1. Small firms thrive but aren't expanding | Crain's New York Business
http://www.crainsnewyork.com/article/20141118/SMALLBIZ/311169993/small-firms-thrive-but-arent-expanding[11/19/2014 12:50:29 PM]
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Small firms thrive but aren't expanding
Some may not want the hassles that come with growth; others need a helping hand.
BY ELAINE POFELDT
NOVEMBER 18, 2014 12:30 P.M.
ARTICLE COMMENTS
Paul Vieira beat the odds at IDL Communications & Electric, a Staten Island contractor in the
telecommunications field. He's grown the firm to 25 employees and $10 million in annual revenue since 2001.
"When you start a business, you always think the sky is the limit," he said.
That makes him a rarity in a city where many small businesses never grow into job creators. The number of
firms with up to four employees had a net gain of 31,421 jobs between 2000 and 2013, the Center for an
Urban Future found in recent research. In comparison, firms with more than 500 employees saw a net loss of
5,022 positions.
The think tank concluded that "too few" small firms are expanding into medium-size and large businesses, and
is calling on the de Blasio administration to help more of the tiny firms grow.
"From our perspective, the really key opportunity for New York is to make sure more of these very small
businesses are able to expand into modestly larger businesses," said Jonathan Bowles, executive director of the
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2. Small firms thrive but aren't expanding | Crain's New York Business
http://www.crainsnewyork.com/article/20141118/SMALLBIZ/311169993/small-firms-thrive-but-arent-expanding[11/19/2014 12:50:29 PM]
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center. The report was funded by Citi Community Development, an arm of Citigroup that focuses on financial
inclusion and economic empowerment.
More freelancers
Whether many of these tiny firms want to grow, however, is a subject of some debate. New York is home to
many freelancers whose main ambition is to create a job for themselves—not necessarily to build the next
Facebook. Their numbers are rising, according to another recent study by the center. It found that New York is
home to 247,025 self-employed workers, with their ranks increasing 31% from 2000 to 2012. Brooklyn has
the greatest number: 72,503.
What's happening in New York reflects national trends. The U.S. Small Business Administration released data
earlier this year that showed that nearly three-quarters of small businesses create jobs only for the owners—and
the number of such firms has been growing since 2000. Meanwhile, the number of job-creating firms has been
flat.
"The majority of small businesses and independent workers don't have growth as a primary objective," said
Steve King, a partner in Emergent Research, a company in Lafayette, Calif., that studies the independent
workforce. "They're doing it to create a job for themselves and a lifestyle for themselves." If they have to hire,
many turn to contractors, he added.
Freelance copywriter Debbie Feldstein is among these solo operators. She made a conscious decision not to
hire employees after a long career running a nonprofit. She doesn't want to manage them.
"I think that's why so many people who are freelancers seem happier than other people," said Ms. Feldstein.
"They've kind of decided, 'This is my niche. I'm not going to conquer the world. I'm not going to be a million-
dollar copywriter. I'm just going to have this good career that supports me.' "
'Huge boost' for NYC
Mr. Bowles said that even if some microbusinesses don't aim to grow, it's still worth lending more support to
the ones that do. "A number of them have real potential for growth," he said. "If we can get more of these
four-employee companies to be 10- or 20-employee companies, that's a huge boost for New York City's
economy."
The center's report urges the de Blasio administration to focus more of the programs run by the NYC
Department of Small Business Services on helping existing firms scale up. Many current programs encourage
the launching of startups, the report notes. Entrepreneurs say access to funding, in particular, is critical to
growth.
Deb Windsor, who is profiled in the report, founded ConstructionKids, an education workshop in Brooklyn, in
2008. What helped her expand to 60 people during the peak summer months and hit $1 million in annual
revenue was receiving two grants—one for $25,000 and a more recent one for $100,000—through the city's
Economic Development Corp. She has used the first cash infusion to formalize her training program and invest
in technology.
"It was just a fantastic way to help a small business jump-start itself," Ms. Windsor said.
A version of this article appears in the November 17, 2014, print issue of Crain's New York Business.
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3. Small firms thrive but aren't expanding | Crain's New York Business
http://www.crainsnewyork.com/article/20141118/SMALLBIZ/311169993/small-firms-thrive-but-arent-expanding[11/19/2014 12:50:29 PM]
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![Small firms thrive but aren't expanding | Crain's New York Business
http://www.crainsnewyork.com/article/20141118/SMALLBIZ/311169993/small-firms-thrive-but-arent-expanding[11/19/2014 12:50:29 PM]
Print Email Reprints Comment
Small firms thrive but aren't expanding
Some may not want the hassles that come with growth; others need a helping hand.
BY ELAINE POFELDT
NOVEMBER 18, 2014 12:30 P.M.
ARTICLE COMMENTS
Paul Vieira beat the odds at IDL Communications & Electric, a Staten Island contractor in the
telecommunications field. He's grown the firm to 25 employees and $10 million in annual revenue since 2001.
"When you start a business, you always think the sky is the limit," he said.
That makes him a rarity in a city where many small businesses never grow into job creators. The number of
firms with up to four employees had a net gain of 31,421 jobs between 2000 and 2013, the Center for an
Urban Future found in recent research. In comparison, firms with more than 500 employees saw a net loss of
5,022 positions.
The think tank concluded that "too few" small firms are expanding into medium-size and large businesses, and
is calling on the de Blasio administration to help more of the tiny firms grow.
"From our perspective, the really key opportunity for New York is to make sure more of these very small
businesses are able to expand into modestly larger businesses," said Jonathan Bowles, executive director of the
Sign up for our FREE weekly Small Business Alert
email newsletter. An essential summary of the week's top
headlines selected for small businesses.
VIEW SAMPLE Â | Â NEWSLETTERS
Get Crain's Small Business Alert
LATEST NEWS MOST POPULAR
Forest City Ratner buys out its modular partner
Blackstone to sell tower for $2.3B
Making Crain's list of top private companies
To secure its place, Chelsea gallery buys space
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News Home Current Issue Real Estate Small Business Health Care Politics Technology More Industries
NEWS OPINION FEATURES CURRENT ISSUE EVENTS DATA & LISTS VIDEOS NEWSLETTERS CUSTOM CONTENT
Subscribe
Go](https://image.slidesharecdn.com/f310db80-afe5-4132-8d5e-35afc423fb2e-151004210302-lva1-app6892/85/Crain-s-New-York-Business-Article-11-2014-1-320.jpg)
![Small firms thrive but aren't expanding | Crain's New York Business
http://www.crainsnewyork.com/article/20141118/SMALLBIZ/311169993/small-firms-thrive-but-arent-expanding[11/19/2014 12:50:29 PM]
PREVIOUS ARTICLE
Businesses step up holiday social-media game
SMALL BUSINESS TECHNOLOGY SMALL BUSINESS COLUMN
Print Email Reprints Comment
center. The report was funded by Citi Community Development, an arm of Citigroup that focuses on financial
inclusion and economic empowerment.
More freelancers
Whether many of these tiny firms want to grow, however, is a subject of some debate. New York is home to
many freelancers whose main ambition is to create a job for themselves—not necessarily to build the next
Facebook. Their numbers are rising, according to another recent study by the center. It found that New York is
home to 247,025 self-employed workers, with their ranks increasing 31% from 2000 to 2012. Brooklyn has
the greatest number: 72,503.
What's happening in New York reflects national trends. The U.S. Small Business Administration released data
earlier this year that showed that nearly three-quarters of small businesses create jobs only for the owners—and
the number of such firms has been growing since 2000. Meanwhile, the number of job-creating firms has been
flat.
"The majority of small businesses and independent workers don't have growth as a primary objective," said
Steve King, a partner in Emergent Research, a company in Lafayette, Calif., that studies the independent
workforce. "They're doing it to create a job for themselves and a lifestyle for themselves." If they have to hire,
many turn to contractors, he added.
Freelance copywriter Debbie Feldstein is among these solo operators. She made a conscious decision not to
hire employees after a long career running a nonprofit. She doesn't want to manage them.
"I think that's why so many people who are freelancers seem happier than other people," said Ms. Feldstein.
"They've kind of decided, 'This is my niche. I'm not going to conquer the world. I'm not going to be a million-
dollar copywriter. I'm just going to have this good career that supports me.' "
'Huge boost' for NYC
Mr. Bowles said that even if some microbusinesses don't aim to grow, it's still worth lending more support to
the ones that do. "A number of them have real potential for growth," he said. "If we can get more of these
four-employee companies to be 10- or 20-employee companies, that's a huge boost for New York City's
economy."
The center's report urges the de Blasio administration to focus more of the programs run by the NYC
Department of Small Business Services on helping existing firms scale up. Many current programs encourage
the launching of startups, the report notes. Entrepreneurs say access to funding, in particular, is critical to
growth.
Deb Windsor, who is profiled in the report, founded ConstructionKids, an education workshop in Brooklyn, in
2008. What helped her expand to 60 people during the peak summer months and hit $1 million in annual
revenue was receiving two grants—one for $25,000 and a more recent one for $100,000—through the city's
Economic Development Corp. She has used the first cash infusion to formalize her training program and invest
in technology.
"It was just a fantastic way to help a small business jump-start itself," Ms. Windsor said.
A version of this article appears in the November 17, 2014, print issue of Crain's New York Business.
Blackstone to sell 1095 Sixth Ave. for $2.25B
Related News
Voters give high marks to mayor's pot plan
Businesses step up holiday social-media game
Immigrant-owned firms fight to stay put
Startups aim to ease immigration hassles
Business Lists
Top 150 Private Companies
Top 25 NYC Commercial Property Managers
Crain's 2014 Growing a Business Guide
Top 15 New York-Area Foundations
Fast 50](data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7)