Fledgling entrepreneurs George and Jenny Mayaka of Eagan launched their version of the American dream in July at The Shops at Arbor Lakes in Maple Grove.
George Mayaka, however, isn’t about to quit his day job just yet. But he has high hopes for their franchised Vom Fass, the German-born retailer of oils, vinegar, wines and spirits.
“My wife, Jenny, is the one who runs the day-to-day activities,” he said last week. “We’ve been open about a month. We had a great grand opening. Things are going well.”
George Mayaka moved to Minnesota nearly 20 years ago to attend school, intending to return to his native Kenya after graduation.
Instead, he met and married Jenny and took a job in sales for Sandvik Hyperion, the Swedish industrial tool maker that has a Twin Cities plant. And the couple had two children.
George Mayaka, who travels extensively, came across a Vom Fass store at a California airport. It reminded him of shopping with his mom in the Nairobi of his boyhood. Customers would sample before buying at food shops. The Mayakas borrowed $300,000-plus from their 401(k) retirement plan and a U.S. Small Business Administration-guaranteed bank loan for the franchise fee, inventory, construction and start-up costs. Mayaka, noting that it’s expensive and risky to get into the food-and-spirits business, is not quitting his day job.
He’s encouraged by results so far at the 1,300-square foot store.
“The products are fantastic,” George Mayaka said. “And The Shops in downtown Maple Grove is proving a great shopping destination.
“We’re store No. 20 in the United States and No. 2 in the Twin Cities (the other is at the Mall of America). We just want to get this start-up business stable and cash-flowing within a couple of years,” Mayaka said. “We hope to open another store … perhaps in Nairobi.”
He might try closer to home, too. “Rochester also would be a great location,” he said.
SRC expands again in Carver County
Chaska-based Super Radiator Coils (SRC) has broken ground on its second multimillion-dollar expansion in three years.
SRC is building a 22,000 square-foot addition to meet demand for heat exchanger coils used at nuclear power plants and other facilities. SRC is one of only three such manufacturers that are certified by the American Society of Mechanical Engineers for nuclear power plant equipment and to display the society’s “N-Stamp” on its coils. The company also has plants in Richmond, Va., and two facilities in Phoenix.
The $4-million addition will result in about 30 more skilled workers at 350-employee SRC.
“We are delighted to be adding more American manufacturing jobs to help us build equipment for the growing nuclear power market, as well as for other commercial and industrial markets,” CEO Rob Holt said. “Those include heat exchanger coils for food processing companies, equipment for the compressed natural gas industry and products for the military.
“Growth for this type of coil has exceeded our forecasts primarily due to the general economic recovery, especially in manufacturing capital equipment, an aging equipment in nuclear power plants in North America and Mexico.”
SRC, which is privately financing most of the project, will receive a $287,500 grant from the Job Creation Fund of the Minnesota State Department of Employment and Economic Development (DEED). In addition, it will receive a $150,000 loan from the Carver County Business Loan Fund.
SRC’s rapid cool-down coils are critical safety components for emergency shutdown procedures if a nuclear plant loses its cooling. The large banks of coils are built with specially designed tubes and fins that quickly lower the temperature and pressure of the atmosphere in the containment building that houses the fuel rods.
“Side by Side” strategy, capital raise for beleaguered Gevo
Biofuels producer Gevo Inc. saw its lagging stock gyrate last week after reporting robust ethanol production and gains in output of an alternate alcohol at its Luverne, Minn., plant.
The Englewood, Colo.-based company developed technology to produce isobutanol, a high-value alcohol that can be used as fuel or to make chemicals. Gevo purchased the Luverne plant in 2010, and shut down ethanol production in 2012 only to run into challenges making isobutanol at a commercial scale.
The company recently switched three of four production lines back to ethanol, which now sells at a high margin. Gevo reported last Tuesday it was producing 1.5 million gallons of ethanol per month along with “tens of thousands” of gallons of isobutanol. Both fuels are fermented from corn.
“[W]e have dramatically reduced our cash burn at the plant and we are targeting break-even at Luverne by year end,” CEO Patrick Gruber said in a statement.
But on Thursday, the company issued new shares at a discount to raise $18 million to pay for renovating the Luverne plant. Its share price fell 30 percent that day to reflect the price of the new issue.
Gevo, which has burned through millions in cash, will use the fresh money to complete the side-by-side configuration of its Luverne facility and for working capital. The company’s stock price has fallen from more than $20 per share in 2011 to as low as a half-buck per share last week.
DAVID SHAFFER and NEAL ST. ANTHONY
• Michael Shuman, economist, attorney and author who champions community-based commerce, was an architect of the “equity crowdfunding” reforms that became the 2012 federal “JOBS Act.” Shuman will speak about pending federal securities regulations on grass-roots capital raising at the Minneapolis College of Art and Design on Thursday, Aug. 7 at 7 p.m.
• Tom Triplett, business lawyer and former state official, says the Twin Cities is a “hotbed of the social-enterprise movement, promoting the development of local businesses that have both a financial and social-good bottom line.” Register for Shuman’s talk at http://tinyurl.com/mzohrr3. More information on social enterprise at www.seatwincities.org or www.michaelhshuman.com.
• Minneapolis is one of the 10-fastest recovering cities from the Great Recession according to WalletHub.com’s annual survey. WalletHub used 18 measurements, from the inflow of college-educated workers to unemployment rates and new businesses, to rank the 150 largest U.S. cities. Other top-recovering cities: Irving, Texas, Corpus Christi, Texas, Dallas, Denver and Raleigh. Laggards include Riverside, Modesto and Stockton in California, Tucson and Tempe in Arizona, Cape Coral, Fla. and Detroit.