NYC Business Solutions

Social Networking and Small Businesses: A Marriage Made in Heaven By Modi Haninovic, Infoaxis...

Fri, 25 May 2012 09:49:00 -0400

Social Networking and Small Businesses: A Marriage Made in Heaven

By Modi Haninovic, Infoaxis Technology Solutions

The advent of social networking gives smaller businesses a bigger voice in the market, allowing them to rise to a level nearly at par with their larger competitors. With social networking, the playing field is elevated to a battle of efficiency, cost effectiveness, and quality service – rather than advertising and marketing budgets.

One of the most difficult challenges smaller businesses traditionally face is having a bigger presence in the market. While many of these companies offer good, quality services at much more affordable rates, they are many times overshadowed by larger firms that have bigger budgets to spend on marketing, advertising, and the like.

Things have changed, though, with the advent of social networking. What was once a simple, social, get-to-know-each-other tool between people on the internet has now evolved into a tool that small businesses can take advantage of in order to get their voices heard.

The gist of social networking for business is the simple concept of reaching potentially millions of people at a mere fraction of what is normally spent on advertising and traditional marketing. The wide reach of social media allows businesses to find their voices and showcase what they can do. The playing field then moves from an unfair balance of advertising budgets to a battle of service quality and value for money, as it should be – and many smaller firms can compete effectively in this arena.

There are many ways to tap into the social networking phenomenon to boost your online presence and aid in your marketing.

Modi Haninovich has over 20 years of experience in the IT industry, providing Information Technology solutions and services to meet businesses’ unique needs. You can find Modi at www.infoaxis.com or drop him a note in the comment section below. And, don’t forget to share his post with your friends on Facebook and Twitter.

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The views, opinions, or expressions provided by Modi Haninovich do not necessarily represent the views, opinions, or expressions of the City of New York, the New York City Department of Small Business Services, and/or NYC Business Solutions.

Save Money in Lower Manhattan - It’s Easier Than You Think New York City has a full portfolio...

Thu, 24 May 2012 10:24:00 -0400

Save Money in Lower Manhattan - It’s Easier Than You Think

New York City has a full portfolio of benefits to attract businesses to Lower Manhattan. One of the most well-received of the programs is the Lower Manhattan Energy Program or LMEP.

LMEP provides property owners and commercial tenants in eligible buildings up to 45% reduction in electricity transportation and delivery costs. The full benefits last for 8 years, followed by a 4 year phase-out during which benefits are reduced by 20% each year.

Although businesses may shy away from programs that sound too technical, the LMEP benefit is quite easy to receive if a business leases space within a preapproved building. It is the building owner or developer who applies to the City and completes the application process. Moreover, the Incentives Team at NYC Business Solutions can also provide customized assistance to LMEP applicants – guiding them through the approval process. So don’t worry if you feel you don’t have the time to dedicate to filing forms or that the program seems complex – if you are business moving to Lower Manhattan or a building owner thinking of renovating your commercial office tower – we can help you reduce your energy costs.

The property owner typically makes the investment, but the benefits accrue to the tenants. For LMEP, as with most of New York City’s programs, Lower Manhattan is generally defined as the area south of Murray and Frankfort Streets, although some of the programs are available as far north as Canal and Houston Streets – so it is always a good practice to check with NYC Business Solutions.

Close to 40 commercial buildings currently qualify to provide electric rebates to their commercial tenants through LMEP. This represents a cumulative savings for businesses close to $25 million dollars each year – this is real money directly lowering monthly operating costs. Also, it not only the large international banks and brokerage houses that benefit – most of the recipients are small- to medium-size firms renting space throughout Lower Manhattan.

To qualify:

A building must be applying to the Industrial & Commercial Abatement Program (ICAP), the NYC Industrial Development Agency (NYCIDA), or be owned by the City of New York or Empire State Development Corporation (ESDC).
A property owner needs to make investments to renovate and upgrade the building. Typically capital investments are to exceed 30% of the assessed valuation (AV) of the building and land. For buildings owned by the City, the State, or NYC Industrial Development Agency (IDA) the investment requirements is slightly lower - at 20 % of the property’s AV.

The program has very strict filing deadlines:

Building seeking eligibility through the NYCIDA must file a LMEP application prior to approval by the NYCIDA Board
Applicants managing a City or certain New York State owned facility must file a LMEP application prior to signing a lease to manage the building
ICAP applicants must file a separate ICIP application with NYC Department of Finance
All Applicants must file an application prior to issuance of building permit and commencement of work to upgrade the building

It’s best to pre-screen with NYC Business Solutions to verify eligibility for the program and clarify any questions regarding application procedures.

As well as lowering energy costs, the City of New York offers a full portfolio of additional benefits to businesses moving to Lower Manhattan - including abatements on monthly rent for businesses signing a new lease or renewing a lease to keep operations downtown. Here are some of these programs:

Commercial Revitalization Program (CRP)

Benefit: CRP provides rent rebates up to $2.50 psf up to 5 years for commercial or retail businesses signing new, renewal, or expansion leases in Lower Manhattan

3 or 5 year benefit (determined by length of lease), including 2 year phase-out

Eligibility: Commercial and retail businesses must meet all of the following requirements:

Signing at least a 3 year lease south of Murray / Frankfort Streets
No sublets
Located in a building built before 1975
Invest at least $5 psf in permanent, capital improvements to the space
If more than 125 employees, the business must have a lease of at least 10 years and invest either $10 psf (renewal leases) or $35 psf (new and expansion leases)

To Apply: Business must apply jointly with landlord within 180 days of lease commencement

Businesses in Lower Manhattan may also be eligible for relief from commercial rent tax. The Commercial Revitalization Program (CRP) and Commercial Rent Tax Reductions work in conjunction with LMEP to provide additional savings to businesses:

Commercial Rent Tax (CRT) Special Reduction

Benefit: CRT Special Reduction provides a 3 or 5 year abatement of the Commercial Rent Tax (6% of annual rents over $250,000)

Eligibility: Commercial and retail businesses that are receiving CRP are automatically eligible for the CRT Special Reduction

Tenants who lease space in government-owned buildings may qualify for the tax credit without applying for CRP and having to meet the investment requirement

Whether you are an existing business leasing space in Lower Manhattan or thinking of relocating to the area – New York City can make it attractive to grow your business in this historic and exciting neighborhood. To learn more about these and other programs call 311, or go the Incentives Estimator on NYC Business Express.

As Assistant Commissioner at the NYC Department of Small Business Services, Don Giampietro oversees such programs as the Energy Cost Savings Program (ECSP), Lower Manhattan Energy Program (LMEP), Printers Relocation Grant Program, and Industrial Relocation Grant Program. Don has over 15 years of experience working to help commercial and industrial firms relocate and expand within New York City.

Leave Don a comment or question below. And, please share this with your network in Twitter and Facebook.

Think You’re Too Small to Bid on a Big City Contract? Think About Teaming. By Denise Rodriguez...

Tue, 22 May 2012 14:36:00 -0400

Think You’re Too Small to Bid on a Big City Contract? Think About Teaming.

By Denise Rodriguez Lopez, American Express OPEN Advisor on Teaming

Last month, over fifty New York City area small business owners attended the 2nd NYC Teaming event, a joint initiative between NYC Business Solutions and American Express OPEN under the “Compete to Win” suite of programs.

The event focused on the different types of joint venture arrangements (i.e., teaming relationships) that enable small businesses to win large contracts with government and corporations.

Below are my top tips from the event:

1. If you see an opportunity that you would like to pursue via teaming, take the RFP and deconstruct it to its basic requirements. Examine these components and determine what kind of assistance you may need in order to respond to the RFP. Once you have determined your needs, you are ready to seek teaming partners. Remember the elevator pitch from the 1st workshop? You need it now. Pitching your business or team to a potential client is all about “this is what I/we can do for you.” Pitching to potential teaming partners is all about “this is what we can do together.”

2. When vetting potential teaming partners, consider such factors as their:

Ø Years of experience

Ø Number of full-time employees

Ø Geographic location and area of service

Ø Positive past performance in your interested market

Ø Financial stability

Ø Necessary certifications or industry licenses required by the potential projects

Ø Areas of expertise and how they mesh with your expertise

Ø Reputation in the industry

Ø Membership in industry or trade organizations

3. Properly documenting your teaming arrangement is crucial for success. Your teaming contract should be thorough and detailed. Tailor it to fit your needs, but include such basic elements as:

Ø How the team will seek and respond to opportunities

Ø Who will be the team point of contact for the client

Ø What work each member of the team will be responsible for (level of effort, percentage of work, or task-oriented)

Ø How invoicing will be handled

Ø How payments will be received and distributed

Ø How the team will respond to issues that may arise

Ø If the team creates an innovative procedure or product, how will ownership issues be handled

Teaming partners can be companies you’ve known for years or new companies you’ve met through events such as NYC Teaming. Who will you meet at our next event on May 22^nd?

If you’re interested in learning more about how Teaming can work for your business, visit us on the web or drop us a note in the comment section below.

Perfect the Pitch Speaking in public is tough. Presenting to others who are evaluating your...

Mon, 21 May 2012 10:34:00 -0400

Perfect the Pitch

Speaking in public is tough. Presenting to others who are evaluating your business is tougher. Making a competitive presentation when money is on the line is brutal.

In April, I was a judge in the 6^th Annual Queens StartUP! Business Plan Competition. It is conducted by one of our community partners, Queens Economic Development Corporation. Below are 7 basic lessons – which the 3 winners of the Queens StartUP! Business Plan Competition knew – and you should consider when making a pitch for your small business.

Competitions for funding are few and far between, but there are plenty of scenarios when you will be required to present your business. You will need to pitch to potential employees, investors, lenders, business partners and customers.

· Know Your Audience: Customize your presentation to the audience. Your pitch in a business plan competition will differ from the pitch you give to an investor. The business plan judges look for a well-researched idea that will benefit the local economy, but with conservative returns. An investor looks for huge returns, and will accept more risk. Customize the pitch accordingly.

· Cover the Basics: Don’t assume that the audience knows your industry. At a minimum, there should be no doubt in the listeners’ minds that you answered the following questions: What is the product and service? How much progress you have made towards launching the business? What is the problem you are solving? Who is your target market? How do you plan on reaching them? What is your marketing strategy? Who are your competitors? How are you better? What are your costs? Why do you need funding? Who is your team and what relevant experience and knowledge does everyone bring to the table?

· FAQ’s: After you’ve covered the basics, you need to anticipate the types of questions that you will be asked. Be able to explain all financial assumptions, pricing strategies, competitive analysis, major costs, marketing strategies and other components that you think require a more detailed explanation. Have additional slides ready with answers to questions that you expect to be asked.

· Don’t let Technology beat you: Go into the presentation knowing your environment. Will you have internet access? Have a backup copy of your presentation on a flash drive and print handout slides in case the computer crashes. If you have limited time, every minute counts. Don’t waste it struggling with the computer.

· Simplicity: With a limited amount of time, focus on what matters most. Tell your story, get your idea across, tell how you are going to do it, and why you are the best. Keep your slides simple as well. Trying to include too much information will lead to a confused message.

· Sell yourself: Tell your personal story of how you got to this point. How did you come up with the idea? Your passion and excitement should shine if you are able to explain the opportunity and your game plan for making it happen. A heart-warming tale is not a substitute for a good plan, but it certainly complements a good one.

· Practice: You probably are going to be nervous and that makes sense. All you can do is be as prepared and confident as possible. Practice your pitch in front of friends, family members and anyone willing to listen. Listen to feedback, be flexible and keep improving.

Brad Seader is the Director of the NYC Business Solutions Centers in Queens. If you have a question or comment for Brad, drop him a note below. And, please share his blog entry with your colleagues on Facebook and Twitter.

Another Benefit of Certification: A Special Invitation to Meet Agency Buyers Last year, New York...

Thu, 17 May 2012 11:09:46 -0400

Another Benefit of Certification: A Special Invitation to Meet Agency Buyers

Last year, New York City conducted over 55,000 transactions to buy $15 billion worth of supplies, services and construction, making the City one of the largest contracting jurisdictions in the country. Several dozen City agencies independently purchase a broad array of goods and services and they often use different methods to select vendors according to their business needs and the City’s procurement rules. How do you get to the bottom of it all?

One excellent place to start is attending the City’s upcoming annual Procurement Fair on May 23^rd. This event is free of charge and is only open to City-certified M/WBE firms.

Over 600 firms will register to meet representatives from 90 City and State agencies, private corporations, and business organizations. These firms will have an opportunity to speak with the purchasing staff from agencies with expertise in professional services, standard services, goods, and construction. They will discuss a range of topics from current and upcoming contract opportunities to common pitfalls to avoid.

The Procurement Fair is a great place to get the competitive edge you need. Here are three tips to getting the most out of the Procurement Fair:

1. Know the Buyers. You’ll be provided with an Agency Guide to identify the City agencies that are buying your products and services. Make sure you have enough business cards for the buyers you want to meet.

2. Ace the Audition. Make no mistake; attending the fair is your opportunity to position your business as an established firm. Use your time wisely and aim for 10-minute conversations with those you came to meet and leave a lasting impression. (For advice on making a pitch, see these related blog posts.)

3. Build Relationships.: Make every interaction count and remember that you are building relationships that can benefit your business. Make sure you have enough business cards for the buyers you want to meet. Then, have a plan in place for follow-up conversations with those you want to keep in contact with after the fair.

To register for the Procurement Fair, call 212-209-3836 or email info@nyc2012fair.com. And, if you aren’t yet registered, visit us on the web for more information or you can always drop us a note in the comments section below.

Anne Rascon is the Deputy Commissioner of the Division of Economic and Financial Opportunity at the NYC Department of Small Business Services. In this role, she oversees the Selling to Government and Certification services of NYC Business Solutions.

If you have a question or comment for Anne, please drop her a note below. And, don’t forget to share her column on Twitter and Facebook.

3 Costly Legal Mistakes Your Business Should (and Can) Avoid by Arina Shulga, founder of Shulga Law...

Tue, 15 May 2012 10:52:00 -0400

3 Costly Legal Mistakes Your Business Should (and Can) Avoid

by Arina Shulga, founder of Shulga Law Firm, P.C.

Starting and running your own business is a risky undertaking. We all know the statistics that tell us that the overwhelming majority of new businesses fail. However, you can minimize your risks by avoiding certain common legal pitfalls. Here are my top 3:

1. Selecting the wrong legal entity type. Most entrepreneurs in New York choose among these 3 types of legal entities when incorporating: a C corporation, an S corporation, or a limited liability company (LLC).

A C corporation is your regular corporation. It has a board of directors, who are elected by the shareholders. The directors appoint officers and oversee the strategic direction of the corporation. The officers manage day-to-day affairs of the corporation. A C corporation is subject to double taxation: income of the corporation is taxed twice, first at the level of the corporation and second, at the shareholders’ individual tax rate when dividends are distributed.

An S corporation is a C corporation that has elected the special federal and state “pass-through” tax treatment. Only U.S. citizens or permanent residents can be shareholders of an S corporation. Further, an S corporation can have only up to 100 shareholders, all of whom must be individuals (or family trusts). Shareholders of an S corporation can have only 1 class of shares: common stock. All shares have to have the same economic rights to profits, distributions, and the same preferences in liquidation of assets.

An LLC can have unlimited number of members. Members can be foreigners, and can be other companies. An LLC has the most flexible form: it can be managed by members or by managers. Members can even agree to share profits and losses disproportionately to their equity in the company. For example, if there are 2 members with 50% equity ownership each, they can agree to distribute 75% of their profits to 1 of the members and only 25% to the other. In New York State, all LLCs must comply with a publication requirement and publish a notice of formation in 2 newspapers in the county where the LLC was formed for a period of 6 weeks. This can get expensive, especially in New York County.

If you do not plan to hire employees, raise capital for your business, and your business is profitable (i.e., you are relying on your revenue to cover costs of running your business), then forming an LLC may be a great choice for you. If you plan to hire employees, but still you do not rely on outside financing to run your business, consider an S corporation. However, if your business requires substantial outside capital from angel investors or venture capital firms, consider forming a C corporation. Many professional investors will not invest in an LLC because of its pass-through tax structure. They prefer investing into a S or C corporation that is incorporated in Delaware.

Converting from one entity type to another may result in unexpected tax consequences and high legal fees. To avoid this, I definitely recommend consulting with a business attorney and an accountant to choose the right legal entity for your business from the start.

2. Not entering into written shareholder agreements with your partners. When several partners decide to start a business together, they should enter into a partnership agreement that would define the internal rules of their company. Absence of such agreement is by far the most common mistake I see – and also the most costly one to correct.

Typically, a partnership agreement (also called a “shareholders agreement” or an “operating agreement”) deals with the following issues:

· Who manages the company?

· What are the duties and expectations of each of the partners?

· What happens if one of the partners commits a crime or his employment is terminated for cause?

· Do some corporate decisions require unanimous or super-majority vote of the partners?

· What happens in the case of a death or disability of a partner? Can the company buy back his or her shares?

· How can partners exit from the company? Can they sell their equity to a third party?

· Can partners be required to sell if a partner holding majority of equity wants to sell his or her equity to a third party?

Partners should know the answers to these questions before any of these situations arise. Then, all they need to do is refer to the agreement and follow its provisions.

3. Doing handshake deals with your vendors and customers. If you do not have a written agreement, then you may be surprised to find out that you and your vendor or customer had a different idea about what was supposed to happen. Often, deals end up in court because parties thought they had an understanding. You do not need a long and complicated contract full of legal terms that are difficult to understand. A simple contract that lays out all of the material terms is sufficient.

Next time you negotiate with a vendor or customer, think about these questions:

· What is the scope of work or services?

· When will it be performed?

· Who will perform the work/services?

· What is the payment structure?

· Is it a flat payment or will the total amount depend on hours worked or some other factor?

· Does the payment depend on the costs of materials?

· Who owns the work that was created?

· What if certain services or work is not performed or is not performed to your satisfaction? Can you get out of payments?

Beware if someone tells you “you don’t need a lawyer,” pressures you to get the deal done quickly, or says that they already had a lawyer review the agreement. You may be in for a surprise if things go wrong. Make sure to have a contract in writing, and have contracts that are drafted by others reviewed by an attorney representing your interests. Legal fees for contract reviews and drafting are typically much less than the fees for law suits.

Arina Shulga is the founder of Shulga Law Firm, P.C., a law firm that focuses on representing small and growing businesses. Arina conducts a monthly free legal clinic at NYC Business Solutions, Brooklyn Center. She writes a blog, www.businesslawpost.com, and is active on Twitter (@Businesslawpost). If you have a question or comment for Arina, drop her a note below. And, please share this blog entry with your colleagues on Facebook and Twitter.

Note that this blog is for informational purposes only and should not be relied upon as a legal advice.

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The views, opinions, or expressions provided by Arina Shulga do not necessarily represent the views, opinions, or expressions of the City of New York, the New York City Department of Small Business Services, and/or NYC Business Solutions.

Got Credit? June is credit month at the NYC Business Solutions, Upper Manhattan and Washington...

Sun, 13 May 2012 09:43:14 -0400

Got Credit?

June is credit month at the NYC Business Solutions, Upper Manhattan and Washington Heights Centers.

They’ve teamed up with lenders to help you repair your credit via secured loans or micro-loans.

If…

you never had credit and are unsure of how to get started…
you have damaged credit and are unsure of how to fix it…
you are thinking of starting your business and need funding…

…this event is for you!

Find information on event dates/times and register here. Space is limited.

A New Health Insurance Resource for New York’s Small Businesses by Marjorie Cadogan, Executive...

Thu, 10 May 2012 10:01:00 -0400

A New Health Insurance Resource for New York’s Small Businesses

by Marjorie Cadogan, Executive Deputy Commissioner of the Human Resources Administration’s Office of Citywide Health Insurance Access

The Small Business Assistance Program is a new resource available in New York that is designed to address the specific insurance and health care needs of small businesses, to help businesses understand current and upcoming changes due to federal health care reform, and to provide information regarding the emerging Small Business Health Options Program or “SHOP” feature of the recently created New York State Health Benefit Exchange.

Community Health Advocates, a program of the Community Service Society, administers this new federally-funded program by partnering with a network of thirteen business-serving groups throughout New York State, 7 of which are in the 5 boroughs.

Through outreach and educational programs, as well as one-on-one interactions with small businesses, the Small Business Assistance Program will provide assistance with:

Helping small businesses learn about their health insurance rights and responsibilities
Health care reform information and training for employers
One-on-one consultations on insurance options, costs, tax credits, enrollment, dispute resolution, and more
Understanding the pros and cons of Health Savings Accounts (HSAs) and other small group products
Services in every region of the state, in any language

To learn more about this program or to seek immediate assistance, visit the Community Health Advocates website: http://www.communityhealthadvocates.org/

To learn more about health insurance basics, consumer rights and protections, and consumer assistance in New York State, or to find a health insurance plan that fits your needs, visit NYC Health Insurance Link: www.nyc.gov/HILink

Marjorie Cadogan is the Executive Deputy Commissioner of the Human Resources Administration’s Office of Citywide Health Insurance Access (OCHIA). If you have questions or would like more information on HRA’s OCHIA, email Heather Palenschat, Health Insurance Initiatives Analyst for the Human Resources Administration at palenschath@hra.nyc.gov.

Please share this information with your network on Facebook and Twitter.

nycedc: The tech sector is growing faster in New York City than...

Thu, 10 May 2012 09:35:28 -0400

nycedc:

The tech sector is growing faster in New York City than anywhere else in America, finds Center for an Urban Future’s new report, New Tech City. Read the full report, including a 2012 NYC Digital Startup Index, which credits the Bloomberg Administration and NYCEDC for its efforts to diversify the City’s economy and build up the tech sector.

Related reading: “New York’s Tech Industry Tops U.S. in Growth, Study Finds” (NYTimes)

GET INSPIRED: From Freelancer to CEO at 60+ Years Old By Harriet Hoffman, CEO of Make the Right...

Tue, 08 May 2012 09:50:00 -0400

GET INSPIRED: From Freelancer to CEO at 60+ Years Old

By Harriet Hoffman, CEO of Make the Right Choice

Five years ago, I left my full time position as a Director of Institutional Giving at a successful not-for-profit community health center to become a “freelance” grant writer. At first it seemed easy; I picked up some regular clients right away and was doing okay. I liked setting my own schedule and working from home.

Around the same time people began asking me questions about how best to access their social security and/or Medicare benefits. Because my professional background had included both government healthcare funding and senior services programming, I understood health care terminology, government regulations, compliance and budgets – just what is needed to navigate the Medicare maze. By then I was enrolled in social security and Medicare, so I realized how impenetrable and complex the system had become, and I freely gave advice to help others make the most of the benefits they needed and would use for the rest of their lives.

Then, along came the economic downturn and suddenly there wasn’t much work for a “freelancer”.

What was I going to do? A friend suggested I use my expertise to start a new consulting business and charge a fee for the advice I was offering. I thought it was a good idea – I figured it would bring in another income stream and make me more strategic about all the services I offered and the fees I charged – but I didn’t know anything about business!

I heard about a free workshop on entrepreneurship that was being hosted by The All Stars Project’s UX in my neighborhood, and decided to attend. Before the first seminar ended, I knew I needed a plan. I also realized how much I would benefit from the “formal” education of a serious class. So, I decided FastTrac NewVenture was right for me!

I learned many things taking FastTrac NewVenture – the necessity of constant networking, how to set prices, bootstrapping (I’m now an expert), identifying my edge in the marketplace — but most important was the confidence I gained. People see me differently now; I’m someone who took a risk and carved out a new kind of niche in the post-economic downturn economy. FastTrac NewVenture brought out the businesswoman in me that was there the whole time!

My new business, Make the Right Choice, is doing well. I provide personal consultations to guide individuals through the critical but complex process of understanding Medicare and/or Social Security, assessing their options, identifying which ones best meet their needs, and signing up for benefits. And, I’ve found a way to help small businesses reduce their health insurance costs for their older employees.

Harriet Hoffman is the CEO of Make the Right Choice: Your Medicare and Social Security Benefits. Harriet provides personal consultations to guide individuals through the critical but complex process of understanding Medicare and/or Social Security. She also helps small businesses reduce their health insurance costs for their older employees. You can find Harriet online at http://www.harriethoffman.com/.

Please drop Harriet a question or comment below. And don’t forget to share this with your friends on Facebook and Twitter.

The views, opinions, or expressions provided by Harriet Hoffman do not necessarily represent the views, opinions, or expressions of the City of New York, the New York City Department of Small Business Services, and/or NYC Business Solutions.

Why Has New York Become a Paradise for Tech Startups?

Tue, 08 May 2012 09:33:10 -0400

Why Has New York Become a Paradise for Tech Startups?

Financing 101 How does one get financing? How much money does one ask for? What is the likelihood...

Mon, 07 May 2012 10:01:25 -0400

Financing 101

How does one get financing? How much money does one ask for? What is the likelihood that one will get financing? These are all great questions and there is no cookie cutter answer to any of them.

Let me start off by saying that in order to acquire financing it is usually better to get it when you don’t need it, rather than waiting until it is an absolute necessity for the survival of your business. This can be accomplished by getting a business line of credit. Many banks will offer business lines of credit to businesses based on the amount of time that the business has been established, profitability, inventory, cash flow, and numerous other factors that may vary from lender to lender. Banks will usually charge a relatively small fee annually to maintain the credit line but will not charge you for the line until you start to draw down on the funds. (Please keep in mind that all lenders are governed by their own rules and regulations and you should check with your specific lender for all potential cost and fees).

Ok, how may one get financing? The first thing that I suggest that you do is to create a business plan. All lending institutions do not require you to have a business plan in order to get financing, but it is better to be prepared with it so that if they do ask for it you have it ready. The business plan should reflect the amount of money that you will need, otherwise known as “startup capital.” Although it is important to plan for contingencies, it is more important to be as accurate as possible with the financial request.

Business owners should be aware of what their FICO (otherwise known as credit) score is like when going for a loan. This will determine which institution we will focus on while trying to assist you with the loan. The higher your Fico score, the better your credit. The numbers can range from about 300, on the low end, to 850, on the high end. Traditional lenders (banks) usually do not lend to applicants with a credit score below 680 (not without a valid explanation).

Alternative lenders are willing to lend to individuals with a credit score below 650 but they must have a very sound business plan (including financial projections) and usually need a cosigner. Please note that some alternative lenders usually lend at a higher interest rate as well.

Please keep in mind that when you are inquiring about which lender is suitable for you and your business need, it is better for the institution to NOT run your credit until you are certain that they have the most suitable product for you. When searching for credit, having the lenders check your credit score too many times will negatively impact your score. It may benefit you to have a recent copy of your credit score/report to take with you when meeting with lenders. They will eventually have to run your credit themselves to verify that the information is still accurate but they should be able to give you a ball park estimation based on the information that you present to them.

It isn’t possible for me to answer all the questions that one may have regarding the intricacies of getting financing especially in the current environment. However, I hope that I have provided enough information to get you comfortable with the process. Please feel free to contact your local NYC Business Solutions Center to get assistance with obtaining financing or to answers to any other questions that you may have.

Paul Smith is the Center Director of NYC Business Solutions, Bronx. If you have comments or questions for him, please drop him a note in the comment section below!

Is that Worker an Employee or an Independent Contractor? by Stephanie L. V. Hendricks, owner of...

Fri, 04 May 2012 09:51:00 -0400

Is that Worker an Employee or an Independent Contractor?

by Stephanie L. V. Hendricks, owner of Hendricks Law Firm

Determining if a worker is an employee or an independent contractor usually depends on a number of factors, and in some cases, the answer may not be clear.

In cases where making the determination may turn out to be difficult, it may be useful to enter into a written agreement indicating the parties’ intent and defining the terms of the relationship. The party preparing the agreement might consider specifying the factors that support the desired classification of the person providing the services.

However, just because the parties say that a person is an independent contractor does not mean that a court will agree.

In New York, it is likely that, while the terms of a contract will be helpful in making the determination, the following are factors that a judge will consider to determine whether an individual is an independent contractor and not an employee:

whether the person controls the time and manner in which the work is to be done;
whether the person has a Federal Employer Identification Number from the Federal Internal Revenue Service (IRS) or has filed business or self-employment income tax returns with the IRS based on work or service performed the previous calendar year;
whether the person maintains a separate business establishment from the hiring business;
whether the person performs work that is different than the primary work of the hiring business and performs work for other businesses;
whether the person operates under a specific contract, is responsible for satisfactory performance of work, is subject to profit or loss in performing the specific work under such contract, and is in a position to succeed or fail if the business’s expenses exceed income;
whether the person has a liability insurance policy (and if appropriate, workers’ compensation and disability benefits insurance policies) under his or her own legal business name and federal employer identification number;
whether the person has recurring business liabilities and obligations;
whether the person has business cards or advertises for themselves or their own business;
whether the person provides all equipment and materials necessary to fulfill the contract; and
whether the person works under his or her own operating permit, contract or authority.

Courts will generally tend towards concluding that the person is an employee, rather than a general contractor unless a clear case can be made that the person is, effectively, running their own business, and the “employer” is only one of many clients of the business.

Stephanie Hendricks owns Hendricks Law Firm, which focuses on providing New York entrepreneurs, small businesses, and start-ups with a full range of business services. Stephanie Hendricks provides pro bono legal services monthly at NYC Business Solutions, Staten Island Center.

Note that this blog is for informational purposes only and should not be relied upon as a legal advice.

——

The views, opinions, or expressions provided by Stephanie Hendricks do not necessarily represent the views, opinions, or expressions of the City of New York, the New York City Department of Small Business Services, and/or NYC Business Solutions.

Made in NY: InVision, a NYC tech startup that creates prototyping platforms for...

Thu, 03 May 2012 16:20:44 -0400

Made in NY: InVision, a NYC tech startup that creates prototyping platforms for...:

madeinny:

InVision, a NYC tech startup that creates prototyping platforms for web and mobile app designers, is the latest tech company to receive seed funding from the NYC Entrepreneurial Fund.

The Daily News reports:

“The lucky startup was co-founded by Clark Valberg, 31, and Ben…

Advice for Bidding on Public Works Contracts Welcome to the first edition of the Compete to Win...

Wed, 02 May 2012 09:13:00 -0400

Advice for Bidding on Public Works Contracts

Welcome to the first edition of the Compete to Win column on the NYC Business Solutions Blog. Every month, I’ll discuss issues that would prevent you from being competitive in bidding on public works contracts. I look forward to your feedback.

Now, did you know that when your parents nagged you about tucking in your shirt, they were really teaching you that first impressions count? In business it’s no different.

The first impression you make – how you present yourself on paper – will determine whether or not you get access to many credit-based products, like access to capital and bonding. So here are a few tips on how to grow up your business and tuck that shirt in:

Experience: Did you know that your experience and track record are vital for bonding and even some loan products? It’s important to highlight the work you’ve done, and unlike a resume, the more work experience the better. So don’t short change yourself by leaving out experience.
Financials: One of the major reasons loan applications are rejected is the lack of updated financials. You should have your balance sheet, income and expense statement updated frequently. Also make sure your accounts receivable and accounts payable aging are updated. Having these documents updated can quickly speed up the process when you’re looking to access a loan to help with startup costs and purchasing materials.
Future Planning: Do you have your income and expense projections for the next 2 years completed? A lot of companies live in the moment. How do you know this job you’re competing for will actually be profitable for your company to pursue? Without proper planning you could set yourself up to overreach on certain contracts, which in turn could devastate your bottom line.
Research: Most cities including New York City have a vast array of services to assist firms in the bidding process. Do your homework before paying expensive consultants to provide the same service that you could have obtained at no cost. Often times your bid is tossed out because you didn’t respond correctly to the questions asked, or there was an incorrect calculation in the packet. New York City provides firms no cost bidding technical support to help you avoid such pitfalls
Staffing: Similar to your presentation on paper, you have to make sure you have the right staff doing the right jobs. There’s a big difference between a CPA and a CPA with a specialty in the construction industry. Who you have employed could be the deciding factor in a number of credit products including bonding.

We’ll continue more in my next blog about specific areas, including how you can use the new set of Compete to Win services to help build the capacity of your business to become more a competitive bidder.

Gregg Bishop is the Assistant Commissioner of M/WBE Capacity Building Services at the NYC Department of Small Business Services, where he helps businesses “compete to win” by improving their chances of successfully bidding on public works contracts.

If you have a question or comment for Gregg, please drop him a note below. And, don’t forget to share this with your network on Facebook and Twitter.

Silicon Valley, London, NYC: Startup Genome Data Reveals How The World’s Top Tech Hubs Stack Up

Tue, 01 May 2012 14:42:48 -0400

Silicon Valley, London, NYC: Startup Genome Data Reveals How The World’s Top Tech Hubs Stack Up :

madeinny:

“Last year, we covered an ambitious collaborative R&D project called ‘Startup Genome,‘ created by three young entrepreneurs, Bjoern Herrmann, Max Marmer, and Ertan Dogrultan. The goal of the ongoing project was (and is) to take a comprehensive, data-driven dive into what makes tech startups successful — and not so successful.”

New York's Coolest Start-Up Offices

Tue, 01 May 2012 14:34:00 -0400

New York's Coolest Start-Up Offices

Increase Your Problem-Solving ROI: Clearly Articulate “What is Needed” In my last blog post, I...

Tue, 01 May 2012 09:38:00 -0400

Increase Your Problem-Solving ROI: Clearly Articulate “What is Needed”

In my last blog post, I described the importance of correctly identifying a problem, and its most intrinsic “prime number” components, as the first step in solving complex and difficult to solve problems. In this post, I will describe the next step in the process – determining “What is Needed,” or envisioning the solution. You should be able to craft a statement, somewhat long-ish, objective, and very descriptive, that will serve as a guidepost, and describes what the ideal solution will look like. The “What is Needed” statement usually has multiple components, else the problem would not be complex and difficult to solve!

If we think back to the men and women who designed and built the first manned spacecraft to land on the moon – what might their “What is Needed” statement contained? Perhaps it read something like this: “What is needed is a conveyance that is strong enough to protect squishy and fragile-on-many-fronts human cargo from intense forces of multiple types encountered all along its journey; small enough and light enough so that lift-off and breaking away from the Earth’s gravity is possible given the constraints associated with known fuel types; the conveyance must continue to be maneuverable and retain propulsion capability while in space; the conveyance must be able to land on the moon; must contain all of the fuel, life support, communication, and scientific equipment required of it in a very small space; and the conveyance must be able to take off from the moon in order to return to Earth, with fuel, energy, and systems to last the entire journey; the conveyance must not burn to a crisp upon re-entry.”

Sufficient time and energy should be devoted to crafting a complete “What is Needed” statement. You and your organization should be able to read the statement and see / identify all of the critical components that are needed from the solution you will craft. If there are critical elements missing from the “What is Needed” statement they should be added, until you are able to read the statement and see / identify all of the attributes required in order to solve your complex and difficult to solve problem.

One of the benefits of the crafting a “What is Needed” statement, using long-ish, objective, and descriptive language is that it will help you to avoid misunderstandings within your organization as to “What is Needed.” Organizations can get themselves into trouble by using too much shorthand, too much jargon, too many false synonyms, and relative – rather than objective – terms. Imagine that instead of the “What is Needed” statement I conjured, above, regarding designing and building the first manned spacecraft, I offered up: “Build a fast rocket to blast man into space.” Much of what was laid out in the “What is Needed” statement would be lost in such a subjective truncation! Many misunderstandings on the part of the team would be possible. Many needed components of the solution could be overlooked.

In a small business solution crafting context, this means eschewing statements like “We need a CRM system!” or “We need to get everyone in a room and work it out!” or “We need a website!” in response to identified problems that require definitive action. Instead, make sure that your “What is Needed” statement captures the true essence of what is required.

Instead of saying “We need an intranet!” try to capture “What is Needed” with a statement like this: “What is needed is an internally-accessed website that contains one version of the truth, templates, branding guidelines, procedures, and instructions for our employees to better communicate with customers and execute administrative transactions, that contains a library of forms that are stored in softcopy format and always up-to-date, that acts as a portal to aggregate different systems that are used for executing different tasks like timekeeping, procurement of goods and services, processing fleet, facilities and technology help requests; that contains organization-wide organizational charts and sub-division organizational charts; that has a homepage for promoting important events and highlighting important achievements in order to unite and bind the culture of the organization; that contains floor plans, equipment and facilities inventories; and that is an application that is permanent part of each employees desktop icon set, so that it is launched each time a desktop is turned on.”

By forming comprehensive and robust “What is Needed” statements, it is much easier to scour the landscape for solution components to complex- and difficult-to-solve problems. Naming all of the pieces of “What is Needed” will facilitate the process of evaluating potential solution components and ensure that important pieces of the problem are not left unaddressed.

In my next post, I will describe creative and innovative ways to uncover and discover solution components – and how to unlock untapped potential in tools, software, equipment, etc. by thinking about them in unorthodox ways.

Until then – here is another strategic operations haiku:
Envision future
Ignore all current constraints
Describe what you see!

Kevin Kelly is the Deputy Commissioner at the New York City Department of Small Business Services (SBS) responsible for services to help businesses start, operate, and expand in New York City. Kevin writes this column on the NYC Business Solutions Blog on the 1st Tuesday of every month.

If you have a question for Kevin about problem solving at your business, leave a note below. And, don’t forget to share this post with your network on Facebook, Twitter, and email.

Basset Hounds and Financial Projections What will your revenue be next month? How about next year?...

Mon, 30 Apr 2012 11:05:00 -0400

Basset Hounds and Financial Projections

What will your revenue be next month? How about next year? How will growth affect your electricity expenses? How about your insurance?

If you don’t know where to begin answering these questions, you’re not alone. For many business owners, the only thing scarier than not knowing the future is trying to predict it.

Aspiring entrepreneurs and seasoned veterans alike too often make the mistake of focusing on today at the expense of tomorrow. Business owners tend to fall into one of two camps: those who see projections as useless guesswork and those who are petrified at the sight of a cash flow statement.

Having sat with hundreds of entrepreneurs to develop financial statements, I can tell you that projections don’t have to be scary and they certainly don’t have to rely on blind guessing.

Trust me, if you cower at the sight of a Profit and Loss Statement, you have more in common with your fellow business owners than you think. When helping clients prepare their first set of financial projections, my number one priority is getting them past that initial fear. My advice is always the same: start writing. It’s amazing how petrifying a clean, empty spreadsheet can be, so mess it up a bit. I like to tell people that any “guess” you make to get yourself going is almost certainly closer to reality than a blank page. Don’t think of that initial estimate as the final number but rather the first step in a constantly adjusting process that will bring you increasingly closer to reality.

I’ve learned a lot about making intelligent projections from my basset hound. No, Tilly does not have an MBA, but watch her track down a delicious treat and you will understand the strength of the guess and adjust approach. Scent hounds like Tilly will follow what scientists call a scent cone. A treat left out in a field will give off a smell that spreads downwind forming a cone. When first catching the scent, Tilly will guess at a direction and waddle over, nose to the ground. She will inevitably hit one edge of the cone and double back before hitting the other, zigzagging in tighter and tighter turns to the tip of the cone where the smell originated. What’s the lesson? Your first estimate may be way off, but each adjustment will get you closer and closer to a solid projection.

If the guesswork still scares you, start with something that you know: The number of tables at your restaurant or the price of a men’s haircut at your salon. These concrete numbers will serve as jumping off points and will help you check how realistic your projections are. Next, make some basic assumptions about those factors you don’t know. Finally, look at a short period of time – say one week or a day –and extrapolate from there. For example, an aspiring hair salon owner thinks he can bring in $20,000 worth of business per month. How realistic is his initial projection? Let’s start with what he knows. The salon can fit 6 chairs, will be opened 6 days a week, and an average haircut brings in $20.

$20,000 a month / $20 per haircut = 1,000 haircuts per month to meet his projection
1,000 haircuts / 24 days = 42 haircuts a day on average
42 haircuts / 6 stylists = 7 haircuts per stylist every day

Is this realistic? An optimistic entrepreneur may say yes while a veteran business owner will acknowledge that things are seldom this clean cut (no pun intended). Seven haircuts per stylist on a beautiful summer Saturday may seem easy, but what about a rainy Tuesday? Not to mention the times when we can expect to be understaffed. Following the Tilly method of financial projections, the salon owner can now adjust his prediction and check again, knowing that he is that much closer to an accurate estimate (or at least a piece of bacon in the middle of a field).

Manuel Dominguez is the Director of the NYC Business Solutions Centers in Brooklyn. If you have a question or comment for Manny, drop him a note below. And, please share this blog entry with your colleagues on Facebook and Twitter.

Lower Your Monthly Energy Bills Businesses often say, “I would like to open or expand my business...

Thu, 26 Apr 2012 10:03:24 -0400

Lower Your Monthly Energy Bills

Businesses often say, “I would like to open or expand my business here, but it is so expensive. Operating costs are too high. Monthly expenses pile up. Bills need to be paid. How can New York City help me offset some of these costs?”

New York City can help. One of the most successful and popular incentives is the Energy Cost Savings Program (ECSP). Its impact is direct and results in real savings for businesses. ECSP can reduce regulated energy costs up to 45% and regulated natural gas costs up to 35%. The benefits last for up to 12 years (8 years followed by a 4 year phase-out period).

Businesses are eligible for ECSP by either relocating or investing to upgrade their buildings. There are various avenues to access the program:

Moving from outside New York City into the City
Moving out of the targeted pressure areas of Long Island City (Queens) and Fulton Ferry (Brooklyn)
Moving from Manhattan south of 96th Street to other areas of the City
Renovating or constructing commercial office or industrial property and seeking real property tax benefits through NYC’s Department of Finance’s Industrial and Commercial Abatement Program (ICAP), or assistance through the City’s Industrial Development Agency (NYCIDA)
Leasing and renovating space in property owned by the City or State of New York

It’s a good rule of thumb to apply to ECSP early in the process before any building permits are issued or new leases signed. Specifically, if a business upgrades its space in excess of 30% of the property’s assessed value, it could enjoy both breaks on real property taxes and lower energy costs. For example, a building assessed at $500,000 would need to make an investment exceeding $15,000. Specific filing deadlines and benefits schedules apply. In most cases applicants file prior to the issuance of a building permit, or prior to signing a lease or purchasing a new site.

Unique to the ECSP is the creation of Special Eligible Premises or “SEPs.” These are buildings, which have previously undergone capital improvements, and approved by ECSP as eligible to provide lower energy costs to qualified commercial and industrial tenants. It has become a great attraction tool to keep especially small businesses in the City. To qualify a business must decide to remain or move to NYC and lease space within a SEP.

ECSP also provides one of deepest “green” benefits -by encouraging businesses that use natural gas to make their own electricity through installing a “clean” distributed generation (cogeneration) system. ECSP has an emissions test to ensure only the most efficient and sustainable “cogen” units are installed within the boroughs. Compared to the standard ECSP rebate, an additional benefit of 4.44 cents / kilowatt hour is available to businesses which install a “clean” cogeneration system. When a business can convert excess unused energy to usable electricity it helps relieve the City’s electric grid and can further lower electric costs for the business.

ECSP has been used by an array of businesses to keep costs down including one of the nations’ largest bakers and suppliers of Asian specialty food products. This firm produces such items as Chinese noodles, fortune cookies and eggrolls – right in the heart of Brooklyn. We provided energy benefits for two of its locations valued over $250,000 a year. In addition to ECSP, the firm also qualified for property tax abatements and a training grant to teach existing staff new skills needed to grow capacity.

A smaller firm that manufactures customized tools and precision instruments needed to move out of very cramped quarters adjacent to a residential neighborhood in Brooklyn – the best site for a machine shop. ECSP, when combined with additional State and City programs, encouraged the firm to move within the City and invest in a state of the artfacility–saving the business close to $50,000 in energy costs each year.

NYC Business Solutions and the ECSP team work closely with the New York State’s Energy Research and Development Authority (NYSERDA), ConEd’s Green Team and National Grid to promote additional efficiency programs to businesses finding new ways to lower costs and use less energy.

NYSERDA’s Commercial/Industrial programs provide energy efficiency services for existing buildings, new construction and industrial facilities.

NYSERDA’s programs include:

FlexTech Program: FlexTech provides cost-sharing up to $1M on technical studies to identify and encourage cost-effective energy efficiency measures
Energy Audit Program: Provides free energy audits to small businesses and not-for-profits with an average electric demand of 100 kW or less to help them make implement energy-efficiency strategies
New Construction Program: Provides assistance to incorporate energy-efficiency measures into the design, construction, and operation of new and renovated buildings
Existing Facilities Program: Offers incentives for a variety of energy projects including Pre-Qualified Measures and Performance-Based Incentives
NYSERDA AFV Program: Provides financial assistance and technical information to encourage businesses to purchase alternative-fuel vehicles

In addition to NYSERDA, the local utility firms offer additional incentives to promote energy savings. National Grid has a variety of programs including the New Construction Program, which offers financial incentives to defray costs of replacing old equipment or renovating space for large commercial customers. The equally popular Small Business Program helps businesses lower costs and improves energy efficiency through services such as lighting and heating. ConEd has its own newly rebranded Green Team offering its customers several programs such as the Commercial & Industrial Energy Efficiency Program, which gives cash rebates for installing energy efficient electric and gas equipment. There are free energy surveys, free thermostats, and up to 70% rebates for lighting, heating and cooling upgrades.

If a business is willing to commit to growing in New York City by either relocating within the City or modernizing its space, the City and State can provide programs to lower your monthly energy cost and reduce energy usage - both for the short term and long term. NYC Business Solutions has a team dedicated to helping you access, apply and determine eligibility for ECSP. We work closely with local utility companies like ConEd and National Grid to identify candidates for the program as well as to ensure smooth and consistent delivery of ECSP rebate over the 12 year life of the benefit. We can help your business access not only ECSP but the full portfolio of energy incentives designed to lower costs. Moreover, you can learn how the various programs work best together - to help maximize savings.

To learn more about these and other incentives programs call 311, or go to the Incentives Estimator on NYC Business Express.

Leave Don a comment or question below. And, please share this with your network in Twitter and Facebook.