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How to Survive an ‘Extinction Event’

How to Survive an ‘Extinction Event’


Rita Baslock was just days away from a hard-earned vacation when all hell broke loose.

Her company, Max Electric, had been working on the largest single contract in its history when the client—a much larger company—suddenly stopped all payments. Worse, the customer was throwing every roadblock imaginable in Baslock’s way.

Without that cash flow, Max Electric was in jeopardy of going under. About 40 employees depended on the Grandview-based electrical contractor for their livelihoods.

“It would’ve been the end of us the month it happened,” said Baslock, Max Electric’s president.

Luckily, Baslock was part of the Helzberg Entrepreneurial Mentoring Program, a local nonprofit that finds mentors for small business owners. The program is celebrating its 20th year of helping Kansas City entrepreneurs master critical skills.

Different studies have indicated that mentoring can improve businesses’ survival rates. Seasoned mentors can share advice and boost morale when company owners are facing dire odds.

When Baslock realized she needed help, she immediately called her HEMP mentor, the late Ray Pitman. Pitman, she said, stayed by her side from dawn to dusk for nearly two weeks. He reviewed documents with her, tagged along to meeting after meeting and—most importantly—told her that she could get through it.

“It really made a big difference to have Ray,” Baslock said. “I don’t think we could have survived it without him.”

And Max Electric did survive. Within a year, it was finally paid all the money it was owed.

“They helped me to fight Goliath,” Baslock said of Pitman and Barnett Helzberg Jr., HEMP’s founder. “They were my slingshot.”

‘Worst Foot Forward’

One of HEMP’s cornerstone beliefs is a willingness to “put your worst foot forward.” That is, business owners need to be willing to talk to their mentors about parts of the business that aren’t going so well, so they can get help.

(This is possible only because of HEMP’s ironclad rule on confidentiality. Nothing that an entrepreneur tells a mentor or fellow mentee can be disclosed without the entrepreneur’s blessing.)

Sometimes, “putting your worst foot forward” is harder than it sounds.

When Dan McDougal joined HEMP in 1999, his hydraulic dredging company was experiencing rough times. Dredge America had gone from working on projects on inland lakes and ponds to tackling work in the Gulf of Mexico, which presented new challenges and expenses.

“Long story short is a one-month job took over a year and drained all of our working capital and then some,” McDougal said.

McDougal delayed talking about his problems with his mentor, Pitman, until it couldn’t be avoided.

“After several months of doing everything that I knew to do to manage the situation, I finally met with my mentor and told him I had no idea how I was going to make payroll next week,” McDougal said.

“He listened patiently for about an hour as I shared my doomsday story. Then he calmly said, ‘Hell, I had it worse than that.’”

McDougal thought that Pitman was just being polite, but then the executive spent an hour detailing all the near scrapes he’d encountered.

Pitman really had survived worse. And that gave McDougal the inspiration to keep going. He mortgaged everything he owned, emptied out his retirement and worked out extended payment terms with his suppliers and bank. Cash-flow management became a daily project.

And though it took some time, Dredge America recovered. Today, it’s thriving.

“Determination, passion and perseverance are all necessary for success,” McDougal said. “It also helps to tell yourself often that failure is not an option. Once you acknowledge that to yourself, you go about your business to do what you have to do to reach your goals.”

Finding Potential

At first, Gary Short was a little surprised that HEMP would welcome him as a mentee.

His engineering firm, Sys-Tek, had built a thriving business in designing data centers for telecom companies, until those jobs started drying up in the early 2000s. When he applied for HEMP, his company’s revenue had crashed.

“The dot-coms turned to dot-bombs, and practically all of our business went away overnight,” Short recalled.

But his honesty about his situation showed HEMP officials that he would be a perfect fit for the program. He was paired with Pitman. Pitman helped Sys-Tek find new, but related markets to pursue—hospitals and research labs’ electrical and engineering needs aren’t radically different from those of data centers.

At Pitman’s advice, Short brought in talented associates who could carry some of his workload. Sys-Tek also began offering a series of value-added services, such as helping customers install equipment and appliances.

“We started providing more than just engineering,” Short said. “We started providing a full solution for a client.”

Thanks to Pitman and HEMP, Sys-Tek was able to shift its chief goal from simple survival to growth. HEMP leaders could see that, just because his company had experienced a major setback, Short still had great potential.

“They knew that if I could do it before,” Short said, “I could do it again.”


James Hart

Written by

James Hart is a freelance writer based in Kansas City.

Categories: Management


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