Hire Power No experience, no money and lots of competition. So why take the chance?

When 32-year-old Harold Leffall Jr. was about seven, he'dset up "a little desk with notepads" and play business inhis mother's small Oakland, California, abode. Family andfriends thought it endearing but certainly had no idea young Haroldwould actually grow up to head a staffing business with salesexceeding the million-dollar mark--especially since no one in thefamily had ever gone to college and welfare was the primary sourceof income. "A lot of people say they didn't know they werepoor when they were growing up," says Leffall, owner ofLeffall Employment Agency in Oakland. "But I knew I was onwelfare, and I didn't like it. I decided very early on thatwhen I got older, [being poor] wouldn't be part of mylife." With the idea that individuals living above the povertyline possessed a higher level of education, Leffall enrolledhimself in California State University at Hayward, despite the facthe had to simultaneously work as a shoe salesman to put food on thetable. Academic life initially caught the wide-eyed freshman offguard. Luckily, Leffall, whose father "really wasn'taround" growing up, gained valuable mentors through thefederally funded Upward Bound program, designed to providemotivational support to first-generation college students fromlow-income families. "I was fortunate because that exposed meto individuals from similar backgrounds who not only successfullywent on to college, but also completed it." And complete it hedid. It took five years, but Leffall, a business administrationmajor on first declaration, finally graduated with a degree inpolitical science. "Like most college students, I was overlyoptimistic," recalls Leffall, who once aspired to be a citymanager. "I thought `As soon as I get a degree, I'll havejob offers coming from everywhere.' But it took a whole year tofind a job."

The Quest For Independence

Ditching his shoehorn, Leffall spent the following six yearsworking in community-service positions. For the first five, hecreated youth and family programs in urban communities for theOakland Housing Authority. And for the next year, he aided anonprofit organization in getting the community more involved withthe educational upbringing of children. Unfortunately, the goodvibes created by the goodwill work became increasingly strained bybureaucratic frustration. Whether it was being passed over for manya promotion by his first employer or nearly being laid off when theproposed five-year community education project came to a halt afterless than a year, it became starkly apparent to Leffall that it wastime to get started working for his own cause.

"What I wanted was more control over my life," hesays. Drawing from his childhood dreams, Leffall began exploringbusiness opportunities, even though he'd just started graduateschool to get his master's in management. "It just sohappened that we had to do a project on growth business areas inone of my classes," he says. "In doing it, I came acrossthe staffing industry and realized the projections for growth werejust astronomical because more and more companies were moving awayfrom a permanent work force to a more contingent, contractual workforce."

It sounded promising enough. The only catch was that Leffallneeded a minimum of $25,000 in start-up capital and a set ofinstructions on how to start a staffing business (or any business,for that matter). Luckily, a friend in the industry shed some lighton the unknown. But the money hunt wasn't so easy. He soughtassistance from small-business-friendly financial institutions likethe SBA, his local bank and a nearby Small Business DevelopmentCenter. With an insufficient business plan and a lack ofcollateral, however, Leffall's request was almost immediatelydenied by all three. "They knew staffing was a growingindustry and thought there was so much competition from majoragencies that a small agency like ours would be eaten alive, andthat we didn't really have an opportunity," he says."And I just didn't really want to hear that."

Maybe it was to retaliate against what poor kids are too oftentold growing up: Don't dream too big. Be practical--go getyourself a job at the post office. Whatever it was, Leffallwasn't about to settle for less than his highest hope. Hedismissed warnings from friends that he could lose everything andaccepted one of many mail offers to take out a second mortgage onthe Stockton, California, home he'd purchased two years priorand was, at the time, renting out. When he finally secured the$25,000 loan in July 1996, he happily resigned from his job at thenonprofit organization.

Hard-Won Success

By October, Leffall found himself behind his own desk in his ownoffice, with a receptionist ready to hand out freshly printedbrochures to clients. Unfortunately, there were none. "Likemost entrepreneurs, I thought this would explode immediately,"he says. "But for about two months, the phone didn't ring.We were making all these cold calls and no one wanted to talk tome. I was so discouraged because I really thought I had a good ideaand business would pick up."

Flabbergasted by the curt responses from companies unwilling todeal with an unknown, and with only half his start-up loan tospare, Leffall decided to give his agency an infusion ofcredibility by joining the Oakland Chamber of Commerce and theNational Association of Temporary Staffing Services. He sent massmailings to Chamber members offering special rates and attendedChamber meetings and industry mixers. Slowly but surely, he wonmuch-needed contracts. "That gave me more confidence toapproach companies," says Leffall. "It wasn't much,but at least it was something I could talk to a prospective clientabout."

Those first clients, including Leffall's former employer,the Oakland Housing Authority, led to much more than small talk.Leffall Employment earned sales of $272,000 in 1997--up 100 percentfrom 1996. But Leffall admits those numbers seem more impressivethan they actually were. Profit margins in the industry are so lowthat after paying expenses and employees, he only got 10 percent ofsales for himself. "I got used to fixing Top Ramen in verycreative ways because I couldn't go out," he recalls."I couldn't buy new clothes, but I had a lot of my oldclothes. So when people saw me, they'd think I was okay."It didn't help that for most of 1997, Leffall unknowinglycharged half of what his competition was charging for services. Notgetting paid by "the most unlikely sources," like doctorsand lawyers, also became problematic. He found himself in court--afew times--just to be reimbursed for his work.

After sales and marketing became less tumultuous and many hardlessons had been learned, business looked brighter. By 1998,Leffall had the budget to hire a qualified full-timer to help withrecruiting and placement. (He'd already gone through twonot-so-qualified friends who agreed to work for low wages.) Andword-of-mouth landed Leffall Employment Agency its first two largeaccounts: a three-year contract with the County of Alameda,California, which reaped $700,000 for the company last year; andone with Shell Oil Co. to payroll participants in its youthtraining program. Leffall still gets excited reminiscing about theday the president of Diversified Personnel, also in Oakland, calledto ask if Leffall Employment was interested in partnering for theCounty of Alameda contract. "He wanted to meet with me thatsame day, but I was like, `Can we meet tomorrow?'" recallsLeffall. "I was just so elated. I knew I wouldn't be fullythere at that meeting."

Since coming of age in the staffing world, Leffall Employmenthas forged ahead amid the sea of nearly 20 competing agencies inthe Oakland area and has nearly doubled sales every year. Fromsales of $596,000 in 1998 to $1.3 million last year, Leffallexpects that, after winning the City of Oakland bid last September,sales will double again this year. A mentor to high school boys anda volunteer instructor of youth entrepreneurship for JuniorAchievement, Leffall will expound on his experiences in print witha self-published book titled Brother CEO this summer.

Risk-taking afforded him a chance to live the life he alwayswanted--even to buy his mother a new car. But would Leffall adviseanyone to start a business without sufficient knowledge? "Noway," he laughs. "Get practical experience byvolunteering for a company in the industry you want to get into.It'll save you a lot of heartache, and probably a lot of moneyas well."

Contact Sources

Leffall Employment Agency, 7700 Edgewater Dr., #647,Oakland, CA 94621, (510) 613-8080.