CINCINNATI — He's been on the job for less than a day, but Darrin M. Redus Sr. already has some big ideas for how to take the Cincinnati USA Regional Chamber's Minority Business Accelerator to the next level.
Redus started as the new vice president of the program known as the MBA on Jan. 19. He is a former commercial banker with years of experience working with minority business owners to help them grow their companies.
The MBA was created in 2003 as part of the community's response to the riots that tore through Cincinnati in 2001. The idea was that economic disparity was a root cause of the unrest that divided the community. The MBA was designed to help grow sizeable, black-owned companies that would, in turn, create more jobs for black residents. Hispanic-owned companies were added later.
Several regions across the country have launched programs modeled after the MBA, which is still considered an innovative approach to building minority-owned businesses.
But as successful as the program has been, there is more that the MBA can do to help grow local minority-owned companies, said Sean Rugless, CEO of the Greater Cincinnati-Northern Kentucky African-American Chamber of Commerce. Redus, he said, is the right person for the job.
Sean Rugless
"His background is a wonderful fit for what's next for the MBA," Rugless said. "The next opportunity is to build stronger firms internally."
As vice president of the MBA, Redus will lead a program that was serving 30 minority-owned companies by the end of 2014. Those companies had collective annual revenue of nearly $1 billion and employed more than 3,500 people.
To qualify to become part of the MBA's portfolio, companies must have: annual revenue of at least $1 million or more; a business plan or growth strategy that has strong potential for fast growth in two to five years; certification as a minority business enterprise; and a headquarters or large presence in the 15 counties that make up Greater Cincinnati.
The MBA also has 40 goal-setters — nonprofits and corporations that pledge to award contracts to local minority-owned firms. Those goal-setters spent more than $1 billion with local minority-owned companies in 2014.
Redus told WCPO in an exclusive interview that he sees opportunities to help the minority-owned companies that the MBA serves as well as the corporate goal-setters that are so important to the program.
Here are the top nine highlights from the interview with Redus on how he will use his knowledge and experience as the new leader of the MBA.
A fresh look. Redus hopes to help each minority-owned company in the program's portfolio take a closer look at its operations and growth plans and help determine whether the companies could be thinking bigger.
"We're able to give visions a reality check, but in many cases give visions a boost because we're able to introduce other forms of resources that perhaps the entrepreneur may not have been aware of," Redus said.
"When we think about aligning that vision with capital providers, it will help us inform whether or not the vision is grand enough."
Connections in finance. As a former commercial banker with experience in private equity and venture capital, Redus knows a lot about different ways businesses can get the money they need to grow.
"My background and relationships can assist on the best strategy from a capital standpoint," Redus said.
The National Association of Investment Companies, an organization of black- and Hispanic-led private equity and venture funds, could be a good connection for local minority-owned businesses with aggressive growth plans, he said.
Knowing the numbers. One of the reasons minority business owners can't get traditional bank loans is because often they don't understand what financial results their companies need to qualify, he said.
"A business can, if they really have their numbers in order, do a self-assessment, much like people look at their personal credit scores," he said.
For example, if business owners figure out they need to have more cash flowing into their companies before they can qualify for a loan, Redus said, they can design strategies to increase that cash flow.
Darrin Redus
With Redus at the helm, the MBA will put a strong emphasis on ensuring that the program's portfolio companies know their numbers, he said.
Smart growth. Redus has helped many minority business owners figure out the best way to grow — whether that's through mergers, acquisitions or the creation of a new product line, he said.
"A lot of my first so many weeks on the job is really looking at where is each company from a growth standpoint," he said. "What has already transpired, and how can I add value."
Advising goal-setters. With his experience in the corporate world, Redus said he would be able to work with local corporations to figure out new opportunities to do business with local minority-owned businesses that they might not have considered.
"I can certainly put on my corporate hat and say where are there opportunities," he said. "There could be industries where we don't yet have a strong presence for minority-owned companies."
Globalization. Corporations are doing more and more business outside the U.S., and minority-owned companies should look at ways to make adjustments so they can work internationally, too, Redus said.
"If perhaps a vendor now needs to be able to conduct business in other countries to be an effective partner to a corporation, let's look at opportunities that might exist in that regard," he said. "As the saying goes, where is the puck going? How do we best align companies in the portfolio?"
Getting a piece of a bigger pie. Minority business owners — like many small business owners — are often reluctant to accept equity financing because it typically means sharing the ownership of their companies.
Redus called that "one of the tragedies of the lack of alternative forms of capital for a lot of minority companies."
Companies that don't want to share ownership, he said, "are fundamentally cutting off a huge potential influx of capital to your business."
Redus hopes the MBA can help the minority business owners in its program understand that giving up a 10 percent or 20 percent stake in the business can help create a much bigger company and more profits for everyone who owns a piece of it.
Tech know-how. Over the past decade, Redus has spent a lot of time working with technology companies and has lots of connections there.
He hopes to use his connections and experience to help the MBA's minority-owned firms understand how to use technology to grow their businesses.
"If a company is making parts in the automotive industry, perhaps through a modest pivot it could start doing business in aerospace or windmill technology or any other kind of emerging space," he said.
Respect for the program. Don't let all those ideas for improvements fool you. Redus said he'll be building on the strengths of the MBA in his new role.
"There really isn't a collection of 30-plus larger-scale minority companies with a goal-setter sort of initiative anywhere else," Redus said. "That's just a tremendous foundation to build from."
Darrin Redus at the Cincinnati USA Regional Chamber.
Lucy May writes about the people, places and issues that define our region – to celebrate what makes the Tri-State great and also shine a spotlight on issues we need to address. She has been writing about women- and minority-owned businesses in Greater Cincinnati for more than 17 years. To read more stories by Lucy, go to www.wcpo.com/may. To reach her, email lucy.may@wcpo.com. Follow her on Twitter @LucyMayCincy.
