The ‘Rising Tide’ Boosting Biz Owners
WHEN Alfa Demmellash left her grandparents’ home in Ethiopia to join her mother in Boston at the age of 13, her family told her that “America is like the land of milk and honey where you will never have to worry again.”
Though she had escaped great misfortune, leaving behind a civil war that had claimed the lives of many relatives, Demmellash still had plenty to worry about. Her mother struggled to earn enough money. So she went to night school and started sewing and selling traditional Ethiopian dresses to bring in something extra.
It wasn’t easy. And like many children of immigrants, once Demmellash arrived she helped her mother navigate the ins and outs of doing business in this country. Now more than 20 years later, Demmellash is helping other budding entrepreneurs do the same thing.
Her organization, Rising Tide Capital, which was launched in 2004 in Jersey City, has helped almost 1,400 entrepreneurs understand the nuts and bolts of starting a business — from dealing with a maze of government regulations to teaching them how to price their product to showing them how to apply for a business loan. On Monday night, Rising Tide will receive one of the Manhattan Institute’s awards for Social Entrepreneurship. It’s hard to imagine a more deserving organization.
Half of the graduates of Rising Tide’s 12week Community Business Academy already have their own businesses, and the other half are in the planning stages. The average entrepreneur served by Rising Tide is a 40-year-old single mother of two, living on an income of about $35,000 a year in an area where the cost of living for her family is closer to $50,000.
When Demmellash was in high school, she noticed her mother was under-charging her customers. Her mother dreamed of her own dress shop, but she was too intimidated to pursue it. Demmellash would take her mother to get advice at a women’s business center, but she “walked away with a checklist the size of Texas. She would say, ‘Oh, I’m fine doing it the way I’m doing it. The world of business is not for me.’ ”
Demmellash, who attended Boston Latin high school and graduated from Harvard, decided to start Rising Tide Capital with college classmate Alex Forrester, after the two saw just how few resources there were for people who aspired to start small businesses. While there was an economic boom on Jersey City’s waterfront, they worried that its effects weren’t being seen in other neighborhoods nearby.
“A rising tide may lift all boats,” Demmellash tells me, “but what about the people who don’t have a boat? We have to build more boats.”
On average, business owners who have completed Rising Tide’s program have seen a 64 percent increase in sales and a 47 percent increase in income. Use of public-assistance programs by participants declined, from 27 percent to 12 percent.
Demmellash says programs offered by the Small Business Administration often miss “a vast pool of people who are energetic and talented.” She says the problems are much smaller and more practical than you might think. “I can’t tell you how many times I’ve sat down with someone who is too intimidated even to get their employer identifica- tion number from the government.”
Take Pamela Roundtree, who came to the Community Business Academy four years ago to get help with her fitness and nutrition business, New Body, New Mind, New Living. She didn’t know how to measure “how much money you have going in and coming out, how much money to use for marketing or products or rent.”
Geoff Allen had previously started a trucking business in 2011, but, he says, it failed in part because of the economy and “in part because I didn’t have the right tools or the right people to help me.” Thanks to Rising Tide, though, his handyman business, Property Maintenance Guys, has been a great success. Rising Tide’s mentors worked with him for eight weeks getting ready to apply for a loan. Now he’s so busy he has had to turn down contracts.
Allen says he regularly calls his instructors from Rising Tide with questions. But in a fitting turn of events, Rising Tide sometimes needs a handyman. So they call him, too. He’s only too happy to return the favor.