Ventura Partners Hits the $1 Million Revenue Threshold

This article is written by Kim Frentz Edmonds, CEO of Ventura Partners

I have an addiction to reading business books. Girl’s Guide to Building a Million Dollar Business by Susan Wilson Solovic was always high on my list. However, the idea of MY own business hitting a million dollars in revenue seemed as fantastical as aspiring to become the next Oprah. Through my work with Darlene Crane and the PROPEL Small Business Growth Program*, I was able to modify this perspective. My new mantra – hit a million dollars in revenue and employ 10 or more people to move the business to the next level.

Ventura Partners is an organization with a mission. Our work creates opportunities for equitable ownership of community assets in real estate. It hasn’t been easy to center the financial growth of my own company within this framework. Darlene helped me internalize the view that growing businesses owned by women and people of color is vital in shifting the power dynamic in our society. This opened my mind to include my own business growth as a meaningful act.

In 2021, we reached the $1 million revenue and staffing threshold (10 employees). My company changed from being an extension of me to being an entity of its own. Our business structure allows others to grow and assume critical roles. We have established a Leadership Team to take on planning and strategic decisions. We have measurable financial goals and a specific plan for meeting them. We have metrics to make sure our pricing supports the value of our work and have streamlined our billing system to capture revenue and manage cashflow. We are outsourcing parts of our overhead that don’t yet warrant in-house staff.

I am still adapting to decision making through this new lens. I am allowing myself to delegate relentlessly. And, while I am still a bit uncomfortable that there are projects at Ventura Partners that I know very little about (because someone else is in charge of them), I remind myself constantly that this is not only fine, but important to the growth of the company.

One of my proudest moves recently was hiring someone who was an independent consultant and “competition” in our field. Not quite rising to the level of “mergers and acquisitions” (except in my own mind). It was instrumental in my ability to hand off high level projects that previously could only be accomplished by me, and it has expanded our network of clients.

I attribute our increased velocity of growth over the past four years to my shift in focus and mindset and implementing important organizational structures. I am enjoying the prospect of winnowing my role in the company to activities that hyper leverage my strengths and feed my interests … and I’ve adjusted my reading list, too.

Additional questions from Darlene:

What strategies did you use to get through the pandemic?
We shifted sales efforts when the forces on revenue shifted. We have a wide range of commercial property related services. So we shifted in the 2008 recession and through the pandemic. We shift to development projects, property management or strategic projects. Right now, non-profits are investing funds in the future.

What is the future direction for Ventura Partners?
Not doing things that are distracting to our primary mission. Being hyper focused on things we do well. We stick to a 30-day on-boarding process for new projects, developed better systems, and pay employees well.

*PROPEL Small Business Growth Program by Alliance for Community Development. The program’s focus is to build capacity in local community members, training local entrepreneurs who identified as women, people of color and veterans to bring their vision to fruition. The program was delivered in Oakland, California from 2013 – 2015.

The CraneWork’s Approach to Value Creation

When I ask business owners what they want in the future the answer I frequently hear is, “I want more money!” My response is, “The value of a business can be way more than money in checking and saving accounts.” Value is not one number. Value is a perception by industry professionals or an emotion customers feel about a product or a company. I looked up the definition of value on Visual Thesaurus which uses visual maps to define words.

The range of words included in the visual definition of value were:

  • Appraise – Measure – Evaluate
  • Worth – Economic value – Treasure
  • Prize – Esteem — Respect

Value of a business can refer to the sales prices of a business. Valuing a company for sale is a complex process. The customer base, annual sales, customer lists, profit, physical assets, products, intellectual property, location and local household incomes are considered in estimating the sales price of a business. Companies specialize in evaluating these tangible and intangible value elements.

The CraneWorks looks at value as a creative process across the whole company. Efficient operations with low costs are important to aim for. But what must the company invest in products and quality to satisfy customer needs and quality? To answer these questions understanding the emotional elements of building a value creation mindset across a company is important. In the current environment, consumer purchases are emotional and shifting rapidly.

Consider the desires of customers below. Which product do you think will have the highest loyalty and demand?

  • I want a pizza NOW – The nearest pizza joint will do
  • I spend money to get things I treasure – I only buy Rolex watches
  • I come back to my neighborhood restaurant — It reminds me of home

To answer those questions, look at how the whole company responds to customer’s desire to buy. The effort reveals ways to reduce costs and where to invest funds and resources to improve customers’ decisions to buy. Right now, holding customer attention is key to improving the revenue line, the life blood of all companies.

Multidimensional Solutions for Small Business Sector

Just because businesses are small does not mean they are simple and easy to fix.  Small business owners, especially the vast majority that are at micro-level, are individual dynamos.  They are workers, managers, executive decision maker and frequently local business leaders.  Their businesses create jobs, hire contractors, pay suppliers for goods and services all to satisfy demanding customers.  Each business has its own ecosystem which creates value for the company and the local economy where they operate. 

To limit the loss of value in goods and services that communities will lose if we let thousands of small businesses close will require more than just loans.  Systemic solutions are needed on three levels.

  1. Help small businesses do more than stay afloat without adding further debt.  In consumer service industries like catering, hospitality, travel fundamental changes are required for these businesses to survive beyond the Covid-19 pandemic.  We need more creative use of grants, zero interest loans or forgivable loans are needed to fund business restructuring or reinvent costs to business owners
  2. Invest in the developing local business ecosystems across business districts and regions.  It is not enough to just focus on Business improvement districts and the needs of property owners and business owners.  Business owners are a vital segment of supply chains, educational systems for hiring and a source of distinctive goods and services to the community.  Now is the time to bring all the silos in local economies together to rethink the support structure for small businesses.
  3. Small business owners are people with families, not corporate entities with legal structures and big cash reserves to protect them in economic downturns, let alone a public health crisis and deep recession.  Survival of decades of commitment to operating local restaurants, retail stores, etc. are demands constant attention and drains personal assets and resources too often.  I am pleased that the Aspen Institute and the Stanford Latino Action Network is encouraging research into the condition of business owner families.  The research is focusing on financial condition and benefits like health care and unemployment insurance.  The results are that the law protects employees and owner families frequently have few benefits of their labor than their employees do. 

    Transfer of management and ownership across generations is rarely considered in small business circles.  This transfer of family power, decision making authority and  management of financial resources is a complex social, psychological as well as business and legal process.  The transfer of wealth to future generations especially in immigrant and lower income communities is vital to the health of the business district.  When we lose businesses that have been job creators for decades in ethnic communities the blow is severe.  Services to businesses need to go beyond just business, financial, operating management and formal exit planning.  Family and multi-generational wealth transfer and community health are at stake.

Multi-disciplinary and multi-cultural mindsets are needed to develop innovative and outcomes-oriented solutions are required to sustain the U.S. small business sector  which generates close to half of Gross Domestic Product with extraordinarily little support beyond loans and financial and business advising.  Imagine what the contribution of small business could be to the economy with comprehensive and multi-dimensional development and creative funding!          

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