Archive for March, 2013

Thursday, March 21, 2013

CityBusiness Lists CBC in Annual “Top 100 Private Companies”

New Orleans CityBusiness listed Canal Barge Company as #11 in its annual ‘Top 100 Private Companies’ in the New Orleans area (based on revenue). Canal Barge has continued to move higher in this annual listing as we have grown our operations over the years. Canal Barge is pleased to receive this external recognition, which we believe is an outgrowth of our long-term vision, consistent management, and focus on our strategy.

The Special Focus article is featured in the March 15-21, 2013 issue of CityBusiness and includes an interview with CBC President and CEO, Merritt Lane. Merritt’s interview is below.

Interview by Ben Myers of New Orleans CityBusiness
Business Ebbs, Flows on Fluxing River

“The local maritime industry has been suffering annual crises in recent years.

In 2011, Mississippi River levels reached record highs, exacerbating the U.S. Army Corps of Engineers’ strained dredging resources. Last year, a widespread drought created the opposite problem, shrinking river depths to the point that trade associations and politicians warned that commerce might halt altogether.

That didn’t quite happen, but local businesses such as Canal Barge Co. faced severe restrictions nonetheless. CEO Merritt Lane said the first half of the year promised to deliver the strong growth he had projected, but potential gains evaporated along with the shrinking river.

‘For six months of year, we fought a situation where we were not able to load as deeply, we had to cut back the size of our tows, we had more delays,’ Lane said. ‘All of that means less revenue and more expense.’

Lane envisions sharing more risk with shippers through different contracting methods. Strict daily rates aren’t on the horizon, at least not for Canal Barge, but he said tonnage-based rates force carriers to shoulder disproportionate risk during natural events.

‘It’s very common for business in the upper reaches throughout the year to have ice clauses. Maybe we need to have something like drought clauses,’ Lane said, acknowledging that ‘market acceptance’ of this idea is uncertain.

The good news for Canal Barge was that its 2012 revenue tally of $308.4 million was only slightly off the previous year, and precipitation is picking up again along the river. Improved water and manufacturing driven by low natural gas prices bodes well for the company, Lane said.

New chemical and steel plants popping up in the River Parishes benefit barge companies such as Canal in temporary and long-term ways. They can deliver components for new plants under construction and ship the water-borne products the facilities will make.

At the same time, Lane said, the building materials market is soft, in part, because Louisiana’s recession-resilient construction industry is attracting competition among transportation firms.

‘Too many people chasing the same thing tends to make for a rather soft market,’ he said.”

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Wednesday, March 20, 2013

Resurgent New Orleans Attracting Seasoned Entrepreneurs

On March 15, The Times Picayune ran a story about how New Orleans is drawing an increasing number of entrepreneurs and professionals. The full text of the article is below.

Resurgent New Orleans Attracting Seasoned Entrepreneurs
By Mark Waller, The Times-Picayune

“It’s something that growing up, I never could have fathomed,” said Bradley Bain of TurboSquid about the new vibrancy of New Orleans.

It was a common lament among legions of New Orleans mothers and fathers, year after year. For their children to find the best professional and economic opportunities and the best settings to raise their own families, they had to leave. So off they went to Houston, Atlanta and other distant points. People called it the “brain drain,” and it seemed irrevocable.

That is, until now.

First there were the reports after Hurricane Katrina about idealistic, educated young adults streaming in to join the rebuilding and fuel an awakening of entrepreneurship. Now the surveyors of that entrepreneurial landscape say they are seeing a new development: Experienced professionals and veteran entrepreneurs, including New Orleans natives who left in the 1980s or 1990s to build careers elsewhere, are coming back.

Real estate leaders and economic developers say they see it. Tim Williamson, chief executive of The Idea Village entrepreneur support network that is holding its culminating annual event, Entrepreneur Week, over the next several days, held a reception for some of the newcomers and newly returned at his Uptown house in January.

“The purpose of this was really sort of to recognize something is happening,” he told his guests. Almost like an astounded longtime resident accustomed to reports of stagnation or decline, he said, “We’re seeing successful people choosing to come to New Orleans. There really is a huge group of people who are moving here with their families and choosing to move here.”

Williamson said it’s not just an emotional decision because of family ties or the alluring culture. It’s a practical decision, based on the conviction that New Orleans has become a center of opportunity.

A series of guests at Williamson’s party took turns telling their stories.

Among them was Kevin Wilkins, who had a successful career in finance in Boston and married a New Orleans native but only recently and suddenly felt compelled to move here. Also attending was Bradley Bain, who grew up in New Orleans and left for college and technology work in Austin, Texas, before, somewhat unexpectedly, deciding to move back. Neither Michael Bauer or his wife are from New Orleans, and Bauer moved around the country frequently for a career helping start-ups before discovering the potential of New Orleans and moving from Dallas. Carol Markowitz, a corporate finance expert who moved from Los Angeles, shared a story similar to Bauer’s.

Real estate analyst Wade Ragas said it’s too early to discern the movement in demographic details from Census numbers – a general update on Thursday found more than 25,000 people moved to the city from 2010 to 2012 as it crept to 81 percent of its pre-Katrina population, and more than 37,000 arrived in the entire metropolitan area – but Ragas said the reports are widespread from people who work in home sales and relocation.

“The anecdotal information from realtors is consistent with what is being said by The Idea Village people,” Ragas said. “That was not the typical person they saw coming to this market before Katrina.”

“Everyone’s got their fingers crossed, hoping that this holds up,” he said.

Richard Haase, president of the Latter & Blum real estate firm, said his agents are seeing more incoming corporate workers to the city and surrounding parishes, following announcements such as General Electric’s decision to set up a technology office in New Orleans.

“In the last two to three years, we’ve seen a gradual increase in the return of professionals,” he said. “It’s good news. We see it all the time.”

Haase said he thinks the city’s affordability relative to other urban centers and praise in national media for its business climate, economy, tourism preeminence and other attributes are helping drive the interest. “It seems like on a weekly basis I’m hearing or seeing a new top national ranking in a survey or study,” Haase said.

Gardner Realtors Operations President Glenn Gardner makes the same observations. “We do see a lot of young to middle aged professionals looking at New Orleans again more closely as a spot they may want to go,” Gardner said.

Gardner’s own son went to Houston for five years. And then he came back.

Gardner said the thinks a revival in health care is helping. The city lost a lot of doctors after Katrina when their patients scattered, he said, but now it seems to be regaining them.

The size and qualifications of the local workforce present perhaps the biggest speed bumps to this trend, economic developers and technology executives said. They say it still is easier to lure the young and unattached than people who are married and have children. At its annual meeting on Thursday, Greater New Orleans Inc. revealed a survey of companies that found widespread satisfaction with several business conditions, except for the adequacy of the workforce.

Michael Hecht, president of GNO Inc., also said his group is seeing a second post-Katrina wave of arrivals, this time consisting of more established people with families, attracted in part by the cost of living. “You can do better in New Orleans for less than anywhere in America,” he said.

He said demand for experienced workers still outpaces supply, but the situation seems poised to improve gradually. Research gathered by GNO Inc. showed that from 2002 to this year, the New Orleans region gained population in all but two age ranges, people ages 15 to 19 and those ages 45 to 50. The 25 to 35-year-old group made the biggest increase.

Williamson said start-ups need an influx of expertise as they mature. And out-of-town investors are watching the trend with interest. If the city keeps attracting people, the workforce shortcomings might change.

Finding a changed city

Kevin Wilkins, 47, was a brand manager for Proctor & Gamble, a marketing vice president for Fidelity Investments and a managing director for the pension firm State Street Research before the BlackRock investment firm bought it. He met his wife, New Orleans native and university administrator Ginny Wise, in college. They lived in Boston, had three children, and thrived there, he said.

“She’s always loved New Orleans,” he said. They visited her family regularly and each time concluded, “There’s no opportunities for us. So back to Boston we went.”

When they came to help family members after Katrina, he said, “We began seeing a different city.” It had a new sense of shared resilience, authenticity and hopefulness, he said.

Tulane University called Wise about a job as vice president of development, Wilkins had flexibility working as an investor after the State Street buyout, and changes in educational offerings in New Orleans seemed more accommodating for their children. For the first time they thought seriously about moving. In 2010, they did.

Now Wilkins works as an adjunct marketing professor at Tulane, operations chief for the Idea Village and a mentor to entrepreneurs in its programs, which he said he loves because it’s “like a Harvard business school case every day.” He said the entire family is delighted with the move, even the children who doubted it at first.

“I’m seeing a maturing ecosystem,” Wilkins said about the New Orleans start-up scene. “I’m seeing more complex companies. While it is a young market, what I’m seeing is it is a very engaged market. It’s really taking hold. It’s real.”

Opportunity suddenly emerges

After his own childhood in New Orleans Bradley Bain, 34, moved to Austin for college, where, he said, “There were so many opportunities, I never left.” He helped start a software development firm and often thought fondly of his hometown but didn’t consider New Orleans a viable alternative for his work.

The tug of home grew when his wife got pregnant. Still, he said, “We never thought that an opportunity would ever present itself.” He remembered New Orleans as a place his parents counseled his older brothers to leave early in their careers.

His mindset changed when he was introduced to TurboSquid, an animation and 3D modeling clearinghouse in New Orleans. He read more about the city’s resurgence. “All the sudden, we felt like it could happen,” he said.

He moved back last year to become a senior software engineer for TurboSquid.

Bain thinks state tax incentives have helped spur New Orleans, but the growth trajectory is young, and it remains easiest to recruit ex-patriates to the city. “I still think there’s a wall to be climbed,” in marketing New Orleans to people without family connections, he said.

In the meantime, he finds it emotionally stirring to watch the city progress.

“It’s something that growing up, I never could have fathomed,” he said.

“It’s really exciting to see how vibrant the downtown scene is,” he said. “It’s better than I can ever recall it. There’s an electricity about New Orleans that hasn’t previously existed.”

Betting on New Orleans

Michael Bauer, 44, senior vice president of global partnerships overseeing much of the operation of iSeatz, a software developer for the travel industry, lacked any family connection to New Orleans. He grew up in Dallas and lived around the country.

“I’ve had the privilege of living in new cities and checking out new cities,” Bauer said. When he visited New Orleans in times past, “I never said ‘I want to move here.'”

When iSeatz recruited him in 2008, New Orleans, closer to the raw aftermath of Katrina, was a harder sell than it is today, he said. He took the job more for the professional opportunity than the setting. Then the city started impressing him with its uniqueness and neighborliness.

His wife and 8-year-old daughter embraced it. Bauer watched with amazement as buildings were renovated, new restaurants and other businesses appeared, parks were better groomed, people stopped seeming surprised that he moved to New Orleans for a technology job and a “that’s just the way it is” attitude faded.

“I certainly am betting on the city,” Bauer said.

A place to have an impact

Carol Markowitz, 37, also had only a tangential tie to New Orleans. She was raised in Los Angeles. Later her mother moved to Baton Rouge and Markowitz got more familiar with New Orleans. She moved around for her career in corporate finance, working for a telecommunctions firm and eventually returning to Los Angeles to work for clothing and beauty retailers.

Then her husband, a music composer and producer, was ready for a change of scenery, she said. They sought a less expensive city and one closer to family. She started hearing the rave reviews for New Orleans.

“I was so excited by just how much stuff is going on,” he said. They moved in 2011.

Markowitz took time off to take care of their two young children. Then she discovered The Idea Village and became an entrepreneur-in-residence, consulting start-ups. “Part of the draw for me was moving where I felt I could have a bigger impact on the community,” she said.

She’s nearing the end of her residence but says the city abounds with opportunities. She’s getting involved with civic issues and wants to examine innovative solutions to the still persistent problem of crime. “The reality is just that we have to make a concerted effort to be sure we’re not seeing a tale of two cities here,” she said.

A welcoming business climate

Chris Mangum, 45, is from Arkansas but worked in Atlanta for 20 years for BellSouth and in venture capital before moving to Monroe as an executive with the Century Link telecommunications firm. His wife, who’s from New Orleans, was recently pregnant with their first child, and he craved more entrepreneurial pursuits. So he studied her hometown.

What sold him on the strength of the New Orleans market was a scene he spotted walking by the iSeatz office in the Warehouse District on the Friday evening before the 4th of July holiday. In the windows he saw programmers diligently working and then putting up a cheer when they met a deadline for a client. Having such dedicated people is key for start-ups, he said.

He moved to New Orleans in September and became and investor and partner in a start-up, Gotointerview.com, that offers an online job placement service for hourly wage workers.

“I cannot think of a better place to start a business,” Mangum said. He finds the entrepreneurship community more welcoming and nurturing than in more mature start-up hubs. “It’s very tight knit. The Idea Village has done a very good job of weaving together that fabric and being a focal point for it. It seems like all the cylinders are hitting for this entrepreneurial area.”

The city still needs more high-level corporate jobs and more investment money for start-ups in later stages of development, Mangum said, but he expects growth will attract them.

“It’s like a gumbo recipe,” he said, quickly adopting local analogies. “Right now it’s still at the roux stage. If you get this part of it right, the rest is going to be great.”

And he said, “The lifestyle here is hard to beat. It’s just a cool, cool place to live.”

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