Issue: December 2008
The Business Ambassador
A serial entrepreneur, driven leader and committed community mentor, The Cleveland Group’s A. Eddy Zai wants to inspire the next generation of minority immigrant business owners.
#1 - The Cleveland Group
Location: Bedford Heights
Founder: A. Eddy Zai
Sales Growth percentage 2003 - 2007: 8,026%
One of the most important lessons A. Eddy Zai has learned in business is that anything can change overnight. One day, your revenues are a modest million. Then you bid on a large public construction job — Cleveland Hopkins International Airport. You bid for another, the Mayfield Road project, a complete rehabilitation of one of Northeast Ohio’s main arteries. You wait and see, then both bids are green-lighted. The next question is, “When will you break ground?”
This was the happy circumstance Zai, 40, confronted in 2007. As founder and CEO of The Cleveland Group, he suddenly needed to ramp his small business into a large-scale enterprise in just days.
“We spent more than $100,000 overnight to become a big player,” he says. Zai needed a new fleet of equipment to sustain the $15 million in revenue his company would realize in a year’s time. “It’s like when you go from a corner grocery store to a supermarket. Everything changes: your staff, your philosophy, your systems,” Zai says, earmarking clear obstacles to growth.
But Zai is somewhat of a master of reinvention. A Muslim born in Iran of Indian parents, Zai grew up in London, England, and Geneva, Switzerland, and attended college at Boston University. In 1991, he opened his own textile business in New York, which he sold when he moved to Cleveland with his wife, Tina, to be closer to her family. He launched The Cleveland Group in 1998, which provides construction, escavating, real estate and business consulting services.
“I had to sort of reverse-engineer my talents and put them to work in what industries were available in Northeast Ohio,” Zai says. With no background in health care and manufacturing on the decline, construction was a logical choice for Zai. “The public construction market was untapped by minority businesses, and barriers to entry were low, compared to the private sector,” he says.
From 2003 to 2007, The Cleveland Group boasted sales growth of 8,026 percent.
The number is staggering. “I’ve been pretty busy,” Zai says, downplaying the windfall.
Baiju Shah, CEO of BioEnterprise, reflects on Zai’s success in Northeast Ohio. “Eddy was able to open those doors that were initially closed to him, even though he wasn’t from here and didn’t have the longstanding relationships in our region,” Shah says, calling Zai a “prototypical entrepreneur,” hyperactive even, who is always working on the business.
Today, The Cleveland Group employs 88 people at its Bedford Heights headquarters. Only 5 percent of construction work is subcontracted. Zai says the public projects have kept his business stable in a rocky economy. “The lifecycle of public projects are longer, so those dollars are still in play,” he says.
Zai spreads his risk, like any savvy investor, by applying big-business philosophy to his small, dynamic organization (to Zai, “small” is $20 million or less). “Bigger corporations diversify, so I use that theory for small business, which is my background,” he says.
Besides, Zai likes to play in different markets, as demonstrated by The Cleveland Group’s four main pillars of business: excavating, construction, real estate and consulting. “[Diversification] is also a function of me being a mad entrepreneur,” he says matter-of-factly. “I have the uncanny ability to multitask. I can shift my focus every day to a different part of my business.”
In the business consulting division, Zai has become somewhat of an economic ambassador from his efforts to attract overseas companies and help them penetrate the U.S. market. Zai started in Israel, where he scouted and brought high-tech medical device startups to Northeast Ohio, linking them with resources and mentors such as BioEnterprise. So far, Zai has helped a dozen Israeli companies set up shop in Northeast Ohio, even giving them incubator-style office space within The Cleveland Group’s own offices. In 2006, Zai signed an agreement with the Israel Export & International Cooperation Institute to serve as an “official pipeline” for emerging technology companies immigrating to the U.S. from Israel.
Today, Zai’s focus is on attracting Chinese investors. China will bring pure dollars to the region if Zai has his way. “It’s the plain old wealth I’m targeting,” he says bluntly. He quotes Charles Darwin, who said the species that will survive will not be the strongest or most intelligent, but the one most responsive to change. “That is exactly what The Cleveland Group will do,” Zai says. “We have to respond to change, which is why I’m in China right now. The Cleveland Group will always evolve with market conditions, always evolve with opportunities that are out there.”
China is the obvious answer in regard to recruiting investors for technology, manufacturing and real estate opportunities, Zai says. “The economy just isn’t here anymore,” he remarks. “The sooner we start learning that and accepting it, the quicker we can get on with [business]. We have to start catering to the rest of the world as they have catered to us.”
Israel’s value was technology. “I tapped it because it is a mecca of research in development,” Zai says.
There are also opportunities in India, which boasts the world’s fastest-growing middle class. “They are going to need help catering to that,” Zai says.
Recently, Zai’s eagerness to propel entrepreneurship in the community has taken a new turn. In October, he and Shah received a charter from the Talent and ideas Enterprise (TiE), a well-known networking and business association for immigrant and minority entrepreneurs. During preliminary gatherings to gauge interest of an international entrepreneurial group in Northeast Ohio, Shah was surprised to attract groups of more than 250 on three separate occasions. These individuals had not reached out to other regional organizations for business support. There seemed to be a gap — one familiar to Zai.
“Eddy wants to make it easy for those individuals to get access to networks and opportunities, and to give them guidance on how to do business in Cleveland and the U.S.,” Shah relates.
While he enjoys helping foreign companies gain a foothold in the U.S., Zai also believes we have a lot to learn from other countries — and we’d better start learning fast. “We as Americans have done business a certain way for the last 20 years, and it’s time to figure out how to do business for the next 20 years,” Zai says. “That requires examining how we do things and accepting the fact that we have to evolve.
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