Mid-South Drug Testing president Kelly Dobbins is the kind of entrepreneur banks and lenders are increasingly making it a point to seek out.
Her business is situated in the inner city – near East High School, close to the Binghamton neighborhood. A move in support of that business is the kind of thing that can resonate beyond the business’ four walls, sometimes giving a much-needed boost to the area around it.
Mid-South Drug Testing employee Tiffany McVay administers a breath alcohol test on Scott Chambers in the company's sample collection room.
(Memphis News/Andrew J. Breig)
And, indeed, Dobbins says Mid-South Drug Testing – which provides services like DNA and drug testing as well as background checks – is looking to grow.
Her business needs capital to do that, though, something small-business owners often find isn’t always readily available, even when they look good on paper.
Dobbins, among other things, has worked as an adjunct college professor of criminal justice, is considered an expert witness in local courts and others in Tennessee and her areas of expertise include criminology, forensics, and drug and alcohol methodologies.
“I’m at the place where $100,000 just wouldn’t help – I need $500,000 or a $1 million to really, really grow,” said Dobbins, who adds that she’d like to get a new building that provides more space for her firm. “I’ve had phenomenal growth especially in the last four years, and it’s drained me of capital. And in the meantime, I’m busting at the seams.”
Enter the Inner City Capital Connections program, the lead sponsor of which in Memphis has been Regions Bank. Bank of America also is a national sponsor.
The program offers participants direct access to capital providers as well as training on how to raise capital and how to sustain their business’ growth over the long term. About 690 inner-city companies and 150 debt and equity providers have been tapped to participate in the program since its inception in 2005, and more than $1 billion in capital has been raised.
Participating companies also have created or helped to create 4,977 jobs and on average hire 43 percent of their workforce from within the inner city. The program culminates this time around on Nov. 19 in New York City at the ICCC National Conference, where participants will have the opportunity to pitch their businesses to potential debt providers and equity investors.
Twenty-one Memphis-based companies, including Dobbins’, were chosen to participate in this year’s program, put together by the Initiative for a Competitive Inner City in partnership with Bank of America.
The program is designed for “investment-ready inner-city entrepreneurs” looking for business growth opportunities. Ed Powers, managing director with the Capital Access Funds team at Bank of America Merrill Lynch, said the involvement of financial companies like his makes sense for several reasons, not the least of which is the fact that the people involved with the program live and work in the communities where companies like his are financing.
“These CEOs are very entrepreneurial folks, and you just really want them to succeed,” Powers said. “You just realize these are great companies to work with, and we have relationships with all kinds of sources of capital.
“The program is really designed for smaller businesses. They’re generally between $2 million and $30 million in sales. We’re looking for some inner-city nexus, they’ve got to be looking to grow or are growing, and they do have to have flexibility for taking in capital.”
David May, West Tennessee-area president for Regions, told The Daily News earlier this year the program is especially intended to help entrepreneurs who may have come up with a successful idea or plan and achieved some degree of success but “who need to get to the next level.”
In all, 51 attendees participated in a training session earlier this year in Memphis as part of the program. Of those, 21 of the businesses were from Memphis, about 70 percent were minority owned, 50 percent of the CEOs who attended were female, and the average employee size was 25.
Dobbins said she was eager to participate, partly over her dissatisfaction with things like loans and bootstrapping.
“One of the things I’ve realized in the last year or two is there’s been some movement especially in this city around inner-city businesses like mine,” Dobbins said.
Her hope, and that of other entrepreneurs like her, is to flock to an appropriate source of capital and elevate their companies – and the community around them – in the process.