Demo day marks completion of second ScaleUp Ozarks

Thirteen Arkansas companies displayed their wares Sept. 29 in downtown Fayetteville at the ScaleUp Ozarks Cohort II Demo Day, marking completion of the 16-week entrepreneurial education program offered through Fayetteville firm Startup Junkie Consulting and funded in part by the U.S. Small Business Administration.

Participants characterized the program as “game-changing” and said the expertise and relationships they gained will fuel and guide their ventures. Startup Junkie is one of 15 organizations nationwide selected for the ScaleUp America Initiative program, which aims to increase jobs nationwide by bolstering the health of small firms.

The majority of new jobs in the U.S. (60 percent) are being created through small businesses, according to the SBA, but historically small businesses have had fewer resources to grow.

During the public event inside NWA’s Entrepreneurship & Innovation Space at East Square Plaza, the 13 companies offered samples and demonstrations of their products, ranging from wine to organic mattresses and ice cream.

The owners of Springdale’s Black Apple Crossing served cider for the event, while co-owner Leo Orpin characterized the ScaleUp program as “dynamite.”

“I’d be scratching and clawing to find ways to improve the program,” Orpin said, “but for getting the word out. I’m surprised countless, hundreds of companies aren’t applying.”

Orpin knew Startup Junkie through its podcasts before he and his partners applied for ScaleUp. His background is marketing and sales, and he helped launch a craft beer distributor. He and two partners (both microbiologists) launched Black Apple Crossing in 2014, and in 2015 opened the state’s first cidery.

“I had to learn payroll, retail and managing the employee base on the fly,” Orpin said. “I’m more of a big-picture guy, and I was thinking, ‘How do I run this big operation when I’m just a cog in the wheel?’”

Reaching the “what do we do next” phase led the partners to join ScaleUp.

“We had three or four ways to scale up but didn’t know whether to pursue distribution, expand the taproom, or focus our model statewide,” Orpin explained. “The program helped us define our future. We learned the fine details of operations, and — just as importantly — we broke into small groups to discuss best practices and how to solve problems we were facing.”

These small groups were a lifeblood for Margie Raimondo of Raimondo Winery in Mountain Home, who established a small farm winery in 2008 based on generations of winemaking expertise handed down within her Italian family.

“The unexpected game-changer for me was the interaction in the small group with people in my industry,” Raimondo said. “It is very comforting to sit and talk with people going through the same things you are. I realized how hungry I’ve been, as a CEO and small business owner, for that interaction.”

Raimondo so bolstered her network in Northwest Arkansas that she’s now planning to open her second store in the area, sometime next year. Raimondo’s wine bar/store carries her own wine product as well as vinegars, olive oils and complementary products. She also offers cooking classes.

A third ScaleUp participant, Lycia Shrum, opened Blackboard Grocery & Eatery in December 2014 in Fayetteville. Shrum had worked in a similar-concept shop in Austin, Texas, and saw Fayetteville as perfect for a similar one-stop urban market offering coffee, bakery, groceries and other grab-and-go items.

Shrum said she didn’t realize how isolated she had become during the course of her first year in business due to everyday demands.

“In our small groups we could speak very candidly about finances, fears, the emotional side of building a business,” Shrum said. “The ScaleUp classes helped me step back to consider a big picture: Is it time to hire a new person, expand online or introduce a new concept? The program helps you with things you don’t expect.”

Shrum said she is often asked whether the program is worth the 16-week commitment, and she insists any company would benefit.

“It was all very relatable, and I always looked forward to going on Monday nights and to starting my week off positively. If you don’t qualify yet, you can still use Startup Junkie to start those types of conversations and relationships,” Shrum said. “It’s a great resource a lot of people don’t know about.”

A Place for Startups

The SBA has twice awarded $200,000 to Startup Junkie to fund the cohorts. The funding opportunity could reach $1 million over five years.

Other participants in Cohort II included: Absolute Climate Control, Blue Zoo Creative, Cutting Edge Glass Creations, Dance & More Store, Fayetteville Pilates and Barre, Jose Esparza & Associates, Loblolly Creamery, Midtown Eclectic Mall, Mountain Air Organic Beds and Shave the Planet.

Brett Amerine, chief operating officer of Startup Junkie, said the metrics used to gauge the program’s success over time will include job growth; increases in products, services, and solutions brought to market; and increased revenues experienced by participant ventures.

ScaleUp Ozarks is but one of the contributing factors making Fayetteville one of the best communities in the nation to start a business, Amerine said. In 2015, Fayetteville ranked as one of the top three cities for launching a startup, outside Silicon Valley and New York City, according to DataFox, a San Francisco-based deal-sourcing and research platform.

Fayetteville boasts almost 10 times the number of new business ventures compared with other U.S. cities analyzed, in part because of an appealingly low cost of living.

ScaleUp specifically aims to support underserved and underrepresented entrepreneurs, and a large number of participants in the first two cohorts were female, minority or veteran. Participation is free.

Startup Junkie is accepting applications for Cohort III through Oct. 14. The region served by the program includes Arkansas, Oklahoma and Missouri.

The program specifically seeks small businesses with average annual revenues of between $150,000 and $500,000 and that show potential for increasing jobs in the region and bolstering the economy. Over 16 weeks, the program teaches, offers mentorships, provides access to capital and presents networking opportunities.