September 2012 Issue – View From the Trenches
View From the Trenches
Helping Small Businesses Grow – One Balance Sheet at a Time:
An Interview with Nathan Bernard SMG ‘12
Having graduated this spring from the School of Management, Nathan Bernard’s four years at BU gave him the confidence to move beyond the protection of the campus and his peers, into the community, to apply the skills he was taught in the classroom. It was then that he truly learned how to make an impact in “the real world.“
By observing the business world and seeing the difficulties that plague small businesses, Nathan formed a financial literacy program known as BUBA, BU Urban Business Accelerator. The initiative prepares small business owners to manage their money and address key financial challenges that are a part of every small business through empowering them with financial knowledge and technical help. Often times these small business owners are unprepared to manage the day-to-day cash money challenges that go along with running a growing business and have difficulty understanding how to manage their finances.
Nathan explained, “This summer BUBA ran a successful 10-week pilot program where teams of students worked closely with two business owners in the underserved community of Dorchester. They targeted key issues like cash flow management in order to promote financial education, clarification, and organization and used the accounting software program QuickBooks as a tool to help the companies manage by the numbers.” Nathan was thrilled when MSNBC’s Your Business featured BUBA on their weekly show.
Teaching QuickBooks to the business owners allowed the BU undergraduate and graduate students to establish financial literacy through a “Rule of Thumb” approach. This is where 4 – 6 key metrics are used to educate these business owners on important financial goals so they can benchmark themselves against similar businesses and understand how to generate savings or greater cost effectiveness. For example, a restaurant can see what percentage they spend on food compared to the average expenditure of other restaurants throughout the country and then evaluate possible adjustments to improve net profit and operating efficiency.
The teams found success working with two businesses in Massachusetts, D’Benny’s, a pizza shop, and A’Dalliance, a women’s clothing store, both in Dorchester. Now they are expanding their work thanks to the backing of the university. Nathan explained, “SMG’s Dean Kenneth Freeman connected me to two alumni who were gracious enough to provide seed money for the project and then SMG and the Center for Finance Law and Policy also made generous funding donations. Professors Erik Molander, Peter Russo, Kristen McCormack, Beth Goldstein, David Stolow and Ian Mashiter have provided programmatic guidance. This initial monetary and advisory support has enabled the program to grow this fall to six businesses managed by six MBAs, and eighteen undergraduate students. Of these six businesses, four are located in Allston Village and two are in Dorchester. We hope to expand to fourteen businesses in the next six months.”
The business owners were not the only ones who benefited from this summer’s pilot program. The student-run teams made up of undergraduates and led by graduate students walked away with knowledge that can’t be learned in the classroom. This experiential learning experience balanced in-class professional development and training sessions with time spent in the businesses understanding the processes and realities that are faced on a day-to-day basis. The combination allows students to implement course knowledge immediately to best address the needs of the businesses they are working with.
Nathan’s long term visions it to “…see BUBA become a national program in universities across the United States where students can gain a deeper understanding of small businesses challenges and business owners can benefit from the support provided by the students. Since BUBA is a BU brand, we are committed to working hard to ensure quality control measures are in place and the students receive proper training so that we never lose the personal and individualized attention that every small business owner requires to be successful.”