Small business playing crucial role in aerospace, defense industries - East Valley Tribune: Business

Small business playing crucial role in aerospace, defense industries

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Posted: Sunday, October 21, 2012 7:47 am | Updated: 9:57 am, Tue Oct 23, 2012.

While the big businesses in aerospace and defense like Honeywell and Boeing get a lot of the headlines, small companies form the East Valley’s backbone and growing business in the sector.

“We don’t tout how advanced and robust our industry is here,” said Dan Nienhauser, managing director at Impact Business Accelerators and a partner at the Ostrom Group, which specializes in small business acceleration. “There are so many gems in the East Valley aerospace industry. The press talks about large businesses and sexy startups, but my experience is that the small businesses get overlooked.”

Business leaders from the East Valley and around the country spoke about those challenges, changes and opportunities at a small business symposium directed at those companies Wednesday at the Arizona State University Polytechnic campus.

Arizona is in a unique position to develop this sector, said Mike Hutchinson, project director at the East Valley Partnership and East Valley Aviation & Aerospace Alliance, as well as former Mesa city manager.

With the large number of airports and military installations throughout the state, there is a need for these types of businesses, he said.

“Momentum is building, I think, but sequestration could change that,” said Hutchinson.

To continue growth, businesses can focus on a few areas that will keep their business relevant in an industry that may see a number of cuts to government spending, Hutchinson said.

Instead of relying on government partnerships, companies should look at trying to use their technology in different ways, said Nienhauser.

The Rebook Pump shoe was one way that people took existing technologies and used it in a completely different method, said Gaurav Rohatgi, principle at Continuum Advanced Systems, which made the shoe to compete with Nike’s Air Jordan.

“It wasn’t that the customer said, ‘I want to jump higher,’ it was ‘I want to feel like I can jump higher,’” Rohatgi said.

So the innovation team from Continuum took a medical bladder and put it inside the show, Rohatgi said. This inflatable bladder made the inside of the shoe shape around the ankle and foot, he said.

The symposium also touched on a different form of funding, called crowdfunding.

Crowdfunding is using the Internet and social media to raise capital from a large number of people in relatively smaller amounts than traditional financing.

“Crowdfunding can bridge the gaps between startup and venture capitalism,” said Brian Burt, partner with Snell & Wilmer, a large corporate law firm with offices in Phoenix.

Often times, small companies don’t have the resources or the business to attract venture capitalists, but they need additional funds to make the next step in their growth, Burt said.

With changes made in the American Jobs Act, many regulations on crowdfunding will either be lifted or changed, Burt said. The new regulations have not gone into affect yet.

“It democratizes the funding process,” Burt said. “We know that the majority of net job growth doesn’t come from large corporations, it comes from small company growth.”

But building that job growth can be challenging without getting the right message to the right people, said Anthony Bajoras, the founder of Optimize Advertising.

“There’s this myth that if you build it, it will come,” said Bajoras about company websites.

When it comes to appropriately reaching your future customers, it’s important to diversify the way you market, Bajoras said.

“A lot of people said they tried and it didn’t work,” Bajoras said.

He recommends diversifying online advertizing to get the best results and that can mean using paid search options, unpaid search options (such as search engine optimization), display and banner ads, social media, mobile advertizing, affiliate advertizing (setting up partnerships) and email campaign.

“Email is probably one of the greatest marketing opportunities,” he said. “People say, ‘But I hate spamming people, I don’t want to do that.’ But you have to customize an appropriate message.”

That message should be a narrative that shows what you do, rather than stating your qualifications, said Dave Cooke, international speaker, author, trainer and growth expert from Scottsdale.

“Your business is like your baby,” Cooke said. “Realize that customers see people like you everyday. It’s like seeing a picture of your kid everyday. But if you can tell them, ‘My kid is really good at saving you time. I know because the largest diesel manufacturers saved time.’”

But not every type of marketing makes sense for all businesses.

“Not everybody needs to be tweeting every five seconds,” Bajoras said. “Not everyone has as much to say as (NFL football player Chad) Ochocinco.”

For more information about East Valley Aviation and Aerospace Alliance, visit www.evaaa.org. To be included in upcoming discussions similar to the symposium or for more information, email Dan Nienhauser at Dan@ImpactBusinessAccelerators.com.

For more information, visit www.impactbusinessaccelerators.com.

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