Friday, February 1, 2002

Incubators growing throughout Maine

Published in Interface Business News

AUGUSTA—Responding to demand for support of small businesses, the state of Maine and private-sector businesspeople are establishing seven business incubators around the state.

Called Applied Technology Development Centers, the state-funded centers are targeted at specific sectors of the economy, including forestry, aquaculture, precision manufacturing, biotechnology and information technology. Start-up grants for each of the seven centers around the state are between $450,000 and $950,000, and the state will support each center’s overhead costs with $40,000 to $50,000 in annual funding.

The goal is “to support emerging small businesses that are commercializing new technology, products and services,” said Phil Helgerson, director of the state’s incubator program.
Incubators provide space, business advice, professional networking and access to state, federal and private business development grants and loans, helping businesses get going.

“They can be more than they otherwise would be, operating independently,” Helgerson said.

National data, cited by a number of incubator administrators, indicates that over 75 percent of incubator graduates remain in business, and over 80 percent of them stay near where they incubated.

However, the centers must come up with most of the money to keep themselves going, from rent paid by tenants, grant programs and community and business contributions. Down the road, royalties from the products developed at the centers may provide a significant revenue stream.

“They are essentially self-sustaining operations,” Helgerson said. The program started in 2000 and got its first installment of state funds in early 2001. All seven centers will be done with construction by mid-2002, and some have already reached that stage, he said.

One state incubator has been going for five years, and offers a picture of where its sister incubators could be in that time. The Center for Environmental Enterprise, housed at Southern Maine Technical College in South Portland, already has one graduate, TerraLink, now on Congress Street in Portland.

The center has several tenants, including New England Classic, a wood paneling and wainscoting manufacturer that specializes in using sustainable resources in its products.

There is a waiting list to get in, and a rigorous application process designed to pick out the most likely to succeed, though Ferland admits that not all incubating businesses will graduate.

The incubator also offers a degree of legitimacy to a small business. “A federal lab isn’t interested in working with someone in his garage,” Ferland said.

An entrepreneur does not have to look to the state for incubators.

A privately-funded incubator is in development on Ayers Island, in the Penobscot River in Orono. It will focus on developing university research into commercial products. “It’s fairly broad,” said project coordinator John Hackney. One such commercial product is a method to turn household trash into building materials.

Things have been a bit slow to get going at Ayers Island, though, because the site, a former textile mill, needs to be cleaned up, and a one-lane bridge needs to be replaced before the center can really start up.

In rural eastern Maine, where businesses are often far from each other, the incubator idea has broken the “building barrier” with the Incubator Without Walls (IWW).

Project manager Debbie Neuman said it was impossible to choose a location for a building that could actually serve the entire region. “We felt we could have a much greater impact if we did it without a building,” Neuman said.

So the IWW serves six counties over the phone and the Internet, and with small centers in Calais, Bangor and Belfast.

Rather than just serving start-ups, the IWW is open to all of the small businesses in the region. Since October 1999, the IWW has helped 300 businesses, Neuman said.

Like most incubators, the IWW is a partnership between several community and economic development organizations. “It’s not our program. It’s everybody’s. We’re in this together,” Neuman said.