Three Small Business Owners Who Love Obama's Stimulus
Some Inc. 500|5000 CEOs are in the right industries to benefit from the President's emergency funds.
The final stimulus bill, which President Obama recently signed into law, was hurried through Congress as emergency aid for a faltering economy. But several provisions are meant to foster innovation and build up American industries as part of the recovery. Money will go to traditional infrastructure, electronic medical records, smart grid technology, and renewable energy in the hopes of creating new jobs and new technologies.
And several Inc. 500|5000 companies are well-positioned to take the lead.
Infrastructure
In the bill's most traditional investment of public money, $29 billion will go to building highways and bridges. The money will be a boon to the ailing construction industry—which, at 9 percent of the list, is the third-biggest sector on the Inc. 500|5000. Many companies, in an attempt to compensate for dwindling commercial projects, are already shifting toward public works projects, putting stimulus money within their grasp.
John Branham, CEO of Missouri-based Branco Enterprises, No. 2,843 on the Inc. 5000, estimates 60 to 75 percent of their workload this year will be civil projects—a sharp reversal from their usual commercial and residential focus.
"We would normally be doing 60 to 75 percent on the building side. That's how big a turnaround we've seen," he says.
He feels confident Branco will benefit. Missouri's state highway commission is already accepting bids for shovel-ready projects contingent on the funding passing.
Central Florida's Utility Systems Construction, No. 925 on the Inc. 5000, a sewer, water and drainage contractor, has shifted to municipal projects and roadworks to weather the downturn. According to CEO Bill Schwartz, their biggest challenge is the number of contractors in the area bidding on work, which drives profits too far down.
"The stimulus package, if used properly, if money is put in the right place, will help us on a short term basis, and there's no doubt it will create jobs," he says.
Electronic Medical Records
From finance to telecommunications, most businesses have digitized their information. Combined, IT services and software companies make up 17 percent of the Inc. 500|5000. Girish Kumar, founder and CEO of eClinicalWorks, No. 339 on the Inc. 500, thinks it's absurd medical records are any different.
"I would put digitizing medical records as one of the no-brainer investments we could make," he says.
In five years, Kumar's company has grown from 30 to 750 employees and from $1 million in revenue to $84 million in 2008, despite the economic downturn. He believes that with extra push from the government, the industry can go completely digital within five years.
He expects the $19 billion infusion of stimulus funds to create jobs, while speeding the adoption of a technology with proven appeal to consumers.
"We are trying to find ways to create good, high-paying jobs, and this is a good place to pick and say let's do it," he says.
Andy Chiranjeevi of KBTS Technologies, No. 3,161 on the Inc. 5000, another EMR provider, expects the stimulus will bring his company more business, either through working directly with agencies like Health and Human Services or because federal promotion will speed adoption.
"My hope is that it's going to force all the physicians to adopt the technology, so it becomes more usable across the community," he says. And that wave of business will mean expansion for KBTS and hiring programmers, analysts, and administrators to work on design and implementation.
Smart-Grid Technology
In August 2003, 50 million people in the United States and Canada suddenly lost power, due to a cascade of failures started by the shutdown of a single high-voltage power line. The blackout, which illustrates the rapid aging of the nation's power grid, makes a good case for the $11 billion allotted for developing "smart grid" technology.
A smart grid would merge the existing system of transmission lines, substations, and transformers with the latest in IT. According to two Inc. 500|5000 executives developing the necessary tech, bringing the grid into the information age will make it function better and more efficiently, while giving customers more control over their energy use. And without it, widespread adoption of electric cars and renewable energy are impossible.
Augusta Systems, No. 1052 on the Inc. 5000, which develops software to integrate devices like security cameras, is working with Alleghany Power on a smart gird program. CEO Dr. Patrick Esposito predicted, "This won't completely modernize the grid, but it will stimulate the initial investments."
