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The Business Page

Welcome to the business page, a blog where I'll take you behind the scenes of greater Rochester's fast-changing economy. My name is Ben Rand, and I intend to introduce you to some of the personalities, concepts and events that make news in business here. I've been a business reporter for eight years in Rochester and a journalist for 18, working in four states. I grew up in Pittsford, but moved away after college for about a decade. My wife and I live in Irondequoit with our two children.

Wednesday, December 14, 2005

More Ferry Talk

It seems to me that the easiest position to take on Rochester taxpayers going deeper into debt for the Lake Ontario Fast Ferry is to be shocked. Shocked!

And given our community's pressing needs, I'm not trying to minimize the additional $10 million. It's a big number, a lot of money that could underwrite many important programs.

Having covered economic issues as a subject for almost 11 years now, however, I would argue that what the Ferry Corp. is doing is no different than any start-up business. It is trying to stay alive so it can continue searching for an approach and structure that works. Often that requires more capital. Behind that request for more money is a company -- Bay Ferries -- that's been in business a long time.

There will be plenty of time to second-guess and criticize and hold people accountable if the ship fails. But let's see how this new plan unfolds.

7 Comments:

Blogger 1Bigcoach said...

Hey Ben,
Great topic - We've got it(happy days) now so lets ALL get pulling on the same rope and get it profitable.

I visited with the Canadian government last year and they are very interested in working to bring business to the US and to Canada. This ferry is a great tool for business people that would like to expand their market in to Toronto -6,000,000 people.

If all the business organizations / towns would look at ways to engage the great people across the lake in business or recreation this ferry would be filled.

Lets use your blog to create a fire storm of ideas and get our minds out of the " it won't work" mode and into the "lets see how we can use this wonderful asset" mode.

Lets all think like the "Cinderella Man" did in the movie, it will work and we as a community will feel very proud!


Some great ideas from a great Guy.

5:06 PM, December 14, 2005  
Blogger Behind The Business Page said...

Hey Coach,

Good idea. I think I'll let the dust settle after the first of the year and see what ideas we can stir up.

-Ben

5:02 PM, December 16, 2005  
Blogger J said...

Well, I think we can cheer forever but it won't change the numbers. The ferry is too big for this port, plus the cost, & it will never generate the passengers needed to pay for itself.
Also, what's the rush on getting $11.5 million more, why not let Duffy & the new City Council decide what they want to do. Johnson's almost gone, & he never had any projects that were a success, why stick the "new guys" with more of the same.

6:46 PM, December 16, 2005  
Blogger Behind The Business Page said...

J,

I'm not suggesting people need to cheer. I'm saying that given the facts -- an artifically short season, limited or no marketing, unforseen hikes in gas prices -- the boat has not yet had a "real" season to judge its viability. The price and the risks are high, no doubt, but the rewards might be as well. Nothing ventured, nothing gained.

3:56 PM, December 26, 2005  
Blogger Brian Bell said...

Ben,

If the City wants to be in the venture capital business (i.e., funding startups like the Fast Ferry), then it should at least (1) diversify its investments like any investor in a mutual fund (or venture fund). Its a known fact that only 1-2 out of 10 startups ever payoff meaningfully for investors, and (2) each investment should be based on a competitive advantage (like the optics strength of Rochester, or a new drug compound from the UofR Medical Center) where previous dollars and intellectual property protection can be the basis of a starting point, NOT A HOPE THAT WE CAN MARKET ROCHESTER AS A TOURIST DESTINATION. If the Ferry is a startup, it seems like a big bet on an unproven business model.

The economic and financial payoff of traditional venture capital is well established in 25 years of history (see www.nvca.org), you can recruit top quartile managers from inside or outside the region and match the City investment with $10 million from the NYS Common Retirement Fund, thus, further lowering one’s risk.

How many full time, high paying jobs will be created by the Ferry directly?

One of the first rules of investment is "Don't throw good money after bad, every incremental investment should be reviewed as a new investment, not to protect your previous ones." How many citizens of Rochester would write another personal check to invest in the Ferry?

9:16 AM, December 29, 2005  
Blogger Behind The Business Page said...

Hey Brian,

You make good points -- hard to argue about the need to evaluate incremental investments carefully and to diversify. But to one extent or another, all governments play this "VC" game (i.e., through grants and tax incentives. See: Rhinos stadium.) I think that's probably a different discussion, however.

I appreciate that your argument steers clear of the emotional "it'll never work because this is Rochester and nobody wants to come here" sentiment. Too many people are overly negative for the sake of being negative.

Where you or I may differ is on the "wishful thinking" syndrome. Are the decisions on the Ferry new based on an irrational hope that it will all work out? Or are they least partially scientific? I suspect only a few people know the answer for sure, and that truth, as always, is somewhere in the middle.

12:11 PM, December 29, 2005  
Blogger 1Bigcoach said...

Happy New Year Ben,

One question, foe all the talk and expense regarding the Fast Ferry "Why didn't Duffy hold his grand opening on the ferry?"

MARKETING is key ???????

Or is this an indicator of his bias towards the ferry?

Oh well it's time to start the Awesome New Year!

9:51 AM, January 02, 2006  

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