Saying goodbye to corporate America.It takes a lot of guts to start a company in an industry where the leading brand is about as American as apple pie. But for Ronald Damper, the drive to leave corporate America and start his own tea company was stronger than any cup Lipton could ever brew. The 44-year-old former Citibank vice president spent most of his 15-year career in financial services overseeing multimillion-dollar finance deals for items ranging from super tankers to aircraft fleets. When Citicorp wanted to transfer him from Chicago to New York, he stayed in the Windy City and took the plunge into the tea business. Today, his dream company, Damron Corp. of Chicago, produces the house blend for 95% of McDonalds's restaurants throughout the country. Started in 1984, Damron and its affiliates (which include Alemeda Products Inc. in Butler, Pa.) now boasts $5 million in annual sales. Every day, Ronald Damper's story becomes less of a unique tale to tell. Whether they walk out with pink slips in hand or find their own way to the door, a growing number of managers and executives are leaving their companies without even thinking about looking for another job. Their ambitions are taking them elsewhere: entrepreneurship. Although this trend is still too new to be reflected in statistics, Edward D. Irons, dean of the business school at Clark Atlanta University and a member of the BLACK ENTERPRISE Board of Economists, sees a distinct restlessness among black MBA's in corporate America. "I sense a strong urge to move out," says Irons. "The impetus for some is the glass ceiling; others just want to make more money." Taking The Plunge Linda A. Hill, an associate professor at Harvard Business School believes in the "less-is-more" business philosophy now gathering speed. Whe thinks that this till the major force propelling many professionals to alter their career expectations, even before the ax has fallen. "In the past, just about anyone who was forging a career in business or industry could rely on the system of vertical mobility, salary increases and higher titles as markers to gauge their success," explains the corporate management specialist. "But lateral movement is a wave of the future. In many businesses, the opportunities for advancement are going to be limited. Some people may be satisfied with just having more responsibility, but for others, entrepreneurship will be more inviting because they would rather move out than move over," adds Hill, author of the recently released book, Becoming A Manager: Mastery of A New Identity, (Harvard Business School Press, Cambridge, Mass., $22.95.) As more companies trim the fat to fit today's corporate ideal--"lean and mean"--the cost-containment ax seems to be falling more heavily on blacks and other minorities. While it may seem as if blacks are losing ground on the corporate landscape, small gusiness advocates believe there may be an upside to the backslide. "The layoffs could be the catalyst for more start-ups by college-educated and corporate-trained African-Americans," says Dolores C. Ratcliffe president of the Association of Black Women Entrepreneurs. Clark Atlanta's Dean Irons agrees. He believes that now may be a good time for fledgling entrepreneurs. "The trough of a recession is certainly a better time than when the economy is going down," he says. Irons adds that the main advantage to starting out in a slow climate is that the new entrepreneur has time to hone his skills and work our the kinks before launching his or her own business. Rapid expansion and the lack of clear management goals and objectives were two of the major problems faced by fast-growth business created in the go-go '80s. Furthermore, exchanging bureaucratic corporate decision-making systems for the entrepreneurial "seat-of-your-pants" management style added to the start-up woes of many failed companies. Fortunately, a solid core of new entrepreneurs is determined not to repeat the mistakes of their predecessors. Banking on the skills and talents that brought them success on the corporate front, these men and women are gearing up for the entrepreneurial hustle before they walk out the door. Leveraging Contacts And Financing Know-How When Damper left Citicorp, the banker knew nothing about the tea-blending business. It was a McDonald's insider who told Damper that the fast-food king was looking to expand the number of its minority vendors. Another contact put him in touch with the president of Victor Coffee & Tea Co. the Boston-based beverage company, where Damper would spend a nine-month apprenticeship mastering the tea-blending and packaging business. But contacts weren't enough. Damper's biggest challenge was money. He only had $1,000 in start-up money for his new venture. Undaunted Damper relied on his experience in leverage-leasing deals to keep his plans brewing even when the banks turned down his requests. Instead of waiting for financing to buy Victor Coffee's tea division, Walker arranged to pay the company a $4,000 monthly administrative fee plus packaging costs to pack and ship his tea blend to McDonald's. "I give McDonald's a lot of credit for going along with that plan; they were supportive in helping me find a solution to the problem," says Damper. Once he had a track record as a McDonald's vendor, the former bank vice president was able to secure bank financing for his own equipment. Choosing to start his own company in an industrial incubator in Chicago, Damper passed on the opportunity to buy the Victor tea division. There he was able to share the cost of rent and office services as well as tap into technical assistance provided for the fledgling companies. Damron's Chicago operation is a 50,000 square-foot facility on the city's West Side where 25 employees process and bag leaves for single serving and multi-portion brewing. Planning To Take The Plunge Planning and research were Cynthia Walker's tools for the successful start-up of her medical, technical and computer equipment leasing buisness six years ago. A former sales representative and division manager with the pharmaceutical giant Johnson & Johnson (J&J), Walker spent weeks in the business section of the local library researching the trade by working with two large leasing companies as an independent representative. In 1986, Walker launched C.W. Leasing Inc. from her kitchen table. Playing on a hunch, Walker believed that the market for leasing would grow as technological improvements outpaced the consumers' ability to replace their equipment with each new advancement. As the economy turned downward in the late 1980s, her Los Angeles-based business boomed. C.W. Leasing currently boasts more than $2 million in annual sales and counts among its clients medical and dental offices, restaurants and banks. While at J&J, Walker, 49, rose from a sales rep to division manager in the company's health care poducts division. In her last position, Walker supervised sales that covered the company's Southern California territory. After more than 10 years, Walker left J&J because she felt her career there had peaked. "I didn't feel it would be any different at another company, so I decided to see what I could do on my own," she explains. Leveraging the marketing skills that she developed at the New Brunswick-based health care company, Walker continued her practice of showing prospective clients how they could improve productivity, better compete and use tax breaks through leasing deals. While Walker and Damper acknowledge the rough side of going from employee to entrepreneurship, they profess nt to miss the perks of corporate life. "Sure there is more responsibility in being on your own, but my only regret is that I did not leave sooner," says Walker. When Ideas Pay Off Unlike Walker and Damper, many new business owners are realizing that leveraging their corporate experience and qualifications isn't always easy. No one knows this better than Arthur Queen. Nineteen years in the glass installation business did not help him find a new job after he and his wife moved from Washington, D.c., to Atlanta six years ago. "I got the same response in each interview, you're overqualified," says Queen. Queen quickly learned that the few companies that were hiring were willing to settle for younger, less-seasoned workers rather than pay for experienced management skills. With his wife's support, he used the $15,000 profit from the sale of their Washington home to start Ebony Glass & Mirror Inc. in 1986. Today, Ebony is among the leading glass installers in Atlanta, specializing in glass curtain walls, insulated windows and doors. Queen is quick to credit local business-development agencies and minority set-aside programs for boosting his company from a mom-and-pop auto glass installer to a major player in the construction-bidding process. "The construction business in Atlanta works like a club. Construction managers give work to the people they know," says Queen, who sought entree through agencies like the National Association of Minority Contractors and the Georgia Minority Supplier Development Council. It too, intense lobbying, but his persistence paid off. Ebony Glass now boasts among its projects the Stouffer Concourse Hotel at the Hartsfield Atlanta International Airport, the Georgia Dome, Grady Memorial Hospital and the expansion of Underground Atlanta--a complex of shops, restaurants and nightclubs that is one of the city's leading attractions. Queen continued to expand his company by proving that he and his installers could handle sophisticated construction jobs, such as glazing and curtain wall installation. "I just kept pressing for the better jobs," says Queen. Since 1985, with first-year revenues of $65,000, Queen has taken his company to the $800,000 level. With the 1996 Summer Olympics in Atlanta, Queen is looking to hit the $3 million mark by 1995. Born For Entrepreneurship It took unemployment to push Arthur Queen into entrepreneurship. But now emerging is a generation of young black professionals who do not necessarily cherish lifelong careers in the corporate world. Many are using their corporate jobs as springboards rather than professional perches. Marcus Butler, 33, put in just two years a marketing manager with J&J in Pittsburgh, before quitting to start Butler Express Inc., an interstate collegiate transportation company. The company operates weekend van services between college campuses throughout Ohio. "Things were going well for me at Johnson & Johnson," says Butler, whose idea for a campus-to-campus shuttle service crystallized while he was a business student at the University of Cincinnati. "It was never my intention to stay with J&J, or any other company for long. My plan was to pick up some management experience, save some money ad then go out on my own." Butler decided it was time to put his idea to the test after reading that the percentage of Ohio high school graduates who were staying in state for college was on the rise. The reason was economic. Today, Butler Express Inc., whose fleet of nine vans serves 13 campuses throughout the state and one in Michigan, reports annual gross revenue of more than $300,000. But it was a bumpy ride to profitability. One rude awakening Butler recalls, was the difficulty he had in securing a small business loan. Although his business plan--detailing extremely competitive pricing strategies especially against larger companies like Greyhound--was well-received, Butler claims that he "must have seen every banker in Cleveland before I found one who would take a chance on us." The $25,000 bank loan and the $15,000 of his own capital from personal savings was enough to start the engine of his transportation company. However, the capital only covered the costs of his first two 17-seat vans and the initial marketing budget. Since the money could not stretch to pay drivers' salaries, Bulter and his wife, Dr. Lynda Butler, who has her own dental practice, took the wheel. The next hurdle was finding and holding onto dependable employees. "It's one thing for someone to look good on an application or make it through a driving test, but juding whether a driver can handle a route is another matter." In hs business there is no room for compromises. "If you cannot provide safety and services each time out, your business will go down the drain," Butler explains. As owner of a transportation company, which in Ohio falls under the jurisdiction f the Public Utilities Commission of Ohio, Butler must also keep abreast of current licensing and liability insurance issues. Butler's campus-to-campus service is limited to weekends. But his vans are not idle furing the week. Butler shuttles high school students to and from midweek athletic activities. Like many minority entrepreneurs, Zelda Turner looked to franchises as a way to launch her business. But instead of buying into a traditional fast-food franchise venture, Turner found what could be called a new-age opportunity. Last year, she opened the first Illinois franchise of FUTUREKIDS, a Los Angeles-based computer-literacy-training company that focuses on children. Turner, a 39-year-old former computer analyst in the computer technology division of C.N.A. Insurance Co., left the company after 10 years when her aspirations no longer meshed with the compay's plan for her. The start-up cost for Turner was about $22,500, which primarily covered the $15,000 franchise fee, computer equipment and furniture. Turner used personal savings and a settlement from a personal injury suit to open her business. When it was time to set up shop, Turner bypassed spaces in central locations such as Chicago's Loop, for Lincoln Park, a residential neighborhood in Chicago's northside. "Lincoln Park is mostly made up of professional couples. Families in this area would probably be my best client base because young professionals understand the importance of computer literacy and have teh income to pay for its for their kids." Open six days a week, Turner offers computer tutoring to youngsters as young as 2 1/2 years old and up to 18 years. Turner's session run about two months at a time with prices ranging from $60 for toddlers to $100 a session for students from ages 12 to 14. With 25 youngsters currently enrolled in her program, Turner is signing up new students at a rate of about five or six a month since January. So far her business has not turned a profit, but she expects to be able to pay herself a salary by midyear. Fueling this drive to succeed is the fact that she (like many of America's newest entrepreneurs) realy enjoys her new business. When searching for business opportunity Turner asked herself two questions:" 'What is my main skill? And what do I enjoy doing the most?' I decided that the ideal business for me would combine my knowledge of computers and the pleasure I have found in teaching. So far I think I made the right choice." |
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