Running a small business can be difficult if you don’t have the right resources for growth. Thankfully, in Maine, we have the Maine Small Business Development Centers to support our small and micro-businesses.
Peter Harriman, Center Director for the Maine SBDC is our guest this week, sharing how your small business can benefit form partnering with the Maine SBDC.
Rich: Our guest today is a certified business advisor at the Maine Small Business Development Centers at the University of Southern Maine here in Portland. He works with entrepreneurs and small businesses in Cumberland and York counties to start and grow their businesses. In the almost four years he has been with the Maine SBDC, he has spent 3,754 hours advising 797 clients. Very specific. Clients have attributed his help to assisting starting 71 businesses, create or retain 205 jobs, and helping clients access over 9.7 million dollars in capital. In 2018 he was awarded the annual State Star Award, and in January of 2019 he was promoted to Center Director of the Portland office. We’re very happy to have with us Peter Harriman here on the show today. Welcome, Peter.
Peter: Thanks, thanks for having me. I’m happy to be here.
Yury: Well, thank you for coming. Peter, could you tell us, how did you end up leading the Maine Small Business Development Centers?
Peter: So I worked with the Small Business Development Center for three years, prior to that I worked for the federal government. And the Center Director job came up, and I was able to fill that position quite nicely.
Rich: Pretty straight forward, thank you for sharing.
Yury: So who does the Maine SBDC work with? Should companies be in startup mode or fairly mature to get the most out of working with you?
Peter: It’s actually both. We do deal with a majority of small businesses that are just looking to get started, so entrepreneurs. That’s about 60-70% of our business. But the other 30-40% are people who are already in business, either facing challenges, growing challenges, or looking to sell their business, or they just need a checkup to see if their business is doing all right. So the answer is both.
Yury: Are there any certain industries that you focus on or have specific expertise in, or something like business to business, business to customers, online versus offline?
Peter: With the Small Business Development Center, we try to make sure all of the advisors have a nice core base. So in some sense we’re generalists, but each one of us does have specific specialties. For me, my wife is a speech therapist, so I have a good expertise in the medical field because I help her. So I understand some of the nuances of that. We also work very well together, and I’ll throw it out there, with SCORE our SCORE chapter, who is actually the top chapter in the nation.
Rich: In the nation, that’s awesome.
Peter: And we work very well together. So together we try to cover all the bases of just the general what a business needs, and that could be anything from business entity formation, what type of business do I want to start, projections, business plan, all the way up to, “Okay, let’s get specific about a restaurant.” But through our doors we see all types of businesses. We’re open to anyone, and we’ve seen everything.
Yury: Well, speaking about everything, what would be the most incredible type of business that you experiment with?
Peter: Incredible as in incredible successful, or incredible not sure the idea is going to work?
Rich: I think both ways, both.
Peter: It doesn’t sound very large, but there was an entrepreneur that came in who had a pretty unique challenge of – and all our sessions are confidential, so I have to keep it a little vague.
Yury: That’s fine.
Peter: But one of our entrepreneurs had a unique challenge of how to rent motorcycles. Right? So it doesn’t sound like a large challenge, but for an entrepreneur who’s, just a small guy, not like a Harley Davidson, the insurance proved to be pretty difficult. How do you get insurance just for a day for a motorcycle with someone who just kind of comes in off the street? What’s their driving record, how do we do this, how do we price this right, because if it’s too high, it’s not going to work. But they were able to do it and they’re successful, they’re renting motorcycles all around the state now.
Rich: That’s cool. Just to follow up on what Yury was asking, online versus off? I’m kind of curious, you know I came to the state of Maine back in 99, and there were just different companies, different workforce out there. Have you seen a shift, are you getting more requests from companies that are online first, or is it more like you still get a lot of traditional companies primarily? What has the shift been, I guess I’m asking,
Peter: We have seen a large shift in eCommerce, a lot of people who don’t want to open a storefront necessarily, especially just starting out, they want to kind of build up to that possibly.
Peter: But a lot of either service or retail that is completely no physical location, it’s all either virtual, so their online marketing, their website, is very important to them. And that’s been a big factor, and one of the reasons I go to The Agents of Change every year.
Rich: Nice plug.
Peter: Thanks. Because that part of marketing is changing so quickly, you have to keep on top of it if you’re going to be advising people on that,
Rich: And I know that you have a bunch of advisors working for you, or counselors. Do you start to pull in new people based on … Like you said, you’re seeing more eCommerce stores, so do you go out and find somebody who’s an eCommerce expert so that you have somebody you know that you can work?
Peter: Yep, exactly. When we look to hire new people for advising positions, we look for the broad skills, because all sorts of people are going to come in, but we do look for specifics, how are they doing for marketing, what’s their background, how are they going to drive the mission forward. Because we have been working on strategic plans to try to make sure we’re still relevant and that we’re growing with the times, and part of our strategic marketing is using more technology to both deliver our message and/or understand the marketing better so we can deliver more pertinent messages.
Rich: So your counselors and advisors are constantly in learning mode as well.
Yury: Are they full time or …
Peter: Yes, all our advisors are full time.
Yury: How big is the pool of the advisors that you currently have?
Peter: We have 10 center offices with other satellite locations, and we have 12 people covering those.
Rich: So we’ve talked just briefly about the advisors, but what are some of the resources that you offer growing businesses in Maine?
Peter: Growing businesses, we have certain tools that we can use, ProfitCents, basically the name doesn’t matter, but we have tools as far as research for specific industries, for trends, for population, for growth. We have financial models we can put them in that then compares them to similar industries to make sure that they’re on track, or maybe there’s something they’re missing. And that is for either existing businesses or if someone’s trying to get into business. If we’re doing projections, are they what we expect to see from this particular industry?
Rich: So if I’ve got something new, whether it’s motorcycle rentals or whatever it may be, you would be able to help me determine is there potentially enough demand for the product or service, that’s part of one of the things that you might offer?
Rich: And how about things like finances? If I don’t understand my books, is the Maine SBDC available to help me with those kinds of things as well?
Peter: Yep, we are, that’s part of our core training, is just understanding primarily the big three financial statements, how they interact and how to explain that. Because a large part of what we do is education, right? We’re not like a consultant where you pay us and we deliver a product, and you might not have any participation in that product.
Peter: What we’re trying to do is educate the business owner so that they can be a better business owner on their own. With the financial statements in particular, we want them to understand what is this financial statement in front of me telling me, and what should I be looking out for that are maybe red flags, and what are good signs. Because it’s not all bad.
Rich: It sounds like we’re getting a lot of good resources.
Yury: For sure, yeah. Is there a cost associated with the services that you run there, how does it work?
Peter: I like to say it’s prepaid. If you’re a taxpayer, you’ve already paid for us, right? So there’s no additional cost to our services. Definitely use us, but we’re not going to charge you anything else.
Yury: So how would I go about reaching out to you?
Peter: The majority of people find us on our website, there’s an advising link right at the top, or they just call our office in Portland and we can schedule throughout the state.
Rich: It’s a very handsome-looking website, not that I’m biased or anything. So if somebody is interested, if they’re listening in and they’re saying, “Yeah, I need help with HR, financial advice, marketing advice, I need some sales training,” whatever it may be, are you suggesting the first thing to do is to go to the website and start looking for resources, or use the website to reach out to an advisor? Is there a specific path that you recommend?
Peter: Checking the website is good, but a lot of times people are coming to us precisely because they’re finding a whole bunch of information and can’t process it through the Internet. So they need someone to sit down and actually talk to, to help them process all that information, because they might get wrong information or conflicting information, where there is kind of like a sounding board. So I always advocate for people to look over the materials first so they’re educated, but then make an appointment to come see us.
Yury: And how many of those appointments would I need, after the initial intake interview, how long is the process, how long is the relationship?
Peter: As long as we’re making progress forward, it can be as long as needed. We have some people who have been coming to the SBDC pretty regularly for years, and some people who only use us once. You, the entrepreneur, are the one in the driver’s seat on how much help you need.
Yury: So is there like a graduation from the program, quote-unquote?
Rich: It’s not like the Top Gun program, where you go through a process and then there’s a graduation date, correct?
Peter: Right, there’s no graduation. I mean, some people would say getting a business loan and opening your business would be kind of like a mini graduation, but it doesn’t stop there. Especially in year two or three, we see a lot of businesses come back because they’re hiring their first employee and they don’t know payroll.
Rich: Right, absolutely. So we talked about it, you’ve got the advisors – or you call them counselors, what do you call them?
Rich: Advisors, so you get the advisors. Is everything driven through the advisors, or do you also put on online courses, or in-person courses, are there workshops? Or is it basically like I come in and then I’m basically assigned an advisor, and then that advisor may with a specialist say, “Oh, you need to talk to somebody who understands PR or HR, let me introduce you to this person over here.” So what does the relationship look like?
Peter: Primarily we do one-on-one advising, about an hour, an hour-and-a-half per visit. And depending on the specialty needed, we do have ability to tap into other advisors, do co-advising. But we are going to start leaning more towards online content, because we do get questions that come up quite frequently like how do I start an LLC?
Peter: Some of those questions can be answered pretty, I wouldn’t say easily, but we can just put a video up and walk people through it, and that would save them a trip in. Because ultimately what we’re trying to do is, as long as they get the education and can become better business people, we’re not too concerned about how they do it, right? We’re just making sure they get the right information.
Rich: You had mentioned something earlier that this is all prepaid for by our tax dollars. I’m just curious, how are you accountable, how is the SBDC accountable? Do you have numbers that you are supposed to make every year, do you report to the government and say, “This is all the good we’ve done?” What does that look like for you?
Peter: Yes and yes. All of the numbers that the SBDC puts forward has an attribution, what we call an attribution behind it, and that is the business owner themselves or the entrepreneur is directly attributing the work that they did with the SBDC with their success, whether that’s start a business, hire a person, get a bank loan, or use their own funds, however that looks. We do not count any numbers unless it’s been attributed by a client. We don’t use any kind of scale or multiple or calculation or anything like that, these are direct attributions.
Peter: With our funders, primarily the small business administration who are are great to work with, they require certain metrics from each state, because there is an SBDC in every state. Maine is what we consider a minimally-funded state because our population is so low, so the Maine SBDC has always been knocking it out of the park as far as numbers. For instance, we see anywhere from 1600-2000 clients a year, we generate anywhere from 35-40 million in capital. So compared to what would be expected from a small state, we always do much better than what they think we should do.
Yury: You said that we are doing better than expected. Well, maybe it’s time to raise the bar.
Peter: We have our own internal bar that is pretty high. The one bar is kind of set throughout the nation based on all the SBDC’s, but our own internal expectations of ourselves are higher.
Yury: Oh, I see what you’re saying. Could you tell us how can someone who’s interested in helping businesses, how can this person become an advisor?
Peter: Occasionally we have job postings, I just hired someone for the Southern Maine position in York, but we do have a limited amount of advisors, only 12 advisors. So if someone were interested in donating their time, for instance, then we might work with our SCORE partners, or the Women’s Business Center, or the veteran’s center, VBOC, and try to connect them with those other centers to be able to facilitate any kind of mentorship that they might be interested in, and/or if we have particular clients, we can always try to facilitate some kind of handoff there as well.
Yury: It sounds like Maine has so many resources that allow anyone to succeed in any industry in the field that they choose. Are there any particular gaps that need to be addressed, or do you think we’re pretty well covered everywhere?
Peter: Well, I always tell till my clients that Maine is really the jackpot, especially for startups, for resources available. But where I see a gap sometimes exist are businesses who are past that two- or three-year mar, they’re mid-sized businesses, I find a lot of them feel like there aren’t resources specifically catered to them. There’s a lot of help for startups, a lot of help for selling a business, but that little middle area tends to be a place where – whether it’s true or not is a different matter – but there’s a perception that, “I’m started, had a lot of help starting up, but now …”
Yury: What do I do next, right?
Rich: So you mentioned earlier the SBA. How well do you work with the SBA, the Small Business Administration? Do you guys partner with them, or do things get really heated at the annual softball game?
Peter: Oh no, we partner with them very well. Brad Currie is the Managing Officer down my way, down in the Southern Maine area. We do events together, we share tables sometimes if need be. But we have ribbon cuttings, we do a lot with them.
Rich: So it’s not a competitive thing where you’re going after small businesses to help, and whoever gets that small business wins. It’s definitely more of a collaborative approach.
Peter: Right, yeah. In fact, we refer people back and forth, because they are ultimately the higher umbrella between the SBDC, the Women’s Business Center, VBOC, and SCORE.
Rich: Okay, I see. That makes a lot of sense.
Yury: Peter, is there anything that we should have asked you but we did not, but you really wish to share a message, or anything like that?
Peter: Well, the important thing is that we’re not just for startups. We can see anyone in business, or thinking about getting into business, and we have locations throughout the state. A lot of entrepreneurs feel like, “If I’m in Bridgton, there’s no one close to me.” Well, we do have 10 offices throughout the state, but we can go to one of our satellite offices to meet you as well. We’re also trying to move more to online video if that would work, or telephone, however you need to, we can accommodate how you need to get in touch with us. But the important thing is getting in touch with us.
Rich: Yeah, and that all starts at the website. What is the website address again?
Rich: Awesome. Peter, if you could change one thing about Maine’s business ecosystem, what would it be?
Peter: It sounds like it would put myself out of a job, but for some things in business such as estimated tax or payroll, I really wish there was just one system that was easier to understand. Because right now it gets so complex for just the normal person starting a business that it gets overwhelming very quickly, which is what we see a lot, is people come in because they’re just so confused. So if there were a way to just kind of streamline it – again, not part of the business, would be me out of it – but if we could streamline where it’s really easy to get people into business and understanding what they need to do with just a click, that would be great.
Rich: That would be so good because, just to share a quick story … The other day, a client, a prospect, asked me to sign an NDA, which happens, I’m like, “Sure, okay, your idea is so brilliant, whatever.” So they send it to me and I sign it online. They say, “Where are you guys incorporated?” And I’m like, “We’re incorporated in Maine.” And they’re like, “Oh, because I went online to such and such a website and it says you’ve been dissolved.” And I’m like, what?
Rich: So I go online and I find out – you can go online, it’s all there – and it turns out that our clerk had not sent in the paperwork for our annual report, which is basically you saying, “Click yes, we still exist.” But I hadn’t had to do that myself, except for getting a bill from them once a year for this clicking on it. I didn’t know this, so I went in, I took care of it. I will say the great thing about the state of Maine is that as soon as I paid it and just updated, it was basically updated, I updated one thing, that was it and within an hour it was back on the website saying undissolved or whatever the right language was.
Rich: But yeah, I never would have known that, and it probably could’ve gone on for months, if not years, had not this very particular, specific prospect gone online to look it up herself. So yes, if there was an easier checklist or something, I completely agree. Sometimes all of the things we have to sign off on can get in the way of us focusing on growing our businesses.
Yury: So Peter, if any of our listeners would like to get in touch with you, or get directly in touch with SBDC, where can they find you online?
Peter: The website, www.mainesbdc.org, and on the website on the top portion of the website is “request advising”, it’s a nice button that sticks out quite nicely. And then they can sign up, and that goes to a central office in Portland and we can try to figure out the geography. So it’s real important, if you live somewhere but you can meet in Portland or something, to really specify where exactly you would like the meeting to be or what geography, so we can match you up with the closest adviser.
Yury: Would advisors travel to the business person for the meeting, or the business owner needs to get in touch with you guys and locate you?
Peter: Typically we’re so busy that it makes more sense for the business owner to come to us, so we can see more clients and help more people.
Rich: All right. No house calls, you’re going to have to go out to the Maine SBDC.
Peter: Well, we do … Especially the northern parts of Maine where it’s harder to travel, we do have advisors that go out and we do that as well.
Rich: Peter, thank you so much for coming by today and sharing a little bit about what’s going on in the Maine SBDC with us.
Peter: Thank you for having me.
Yury: It’s been a pleasure, thanks a lot.