Midland’s can-do spirit ranks it high for young entrepreneurs
The can-do spirit that helped build the Tall City and build the nation’s premier oil- and natural-gas-producing province remains alive and well in 2016.
Small Business Trends, an online publication for small business owners, entrepreneurs and the people who interact with them, has listed Midland among the top 10 cities for young entrepreneurs. Midland is ranked alongside Austin-Round Rock; San Francisco-Oakland-Hayward; Salt Lake City; Denver-Aurora-Lakewood, Colorado; Minneapolis-St. Paul-Bloomington, Minnesota and Wisconsin; Seattle-Tacoma-Bellevue, Washington; Madison, Wisconsin; Boston-Cambridge-Newton, Massachusetts and New Hampshire; and Fargo, North Dakota.
Small Business Trends cited Midland’s rate of 2.9 small businesses per 100 residents. “And with 16.9 percent of the city’s population falling between 25 and 34, it has a community full of young professionals, which could offer young entrepreneurs plenty of collaboration and partnership opportunities,” the publication said.
The influx of young professionals brought in to work in the booming oil and gas industry gave rise in 2006 to the Young Professionals of Midland, a program of the Midland Chamber of Commerce.
“I feel that YPM members, who are aged 21 to 40, are indeed more entrepreneurial, resilient, and driven to succeed,” Roger Kienast, the organization’s 2016 chairman, said in an email. “I know many who have survived multiple rounds of layoffs during this downturn. I also know many who were let go and who then went on to get new jobs. They are determined to continue living and searching for work in the Midland community, and not necessarily in the oil business. We have lives here and there’s more to the community than having an oil job. Quite simply, we don’t pout and give up.
“I would say there’s a wide variety of talent; people who have started their own business and lived here their whole lives, and those who moved to the area for new opportunities. Whether you’re from Midland or not, there’s plenty of skilled young professionals. Midland has a great supply of smart and talented professionals, and I am lucky enough to call many of them my friends.”
The professionals who came with the oil boom have been prompted by the downturn to turn to entrepreneurship to support themselves and their families.
“Since I’ve been director about 6 1/2 years, we’ve always had a goal for business start-ups and this is the first time in the nearly seven years I’ve been there we’ve hit that goal,” said Enrique Romero, director of the Small Business Development Center at the University of Texas of the Permian Basin.
“We’ve never been this busy,” he said.
Of six affiliated small business centers ranging from Amarillo to Abilene to Wichita Falls, the UTPB center is one of the busiest as clients seek to diversify, Romero said.
He said the center has worked with clients interested in starting retail, industrial and construction-related businesses.
“People that were involved in oil and gas, that left a bad taste in their mouths,” he said. “They weren’t prepared, or this is the first time they experienced this cycle and they want to try different industries.”
The center’s challenge is to help them set up businesses and find start-up capital, which he said is increasingly difficult right now.
Claudia Lardizabal agrees that younger entrepreneurs are challenged in finding start-up capital. For one thing, they don’t have an extensive credit history and they’re paying off student loan debt.
“Unless you have family or other parties as investors, or severance packages or retirement like military retirement, that’s a challenge,” she said. “It’s not impossible; it’s just a little trickier.”
Lardizabal is a consultant with FranNet, which matches individuals with franchise ownership opportunities. She has been working with the SBDC for several yeas and said Midlanders “absolutely” have an entrepreneurial spirit.
They’re seeing upper management downsized after just a couple of years, she said.
“If it’s like that at the top, they can imagine what it’s like for the lower ranks,” she said in a phone interview from her El Paso office.
She said she has seen the trend morph from those in their 40s seeing entrepreneurship as a second retirement option to those in their 20s and 30s “with a little money looking for an investment. Some are finding they want to take control of their destiny. I find millenials don’t view authority the same way. They’d rather do it on their own; they’re more independent.”
Lardizabal has also observed differences between those she works with in Midland and those she works with in El Paso.
In El Paso, they’re interested in the latest club or entertainment trends; in Midland, they’re more interested in service-oriented businesses, she said.
Jan-Pro International, which offers cleaning techniques and systems with a focus on offices and commercial and health care facilities, finds West Texas a great business climate for its concept, said Scott Thompson, vice president of franchise development.
The Alpharetta, Georgia-based company has 137 regional master franchises and is looking to establish one in Midland.
“I’ve been here recruiting. That big blue sky is amazing,” Thompson said in a phone interview.
He cited the number of small businesses opening in the region amid the oil boom.
“Our target is 50,000 square feet or less and we specialize in medical facilities, dealerships, banks, churches. Commercial cleaning may not be sexy, but once you dig into our model, you get excited,” he said.
The younger generation of franchise owners will be able to leverage their social media marketing tools to generate more business leads, he said.
“For millenials, yes it’s cleaning, but it’s also business ownership,” he said.
The company has had interest locally, Thompson said. “It takes time. They have to be a good fit.”
Matt Kelton, chief operating officer at Showhomes, likes the size of the Midland market. “You can go into it and dominate as opposed to a market like Dallas or Chicago. A market like Midland would be good -- there are more people moving in. You see millenials moving back (to their hometowns) after a few years in the big city.
The Showhomes franchise system works with Realtors and homeowners to transform high-end vacant houses into fully furnished, inviting, valued Showhomes homes. Kelton said that having recently acquired the system, he can sell franchises only in the Houston area. The previous owner has rights to the rest of Texas.
But he said he likes that Midland has both affordable and high-end housing.