Getting a business past its plateau

2018 Mini-MBA graduates — Program Director Dominique Scott, seated. Courtesy of Meda

 

Meda’s Mini-MBA program offers help through the second stage of growth

Black business ownership is experiencing major growth. According to the Minority 2018 Small Business Trends survey, the number of Black-owned small businesses in the U.S. has increased by 400 from 2017 to 2018. And, in Minnesota, businesses owned by people of color are the fastest growing demographic, reports a 2017 survey by the Aspen Institute in Washington, D.C.

While this may sound like great news, many of these new businesses face multiple obstacles in getting and keeping their doors open. The Metropolitan Economic Development Association (Meda) was founded to help these existing – and future – entrepreneurs achieve success by providing financial services, business consulting, and market opportunities.

The organization began in 1971 with Twin Cities business leaders who believed that one option for people of color to move out of economic hardship was to own a business.

Recently, Meda did an analysis on the current minority business ecosystem, evaluating every stage of products and services in the business cycle. It reported “a very fragmented system of access,” said CEO and President Gary Cunningham.

The organization found that if businesses didn’t have support, they stumbled when they reached the second stage of business growth. “[They] have used up all of their ideas and don’t know where to go; they plateau, or they go out of business,” Cunningham told the MSR.

Lili Hall, president of Knock Creative Design, a Meda board member, and the 2016 “Employer of the Year,” lamented that “We live in a culture where there’s expectation that every business owner knows exactly what they’re doing.”

One answer to the problem could be Meda’s newly developed Mini-MBA program, which uses peer-based learning to help entrepreneurs identify and avoid stumbling so they can move to the next level. The program also teaches entrepreneurs how to develop a three-year growth plan to transform their leadership thinking. This July, it graduated its first cohort of 20 entrepreneurs – including eight Black-owned businesses – from the seven-month program.

To maximize its impact, Meda brought in Boston-based Interise to help program participants reach the second and third levels of their business cycle. Cunningham and Scott were impressed with Interise’s success, having served over 5,000 small businesses in 70 programs around the country.

“One hundred percent of [Interise’s] alumni businesses have reported being profitable with $655 million in government contracts,” noted Program Director Dominique Scott. She said those numbers coincided with Meda’s inaugural program and its first cohort.

“My expectations for the program were to really enhance my business knowledge in moving our funeral home forward and into the future,” said Tracy Wesley, CEO of Estes Funeral Chapel and a graduating member. “The program wasn’t easy. It really made me work to be able to try to understand the inner workings of what it takes to run a business.”

“They [went] from just thinking operational to thinking…in a broader scale of how to grow the business strategically,” said Scott.

Scott added that being in the program has motivated the graduates to make some “drastic changes in their business.” They have fired employees and hired managers to assume some of the entrepreneur’s responsibilities, she said. It has allowed them to spend more time on the program’s strategic planning process.

“They have taken the program very seriously and have seen the progress throughout the business and within themselves,” said Scott.

In addition, said Cunningham, the collaboration has helped businesses move past the plateau mark and accelerate their revenue by about 43 percent.

Gary Cunningham Courtesy of Meda

Applying to the program

Meda is currently accepting applications for its second Mini-MBA cohort. To qualify, prospective participants must be part of a minority-owned business that is at least three years old and with at least one employee.

Eligible applicants must apply online. There is a $1,000 fee, of which $500 is returned when the applicant graduates from the program. Once the application is submitted and reviewed, Scott contacts the business owner to ensure all the details are included.

Even if it appears the application won’t qualify, she makes it a point to follow up with a phone call to offer support and answer questions. “I always call to correct and make sure their answers are accurate.”

Her next step is a site visit to get a “good feel for the business.” Scott meets the employees and some customers. She will also interview the owner to learn about their leadership style and business goals.

If the applicant qualifies, she or he will have a one-on-one interview with each of five panelists. In the past, the panelists were David Edgerton, from the University’s Carlson School of Management; Meda employees; and business and lending consultants. Scott plans to include an alumnus from the program’s first cohort, as well.

Scott notes while applications to the program are increasing, the application process is extensive. “I made it that way because I wanted to make sure I was getting some quality candidates.”

An important path to success is for the applicant to be fully committed to the program, she said. “They have to have that mindset of ‘I know I need to change something in the way that I’m running my business and how I think of myself as a CEO. I need help in knowing the fundamentals of running a business.’”

Cunningham underscored the socio-economic value of business ownership: “If Black people are going to move out of being asset poor and being the ones that are in poverty, we have to build our own businesses and build our own structures to change those conditions.”

He emphasized that the gateway to economic stability doesn’t necessarily have to always be government programs or a social welfare kind of situation. “It has to be us building our own businesses,” Cunningham explained.

“So I say, if you’re African American and you don’t have a business, get one.”

 

Mini-MBA information sessions will be Tuesday, September 18, 6 – 7:30 pm and Saturday, October 13, 10:30 am – 12 noon.

For information about Meda or its upcoming Mini-MBA information sessions, go to Meda.net.