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13 JUNE 2013
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13 JUNE 2013
ParenteBeard Partners Leave, May Join Rival BDO’s Local Office
Cooper Health Care, Local Firm Neiman Houston Site Partner Acquired By A&G On New Cancer Center
Philly.com reported that at least a dozen partners at ParenteBeard, Philadelphia’s biggest accounting firm, have quit and may be joining a rival firm. Richard T. Farrell from the firm’s Philadelphia office, Alan Molin from its Clark, N.J., office and other audit partners have handed their resignations into chairman and CEO, Robert J. Ciaruffoli, who has notified colleagues of the partners’ departures. The partners are possibly negotiating a move to join rival BDO’s Philadelphia office. Both BDO and ParenteBeard target midmarket and regional companies for financial services. Thirteen partners originally handed in resignations, but one was rescinded, according to the firm’s statement in the Philly.com report.
Cooper University Health Care in Camden recently announced a partnership with the MD Anderson Cancer Center of Houston. MD Anderson will manage a new $100 million cancer treatment center, scheduled to open this fall. The two organizations will also work together to expand the cancer center satellite hub on Cooper’s campus in Voorhees, NJ. “This is a game changer for cancer care in our region,” George E. Norcross, III, Chairman of the Board at Cooper, said. “We will
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Philadelphia marketing agency Neiman has been acquired by Boston’s Allen & Gerritsen. The agency will operate under Allen & Gerritsen and will have close to 200 employees in Boston and Philadelphia offices.
Aqua Pharmaceuticals Acquires Rights To Verdeso Product West Chester-based Aqua Pharmaceuticals recently announced that it has acquired the U.S. rights to, and relaunch of, Verdeso Foam. Verdeso Foam is a low-potency cortocosteroid foam that is used to treat mild to moderate atopic dermatitis. Verdeso is unavailable as a generic. Aqua will assume control of all manufacturing, distribution and promotion of the product.
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6 JUNE 2013
SMG To Manage Convention Center West Conshohocken private management firm SMG has been hired to run the 974,000 sq. ft. Pennsylvania Convention Center in the recent face of growing concerns over the center. One of the main concerns has been an extreme downtick in convention clients. The multi-million dollar expansion in 2011 was expected to bring 20 to 30 more clients per year. Though there are 20 conventions planned for 2013, the numbers dwindle following that with eight conventions planned in 2016. The Center’s chairman said hiring SMG was “an important first step” in revitalization and reversing the recent downslide. Some board members, however, are remaining skeptical. LABOR
Supreme Court Won’t Intervene The Philadelphia Inquirer reported the state Supreme Court denied Mayor Michael Nutter’s request to hear arguments on whether the city should be allowed to impose a contract on 6,800 municipal workers represented by AFSCME District Council 33. In a decision voted on 6-1, Chief Justice Ronald D. Castille said the court should have intervened, saying “It is apparent that this court will ultimately need to weigh in on this issue.” LAYOFFS
Boeing To Lay Off 41 Local Workers Effective June 21, the Boeing Company will let go of 41 employees from its 6,200-member staff in Ridley Park. In a letter posted on the United Aerospace Workers Union Local 1069 website, union president Chris Owens said the matter was solely a business decision. “One thing to remember things can and have changed that can mitigate the situation,” Mr. Owens said in the letter.
‘Catastrophic’ Layoffs Ahead For District
Survey: Philly CFOs Optimistic for 3rd Quarter A whopping 89 percent of local CFOs expressed confidence in their company’s growth potential for the quarter, with 34 percent saying they were very confident, according to the Philadelphia Professional Employment Forecast from Robert Half. Eleven percent plan to add new professional level positions, while 71 percent are simply maintaining and plan to hire if any positions open up.
Describing it as “nothing less than catastrophic,” Superintendent William Hite announced last week that close to 3,800 school district personnel were served with layoff notices. This includes 127 assistant principals, 676 teachers, 283 counselors, 1,202 noontime aides, 307 secretaries and 769 supportive services assistants. “Without them, our schools will be just empty shells,” Superintendent Hite said in the released statement. “I am doing everything in my power to prevent this budget from becoming a reality on July 1.” Superintendent Hite points out that many “drastic steps” were taken over the past year and a half for the district to simply stay afloat, including borrowing $300 million, closing 30 schools, lowering wages, cutting programs and reducing central office staff. “The reality is that if we had not done these things , our outlook would be even bleaker,” Superintendent Hite said. The School Reform Commission adopted a budget last week that provides for one principal and a core group of teachers. Counselors, librarians, art and music teachers, secretaries and support personnel can expect to be laid off. Superintendent Hite said those being laid off “are more than numbers. These are people — professionals — who play important roles in the lives of thousands of students throughout our city.
“They often do jobs beyond their titles and employee classifications. They are teachers, counselors, friends, protectors, and mentors to the children of Philadelphia.” One response to the anticipated layoffs has come from the Teacher Action Group, which has launched FacesOfTheLayoffs. org, a website that encourages staff and community members to submit photos of those affected. It also provides information for those who wish to contact politicians about the cuts. If the District is able to close in on the $300 million gap, some layoffs could be rescinded. “We do not anticipate more clarity until city and state budgets are passed and negotiations end with our labor partners,” Superintendent Hite said. “We want to give as much notice as possible so that employees can explore their options and our schools can make adjustments.” Mayor Michael Nutter released a statement last week when the budget was passed asking for support for the creation of a cigarette tax while raising the liquor tax. The Daily News reported that Mayor Nutter was traveling to Harrisburg this past Tuesday to build support for his plan. The alcohol increase would generate an estimated $22 million more while the cigarette tax would raise $45 million for the schools.
“Manufacturing, pharmaceutical and medical device companies continue to drive hiring in the Philadelphia area,” Lori Hourigan, regional vice president for Robert Half in Philadelphia, said. “We’re seeing businesses expand their staffing levels to take on more projects and position themselves for growth.” Though the future, at least into the 3rd quarter may look bright, there are still obstacles when it comes to hiring. Fifty-three percent of CFOs who were surveyed said it is at least somewhat challenging to find skilled candidates for professionallevel positions. And 15 percent don’t plan on doing any hiring at all, even to fill an open position, which is up from 9 percent in the second quarter. Another two percent of those surveyed say they plan to reduce staff, which is down from three percent in the second quarter.
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CHOP Named Nation’s Best For Child Care Children’s Hospital of Philadelphia has been named the best children’s hospital in the country, according to the U.S. News and World Report’s seventh annual Best Children’s Hospital rankings. Last year, CHOP was tied with Boston Children’s Hospital, which came in second for 2013-2014. The hospital was one of 87 facilities that made the rankings in at least one of the 10 specialties analyzed. It is ranked No. 1 for pulmonology and urology, No. 2 for orthopedics, gastroenterology, GI surgery, diabetes, endocrinology, cardiology and heart surgery and No. 3 for cancer, nephrology, neurology and neurosurgery. FINANCE
Local Bank Opens South Philly Branch Valley Green Bank CEO Jay Goldstein, along with Mayor Michael Nutter, held a ribbon-cutting ceremony Friday for the new Valley Green Bank branch at 1536 South Broad Street, at the corner of South Broad and Tasker streets. At the ceremony, Mr. Goldstein pointed to the entrepreneurial community in Philadelphia as one of the main reasons Valley Green Bank will be lending to small businesses during difficult financial climates. See page 26 for a Q&A with Mr. Goldstein about the opening and Valley Green Bank’s lending process. ENERGY
Smart Meters to Stay Opting out of smart meters is not up for debate in Pennsylvania, Robert Powelson, chairman for the Pennsylvania Public Utility Commission, said at a recent Chamber of Commerce event. Mr. Powelson said concerns over loss of privacy and government collecting data were unfounded. “Whether you like it or not,” he said, “you’re getting a meter.”
Lawsuits, Arrest, Hearings: Fallout from the Collapse
Fed: Philly Growth Steadily Improving Residential construction, retail sales, services, staffing services and tourism are all showing gradual signs of strength, according to the Federal Reserve’s latest Beige Book survey.
A fatal building collapse at 22nd and Market Street June 5 has left the city of Philadelphia reeling. In the wake of the tragedy that left six dead and 14 injured, Philadelphia District Attorney Seth Williams announced a grand jury investigation on Monday, the Inquirer reported. City Council President Darrell L. Clarke called for hearings and a probe into procedures surrounding construction, demolition, licenses and permits and certification of staff. They said it would do more than point out individual failures at the demolition site, but get to the root of systemic weakenesses in the city’s regulation and inspection of demolition sites. Mr. Williams said the probe would be exhaustive and could lead to criminal charges. Mr. Clarke said a new council committee would hold hearings over the summer, write a report and possibly draft legislation to correct the problems. Mayor Michael Nutter has spoken up as well, apologizing June 7 for the tragedy that occurred while promising to find out what went wrong and hold those responsible accountable. Mayor Nutter addressed the city’s shortcomings involved with the collapse: Allowing an unqualified contractor with a criminal history and inadequate insurance to use unqualified workers and heavy equipment to tear down a building looming over a busy store without bracing walls or protecting those nearby. Mayor Nutter said he would ask council to pass a bill requiring separate licensing, background checks and drug screening for demolition workers.
Patrick Gillespie, business manager of the Philadelphia Building Trades Council, offered to assemble a “construction and demolition advisory committee,” consisting of safety experts from Local 98 of the electricians union and the Laborers District Council for no charge. The committee would bring union safety experts together with city agencies charged with monitoring construction and demolition sites. Meanwhile, the excavator operator, Sean Benschop, turned himself in to police on Saturday, though he refused to give a statement to police. According to a toxicology report, Mr. Benschop has marijuana in his system at the time of the incident. Mr. Benschop has been charged with six counts of involuntary manslaughter, 13 counts of recklessly endangering another person and one count of risking a catastrophe. Several lawsuits are being filed against Richard Basciano, the owner of the building that collapsed. One of the plaintiffs is Felicia Hill, the Inquirer reported, a mother of seven who detailed her escape to reporters at a press conference Monday. “I started running for my life, and all I could think about was my children,” Ms. Hill said. Attorney Robert Mongeluzzi is representing Ms. Hill and five other plaintiffs, along with other co-counsels. Other victims in the collapse are expected to file suit as well. In an interview with the Inquirer last year, Mr. Basciano said he had hopes to revitalize that area, calling it the “gateway to Philadelphia’’s Market Street West.”
“After many months at a generally more modest pace of growth, aggregate business activity in the Third District [Philadelphia] has accelerated somewhat to a moderate pace of growth during this current Beige Book period. “In particular, the growth rate of residential construction, general retail sales, general services, staffing services, and tourism appears to have accelerated somewhat from a more modest rate of growth to join auto sales and existing home sales at a moderate growth rate. “Commercial real estate leasing continued to expand at modest rates, while commercial real estate construction continued to expand only slightly. “Manufacturing appears to have declined somewhat after expanding slightly last period. “Loan volumes at Third District banks resumed growing slightly across most categories, while credit quality continued to improve. “General price levels, as well as wages and home prices, were reported to have increased slightly overall — similar to the last Beige Book period.”
13 JUNE 2013
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@BenjaminsDesk Whether you’ve been to its physical location or not, the Twitter account behind this Center City coworking space is a must-follow. Not only will it inform you of special events, like the recent OpenAccessPhilly, but it also takes the time to introduce new companies that use its space. RT @BenjaminsDesk: Check out one of our new members @LifeVestHealth the stock market of health! RT @BenjaminsDesk: Meet authors @alizasherman & @daniellesmith at our #coworking space 6/28 5-6:30pm
77 Instant-Action Ideas to Boost Sales and Profits Whether you hate it or love it, successful marketing is one of the cornerstones of running a successful business. David Newman’s Do It! Marketing contains 77 actionable marketing ideas that both entrepenuers and established marketers can utilize quickly. Newman has more than 20 years of experience with marketing and the technologies it intersects with. One Amazon reviewer claims, “Each of the 77 chapters is an easy read and the exercises are concrete. If you did one chapter a day for 77 days, your business would be at a whole new level in just a few months.”
Onavo Extend The age of unlimited data is quickly evaporating, which means keeping track of 3G and 4G data will be just as important as keeping track of minutes and texts. Enter Onavo Extend. The free app, available for iPhone and Android, has been proven to extend data plans up to 500 percent by compressing apps’ data usage when on 3G or 4G networks. Onavo Extend gives monthly usage reports, showing which apps are using the most data and how much you’re saving with the app’s compression. Very useful if you’re on a limited data plan.
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New Bryn MawrBased Food Truck Hitting U.S. Open Bryn Mawr’s Verdad Restaurant & Tequila Bar, 818 W. Lancaster Avenue, has launched its new lunch food truck, which will serve Latininfused tapas. And just in time for the U.S. Open. The food truck will be rolling up and down the Main Line, making a point to stop in Merion, as well as at summer festivals and Villanova football games in the fall. The menu will include beef tacos, flash fried mahi mahi, pork carnitas and pork cheek, which is served with pickled tomato relish and served on a hard shell corn tortilla.
13 JUNE 2013
IRS Scandals Reveal Obamacare Weaknesses
Charlie Gerow is CEO of Quantum Communications, a Harrisburg-based public relations and issue advocacy firm. CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
As scandals continue to roll out of the IRS a question is: How can an agency so incapable of policing itself be trusted to implement and oversee Obamacare, the most massive social policy and tax program in history? How can an agency whose credibility is shot be handed control over 15 percent of the nation’s economy under Obamacare? The Constitutionality of ObamaCare was upheld not based on the Commerce Clause as the Administration asked and argued, but on the Congress’ power to tax. Not only is the IRS implementing Obamacare, it is engaged in another power grab that is as chilling as any of their recent overreaches. We reported in this column six months ago that, “There’s a dirty little secret in this: The subsidies, at least according to the statute, only apply to exchanges set up by the states.” The subsidies we referenced are tax credits and subsidies specifically referenced in the law as being for those states that created “exchanges.” Pennsylvania and 25 other states chose not to set up the exchanges. Seven others started
“hybrids” with the federal government. The law allows the Department of Health and Human Services to create exchanges for those states. But it doesn’t make provisions for the accompanying subsidies. Without the subsidies employers and many individuals would not be subject to the mandates of Obamacare. Without them the whole scheme would fall under its own weight. Enter the IRS. Between singling out specific taxpayers and organizations because of their beliefs, invoking the Fifth Amendment in Congressional testimony, displaying alarming cases of amnesia and spending the taxpayers money on ridiculous line dancing videos and lavish conferences they determined that they had the power to simply provide the credits. Their determination is a “reasonable interpretation,” they say. “Not so fast,” legal scholars and interested parties have said. The IRS ruling is being challenged in court. At issue are hundreds of billions of dollars in subsidies as well as additional penalties to individuals and businesses in the 33 states that have not
created their own exchanges. On the side of the plaintiffs is both the statutory language and legislative history and intent. The Congressional Research Service says Halbig v. Sebelius “could be a major obstacle to the implementation of [Obamacare]. “All of Obamacare hangs on the outcome,” said George Mason Law Professor Michael Greve. The case also raises the question of congressional action. While the House once again voted to repeal Obamacare last month, there aren’t votes in the Senate to repeal. But Congress should re-examine the law even if there aren’t enough votes (yet) to repeal it. At its core Obamacare is an unmanageable mess that increases costs instead of lowering them, puts additional burdens on Medicaid, and is bound to cost Americans their jobs and standard of living. The most recent twist shines a light on how badly drafted Obamacare really is. Now that we’ve had just a glimpse of what a house of bureaucratic cards it is, it’s time to start over— especially when that house of cards is being held together by the IRS.
We’re here to honor the brave patients, doctors and advocates who face health challenges every day. But let’s not forget their brave caregivers. Shire established the BRAVE Awards to celebrate the unsung heroes of healthcare: non-professional caregivers. This year’s recipients will be announced in November.
To learn more, go to ShireBRAVEAwards.com.
13 JUNE 2013
Council Committee To Investigate Fatal Collapse
Timothy Holwick is a freelance writer covering Philadelphia government. Find more coverage at citycouncilmatters.com. CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
On Monday, June 10, 2013, Philadelphia City Council President Darrell Clarke announced the formation of a special investigative committee which will examine the procedures, permits, licenses and regulations for building demolitions. The special committee will also examine the certification of workers and building maintenance. The building collapse in question occurred at 22nd and Market Streets last week. The incident took the lives of six people, as well as injuring 13 others. A response to the collapse is coming from all sectors of Philadelphia government, with commitments to investigate the causes, as well as promote stiffer oversight in the future coming from officials like Mayor Michael Nutter and District Attorney Seth Williams. Council President Clarke expressed that the committee will be seeking to enact legislation that will create tougher standards for building maintenance and demolition safety. The committee will be armed with subpoena power in order to investigate the
MEMBERS OF CITY GOVERNMENT ARE EXPECTED TO ANSWER THE CALL AND ENSURE A TRAGEDY LIKE THIS BECOMES LESS LIKELY IN THE FUTURE’ circumstances surrounding the building collapse and discover where legislative action might make the most difference. That will be the extent of the investigation, as District Attorney Seth Williams has already spoken about the assembly of a grand jury to begin the criminal investigation into the deaths, injuries, and property destruction that occurred on Market Street. Council members joining Council President’s Clarke new committee include Councilman Jim Kenney and Councilman Curtis Jones, Jr. Along with Councilman Clarke, these Council members spoke about finding out the root causes of unsafe construction, and how safety could once again be placed
ahead of cost-saving. Council is set to approve the City’s operating budget on Thursday, but the attention toward investigating the causes of the building collapse might push more funds into the City’s Department of Licenses and Inspections (L&I). Whatever investigations or legislation are planned for the future, prevention will likely start with L&I. Particularly, prevention of another incident will begin with resources at L&I, along with stricter standards for them to apply to suspect worksites. Council will soon begin its summer recess, so this committee may be required to meet during that period if they hope to draft timely legislation. Other members, in addition to Councilmembers Clarke, Kenney and Jones, have expressed a willingness to get involved. With so much public attention toward this disaster, all members of City government are expected to answer the call and ensure a tragedy like this becomes less likely in the future.
13 JUNE 2013
Time Running Out For Latest Liquor Proposal
Eric Boehm is bureau chief for PA Independent, a project of the Franklin Center for Government and Public Integrity
CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
There will be two competing liquor reform proposals in the General Assembly soon, with only a few weeks for lawmakers and Gov. Tom Corbett to reach an agreement before the June 30 budget deadline. Not that they absolutely have to reach a deal on changing how Pennsylvanians buy liquor, wine and beer before June 30, but Gov. Corbett and House Republicans have made privatization of liquor sales a major priority this year and seem unwilling to pass another state budget without hitting that goal. After sitting on the sidelines for months, the Senate soon will unveil its own liquor plan to compete with one passed by the House. The new Senate plan is being crafted by state Sen. Charles McIlhinney, R-Bucks, chairman of the Senate Law and Justice Committee. The senator says he does not want to create new licenses for privately-owned liquor stores, but would prefer to give all existing licenseholders (bars, restaurants, beer distributors and those few grocery stores that are selling beer with a restaurant license) the ability to expand their sales by upgrading to a license that would allow them to sell wine, liquor and beer in the same location.
What does that mean for consumers? Onestop shopping for alcohol, at last. Sen. McIlhinney took plenty of criticism from liquor privatization advocates for dragging his feet on the process. The state House passed the bill in March, but Sen. McIlhinney decided to hold a series of three hearings spread out over seven weeks that carried the process into early June. Now, he says he is working on his own liquor reform proposal that will be an entirely different vehicle from what the state House has passed — and it will be another week before he makes it public. Some will certainly see this as another round of stalling tactics from a senator who has never been all that excited about privatization. But give Sen. McIlhinney the benefit of the doubt for now. If his plan does what he says it will do, it may end up being a better product than what the House spent the past two years trying to craft. Under the House plan championed by Majority Leader Mike Turzai, R-Allegheny, there would be privately-owned liquor stores, but only beer distributors would be granted the right to sell wine, liquor and beer in the
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same location. Grocery stores would be limited to wine only (and beer in certain circumstances), while liquor stores would be for wine and hard alcohol only, as they currently are. Sen. McIlhinney criticized the House plan last week for being little improvement on the current system. There are drawbacks to his proposal too — not least of which is that it would keep the Pennsylvania Liquor Control Board in place as the sole wholesaler of alcohol in the state and would keep the state-owned-and-operated liquor stores open. If those setbacks are enough to undermine union opposition to changes to the state’s liquor laws, most consumers probably would be happy with the end result. Full privatization would be left for another day. But the major roadblock is Rep. Turzai, who said last week any state Senate plan would have to be “substantially similar” to his Housepassed bill. He declined to elaborate on what that means for the upcoming negotiations. Sen. McIlhinney’s plan will be made public next week. By the end of the month, hopefully, we’ll finally see some changes to the arcane world of Pennsylvania’s liquor laws.
13 JUNE 2013
2013: YEAR OF THE INNOVATOR
Getting to the Heart of Workplace Safety
John Ehinger is CEO of CardioReady, a suburban Philadelphia company, which offers organizations turn-key preparedness and training solutions aimed at improving survival from Sudden Cardiac Arrest. For more information, visit www.cardioready.com.
CONTRIBUTE Send comments, letters and essays to feedback@ regionsbusiness.com. Opinions expressed by guest writers do not necessarily reflect those of Region’s Business.
ire and natural catastrophe. Equipment maintenance. Terrorism. When considering workplace safety, these are at the forefront of Risk Management, Human Resources and Loss Prevention professionals’ minds, as they work to minimize workers’ compensation and health care loss costs as well as meet the standards of the Occupational Safety and Health Administration and the Fair Labor Standards Act. Although these traditional safety measures are important, many risk and safety professionals are also addressing what their organizations should do when it comes to the leading cause of death in the United States — Sudden Cardiac Arrest (SCA). Although SCA is often overlooked in workplace safety and preparedness planning, it accounts for 300,000 deaths annually in the U.S. It is crucial for safety and risk professionals to recognize this major health problem and the risk that it poses to their employees and their companies. Equally, it is imperative to plan for it with the same discipline that is exercised to address fire, earthquake or other catastrophes. The issue of preparedness for SCA in the workplace — where Americans spend the majority of their daily time — is a critical one. When SCA occurs, heart function abruptly stops, no longer pumping blood to the rest of the body. Unlike a heart attack, which is caused by a blockage, SCA usually occurs without any warning symptoms, making the condition especially frightening and the exposure quite volatile.
While the risk of SCA increases as we age and is also influenced by overall health levels, it can strike anyone, anywhere, at any time. Despite these grim facts, what is clear is that the prompt deployment of safe, easy-to-use Automated External Defibrillators (AEDs) saves lives. In fact, if an AED is used within the first three minutes of an SCA emergency, it can increase the rate of survival from the 8 percent national average to more than 70 percent. This positive statistic alone should compel risk, safety and loss prevention professionals to take a closer look at planning and preparing for an SCA emergency in their organizations, particularly considering prevailing demographic trends — both age and health related. Similar to implementing an emergency evacuation route or traditional disaster recovery plan, implementing an SCA response strategy is the ultimate Wellness Program and can avoid a catastrophic outcome for a company’s most valuable and valued asset: its people. For employers, there can be nothing more important than the health and safety of their employees, guests and customers. Installing preventative measures to address SCA risk is comparatively easy and inexpensive. It isn’t just about fire extinguishers or first aid kits anymore. The heart of workplace safety in the 21st century now includes AED availability and the knowledge to use them in an emergency situation. This extension of planning and preparedness can make all the difference in saving a life.
Steadily, but almost quietly, Philadelphia has become a hotspot for entrepreneurs. The combination of great ideas, available capital and a welcoming environment have set the stage to make 2013 a breakout year for innovation and new businesses. To Learn More ... For more information on sponsorship opportunities or to suggest story ideas, call our main office at 610-940-1656. The web: RegionsBusiness.com Facebook: Facebook.com/regionsbusiness Twitter: @RegionsBusiness Sponsored by
13 JUNE 2013
2013: YEAR OF THE INNOVATOR
PACT Foundation Luncheon Honors Tech Girlz Group The PACT Foundation annual luncheon, held last week, welcomed Philadelphia Eagles president Don Smolenski and recognized local startups and education programs supported by the organization. One such organization, the nonprofit Tech Girlz, is working locally to introduce adolescent girls to technology through workshops and events in hopes of bridging the gender gap between women and science, technology, engineering and mathematics careers. PACT donated financially to help produce a summer camp presented by the organization. “This isn’t just a social justice issue anymore. For those of you with trouble hiring technology workers, this is now an economic issue,” founder Tracey Welson-Rossman told those in attendance. ”It’s not just about supporting women in technology… it’s really about how we are going to continue to expand our region and the innovation going on.” BROOKLYN TECH MEETUP
Four Brooklyn Startup Companies Showcasing in Philly Tuesday, four Brooklyn startups will hop on a train headed for Philly. They’re coming to present their ventures and share their startup experiences with a local crowd of investors, entrepreneurs and technologists. “Demoing in Philly allows two great cities to combine the best of our attributes and help each other out in the overall goal of creating entrepreneurial value,” said Jason Struhl, coorganizer of Brooklyn Tech Meetup, the group with which Technical.ly Philly is partnering on the event. In the spirit of collaboration, join Technical. ly Philly and Brooklyn Tech Meetup June 18 at 6:30pm at First Round Capital to hear unique perspectives from our friends on the other side of Jersey. It’s free, there will be pizza and beer and you can get a sense of what’s happening in the Brooklyn startup scene. (Technical.ly Philly organized a similar event with friends from Baltimore.) This article was originally published by Technical.ly Philly at TPhilly.com.
Happenings Media Stays ‘Ruthlessly Efficient’
L-R: Vanessa Royce from Berks Happening; Christy Gallagher from Philly Happening; JC Sager from Montco Happening; and co-founders Angela Giovine and Tina Paparone. SUBMITTED
In her latest “Diary” entry, Happenings Media co-founder Tina Paparone mulls over what to do with an overloaded small-business to-do list, as well as teases what’s to come with Happenings Media. In her own words: Can you believe we’re almost halfway through the year? Time flies in the hectic world of entrepreneurship. Speaking of time, there never seems to be enough of it when it comes to growing a business. That’s why in June, we revisited our 2013 annual goals to see how we’re progressing. Business owners have a million responsibilities, so maintaining focus and prioritizing tasks is a huge challenge. The to-do list is never ending, and it can be easy to give yourself excuses for missing targets. So how do we stay on track? Borrowing the words of Happenings Media cofounder Angela Giovine, it’s about being “ruthlessly efficient.” If an activity is not contributing to our day-to-day operations or growing the business in a way we’ve outlined in our annual goals, it’s not generally a priority. Extreme? Yes. But growing a business from one to 20 digital magazines in less than two years requires extreme focus and dedication. Be on the lookout for several new Happenings Media initiatives launching in the coming months, including “Happening List” competitions on Grand Strand Happening, Ocean Happening and Nassau Happening in addition to a new Happening magazine launching in a nearby county!
DIARY OF A STARTUP
IF AN ACTIVITY IS NOT CONTRIBUTING TO OUR DAY-TO-DAY OPERATIONS OR GROWING THE BUSINESS IN A WAY WE’VE OUTLINED IN OUR ANNUAL GOALS, IT’S NOT GENERALLY A PRIORITY. EXTREME? YES.’ —TINA PAPARONE
Science Center Accepting Nominations for Innovators Walk of Fame As part of its 50th Anniversary Celebration, the University City Science Center is accepting nominations for its inaugural Innovators Walk of Fame. The Innovators Walk of Fame will commemorate and celebrate the Greater Philadelphia region’s dynamic history of innovation and the trailblazers who continue to invent the future. The Science Center’s Innovators Walk of Fame will showcase individual innovators in the STEAM sectors of Science, Technology, Engineering, Art and Math, as well as a Corporate STEAM Champion. Categories include: Science – recognizes demonstrated innovation in the sciences Technology – recognizes demonstrated innovation in technology Engineering – recognizes demonstrated innovation in the field of engineering Art – recognizes demonstrated innovation at the intersection of art and technology Math – recognizes demonstrated innovation in the field of mathematics, including finance and economics Corporate STEAM Champion – recognizes a company that has demonstrated support of STEAM subjects in the schools or community All nominees must have a connection to the Greater Philadelphia region. To submit a nomination, visit www.sciencecenter. org/50th/iwof by June 15.
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2013: YEAR OF THE INNOVATOR
GoodCompany Group Announces Wilco Electronics On Bringing 2013 Summer Accelerator Class Focuses Tech To Classrooms BY JULIANA REYES
oodCompany Group announced the 11 companies in its summer social enterprise accelerator. The companies come from New York City, San Francisco, Pittsburgh, Philadelphia and Ecuador, and several are local companies focused on edtech. This is the first class of entrepreneurs that will by vying for a slice of funding guaranteed to this GoodCompany class, thanks to a $500,000 investment pledge from Investors’ Circle. This class will also be an early test case for the Philadelphia Social Enterprise Partnership (PSEP), the $1 million Bloomberg Philanthropies-funded initiative that aims to incubate companies that can address the city’s problems. This means that the GoodCompany entrepreneurs will have special access to the City of Philadelphia and the Wharton Social Impact Initiative, with an aim of more fully integrating the program in the future. PSEP will put out a call for companies to join its incubator this fall, said Jeff Friedman, co-director of the Mayor’s Office of New Urban Mechanics, another partner in the PSEP. Three of the companies in this summer class are local edtech startups: Slate, the year-and-ahalf-old spinoff of the Northern Liberties web dev team Jarvus; Knick Knack Learning, the recently launched low-cost tablet from Fort Washington’s Wilco Electronic Systems and Professor Word, a browser-based vocabulary tool that launched in beta last summer. One unique member of the summer class is Center City’s Here’s My Chance, which is not a traditional startup and rather a marketing firm founded by young David Gloss, who has taken a fancy in the intersection of nonprofits and investment. Here’s My Chance is the team behind the Philly DoGooder video promotion project.
BY BRANDON BAKER
The Mayor’s Office of Urban Mechanics (Jeff Friedman and Story Bellows) will work with GoodCompany Group’s class as part of the Philadelphia Social Enterprise Partnership. GOODCOMPANY
Below, a list of the local companies with descriptions provided by GoodCompany Group: Slate improves data in schools through an open-source platform that links together all the systems schools and students use to support and manage learning. Slate captures every communication, interaction, draft, decision, collaboration, reflection and evaluation to support and track students’ entire learning process in context. With access to the complete set of data about the entire learning process, students and teachers can better evaluate progress and improve skill based outcomes. ProfessorWord will integrate online reading and vocabulary learning into a seamless experience. Students are tired of reading stale content and memorizing wordlists. Currently in development, ProfessorWord crawls the web to find interesting high-quality readings that can be customized for students based on subject, reading ability, and vocabulary level. Our tools help students engage and learn words in context while they read: they click words to get definitions, annotate the article, and save words to an account to create personalized flashcards and review tests. Student performance is recorded
on a secure dashboard, accessible by teachers and parents. Here’s My Chance is a “creative agency for good” working with nonprofits and corporate brands to rally massive communities around important issues and causes. Founded by David Gloss and Kevin Colahan in 2011, Here’s My Chance campaigns have raised over $3 million for clients activated over five million people to take an action on behalf of a cause. Knick Knack Learning bridges the gap between schools and their need for greater access and exposure to educational technologies by seeking strategic partnerships with innovative educational content and technology providers, converting their products into an app-based user experience, providing assessment and tracking of content products through user generated data, and actively targeting schools that could benefit from these offerings. Through individualized instruction and a focus on academic improvement and enhanced classroom experience, Knick Knack and the tablet “The Knack,” is uniquely positioned to help learning intuitions address the multiple challenges existing in urban education. This article was originally published by Technical.ly Philly at TPhilly.com.
Wilco Electronic Systems, Inc., may be a cable company first and foremost, but don’t count it out as just another fledgling subsidiary of Comcast — it’s proven to be a much more substantial example of deviating from the cable-services status quo. Founded in 1977 by Will Daniel, who is still CEO of the company, Wilco prides itself in providing cable access to low-income, multi-dwelling units in the Philadelphia region. So much so, in fact, that after selling to Comcast in 1998, it put a sizeable chunk of its newfound funds into a private network for the Philadelphia Housing Authority. Today, Executive Vice President Brigitte Daniel said the company’s primary objective is to broaden its horizons as more than just another cable provider. “When I got on board in 2006, I realized we are no longer in 1986, and I wanted to change the focus from being a cable company to a technology company,” she said. “Because really, that’s what cable is today. “Now, it’s phone, it’s internet — so we’re using our reputation of being a provider of new services and offering diversified services by making different partnerships.” Its latest foray into diversifying is the launch of its tablet pilot program, Knick Knack Learning — an educational technology company intended to provide affordable tablets to an initial round of five charter and public schools in Philadelphia. The program, which includes specially-developed software for evaluating student performance and teacher-student facilitation, will engage 200 fifth and sixth graders. “I received an Eisenhower fellowship where I traveled all throughout South Asia, India and Sri Lanka to look at emerging technologies that might benefit my marketplace here in Philadelphia. And so through this trip, I serendipitously came across low-cost tablets being used in parts of India and South Asia that needed easy-access tablet technology,” Ms. Daniel said. “From that trip, I said, ‘Wouldn’t it be great to come back to the U.S. with this tablet and test it out with a pilot?’” And so she did. Ms. Daniel is also CEO of the Knick Knack Learning project, which partnered with University of Pennsylvania for development and implementation. Results from the pilot program are expected to surface in the fall. “What we want to do,” she said, “is provide the best for those who have the least.”
2013: YEAR OF THE INNOVATOR
13 JUNE 2013
SpeSo Health Program Helps Those With Rare Diseases own personal connections to rare diseases and the untapped business potential of a field of patients who, in all actuality, are valuable resources for hospitals. “The patient with a condition — CorBY BRANDON BAKER dova, for example — is charged, on average, about $110,000. There are very few Cordova patients, but for a hospital, It’s a lonely world for those suffering they can produce a lot of revenue,” Mr. from rare medical conditions — or at McEuen said. “They can also produce trileast that’s the impression most are left with. als to bring more money into hospitals. SpeSoHealth is banking on the reality ...And that’s the value we want to be able of the matter: Its all-new aggregate data to bring and share.” software aims to assist the more than The team is currently developing its 25 million people in the United States analytics system as part of a Dreamit diagnosed with rare diseases and disorVentures incubator program in PhiladelSUBMITTED ders by pointing them in the direction of phia, but Mr. McEuen said the software hospitals and medical professionals most itself is already “fully functional.” likely to be able to treat them — and treat said Jonathan McEuen, co-founder of We want that connection to happen in an Upon launching the product in its SpeSoHealth. “These patients are facing instant, as opposed to five years.” them well. Web- and mobile-app form, he said, Mr. McEuen, along with his co- SpeSo Health would not charge patients “Most people think [getting a rare dis- life-changing decisions all the time, deciease] is a one-in-a-million shot. But our sions that are chronic and permanent, founders Marissa Brittenham and Rajiv searching for medical resources. SpeSo Health is currently focused on platform is designed for seeing them for and one of the biggest struggles they Mahale, all recent graduates of Wharton, what they really are, which is more like a have is finding an expert who is clinically began working on the project about a bootstrapping, but anticipates seeking one-in-10 chance of getting a condition,” experienced based on seeing these cases. year ago, having been inspired by their additional funding in the months ahead. Business: SpeSo Health Founders: Jonathan McEuen, Marissa Brittenham and Rajiv Mahale Contact: email@example.com
MARCUM I N N O VATO R of the Year
AWA R DS October 23, 2013
Is your company a catalyst for change? Have you pushed the boundaries in your industry? Is your innovation helping to boost Philadelphia’s growing economy? Marcum LLP and Region’s Business are in search of Greater Philadelphia’s top innovators, and we want to hear from you. The 1st Annual Marcum Innovator of the Year Awards will honor businesses of all sizes that are pioneering new advancements in the fields of Health/Biotech, Technology, Business Management, and Energy. Three winners will be named in each category, based on company size. Tell us about your break-through innovation and what makes your company a leader in our region by emailing a 500-word summary to firstname.lastname@example.org. Submissions must be received by August 9, 2013. Winners will be announced at a Gala Awards Ceremony at the Franklin Institute on October 23, 2013. Don’t miss out on this spectacular opportunity to join our region’s business leaders in recognizing and celebrating the spirit of innovation in and around Philadelphia. For complete details including nomination criteria, please call Jacki Hallinan at 484.270.2715. Ben Franklin may have been Philadelphia’s first and most celebrated innovator, but he did not have a corner on the market. Who knows? You could be Philadelphia’s next Innovator of the Year! For tickets to the event, please call 610-572-7112 ext 102. If you are interested in sponsoring this event, please call Deirdre Affel at 610-572-7136. Marcum LLP is a top national accounting and advisory services firm.
International Member of Leading Edge Alliance
13 JUNE 2013
‘NEW AMERICAN’ ON APPROACH A likely — but not guaranteed — merger between US Airways and American Airlines would create the world’s largest airline with more than 500 daily departures out of Pennsylvania, but one organization claims the merger would lead to job cuts, fewer options and increased ticket prices. STORY BY GEOFF PIERRET ILLUSTRATION BY DON LEE
he fast-approaching “New American” — a merger of American Airlines and US Airways that has been circling the runway since midFebruary — would mark the latest in a number of mergers in the airline industry over the last decade, but it would have a greater impact on the industry than has been seen in years. Currently, American Airlines and US Airways are two of the nation’s five largest airlines (United, Delta and Southwest round out the top five). Their combination, however, would land them in the top spot as the United States’ largest airline, in terms of millions of passengers carried, over the current first-place holder, Delta Airlines, who merged with Northwest Airlines in 2010. There are those in favor of the likely merger and those opposed, of course, but all agree this merger would mean many changes for the airline industry.
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WE’VE COMBINED TO CREATE AN AIRLINE THAT CAN COMPETE AGAINST [UNITED AND DELTA]...SO IT’S MORE COMPETITION, NOT LESS’ — US AIRWAYS CEO DOUG PARKER
The bankrupt American Airlines would be raised out of the hole with the help of US Airways, a company that has recorded net gains in the recent past, a feat not every airline can boast. Naturally, passengers and investors alike have been asking a number of questions about the conceivable results of the merger — Which airports will be cut out? What will happen to frequent flyer miles? Who decides which employees will stay? — but what the airlines have asked concerned parties to remember is, firstly, that this is still a potential merger, and more will be revealed as things unfold. Certainly, nothing shall be written in stone until the merger is finalized. Knowing its consumers and constituents are frustrated, the potential new American Airlines has sought to answer many of these questions. They have not, however, been quick to get into too much detail. Both American Airlines and US Airways have released a series of Frequently Asked Questions and responses, yet they have avoided much further press communication. Even Philadelphia International
Airport (PHL) officials declined to respond to requests for details regarding the merger’s potential effect on Philadelphians in particular. As it stands, the potential merger is not only a hot topic among the millions of travelers who fly each year, but also a sensitive subject to the airlines and airports involved. And the situation is becoming increasingly polarizing as the months pass. The two airlines have responded to those critical of the potential merger by creating the “New American Arriving” campaign, and a website (www. newamericanarriving.com) that includes maps of their new routes, “State-by-State Benefits,” and positive media responses to the potential, global airline. Today, according to the site, the two individual airlines combine to employ approximately 9,100 people in Pennsylvania. PHL alone currently has 444 daily US Airways departures and 15 American Airlines departures. Seven additional airports from Erie to Allentown will form a combined
network that “will offer improved service through 558 daily departures from Pennsylvania, with access to 336 destinations around the world.” Philadelphia stands alongside Charlotte and Phoenix (US Airways is headquartered in Tempe, Arizona) as one of US Airways’ major hubs, and according to those numbers the city will continue to hold that position. In fact, both American Airlines and US Airways expect to retain all of their major hubs as well as some key players in management. This is just another indication of the immensity of the new American. The potential airline will maintain the headquarters of American Airline’s parent company, AMR, in Fort Worth, Texas (where DFW airport is located), but will count on US Airways’ management team to control most major operations. Current US Airways CEO Doug Parker will run the new airline with American CEO Tom Horton serving as chairman. As for shareholders, the New American Arriving site indicates, “US Airways shareholders will own
28 percent, and stakeholders of AMR Corporation and its debtor subsidiaries will own 72 percent, of the fully-diluted common stock of the combined company.” There seems to be little buzz from the investors’ end, however, and much more from the customers’. The most common questions stem from the notion of a loss of competition. If two of the world’s largest airlines merge, then they will control the market on flights out of many major cities where they currently compete. One of the New American Arriving’s foremost statements, however, is a reminder that the airline industry will always remain competitive. Mr. Parker is quick to back that statement as he explained on CBS This Morning in February, “we’ve combined to create an airline that can compete against the other two airlines that happen to be larger than us right now — United and Delta — to create an airline that can compete strongly against us. So it’s more competition, not less.” Ultimately, the airline plans to boast
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June 10, 2013 Dear American and US Airways Team Members, Today I am pleased to announce the senior leadership team that has been selected to lead the new American Airlines. The team we are naming today is comprised of senior leaders from both American and US Airways. As individuals, they each have outstanding industry expertise and experience. Collectively, they form the best team in the industry. The team will be comprised of: · Scott Kirby: President · Elise Eberwein: Executive Vice President, People and Communications · Bev Goulet: Chief Integration Officer · Robert Isom: Chief Operating Officer and [CEO] of US Airways, Inc. post-close · Steve Johnson: Executive Vice President, Corporate Affairs · Derek Kerr: Chief Financial Officer · Maya Leibman: Chief Information Officer · Will Ris: Senior Vice President, Government Affairs Scott, Elise, Robert, Steve and Derek will join the new American from US Airways. Bev, Maya and Will join from American. I also wanted to let you know that Dan Garton will step down as President and Chief Executive Officer of American Eagle Airlines later this year. We will name a successor prior to Dan’s departure. I could not be happier about this team. They are an intelligent, results-oriented and energetic group who enjoy working collaboratively. They are experienced airline executives who understand and love our business. They care about our customers and are dedicated to providing industry leading customer service with an unwavering commitment to safety. They understand they work for the shareholders of the new American and that their job is to reward the shareholders’ confidence in all of us. And…they know that the only way they can accomplish all of those things is by engaging, motivating and respecting the more than 100,000 hard-working team members of the new American. Our job is to support all of you – to give you the tools and information you need to do your jobs and then let you do it as the exceptional and experienced group of aviation professionals you are. This team was built to do just that. Mergers unfortunately result in departures, and there are some on both teams, but I want to use this opportunity to specifically thank some of the outstanding senior executives at American. The American restructuring is far and away the most successful in aviation history and it would not be possible without the exceptional and dedicated work of people like Dan Garton, Bella Goren, Gary Kennedy, Denise Lynn, Jim Ream, Jon Snook and Virasb Vahidi. We are grateful for their phenomenal work and dedication and are committed to building on the foundation they have put in place. It is time to move forward and this announcement is a key step on the path. The merger is progressing well and we continue to expect it will close in the third quarter of this year. We anticipate naming additional officers in the weeks ahead and will have the entire officer team selected by the time the merger closes, if not sooner. Looking ahead, I am confident that the new American will continue to provide great leadership opportunities for managers from both companies. In the meantime, please keep up the great work in support of our customers. I am excited about today’s announcement but even more excited about the years ahead and the opportunity to work with all of you. In fact, I can’t wait to get started. Thank you so much for your support and your commitment to the new American Airlines — we will be one team soon. — CEO Doug Parker
13 JUNE 2013
new travel options, greater efficiency and a number of new destinations. But not all consumers are buying in to this idea. For one, the Consumer Travel Alliance (CTA) has asked flyers to look at things differently. A CTA study claims “40 percent of American Airlines’ connecting routes have overlap with US Airways and 30 percent of US Airways’ connecting routes overlap with American Airlines.” Representatives from US Airways and American Airlines have said that only 12 overlapping non-stop routes conflict between the airlines. The Alliance’s director, Charlie Leocha, has been vocal about his distrust in the airline’s numbers and cites some examples of flight overlap and elimination. Connecting routes especially, he said, are where airlines compete, but obviously these two will end any competition once they’ve merged. Using one of the CTA’s Pennsylvania examples: “A flight from Pittsburgh to New Orleans on US Airways would connect in Charlotte or Denver and the competing American Airlines would connect in Dallas, Miami or Chicago,” according to the report. “The Consumer Travel Alliance study suggests that this does not bode well for consumers as this all but guarantees higher prices between those connecting markets,” Mr. Leocha said in a statement. Philadelphia, as one of US Airways major hubs, has more flights to consider than many cities. Both American Airlines and US Airways currently fly direct from PHL to Miami International Airport. Once the merger is complete, only one of them will, thus granting the new American greater control of the market on flights from Philly to Miami. And from there, it is unknown how the merger will impact ticket prices. With one fewer competitor, other major network airlines will benefit in the long term while the consumer will suffer the costs. With all this in mind, the Consumer Travel Alliance has gone so far as to demand that the Department of Justice examine the CTA’s study results, and that they consider antitrust laws in the decision on whether or not to permit the merger. The airlines have had some quick responses to Mr. Leocha and the CTA’s comments, noting on their website that no substantial evidence indicates that mergers in the past have driven up flight rates. They would like ticket purchasers,
especially high-value customers and frequent flyers, to primarily expect a great increase in “breadth of service.” They focus on the potential positive changes rather than on rising fees or other potential negative results of a merger. This breadth of service is a major factor in the new American’s ability to stay competitive. Returning customers — including American Airlines’ AAdvantage members and US Airways’ Dividend Miles members — are a priority for the airlines and they want to assure their valued customers that they will be taken care of. The rhetoric of the merger’s potentiality is repeated in the frequent flyer discussion, but the New American Arriving campaign explains that “loyalty program members are expected to have even more opportunities to earn
and redeem miles from an expanded global network of routes and partnerships.” Naturally, critics have questions about the frequent flyer plans as well. After all, American Airlines is a member of the OneWorld network, and US Airways is a member of the Star Alliance. After the merger, US Airways customers will lose their holdings with other Star Alliance members including airlines such as Air Canada, Lufthansa and United. The CTA in particular has spoken out on this problem noting that while current American Airlines frequent flyers will accrue the benefits of the added US Airways destinations, US Airways customers will lose destinations as their connections with American Airlines will be fewer than their connections with Star Alliance members like United. This is just another topic to be
added among the “remains to be seen” list as the airlines have repeated that they will be increasing their destinations with a merger. And it seems the “remains to be seen” list is longer than either side of the pros and cons of a merger. Too much remains up in the air. And, as the New American Arriving campaign continuously points out, this is still a potential merger. It seems both sides are comfortable with that terminology, even if for different reasons. The airlines like to use the term “potential” in order to remain neutral on topics like union impact. They certainly don’t want to make any promises they can’t keep, so they refuse to answer many questions by simply responding, “We’ll tell you more when we know more.” Neither they nor the airports want to discuss the possibility of putting employees out of work or the chance that they’ll lose destination cities. While they mention “improved compensation and benefits for employees,” they don’t respond when asked who those employees may be. Right now American Airlines employs more than 80,000 people to US Airways’ 38,000, and their FAQs indicate the potential for a combined fleet will lead to combined personnel as well. The CTA, on the other hand, likes the term “potential” because it maintains hope that the merger will fall through. Their pressure on Washington to consider antitrust laws shines a light on the impact this merger could have on the traveler’s wallet. Whether for business or pleasure, millions of Americans fly every year both domestically and abroad, and the Consumer Travel Alliance believes the consumers will be choked by the control over pricing that the airlines will soon possess should the merger pass. One fewer airline means one fewer competitor. Simply put, when the major five become the major four, travelers will have one fewer option, and airlines will have one fewer ticket price to beat, or one fewer customer service department to surpass in hospitality. Does eliminating one more airline make things more simplistic for the consumer? Or does it create less competition and lead further towards a tightly fisted airline industry that can raise the rates on tickets as well as baggage fees and other travel-related costs? Geoff Pierret is a freelance writer living in Boston, Mass.
13 JUNE 2013
FINE ESTATES PREVIEW
Moorestown Home Offers Privacy, Luxury This extraordinary home contains top-ofthe-line appliances, including two sub-zero refrigerators, two Bosch dishwashers and a Dacor double wall oven with warming drawer. The gourmet kitchen is complete with granite countertops, Jerusalem limestone floors and a butlerâ€™s pantry. The family room is perfect for entertaining with two flat screen TVs and an oversized antiqued cast stone fireplace with slate and hearth. The master suite includes his and herâ€™s custom built-in closets and armoires, Schnobeck Crystal lighting and a gas fireplace in Louis XV style white Italian marble. The master bath completes the suite with marble floors and countertops and a marble bath. Backyard contains an in-ground pool and blue stone patio. The 1800 sq. ft. finished basement is complete with gym and temperaturecontrolled wine room. Location offers privacy, yet ideal for commuting to Philadelphia and New York City. For more information, please contact Missy Giannetto of Coldwell Banker Preferred at (267) 972-2857.
13 JUNE 2013
Blatstein At ThinkFest: â€˜No Other Place To Investâ€™ BY SANDY SMITH
art Blatstein remains bullish on Philadelphia, warts and all. And why shouldnâ€™t he? Itâ€™s been very good to him so far, and he sees no reason why the good times wonâ€™t continue. â€œPhiladelphiaâ€™s a sleeper,â€? he told the audience who braved the evening deluge to hear the principal and CEO of Tower Investments chat with Philadelphia editor Tom McGrath at The Barnes Foundation as part of the magazineâ€™s Thinkfest Salon Series. â€œIf anyone has any disposable income, buy real estate. Iâ€™ll tell you where to buy.â€? Mr. Blatstein has done quite well buying and developing real estate over the course of some 35-odd years in the business, and he discussed his projects, his approach to development and his take on the city in the conversation, which was filled with highly entertaining remarks, as might be expected from a man Mr. McGrath introduced as a â€œrisk-taker,
820 Brushtown Rd, Gwynedd Valley, PA
84 Norristown Rd, Blue Bell, PA 19422
$3.65 M (6005156)
raconteur and visionary.â€? The conversation touched on all of his milestones and major projects, from his very first development â€” the rehabilitation of a trinity on Catharine Street in Queen Village in the 1970s â€” to his current Big Transformative Idea, the Provence casino-resort. It also included a bit of news about a development yet to be announced: the future of the Ortliebâ€™s brewery in Northern Liberties. â€œWeâ€™re going to demolish the large structures because I couldnâ€™t figure out an adaptive reuse for them,â€? he said with a note of regret. â€œIt will probably become residential.â€? As for the Provence, Mr. Blatstein explained that the casino isnâ€™t the most important part of the project â€” â€œItâ€™s only 9 percent of the complex,â€? he said â€” but itâ€™s the element required to make everything else work, much like the anchor store in a strip mall. The casino drives the traffic to the
5 beds | 6 full, 3 partial baths Timeless & Elegant describe this true estate in prestigious Gwynedd Valley. Built by the builder, for the builder, the residence is sited on over 1.5 acres and offers over 11,000 sf of living space. This home was designed for those with the most discriminating taste and an appreciation for fine living.
5 beds | 5 full, 1 partial baths Meticulously maintained, solid built, Philomeno & Salamone estate home offers nearly 6,000 sq.ft. of living space on 3/4 acres w/3 bay garage. Conveniently located on a private cul de sac in desirable Blue Bell,this home was designed to entertain with itsâ€™ custom finishes t/o including newly renovated gourmet kitchen.
restaurants, entertainment and shopping, he explained. And as with his most recent strip mall, the anchor tenant has been moved up off the street to improve its sidewalk appeal. He described the Provence as filling a need for a playground for older adults: â€œThis is an incredible city,â€? he said. â€œWe have great restaurants. We have great places to shop. What we donâ€™t have is nightlife.â€? Of course, anyone who has been to South Street, Old City or events at the Piazza would likely dispute that statement. But, as he noted, â€œat the Piazza, Iâ€™m the old guy there.â€? Mr. Blatstein noted that he did not start out in life with the aim of being a developer. Rather, it was something he stumbled into when pursuing a pre-med major at Temple didnâ€™t quite work out. â€œI got a job at the Philadelphia Housing Authority under Rizzo. My dad knew him and got me a job there. I started out as a scattered-site project manager.â€? It
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936 N Penn Oak Rd, Lower Gwynedd, PA
(215) 641-2727 (office) (267) 419-1454 (direct)
(215) 850-1305 (cell) (215) 999-5817 (fax)
$1.125 M (6196317)
proved to be a good introduction to the real estate business. He did allow that his nearly 40 years in the development business had made him a bit wiser in picking his investments. After successfully redeveloping that Catharine Street trinity, he said, â€œI had money and I knew exactly what to do with it: I invested wisely. I bought a Porsche.â€? Even though he remains bullish on Philadelphia, Mr. Blatstein allowed that itâ€™s a difficult market in which to make a profit. â€œItâ€™s costly to build here,â€? he said. â€œItâ€™s 30 to 50 percent more expensive to build here than elsewhere. Our costs are like New York Cityâ€™s, but New York City has prices and rents that are three times ours.â€? Still, Mr. Blatstein said, â€œThereâ€™s no other place to invest.â€? This article was originally published on the Philadelphia Real Estate Blog at PhiladelphiaRealEstate.com.
5 beds | 3 full, 1 partial baths Tastefully decorated colonial in desirable Polo Club Estates in the heart of Gwynedd Valley. Sited on over an acre, this well positioned, brightly lit home has improvements throughout. Hardwood flooring, custom paint, newly renovated powder & mud rooms along with numerous other finishes that highlight this beautifully maintained home. 4 beds | 3 full, 2 partial baths Sited on a nearly 1 acre wooded lot in popular Penn Oak, this pretty stone colonial boasts nearly 7,000 sq. ft. of living space w/ its full, finished, walk-out basement. This home offers a bright, open floor plan with access to the outdoors from nearly every room. Kitchen w/ Breakfast Room is welcoming and provides access to large, rear deck for easy entertaining.
Blue Bell Office 686 Dekalb Pike Blue Bell, PA 19422
13 JUNE 2013
The President and CEO of Valley Green Bank (center) just opened a new branch in South Philadelphia to be closer to the community.
What’s the elevator pitch for Valley Green Bank? We’re a community bank headquartered in Philadelphia that focuses on the small- and medium-sized business community. We have the expertise of a large bank, but we’re going to give you the attention to the details that you would want from a local bank like ours. What’s your company philosophy? The philosophy is to build our bank around people and relationships. Why was it important for Valley
Green Bank to expand into South Philadelphia? We had a significant customer base already in South Philadelphia, and our customers had asked us to open a branch that would help them get additional services from us. Are there plans to expand more into Philadelphia? We believe that technology has advanced so much since we opened seven years ago that the reality of it is that most of our customers can do most of their banking from their own
offices or homes, so branching has been less important today than it’s ever been. As a result of that, we’re focused less on branching and more on the people we hire that can help either bring in or support the relationships with customers. If a start-up was looking at options for business loans, for example, what reasons would you give them to bank with Valley Green? First, if it’s truly a startup business with very little operating history, quite
often that business will have to look at their personal assets and family and friends to help get that business off the ground. However, once they have been able to establish some history, the huge advantage of coming to our bank is that we don’t approach anything as if it has to be in a particular box and if it doesn’t fit in that box, we therefore are not interested in the relationship. We approach every relationship as unique, and we look at ways in which we can provide sources of financing toward each of our potential customers.
INTERVIEW BY ASSOCIATE EDITOR RICH COLEMAN SUBMITTED PHOTO
13 JUNE 2013
Family Banks: Creating Makers Rather than Takers
Karen R. Wawrzaszek, CFP, CFTA is managing director at Pitcairn, a family office with locations in Philadelphia, New York and Washington DC. More information can be found at www.pitcairn.com and (800) 211-1745.
Most wealth creators have similar dreams for the future: A lasting legacy. Heirs who embrace their values and honor their life’s work. Enduring wealth consistently employed for the good of the family. Above all, they fervently seek to avoid the “shirtsleeves-to-shirtsleeves” paradigm. In a perfect world, we would transfer our wealth, and our heirs would make the same decisions we did to create that wealth, leaving the next generation in an even better position. In reality, our heirs are living a different life at a different time with different choices before them. Not every family member may want to be involved in a family’s core operating business. That doesn’t mean they can’t be part of the family’s legacy. An innovative approach called a “Family Bank” can provide a framework to pass on a wealth creator’s knowledge and values, while strengthening family bonds and facilitating wealth regeneration across multiple generations. Quite simply, a Family Bank can turn heirs into “makers” instead of “takers.” A Family Bank is not a formal bank. Rather, it’s a collection of family members brought together to carry out investments, entrepreneurialism, and/or philanthropy, and may involve different legal structures, depending on a family’s situation and goals. The ultimate goal of a Family Bank is to ensure the family’s continued prosperity by putting together a family team that learns to exercise good judgment and make decisions that express the family’s shared values. A Family Bank aims to inspire all family members to add to the family’s success by contributing their input, their abilities and their knowledge.
One Family’s Success
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I have seen some Family Banks achieve great success and others strive valiantly without quite pulling it together. The greatest success came from a seventh-generation family who achieved excellent results over several decades and exemplifies several critical “best practices” for any Family Bank. Clear vision: This family stated its mission and family “brand” before setting up its Family Bank. They knew how they wanted to be perceived by the community and extended family and were explicit in what they wished to accomplish.
Well-defined participation process: All family members could be equity stakeholders; not all would manage the bank. Those who wanted to participate went through an application and interview process that required them to meet minimum standards and demonstrate applicable education and skills. Evolving leadership: The family set term limits for Family Council positions (composed of individual members elected by the full family to meet regularly and provide governance and guidance). This ensured accountability, encouraged fresh thinking and allowed younger members to become involved, extending the success into future generations. Formal communications: The family’s reporting structure was much like sharing corporate board minutes. All activities of the Family Bank were transparent to all family members, who could then provide feedback to more active participants.
IN A PERFECT WORLD, WE WOULD TRANSFER OUR WEALTH, AND OUR HEIRS WOULD MAKE THE SAME DECISIONS WE DID TO CREATE THAT WEALTH ... IN REALITY, OUR HEIRS ARE LIVING A DIFFERENT LIFE.’ Fluid structure: Their Family Bank was flexible enough to evolve over time as Family Council members identified needs and investigated opportunities. A Family Bank and Family Council are ideally established while the wealth creator is still alive so families can benefit from real life experience and knowledge. Younger members will be excited to participate so they can learn to make sound decisions that affect the entire family, and see that their input is valued. This family did an exceptional job of organizing its Family Bank and Family Council by being inclusive, open-minded and thorough.
Learning from Missteps
Several families I have worked with did not fare so well, and a few critical missteps stand out: The wealth creator holds the reins too tight: You won’t have true buy-in if family members see the Family Bank as a guise for wealth creators to push their own agendas and keep the next generation in line. The family bank fails to include multiple generations: Younger family members will ultimately be responsible for the family legacy and should be brought in sooner rather than later. Dismissal of viewpoints and unwillingness to consider unorthodox thinking: Diverse viewpoints and a breadth of ideas will only strengthen a Family Bank.
Who can benefit from a Family Bank?
If there are life lessons to be shared, a legacy to pass, mistakes to be prevented, a growing family roster with good ideas and fresh wealth strategies, outside entrepreneurial interests and a sizeable net worth — experts say at least $50 million — a Family Bank may fit your needs. Perhaps you’re not ready right now, but there are ways to test the waters. Consider setting aside a slice of the family wealth and bring the younger generation into a discussion about how to manage it. One family I counseled began by creating a mission statement and describing expected outcomes. Younger members learned what various opportunities looked like and how to evaluate them, seeing wealth creation through a unique lens. Once you decide to establish a Family Bank, early steps include: Writing the family mission statement Setting up a Family Council Articulating desired outcomes Establishing governance procedures You will need expert advice to establish the legal structures. However, you may benefit from outside guidance even earlier in the process. This person should have knowledge of family governance — someone who previously sat on family boards or has a broad background working with families of wealth, such as through a family office. A facilitator from outside the family can be the objective voice through each step, helping all family members to be heard.
13 JUNE 2013
OPINION COMMENTARY FROM ACROSS THE WEB
Time for Attorney General Eric Holder To Resign It’s been a rough month for U.S. Attorney General Eric Holder. The nation’s top law enforcement has been harshly – and justifiably -- criticized for the heavy-handed tactics his agency employed to investigate the press. And now it’s time for him to do the honorable thing for both the country and the Constitution and resign. ...Every moment that Obama has to spend defending his embattled attorney general is one moment less devoted to furthering the cause of his marquee accomplishment: the federal Healthcare Reform Act or tackling the coming explosion in student-loan interest rates. While there is no doubt the scandals surrounding Holder are important, they are much less important than pocketbook issues that affect the real lives of millions of Americans. PATRIOT-NEWS EDITORIAL, 7 JUNE 2013
Strengthen PA’s Energy Already, Pennsylvania has fallen well behind Delaware, New Jersey and New York in the amount of clean renewable alternative energy required to be made available to its residents. For example, Pennsylvania’s Alternative Energy Portfolio Standards require that a pathetic 0.5 percent of solar energy be sold by the year 2021, whereas Delaware and New Jersey are requiring that solar energy provide 3.5 percent and 4.1 percent of demand, respectively. And now, as ludicrous as it seems, state lawmakers are under heavy pressure from industry interests to allow the burning of municipal solid waste and natural gas to qualify as Tier I clean alternative energy, further undercutting genuine clean energy like wind, solar and geothermal. This is just plain wrong on so many levels. Speeding the transition away from fossil fuels and other dirty energy sources, like municipal waste incineration, to actual clean energy would bring benefits in cleaner air and water to all of the commonwealth’s citizens.
Funding Crisis Is Statewide Gov. Corbett and the legislature know Philadelphia isn’t the only school district in Pennsylvania facing a financial crisis. So why is it taking them so long to come up with a viable statewide solution? Already there have been teacher layoffs and other budget cuts. Academic and extracurricular programs have been eliminated, and class sizes have grown. The situation will only get worse unless the state lives up to its legal and moral obligation to provide its children with “a thorough and efficient education.” It’s not as if there aren’t sources Harrisburg can look to for the revenue needed to adequately fund public schools. It can start by eliminating excessively generous corporate tax breaks touted as being needed to bring new jobs to the state. Good schools that produce workers with needed skills can attract jobs, too. ...It’s a tall order for Corbett and the legislature, but they need to consider the consequences. Having poor schools can do more damage to a state in the long run than any natural disaster. PHILADELPHIA INQUIRER EDITORIAL, 11 JUNE 2013
Journalism Consumers Are Scandal’s Victims The nation learned in May that the Justice Department secretly obtained the phone records of more than 100 Associated Press reporters and monitored Fox News reporter James Rosen’s personal email and cellphone records, branding him a “possible co-conspirator” in a classified leak case for asking questions of a government source. These revelations sent shock waves throughout newsrooms nationwide. Reporters can no longer assure their sources that interviews will remain confidential because there is no way to tell whether the government is listening. This attack on journalism reaches far beyond hardworking journalists and their sources. Make no mistake: The ultimate victims are the millions of Americans who rely on investigative journalism to inform them.
ROBIN MANN ON DELCOTIMES.COM,
CAROLINE LITTLE ON PHILLYBURBS.COM,
9 JUNE 2013
11 JUNE 2013
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Crane operator wanted in Philadelphia building collapse deaths turns self in.
The deaths + injuries this week were needless, senseless and woefully unfair. I’m heartbroken + angry.
Join us today as VP of Customer Care Don Langford discusses our new boarding process. At 12:00pm CT, tweet your questions with #AskDon.
7 JUNE 2013
24 MAY 2013
@tracibrowne It’s gotta be better than the way it is now... SMG Scores Pennsylvania Convention Center Management Contract 6 JUNE 2013
3 JUNE 2013
@RowHomeMag Valley Green Bank understands customer’s needs. South Philadelphia branch opening in June! Visit http:// ValleyGreenBank.com for more info!
CEO and President James D. McDonald Managing Editor Terrence J. Casey Associate Editor Rich Coleman
PHL to Shannon service is back! Flights returned yesterday giving customers more ways to reach the Emerald Isle 23 MAY 2013
@rebeccavanderbi Bad news at Boeing: 41 getting pink slips
We are almost to our goal of 10,000 summer jobs for Philly kids. To learn more check out http://www. phillysummerjobs.com . #summerjobs
10 JUNE 2013
@DanielleCohn Honored to chair the @USTravel Communications Council. What an impressive group of influencers who make an impact. 9 JUNE 2013
@ChildrensPhila We’re #1 on the @usnews list of Best Children’s Hospitals!
30 APRIL 2013
11 JUNE 2013
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13 JUNE 2013
BY THE NUMBERS
Philadelphia’s rank on the national ParkScore Index
City area comprised by park land
Acres of park land
Average number of acres per park
Playgrounds per 10,000 residents
Children’s Hospital of Philadelphia’s rank on the Best Children’s Hospital list by U.S. News & World Report
Rank for Urology
Rank for Pulmonology
Rank for Orthopedics
Rank for Gastroenterology and GI Surgery
Funding for Pennsylvania Transportation, approved by the state Senate last week
Surcharge on drivers who violate traffic laws
Maximum fine for failure to obey traffic control devices, up from $25
Annual registration fee for Pennsylvania vehicles, up from the annual $36 fee
Annual spending on highways and bridges
$261,375 Salary of Police Commissioner Charles Ramsey, according to Philadelphia Magazine
$245,805 Salary of Medical Examiner Sam Gulino
$208,101 Salary of Mayor Michael Nutter
$205,000 Salary of Airport CEO Mark Gale
Rank for Diabetes and Endocrinology
Rank for Cardiology and Heart Surgery
Rank for Cancer
Rank for Nephrology
Rank for Neurology and Neurosurgery
Rank for Neonatology
$50K FOR 50 STARS
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Published on Jun 13, 2013