State of Entrepreneurship: Business startups going strong in Tulsa
By John Stancavage
© 2015 BH Media Group Holdings, Inc.
A year ago, Amy Murray and Piper Kacere had big dreams and a fledgling business.
The two Tulsa women were the brains — and the recipes — behind Superfood Cafe, and they needed some cash, connections and good advice to get their health-food business healthier.
So they entered the TCC StartUp Cup, a competition sponsored by the nonprofit Lobeck Taylor Family Foundation. After going up against some tough competition, the business partners won the $30,000 first prize.
Today, Murray and Kacere operate the bustling Superfood Cafe at 1717 E. 17th St., a brick-and-mortar representation of their dreams come true.
“The best advice we got was, ‘Don’t take no for an answer.’ We took that to heart,” Murray and Kacere said in an email.
“We also loved the advice that (former Tulsa mayor) Kathy Taylor gave us, ‘Stop, pivot and redirect.’ We are both really hard workers and are dedicated to making our company successful.”
Looking, leaping
There likely are many Tulsans with ideas who just need a little push to make the leap into operating their own business. And, in a way, the slow local economy and oil industry slump are providing that gentle — and sometimes not-so-gentle — nudge.
“Right now, the downturn in the energy industry is causing people to look for other opportunities,” said Jessica Flint, director of The Forge, a small-business incubator at 125 W. Third St.
The oil and gas price slump is a two-edged sword in Tulsa, local observers say. On one side, it is limiting the profits that petroleum executives might otherwise be reinvesting in growing businesses. On the other side, the layoffs are causing some people to consider working for themselves.
“Even if you’re not employed by a corporation, there is work to be done and money to be made,” said Bob Marshall, a consultant with Tulsa SCORE, a group of veteran and retired executives who counsel and mentor entrepreneurs.
“You just have to mentally diversify. Don’t keep all your marbles in the same basket. Look around for other things you can do for a living.”
At the moment, the city is seeing a boom in software development, manufacturing, medical, aerospace, food, accounting and human resources consulting businesses, sources said.
When the local economy was stronger and oil was $100 a barrel, Marshall said, he would work with two or three clients a week. Recently, that number has jumped to five a week.
There are about 30 consultants in the local SCORE office. Marshall is a retired aerospace executive while some other volunteers are still working full or part time.
Marshall said he fields all sorts of business concepts.
“I’ve talked to everyone from a guy that was living under a bridge here who had an idea to professionals such as dentists and chiropractors,” he said. “Everybody has something else they can be good at. Sometimes it just has to be pointed out.”
In addition to one-on-one consulting, SCORE holds monthly meetings on starting a business. Volunteers go over writing a business plan, funding, legal issues and permits, marketing and other start-up basics.
SCORE volunteers often follow up with one-on-one coaching sessions. The group’s fees range from free to a nominal charge.
Startup cash
Having a great idea is the core of starting a business, and even the best concepts won’t go anywhere without funding.
When the oil business is booming, the local entrepreneurial market usually is awash with investors looking for potentially high-yield business opportunities.
“But when there’s uncertainty in the market, a lot of those private investors go to cash,” said Tom Bennett III, co-CEO of First Oklahoma Bank in Tulsa. “We’ve seen this a lot in the past 12 months. A lot of oil money is in bank certificates of deposit right now.”
Even so, Bennett said, there seems to be quite a bit of funding still available from other sources, including small-business loans. First Oklahoma is one of the state’s biggest SBA lenders.
“I think our loan volume will grow about 20 percent this year to about $50 million, and half of that will be small-business lending,” Bennett said.
First Oklahoma is a fairly recent entry into the banking sector in Tulsa, with a new headquarters in Jenks, a high-growth city.
Overall, First Oklahoma seems to recognize that, while there are some large oil and gas companies in Tulsa, it really is a small-business town. More than 90 percent of local employment is in smaller companies, according to the Tulsa Regional Chamber.
Tulsa’s leaders for the past decade or so have tried to plug into this entrepreneurial spirit. The recent challenges in the local economy, if anything, are reinforcing that trend, observers said.
School of hard knocks
“Struggles help produce new ideas,” said Elizabeth Frame Ellison, executive director of the Lobeck Taylor Family Foundation.
The foundation has been one of the most aggressive supporters of entrepreneurs in the area. A few of the efforts it is involved with include the TCC StartUp Cup, Cultivate918, The Mine and the forthcoming 36°N “base camp” for entrepreneurs.
The $30,000 that Murray and Kacere won for their Superfood Cafe idea in the 2014 TCC StartUp Cup just scratches the surface of investments made by the foundation.
A 2013 study showed that the family giving organization had invested $254,000 since the StartUp Cup began seven years ago. That money, in turn, has generated more than $11 million of follow-on investments and created 300 full-time jobs as well as more than 2,000 part-time and contract jobs with an average income of $48,847. The total economic impact of the competition thus far is more than $57 million, Lobeck Taylor figures indicate.
Lobeck Taylor also believes in the value of putting entrepreneurs together in a room.
“Small-business owners sometimes feel they are operating in isolation,” Frame Ellison said. “It’s good to get them together and see what comes out of those ‘collisions.’”
The TCC StartUp Cup, which usually finishes in November, is being shifted to 2016 this year so sponsors can make it bigger.
“We’re evaluating how the competition can evolve to better meet the needs of the entrepreneurial community in Tulsa,” Frame Ellison said. “We’re excited to expand the best parts of the competition while making it more accessible for a larger number of startups. We will announce the name change and plans for starting the new competition — opening January 2016 — at Global Entrepreneurship Week in November (16-22).”
In the meantime, small-business owners can investigate Cultivate918, a group that holds regular meetings to “bring together high-energy, fearless entrepreneurs.”
Mining for gold
Tulsans looking to help the city with an idea also can get a fellowship at The Mine. The nine-month program implements community impact and social innovation projects to challenge Tulsa’s top professional talent. Fellows work in teams of five.
Each project receives a $10,000 seed fund. Group members determine the most effective way to spend the money, which could include website construction, equipment purchasing, technology design or travel to see best practices.
The groups meet every other Thursday at The Forge.
The Forge itself has been busy. The facility is designed to provide low-cost furnished office space, equipment, Internet access, mentoring and connections to people with a promising business concept. The goal is to nurture and support the enterprise while it gets off the ground.
Right now, all of The Forge’s six offices are full, said Jessica Flint, director of The Forge. One company is getting ready to “graduate” from the program.
“The Forge is building a good track record of creating jobs for young people that pay well,” Flint said. “This also means Tulsa is retaining those individuals. This is what it was designed to do.”
The incubator was started five years ago by the chamber’s young professionals group. Since 2010, the group has helped more than 25 entrepreneurs and has been responsible for producing $2 million in goods and services, according to TYPros statistics.
Community effort
Barry Davis, managing general partner of Davis Tuttle Venture Partners, a local private investment group, said Tulsa is fortunate to have so much help available for entrepreneurs.
“I’m very encouraged,” said Davis, who has more than 40 years of business funding experience. “There are a lot of agencies doing good work here, trying to help small businesses evolve. Tulsa is in a wonderful position with the Lobeck Taylor and Kaiser foundations, i2e (a state nonprofit that helps tech firms grow), the Oklahoma Innovation Institute and others.”
Superfood Cafe co-CEOs Murray and Kacere said having a local business creation program made all the difference for them.
“One of the best things about winning the Startup Cup was the process it took,” they said in an email. “It made us hyper-focused on the operations, which led us to analyzing every aspect of our company. We can tell you the profit margin of every product in our store and where every dollar is being spent. We aren’t just running a business. We know and live our business.
“Right now is the best time to be an entrepreneur in Tulsa. There are so many resources available to help navigate you through the rigorous task of starting a company from the ground up.”
Flint agreed.
“I feel like we’re at the beginning of something big,” she said. “There are more exciting things to come.”
