RVANews

Q&A with Ed McLaughlin, VCU’s new athletic director

Richmond BizSense — Mon, 06 Aug 2012 16:20:56 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

The new Ram on campus isn’t shy about his aspirations for VCU.

Virginia Commonwealth University recently introduced Ed McLaughlin as its new athletic director.

McLaughlin spent six years at Niagara University and has worked at Merrimack College and American University. He started at American on the same day the school left the Colonial Athletic Conference in 2000.

Twelve years later, McLaughlin is taking the reins at VCU with the Rams fresh off two high profile NCAA tournament performances and a transition from the CAA to the Atlantic 10 Conference.

BizSense caught up with McLaughlin last month to talk about the future of VCU athletics and why he has his eye on a national championship.

Below is an edited transcript.

QAfter six years at Niagara, what drew you to VCU?

AI knew VCU, and I knew some of the culture at VCU. I knew Shaka Smart a bit as well. His energy, his enthusiasm, his ability to see that there are even more things we can accomplish — those all drew me here. And, quite frankly, the move to the Atlantic 10 piqued my interest as well. The chance to take a group that has done some really incredible things and make it really special, to me, was very exciting. The move to the A-10 really helps that along.

QWhat will the move to the Atlantic 10 do for VCU, both on and off the court?

AIt will give VCU larger national exposure, be it on television [or] whatever forms of communication people consume. It puts us on a larger platform. It gives us a much larger scope of where we’ll reach. We’ll play games in places like St. Louis, Ohio, New York City and places we haven’t been before.

The other side of it is, if you look at conference RPI [rating percentage index], it’s certainly a highly rated RPI conference. And that ability for us to not only win championships but to get at-large bids for our teams is something that is attractive. You have to be in the NCAA tournament to win it.

QWith a recent $4 million Siegel Center upgrade, a new contract for head coach Shaka Smart and a $10 million practice facility on the drawing board, VCU is investing heavily in the men’s basketball program. What are your goals for Rams basketball, and how will you get there?

AThe key to success in any area is being able to have the resources to support it. Our ability to build a practice facility will be important to give our student athletes a wonderful experience, because that’s what keeps you in the loop to get good recruits going forward.

The recruiting class Shaka Smart has coming in is fantastic. And I know that will continue because of the continued support, because the Siegel Center is jammed at home games and so hard a place to play. Those things are really critical for us moving forward. But I do think we can be an elite-level program. I firmly believe that. I think we can have some fun chasing a national championship.

QVCU men’s basketball had a couple of NCAA runs recently. What is the key to making VCU a perennially high-achieving team, and not a George Mason-esque, one-and-done Cinderella?

AI think keeping Shaka is a big part of it. Believe me when I say he is one of the people that made me most excited about this place, because he’s so excited about VCU. But your ability to recruit student athletes is solely based on your student athlete experience. We have to make sure for our basketball programs that we provide as great of an experience as any student athlete gets in America.

That’s all those different pieces. It’s supporting them in academics and life skills, it’s giving them great places to practice so they can get better, it’s making sure they have good accommodations on the road so they’re prepared and ready to go play games and it’s also making sure that the Siegel Center is a really hard place to play. Home court advantage is big. It really is.

QVCU has made great strides in fundraising over the past few years. How will you work to maintain that momentum and produce the resources you’ll need to support the athletic department?

AWhen you’re an AD, the biggest thing these days is being able to raise money. And as large of a city as Richmond seems, it also seems very much like a tight-knit small community. So being able to reach out to folks and do a lot of one-on-one meetings — all the moments that you can reach out to folks and talk about VCU in small groups are really critical. You can talk to the masses all you want, but the real fundraising gets done person to person or in a small setting that can be intimate and you can really build a relationship. My ability to build relationships is going to be critical.

We’re also going to drive up some annual fund money. They’ve done an amazing job of doing that already, but we’re certainly looking to drive up the annual fund money to make sure we can pay to do the things we need to do everyday.

QMoving away from men’s basketball, what else is there to be excited about at in Rams athletics?

AThere’s a bunch of things. I look at our women’s basketball program, and newly hired head coach Marlene Stollings is going to be great. You look at what she did at Winthrop in one year, turned that program around, and you get excited about it. And she’s a good person. She’s going to do the right things, and her student athletes are going to carry themselves the right way.

As I look across our other sports, I think there’s a huge upside. I look at our soccer programs: We have talented coaches there and some demonstrated success. I look at our baseball program. Certainly what our men’s and women’s tennis programs have been able to do is incredible. And [tennis] Coach [Paul] Kostin, he does it right. There’s no question about that with the success he’s been able to create.

And I look at all of our Olympic sports and say, “We have to put them in the same position that we’ll put men’s and women’s basketball in” in terms the ability to really create sustainable success on the field, but also academically and in the community.

Burl Rolett covers small business for BizSense. He can be reached at Burl@richmondbizsense.com

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Local beer market gets spiced up

Richmond BizSense — Thu, 10 May 2012 14:56:32 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

A Boulder, Colo., craft brewery known for one of the spiciest beers on the planet has landed in Richmond.

Beers from Twisted Pine Brewing Company have been picked up by locally based Brown Distributing and are available at some restaurants and retailers across town.

Richmond is the only Virginia market selling Twisted Pine, said Jacob Brunow, craft and import manager at Brown. It’s all part of Brown’s push to put Richmond on the craft beer map.

“We’re adding beers that are only available in Richmond to start off with – exclusive only to Richmond. We want Richmond to be beer-centric,” Brunow said.

One of the biggest beer distributors in Richmond (the company distributes Anheuser Busch), Brown has picked up 20 to 30 craft beer brands over the past year or so.

Brunow said Brown got its first sip of Twisted Pine Beers two years ago at the American Beer Festival.

Brown then signed the brewery up for distribution in its Florida markets. But it took a little longer to work its way up to Richmond.

“[Twisted Pine] is not the biggest brewery in the world, so they are looking to come into markets that are a bit smaller,” Brunow said. “It works nicely in our Richmond market, which has eclectic taste but is kind of a smaller market.”

Founded in 1995, Twisted Pine produces dozens of smaller batch beers.

A handful are available in Richmond, including Hoppy Boy (IPA), Hoppy Knight India Black Ale, Big Shot Espresso Stout, Billy’s Chilies and La Petite Saison.

The beers are being sold at local beer and wine shops like Once Upon a Vine, Total Wine, Corks & Kegs, River City Cellars and Elwood Thompson’s. They are also on tap at Capital Ale House.

One of the beers that isn’t here yet is Twisted Pine’s Ghost Face Killah, a beer made with the Bhut Jolokia pepper, also known as the ghost pepper.

“It’ll make you sweat a little bit,” Brunow said.

by BizSense reporter Michael Schwartz

Q&A: how Sports Backers hit its stride

Richmond BizSense — Tue, 27 Mar 2012 10:00:21 +0000

About 40,000 people will take over one of Richmond’s most famous streets Saturday.In its 13th year, the Monument Avenue 10K is bigger than ever. And after 20 years in the business of putting on races and sporting events across Richmond, Sports Backers appears to have hit its stride. The local nonprofit, which puts on about a dozen events, eclipsed the $5 million mark for annual revenue last year for the first time in its history. The organization has 20 employees, manages more than 6,000 volunteers every year and has no plans to slow down.

To gear up for the March 31 Ukrop’s Monument Avenue 10K, BizSense caught up with Sports Backers Executive Director Jon Lugbill to talk about the race, the nonprofit’s growth and why his organization might well be the Wawa of race organizers.The following is an edited transcript.

QHow big has the Monument Avenue 10K become?

ALast year we had over 41,000 participants. That made it the 19th largest running race in the world in 2011. We’re going to be right near that number again this year. It’s been constantly growing, and a lot of that has to do with it being run on a beautiful street, and the community has really adopted it.

QYour revenue has grown to $5 million annually. What kind of growth are you seeing year to year?

AWe’ve been growing between $400,000 and $600,000 per year since 2006. In 2005 to 2006, our gross revenue was $2.5 million. During that period, we had set a goal of doubling our impact on the community. In doing that, we doubled our revenue.

QHow much of the revenue comes from the Monument 10K?

AAbout 87 percent of our revenue is from events. The Anthem Richmond Marathon and the Monument Avenue 10K are more than half of that total. They are very significant, and both of them required a significant investment up front. The marathon had seven years that lost money. [The other 13 percent of revenue comes from local government and philanthropy.]

QHow do you continue to persuade so many people to pay to run and pay to put their bodies through pain and physical exertion?

AWe always say, “Why would someone pay us to run down Monument Avenue when they can do it any day of the week for free?” First, we’re creating an experience with all the bands and spirit groups and people that come out. Second, physical activity is incredibly good for your health. Taking part in our events leads to a more active lifestyle and more healthy families, friends, neighbors, etc. There’s no downside.

QHow competitive an industry is it with all these mud runs popping up and runs in Virginia Beach, Charlottesville and D.C.?

AIt’s getting more competitive. More and more races are being put on. Communities see it as tourism development, and they want to put money behind it. If people trust your brand, you can still shine amongst a lot of competition. There are lots of convenience stores, but you know what you are going to get when you go to Wawa.

QWhat kind of pressure do you feel to continue to come up with new ideas for events, especially ideas that are different from what’s already out there?

AWe want to create more events. We think there’s opportunity in cycling and within walking. We’re going to work more with schools. We plan on one or two new events a year for the next five years.

QAre there ever events that just aren’t successful?

AIf our new events haven’t shown potential to be significant events after three to five years, we cut them. We had a 3-on-3 basketball tournament that we really liked and thought had a lot of potential. We never could get it bigger than 700 or 800 people, so we stopped doing it this year. We’re willing to make tough decisions.

QLuring corporate sponsorships also helps pay your bills. Are those a tough sell these days?

AOur sponsorship levels have done very well throughout the recession. Some of our individual giving and government funding has declined. But our total sponsorship dollars went up, because we added more product, and that product is selling.

QIs there a point you might hit at which the Richmond market will be saturated with these types of events?

AWe don’t want to do an event on the weekend of NASCAR or on top of the Strikers soccer tournaments. We also don’t want to be competing for hotel rooms to the point where there aren’t hotel rooms for people. We do have some limitations. There are some times of the year where you go, “That would be great, but we just can’t.”

QIt seems like the organization has these events down to a science. Do you dream about taking Sports Backers to another region to replicate the formula?

ARichmond is the only place we want to be. We’ve had some of those discussions. In theory, our ability to organize events could be taken to other cities. We decided not to do that because we thought we’d lose focus. Often our events don’t make money for five to seven years. It takes years to get them to the point where they pay for themselves, let alone spin off money.

Times-Dispatch parent considers sale as loan clock ticks

Richmond BizSense — Thu, 23 Feb 2012 15:04:19 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

Richmond-based Media General, the parent company of the Richmond Times-Dispatch, said Wednesday that it is considering selling some of its newspapers.

The company said in a news release that it had been contacted by potential buyers but did not say which properties were up for sale.

Media General spokesman Ray Kozakewicz said he would not comment on which papers had been the subject of inquiries, nor would he comment on any “specific newspapers, markets or size of newspapers” up for sale.

Media General has been looking for ways to cut expenses and raise cash for more than five years, during which its stock has dropped to $5 from $40.

The company forced employees to take 15 unpaid days off in the second half of last year, a move it said would save $9 million. That came on top of 15 unpaid days in 2009. It also laid off 165 workers last year at its Florida operations in Tampa.

The company, which has been in Richmond for more than 100 years, lost $74.3 million in 2011. That came on the heels of losses of $22.6 million in 2010 and $35.7 million in 2009.

In 2011, almost half of the $616 million in revenue came from print media, with the rest coming from the broadcast and digital wings.

Media General CEO Marshall Morton said in a company-wide email obtained by the insider news blog Romenesko that the decision to shop his newspapers around for buyers was prompted in part by a number of newspaper sales in 2011 that led the company to believe it could get good money on a sale.

“In the latter part of 2011, a number of transactions were completed for local media properties, including newspapers, at valuation levels that have not occurred in a number of years, certainly not since the economic downturn began,” wrote Morton. “This is a positive development for the industry.”

The company has been working to renegotiate a $363 million loan that is due in March 2013. The loan carries with it provisions that force the company to maintain certain levels of debt, revenue and expenses. Selling newspaper assets could bolster the company with cash and help satisfy lenders during the refinancing process.

Media General is not the only Virginia-based media company to look to sell assets. In 2008, Norfolk-based Landmark Communications said it was putting itself up for sale. So far, it has only sold the Weather Chanel — it still runs the Roanoke Times, the Virginian-Pilot and, in Richmond, Style Weekly.

Media General said it hired investment banking firm J. Solomon Company to evaluate the possible sale but said there was no guarantee that any of the properties would be sold.

Media General has sold print publications before. In 2009, it sold the Richmond-based Virginia Business Magazine to a private investor group, also out of Richmond.

BizSense reporter Michael Schwartz contributed to this story.

RelayFoods lands $3 million in fresh capital

Richmond BizSense — Thu, 02 Feb 2012 11:00:38 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

A startup grocery delivery service has scored a new round of investment funding.

RelayFoods.com, which has operations in Richmond and Charlottesville, said Tuesday that it closed a $3 million funding round from Battery Ventures and a group of other undisclosed investors. RelayFoods has raised $5.5 million since its founding in 2007. Customers order groceries from local merchants online and pick them up at specified delivery spots. The company will deliver to customers’ homes for an extra fee.

RelayFoods started in Charlottesville two years ago and expanded to Richmond in August 2010. The company said it would use the capital to expand its product offerings and fine-tune its operations. President and COO Arnie Katz wouldn’t get too specific about the company’s plans for the money. “We raised the money because of how well we’ve grown over the past year and half since we started serving Richmond,” Katz said.

RelayFoods has 35 pickup locations in Richmond, in addition to 25 in Charlottesville. It has about 20 employees in Richmond and a 9,000-square-foot warehouse in Scott’s Addition. Its vision expands beyond Central Virginia, though.

“Relay is a business that has regional and national aspirations,” Katz said. “A huge opportunity exists in the online grocery space in that there is not yet a clear leader that is emerging.” Katz said there is no set timetable, and he wouldn’t mention any specific markets the company is targeting. “We’re getting closer every month,” he said. This latest round of capital should last Relay a while, Katz said.

“That said, when we start expanding aggressively, it probably would make sense to put additional capital into play.”

Developer plans to raise the roof next to nightclub

Richmond BizSense — Thu, 26 Jan 2012 17:48:09 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

A parking lot next to Shockoe Bottom’s most notorious nightclub is getting a $22 million makeover.

Longtime local developer Louis Salomonsky is planning a 124-unit apartment development on a lot adjacent to Have a Nice Day Cafe.

Salomonsky told BizSense on Wednesday that the project, called Canal Lofts IV, would be slightly more up-market than his other three Canal Loft buildings, and that he is aiming for a more affluent tenant.

“We plan to raise the bar a bit in Shockoe Bottom,” Salomonsky said.

The development will feature one three-bedroom, 39 two-bedroom and 84 one-bedroom apartments and a three-story parking deck with about 320 parking spaces, according to permits filed with City Hall. Between the parking deck and the apartments, it will be an almost 200,000-square-foot structure.

Salomonsky gave a ballpark estimate of almost $22 million for the apartments. Historic Housing, which Salomonsky co-owns with David White, is close to a deal with a lender for the project, but Salomonsky wouldn’t comment on which bank would finance the project until it’s settled.

Salomonsky’s companies, SWA Construction and SWA Architects, will work the project. Bacon Housing is the property owner, and Main Street Realty will manage the property. All those companies are subsidiaries of Historic Housing.

Once the new project is complete, Historic Housing will operate almost 900 apartments in Shockoe Slip and Shockoe Bottom, Salomonsky said.

Salomonsky said that the proximity to Have a Nice Day Cafe, which has been the source of some ill will among owners in the Bottom, wouldn’t drive away tenants. But he said the owners of the nightclub should keep their operation from causing problems in the neighborhood.

“They are going to need to run a good operation there if they want to stay in business,” Salomonsky said.

Ukrop’s allure eludes Martin’s

Richmond BizSense — Fri, 20 Jan 2012 15:33:57 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

For decades, the formula for developing successful new retail centers in Richmond was as clear as day: Land a Ukrop’s supermarket as the anchor tenant and fill in around it.

Given the chain’s no-alcohol policy, you usually got a wine store, and you could count on tossing in a pharmacy and maybe a few restaurants.

But that formula got more complicated in recent years, first when sales started to slow at Ukrop’s and then in 2009, when the Richmond-based grocer was sold to the parent company of Martin’s.

“Everybody wanted to be in a Ukrop’s shopping center, because Ukrop’s was the institution in Richmond,” said Peter Bunin, a broker with S.L. Nusbaum who helped develop some of the Ukrop’s shopping centers in Richmond and who leases space in four of the Martin’s centers.

Bunin said that for decades the 72-year-old brand made for an easy sell to prospective tenants but that the Ukrop’s centers eventually lost a bit of their allure. And then the economy slowed, making it harder to lease spaces everywhere.

A dozen brokers who talked with BizSense said that although Martin’s is still a big draw as an anchor tenant, outlying retail spaces in Martin’s centers are harder to lease to locally based businesses than when the stores carried the Ukrop’s banner.

That’s partly because there is simply more competition for grocery customers in Richmond, including Wal-Mart and Food Lion and more recent entrants such as Whole Foods and Trader Joe’s. And, of course, the economy is still hurting.

But brokers said Martin’s underestimated the loyalties of Richmonders and that their sales are lower than expected. And local retail tenants are more hesitant — perhaps just for emotional reasons, brokers say — to sign leases in centers anchored by Martin’s.

James Ashby, a broker with Cushman Wakefield | Thalhimer, said that overall there has not been a huge change in the kind of tenants attracted to Martin’s-anchored centers, but he noted that Richmonders have been slow to warm to the newcomer.

“Any time you make a big change, especially when they are taking over from a company like Ukrop’s, there will be some degree of that,” he said. “But overall there hasn’t been a big drop-off in foot traffic that I’ve seen in Martin’s centers.”

Connie Nielsen, also a Thalhimer broker, said that foot traffic in some Martin’s shopping centers dropped during the Ukrop’s days.

“Before Ukrop’s sold, they had seen a drop in quality and market share but had held onto their loyal fan base by being the hometown favorite,” Nielsen said. “Martin’s does not have that luxury.”

“The drop in patronage has [negatively] affected some merchants … that co-tenant with Martin’s,” she said. But “Martin’s is still a strong anchor, and as long as the property is well positioned and the center has other strong co-tenancy, they are still a desirable anchor.”

Luke Puccinelli, who works for Regency Centers and leases space near the Martin’s at the Village and at Gayton Crossing, said that local retailers are still wary of Martin’s shopping centers but that national retailers and restaurateurs see the grocer as a good anchor because its parent company is financially strong.

“They are too big a company and too experienced a company [to fail.] From the sales I’ve seen and the conversations I’ve had with their team last year and into this year, they’re moving in the right direction,” Puccinelli said.

As for Richmonders’ early reluctance to embrace the grocer, both as an anchor and a part of the community, it was a matter of how deeply entrenched Ukrop’s was in the Richmond culture.

“I think any other store would’ve had just a much trouble, whether it was Harris Teeter or Kroger or Food Lion,” Puccinelli said. “And a lot of other operators, I’m not sure they would have done as well as Ahold,” the parent company to Martin’s.

For Puccinelli, there is at least one big change that weighs in Martin’s favor: Unlike Ukrop’s, they are open on Sundays.

“In local name recognition, Ukrop’s was the better anchor tenant, but on Sunday there was almost no traffic,” he said. “Now retailers are saying, ‘Hey, Sunday is a full day of business.’ They are seeing traffic they never saw before.”

Three lawsuits, two wheels, one sharp turn

Richmond BizSense — Fri, 21 Oct 2011 13:42:41 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

A trio of lawsuits has all but killed a local Segway dealership and forced its owner to roll quickly into a surprising new business model.

Segway of Richmond, the Shockoe Slip dealer that sells the gyroscopic two-wheeled vehicles, is going to shut down. Meanwhile, owner Buck Ward is launching Experience Richmond, a new company that will bring trolley cars back to the city.

The Segway store has been hit with three lawsuits this year by customers who claim they were injured while riding Segways on tours offered by the dealership.

The business’s liability insurance kicked in to deal with the suits, but that’s where the story took an unexpected turn, according to Ward, who opened the dealership three and a half years ago.

“We got hit by a freight train,” he said.

Ward’s insurance company dropped the company’s liability policy, a must-have to be a Segway dealer. And because the three suits are dragging on, Ward couldn’t find another insurer to cover his business.

“I didn’t see that coming at all,” Ward said. “It’s basically put us out of the Segway business altogether.”

Ward didn’t stand flat-footed for long.

He leased his storefront to a Williamsburg-based Segway tour company that has insurance. Then last week he went to the West Coast and spent $400,000 on five old-fashioned trolley cars.

“We have to change, and we have to survive,” Ward said. “Our business was killed.”

The trolley cars will be the linchpin of Experience Richmond, a company Ward says will eventually offer tours of the city via trolley, scooter and bike. He will also organize whitewater rafting and kayaking on the river.

Ward’s new venture will try to play off the history of the trolley car in Richmond.

The city was apparently home to the first successful electric trolley system in the country, way back in 1887, Ward said. The five trolleys he purchased are on their way to the East Coast, where they’ll be converted into electric hybrids.

“So we can in fact say the electric trolley has returned to Richmond,” Ward said.

Having to step away from the Segway business wasn’t an easy decision: “It was a fabulous cash cow,” Ward said.

In just a little more than three years, Ward’s dealership served 14,000 customers. That includes thousands of Segway tours, which made up the bulk of the company revenue. He said he sold about 100 Segways last year and has sold about 75 this year.

Ward has been in contact with prospective buyers who would take over the dealership rights and then lease the space from Ward and share it with Experience Richmond.

As for being put out of business at the hands of three personal injury cases, Ward said there is no bad blood.

“I don’t have any ill feelings toward them at all. I really don’t. You don’t ever want to see people get hurt,” said Ward. “But it’s unfortunate because the business that we started on the back of a napkin is no longer.”

Jim Thorsen, an attorney with Marchant, Thorsen, Honey, Baldwin and Meyer who is representing two of the plaintiffs that sued Ward’s business, said the cases are pending and will likely go to trial next year.

When asked about Segway of Richmond shutting down as a result of the suits, Thorsen said it was the first he had heard of it and that he doesn’t set out to put anyone out of business.

“All I know is that I have two clients that have that have serious injuries,” he said.

The suits, all of which were filed in Richmond Circuit Court, describe alleged instances of the Segways lunging or lurching despite riders’ attempts to control them. The incidents, which occurred in 2009, resulted in alleged injuries and related hardships to the tune of a combined $6 million.

Thorsen and his clients are battling the lawyers hired by the insurance companies that covered Ward and Segway Inc., the New Hampshire-based manufacturer of the vehicles that was also sued in each suit.

Michael Schwartz is a BizSense reporter. Please send news tips to Michael@richmondbizsense.com.

Restaurant, meet your new roommate: trendy computer lounge.

Richmond BizSense — Fri, 14 Oct 2011 14:49:54 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

Adam Bell and Harold Lewis are getting ready to open S@mple--yes, with an @ symbol--a new restaurant that combines food and gadgets in the old Sprout location on North Morris Street near VCU.

“We will have laptops and iPads for people to rent by the hour,” said Bell, 27. “It’s where food meets technology.”

S@mple will serve lunch and dinner with a menu of small plates including fish tacos, scallops, duck, lamb skewers and grilled strawberry shortcake.

It will also be a place for patrons to catch up on their work, browse the web or check email for just a few bucks.

The 2,500-square-foot space will seat 70 patrons, have a full-size bar as well as a wine bar and two dining areas, one of which will double as a conference room for local business professionals to hold meetings or luncheons.

Bell, who owns neighboring computer repair shop @lbtech, said the back room would also serve as a software-training center where business people get a crash course in Microsoft Excel and other computer programs while grabbing a bite.

“We’ll have @lbtech instructors in here teaching the classes,” he said.

The former tenant, Sprout, closed Sept. 5 after a yearlong run.

To design S@mple, the pair hired Helen Reed of HL Reed Design, who has done work for the recent Portico restaurant on River Road as well as the Blue Goat.

Bell has operated @lbtech since November 2007. It will be his first crack at running a restaurant, but he’s no stranger to the scene.

“I’ve been doing the marketing and web design for restaurant clients the last two years,” he said.

Lewis on the other hand, has worked the local restaurant industry since 1991. For the past 10 years, he was a part of the Richmond Restaurant Group, and before that he ran Shockoe Bottom bar Area 51 until he closed it in 2000.

The two met about five years ago when Lewis was working on a project for the RRG. Their paths crossed again about a month ago on a project they were both working on, and from there decided to partner up.

“It was time for me to move on,” Lewis said. “We’re good at what we do and love what we do.”

Bell will continue to operate @lbtech part time when S@mple opens, and Lewis will run it full time. They’ve also brought on Blair Lester, a former employee of Lewis’s at deLux in the Fan, to help run the new spot.

Lewis and Bell plan to open by mid-November and hope S@mple will stand out among the many surrounding Fan bars and restaurants.

“We know there’s competition, and what is going to set us apart is the food and the service,” Bell said.

Amy David is a BizSense reporter. Please send news tips to Amy@richmondbizsense.com.

— ∮∮∮ —

Follow the community conversation about this story over on Fan of the Fan.

Richmond’s own cold war

Richmond BizSense — Thu, 22 Sep 2011 21:11:38 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

Let the fro-yo battle begin.

Pennsylvania-based Yapple Yogurt, a nascent self-serve frozen yogurt business, will open its first Virginia location in Carytown in early December — right next door to booming yogurt chain Sweet Frog. (You can get caught up on Sweet Frog’s rapid rise in a BizSense story here.)

Andy Lin started Yapple in May, opening a location in Wynnewood, Pa. Lin has since opened three other shops in New Jersey and Pennsylvania and is on a fast track for expansion. “We saw a great opportunity down here,” said Lin, 24. “It’s a great market.” Lin recently graduated from Rutgers University and was running the businesses while he attended school. His father is financing the shops and is a silent partner in the venture. Lin and his cousin Scott Yu will run the Carytown shop.

After browsing the local retail scene with Richmond commercial brokerage The Shockoe Company for the past four months, the entrepreneurs this month leased a 5,500-square-foot space in the former Richmond Piano spot at 3133 W. Cary St., which has been vacant the past two years. “Carytown was always my first choice,” said Yu, 24.

Lin said they were looking to expand because of the success of the other locations. He wouldn’t disclose revenue numbers. “The revenue stream has been very good, and it’s a low-risk investment,” Lin said. “It’s a great model, and I think the way we’re doing it is a little different.”

Yapple serves 16 yogurt flavors, including cheesecake, peanut butter and blood orange, along with 50 toppings. Neighboring yogurt chain Sweet Frog is just two doors down, and Lin said the move to the space nearby was intentional.

“We want to compete with the largest player in town,” he said. “If you want to be successful, you go after the biggest player.” Lin said competition is rampant among the other Yapple stores as well. “Most of our other stores have competitors right next door, and our business hasn’t been affected,” Lin said.

Lin has worked with in his father’s restaurant in Pennsylvania since he was 16. His father owns Kawa Trading, a Pennsylvania-based food distribution company. Yu has lived in Richmond for the past 10 years working as a manager for his mother’s Asian buffet in Midlothian. His mother has been in Richmond’s restaurant scene for 15 years. The pair say they know the fro-yo business is getting frothy. The entrepreneurs said they are introducing a drink line, which they think will separate them from the pack.

“We’ll have smoothies, bubble tea and tea imported from Japan,” Lin said. Lin noted that many yogurt chains have their yogurt packaged and sent frozen to them. He said they would be making the yogurt fresh daily along with sourcing their fruit, milk and other ingredients locally, which he hopes will also make them stand out among their competitors. “Its cleaner, healthier and lighter,” Lin said.

Lin said this will be their biggest Yapple store yet. Most of the other shops are about 1,200 square feet. And because they’re a gutting the entire space, it will also be the most costly. Lin said he has opened most of the Yapples for $300,000, but this shop will cost about $500,000 to get up and running.

They plan to add a spiral staircase and put in surrounding windows and use local artists to design the shop. They aren’t looking to franchise Yapple yet, but Lin said it could be a possibility. “We don’t want the brand to be ruined by a franchisee,” he said. “It’s too new.”

Crocker’s corner

Richmond BizSense — Tue, 06 Sep 2011 13:22:47 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

An ambitious restaurateur is trying to corner the market on one particular block in the Fan.

Jake Crocker and his FWS Group partners plan to convert a dilapidated novelty shop at 2400 W. Main St. into a late-night sandwich and drink spot called Uptown Market and Deli. A business called the Happy Corner formerly had the space.

That will give Crocker control of three out of four corner businesses at the intersection of Stafford Avenue and West Main Street. The FWS Group consists of local lawyer Hayden Fisher, chef Sean Murphy and Evan Dority. The partners own F.W. Sullivan’s Bar and Grille and Lady N’awlins Cajun Cafe. They also announced they were going to add an FW Sullivan’s in Fredericksburg, but it has not opened yet.

The deli will be open 24 hours and sell coffee, sandwiches, wine, beer and soda.

“There’s a market and demand for a grab-and-go sandwich place,” Crocker said.

There won’t be any indoor seating. Instead, Crocker plans to have a walk-up window for late-night sidewalk patrons to buy a sandwich or a soda.

“We’ll have a nice local and craft beer selection,” he said. “We’ll source local and Virginia wines as much as we can.”

With the growing popularity of farmers markets in the area, Crocker said he plans to sell local produce in the store.

The FWS Group also plans to have a food cart sitting outside along Stafford Avenue with fruit, sandwiches and other items.

Crocker said a partner in FWS Group came up with the idea for a deli.

“One of my partners, Evan [Dority], has a background as a manager of a Littlejohn’s in Charlottesville,” he said. “He always wanted to do something like that.”

The partners have been eyeing the former Happy Corner shop since this spring. But a dispute between shop owner Chris Dorsey and his landlord were holding up the process.

Crocker said he finalized the lease about a month ago.

As for his other establishments on that corner, F.W. Sullivan’s and Lady N’awlins, Crocker said business has been good and he’s been spreading the word to his customers about the upcoming market.

The partners have already begun renovating the inside, and Crocker expects it to cost about $20,000 to fix up.

Crocker said he hopes to have it open by mid-October.

Amy David is a BizSense reporter. Please send news tips to Amy@richmondbizsense.com.

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New watering hole on tap for Midlothian

Richmond BizSense — Fri, 08 Jul 2011 13:48:47 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

A local businessman has ventured out of the corporate restaurant world to launch his own taphouse concept in Midlothian.

In October, Dennis Barbaro plans to open the Sedona Taphouse, a craft beer house in Westchester Commons shopping center that will feature 550 craft beers, 60 of which will be on tap.

Barbaro, a managing partner of the Bonefish Grill in Williamsburg, went on the hunt in Richmond about a year ago for a location for his new business.

“I saw a definite niche, and I’m very into craft beer myself,” Barbaro said.

After searching Innsbrook and Short Pump, Barbaro decided in April to lease a 2,800-square-foot space in Westchester Commons.

Barbaro said that he has a couple of investors who are helping fund the concept and that he expects it to cost about $600,000 to get up and running.

He expects the construction to take about three months, and he’s shooting for a mid-October opening.

And if Barbaro’s plan goes as he’s drawn it up, Sedona’s beer might be flowing in other locations, too.

He said the Midlothian location will be the flagship store for the Sedona concept, but he plans to expand in Richmond and other areas in the future.

“Within the next three years, I want to open two more in Richmond and then Charlottesville, New York, New Jersey and Florida eventually,” he said.

Although beer is the focus, Sedona will also have a selection of Virginia and international wines.

There will also be some food to soak up all that alcohol. Barbaro said he’s still working on the menu, but he said it would include seafood, pizza, salads and other appetizer-like dishes ranging from $9 to $16.

Barbaro is no stranger to restaurants. The New York native’s 30-year career has included stints as a managing partner for OSI Restaurant Partners, the parent company of Bonefish Grill, Outback Steak House and Carrabba’s Italian Grill.

About five years ago, he moved to Richmond with his wife, who is from the area.

Sedona Taphouse is expected to seat 101 people inside and 32 outside and feature a wraparound patio and a fire pit, Barbaro said.

Despite not having done any advertising, Barbaro said a big sign on the building at Westchester Commons has brought a good amount of traffic to the restaurant’s website.

“There are so many positive signs that it is very much in demand,” he said.

Amy David is a BizSense reporter. Please send news tips to amy@richmondbizsense.com

VCU students living north of the Interstate?

Richmond BizSense — Tue, 28 Jun 2011 14:03:49 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

An Indiana-based student housing developer is staking its claim in the Richmond market with a $22.4 million apartment complex.

Trinitas Ventures has begun work on an 11-acre plot on Chamberlayne Avenue just across Interstate 95 from Jackson Ward.

Travis Vencel, head of planning and acquisitions for the firm, said Trinitas had been working on the deal for a year.

“We’ve been looking for some time in Richmond for the right place,” Vencel said.

The project, called the Collegiate, consists of six multifamily buildings with a total of 270 one-, two-, three- and four-bedroom units. The complex will have a clubhouse and a swimming pool. The units will be fully furnished, Vencel said. A shuttle will offer transportation for residents to Virginia Commonwealth University, which is about half a mile away.

Indiana-based construction firm Vizor-Alderson is the general contractor.

Vencel said the project is funded by a combination of traditional bank financing and the firm’s equity partners.

Vencel said his company is opening a leasing office on Broad Street in the next few weeks, during which time they will also finalize the rental rates. The project is slated to be completed in August 2012.

Trinitas isn’t the first group to take a crack at developing the land.

“It had been under contract by another group. They fell away, and we swooped in and redesigned and redefined the project,” Vencel said.

That other group was working with Justin French, who is now serving 16 years in prison for tax credit fraud. French had acquired the property, which was previously a trailer park, and also had planned student housing there.

Trinitas bought the land from an LLC controlled by French for $2.6 million this year, with proceeds being surrendered to the U.S. Attorney for restitution purposes.

Al Harris covers commercial real estate for BizSense. Please send news tips to Al@richmondbizsense.com.

Fat Tire rolls into town

Richmond BizSense — Thu, 16 Jun 2011 21:37:12 +0000

Local beer lovers will have another craft brew to choose from starting in August.

Last week, Henrico distributor Specialty Beverage signed a deal to bring Fat Tire and the family of beers from Colorado-based New Belgium Brewing to Richmond.

Specialty Beverage distributes other craft beers locally, including Dogfish Head Ale and the Vermont beer Long Trail.

“The craft beer segment is probably the fastest-growing category in the entire alcohol beverage industry,” said Michael Brazel, vice president of sales and marketing for Specialty’s parent company, L. Knife & Son.

Brazel said he hopes to have New Belgium beer in convenience stores and super markets in late August. The first of the company’s beers to arrive in Richmond will be Fat Tire – and only in 22oz bottles
starting out.

Like other craft breweries, New Belgium is growing fast. It has plans to expand its Fort Collins, Colo. facility. The company also said it is looking at an East Coast brewery and will likely decide on a location by the end of 2011.

Aaron Kremer is the BizSense editor. Please send news tips to Editor@richmondbizsense.com.

An ace in the hole

Richmond BizSense — Tue, 07 Jun 2011 17:35:11 +0000

Some of the most interesting business ideas are born with the help of a few beers. For one local entrepreneur, that also included a few wooden boards and some corn bags.

Last year, James Rastberger invested $3,000 to start Richmond Cornhole to host organized leagues and tournaments and provide cornhole equipment to people who want take the game beyond their backyards.

Cornhole – often seen being played on Monument Avenue by shirtless competitors holding beer cans – is typically played outside and requires players to take turns throwing bags filled with feed corn into a raised wooden platform that has a hole at the end. Points are awarded for making it into the hole or close to it. The first player to reach 21 points wins.

Richmond Cornhole operates three weekly leagues and hosts one tournament a month at local bars and restaurants. Rastberger said business is starting to pick up now that summer is getting closer. The company made about $12,000 in 2010.

“I get a lot of regulars that have become friends that help me break down and set up,” he said.

Cornhole is not the only social sport business in Richmond. River City Sports and Social Club has been running kickball and dodgeball leagues for more than six years. That company does not have a cornhole league.

Rastberger, 33, caught the cornhole bug in Florida.

He’s from Richmond but moved to Tampa in 2004 for five years with his wife to work in advertising.

In 2009, he moved back to Richmond and took a job as a media consultant at Supermedia, a small advertising and marketing firm. Although advertising was his full-time gig, Rastberger still wanted to do something with cornhole.

“When I got back, I started researching and I couldn’t find anyone that was doing the leagues and tournaments,” he said.

That winter, Rastberger started tossing around the idea of launching his own cornhole operation.

And in February, he reached out to Hat Factory and got the nightclub to agree to host the first cornhole tournament.

“It brought them a good drinking crowd,” Rastberger said.

The three weekly leagues consist of about 12 teams per league. Each team has two players, and the season is six games. Local bars host the tournaments. Rastberger said they regularly play at Sharky’s in Innsbrook, BlackFinn and Fishbowl Bistro in Shockoe Bottom.

The place hosting a tournament gives about $400 worth of prizes that pay out to the top three teams.

“In return they’re getting eight to 16 teams in their establishment for at least two hours every week,” Rastberger said.

Most of the revenue comes from a portion of the entry fees: $40 per team and $20 for each tournament. Besides the tournaments and leagues, Rastberger also sells bags, boards, score towers and other equipment for the game.

Rastberger said that although it’s a competitive organized sport, his leagues are for everyone.

“People hear of the league and tournaments and think it’s only for the super competitive,” he said. “It’s all about having a good time.”

Depending on the success of the summer leagues, Rastberger said he’s also planning to organize some fall leagues and expand to Southside and Mechanicsville for tournaments.

“We’re open to holding more league nights at other places,” Rastberger said. “If the bars are happy, then we’ll continue to do it.”

By Amy David

Segway shop balances multiple lawsuits

Richmond BizSense — Wed, 18 May 2011 13:33:23 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

The next stop on a Segway tour of Richmond might be the city courthouse.

A Shockoe Slip Segway dealer has been sued three times since January – including twice in the past few weeks – by customers who claim that they were injured while riding the unorthodox vehicles on tours of Richmond.

Buck Ward, the owner of Segway of Richmond, said his company has liability insurance to help protect against claims and lawsuits, but that coverage doesn’t come cheap.

“It is both difficult to get and very expensive for a small business like ours,” he said in an email to BizSense.

And regardless of the outcome, fighting three suits at once is a major headache.

“It is very difficult and very expensive,” Ward said.

The suits, all of which were filed in Richmond Circuit Court, describe alleged instances of the Segways lunging or lurching despite the riders’ attempts to control them. The incidents, which all occurred in 2009, resulted in alleged injuries and related hardships to the tune of a combined $6 million.

Plaintiffs Jenny Honeycutt, Jeffury Whitt and Marge Pritchett each say that Segway of Richmond was negligent and reckless for allegedly not training the riders on how to handle the vehicles under certain conditions.

Each of the plaintiffs is also suing Segway Inc., the New Hampshire-based manufacturer of the vehicles.

The suits hinge on a common allegation that there are inherent, known glitches in the vehicles that can cause accidents.

“As Segway manufactured more and more product units, it amassed a database of accidents and incidents related specifically to software and battery malfunctions,” the suit filed by Jenny Honeycutt claims.

“Segway nonetheless continued to manufacture product units with little or no changes to either the vehicle software or battery specifications that would enhance a rider’s ability to control the Segway and would prevent abrupt and unexpected starts and stops.”

The suits contain similar language.

Honeycutt is represented by Thomas Stokes of Brenner, Evans and Millman

The other two plaintiffs are represented by James Thorsen of Marchant, Thorsen, Honey, Baldwin and Meyer.

Mike Ward, an attorney with Morris & Morris who is representing Segway Inc., would not comment on the suits.

Buck Ward said he couldn’t comment on the specific cases. But Ward, who responded only to emails, said safety is a priority.

“There is nothing more important to Segway of Richmond and its employees than our customers’ safety,” he said.

Since Ward opened Segway of Richmond in 2008, the company has given tours to more than 12,000 people without any injury or incident, he said.

“Over the past three years since opening, we have had solid, substantial growth year over year which we think reflects the care and attention our company and our guides place on our customers’ safety and in creating a fun and memorable experience,” Ward said.

Ward said customers who ride the gyroscopic vehicles sign waivers and releases of liability and are required to wear helmets. He also said riders are given the chance to ask questions about using the vehicles and about the risk of potential injury.

The suits, however, question the shop’s pre-ride regimen. Honeycutt’s suit claims the session did not include specific training for riding on “different texture surfaces, or going up or going down hills, ramps or inclines or for maneuvers in case of an emergency or malfunction.”

Segway Inc. and Segway of Richmond have denied the allegations in the Pritchett case, the oldest of three suits. They have not responded to the others.

Michael Schwartz is a BizSense reporter. Please send news tips to Michael@richmondbizsense.com.

Photo by: John Murden

From the ball field to the film biz

Richmond BizSense — Fri, 11 Mar 2011 17:00:02 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

From Michael Schwartz

Rich Prado hasn’t been in school for almost a decade, and he’s still on the academic calendar. And he’s not a teacher. Prado is the 32-year-old founder of Play In School, a local startup that makes recruiting videos for high school athletes. He played second base at Varina High and at William & Mary, a school he said he would not have been accepted to if not for his bat and glove skills.

While in college, he said, he realized that he wasn’t going to be a professional baseball prospect. So he quit the team and buckled down on his business degree. After a brief stint teaching sports marketing classes at Hermitage High, Prado became a professional business owner.

He recently sat down with BizSense to discuss his startup and how he handles parents who think their kid is the next Cal Ripken.

Richmond BizSense: Who are your clients? Are they potentially any high school athlete?

Rich Prado: I work with a whole number of types of kids; either their academics allow their game to continue or their athletics allow them to get a better education. I would never tell a parent I could guarantee anything. But if the kids have strong grades and are good athletes, there’s a spot out there

RBS: But you’re not likely to land one of the nation’s top recruits as a client, right?

RP: Michael Vick probably didn’t have to pay somebody to make highlight tapes for him.
[Top Division 1 prospects] — that’s like 1 to 2 percent of the country. The other 98 percent have to promote themselves.

RBS: How do you sell your concept? Is it tough to persuade parents to part with the money?

RP: It’s all about talking moms and dads through the process. The best way to describe it is as a video resume. I compare the recruiting process to a job search. That’s usually when it clicks for the parents. Video is never meant to get a kid signed. It’s meant to get coaches to come see you play. A resume isn’t to get you hired. It’s to get you an interview.

I’m not an impulse purchase. I cost about half the cost of books for one semester in college. My kids average about $70,000 [in scholarship money] over four years. This is an investment, and I try to position it that way for moms and dads. The return on investment has been incredible.

RBS: It seems like startup costs wouldn’t be too high for a service like this. What did you need starting out?

RP: Some software, some cameras and the gift of gab for talking to as many people as possible.

RBS: Was it tough starting out?

RP: I had to give away the first year before people saw the value.

RBS: When did it turn the corner?

RP: My class of 2009 was really small. Class of 2010 grew to about 30 kids. My 2010 class combined for over $2 million in scholarship money.

RBS: Once you realized people were willing to pay for your services, how did you set the prices?

RP: The normal fee for an individual is $595. That includes filming, editing, a personalized website, personalized DVDs and back-end support — talking strategy, communication and developing relationships with coaches. I spend more of my day doing that than film.

RBS: What about competition?

RP: There’s a little bit. First, parents can do this themselves. But most parents don’t have the skills, the technology or the time. There are some bigger national companies that offer this, but it’s not as personalized. It’s more of an assembly line.

RBS: What’s your greatest success story for one of your athlete clients?

RP: My greatest success story is a kid from Charlottesville. His backup school was Cornell. He committed to a school that costs $52,000 a year. With his academics, they put a package together for that kid worth $43,000 a year. His dad thought I was expensive when he first met me.

RBS: Part of your service is a webpage for the athletes. Has sending a coach a link to a website replaced the traditional recruiting video?

RP: A webpage is probably the most common way. Kids still get DVDs. But the DVDs are disappearing. The Web is key, and coaches are used to this.

RBS: How do you handle those parents who think their kid is the next superstar?

RP: You hear, “If my kid is good enough, he’ll get found.” Everybody thinks his kid is Cal Ripken. It’s not my place to tell them they’re not.

RBS: How big do you think your business could get? Do you have a figure in mind to where you can still handle it on your own and make it a career?

RP: I’ve got a figure in my head. I’ll keep it in my head. But I’ve seen bigger doesn’t always equal better. I’ve been approached by some people to franchise this. That could be a viable option down the road.

RBS: Where did the name “Play In School” come from?

RP: Because every kid wants to play in school.

RBS: How are your prospects looking for 2011?

RP: I want to offer team packages, which will hopefully get my name out there to a lot of kids. This graduation year [June 2011], I’m going to have about 50 kids [clients] that go on to play college sports. Looking at class 2012, business is definitely ahead on the individual packages with the hope that team packages will jump me up a bit.

I also want to increase my football business. I’ve been cutting my teeth with baseball. I’m ready to expand.

Michael Schwartz is a BizSense reporter. Please send news tips to Michael@richmondbizsense.com.

A tiara, a sash and lawsuits against local restaurant

Richmond BizSense — Wed, 09 Mar 2011 15:54:48 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

A new plaintiff is suing local businesses over wheelchair accessibility issues, but this one wears a crown.

Nicole Swann, who is the 2010 winner of the Ms. Wheelchair Virginia pageant, is the latest plaintiff to go after Richmond area businesses for not complying with access rules.

In February, Swann filed suit against Mom’s Siam and Bonvenu restaurants in Carytown, Sticky Rice on W. Main Street and Southside Plaza shopping center. Among the complaints: a lack of accessible parking spaces, bathrooms, ramps and seating areas.

The passage of the American Disabilities Act in 1990 set standards that places of public accommodation had to follow in order to provide equal access to patrons. Twenty years later, some feel that compliance with the ADA is far behind what it should be — and they are seeking to change it, one lawsuit at a time.

For local businesses, ADA cases are a major hassle and an unexpected financial blow. The required improvements can costs thousands and sometimes tens of thousands of dollars, especially to bring older Fan-type businesses into compliance.

Swann did not respond to repeated requests for comment over several days. The head lawyer in her case, Stephan Nitz of the Florida-based law firm Schwartz Zweben, declined to comment when reached by RBS.

Gene Zweben, co-founder and partner of the firm, said the goal of the lawsuits is to improve accessibility for the clients.

"Clients contact us because they have problems getting into a facility. The final goal is for them to be able to utilize the facility," Zweben said.

Swann isn’t the first wheelchair pageant winner to obtain legal representation from Schwartz Zweben, which has filed similar lawsuits across the country. Ms. Wheelchair Washington, Ms. Wheelchair Florida and other winners, contestants and coordinators have been plaintiffs in cases represented by the firm in several states.

Zweben said they have become popular with pageant participants primarily through word of mouth. "We believe in what these individuals are looking for. A lot of them have issues with access," Zweben said.

In some cases, Zweben said, the firm sends a letter to the business before a lawsuit is filed in an attempt to resolve the issue without litigation.

"Some clients like to try and work it out, some others don’t. It typically doesn’t work," Zweben said.

ADA compliance cases rarely go to trial, as most are settled.

"Typically what happens when we file a lawsuit on behalf of a client — we let the opposing counsel know that we want to get it done as quickly and inexpensively as possible," Zweben said.

Zweben said that after the suit is filed they will have an expert conduct an inspection and write a report. The report is used as the basis for the settlement agreement, which outlines what needs to be done over a certain time frame.

Plaintiffs are not entitled to damages in ADA cases, but they are entitled to legal fees. Zweben said the legal fees vary widely.

"If the defendant is agreeable, there is very little time involved and the fees don’t run as high. If the defendant wants to fight and do that course and start engaging in discovery and so on, that can get quite costly," Zweben said.

In 2007, Zweben told the Baltimore Daily Record that the firm’s hourly billing usually is between $260 and $285 an hour.

Swann is just the latest individual to bring an ADA case before the U.S. District Court in Richmond. Since 2005, Maryland-based lawyer Joel Zuckerman has represented a handful of serial plaintiffs in 114 ADA suits against businesses in the Richmond area.

In 2010 alone, Zuckerman filed 30 such cases in the Richmond District.

Before signing on with his current law firm of Maxwell & Barke, Zuckerman was an attorney for the Rockville office of Schwartz Zweben. BizSense first wrote about him in March 2009. (You can read that story here.)

Michael Chenail was Zuckerman’s first local client and has been a plaintiff in eight ADA suits since 2005. He also runs a consulting business called Compliance Alliance. Most of his work comes from businesses that have been sued for ADA violations or sent a letter advising them that they face a suit if they don’t make changes.

Chenail said that over the past few years, local businesses have become more aware of ADA issues as a result of the multitude of lawsuits being filed.

"Any cases I have typically been involved in, [the defendant] has received letters first. More of those letters are being responded to without having to go into litigation," Chenail said.

Chenail also said he has noticed that more properties have improved accessibility and removed architectural barriers on their own accord.

"I have seen improvements made at some places that didn’t have anything to do with complaints or cases. There has been noticeable improvement in the Richmond area overall," Chenail said.

But the city and surrounding areas contain a stock of historic buildings that aren’t in compliance with ADA regulations, and therefore serve as fodder for lawsuits. Many property owners mistakenly think that their property is grandfathered in.

Zweben said for facilities built prior to the ADA, there are still standards that need to be met. Property owners are required to make "reasonable" improvements to accessibility, no matter the age of the facility.

"Barrier removal is still required. It might not be able to be done today because of financial reasons, but it may be able to be done over time," Zweben said.

BizSense was unable to reach several of the defendant businesses named in the suits.

Al Harris is a BizSense reporter. Please send news tips to Al@richmondbizsense.com.

Monday Q&A: Food pedaler pushes Richmond beyond pizza, Chinese

Richmond BizSense — Tue, 25 Jan 2011 00:52:29 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Amy David)

It began with four bikes, $5,000 and an idea for a food delivery service that was quick and didn’t depend on the use of a car.

New York native Frank Bucalo, 28, started Quickness RVA in June to pedal food from local restaurants to hungry patrons, minus the combustion engine.

Quickness works with such restaurants as Alamo BBQ, Fresca on Addison, Mama’s Kitchen, Strange Matter, Lamplighter Roasting Co. and Little Mexico Burrito Chop.

The pedal-powered delivery service carries food to Carytown, Shockoe Bottom, Church Hill, Jackson Ward and the Museum District, and Bucalo is working to add destinations.

BizSense caught up with Bucalo to see what fueled his idea.

Richmond BizSense: What gave you the idea?

Frank Bucalo: I’ve lived in a lot of places. I was raised in Brooklyn, where you can get anything delivered day or night, and biking is the preferred mode of transportation. I worked for different companies and was hired by one restaurant where I delivered food on a bike.

It’s why I chose the name Quickness. I think bikes are faster and more efficient than cars, especially for this city.

RBS: Why did you decide to bring it to Richmond?

FB: I’d been in Brooklyn for eight years and needed a change. I had been coming here to visit friends for several years, and Richmond seemed like a place I wanted to go.

I’d been here for a year and half looking for work, and one night I wanted to get food delivered and looked at my options, which were basically pizza and Chinese. I wanted more options, and I just began thinking of ways to do it.

RBS: So it was just you when you started out?

FB: Yep. I worked six days a week, 11 hours a day, using my bike and working out of my house. I worked with just one restaurant at first, and it was hard getting started, but I brought the idea to the city and went around to a few restaurants pitching the idea and it began to catch on.

RBS: How many restaurants do you work with now?

FB: We have six that we have contracts with that hire the company to do the deliveries. Fresca is new. It has only been open for about two months, and I feel we’ve had a big part in helping the restaurant get started.

We get a lot of requests from people asking us if we deliver to certain places, too, which in some cases is how we start working with them.

RBS: How often do you make deliveries and to what places?

FB: On average we do between 15 and 25 deliveries daily on each side of town. Orders come in all day long, but we’re usually busiest at lunch time. Businesses are a big part of that, mostly during the day. We deliver to salons, tattoo shops, a bunch of boutiques around Carytown, banks — it’s a pretty large variety.

We deliver to residential areas more on the weekends.

RBS: How long do deliveries usually take?

FB: Between 10 and 20 minutes, which I think is pretty good. Usually when you order delivery it ends up taking 40 or 45 minutes.

RBS: What do you do if the weather is bad?

FB: We go out in all weather. We’re delivering seven days a week from 11 a.m. to 10 p.m. In the rain, we just throw on some rain gear. That’s usually our best time, when the weather is too nasty for people to go out. We don’t mind it.

RBS: Have there been any problems getting food to the customers?

FB: No, things have worked out pretty well. We have baskets and thermal bags to keep the food warm. We go down to Shockoe Bottom constantly and never have a problem. We don’t normally deal with hills though. We try and stay on flat areas if we can.

RBS: What are your expenses?

FB: Right now our main expenses are rent, bike repairs and the thermal bags we use for deliveries. The local bike shops have been really supportive, though. They’ve offered to help my riders out if they have a flat tire or any problems, [which has] been nice.

RBS: Are you looking to add anything to Quickness?

FB: There some places in Carytown I’d like to start working with, and I’ve even been thinking of some places in Northside. It’d be cool to branch out that way. I’m also working on the idea of adding a tricycle and cargo bike for bigger deliveries, but that’s not anytime soon.

I’m mainly looking for things that would be useful to people here in Richmond.

For more on the latest business news in and around Richmond, visit RichmondBizSense.com and sign up for their email newsletter.

Seeds of discontent

Richmond BizSense — Thu, 13 Jan 2011 16:56:09 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Michael Schwartz)

Not all the drama happens in downtown boardrooms.

The executive director of a small farming nonprofit in Goochland says she has been ousted after speaking out publicly about how the board of directors handles the money.

Lisa Dearden was executive director of the Center for Rural Culture until last week. The organization, which operates on a $100,000 annual budget, provides educational programs for farmers and runs a popular farmers market in Goochland.

Dearden said she was called into a meeting with the CRC board on Jan. 7, and walked out a few minutes later — without a job and in shock.

“The board handed me a letter saying they accepted my resignation immediately,” Dearden said by phone just after the meeting. “But I didn’t resign.”

That was two days after Dearden sent out a letter to thousands of the group’s supporters describing how she was denied access to CRC’s books and how she demanded an independent audit to help clear up an alleged $30,000 discrepancy.

“I am writing to you all to inform you of important event which will affect the future of our center and its mission,” Dearden wrote in the letter.

The letter also gave an ultimatum: “This situation is untenable and my letter to the board demands the release of the CRC’s records for an independent CPA full audit. In addition, I no longer have confidence or trust in the board’s current and past presidents or the treasurer and I have asked for their resignations.

“Should my demands not be met, I will be resigning as executive director of the CRC effective January 31, 2011 and handing the matter over to law enforcement.”

The board apparently called her bluff on the threat of resignation.

The board released a brief statement in response:

“In light of the gravity of the allegations made by the executive director against specific members and the board as a whole, the Center for Rural Culture Board of Directors is taking action immediately to resolve all issues relating to its financial records.

“To that end, the Board is investigating the allegations and has sent its records to a CPA firm outside of Goochland County for resolution of the matter. The Board is unaware of any misappropriation of CRC funds. The Board intends to publish the findings of the CPA firm as soon as available.”

Dearden, 50, has been executive director of CRC for three years. During that time, she claims the board has never given her access to the books its treasurer keeps, despite repeated pleas.

Pressure mounted especially after Dearden said she found a $33,000 discrepancy in the treasurer’s report in November compared with the books she keeps on her own. Dearden said she was forced to keep her own ledger of the growing organization’s finances.

Dearden said she put out the letter as a sort of last resort in an effort to put pressure on the board members. But despite messages on the CRC Facebook page in support for Dearden and demanding a response from the board, the board remained silent on the issue until it released its brief statement yesterday.

Repeated messages left for several CRC board members to discuss the issue were returned over the past several days.

As for the mention in the letter of getting the law involved, Dearden said she has consulted a lawyer. But she insists she not accusing anyone of anything illegal.

“I’m not saying there’s money missing or misappropriated,” she said. “I’m just saying there are discrepancies that need to be accounted for. We need to have accurate books, and the executive director needs to have access to them.”

William F. Etherington, an attorney with Beale, Davidson, Etherington and Morris who represents non-profits, said it is unusual for a nonprofit executive director not to have access to an organization’s books.

“That would strike me as being odd, assuming that that’s true,” said Etherington. “You’re paying the executive to run the day-to-day operations of the organization. Part of the job of the executive director is to make sure the finances are in order.”

“It’s not generally a board responsibility to run the day-to-day operations of any association.”

But Etherington also said that an executive director typically serves at the pleasure of the board. And Dearden’s move to make the matter public is not something Etherington said he would advise.

“I can’t opine on whether the books were kept correctly or incorrectly, but if she wrote a letter like that, it’s not surprising the board would react like that,” he said.

Meanwhile, Dearden has had her hands tied. After her ouster, she was also forced to turn over her keys. So in effect, CRC is without an executive director. And Dearden said that doesn’t bode well for the organization.

“If I were to leave the organization, it would fall apart at this point. I’m not saying I’m indispensable … They [the board] don’t even know how to log into the computer.”

She says she just wants answers and to get back to work.

“It’s really, really sad, because a lot of people depend on us for their livelihood,” she said. “I’m fighting for those farmers out there, those little guys that depend on us.”

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Internet sweepstakes like their odds

Richmond BizSense — Thu, 06 Jan 2011 14:23:28 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Michael Schwartz)

In the face of skepticism and on shaky legal ground, controversial Internet sweepstakes cafes continue to roll the dice and open locations in storefronts across Richmond.

What began with Lucky’s Sweepstakes on Hull Street in September has spawned a dozen or so similar establishments where customers play casino-style computer games. And there are more on the way.

“These places are popping up everywhere,” said Holden Barnes, the store manager at VSF Sweepstakes Redemption Center, which opened a few months ago at 4501 W. Broad St.

VSF and its peers operate in a gray area of gambling law. Customers add money to swipe cards for Internet time and then sit down at computers loaded with casino-style games such as slot machines and poker. The purchase of the swipe card also buys them into a sweepstakes. Virginia law differentiates between a sweepstakes with predetermined odds and games that rely on the operator’s skill and luck.

“We’re not a gambling facility,” Barnes said, adding that customers purchase Internet time on the computers.

If during their Internet time customers play some of the games, which have predetermined odds, that’s their decision, Barnes said.

“I really don’t see an issue,” he said. “It’s entertainment for people.”

VSF, which is just up the street from the Colonial Downs off-track betting center, is advertising its newest location at 3907 Hull Street Road. It has another in Hopewell. The Florida-based company that owns VSF has plans to open several other locations across Richmond, Barnes said.

Lucky’s, which BizSense first reported on in September, has already moved to a larger location in the same shopping center to handle the brisk business. It also just opened a location in Petersburg.

Barnes said several competitors have opened nearby, including another off West Broad and one on Jefferson Davis Highway. Another is opening in the Southside Plaza shopping center across from the Lucky’s Hull Street location.

And a sweepstakes cafe is coming to downtown, according to a help wanted ad on Craigslist. The ad says it will be called Netzone 777, but an exact location isn’t listed.

Attitudes in the commercial real estate community and among property owners seem to be shifting as well.

Back in September, local commercial real estate brokers were skeptical about the influx of interest from sweepstakes owners looking at Richmond.

Just a few months later, according to Brian Glass, a senior vice president with Grubb & Ellis|Harrison &Bates, shopping center owners are questioning whether to lease to sweepstakes cafes, mostly because their legal status is up in the air.

“We’re seeing [an increase in sweepstakes cafes], but we’re also seeing that there’s a lot of skepticism on the part of owners,” Glass said. “There’s an undercurrent that the state legislators might take some action to ban them, similar to what happened in North Carolina.”

The owners of the sweepstakes shops are well aware of their uncertain future. Barnes said he and VSF’s owners know of the stigma attached to their business. They’re keeping a close eye on the new General Assembly session, as it is rumored that bills will be introduced pertaining to the legality of their business.

Glass said the sweepstakes owners are asking landlords for leases that allow them to get out if the law changes.

So for now the games go on, but those changes could be coming any day.

In late September, BizSense spoke with Harvey Bryant, the commonwealth’s attorney in Virginia Beach, where police raided about a dozen sweepstakes parlors last year.

Bryant said in September that he’s willing to bet that the games being played at sweepstakes locations in Richmond and elsewhere are almost identical to those in the raided Virginia Beach shops.

“There will be legislation introduced at the next General Assembly, some to open it up more, some to shut it down,” Bryant said. “It will be interesting to see which prevails.”

As of yesterday, no bills pertaining to sweepstakes cafes had been introduced in the 2011 GA session.

Another scenario that could play out is to simply regulate these Internet cafes, similar to other forms of legal gambling in the state.

“Other types of legalized gambling in Virginia are highly regulated; horse racing, charitable gaming, the lottery,” Bryant said. “There’s nothing overseeing Internet gambling.”

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Monday Q&A: A beer pong business? Have you been drinking?

Richmond BizSense — Mon, 15 Nov 2010 18:42:05 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Michael Schwartz)

Some of the best business ideas are hatched over a few beers. Of course, so too are some of the most harebrained.

Two Richmond pals are hoping the $8,000 they spent to patent a drinking game device ends up being the former.

The Pongerator, which keeps cups of beer cold while playing beer pong, is the brainchild of locals Matt Webb and Rob Kent.

The two were hanging out one afternoon and got an invite to go to a party to play some beer pong, a popular drinking game that involves tossing ping-pong balls into beer-filled cups.

Four years and thousands of dollars paid to patent attorneys later, Webb and Kent don’t have a prototype, and they don’t have a business plan. But as of Oct. 5, they have their patent.

Webb and Kent chatted with BizSense about their idea. An edited transcript is below:

Richmond BizSense: It’s not difficult to imagine where the inspiration for a beer-pong-related invention came from, but how’d you guys come up with it?

Matt Webb: Ideas come from necessity. But this wasn’t really one of those. It came from Rob complaining about not wanting to play beer pong because the beer gets warm. And I think I was like, “someone should do something about that.”

Rob Kent: We had our creative juices flowing.

RBS: So you filed a patent four years ago. How hard was it to wait?

MW: It was easily put aside, and you have your doubts big time.

RK: The process really was so long. When we first came up with it, we were gung-ho. But then it takes so long, and you’re like, “Have I just been throwing away money [to pay patent lawyers]?” We’ve invested roughly $8,000. Now we own a patent that is worth something. We’re just trying to find out what it’s worth. We don’t know what route we’re going to take, but we are going to pursue it. We don’t want to be 50 or 60 years old and have some dude be a millionaire with the same idea.

RBS: You found out there’s some competition selling basically the same product, but you guys got the patent first. How are going to handle that?

RK: We’ve known about them for a couple years: the N-Ice Rack guys. http://www.n-icerack.com/ We figured we filed before them, but we weren’t sure. Right now, we’re just sending them a friendly letter, making them aware of us. We’ll enclose our patent. I think we hold all the cards, but you never know.

MW: They obviously had a good idea, but we beat them to it. We’re going to try to form friendships rather than nasty business relationships.

RBS: So how do you plan on turning an idea and a patent into a business? And what if the competition tries to buy you out, seeing as they already have an actual product?

RK: Licensing is something I’d look at. We’re leaving every option on the table.

MW: Maybe they are going to treat us like Matt Damon and Ben Affleck and this is our “Good Will Hunting.”

RBS: Have you had offers yet?

MW: We had one guy say, “Give me 50 percent, you guys each take 25 percent and I’ll take care of everything.”

RBS: Or could you take the other route — form your own company, manufacture, sell and market these things yourselves?

MW: I want to revolutionize the game. I don’t know how yet. I think one of the important things is to think bigger than beer pong. That’s our next step. You don’t have to just put beer in. How about at the picnic table to keep your beverages cold? Who needs ice? Get a Pongerator already. Should that be our slogan? We could put logos on. We could personalize it. The options are endless. The keyword is marketing. We’ve joked about having the Pongerator Girls – because sex sells. But we’re not even at the step.

RBS: What about the old saying that you should never do business with your friends?

RK: There’s an exception to every rule.

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Baking is in his blood

Richmond BizSense — Mon, 15 Nov 2010 18:20:44 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Al Harris)

A local bagel entrepreneur is following his gut and expanding from the West End to downtown.

Walter Baietti opened Cupertino’s New York Bagels and Deli in the West End about three and half years ago in the newly built Twin Oaks Shopping Center near Cox and Broad.

Prompted by customer demand, Baietti and his two sons are preparing to open a new location downtown at 1215 E. Main St.

“A lot of people that come here work in offices downtown, so we thought it would be a great idea since no one else is there doing what we do,” Baietti said.

Baietti said he hopes to be open by December. And although this will be his second shop, he has a long pedigree in the business and hails from the land of great bagels.

Baietti and his family moved from just outside New York because his wife worked for MeadWestvaco and got transferred to Richmond. Before moving, Baietti had owned a catering business.

“I sold my business in New York, came down here and hated the bagels,” Baietti said.

Fortunately for Baietti, baking was in his blood. The family tradition began when Baietti’s grandfather Frank Cupertino opened a bakery in the Bronx in 1926.

Transplanted to a city were frozen bagels are the norm, Baietti was compelled to take matters into his own hands and start a new business.

Baietti said locals were slow to catch on at first, but now customers are hooked.

“A lot of people are getting used to these bagels now because they know the quality,” Baietti said.

The legacy continues with Baietti’s two sons, Walter Jr. and Nicholas, who he says will manage the new store together.

Walter Jr. now spends most days in the kitchen at the Twin Oaks location where Cupertino’s churns out 1,800 bagels a day. His day sometimes starts at 11 p.m. to make sure the bagels are ready for wholesale deliveries by 5 a.m.

“The bagel business is a lot harder than people may think,” said Walter Jr. “There is a lot of labor involved. You’ve got to mix and shape the dough and bake it, and all that take a lot of time.”

The new location will have an oven for baking its own bagels on-site, while Cupertino’s wholesale bagels, which go out to a number of cafes around town, will continue to be baked in the West End.

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For more restaurant news and information on other happenings in the Fan, stop by Fan of the Fan.

Sports bar franchise inches closer

Richmond BizSense — Wed, 10 Nov 2010 16:37:01 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Al Harris)

Slow and steady, it’s not.

The Greene Turtle sports bar chain is one of the fastest growing restaurant franchises in the country, and it plans to stake its claim in the Richmond area.

“Obviously Richmond is an untapped market now for us. We are looking to find some people that are operators who are interested in developing that area,” said Mike Sanford, president and chief executive of the Maryland-based company.

The Greene Turtle entered Virginia last fall with a corporate location in Fredricksburg. Since then it has merged multi-store contracts with franchisees in Leesburg, Fairfax and Chesapeake. The company is also opening another corporate-owned store Hampton.

“After next week, we’ll have four stores open and another eight committed to Virginia as a whole,” Sanford said.

They have 10 to 12 stores scheduled to open in D.C., Delaware and Maryland, he said. Last April, the company announced that it wanted to add 150 East Coast locations over four years.

As part of that, Sanford envisions up to eight locations in the Richmond/Petersburg area. It also turns out that Sanford has a local connection.

Sanford graduated from University of Richmond in 1976 with degrees in marketing and business administration. He also played basketball there.

He went back to Maryland, where he eventually opened a Greene Turtle store outside D.C. in 1990.

By 2003, the Greene Turtle had five locations. It started franchising in 2003, but things really started to take off when private equity firm JPB Capital bought a majority stake of the company for an undisclosed price in 2007.

Infused with capital, the company was ready to expand. But the Turtle was facing a hurdle: the economy.

“The big hurdle that has been the elephant in the room for the last couple years is the whole financing situation,” Sanford said.

The start-up costs for franchisees is as much as $1.5 million, Sanford said. That is mostly spent on building out the physical restaurant.

“We’ve got to be creative to get financing. A lot of the normal financing from banks has a lot tighter reins when it comes to lending money,” Sanford said.

On the other hand, Sanford said, the company might have picked the right time to expand — when rental and construction rates were going down.

“It used to be we would have to go and put on a huge dog and pony presentation to say, ‘Please let us come into your site.’ Now we get the phone calls from developers that want us to be part of their projects because they see that we would be a benefit to the project,” Sanford said.

“That is one of the nice things that happened.”

As for Richmond, Sanford says the company’s franchise development team is starting to do some advertising and plans to meet potential franchisees in the coming months.

“I would expect within the next six to nine months to have some deals in place to develop the Richmond market,” Sanford said.

Al Harris covers the restaurant industry for BizSense. Please send news tips to Al@richmondbizsense.com.

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The Circuit City Story

Richmond BizSense — Wed, 03 Nov 2010 14:06:25 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Aaron Kremer)

A local filmmaker has turned his lens on his former employer, which also happens to be one of the biggest corporate flameouts in Richmond history.

Tom Wulf, 50, just finished “A Tale of Two Cities: The Circuit City Story,” a self-financed documentary that traces the company’s history from its birth on Broad Street to its demise in 2008 and 2009.

The film premieres tomorrow night at the Virginia Film Festival in Charlottesville. Wulf, who moved to Richmond in the 1980s to work in training for Circuit City, said he wants to have a local showing in a month or two.

“I had a picture that hung on my wall of [Circuit City founder] Sam Wurtzel, and when I left the company I sent that picture back to Alan, his son. Then I asked him if he’d grant me an interview because I had an idea about a documentary,” Wulf said.

Throughout the movie, Sam Wurtzel is painted as the ballast and spiritual leader of the company. It was his emphasis on customer service that helped the company get off the ground, initially selling TV sets to African Americans from a shop on Broad Street. Then the company added other appliances and soon branched out to other markets.

Through interviews with Alan Wurtzel, former Circuit City presidents and rank-and-file support staff, Wulf explores how one of Wall Street’s darlings went into a slow decline and then collapsed in 2009 after suppliers would no longer lend the company inventory. But that was really just the straw that broke the camel’s back.

The film is broken into two parts: One that explains how the company started in the 1930s and grew as Wards (the name wasn’t changed to Circuit City until the 1980s) and one that explains how it lost its competitive edge over the past 20 years (same-store sales began slipping, Best Buy gained market share, gambles didn’t pay off) and eventually collapsed.

“In the end, Circuit City put so much emphasis on shareholders and spent so much energy driving up the P/E ratio and stock that they forgot the customers,” Wulf said.

“The company also was on top so long, it didn’t pay attention to competition,” he added. “They stopped listening to the customer service associates.”

Several major figures declined to be interviewed, including former chief executives Rick Sharp and Phil Schoonover, who was voted the worst CEO in America by a national business magazine in 2008.

The film uses lots of videos – former Circuit City ads, internal management training videos and news reports – as it chronologically tries to explain what made the company so successful through the 1980s and what made it sluggish over the past 15 years.

For example, to show how the company kept changing its marketing strategy and slogan, Wulf cuts to old ads. One has the tag line, “We’re with you.”

That was changed in 2004 to, “Just what you needed.”

None of those changes mattered much, according to Wulf’s account. The company made several blunders, such as signing 30-year leases on buildings that were eventually situated in sub-optimal neighborhoods and gambling $750 million on a failed video rental disc.

Perhaps most fatally, the documentary posits, the company purchased almost a billion shares of its own stock this decade. If it hadn’t done that, the film suggests, it would have been able to weather the recession instead of filing for bankruptcy protection and then liquidating.

The film, which is 95 minutes, also has powerful interviews from some of Richmond’s top business leaders and from Alan Wurtzel.

Wurtzel speaks candidly and at one point says that during the Schoonover years, the company was just grasping for straws.

“If it didn’t have a good margin, we did not want it,” Wurtzel said of the policy to not stock as much merchandise as archrival Best Buy. “So we did not have games, which was key to attracting kids, and we did not have as many models of computers.”

For Wulf, the film is intensely personal. The former TV journalist left the news business in the 1980s to work as a sales representative for Circuit City in Atlanta. Wulf then worked his way up and was hired in Richmond to work on management training. He then worked at CarMax for 12 years.

Aaron Kremer is the BizSense editor. He has several ideas for documentaries. Please send news tips to Editor@richmondbizsense.com.

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Swapping pseudo-police cruisers for Priuses

Richmond BizSense — Tue, 19 Oct 2010 15:34:52 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Amy David)

The Crown Vic’s days are numbered at Groome Transportation. And in addition to reducing pollution, that means Richmond motorists can stop slowing down when they mistake Groome’s Crown Victorias for police cruisers. (Click here to read a funny satire post about that.)

Within the next six months, the local limo/shuttle company plans to go completely green and save some green by replacing its fleet of cars with hybrid and alternative fuel vehicles.

“By February 2011, we’re hoping to have all [Toyota] Prius cars,” said Chris Groome, the company’s vice president of safety and service. “Our goal is to provide safe and reliable transportation in the greenest way possible.”

Groome, which has been in business since 1947, began its environmentally friendly transition in September and has replaced four of its Ford Crown Victorias with Toyota Prius hybrids. It will invest in 12 hybrids and is working to convert its fleet of vans and mini-buses to run on propane fuel. It has 40 vehicles in its Richmond fleet.

Besides improving the environment, going green could eventually help Groome improve its bottom line. The Prius gets 51 mpg in city driving and 48 mpg on the highway.

“We anticipate reducing our fuel cost on this segment of our fleet,” Groome said.

Although the fuel savings might be noticeable, a full transition to hybrid vehicles isn’t cheap in the short term. According to Virginia Clean Cities’ green fleet buying guide, a Toyota Prius is about $21,000. Groome said the company will spend around $200,000 to change over its fleet.

There are also some financial incentives Groome is pursuing to help fund the transition. It applied for an $80,000 grant from Virginia Clean Cities to help switch its vans and mini-buses over to propane.

Groome Transportation isn’t the first car service company in the area to switch from regular cars to more eco-friendly wheels.

Richmond Bio Taxi is a sustainable taxi service run by brothers Jeff and Joey Anderson. They came up with the idea to use cooking oil from local restaurants and convert it to bio-diesel fuel using a Mercedes E-class sedan. (Read more about their story here.) They’ve since added a second VW.

Although BioTaxi has been up and running since June 2010, Groome said Groome Transportation didn’t choose to start going green because of competition.

“They weren’t even on our radar,” Groome said of Bio Taxi. “We wanted our customers to have the same comfortable riding experience — just a greener, more cost-effective one.”

Groome said it hopes its new fleet will eventually attract more business.

“People aren’t requesting it yet, but they like having a green ride and have been pleased after using the Prius.”

Amy David is a BizSense reporter. Please send news tips to Amy@richmondbizsense.com.

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Green flag drops on indoor racing

Richmond BizSense — Wed, 06 Oct 2010 14:14:20 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

Local race fans don’t have to wait until spring to watch stock cars zipping around a race track.

Starting in mid-November, mini race cars will compete at 50 mph on a wooden track in the Richmond Coliseum.

Mechanicsville-based Arena Racing USA has been running its miniature brand of racing at the Hampton Coliseum. That league will stage five races at the Coliseum.

This isn’t the first time Arena Racing has put on an event here. “The first time we did this was back in 1993, and we had 4,700 fans,” said Ricky Dennis, the founder and president.

Arena Racing brings in most of its revenue through ticket sales and sponsorships. Dennis said he’s got Chik-fil-a, Interstate Batteries, Dominion Auto Group and BB&T lined up as sponsors of the Richmond series.

Dennis said he wants to expand to 15 events here. Arena Racing has occasionally been mentioned as one of the future events at SportsQuest, a mega sports complex planned for Chesterfield County.

The Coliseum could surely use the business. It has been criticized as outdated and lost its hockey team last year when the Richmond Renegades shut down.

Dennis said he’s not scarred by the failure of minor league hockey at that venue.

“The Coliseum isn’t as bad as everyone says it is. And the hockey model is a tough model to make work. Arena Racing is very successful with 15 events, and we understand now how to put them together,” he said. “We’ve finally figured it out.”

Aaron Kremer is the BizSense editor. Please send news tips to editor (at) richmondbizsense.com.

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Little comfort in nonprofit shakeup

Richmond BizSense — Tue, 05 Oct 2010 15:34:35 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Michael Schwartz)

A shakeup at the top of a local nonprofit is causing a commotion among its supporters.

The drama began when the founder and former chief executive of Richmond-based Comfort Zone Camp ceded some of her power in February. She sought to regain control in September and was denied by the organization’s board of directors. Now she’s leaving the organization altogether, and a debate has erupted on Facebook about why she was ousted and what it all means for Comfort Zone’s future.

The story was made public last week when Comfort Zone’s board sent out a letter that vaguely explained the reasoning but didn’t offer anything too specific about the board’s decision not to reinstate founder Lynne Hughes as CEO.

“On September 27, 2010, the Board of Directors faced an excruciatingly difficult decision regarding the leadership of Comfort Zone Camp, and the future stability and growth of the organization,” the letter began.

Comfort Zone was founded in 1999 by Hughes as a small bereavement camp to help children cope with losses. It has grown into a multimillion-dollar operation with locations across the country.

But that growth has brought some problems.

“In February 2010, the Board was made aware of significant management issues, which called into question the organization’s ability to sustain its mission,” the board’s letter stated.

See the board’s full explanation here.

At that time, Hughes and the board agreed that she would step down as CEO. Hughes stayed on as president and founder, and a new CEO was hired.

But that didn’t last long. A few months later, according to the board’s letter, Hughes wanted to regain full control of the organization, including over the financials, and the power to hire and fire employees.

The board didn’t agree and offered her the position of visionary, spokesperson and strategist. She declined, making it clear that she would leave the organization if her demands weren’t met.

The board, which is made up of an impressive roster of business executives, stood firm.

“The board voted unanimously that this solution – putting Lynne in the CEO role – would not be in the best interest of the organization,” the letter stated.

Hughes will no longer be an employee of Comfort Zone after Oct. 8.

The debate is now online. A Facebook discussion page is filled with emotional reactions from campers’ parents, volunteers and others. The responses include anger toward the board, with some users renouncing their financial support for the organization and others pleading that supporters keep their eye on the organization’s mission to serve the children, not its CEO.

Rick Long, chairman of the Comfort Zone board, told Richmond BizSense on Friday that the organization was prepared to deal with some backlash for its decision.

“Obviously when you change out CEO and the founder leaves, it’s a big deal,” Long said.

Comfort Zone said Friday that Hughes was not available. There was no response to an email sent to Hughes.

“In a situation like this, there’s always going to be multiple sides to the story,” Long said.

“This was a very thoughtful, deliberate process,” Long said. “There are some pretty seasoned executives on that board. We didn’t take it lightly.”

Long said the board was also aware that there might be some financial backers who decide to no longer donate to the group because of the shakeup.

“Inevitably, they’ll be some people that have given in the past that won’t give in the future,” Long said.

One of the biggest supporters has been New York Life, which gave a three-year, $3 million grant to Comfort Zone. Long said they are now in the third year of that deal.

“Anytime you take on that responsibility, it’s not just to do what the CEO wants, it a fiduciary duty,” Long said. “There are a lot of people that have given a lot of money to this organization.”

Matt Paxton, a local businessman and five-year volunteer at Comfort Zone, said that although the organization wouldn’t exist without Hughes, there is more to Comfort Zone that just her.

“Although Lynne [and family] were a huge part of the camp, I think it’s a disservice to the thousands of volunteers, campers and employees of CZC to act like the place will fall apart just because one person is leaving,” said Paxton.

“If the camp’s goal is to support grieving children around the country, than they made the right call and the board should be commended for making a difficult decision.”

Comfort Zone has grown quickly since being founded in 1999. In 2006, Comfort Zone had $2.1 million in revenue and $892,000 in expenses, according to IRS tax forms. Hughes was paid $75,000 that year.

By 2008, revenue was up to $3.2 million, and expenses were up to $1.6 million. Hughes was paid $105,000 that year.

Michael Schwartz is a BizSense reporter. Please send news tips to Michael@richmondbizsense.com.

For more on the latest business news in and around Richmond, visit RichmondBizSense.com and sign up for their email newsletter.

Filling Richmond’s bagel hole

Richmond BizSense — Tue, 28 Sep 2010 15:01:38 +0000

This story first appeared on RichmondBizSense.com, Richmond’s leading source for business news.

(From Al Harris)

It has been a long time coming, but Richmond is getting another shot at having its own homegrown bagel place.

Husband and wife Kevin and Jacqueline Sharman are setting shop in Carytown, and by the end of October they hope to fill the city’s bagel hole with Jaks Bagels & Deli.

“We felt like there was a need for good bagels,” said Jacqueline Sharman. “We shopped and shopped for the perfect place until we ended up driving down Cary Street one Sunday and found the pink door.”

For now the space at 3443 W. Cary St. is completely empty, but Sharman said they are starting work soon.

Sharman, an attorney for Pagano & Associates in Sandston, said the venture is being funded by some investors, a bank loan and some of their own capital. Her husband is leaving his job as a transportation director for a construction firm to run the restaurant, while Sharman said she will continue to practice law.

Richmond isn’t exactly known for its bagels. There is Cupertino’s out in Innsbrook, which has gained some buzz around town, and a local shop called Bagel Czar briefly operated a few years ago at 929 W. Grace St. but didn’t last. There was also the homespun chain Lazy Bagel, but that closed, too.

Nonetheless, Sharman said Richmonders are hungry for more bagel options.

“The response we’ve gotten on our website has been outstanding. Go to any Panera at lunch time, and the lines are out the door,” Sharman said.

The Sharmans have been kitchen-testing their bagel recipe since coming upon the idea in February. She knew they had it perfected once her husband couldn’t get enough.

“I love bagels. My husband never had a good bagel and didn’t even like bagels before we developed our own recipes. He has since become a fan,” she said.

In addition to bagels, the shop will serve coffee and sandwiches. They have also leased the upstairs and are planning a catered conference room for business and other group meetings.
BizSense talked with a former bagel entrepreneur back in July. You can read his story here.

Al Harris is a BizSense reporter. Please send news tips to Al@richmondbizsense.com.

For more on the latest business news in and around Richmond, visit RichmondBizSense.com and sign up for their email newsletter.

For more information on this, check out previous coverage on West of the Boulevard News.

“Sweepstakes” businesses gamble on Richmond

Richmond BizSense — Fri, 24 Sep 2010 19:09:17 +0000

The state lottery isn’t the only game in town for gamblers. At least until local police departments find a justification to shut down the increasingly controversial industry of Internet sweepstakes cafes.

Lucky’s Sweepstakes opened two weeks ago in a storefront on Hull Street and Belt Boulevard. And judging by the statistics on https://www.bestuscasinos.org/real-money/ of the brisk flow of customers playing computer-based slot machine and poker games, it's clear that business is booming.

However, authorities are cracking down on these sorts of businesses around Virginia. And they were banned in North Carolina.

It’s difficult to discern how the businesses differ from legal gambling (Bingo) or illegal gambling (a cash poker game) but in previous news stories, operators have said that their customers are buying cards with Internet time that also enter them into sweepstakes. And that Virginia law differentiates between a sweepstakes with pre-determined odds and games that rely on the operator’s skill and luck.

RBS checked Lucky’s out yesterday and played a few rounds of slots and use these codes to play poker to get a feel for how the system works.

The first thing that’s noticeable – it smells like a casino. That’s because smoking is allowed.

It sounds like a casino. The electronic sounds of slot machines echo from the computers’ speakers and people complain about burning through their money.

There are free drinks like a casino. But only soda and water.

Money evaporates as fast as it does at online casinos for South African residents. Customers buy time on one of about 15 computers to play different types of games, mostly consisting of slot machine games, poker, sports betting with paypal and keno. That time is also labeled sweepstakes points that are used to play a hand of electronic poker or pull the electronic wheel of the slot machine. It can also be used to surf the Internet or make copies.

Wagers can be as low 20 cents on some games and up to $2. The 1,000 “sweepstakes points” or $10 on RBS’s Lucky’s swipe card disappeared into the electronic void within about 30 minutes. RBS built up 625 points worth of winnings, equal to $6.25. That money could either be cashed out or put back into the sweepstakes point stack to play with.

Getting a swipe card also puts your name in a weekly $125 sweepstakes.

At around 5:00 p.m. Thursday, the place was busy with about 10 people playing. The store managers, who didn’t want to be officially interviewed, said the place is open from 10:00 a.m. to 2:00 a.m. Some of the busier hours begin around 4:30 weekdays when people starting getting off of work.

And the market is apparently ripe. One of Luckly’s managers said the owner has plans to open several locations around Richmond.

Lucky’s is operated under Internet Sweeps Café LLC. The business license is in the name of a Pinehurst, N.C.-based entity of the same name.

Local commercial brokers say they’ve seen an increase lately in inquiries for retail space.

Brian Glass, a senior vice president with Grubb & Ellis|Harrison & Bates, said after studying the numbers coming from casino games UK, has insights that will make his next venture climb faster than before. He has come across several such gaming cafes looking to lease space in local shopping centers, but was unaware of any that were open yet.

But the commercial real estate community isn’t quite sure what to make of them.

Glass said there is, “A lot of skepticism inside the brokerage community about this type of business…Landlords should be very cautious…”

Peter Bunin, a vice president at S.L. Nusbaum who leases shopping centers, said he has had inquiries from Internet gaming cafes for center space. But he says he has turned them all down, partly because of the uncertain legal environment developing around the enterprises.

So the big question is – is it gambling? Are these more or less storefront casinos?

Virginia Attorney General Ken Cuccinelli responded in July to state Del . Bill Janis of Glen Allen’s request for an advisory opinion.

“You ask whether prizes offered by a retail provider of internet and computer services are permissible or whether they constitute illegal gambling under the laws of Virginia when entries to win prizes are available to persons who purchase computer time as well as to those who do not.”

“It is my opinion that additional info will be required but as of yet, the element of consideration is missing, and therefore no illegal gambling occurs, when the opportunity to win a prize is offered both with a purchase and without the requirement of a purchase.”

That didn’t keep Virginia Beach police from raiding about a dozen such businesses this week, as was reported by The Virginian-Pilot.

Michael Schwartz is a BizSense reporter. Please send news tips to Michael@richmondbizsense.com.