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Economy & Business

Startup owners discuss challenges of life in the Lou

Pete Wissinger, Whisk
David Baugher | St. Louis Beacon | 2013

This article first appeared in the St. Louis Beacon: Pete Wissinger admits he was “scared to death” when he saw a letter from the government informing him and his wife Kaylen that they had neglected to pay a special city tax on their new bakery business. They wondered how serious the problem was. Then they did the math.

They owed a dollar.

“In order to drive and park at city hall, it cost more than to pay this tax,” chuckled Wissinger. “For them to mail us two letters telling us we owed this dollar, they were almost losing money.”

Wissinger’s story was one of a number shared by a panel of four South Side small business owners who spoke on the trials and tribulations of starting up an enterprise in the Gateway City during “Let’s Talk,” a unique public forum designed to facilitate frank thoughts on the area’s startup culture and the challenges of being an entrepreneur.

The gathering is the brainchild of Square, the San Francisco-based commerce technology company co-founded by St. Louisan Jack Dorsey, who was on hand to moderate the event.

St. Louis is the first city outside of Square’s hometown to host a Let’s Talk forum, but it won’t be the last. Over the next four months, similar confabs are scheduled for Detroit, Minneapolis, Toronto, New Orleans and the Bronx.

Fueled by countless boxes of Imo’s pizza, yesterday evening’s presentation to a packed Casa Loma Ballroom focused on businesses in the emerging Cherokee district. The questions were varied, everything from provocative questions about the city’s startup environment to general queries about what it takes to be business pioneer.

“I would say for me initially, it would be foolhardiness,” laughed Scott Carey of Sump Coffee on South Jefferson. “I think anyone who starts something new, something daring, is reaching for something that’s not in their grasp. By that very fact, they are a little bit crazy.”

Jeremy Schwartz of Cherokee Street Bikes agreed.

Jeremy Schwartz, Cherokee Street Bikes
Credit David Baugher | St. Louis Beacon | 2013
Jeremy Schwartz, Cherokee Street Bikes

“Starting a business is a crazy endeavor,” he said. “It involves putting all of your eggs in one basket and taking a huge leap of faith into something you are not sure is going to work.”

Katie Miller of Scarlett Garnet Jewelry said it doesn’t happen overnight

“I don’t think it was an ‘aha’ moment of I’m going to quit my day job and sell millions of dollars in jewelry,” she noted recalling the feeling of realizing that people would pay for the products she created. “Suddenly you see that something that was just going to feed your [passion] is something that you can do for a living. That’s the fun of it. I’m putting my creative energy into this piece and someone else is taking it into their life. That part of it is really exciting.”

Wissinger said that founding Whisk, a bake shop centered on sustainable practices, was taking a huge chance. Like many who hang out a shingle, it was the Wissingers’ first real experience with storefront commerce.

“I feel like the biggest risk that I took was that my wife and I started a business when we knew nothing about business,” he said. “She worked in offices and I was a teacher. And we decided ‘Let’s open a bakery.’ It wasn’t exactly the career path we’d been on to that point.”

Still, Whisk was the only enterprise on stage that actually started with a business plan. The others were playing it more by ear.

“This is a really expensive art project,” joked Carey of his coffee shop.

Yet he and the others agreed that having a financial blueprint, while not essential, could serve a number of purposes from impressing investors to clarifying one’s own goals.

“I do think that it is something worth visualizing-- what these numbers are that you are going to have to reach,” said Miller. “You are always going to be excited about what you are doing but the numbers to make it sustainable need to be out there.”

There was also general agreement on the value of social media and the internet to growing businesses.

“It’s very easy for somebody who is small or just getting started to get out there because we have all these awesome communication devices these days that we didn’t have ten years ago,” Schwartz said.

Scott Carey, Sump Coffee
Credit David Baugher | St. Louis Beacon | 2013
Scott Carey, Sump Coffee

The evening’s deepest discussions, and biggest applause lines, came toward the end when participants discussed their frustrations with bureaucracy. Carey felt the city might focus too much on larger developments.

“If I was Wal-Mart, if I was a big box store, I’d be building a tax base but I wouldn’t be building a community,” he said. “They’d probably build me an off-ramp. They would probably connect my water lines. They would probably connect my sewer.”

“I’m not generating a lot of tax revenue. I’m sorry,” he added. “But I think we’re creating a community here and it is growing.”

Carey also told of having to go through five inspectors in a day just to get his establishment up and running. Worse, he said that there was no true one-stop-shop for potential business owners to find out upfront what they face. Instead, storefront entrepreneurs endure a lengthy series of piecemeal requirements and surprise expenses from zoning to plumbing which often pop up partway through the process with little warning.

“What I would say is we need more transparency early on so that the people who are taking the risks understand those risks, can budget for those risks and carry through those risks,” he said.

This theme was echoed by Wissinger who got a laugh from the crowd with his one dollar tax story. He compared the process of opening a business to standing in line at the Department of Motor Vehicles.

“You think you’ve got everything and you go up there and they say ‘No, you are missing this.’ Then you get that and now, you are missing this,” he said lamenting the lack of centralization within local government. “It seemed like we never talked to one person who knew the answer to more than one question.”

Miller felt the process might also be digitized and allow for innovations like online tracking.

Katie Miller, Scarlett Garnet Jewelry
Credit David Baugher | St. Louis Beacon | 2013
Katie Miller, Scarlett Garnet Jewelry

“I’m constantly surprised how all of this paperwork is actual paperwork and that a piece of paper has to make its way to another office for something to happen,” she said.

Yet officialdom’s blizzard of red tape wasn’t the only challenge for local small businesses. Miller recalled the story of a group of out-of-towners who visited her shop. The customers said they had initially asked the concierge at their downtown hotel where the city’s funky, eclectic shopping district could be found.

He told them to go to the Galleria.

“That’s horrifying,” said Miller to a mixture of groans and laughter from the audience. “They said ‘This is the street we wanted to find and we had to Google it.’”

Still, despite the challenges, all the panelists seemed happy to be in town. Schwartz commented on the low cost of living. Carey noted the city’s growing demographic of younger professionals.

Most of all, he said, it’s a town where you can build something special.

“If you throw a rock in a pond here, you can see the ripples,” Carey said. “If you throw a rock in a pond somewhere else like New York City you are not going to see anything.”

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