(Editor’s note: This post was updated at 10:30 a.m. on September 10. The original post contained inaccurate information regarding a potential Ton Brothers restaurant in the Waterside at Riverpark Place development on River Road.)
Welcome to the September 10 top secret, always confidential Monday Business Briefing.
These are biz tips Insider Louisville staff and contributors have collected during the past few days, a few of which are NOT double-verified like Insider Louisville’s daily reporting.
But as always, this is information from insider sources with direct knowledge of events.
Think the revolution in crowdfunding Kickstarter has created is cool? You ain’t seen nothing yet!
• This is where Monday Business Briefing typically has its first scoop or lead on a new business … or coming crisis at some hospital group. Today, we have something completely different. In our August conversations with Ted Smith, Mayor Greg Fischer’s Economic Development and Innovation director, Smith brought up the topic how the Jumpstart Our Business Startups Act, or JOBS Act, signed last April, will soon bring a new source of serious business financing. In essence, small businesses will be able to “go public” (on a limited scale) without the huge costs of complying with securities regulations now. Smith’s take: Louisville needs to create a coordinated effort to make certain its most promising visionaries at early-stage companies are the first to join this revolution. “What if we were first to have our stuff together on private equity?” he said.
Without the mainstream media much noticing, a JOBS Act provision allowing companies to offer shares online finally cleared several regulatory hurdles on Aug. 30. Theoretically, as soon as mid-February 2013, companies designated as “emerging growth companies” could be cleared to advertise equity stakes to accredited investors, leaving behind the whole time-worn friends and family investing of funding a start-up. (EGRs are defined as companies having less than $1 billion in annual revenue, which obviously is the huge majority of private enterprises.) Think Kicksarter, but with stock issues to accredited investors (also known as “high net-worth individuals” under Regulation D of Securities and Exchange Commission rules). We will have a full post later this week as we talk with venture capitalists and entrepreneurs, because there are still a lot of unknowns. Such as, will Kickstarter-style portals be allowed to issue securities, not just aggregate donations from ordinary people extending few bucks to help people with good ideas? We’ve spent the last two years raising money, so we know this is a hot topic for every entrepreneur and financier in this town.
• Speaking of people who know how to raise money, restaurateurs Michael Ton and Steven Ton have had the most incredible run of anyone in Louisville during the past five years. The brothers started in 2007 with Basa on Frankfort Avenue. Then they added Doc Crow’s Southern Smokehouse & Raw Bar last year on Main Street, a block east of KFC Yum! Center. Back in April, they opened La Coop Bistro in the Green Building in NuLu. Now, our sources tell us the Tons might be headed to Steve Poe’s Waterside at Riverpark Place development along River Road just east of downtown in a partnership. We heard originally from multiple sources that a deal was done. Not so, said Brett Davis, the Tons’ partner in Doc Crow’s and La Coop. “We’ve met with them twice, but walked away from the table both times without a resolution,” Davis said, adding the restaurant partners are still interested. One caveat – Poe’s been building this project for a decade under various names. But it appears he sold that island in Belize or something, and work is progressing quickly both at the marina and at the 170-unit apartment buildings complex. The move might put the Tons and Davis up against former Jack Fry’s owner Susan Seiler, who’s opening Relish Cafe at 1346 River Rd., which is in the strip center just west of the Poe project.
• Monday Biz Briefing is hearing more chatter about the possible revival of plans to bring a big-box retailer to Broadway in the area around 18th Street. Before the Great Recession, Walmart and Target considered the site – part of the abandoned Philip Morris USA property – dating back to 2005. The Mardrian Group is the last owner of record we could find. You’re rolling your eyes, but here’s why retailers may be taking a second look. If you never leave the suburbs, you don’t know that Broadway from 18th Street to 26th Street is booming. At least in relative terms. During the last 10 years, the amount of retail has increased. The YMCA and the University of Louisville have proposed a 50,000 square foot facility on the southwest corner of 18th and Broadway where an abandoned Philip Morris USA warehouse is now. Where that project stands is anyone’s guess since U of L seems to have lost interest. The former Philip Morris property is a few hundred yards north of the global headquarters of Brown-Forman Corp., the Louisville-based liquor giant. We’ve gotten contradictory stories on which big retailer is interested. More when we get more on this ….
• Well, we guess we have the answer to our rhetorical question last week about what Republic Bank & Trust Co. does to replace its now-banned tax refund anticipation loan business … it turns into JP Morgan Chase, with banks all across the United States. Well, maybe. On Friday, Republic executives put another failed bank in their shopping cart, taking over a tiny failed bank in Minneapolis with the help of the Federal Deposit Insurance Corp. Republic now has First Commercial Bank in the toney suburb of Bloomington, or more importantly, its Minnesota charter. The deal comes nine months after Republic – again under the aegis of the FDIC – took over Tennessee Commerce Bank in the toney Nashville suburb of Franklin, Tenn., where all the country music stars live. Beginning to see a pattern? Republic has been chartered in Florida since 2006, where the bank now has at least five banking centers. So, as of Friday, Republic now has operations from Florida to Minnesota. Is Steve Trager building a regional/national bank? Only time will tell.
• This is very exciting … lots of freebies coming to Louisville via SpotOn, a new San Raphael, Calif.-based company that helps small businesses create customer loyalty programs. Louisville is part of a national roll-out that already includes 1,000 locations. SpotOn uses an app to allow customers to check in rather than record purchases on loyalty cards. We hear Home Run Burgers will offer freebies this Friday as part of the Louisville launch.
• The Lexington Herald-Leader reported last week that KentuckyOne Health, part of Denver-based Catholic Health Initiatives, laid off 40 employees at St. Joseph Hospital and St. Joseph Hospital East locations in Lexington. The Herald-Leader report came about two weeks after Monday Business Briefing had this:
Speaking of CHI, the purge of Jewish Hospital & St. Mary’s HealthCare employees continues eight months after CHI took full control of JHSMH. We understand the chief compliance officer and vice president, Ambulatory Care will be the only JHSMH executives to stay. This is after Morning Biz Briefing broke the story last March that CHI eliminated JHSMH’s legal department. Sources say all JHSMH employees now have to reapply for their jobs!
We hear now that KentuckyOne has laid off about five percent of its Lexington workforce, a workforce that totaled 3,500 people at the beginning of 2012. We also hear the Louisville operation is about to see far larger cuts beginning as early as this week. The cuts come as KentuckyOne, which was created last January as CHI gobbled up the remnants of Jewish Hospital & St. Mary’s HealthCare it didn’t already own, expands statewide from its urban-centric mission. This is from KentuckyOne’s just release strategic plan:
Grow statewide, creating the standard of care and quality in the region.
We will increase our level of influence statewide through relationships, assets and capabilities. As we expand across the state into areas not currently served, KentuckyOne will focus on providing the highest levels of quality and patient safety, consistent with our commitment to being harm-free by 2020.
That harm-free part is good to hear coming from a hospital. But we hear it’s code for ending all the Jewish system’s reproductive and birth control services, as well as living wills.
• Digital advertising insiders tell Monday Business Briefing that Coca-Cola very quietly recruited about 200 local tech talents and branding people – some right out of college – on the way to building a Louisville-based marketing center.
• We told you back in April that advertising/marketing firm The Vimarc Group was moving to The Pointe in Butchertown from the far ‘burbs in the Blankenbaker Parkway area. We got a note this week the move is complete, and we’ve dropped off donuts at the new space, which we have to say is glossy, groovy urban.