← Culturally Speaking: The South Florida Sunday Podcast
Culturally Speaking: The South Florida Sunday Podcast
Patrick Franklin, President and CEO, Urban League of Palm Beach County + Pamela Stewart, President of Palm Beach County Black Business Investment Corporation
00:29:58
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- [00:01]
A
Good morning and welcome to another edition of Culturally Speaking. My name is Patrick Franklin, president and CEO of the Urban League of Palm Beach County. And I thank you for waking up with us early this morning and joining us as the sun is rising and you starting off your Sunday. And I thank you for tuning in to Culturally Speaking. And as always, we have a special guest, a return guest, who. Who's gonna help us talk about black business. Small black business. And I'm talking about the one and only Pamela Stewart, president of the Palm beach county bbic. Pam, welcome back.
- [00:36]
B
Thank you, Patrick. Glad to be here, Pam.
- [00:39]
A
Now, for those who don't know you, that's only a handful. I know, but tell us a little bit about who you are and your background, and then we can dive into bbic.
- [00:49]
B
Okay, great. Well, Patrick, I've been involved with economic development here in Palm beach county now for close to 30 years. I think I just dated myself.
- [01:00]
A
No, that's a good number.
- [01:03]
B
Yeah. So I've worked in various capacities in different aspects of just helping small businesses. Right now. I've landed at the Palm Beach County Black Business Investment Corporation as the president and CEO. We also have another organization that I run called Pathway Capital Funding, and we have recently rebranded. We're now known as Inclusify cdfi, which. Which indicates inclusive finance for small businesses.
- [01:31]
A
All right, so listen again. Inclusify
- [01:35]
B
cdfi.
- [01:36]
A
Cdfi. Okay. Very good. Very good. New name. Love it.
- [01:42]
B
So, yeah, so it's a new brand for us, but we're still doing the same things that we've always done to support small business. We've implemented some new programs, some new loans, products. And so I'll be happy to discuss those.
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A
Let's give a little bit of educational background on what a CDFI is.
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B
A CDFI is a community development financing institution that is certified by the U.S. department of Treasury. We exist because, as you know, some groups and certain types of small businesses cannot get funding from traditional banks. So we exist to fill the gap.
- [02:21]
A
And your typical loan size is for inclusivey?
- [02:26]
B
Our typical loan size is 250,000. However, as a CDFI, it's not just about us getting the deal. It's also about just connecting the entrepreneur with funding. Last year, we were able to assist a small business owner with getting a $3 million loan. And recently, we participated in an $8.7 million deal.
- [02:46]
A
I know that my counterpart in Broward, the Broward Urban League there, is cdfi, and I knew it was really tough to get that certification, get that accreditation, and I applaud you guys. For doing that. How many other CDFIs are in our immediate area?
- [03:01]
B
Well, in the immediate area I would venture to guess that there are probably about 15 CDFIs. We're the only one in Palm beach county in the Treasure Coast. But you know, the further south that you get, you know there are more CDFIs and I think it's about 15. But not all of them are small business CDFIs. Some of them do housing, some of them are doing things such as solar energy funding, but there are about that many.
- [03:30]
A
Do you make those micro loans, those loans, let's say for $1,000, $5,000. Is that something that somebody was interested in? Something like that? Would they come through bbic?
- [03:41]
B
Well, we don't do consumer loans. We only do small business. So you have to actually have a business that exists in order for us to do the. However, we have just recently developed a product called the Express Loan that requires a lot less documentation and that one starts at 2,500 up to 12,500. So we're doing what we can to meet the demand no matter what size it is.
- [04:04]
A
And who particularly are you looking at to service? Is that looking for a small single owner business or two or three people or someone with income revenue of less than $500,000? I mean, well, where does it go from there?
- [04:23]
B
I will tell you that we're open to any business that is unable to get funding through traditional means. And that could be a business owner that has a low credit score even though they're making millions of dollars. It could be a business owner who is new. We do fund startups and we have some technical assistance and training programs to support startups as well as existing businesses. So for us it could be industry related. There are certain industries that restaurants aren't really, I'm sorry that banks aren't that willing to do like restaurants I just mentioned. So it just really depends. And then even if you're in the construction related trades and you're a general contractor, it's very hard to get funding for those types of businesses as well.
- [05:08]
A
Or if you're self employed with the small shop, you.
- [05:12]
B
Yeah, we do self employed solopreneurs like you mentioned earlier. But our typical clientele probably has five employees or less and they earn half a million or less. But you know, we don't limit it. Like I said, it just really depends on what the need is.
- [05:29]
A
If you just join us. Thank you for joining us this morning on culturally speaking, I have with me Pam Stewart who's the president CEO of the Palm beach county bbic. Pam, what if I was. If I was a person thinking about creating a business, would you be one of the first calls I make?
- [05:51]
B
Well, I could be one of the first calls that you make. We actually have a program now called Startup U. It's a really neat program because what it does is it actually walks the business owner through what it takes to legitimately start up your business. There are a lot of business owners out there that have been operating, but they just have not gone through getting the proper documentation. That program's kind of unique because not only does it help you with how to start right, it also assists the small business owner with how to eventually qualify for funding. So we couple that one day workshop with business planning class. We also do a credit class because unfortunately it's like one of the major elements that prevent a lot of small business owners from accessing funding. And then we also will provide a Kickstarter Grant of $500 if you complete all the elements of that particular program just to get you started correctly. Now, in addition to what we offer, we also work with a variety of business partners who are able to provide technical assistance. So just to give you an example, we work with Operation Hope and they give deeper levels of technical assistance and come up with an action plan just really tailored around that client. So we like to hand off a client that might need deeper levels of technical assistance to an organization like that and they refer them back to us when they're ready to actually get funding. We also work with the Service Corps, Retired Engineers Score and the Small Business Development Center. And then we also work with organizations like Prospera who typically work with Hispanic clients. So for us, it's about giving them access to resources so that they can get a solid foundation, get a great start, and really be sustainable businesses.
- [07:36]
A
Pam, how does someone get in touch with you when they're looking for that assistance?
- [07:42]
B
Great question. I love it. The best way to get in touch with us is to go to our website, which is inclusified.org that's inclusifi.org and you'll see a button that says get started. Just click that button and we can set you up for one on one counseling. You can learn about our training classes or you can learn about our funding programs.
- [08:06]
A
Very good. You know, one of the biggest myths that I've seen over the years at the Urban League is when someone has a small business that they're starting that they're working in, how do you separate your personal business account from your work account? Because that Sometimes is the depth of that business.
- [08:28]
B
It really takes discipline, Patrick. But it's so important. You know, we had a event with the city of West Palm beach, since this is Small Business Business Week. Thank you for inviting me doing Small Business Week.
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A
Very good.
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B
But one of the things that came up is that it really shows. It gives a clear indication of what your actual business expenses are versus your personal expenses. And we can't assess what your business expenses are when they're commingled like that. And it really just does not show discipline. The other thing that came up is that, you know, when you set up a corporation or an llc, you get what's called a corporate veil that protects you personally from some of the liabilities of the organization. But when you start commingling like that, you actually.
- [09:15]
A
There's no separation when you start coming, but you have to have that separation
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B
actually pierce that corporate protection that's there for you. So it's really important that you do that.
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A
When let's kind of. Kind of go into the age of. I know people say, well, I don't have a brand new business. I've been doing this for a year, two years, three years. What are some of those pitfalls, Pam, in your vast experience, that our early small businesses have fallen into because they just didn't know?
- [09:46]
B
Okay, that's an excellent question. Because typically when they come to us, sometimes it's too late. So I will tell you that the best thing is to have your financial house in order. I can't stress that enough. I had an entrepreneur that came into me about three weeks ago, and he's been in business for seven or eight years. And not only does he operate a very successful business, he also has some ancillary businesses that he's operating very successfully. But his accounting team did not grow with him. So as he started out, you know, they were fine. But once your operation gets more sophisticated, you gotta make sure that you have the resources in place that can grow with you. And if you don't have that, then you need to move on. And so not only was I able to talk to him about the importance of maybe it's time for you to get a cpa, also get yourself a bookkeeper. Don't try to do it yourself, because your power is with the product that you're producing. It's not with doing the back of house. And it's not as expensive as you think it is. The other thing is that I see all the time, Patrick, is that we have business owners that have been in business for a While they're masters at their craft. But what they do is they get with a accounting professional that is there that has been tasked with saving them on their taxes. One of the mistakes that black and brown businesses make is that we do not understand that you cannot qualify for funding if you can't show that you can support the loan. And if you take all the deductions, just know it's a double edged sword. So you're either going to be a business that saves on taxes or you're going to be a business that is postured to grow. And we want our businesses to grow and be successful and flourish.
- [11:33]
A
Pam One of the pitfalls that I recognize and was akin to after Hurricane Katrina. Many of the small businesses that were located in Louisiana and around the areas when FEMA came into town to support them, they were majority cash businesses and, and they had no records to justify that they made a million dollars last year even though, even though they did. But they only had receipts and business documentation for 100,000.
- [12:07]
B
Patrick, we see it all the time and I even have entrepreneurs that say to me, well, do you want me to tell you how much I really make or how much I tell Uncle Sam that I make? Even if you're in a cash based business, it is so important that you actually make those deposits and show how robust your organization is. Because when it comes to things like FEMA or Covid, even with COVID We had Covid, exactly.
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A
Yes.
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B
We could not access the resources that were there. Not to the tune that what we deserve because we were under reporting. And it may save you on taxes, but when it comes time for you to grow, scale, access resources, if you don't report what you're actually doing, then you're gonna be hampered.
- [12:48]
A
Folks, listen to this because I've seen too many small businesses. I mentioned Hurricane Katrina, the aftermath of that Covid was what was another thing that in order for you to get relief you had to show the value of your company. And if you do on cash basis and taking it under the table and doing all this not reporting, yes, you may feel good now, but when it comes to really get back what you deserve, absolutely. You can't. There's no justification for it.
- [13:17]
B
Absolutely. Another thing that I'm seeing, Patrick, that I just want to put out there is these quick loans. You know, hey, based on what you're doing, I can get you a loan in 10 days. You know, be very careful because what happens is that it may sound good but it's very predatory. So I'm working with A doctor right now who got a loan and it wasn't a large loan, $25,000.
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A
Are you born against future earnings?
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B
It's based on future earnings and based on what she showed, they are billing her $150 a day. That doesn't sound like a lot, but once you add that up, that's like $3,000 a month.
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A
what interest rate? Some ungodly rate.
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B
Ungodly because they do it just based on a daily cash amount. And I could have done the same loan and saved her so much money because you know we have a fixed monthly payment every month.
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A
Right.
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B
And when you go out there and get it fast and quick, trust me,
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A
every loan is not the same.
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B
It is absolutely not the same.
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A
The quicker, fast, fast paced loans are there for a reason and they're getting paid not only what you think you're paying back, but even more.
- [14:26]
B
And then you can't get out of the loan either. So whether you pay them off the next day or not, they're gonna get the full amount that they had prescribed to. Yes, yes. And so we exist to help small businesses that may make those mistakes. I'm actually working with a business right now where just in the loan that we're able to do a refi on, we're going to do a loan with this business and it's about $5,000 a month that he'll be paying us. But you know how much he was paying on that? $37,000 a month. Okay, so that's the difference because it's that predatory. I can get you a loan tomorrow, folks.
- [15:01]
A
It's about knowing what you don't know to help you prosper the right way, the correct way. Pam, how, once again, how can someone get in touch with you and your organization?
- [15:12]
B
Well, you can go to our website which is inclusified.org I n c l u s I f I.org or you can call our office anytime between 8:30 and 5:00pm the number is 561-845-8055.
- [15:28]
A
People, look, we, we, we are, we are talking about small business development, small business education, all those things with Pam Stewart. And Pam, when we, when we look at those pitfalls again, and I keep wanting to come back because I know people listening to us this morning and they have a business or a couple of businesses. But let's talk a little bit more about some of those issues that could help a small business prosper.
- [15:59]
B
Okay? One of the things that I will say that can help you prosper is understanding the story that Your financials are telling you. What I often ask when I'm talking to a small business is something like, what's your burn rate? That means that before you can make $1 of profit, how much money do you have to make just to pay the bills and keep the lights on?
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A
There you go.
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B
And you gotta be able to know what that number is. And so you know off the bat that you gotta pay $20,000 out either in salaries or your lease amount, those
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A
sorts of things, all those fixed costs,
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B
all those are fixed and variable costs. But you know that that's, you gotta pay that whether or not you make a dollar or not. So you gotta know what that number is so you can start then to plan for and understand, you know, what your profit margins are. So that's one mistake that I see a lot. Another thing that I see, Patrick, and I hate to say this, is that entrepreneurs may fall in love with the location and they believe that that is the spot for them and that's where they're supposed to be at. But they don't understand that there's ways you can negotiate on the lease. You can get some build out expenses, you can get a deferment, you can get all types of things, things that your landlord can contribute. And what happens is they will engage in a lease and be paying on that lease for months and sometimes years before they even get the door open. That is the worst thing that you can do. You know, I tell them all the time, whatever you do, don't sign the lease, get a letter of intent to lease the property. You can submit that to a funder and they can do a loan based on that. But you gotta make sure that you don't jump the gun and get yourself committed to something that you can't support in revenue.
- [17:46]
A
When we look at small businesses, and I'm a true believer that this country runs on small businesses, oh, absolutely. It's not the big corporations, it's the small business shops that are located all along the road, everywhere you turn around. In our current business climate, Pam,
- [18:09]
B
are
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A
we losing ground or are we gaining ground in development and the sustainability of our small businesses?
- [18:17]
B
Well, I will tell you this, Patrick, in light of things that are going on in the current administration and the talk against DEI and the softening, if you will, of programs that have benefited black and brown businesses and even small business or even women owned businesses, there is a, they're all at jeopardy right now. You know, you gotta make sure that you, not only do you know your game, but you're on Top of your game. And you understand how that game is played. Because if you don't and if you're not a part of the conversation, then you're gonna get lost.
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A
Yes.
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B
And organizations like myself, you know, we're being challenged right now because we're the Palm Beach County Black Business Investment Corporation. That's who we are. We've been that for 40 years now. We're not gonna change that, nor our mission.
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A
No, we're.
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B
But we understand now that we have to diversify our revenue strategies. We have to go after different things that we may not have looked at. We have to create a way to generate income for the business so that we can sustain the operation. And the businesses that are out there, you got to do the same thing. Because there's no more, you know, there's
- [19:25]
A
no more set aside for us.
- [19:27]
B
There's no more set aside. That's where I was going. And also, even points that you would get if you were so certified as a small business, those things don't exist anymore just based on race or gender.
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A
Right? Right.
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B
So because of that, you're on a level playing field with everyone else and people tend to do business with people they know and like. So if you're not out there having those conversations and you're not knocking on doors and promoting what your business can do and how you can do it and what your, you know, your value added proposition is, then you're going to get left behind.
- [20:04]
A
Well, you know, one of the primary business things that I think that all small businesses have to do is networking and relationship building. That, that, that is so important, that is core to your sustainability over time. Because if you're not networking and growing relationships not only with your customers or your potential customer, your potential partners or whatever, you're going to die.
- [20:29]
B
Yes. And let me tell you this. Every person that I meet, I'm trying to figure out ways that I can collaborate with them and I can partner with them to make the impact of what we do better. And if you're not out there having those conversations, then you're going to get left behind. Because if they don't know you, how can they actually do business with you?
- [20:49]
A
I want to just go back to a statement you said with the diversification of your funding. Just a couple weeks ago, HUD sent down an edict that said that they will no longer fund one on one housing counseling sessions, which is a core piece of the urban leagues business for our housing counseling. And our pushback was okay, no one, including you, Mr. Administrator and Secretary of HUD and everybody else. You will not sit in a group session and try to disclose your financial issues or talk about your particular case in a group setting. I'm sorry, that's not going to happen. That's confidential information. That's privacy and everything else. But they have sent down information that says that they will no longer fund one on one counseling. How can we do our business?
- [21:43]
B
I'm challenged, like I said, diversifying my revenue stream. What I've done is my reliance on federal funding is a lesson because I'm pursuing foundations, foundations that I'm mission aligned with and private funding and looking at program related investments. And I just think that business owners have to be just as innovative with their strategies to actually sell and to produce and to serve, you know, businesses that are out there.
- [22:12]
A
Pam, what do you, what do you. I'm not gonna, I'm not gonna go three years out. What are you foreseeing the next six months to a year? As far as the growth and sustainability of our small business and what you see on the horizon?
- [22:28]
B
I think that the ones that are the most fiscally sound will survive this. It's just that there are going to be a lot of businesses that will probably close and go out of business that are not prepared. If you look at things like the cost of gas right now, not to mention the cost of housing and everything that's here, you know, just to tariffs, you know, there are so many things that are working against us being able to have fair trade and to be prosperous. But you got to be able, you got to know what you don't know. You said that earlier. That's something I say all the time. You got to read, you got to learn, you got to understand your industry, where it's going and what you can do to get that competitive edge. And if you don't, then you're going to get left behind.
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A
Right? Because I mean a transportation based business right now you're hurting.
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B
Absolutely.
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A
You're definitely hurting.
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B
Because I'm hurting and I'm not a transportation based business.
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A
Your expenses have gone up 25, 35%.
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B
No, you're right.
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A
Overnight.
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B
You're right, you're right. Absolutely.
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A
And your income has not gone up that fast. You can't raise prices that fast.
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B
I would not want to be in a long distance transportation business right now. You know, I know that's, that's how they put food on the table, but I can't even imagine the cost of
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A
fuel is that almost $6 a gallon. I cannot even imagine it. That's unbelievable. Where it was $3 and 56 weeks ago.
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B
Absolutely. Even. Even when you think about Ubers, Lyft, all those people that are out there, you know, delivery services, they're feeling the cost of it as well. So the challenge is definitely there. Definitely.
- [24:01]
A
One more time. Pam, can. If someone wants to get in touch with you, how would they get in touch with you? Seeking service, go to our website, which
- [24:09]
B
is inclusify.org is I n c l u s I f I dot o r g or you can give us a call. 561-845-8055.
- [24:20]
A
Very good. And in closing, as always, what's next for Pam?
- [24:27]
B
Retirement? Patchy retirement. I said that last year.
- [24:30]
A
You know, another whole year has passed.
- [24:32]
B
You know, I think part of being a good business owner is understanding what your extra strategy is. And also in this nonprofit arena, we have to have a succession plan. You know, I think that new ideas, new energy, new perspectives is good. That's how we grow and scale. And I think a witness to that is just the change that our organization has gone through in the four years that I've been at the helm. So. And I know that building my employees up now so that they can lead the charge once I step back, I'm not going to do anything immediately, but, you know, I need to be on the beach drinking a margarita right now.
- [25:12]
A
I hear you, Pam, but I want to thank you for your service and your years of work in this valley of small business and also how you've worked with so many entities across Palm beach county to make them better.
- [25:28]
B
Thank you so much, Patrick. It's my why. You know, we, in this nonprofit space, we do it because of the mission, and it is just my why. And I love it.
- [25:40]
A
Well, I thank you and we will talk again soon. Yes, because you can't leave right now. You just can't leave right now. So, Pam, thank you for bringing this important information. Because, folks, if you're looking to start a business, if you're looking to grow your early infant business, if you're looking to find more information, what you don't know is hurting you that may help you to find out a new solution,
- [26:10]
B
call Pam, call me. I'm here as a resource, and we provide free counseling, we provide free workshops, and we provide loans. It's not free, but we do provide loans at reasonable rates. So contact me so that I can help you start, grow and scale your business.
- [26:29]
A
Thank you so much. All right, folks, we're going to talk a little bit about the Urban league now on June 20th, we're going to have our fourth annual summer food drive. And we are very pleased to announce our fourth site that we're going to be doing on that day. It's going to be in Fort Pierce, folks. We're coming north. We're coming north to the Fort Pierce area in Indian river. And we will be announcing a date soon. But I just want to make sure that everybody hears me, that we'll be having a site up in north counties in Fort Pierce. We're going to be in Belle Glade at Hand Park. We're going to be in Delray beach at Pompeii park. And we'll be in, in West Palm beach over at Temple Israel. So right across street from the Urban League. So put that on your calendar. That'll be on Saturday, June 20th. And we will open gates and pass out food at 7am you have more information in the next couple of weeks. Also, if you're looking for our home buyer education classes, we will have a class on June 13th and also on June 27th from 8:45 to 3:30 at the Urban League. Go to our website at ulpbc.org to get more information. And if you need to understand where your dollars are going, you get paid on Friday and you try to understand on Monday, where did my whole check go to? Then you may need to come to our financial literacy workshop and learn how to create a budget. Learn how to understand where your dollars that are coming in, where they're going, how fast they going. If you remember Pam said, what's your burn rate? Well, that goes along for your own personal business, also your family. It's the same thing, folks. Business is business, finance is finance. So if you want to learn more about how to handle your finances, how to eventually build wealth, come to the Urban League Financial Literacy workshop. We will have one on May 20th. We also have one on June 17th. So keep that in mind as you think about becoming a homeowner. How to manage your finances. Come to the Urban League. We can help you. All our programs are free. All you have to do is sign up and show up. Okay? That's all that we ask. Look, and if you are looking, if you are a young professional between the ages of 21 and 44, if you'd like to become a member of this great group, we have over 80 members in this group right now. Go to the Urban league website@ulppbc.org to get more information about our young professionals. And if you're just a little older than that, we have a place for you also the Urban League Guild. That's for our little more seasoned adults. Go to the urban league website, ulpbc.org or call the urban league at 561-833-1461 to get more information. And I want to thank you again for everyone who came out to our 53rd annual EOD gallery. We had a great time, and I thank all of you for coming out and supporting the Urban League. It means so much to us that we can get the support that you give us so that we can serve those in need. With that being said, folks, I want to thank you for joining us this Sunday morning. And come and join us next Sunday morning as we have more interesting people that are doing great things here in Palm Beach County. Have a great day, and we'll talk to you next Sunday.