CINCINNATI – Over the past seven years, Sherri Richardson has grown her Kenwood-based accounting firm to 10 full-time employees.
Richardson knows Richardson and Associates could be a lot bigger, but there are roadblocks in her way.
One is the time it takes to network and find new business opportunities. Another is getting in front of decision-makers. And a big one is the perception that the firm is too small to handle large clients.
"That is not true," she said. "We're on solid ground, and we have strong reach."
Richardson said she's confident her firm can double its annual revenues and get to $1 million or more in the next two to three years.
A new program at the African American Chamber could be just what she needs to do it.
The chamber wants to see more million-dollar minority-owned businesses in Greater Cincinnati and Northern Kentucky, and the organization is launching the Sudduth Society for Minority Businesses to help make that happen.
The program aims to help minority-owned companies with revenues between about $250,000 and $500,000 per year because those companies have the highest potential to become million-dollar firms in 24 to 36 months, said Sean Rugless, the chamber's president and CEO.
It is named after Horace Sudduth, a native of Covington who worked as a Pullman railroad car porter before he made his fortune in real estate and banking. He was a leading African-American businessman before his death in 1957 at the age of 68.
"If you take a company that has $250,000 in revenue today, on average it has two employees. If you grow it to $1 million, it will typically expand to have nine or more employees," he said. "The whole focus is to create more minority businesses of scale."
Pipeline For Region's Accelerators
The Sudduth Society is getting launched thanks to a $40,000 grant from the Greater Cincinnati Foundation to be awarded over two years.
Rugless said the chamber still is raising more money to fund the program, which will start working with between five and 10 companies in October.
Ultimately, Rugless said he hopes at least half of the Sudduth Society businesses will be candidates for one of the region's business accelerators or incubators, whether it's the Brandery, CincyTech or the Minority Business Accelerator at the Cincinnati USA Regional Chamber, known as the MBA.
"This is a pipeline to the MBA, not a replacement," Rugless said.
Businesses must have at least $1 million in annual revenue to become part of the MBA program, and many are far bigger than that, said Crystal German, vice president of the MBA and economic inclusion at the regional chamber.
"The (Sudduth) program is about preparing minority companies for the next level of business or the next level of service from a program perspective," she said. "Often times, businesses can kind of get stuck when they're below that $1 million threshold."
After companies have $250,000 in annual revenue or more, they're often at a size where their founders can't handle everything on their own any more, German said.
That's when a business owner must start thinking about strategies, financial systems, sales systems and expanding to include more employees.
"The business is now getting to a point where it can grow beyond you," she said. "So the ability of your business to grow profitably is based on your ability to grow an enterprise that is larger than your own talents and skills."
The Sudduth Society aims to help by identifying business opportunities that could help participating companies grow and working to develop the business owners' skills as executives and managers, Rugless said.
Strategies Already Have Worked
Rugless said he knows the program can work because he has seen a similar strategy work on a smaller scale.
The Cincinnati Minority Business Collaborative created two years ago got funding to help businesses grow through different stages.
Of the 20 businesses the collaborative worked with, four grew big and strong enough to be placed on the MBA's "wait list," Rugless said. And those companies were the size that the Sudduth Society will target.
"We gave them work on their operations plans and building stronger infrastructure, we helped them advance their business models and identify other sources of revenue," he said. "We also looked at their financial positioning and got their performance in line with industry benchmarks."
Companies have not yet been selected for the first group of participants, but Richardson said she is interested.
"I think it's great, and I think it would be very useful," she said.
Calista Smith said she thinks so, too.
Her consulting company, CH Smith and Associates , isn't quite big enough yet to qualify for the Sudduth Society.
But Smith said she expects to be large enough soon, and she said she will want to best advice she can get to grow wisely.
"You could find yourself in a precarious spot where you have more revenue, but you're netting a lot less," she said. "That's something that I want to avoid with my plans to grow."
the kind of advice that every small business needs, but it can be more elusive for minority business owners to get, said the MBA's German.
"Minorities typically don't have the same relationships as non-minorities," she said. "They may not have the resources or know how to access them."
That's where a program like the Sudduth Society can be such a big help, she said.
For more information about the African American Chamber, go to http://african-americanchamber.com .
For more stories by Lucy May, go to www.wcpo.com/may . Follow her on Twitter @LucyMayCincy.