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Nebraska District Office
10675 Bedford Ave. Suite 100
Omaha, NE 68134
United States
Phone: 402-221-4691
Fax: 402-221-3680
Hours of Operation:
Monday through Friday from 8:00 AM to 4:30 PM

Navy veteran starts own firm to get small business clients smart with healthy financial habits

How does someone go from running a power plant aboard a U.S. Navy ship at sea to guiding small businesses in Nebraska through their bookkeeping snags?

Russ Cowan knows.  As the owner of Money Smarts Inc., in Lincoln, he offers custom-tailored services to help area entrepreneurs think beyond the numbers on the balance sheet to make better business decisions for long-term success--all within his customers' tight budgets.

"We've seen some success stories when some businesses are on the verge," Cowan said, "They come to us knowing that they have to fix something or close their doors, and many have been able to turn things around, and are growing, so it’s kind of fun to see it all actually work."

Finding his way from a Navy career to a financial business

But when Cowan enlisted in the Navy more than 20 years ago as a machinist mate, then a boiler technician, he had in mind making the next stripe over poring over spreadsheets matching revenue and expenses.  He attended the University of Nebraska at Lincoln as part of the Navy ROTC program, but he hurt his knee which cut his career as an officer short.  Still, he graduated with a degree in natural resources sciences, with an emphasis in hydrology.

During college, Cowan picked up a job in retail management, and later worked at H&R Block doing tax returns for five years.  Something clicked as he discovered something he liked to do, and eventually, he earned a degree in accounting from Doane College.

After working at a Lincoln-based CPA firm, Cowan moved on to serve as an accounting manager for a real estate company before moving up to operations vice president.  But something bothered him.

"Most accounting companies will handle their small business clients by an hour worked being an hour billed, so each time you call, meet with or have work done by your accountant or the staff, you pay for it," he said. 

Mentoring small businesses to success

So about five years ago, he asked himself: "What would happen if I opened a company that gave out information to its clients without constantly watching the clock?"  Too many times, Cowan said, business owners will not ask questions or discuss their thoughts about their operations to their advisors simply because each answer is billed by the hour.

"Because of that, business owners are forced to go it alone, learning the hard realities of bookkeeping and tax compliance on their own," he added. "Over the last two decades while working at other firms I had watched many small businesses fail due to a simple lack of knowledge."

Cowan discovered a business model of his own, where instead of seeking clients who could pay his per hour rates, he would work perhaps an hour or two a month for each small business customer and make enough on volume.

Money Smarts often will pick up a client's customer data and prepare monthly, quarterly or annual reports as needed, and personally review them at their customer's location. If a small business doesn't have time to meet with Cowan personally, he has set up a web-based management system that allows customers to view details on their account, download and upload important documents, or just as ask a question or two.

Turning to an SBA microlender to help grow the firm

Money Smarts proved so successful that by the end of the 2009 tax season with 34 clients and more referrals coming fast and furious, Cowan, who already had hired a bookkeeper to help, realized that he would have to bring aboard an accountant to continue to grow the business.  He turned to Community Development Resources (CDR) in Lincoln, an SBA microloan program participant, for a $5,000 loan for working capital to help pay for the new employee and for additional licenses for the software the firm uses.

The SBA's Microloan Program provides small, short-term loans to small businesses through specially designated intermediary non-profit community-based organizations such as CDR with experience in lending as well as management and technical assistance.

As a result of the microloan, the company doubled its client base in one year and expanded its staff to five people.

"Sometimes it’s having enough money to relax, focus and continue to move forward," Cowan said.

In 2012, Money Smarts took out another microloan, this time for $3,500, helping to bring aboard an administrative assistant and to allow them the ability to serve more small businesses with accounting needs.  Two months later, Cowan claimed the company grew by 20 percent, and expects nearly 50 percent income growth for the year.

"We’ve managed to double our clientele almost every year," Cowan said. "I expect some year it’ll taper off but it hasn’t yet."

If it seems as if Cowan runs a tight ship with his business, that's no accident.

"My goal in the service was to be a surface warfare officer and eventually have a ship of my own" Cowan explained.  "When I was an employee in different industries, I would tell people nothing equates to having your own thing.  That's what this business is, this is having your own ship.  What I draw from that experience for the business is that there's a right way to do things and a way to get things done. It wasn’t about giving orders, it was about putting yourself in a position to be respected by your peers. I don’t boss people around, they see the work I do and they respect me for it, and it makes it easier to run this company."

From downsized to opening a new trendy Omaha nightspot: Nosh Wine Lounge

So there she was, downsized from her corporate finance job in the Dallas area the day before, out with her friends, wondering what would be next in her life.  She was over 50, without a job, although she was more fortunate than many in the recession with a severance and some stock options.  But she did have a thought.

“I always wanted to open a bar,” she said.  “I’d go into places, look around, think about how maybe I’d do something a little different than what they were doing.”

And there, out with her friends that night, was one of them exclaiming to her: “You should do that!”

Lila Anderson and Nosh Wine Lounge

Lila Anderson at Nosh Wine Lounge at 10th and Dodge in Omaha.

A little more than three years later, Lila Anderson’s place, Nosh Wine Lounge, is a staple of the new Capitol District in downtown Omaha.  Within walking distance of the CenturyLink Center, Holland Performing Arts, the new TD Ameritrade Park and gathering foot traffic from several downtown hotels, the intimate setting boasts this urban destination as “the place for friends to gather, relax and celebrate good times.”

“A group can hold a nice sized event and have the whole place to themselves,” Anderson said as she took a break from planning to host a large party for a group from ConAgra.

Want to browse from more than a hundred wines to sip?  How about artisan beers, cocktails and gourmet sliders and flatbread pizzas using locally-grown organic produce?  There’s live entertainment, a VIP area and a private tasting room, and patrons can join a wine club, where members receive two personally selected bottles of wine each month.

Meeting a demand for a unique place

“People are kind of hungry for this,” Anderson said.  She’s seen Nosh Wine Lounge packed for events for singles, including an event in conjunction with the dating site Match.com.

Her family wanted her to move back to Omaha when she lost her job with TD Ameritrade in Texas, and soon discovered her old hometown lacked anything like she wanted to create.  After looking over available franchises, Anderson decided to hire a business consultant, the former president of the Omaha restaurant association, to get help with a business plan.

“That was in 2009,” she said.  “Banks were really tight with money.”

So she smartly put her idea on hold, working for a year as a branch examinations analyst, until she got financing for her idea thanks to an SBA Rural/Small Lender Advantage loan approved Aug. 31, 2010, through First Savings Bank for $150,000 to cover leaseholder improvements and construction to build a bar and kitchen from the ground up.

“I did have many people warning me about the recession, but I think I got in at a good time,” she said.  “My lease was low, and there were a lot of good people looking for work.”

Going through the growing pains of a new business

And as she discovered the hospitality industry was different than the financial services industry, her business plan hit a snag.

“Because I managed 300 people at TD Ameritrade, I was used to working with people who all knew what needed to be done,” she said, “so I figured, hire people to do what needs to be done and that’s that.”

Instead, she had to let go the first manager she hired after only six weeks, and replaced him with the lead bartender.  He could sell wine, “but I had to let him go after four months.  I was learning every time I had to let someone go, I had to take on more responsibilities as a result.”

Anderson admitted the first six months in business “were really hard and there were many times I was wondering, ‘what am I doing here?’

“But here we are.  The last six months have been comfortable and we’re where we need to be,” she said.  “If I can say one thing, don’t give up.  There were so many struggles for this business in the first six months.  I had to learn I had to fire people, but then I was struck afterward how I was going to make this work without them.  So my piece of advice is to learn everything you can before you start.  I thought if I just had everyone in place I’d be set. Now I know what to look for in getting the right people.”

Anderson had a degree in finance and was an operations director with TD Ameritrade in Texas.  But that didn’t prepare her for the unique challenges of tracking costs and budget for a small business; she relied on her employees to keep costs in line, then ran into a little trouble when the books got out of control.

“Now I do the budgeting and ordering so I have such a better idea on our costs,” she said.

Her advice: get out and promote

Unlike before she opened the doors to Nosh Wine Lounge, Anderson also finds it tough to make time to network to grow the business.

“I’m telling you, you have to work it all the time, I figured a good place with good food and good service, things would go great but you have to be out there and promote, promote, promote.  It’s hard to find the time, but it’s a great resource if you can build a network.”

She’s also looking into leveraging social media to help attract that crucial foot traffic and promote her place’s specials and events.

Still, she’s doing well, $45,000 to $50,000 in sales per month with the help of a full-time chef and three part-time kitchen employees and six part-timers handling customers out front.

“Would I do it all over again, if you would have asked me that six months, a year ago …” she trailed off.  “If you ask me now, yes, absolutely. You have to stretch yourself, grow.  I think a lot of people don’t have these opportunities to go out and do your own thing, and I wouldn’t have had it if I hadn’t gotten downsized from TD Ameritrade.

“Who knows,” Anderson added, “if my friend hadn’t said, hey you should really open up a bar, who knows when or if I would have done this.”

 

Trading the executive job for the blank canvas of a business start-up

Tucked in the trendy AkSarBen Village, within walking distance of a park, shops and coffee sippers is what Kathy Byrnes hopes is to be one of Omaha’s hottest fashionable merges of gallery, retail and creative exploration.

Village Canvas and Cabernet offers a gallery featuring local artists’ works for sale on consignment, and a small wine, beer and coffee bar off to the side for browsers.  While the space also will be available for private parties, the best part, and the linchpin of the business, is an artist who will lead fun and entertaining painting sessions to help guests craft their own unique works. 

“I hope we can have the space for people to explore their creative side and potentially discover their inner artist,” she added.

Kathy Byrnes (center) of Village Canvas and Cabernet

Kathy Byrnes (center, in tan jacket) during the opening of Village Canvas and Cabernet Sept. 14 in Omaha's AkSarBen Village. 

It’s a natural progression for Byrnes, who, along with her husband, are general partners of the Hot Shops Art Center, a collection of artist studios and galleries north of downtown.

About 13 years ago, Byrnes recalled working in the health promotion area of The Nebraska Medical Center, enjoying a coffee break with a co-worker.  As both of them daydreamed, lost in conversation, they asked each other:  What would you do if you could do anything you wanted?

“I answered, I saw myself in a flower shop or a coffee shop surrounded by unique gifts and things I love,” Byrnes remembered.

That would be a departure from a career she started while still in high school, soliciting volunteers for door-to-door work for the American Cancer Society.  

After earning a degree in community health education and a master’s in public administration from the University of Nebraska at Omaha, Byrnes eventually found her way to head a non-profit firm, Executive Service Corps Nebraska, which counted as its supporters some of Omaha’s biggest names in business, helping smaller community-focused groups get their start.  Finally, after the age of 50, she gave up her full-time career as the CEO for the non-profit Prevent Blindness Nebraska to work on the next project in her life.

And it started on a holiday visit with family in Denver.

“My sister-in-law took me to a place where you paint pictures,” Byrnes said. “I had a glass of wine, we were just following the instruction from the artist, and it was amazing, our talents came out in what we were doing.  So she turned to me and said, ‘you should open something like this in Omaha.’”

Byrnes had long since put her idea of a shop surrounded by flowers and coffee aside, but that visit planted a seed.  On the seven-hour drive back to Omaha, she discussed the potential venture with her husband; upon returning home, she got to work.

As she put together a business plan with his help, she scouted locations from office buildings to shopping malls, finally settling on a 2,000-square-foot place on a first-floor corner in AkSarBen with enough foot traffic to make it work. 

“There are about 300 of these types of businesses across the country,” Byrnes claimed, “and I eventually visited four of them in Colorado, seeing what they do, getting a better idea on what I wanted to do with mine.”  

She took her plan to Dundee Bank, a branch of Security State Bank in Omaha, where she was approved April 6 for an SBA Express loan.  The process of applying for the SBA-backed commercial loan reminded Byrnes of her non-profit experience completing grant applications—“the process was similar, you just have to know where to find the information they’re asking for.”

What was daunting was the leap of faith she had to take, that everything needed to open her business would happen.  With the line of credit in hand, she began working in May and had it in mind to open in June; except considerable work had to be done on the leased space to turn it into her business, pushing to mid-September before she could open her doors.

“That was the scary part,” she admitted.

Ribbon cutting with Omaha Mayor Jim Suttle and Larry Gomez of the Greater Omaha Chamber of Commerce to commemorate the opening of Village Canvas and Cabernet.

Ribbon cutting to commemorate the opening of Village Canvas and Cabernet, along with Omaha Mayor Jim Suttle and Larry Gomez of the Greater Omaha Chamber of Commerce.

“I think being over 50, I have the experience to know what I don’t know and to surround myself with people who can help me,” Byrnes said.  “I know what I’m best at and what I’m not so good at.  I think with that experience, there’s a greater comfort level to admit I need to get the right people for advice and help.  For example, I’m not an artist, and if I don’t get the right artist to lead our art classes, it could really negatively affect the business.  We’re always learning.”

To help her start-up succeed, she also took a marketing workshop from the Nebraska Business Development Center, “and I plan to do more with them,” she said.

Byrnes will hire up to five part-time employees, not including the artists she’ll bring in as  independent contractors as needed.  She’s also reaching out to UNO to attract interns who want to learn how to teach art or gain real-world business experience.

Moreover, she’s not done working with the non-profit businesses in the area.  “I’ve embraced it as part of our mission,” she said.  “We have three ways here to help smaller non-profits, from providing a meeting space, providing donations and hosting fundraisers.”

As Byrnes traded the job as an executive for the blank canvas of starting a small business, “I never in a million years thought I’d be an entrepreneur.

“You know, I can really feel good when I walk in here every day, knowing I established a great place where guests feel inspired to explore their creative side so many of us don’t explore.”

 

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