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Oakville Entrepreneur Transitions From Corporate Life
Jon Cook - Reporter
February 26, 2013 -
The mega merger of computer giants Hewlett-Packard and Compaq had a
life-changing impact on Oakville entrepreneur Stan Prokop
A few years after the deal was completed in 2001, Prokop found himself out of
work when his job as a credit manager for HP Canada’s financing wing was moved
to New Jersey.
“I had bad dreams about doing deals with Tony Soprano so I went out on my own
for the first time in my life,” joked Prokop, 62, who launched his
Oakville-based loan business – 7 Park Avenue Financial – in 2004.
For a decade Prokop had directed up to $500 million a year in internal financing
for HP, but now found himself trying to hustle for clients.
“It’s always been a challenge for me, because I’m more of a corporate guy than
an entrepreneur,” he confessed. “I did my first business with clients of HP
because I would have been terrified to go elsewhere and knock on doors.”
His first major deal was with Toronto restaurant chain Pizza Pizza, for whom
Prokop had previously helped finance all their call centres while at HP.
While he enjoyed an auspicious start, Prokop’s momentum was halted by the
financial crisis five years ago that dried up credit markets and claimed a
number of small firms.
“In 2008 the world ended in business financing,” said Prokop, who averages about
five deals a month. “It was just really grim and ugly for a year or so. We
survived through that while many people similar to myself didn’t.”
In the last nine years, Prokop said 7 Park Avenue has done $85 million in
financings for about 400 businesses. The deals have ranged in size from as
little as $5,000 to multimillion-dollar loans for clients with more than $300
million in revenues.
With stock markets volatile and credit tough to get for many companies, a range
of small- and medium sized businesses often turn to alternative financing firms
like 7 Park Ave. to get the capital they need to grow.
Last year, Prokop arranged a $1.5 million loan for Mississauga-based biofuels
company Methes Energies Canada, a subsidiary of U.S. parent Methes Energies
International Ltd. (NASDAQ: MEIL).
Michel Laporte, Methes’s chief executive, said one of the reasons he chose
Prokop over a big-name lender was the quickness at which he could put a deal in
place.
“Working with Stan we were able to do this whole thing in a couple of weeks,”
said Laporte, who used the money to complete financing of Methes’s Sombra
biodiesel plant near Sarnia, Ont.
That plant recently won a major order to sell 50 railcars full of biodiesel to a
U.S. customer.
As recognition for its longevity, the Oakville Chamber of Commerce has nominated
7 Park Avenue for small business of the year . The winner will be announced at
the organization’s annual awards ceremony next month. In 2010, Prokop’s firm was
named Oakville’s top service provider.
Prokop specializes in alternative financings, securing loans against a
business’s assets that include anything from equipment, real estate, inventory,
future sales and receivables (also known as factoring).
A lot of his work has been for clients in the television and film industry,
where Prokop leverages tax credits as backings for loans. “We finance the tax
credit that allows the company to make the next show or movie.”
Prokop said he typically charges a one-per-cent fee and has a soft spot for
helping the “little guy,” which he added has likely depressed his revenue growth
over the years.
“I should be looking for a better deal,” admitted Prokop. “IBM or Bell Canada
doesn’t need my help, but there’s a thousand guys out there that are starting a
business that definitely need my help.”
Prokop, of Polish descent, is often confused for local celebrity Skip Prokop,
the founder of 1960’s Hamilton rock band Lighthouse.
The musical theme is one that runs throughout his business, as 7 Park Avenue
takes its name from the London address of British band Badfinger.
“They’re one of my absolutely favourite bands,” said Prokop. “I was a product of
the ‘60s; I played in bands and still play guitar as a hobby and jam with
friends.”
As far as his day job, Prokop said he’d likely retire in the next three years to
spend more time with his wife, who he married at age 50. However Prokop said
it’s unlikely someone will continue his business.
“I don’t think it’s sellable because I’m the only asset. I wish I could sell the
company and the name could continue on and someone could do something with it,
but I don’t have a sense that’s how it’s going to turn out.”
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