-valuable property in a very disorganized manner. To distinguish itself from other storage facilities, Aladdin offers boxes, tape, bubble wrap, mattress and furniture covers for sale. In addition, they can help design and build shelving solutions specifically to fit the customer’s needs. Finally, pushcarts are available for clients’ use to allow ease in moving items in an organized manner. No excuse for disorganization in 2017!

Louisville WOW Spa

Why not start the New Year with a perfectly smooth face! Louisville Wow offers custom services by a highly skilled and licensed esthetician. Located at 332 West Broadway, Suite 217F, The Louisville Wow Spa is the skin therapy destination.

Come by and say hello to Jenise Squires who will gladly give you a soothing facial, chemical peel, or enzyme peel. For those patrons looking for a fresh new face for 2017 please visit http://louisvillewowspa.com/services/ and make an appointment. New Paragraph