A-M Electric Inc. - Syracuse, NY
“The forms and the structure they require is exactly what a business needs. It’s very focused, very tight,” Herbert says. “I learned how to manage money per project, rather than just circulate it. It allowed me to see my costs and recognize my profits. It doesn’t matter how smart you are about your industry—money is a whole different mindset.”
Joseph “Sepp” Herbert learned about the state’s Bridge to Success loan program through a manager at the Syracuse Dormitory Authority. Herbert owns A-M Electric Inc., an established electrical contractor in the Syracuse area and a state-certified Minority-Owned Business Enterprise. Over the years, A-M Electric contracted for municipal jobs, but the lag time for getting paid severely limited Herbert’s ability to meet payroll and cover operating expenses
With companies sometimes waiting up to 90 days to get paid for government work, Herbert wondered how he’d manage the company’s finances if he secured the bid for the eight-month lighting retrofit project for the Syracuse Dormitory Authority. That’s when the agency’s director pointed Herbert to NYBDC, one of five designated lenders for the Bridge to Success Loan Program.
“It opened up opportunities all over,” says Herbert, whose business employs a full-time crew of six. He bid for and won the Dormitory’s lighting job, and the $195,000 Bridge to Success bridge loan he secured through NYBDC gave him the working capital to run his business more efficiently.
The Bridge to Success Loan Program provides short-term loans to New York State-certified Minority and Women-Owned Businesses (MWBEs), so that they secure state contracts. State contract payment cycles frequently take longer than what is financially feasible for MWBEs, and the delay in getting paid poses significant barriers to these firms.
“It would have been a struggle, just covering my payroll,” Herbert says. “This line of credit gave me the finances to cover my payroll and pay benefits every month. It gave me some financial freedom. Plus, because I could manage the job on the property and was not having to spend time moving money around, we were able to finish the work one month early.”
Bridge to Success, started in 2014, makes at least $20 million in short-term loans available to MWBEs for working capital while they are executing state contracts. Loans typically range from $75,000 to $200,000, with terms running from eight to 18 months. NYBDC was one of five original lenders designated by New York’s Empire State Development Corp. to participate in the loan program.
“NYBDC was able to approve financing under the Bridge to Success program, which in turn enabled the borrower to successfully complete the work. Based on that success, a second contract was assigned and additional funding provided,” says Steve Willard, senior vice president, NYBDC.
Herbert, who moved to the United States from Barbados in 1990, took many business courses over the years that helped him better lead the company and manage employees. Still, he says, the education he received while making his way through the loan application process equipped him with a new level of financial know-how.
Through the cooperative efforts of its lending partners, New York Business Development Corporation (NYBDC) promotes and advances the business prosperity and economic welfare of New York State by providing small business loans. Throughout its 60-year history, NYBDC has provided thousands of small businesses, including start-ups, mature businesses, and minority- and women-owned businesses, with access to loans when they do not meet the requirements for traditional financing. Learn more at www.nybdc.com.
Together with affiliates Excelsior Growth Fund (www.excelsiorgrowthfund.org) and The 504 Company (www.the504company.com), NYBDC offers small businesses access to suite of financing options that includes SBA 504, 7a and Community Advantage loans, as well as online alternative loans.