BUSINESSES TAKE ROOT; VICTORIA'S GARDEN FERTILE GROUND FOR BURGEONING VENDORS.

Byline: Enrique Rivero Daily News Staff Writer

When the flower shop where he worked closed last year, Luis Melara didn't know how he would earn a living and support his wife and two children. All he knew was that he wanted to continue working with floral arrangements.

Then the Granada Hills resident heard about Victoria's Garden, a Burbank-based incubator for small businesses. About a year ago he set up Flowers by Luis, a small silk flower design business, in the 2,200-square-foot Magnolia Boulevard establishment.

He credits Victoria's Garden and owner Victoria Butler with helping him learn the rudiments of small business ownership as he prepares to open his own store.

``Right now I'm looking for the space,'' said Melara, 23, who meanwhile also manages Victoria's Garden. ``If everything goes fine, by the end of the year I'll have a store.''

Butler opened Victoria'a Garden in November 1995 as a place where budding entrepreneurs could cultivate their skills and transplant them to a place of their own. She wants others to avoid the mistakes she made about 10 years ago when she opened a beauty salon in Riverside with her mother and daughter - and failed miserably.

``I felt this could be a place for people who could get started without the trauma, without the stress,'' said Butler, who has worked as a counselor and also runs a leadership program out of Victoria's Garden.

Her incubator offers support such as classes, suggestions on pricing and displays, and access to wholesale houses.

``Anything that helps them get ahead financially, I encourage them to do it,'' Butler said.

Although publicly funded business incubators are fairly common and frequently quite successful, privately run incubators such as Victoria's Garden are rare, said John Rooney, president of the Valley Economic Development Center Inc. VEDC is primarily funded by government grants.

Most business incubators are set up by economic development groups, real estate developers, universities, cities and counties, and are typically funded by the federal Department of Commerce, he said. They help businesses flourish by providing access to venture capital, consultants and other market opportunities, he said.

``It becomes more of a total support system for growing a business, and there's a real need for those in the Valley,'' Rooney said.

At Victoria's Garden, entrepreneurs can lease space for $75 a month and must work in the store a minimum of two hours a week. Those who can't make the rent can work it off by helping out around the store, she said.

But it's not all roses in the garden. Ann Larkin, who sold jewelry she designed at Victoria's Garden, said she encountered frequent and unexpected changes in the rules, broken verbal agreements and other problems.

For example, she said she was, at times, asked to clean the facility and help customers who weren't hers; tasks that took away from the time she was supposed to spend designing jewelry in a room she rented from Butler. Also, Larkin said she could never convince Butler to commit to anything on paper.

Since leaving, Larkin said she's encountered others with complaints that often echoed her own.

``I would not recommend starting out there if you are very inexperienced,'' she said. ``You need to go into a place where it's written down in black and white exactly what the situation is.''

But Butler said she doesn't arbitrarily change the rules. She said her 1-1/2-page contract lays out the rent, minimum hours and other requirements. Still, she's willing to change rules to help an entrepreneur.

``I don't have any hard-and-fast rules - just pay the rent, because I have to pay the rent,'' said Butler.

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Photo: (Color) Victoria Butler opened Victoria's Garden as a place where budding entrepreneurs could plant and grow new businesses.

John Lazar/Special to the Daily News