Owners pair their dreams with Cincinnati's Minority Business Accelerator backing
Business Courier of Cincinnati - by Dan Monk Staff Reporter
Two men, two dreams and $2 billion: That's how the numbers could line up for Cin
"If you have no dream, you have no means of achieving it," said Stephen Hightower, a Franklin-based fuel supplier who hopes to build a chain of up to 200 gas station/convenience stores in the next five years. He's yet to make his first purchase, but he has lined up financing from a Los Angeles investment bank and recently made offers on an initial group of stores. The retail expansion could grow revenue exponentially at Hightowers Petroleum Co., which is already on pace to double sales in 2008 to more than $100 million by supplying fuel to corporate clients, including Duke Energy Corp., AK Steel and Kroger Co.
Christopher Che, meantime, has formed a holding company to acquire up to 10 businesses that would compete as vendors to Fortune 1000 companies. Che International Group (CIG) has made its first acquisition, buying a Dayton-based label maker, Hooven Dayton Corp. Che said it is growing at a 30 percent clip since he bought it in 2006. He predicts it will finish 2008 with revenue between $15 million and $25 million. He is now competing for his second acquisition, a local printing company that could boost CIG's total revenue to more than $100 million.
The 46-year-old native of Cameroon is a Miami University graduate whose 17-year accounting career included service as chief financial officer for chemical and packaging companies owned by basketball legend Oscar Robertson. He figures it will take 10 years to build his own company into a $1 billion enterprise.
"It sounds very aggressive, but that's what I'm shooting for," Che said. "I'm just implementing what I've always thought should be done."
'Look at broad landscape'
Hightowers Petroleum and CIG are two of at least eight companies now working on acquisition strategies with help from the MBA, which is operated by the Cincinnati USA Regional Chamber of Commerce.
"We want firms to look at the broad landscape of opportunities," said Jonathan Railey, the chamber's vice president for economic inclusion. "People are becoming more sophisticated in understanding their business and their markets, in understanding their wherewithal to make acquisitions."
At the MBA's annual stakeholders breakfast in late June, Railey reported that 25 companies in the program's portfolio have nearly tripled their average revenue to $20.8 million since 2003. The MBA also has increased the number of local companies that established specific goals for contracting with minority-owned companies. Local firms told MBA officials they have spent more than $820 million with local minority-owned businesses between 2003 and 2007.
"There's been a lot of change. Cincinnati is a much more inclusive, diverse city," said Carl Satterwhite, a former Procter & Gamble Co. facilities manager who formed a joint venture with Globe Business Interiors in 2004 to sell and lease furniture to corporate clients. Five years later, River City Furniture is a 12-employee enterprise with revenue approaching $40 million.
"We will see minority firms of significant size," Satterwhite predicted. "We are having access to opportunities that we didn't have access to before."
Will Scott estimated more than a third of his total revenue comes from contacts he met through the MBA. Scott is the owner and founder of The Fortress, a records management company that could double in size this year. He wouldn't give sales figures.
"They've been able to put us in front of some large accounts," said Scott, who is planning expansions to Lexington and Indianapolis this year.
Still work to be done
Stephen Hightower credited the MBA with "creating an environment for us to engage with various companies" but stressed that most of his growth came from proving value to corporate clients, including Duke Energy, which accounts for 40 percent of revenue at Hightowers Petroleum. The 51-year-old entrepreneur is encouraged by new contracting opportunities but disappointed he was unable to find local financing to fund growth in his wholesale business or retail investments. He declined to name his California lending partner but said he secured the arrangement about six months ago.
"The banks say they want to loan, they want to support minority business. Are they doing it? My answer is, 'No, they aren't.'" Hightower said. "Had we waited on the banks in this area to support us, we'd be out of business."
dmonk@bizjournals.com | (513) 337-9438
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