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Michael: Good evening, everyone. Come on in and please take a seat . We're going to get
started here in just a minute. I think we have a few folks still outside, so we'll wait
just another minute or so, and then we'll go ahead and get started with tonight's events.
All right, why don't we go ahead and get started? My name is Michael Chodos, I am the Associate
Administrator for Entrepreneurial Development at the SBA. I wanted to welcome everyone to
tonight's events and the kickoff of the Small Business Events [00:02:00] at Washington,
DC. During the course of the week, we have had a series of truly remarkable events across
the country. It has been an incredible opportunity to celebrate all of the things being done
by small business across the country to provide counselling, mentoring, matchmaking opportunities,
information about how to expand, and grow, and create jobs, and it's been just a remarkable
way to participate in all of the ways around the country that small businesses connect
with the Small Business Administration.
With that, I wanted to say welcome everyone this evening. It is an honor to be here and
to be helping along as we move things forward tonight.
I want to say, first of all, I urge you to spend the rest of the evening networking and
having a good time. To start off our evening, I'd like to welcome our sponsor of the evening,
Patrick Girard, Staples Regional Vice President for Sales and Operations. Please help me welcome
Patrick.
Patrick: Good evening. How are you all doing? Great, welcome. As Michael said, I 'm Pat
Girard, I 'm the Regional Vice President for Staples, and I 'm based out o f the DC market
here. I actually live about an hour south of here in Fredericksburg, Virginia. Is that
good ? A hand for Fredericksburg ? All right. I 'm actually from New England, though. No
booing. I 'm a Red Sox fan, a Patriots fan, a Bruins fan, a Celtics fan, and I 'm not
a Heat fan.
I've proudly worked for Staples for the last sixteen years. I want to thank you and welcome
you to the National Small Business Week. The list of businesses being honored this week
illustrates the dynamic and innovative nature of small businesses [00:04:00] in the United
States. Everything from a helicopter pilot school, to a pet resort, to a tool and die
company, are being honored. Congratulations to all of you.
Staples is proud to be a sponsor of National Small Business Week. We have a deep appreciation
for small businesses, and we understand the vital role that small businesses play in our
communities and our economy.
More than 50 percent of the Americans own or work for small businesses. Small businesses are
the key to driving economic growth, creating two out of three jobs in the United States
each year.
At Staples, our history gives us a unique perspective on the drive, innovation, entrepreneurship,
and challenges behind small businesses. It wasn't that long ago when we, at Staples,
were a small business, ourselves. Our company is only 27 years old, and we were founded
on the same spirit that drives many of the people in this room tonight. In fact, our
founder, Tom Stemberg, invented the office supplies business on a rainy night in July,
when he couldn't find printer ribbon for his typewriter. That takes you back a while. Our
first store was opened in May of 1986 just outside of Boston, in a town called Brighton,
Massachusetts. Today, 27 years later, we are a global company with 88,000 employees, and
we've grown into the second, world's largest Internet retailer.
Even though we're no longer a small business, we're still driven by the need to innovate
and adapt the changing world, just as many of you are. We've transformed our company
over the years, from a cash and carry retailer [00:06:00] to a company with a contract unit
that supports two-thirds of the Fortune 100. We went from a bricks and mortar retailer,
to a true multi-channel player that lets our customer shop in our store, online, and on
your mobile devices.
Most recently, we launched our reinvention that is transforming our business. We're going
from a company focused on office supplies, to a company that's going to offer more than
one million items. We put small businesses at the center of our efforts, as we fulfil
our vision of providing all the products your business needs to succeed. We haven't forgotten
what has gotten us to where we are. We owe a large part of our success to the support
of small businesses just like you folks in this room and everywhere around the country
everyday , we are inspired by the stories we hear from customers. Stories of entrepreneurs
pursuing their passions, stories of success fuelled by hard work and innovation. Once
again, I 'm proud , and it 's a privilege t o be here on behalf of Staples as we celebrate
the best o f small business in the United States. Thanks.
Michael: Thank you, Patrick. Now, I have the special honor of introducing and saying a
special thank you to the administrator of the SBA, Karen Mills.
Karen Mills has been travelling around the country this week as I said, meeting small
businesses in Seattle, Dallas, Pittsburgh, and St. Louis, and engaging with them about
the things that matter to them most, and highlighting the things that we can do to help them start
and grow.
I 'm also going to be introducing Jack Dorsey, [00:08:00] CEO and co-founder of Square. Perhaps
we can have Administrator Mills and Mr. Dorsey come on up and take their seats. I also have
the privilege tonight of introducing three small business owners who are going to participate
in the panel discussion with Administrator Mills and Mr. Dorsey.
First, Doug Povich of Red Hook Lobster Pound, DC . Founded in New York by husband and wife
Ralph Gorham and Susan Povich, the Pound was in the first wave of food vendors a t the
Brooklyn Flea. In 2010, the Pound 's food truck , Big Red , hit the streets . Thanks
to Doug, Washington DC now has two of its own beloved lobster trucks. They are SBA favorites,
by the way.
I'd also like to introduce Brian Sykora of Pleasant Pops. Pleasant Pops was born in 2009
when co-founders Brian and Roger couldn't find their favorite traditional Mexican ice
pops, called paletas, here in DC. They now have over 100 flavors, all of which are original
recipes made from locally sourced produce, herbs and dairy. With the help of SBA assistants
along the way, you can now find Pleasant Pops at DC's Farmer's Markets, in their truck , Big
Poppa , and their first brick and mortar store, which opened in September 2012 .
Our third small business participant this evening is Mark Warmuth of Swing Coffee. Swing�s
began in 1916 under the watch of Michael Edwards Swing , and over the decades, the company
has continued to grow and thrive. In 2005, Michael's granddaughter decided it was time,
at the age of 87, to relinquish control of the company, and Swing�s Coffee passed into
the very capable hands of Mark Warmuth in 2006.
With that, please welcome Administrator Mills , Jack Dorsey , and these three impressive
small business owners [00:10:00] to the stage.
Karen: Thank you very much , and happy Small Business Week to everyone . I want to welcome
you all , and I particularly want to welcome our small business winners from all around
the country . Raise your hand , who are here . Welcome , and congratulations . We are going
to be honoring you tomorrow.
I have been travelling this week. Usually, we have National Small Business Week here
in Washington, but this year, we decided to take this show on the road . Monday was Seattle,
Tuesday was Dallas, Wednesday, St . Louis. Today, we were in Pittsburgh, and tonight
and tomorrow, we are here in Washington, DC .
Why did we do that? We did it because it was time to be to the ground with America's small
business owners. We did it because small business is really fuelling our economy. Tomorrow,
you 're going to see President Obama 's video, but from Day 1, he has known that if we are
going to create jobs in this country, it's going to be because of our entrepreneurs and
small business owners.
We are delighted to be able to celebrate, but we also said we want to be able to provide
the tips and the tools that small businesses need, because their time is valuable. Another
thing we did , is we decided to use more technology this year . Good idea, right? We decided that
if people couldn't come to those cities, we made sure they could still see some o f the
tips and tools by live streaming. [00:12:00] We have had literally thousands and thousands
of people with us all week over the live streaming. We're going to continue that tonight, so hello
to everybody who is with us virtually, as well.
I want to talk for a minute about technology. One of the things that we noticed when we
started the week in Seattle , we were on the Microsoft campus, and one of the subjects
was how technology is levelling the playing field . Small businesses now have opportunity
in two areas, and we�ve got some great examples of all of that here tonight.
First example is people who use technology to develop a whole new business. they're entrepreneurs,
like Jack, who is a serial entrepreneur, and they find a way to use technology to create
a whole new product or service that changes our world . That's really what he has done
with Square, but also, as you all know, he's the founder of Twitter, co -founder of Twitter.
Well, there's another way that small business really uses technology an d it levels the
playing field, which is even if you 're making coffee, or ice pops , or lobster rolls ... came
from the great stat e of Maine , you can tell where my preferences lie . . . you can also
expand your business using technology, and it levels the playing field. In fact, we've
had people start export businesses, that they never could twenty years ago, because they
can market on the Web .There are so many opportunities to use technology , and we thought we would
sort of celebrate that this evening by hearing some stories .
I want to start with Jack, because everybody's done [00:14:00] hearing his story. Even though
a lot of people know it , tell us about becoming a serial entrepreneur. How did you decide
that you were an entrepreneur, how did you start this business, and how did you start
so many successful business in sequence?
Jack: First of all , thanks for having us. It's going to be a fun conversation. I guess
, I never really thought about being an entrepreneur . I never really thought about building a
business. I, in fact, never wanted to be a programmer when I was growing up, but I had
some ideas.
I really fell in love with cities because of my parents. My parents lived in th e city
o f St. Louis, Missouri, and they stuck by the city as people were moving out of it to
the suburbs, and I developed this fascination with how the city worked. I just wanted to
see it. I wanted to see what was happening in every part of the city. In order to do
that, I needed to know how to program. Because I got this computer when I was 8 years old,
it was a Macintosh, we got an IBM PC Jr. a few years after that, and I did whatever it
took to make what I wanted to see work . That involves programming, that involved learning
Math , that involved learning about graphics. Little by little, I could see more of my work.
I think I found that a common thread in all entrepreneurs. It 's a common thread in all
businesses, is that it doesn't start by you waking up and saying , "I want to start a
business." It starts by you waking up and saying, "I 'm really passionate about this
thing, and I'm going to do whatever it takes to make it work."
If you look at the definition of entrepreneurship, it's really you take significant risks in
order to do something. It usually takes significant financial risk in order to do something. some
of this , I learned from my parents my father , when he was 19 years old . . . this is a
good story , and I 'll move on . . . My father , when he was 19 years old , a started a pizza
restaurant with his best friend [00:16:00]. They called the pizza restaurant Two Nice
Guys. It started doing really well in St. Louis, Missouri, and they needed to hire some
waitstaff . They made one rule between the two best friends t o make sure that the friendship
stuck , and also the business would thrive . The rule was they would not date any of
the waitstaff they would hire. The first person they hired was my mother. My father fell in
love with her, went to his best friend a week later and said, "I broke the rule. I fell
Iin love with Marsha. The business is yours." I was born ten months after that. It started
from an entrepreneurship story , and I guess that 's always influenced me, as well .
Karen: I knew there would be some good stories on that. Let's turn to our panel. Let me start
with Doug , lobster rolls . I understand that you're a lawyer .
Doug: Unfortunately.
Karen: You also have a food truck . How do you divide your time between being a lawyer
and the food truck, and which career is winning?
Doug: That 's an obvious answer . I've been a lawyer for over 25 years, and right about
the 25 -year mark , which was two and a half years ago, my cousin , Susan , called me and
said, "You have any interest in expanding our business down to DC? " And I said , "Well
, I 'm a full-time lawyer . How am I going to do that?" And she goes , "I don 't know
. You figure it out."
I had a friend who was in the food service business. I said,"I don't really want to start
a restaurant, but this food truck idea seems really cool.� Lo and behold, he left his
well -paying job and said, "Sure, I 'm happy to help you out with this."
We opened in [00:18:00] August of 2010 at Fairwood Square here in town, with literally
300 people in line at lunch for lobster rolls. At that point, I think I said, "This law thing
is not long -lived."
Karen: Exactly. Let's talk a little bit about the SBA for a second. I know that several
of you started with an SBA loan. Bryan, I think you 've got one going . Tell us how
that fits in . Jack, you might jump in, because I think you have some SBA history, as well.
Bryan: When Pleasant Pops started three years ago , we didn't have any capital. We both
just graduated college a couple of years before. We bootstrapped it from the beginning . Our
first popsicle cart was about $2 ,000 and our first popsicle molds, we bought off Amazon
for $150 or so , and we thought we were big time. We thought we literally made the investment
we need to build this business.
Fast forward a couple of years later , seven farmer's markets later, our food truck later
. . . we needed to open a store , and we realized , "Wow , that 's a lot more than a popsicle
cart and a couple of molds. " That's where the SBA was really helpful and instrumental
in opening the store, because it involves a lot of equipment, construction, things we
have never done before. I think along the way, with this startup capital , you can bootstrap
it for a few years , we also did a Kickstarter campaign, which was extraordinarily successful
. We raised $13,000 on Day 1. That, in combination with the SBA loan that we received, allowed
us to open our store [00:20:00] this past September.
Karen: That�s great. Jack, you said that you had some SBA history, as well.
Jack: I 'v always been interested in the interface between starting something in the organization,
starting a company and the government. I think what we need more of . . . it's just so hard
to start anything. Not only is it hard to start, but you have people telling you no
constantly. The SBA represents a simple interface into government, which enables you to navigate
more and to go through some of those hurdles and some of those barriers.
I think what we all need to do though, is to make sure that we're constantly giving
feedback in terms of . . . there's actually some friction here and this doesn�t make
sense, and we need to improve this, because it actually improves for everyone, as well.
I think the more we can focus on simple interfaces into our government, we can move fast and
we can do more impactful things in the world.
Karen: Mark , tell us about your business and also your SBA history . You've got one
of the oldest businesses, but you've just taken it over.
Mark: I'm the owner of the M.E. Swing Coffee Company. Swing's has been around for 97 years.
Prior to my purchase of Swing's in 2006, I owned a commercial bakery. I bought a small
bakery, and that was my initial foray into entrepreneurship.
When I bought the first business, the bakery ... my father was also an entrepreneur as
well . . . At his urging, he suggested I take out an SBA loan. It 's an easy entry into
financing a business and the benefit of having that type of a creditor . . . building your
credit rating score as you go, is extremely beneficial. One of the hardest things for
a small business owner to do is to obtain capital to finance your business. As you go,
[00:22:00] if you can build a credit rating and pay the loan off on time, it�s much
easier to obtain additional funding down the road, which helped me with the purchase of
Swing�s several years later after selling the bakery business, having a higher credit
score than previously.
Karen: Because you paid back that SBA loan, right?
Mark: On time. Yes.
Karen: All of you, I believe, are using some kind of technology. Talk a little bit about
do you all use Square?
Food trucks, definitely, taxi drivers, where else have you seen Square? Just about everywhere.
Talk a little bit about Square, and then maybe you guys can talk about Square and other technology
that you use in your businesses.
Jack: Our mission at Square is pretty simple, which is to make commerce easy. There�s
a lot of payment companies out there, and there�s a lot of people focused on payments,
but it turns out that no one really wants to pay. No one wants to think about paying.
They want to think about commerce, and commerce is, the definitio nof the word, is the activity
between buyers and sellers. It�s very similar to conversation, it�s very similar to communication.
Somewhere along the line, commerce became more abstract, it became harder, more friction,
harder to understand, whereas communication always gets easier, frictionless, and more
people can participate into it.
We asked a very simple question of why can�t commerce be as free and easy as communication.
It is a social thing. All these businesses you see before you are making a very, very
social interaction. Every single transaction is a conversation. It just happens to have
another form of value, which is a monetary value instead of an information value you
find typically in communication and conversation.
That�s the basis of what we do. We started [00:24:00] by recognizing the fact that no
one is carrying cash anymore, checkbooks, and they�re all paying with plastic cards,
and they want to use them everywhere, yet a lot of small businesses and individuals
were left out of processing credit cards because it�s just way too hard. You had to go and
get a credit check to accept credit cards, which doesn�t make sense to anyone. People
are giving me money, why do I need to get a credit check? I�m not spending the money,
they�re giving me money.
We looked at that and we said, �How can we make that simple? How can we make it easy?�
We turned a one-week process into a two-minute download and a sign-up where we give you a
free credit card in return. We also charge a simple rate, which is 2.25%. The money goes
in your bank account the very next business morning.
That was revolutionary because a lot of businesses, even today, face ths interchange where they
have to pay anywhere from 1.79% to 10% to accept a credit card, depending on the card
that the payer uses. Most merchants don�t even know that they�re doing this. They�re
told that they�ve got to pay 1.79%, and then there�s an asterisk there. The asterisk
says for qualified cards only.
We simplified the pricing, we simplified the application, we simplified what it meant to
actually accept payments. That resonated with people. We just thought flourish around the
United States from people selling on Craigslist for a garage sale, to coffee carts, to food
trucks, to actual small businesses. The thing I�m most proud of is we�ve validated that
with a partnership with Starbucks. Starbucks is using Square in 7,000 of their stores in
the United States, and it�s the exact same tool that our individuals are using. Technology
truly does level the playing field in this case. It means that you can compete on merit
of idea, and merit of product, instead of access to technology, because everyone has
access to the same technology. It�s just a question of how much your passion drives
you [00:26:00] and your motivation. That�s a beautiful thing to me.
Karen: Let�s hear from some of the users. Has it worked?
Doug: Frankly, I always say that my business would not be in business were it not for two
things: Twitter and Square. This gentleman is responsible for both of them.
Karen: And lobster, right?
Doug: And lobster. When I�m looking to start my business, I realized that at our price
point, we needed to be able to accept credit cards. You look at how you�re going to accept
credit cards. The companies try to sell you a literally $5,0000 to $10,000 Point Of Sale
system to put in a truck. I�m saying, �No, that�s not going to work.� There�s got
to be a better way. This was the same time that the iPad was coming out, and I said,
�Something has to facilitate this.�
Lo and behold, I come across Square, and it was a godsend. For literally the cost of an
iPad, we were able to get up and running without the need to do all of the merchant accounts
and all the complication of what it takes to accept credit cards. I think that because
of that, we are where we are.
Karen: Do the rest of you tweet about your business, as well? Do you tweet when then
coffee is up?
Mark: We do. We will pick strategic points in the course of the day to tweet, when we
know the people are paying attention to their Twitter feed. We try to post not just information
about us like, �Look at me, this is what I�m doing.�
We try to engage our customers and make sure that we�re acknowledging our wholesale customers,
what they�re doing with their businesses, because it�s important to build a community
between your customers and yourselves, and not just focus the attention on my business,
but �How can I expand my business by focusing on the successes of my customers?� Periodically,
we�ll just engage in conversation [00:28:00] with those customers that come in for a cup
of coffee, and they flash a picture about the latte, or at work of the latte they received,
or the good cup of coffee that they had.
Karen: Your customers are tweeting about the latte.
Mark: That�s the point, is to engage in conversation, to get them to do more talking
about it than us. One thing I might say about Square though, is that a year ago, the folks
from Square came out and paid us a visit at our shop on the corner of 17th and G. It�s
a very busy coffee shop near the White House. We had just invested in one of those $5,0000
Point of Sale systems and weren�t ready to switch over to Square.
Most recently, a month ago, we opened a coffee bar and new roastery on and Alexandria and
gave Square a shot. Withhin a few more months, I�m going to be switching over to Square
my shop downtown because it�s really pretty amazing what it can do. What�s really exciting
about it is the customers that walk in and the feedback that you get when they see the
iPad on the stand and it�s just a very engaging way to get money from customers, which is
kind of fun. They like it a lot.
Bryan: I can say at the farmer�s markets, the old credit card terminals were really
prevalent three or four years ago when we got started. You�d have to plug it in. Where
do you plug in a credit card terminal at a farmer�s market? They are constantly running
out of batteries. People running around finding an outlet, borrowing it. Three years in business,
I�ve seen pretty much everyone adapts where at the farmer�s markets we visit. It�s
probably 80% or 90% in those markets.
From opening a brick and mortar store, we also looked into the $10,000 Point of Sale
system. We got flyers every single day, sales reps from very large Point of Sale companies
coming in the door. We said, �Well, we have an iPad that we�re going to reuse. About
$300, a little wooden box that it sits in.� Everytime a customer comes in the door, they�re
wowed by [00:30:00] �How do you have a wooden cash register that accepts credit cards?�
It�s pretty phenomenal to watch the reaction. I don�t know about any other business, but
I�ve never seen someone get so excited about buying a popsicle.
Jack: It�s an exciting thing. Top of mind for any business, small, medium, or large,
is always acquiring new customers, getting new customers, and also keeping the ones that
you have, and establishing loyalty. How do you all think about new customers and driving
more people to your businesses?
Bryan: From our perspective, it�s all word of mouth. Twitter is a fantastic tool, especially
when we got started, being at one market and open for business four hours a week. Communication
tools like Twitter were critical to get us started to at least tell people where we�re
going to be when. If we opened at a new market, how do we communicate that?
Since opening the store, you realize how local and kind of community-focused your business
becomes as a retail operation. Roger, my business partner, spent some time doing political organizing.
About a month in, we saw our customer numbers plateau, and he said, �Why don�t we just
go out and knock on doors?� I said, �That sounds crazy, but sure, why not?� We took
a map, drew a circle, about a three-block radius around the store, and we knocked on
every door. It worked, because we were kind of off the beaten path a little bit. Even
with great technology tools, there�s also something to be said for just going out to
meet your neighbor and say, �Hey, we�re here.�
Doug: From our perspective, we have a very limited amount of time to engage with our
[00:32:00] customer at the food truck. You have literally seconds to do it, to make an
impression and make the sale. Our goal is to have the sale behind the scenes, have our
cashiers engaging with the customers, making sure that they come back. Twitter and Facebook
are also our main vehicles for engaging customers.
In DC, the way the rules were, literally, we would not be able to stop our truck unless
we had a line already formed. It�s called the ice cream truck rule. That�s why ice
cream trucks have bells so they can attract people when they stop. Well, we had Twitter.
We tweeted where we�re going to be at the location. Lo and behold, we pull up, fifty
people standing there waiting for us, saving a spot for us. That type of engagement with
your customer ... we�ve had people early on come up to the window and literally faint
because they were so excited they finally got to the lobster truck. We absolutely use
social media to engage our customers on a regular basis.
Karen: That�s great.
Mark: For us, as a coffee roaster, we�re certainly not the size or magnitude of the
big green store Starbucks, no offense. Our focus has always been to ... you work a little
harder, you aim a little higher with regard to the quality and craftsmanship of the work
you do. We don�t advertise. Maybe for that reason, we�re probably one of the oldest
coffee companies that nobody has ever heard of, but there�s always a line from the register
winding around or store to the front entrance, because our baristas are well-schooled, very
well-trained in how to make a drink. Our coffee is fresh roasted daily. There�s something
pretty positive about a local company that does really solid work. To that point, our
business is very successful and we don�t advertise but as of late, our focus has been,
�How do we extend the brand of M. E. Swing [00:34:00] Company beyond the people who live
within a four-, five-block radius of our coffee shop and are close to our roastery?�
We are now heavily focused on a social media campaign utilizing Facebook and Twitter to
engage with our customers and make people aware of, �Oh yes, there�s this really
cool coffee company that�s been around forever and you�ve never heard of them, but go on
back because the drinks are really good.� That�s going to be for us going forward,
how do we create this awareness of Swing�s that�s been around forever. I think, sometimes
if you�ve been around too long, you kind of blend into the background, so we�re trying
to reinvent the company in a way that makes us almost a startup within the shell of a
hundred-year old company.
Karen: Jack, I�m going to come to you for a question but first, I want to tell everybody
we�re going to have a treat here, which is in a few minutes, we�re going to ask
you to ask some of the questions. Think about your question while I ask Jack for a second.
Lots of folks out there want some advice from you. You�ve clearly been a successful entrepreneur
several times over, kind of the dream of many small businesses and entrepreneurs. Give your
advice in this context. Tell them about the biggest mistake you ever made, or a mistake
you might have made, and what advice you can give them from that.
Jack: I think the biggest realization I�ve had over my life is how important ... you
hear this a lot but it�s so true and so simple, but how important the team is, and
the people that you work with, are. We kind of see this directly, and the way I�ve been
thinking about it most recently is if you have an issue in your company, if you have
two divisions who are not talking together, if you have two people who just can�t get
along, [00:36:00] that friction will manifest in the product itself. Your customers will
see that friction, and that means you are putting your company�s issues, your issues,
before your customers, which is just rude and selfish.
I don�t want to be rude or selfish, so we make sure that we design and engineer the
company and the organization as much as we do the product and the service that we built.
This has come true again, and again, and again.
In the early, early days of Twitter, we were growing very quickly, but we were also going
down all the time. We had a lot of service issues. The real cause of that is because
our Engineering staff wasn�t talking to our Operations staff enough, and in the right
way. It became a communications issue, which was funny, because we were building a communications
company, right? We weren�t communicating effectively, and that actually manifested
in downtime, that manifested in failure. It�s the worst feeling possible. As we were down,
we felt terrible about it. It inspired us to get back up, but at the same time, it�s
really hard to do. Simple communication definitely helps, and the thing that helps simple communication,
is just having an understanding how your business is doing.
I�ve been keeping a journal since I was fourteen years old. That was probably the
best thing that I�ve ever done in my life, because I can see motion. We do the same thing
for the business. You want to record everything. You want to have a sense of how things are
doing, very simply. How many cappuccinos are you selling today? How many lobster rolls
are you selling today? Very simple data that allows you to make decisions and allows you
to make the choice whether you want to stay more of a lifestyle. My mom had a coffee store
when I was young. She wanted three employees and that was it. She loved it. Or you want
to go around the world? It�s all dependent on the data, and the team, and the people
that you�re working with [00:38:00], and then your ambition, and your drive. That was
probably the biggest mistake, was not focusing on the team enough.
Karen: I imagine all of you have some growth plans in mind. Do you each have a mentor or
somebody that you work with on your business plan and your growth plan on a regular basis?
Because if you don�t I�ve got an opportunity for you.
Mark: I do not, and this will go back to the biggest mistake that I probably made as a
business owner, is taking for granted what goes into making that really good cup of coffee.
You go into a coffee shop in the morning. If it�s good, you don�t appreciate the
craftsmanship that the barista puts into every drink. There�s a lot of skill and training
that goes into teaching that barista how to make a drink. The coffee is going to taste
a certain way because the person who is doing the roasting spent years on the roaster working
his craft and doing it the right way. The supply chain goes back to sourcing quality
green coffee. Somebody has to know the difference between good coffee and bad coffee.
For me, buying the business ... I loved coffee before I bought the business, which is why
I bought it, but you don�t always know what you don�t know until years passed. If you
can find that mentor, I highly suggest it. A lot of times you don�t know those mentors
until you�re a few years in. I think I�d still be in the same position now but would
have gotten there a little bit quicker had I had a few more people on my team that helped
me out along the way.
Karen: This is something that we hear quite a bit. All of those who are here from the
SBA, do me a favor and raise your hands. If you do not have a mentor or advisor that you
see [00:40:00] on a regular basis and you�re a small business owner out there, you need
to see one of our SBA folks before you leave here tonight, because you should. Many, many
small businesses have told us that they would be ... advice has saved them a year and a
half, or saved them from making a mistake that another entrepreneur had made. Because
you�re so busy running you�re business, you don�t know what you don�t know.
One of the things that we do is collect a lot of data on this. We know that small businesses
that have mentors and advisors get more sales, more profit, hire more people, they have more
longevity. Go to sba.gov if you are watching us on the live feed. You can put in your zip
code and you can get the names and numbers of the SBA folks near you. The best news about
it, it�s free. There�s no excuse.
We have some hands getting ready, and I think you might want to ... Doug just answer that
question, I saw you have a few things to say. Then I want some questions from the audience
if we have any.
Doug: I have had some very awesome mentors in my legal career. When I started the food
truck business, it was new and nobody, I felt, really knew the food truck business because
it was so new. What I found is that my fellow food truck operators were my best mentors.
We literally formed an association. We sat around a table, we say what�s working, what�s
not working. It has been a mentor by committee, if you will, and it�s worked really well.
Karen: It�s like a small business cluster. This is something we�ve started at the SBA,
and we find that small businesses, when they cluster together, they actually have [00:42:00]
more power, and they do end up sharing best practices and mentoring each other.
Does anyone in the audience have a question? Right down here in front, and then a couple
in the back, afterwards.
I�m going to ... do that, and then we�ll repeat the question for the live feed.
Female: Two questions. How did you advertise to get 300 people there your first day? What
was your kickstart program?
Karen: How did you get 300 people there the first day, and what was the kickstart program?
Doug: Right. We�ve never advertised at all in formal print media or anything like that.
We approached the food bloggers in the area, we got them interested in our grand opening.
It was delayed not for strategic reasons, just for mechanical reasons. By the time we
opened, there was such a buzz about our business that they showed up. Simple as that.
Brian: Something that we realized a couple of years ago was it�s very hard to ask friends or family for money
to get your business started. Kickstarter is a tool that allows you to do that. Instead
of equity, it�s rewards-based. When we were thinking about our kickstarter campaign, we
thought, �What are some things that people will get excited about?� Our most popular
level for our kickstarter campaign was actually very small, it was about $25. People would
give $25 and they would receive an invite to our grand opening, a preview to the opening
of our store. Kickstarter is an online tool. You can set the duration of the campaign [00:44:00].
If you want it to last a week or six weeks. We chose 30 days. We raised over half of our
goal in Day 1, because it built so much excitement.
The great thing about Kickstarter is if you don�t reach your goal, you don�t get anything.
It�s a way to test your idea. I would have been very worried had we launched our Kickstarter
campaign and not been able to get close to the goal. It was really twofold. One way was
to ask our friends, family, a lot of people we didn�t know, people we had met five years
ago chipped in ... it�s really a way to build excitement and validate your idea.
Karen: That�s great. Question, there in the back. The one with the microphone, then
the one standing up. Stand up, tell us who you are.
Andrea: Oh dear. Okay, I�m Andrea York. I�m a lawyer, I still like law. I don�t
think I�m going to be opening any food trucks soon. I�m interested in the Kickstarter
campaign again. Was there a relationship between your ability to generate funding through Kickstarter
and your ability to get the SBA loan. If not, then what kind of collateral or criteria were
you able to use to qualify for the SBA loan?
Brian: That�s a great question. Kickstarter came first. We actually announced our Kickstarter
campaign on the same day we made it public that we were opening a store. That generated
a fair amount of media attention, and all those people we didn�t know chipped in $5,
$10, some as much as $500. That was also a way for us to go to our local credit union
and by extension, the Small Business Administration and say [00:46:00], �We have 425 people
who think this is a good idea and have put money behind it.� It�s not just having
the capital, but also convincing our landlord that it was a good idea to sign a lease with
a popsicle business.
Karen: Gentleman back there.
Arnold: Thank you. I�m Arnold King, King [inaudible 00:46:28] Solutions. My question
to you all is [inaudible 00:46:33] how do you determine [inaudible 00:46:36] technology
because majority of the time, operations is about 80% to 90% of business planning.
Karen: Let�s understand your question again. It�s about operations and technology?
Arnold: Operations, technology and SWOT analysis.
Karen: Oh, SWOT analysis. Have you ever used a SWOT analysis? How do you plan for your
operations and how do you make sure you don�t end up with no lobsters one day?
Doug: It�s trial and error, basically. You try to plan. Everything I know about small
business is that you need to plan and think about this, and all of that was kind of out
the window after the first day. You do trial and error, you try to collect data, as Jack
was saying, and know what you�re doing right based on that, but the production piece of
it is critically important. We have a very valuable product inventory. If it�s fresh,
it has a short shelf life. If we don�t manage it very well, we can be out of business pretty
quickly.
Like I said, it is art and science. Mostly art, at this point, because of all the variables
involved. We do try to track those, but don�t always [00:48:00] get it right.
Karen: Where do you keep all the lobsters that are in your working capital inventory?
Are they like in the bathtub?
Doug: The lobsters are alive up in Maine. When they get to us, they�ve already been
cooked.
Karen: Couple other questions. Do we have one on this side of the room?
Meredith: Hello. Hi. I have a question.
Karen: One back here, then over here.
Meredith: I have a question. I would like to know ...
Karen: Tell us who you are.
Meredith: Oh, I�m sorry. Meredith, and I have a non-profit organization. I would like
to know what are your everyday rules, something that you do everyday that benefits your business?
Karen: What are your everyday rules? Something that you do everyday that benefits your business?
Jack, you probably have this because you have a big and important culture in your firm,
and you probably have a lot of everyday rules around that culture. Maybe you guys also want
to chime in.
Mark: For me, the first thing I do is brew a cup of coffee and make sure that it tastes
a certain way. I�ve been pretty tight with my team at my roasting facility. We will get
together every morning and we discuss all elements of the business, whether it�s social
media related, whether it�s wholesale customer related, whether it is complaints. You�re
going to get complaints as a business owner as well, and how you address the issues that
your customers may have will kind of set the path for you as well as far as the type of
business owner that you are. We try to make sure that we�re doing things right across
the board.
We�ll also address ... there�s a social component to your business as well. What can
you do from a social level to make sure that you�re giving something back to the community?
That�s things that we address on a regular basis to make sure that we�re doing things
the right way and we don�t get calls from angry customers, or people knocking on our
door [00:50:00] with issues. It seems it�s working very well for us right now.
Doug: We ask our employees every morning to set a personal intention so that they have
a purpose when they go out that day. We think that the business on purpose is really important.
For example, our grill person might say her intention is not to burn any buns today. The
cashier might say, �I�m going to try to make ten people smile when I interact with
them.� The expeditor might say, �I�m going to get our roll per minute count up
to three.� It has a really profound effect, I think, on not only our business, but also
on our employees.
Jack: One of the things that�s been most successful for us is we have a very, very
transparent culture and a very transparent company. One of the things that we do everyday
is every single meeting that we have in the company, someone takes notes and those notes
are sent to the entire company.
In Square�s case, that�s 550 people and they all have access to the same information
that everyone has, which works to keep everyone on the same page, but also, we get all these
new diverse perspectives and it makes people think in different ways and that creates a
lot more creativity in the organization. Keeping people on the same page, keeping people on
the same purpose and just making sure that everyone sees that, has been the most transformative
for us.
Brian: After making coffee and checking the temperature of the freezers, become an amateur
mechanic in the process, making sure our pops don�t melt, I�m a big believer in quick
standing meetings, and so we spent a lot of time on our feet making pops. It�s also
a great way to meet. No one gets too comfortable, and I think it�s a good way to keep checking
in with the team.
Karen: [00:52:00] That�s good to know. We also, at SBA, have stand up everyday in my
office. If they stand up, it�s fifteen minutes. If they sit down, it�s half an hour, right?
I think what I�m going to do is ask the panel for any last thoughts for our small
businesses and entrepreneurs out there as we come to the end of Small Business Week,
quick word of advice.
Brian: Quick word of advice is that there are opportunities everywhere. I would say
most of our best opportunities have just come from talking to folks at the farmer�s market,
finding out what they do, or why they�re interested in what we do.
Mark: For me, I would say you learn a lot about yourself and you learn to do a lot of
different things, maybe not so well, but you learn how to do a lot of different things.
As a business owner, it can be very lonely at times because you can�t always tell somebody
else to do it, or you can�t delegate to somebody else. If something is broken, you
have to fix it, otherwise your business fails or it doesn�t work that day. Whatever you
can do to engage in some type of connection with other food truck owners or other people
of like type businesses will help, because you do need a support structure, maybe not
so much within your business, but in the same type of business. It will help you out a lot.
Doug: I would say the best thing to do is to, at all steps in your business, simplify.
Keeping things simple is key in my view. We do one thing, we do it really well, and we
stay focused on that. Corollary to that is obviously, your customer is supreme and hundred
percent focus on what they want and keeping them happy.
Jack: I definitely agree with the simplify point [00:54:00]. The best tool I found is
a very simple one, which is asking the question why. It�s the easiest question to ask, it�s
the hardest question to answer, but it always gets you to something that is more essential
and much, much deeper, enriches your business, engages you, as well. Why can�t people accept
credit cards from their phones? Why can�t people communicate wherever they are with
their phones? That gets you to a really solid answer that I think can move you forward very
quickly.
Karen: What a great way to kick off the Washington portion of National Small Business Week. I
look forward to everyone joining us tomorrow for celebrating our winners, for tools and
tips. Also, join us online at sba.gov anytime in the future.
Please join me in thanking some terrific, fabulous entrepreneurs who took time to be
with us today. Thank you.