Season 1, Episode 6 Listen to a conversation about the future outlook for small businesses on both coasts as states...
Laurel Road’s Alex Lawrence and Briarley Laban
Lauren Herpich, Owner, Local Food Adventures and Rob Byrnes, President of East Midtown Partnerships
Alex [00:00:07] Hey, everybody, this is Alex.
Briarley [00:00:09] And I’m Briarley, and you’re listening to Financing Ambition, a Laurel Road podcast.
Alex [00:00:14] Today, we’d like to welcome Lauren Herpich, founder, and owner of the food tour company, Local Food Adventures in Oakland, California, and Rob Byrnes, president of East Midtown Partnerships, a business improvement district here in Manhattan.
Briarley [00:00:27] We’re really excited to speak with Lauren and Rob today, two members of the small business community who have really felt the impacts of the pandemic and have been doing some really interesting things. So without further ado, let’s get into it.
Alex [00:00:45] So, Lauren, please tell us a little bit about yourself, your business. And can you give us the short story of where you came from and where you are now?
Lauren [00:00:55] So I have been giving food tours in Oakland and the East Bay Area of San Francisco for the past five years. I started my food tour career as a campus tour guide. And then when I was a student getting my masters, I had found a part-time job with a food tour company in downtown Chicago. So I absolutely loved it. It was a great way to pay the rent. When my husband and I, we moved out to the Bay Area in 2013, I was doing consulting out of our tiny apartment, working by myself. And I would like to say in the tone of my voice, you’re going to hear that I liked people way too much to work by myself all the time. So every day I would take my reusable bags down College Avenue in Oakland and I would take out stuff for lunch or dinner. And I literally got to meet all the shop owners and restaurant workers. And one day we were out with friends and they said, oh, yeah, you know, we took this really cool food to my last weekend, you know, my husband turned around and said, you know Lauren, you love giving food tours, why don’t you start a food tour for fun? and it was a great way to really get more ingrained with the community. I looked at it also as a way to help the small businesses that I worked with. So it’s a great business now too because I’m also a working mom. So I’m able to do this working out of my house. And it’s just been awesome. And then 2020 happens and the Crown Princess cruise ship decided to dock in the Port of Oakland and everything kind of came to a halt. I knew that we weren’t going to be able to tours anymore, but I wanted to keep the tour going. And so I created a food tour in a box. It’s a collection of favorites that you’ll find on many of my tours. And anybody all around the country can enjoy a little taste of Oakland and the east bay.
Briarley [00:02:46] I really love that. You just you turned what you loved to do into what you’ve just said is quote your real job. It’s super inspiring. Rob, you’re here in the epicenter of New York City with us. Can you tell us about your background and how COVID has impacted your world?
Rob [00:03:04] I’ve been an economic development professional for 40 years now. I’ve led East Midtown Partnership since it was founded in 2002. It is the eighth largest business improvement district in New York City. If you don’t know what a business improvement district is, it’s a geographic entity set in statute where the property owners have agreed to assess themselves for the provision of additional services, for marketing, for beautification, supplemental services, sanitation, for instance, security. My district covers all or part of 48 blocks of midtown Manhattan. We have thousands of professional offices, more than 800 storefronts. It’s a major commercial hub internationally. Unfortunately, of course, now many of those businesses have been closed for months. My focus has now been trying to keep what the businesses that are still out there, roughly 20 percent, about 160 of the 800 storefronts and trying to keep them alive. I’m trying to help pave the way to reopening for those that are starting to come back. I also, by the way, I’ve been home, I left the office on March 20th, turn the key, came home to New Jersey, where I overlook Manhattan, and I haven’t been back to the city since. So I’m adapting. I have learned how to do all our banking remotely, I’ve learned how to access the phones remotely. All the little things I never thought I’d have to learn. And I managed to get through 61 years without ever owning a bandana and then today I have twelve.
Alex [00:04:40] You know, I would say that Mask Innovation is one of the most fascinating things that has come out of this pandemic.
Briarley [00:04:47] Yeah. Lauren, you mentioned that the diamond prince’s arrival in Oakland was one of the things that really started the big shifts in the way business is running in your city. Can you share a little bit more about had that day affected your business?
Lauren [00:05:07] Yeah, I mean, the Princess Cruise Line had been out in the San Francisco Bay just past the Golden Gate Bridge for about two weeks. And so it kind of you had the looming feeling of, OK, something’s happening. And just before the day that they announced that it was going to be parked in the Port of Oakland, I had booked probably one of my largest tours that I have ever had. I was expecting a total of 50 people. They were going to be doing a conference and they wanted just to do something fun and different. And so, you know, just getting the calls from people who had already booked. Organizers of all these private tours saying, are you comfortable, what do you think? And then finally just turned around and I just said, listen, I’m not comfortable with this working with my restaurants as well, because, you know, listen, I have great partnerships with restaurants and they’re a big part of the experience. So what are they comfortable with, too? So we just decided that we would just kind of put things on hold. And the nice thing is for those smaller groups that we had with a lot of local businesses, you know, they were willing to let me hold on to their deposit. So it was really nice to see people saying, you know what, we feel you’re not going anywhere. We’re not going anywhere. And when we’re all more comfortable, we’ll be able to be together again.
Alex [00:06:24] So that’s a really amazing thing to hear, that you had established such rapport with your community that you all sort of knew that you would weather the storm together and come out on the other side.
Lauren [00:06:39] And I will say the icing on the cake, though, is that some of those groups that they were supposed to come into a tour when I launched the local love gift box, they actually wound up purchasing boxes for the people who are supposed to be coming on our tour.
Briarley [00:06:58] So, Lauren, we wanted to get into and understand more about the impact on your business and the industry overall. Can you tell us how you’ve been working together to really evolve and adapt with the current situation that we’re in?
Lauren [00:07:13] So I think just like food, food brings people together. And so I am so fortunate to be part of an amazing community, a food tour operators all around the world. And so one of the things that happened right away with a conference that we all go to every year started putting together webinars. There’s a group of us in San Francisco that we were getting out together just to talk and to share ideas. And one idea that came up real quickly out of Seattle was sort of a meal delivery service. And so I think just by a stroke of luck, I was watching TV one night and I saw a commercial that said, I’ll order yours by Mother’s Day. I remember what the item was. And I said, you know what, that’s what I can do. I can put my food tour in a box. And so I reached out immediately to all of my tour stops. And I said, hey,_____ I want to put your olive oil in my box. And hey, Margaret Hall Foods can we get some pasta and Evelyn Jones, let’s do BBQ sauce. And what was amazing about that was that, you know, not only when people buy the box or are they putting my business, but was giving my food tour partners income as well. And, you know, one thing that I’ve done from my very first tour is I always give a dollar from every gas that comes on my tour to the Alameda County Community Food Bank. So, you know, with the boxes, I was able to continue that commitment to them. And then I also added another dollar donation for each box to a new nonprofit organization called EAA Feeder, which is in the network of Chateau Jose Andres’ World’s Central Kitchen. They are buying meals from restaurants at full price, and that they’re providing meals for first responders at five easy bay hospitals.
Briarley [00:09:01] That is so, so great to hear. And I’ve found personally cooking has been a bit of a journey for me. And a soothing experience. So I love what you’re doing here.
Lauren [00:09:12] You know, I had this idea for a gift box. You know, I’ll be honest with you, place three years ago. I want to do something around the holidays. And I just didn’t have the bandwidth and I’m not doing any tours, so I have a little bit more time on my hands. But I do think that it would not have been as successful had I launched 3 years ago because people really have opened up their hearts and their wallets. So the response has been overwhelming.
Alex [00:09:40] So, Rob, since we’re on the subject, tell us about what sort of outside of the box thinking have you seen from some of these businesses in your district? And what sort of hand has your partnership had in getting them back up and running?
Rob [00:09:52] Sure. When the governor announced that all restaurants were going to close, nobody in much of a time to react, frankly, but some restaurants decided to hang in there. So that was the main thing I had to push, because first of all, of course, food and dining is a major component of the New York City economy. Secondly, people still have to eat. First thing I do is I built a page on our Web site and I started listing every restaurant that was offering takeout and delivery. So and thank God for social media. This had happened 25 years ago. I don’t know what we would be doing, but we were able to utilize that to promote those few restaurants that were actively out there delivering or offering takeout food. In the last few weeks as more PPP money’s becoming available, more restaurants are starting to open. So, you know, we’re getting the word out there even more and they’re starting, you know, the weather’s getting nicer and people are out in the streets. And so the state liquor authority is allowed drinks to go for the first time. And so, you know, we’re promoting that, we’re promoting the purchase of gift cards to help keep some businesses solvent. One of the things I’ve been doing is I’ve started to record a series of interviews with local business people mostly, and then aired them on social media. I mean, you have to we have to be a little creative. It’s really all about setting the pace for the future, because eventually, if they can hang on, these businesses will reopen. And, you know, this is a way to keep their customer base engaged.
Briarley [00:11:30] Rob, can you tell us what New Yorkers can do to help your businesses through this time?
Rob [00:11:37] In the case of restaurants ordered directly from the restaurant, first of all. And not through third party delivery services, because some of these delivery services were getting 30 percent and also charging to process a phone call, even if there was no order was ever placed.So patronizing all local businesses, there’s all these mom and pop stores around the area that most of them have Web sites. And so, you know, that’s what they can do right now. Just remember that the money you spend today will help keep a vibrant street life and make every commercial area special.
Alex [00:12:12] That’s a really wonderful call to action for people to call up the little guy directly because you get the same service and you’re going to give a lot more back that way. So, Rob, in your introductory e-mail to me. You spoke of a steep learning curve educating the businesses in your district on federal stimulus programs. Have they been particularly helpful?
Rob [00:12:31] They are well-intentioned. And I can see how outside of New York they would have been more beneficial to the small businesses than they’d been to my businesses. There was a little confusion there. I was dealing with businesses that were just not clear. Incomplete applications, lots of questions. And, you know, it was hard to follow up because people were really rapidly closing their doors. And that was in the first round of PPP. Eventually, it came for a lot of businesses. And here’s the problem. At least seventy-five percent of that loan has to be used for payroll and it has to be used within a certain window. When it was created, it might have been realistic to think in a few months we’re going to be back to normal. So this is a great bridge. Well, the fact is it’s not happening in New York, which means those loans that should convert to grants are actually going to end up being maintained as loans unless they give the money back. The other problem is the New York City with rent so high, that means that all the other operating expenses have to come from another source. You know, again, it’s all about payroll protection. So, yeah, you know, that’s somewhat to be expected. Problem is, though, if you’re paying, I don’t know, twenty-five thousand dollars a month rent, it’s out of whack here. So a lot of my businesses are finding it very hard to see a way forward to keeping the money, which is unfortunate because many are running the businesses at a loss to keep their people up.
Alex [00:14:09] I think a lot about how this pandemic may have affected the most vulnerable among us. What has it been like caring for the homeless in your community?
Rob [00:14:20] We’ve had homeless outreach programs since November 2002. We brought more than eight hundred people off the streets into transitional housing, into rehabilitative programs. We also have a — for our sanitation program, which is quite extensive we contract with a workforce training program, the people that we contract with are all formerly incarcerated and many have been homeless. So, I mean, this is a problem. The people that are choosing to stay on the streets right now are chronic homeless that are the most resistant to coming off the streets. And, yeah, our teams have been out there throughout this. We know our local homeless community. Really every contact has to be individually tailored. So we’re still at it.
Alex [00:15:15] That sounds like a unfathomably challenging situation. And yet there is an advocate for those people in the form of your partnership. And that’s a pretty remarkable thing.
Rob [00:15:26] We never give up, OK, as long as there’s one homeless person out there. We will be in contact with that person as often as we can.
Alex [00:15:35] That’s great. Great to hear.
Briarley [00:15:39] So just to wrap things up, we’d love to hear your takeaways, and learnings, and any maybe silver linings. So, Lauren, what advice would you give other affected businesses?
Lauren [00:15:51] I think my biggest takeaway is just always looking at the long game. This is not going to be forever. What I love right now is I now have a product that’s going to outlast COVID. When my tours get back. If you were not from the Bay Area and had such a great time on my tour, why not have a box of all the goodies that you enjoyed and have it when you get back home. And, I’ll be honest from a personal standpoint, too, this has allowed my family and I to spend more time together. You know, our bedroom and our house look more like a fulfillment center than it does a house right now. But it’s worth it. And what I love, too, is that, you know, we have a lot of restaurants now that they’ve kind of gotten into the gift box effort, too. I mean, we did a picnic box and we had a picnic in our backyard, and it was a great way of supporting them. And I think any business out there just think outside the box. And, you know, come up with something that really works for you.
Alex [00:16:51] I love that. Would that work for a slogan for your company? It’s the box that thinks outside the box.
Lauren [00:16:58] I think I have a T-shirt made with that one on it.
Alex [00:17:02] So, Rob, could you share any positive takeaways from this time and any ways that you’ve seen businesses bouncing back, persevering and any advice you have for those who can’t see the light at the end of the tunnel?
Rob [00:17:14] What would this experience has shown us is that people, both individuals, and business people, they’ve been looking out for each other. You’ve seen clips from New York City of people banging pots and pans at seven o’clock to thank the frontline workers. I have numerous restaurants that have served thousands of meals to those workers. And better yet, though, they’re teaming up. People are learning to collaborate. I have a whole team of little old ladies from the neighborhood who email me about openings and closings, because they know I can’t get in. And, you know, we are a business improvement district, but we are one of 76 in the city and all of us have been working together to look at best practices for reopening, how to stay safe, how to work from home. You know, there’s not a whole lot we could have done to not be at this stage. But the fact is that we’re making the best of it. And we’re looking at how to move forward.
Alex [00:18:13] Great to hear. Thank you both so much for coming on today. And we really appreciate both of your perspectives. And thank you again.
Lauren [00:18:21] Thanks for having me.
Rob [00:18:21] Thank you all.
Briarley [00:18:24] That was such a great conversation with Lauren and Rob. I’m just amazed by both of their resilience in this environment. Just speaking to kind of Lauren’s experience, way to make lemonade. She overnight lost the business and she knows it. So she pivoted into something that she’s always wanted to do. Also creating business for all these restaurants that are not allowed to be opened right now.
Alex [00:18:50] Well, I 100 percent agree. That was a really remarkably innovative and clever thing on her behalf. So kudos to her for that. I was very impressed by just Rob’s sort of practical, rational approach to getting his businesses up to speed on ways that they can sort of stay alive and stay viable during this time, hearing about how he is a true advocate for his businesses. And it’s wonderful to know that the city has champions like that.
Briarley [00:19:16] Yes, I totally agree with you, Alex. And I loved Rob’s advice about how we can all support small businesses, whether you’re in Manhattan or anywhere in this country.
Alex [00:19:28] We would love to hear from you if you’re a small business owner or if you have a passion for small business owners. Please feel free to share your story with us at [email protected]. That’s [email protected]. We’d love to hear from you.
[00:19:42] Now let’s get the legal out of the way. Any opinions, findings, and conclusions expressed in this podcast are those of the participants and do not necessarily reflect the views of KeyBank in providing this information. KeyBank is not acting as your agent or is not offering any tax, financial, accounting or legal advice. Laurel Road is a brand of KeyBank and a Member FDIC and equal housing lender and NMLS. Number 399797.
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