Building businesses: A Q&A with Small Business Services Commissioner Gregg Bishop
New York City Small Business Services Commissioner Gregg Bishop welcomed a few dozen people to the inaugural graduation ceremony of the NYCEO Mentorship Program this month by repeating a personal motto of sorts – “Experience is actually mistakes,” he said. “As you are building your business, we don’t want you to make those same mistakes, which is why we came up with the idea of this program.”
Bishop clapped alongside others as a woman described how the seven-month program, which pairs up to four minority- and women-owned firms with a mentor whose business has an annual revenue above $1 million, helped her develop a business plan, and ultimately, secure investors.
Bishop said his goals of bolstering businesses across the boroughs, enhancing city training programs and improving the agency’s digital accessibility are an outgrowth of his personal trajectory from the grandson of a milk and produce entrepreneur in Grenada to an East Flatbush resident participating in the city’s summer youth employment program to the leader of SBS.
“My grandmother realized that she needed to maximize her profits, so as she was selling milk, she would fill up the bottle three-quarters of the way and then fill a quarter of water,” he said. “When you’re an entrepreneur you’re trying to stretch that dollar …. The businesses that we interact with, generally, are less than 10 employees. They don’t have the access. They don’t have an attorney on retainer. They don’t have venture capital backing the to connect them to services. So these [SBS] services are vitally important.”
Growing up in East Flatbush, Bishop got his first job through the city’s summer youth employment program and was then looked for future positions in the area, which brought him to the Brooklyn Library. He said his self-training in technology led to a career in the private sector. He started at SBS seven years ago, and after a few promotions, assumed the commissionership at the end of November.
City & State’s Sarina Trangle talked with Bishop about what he’ll focus on as commissioner, rising commercial rents and what a $15 minimum wage would mean for small businesses. The following is an edited transcript.
C&S: How have your first few weeks been?
GB: It’s a tremendous responsibility, because when you look at the role the agency plays, we’re very unique because we touch on three areas that are crucial to the city: jobs, businesses and neighborhoods. When I came on board, I came to focus on helping a specific segment of businesses – minority- and women-owned businesses – and now to be totally responsible for all the areas, I just feel very honored.
C&S: What are your primary goals?
GB: On the business side, it’s access to capital. We have to increase our ability to connect businesses to capital. That is the No. 1 issue that small businesses talk about. And we’ve set an ambitious goal of, in the next three years, connecting businesses to about $65 million in capital. It’s a stretch for us because we’re doing about half of that right now. And we don’t have, obviously, a loan fund. We become really smart about what other lenders are doing, and then we provide that one-on-one assistance to businesses.
I talked about training. We are focused on the sectors that are creating jobs – so technology, health care, construction, retail, food services and industrial. We’re taking a two-prong approach to that, making sure that we’re actually creating the right training programs for New Yorkers and also working with the industry to make sure that what we’re doing is actually aligned with what they’re looking for. In a case like retail, we look at how that industry could actually improve their efficiency. And when I say improve their efficiency – when you have a good quality of life in terms of a decent wage and you’re scheduling properly, you retain the workforce.
There are a couple of other things, obviously, because of my technology background, I want to do more in technology. I want to make it easy and accessible. I want to do more in the outer boroughs – we had a great foundation with my predecessor, Maria Torres-Springer there – and do more in the immigrant communities.
C&S: What can you do to try to incentivize lending when it comes to access to capital?
GB: It’s amazing what you can accomplish with just picking up the phone and saying, “I’m the commissioner of Small Business, I’d love to get you at the table.” We want to bring the banks to the table to not only look at what is impeding them from lending, but once we identify what the impediments are, then creating services to address those issues.
The next approach is also providing that one-on-one service to the small businesses to help guide them through the lending process. It’s actually hours – because their time is valuable – we want to make sure that we give them as much assistance as possible.
C&S: We have been hearing a lot about MWBE contracting. What can and is being done to help these firms do more business with the city?
GB: Where the city has the opportunity to say, ‘We are going to put out this contract, and we’re going to actually award this contract to this contractor,” that’s called discretion – and we may limit it to just MWBEs. Where we have discretion is up to $20,000, and we are well over 40 percent utilization there. That’s phenomenal. In those areas, where we have to go with the lowest price, we are not doing well. And what we want to do is really address it a couple of ways: continue building the capacity of MWBEs – so continue making investments in programs that help businesses learn about opportunities, respond to opportunities – but also, tackle it on the legislative side. So the state has full discretion up to $200,000, and now we’re asking the state to give us that discretion as well. There are MWBEs who are performing and winning city contracts, who are not certified as MWBEs, so we’re going to make an extra push to grow that certification base to try to get companies that are winning in a higher capacity.
C&S: Didn’t the city just increase the discretion threshold to $35,000?
GB: We’re operating in what we’re allowed to operate in – that is the maximum. And it’s very complicated because it’s only for construction. It varies by industry. It’s very difficult for us to explain why we aren’t meeting our goals. And you have to be a real wonk to understand why in $0 to $20,000 we have this utilization rate; $20,000-$100,000, we have this utilization; and $100,000, this. So what we’re saying is, “Look, let’s just level the playing field, and let us have discretion up to $200,000.”
C&S: The other change announced – related to best value – is that just for construction, too?
GB: No. So best value is actually a really good change because it eliminates what I just talked about, where an agency has an MWBE bid package and has a non-MWBE bid package. And all things are equal, so then they look at price. This is $99, and this is $101. So they have to go with the $99 one. With best value, what we can say is, “Well, this company is in Topeka, Kansas, and this company is located in Brooklyn. And not because it is local, but because if this company gets this contract, they’re going to hire within New York City, there’s so many other benefits that this company can bring to the city, that actually it’s the best value for the city, even though the price is a little bit higher.”
C&S: So it involves a hiring analysis?
GB: Not necessarily a hiring analysis, but it would involve looking at not just the price, but the best value based on where is the company located, not necessarily where they’re going to hire, but where they’re going to get the materials. There’s a number of things that could come into that analysis that could help that MWBE.
C&S: If these changes have been permissible, why make them now – two years into de Blasio’s term?
GB: Coming into office – and this is why I give the mayor’s counsel Maya Wiley a lot of credit – we identified a lot of these things. It’s now coming to fruition. So this is not something that last week someone said, “Oh, we should do this.” We’ve been talking about this and pushing this for a while. I, again, give Maya a lot of credit because she’s looking at every single way and policy and also legislatively how we can actually help MWBEs and improve our utilization.
C&S: We also hear a lot of concerns about the rising cost of commercial rent. Is this something SBS is doing anything about?
GB: We are working with our partners in Council – Council Member Brad Lander, Council Member Robert Cornegy. We are looking at what we can do to help with legislation, but also what we could do here at SBS. So we have started off with some programs. When business owners want to start a business, they don’t really think about the ramification of signing a lease. They really just want the space, but there’s so many things, and so many gotchas in leases, that we started up a course – Signing a Commercial Lease: What You Need to Know! It basically breaks down every single aspect of a commercial lease and what you need to be careful of.
Sometimes a business might get a violation, and they’re not sure whether or not it’s the landlord or if they’re responsible. So we’re about to launch a service where individuals can check with us. And part of that is providing them an attorney who can then review their lease and help educate them on what they are responsible for.
And I’ve been working diligently with the team, and hopefully we’ll have some great services to announce very soon about what else we can do to help businesses.
C&S: What are you hearing about the push for a $15 minimum wage? Are any fast food franchise owners complaining. Are others worried? Excited?
GB: There are companies that are actually paying a minimum wage of $15 and above, and what we’ve heard from them is that it is about time. And there are, of course, companies who are not, and there’s some concern. What we can do is help companies understand why it is so essential to have a workforce that is compensated appropriately and that’s healthy, because it helps them. If you have an employee who is afraid to call in sick and that employee comes in sick, that is not helpful to your business at all because that employee is not productive and that employee could actually cause problems for your business. If you have an employee that’s basically shopping around for wages, you’ll spend an enormous amount of time training that employee and lose that employee within three months because there’s another business that’s paying above minimum wage. So we want to change the conversation from, “This is something that’s hurtful to business” to “This is actually something that will help your business.” We have programs to help you understand if there’s an increase in expenses in one area, how you can actually streamline and decrease expenses in another area. We strongly believe that it’s important to invest in your workforce.