“There are thousands of businesses in the Milwaukee area that have real potential to grow.”
A few months after the three-day Driving Economic Growth through Entrepreneurship Ecosystems(DEG) program, we sat down to speak with Jerry Jendusa, co-founder of STUCK, an advisory group that coaches and invests in small businesses. Prior to founding STUCK, Jendusa was the co-founder, chief executive officer, and chairman of the board for EMTEQ for more than 18 years. During his tenure, the aerospace electronics company went from a basement startup to an international aerospace business with 630 employees and more than $100M in annual sales.
What is the economy of Milwaukee like and what economic opportunities are you trying to create in and around the city?
If you ask most Americans what they think of when they hear the name Milwaukee, they think of the beer and the breweries. However, the greater metro Milwaukee area is more diverse than most people think. We have businesses that range from major insurance companies like Northwestern Mutual to major manufacturing companies like AO Smith, which manufactures water heaters. There also are thousands of small and mid-size businesses in the Milwaukee area that have real potential to grow.
On a personal level, having grown up in Wisconsin, I feel lucky to have caught a few breaks when starting my career. I see it as a responsibility to shed some light on some of the mistakes I made when starting EMTEQ as well as share some of the decisions that eventually enabled EMTEQ to grow and employ more than 600 individuals.
STUCK has been one vehicle through which my colleagues and I have been able to set up coaching programs for small business owners who are looking to scale their business. Many small businesses spend a fair amount of time sorting through how to raise capital and manage shareholder agreements. While these aspects of a business are essential, at STUCK, we really try to work with companies to help them refine their strategic plan and deploy accountability measures that are centered around people and customers. Sometimes this means developing product innovations that enhance customer relations, and other times this means talking with CEOs about the benefits of delegating decision-making responsibilities to individuals and technicians who can provide additional value to their business.
In addition to providing coaching services, we do have a side of STUCK that takes on an investment role. This is part of STUCK Fund I. While investing, we partner with the current leadership to develop and deploy fundamental and pragmatic growth strategies.
There are multiple ways that regions try to grow their economies. Why do you think it is important to develop an entrepreneurship ecosystem?
On a more macro level, coaching and individual angel or venture capital investments have limited returns if there are not multiple stakeholders working together to change the local mindset. Given the national acclaim of some of the startups coming out of Silicon Valley, many cities in the U.S. have invested in creating innovation spaces for young startups, many of which have fewer paying customers. Oftentimes, startups spend more time looking for new investors and raising capital than developing new products or finding new customers.
In Milwaukee, several of us are working with Dan Isenberg and the founders of Scale Up Milwaukeeto bring multiple stakeholders together to reframe how business and policy leaders look at growth. At its core, Scale Up Milwaukee is a coalition of local, regional, and national partners who want to infuse Milwaukee with dramatically increased growth entrepreneurship. One part of Scale Up MKE is the scalerator program that supports the growth of companies that have an established customer base and somewhere between $1 million and $10 million in revenue. We know that many of these more established startups and small businesses will be major job creators for the Milwaukee area the more they have the chance to collaborate and learn from seasoned entrepreneurs and CEOs.
Recognizing the benefit of challenging all stakeholders to reframe how they look at growth, Scale Up MKE and Dan Isenberg frequently engage with CEOs from larger publicly traded and privately held organizations in the Milwaukee area. Our CEO roundtable forums provide a space for CEOs to discuss how they look at growth and how to trade best practices on items such as innovation, entrepreneurial cultures, and M&A.
Looking back at your time at Babson at the end of the DEG program, what new idea or tool have you taken back to Milwaukee?
Through the DEG discussions and breakout sessions, I learned that partnerships and education go hand in hand. Great things happen when entrepreneurs, bankers, lenders, lawyers, educators, and policymakers share a common language and a common goal of supporting companies that have the potential to grow quickly.
For the simple example of Scale Up MKE’s scalerator training sessions, we are excited to say that out of the 27 companies that participated in the program, we are expecting to see 224 jobs added by the end of 2015. We know that an ecosystem built to support these growing companies will put them in a better position to scale and a better position to pay back investors and the community at large. Some of the participating companies will clearly site their training as the main reason for the accelerated growth of their business.