Jane Yuen-Lin Mahowald is a grateful immigrant, small businesswoman and citizen.
And Mahowald, 63, backed by her twin sister Winnie Yuen-Yee Crosbie, a successful Realtor and property manager, likes a challenge.
In 2012, Mahowald, who had raised three college-graduate kids while she often worked part time, launched an industrial painting company.
It took her two years to study the market, get licensed and certified as a female- and minority-owned business. She was determined to crack what has been largely the province of white male-owned firms. Her Assure Quality Painting boasts up to 15 workers, most of them minorities.
"Jane is the instigator," sighed Crosbie. "But everything is intentional with Jane and I. We are partners."
And this is a challenging time. The owners lack sufficient capital to take the business to the next level and profitability. Assure has finished jobs that generated $2.5 million over the past couple years, but it lacks the working capital to finance additional jobs that would drive revenue and achieve positive cash flow this year.
"I have more than $1 million in contracts on hand, eight jobs," said Mahowald. "I bid and won them for this year. I'm working on three, with Sheehy Construction and Minneapolis Public Housing Authority and a project at Summit Academy with Thor Construction. I need funds for the future projects that are scheduled to start soon, this summer. The banks won't make us a loan until we are profitable.
"We invested everything we can to build our credibility and capacity. It's time to take advantage of our sweat and equity. But we need more funding."
Mahowald and Crosbie have invested more than $300,000 to capitalize and cash-flow Assure. They have hit the vexing chicken-and-egg issue for tiny subcontractors. It takes a lot of money to get established, get scale and make some money.
The general contractors, such as Mortenson and Thor, typically take up to 90 days from the time work starts to pay their subcontractors. Capital-short subcontractors often wash out. They lack the resources to self-finance until they have built a business big enough to finance itself. And banks don't loan to businesses that can't demonstrate positive cash flow.
"I spent $65,000 last year on renting equipment for several jobs that I could have bought for under $40,000, good used or new equipment. But I didn't have the money at once, and nobody would lend it to me," said Mahowald. "It's kind of a vicious cycle."
Mahowald is unable to secure sufficient working capital to take the jobs she's been offered this year. They would drive revenue over $1.5 million and generate positive cash flow. She's hoping to find an investment partner. Perhaps a nonprofit lender looking to advance a minority subcontractor.
"My kids told me not to do this," Mahowald said of her three adult children who work as a software developer, ballerina and police officer. "I told them that I am an immigrant and people helped me. And I want to help minority employees. I pay good wages. A good job can change a life."
Wade Leonard, the owner of Wisconsin's Rice Lake Construction Group, has agreed to accelerate payments on jobs with Assure. Leonard said in an e-mail Friday from a job in Canada that Assure does good work and that he is committed to "ensure [Mahowald's] success" and considers himself a business mentor to Mahowald.
Mahowald may be a long shot but that's the story of her and her sister's immigrant-success life.
Mahowald and Crosbie arrived in Minneapolis in 1972 with little but their clothes. Their father was living in the country illegally, working for cash at the old Nankin restaurant. He didn't speak English. They hadn't seen him since they were toddlers. He lined up jobs for them.
"I said, 'Dad we don't want to work in Chinese restaurants. We want to learn English and work with Americans.' "
The sisters headed to the former West High School, which offered an English-language program for immigrant students. They spent a year learning from teacher Sharon Bennett, with whom Mahowald and Crosbie remain close. The sisters took odd jobs, rode the bus, became citizens and found full-time work.
Mahowald and her ex-husband raised a family in Bloomington. The two are still close, but the marriage dissolved over her decision to start Assure.
Crosbie, an Edina Realty agent, married an inventor and musician and lives in Edina. They brought their mother to America in the 1980s. Crosbie started buying small houses, the first for her mother. That led to a rental business. Mahowald would work with her to fix and paint houses between renters. She also cleaned and painted apartments for another company.
The sisters consider themselves fortunate, if a bit naive.
"We didn't understand that women aren't part of that built-in construction network," said Mahowald, who said she works 50 hours a week and reinvests much of her $50,000 salary into the business. "But if I succeed, a lot of minority workers will succeed.
"And I always wanted to build a business. And build some equity. Then I will retire."
Neal St. Anthony has been a Star Tribune business columnist and reporter since 1984. He can be contacted at nstanthony@startribune.com.
