Clinic Can Learn from Cable, Too Health Care Giant’S Innovation Team Is Building Diverse Array of Corporate Partnerships DAN SHINGLER by CHUCK SODER [email protected]

20150223-NEWS--1-NAT-CCI-CL_-- 2/20/2015 2:57 PM Page 1

$2.00/FEBRUARY 23 - MARCH 1, 2015

STACK is bigger and better than ever, thanks to acquisitions and rapidly increasing audience — P. 5 SPECIAL REPORT: Nela Park is showing the way for lighting industry and community — Pages 13-18

A 6.5% tax on oil and gas extracted in Ohio would amount to about $3 on each barrel and about 15 cents on each mcf of gas. Clinic can learn from cable, too Health care giant’s innovation team is building diverse array of corporate partnerships DAN SHINGLER By CHUCK SODER [email protected]

Maybe the next big medical breakthrough will come from a cable company? Big companies from all sorts of industries are helping the Cleveland Clinic come up with big ideas — and turn Taxing time for oil them into products. And none of them are health care companies. In fact, one is a cable company: Last week, Cox Com- munications became the fourth major corporation to Kasich’s plan to raise burden comes at a difficult period for industry form an alliance with Cleveland Clinic Innovations, the Clinic’s business development team. By DAN SHINGLER Kasich contends that drillers in Ohio Ohio Tax Commissioner Joe Testa, a Why would the Clinic want to work with a cable com- [email protected] have received what amounts to a “free staunch proponent of increasing the pany? ride,” because Ohio’s severance taxes severance tax, conceded that the low- Cox could help the Clinic figure out how to deliver Ohio Gov. John Kasich might have are much lower than other producing price environment for oil and gas is not health care services to the home, said Brian Kolonick, run up against his toughest opponent states. helping the administration to win sup- general manager of the Clinic’s Global Healthcare Inno- yet in terms of raising the state’s sever- The governor proposes to increase port. Cutbacks at steel mills that supply vations Alliance program. After all, Cox serves roughly 6 ance tax on oil and gas, and it isn’t the the tax on oil and gas extracted in Ohio the industry, reductions in drillers’ million homes and businesses in the United States. Republican-controlled Legislature to 6.5% of the commodities’ value, up budgets and low prices at the gasoline Thus, the Clinic and Cox have formed Vivre Health, a that’s opposed to the idea philosophi- from the current flat tax of 20 cents per pump all drive home the point that joint venture company that would commercialize tech- cally. barrel of oil and 3 cents on each thou- prices are low, Testa said. nologies and services related to home health care deliv- It’s low oil and gas prices, which are sand cubic feet (mcf). At recent prices, But he said the impact on Ohio’s ery. giving the drilling industry more the 6.5% rate would amount to a tax of drillers is being overblown, largely be- Indeed, all four of the major corporations that have rhetoric and evidence of hardship to about $3 on each barrel of oil brought cause Ohio is a natural gas play for formed alliances with Cleveland Clinic Innovations bring combat the tax proposal — and which up in Ohio, and about 15 cents on each drillers, and it’s the price of oil that has different capabilities to the table. could sap the proposal’s potential rev- mcf of gas. taken the biggest hit over the last six Lubrizol is a specialty chemicals company. Parker Han- enues. The collapsing prices of the com- If Kasich gets his way, Ohio would go months. He does not think the state will nifin makes mechanical products. IBM sells hardware, modity already have caused drillers to from having the lowest severance taxes see a sharp cutback in drilling. software and technology consulting services. pull back in Ohio, and a tax increase in the United States to having a rate “A lot of it, I think, is more rhetoric However, they all see opportunity in the health care would only exacerbate the situation, that is higher than West Virginia’s rate than reality,” Testa said. “Production sector. And they can help the Clinic develop new prod- they say. of 5%, but still lower than the 7.5% rate will increase, and we were really very ucts, Kolonick said. Some would be commercialized by The governor, however, remains firm. that Texas collects. Kasich said other conservative on the production (as- the partner companies, and some would be spun off into “It’s never the right time,” Kasich shot governors just shake their heads in dis- sumptions). Our production projec- joint venture companies. back recently, when asked by a reporter belief when he tells them Ohio’s cur- tions really mirror the industry’s pretty “We can learn a lot from somebody working in a com- at a Columbus event whether it was a rent tax rate, because it’s so low. well.” pletely different space,” he said. bad time to propose a tax increase on But is now the time to try to raise the Much of the pushback against the The Clinic is working on specific projects with each of the industry. rate? See OIL, page 30 See CLINIC, page 27 08

7 ALSO INSIDE: HIGHER EDUCATION

74470 83781 women involved in STEM fields ■ Pages 19-24 by Crain Communications Inc. Vol. 36, No. 8

0 PLUS: WOMEN IN STEM STORIES ■ COLLEGE INCENTIVES ■ & MORE 20150223-NEWS--2-NAT-CCI-CL_-- 2/20/2015 12:05 PM Page 1 Small Business Matters i Want more information and resources on this week's topics, ideas and events? Go to www.cose.org/smallbizmatters. PRESENTED BY

52 TIPS FOR YOUR BUSINESS #8: Leverage Mobile Technology

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N To Route 2 & Mentor/Cleveland Northeast Ohio companies are learning a lot from biomimicry

By CHUCK SODER [email protected]

Newell Street Renaissance Parkway Zebra mussels can detect toxic al- For more gae. So maybe Avon Lake Regional 6)ZHOOPDLQWDLQHG information, contact PDQXIDFWXULQJGLVWULEXWLRQIDFLOLW\ our licensed real Water can figure out how to do it, too. estate salespersons: Turns out, fish and other under- 6)ZDUHKRXVH 6)RIÀFH Terry Coyne 216.453.3001 water life forms can perform some GRFNV ZOHYHOHUV GULYHLQGRRUV [email protected] interesting tricks with water. Given ·FOHDU ·µWR·XQGHUKRRN Kristy Hull that they’ve been submerged in it for 216.453.3055 millions if not billions of years. 0XOWLSOHFUDQHVLQEXLOGLQJ WRQV [email protected] Avon Lake Regional Water is one %XLOWLQKHDY\SRZHUVSULQNOHUHG Jeff Kennedy 216.453.3070 of a few local companies trying to DQGDPSOHSDUNLQJ [email protected] take advantage of those skills. Nine local companies aim to mas- Visit 1350 Euclid Avenue, Suite 300 TerryCoyne.com Cleveland, Ohio 44115 ter the art of stealing ideas from Mother Nature with the help of a local nonprofit called Great Lakes Bio- mimicry. Three of them — Avon Lake Re- gional Water, Parker Hannifin and Ross Incineration Services — aim to use biomimicry to come up with better ways to monitor and clean water. Attn: Manufacturers & Warehouses In some cases, they’re working together. And Lorain County Commu- ✔ Reduce Lighting Energy Cost 50% nity College✔ aims to help, too. The GETTY IMAGES college plans to create a water sensor Fish can play a role in local companies’ ability to clean water. ✔ Dramatically improved plant lighting technology✔ center on the third floor of the sensor development center it Parker Hannifin could use bio- Northeast Ohio — be they re- ✔ Fast Pay back opened✔ on its campus about a year mimicry to develop water technolo- searchers, business executives or ago. gy, but for now it’s mainly focused students — to start thinking about ✔ Turn-key lighting project Avon✔ Lake Regional Water plans on another idea: Birds can see some what they can learn from nature. to take advantage of the new lab. light rays that are invisible to hu- Through evolution, plants and ani- ✔ No interruption Like✔ the other companies working mans, so the Mayfield Heights- mals have already developed solu- with GLBio, Avon Lake Regional Wa- based motion and control technol- tions for many of the problems we ter will work with a student studying ogy company aims to come up with humans would like to solve. for a Ph.D. in biomimicry from the a similar technology that could al- Tyrrell often will point to Japan’s CALL University of Akron. low them to spot a piece of equip- bullet train. Its nose was designed to The student will be tasked with ment that isn’t working right. mimic the beak of the kingfisher, a Bob Taussig helping the utility figure out whether However, Parker could end up bird that can dive into water with- there’s anything it could learn from helping Ross develop a better way out making a splash. As a result, the ROI Energy zebra mussels, which close their to clean water. It makes sense for train is faster, quieter and uses less shells when they encounter contam- Parker, given that water touches so energy. Today! inated water, and any other creature many industrial process — and that can tell when toxic algae levels Parker products, according to Pete True believers 330-931-3905 are rising. Buca, vice president of technology www.ROI-Energy.com The utility plans to use LCCC’s wa- and innovation for Parker’s fluid Some of Northeast Ohio’s best- ter technology lab to create a sensor connectors group. known companies believe in the Serving NE Ohio that could mimic those capabilities, Among those products are valves idea: Sherwin-Williams, Goodyear according to chief utilities executive for coffee machines and water pu- and Gojo Industries, which makes Todd Danielson. Such a sensor could rification systems for boats. Purell and other skin care products, help the utility get ready for algal “Fresh water is used in so many are among the companies working blooms like the one that contaminat- things,” Buca said. “It’s not just with GLBio. ed Toledo’s drinking water last sum- drinking water.” GLBio also has raised donations mer, forcing the city to issue a drink- Parker has seen the benefits of to finance five biomimicry-related ✔ ing water✔ ban that lasted three days. biomimicry: Inspired by the skin of education programs, most of which “The economic impacts are a snake, six years ago the company are tied to local middle schools and ✔ huge,”✔ Danielson said. developed a hose lined with ceram- high schools. Ross Incineration Services might ic hexagons. It was flexible and Colleges like LCCC, the Universi- ✔ use the lab, too. The company, which much stronger than the steel pipe it ty of Akron and Baldwin Wallace The Leadership Lab is just ✔south of North Ridgeville, has was built to replace. That pipe, University have been weaving bio- ✔ identified a biological organism that which was used to transport abra- mimicry into their education pro- for Women in STEM could help✔ it come up with a new way sive materials used to make cement, grams as well. WEATHERHEAD EXECUTIVE EDUCATION to purify the water it uses in its air pol- would wear out every two weeks. Plus, GLBio is holding training ✔ 2015 PROGRAMS lution ✔control system. The new pipe has held up for six sessions designed to help the com- Lots of other companies could be years — and Parker sells them to- panies it works with learn how to in- using biomimicry to develop water day, Buca said. vent using biomimicry. technologies, too, according to Joe He’ll talk your ear off about bio- “We’ll have more … trained peo- WOMEN ENTER TECHNICAL FIELDS Sherman, director of research and mimicry if you let him. Tom Tyrrell ple in biomimicry than any other AT A STEADY PACE, BUT THEY development at Ross Incineration, a will, too. He’s best known around place in the world,” Tyrrell said. LEAVE AT TWICE THE RATE OF THEIR subsidiary of Ross Environmental town for founding American Steel & GLBio is raising money to fund its MALE COLLEAGUES. EVERYONE Services in Elyria. Wire in the 1980s, but now he’s the own organization, too. The non- LOSES IN THIS SCENARIO, BUT OUR “I think it’s a great opportunity CEO of GLBio. profit has mainly been fueled by RESEARCH REVEALS WHY SOME not only for us, but any company … The nonprofit has an ambitious volunteer work since Tyrrell started Kathleen Buse, PHD, WOMEN PERSIST AND THRIVE. that deals with water,” he said. mission: To get people all over See BIOMIMICRY, page 27 Adjunct Professor THE LEADERSHIP LAB PROVIDES TANGIBLE BENEFITS FOR WOMEN Faculty Director, Leadership Lab for Women in STEM™ IN STEM CAREERS AND THEIR Weatherhead School of Management SPONSORING ORGANIZATIONS.”

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FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 5 KeyBank is increasing investment in small biz Former Cleveland market president Lisa Oliver is leading a team that will give support to firms

By JEREMY NOBILE [email protected]

KeyBank has more big plans for small business. Key has launched a national Business Bank- ing Segment — led by former Cleveland market president Lisa Oliver — to focus on helping companies develop and expand operations, capitalizing on the sector’s growth potential and possibly drawing new clients and business opportunities. As Key’s national business banking executive, Oliver will lead a team of bankers and ad- STACK visers in supporting owners of businesses with revenues up to $10 million through Key’s nationwide branch footprint. The goal is to better equip branch managers and clients with streamlined access to advice and other resources supporting those firms both in person and through other means, like digital or tele- EVOLVES, conferencing methods. The business segment is about establishing tighter relationships and providing better services and access to help businesses grow, Oliv- er said. The segment is unique because of its focus on small business owners. Larger companies can be serviced through Key’s corporate bank, EXPANDS she said. “Business-banking size clients have very targeted needs, very little time, and they’re looking for partners who can create ease and help them find a few hours in the day to do im- It’s not ‘just a media company anymore’ after portant financial work for their companies,” Oliver said. “And most importantly, they want a pair of 2014 acquisitions bulked up offerings ideas.” Managers at Key’s roughly 1,000 branches nationwide are being trained in how to better By KEVIN KLEPS thanks to its robust stable of content, serve and advise entrepreneurs as part of the [email protected] videos and, now, mobile applications and initiative. training centers. Key, which has about $92 billion in assets, STACK is celebrating its 10th anniver- “We take pride in the fact that we’re not also is bringing on new advisers whose pur- sary, and like the goals of the thousands of just a media company anymore,” said Josh pose includes being available for questions athletes to whom it has provided training Staph, STACK’s senior vice president of and consultations with clients and branch tips over the years, it believes it’s bigger content and a former Harvard University athletes and their representatives, to a link managers on topics related to business growth and better than ever. running back. “That’s a key distinction for on STACK’s popular website that is the and the headwinds to that. Oliver said how The company, which originated in the sales and marketing team. We’re able training centers’ primary source of refer- many people Key plans to hire is not yet Cleveland and has offices in New York and to offer much more than a typical media rals. known, as the program continues through its Costa Mesa, Calif., bulked up considerably company can to a competing partner.” CEO Nick Palazzo, who founded the early stages. with its acquisitions last June of Velocity company with friend and fellow Mayfield The move reflects an investment in technol- Sports Performance, the nation’s largest High School graduate Chad Zimmerman, ogy from the infrastructure the bank itself sports performance training provider, and 43 ‘content studios’ said STACK has a “huge inventory in a lot digital developer Driven Apps. STACK’s first magazine, which was dis- of individual communities to strengthen needs to make so that access to people, data In the last year, STACK has increased its tributed to 3,000 high schools nationwide relationships with customers actually on and other resources works efficiently, to apps number of employees by 50%, from 24 to in February 2005, had LeBron James, then the ground.” and money management products for clients. 36, and its digital audience has tripled. in his second season with the Cleveland Peter Barbaresi, who retained his role as Feedback from customers helped lay the Like any media company, it has transi- Cavaliers, on the cover. The issue the president and CEO of the newly brand- foundation for the segment’s formation and tioned from relying on its print publication promised to reveal James’ “training secrets ed STACK Velocity Sports Performance direction. — in STACK’s case, a magazine that’s pub- step-by-step.” centers after the 2014 acquisition, said “Our clients like to work with local branch lished six times per year and geared to- A decade later, current and aspiring STACK’s credibility with athletes has made managers, but we also know they find real val- ward giving young athletes workout rec- professional athletes train at 43 centers in a “substantial” impact on the individually ue by having national specialists on speed ommendations from established sports 17 states that operate under the STACK operated facilities. dial,” said Dennis Devine, co-president of Key stars and trained professionals — to sup- brand. The STACK Velocity Sports Perfor- STACK added three locations last Community Bank and leader of Key’s con- plementing its income with digital ads and mance facilities have independent owners December and has about five more “in the sumer and small business lines. “Now, man- sponsorships. But STACK differentiates it- who pay the company a franchise fee. In queue,” said Barbaresi, who expects the agers can call these specialists to work through self from many of its counterparts because return, they get access to the company’s number of training centers to reach 50 by business issues to provide a local presence, it’s doing the bulk of its business digitally, many resources — from its connections to See STACK, page 26 See KEYBANK, page 30 20150223-NEWS--6-NAT-CCI-CL_-- 2/20/2015 1:56 PM Page 1

6 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015

For Sale - 15,000 SF Freestanding Bldg. Industrial / Manufacturing - Newer Construction State, feds still at odds over ‘spoils’ from river Sediment won’t be dumped into lake in 2015, but cost is an issue

By JAY MILLER [email protected]

The tug of war between the Ohio 9000 Tyler Blvd., Mentor, OH 4460 Environmental Protection Agency and the U.S. Army Corps of Engi- • 15,000 SF Facility • Zoned: M-2 Heavy Manufacturing neers over the dredging of the Cuya- • 2.28 Acres • Ample Surface Parking hoga River has been couched in • 15’ Ceiling Height • 100% Air Conditioned terms of whether the sediment taken • 1 Dock • PPN: 16-B-059-0-00-018-0 from the bottom of the river is environmentally clean enough to be • Built in 2001 • Annual Taxes: $26,467.46 dumped out in Lake Erie. But behind that environmental ar- Gregory B. West gument is a financial argument 216.861.5379 about who will pay what could be a [email protected] HannaCRE.com price tag of as much as $5 million to keep the silt out of the lake. And any delay in a final resolution could end up hampering commercial shipping and the asphalt, gravel, petroleum, salt, cement and steel industries along the river that the shippers serve. We are pleased to welcome: Since 2010, Ohio EPA and the DAN SHINGLER Corps of Engineers, along with the Roughly 200,000 cubic yards of sediment are dredged from the bottom of the Molly Z. Brown Cleveland-Cuyahoga County Port Cuyahoga River each year. Authority and other government Molly has joined McDonald Hopkins agencies and environmental groups, Nekvasil, vice president of the Lake 1,000 or more tons of cargo left at as a Member and Chair, have been trying to solve the prob- Carriers Association, which repre- the loading dock.” National Securities Practice. lem of how to handle and pay for the sents shipping companies on the It’s the Corps’ responsibility to disposal of roughly 200,000 cubic Great Lakes. keep shipping channels open, and it Molly Z. Brown yards of sediment the Corps dredges “We are always concerned about is obligated to pay for the dredging t4FDVSJUJFT up from the river bottom to keep the the Cuyahoga River,” Nekvasil said and for the most efficient, least t.FSHFSTBOEBDRVJTJUJPOT Cuyahoga River safe for navigation. in an email. costly disposal of the spoils. If the t$PSQPSBUFHPWFSOBODF The dredging deepens the depth “In recent years, vessels have rou- sediment is clean, open lake dump- t#BOLJOHSFHVMBUPSZ of the center of the river that com- tinely light loaded by a foot or more ing is the preferred way to handle it. 216.348.5737 mercial vessels use. (much more in the spring before But for more than a decade, the [email protected] Every inch is important, since dredging has undone winter’s mis- Corps agreed that the dredged every one inch of depth lost forces a chief). Depending on the vessel, 12 material, called spoil, was too ship to lighten its load, said Glen inches of lost draft translates into See RIVER, page 29

.D%POBME)PQLJOT--$ 4VQFSJPS"WF &BTU 4VJUF $MFWFMBOE 0)t Manufacturers seek stability from House Carl J. Grassi, 1SFTJEFOU Shawn M. Riley, $MFWFMBOE.BOBHJOH.FNCFS $IJDBHPt$MFWFMBOEt$PMVNCVTt%FUrPJUt.JBNJtWFTU1BMN#FBDI By RACHEL ABBEY McCAFFERTY chined Products Association in to Crain’s via email that he — and [email protected] Brecksville. most of his Democratic peers — NDEPOBMEIPQLJOTDPN “We really need some stability in would be interested in extending A tax deduction recently passed the tax code,” Free said. the small business expensing in a by the U.S. House of Representa- The members in Free’s associa- way that didn’t increase the deficit. tives would give small businesses tion are entrepreneurs, not “gam- “I cannot support a bill that looking to buy equipment a confi- blers,” he said, and they need makes large tax credits permanent dence boost, industry groups say, something they can count on. Last without paying for them—while at but it doesn’t look like manufactur- year, the deduction didn’t pass un- the same time this Republican-led ers will get the stability they’re seek- til December. It’s difficult to decide House won’t even consider an un- ing — at least in this form. what kind of equipment to invest in employment extension, or extend- The America’s Small Business when the amount available can ing key provisions of the child tax Tax Relief Act of 2015, which would change by a factor of 10 — the credit and the earned income tax create a permanent equipment tax amount available for 2015 has now credit,” Ryan said in the state- deduction of up to $500,000, was reverted to $25,000, Free said. ment. passed by the House on Feb. 13 by The House had tried to make the “I would be happy to support a a vote of 272 to 142. bonus depreciation measure per- comprehensive tax reform pack- If House Bill 636 were to be manent last year, but the Obama age—one that did not increase the passed in its current form, compa- administration came out against deficit by almost $80 billion over nies could write off eligible equip- the measure in July, saying the ap- ten years.” ment purchases or leases on their proach was never intended to be a Omar Nashashibi, founding part- taxes, and more expensive purchas- “permanent corporate giveaway,” ner of the Franklin Partnership LLP, es could be eligible for bonus de- and the bill ultimately failed to pass which represents industry associa- preciation. the Senate. tions including Northeast Ohio- U.S. Rep. Bob Gibbs, R- The administration also released based PMPA, the Precision Metal- Zanesville, was one of the local rep- a statement on Feb. 10 noting that forming Association and the resentatives who voted for the bill senior advisers would encourage National Tooling and Machining earlier this month, saying in a news the president to veto House Bill 636 Association, said in an email that he release that it gives “small business- if it made it to his desk, though it thinks the equipment expensing — es and farmers the certainty they supports creating “permanent ex- and the R&D tax credit, another re- need to innovate, expand, and panded expensing” through other cently introduced measure industry hire.” measures, making it a revenue- groups are watching — have a good Companies have had access to neutral approach by closing tax chance of making it through Con- these measures in recent years, but loopholes. gress as part of comprehensive tax proposals can take months to actu- Rep. Tim Ryan, D-Youngstown, reform. ally get passed, said Miles Free, di- was one of the legislators who did Short of that, he said he does ex- rector of industry research and not vote in support of the bill, but pect lawmakers to at least extend technology at the Precision Ma- he did say in a statement provided the provisions through 2015. 20150223-NEWS--7-NAT-CCI-CL_-- 2/20/2015 1:42 PM Page 1

Paid Advertisement Achieving a Smooth Ownership Transition

ne of the most important phases in • Partnering with a private equity/financial sponsor. This equity sponsor typically require obtaining audited financial a company’s lifecycle comes after option can be a way to keep the management team intact statements, so they can only be carried out with proper the hard work of building the business once the company is sold, and the original owner may stay on planning. Also, acting well in advance to deepen your is done — ownership transition. board with a minority stake. Private equity firms are becoming management team can benefit your company’s options For an owner, the stakes are increasingly interested in middle-market companies, but it’s and valuation when the time comes for an exit. high — and there’s only one chance important not to forget that in this type of deal, ultimate control Additionally, an ownership transition may involve a signifi- to get it right. of the business will rest with the new majority owner. cant liquidity event for the owner. A skilled adviser can help John Masters Unfortunately, succession planning is with financial planning and the tax implications that arise from Managing Director • Going public. A company makes its shares available for an often-overlooked strategic objective the cash windfall and tax considerations. Cleveland public purchase. An initial public offering (IPO) has the Bank of America of a company, says Kevin Trieber, senior “I can’t emphasize enough the importance of engaging potential to deliver more liquidity than some other strategies Merrill Lynch vice president at Bank of America the right adviser to help guide you through the process,” says but comes at a cost as public financial reporting requirements Merrill Lynch. Masters. “It’s not just an accounting or legal discussion. The are expensive and involved, and being a public company has implications are so much more.” “I’ve seen many companies put off succession planning disclosure requirements which can impact confidentiality. because it is an emotional discussion; many owners are “Understanding the strategic alternatives through the lens not prepared to consider life after their company,” says TAKING ACTION of your personal goals and objectives and the corresponding Trieber, who consults middle-market companies on Despite the wide variety of possible situations and options trade-offs should be a non-negotiable.” succession strategies for BofAML. “It takes years to build for approaching them, a couple of rules apply in every case: For more on how your Cleveland business can a successful company. The average business owner spends First, plan ahead. And second, find advisers you trust. plan for its transition, contact John Masters at 80 hours or more working on a strategic plan and six It’s important to remember that many strategies require [email protected] hours or less working on a transition plan.” a long lead time. Options such as working with a private Ownership transition is an issue that many businesses will address in the years ahead. According to the U.S. Census Bureau, nearly two-thirds of the 4 million U.S. companies are owned by baby boomers and many are looking to retire or scale back their work. “Back in 2008 when the financial crisis hit, we had quite a few clients who were considering selling,” says John Masters, Cleveland Commercial Banking managing director at BofAML. “When the market dropped and valuations followed, they found they had to retrench and work longer than planned.” The unplanned delay in transitions has led to today’s unprecedented level of mergers-and-acquisitions activity for middle-market companies, he says.

FACTORS TO CONSIDER: CONTROL, LEGACY, LIQUIDITY When the time comes for a transition and the associated liquidity event, the right approach depends on the specifics of the business and the goals and objectives of the owner. While there are many variables, considerations often center on accessing liquidity, maintaining control, and/or preserving a legacy.

Common transition routes include: • Leveraging capital. An outside financing source provides debt capital, allowing the owner to take cash out of the business and diversify the risk of their investment into other corner stone asset classes. This option can provide fast access to liquidity while allowing shareholders the ability to maintain complete economic control of the business. But lending criteria can be strict, and it’s an arrangement that comes with debt Helping you build business success on a strong service requirements. foundation of community spirit, expert analyses,

• Setting up an employee stock ownership plan (ESOP). sound advice and trust. That’s the power of a Employees buy some or all of the company’s stock from the local connection, with you year by year, wherever owner(s) through the creation of a trust. This can be a top option for preserving your legacy and rewarding your em- you want to grow. ployees while achieving liquidity on a tax-advantaged basis. It is, however, a longer-term transition and brings consider- baml.com/yourcorner ations such as ongoing administration costs and company repurchase obligations.

• Selling to a strategic buyer. A competitor or company in an adjacent industry buys the business. This type of exit often brings top dollar, as the buyer pays a premium for the synergies it expects to gain by adding the business to its operations. But this option involves giving up control, and it can create uncertainty for employees. For marketing disclaimer, visit bankofamerica.com/disclaimer. ©2015 Bank of America Corporation 02-15-0230.A 20150223-NEWS--8-NAT-CCI-CL_-- 2/20/2015 1:15 PM Page 1

8 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 Group believes opportunity is still there ‘Multimillion-dollar question’ is how to fund development along 3-mile roadway on city’s East Side By JAY MILLER Fund for Our Economic Future, In a fast-growing city in the south plenish and reuse the fund,” she little capital of their own but are [email protected] said fund research shows that 40% or west, land along a new road that said. conduits for public, philanthropic of Cleveland residents who are in connects to an interstate highway Janik was being cautious, given and private money committed to A group of civic organizations is economic distress live within two would attract major developers and the always daunting task of raising civic improvement. working behind the scenes to make miles of the roadway’s route. willing bankers money. But an effort to answer her The CDCs would assemble and good on the moniker given to the “As we look at this, this as a once But the nature of the area around question is underway, led by the Fu- clean up properties, resell them to extension of Ohio Route 1 on Cleve- in a generation opportunity to real- the new road and the untested de- ture Fund, Cleveland Neighbor- developers or business users and land’s East Side — the Opportunity ly work on a large canvas to do revi- mand for its real estate will require hood Partners and the Greater then repay their loans from the Corridor. talization,” Whitehead said. the community to assemble a pool Cleveland Partnership. fund. They’re building the foundation “We’re interested in working of risk capital to provide the first Those groups are working with This structure has been used suc- for a revolving loan fund of as much with the (community development dollars of investment to communi- four East Side community develop- cessfully to redevelop many parts of as $20 million that could be used by corporations) and others in the ty development groups that would ment corporations to map out fu- Cleveland, including Gordon neighborhood organizations to do neighborhoods to make sure the assemble land. ture development of the corridor Square on the West Side and Mid- the critical land assembly needed to Opportunity Corridor is a source of “That is the multimillion-dollar and create a revolving loan fund town Corridor on the East Side. begin the redevelopment of the un- jobs for people in those neighbor- question,” said Deb Janik, senior that would prime the pump for de- Tim Tramble, executive director productive land along the three- hoods.” vice president of the Greater Cleve- velopment. of Burten Bell, said his group, which mile roadway, now a patchwork of A 2011 real estate demand study land Partnership. Joel Ratner, president and CEO of has successfully developed residen- vacant and abandoned property, by Allegro Realty Advisors of Cleve- “I think it’s going to take the Cleveland Neighborhood Partners, tial and commercial projects along foreclosed-on homes and underuti- land estimated that over the next wherewithal of the philanthropic estimated that a fund of between Kinsman Avenue within the Oppor- lized commercial and industrial three decades, somewhere between community, the public sector, the $10 million and $20 million could tunity Corridor development foot- buildings. 125 acres and 205 acres along the private sector and the civic sector to be created. print, would be reluctant to use that Much of the land will require ex- roadway could be developed into come up with a concept of how the The money would be lent to ex- kind of loan funding, though he pensive environmental cleanup be- 1.6 million of space for light manu- funding might be secured, from isting community development would not rule it out. fore it can be ready for redevelop- facturing, distribution, offices or what partners, at what risk and corporations along the corridor that But he lauded the assistance ment. laboratories. The study estimated what appetite for risk and in a have for years worked to improve Cleveland Neighborhood Partners The goal is to rebuild some of that that level of development structure that makes the most their East Side neighborhoods — has offered in the past. Cleveland’s poorest neighborhoods would create nearly 3,400 tempo- sense for acquisition, for targeted Buckeye Shaker Square Develop- “We’re interested in Cleveland on the city’s southeast side. rary construction jobs and 2,300 investment and development that ment Corp.; Burten, Bell, Carr De- Neighborhood Partners doing all Brad Whitehead, president of the permanent jobs. can generate revenue to repay, re- velopment; Fairfax Renaissance De- they can to provide resources to development Corp.; and Slavic Village velop land along the corridor,” he Development. said. These organizations have been “Without funders having a focus active in their communities for and an interest (in our neighbor- decades. As nonprofits, they have hoods), we can’t do it.”

Crain’s 2015 program nominations Nominations are now open for all of Crain’s Cleveland Business’ 2015 for business. programs. Deadlines for each of the programs are: ■ Health Care Heroes ■ CFO of the Year Awards Nomination deadline: Feb. 27 Nomination deadline: July 10 ■ Women of Note ■ General & In-House Count on us to Nomination deadline: March 30 Counsel Awards ■ Archer Awards Nomination deadline: Aug. 21 be with you Nomination deadline: May 1 ■ Who to Watch in Manufacturing ■ Who to Watch in Technology Nomination deadline: Aug. 24 Nomination deadline: May 18 (noon) ■ Who to Watch in every step of the way with ■ Forty Under 40 Marketing/Creativity Nomination deadline: June 1 Nomination deadline: Oct. 26 strategies for your business ■ Crain’s 52 banking needs. Nomination deadline: June 22 For more information on how to submit your recommendations for each of The NYCB Family of Banks the programs, go to: www.crainscleveland.com/nominations. has had a proud tradition of strength, stability and service since 1859. “The New”

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FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 9

January again shows a slight job loss

By JAY MILLER service employment grew only 1%. [email protected] The ACE Report is based on payroll data from about 3,000 predomi- The Northeast Ohio economy nantly small and midsize employers continues to grow slowly, even that is gathered by The Ahola Corp., though employment ticked down- a Brecksville payroll and human ser- ward in January. vices firm. Kleinhenz’s analysis in- The latest Ahola Crain’s Employ- cludes other economic indicators in- ment (ACE) Report shows that, ad- cluding construction data and retail justed for seasonal fluctuations, the sales. seven-county Cleveland-Akron metropolitan area region lost 2,784 jobs in January, repeating a pattern the local economy has followed in recent years. That’s a decline of 0.24% in an economy with 1.16 million jobs. The fragility that the up-and- down fluctuation shows is part of the reason that Northeast Ohio hasn’t THANK YOU yet fully recovered from the Great Recession. In late January, the Met- ropolitan Policy Program of the FOR INVESTING IN SCIENCE EXCELLENCE Washington, D.C.-based Brookings Institution think tank issued its FOR THE NEXT GENERATION fourth annual Global MetroMonitor, a ranking of the economies of 300 largest metropolitan areas world- The Cleveland Museum of Natural History thanks its corporate partners, whose support allows the wide. The Cleveland and Akron met- Museum to provide award-winning education, conservation and sustainability programs, innovative ropolitan areas — which combined exhibits and globally signiﬁcant scientiﬁc research. comprise the ACE Report’s North- east Ohio region — are among the 57% of North American metros that have not yet recovered to 2007 levels. The Akron economy ranked 198th, while the Cleveland economy ranked 258th. The Brookings analysis looks at both employment growth and regional income growth to come up with an economic performance index. In the past 12 months, employment in the ACE region has grown 1.31%, according to the ACE analy- CORPORATE LEADERS: sis, slightly behind the 1.5% average employment growth for the Brook- ings group of 300 global metros. “January 2015 is up 14,400 jobs from January 2014, (that’s) good news,” said Jack Kleinhenz, the Cleveland Heights economist who created the ACE Report model. “The decline is in the service sector, FOUNDATION (while) goods-producing jobs are up in January.” The drop in service jobs, Kleinhenz said, is the result of the loss of holiday 3D Communications yÕÀÃ ]V° Materion Corporation Oswald Companies jobs in the retail, hospitality and per- AISCO Metallizing Forest City Enterprises McGean USA Panzica/Gilbane Companies sonal services sector of the economy Corporation Giant Eagle Foundation Meaden & Moore Ltd. RAV Financial that distorts job counts even when Arthur J. Gallagher & Co. Hyster-Yale Materials Mitchell’s Ice Cream RPM International, Inc. economic models make seasonal ad- Anonymous (2) Handling, Inc. Nordson Corporation Sherwin-Williams justments. Kleinhenz has charted this job loss — and a compensating gain BakerHostetler Jergens, Inc. Foundation Tangent Company during the remainder of the first Calfee, Halter & Griswold, LLP Jones Day Oatey SCS Trans Medics, Inc. quarter — since at least 2012. Cleveland Clinic Foundation KPMG, LLP Ohio CAT Ulmer & Berne LLP Broken down, the regional econo- Collection Auto Group The K Company Ohio Lottery Commission WillowWood my lost 4,909 service jobs but gained Dollar Bank Leimkuehler, Inc. Oliver Printing 2,124 jobs in the goods-producing, Ernst & Young, LLP Margaret Wong & Associates, Osborn Engineering or manufacturing, sectors in the last Co. L.P.A. 12 months. Year over year, however, the region added 4,867 manufacturing jobs and 9,538 service jobs. Though JOIN US. BECOME A CORPORATE PARTNER TODAY. manufacturing accounts for only 18.8% of regional employment, it has Contact Holly S. Morgan, Director of Corporate Partnerships at provided 33.8% of the year-over-year job growth, according to the ACE (216) 231-2138 or visit www.cmnh.org/corporate-partners. employment data using seasonally adjusted data. That’s in line with the Brookings analysis, which found that regional economies around the world specializing in manufacturing have seen some of the strongest growth. Among its 300 metros, manufacturing employment grew 2.2%, while 20150223-NEWS--10-NAT-CCI-CL_-- 2/19/2015 4:02 PM Page 1

10 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015

PUBLISHER: John Campanelli ([email protected]) EDITOR: Elizabeth McIntyre ([email protected]) MANAGING EDITOR: Scott Suttell ([email protected]) OPINION Right time Gov. John Kasich is at it again, trying to increase the state’s severance tax on oil and gas producers. Here’s hoping he’s successful this time. The Ohio Legislature has rebuffed Kasich’s previous efforts to boost the drilling tax. Now, in his latest two-year budget plan, the governor is putting a new number before state lawmakers. He’s proposing an increase of the severance tax to 6.5% of a driller’s gross receipts, which primarily would be collected on natural gas sales. The tax would apply to the FROM THE PUBLISHER horizontal drilling method known as hydraulic fracturing, or fracking. The rate for conventional drilling would remain the same. City needs to be better biz partner We’ve long advocated an increase in Ohio’s ridicu- lously low, volume-based tax on oil-and-gas extrac- There’s a great story unfolding on have been calling Brauser, urging him seek a $5 million to $10 million round the 31st floor of 200 Public Square. to relocate the business. of funding later this year. tion. After holding steady for more than four years at At a clip of about eight new employ- “What they offer is, ‘Hey, come to Yet Arizona is offering to do all of it. the current rate of 20 cents a barrel, it’s time for a fair ees a month, Gabriel Partners is filling town. We’ll show you around, intro- A few weeks back, we wrote an edi- increase that allows drillers to profit while compen- cubicles and adding good-paying, duce you to local government, local torial praising the Greater Cleveland sating Ohio and its citizens for the cost of extracting white-collar jobs to the downtown dis- economic development, investors in Partnership for prioritizing the support our non-renewable natural resources. Considering trict. the area,’ ” Brauser says. of business start-ups, retention and ex- The company has gone They offer to show him of- pansion. Proactive outreach to busi- how much has changed since 2010 with the from about 15 employees at fice space and leases; they nesses like Gabriel Partners needs to be development of the Utica shale play in eastern Ohio, the start of 2014 to about 100 tell him about the talent pool at the top of the plan. it is well beyond time for a hike. today. If all goes according to and the investment commu- With Brauser’s loyalty to and love of As Crain’s reporter Dan Shingler explains in this plan, by the end of 2015, nity. Cleveland, we probably don’t have to about 150 people will have “It’s kind of like, ‘Hey, worry about Gabriel Partners moving week’s issue, the proposed 6.5% tax rate would put filled the entire floor. you’re important to us. Here out of town. Ohio in the mid-range of oil-and-gas producing Gabriel Partners’ specialty are all the things that we But we certainly do have worry states. Even neighboring Pennsylvania, which is one is helping financial institu- think you need. And we’d be about the other local businesses we of few energy-producing states without some form of tions comply with anti-mon- JOHN happy to introduce you to haven’t heard of … and what happens a severance tax, is looking at a 5% tax on the value of ey-laundering regulations. the people you need to meet when their phones ring. Banks contract with Gabriel CAMPANELLI to be successful.’ ” Brauser wants to see a culture gas. Partners to examine their Brauser admits that if he change here. He wants it easier for Shingler also reports on arguments being made transactions for signs of money laun- wasn’t loyal to his hometown, he’d be younger entrepreneurs to break into within the oil and gas industry that there is no worse dering, investigate questionable activ- gone. the established business community. time to increase the severance tax, as the plummet- ity and then fill out all the necessary “I’d be out of here. Absolutely.” He wants to make it easier for entre- ing prices of gas and oil have created ripple effects of forms for the bank to file or hand to That’s because while he’s received preneurs to come together and con- federal investigators. calls and offers to help from other nect. And he wants to see an end to layoffs and cutbacks throughout the industry. “Anti-money laundering is on fire,” cities’ economic development organi- what he calls the “nihilist” negativity of That’s an easy argument to make when you are at says Gabriel Partners’ dynamic CEO zations, he hasn’t heard a peep from many in town. the down point of a cycle. However, the reality of a Chris Brauser. anyone local. He loves not only Cleveland but its commodity market is fluidity. A down price today It’s a great story — Cleveland native No local groups have asked him business advantages. He says his can easily be an up price tomorrow, as economic leads new company to break-neck what he needs or what his obstacles prime-location office space is 10 times growth — and a story you probably might be. They haven’t offered to help cheaper than it would be in New York and political factors change half a world away. And haven’t heard. with his talent needs (he trains all his City, six times cheaper than Chicago. we find it likely that drillers would somehow find a But some people have heard. own workers, many of them veterans). Educated workers are affordable. reason to argue even at the high point that it would They’re in Atlanta, Arizona and the And they haven’t offered any assis- The connectivity is great. be “no worse time” for a tax. Carolinas. Tipped off by the new lease tance with finding investors, which is a “All the pieces are here,” he says. While we agree with the governor that the tax is Gabriel Partners signed in the fall, they priority for Brauser as he prepares to “We just have to make it easier.” fair, we don’t agree with his proposal to apply much of it to lowering Ohio’s personal income taxes. As we’ve noted here, yet another cut isn’t needed. TALK ON THE WEB Residents and businesses aren’t calling for it. And it’s likely to damage our bottom line. Re: Style changes — Homeowner of Record hind this wonderful philanthropic vision for its community youth. Instead, share more of the severance tax money for the Browns There go all the neighborhoods. It’s a great addition to the Ohio with communities where the drilling occurs. — EdFromOhio Do we really think new uniforms and City/Flats district, and I look forward to Currently, Kasich’s plan calls for sending 20% of the a new logo will solve everything? Re: Expansion seeing the river and lake further utilized increased revenue to local governments in eastern — Bill Applegate at Talan Products by rowers and sailors alike. Ohio. Increase that amount so that local Re: Ohio Supreme Court Talan = classy company. It’s one of the — 194068 communities directly impacted can deal with backs fracking many bright spots in Cleveland manu- infrastructure repairs, environmental issues and Munroe Falls is dealing with conflicts facturing. — Look This is truly exciting! Thank you to the other challenges brought on by increased drilling. of interest and jurisdictional issues, as Trebilcocks and MCPc Charities for giving so generously to the future of our Revenue also should go toward further state well as the health and safety of the resi- Re: MCPc backs The Foundry city...our youth! environmental regulation of drilling. dents within its borders. This case is much bigger than it looks, in the Flats Can’t wait to see it blossom! folks. Great stuff! Cleveland should get be- — Sue 20150223-NEWS--11-NAT-CCI-CL_-- 2/19/2015 2:54 PM Page 1

FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 11

We are proud to sponsor Wine by the Falls

Saturday April 18 7 to 11 PM Chagrin Valley Country Club

Proceeds from the evening will support many local shops and work to preserve the historic Village of Chagrin Falls. SANDVICK ARCHITECTS The Foundry is scheduled to open this fall at 1831 Columbus Road in the Flats. TALK ON THE WEB (CONTINUED)

There’s a lot of tension within the it’s banned for recreational use as Coming from a group that goes For tickets, visit elkandelk.com/WinebytheFallsheFalls existing facilities between the adult well, no? downtown 6-7 days each week and rowers (masters), collegiate crews I agree that CRF is a mess and spends a few hours a day on/next to and high school teams. desperately needs paid staff. But a the Cuyahoga, we see firsthand how Just about every team has talked lot of their issues are lack of launch much Cleveland desperately needs about getting their own boathouse space and competition for re- some sort of centralized building at one point or another. Much of sources between the competitive like this. the tension stems from the pres- rowers and recreational rowers. This is a project that can institu- sure exerted by the U.S. Coast They currently are a member voting tionalize the sport of rowing and MENTAL HEALTH FIRST AID Guard and the shipping compa- organization that has been largely provide a nesting place for an orga- nies given the extremely limited volunteer driven that needs to tran- nized, professional staff that Cleve- room within the Cuyahoga itself sition to a professional org with land youth rowing clubs so desper- Get There (crews regularly interfere with paid staff. ately need. each other as well as priority com- Moving the high school teams — Cuyahoga HS Rower mercial traffic). would actually help them, in my in Time The core issue, however, is that opinion. — artem1s Re: Organizations helping the Cleveland Rowing Foundation sorely lacks seasoned leadership. Yeah, they desperately need a regional startups Do you know how to handle a mental Most established programs have a paid, professional staff. It’s a night- Crain’s Feb. 2 story, headlined, significant professional staff with mare rowing for any club out of that “Regional startup momentum is health crisis in the workplace? We can experience in the national team boathouse. providing broad path for diverse set teach you how to respond safely and system. — rustbeltlight of entrepreneurs,” is a bunch of effectively. As such, the governance of the propaganda BS. I haven’t been CRF, given its physical isolation This is incredible! helped once in my three years as an We work with you. from most of the East Coast rowing Speaking for a lot of high school entrepreneur. — matt community, tends to be seen as rowers that are currently based at Call 216-421-4131 backward by outsiders. CRF, this is seriously one of the best Re: Rite Aid’s $2B — srsly things that could happen for us youth rowers. Rowing is such a deal to buy Envision How does getting rowing banned wonderful sport and a lot of people Pharmaceutical on the Cuyahoga help either group? don’t realize how much of an im- Rite Aid can’t afford to take on If it’s banned for high schools, then pact it has on the Cleveland area. more debt. — VH

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12 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 Pressure is upping ante for smaller banks By JEREMY NOBILE compared with eight sales in 2013, it’s a very difficult time for banks in in annual costs. In terms of rev- spread out growing costs “to stay [email protected] five in 2012 and zero in 2011. That general, and community banks in enue, Coe said the Dodd-Frank fi- ahead of the game” as profits com- Ohio activity also generally mirrors particular,” said Kevin Jacques, nancial reform act has cut deeply pete with rising costs. A fiscal squeeze is helping drive a the national pace. Boynton D. Murch Chair in Finance into the bank’s mortgage lending “We were seeing increases in the proliferation of sales by communi- Community banks tend to be lo- at Baldwin Wallace University and a opportunities. costs of compliance — the money ty banks across the country, cally owned and operated, but former economist with the U.S. Not only are interest rates being we have to spend on regulations — bankers and analysts say, as non- there’s no formal definition of one. Treasury Department. “The com- kept down because of macroeco- and IT,” he said. “So we looked at interest expenses grow faster than The Federal Deposit Insurance munity banks are more dependent nomic policy, but the ability to the increases in cost … and then we revenues. Corp. historically has classified on interest rate spreads and are make high-risk loans is eliminated, looked at how we can stay one step And with financial pressures fan- them as banks with assets under $1 more sensitive to macroeconomic all of which is choking many com- ahead.” ning the flames burning into bank billion, but that’s a long-referenced conditions than larger banks.” munity banks’ lending revenue, Costly investments in IT, from margins, many smaller and midsize figure that doesn’t account for in- And while community banks will Jacques explained. cybersecurity nets to mobile app community banks are either strate- dustry growth. The Community never go away entirely, bankers and “And if the regulators would let us and alternative payment develop- gically merging away from the heat Bankers Association of Ohio con- analysts expect the trend of consol- alone, we could do even more to ment, will be stronger and even or waiting for the fire to die down. siders the threshold for assets today idations to continue as revenue help customers,” Coe said. “But we more manageable for both banks The most recent merger around at $10 billion and below, said growth lags, costs mount and valu- really are strapped to some degree.” with the merger. Northeast Ohio came last month Robert Palmer, the organization’s ations creep upward. Lorain’s Buckeye Community “We can’t survive and say we’re when Farmers National Banc president and CEO. “But those community banks Bank, which has about $161 million not going to take part in all the new Corp., the holding company for About 40 years ago, there were who choose not to sell will be in a in assets, is seeing slowly growing tech, because that’s what people Farmers National Bank of Canfield roughly 17,000 community banks in better position from a company revenue dwarfed by growing ex- want,” Witmer said. “If we want to (with about $1.175 billion in total the country, with more than 600 in standpoint in future years,” said penses. Among the various impacts, keep up with the big banks, we assets), announced a $74 million Ohio. Today, Palmer estimates there Charlie Crowley, managing director CEO Bruce Stevens noted how levels have to spend a lot of money. In- deal to acquire and merge with Na- are about 6,600 in the country, with at Boenning & Scattergood, whose of return on equity with banks in stead of being two banks spending tional Bancshares Corp., the parent 193 currently operating in Ohio. practice assists banks with M&A this area are around 8% today. Prior that money, we’re now just one.” of First National Bank of Orrville New charters are basically nonex- deals and financing. “There’s a seg- to the recession, that hovered Meanwhile, First Federal Lake- (with about $525 million in total as- istent across the country. Palmer ment of the population that wants around 15%. It’s another way prof- wood, the largest mutual bank in sets). The merger is expected to be noted the only new community to deal with highly responsive com- itability has been hindered today, Ohio with about $1.6 billion in as- completed in the second quarter of bank opened since 2010 nationwide munity banks. In markets like Stevens said, at a time when costs sets, has an active acquisitions this year. came in late 2013, with Bank of Bird- Cleveland, Akron, Columbus, there are only rising. strategy to achieve scale that helps Mark Witmer, president and in-Hand in Pennsylvania. are fewer candidates, and opportu- “And when you’re smaller, the manage the margin squeeze, said CEO of National Bancshares and Buyouts have been happening nities will be pretty good for those regulatory burden is more because president and CEO Thomas Fraser. future senior executive vice presi- since federal regulations made them who remain.” you just don’t have the assets to First Federal itself has seen non- dent and chief community banking possible decades ago, “but the alarm- Many banks are not actively en- spread it over,” Stevens said. interest expenses rise by 20 to 30 ba- officer with Farmers, said from a ing part of it is it’s accelerating at a tertaining a sale despite seeing a Neither Portage nor Buckeye sis points annually, Fraser said. profitability standpoint, the bank much faster pace now,” Palmer said. blossoming of costs outpace rev- said they’re ready to sell yet, Combined expenses for meeting didn’t need to merge to stay viable, There are other factors at play, enue growth. While often cumber- though. regulations plus investments in but doing so relieves some fiscal Palmer noted, including growing some to quantify, Palmer said meet- technology mark about $3 million to pressures while benefiting hungry valuations in bank sales and a gen- ing regulations alone is costing $4 million in annual costs. The reg- shareholders. erally aging sector of current bank community banks between $100,000 Achieving scale ulatory components make up be- executives who may sell or merge as to $1 million each annually. First National Bank’s earnings tween $500,000 to $1 million of that. Sales picking up part of strategic succession plans. Portage Community Bank CEO rose strongly by 43% in 2014 from Even at its size, Fraser said First But the financial crunch on mar- Richard Coe said the crunch from 2013 — growth that Witmer attrib- Federal “needs to be bigger to ab- According to bank M&A activity gins is where community banks are regulations is apparent. The bank, utes largely to niche lending, like sorb those costs.” tracked by SNL Financial, Ohio saw feeling the most pressure. And their which has about $330 million in as- agricultural loans — but the stock “To be able to handle the ex- 14 bank-to-bank sales in 2014, all of size makes them more susceptible sets, bumped up a compliance offi- price grew only 11% with it. pense requirements in today’s which involved sellers with assets to those strains than their more cer from part-time to full-time and Merging now, he said, will yield banking world, I think we need to around or under $1 billion. Those massive counterparts. spends more man hours on com- better returns for shareholders and be north of $2 billion in assets over figures show a clear pickup in pace “In this post-financial crisis era, pliance reviews, adding thousands achieve economies of scale that will the next few years,” Fraser said.

LEVEL OF LEADERSHIP SPOTLIGHT

MY BENESCH MY TEAM SELF TEAM ORGANIZATION SOCIETY

OUR CLIENTS HAVE SPOKEN. Benesch is proud to congratulate real estate partners Jeffrey J. Wild and Kevin D. Margolis on being named BTI Client Service All-Stars for 2015.

BTI Consulting Group provides independent research on how clients acquire, manage, and evaluate their professional service providers. Jeff and Kevin are partners in Benesch’s Real Estate Practice www.beneschlaw.com Group. We congratulate them, and the attorneys and staff who work with them, on this prestigious, client-driven honor.

The only way to become a BTI Client Service All-Star is for corporate counsel to single you out. No attorney can lobby to be added to the list, there is no self-submission process, and law ﬁrms cannot provide names of clients to be contacted. Jeff and Kevin are among only 354 attorneys across the U.S. who earned this recognition for outperforming all other attorneys in client service. 20150223-NEWS--13-NAT-CCI-CL_-- 2/19/2015 3:22 PM Page 1

FEBRUARY 23 - MARCH 1, 2015 CRAIN’S SPECIAL REPORT CRAIN’S CLEVELAND BUSINESS 13 REBECCA R. MARKOVITZ LIGHTING THE WAY FOR AN INDUSTRY AND A COMMUNITY Giving Back — P. 14 Technology — P. 16 A Rich History — P. 18

For video and more photos, visit www.crainscleveland.com/nela 20150223-NEWS--14-NAT-CCI-CL_-- 2/19/2015 3:22 PM Page 1

14 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015

WITH AN ON-CAMPUS SCHOOL AND FOR A BRIGHTER CHANDELIER IN PLAYHOUSESQUARE, GE LIGHTING’S INVESTMENTS IN THE REGION’S FUTURE ARE LEAVING A TOMORROW LASTING MARK ON THE COMMUNITY By SCOTT SUTTELL Square.” [email protected] “It’s all over the place,” Einhouse said. “It’s being tweeted, it’s on social media, it’s on the GE Lighting’s Nela Park has been a part of national news, which is what we wanted.” Northeast Ohio for more than 100 years. But There were significant technical challenges it’s the next 100 years, and the need to create on the project, Einhouse said, ranging from a highly skilled workforce for the future, that designing the chandelier to stand up to a drives one of the company’s central philan- Cleveland winter to producing light with a thropic efforts in the community. pleasing (that is, not too harsh) glow. In building No. 336 on the sprawling, leafy He said GE Lighting as a partner on the pro- (in better weather) Nela Park campus in East ject “was open to everything. They were all Cleveland is the 10th-grade location of the about wanting to make it as good as it could Cleveland Metropolitan School District’s MC2 be.” Vullo said the chandelier was “a challenge STEM school. Students at MC2 STEM attend for our technical team” but it has generated classes at campuses embedded in business lots of positive comments about the way it has and school sites around the city. In addition enhanced the look of PlayhouseSquare. to Nela Park, there are sites at the Great Lakes Science Center, the Health Careers Center and various college campuses. Community challenge GE Lighting began the partnership with the GE Lighting, with about 700 workers at Nela Cleveland school district in 2008 as part of a Park, is the largest private employer in the city corporate initiative to support education, and of East Cleveland. As such, it’s an economic in particular STEM (science, technology, engi- bulwark for the eastern suburb, which neering and math) education, said Andrea Vul- nonetheless is in severe financial straits that lo, the company’s community relations man- have city officials looking at drastic measures, ager and its MC2 STEM High School liaison. including a merger or a municipal bankruptcy. The school, she said, is helping to “educate According to the state of Ohio’s most recent and grow future innovators” — a particularly audit that covered 2012, East Cleveland “had appealing community initiative for a technol- about $5 million in debt outstanding, includ- ogy-focused company like GE Lighting. ing around $411,000 of notes and $3.2 million “STEM, and getting enough kids interested owed to a state public works program. During in STEM fields, is a challenge everywhere, so the year the city ran a deficit of $4.9 million. it was something that really resonated (with- Total revenues were about $18.2 million.” in GE Lighting),” Vullo said. East Cleveland Mayor Gary Norton laid out About 150 Nela Park employees across all some striking figures related to the city’s eco- departments devote a total of about 2,450 vol- nomic challenges. The mayor said East Cleve- unteer hours annually to students at the land’s population has fallen to less than school, she said. They offer tutoring, mentor- 18,000 in the 2010 Census from about 27,000 ing, twice-monthly lunches with students and in 2000. Only about one-third of city residents help on the MC2 STEM school’s ambitious live in a home they own, Norton said, and the sophomore project. median income is $20,500. “We tell them that we’re going to challenge Of the 18,000 residents in East Cleveland, ABOVE: CONTRIBUTED PHOTO, BELOW: REBECCA R. MARKOVITZ them with the workload, which in many cas- about 14,000 are of working age, but only es is college-level material,” Vullo said. Above, the GE Chandelier at PlayhouseSquare was unveiled in 2014 as the centerpiece of an over- 5,100 actually are employed, Norton said. Students are responding to the challenge. all outdoor renovation. Below, a Cleveland Metropolitan School District MC2 STEM school has been About 2,000 East Cleveland residents are un- Historically, Vullo said, the school’s classes housed on the Nela Park campus since 2008. employed, and about 7,000 are retirees. have ranged in size from 80 to 100 students. On top of those demographic challenges, This year’s class has 110 students, she said, Norton said, the city — like many communi- and MC2 STEM projects that classes going ties — has been hurt by the foreclosure crisis, forward will be in a range of 100-115 students. a loss of state funding and the departure or And those aren’t the only numbers that im- closing of key employers, including Huron press. Vullo said the school’s graduation rate Hospital. is 95%. Last summer, she said, GE Lighting In response to its financial problems, Norton hired its first co-op student who graduated noted that East Cleveland has cut city staff by from the MC2 STEM program; that student one-third, reduced the city budget by 25% and currently attends Cornell University. has undertaken initiatives including leasing Mark D’Alessio, manager of communica- city land to businesses and implementing tions for the U.S. Chamber of Commerce agreements with nearby communities to share Foundation’s Center for Education and Work- the cost of services such as snowplowing. force, said community-oriented companies “We’ve done a lot, but we have to take fur- like GE Lighting for years have been stepping ther steps,” Norton said. up their support — financially and through In a recent conference call meeting with con- volunteer hours — of public schools. stituents, he said those options could include a He noted that the Council of Chief State municipal bankruptcy, a merger or hikes in School Officers, a nonpartisan, nationwide, property and/or income taxes. Norton said he nonprofit organization of public officials who does not favor the tax-increase option, since head departments of elementary and sec- Cleveland area to help prepare them for STEM That’s not the case with the GE Chandelier, that would require an “astronomical” increase ondary education, in December released a re- studies — to sponsoring the FIRST Robotics the 20-foot-tall, 8,000-pound centerpiece of in rates to produce necessary revenues. port on how K-12 schools can better prepare competition. Vullo said GE Lighting each year the remaking of PlayhouseSquare. Kathy Hexter, director of the Center for Com- students for the future. Among its recommen- also chooses a major project for volunteers to The chandelier was officially turned on last munity Planning and Development at the Max- dations: “Enlist the employer community as a work and make physical improvements. May and has become a high-profile marker of ine Goodman Levin College of Urban Affairs, lead partner in defining the pathways and The 2014 project involved work at the Eu- PlayhouseSquare, which has undergone a $16 said GE Lighting, as the largest employer in a fi- skills most essential in today’s economy. Who clid YMCA, including building a gazebo and million transformation. (The dollar value of nancially distressed inner-ring suburb, “is al- has a better understanding of workforce working on landscaping and new lighting. the chandelier portion of the project was not most more like an anchor, like a hospital or a needs than employers? Frankly, it’s a no- Past projects have been at the Achievement disclosed.) university,” than a typical company. brainer that employers need to take the lead Centers for Children’s Camp Cheerful, Hiram GE Lighting sponsored the chandelier, Options for East Cleveland, she said, are on identifying the high-growth and high-skill House Camp and the Diabetes Partnership of which features 68 LED (light emitting diode) limited, as the city is small — it’s just a little jobs of tomorrow to ensure career prepara- Cleveland’s Camp Ho Mita Koda. fixtures that operate at 25 watts apiece. GE’s more than 3 square miles — and it contends tion programs are aligned to those needs.” LED lighting is used in other parts of Playhous- with heavy economic headwinds that plague The school is a major focus of GE Lighting’s many Rust Belt communities: a decline of the Brightening the Square eSquare, including digital signage, gateways community efforts, but the company also cuts and building uplighting. manufacturing base that puts subsequent a wider path in education, from supporting Corporate-driven efforts in the community Tom Einhouse, vice president for facilities downward pressures on the tax base. other STEM-related efforts — the GE Girls pro- often are under the radar, apparent only to the and capital at PlayhouseSquare, said the chan- “There just aren’t easy answers here,” she gram works with 160 sixth-graders from the company itself and to the target of the work. delier has come, in some ways, “to define the said. 20150223-NEWS--15-NAT-CCI-CL_-- 2/19/2015 4:03 PM Page 1

FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 15

LED REVOLUTION

Light-emitting diodes are changing the way GE Lighting does business and opening up new opportunities. Here, Cherian Jacob, senior global commodity leader, shows off some of the unique aspect of LEDs. For example, they can be easily molded for signage and display versus their neon counterparts. When LEDs first were developed, they were only available in color; white LEDs were created later.

BEHIND THE SCENES A walk around the sprawling Nela Park campus makes one realize there is so much more to light than meets the eye.

NOW YOU SEE IT, NOW YOU DON’T

At Nela Park’s Lighting & Electrical Institute, more than 4,000 visitors each year receive training and education on subjects ranging from display lighting to new technologies. Visitors can see how various lighting techniques can drastically change the appearance of colors and details, as pictured below. A retractable ceiling, showcasing overhead lighting techniques, is a highlight, as is the Edison Awards Hallway, where winners of GE’s lighting design competition are on display. Founded in 1933, GE says the institute was the first facility in the world devoted solely to the teaching of lighting.

PHOTOS BY REBECCA R. MARKOVITZ COOL SCHOOL The MC2 STEM High School, a Cleveland Metropolitan School District program, opened in 2008 on the Nela Park campus. It offers open enrollment and a year- round calendar, with more than 100 10th-graders currently attending at the site. Students participate in project-based learning and have access to employee volunteers as well as technology, such as the first high school MIT Fab Lab. 20150223-NEWS--16-NAT-CCI-CL_-- 2/19/2015 3:34 PM Page 1

16 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 THE EVOLUTION OF INV LED technology is forcing GE Lighting to change its ways and tra

By CHUCK SODER [email protected]

It might be 20 years before Randy Reid is forced to replace a light in his house. That’s because he’s replaced all of his light bulbs with LEDs. And they are expected to last a really long time. That’s good for Reid, a lighting industry insider who runs EdisonReport.net. But it could be bad for GE Light- ing. GE Lighting executives say they understand the challenge the company will face as people throw out the bulbs that Thomas Edison invented 130 years ago and replace them with light-emitting diodes – which are semiconductors that emit light. In response, GE Lighting is trying to transform itself into a business that can make money in a world where lights rarely need to be replaced. How might they do that? By taking advantage of the many things you can do with LEDs — and the com- puter chips that house them. And GE Lighting isn’t just talking about selling lights you can control with a smart phone. The company wants its lights to wake you up in the morning and lull you to sleep at night. It wants them to guide you to a parking spot near your office and send you coupons when you visit the store. And that’s “just scratching the surface,” according to John Strainic, general manager for GE Lighting’s North America Consumer Lighting group. “Anything and everything is possible,” Strainic said. At left, vintage GE products like these Christmas lights are on display in the museum at Nela Park. At right, GE Lighting was part of the effort to crea From streetlights to sleep The cameras also could be used to identify open “The Lean Startup.” The book encourages companies has pushed GE Lighting The East Cleveland-based unit of General Electric parking spaces, monitor traffic or figure out which to get customer feedback constantly while developing with ideas, how it designs has implemented new processes designed to help it roads still need to be plowed during a snow storm, ac- new products, which can help them change direction ture them and how it sel churn out innovative products. Products designed to cording to Freeman, who heads up GE Lighting’s effort early, before they spend a bunch of money going the who leads GE Lighting’s p push customers to replace lights that still work just to develop intelligent lighting systems. wrong way. ness in the United States fine. Products that in some cases could give GE Light- And why stop there? Eventually, GE Lighting could The FastWorks process is helping GE Lighting oper- “We’re transforming ou ing a way to make money by selling software and ser- add sensors that monitor the weather — or the level of ate more like a startup, according to Tom Boyle, chief vices. pollution in the air. Or maybe speakers, for playing innovation manager for consumer lighting. He noted So will those products generate enough new revenue music or broadcasting emergency warnings. that the Align bulbs didn’t get developed under GE Not just light bulbs any to make up for the lack of people replacing burned out “This is more valuable real estate than just lighting Lighting’s old system because it was focused on met- Reid, editor of EdisonR light bulbs? control,” Freeman said. rics like light output and energy efficiency. The Align a little bit of catch up w Reid thinks “it will be very difficult,” especially in the On the consumer side, GE Lighting also just released bulbs didn’t fit that mold. Philips had already releas consumer market. Most people aren’t lighting fanatics two new LEDs: One that emits an amber light designed “Ideas like this got lost,” Boyle said. ucts, which can be tuned like him. It’s hard to get them to replace a light that still to help you fall asleep at night, and one that is much GE Lighting decided to develop the bulbs because He’s more excited abou works, even with new features. brighter and whiter, to help you wake up in the morning. customers said they like the idea. And then they said ing is working on with a st But he’s learned not to count GE out. For now, the company is selling the two bulbs under the they liked the prototypes, said GE Lighting’s FastWorks The Boston-based comp “They’re GE, so they can handle anything. They’ll Align brand, via Amazon.com. But there are bigger op- leader, Jeff Patton. ware that allows LEDs t find a way,” he said. portunities for LEDs that can affect the way people be- “They literally said they would pull out their credit phones. The LEDs flicker One of the company’s first big inroads into the next have: GE Lighting eventually could use similar technol- card and buy that thing right now,” he said. doesn’t notice. However, generation of LED lighting is well underway, in San ogy to set the mood in classrooms, offices and hospitals. GE Lighting hasn’t just changed its processes be- smart phones can read Diego. cause of the LED revolution. It’s also put new people Morse code. There, more than 3,000 streetlights are hooked up in new roles. For instance, Boyle’s only been in his job One day, you could be to GE Lighting’s LightGrid system. Today, the city can ‘Transforming our entire business’ for two years or so. And Patton was general manager of baby food, and it could control those lights from afar. And soon a few of them The idea of using light to regulate sleep had been consumer marketing at GE Lighting until he was put in straight to your phone, Rei will be equipped with cameras as part of a pilot project. floating around at GE Lighting for years. It finally came charge of its FastWorks effort and other new projects spread quickly, with GE’s What could you do with those cameras? Well, if to life partly because of General Electric’s FastWorks about a year ago. the parent company alrea Cleveland had them, they could spot those guys who process — a company-wide innovation system de- “We’re all having to reinvent ourselves,” Patton said. “They sell so many dif are constantly double parking right outside of Rick signed with the help of Eric Ries, author of the book Jaime Irick took it a step further: The rise of the LED It’s not just light bulbs,” R Freeman’s residence in the Warehouse District.

ADVANCEMENTS IN GE LIGHTING TECHNOLOGY THROUGH T

INFORMATION PROVIDED BY GE LIGHTING. ITEMS LISTED AS “FIRSTS” WERE CONFIRMED BY THE NONPROFIT EDISON TECH CENTER. 20150223-NEWS--17-NAT-CCI-CL_-- 2/19/2015 3:36 PM Page 1

FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 17

WHO’S WHO OF NELA PARK NVENTION BETH COMSTOCK CHIEF MARKETING OFFICER, GE; PRESIDENT AND CEO, transform its business GE BUSINESS INNOVATIONS She’s not technically a GE Lighting employee, but she could be important to its future. Last year, GE Lighting started reporting to GE’s so-called Business Innovations unit. It’s not a bad place to be: The unit works with startup companies and is generally tasked with pushing General Electric in new directions. Comstock has defended the company’s commitment to GE Lighting, telling media outlets the business unit is “not for sale.”

MARYROSE SYLVESTER PRESIDENT AND CEO, GE LIGHTING Sure, she’s the chief executive at GE Lighting. But Sylvester stands out for at least one other reason: She used to be CEO of a GE business unit called Intelligent Platforms — a unit that is key to GE’s effort to connect all sorts of industrial equipment to the Internet. That experience could come in handy as GE Lighting starts connecting more of its LED products to the Internet. She has spent 27 years at GE and 14 at GE Lighting (she left for another division in 2002 and came back in 2011).

BILL LACEY REBECCA R. MARKOVITZ VICE PRESIDENT AND o create the bulbs used in the “Tribute in Light” at the World Trade Center site in New York City. CHIEF FINANCIAL OFFICER hting to change how it comes up Last year, GE Lighting began reporting to General Lacey has worked at General Electric almost as long as esigns products, how it manufac- Electric’s business innovations unit, which tries to Sylvester has, starting at GE Appliances in 1992. He’s led it sells them, according to Irick, push GE in new, high-tech directions. It’s led by GE the corporate audit staff and helped manage the finances of ng’s professional solutions busi- chief marketing officer Beth Comstock. In September, tates and Canada. she told Forbes magazine that there’s a lot of oppor- GE’s wind, energy and medical diagnostics business units. ng our entire business,” he said. tunity for GE Lighting to work with startups, and that In May, General Electric recognized his value by naming him lighting can become more of a service business. a company officer. Roughly 200 GE officials hold that title, What type of services could GE Lighting provide? s anymore meaning that they “lead large revenue-generating business- The company has already ramped up the amount of es or are in critical technology or functional roles,” accord- isonReport.net, said GE is playing help it provides to business customers that need to fig- up with its Align bulbs, because ure out how to portray their products in the best light. ing to the company. eleased its Hue line of LED prod- Irick said those customers have been asking GE Light- uned to a variety of settings. ing to provide more services related to things like lo- about a technology that GE Light- gistics, installation, maintenance and software up- JAIME IRICK th a startup called ByteLight. grades. company that has developed soft- Technology gives the company the opportunity to VICE PRESIDENT AND GENERAL MANAGER, EDs to send messages to smart do even more. For instance, maybe one day GE Light- licker so fast that the human eye ing could turn its LED streetlights into a Wi-Fi Inter- NORTH AMERICA PROFESSIONAL SOLUTIONS wever, the light sensors in today’s net network, according to Terry McGowan, a former His title means he’s head of GE Lighting’s effort to sell prod- read the flashes as if they were GE Lighting employee who is now director of engineering for the American Lighting Association. ucts to businesses in the United States and Canada. Busi- uld be in a store, grabbing some McGowan doesn’t know if the company will actual- ness customers account for 70% of GE Lighting’s revenue. ould send a coupon for diapers ly do it, but he thinks it could be another way GE Light- Before joining GE in 2003, he served in the Army for five e, Reid said. The technology could ing could make money off of all those light sockets it years, graduated from Harvard Business School, worked for GE’s help, given the relationships has access to. two tech startups as well as Goldman Sachs. Irick, who already has with retailers. “All of a sudden you’re selling it as an Internet ny different things to these stores. hotspot. People are paying for Internet service and get- joined GE Lighting’s LED business in 2010, was named a bs,” Reid said. ting lighting almost for free,” he said. company officer in September, joining Sylvester and Lacey.

THE YEARS 20150223-NEWS--18-NAT-CCI-CL_-- 2/19/2015 3:49 PM Page 1

18 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015

A WELL-PRESERVED LEGACY There are 26 buildings at the 92-acre Nela Park. Its history is just as remarkable as the technologies developed there.

HISTORY’S KEEPER

Andrea Vullo, community relations manager, has been with GE Lighting for 13 years. Her efforts for the centennial helped lead to the creation of GE’s Museum of Lighting Innovation, which is in a tiny building once used as the credit union. Nela Park, which derived its name from its National Electric Lamp Association roots, was built on a onetime vineyard known as Panorama Heights. On April 18, 1913, more than 400 employees moved operations from East 45th and Hough, transport- ing 18,000 crates and records via horse-drawn vans. The transfer was done in 19 hours. MOMENTS IN TIME At least three time capsules (and possibly four) were buried at Nela Park. The first (at right), was uncovered in 2012, and the second was opened in 2013. Findings included a lead box filled with historic papers and photos along with six Mazda lamps (one of which still works). Unfortunately, the capsule being placed in the above photo is inaccessible today. “Facilities tell me we will crush the building if we try,” Vul- lo said. And, there may or may not be a fourth capsule — building X-rays and historic docu-

mentation are inconclusive. PHOTOS BY REBECCA R. MARKOVITZ HISTORIC PHOTOS COURTESY OF GE LIGHTING

CAMP NELA

One legacy of Nela Park is that for many it was more than a place to work, with ameni- ties such as a pool, WORKS OF ART bowling alley, tennis court, barbershop and Norman Rockwell was commissioned in the 1920s to create artwork for GE rec hall. “It was like a advertisements. Seven of Rockwell’s original paintings are on display on cam- fraternity back in the pus; some of the paintings, however, were given away as retirement gifts. day,” Vullo said. 20150223-NEWS--19-NAT-CCI-CL_-- 2/19/2015 2:10 PM Page 1

FEBRUARY 23 - MARCH 1, 2015 CRAIN’S CLEVELAND BUSINESS 19 HIGHER EDUCATION WOMEN IN STEM From middle school to college, efforts to diversify the field span the education spectrum

By CHRISSY KADLECK [email protected]

The science-technology-engineering-math (STEM) needle moved an impressive 18 percentage points this past October when 160 middle school girls descended on Case Western Reserve University’s campus for the kickoff of GE Girls, a yearlong STEM awareness and engagement program for sixth-grade students from 16 schools in Northeast Ohio. The high-energy program aims to bring STEM career opportunities to life and included speakers from GE Lighting and CWRU, STEM activities with professors and confidence-building sessions with the Cleveland Play House. The efforts were rewarded with an impressive statistical change in the interest level among the young girls in attendance. Surveys done prior to the event revealed that 76.7% of the girls said they were interested in pursuing a STEM degree; after the event, that percentage soared to 94.7%. Better yet, the young survey takers unan- imously agreed girls are capable of doing well in science or math. GE Girls is just one example of the many efforts being waged by area educators, researchers, professionals and corporations along what’s known as the leaky pipeline — from K-12 to college to the workforce — to attract, encourage, engage and retain women in high-demand, high- wage STEM fields. Staring down an impending national deficit of 1 million STEM workers by 2022, according to a 2012 White House report, and a discourag- ing number of women and minorities represented in the workforce, the region is abuzz with partnerships, programs and interventions to at- tack the disparities at the middle school, high school, college and professional level.

Aiming for the middle “We know that the U.S. simply isn’t producing enough STEM workers to meet the projected future demands, and we know that it’s pretty critical to our national economy and our regional economy to be able to attract more students to these professions,” said Rob LaSalvia, chief of educational programs at NASA Glenn Research Center. “And, as we as an agency consider our future plans, going to Mars and continued research and exploration, we know that it’s important to have a pipeline of diverse future scientists and engineers and members of the technical workforce.” In its college internship program, NASA has seen 37% to 40% female participation during the last three to five years. It’s not where they want to be but it’s better than national statistics that show only 18% of all engineering bachelor degrees are earned by females, LaSalvia said. But most of the agency’s partnerships and collaborations are targeted to the middle school level or younger. “We realize to really turn students on to these field, you have to start sooner than high school starting to build that career awareness, that interest in science, that interest in math, that emphasis on the academic preparation necessary to be successful,” he said, pointing to initiatives such as its Summer of Innovation, a national program that used NASA content to promote learning among as many as 40,000 students, 45% of whom were female. Reaching younger children also has been a main outreach effort of See STEM, page 20 20150223-NEWS--20-NAT-CCI-CL_-- 2/19/2015 2:11 PM Page 1

20 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 STEM continued from page 19 are getting close to 60% of STEM degrees in Cuyahoga Community College’s Westshore undergrad yet they represent only 24% of the Campus in Westlake, said Terri Pope, presi- workforce.” dent of the STEM-focused campus. To that end, Lundeen said CWRU’s Women “What we are finding is if we don’t start in Science and Engineering Roundtable (WIS- younger in middle school, and we wait until ER) works to inspire younger girls and sup- high school, the math is not there to support port its undergraduates and graduates as they a science career and it makes STEM success transition from the classroom to the work- in college less likely,” said Pope, adding that place by connecting them with corporate Tri-C has a history of hiring women scientists partners and other female professionals in and strong women professors particularly in the field. WISER is the third largest group on biology and chemistry. campus and one of the most active and visi- ble, she said. “This is a problem that can’t be solved STEM wings to fly through one outreach activity … It’s not go- Take Beaumont School, which just ing to be enough to just ramp up the confi- opened in January its $9.5 million STEM dence of young women who are pursuing wing. The new addition has eight classrooms STEM degrees. You also have to argue for sys- that are completely focused on STEM disci- tematic, institutional changes that will enable plines such as biology, earth science, pre-en- and empower these women to be successful gineering, comparative anatomy, physics and persevere,” she said. and genetics. Kathleen Buse, faculty director of the Lead- “We know that STEM fields are lacking fe- ership Lab for Women in STEM at CWRU’s males and we want to be at the forefront of Weatherhead School of Management, makes exposing our girls to what future career they the very same argument. could have and encourage them to explore all “The research shows is that we get possibilities,” said Anna Beyerle, public rela- (women) through college, we get them with tions and marketing manager for the 327-girl engineering degrees and they drop out at private school in Cleveland Heights. twice the rate of men in corporations,” Buse “We think this type of education can make REBECCA R. MARKOVITZ said. “The companies that realize there is a fi- girls better workers, better thinkers, develop Alexandra Andrus (left) and Margaret Schiffer (right) participate in We Can Code IT at Beaumont. nancial incentive for having more women in better critical thinking skills and give the girls leadership and more women in STEM profes- a really good foundation for the future no ware development to fill the need for pro- women as still grossly underrepresented in sions are the ones that are leading the way. matter what career field they decide to go grammers. “We also have a workshop for kids the workforce in anything from welding to They are making the intentional changes to into, but it would be great to have some more 8 to 14 where you can learn engineering and engineering technology to information tech- make their workplaces more hospitable to girl power out there.” computational skills using Minecraft and nology and supply chain management,” women and how they deal with the uncon- The school’s tech club, BeauTech, recently that’s what we teach them.” Williams said. “Many of the opportunities for scious bias against women.” took a field trip to Hyland Software and is cur- Women in STEM earn 33% more than young women coming through the K-12 Corporations have an important role to rently engaged in an afterschool software women in non-STEM careers, said Ben pipeline can be accessed through career tech- play in the retention and advancement of programming program with We Can Code IT, Williams, director of special projects for the nical education up to and through associate’s women in STEM, Buse said, but the most a female-owned software education firm that National Alliance for Partnerships in Equity, degree and we still have very few women pur- powerful messages girls receive about sci- has a mission to diversify and fill the field. which is focused on helping educational in- suing those. The reasons for that are complex ence, engineering or math happens at home. “At Beaumont, we are doing HTML, CSS stitutions close the gaps that exist in the par- and varied.” “We know that parents are the biggest in- and JavaScript and we had them coding in all ticipation, persistence and completion of di- fluence on career choice for girls,” she said. “I three languages in one hour. They were so ex- verse women and under-represented men in believe that we need to spend more time ed- cited to see their code come to life,” said Mel STEM careers. Unconscious bias ucating parents about unconscious bias and McGee, CEO of We Can Code IT, which next “Many of the programs that are considered Consider this alarming statistic from Shan- how the choices they are making with their month will launch its new coding boot camp high-tech, high-wage, high-demand careers non B. Lundeen, director of the CWRU’s Flo- daughters are eliminating STEM careers and for adults to offer accelerated training in soft- are within STEM and they are areas where ra Stone Mather Center for Women: “Women a very good future for them.”

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FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 21 WOMEN IN STEM STORIES BY CHRISSY KADLECK CHAI YUET LEE LISA M. RIMPF AZLIN M. BIAGGI-LABIOSA Staring at a starry night, Chai Yuet Lee asked herself, “How During her awkward middle school years, Lisa M. Rimpf Microscopes, not baby dolls, were on Azlin M. Biaggi- could it be possible that stars can hang freely in the sky?” says she was oblivious to the concept that math and science Labiosa’s wish list when she was a little girl growing up in Watching a blinking object flying by, she wondered, “How can weren’t popular subjects for girls. Puerto Rico. a plane stay in the sky?” Riding on a plane, she asked, “How “I had a gifted and talented teacher who was amazing, and Her father was an engineer and her parents fostered her nat- can an 800,000-pound object not fall to the ground?” she never treated anyone differently so I never knew there was ural inclination and interest in science. But it was a chemistry These are the questions that initially drew Lee, a project en- any difference between boys and girls in STEM,” says Rimpf, teacher in high school whom she credits with helping her gineer at Aviation Component Solutions in Richmond Heights, 34, a research engineer at The Babcock & Wilcox Co. in Bar- make the decision to pursue a bachelor’s degree in chemistry. to pursue a degree in aerospace engineering. Born and raised berton. “Same thing in high school, I had some really great sci- She didn’t stop there. in Malaysia, Lee said she was most influenced by her father — ence and math teachers — both male and female — who are Biaggi-Labiosa earned her doctorate degree in chemical also an engineer — and her curious personality. always incredibly encouraging.” physics from the University of Puerto Rico and was immedi- “He is one of those stereotypical male engineers who would- Rimpf, a Region G Governor for the Society of Women En- ately offered a job at NASA Glenn Research Center. n’t prefer his daughter to be in the engineering field, but I gineers (SWE), went on to earn her master’s degree in chemi- Recently promoted to manager of the Nanotechnology Pro- looked up to him and the way he taught us emphasizing math cal engineering from the University of Toledo and now works ject at NASA Glenn, Biaggi-Labiosa, 37, said that females still and science,” said Lee, who earned her MBA with a concentra- on clean energy deployment for the utilities industry. receive pushback in the STEM fields. tion in finance at Case Western Reserve University after mov- She became involved with SWE, a philanthropic-profession- “Even though it’s maybe minimized right now, it’s still there. ing to Cleveland 10 years ago for her position at Aviation Com- al organization, as a freshman at the University of Toledo and You can see it and you can feel it,” she said. ponent Solutions. has stayed engaged ever since. She hopes to be elected to the “It has to do with changing the mentality of the older gen- She said being “influenced” or having a “passion” for STEM organization’s board of directors next year. eration and of some teachers; I saw it even in female teachers. fields is not enough for women to persist and achieve long- Rimpf, who grew up on the west side of Cleveland, said the We are women and we are thinkers and we’re not less than term success in male-dominated workplaces. support and encouragement she has received from fellow pro- men.” “As a female engineer you have to be a little bit more as- fessionals in SWE has been incredibly important. Not long after she joined NASA, Biaggi-Labiosa mentored a sertive from a technical perspective,” she said. That isn’t sec- “For somebody like me who is still early to mid-career, I can young woman in ninth grade who came to shadow her even ond nature for Lee, whose Asian culture expects females to very easily find a mentor or coach who is much later in her ca- though she had no interest in science. After spending three speak softly and offer their opinion only when asked. reer and traveled the path that I want to travel to give me in- weeks with her, the girl was won over by the potential of sci- Currently an active member of Women in Aviation, which sight. ence. works to encourage participation of female students in STEM, “I do the same for college students. I can tell them, ‘I got a “I changed her mind and she is pursuing her bachelor’s in Lee believes it’s incumbent upon women in the field to join D on an organic test, and it’s OK, I survived. I got my diploma chemistry right now,” said Biaggi-Labiosa proudly, adding that forces to mentor and sponsor younger girls and women. I am gainfully employed. It’s OK,’” she said, adding that her she has kept in touch with the student over the years. “No doubt consistent advancement in technical knowledge mom has always been her biggest supporter and cheerleader. “Those mentoring and shadowing programs are important and skills are fundamental to excel in STEM field; nonetheless, She believes strongly in outreach efforts and she spends a and readily available. We have to start these programs earlier. persistent strength in maintaining such high standards repre- lot of time with middle school and high school students doing I tell this to all the girls: ‘Keep going and don’t get discouraged senting minorities in STEM field for myself also includes my hands-on activities and just putting a face on her profession. because you will encounter a lot of problems but you just have support system — managers who consistently guide and lead “It makes it real; it makes it attainable having those faces — to keep going. Don’t let those things end your career. me, and academic professors who taught, mentored or people who look like your neighbors, somebody who looks like “Try your best and change the mindset of the people around coached us through their experiences,” she said. you,” she said. “It makes a difference.” you.’”

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22 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 Schools using money as graduation lure As performance stakes get higher, colleges try incentives in effort to get students to complete on time

By TIMOTHY MAGAW an academic adviser, BW promis- [email protected] AT A GLANCE es that students can graduate in four years. If they don’t, BW will Money talks, especially to cash- pick up the tab for up to one year strapped college students. And if COST OF CLEVELAND STATE’S GRADUATION INCENTIVE PLAN SINCE ITS 2013 START: for the extra time it takes students it’ll help them graduate on time, lo- to finish. cal colleges and universities are 2,893 STUDENTS RECEIVING $200 TUITION REBATE — $578,600 Students must sign an agree- more than willing to shell out the 122 STUDENTS RECEIVING $400 TUITION REBATE* — $48,800 ment saying they’ll keep their end dough. of the bargain and give the school A handful of local higher educa- 2,815 STUDENTS RECEIVING $200 TEXTBOOK CREDIT — $563,000 permission to share their grades tion institutions have pieced to- with the students’ parents. gether creative incentive programs TOTAL INVESTMENT: $1,190,400 “If students finish in four years, — some with real dollars attached *those continuing to graduate school that’s the best way to contain the in the form of rebates — that en- cost of education,” said Lisa Hen- courage students to take heavier derson, BW’s assistant provost. course loads, hopefully spurring mula may be, I think it is our goal dent, according to Craig Foltin, the encourage students to stick around “It allows students to get them- them to graduate in a reasonable and our mission to do everything college’s executive vice president of and help them budget better. selves out on the market in a time- amount of time. possible to create an infrastructure administration and finance. The Lorain County Community Col- ly way.” Colleges, of course, have always that allows students to be success- feds characterize a student carrying lege, meanwhile, announced a sim- Of course, tuition rebates, re- been in the business of graduating ful.” 12 credit hours as a full-timer, but ilar plan last spring. The college wards and guarantees are only a students, but it’s no easy task. Of- Take Cleveland State, which in he said it’s difficult for students to said it would hold steady tuition small piece of the overall comple- tentimes, students linger about for 2013 hiked tuition by 2%, but make meaningful progress on their and fee rates for students register- tion toolbox at area colleges and years without finishing their de- promised to give that money back degrees by carrying that course ing in the fall of 2014 or spring 2015 universities. Intensive advising and grees. and provide a textbook credit to load. for up to three years or until the streamlined course scheduling But over the last few years, students who completed 30 credit “We’re pushing ourselves to completion of their degree — tend to be where colleges and uni- there’s been a national push to en- hours in an academic year. So far, push students even more,” Foltin whichever comes first. versities are investing the most re- courage colleges and universities to the program cost the university said. “For community colleges, that sources when it comes to comple- do a better job of graduating stu- $1.19 million. Cuyahoga Commu- cost and affordability piece is a tion. dents. nity College appears to be following hallmark,” said Marcia Ballinger, What’s in a guarantee? If anything, the rebates, rewards In Ohio, that movement got a big suit, having recently announced a the college’s vice president of aca- and guarantees are good marketing boost when the state began tying plan to give students a reward Ohio University in Athens made demic and learner services. devices, especially in Northeast the bulk of higher ed funding to equal to 50% of tuition for each headlines earlier this year when it “We’re looking at how we can in- Ohio’s ultra-competitive higher ed colleges’ ability to graduate stu- successfully completed credit be- gained state approval to hike tu- cent completion in a more deliber- arena, according to Richard Ved- dents, rather than simply reward- yond 12 credit hours during the fall ition for incoming freshmen by ate way.” der, an Ohio University economist ing those institutions who enroll or spring semesters. 5.1% — as opposed to the state lim- Baldwin Wallace University, a and director of the Center for Col- the most students. Under Tri-C’s current tuition ited cap of 2%. But under the plan, private institution in Berea, has had lege Affordability and Productivity. “The increased attention on rates, students completing 15 cred- the university promised tuition and a guarantee program in place for “In a sense, schools are trying to completion is a healthy thing,” it hours — the minimum required fees would remain unchanged for the last few years, though it isn’t bribe students to complete on time Cleveland State president Ronald to quality for the incentive — would up to four years under the school’s locking in a price point. to increase their state appropria- Berkman said. “There was a little earn $156.81, or $52.27 per eligible so-called “Ohio Guarantee.” Assuming students meet certain tions,” Vedder said. bit of inattentiveness about the is- credit hour. The incentive is de- It was the first of the state’s four- benchmarks, such as meeting the “I think that’s a legitimate thing sue. Whether we get pressure na- signed to change the culture of year institutions to make such a appropriate credit hour require- to do. It might be viewed as a tionally or whatever the state for- what it means to be a full-time stu- move — one that was said would ments and meeting regularly with healthy development.”

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FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 23 More than résumés and job searches College career centers roll out talent development programs as more is expected from their services

By JUDY STRINGER are expected to expand on their marketing associates, human re- steering parents and students to [email protected] traditional support roles of career sources professionals, adjusters the state-run career site A CHANGE IN FOCUS advising and job placement. They and customer service representa- OhioMeansJobs.com. Today’s university-based In December, Ohio Board of Re- instead must act more like talent tives, just to name a few. The career center at the Univer- career centers are undergoing gents chancellor John Carey hand- development departments central sity of Akron’s, for example, recent- a transformation in many ways: ed college and university presi- to the university’s mission of keep- ly completed an extensive analysis Applying what you learn dents a mandate to create a better ing kids engaged, on track and ulti- of how its academic programs z Resume writing to creating plan for the functioning of their ca- mately ready for the workforce. In addition, college career of- align with a list of in-demand jobs social media and LinkedIn reer centers. “These are fairly complex goals, fices are intensifying their focus on on the website. profiles: Students today put The state board oversees higher but I think our offices are being internships and other experiential Carey said the analysis is already themselves on social media education and as costs escalate, so looked at to provide an even learning opportunities for stu- being used in one-to-one career platforms and along with that does the pressure to produce grad- broader reach and bigger impact,” dents. Mitzi Vázquez-Long, direc- counseling sessions, but will even- comes the need to understand uates who can get good jobs. said Ann Motayar, director of the tor of talent development for tually be rolled out on its website where and how to “brand” them- The chancellor is not the only career services center at Kent State Cleveland State University, said and anywhere else students and selves to prospective employers. one applying the pressure. The University. Cleveland State is creating a larger parents look for information about z Unpaid internships to experi- Obama administration is finalizing “We are still delivering many of pool of internship opportunities Akron. ential learning: Colleges now metrics for its proposed college our traditional services. … Those for its student body through “It really is a very valuable tool to offer students internships that rating system, which could include are still all important ingredients,” stronger ties with Northeast Ohio be able to look at the list of in-de- have been vetted as projects in data such as how many graduates she said. businesses. mand jobs in this region and then the workplace and can provide are employed within six months “That delivery model, however, Unlike the “pay your dues while look at the majors that prepare stu- meaningful skills and experiences and student loan repayment rates. is leaning more toward integrating making coffee for the boss and not dents for those positions,” she said. for future employment. Even college students, who used this into the overall academic pro- getting paid” internships of the Akron’s administration has tak- z Senior focused to four-year to wait until senior year to visit ca- gram.” past, Vázquez-Long said Cleveland en a strong interest in sharing the counseling: The career develop- reer offices, are seeking counseling Kent and other colleges are con- State is seeking out projects or po- information not only with students ment process is being embedded and services sooner and more of- sidering, for instance, integrating sitions aligned to a business need and parents but also faculty, since into the academic experience as ten. In fact, when prospective stu- career preparation into academic and where students can gain valu- they have more direct contact with early as freshman year. dents and parents visit campus requirements for students as early able skills and experience, typical- students than career centers do, these days, many want to know as freshman. Students might have ly while being paid. Carey said. z One-time placement to life- what the college is doing to pre- to write a résumé as part of a “We consider those to be place- The bottom line is helping stu- time job searching skills: The pare students for gainful employ- course or take a career planning as- ments in the workforce,” she said. dents understand how to assess emphasis on a single job placement or grad school and how suc- sessment. It’s a more proactive approach their talents and skills and then be ment is being replaced with a more cessful those programs are, said While there is little question than the office has taken in the able to match them with both ex- holistic approach to personal and the University of Akron’s career more students are using the career past, said Vázquez-Long since they isting and emerging employment career development and giving stu- center director Laura Carey. service department than ever, Mo- no longer sit back and wait for opportunities. dents the skills to conduct three or So frequent are the inquiries, tayar said the percentage of direct companies to come to them with “We are looking at, ‘What are four job searches over a lifetime. many universities now include ca- contact is still modest when com- job or internship openings. you learning with your degree in z Decentralized, stand-alone reer center stops during campus pared to Kent’s overall student Now the career center contacts English and how can we position department to more integrated tours. population. The university wants companies to find out what the you in the workplace?’” Vázquez- arm of university: The responsibili- “(Students and parents) proba- to take a more active role in university can do to “create a talent Long said. ty of college employability is extend- bly were always concerned about spurring students to action and pipeline” for them, she said. “That is different question than, ing beyond the walls of career cen- these issues,” said Heather Balas, making them think about employ- Some regional colleges and uni- ‘What can you do with a degree in ters to the entire university network. director of career and academic ment outcomes early on. versities also are more actively English?’” development at Hiram College, The career service office at Kent “but they are much more vocal also is working more closely with about it now.” targeted academic programs to increase student awareness of jobs in industries they might otherwise A new role ® overlook. OF TRI-C That means career centers — For example, it recently orga- once known primarily for holding nized an insurance career fair to GRADS workshops about résumés writing spotlight dozens of career opportu- and interviewing — are now tasked nities to students pursuing other with collecting and communicating fields of study. 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24 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 College Now grows through reinvention Four years after rebranding, program not only provides scholarships but guidance services, mentoring

By KIMBERLY BONVISSUTO of the corporate community and The electronic-based program be- Spangler said she and her husband, She said many College Now schol- [email protected] how we could help.” gan as a pilot in 2011 with 43 stu- also a JCU alum, often attend track arship recipients are first-genera- The organization assists more dents and mentors, and has grown and cross country meets to cheer on tion college students who don’t In 2011, Cleveland Scholarship than 23,500 students each school to 750 pairs, with a goal of 1,100 Rohwer. have the resources or people in Programs rebranded itself as Col- year and provides more than pairs in two years. their lives to turn to for advice. “It’s lege Now Greater Cleveland to bet- $2 million in scholarships annually. Winslett said College Now is one easy to forget what they don’t know ter reflect its mission of not only “The average family income of of the first programs in the country “The average family about the world.” providing scholarships, but also our scholarship recipients is just to use the online platform for col- income of our scholarship guidance and access to funds to over $30,000, while the average cost lege mentoring. She said the pro- recipients is just over prepare for and graduate from col- of the colleges they are going to is gram adapted a model used for Getting it done lege. $32,000,” Winslett said. “There is high school students. The “curricu- $30,000, while the College Now boasts a 60% college Now, four years later, it has ex- definitely a need.” lum” involves discussion prompts average cost of the completion rate by scholarship re- panded its board, added program- College Now offers advising ser- between the mentor and student at colleges they are going to cipients and states that its students ming and nearly doubled its fund- vices in schools, libraries, recre- different points throughout the col- is $32,000. There is are five times as likely to graduate ing through corporate support and ation centers, a downtown Cleve- lege career. Discussions range from from college as other low-income grants, according to chief operating land Now Resource Center and ensuring students have their books definitely a need.” college students. She said the pro- officer Alenka Winslett. other venues. While College Now’s and paid their fees to helping line – Alenka Winslett gram’s goal is to raise that statistic Today, College Now provides services are available to anyone, up summer internships. Winslett chief operating officer, to 80%. college access, navigation and re- there are programs targeted specif- said the mentoring program also College Now Greater Cleveland COO Winslett said the organiza- tention services to students and ically to low-income students, in- helps students build networks. tion awarded $1,000 scholarships to young adults at 150 locations in cluding its mentoring program, Maria Spangler, director of com- 25 graduates in five Cleveland pub- Cuyahoga, Lorain, Medina and which continues to grow each year. munity engagement for Sherwin- “It’s been really fun to add this di- lic high schools in its first year as an Summit counties. Williams, became a mentor to Re- mension to our little family — and organization, when it was called “In 2011, we had a focus on our becca Rohwer, 20, in 2013. Rohwer, she’s become a part of our family,” Cleveland Scholarship Programs. mission and expansion of our Someone to look up to a Brush High School graduate, is a Spangler said. “And it’s easy for us Since then, scholarships awarded board,” said Winslett, adding that Through its mentoring program, sophomore studying biology at to go and cheer for John Carroll.” annually have climbed to more than Lee Friedman came on board as each scholarship recipient is John Carroll University, which hap- Spangler said she was familiar $2 million. The organization has CEO. “We really looked at the needs matched with a corporate mentor. pens to be Spangler’s alma mater. with the organization through her awarded more than $62 million in company, which supports a variety scholarships since its 1967 incep- of initiatives in the Cleveland area. tion. She decided to take the leap as a “Our recent growth is primarily mentor as a way to give back. due to the partnerships with other or- “It’s really exceeded my expecta- ganizations in the community that tions,” Spangler said, adding that are working with students — high the online platform is “genius” and schools, post-secondary institutions, provides regular prompts to keep non-profits, corporations, founda- mentors and students connected tions and others,” Winslett said. and the relationship viable. “For the “We could not accomplish our most part, life just drives what the goals if we didn’t work together with conversation looks like. College stu- those entities to help students reach dents naturally have an ebb and their highest potential and move flow of schedules. That natural flow them through their educational often drives what our conversations path.” are about.” Along with corporate support se- Rohwer called the mentor rela- cured through its board of directors, tionship “positive” and said Span- College Now also was awarded two gler is a great resource. 21st Century Community Learning “I can go to her when I’m having Center grants totaling $1.2 million trouble or need someone to talk to,” in 2014 to expand its ACT prepara- Rohwer said. “I have a teammate tion program. who has the same scholarship and Last year the program also re- also has a mentor. We absolutely ceived a $1 million grant to manage love having a mentor. It’s very help- the Ohio AmeriCorps College Guide ful. I’d recommend it to anyone.” program, which uses recent college Spangler said anyone considering graduates to provide on-site college becoming a mentor should put counseling to students from low- themselves in the students’ shoes. wealth school districts across Ohio.

When you were 18, did you have all of the answers? We need 350 mentors for our next class of college freshmen. Apply to become a mentor today: www.collegenowgc.org/mentoring

50 Public Square, Suite 1800, Cleveland, OH 44113 | 216.241.5587 | www.collegenowgc.org 20150223-NEWS--25-NAT-CCI-CL_-- 2/20/2015 12:08 PM Page 1

FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 25

GOING PLACES Send information for Going Places to [email protected] UTILITY Jeff Lugar to associate vice president; Liz Schneider to treasurer; Rock JOB CHANGES FIRSTENERGY CORP.: David J. Bain to secretary; Aaron Kalizewski Karafa to vice president, distribution CONSULTING to immediate past president. support, FirstEnergy Utilities. GABRIEL PARTNERS: Frank Ewing to partner. BOARDS AWARDS FINANCE JEWELERS VIGILANCE FIRST FEDERAL LAKEWOOD: Heidi MAXIMUM ACCESSIBLE HOUSING Ewing Finniff von Zedlitz Jung COMMITTEE: David Bouffard Finniff to business development officer. OF OHIO: Scott Strawn to president; Patti Substelny to vice presi- (Signet Jewelers Ltd.) received the FIFTH THIRD PRIVATE BANK: dent; John Cotman to treasurer; 2015 Stanley Schechter Award. George von Zedlitz to senior vice Jan Hollinger Jones to secretary. president, managing director, JEWISH FEDERATION OF CLEVE- NAMI GREATER CLEVELAND: Investment Advisors Division. LAND: Andrew Zelman (Euclid Media Farah Munir, M.D. (Freee Clinic and Group) received the 2014 Bennett and HOME SAVINGS AND LOAN CO.: Recovery Resources), to chair, Donna Yanowitz Leadership Award. David Bell to relationship manager, medical advisory board. Cleveland market. KIDNEY FOUNDATION OF OHIO: NORTH COAST BUILDING INDUS- Joshua Augustine, M.D. (University TRY ASSOCIATION: Mary Felton FINANCIAL SERVICE Hospitals) received the 2015 Person (Fidelity National Title) to president; of the Year Award. Prandi Riczko Bowers Capotosto D’AMORE TATMAN GROUP LLC: Patrick J. Lysobey to staff accountant; Robert A. Sorin to director of business development. HEALTH CARE UNIVERSITY HOSPITALS ELYRIA MEDICAL CENTER: Gary Dinger, D.O., and Edward Craft, D.O., to family practice physicians. INSURANCE OSWALD COS.: Jessica Jung to director of sales, property and casualty. WESTFIELD INSURANCE: Mike Prandi to insurance operations leader; Beth Riczko to group underwriting and product leader; Rob Bowers to national claims leader. LEGAL BROUSE MCDOWELL: Nicholas P. Capotosto and Patricia A. Gajda to members, Executive Committee. MANUFACTURING RPM INTERNATIONAL INC.: Carol Baskey to manager, financial reporting; Natalie Micale to operational planning analyst. TIMKENSTEEL: Rob Feielin to director, application development and support; Nick Valentine to director, Faircrest Steel Plant; Paul Hodson, Kevin Raketich, Karen Hannum and Tim Haubenstricker to vice presidents; Larry Pollock to director, tube manufacturing. REAL ESTATE CUSHMAN & WAKEFIELD: Richard Morehouse to director, property tax. NAI DAUS: Jill Dzina to assistant vice president and senior property manager; Eytan Rosenblum to associate. SERVICE VISUAL MARKING SYSTEMS: James Weaver to vice president, sales and global markets. STAFFING DIRECT RECRUITERS INC.: Rachel Gulko to lead recruiter, plastics industry practice. TECHNOLOGY INFORCE TECHNOLOGIES: Brian Bock, Jonathan Ziernicki, Nikola Tomic and Pavel Chukhin to implementation developers. SOFTWARE CRAFTSMANSHIP GUILD: Stephanie Suchan to marketing lead. TELECOMMUNICATIONS VOX MOBILE: Alan Ackroyd to chief technology officer; Stephen Davis to regional vice president. 20150223-NEWS--26-NAT-CCI-CL_-- 2/20/2015 1:56 PM Page 1

26 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 STACK continued from page 5 Coach app provides customized fic in other ways,” Palazzo said. the last four months of 2014, in- There’s love for print, too the end of the year. workouts and in-app messaging “As we continue to grow our traf- cluding a peak of almost 24.2 mil- STACK’s key demographic, the None of the centers are in Ohio, from the 300 performance coaches fic, we really wanted more opportu- lion last October. 12- to 24-year-old athlete, does the but Barbaresi said STACK would who work at the company’s growing nities to provide other products and Zimmerman — who, along with bulk of its reading on smart phones “love” to open facilities in Cleve- list of training centers. services to them. The acquisitions Staph works in STACK’s 20-person — so much so that the company’s land, Columbus, Cincinnati and “We also see those 43 centers as were really an acceleration of that office in the Halle Building — said mobile traffic tripled in 2014. But Toledo. content studios,” Staph said. “We effort.” digital revenue is STACK’s largest the product by which the company “The uptick is pretty significant,” have hundreds of experts who can source of funds “by a significant made its initial splash is by no he said. submit content to us.” margin.” means dead. STACK magazine’s The company believes the same Palazzo, also a former Harvard Doubling down “It’s the growth engine,” the print schedule has been reduced can be said about its acquisition of football player, said prior to the ac- It’s the traffic — online and, to an company president added. from nine to 10 issues per year to Driven Apps, which produced mo- quisitions of Velocity Sports Perfor- extent, at the training facilities — The progress has been made pos- six, but its reach has widened. that is driving STACK’s bigger, sible by STACK’s monstrous video bile apps for Adrian Peterson and mance and Driven Apps, the com- The magazine — its most recent Dwyane Wade, in addition to train- pany’s only revenue streams were faster, stronger way of thinking. library — now more than 7,000 strong. issue had double covers featuring ing-oriented products. The recently advertising and sponsorships. Palazzo said the number of Houston Rockets All-Star James released STACK Performance “We wanted to monetize our traf- unique visitors to STACK’s website Staph said the Cleveland office includes four full-time video pro- Harden on one side and women’s tripled in 2014, and that followed a basketball standout Skylar Diggins nearly 10-fold jump from 2012 to ducers who do the bulk of the production of the three to six daily on the other — is distributed to ’13. 13,500 high schools and has a circu- ComScore, a Reston, Va.-based videos that STACK posts to its website each day. lation of 880,000. Because the mag- Internet analytics company, pro- azine is shared among so many vided Crain’s with 2014 data that There are videos that provide sport-specific training tips, clips young athletes, STACK said its re- showed STACK averaged nearly 7.2 that show NFL prospects working search shows there are six readers million unique visitors per month, out in preparation for the draft, fit- per copy, which would give the including a norm of almost 8.7 mil- ness segments and a heck of a lot print product a total reach of just lion from June to August — not co- more. under 5.3 million. incidentally, when many athletes Zimmerman said STACK is gen- Staph said being on the cover has are training for the start of the erating “upward of 75 to 80 million “become a badge of honor” for school year. video impressions every month.” prominent athletes, who enjoy the As impressive as those numbers Palazzo said a short-term goal is fact that STACK documents “what Do you know your lender? are, Palazzo and Staph said they to up that number to 100 million, they’re doing right.” think a more accurate reflection of Cooperative Business Services and Cardinal Community which the company CEO said will “We’re not talking to them STACK’s online popularity comes about contracts and holdouts, and Credit Union offer you bolster STACK’s efforts to monetize ORFDOÀQDQFLQJ\RXFDQWUXVW from Google Analytics because the its vast variety of videos via partner- things that affect their money,” he Jonathan Mokri • Aggressive Financing up to $10,000,000! search giant includes traffic to ships. said. “We want to talk about the • Commercial Real Estate Financing websites from users under the age Palazzo — who works in STACK’s hundreds of hours of preparation of 18. eight-employee New York office, a that went into the three-hour per- 440.526.8700 (Owner Occupied or Investment) The 2 million-plus Internet formance that everyone gets to [email protected] • group that comprises the compa- 3XUFKDVHRU5HÀQDQFHPDFKLQHU\ users whose patterns are tracked equipment or other capital assets ny’s marketing, advertising and see.” by comScore are all 18 and over, sales teams — said STACK is plan- In its next issue, STACK’s first as www.cbscuso.com • SBA 7(a) and SBA 504 loans (10% down) according to Staph, which leaves ning on doubling its revenue in the company enters its second out a sizable chunk of the compa- 2015. decade, another Cavalier will be ny’s audience. He wouldn’t provide any specific featured. Kevin Love will adorn the Staph said Google Analytics numbers, but said the ambitious cover of the March magazine. shows that the company averaged plan is based on “video growth and “It’s sort of come full circle,” about 15 million unique visitors in traffic growth.” Staph said. Providing Commercial Loan Financing in Partnership with Area Credit Unions SM

Nowacki Asset Management LLC

Nowacki Asset Growth of $1 S&P 500 Total Growth of $1 Period Management (NET) Million Return Million May 2011 - Year End -7.46% $925,400 -6.37% $936,300 2012 29.99% $1,202,927 16.00% $1,086,108 2013 51.76% $1,825,563 32.39% $1,437,898 10/31/2014 21.59% $2,219,459 10.99% $1,595,988

Note: Returns are shown in U.S. dollars after fees. Date of inception for Nowacki Asset Management is May 2nd, 2011.

Nowacki Asset Management (NAM) is a registered investment advisory firm specializing in value-oriented investment management. All client assets are included in one composite and invested using a value-oriented strategy. NAM claims compliance with the Global Investment Performance Standards (GIPS®). The S&P 500 Total Return index is subject to volatility and the NAM composite may or may not be more volatile than the index. Past performance is not aguarantee of future performance. Investments carry risks and the potential for loss. Results as of 10/31/2014 are still subject to final verification by an independent third-party. NAM only uses short-term margin or leverage to buy securities after a client commits to deposit funds and the funds are in the process of being transferred, but the money has not yet completed the transfer process. To receive a list of composite descriptions of NAM and/or a presentation that complies with the GIPS standards, contact Michael T. Nowacki at (440) 488-6936 or write Nowacki Asset Management, 29525 Chagrin Blvd. Suite 301, Pepper Pike, Ohio 44122, or [email protected]. 20150223-NEWS--27-NAT-CCI-CL_-- 2/20/2015 2:03 PM Page 1

FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 27 CLINIC BIOMIMICRY continued from page 1 lyze data from electronic medical They don’t have to be big compa- continued from page 4 point for new companies formed to the companies. The Clinic’s rela- records. Now they’re exploring other nies, he said, noting that he’s talked the organization in 2010. commercialize those technologies, tionship with Cox is new, but it always to work together, Kolonick said. to businesses of “all sorts and sizes.” When Lorain County Communi- Green said. ready has produced results: Cox in- As for Parker Hannifin, officials Cleveland Clinic Innovation isn’t ty College finishes the new water The school houses the Glide busi- vested in a Columbus-area from the Mayfield Heights compa- big on limiting who can and can’t technology lab, GLBio will move its ness incubator and a technology company called HealthSpot — ny’s hose and tubing division in join its alliance program. For exam- small office on campus into the transfer office that helps local inven- which makes a product best de- Ravenna reached out to Cleveland ple, it recently formed a partnership building. tors get to the point where they can scribed as a virtual doctor’s office — Clinic Innovations in 2007, long with a government organization, The college plans to move some either launch a business or license after the Clinic introduced the two before there was a formal alliance though Kolonick isn’t yet able to say equipment from its lab sciences their technology to someone else. companies. Clinic doctors provide program. what it is. building into the water technology Avon Lake Regional Water would care through six of HealthSpot’s Since then they’ve developed Innovations also gets a lot of calls center. be in the market for those services — walk-in kiosks, which allow people dozens of medical device proto- from other countries, he said. It al- It will buy more using part of a $2 if it can find a way to outsmart toxic to meet with a doctor via video, types together, including a few that ready works with an economic de- million state grant, which “will get us blue-green algae. If it succeeds, oth- while they’re out running errands. are completed products. velopment group called Enterprise started,” according to Tracy Green, er utilities would want to use the The partnership with Lubrizol Back in 2007, the Parker relation- Ireland, and it has had exploratory vice president of strategic and insti- technology, too, Danielson said. was announced just three weeks ship was an anomaly. Cleveland conversations with organizations in tutional development at LCCC. Avon Lake Regional Water doesn’t ago, but officials from the two or- Clinic Innovations has spun off Scotland, Singapore, the United Prototypes that can’t be made in have much experience commercial- ganizations have been brainstorm- dozens of startup companies over Arab Emirates and other countries. the college’s sensor technology cen- izing new technologies, but it might ing ideas for new products for the past 15 years or so — but most To become an official partner, ter — the Richard Desich Smart be a good way to generate revenue, about two years. of them have traditionally come however, the Clinic and the partner Commercialization Center for Mi- Danielson said, noting that waste- Since then, the Wickliffe-based from ideas generated by staff organization have to find at least crosystems — could be made in its water treatment plants aren’t receiv- company — which is best known members at the Clinic. one project that they can tackle to- fabrication lab, which includes ing as much federal funding as they for making additives that go into In 2011, the Clinic really started gether. equipment for designing, cutting used to. other materials — has developed broadening its horizons: Since “There has to be some sort of out- and building things. The college “We can’t be yesterday’s public multiple prototype technologies then it has formed alliances with come,” Kolonick said. could provide a good jumping off utility,” he said. with the Clinic’s input, according six other hospital systems, as well to Deb Langer, vice president and as the University of Notre Dame. general manager of Lubrizol Life- The Clinic is helping those insti- STAY CONNECTED WITH CRAIN’S Sciences. She wouldn’t describe tutions commercialize more tech- the technologies, but she said Lu- nologies, and members of the TWITTER: @CrainsCleveland INSTAGRAM: instagram.com/crainscleveland brizol has been working with a key group share ideas and best prac- FACEBOOK: Facebook.com/CrainsCleveland DAILY E-NEWSLETTERS: CrainsCleveland.com/register player on the team that performed tices related to innovation and the first face transplant in the Unit- health care. LINKEDIN: linkedin.com/company/crain’s-cleveland-business ed States: Dr. Francis Papay, chair Two years ago, the Clinic started of the dermatology and plastic going after more private compa- surgery institute. nies. And that quest continues. “And we will do more,” Langer Kolonick said he finds himself on said. the phone with a new company For a few years now, the Clinic maybe twice a month. Our semi-annual look at the and IBM have been developing Cleveland Clinic Innovations is MEETING Northeast Ohio event industry software that eventually could al- particularly interested in working low doctors to tap into the power with telecom companies, given its and how companies can pull of Watson — an IBM product best interest in delivering health care known for crushing the world’s services via the Internet. But it’s off successful meetings. best “Jeopardy!” players. open to working with any compa- The Clinic has helped IBM devel- ny that could help it come up with AND op software that one day could help new innovations and turn them doctors diagnose patients and ana- into products, Kolonick said. Issue Date: EVENT March 16 Meet Ad Close:

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28 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 LARGEST 2014 NE OHIO PHILANTHROPIC GIFTS

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FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 29 RIVER continued from page 6 ed. Lakefront Airport. environmentally toxic to meet fed- “The dredged sediment for 2015 “Ohio believes the Army Corps is eral guidelines to be dumped into would be placed in CDFs located in inappropriately requiring us to pay the Lake Erie ecosystem. So the Cleveland’s outer harbor, subject to for alternative safe disposal, which spoils were dumped in what are a non-federal entity providing absolutely is the obligation of the called confined disposal facilities, funds to cover the difference in cost Army Corps,” he said. or CDFs, along the lakefront. between (open-lake placement) The difference in cost is signifi- Until late last year, when the and placement in a CDF,” the cant. Open lake disposal can cost as Strategic Wealth Partners is pleased to host: Corps became convinced by stud- Corps said in an email to Crain’s little as $10 a cubic yard. Putting the ies of the sediment by the federal last Thursday, Feb. 19. sediment in a confined disposal Strategic Insight Lunch Series EPA that environmentally harmful “At this point in time, we do not facility, adding to the filled land discharges into the river have know how the cost differential (be- along the lake, is significantly more ESTATE PLANNING IN A LOW been curtailed enough to allow the tween open-lake and CDF disposal) costly. spoils to be placed in the lake, a will be paid, or who will pay,” the The Corps has spent nearly $5 INTEREST RATE ENVIRONMENT cost the federal government email stated. million disposing of Cuyahoga sed- would bear. It announced it want- “The Corps of Engineers contin- iment in CDFs in recent years. Thursday, February 26, 2015 ed to dump the sediment into ues to work with stakeholders That’s $25 a cubic yard for 200,000 Lake Erie this spring. through the Dredging Task Force to cubic yards. Noon to 1:15 p.m. – Lunch will be provided But Ohio EPA and local environ- resolve issues, including costs.” The cost the two sides are fight- That isn’t making the Ohio EPA ing over could be anywhere from mental groups have loudly object- Strategic Wealth Partners • 5005 Rockside Road, Suite 1200 • Independence, Ohio ed. happy. $500,000 to $5 million, depending At a meeting in Cleveland last “It is our position that until all on how this is resolved, according Centrally located in the Crown Center Building just off the 77 exit for Rockside Road Tuesday, Feb. 17, Lt. Col. Karl D. parties — U.S. EPA, (the Corps of to William Friedman, president and Register at [email protected] or at (216) 202-5980. Engineers) and Ohio EPA — agree CEO of the Cleveland-Cuyahoga Jansen, the district commander of CLE AND CPE CREDIT APPLIED FOR the Army Corps Buffalo District, that the sediments meet the criteria County Port Authority. backed off its intention to use open for open-lake disposal and do not Friedman expects it will be re- dumping and said the agency pose a risk to Lake Erie, all sediment solved in time for work to begin in would not dump dredged sediment should be disposed of in the Cleve- the spring. into the lake this year. land confined disposal facility at “It’s an argument over who is But the issue of who will pay for full federal expense as supported by paying for certain costs,” he told CDF disposal has not been resolved the Army Corps Federal Standard,” Crain’s. and no request for proposals to Ohio EPA director Craig Butler said “There’s almost no chance that dredge this spring have been post- at the public meeting at Burke this dredging will not occur.” BOOK OF LISTS 2015

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30 CRAIN’S CLEVELAND BUSINESS WWW.CRAINSCLEVELAND.COM FEBRUARY 23 - MARCH 1, 2015 OIL KEYBANK continued from page 5 continued from page 1 prices to rebound, and they have are wells that are waiting for est in it. It’s not the same as if the but also a specialized and timely ex- governor’s proposed tax increase not come back nearly as much or as pipelines to come and take away state was taxing other property, like pertise unique to that business.” has come from members of his own quickly as drillers and their in- their gas. a farmer’s barn or cornfield, he said. In the past, the same entrepre- party. Many Republican lawmak- vestors had hoped. But, over the longer term, they “The barn that you have on your neurs seeking direction or advice ers, especially those representing And while Testa and the Kasich say it will take continued drilling property, the tractor that you pur- on how to grow their business areas of eastern Ohio where drilling administration believe prices will not only to increase the state’s pro- chase, the corn that you put in the might have received assistance is prevalent, are opposed. The issue rebound, those in the oil and gas duction, but just to keep it level as ground — these are things that you through different, less-structured is a hot one in legislative discus- industry are not sure that will hap- the production rate of new wells did. … The natural gas and oil is not methods. sions, said Brittany Warner, press pen, at least any time soon. declines rapidly in as little as a year. something that you did,” Testa Now, there’s more of a “fast lane” secretary for Ohio House Speaker “Many operators are struggling For that to happen, drillers will contends. “The natural gas and oil for those services, Devine said. Clifford Rosenberg, of Clarksville, to survive . . . we have to adjust to a have to keep investing in the Utica is something that developed over “We want you to be able to walk near Cincinnati. new era,” said Shawn Bennett, ex- shale — and they won’t, unless it’s 400 million years and happens to into a branch and we want to be able “Speaker Rosenberger and the ecutive vice president of the Ohio more profitable than other drilling be under the state of Ohio.” to serve you holistically as a business members of the caucus will be dis- Oil and Gas Association. opportunities in Pennsylvania, That might anger many Ohio owner right through that same loca- cussing that issue over the next sev- Low prices already are slowing West Virginia or other parts of the landowners, but it’s in keeping with tion,” Oliver said. eral weeks,” Warner said in an email. down drilling in Ohio, and an addi- United Sates. the logic behind most states’ sever- “Maybe this was a different “The budget proposal is very com- tional tax burden will only exacer- process before. Maybe you worked prehensive and calls for several ma- bate that situation, Bennett argues. “There are people out there who think the oil and gas with a business banker who wasn’t jor tax changes that the members of In Ohio, at least a half dozen drillers local. Now, you have a branch man- the caucus are still evaluating.” have announced cuts in their oper- industry is immune to commodity prices and we’re just ager you’re going to be seeing any- Rosenberger voted in favor of Ka- ational budgets of up to 40%. And, rolling in money — what’s happening today proves that’s way, and they will be the face of the sich’s last proposal to increase sever- along with the rest of the nation, not the case.” relationship, and they’ll be tied to ance taxes, which ultimately failed to the state has seen the number of experts who can help your business become law last year, but Warner drilling rigs working here decline in – Shawn Bennett grow.” said low oil and gas prices are weigh- recent months. executive VP, Ohio Oil and Gas Association Key executives declined to coming on legislators’ minds as of late. “There are people out there who ment on how much the company is “Absolutely,” she said. “House think the oil and gas industry is im- “If they’re not getting any money ance taxes, said Andrew Thomas, a investing in its new business re- members are in discussion about mune to commodity prices and out of the ground, they don’t have long-time Louisiana oil and gas at- source segment. the economic impact a tax increase we’re just rolling in money — any money to put back in,” Bennett torney who currently researches Fred Cummings, president at would have on that industry and, in what’s happening today proves said of Ohio’s drillers. “And it re- the economics of drilling in Ohio Elizabeth Park Capital, a Pepper turn, how that affects local commu- that’s not the case,” Bennett said. mains to be seen how long this for Cleveland State University. Pike hedge fund that invests in nities and the state economy. So, “You have people who won’t com- downturn will last . . . You have “It’s a fiction that people own the bank stocks, said the initiative for a price and production volumes will mit to new wells because they don’t some analysts saying it will be two ground beneath their house. … company like Key, which has al- be part of the conversation.” know what commodity prices are years or more. It will take a year for People think they have a right to ways focused on small business, Testa, however, said the low going to be, they don’t know what the industry to get comfortable, what’s underground all the way to comes down to fine-tuning the ap- price of oil is distorting the picture taxes are going to be and so forth.” back on solid ground and moving China. The world does not look at it proach. in Ohio, where drillers are after not forward.” that way,” Thomas said. The move likely will attract more crude oil, but natural gas. Finally, there is the question of “There has to be a way to share A question of priorities entrepreneurs while further sup- “Ohio is primarily a natural gas fairness. The governor wants to use the value of the minerals with the porting existing clients. At face value, play, so things have not shifted that That brings into question severance tax proceeds, along with public and the best way to do that that means drawing in more de- much,” Testa said. “If this were an whether the state can raise as much money from an increase in the is with a severance tax,” he said. posits, Cummings said. oil play, things would be different money as the governor hopes — state’s sales tax and other sources, to “And the severance tax has to be But new, entrepreneurial cus- economically — but it’s not, it’s a more than $200 million a year by help pay for an income tax reduc- real and meaningful and right now tomers could result in additional natural gas play.” 2017 — from oil and gas, in an en- tion. Lowering the income tax rate it’s not. I support increasing the business for the bank via possible vironment of low prices. for all Ohioans has broad support, severance tax for that reason.” financing opportunities for the The price isn’t right Testa said that’s not a concern, but is it fair to ask one industry, such As to what the rate should be, client’s company or for the individ- because the administration was as oil and gas, to shoulder more of Thomas said he’s not sure. The sev- ual’s personal needs, which might While the price of oil has col- very conservative in the price and the cost than others? Testa thinks it erance tax should be examined translate to mortgages or auto lapsed from more than $100 a bar- production volumes it predicts. It’s is, and that all Ohioans should ben- alongside things like the sales tax, loans. rel last year to about $50 a barrel to- not counting on a spike in natural efit from the state’s oil and gas. commercial activity tax and others, “It’s a very good segment to focus day, the price of natural gas is in the gas prices or any increase in pro- “It’s a one-time natural resource to measure a driller’s total tax bur- on because most businesses are same $3 per mcf that it was selling duction beyond what drillers them- that’s being extracted from Ohio, den, but that’s often difficult to do small businesses, and it’s a great for in 2012 — though it did spike to selves have predicted, Testa said. most of which is going out of state from state to state, he said. source of core deposits,” Cummings nearly $5 per mcf in the interim. Most in the industry say that if to out of state firms,” Testa said. He does, however, think Ohio’s said. Drillers, however, are quick to drillers stopped developing new Even though the law says that the rate is due for a raise. “It’s also a niche that’s very com- note that the prices of 2012 were, by wells in Ohio today, the state’s pro- oil and gas beneath the ground is “It should be comparable to what petitive because you got a lot of historical standards, very low. The duction still likely would increase privately owned, Testa contends all other states charge, and it’s not,” small banks, and that’s where their industry has always counted on over the near term, because there residents of the state have an inter- Thomas said. core business is.” REAL ESTATE CLASSIFIED Phone: (216) 522-1383 Fax: (216) 694-4264 Copy Deadline: Wednesdays @ 2:00 p.m. Contact: Denise Donaldson E-mail: [email protected] All Ads Pre-Paid: Check or Credit Card

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FEBRUARY 23 - MARCH 1, 2015 WWW.CRAINSCLEVELAND.COM CRAIN’S CLEVELAND BUSINESS 31 REPORTERS’ NOTEBOOK THE WEEK BEHIND THE NEWS WITH CRAIN’S WRITERS Geauga County wants a This technology literally Fun is just starting FEBRUARY 16 - 22 piece of region’s film action is state of the art for student venture fund Geauga County has a message for Holly- The Cleveland Museum of Art, already a The Northeast Ohio Student Venture Frack away: The Ohio Supreme Court ruled wood: “We’re open for business, too!” technology pioneer with its ArtLens app and Fund has generated its first profit: $833.33. that the Summit County community of Munroe Toward that end, the nonprofit Geauga the interactive Gallery One, is stepping up For the first time, the fund — which is run Falls cannot use its zoning laws to ban hydraulic Growth Partnership has booked Cleveland its digital game. by graduate students at six local colleges — fracturing, saying such authority belongs to the Film Commission President Ivan Schwarz as The museum is releasing its first special received a check from one of the companies state. The court ruled 4-3 that Munroe Falls’ zon- the keynote speaker for its annual meeting exhibition mobile application, “CMA Senu- in its investment portfolio last week. ing ordinances and local laws governing oil and this summer. fo,” designed for the “Senufo: Art and Iden- A waste management software company gas drilling exceeded the authority of the city’s “The Film Commission’s vision for in- tity in West Africa” show, which opened on called Wastebits borrowed $25,000 from the home rule power. Munroe Falls has tried to stop creased economic development, workforce Sunday, Feb. 22. The app is free and is avail- Student Venture Fund in April. If the Akron- Ravenna-based Beck Energy Corp. from devel- development and job creation is so in con- able for iPhones. It offers “insightful com- based company had held on to the money, oping an oil and gas well within city limits after cert with the mission of Geauga Growth mentary, high-resolution imagery and it would have eventually converted into eq- the company in 2011 received a permit from the Partnership,” said GGP president Tracy video,” the museum says, and thus “encour- uity, giving the fund an ownership stake in Ohio Department of Natural Resources. The Jemison, in an announcement that also was ages a closer look at some of the exhibition’s Wastebits. Instead, the company decided to court ruled state law prohibits local government a nod to Cleveland’s success in getting individual objects and the story behind Sen- pay it back early, with interest. from exercising powers “in a manner that dis- some economic boost from the movie busi- ufo-speaking artists and patrons.” The money will go back into the fund, ac- criminates against, unfairly impedes, or ob- ness. “It makes perfect sense to bring Ivan to “Senufo: Art and Identity in West Africa” cording to Dan Hampu, who serves as an structs oil and gas activities and operations reg- Geauga County, so we can learn from their features nearly 160 loans from museums adviser to the fund for the University of ulated under” Chapter 1509 of the Ohio Revised successes.” and private collections in Europe, Asia, Akron Research Foundation. Code. Movies like “The Avengers” and, coming Canada and the United States. The fund, which has made a total of four up soon, “The Wake,” starring Bruce Willis, Museum director William M. Griswold investments, began in Akron, but now it also The future is now: Cleve- have chosen Cleveland as a location in re- said the museum “takes the development of involves grad students from Case Western land Clinic and broadband cent years. Observers say that area business- cutting-edge technologies and interpretive Reserve University, College of Wooster, Kent and cable television provider es have benefited from that activity, and the materials to the next level with this exhibi- State University, Notre Dame College and Cox Communications Geauga Growth Partnership has been tion app.” He said the technology “allows Walsh University. formed Vivre Health, a ven- watching. visitors to experience this exhibition in ways They select which companies should get ture aimed at developing in- The group notes that businesses ranging not possible before.” funding. Then their recommendations go to home health care services. from hotels and restaurants to real estate The museum’s partner for the next gener- a board that includes faculty members from Dr. Thomas Graham, chief agencies all benefit from working with the ation of exhibition art apps is DXY Solutions each school, the University of Akron Re- Graham innovation officer at Cleve- film industry. It said the county also has tal- LLC, a creative technology agency based in search Foundation and the community. land Clinic, said that health ent and production professionals who Cleveland. “As much as possible, we follow a venture care transformation “will be led by organizations could provide their services. (Plus, Geauga Dan Young, CEO of DXY Solutions, said capital structure,” Hampu said. that embrace innovation and collaboration. This County is about as picturesque a rural envi- the museum “has a unique vision for using The fund has been able to accelerate its alliance will accelerate the creation, develop- ronment as any director could want.) technology to compliment its exceptional investing lately: Over the past year or so, it ment and delivery of solutions that will improve The event is June 24. Details on registra- collection; it’s great to partner with such a raised $250,000 from the Ohio Third Fron- and extend human life.” See related story, Page tion are coming soon. forward-thinking institution.” tier program, the Burton D. Morgan Foun- One. — Dan Shingler — Scott Suttell dation and other donors. — Chuck Soder Time for a change: An investor group affili- ated with New York City-based Time Equities Inc. paid $20 million to become the new owner WHAT’S NEW BEST OF THE BLOGS of the last six of Duke Realty Corp.’s office buildings in Northeast Ohio. Cuyahoga County land Excerpts from recent blog entries ical director of the Wellness Institute at records show Rockside Magnolia SCC LLC ac- on CrainsCleveland.com. Cleveland Clinic, for some advice. quired the properties from the Indianapolis- Here, for instance, is his take on whether based real estate investment trust. The just-sold Hey, it’s only one month flu sufferers should stay home and spend properties include four Independence office days in bed: buildings: the Freedom Square I, II and III office The Akron and Cleveland home markets Dr. Neides says when he prescribes bed buildings on the 4400 block of Rockside Road; are off to a slow start in 2015, at least based rest, he is erring on the conservative side to Oak Tree Place, 6111 Oak Tree Blvd.; and an ad- on asking prices as measured by the Trulia ensure patients aren’t out and about, infect- joining six-acre parcel. Two other buildings — Price Monitor. ing others and contracting different strains. Rock Run North and South on Lombardo Cen- Forbes.com reported that nationwide, “While you’re battling one infection, your ter — are in Seven Hills asking prices on for-sale homes “climbed immune system is busy and you’re suscepti- COMPANY: Osborn, Cleveland 0.5% month-over-month in January, sea- ble to other contagions. It’s hard to fight a End of an era: Anthony J. Alexander, former sonally adjusted — the smallest monthly two-front war,” he says. “The point is to not CEO and now executive chairman of FirstEner- PRODUCT: ATB composite disc gain since August.” Year-over-year, the overtax the system so you can focus your gy Corp., will conclude a 43-year career with the brushes with a molded shell mill website said, “asking prices rose 7.5%, strength to fight the good fight.” company on April 30. He’ll step down as execu- down from the 9.3% year-over-year in- He doesn’t suggest patients with a bad tive chairman on that date. Alexander, 63, also mount crease in January 2014.” cold or flu lie prone all day. Rather, The Jour- will leave FirstEnergy’s board of directors effec- Osborn, a major global supplier of indus- Asking prices increased year-over-year in nal said, “he wants them to be as still as pos- tive May 1. George M. Smart, currently the com- trial brushes, says its new brush design fits 94 of the 100 largest U.S. metros. Akron and sible in a comfortable position.” That could pany’s lead independent director, on May 1 will into users’ existing shell mill holders and Cleveland are two of the six markets where mean reclining in an overstuffed chair, and return to his prior role as chairman of the eliminates the need for adapters to fit into year-over-year prices have fallen. not necessarily the actual bed, he adds. FirstEnergy board. their milling machines. The Trulia data show Akron was the sec- Once a fever has subsided and a person The new mount design for Osborn ATB ond-weakest market in the country, with doesn’t feel lightheaded or dizzy when stand- Hoop it up: One of the nation’s longest-run- “also eliminates the need for additional asking prices in January down 3.3% from ing, a little activity can be added gradually. ning relationships between a city and a confer- tooling between the user’s spindle and the January 2014. Cleveland was the fourth- ence tournament just added six more years. The composite disc brush,” according to the weakest market; asking prices were down Blaze of glory Mid-American Conference and Quicken Loans company. 1% in the first month of 2015 from the like Arena agreed to a six-year contract extension to “This new design on Osborn’s ATB com- month last year. Blaze Pizza, a chain that counts LeBron host the MAC men’s and women’s basketball posite disc brushes eliminates that extra Forbes.com said the metros where home James among its investors, “is taking over tournaments at the home of the Cleveland Cav- adapter for use in milling machines and prices are rising fastest, including Atlanta, America,” according to aliers through 2023. The current agreement runs saves our customers on the cost as well as Houston, Indianapolis and Denver, “are, al- BusinessInsider.com. through 2017. the extra step for set up,” said Mike most without exception, the ones with The story noted that Blaze opened 50 Akuszewski, field application engineer at faster job growth. Why? A growing economy restaurants nationwide last year, and this Leaving a mark: The Gay Games that took Osborn, in a news release. fuels housing demand. Among the 10 met- year it plans to open 60 to 70 new locations. place last summer generated $120,000 for the “This new mount style adds more dura- ros with the biggest year-over-year price in- Celebrities including James and Maria Gay Games LGBT Legacy Fund at the Cleveland bility for applications that demand high- creases, nine had at least 2% year-over-year Shriver have invested in the brand, which is Foundation and $27,000 for the Gay Communi- speed, clockwise and counter-clockwise ro- job growth.” based in Southern California. tation changes compared to other pin-drive ty Endowment Fund of the Akron Community On the flip side, the website noted, “near- Blaze is all about Chipotle-style cus- systems,” he said. Foundation, a report found. The donations rep- ly all 10 markets with the slowest price gains tomization. Osborn says the ATB composite disc resent the net profit from Gay Games 9, which (including six with declines) have had rela- Customers build pizzas choosing from brushes are “easy to integrate in machining Cleveland organizers describe as the most prof- seven cheeses, eight proteins, 20 vegetables, centers and provide repeatable results.” The tively sluggish job growth.” Akron’s year- itable in the event’s 32-year history. The report and three sauces, said Blaze president Jim new brush models additions to the existing over-year job growth is 1.6%, while Cleve- was issued in conjunction with a panel discus- Mizes. The pizzas then are placed in a stone ATB line and “save customers on the cost of land’s is just 0.3%. hearth oven and are ready in about three sion at the City Club of Cleveland. It found that the adapters,” according to the company. minutes. the games generated $6.8 million in revenue — For information, visit www.osborn.com. The only prescription … $2.36 million from sponsors and donors, $2.64 The company’s website shows there are million from registrations and civic contribu- Send information about new products The Wall Street Journal reminded us that outposts in Columbus and Cincinnati, but tions, and $1.8 million in in-kind contributions. to managing editor Scott Suttell flu season “still has a few weeks until it not Cleveland. Maybe James can do some- at [email protected]. ends,” and it asked Dr. Daniel Neides, med- thing about that. 20150223-NEWS--32-NAT-CCI-CL_-- 2/20/2015 12:10 PM Page 1

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