On the Money Trail
[Photo: Jeffrey Camp]
Founder and President: Christopher M. Chestnut
Business: Law firm specializing in personal injury and class action cases
How it is Financing Growth: Loan
With encouragement from famed Florida attorney Willie Gary, Gainesville attorney Christopher Chestnut set up his own firm at age 26. From the start, one of his biggest challenges was access to capital. “I was a tremendous risk at 26,” says Chestnut, adding, “My credit wasn’t bad, but it was limited.”
Still, Chestnut, who clerked with Gary’s firm as well as John Morgan’s Morgan & Morgan while he attended law school at the University of Florida, built the firm using bank lines of credit. He added three additional attorneys and 10 staff assistants.
In 2008, looking for working capital to fund further expansion, Chestnut ran into a roadblock at banks. “I found a significant barrier,” he says. He turned to the Access Florida Finance Corporation, which is the new name for the Black Business Investment Corporation. Access Florida uses state funding and income from lending fees to provide both loan guarantees and a limited amount of direct loans to black-owned businesses, particularly in smaller communities around Florida.
Chestnut applied for about $50,000 in October 2008 and received the loan later that fall. “It’s just like going to the bank,” says Access Florida President Mark Scovera, who adds that a lot of banks don’t want to deal with small loans of $50,000 or less, so that is Access Florida’s focus. Chestnut plans to use the funding for equipment and additional staff.
[Photo: Gregg Matthews]
PlusOne Solutions - Oviedo
CEO and President: Craig Reilly
Business: Management of independent service contractors for brand-name retailers
How it is Financing Growth: Investment Capital
Venture capital investments in Florida dropped dramatically in 2008, but PlusOne Solutions was one of the few companies to get investor capital. The Oviedo company helps major retailers and manufacturers recruit, check backgrounds, dispatch and manage outside independent service personnel who deliver and repair electronics, appliances and other products.
PlusOne got investors’ attention by putting together a strong management team and proving themselves and their concept before they asked for money. Founding CEO and President Craig Reilly and two partners used their own money for startup capital for more than two years before seeking money to grow from outside the company. With the help of the University of Central Florida’s Venture Lab, Reilly drafted a business plan designed to appeal to investors and he refined a funding sales pitch, known in the venture capital world as an “elevator speech.” “We were looking for a group that offered more than just the funding,” says Reilly, explaining that he wanted a long-term partner. PlusOne projects $3.5 million in revenues for 2009.
In October 2008, just when the global financial meltdown took hold, PlusOne closed a deal for $752,000 with the Winter Park Angels investment group. Says Reilly, “Given the current economy, this money will go for at least two years.”