Philadelphia (1114)

Historically, private business owners overestimate what their comprehensive general liability (CGL) policy covers, and therefore don’t buy the additional insurance they need.

According to the Chubb 2013 Private Company Risk Survey, 44 percent of private companies have experienced at least one claim in directors and officers (D&O), employment practices, fiduciary liability, employee fraud, workplace violence and cyber liability in the past three years. More than half of the executives interviewed mistakenly believed they had some form of coverage under their CGL policy.

As business owners run into a wide range of costly lawsuits, government fees, data theft, criminal activity and employment claims, they must deal with these disruptive issues, which tax their administrative capabilities and put a financial drain on the institution. Until a company experiences an event that isn’t covered by CGL, however, a business owner may not realize where the coverage gaps are.

“They are starting to understand that they have a problem but very few of them actually buy the extra insurance,” says James A. Misselwitz, CPCU, vice president at ECBM.

Smart Business spoke with Misselwitz about where CGL falls short and what to do about it.

What do private business owners need to know about CGL coverage?

CGL does:

  • Cover legal liability arising out of bodily injury and property damage, and also advertising injury and personal injury (libel and slander).
  • Defend the company from lawsuits rising out of their operations.
  • Defend against infringement on a trademark or copyright.
  • Defend and litigate publications that involve liable and slander.

However, it doesn’t protect against:

  • Wrongdoings of a director or officer of the company.
  • Employment-related lawsuits, such as retaliation, harassment or sexual bias.
  • The personal liabilities arising out of mismanagement of a pension or 401(k) plan.
  • Professional liability risk arising out of services rendered for a fee, such as charging for estimates and quotes.

With D&O liability, why would a privately owned company be affected?

It only takes a marriage, divorce and/or another generation to get involved for a company to become vulnerable. Let’s say a second-generation heir is going through a divorce that isn’t amiable. Now, their spouse may feel like they have a right to an asset that they think is being mismanaged.

Almost all CGL forms exclude cyber liability arising out of social networking and social media, even as defamation and copyright infringement lawsuits increase in this arena. With social media, nothing is as simple as it seems and the ramifications of doing something wrong can be devastating.

In addition, business owners may believe their required ERISA bond covers fiduciary liability. An ERISA bond only protects a retirement plan’s assets from theft. It doesn’t protect the personal assets of fiduciaries who are found in breach of duty, such as making poor investment decisions. For that, you need to buy fiduciary liability insurance.

What’s your advice for business owners who may not have enough coverage?

You need to examine the activities of your company closely, while comparing current insurance policies, so that large holes in coverage don’t crop up. Basically, business owners need to discuss with a knowledgeable insurance broker what risk they can effectively transfer to an insurance company.

But as business owners start becoming aware of areas where coverage is a concern, some still fail to pull the trigger on an up-to-date insurance program. Many think this kind of additional coverage is expensive. However, the marketplace has already responded with insurance companies forming management liability packages that combine risks and lower costs.

The other problem is that some insurance brokers are unable to have an in-depth discussion about these types of coverage. Interview your broker to assess your risks,
and whether or not those risks have been transferred. If you feel your broker is not knowledgeable, then it may be time to call another broker.

James A. Misselwitz, CPCU, is vice president at ECBM. Reach him at (888) 313-3226, ext. 1278 or

Insights Risk Management is brought to you by ECBM


The increased use of web-based cloud accounting applications has provided users many advantages related to efficiencies and cost savings but conversely it adds certain risk factors, says Roman Leshak, a director in Audit & Accounting at Kreischer Miller.

Smart Business spoke with Leshak about ways to reduce risks associated with accounting in the cloud.

How do accounting firms use the cloud?

Accounting applications utilized through cloud computing include bill management and payment, customer relationship management, document management, enterprise resource planning systems, financial statements preparation, payroll, sales and use tax, tax return preparation and work flow resources.

Advances in technology have helped expedite the use of cloud applications, as many companies are seeing significant cost savings compared to developing and maintaining these applications internally.

Cloud computing can be a very attractive option for saving costs; it also lends itself to quicker software implementation and updates, portability of data enabling remote access among multiple users and locations and significant reduction and possible elimination of capital outlays for hardware.      

What are the main risks involved with web-based accounting?

Despite the advantages of cloud computing, there are several risks that need to be considered and addressed prior to making the decision to move from the traditional accounting applications as information maintained within these applications is often confidential, or even entrepreneurial, and is very valuable to the user. These risks include security and data privacy, reliability and availability of the data and data processing, loss of integrity and overall data ownership and transfer of data.  

During the vendor selection process the user should verify that the service provider utilizes a data center and that the vendor has received an AICPA Service Organization Controls Report on those controls in place at the data center related to infrastructure, software, personnel, procedures and data. These reports are crucial to understanding the vendor’s oversight of the data management, internal controls and risk management and in verifying that the proper safeguards are in place. Some accounting firms provide assurance services related to cloud strategy, integration and migration and will assist with corporate governance issues, vendor selection and system integration.   

Security of the data transmitted and stored within the cloud is of the utmost importance as this data is no longer stored on local servers. Data should be encrypted during the transfer and storage stages and needs to be protected from access by other users that may be using the shared data center.  Availability of the data and the reliability of cloud applications are just as important as the security of the data. Vendors must limit unscheduled downtime of cloud applications in our global 24/7 business environment.

In addition, the number of applications that a company houses in the cloud environment increases the requirement for the bandwidth needed for uninterrupted access to that data. Companies have used secondary internet providers as a backup option as well as engaged services with both telephone and cable internet providers to ensure constant and reliable connectivity.  Risks related to the ownership and migration of data upon a change or termination in service providers also need to be considered.  It is important to discuss the data transfer procedures with potential vendors as well as exit costs and strategies.

What do businesses need to do before proceeding with accounting in the cloud?

The most important thing you can do as a protector of information is to understand the potential risks associated with accounting within the cloud environment. Users should consider establishing a process of mandatory contractual agreements with potential cloud application service providers and verification that the service provider has the proper controls in place to help mitigate these risks of accounting in the cloud environment.

Accounting in the cloud has many advantages, but considering the risks and protecting your data should be your focus when entering into this environment.

Roman Leshak is a director in Audit & Accounting at Kreischer Miller. Reach him at (215) 441-4600 or

Insights Accounting & Consulting is brought to you by Kreischer Miller


Thursday, 02 January 2014 18:36

Weighing in on health care reform: Philadelphia

Written by

The Patient Protection and Affordable Care Act, often called the Affordable Care Act represents some of the most far-reaching government overhaul of the U.S. healthcare system since 1965 when Medicare and Medicaid came into being. It will be phased in over time, but a number of changes have been delayed and won’t be in effect until 2015.

The act focuses on increasing the rate of health insurance coverage for American and reducing health care costs. Here’s what some area businesses have on their minds about health care reform as the time nears for the full impact of the ACA: 

Steve Wray
President and CEO
Cadient Group 

How is your company preparing for changes associated with health care reform? 

Because we are actively engaged in the healthcare vertical, Cadient Group has been diligently preparing for the changes of the Affordable Care Act

(ACA) for more than two years. We've studied options for plan design, surveyed employee preferences and utilization, and potential economic implication in order to evaluate our strategic options. It's given us a greater level of confidence in our preparedness for the inevitable changes currently taking place. 

Have to studied or instituted wellness programs to contain health care costs for your employees? 

While we have initiated a limited menu of wellness-related initiatives over the past two years, our 2014 benefits plan design includes a much more robust wellness component. Our focus for these programs is to raise employee awareness and engagement related to healthy behaviors, including exercise, nutrition and health condition management. 

What other things are you doing specifically to contain health care costs for your employees? 

A microcosm of our efforts to control employee health care costs has occurred: we have actively engaged our staff in the decisions around the design of our health care benefits for 2014. Because of this inclusive approach, Cadient Group employees recognize management's commitment to offering robust health benefits while attempting to keep employee contribution expenses under control. Fortunately, this participatory approach has allowed us to achieve those goals in face of increasing pressures perpetuated by health care reform. 

Do you foresee having employees pay a larger share of company-offered health care coverage? 

Health care benefits are a central component of the value of employment at Cadient Group. Admittedly, it is a constant balancing act to strive to provide a premium level of benefits, while sharing the cost of those benefits in an equitable manner with our employees. Because of our proactive strategic approach to benefit plan design, as well as valuable analysis provided by consultant partners, we have been successful in minimizing increases to employee contributions relative to the high-value nature of our benefits offering.

Dave Michelson
President and CEO
National Interstate

How is your company preparing for changes associated with health care reform? 

National Interstate typically reviews all our benefit programs on an annual basis. The enactment of health care reform has not materially changed that process; it has simply added another layer of compliance-related items that we must be mindful of.  Our primary goal of providing benefit programs to meet the needs of our employees and their families remains unchanged. 

Have to studied or instituted wellness programs to contain health care costs for your employees? 

Over the last several years, National Interstate has implemented a variety of wellness programs primarily in response to our employees including initiatives such as an onsite flu shot clinic, monthly newsletter, health fairs including screenings and wellness vendors, as well as lunch and learn speakers. There is no question employees have greater access to information and resources promoting healthy lifestyles than ever before. For an employer, it can often be difficult to quantify the results of individual employees reaching their health goal. It may simply mean that employee was able to attend a son or daughter’s soccer game. Those kinds of results are important in addition to focusing on healthcare cost containment. 

What other things are you doing specifically to contain health care costs for your employees? 

We believe educating employees about the plan they participate in is a key factor in containing health care costs. Most medical plans have discounts and incentives already built into the plan design, yet many times employees don’t fully utilize these features. We work in conjunction with our health care provider to disseminate information to employees so they can make informed health care decisions. 

Do you foresee having employees pay a larger share of company-offered health care coverage?

It is impossible to predict what the future holds in terms of health care costs. What we do know is if our employees collectively work as a team, we have the best chance of minimizing health care costs for our organization. While we make health care choices as individuals, the impact of those choices from a rate perspective is felt amongst the group participating in the plan.

Anthony McBride
Principal, human resources
Edward Jones

How is your company preparing for changes associated with health care reform? 

We have been making changes to eligibility and benefit levels as required by the regulations since the passage of the Affordable Care Act. We have made required modifications to our group medical plan to ensure that it meets the guidelines for 2014. We will continue to closely monitoring the regulations so that we are prepared to meet future requirements of the law.

Have you studied or instituted wellness programs to contain health care costs for your employees? 

We have had a wellness program in place for several years, and anticipate it will help contain cost increases in the future by motivating our plan members to be aware of and gradually improve their health over time.

Due to health care reform what other things are you doing specifically to contain health care costs for your employees? 

By 2009, we had moved to a consumer-driven health plan model. Our plan includes some pharmacy and medical treatment programs that help direct members to lower cost, higher quality sources of care. Soon we’ll introduce online cost/quality transparency tools to help raise awareness of the disparate cost spread that can exist even within an approved provider network. 

Do you foresee having employees pay a larger share of company-offered health care coverage? 

While we do not plan to shift a greater proportion of the cost to associates in 2014, the overall costs for health care continue to rise. In this regard, we have added a surcharge to cover spouses who have their own employer-based coverage available. We cannot speculate on what may happen in the future because the health care landscape is undergoing so much fluctuation.


It’s something every business owner fears — the phone rings or you get a letter or email from your bank. They don’t want you as a customer/borrower anymore. What do you do from that point?

The most important thing is not to panic, says Charles W. Ormsby, Jr., managing member at Semanoff Ormsby Greenberg & Torchia, LLC. The situation is often not as bad or bleak as the bank originally presents it.

“They make it seem awful, but it can actually turn out pretty well when it’s all done,” Ormsby says.

Smart Business spoke with Ormsby about how to handle this type of problem with your lender.

When might a business owner hear from the bank about a problem?

In many cases, the business owner has defaulted on his or her loan. Perhaps they haven’t made a payment or are in violation of financial covenants. But it could also be due to the internal machinations of the bank. Maybe they want to get out of lending to your particular industry. Let’s say a bank is skittish about chemical manufacturing. It might call you up and say, ‘Look, we have the right to discontinue this relationship and that’s what we’re doing.’

Other times, a bank may want to clean up its balance sheet. If the bank is trying to sell or merge, it could need to get certain loans off its books. In addition, a loan can be classified as troubled without a business owner’s knowledge. If you’re getting more attention than normal — more communication and requests for information — that’s a red flag they are concerned about something.

What is the first step after that initial phone call, email or letter?

Take a deep breath, and then immediately contact your attorney and your accountant, who are hopefully experienced in this area. Having advisers who are experienced in dealing with, and standing up to, banks will end up paying big dividends — but only if you follow their advice.

Where do business owners make mistakes when negotiating with the bank about a troubled loan?

Never sign or promise anything without your attorney and accountant being involved. The bank is going to demand things, and in the absence of somebody who is experienced at advising a borrower, the borrower or business owner may feel compelled to comply. They might try to get you to waive rights, contribute cash, provide additional collateral or give personal guarantees.  

You need to evaluate where the bank stands, in terms of the collateral they already have, including personal guarantees. Don’t just accept what the bank is dictating to you. You may have considerably more leverage than you originally thought. As the saying goes, ‘Whoever has the money has the power,’ and you, as the borrower, have the money. Keep in mind banks ultimately don’t want your business, they want their money.

For example, I recently had a client whose bank called his loan and told him he had to put $1 million cash into his business. However, by the end of the negotiations the bank ended up loaning a multiple of that million dollars to my client. One of the things people find remarkable in these situations is how often banks will advance more money to keep you afloat.

One of the great fears for the bank is that you’re going to sit at the negotiating table — and I’ve done this on occasion — and slide the keys across the table and say, ‘Why don’t you run the business now.’ That’s the last thing they want. More often than not, their best chance of recovering as much money as possible is for the business owner, who has the relationship with his or her customers, employees and vendors, to stay involved.

Banks very rarely will precipitously shut you down. They will shut you down, however, if they start to feel you’re being deceitful. Its not a great strategy to play hide the ball with your bank. You want to be very clear and upfront with them. Banks don’t like surprises. If you are forthright with them, and get strong, you’ll get a better result.

Charles W. Ormsby, Jr. is a managing member at Semanoff Ormsby Greenberg & Torchia, LLC. Reach him at (215) 887-0200 or

Insights Legal Affairs is brought to you by Semanoff Ormsby Greenberg & Torchia, LLC

Most business owners rely on their computer systems and technology to keep their companies humming. When technology stops working, the business stops working. Even a relatively “simple” problem or question could involve hours of troubleshooting, resulting in unplanned downtime and expenses.

Proper management of technology can not only minimize pesky tech issues that drag down productivity and drive up costs, it can maximize productivity and help a business grow. But the time and financial resources necessary to manage IT in-house are making outsourcing increasingly attractive and beneficial.

“Also known as a Managed Services Provider (MSP), an outside IT provider can take over the day-to-day management of your IT needs,” says Kevin Conmy, regional vice president of Business Services at Comcast Business. “A good provider can offer set-up, maintenance and proactive IT management, as well as troubleshooting for questions or problems whenever they arise.”

Smart Business spoke with Conmy about key questions to ask when choosing a MSP.

Do they understand your business and technology?

You want a provider who already works with businesses like yours — who knows the technology, software and hardware. Be specific about your set-up, and ask directly: Does the provider understand networked printing? Are they familiar with the programs you work with? Can they work with PCs, with Macs, with servers? What about mobile devices or combinations of printers, scanners and routers?

Can they support you remotely?

It may seem comforting to have a technician come to your office, but the convenience and speed of remote service and support is invaluable as it’s often faster and more efficient. For example, if you’re experiencing a problem and your provider can talk an employee through diagnostics, resets or other procedures on the spot, it often resolves issues without an in-person visit.

In other cases, a provider can use the Internet to access your systems and networks remotely, with permission, to reset routers, change network settings, scan systems for viruses and malware, or reinstall software and handle many other problems in far less time.

That said, there will be times when you need on-site support, such as when you’re setting up new equipment, resolving physical issues with networks or moving equipment. You need a provider who can deploy on-site technicians promptly, to any of your locations.

Do they work nights and weekends?

When do you most need service and help? If you are in retail, hospitality, transportation or any other industry where 9-to-5 doesn’t apply, you need a provider who is 24/7. Or, maybe the only time you can stop for service is outside of your working hours. A provider who is daylight-only may increase prices for after-hours and holiday support. They may provide limited services or slower response after regular business hours. That can hamper — and cost — you.

Do they offer preventive, proactive help?

It’s best to have a prior relationship with an IT provider. When your network crashes or computers go dark, that’s not the time to start hunting for help. You want a resource you know, and who knows you.

Second, ask what preventive services an IT provider has to help spot potential problems before something breaks. This can involve scanning your computers for rogue code, and troubleshooting and testing your network for performance issues.

How do they charge?

It may seem prudent to arrange for support on an a la carte basis, but when something breaks that practice can be unpredictable and costly. And it’s especially irritating when the problem could have been prevented.

A better option is an all-inclusive monthly subscription fee — either per user or for the entire business. This fee can include the immediate services that may be required, along with some combination of proactive and preventive services, data back up, hosting, etc. The costs are more predictable no matter what occurs, and it’s easier to predict the costs of adding more users, and computers. As your business grows, you need a solution that can scale with you.

Kevin Conmy is a regional vice president of Business Services at Comcast Business. Reach him at (215) 642-6457 or

Insights Telecommunications is brought to you by Comcast Business

E-risk. Data and network security. Cyber liability. There are as many names for insurance that covers privacy and Internet liability as there are insurance companies.

In general, “cyber” is a catchall phase referring to use of computers, the Internet, networks and electronic data, says Jan O’Rourke, CPCU, RPLU, ARM, assistant vice president and director of client services – specialty division at ECBM.

“I don’t know of any responsible business that would operate without standard insurance coverage — general liability, auto, workers’ compensation and property — to protect the business against financial loss, and possibly ruin,” O’Rourke says.

“With the evolution of computer usage, cyber exposures are growing rapidly. For many businesses, their chance of a loss occurring due to a ‘cyber’ type claim is greater than a loss covered by standard coverage,” she says. “Yet many executives don’t seem concerned about the risk, and still don’t think they need cyber coverage.”

Smart Business spoke with O’Rourke about cyber risks and how insurance has become necessary to cover this exposure.

Do general liability policies provide any kind of cyber coverage?

Years ago, some cyber coverage could be found under the general liability and property policies. Those days are gone. Most insurance companies have added specific exclusions to eliminate any chance of coverage for cyber claims. The exclusions wipe away any doubt about coverage.

Who and what is at risk?

Any business that uses computers, stores personally identifiable data (even if only for employees), communicates electronically and maintains a website or social sites, among other functions, has a risk exposure.

Risks include third-party liability arising from failing to safeguard confidential private information of others, damage to another party’s computer network, infringement or personal-injury-type offenses communicated electronically, regulatory fines and penalties — such as payment card industry compliance, HIPPA and other federal and state regulations — and the cost to defend any of these allegations.

Also, a company that has a cyber attack faces first-party losses, such as the costs to notify persons affected by a privacy breach, including notification, credit monitoring and other services; crisis management event expenses; the cost to restore the computer system and network; and the loss of money, securities or other property from the computer fraud or fraudulent funds transfers. Additional expenses could come from e-commerce extortion, the loss of income due to computer systems not operating, and the costs for experts, forensic, legal or others needed after a breach or other incident occurs.

A 2012 cost study of 137 cyber breaches by NetDiligence found that an average breach cost $3.7 million, ranging from $2,000 to $76 million. The average cost per record was $3.94, with an average of 1.4 million records exposed in a breach.

How can companies benefit from cyber coverage?

One of the most important benefits is not payment of the loss; it is access to the insurance company’s expertise, including assistance after a loss occurs. The carrier knows the laws in each state regarding how notification must be handled, such as whom to notify and in what time frame. It has access to cost-effective legal, forensic and other specialists.

The insurance company also offers access to specialized websites that provide tools, tips and resources to prevent a cyber loss in the first place. Just reading the questions while filling out the application for this insurance provides food for thought.

It’s important to note that the only standard thing about the insurance market for cyber coverage is the fact that every insurer offers a completely different product. Cyber insurance premiums vary more than any other insurance line — as low as a few hundred dollars for the most basic extension to a policy, up to more than several hundred thousand dollars for the largest companies in high-hazard industries, such as health care, education and financial institutions.

You’ll need to utilize the expertise of your risk manager and/or insurance broker to analyze your specific business exposures and recommend the appropriate, broadest coverage for you.

Jan O’Rourke, CPCU, RPLU, ARM, is an assistant vice president and director of client services – specialty division, at ECBM. Reach her at (610) 664-8299, ext. 1210, or

Insights Risk Management is brought to you by ECBM

By definition, the term “waste” is an act or instance of performing or spending carelessly, extravagantly or to no purpose. Despite the negative connotations surrounding waste, many businesses are seeing waste as an opportunity.

Successful businesses are actively engaged in the identification and reduction of waste in processes, says Robert S. Olszewski, a director at Kreischer Miller.

“Processes either add value or create waste to the production of a product or service,” says Olszewski. “Waste can account for up to 30 percent of the operating costs of an organization. Unfortunately, waste has become accepted by many as what normally happens. Most businesses put significant energy into increasing sales. However, pushing more business through an inefficient system makes no sense.”

Smart Business spoke with Olszewski about the process and enhancing the probability of reducing waste.

Are there common areas of waste in a business?

Waste reduction is one of the most effective ways to increase profitability in businesses. Prior to jumping into the issue identification process, it is important to comprehend what waste is and where it can be found. Toyota, after years of work to remove waste, identified the most prominent ones. The seven most common wastes identified by Toyota include overproduction, waiting, transporting, inappropriate processing, unnecessary inventory, motion and defects.

As we facilitate activities surrounding the waste reduction process, we often find that the key areas of waste are clear to all levels within the organizational structure. The elephant in the room needs to be addressed.

Is there a process businesses can use to reduce waste?

Conducting a waste assessment is the starting point, which generates a wide range of issues. With so many issues requiring attention, the project can be overwhelming. Therefore, ranking priorities enables the most important issues to be dealt with first; focus on the issues that have the greatest combination of economic benefit and ease of correction.

Start with the end in mind by establishing mutually agreed upon key performance indicators to monitor the effectiveness of the change being implemented or the impact of issues being addressed.

Who should be involved in waste reduction?

Waste reduction is not a task for a single individual; formation of teams is essential. Teams are not spontaneously generated, they require lots of hard work. It is unrealistic to believe your team will network and instantly reach peak performance.

Teams go through four distinct stages: honeymoon period, power struggle, working through frustrations and settling into a high performance mode. Don’t worry when the team enters into a power struggle, as conflict is normal; don’t take it personally. Change should be welcomed and the probability of success may be enhanced with an independent third party facilitator.

What are the most common issues you have observed in the process?

First is overcomplicating the process. We recommend isolating the significant few from the trivial many. You must be laser-focused on the issue and define where you are now, where you want to be, and form strategies on how you are going to get there. Do not get overly excited about where you are now and begin attempting to correct it. Be certain to define where you want to be in order to define and enjoy the success.

Second is accountability for results. Construct a one-page plan that highlights key action items, responsible parties and timelines. In addition, we recommend performing routine assessments for accomplishing mutually agreed upon goals and expectations.

Robert S. Olszewski is a director at Kreischer Miller. Reach him at (215) 441-4600, ext. 275, or

Insights Accounting & Consulting is brought to you by Kreischer Miller

Seth Priebatsch is one name that David Bookspan won’t soon forget. Priebatsch is the founder and CEO of LevelUp, an alternative payment service business where consumers can go to merchants and charge their purchases through a QR code.

“LevelUp is in a lot of different cities now and they are just killing it,” Bookspan says. “Seth is a force of nature. He was a 17-year-old freshman at Princeton when he came into DreamIt. He was full of energy, scary smart and just a rock star. He needed some additional business support and we connected him.”

DreamIt Ventures is a seed-stage accelerator and startup fund. Plans were announced on Dec. 11 to open DreamIt’s new world headquarters at the University City Science Center, one of the oldest and largest urban research parks in the United States. It will be part of a new Innovation Center jointly established by UCSC and Drexel University.

Drexel is committing $3 million to DreamIt Fund II, a $30 million fund to invest in startup companies participating in the accelerator program.

“One of the objectives that Drexel has is to create an innovation neighborhood in west Philadelphia and they saw DreamIt as an opportunity to anchor that neighborhood,” says Bookspan, the founder and managing partner of DreamIt Ventures.

Since its inception, DreamIt has launched a total of 127 companies, including 74 in Philadelphia.

Priebatsch is one of the entrepreneurs who got his start with the accelerator. So are Jack Groetzinger and Russell D’Souza, founders of Seat Geek.

“Seat Geek is the largest ticket service for event ticketing,” Bookspan says. “It can show you what are the best deals, and it does it through an algorithm they have developed that judges everything from the specific setup in the arena to the demand for tickets. They also use predictive analytics to tell you whether you should buy now or wait.”

Plant the seeds

There are some misconceptions even within the business community about the difference between an accelerator and an incubator.

“It’s important for fledgling companies to have office space where they can work and incubators can provide that and also provide support services for those companies,” Bookspan says. “But accelerators are much more about finding out in a short period of time whether the business has potential and can succeed. An accelerator is for a very short defined period of time. The companies either fly or die.”

In the case of LevelUp and Seat Geek, neither company had a problem taking flight.

“A lot of early-stage companies hit a valley of death where it’s difficult for them to raise the next round of funding,” Bookspan says. “The DreamIt fund provides that source of capital as well as an extraordinary return profile for the investors in the fund.”

A tough economy is often a motivator for would-be entrepreneurs to take a go at launching their dreams.

“Since big business is not providing as many opportunities or careers during down economic times, very talented people are much more willing to pursue their own dreams,” Bookspan says.

The biggest challenge Bookspan faces is keeping up with the demand for supporting startups in new cities.

“Philadelphia is emerging as a fantastic startup community,” Bookspan says. “Companies locate themselves where there is a confluence of four different aspects: capital, talent, customers and lifestyle. Philadelphia is now making big strides to have the convergence of capital and talent. There are also a large number of businesses that can be early customers for these companies in Philadelphia and certainly in the Northeast.”

How to reach: DreamIt Ventures, (212) 564-3665 or

As a cornerstone of the communities they serve, today’s libraries have evolved beyond just providing books to their patrons: they now offer group meeting sites, public Internet access, research information, digital content and so much more. 

Yet despite the greater number of amenities that can be found within their doors, libraries are finding that their budgets are continuing to tighten. This leaves many libraries and library systems increasingly saddled with the task of offering new services — and the technology necessary to deliver them — while still adhering to limited funding sources.

The Cumberland County Library System is the busiest library system in the state, receiving more than 1,200 online customer requests per day and circulating more than 2.2 million items annually. In 2012 alone, more than 1.2 million people visited the actual library facilities themselves, and the system’s online card catalog continues to be visited roughly 3 million times each year.

Consisting of eight library locations and a system headquarters office, CCLS provides services to more than 244,700 residents across Cumberland County and parts of Franklin County in eastern Pennsylvania.

With such high traffic on its network, the CCLS is quite dependent on its Internet connectivity.  Beyond the everyday activities that require reliable Web access, the library also provides online access within its physical locations to its print and audio catalog, membership portal and eResource download center — as well as various types of productivity software like Microsoft Office — to patrons who may not have access to these tools from their homes.

Addressing a problem

Internet connectivity became an issue recently when CCLS began to receive complaints from patrons who were increasingly frustrated with how long it would take for them to access these resources while visiting the library itself. 

“One of our patrons remarked that by the time he was able to finally access the software he was trying to use at our resource center, it was useless to him because he had already given up and found the information he needed through a different method,” said Jonelle Prether Darr, executive director of the Cumberland County Library System.

“He wasn’t alone. Many of our patrons were increasingly frustrated by the slow Internet speeds when using our library computers to upload or download documents for job searches, online classes or when communicating with distant relatives.”

This frustration was also evident with library staff. Many of them were forced to drive to library headquarters in Carlisle, Pa., to attend internal training sessions in order to avoid needing to use the painfully slow Internet connection.

Library staff attempted to participate in online training sessions that were designed to make everyone’s life easier, but it only served to overcomplicate things.

The video feed was choppy, the audio was intermittent and in the end, staff members would find they had wasted an hour with nothing to show for it. Driving to headquarters was the only solution, but it came at a cost. There was the obvious cost of fuel and mileage, but the trips would also take staff away from their desks at the libraries and away from supporting patrons.

A growing trend

CCLS knew that the time had come to upgrade its network, not just to deliver the best possible experience for its patrons using on-site computers, but also for its employees. The solution was high-speed Ethernet.

The CCLS is using 10 Ethernet Network Service connections that range from 100 megabits-per-second (Mbps) to 1 gigabit-per-second (Gbps) of speed. This links all locations, as well as library headquarters, to the nearby county courthouse. The CCLS also has a 100 Mbps Ethernet dedicated Internet line that is improving Internet connectivity at its more than 300 on-site branch computers.

With speeds up to 33 times faster than a standard T1 line, experts estimate that Ethernet customers can download a 2GB file in approximately four minutes, which would otherwise take T1s more than 2½ hours.

“One of the main advantages is its ability to reliably connect organizations to both their data and their employees — whether they happen to be sitting next to each other, down the street or across the state,” says Glenn Lytle, vice president of Comcast Business in the Keystone Region.

CCLS reached out to Comcast and opted to install 10 Ethernet lines that would link all of its locations to each other, as well as connect its library headquarters in Carlisle to the nearby county courthouse. The goal was to increase the Internet speeds of all computers within each location, as well as improve the existing video conferencing system that had previously caused issues for library staff — without costing an arm and a leg.

The move paid instant dividends. As of November, CCLS had already saved 30 percent in costs from switching to Ethernet — and with more services planned over the coming months, Darr expects that number to increase.

“What this process has shown us, more than anything else, is that when there is no problem, nobody complains — and that is, quite frankly, exactly what we’re striving for at the end of the day,” Darr says. “And, of course, the fact that we’ve already seen a cost savings for the latter half of this year alone understandably makes us even happier.”

CCLS seems to be just one of a number of local organizations that have embraced Ethernet.  Local companies in a diverse range of other industries — like Hanover, Pa.-based Utz Quality Foods, which recently installed Ethernet to connect a number of its locations scattered across the eastern part of the country — have started using this technology as a cost-effective, more reliable alternative to the service typically provided by the telephone company. 

For Somerset, Pa.-based PBS Coals, the fourth-largest coal producer in Pennsylvania, nearly all of the organization’s day-to-day business activities are dependent on 3D maps — which can be up to 3 gigabytes in size and must be constantly updated using AutoCAD software to reflect the most accurate information on miner locations, drilling depths and safety hazards. PBS opted to install Ethernet to expedite the transfer of these critical files to help ensure the safety of its 650 employees in multiple locations across Somerset County. 

And Canonsburg, Pa.-based Sarris Candies recently experienced the benefits of Ethernet firsthand when its Internet connection remained intact even after a fire broke out at the iconic candy store’s main headquarters. 

Although the fire destroyed approximately a third of the company’s inventory, including more than 50,000 pounds of chocolate, seasonal candy molds and equipment right before Valentine’s Day and Easter, Sarris Candies remained connected to the Internet the entire time. 

“We had smoke coming out of our windows and the fire department at our door, but our delivery trucks continued to run since we were still able to process our orders,” says Norm Candelore, retail operations manager for Sarris Candies. 

“When the smoke had cleared, all of our internal cabling was destroyed, and our IT folks needed to rewire the entire store — but the actual service coming into our building remained uninterrupted, and all we had to do was take our laptops and relocate down the block to the warehouse in order to continue operating as normal.”

The move toward Ethernet is only gaining steam. Leading industry analyst firms like Vertical Systems Group reported that worldwide demand for business Ethernet services will reach $45.1 billion by 2016. It’s now up to other local businesses to determine whether this technology is right for them.

How to reach: Cumberland County Library System, (888) 697-0371 or