Austin Company Using SBA 504 Loan to Create Welcoming Office Environment for Employees

bio_pic_andyGasPedal CEO Andy Sernovitz believes in making a commitment to his employees as well as to his clients. The New York Times’ best-selling author views the company’s employees as his work family and wants to ensure that they have the best possible environment so they can enjoy their time at the office while also being productive.

gaspedalFinding that the company was starting to outgrow its third leased space in five years, Sernovitz considered locating another rental in Austin’s hot real estate market. However, thanks to an SBA 504 loan through Texas Certified Development Company and Horizon Bank, he found he could purchase a location that would meet both the company’s current and future needs while also improving its bottom line. “When we looked at what it would cost to rent space, we realized that with a 504 loan, it would cost us the same to buy space,” Sernovitz said. “The 504 loan also changed the economics of our small business. The rent money is now going to be invested in equity. It improves our entire balance sheet and makes us a stronger, more stable organization.”

Creating a Community to Support Networks

Founded in 2006, GasPedal’s mission is to support peer-to-peer networking groups for clients from major corporations. For instance, the company’s staff members manage the networking efforts of Clients involved in this effort include social media managers from a wide-range of companies, including Aetna, Hallmark, REI, Hewlett Packard, Sonic Drive-In and St. Jude Medical. These network efforts, which include meetings and conference calls, help corporate social media managers learn from each other.

To help staff members facilitate these types of conversations, GasPedal needed an ideal space that would offer both dedicated quiet space as well as meeting areas that could help spark innovation. Furthermore, the company often asks employees to travel between the company’s two offices in Austin or Chicago for extended stays. Thus, the location needed to be able to accommodate staff members who would be there on a temporary basis.

Having the Vision for Growth

quote_andyIn his search for property, Sernovitz stumbled on a 44-acre ranch that included a warehouse. The facility is an unusual use of space and also bigger than what most companies of GasPedal’s current size would seek. “But it makes sense when you’re looking at a 20-year development plan,” Sernovitz explained.  “Do we need this much space this week? Probably not, but when you look at how we grow over the next few years, we have the ability to grow into what will be our permanent office campus. That’s the real opportunity. That requires a certain amount of vision and understanding of what we’re doing, where we’re going and how we’re growing.”

However, finding financial partners who understood that vision took some time. Sernovitz spoke with a dozen lending institutions but found that many bankers weren’t interested in financing the deal. “Most of the other bankers and CDCs that we talked to couldn’t understand what we were doing,”  he said. “What we really loved about TxCDC is that they really understood our business and our non-traditional strategy and then found a way to make the deal happen.”

quote_andy2Sernovitz’s energy and blueprint for GasPedal’s growth impressed TxCDC’s staff members. “Blyth Rehberg, our Central Texas business development officer, and I were introduced to Andy by Shirley Sheffield of Amplify Credit Union,” TxCDC President Suzanna Caballero said. “We were amazed by the company and Andy’s enthusiasm.  His vision was clear that he was going to create an environment that nurtured his staff and that could be a destination for his clients.  He wanted it all in one space and the new location and financing with SBA’s 504 program fit his needs.  He now has the location, money to make improvements, a low initial investment and low monthly payments.”

Caballero also helped Sernovitz find a bank partner in Horizon Bank and was able to close on the loan in mid-December. “TxCDC pushed the process through faster than anybody else,” the GasPedal CEO said. “Horizon and TxCDC are the folks in town who know how to get the deal done.”

A Place Called Home

GasPedal’s new location will be one of the first office projects going into one portion of Northeast Austin. “It’s something that’s good for us, TxCDC and the city,” Sernovitz noted. “Together, we’re bringing a lot of jobs and a lot of innovation to an under-served part of town.” He anticipates that GasPedal will double in size to 50 employees when the new location is completed in the next year.

The new facility also will serve as home base for GasPedal’s many long-term employees. “We have a lot of employees that have been with us for five or more years so longevity is a big deal for us,” Sernovitz said. “A lot of companies talk about the family feeling at work. We’ve had three weddings this year, three babies this year so we have a whole lot of folks growing up with our company. So when we look at those kinds of family relationships and we start planning on a 15-year or 20-year horizon, the 504 philosophy sort of fits with our view of the world. Committing to a 20-year loan to build out a home for our work family – that’s something we like.”

Written by Dorian Martin