Justin Hernandez (left), owner of New Generation Construction, talks with Region VII Advocate Becky Greenwald outside St. Michael's Catholic School in southeast Lincoln.
He couldn't see himself working in an office at his father's Ford dealership, so Justin Hernandez started his own construction company.
And he'll tell you he had a knack for timing, he admits with a laugh, starting his business in early 2009, in the teeth of the worst construction crash in several generations.
Yet today, New Generation Construction is an up-and-comer in the Lincoln area with a name that describes their approach to their clients.
Hernandez was tossing around names for his firm with a friend of his, who thought about the way the company was integrating new technology and new ways of thinking into a new generation of construction ownership. "And I’ve been a believer that it’s not one person who is responsible for our success, it's something that incorporates everyone on our team, so we had to have 'group' in there somewhere."
Bursting portfolio of spectacular projects
New Generation Construction began with four full-time employees; today, reflecting its astounding growth, there are 14 full-time and two part-time workers in the firm.
As their web site claims, New Generation Construction is recognized for its strength in traditional construction methods and for its creative approach to state-of-the-art technology and delivery systems spanning the construction industry spectrum, from small renovations to million dollar projects. They boast an attractive portfolio of projects ranging from general contractor work on the Alloy Strength Complex for the University of Nebraska Cornhusker athletic teams, one of many projects for the college over the past two years, to the interior finish for a gleaming, new dental practice. The firm has done renovation and upgrade work on an MRI suite for St. Francis Medical Center in Grand Island; and, working with Shanahan Mechanical & Electrical, they are in the process of constructing a 2.8 million gallon thermal energy storage facility for the University of Nebraska .
Then there's St. Michael's Catholic School on the southeast side of Lincoln. This 55,000-square-foot edifice now rises from south of Yankee Hill boasting nine comfortable classrooms, a library, computer lab, parish and faculty offices, full commercial kitchen and bright, airy 10,000-square-foot gym.
New Generation Construction completed the work on the parochial school in just 9-1/2 months, and "way" under budget, said Jerry Sukup of Heartland Community Bank in nearby Bennet. "Nobody thought he could finish it by the time school opened."
Turning to the SBA for a line of credit to fuel further growth
Sukup himself is a parishoner of St. Michael's Church, and it was during a tour of the construction work led by the parish priest that he ran into Hernandez.
"Lincoln is a small place, you kind of run back into people you've worked with before," he said. The two had worked together when Sukup was at a previous lender, and he couldn't help but impressed with the work New Generation Construction had done.
Hernandez mentioned to Sukup he could use a larger line of credit to continue to tackle the larger construction jobs around the state, and with Sukup's help, moved his business financing to Heartland. After a discussion of what structure of deal would help the business and work best for the lender, and the growth and potential of the firm, Sukup decided to turn to the SBA to guarantee the loan, and to Suzanne Stearman, a lender relations specialist at the Nebraska District Office, for help.
Heartland had done only two SBA loans recently, a landscaping firm in Nebraska City in March 2010, and a custom window manufacturer in Lincoln in August 2011. New Generation Construction would be the third.
"Suzanne is always great for us," Sukup said. "Sure, she pointed out the forms were available on the SBA web site, but she went beyond that by offering to send us what we needed. The first time I submitted the information through ETran (the SBA's electronic loan processing software) on this deal, I got a few errors, so I called her, and she walked me through it."
As a result of Sukup's work and Stearman's help, New Generation Construction was approved Jan. 17 for a $300,000 revolving line of credit using the SBA Express program.
And this deal may not be the last SBA application for Heartland.
"There are several SBA deals for people I have worked with in the past that we’re looking at, maybe six or seven that would fit perfectly into a line of credit or an Express loan," Sukup said. "We’re on that slow and steady growth here, and we’re always looking for more deals."
Especially if they have a chance to help a young, energetic small business owner.
Didn't let economic slump discourage him from starting his own company
Hernandez's father owns a car dealership in Beatrice, some 40 miles from Lincoln in the southeast part of the state, which he purchased back in 1997.
"He wanted me to come work there but I couldn’t stand being in the office," Hernandez said.
So he started "a concrete and landscape business right out of high school," an effort he continued through college toward a degree in construction management and business management, repairing and pouring concrete for driveways on the weekends, working between classes on grading work for residential and commercial lots.
"There was a lot of work to go around and I found a niche," he said.
He picked up a job with Landscapes Unlimited constructing football fields and soccer pitches all over the country, and sold off a large portion of his landscaping business while working for that firm. After working for three years, he tired of the travel and living away from home, so he returned to work for a Lincoln-area construction firm
By the end of 2008, he determined he had enough experience working for another firm and decided to go out on his own, right as the industry slumped.
"Every banker told me I should just go work for somebody," Hernandez said. "I said to myself, 'well, if it doesn't work out, at least I know.'"
But Hernandez leveraged the reputation he'd built with several clients while working for the Lincoln construction company, and worked his way up from very small jobs in 2009 to multi-million dollar projects by 2012.
Hernandez also works hard to be a responsible corporate citizen. "He’s been involved with very unique, green projects reusing and renewing material for projects," Sukup said.
While the line of credit will help, Hernandez said key to continued growth remains the relationships he forges between his company and his clients.
"That's been our biggest asset," he said. "We do more with less with our projects, and we look for more efficient ways to do the same tasks as our competitors on time and under budget. Our growth has been more than what we had anticipated, but now that we have a few things in line we’re ready for the next step."
Melissa Hagerty (left) and Sharon Hansen (right) of Nothing Bundt Cakes, shortly after their store opening.
The new franchise store in an Omaha shopping center would open in about a half hour, with a line of eager customers already snaking around the building, not seeming to care about the morning chill or the raindrops pelting down on them. They’d heard a lot about the grocery store’s unique and exotic offerings, and they wanted to be among the first in town to see inside.
Another franchise store across the parking lot with tasty treats of its own was having an opening that morning, and one of the new owners saw an opportunity.
“We went out there and offered free samples,” said Melissa Hagerty, a co-owner of Nothing Bundt Cakes’ newest franchise in Omaha. “And we said, ‘when you’re done shopping, come over and see us.’”
They did, helping the store pull in $2,600 in sales for its “soft” opening Nov. 12, 2010, a record, Hagerty said, for first-day revenue of any of the 16 shops in the Las Vegas-based confectionary chain.
Smells so good you can almost taste them
Those customers found that Nothing Bundt Cakes meant exactly that: the cheerful, nostalgically decorated store offers the ridged, ringed cakes in four sizes and 10 flavors, from tasty little bite-sized bundts to huge cakes that can satisfy a crew of 18. They bake each cake in large ovens in the back of the store, filling the place with delectable and irresistible scents.
“When we have our ovens going, people walk in the door, and you can see them leaning back, going, ‘aahhhh!’,” said Sharon Hansen, the other co-owner of the shop.
And Nothing Bundt Cakes goes all out, with delicious icing melting into the sweet spongy dessert, topped off with colorful bows and silk flowers. They aim to be a one-stop shop for party planning, with aprons, platters, party hats, balloons and cards.
Taking a bite out of the confectionary market
Hegarty worked with her co-owner, Sharon Hansen, at a locally-owned Omaha business furniture dealership for four years. Hansen had lived with her husband in Las Vegas and knew how treasured there a gift from Nothing Bundt Cakes could be. Returning to the Midwest about five years ago, she investigated bringing a franchise to Nebraska.
Nothing Bundt Cakes started in a home kitchen back in 1998, and by 2007, the original owner franchised the concept to several western cities from Nevada to Texas. The Omaha store is the Midwest’s first.
Hansen and Hegarty incorporated under the name Hole Lotta Yum, LLC – the name is a nod to the marketing tag line for the franchise. They sought business plan help in Oct. 2009 from the Nebraska Business Development Center in Omaha at the suggestion of their banker, Steve Davis of Elkhorn’s CharterWest. The business was approved March 17 for a 7(a) loan for $253,600, which they used for baking and refrigeration equipment, leaseholder improvements and buildouts, and the franchise fee.
Marketing their delectable products was easy
Hegarty and Hansen have been aggressive marketing the new store. Drawing on their previous experience at the business furniture dealership, the two asked their former colleagues to take sample cakes to their clients, and in October 2010, their booth at the Buy the Big O! Show at the downtown Qwest Center drew consistent crowds all day seeking a mouthful of bundt cake.
“With our opening so close, we used the show to get our name out there,” Hansen said.
“We’re involved with the Greater Omaha Chamber and we know how important it is to building a business,” Hegarty added.
Nothing Bundt Cakes also got a mention on KFAB-AM’s Saturday economic development program, Grow Omaha. The hosts asked if a business could succeed selling just bundt cakes – Hegarty and Hansen answered by sending a cake over to them to sample.
“We’re seeing a real return on investment for marketing,” Hegarty said.
With representatives from the Greater Omaha Chamber invited for a ribbon-cutting and the date looming for the store’s grand opening Nov. 19, 2010, Hansen said the challenge “was getting all the parties involved and everyone together to understand our timing.”
“We found ourselves really pushing people, because it was so important to open our doors on time,” Hegarty said.
When the doors opened that rainy Friday morning, the hard work paid off.
“Every time we turned around, there was somebody here to help,” Hegarty said, including their former colleagues at the furniture dealership; during a customer open house, they bought several cakes from the store.
Hansen said even in a depressed economy, “people will stand in line 30 to 40 minutes for our cakes. They’ll say, ‘even though we don’t have a lot of money, this is something we can afford to treat ourselves.’”
She added the store’s goal was $500,000 in sales for its first year, with a hope to exceed that.” The franchise’s other stores, including in recession-wracked Las Vegas, have shown 20 percent year-over-year growth.
And with the scents and tastes of each cake fresh out of the oven, it’s pretty easy to understand why Hansen said she’s “just happy to come to work every day. It’s fun, and we love to share that.”
Four years ago, Sandhills Glass and Garage Doors was on the verge of closing for good. These days, not only is business booming, but Bradley and Gina Babb, the owners of the Ord, Neb., business, were in Washington, D.C., a couple of years ago up on a dais with SBA Administrator Karen Mills.
How they got there is quite a story.
The Association for Enterprise Opportunity (AEO) sought four outstanding small businesses to shoot a documentary for its new web site showing the importance of microenterprise development across America, and Gene Rahn at the Rural Enterprise Assistance Project (REAP) had just a business in mind. That business would get attention far beyond its Loup Valley home.
Some 14 years ago, Bradley took a job with Sandhills Glass; his step-father wanted Bradley to take over the business when he retired. Tragically, before the business could be passed on, Bradley’s step-father died. Worse, the company’s other partner didn’t want to keep the business open, preferring to sell and dissolve the corporation.
But the Babbs didn’t want the story of the business to end there.
After working together to come up with a business plan, Bradley and Gina approached First National Bank in Ord. Though they got a loan from the bank, it wasn’t enough to complete the deal.
“That’s when someone suggested we go talk to REAP,” Bradley said. “They were able to give us the last piece of the puzzle.” REAP’s Gene Rahn packaged the bank loan with a microloan from the Ord Revolving Loan Fund and another from REAP, enough to re-open Sandhills Glass in the summer of 2008, nine months after it closed.
“Without these funds,” Bradley added, “we wouldn’t have a business. Without them, maybe we would have moved out of the area and done something different.”
Other community organizations in Ord were crucial in re-opening the business, including the Ord Area Chamber of Commerce and the Valley County Economic Development, which has made more than $1.5 million in microloans to area businesses since 1996.
From cutting a small piece of glass for a picture frame up to a new contract to install all garage doors, windows and entranceways for the Ord Volunteer Fire station Department, Sandhills Glass is as successful as ever. The business also handles all types of auto, tractor and other machinery glass, flat glass, mirror and plexi-glass work and repair, even repairing screen windows and putting in storm doors and show doors. Bradley completes the shop work, installation and repair work; Gina handles supply and equipment purchases, inventory control and helps with sales.
Sandhills Glass returned to Valley County Economic Development for funds to buy a scissor lift for a large local contracting job.
“Business has been doing fantastic,” Bradley said. “I had worked here for 10 years and knew the business in and out. I was a little bit leery when we shut down, even though I thought people would come back. They have and we've been busy every since.”
Since re-opening, the business has hired one full-time employee and another part-timer, and may hire another full-time employee sometime in the future.
Sandhills Glass subsequently was recognized in Feb. 2010 with the Center for Rural Affairs Entrepreneur Award, and they’ve been mentioned in several nationwide home and design magazines.
One day Rahn surprised the Babbs with some news: the Center for Rural Affairs would fly the Sandhills Glass owners to Washington to represent small business recipients of microloans at the AEO’s national conference.
So there they were in May 2010, on a dais, telling their story.
“We loved every minute of it,” Bradley said. “It was such an honor to represent rural business. That's something that's very important to us.” And it was important for conference-goers to hear the story straight from the Babbs; rural small businesses from the heartland who receive microloans often don’t have the chance to tell their story in person to Washington decision-makers and supporters.
The help from microlending programs also led to Sandhills Glass hiring more people, creating jobs for their friends and neighbors in Ord, and a glimpse of how a small business loan can be such a huge lift beyond mere figures on a balance sheet.
And there’s even potential for a happier ending to the story: With their business success, the Babbs are seeking to start an apprenticeship for young students in the area wanting to learn a trade.