Homeland Security Key to New Incubator

The nation’s first incubator to focus on homeland security technologies opens this month in Annapolis, Md. The nonprofit Chesapeake Innovation Center, a program of the Anne Arundel Economic Development Corp. (AAEDC), expects to house 10 client companies by the first of next year, says Director John Elstner.

“We’ve done a lot of work over the last six months listening to the folks shaping the homeland security mission” to identify key technologies that focus on the flow, protection and use of information, Elstner says. The location in Maryland’s capital is ripe for the homeland security, communications and information technologies that incubator client firms will develop, he says. The incubator is 20 miles from the National Security Agency and the area is home to at least 10 major defense contractors. Nearby are the University of Maryland and Johns Hopkins University’s Information Security Institute. “One of the core competencies of this incubator [is] partnerships that we’ll develop,” Elstner says. For example, the center is partnering with the Johns Hopkins institute to provide clients access to the people, knowledge and technical resources of the institute and university.

Clients will pay market-rate rent that includes business assistance services. In addition, AAEDC will take an equity stake in client firms, Elstner says. The incubator will start off with 12,000 square feet of leased space and plans to add 13,000 square feet next year. Elstner anticipates reaching a capacity of 18 to 20 clients within 18 months.

The leased space won’t be the incubator’s permanent home, however. “We’re working hard to identify longer-term capital funding sources for a permanent building,” Elstner says. The incubator will operate in its current location for about three years and build a track record and support, according to Carol Kraus Lauffer, a principal with Business Cluster Development, the California-based incubator consulting firm that the AAEDC hired to launch the incubator. The county has been funding the incubator, which is seeking additional sponsors.—Carol James

Louisville Incubator Adds Site, Grant

A second location and a new grant program for start-ups have brought publicity and increased activity for the University of Louisville’s Information Technology Resource Center (iTRC) in Louisville, Ky., according to Director Jim Graham.

The new 16,000-square-foot site that opened in December doubles the space the program has available for technology start-ups. “There was a pent-up demand among companies that were looking for ‘cool’ office space in the downtown area,” Graham says. ITRC’s new site is on the second floor of a new Louisville Medical Center Development Corp.-owned building that also houses Metacyte Business Lab LLC, a life sciences incubator in which the University of Louisville is a partner.

The additional space will help the incubation program achieve self-sustainability, Graham says. ITRC’s original site on the university’s suburban Shelby campus could never achieve the critical mass it needed to become self-sustaining because of its configuration, he says. Now that the incubation program can accommodate more clients, program fees will account for about 50 percent of iTRC’s revenues, up from 33 percent; state funds account for the remainder, Graham says.

Also with an eye toward self-sustainability, Graham is seeking sponsors to support program activities. The law firm of Greenebaum Doll and McDonald PLLC in Louisville agreed to sponsor an annual award that will pay for the winning company’s first year in the incubator. The award, valued at about $7,000, got its start with Greenebaum attorney Robert L. Brown, a member of the incubator’s advisory board. Brown says the firm wants to assist companies that can contribute to the region’s economy. The winner of the first Robert L. Taylor Ideas to Action grant – named for the retired dean of the University of Louisville’s College of Business and Public Administration, who started the incubator – will be announced this month.

That announcement will continue a surge of media attention that has increased iTRC’s visibility, Graham says. “We never had a budget … to advertise,” he says, so most entrepreneurs learned about the incubator by word of mouth. iTRC received a lot of publicity last fall, when the incubator promoted the grant and opened its downtown location. And every media mention leads to more inquiries, Graham says.—CJ

Briefly...

• Forward Sioux Falls, an economic development partnership between the Sioux Falls Area Chamber of Commerce and the Sioux Falls Development Foundation, will use a $500,000 grant from the state of South Dakota to help build a nonprofit business incubator. The grant is part of $2.9 million that Forward Sioux Falls has raised for the South Dakota Technology Business Center. The 38,000-square-foot facility will offer office space, light manufacturing and limited lab space to a broad range of technology-oriented businesses. Construction began in April and the center will open in December.
• The Fort Worth MedTech Center is now Tech Fort Worth. The Fort Worth, Texas, incubator recently made the name change to communicate a broader client focus as it moves away from accepting companies solely from the medical sector of the technology industry. “The change has already been quite successful,” says Warren Webb, former Tech Fort Worth president. “We’re getting more applications … and sponsors are beginning to come on board that hadn’t considered us before.”
• Last year U-Start, a business incubator in Schenectady, N.Y., separated from Union College to become a private, nonprofit entity. The incubator opened its doors in 1999 as a joint project of Union College and private contributors relying on private-sector donations to offset operating expenses. Now, as a 501(c)(3), donors can make tax-deductible contributions. “We view this as a significant marketing advantage, especially as we seek to expand our services in the coming months,” says U-Start Director Pete McElligott.