Peanut butter and jelly. Peas and carrots. Abbott and Costello.
Every great combination is made by two equally solid parts coming together to make something fantastic. And so it was a great fortune for both when James Taylor and Arun Pasrija met up and formed CHR Solutions Inc.
On their own, both men have a strong business background and a good amount of battle-tested executive experience. But, together, they’ve mixed their skill sets to create something special at CHR Solutions.
Taylor, the company’s chairman and CEO, is a bit of a serial entrepreneur, with CHR Solutions being the third company he’s founded in the last 12 years. Along the way, he’s become the king of the marketplace. Today, he spends roughly 85 percent of his time out in the market beating his CHR Solutions drum to help drive new business and acquisitions to build the company into a powerhouse for the middle market.
Pasrija, on the other hand, is the hand that cranks the wheel at CHR Solutions. With a strong focus on operations, cost management and efficiency, Pasrija, the president and chief operating officer, spends his time making sure the company delivers on its promises. It is his follow-through and close eye that ensure CHR is always growing from a solid foundation.
With the two working in tandem, CHR has grown from a basic business plan in 2003 to the thriving enterprise it is today, with a realistic goal of growing into a $100 million IT/telecom infrastructure services company. Beyond that, the 14-person management team at the company has CHR Solutions poised for the incubation of various telecom growth strategies. With expansions in the works, the company is ready to tackle tomorrow through a culture of innovation and expansion.
How to reach: CHR Solutions Inc., (713) 995-4778 or www.chrsolutions.com
Power & Utilities
Call the story of StarTex Power one of Robert and Marcie vs. Goliaths.
Marcie and Robert Zlotnik founded StarTex Power in 2004 with the goal of bringing the highest standards of customer service and competitive pricing to the retail electric industry. As a result, the two have had to create unique systems to tackle the big kids on the electric power block. Since Marcie, who serves as chairman and COO, and Robert, who serves as president and CEO, were unable to find any venture capital firm or angel investor for their start-up, the two initially drew no salary and invested more than $300,000 of their own money to keep the business alive.
Along the way, they created a one-of-a-kind hedging program that locks in customers to the lowest rate and structured an innovative supply agreement that allows the company to hedge without tying up unreasonable amounts of capital resources. Additionally, they utilize a broker model to extend their sales force to a wider audience of residential and business customers. StarTex Power evaluates each customer and it proposes pricing to ensure that it only takes on profitable opportunities.
In order to better serve those customers, StarTex Power provides simple, clear and easy-to-understand invoices that show the electricity rate promised by StarTex Power and the actual usage something that greatly differs from the industry practice of a nearly incomprehensible charging rate. And when customers do have questions, StarTex Power makes responding its No. 1 priority. In fact, both Zlotniks list their e-mail addresses on the company Web site.
As a result, the company hasn’t just become a customer service example, it has also felled the Goliaths and grown into a success worthy of a story all its own.
How to reach: StarTex Power, (713) 357-2800 or www.startexpower.com
Oil Field Products & Services
Bruce A. Streeter first saw the vision for success while on vacation during his employment at Offshore Logistics.
Although his employers did not have interest in the idea at first, Streeter saw a great opportunity. Streeter, after another trip, convinced the chairman of Offshore Logistics to support his vision for the company to return to the support vessel industry. In 1990, Offshore Logistics was purchased by Gulf Applied Technologies and later became known as GulfMark Offshore.
Today, Streeter leads the company, which has grown from three to 95 vessels operating in the North Sea, the Americas and Southeast Asia. Because of the company’s philosophy to operate with a lean, extremely skilled corporate team, lower overhead operating costs and an organization that can overcome the obstacles of the industry, Streeter, as president and CEO, has been able to breed success at GulfMark while staying clear of head-count reductions.
Another aspect of GulfMark’s success is its versatility. Streeter’s company designs ships for use in the North Sea, the Americas and Southeast Asia, while at the same time, the ships can also be used to perform multiple tasks. In turn, the company creates marketable, multipurpose vessels, which secure higher margins.
Aside from having a marketable product to fall back on in the tough economic times, Streeter has secured a method in GulfMark that will allow it to outlast the undulating economy. The company’s approach to business is to take advantage of their current market instead of charging into weaker, uncharted waters. Streeter also believes that the diversification of his company’s fleet and the lower overhead structure have helped supplement GulfMark’s success. In the future, Streeter plans to strategically build his company by patiently making opportunistic purchases of vessel assets.
With the acquisition of a competitor in the Gulf of Mexico, this Houston-based business is already looking into the future.
How to reach: GulfMark Offshore Inc., (713) 963-9522 or www.gulfmark.com
Oil Field Products & Services
William H. von Eberstein Jr., president and CEO of ExPert E&P Consultants LLC, has always had a knack for entrepreneurship. After almost 30 years of on-the-job training with a single super-major energy company, von Eberstein left his position as director of project management for all North American deepwater operations to create his own company.
ExPert’s main role in the industry is to consult, manage projects and turnkey operations, and produce for the leaders of oil and gas drilling.
With von Eberstein at the helm, the company’s mission is to provide reliability, commitment, safety, diversity, teamwork, innovation and ethical services to its customers. The Louisiana-based company is able to reach and exceed its goals through excellent employees. ExPert prides itself with having employees who are multitalented, experienced have vast knowledge in drilling operations, complex directional drilling, engineering and technology.
The president and CEO has been able, with his entrepreneurial expertise, to create a company that is now a valued commodity in the oil and gas drilling industry. ExPert has three facets to its company: ExPert Consultants LLC, ExPert Riser Solutions LLC and ExPert Oil & Gas LLC. Von Eberstein hopes to also expand the ExPert business by adding a fourth facet, which will conduct business associated with a new patent of his that von Eberstein foresees as significantly supplementing and changing the way drilling companies mitigate a safety hazard aboard their drilling platforms.
Aside from enlarging ExPert’s services to its clients, von Eberstein expands ExPert’s services to the community. Because one of ExPert’s facets is located in an area of Louisiana recently affected by hurricanes, von Eberstein recognized a way to provide affordable housing for employees on-site while giving the company another competitive advantage to add to its already extensive list.
How to reach: ExPert E&P Consultants LLC, (985) 809-1280 or www.expertep.com
Business Services & Staffing
Throughout her career, Pamela Chambers O’Rourke has never fit the mold.
She felt stifled in her career as an IT consultant representative in the early-to-mid-1990s. She disliked having to follow the cookie-cutter pattern that restricted what she was allowed to offer her customers and soon realized that a firm that offered more services and had greater flexibility would have a good opportunity to thrive.
So in 1998, backed by a few silent partners, O’Rourke founded ICON Information Consultants LP. The firm specialized in identifying and recruiting IT, accounting, finance, HR and procurement professionals. And O’Rourke put the emphasis on catering to her customers’ needs through timely and thorough responses as well as ensuring that her solutions actually solved their problems.
Her flexible, can-do attitude remains the driving force at ICON. New employees are trained in the “ICON way,” which includes simple concepts such as “the customer is always right” and finding a way to “make it happen.” As president and CEO, O’Rourke walks the talk, continuing to take a commission and refusing to take a regular salary.
The results of O’Rourke’s entrepreneurial spirit are impressive.
Since its founding, ICON has achieved consistent year-over-year revenue growth of at least 20 percent with 2008 company revenue 3,000 percent greater than its first year. With more than 750 people employed nationwide, O’Rourke continues to seek out ways to be innovative.
She has expanded her business to meet client needs by introducing services such as human capital solutions, payroll and specialized project management. And she anticipates branching out internationally as her next phase of growth, with plans to enter Canada in 2010.
How to reach: ICON Information Consultants LP, (713) 438-0919 or www.iconconsultants.com
For approximately 65 million Americans, living without credit cards or banking relationships is a part of everyday life. Fortunately, PreCash Inc. can help.
With Chairman and CEO John Chaney’s vision, PreCash is one of the nation’s largest providers of convenient, real-time payment systems that convert cash into electronic payments. Chaney began running PreCash in 2001, and he quickly converted the Houston-based company of 175 software developers with no focus on current revenue and no sense of customer service into a company with a professional sales force selling its products to generate immediate revenue.
One of PreCash’s products is the Vision Prepaid Visa, which was incorporated into the business in 2004 with Chaney’s guidance. This prepaid debit card allows customers to manage their money better. This unique service provided by PreCash is accepted at more than 35,000 retail locations worldwide. PreCash also e-mails or texts transaction activity to clients in order to ensure clients are aware of their current account balance and transactions. Chaney’s company also has partnered with companies like Sprint and T-Mobile to accept PreCash bill payments.
Because of Chaney’s vision, the underbanked population of the U.S. is no longer forced to use high-fee, untraceable, inaccurate money orders, predatory check cashing services, or deal with overdraft and low-balance fees.
Despite the recent economic downturn, Chaney is continuing to drive innovation at PreCash. Chaney plans to add a saving feature to the Vision Prepaid Card and potentially offer a small line of credit. PreCash will also increase its advertising budget to reach more potential customers.
How to reach: PreCash Inc., (713) 600-2200 or www.precash.com
When John P. Havens was 23 years old, his father sent him to Houston to open the third office of the family seismic brokerage firm, Seismic Exchange Inc.
The firm his father founded in 1975 was one of the pioneers in the seismic data brokerage industry, which allows oil and gas companies to share their once proprietary seismic data via data licensing.
It didn’t take long for Havens to prove himself and turn the branch into the largest office and eventually the corporate headquarters of SEI, as well as earning Havens the title of president in 1988.
Havens recognized that, as a broker, SEI only received a commission for each license transaction it conducted and in order to expand the company’s opportunities and increase its revenue from every sale, it was imperative to own the seismic data the company brokered.
The year Havens was named president, SEI owned a seismic library of approximately 29,000 linear miles of 2D seismic data and no 3D seismic data. Today, SEI is the largest owner of 2D seismic data and one of the largest owners of 3D seismic data, currently owning or controlling 1.85 million linear miles of 2D seismic data and 40,000 square miles of 2D seismic data.
Havens has demonstrated a knack for understanding the industry’s direction as well as an impeccable sense of timing. He’s led SEI through more than 100 acquisitions over the past 14 years, many of which were conducted during downtime in the economy. The moves have resulted in a 50-fold growth of SEI’s seismic inventory.
Havens has built a trusted and respected team of key employees who mirror his understanding of where the seismic data industry is heading and are working to help move SEI toward the future.
And under Havens leadership, SEI continues to surpass its financial goals year after year.
How to reach: Seismic Exchange Inc., (832) 623-8300 or www.seismicexchange.com
Rand W. Key, senior vice chancellor and chief operating officer of Lone Star College System, is responsible for coordinating the administrative and auxiliary operations of the Office of the Chancellor. He oversees the system’s work force development and corporate college, human resources, general counsel, institutional research and effectiveness, public safety, campus security planning, and University Center. Key recently served as executive vice president of planning and development at the College of Southern Nevada in Las Vegas.
Q. Will companies need to keep continuing education in the budget to maintain a competitive advantage?
Yes. It is more important now than ever. Professional development and technical training is necessary to keep companies and employees in touch with their industry. This training also helps companies enhance skills, allowing the company to work leaner, more efficiently and effectively. Subject matter experts at colleges are able to train employees that have had additional work given to them by employers from downsizing.
Q. What type of education should companies focus on in today’s economy?
Technical training should be one of the focuses. Technology is continuing to grow and change, and the jobs are different now than in the past. Ten years ago, workers may have known everything there was to know about the equipment they worked on, but now, the equipment and the needs are constantly changing. Another area to focus on is green technology. Companies aren’t creating new green jobs but existing jobs are requiring more of a green component.
Q. How can a business form a successful training regimen?
For training to be successful, you have to train for it. Sit down and plan what you want to do. Do a needs assessment. Before a company pays for any type of training, the assessment needs to be performed and educators who will be performing the training need to show you a training plan. For example, if you need employees to take Spanish language training, you need to know at what level they need to start at and how the training is expected to improve employees’ comprehension.
As the national economy works to right itself, many business owners find themselves in the position of struggling to stay in business. With credit harder to come by, surely this isn’t the time to think about growing your business. Or is it?
“I think it’s more challenging, but any growth you achieve is ultimately going to be more sustainable,” says Chris Harless, senior business relationship manager at Wells Fargo Bank, N.A. “The key is to have a solid business plan.”
Smart Business talked to Harless about opportunities for business owners to expand their companies and the resources available to help make them successful.
What are the hurdles to growing business in the current environment?
The biggest challenge of growing the business in any capacity is whether you can handle the growth yourself. If you need to increase your inventory and add employees, how are you going to pay for it? Are your receivables getting stretched up to 60 days? Are your vendors asking for cash up front? If so, how will you pay for it? Will it put a huge demand on your cash? If you can handle that, then it’s a great time to grow, because your competitors may not be able to follow.
Being prepared and knowing your market are essential. If you can hit the price point and provide the service your customers and prospects need, it’s growth that you can sustain. If you get the business now, imagine how good things will be when the economy turns around.
What kinds of resources are available to help businesses grow?
Right now is the best time to work with your banker and financial advisers to make sure you have a good business plan in place, and evaluate the necessary resources to enact that plan. It doesn’t matter how hard you go at it, if your plan is flawed, or underfunded, then it’s not going to work.
Your business has multiple options for its different stages of growth. Some of the options include working capital lines of credit, real estate loans, equipment lines and loans, and U.S. Small Business Administration (SBA) guaranteed lines and loans. The American Recovery and Reinvestment Act (Stimulus Bill) has temporarily eliminated the SBA Guaranty Fee from its flagship 7(a) loan program. The Stimulus Bill also temporarily increases the guaranty percentage to 90 percent for loans up to $1.6 million.
This temporary reduction in the SBA Guaranty Fee is great news because it allows you to now save up to 2.5 percent of the loan amount in the payment of loan fees, take advantage of growth opportunities without depleting your capital, and keep your capital where it belongs in your business.
Overall, what role does the SBA play with small businesses?
Since Congress created the SBA in 1953, business owners have taken advantage of SBA guaranteed loan programs to meet their business financing needs to fund real estate purchases to house business operations, construction, renovation or lease-hold improvements, furniture, fixtures, machinery, inventory and working capital. The benefits of participating in the SBA loan programs typically include lower down payments, longer maturities and more flexible terms.
In addition to financing, the SBA provides small businesses with other quality programs, such as its Small Business Development Centers and SCORE program, that provide training, counseling, and other resources. Additionally, there are other agencies like the local economic development council, community development corporations (CDC) and local colleges that assist business owners in developing business plans and preparing them so that they can address issues they may encounter when attempting to gain financing from their bankers. These agencies and programs can also provide the small business owners with a strong foundation upon which to grow their business.
What else should a potential business owner do before starting a new business?
You have to do your research so that you understand the market completely. You may have a great idea but if it’s just a tiny niche in a big market then you really have to understand if there will be sufficient demand for your product or service.
You have to be adequately capitalized. Too many times we see people with a good idea and they start working without proper funding in place, and when they realize they need more money, it’s too late. It’s difficult to get financing once you’ve started because you are not in a position to pay that money back. A solid plan will ensure that your business is structured properly and you have sufficient working capital in place.
Does the size of the business influence whether the business will be able to grow?
Growth is not based on size; it’s based on management. Some of the companies that you see failing right now had a faulty plan. It may have been a good plan at one time but as the current recession began, management didn’t change their plan or pay attention to the market. So if the business plan is faulty the business won’t grow, regardless of the size.
Part of effective management is surrounding yourself with a strong team. A proactive adviser will identify products and services to help you grow your business. This will allow you additional time to seek future growth opportunities.
Chris Harless is a senior business relationship manager at Wells Fargo Bank, N.A. Reach him at email@example.com or (281) 290-6086.
Right now, there are great opportunities to be had in the office real estate market if you know what you’re doing and where to look.
But just because it’s a strong buyer’s market doesn’t mean that you can land a good deal with little to no work. As J.W. “Jay” Wall III, a senior vice president with Moody Rambin Interests, says, you’ve got to plan the work and work the plan to get a great office lease.
“Even with the current tenant-friendly environment, there will be winners and losers, and winning is much more fun and profitable,” says Wall.
To get the best results, Wall recommends that businesses perform an existing cost analysis, develop a transaction schedule and formalize a negotiating strategy.
Smart Business spoke with Wall about the factors a business needs to consider in office real estate transactions.
What are the first steps a business should take to land a quality office lease?
First and foremost, look at the existing cost analysis. Review the current lease for problems and opportunities, measure the efficiency of the current space and assess the applicable market conditions. This exercise essentially creates the road map for the project.
Another important thing to look at is transaction schedule. If there is one fatal flaw in office space transactions, it is not allowing adequate time to complete the process. Obviously, a build-to-suit office building will require more time than an as-is lease renewal, but even simple transactions will be considerably more successful if adequate time for negotiation, counteroffers, planning, pricing, permitting and construction is factored into the equation. The potential savings can be 25 percent to 40 percent or more.
Finally, conduct a thorough market analysis. Companies making decisions without market research run the risk of overpaying for their real estate. Unless you can demonstrate realistic relocation options and available terms, a landlord will never put his or her best deal on the table. The creation of ‘fear of loss’ is critical in any potential renewal scenario. If you are an educated consumer, you will be able to make better decisions. Not only that, prospective landlords will be better able to fully address your needs and your decision-making will be based on a rich framework of relevant information.
Why is developing a strong negotiating strategy so important?
Essentially, this is a game. And from your perspective, the landlord can be a daunting competitor. The landlord has a team of people with a fundamental goal of maximizing the return on the landlord’s assets. Therefore, you need to make sure your goals for quality and cost containment are achieved. An experienced tenant representative will help counterbalance the landlord’s professionals and will ensure that your goals are met.
A key factor in getting the best results is controlling and channeling the flow of information. Mishandling information often scuttles a potentially beneficial negotiation, costing you additional rent. Fundamentally, only those making decisions need to know the details, and they need to be careful. Loose lips don’t just sink ships; they also sink real estate transactions.
Also, the typical landlord lease is written to protect the building owner from any possible problems related to a proposed tenant and is obviously very one-sided. Thus, it is the responsibility of you, your broker and your attorney to make sure that the agreement tracks the terms sheet and has language amended to reflect a more fair perspective for you. This can be a tedious and somewhat expensive process, but it is absolutely necessary to get the best possible result.
How can you make sure an office space will meet all of your critical needs?
First, visit prospective spaces, tour the common areas, check out the view, see the amenities, meet the management and drive into the garage. Imagine how it would feel to be a tenant in the building.
Second, get an interior architect on board. The architect can help assess your requirements, fit you into different spaces and aid in the development of preliminary cost estimates, which provide valuable assistance in the negotiation process. Good space planning is more than having an interior decorator make the space look spiffy. An effective space plan will have a positive impact on operating and capital requirements, employee morale, productivity and public perception.
Once you have it narrowed down to a few different spaces, a financial analysis can be prepared comparing them on an apples-to-apples basis. This analysis will normalize financial factors that complicate the real estate decision-making process, such as varying lease terms, different amounts of free rent, add-on factors (the difference between usable and rentable areas), different operating expense stops or base years and different amounts of capital required for build-out and moving.
What’s the final step?
Before the final financial analysis has been run, there may be as many as three or more sets of offers/counteroffers exchanged. At this point, a terms sheet is prepared that will minimize the chances of any misunderstanding of what the salient points of the transaction are. A good broker is also a good ‘jailhouse’ lawyer as it relates to assisting your attorney with lease terms. Not to be forgotten is service after the sale, including assistance with value engineering regarding construction costs, the selection of move consultants, etc.
J.W. “JAY” WALL III is a senior vice president with Moody Rambin Interests. Reach him at firstname.lastname@example.org or (713) 773-5578.