 Aloha everyone and welcome to SBA America, where we focus primarily on small businesses in Hawaii. Thanks for joining us again today. We have some interesting things going on and a super guest who I think you'll really enjoy hearing from, learning a little bit more about his business and what he thinks about the big picture, how he got to run this amazing small business in such a short period of time. We're welcoming Raymond Jardine today. He's the CEO for Native Hawaiian Veterans, quite an accomplished firm in 11 years. Ray is an encore entrepreneur himself. He helped SBA out this past weekend with our presentation that we conduct for people who have perhaps left a career, left a job and are looking at becoming an entrepreneur after the age of 50. So he shared with us some of his experiences and we'll talk a little bit more about that today. But first, I just wanted to let you know about a couple of other things that are coming up in our neighborhood to help small businesses. One is next week on the 23rd and it's called our Regulatory Enforcement Fairness Roundtable. SBA will be bringing in people from the National Ombudsman's Office to talk to you, small business owners and other community leaders about how small business regulations from federal agencies actually affect your small business. If you've got something that's really been giving you a problem or you see a better solution to something that a federal agency has required a small business or asked a small business to do, please join us at the HDO, Hawaii District Office for the SBA and that's at 9.30 to 11. You can call my office at 541-2.990 for more information or you could go to SBA.gov and look up our Ombudsman's Office and they can give you some direct information. It'll be a great event, a lot to talk about and looking for more solutions for small businesses. We also have the Native Hawaiian Organization Business Summit coming up on August 24th and 25th, excuse me, and that'll be at the Prince Hotel. You can go to nhoassociation.org to find out more information. There'll be leaders from DOD and SBA officials to talk about how some of our government contracting programs work to help the economic development of our Native Hawaiian community. There'll be a lot to talk about. We'll be talking about new government contracts and new things that have come up recently in the rules and regulations on the FAR that will help small businesses get a bigger piece of government work. So that leads a great segue to introducing Ray and talking about how he got Native Hawaiian veterans started and how they experienced such phenomenal growth. Ray, welcome to the program. Thank you. It's good to see you again. I've known Ray for quite some time and Native Hawaiian veterans is 11 years old now, but they've been growing at a pretty amazing clip. How do you account for that, Ray? I think when we first had the conception of starting the business, there was about three of us that were talking about it, and it kind of started initially with a friend of mine, Mike Irish, who is an entrepreneur. We went to high school together, Kalani High School, and he talked to me when I got out of the military to start a business. So with that, I gave that a thought, met with a couple people, looked at the federal market plays, and then we started determining what type of programs we might want to get into. So you had a long military career as well. So you retired, and then it was, what do I do next? Yes, 33 years with the military, and then a short period of time with the post office as their senior emergency manager. And again, it was Mike Irish that kind of led me towards looking at entrepreneurship. And when we looked into the program, initially we were looking at the Native 8A program. In 2004, they gave Native Hawaiians an opportunity to compete in their marketplace with the Alaskan Native corporations and the federal recognized tribes. So I was looking at that and came on the board of one of the NHOs, Alakena Foundation. But at that same time, the president started an executive order giving disabled veterans an opportunity to do work in the federal marketplace. So I decided to do that disabled veteran program where I gave disabled veterans 3% goal to go into federal work. So that's how we kind of started the company. So the opportunity was right, and so you could just kind of seize the day and go after it. You had a background with IT primarily when you started. Maybe tell us a little bit about yourself, too, because sometimes you don't think that the local kids have a very entrepreneurial mindset, but you're kind of a rascal, huh? Well, I spent a lot of time playing when we were young and having a good time doing that. Then when I graduated from high school and started to go to work and I didn't see college in my career initially and joined the military. And then I realized that a continuous education was critical for any growth that you're going to have. So started going to school, getting educated, and then moved up the ladder in the military. So when we got out, had some skill sets already established that if I'm going to go into the federal marketplace, some of the things I've done in the military actually transitions quite well over to that. So we started initially as an IT, emergency management company, and that kind of grew. In fact, within two years we were getting a lot of opportunities. In fact, one opportunity was a huge opportunity with Siemens, a very large, large government prime contractor, on a contract to do security systems at embassies across the world. And we were one of three companies, small businesses at the time that was brought on with Siemens to go after that work. And that's what helped us kind of take off. And since then we've been doing work in 50 countries, I mean, correct, in 50 states for territories that work in 20 countries currently in six. So we've kind of expanded our horizon. Right. With just a couple guys getting going and you have grown in now a couple hundred to over 200 employees. Yeah, we have approximately 240 employees now on about 140 vacancies. Did you, was this part of your vision when you were getting started? Oh, no. Okay, this is going to start up. We thought it was going to be a small business in Hawaii, you know, hopefully doing a couple million. And the next thing we know it as we expanded our horizon, we just kept going and going and going and to where we are today, which is Hawaii's business of the year. And we came in second overall in the nation. I would be definitely remiss not to point that out to you as well, that Ray is the 2016 small business person of the year for the state of Hawaii. And with that we sent him off to Washington to represent small businesses here in Hawaii and he became second runner up. Did you have any clue as you went into the ceremony that you were going to be honored for your accomplishments like that? Well, I knew I made the top 50 of four because I wouldn't be there, you know, as I represented Hawaii. Wasn't had no clue, but that we would be in the top three in the nation. Yeah, because that award does specifically look at somebody who started a company and been very entrepreneurial, has created jobs, generated revenue, overcome adversity, you know, as well. So I think, you know, you even in the 11 years that your company has been established and been around, you've kind of managed all those different kinds of experiences, hiring lots of people, having to deal with changes in the economy as well. What would you say are some of the what you grew so fast? Was that challenging to manage that? How did you do that? Actually, you know, we were growing a lot faster and then had to kind of throttle back a bit there, can't outrun your cash and that would be easily could have been done if we just kept growing and not thinking about the holistically running a company and all the moving parts that come with it. So as we grew, I had to make sure that we had the necessary finances to continue the growth along the way. And that line of credit we got with the bank gave us an opportunity to expand our horizons. And with the government contracting methodology, it's about we call it the lag pay system. It takes a little while for the government to pay you. So you better have some cash reserves there while the government eventually pays you along. The government is going to pay you just a matter of when, you know, it takes a little while. You have to invoice the government 30 days later. And then the government may pay you anyway from 10 to 60 days later. So you have to have that little buffer about 90 days of cash reserves to continue your growth. So you have to have that capacity in order to get those contracts and then perform on the contracts and then still have a little bit of time before the the payout comes back to you as well with the growth. Besides the cash is you've got to have the infrastructure. So the infrastructure can't get ahead of the growth because then then you're paying out too much. So that's a lag system too. As you grow, your infrastructure is playing catch up many times. So if you get too far, that gets too far ahead of you, then you have issues and challenges as well. Did you have to really keep a keen eye on everything that was going on in your business during those times? I mean, I think you probably still do. No, the difference then was in the military as well as a commander as you you've got to keep pay attention to all the moving parts. And as a president or CEO, I think the three critical elements that you have to do is you've got to pay attention to your operations. You've got to perform. You've got to be on time, on budget, beat and exceeds your customer's expectation. You've got to keep your financially healthy of your organization. So pay attention to that. Not only your profits, but on how you're running your business and spending wisely and being prudent about what you spend to grow your company. And then the third part is you have to grow your company. Because if you're not growing it and there's a little saying you call it, you're not growing, you're dying. You're not growing, you're dying. So and you have had you've had good luck in bringing in people on board. Do you find have any issues or trouble finding employees here in Hawaii? Initially, it's all about word of mouth. If somebody's going to give you a recommendation, they're putting their name on the line. So it was easy to find people at the beginning. But as we grew and grew the capacity of word of mouth, then we had to use processes, resumes, companies to come in and recruit for us. And that changed the landscape quite a bit. So we have always used a process called Kinole. It's the name of our foundation as well. It's about doing the right thing with the right person at the right time for the right reason and the right value the first time. So when we do that, we have a tendency of finding that right person with the right value. There's a tendency, many times when I speak in the mainland at conferences, people talk about the best and the brightest. And I totally disagree with that. I think it's about that right person at the right time for the right position. Because you can have a brilliant person that doesn't fit the climate or the construct of your organization and can be actually cancerous towards your organization. Yeah, I think that's a rare insight that most of the time we are looking for the best and the brightest. But you do really need that whole package. It's a team effort. You've got to have everybody that fits all the different puzzles and go in the right place. Yeah, so somebody who is extremely talented and forward thinking and everything can really be toxic to an organization. So that's one of the toughest decisions and managing people, I think. Yes, you've got to pick that right person the first time. Because it is, and spend a little bit of time doing that. Don't rush through the process of hiring someone because otherwise you're going to have to redo it again and it gets painful trying to do it again. I guess with over 200 employees, you've kind of worked through that system a bit. So some of the other things that you've expanded, because now as you've said earlier, you've gone from a relatively small business working in IT to a number of different areas. And it probably took some time to be recognized or get that experience and gain those specialties. But how did you go about that? Or did that just kind of happen organically? Like I mentioned, we started off with IT and emergency management. But as we continued to grow and bring in new employees, we found out some of the employees had different skill sets. And because of those skill sets, we started expanding and diversifying the business a little bit more. As a philosophy that we had was that if you're too niche, then you could put yourself into an area where if that niche goes away, you go away. So we diversified the company. We diversified our clients that we were going after. So we did work with the federal government, Department of State, Homeland Security, DOD. And then we also did City and County of Honolulu and all the counties in the state doing state work, doing some commercial work so that when one area may not be as profitable or as prevalent as another one might be, so it creates a really good balance for the organization and it allowed us to continue to grow and then pick up some past performance and skills in one area that we may not have in another. Okay. Well, I think we want to ask a little bit more about that. I think we're going to go to a break right now, but we want to talk a little bit more about some of the different certifications you have and how you have used those to help your business as well. So stay with us. We'll be right back. Hey, everybody. My name is David Chang and I am a new host for the show, The Art of Thinking Smart. I'm really excited to be able to share with you how to get the smart edge in life. We're going to have awesome guests in the military, business, political, nonprofit world. So no matter what background you're from, we have something for you. Please join us every other Thursday at 10 a.m. at thinktechhawaii.com or on the art of thinkingsmart.com. I look forward to seeing you. Aloha, everyone. I'm Maria Mera and I'm here to invite you to my bilingual show, Viva Hawaii, every other Monday at 3 p.m. We are here to show you news, issues and events local and around the world. Join me. Aloha, everybody. My name is Mark Shklav. I'd like you to join me for my program, Law Across the Sea on thinktechhawaii.com. Aloha. Well, we're going to continue our conversation with Rage Ardine, our small business person of the year for the state of Hawaii and a great example of how to grow your business and really look at the cultural values and really know what your core business is and how to really move that forward and make a difference, because obviously with the number of employees you have, building an office culture and keeping them focused is a big, big task. We were talking a little bit about your kina oli spirit and that everybody in the office does kind of embrace these values. Can you tell us a little bit more about how you kind of have been able to use that to galvanize your workforce? Two things in that area, our mission statement that we have and then our cultural statement that we have. So our mission statement is to be a trusted partner, earning customer loyalty, while creating profitability for our employees, we call it ohana and the family, and then enriching our community. So those four pillars, right, our customer, our partners, our employees and the community is what we're made up of. That's the construct of what we... And then the values of that is the kina oli spirit where we apply, you know, doing the right thing at the right time to put it all together and synchronize the company's goals and objectives. Can you give us an example of how that works with your staff and how you are seen in the community? From the staff, I'll give an example. We might be in a meeting and everybody has different opinions and maybe the discussion gets a little bit off track or a little heated. And on one perspective versus another perspective and I would just point to the sign right there in the conference room is this is how we do business. This is what we're about. So we go back to our core values. I think we could come up with the right solution and we usually do because of that. Okay, that sounds really good because I'm sure that with a lot of people you mentioned their skills and their experience and being in so many different areas because now it's IT, it's national security, it's cybersecurity, it's facilities management. It's, you know, you've got, you could probably roll three or four more off. I know your capability statement online lists a long, long, long, long, long list of different NAICS codes that you can perform under. So how does all that work? A lot of the two is because of the ADA program it allows us to go after direct awards and do what's called, we call it unsolicited proposals. And an example would be there was a range of operations out of Fort Still, Oklahoma. It was a bombing range for the Air Force and we approached them to say that we had some of the skill sets we thought we could do the work. And actually the command was out in Texas in the Fort in Dallas area. So we went down there and talked to the command talked to the contracting people and as we were able to actually convince them with our past experiences, not necessarily our past performance as a company because we didn't have one as a doing range operations at that time. But they made them feel comfortable enough that with our past experiences being in the military doing things of that nature the command actually felt comfortable enough to say I think these are the people we want. These are the ones that they've said the right things that they're going to perform. And I've done this with another customer once and I said we don't necessarily do everything right. And it gets their attention because they get a little apprehensive. But then I caveat that it says when we do make mistakes we don't make the same mistakes. We don't make catastrophic mistakes. But there's no company you can tell you that they don't make mistakes because if they are they're lying to you. And the reality is that we're pretty honest we're straightforward and we're going to do our best and we do make a mistake we fix it quickly we get it done and we don't make the same ones. And those honest approaches to the customer I think that radiates a lot more than if you've given them just a standard pitch line how great we are. And in reality then everybody's great and that's not true. So the key is anytime you do a contract things may go wrong and what's your ability to fix it before it gets worse or to anticipate some of the shortcomings and that's been real helpful for us as we've gone after contracts. So being accountable and being willing to remedy situations should they get a little off course. You don't be 11 years in this business and something did not go wrong. I think that would be as you said somebody's not being entirely truthful if they're telling you that's the situation. You mentioned relationships and talking with people in business about doing business with them and why they should rely on you. How important have relationships been in building your business? That's how we got started. Relationships is the most critical element of getting in the door. Even when we started the company I went golfing with Ron Megida who was that time was a chairman of Central Pacific Bank and actually it was at Citibank and then they merged together. And so I told him I was going to start this business and he said okay you know I'll give you your first loan I'll give you $150,000 line of credit. You know I think you'll be successful right so you know through the chairman the president we can make that happen. I said thank you and he says but you know when you want more money from me that's from the bank he says put your house up. And so I chuckled a little says you're joking right and he goes no I'm not. He says the bank is not an at risk organization. Our job is to look for people that are going to be successful and give them opportunities so they can be successful but we want you to have some skin in the game. So no skin in the game nothing out of me. He says so put some skin in the game and we can continue this compensation. So since then you know after more and more lines of credit as we grew understood what he was trying to say is that you've got to show if you got skin in the game you're in. If somebody else is fork in the bill maybe you're not quite as in as you should be. You're not as as committed to the idea and the concept that you're putting forward so but I'm sure since that time you've grown a lot and both in your financial relationships as well so you're probably Ron has been a great friend and our and helped move your business forward but you've kind of moved moved into a kind of a different area in terms of your financial capacity as well. Yes we no longer have to put my house up where the company can stand on its own where we don't have to credit my house anymore. So that helped a lot. Yeah it makes a little easier to to get home and get to sleep at night and reduce the stress. Yes. Yeah so that's great you know. So the SBA designations those service disabled veterans the 8A those really supported the growth in your company and open doors for you. I would say yes for the most part. It's good to have all these designations. You know the federal marketplace has all these preferred programs for HUBZone 8A women owned disabled veteran programs and to have these additional identifiers has made it helpful. Now we have never wanted disabled veteran set aside contracts but it's a good designation to have because it brings us into where the government gets to use that as a criteria. The 8A I used it sparingly. I didn't want that to be so our main focus because there's a tendency actually when you come off the 8A program if that's all you've done your company don't have the the foundation actually to continue on so business-wise went after full and open contracts so we had a more diverse portfolio and not just focused just on the 8A program where like I mentioned a lot of companies after they come off of it have failed because they didn't transition well. They haven't really marketed themselves across the board to a lot of different opportunities and as you said you've diversified pretty well with state city county and then different federal agencies as well. You're in an enviable position right now with a well run company that's pretty successful very successful I'd say and has even outgrown many of those size standards so for the little guy you're a pretty big business right now. What does that allow you to do? What else are you interested or maybe involved with now? Well what we're doing now is actually starting an NHL that native Hawaiian organization with under the native 8A program acquiring two to three more companies to fall under that organizational structure and we're talking to some other NHLs about creating a strategic partnership so that we can grow as a collective entity that we can actually partner with each other on opportunities. It's a great program to give native people in that program alone we have to, some of our profits have to go back into the community efforts so it goes beyond just being the business and about profits that you put in your pocket but it's about giving back to the community. And particularly to foster economic growth and economic development in the native Hawaiian community. It's a great tool. It's also a great tool because when you talk to a potential client or a customer or a contracting officer we lead with the fact that we give first and that was the term that I use on Saturday about you give, you get, you get, you give. And that philosophy actually is that they look at that that you're not just about trying to make money but you're trying to make a difference not only for the customer but for your community. It sells really well. Yeah. And so you have an event coming up that you've worked on that's very dear to you that kind of merges your experience as a veteran with your native heritage. You want to tell us a little bit about this? Yeah, we, you know, with our foundation we do what was called GapKid programs to help youth programs as well as veteran programs. So one of our veteran program is called the Not Coal Wounded Warrior Outrigger Canoe Race. About five, six years ago we got involved in this program and it was pretty small at that time maybe six or seven outrigger canoes racing. And today, in fact, this weekend will be the Regatta and it starts off on Thursday with a reception and then on Friday we have a wounded warrior job fair for veterans that are looking for jobs and then Saturday kicks off the Dukahanamoku Fests with the Wounded Warrior Outrigger Race. And this year we have over 600 paddlers participating in four divisions. We have a veterans division, combat veterans, Wounded Warrior and Gold Star Family Division. So it has grown to be a huge logistic nightmare that we never thought it would get this big. This big. But it's a great cause. Yeah. It sounds like a wonderful experience and a great way to do their place for spectators to come down or other people to... About last year about 1,500 people were on the beach watching the event and it's always more exciting when it's a close race when it's like when it's a runaway you don't hear a lot of cheering going on but when it's a close you hear everybody yelling and screaming and getting involved. So a good family activity out on the beach and supporting our veterans. And there'll be the Marine Corps band performing, playing music as well. Quite a festive day. So what time does it all start? It sounds like it's the place to be. It starts at eight o'clock the blessing because at eight o'clock some opening ceremony from our congressional delegation and then zero nine hundred we hit the beach. Okay. With that performance. Terrific. Thanks for doing that for the veterans and best of luck. Have a... We may be... May we have great weather. So thank you so much for being with us. We'll see you next time. Thanks very much.