« Exchanges at Goldman Sachs

Small Business in the Big Easy: Powering an Economic Revival

2015-08-26

Dina Powell, head of Goldman Sachs' Impact Investing business and president of the Goldman Sachs Foundation, discusses how investing in the New Orleans small business community has helped to revitalize the city. She is joined by two graduates of the Goldman Sachs 10,000 Small Businesses program: Kristen Preau Moore, CEO and owner of Cook Me Somethin' Mister, and Barrett Wiley, owner of Cleaning Concierge.

This episode was recorded on July 28, 2015.

This podcast should not be copied, distributed, published or reproduced, in whole or in part. The information contained in this podcast is not financial research nor a product of Goldman Sachs Global Investment Research. Neither Goldman Sachs nor any of its affiliates makes any representation or warranty, as to the accuracy or completeness of the statements or any information contained in this podcast and any liability therefore (including in respect of direct, indirect or consequential loss or damage) is expressly disclaimed. The views expressed in this podcast are not necessarily those of Goldman Sachs, and Goldman Sachs is not providing any financial, economic, legal, accounting or tax advice or recommendations in this podcast. In addition, the receipt of this podcast by any listener is not to be taken as constituting the giving of investment advice by Goldman Sachs to that listener, nor to constitute such person a client of any Goldman Sachs entity.

Copyright 2015 Goldman Sachs. All rights reserved.

This is an unofficial transcript meant for reference. Accuracy is not guaranteed.
This is exchanges of Goldman Sachs. Were people from our firm share their incites on developments currently shaping markets, industries and the global economy? On Jake's you on have corporate communications here at the firm today, I'm joined by Dena PAL, who is president of the Goldman Sachs Foundation and head of our impact, investing business willing to discuss community development in small business finance and how its being spur and economic revival in New Orleans, Dena welcome to the problem donated to meet her. in order to focus today on one of the problems that you oversee, and that is ten thousand small business Particularly the impact is had new Orleans. We ve been operating for some time. a little bit about how the foundation came to focus on small business and what we try to do with that problem.
Sure well over the last several years. We have really believe that the best investment Goldman Sachs can make through our foundation is empowering entrepreneurs to reach their potential when they do the best drivers of economic growth and job creation and thousand small businesses is a program co chaired by our sugar, Lloyd, blank, fine Warren Buffett, Michael Porter of Harvard Business School and Michael Bloomberg. They have really pushed us to think about what it is that grows small businesses, and we believe that the secret sauce is bringing together business, education, access to capital and technical assistance. Nowhere has this been simplified more than in New Orleans, a city that obviously suffered great devastation and is now the best labs of entrepreneurship in the country we ve worked with over three hundred business owners, some of them family business. said some of them new businesses. These were business owners who had the passion, have the drive, had the great businessmen
They just needed some support to really go to the next level ensued. a little bit about the education opponent. What is that we're trying to help the entrepreneurs solve for and how the programme, actually work. This is really a growth business programme. by that I mean we are focused on existing businesses who believe that with the right support they can scale both in terms of their workforce their revenue, growth and their impact in community. So through Delgado commuted, college. In New Orleans we ve been able to implement a very pragmatic growth business curriculum elements of it include She should access to capital, leadership, financial planning and what found is that this Batson created curriculum, which is the number one entrepreneurial com Now around the world is really help business owners asked the question: where do I want to be in five years and that sort of the central question that you hear from our business owners for chicken? in New Orleans where there was great challenge
others enormous opportunity. There's a robust small business community. We think that the educational peace delivered by community colleges and our country can really help these business owners get the knowledge they need to grow amuse her successful business owners already that's are looking to scale. That's right! So I their businesses that have been operating for at least two years have at least for employees, have really already proven the business model, and now, in many cases they ve had a plateau. Some than by the way our family businesses passed down three generations and if you really provide them with pragmatic business, education, access to capital and technical assistance through advising from Goldman Sachs professionals and local business advisers, that is really what propels them to reach their potential. So talk a little bit about the challenges facing small business today when the kinds of challenges there facing into these, you can almost sure when we think about economic growth in our country, small businesses,
are central to the agenda, but they do face a lot of challenges. The first is they tend to be silos. You know it's a lonely thing being a small business owner you're. Trying to me payroll your managing your staff you're looking for growth opportunities, so I think one of the things that this programme addresses is building a network of small business owners. We were so proud to see that the cohorts that come together actually end up doing business with each other. So seventy five percent of the graduates of ten thousand small businesses actually do business together and have created. Get place. Access to capital remains a challenge, so that was one challenge we really sought to address. When you graduate from ten thousand small businesses, you actually hold in your hand the most important thing that you can have when you're applying for alone, which is a growth business plan, that's been reviewed by Goldman Sachs Business adviser or a volunteer from Goldman Sachs and so taking up business plan.
with Syria, five to a bank, really makes the case that you know where you want to go with your business and why you need the capital to get there. So we ve had these programmes, benchmarked and studied babes in college, which is very respecting the space, did a study on the impact of ten thousand small business. What was most striking do about the findings of that report, which was loose recently. First of all, this is really particularly interesting data, because this data is eighteen months after the businesses have graduated. So we back the business owners from baseline when they get into the programme at six months and then an eighteen months obvious. We are very pleased to see that the growth continued with these business owners. Sixty seven percent of the participants reported increasing their revenues just six months after graduating, and then forty six percent
reported, creating net new jobs and we were able to actually validate this data. I would say the numbers that continue to inspire us are the graduation rates and the market place creation. So ninety nine percent of handouts and small business programme participants nationwide complete the programme which is any compelling, because these are very business people of Digital Bambeday jobs. They don't even people to do the jobs they already have. They have to take forty six months of every other Saturday, doing these modules plus clinics plus right that growth business plan that they have to have to graduate, I think about it, tells us is that there is real value in the programme. Do you know that them ten thousand, while business is really all over the United States now and a kingdom, but why, New Orleans noise, but a big focuses problem for a long time, and why, Have we been so happy operating there when you are and is an american city that so many people care deeply about, and certainly our own people at Goldman Sachs after Katrina were eager to go
when volunteer and help after the tragedy, but over the years we ve actually invested more than two hundred million dollars in invest in community revitalization in New Orleans. So we ve had a long history and along love of this of New Orleans? The other Our main reason is that this programme operates most effectively when you have strong local leadership. The leadership of Mayor Mitchell Andrew Delgado Community College bill buying them, who runs hope, enterprise we believe as one of the best pdf eyes in the country. We really felt that there was a strong ecosystem, that we could really invested. to deliver this programme and to make sure that it was very effective. Do you know joined by two very special gas, were fortunate to have with us today, Kristen Pro. more? The c o in honour of cook me some, MR and Barrett Wily, the honor of cleaning concierge. They both graduated from and thousands, while business programme in New Orleans Christian and bear it welcome to the programme. Thank you. Thank you very much
so. We are limit from Dena about the small business community in New Orleans and as to people live there every day, talk a little bit about what it's like to be an entrepreneur in New Orleans tonight. What are you in New Orleans today is so much were it not only from Pre Katrina, but from Ireland's thirty years ago I grew up in a family. Business model An entrepreneur and heat tells me every day Christian. If I had the resources like you have today to build it this in New Orleans we would be in a different place today, so that sticks with. And I take advantage of every opportunity. It's almost like the red carpets, been rolled out first, businesses in New Orleans. And the environment for small businesses Is now one that he knows about inclusion and no ideas is off the wall. If you have an idea explore it, may not. An opportunity, for you may not be a business, but you have some resources There was the acoustics before
its imagination. They want to work. and you might have hedge on business, but it was always doing things exact same way. There was no challenging am I doing the right we can. I do about it. How can I do a different knows questions. It was this ground how this day in day out do the same thing. My kids take over he's, wonderful, exacting where do it, but now it's I think I can do about it. It's trying to intervene even this up in a small is changing the method when you can trust, business, transform your thinking about your business, about things in general. So why don't you start business the business because implore myself- and I don't want anyone to control, it wasn't me or my ears, but if I think us, where is my fault by reward Podsnap had they can adapt, but then I started. My business other different business came at that clean the house, my wifi anniversary,
and I used to cleaning products, and I can take that kind of with traditional crane. I had to go outside and take a breath start a research and green cleaning and came back a week later cleaned out when I owed its work. It is option and then just snowball from there very interesting prison. Haven't you hide why'd, you start your business. My business is my passion. It's my sorry, it's kind of a combination of a lot of experience him. I've never considered myself to come in here and be a food manufacturer, but I grew up in the food business. My initial product, Is a jungle. I rice mix that we package in New Orleans Workin wish a pauper down so around this environment, and the business idea came to me during Hurricane Katrina. I was back. He waited ends do something to help had we're gonna equipment with me, and I do it. We always do best when we need to help out I've started Cook in general. I it and we ended up traffic
tree, I put together tailgating fundraiser on fresh out of college, not knowing what my future holds and went college universities and cooked my dad's recipe and end up raising a hundred thousand dollars for the recovery effort in New Orleans and in that moment, when I saw the connection how much people really craving proving that New Orleans flavour and I knew something was there, took me get it altogether. But this is where I want to be as an ambassador for our city, our culture, and now I have my own some business to grow and bring that impact back to the city sober You started cleaning house your own house, are you move into schools and other institutions move the school there was other institutions was by progress. Our commercial cleaning then door commercial criteria was there before to increase our proper increase demand and try to get away from the basic janitorial. So is it now about a little more effectual? So there we saw postal shucks Ukraine as a growth opportunities granted
program? I was able to gain by disadvantaged business certification which allow me be eligible to bid on government contracts are some new high private contracts that, have city funding initiative by and then what's gonna happen got my Debbie certification through state. do the follow up to the new one is airport went to construction site knocking on doors and was able to to contracts claiming to schools, and I have come criminal schools at the moment, so talk alone, about the challenges you alluded to but the challenges you faced when you are starting the business from scratch No, I just starting the business are willing to take advantage of a lot of the resources locally me started. My business with assistance from the Small Business Development Centre and then I went on to working with Axion now lift fine and check out to the southern. U S: Trade Association, good work network meet that's one thing about this red carpet. There are so many partners in the city
come together and it was my business Alt and Diana School Fanny. She also comes from the food industry. In New Orleans, her family instituted a school of cooking for New Orleans, She has been pushing me all the way following just had. A point is my fourth year in business when I applied to the Goldman Sachs Program that I haven't had a wall and serve I have on my passion and my drive and as experience of the head and retail and food distribution, and just got myself at that point, but Diane encourage me to apply for it Because I don't know where to go next, I knew that I can keep going, but I just didn't know what that next step was. There were so many ways I could have gone so thankful to be able to apply for that programme too. Help me answer those challenges on how to grow, I don't know what I had a diamond in Iraq and anyone realize it both of you talked about how the sea change a lot since Katrina ARM and become a mecca. Entrepreneurs, how's the city different
those of us who live there every day. How does it feel different ten years off? Do me a favor from because there's an influx of new ideas The culture and a soul in the waters is still there because the native people are still there. But now we have other people coming in with fresh ideas and in new ways of doing things. And now it's opportunity if you're as open, if you're open detained I reiterate that as well occurs baron and I both up in New Orleans we're both went to high school in New Orleans, and we see that change now. But the other thing I can speak too is just that eyes and everyone just craving that peace in New Orleans. Everyone craving that flavour of New Orleans across the world. and many a that is thanks to the efforts of the small businesses in the city. The government midlander, actually that's a part of his platform to issues promoting the culture of our city and unjust for that I naturally found that connection and their shoes. So many more channels now right place right time,
that I'm ready to help New Orleans export that culture and we have people from Australia that are our customers that are talking to us that they know and want out of. This is the family recipe from the world's. We want a piece of that. I want to help to deepen the connection with our city and with our culture. So what are the next steps? We are business, she opening ranch in Australia, while we are mean that I can say that we have already successfully started to distribute internationally and predominantly aren't distribution of family. Sixteen months out of the programme, we're still predominant cross the Gulf Coast area, we ve launched now on Amazon Prime and were growing with our current customers? Product line extend My daddy stumble, I'm gonna have a moment's gumbo soon and then, of course, even adapt to some of the fresh food options. My mission now too, is too bring in some healthier alternatives to traditional New Orleans food. So I have some product development and I realize that
only go so far and going from so many stories of my cast iron pot to promote our culture and our cuisine. But now I have teams of people that I believe in can reiterate what we represent. So that's can be big part of it, so hopefully I'll be up here again next year, with some distribution, some grocery for that we can get me nothin and similar products inveterate habit- you what's what's next few businesses, eczema businesses to branch out into water, restoration, remediation services, because again in the waters we have natural disasters Now the rain and the images the moist climate, so that indefinite help us get people back in their homes as fast as possible in businesses is where men, looking at brandy onto other markets. Lagging Southeast Louisiana opened up a little cases where you can see it. Did it some closing thoughts from you. What's next pretend out small business? How jack
see the problem grub. What this Friday marks an important milestone for ten thousand small businesses. We actually will reach the five thousand business owner and the programme this initiative. Is modeled. After our global programme, ten thousand women, which we started in two thousand eight- and not initiative. Once we started nearing reaching the ten thousand woman and we obviously seen the results the programme and transparently reported on those results. We were delighted when we had a chance to scale it with co investment opportunities and I think we're hoping to see how we can scale this programme to way beyond ten thousand with partners who want to coexist. With us around the country. The numbers are one thing, but the stories of entrepreneurs like Christian and bear it are really what keep us mode I did, I mean five thousand stories like theirs, which really makes you feel good about the american dream of screwed. Thank you so much for joining Us Christian, Barrett, stories are amazing
enjoyed having you here today. That concludes this episode of exchanges of Goldman Sachs. We hope you join us again next time seaward. Thanks for listening, this podcast was recorded on July, twenty Eightth, two thousand fifteen. This podcast should not be copied distributed, published or reproduced in whole or in part. The information contained in the spot cast is not financial research nor a product of Goldman Sachs, global investment research. Neither Goldman Sachs nor any of its affiliates makes any representation or warranty asked
accuracy or completeness of the statements or any information contained in this podcast, and any liability, therefore, including in respect of direct indirect or consequential loss or damage, is expressly disclaimed. The views expressed in this podcast are not necessarily those of Goldman Sachs and Goldman Sachs is not providing any financial, economic, legal, accounting or tax advice or recommendations in this podcast. In addition, the receipt of this pop cast by any listener is not to be taken as constituting the giving of investment advice by Goldman Sachs too that listener, nor to constitute such person. A client of any Goldman Sachs Entity.
Transcript generated on 2021-10-15.