Small Business Development, Incubators and Accelerators Strategic Assessment DISCUSSION DRAFT March 25, 2016 Submitted to: Submitted by: Community Attributes Inc. tells data-rich stories about communities that are important to decision makers. President and CEO Chris Meord Analysis Radhika Nair Katy Nally Alexandra Streamer Community Attributes Inc. 1411 4th Ave., Suite 1401 Seattle, Washington 98101 www.communityattributes.com Executive Summary Introduction Incubators are key elements of economic development through their support for innovation, entrepreneurship and new venture creation in the economy. The Port seeks to enhance its role in economic development through understanding the range of small business support organizations throughout King County, as well as the opportunities and hurdles of small business development. The Port is specically interested in small business assistance in four sectors: manufacturing, maritime, construction food production . Incubators and accelerators that cater to tech startups were consulted on a limited basis to incorporate their perspective. CAI worked with the Port to dene a list of interviewees from incubators, accelerators, maker spaces and co-working spaces based in King County. Only a few tech-focused incubators and accelerators were chosen. The nal list included 29 interviewees. Interviews were conducted over the phone and in person. Key Findings • A majority (55%) of incubators in this study are nonprot models. This is in line with national trends where a majority of business incubators are nonprot organizations focused on economic development (2012 State of the Business Incubation Industry, NBIA). • Supplemental funding contributes to program success. Only three of the incubation programs in this study operate without public sector support from local government agencies, economic development groups, colleges or universities. Sources of funding are diverse but public sector support through federal grants and local government support are key sources. • Championing and coordinating small business assistance, providing space, and funding existing incubators were the most common responses as to how the Port could promote small business development. Coordinating assistance opportunities and providing space the most common responses from interviewees. Directly funding existing incubators was the third most popular response among interviewees when asked how the Port could help small business development in King County. • Successful incubators provide more than space. Incubators are complex and demanding in terms of management and administration. Several of the established incubators CAI examined provide additional services and a scripted process of facilitation and engagement, in addition to physical space. The array communit y’s needs is a critical element of design/development while selecting clients based on t, reviewing client needs at entry, showcasing clients to the community and potential funders, and establishing eective entry and exit criteria are operational management best practices. • Funding is the top concern among entrepreneurs. Regardless of type of business or stage in growth, interviewees cited funding as the greatest challenge entrepreneurs face when trying to expand their business. Funding challenges are diverse and encompass lack of nancial planning skills, as well as low Provide Space or Land for Incubators There was broad consensus from the study that the Port was well positioned to go beyond a convening role and make a larger real estate commitment. The provision of long-term space for incubators either as land or real estate building space the Port could provide would be invaluable. A range of specic concepts for the spaces were Contents Executive Summary ........................................................................................................................................................................... ntroduction Background and Purpose .......................................... 7 Interviewee Prole The Port of Seattle & Economic Development he Port’s Mission The Role of Incubators Key Findings Recommendations Champion Small Business Assistance and Coordinate Assistance Opportunities rovide Space or Land for Incubators Appendix A. Considered Interviewees Appendix B. Interview Guide Appendix C. Interview Summaries ........................... 32 Introduction Background and Purpose The mission for the Port of Seattle establishes the agency’s commitment to creating “jobs by advancing trade and commerce, promoting industrial growth, and stimulating economic development.” In support of that mission statement, the Port of Seattle endeavored to learn more about small businesses development, specically how incubators assist small business manufacturing and contractors. Understanding the range of these support organizations, as well as the opportunities and hurdles of small business development, will help the Port enhance its role in economic development. The Port is specically interested in small business assistance in four sectors: manufacturing, maritime, construction and food production. Incubators and accelerators that cater to tech startups were consulted on a limited basis to for company growth. Several incubator operators oer additional programming based on their client needs to augment the services above. Incubators typically focus on early stage companies, helping them transition from ideation to product development. Maker Spac e. A maker space is a general term for shared spaces for industrial light manufacturing work, where people can also access shared tools, supplies, and materials. Some maker spaces oer classes and training to help workers sharpen their craft skills and business acumen. Maker spaces can provide access to equipment but they don’t typically oer the clear heights, truck access and loading facilities needed for heavy manufacturing. Co-working Space. Co-working spaces are membership-based workspaces where diverse groups of freelancers, remote workers, and other Incubator CoMotion Incubator 32% 21% 7% 18% 4% 25% IncubatorAcceleratorMaker SpaceCo-working SpaceMembership Network Small Business Advisers/Experts Exhibit 2. Proportion of Interviewees by Type *This exhibit counts interviewees twice if the organization ts into multiple categories. Exhibit 3. Location of Interviewees The Port of Seattle & Economic Development The Port’s Mission Included in the Port of Seattle’s mission is a decree to grow jobs and support its surrounding community. According to a 2013 economic impact report, 216,000 jobs were generated through Port activity, which accounted for $4.2 billion in direct wages and salaries (Martin Associates, 2014). The Port has contributed to job growth—not only through trade—but also by acquiring privately held properties and transferring them to business, public and community uses. In 2011 the Port ratied a 25-year strategic plan called the Century Agenda, which outlines the Port’s objective to add 100,000 jobs, for a total of 300,000 port-related jobs in the region. The Century Agenda states the Port will promote small business growth and workforce development through training and business opportunities specically in the maritime, trade, travel and logistics sectors. The Role of Incubators Supporting incubators and accelerators is another option for the Port to support local economic development and help generate jobs. Incubators are key elements of economic development through their support for innovation, entrepreneurship and new venture creation in the economy. Business incubators can be eective economic development tools since they create jobs and help new businesses take root and grow. Incubators can also help create linkages among rms and benet the local economy. Supplemental funding contributes to program success Incubators are rarely able to nance their operations through the rent or fees they charge. Only three of the incubation programs in this study operate without supplemental funding support from local or federal government agencies, economic development groups, colleges or universities. See for a summary of sources of supplemental funding among interviewees. Thus, this research suggests that some level of supplemental funding or investment from the public sector is needed for incubators to operate and succeed. This is especially true for incubators that focus on industries such as manufacturing and marine-related sectors since they require a relatively longer time to incubate and grow into viable businesses. Exhibit 4. Sources of Supplemental Funding Championing and coordinating small business assistance, providing space, and funding existing incubators were the most common responses as to how the Port could promote small business development Coordinating assistance opportunities and providing space the most common responses from interviewees. Directly funding existing incubators was the third most popular response among interviewees when asked how the Port could help small business development in King County. University/College 13% University/College & Private Investor 13% Government Agencies/Local Government 43% Private Investors 19% Economic Development Organiza on 6% Other Organiza ons 6% Successful incubators provide more than space Incubators are complex and demanding in terms of management and administration. Several of the established incubators CAI examined provide additional services and a scripted process of facilitation and Exhibit 5. Entry and Exit Criteria for Incubators/Accelerators Incubators/Accelerators with Entry/Exit Criteria Interviewee Entry Criteria Exit Criteria 1Kenmore Business Incubator 1. Be a new venture that is a for-pro t business in the early stages of business development. 2. Have a product or service that can be commercialized within two years. 3. Demonstrate strong market for products or services. 4. Have poten al for posi ve economic impact on the community through: • A technology, product or service deemed to have a high poten al impact in the marketplace or community. • Poten al for rapid company growth and the associated crea on of new high paying jobs. • Posi ve i mpact on the tax base of local and state government. 5. If at all possible the company should plan to remain headquartered in Kenmore, and be willing to be listed as graduates/par cipants in the program. 6. The Founder/President/CEO/Director will be located in the incubator. 7. Have a basic business plan or a wri en descrip on of the business, a market analysis, and a nancial forecast. 8. Have a mana gement team plan that demonstrates an ability to handle both the technical and managerial aspects of the business. 9. The management team is willing to seek and accept assistance from the KBI and its partners and service providers. 10. Be well-suited as a business to bene t from the KBI services, the business incubator environment, technical and business exper se. 11. Be compa ble with other par cipa nts in order to maintain a produc ve environment for all par cipants. As applicable, adhere to KBI policies regarding video/computer game content. 12. Should not be in direct compe �� on with other Incubator businesses 13. Agree to par cipate in the incubator's business assistance/networking programs and to cooperate in achieving the incuba on program's mission. 14. Willingness to a end at least six (6 ) business incuba on program educa onal seminars/workshops per year. The client may graduate from the incubator when one or more of the following achievements have been met: The new venture has launched and reaches annual sales of $1 million; The company may have been acquired by a more established rm and can con nue to foster its growth; The startup receives a successful public or private stock ering of more than $250,000; The new rm exceeds the capacity of the KBI; The company is a client for more than two years. 2McKinstry Incubator Requires rms to have gone past incuba on stage – have a lawyer, business plan and can a ord to pay rent. The selec on process involves making sure each company has robust technology with at least a tested prototype; poten al markets that are deep and strong; a clear plan to access these markets; an organiza onal team; and nancing. A yearly review of progress based on proximity to going to market (pilot programs, product/service advances, partnerships and poten al client engagement etc.). Evalua ng whether the rm is on track to launch an/or get further funding secured is key. There are no speci c revenue milestones 3Sea le Made Requires rms to have 1 FTE, sales through 1 retail outlet, manufacture/produce at least 1 product in Sea le; one or more standard product lines None. Since Sea le Made is a membership based organiza on there is no formal exit 4Fledge Accelerator For-pro t entrepreneur's team (need at least two people), the impact of its enterprise (Fledge wants to fund for- pro t businesses that address homelessness, poverty, clean tech and nancial tech - is the world signi cantly be er if this company existed?) and viability or the odds of its success as a pro table company “What are the odds that this company will earn $2 million in revenues, and if so, how long might that take?” End of 10 weeks 5CoMo on Incubator Priority for UW-a liated start-up companies through their early stages of company and product development; overall t with program By scale or growth depending on review by incubator manager 6Healthy Food Accelerator Fit of business with mission. Extensive due diligence checklist based on pro tability and cash ow.Businesses at any stage of maturity can join. No format exit - businesses are o ered support for the dura on of their choosing 7Industry Space Incubator Businesses with a manufacturing focus and ability to pay rent. Businesses at any stage of maturity can join. None 8Sea le Tilth Immigrants, refugees and low-income indviduals with limited resources in South King County interested in becoming organic farmers. End of 20 weeks 9Startup Hall Entrants selected by a mixed university/industry advisory board None Funding is the top concern among entrepreneurs Regardless of type of business or stage in growth, interviewees cited funding as the greatest challenge entrepreneurs face when trying to expand their business. Moreover, incubators and accelerators noticed a lack of understanding and awareness amongst entrepreneurs regarding sources of available funding and nancing mechanisms. Among food-focused entrepreneurs, space ranked ahead of funding as a top concern For small-scale food production, space constraints can drastically aect business growth. Many food and beverage startups, especially immigrant- and minority-owned, begin production at home and start a customer base of friends and neighbors. Moving into a larger kitchen space for these individuals can mean legitimacy Weighted ScorePercentage Money Space Industrial manufacturing incubators are the least prevalent among existing operators With the exception of Industry Space, all other manufacturing incubators in King County work with small scale Weighted ScorePercentage Initial Capital Isolation Lack of Collateral Lack of Commitment Low Creditworthiness Mentoring Access to Land Business Development Recommendations The Port has a key role to play. All but three of the incubators in this study saw an opportunity for the Port to play a role in small business assistance in King County. The Port’s patient capital and the ability to provide a long-term 32% 48% 40% 20% Space Money Facilitation or Coordination Start Incubator Don't help or unsure SpaceMoneyFacilitation or Coordination Start Incubator Dont Help or Unsure Champion Small Business Assistance and Coordinate Assistance Opportunities When asked how the Port could help small business development, coordinating or facilitating assistance opportunities was the most popular answer among interviewees. However, suggestions as to how the Port could provide this coordination varied across industries and organizations. The following suggestions outline how the Port could play a convening role to support small business development, and indicate potential partnerships. Coordinate technical assistance workshops and Provide Space or Land for Incubators The study found broad consensus that the Port is well positioned to go beyond a convening role and make a larger real estate commitment. Ten out of 25 interviewees suggested space as a way the Port could help small business development. The provision of long-term space for incubators either as land or real estate building space the Port could provide Land and building space ar Construction Incubator Utilize some of the Port’s available building space to develop a one-stop support center for small businesses in construction, architecture, engineering or similar fields. This would build on the Port’s longstanding procurement and technical assistance center for businesses interested in Port contracting opportunities. The Port is a source for contracting opportunities. As a public entity, the Port solicits construction bids and possesses Existing Eorts William Factory Small Business Incubator currently houses more than 40 companies focused on specialty trade construction, applied technologies and business services. Tenants are charged $250 Mor e than 200 companies have graduated from William Factory SBI. Of these rms, 75% are woman- or minority-owned, and historical data show an 80% success rate for all incubator graduates. At entrance, the majority of clients have one- to two-person operations with gross commercial revenues up to $50,000. Typical companies employ anywhere from 5 to 40 workers, and gross $250,000-$2 million upon graduation. Tabor 100 is an association that helps minority entrepreneurs through education and advocacy. Members of Tabor 100 are small business owners or self-employed individuals who predominantly work in the construction and trade sectors. The organization is currently working to establish a Business Development Center that would help contractors looking to start their own business. King C Coun ty. The organization anticipates renovating a 2,500 square foot space inside a YMCA in SeaTac to run a pilot kitchen incubator program with ve to 10 entrepreneurs. FIN Project Manager Kara Martin said the pilot program is still in its planning stage, but said it Manufacturing Incubator Explore opportunities for an incubator with suitable space, mentoring support, and shared tools/resources for small startup manufacturing companies. Manufacturing jobs are important to the regional economy. The region’s manufacturing sector is a vital economic engine and it continues to be critical to the diversication and strength of the economy. It represents a wide range of subsectors, including Existing Eorts Industry Space Appendix A. Considered Interviewees 9Mile Labs Ac celerator Corporation Ac tivspace Ag nes Underground Ar cturus UAV Aut odesk, Inc Ballard Labs Blu Oc Cambia Gr ove Cen ter of Excellence Global Trade & Supply Cit y of Auburn Cit y of Kenmore Business Incubator Cit y of Kent Cit y of Seattle Communit y Capital Development CoM otion Incubator Depar tment of Commerce Eastside Incuba tor Element 8 Entr epreneurs’ Organization Feder al Way Chamber of Commerce Fledge Food I nnovation Center (Global to Local) Founder I nstitute Green R iver College Gro Healthy F ood Accelerator Highline SBDC Icogene Impac Industr y Space Inno vate Washington Foundation/Alate of nite Iv y Softworks Laser Cutting NW Mck instry Innovation Center Mer cury Medical Incubator Micr osoft Ventures My Br anch Oce Oc Omax Cor poration OneRedmond Pacic Nor thwest National Laboratory Pla yhouse Arts Incubator Pr oduct Creation Studio RBC Sig nals/RBC World Watch Sea ttle Fashion Incubator Sea ttle Made Sea ttle Tilth Small Business Ac ollege SODO Maker Spac Sor ensen Group Space A Star Surf I ncubator Tabor 100 Techstars The P ioneer Collective Think Spac Up Sea Ven tures Village 88 Techlab WA Spac Washingt Washingt on State University SBDC We Wo rk William F actory Small Business Incubator Appendix B. Interview Guide King County Incubators and Accelerators Research As a public agency committed to creating jobs and growing the local economy, the Port of Seattle wants to learn more about small businesses developmen t, specifically how incubators assist small business manufacturing and contractors. Understanding the range of these support organizations, as well as the opportunities and hurdles of small business development, will help the port enhance its role in helpi ng local businesses grow. I work for Community Attributes Inc. , a consulting firm working with the port to research this topic and speak with organizations that are directly involved with incubators and smal l business development. If you’re willing to participate in this process, please respond to the questions outlined below. Your responses will be used for internal research purposes only. All of your answers will be strictly confidential. Thank you for you r time. USINESS ROFILE INFORMATION ROFILE UESTIONS Name: Date interviewed: Title: Email: Company name and d escription: Address: HQ location: Age of company: Time in Location: Number of employees: Total employees: Overview and Mission Pl ease describe your program , as related to the following: Overall mission Types of programming and support offered Total days of active training offered Duration of active support offered by the program Average class size or average number of enterprises o r entrepreneurs trained per cohort or class Any formal partnerships with investors Fees charged to incoming program participants. How is your company funded? How did you get started? What was initial source of seed funding? What is ongoing revenue model? As you work with community businesses, what are the top three issues that come up as they work to grow their business? Focus Area s Describe any focus areas (industry, geography, stage of company) you may have. Is there enough deal flow, or enough early- stage startups, in field (maritime, aerospace, UAS, outer space, medical devices) to sustain an incubator in our region? What would some of the benefits of an industry- specific incubator? What are some of the drawbacks? Feedback on Port’s Initiative e Port of Seattle is very interested in small business development, and particularly interested in incubators that support contractors and small businesses (for example, small man ufacturers in food production, marine manufacturing , general purpose manufact uring or construction ). What are your thoughts on the role the port can play on small business assistance ? What are some opportunities for the port to support small businesses, either by leveraging existing efforts or through a new initiative ( for example a maritime b usiness incubator or a construction trades support center)? Do you see any opportunities for partnership with the port on this initiative Future Plans Please describe your near - and long- term plans. Goals and Results Please share some less ons lea rned from your experience in promoting small business development. riefly describe what has worked well for certain initiative For example, specific industries need help or do better than others in the region What are some opportunities for new incubators and accelerators in King County? Are there specific industries that may need small business assistance to work well in King County? Please provide a list of program participants (including current participants and alumni) to date . (I nclude companies that may not currently operate but still participated in the program. ) escribe your results over time . Consider the following metrics when responding: Annual revenue of businesses upon exit versus entry or revenues over time Capital raised by b usinesses within two years of program completion or introductions to investors Increase in profitability Business growth in employees or units sold within two years of program completion Appendix C. Interview Summaries ��1 CoMotion Incubator Small Business Development Strategic Assessment BUSINESS PROFILE The CoMotion Incubator was founded in 2012 with the goal of continuing to fulfill University of Washington’s decree to the State to foster economic development and create jobs. CoMotion assists UW and non UW entrepreneurs , though UW startups receive pri ority . Enrollment is open to companies in all sectors. The Incubator is unique in the length of time it allows companies to develop under its guidance. “I believe in the long term approach,” said CoMotion Associate Director Elizabe th Scallon. For example, IT companies are typically incubated for 1 2 years, medically focused ones usually receive 3 5 years, and life sciences enterprises remain for 3 6 years. hese timelines are tailored to each individual company, and their duration a t the incubator depends on their readiness to leave . Mission: CoMotion Incubator provides dedicated space and facilities to support UW affiliated start ups and other companies through their early stages of company and product development. KEY TAKEAWAYS CoMo tion sees many opportunities to partner with the Port CoMotion has the space and sufficient demand for a life sciences incubator, but needs funding Food processing incubator is low hanging fruit for Port A manufacturing incubator in King County would have enough demand Incubated businesses benefit from wraparound services BUSINESS MODEL When CoMotion receives an application from a prospective startup, the incubator evaluates their business plan, their equipment needs, and the personality of the group to be sure it’s a good fit. If the product spun out of UW faculty or student research, CoMotion helps to license it out, and provides priority space in the incubator. Incubator revenue is derived from client company rent. CoMotion offers low or comparable rents: cubicles are $270 per month, private offices are $415 per month, and lab benches with equipment are $850 per month. Courses and Services. The Incubator’s on campus location makes it easier for UW faculty and graduate students to stay engaged with start up teams, and it reduce s costs and distractions by providing space inclusive of Internet access, shared office equipment, and meeting spaces. Clients work alongside each other, sharing in the joys and challenges of entrepreneurship. Proximity to UW, both its faculty and equipment, is a defining strength of the CoMotion incubator. Headquarters Seattle Address 4311 11th Ave NE #500 Time in Location Since Number of Employees ��2 Wraparound Services. Scallon said companies at CoMotion greatly value the support, mentoring and opportunities for collaboration. CoMotion programming includes speaker series, workshops, office hours, and mentorship. Additionally, it hosts several CEO Roundtable discussions throughout the year where local leaders share experiences and solutions with incubated companies. The CoMotion Incubator Idea Lab is also a key component of the Inc ubator’s services. This arm offers educational and networking events to CoMotion’s client companies. Partnerships. UW related startups likely benefitted from the University’s relationship with more than 280 specialized research centers . In addition to collaboration, UW received more than $1.24 billion in sponsored research funds in CoMotion has a strong interest in partnering with the Port. TOP ISSUES FOR SMALL BUSINESSES Scallon highlighted challenges surrounding scaling a business from an idea to a market ready product: Funding. It’s difficult for small businesses to secure funding without reliable network connections or pitching experience. Hiring. Entrepreneurs often struggle in assembling a dependable, productive team that works well together. Bus iness Development. Taking a product idea, and developing a positive user experience can be a challenge for startup companies. Production scalability is also a strategic issue multiple entrepreneurs face. HOW THE PORT CAN HEL P Scallon had several suggestions for startup markets the Port could invest in. She specifically mentioned a food and food processing incubator in Columbia City as a starting point. CoMotion has seen entrepreneurial demand for these sectors, and this sort of program would have high visibility. A construction incubator would also be an easy program to develop and implement. The manufacturing sector has a significa nt amount of entrepreneurial demand, as well. Funding. CoMotion is interested in creating a life sciences specific component of its existing program. Scallon reported that there is enough demand from entrepreneurs in that sector, and the idea she’s conside ring wouldn’t work without a UW Port partnership. The Incubator has the pipeline of entrepreneurs and the space to sustain a life sciences program, but lacks the resources to get it off the ground. LOOKING AHEAD Saturated Co working Market C oMotion contin ues to experience high demand for the type of programming it’s offering to startup enterprises, but Scallon noted waning entrepreneur interest in co working spaces. In many instances, the cost benefit analysis reveals that small businesses are better off r enting their own space when mentor expertise in a particular program isn’t up to par. ��1 Entrepreneurs’ Organization Accelerator Small Business Development Strategic Assessment BUSINESS PROFILE Entrepreneurs’ Organization Accelerator is the accelerator arm of Entrepreneurs’ Organization. Es tablished in 2005, EO Accelerator provides educational programming for entrepreneurs , teaching them about strategic planning, sales and marketing, finance , human resources and more . Mission: empower entrepreneurs with the tools they need to grow their business to more than US$1 million in sales and provide them with the skills to become better entrepreneur s and leader s. KEY TAKEAWAYS The Seattle EO Accelerator chapter currently has 25 ent re preneur members EO Accelerator is a global network, with 38 programs in 11 countries Entrepreneurs enter with at least $250,000 in revenue and must hit $1 million to graduate BUSINESS MODEL EO Accelerator is a nonprofit that works with entrepreneurs aiming to grow their business to the $1 million mark. Board Member (and CEO of Thinkspace) Peter Chee explained incoming entrepreneurs must already have at least $250,000 in revenue , or have at minimum $250,000 from investors. Chee said the EO Accelerator Seattle Chapter currently assists 25 small businesses in varying industries , and provides training sessions at Thinkspace. Training EO Accelerator taps EO members and subject matter experts to determine the yearlong curriculum for incoming entrepreneurs. Training sessions are shaped around four main pillars: strategy, sales and marketing, finance and people. Entrepreneurs in the Seattle EO Accelerator chapter pay about $2,000 a year to participate. Yearlong Programming. The EO Accelerator program runs for one year, with quarterly meetings and monthly Accountability Group sessions to keep entrepreneurs on track. Graduation. Chee explained, companies graduate the EO Accelerator w hen they achieve $1 million in revenue. Because programming lasts one year, if a company hasn’t hit the $1 million mark by then, they can continue to stay in the accelerator for up to three years. Connection to EO To qualify for the EO Accelerator, e ntre preneurs must have an interest in joining EO upon graduation. Locations Seattle, worldwide Established # of Programs 38 worldwide Target Industry None ��1 Greater Federal Way Chamber Commerce Small Business Development Strategic Assessment SMALL BUSINESS ASSIS TANCE The Greater Federal Way Chamber of Commerce is a private, nonprofit membership driven organization omprised of business es , civic organizations, educational institutions and individuals. The Chamber aims to promote regional economic prosperity in communiti es along the Seattle Tacoma business corridor by providing l eadership and advocacy for its members. Sandwiched between the Port of Seattle and the Port of Tacoma, Federal Way has a “workforce of choice” for port operations, said Federal Way Chamber CEO Reb ecca Martin. KEY TAKEAWAYS The Federal Way Chamber is currently working with the Port of Tacoma to establish a high school internship program The South Sound has a “workforce of choice” for ports More work could be done to connect education and workforce training programs with Port focused employment EXISTING EFFORTS Previous Incubator. In 2010 the Federal Way Chamber of Commerce established the South Sound Regional Business Incubator, which did not have a particular industry focus, and later changed dire ction to support tech startups. The parent organization, Jobs for South Sound changed the incubator’s focus in an effort to initiate a technology cluster in Federal Way. The incubator’s named was then changed to Cascadia Velocity and run by private consult ants. At that point, the Chamber was only partly involved its operations. In 2014 the incubator dissolved, and now the Chamber is redirecting the focus of Jobs for South Sound toward job opportunities that are “business based” said Martin. Internship Prog ram. The Chamber is currently working with the Port of Tacoma to establish a high school internship program, which would serve as the beginning end of a maritime employment feeder. Martin said the Chamber would definitely be interested in doing the same wi th the Port of Seattle. Business Retention Outreach. Martin sugg ested the Port participate in its business retention outreach effort . The Chamber currently holds monthly luncheons with Puget Sound businesses to determine what has been working for them and what can be improved. An added effect of this effort is helping to unite industry needs with education and training programs. HOW THE PORT CAN HEL P Partnership. Since the collapse of the South Sound Regional Business Incubator, the Chamber is refocusing Jobs for South Sound (the incubator’s parent organization) and actively forging partnerships and growing contacts. FEEDBACK FOR PORT Martin said the Chamber is very open to partnering with the Port and sees opportunities for collaboration on industry focused incubators. She ranked the four incubators below as follows: Maritime Federal Way sees the maritime sector as a source employment and a chance to connect bus iness operations within the Puget Sound corridor. Federal Way has the workforce , but business opportunities ��2 surrounding the ports have yet to be coordinated. And more can be done to connect education and workforce training programs with Port focused employ ment. Construction Demand for this incubator is possibly greater than expected, Martin said, because contractors and small businesses might not know about available resources . Food Production Martin said several entrepreneurs have approached the Chamber asking for a commercial kitchen space. Manufacturing This incubator had the least potential for Federal Way, which focuses primarily on light manufacturing. LOOKING AHEAD For Federal Way, the waterfront and its opportunities of employment, is “low hanging fruit,” but will require more coordination and effort to connect supply chain, business, workforce and education needs. The Chamber will continue its efforts to serve as a regional, gateway connector for businesses. ��1 Fledge Accelerator and Kick Small Business Development Strategic Assessment BUSINESS PROFILE Fledge and Kick , founded in April 2012 by Michael “Luni” Libes , o perates out of Impact Hub in Pioneer Square , and participates in the Hub’s mission to accelerate socially conscious entrepreneurs. The Fledge model has been replicated times, with locations in 13 U.S. cities and 15 different count ies. Headquarters ttle Address 220 2nd Ave S Time in Location 3.5 years Number of Employees Target Industry Socially conscious Companies Mission: Helping mission driven, for profit companies succeed. KEY TAKEAWAYS Fledge owner is wary of Port involvement in local incubator community Fledge aims to grow globally by founding branches outside the U.S. Seattle is a hotbed of socially conscious companies BUSINESS MODEL Fledge is structured like a technology incubator where the investment model is based on startup revenue rather than exits. he return on investment is not contingent on the fledgling company graduating or leaving the program at a specified time. This structure allows Fledge to be a partner in the success of each startup. Libes explained Our incentives are aligned with the founders, to find a path to sufficient, sustainable revenues. [Fledge] succeeds when the fledging succeeds in earning revenues from customers.” The incubator secures 7% ownership in each startup, which is structured as redeemable equity, in exchange for $20,000 in seed money. The startup repurchases Fledge’s shares in the company with 4% of future revenues. If a business does not succeed, nothing is owed to Fledge beyond anything already repaid. The Seattle office fields applications from around the world; half of the companies hat apply to Fledge are from outside the U.S. Accepted enterprises are enrolled in a 10 week program where they are exposed to over 300 mentors in the Fledge netwo rk who provide guidance on traditional business components sales, marketing, finance, leadership, etc. to more innovative skills, like theater stage presence and speech coaching. Courses and Services. In addition to the aforementioned regular Fledge programming, the incubator also offers ‘Kick’ sessions for businesses who were denied entry into the 10 week sessions. Kick applies to 97% of entrepreneurs who were initially turned away. The course itself is composed of 12 sessions and workshops over 6 weeks, a nd prepares companies to enter the accelerator stage. Each participant goes through an intensive restructuring process where they have the option to reconstruct their business from scratch. Kick assists entrepreneurs in uncovering core problems, identifyin g solutions, and building a “Minimum Valuable Product” (MVP). At the end of the sessions, individuals present ��2 their companies and ideas to an audience of potential investors and customers with the goal of persuading the aforementioned group to believe in t heir business. The incubator also attempted FledgeX a one time experiment in f all 2015 to determine if the 10 week Fledge programming could be replicated entirely online. 13 companies participated 9 different countries were represented, and 3 were from Seattle. FledgeX only lasted 8 weeks, and while Libes believes it was successful, the level of engagement of the in person course was difficult to duplicate online. Results Fledge has 39 program graduate companies, most of which are outside the U.S. So far, the incubator isn’t profitable yet , but Libes expects it to be in the future . It’s funded by 30 40 angel investors in Seattle who donated about $1 million during the first round of funding. Fledge expects needing another million in the coming months. TOP ISSUES FOR SMALL BUSINESSES Overall, Libes has noticed that many entrepreneurs lack necessary knowledge abou t best practices and financing. He has also noticed that many entrepreneur s lack confidence about their ideas and business decisions. Funding. Entrepreneurs have little to no experience raising money. Sales Skills New businesses don’t have hands on experience in sales. Entrepreneurs tend to be wary of overselling their products and, subsequently, afraid of closing a sale. Finance Best Practices The leadership in startups , especially those focused on social good , typically don’ t have any background in finance. Narrowed Markets Entrepreneurs shouldn’t limit the scope of their audience, and should look for entrepreneurial ventures outside the U.S. HOW THE PORT CAN HEL P Overall, Libes expressed hesitation about the Port developing an incubator because government involvement can be a significant barrier. Very few incubators and acc elerators are funded by government grants; potential incubates don’t want to deal with government bureaucracy. Privately owned incubators can take money from investors, and obtain higher return on investments than publicly held companies can. Diversify Assistance. Based on his experience, Libes stated there aren’t enough entrepreneurs within a single sector in a small geo graphic area to sustain an incubator. He recommends the Port consider curating startups from multiple market sectors. Local Support. Libes said t he Port should support local incubators like Surf and Impact Hub, and ensure local small businesses don’t falter when faced with new competition . Support Underprivileged Entrepreneurs. The Port should consider helping to make Craft3 loans possible for s mall businesses, which the Small Business Association won’t do. Partnerships. Fledge currently has 30 40 angel investors who fund invest ments in star tups and day to day programming, and is not looking for other partners at this time. LOOKING AHEAD Program Expansion Fledge aims to replicate its investment model in more cities in the region. Once new locations are established, Libes intends to begin hiring. ��1 BUSINESS PROFILE The Food Innovation Network (FIN) is the incubation arm of SeaTac based Global to Local (GTL). GTL was founded in 2010 through a partnership between Swedish Health Services, HealthPoint, Public Health Seattle & King County, the Washington Global Health Alliance, and the Cities of SeaTac and Tukwila. These entities recognized that access to good health is predicated on economic opportunity, education, and job skills. Twice as many residents in SeaTac and Tukwila live below the federal poverty line than in the rest of King County, indicating a concentr ated need for economic development in the area. FIN unites public and private partners to address health and income disparities grow ing the local food sector through job creation and entrepreneurship opportunities in the SeaTac and Tukwila communities. FIN was founded in 2012, but did not receive its first grant until 2014. At this point, FIN is in a targeted planning stage to build a long term kitchen incubator . Project Manager Kara Martin is leading FIN through the implementation phase. Mission: Headquarters aTac Address 2800 S 192nd St #104 Time in Location Since Number of Employees 1 FTE and 1 Contractor Target Industry Food Production ��2 local entrepreneurs with these assets. Training providers offer a series of 6 wee k workshops where participants graduate with a business plan. Classes last about 2 hours each, and are limited to 10 entrepreneurs each. Partnerships. FIN has many partners that provide funding, including inchot University , Boeing, and the Seattle Foundation Martin explained FIN currently has a variety of trainers o provide business co unse ling for entrepreneurs but could use assistance from the Port to launch new businesses into the food industry. TOP ISSUES FOR SMALL BUSINESSES Martin described sever al barriers to food industry entrepreneurs. Kitchen Space Renting and permitting a space for food production can be unaffordable to many startups. Startup Fees Capital costs for equipment can prevent entrepreneurs from expanding production. ESL Training For disadvantaged entrepreneurs, English is often a second language. Individuals have to be fluent enough to participate in many FIN workshops. Pr oject Feast, one of FIN ’s partners, offers a class geared toward people with a lower level of English profic iency that teaches participants Western terms for working in an American kitchen. HOW THE PORT CAN HEL P Martin oted the strong demand for an incubator that caters to commer cial food production, and highlighted several ways the Port could as sist these businesses. Space There is a lack of food processing and commercial production facilities entrepreneurs can utilize in the early stages of business development. Market Opportunities If entrepreneurs are able to scale production, they frequently don’t have access to a robust network of connections through which to market their product. The Port could help individuals tap into the right market channels by providing introductions and contacts to startups. Regulation Assistance After indi viduals acquire a business license for food production, they’re often overwhelmed by the requirements they must fulfill in order to sell their food through established market channels . FIN has noticed food labeling causes a significant amount of confusion, for example. LOOKING AHEAD Following Demand A recent kitchen incubator feasibility study revealed the level of entrepreneur demand and market would support a kitchen incubator, however, there is a lack of commercial kitchen space in South King C ounty. ��1 Healthy Food Accelerator Small Business Development Strategic Assessment BUSINESS PROFILE Launched in 2015, Healthy Food Accelerator (HFA) helps early stage food companies grow from a concept to distribution. Thus far, HFA has helped develop four companies, including POP! Gourmet, which now sells at retail outlets such as Starbucks and Costco. Headquarters Tukwila, POP! Gourmet Address 13400 Interurban Ave South Established Target Industry Food Mission: HFA aims to help startups and mid stage food companies that produce and sell vegan, vegetarian, natural, Non GMO and organic foods to grow into successful and sustainable businesses. KEY TAKEAWAYS FA in vests up to $50,000 per food focused venture Partner David Israel is the founder and CEO of Pop! Gourmet FA is strongly considering running a kitchen space, and has looked at a few possible facilities BUSINESS MODEL HFA has several partners who bring food enterprise expertise or a background in business and finance. David Israel, the founder and CEO of Pop! Gourmet has first hand experience of running and growing a startup. As a partner at HHA, Israel, entrepreneurs benefit from his experien ce in distributing to large retailers like Costco, Krogers, Starbuck and Walmart. As an accelerator, HFA accepts between four to six applicants at a time, and provides lifetime assistance. HFA Partner Amandeep Kapoor explained there isn t a formal graduation ” from the accelerator. Training. apoor said HFA approaches entrepreneurial training like and internship program. He said their model was similar to an apprentice shadowing a doctor. nvestment H FA invests up to $50,000 in selected small business ventures. Assistance covers topics such as company organization, capital infusion, product validation and development, marketing, manufac turing, distribution and financial management . itchen Space K apoo r said HFA is strongly considering running its own kitchen facility and has begun looking a suitable spaces. He said striking the right balance between entrepreneurs and established food companies w ill b e key. HOW THE PORT CAN HEL P ood Focus K apoor said it would behoove the Port to et involved in the region s rich food culture to help encourage food related enterprises . ��1 Highline Small Business Development Center Small Business Development Strategic Assessment SMALL BUSINESS ASSIS TANCE he Small Business Development Center at Highline Community College supports local business owners to build profitable businesses. Since 2002, the SBDC has been helping promising startups and established small businesses reach the next level by providing n o cost business consulting. KEY TAKEAWAYS t is important the Port play a role in small business assistance given it’s such a large organization. Land is a key thing the Port could contribute . The Port’s focus on industry specific incubators is a good idea. Successful incubators are specific and focused on one industry. A maritime or manufacturing incubator sound like the best ideas for the Port given alignment with Port activities and the high wage jobs that would be created . For food processing and construction, the Port could partner with the Food Innovation Network and ongoing efforts by the Port to provide technical procurement assistance for contracting. Access to marketing channels is a key need for small businesses. Another challenge is the lack of creditworthiness. An important practice for incubator success is the presence of a good sorting mechanism or clear criteria on entry and exit. Incubators are rarely self financing. They tend to need outside money so there must be an ongoing dollar commitment. Currently the Port has an ongoing commitment to help minority , women owned and disadvantaged businesses. This should be a continued area of focus. EXISTING EFFORTS he SBDC at Highline specializes in providing business and training services to entrepreneurs and existing businesses. The center provides: Knowledgeable, trusted and confidential one on one advice on all aspects of business A link to 23 other SBDC centers in the stat ewide network for additional advice Guidance on the purchase of an existing business or a franchise Assistance in finding the best sources of capital to grow businesses Support for established businesses ready to take their business to the next level entification of improvement opportunities for existing businesses Matching businesses with resources that can accelerate their success trajectory through referrals Information about training and funding opportunities ��2 The Small Business Development Center serves a diverse population. The population served consists of women owned businesses (38%), African American owned businesses (21%), veteran owned businesses (16%), Asian owned businesses (10%) and Hispanic owned businesses (4%). A related initiative, ca lled StartZone serves those not yet ready for SBDC services, such as recent immigrants or refugees. By design, the assistance center is not focused on companies at a certain stage of maturity or in a specific sector. Assistance is provided to entrepreneur s in the community at any stage in their business. HOW THE PORT CAN HEL P hockley had several suggestions for areas in which the Port could invest. His main suggestion was for the Port to provide land or space for small business incubation. He specifically mentioned manufacturing and maritime incubators as the best fit for the Port The relatively higher wage jobs these sectors create and the fit with Port activities are significant advantages. Highline SBDC has seen entrepreneurial demand for these sectors, and this sort of program would have high chance of success . Shockley also wanted the Port to continue its existing efforts to help small, disadvantaged businesses through its Technical Procurement Assistance Center. Shockley reported ther e was demand from entrepreneurs for commercial kitchens as well as co packing facilities but expressed concern jobs created in food processing may not pay a living wage. Entrepreneur Challenges In his experience, small business entrepreneurs, typically s truggle most with sales and marketing. In many cases, he has encountered entrepreneurs who lack a clearly differentiated product or the ability market or sell their products through retail or other channels. Entrepreneurs also struggle with access to capit al because of their lack of creditworthiness. FEEDBACK FOR PORT hockley thought the Port could play an important role in small business assistance. Maritime This is a sector that creates relatively higher wage jobs and is well aligned with the Port’s activities. Manufacturing. Similar to maritime, manufacturing is also a sector with the potential to create living wage jobs that is well aligned with the Port’s activities. Construction. Building on existing efforts from the Port through its procurement technical assistance center for businesses interested in contracting opportunities with the Port is a good idea. Food Production. There seems to be a lot of demand for this but the jobs created by food processing may not be as high wage as manufacturing or maritime jobs. In addition to commercial kitchens, co packing facilities are also in demand. The Food Innovation Network will be a good partner for the Port in this specific effort. ��1 Impact HUB Small Business Development Strategic Assessment BUSINESS PROFILE Brian Howe, the founder of Impact Hub Seattle, was working in social impact investing, and wanted to create a space that brought small enterprises and entrepreneurs together. Impact Hub Seattle was established in July 2012, and the Bellevue branch was open ed almost 3 and a half years later in November 2015. There are a total of 70 Impact H ubs in the worldwide network. Mission: To support entrepreneurs, not for profit and for profit organizations that want to have positive social impact through their enterprises. Between the two locations, Impact Hub has about 700 individual members with an average of roughly 1 organization per person, which translates to a little less than 700 separate enterprises. Individuals running a single person effort often feel isolated or lonely, which can derail their endeavors. Impact’s spaces aim to combat seclusion by fostering a strong sense of community and collaboration in communal working environments. KEY TAKEAWAYS Impact Hub in Be llevue needs to relocate soo n because the building will be demolished Local businesses can host events at Impact Hub Impact Hub Seattle is partnering with Technology Access Foundation to support youth entrepreneurship BUSINESS MODEL Impact Hub cultivates socially conscious entreprene urs that aspire to have a lasting, positive social impact. Unitus Seed Fund, a company that strives to invest in and support smaller companies and teams that have the potential to scale their services to benefit the masses, is one example of a company that operates out of the Seattle Impact Hub. The Hubs are funded through membership fees and office space rentals, as well as on site corporate events. Membership fees start at $35 per month on the low end , while dedicated workspace in their otherwise open sea ting environment is about $400 $500 per month . The Hubs generate around $1.5 million in revenue annually. While the national network of Impact Hub s provided a considerable amount of best practices and business model support, the Seattle Impact Hub didn’t r eceive much material startup support. The Seattle Hub was a joint venture between HUB Seattle, the Bainbridge Graduate Institute (BGI), and Social Venture Partners. BGI offers a MBA in sustainable business and other certif icate programs on site, bringing l ike minded students and entrepreneurs together. In addition to the co working spaces offered to members, fixed office rentals are also available to socially conscious companies, such as Unitus Seed Fund, mentioned above. Headquarters Seattle Address 220 2nd Ave. S. Time in Location Since July 2012 Number of Employees Target Industry Socially conscious companies Headquarters Bellevue Address 555 116th Ave. NE #242 Time in Location Since November 2015 Number of Employees ��2 Courses and Services. It’s up to me mbers to decide how many weekly active training days and events they would like to attend. Training includes instruction on best practices, classes on how to scale businesses to match market demand, and coaching members on how to find healthcare coverage f or themselves and their future employees. Impact Hub also facilitates networking events to connect small businesses to like minded, established firms. Physical Space BGI, SVP, and numerous other companies and entrepreneurs share 30,000 square feet of co working office space. Partnerships. The Impact Hub is currently working with Technology Access Foundation that is focused on entrepreneurship and young people. The Hub is assisting with business strategies . TOP ISSUES FOR SMALL BUSINESSES Social Capital. The Int erim CEO, Peter Temes, communicated how integral social capital is to small business success. Entrepreneurs need a dependabl e network of peers and mentors an inf ormal community to support their missions. Social and intellectual capital are the engines that allows small businesses to keep growing when funding runs out. Temes also spoke on the ripple effects of social consciousness and capital the indirect and induc ed economic impacts that result from a successful socially beneficial business are profound. For example, i f one social firm prospers, the accounting business that serves this enterprise grows, which supports the accounting firm employees’ favorite restaur ant. The employees and their families represented in all of these business relationships thrive. HOW THE PORT CAN HEL P Space The Bellevue Impact Hub is currently located in the Lincoln Center building slated for demolition to make way for the Bellevue lig ht rail line. The Hub is currently paying below market price for this space, and cannot afford to remain in Bellevue and pay at market rent . Peter Temes mentioned hearing that the Port is potentially looking to develop space in Bellevue, and believes the P ort and Impact Hub would make great partners in this endeavor. If the Port could supply space of any kind traditional workspace, a hanger, boat, basin, or warehouse the Hub could continue its mission in Bellevue. Scale Incubators and accelerators have to prove their value over time. When the right model is found, there need s to be a very large set of participating entrepreneurs that may or may not succeed. The more commitment individuals have to operate an incubator or accelerator, the easier it is to build a model with minimal cost, which increases the probability that participating enterprises will succeed. ��1 Industry Space Small Business Development Strategic Assessment BUSINESS PROFILE Seattle Mayor, Ed Murray, awarded $100,000 to Seattle Industry Space to c reate an incubator to assist new, local manufacturing businesses. The grant was funded by Seattle’s New Markets Tax Credit (NMTC) program. NMTCs attract private investment for development and other projects benefitting low income neighborhoods. In 2008, the City’s Office of Economic Development created the Seattle Investment Fund (SIF) to participate in the NMTC program. Stadium Place, The Bullitt Cente r, and the Pike Place Market renovation are all projects that utilized these tax credits . Fees on these investment projects have allowed the City and SIF to support small business growth, such as façade improvements for businesses in the Chinatown/International District . Small business lending activity is also made possible through the Office of Economic Development and the National Development Council’s Grow Seattle Fund. The Seattle manufacturing industry encapsulates a variety of subsectors, ranging from industrial machinery to printing and publishing to food and beverage production. Some types of manufacturers require large warehouses, but many of them require 5,000 squa re feet or less. Industry Space was borne out of evidence of a lack of supply for smaller spaces. Owner Johnny Bianchi used some of his own capital in combination with the aforementioned grant to found Industry Space. Located in an abandoned metal factory in South Park, Industry Space currently houses 3 tenant companies after opening its doors at the beginning of 2016. Mission: To create an incubator focused on the manufacturing industry that consists of co located, intentionally selected tenants with th e goal of encouraging the manufacturing of complementary goods, networking, sharing of information, and mentoring. Headquarters Seattle Address 8009 7th Ave S Time in Location Since January 2016 Number of Employees 0 (Owner manages property) Target Industry Manufacturing ��2 KEY TAKEAWAYS Industry Space tenants require large facilities equipped to handle heavy machinery The Port could provide industrial manufacturing space Industry Space plans on expanding into SODO or Ballard Industry Space tenants pay only $0.85 per square foot per month BUSINESS MODEL Industry Space’s revenue is derived from client company rent. Tenants can rent industrial space or office space or both. Industrial space is approximately $0.85 per square foot per month, and office space is rented for $500 per month. The incubator is flexible on lease terms, but short term contracts are more expensive. Typical lease terms range from 1 to 5 years. Courses and Services. The Industry Space site offers tenants a fully functional industrial space, with features like heavy lifting capacity, truck access, compressed air, and access to heavy power. Because it’s so early in the incubator’s tenur e, Industry Space does not currently offer programming for start ups , but is interested in organizing workshops and courses in the future if tenants express interest. Physical Space . Industry Space offers tenants 47,500 square feet of industrial and office space in the South Park neighborhood. Suites offered to manufacturing incubators include clear heights and loading hooks. The building itself has easy truck access and loading and unloading facilities. A shared kitchen is also available for common use. Pa rtnerships. Industry Space does not have any partners to date, but is interested in partnering with the Port once it has some concrete ideas and plans for its incubator. Bianchi is not interested in ideation, but would be happy to work with the Port to ens ure that future incubator space aligns with the needs of the entrepreneurs it aims to serve. ISSUES FOR SMALL BUS INESSES Functional Space Manufacturing companies require expensive and complex space, infrastructure, and equipment needs. When these are not provides, manufacturing startups have high up front costs, making it difficult for small businesses in this sector to take root. There is definitely a shortage incubators that offer the space and amenities Industry Space provides to its tenants. Bianch i refereed to a shortage of suitable spaces in the below 5000 SF range as the most in demand by small manufacturing entrepreneurs. HOW THE PORT CAN HEL P Space Manufacturing companies in need of industrial workspace struggle to find functional sites. Attr ibutes such as clear heights, truck access, loading zones, and distance from residential uses are frequently difficult for tenants to find. LOOKING AHEAD Expansion Industry Space is interested in expanding to more locations in SoDo or Ballard. Bianchi is currently looking for properties and deals that would work. ��1 enmore Business Incubator Small Business Development Strategic Assessment BUSINESS PROFILE The City of Kenmore founded the Kenmore Business I cubator to support an innovative community spirit and foster startup en trepreneurs. Tenants pay a monthly fee for co- working space and membership in cludes a suite of services such as mentorship , business development support, networking events, workshops and seminars. The ncubator operates out of a 3,000 uare f oo t office space in dow ntown Kenmore. Mission: Kenmore Business Incubator aims to nurture our homegrown businesses and to get Kenmore on the map as a place where innovative biz want to locate . KEY TAKEAWAYS Kenmore City Council is considering whether to maintain the on site incubator or only support virt ual services Tenants focus on technology, healthcare, finance and business services Co- sponsoring the incubator s seminar series would s upport the Port s regional ini tiatives Having an incubator downtown reinf orces Kenmore s emphasis on innovation BUSINESS MODEL he Kenmore Business Incub ator offers working space s from a dedicated workstation to private offices. It currently support about 25 businesses on site, and several more though its virtual services. Funding from the City of Kenmore cover s the incubator s base rent and membership fees make up the rest of the operating budge t. In January 2016 the incubator was nearly at capacity in terms of tenants, which took about two years to achieve. Diversity. There is no particular industry focus among tenant, however current members w ork in technolog y, finance heal thcare and business services. Nancy Ousley ssistant ity m anager aid the diverse group of entrepreneurs was helpful for businesses to learn from one another and establish partnerships. Courses and Services. Membership includes individual mentoring with a program consultant, access to a seminar series on best business practices, and group co nsulting. The incubator also holds networking and other informal events. Virtual Membership. Throug he incuba tor s virtual option, entrepreneurs forego the on site office space, but still have the opportunity to meet with a business consultant and take part in group consu lting. TOP ISSUES FOR SMALL BUSINESSES trategy O ften entrepreneurs and small business owners to have the time to think long term and strategical ly about growing their operations. Headquarters Kenmore Address 7204 NE 175th Street Time in Location Since Number of Employees 1 FTE ��2 solation O usley said she s noticed entrepreneurs gravitate toward co working spaces because a home office can be isolating. Lack of outside perspective A strength of the Kenmore Business Incubator is its diverse set of ten ants, Ousley said . Although members focus on different industries, each share commonalities as business owners and can learn from each other. HOW THE PORT CAN HEL P Ousley listed several ways in which the Port could provide small business assistance. nd, even though Kenmore doesn t share Puget So und waterfront , Ousley noted Kenmore was still a community that supports the Port and its activities. echnical Assistance W hile the incubator currently offers technical assistance services for its tena s, Ousley said representatives from the Port could aug ment existing w orkshops. Sponsorship. The Port could lend expertise to share through the incubator s seminar series. Co sponsoring these kinds of events would r inforce the Port s regional reach and objectives. pace T he Kenmore City C uncil is considering whether to maintain the on site incubator or only support virtual services. Ou sley suggested one option is the Port could provide the co working space. LOOKING AHEAD On site versus Virtual T he Kenmore City Council is exploring alternative models for running its incubator. Options include keeping the on site co working space, switching to o nly virtual programs, or concentrating on business consulting. The city lans to explor e partnerships for mai ntaining the incubator and its current services ��1 McKinstry I nnovation Center Small Business Development Strategic Assessment BUSINESS PROFILE The McKinstry Innovation Center was founded in to with a goal to focus on startup s in the clean tech and life sciences sectors . The Center has since expanded its focus to include businesses in the education sector. The Center functions more like an accelerator than an incubator. Mission: The McKinstry Innovation Center provides dedicated space and facilities to scale and grow companies past the incubation stage in the clean tech, life scie nces and education sectors. KEY TAKEAWAYS The Port has a key role to play as both a convener as well as a provider of space/land Food processing incubator is an important sector and a good fit for Port A manufacturing incubator in King County would have enough demand BUSINESS MODEL Entry and Exit Criteria Enrollment in the McKinstry Innovation Center is open to firms at various stages of maturity but they must have come past their infancy or early incubation stage and have a business plan and ability to pay market rent. The McKinstry Innovation Center houses a mix of tenants from established companies with proven ideas who use the facility as their base of operations to newly formed companies and one person offices that benefit from the experienced assistance of the Center’s mentoring team. The Center conducts a yearly review of progress of its tenants based on proximity to going to market (pilot programs, product/service advances, partnerships and potential client engagement etc.). Evaluating whether the firm is on track to launch an d/ or get further funding secured is key. Courses and Services. Amenities provide d include office spaces, meeting rooms, access to common spaces, and the use of McKinstry's manufacturing areas for prototype development, demonst ration space and mock up demonstration platforms for testing. Tenants are charge d market rate rent for class A office space for their individual offi ce space alone. Wraparound Services. David Allen of McKinstry said companies at the Innovation Center greatly value the opportunity to mix and gather feedback from McKinstry’s thought leaders and skilled tradespeople . The ability to produce pilot products or prototypes and gather feedback from industry experts at McKinstry is a valuable service. Headquarters Seattle Address 210 S. Hudson St. Seattle, WA Time in Location Since 2010 in Seattle, 2012 in Spokane Number of Employees ��2 Partnersh ips. McKinstry has par tnered with the Gates Foundation to bring the education initiative, the STEM center , to the Innovation Center TOP ISSUES FOR SMALL BUSINESSES Allen highlighted challenges surrounding scaling a business from an idea to a market ready product: Lack of Opportunities to Test Prototypes or Pilot Projects It’s difficult for small businesses to test their ideas without the ability to produce prototypes and gather feedback from industry experts on it. Funding. Entrepreneurs often struggle t o access capital and investor networks . HOW THE PORT CAN HEL P Space. Allen had several suggestions for startup markets the Port could invest in. specifically mentioned a food and food processing incubator as a n important and timely investment the Port could make McKinstry has seen entrepreneurial demand for these sectors, and this sort of program would have high impact The manufacturing and marine sector has a significant amount of entrepreneurial demand, as well. The construction incubator program wa cited as a program with potential but a crowded field of current incubator operators was seen as a potential deterrent . ��1 Seattle Made Small Business Development Strategic Assessment BUSINESS PROFILE Christin e Hanna and Erin Nelson, dir ectors and founders of the Sea tt le Good Business Network (SGBN) , also run Seattle Made , which supports small, local manufacturers and producers. Seattle Made operates like an accelerator and was modeled after the successful SF Made in San Francisco. Hanna said Seattle Made’s mission to support small, urban producers is imperative because they provide dependable, living wage employment. She added this effort is especially important now, as the local business climate is becoming bifurcated, and moving toward an analyst - versus service based economy. Mission: To promote a sustainable, local economy by inspiring people to produce, invest and buy locally. According to Hanna, local production is vital to Seattle’s economy. The city’s urban manufacturing doesn’t just encompass the logistics and maritime subsectors; there are hundreds of small scale manufacturing businesses that require assistance. Members of Seattle Made range from propeller producers to chocolate manufacturers. KEY TAKEAWAYS About 40% of Seattle Made member companies say they need more space to expand production when they first join About 40 percent of Seattle Made members focus on food and beverage production Seattle Made is currently doing a landscape study of a potential garment district in Seattle The Port should move away from a positive ROI model and focus more on economic development BUSINESS MODEL Seattle Made caters to enterprises that have made it past the incubation phase. Membership criteria includes: manufacturing or producing one or more physical product in Seattle ; offering one or more standard product lines ; employing at least one full time employee ; and, provided the enterprise produces cons umer products, selling through at least one retail outlet or online. Entrepreneurs are also asked when they expect to need capital, production space, and a workforce. There is no time limit on membership, which is free thanks to investors and partnerships. Seattle Made has a contract with the City of Seattle’ usiness Retention and Expansion P rogram , where the c ity partners with local organizations to support business development, such as helping enterprises se cure space or permits. Seattle Made acts as a middle man, and is paid by the ity to make connections. Seattle Made is also a member of t he Urban Manufacturing Alliance a national collective of nonprofit, for profit, and governmental stakeholders focused on growing manufacturing businesses and creating diverse living wage jobs. Headquarters Seattle Address 220 2nd Ave. S. Time in Location Since March 2015 Number of Employees 1.5 FTE Target Industries Manufacturing ��2 Courses and Services. Seattle Made works like an accelerator and offers somewhat established businesses branding and marketing training, funding, and assistance in locating the rig ht space for business growth. The organization also assists businesses with outreach and publicity. In one instance, KOMO TV, a founding partner, did a segment called Seattle Made Minute and featured six member companies. During the 2015 holiday season, Seattle Made also launched a gift card for shoppers to buy its members’ products. Capital. Companies that join Seattle Made typically seek loans that fall below the threshold of tradition bank loans. To assist its members, Seattle Made has partnered with Community Sourced Capital, an organization that links entrepreneurs with local investors, and provides a platform for small businesses to run funding campaigns. In addition, Seattle Made implemented the Seattle Made Matching Fund. Together, member compan y would raise $10,000 through Community Sourced Capital, and the Seattle Made Matching Fund would supply other $10,000. Physical Space Seattle Made operates out of Impact Hub Seattle ts 300 member s have their own spaces. Partnerships. F ounding partne rs includ e the City of Seattle, BECU, Vulcan, and KOMO4 . TOP ISSUES FOR SMALL BUSINESSES Space About 40% of Seattle Made member companies say they need more space to expand production when they first join. Sales. Entrepreneurs play many or all roles in t he earlier stages of their business, but typically have the heaviest hand in sales and marketing before joining Seattle Made. Company founders often need coaching about how to approach these topics as they attempt to scale their businesses. Scaling Young companies need assistance with the growing pains of scaling, both in the difficulties of managing growth and in the logistics of market expansion. Capital. Members not only struggle with lack of capital, but also with what level of revenue is appropriate f or entrepreneurs and their enterprises at various stages in their growth. HOW THE PORT CAN HEL P If the Port can move away from a positive return on investment model and focus more on economic development, it could have a sizeable impact on Seattle’s manufa cturing sector , said Hana. The Port has land and other valuable assets, and could create a release valve for small scale production space. Space Young businesses are in need of long term space solutions. Manufacturing Incubator About 40 percent of Seatt le Made members focus on food and beverage production. To join Seattle Made, companies must have at least one full time employee, and sell their product in at least one retail outlet. Companies in their infancy are therefore rejected. Hanna explained , whil e there is plenty of demand, there is a lack of local, food focused incubators to where she can refer companies that are too new to join Seattle Made. Demand Factors. Overall, Hanna urge d the Port to consider multiple demand factors before deciding to act. A cou ple questions to consider are: What sector(s) should th e Port’s space be geared toward (i.e. what equipment is needed)? Do businesses want to be surrounded by other businesses in similar sectors or should there be a mix? LOOKING AHEAD Market Research Seattle Made is committed to meeting the needs of its member companies and ideal candidates. Because manufacturing has a wide array of subsectors, different manufacturers and producers have vastly different equipment and space needs. For example, to meet their individual needs, Seattle Made is currently doing a landscape study of a potential garment district to learn more about the textile sector in Seattle. ��1 Seattle Tilth Farm Works Small Business Development Strategic Assessment BUSINESS PROFILE Seattle Tilth is a nonprofit dedicated to educating and empowering the community to build a sustainable and equitable local food system. The organization’s incubator program, Seattle Tilth Farm Works , provides farm business training and support to immigrants, refugees, and people with limited resources in South King County. Participants attend farm and business trainings, tour neighboring farm operations, and gain hands on experience growing and harvesting food using organic practices. Headquarters Seattle Address 4649 Sunnyside Ave N, #100 Time in Location years Number of Employees Target Industry Small , Disadvantaged Farmers Mission: To inspire and educate people to safeguard our natural resources while building an equitable and sustainable food system. KEY TAKEAWAYS Access to infrastructure and land are crucial to growing a farming enterprise Port could help connect farmers with distribution and market channels Seattle Tilth’s incubator i s interested in securing more land for its farmer participants BUSINESS MODEL Each year Seattle Tilth Farm Works accepts eight to 10 new f armers as part of a new cohort. Participants in good standing have the opportunity to continue accessing the land base, infrastructure and ongoing technical assistance in an effort to further their enterprises In 2015, 20 farm enterprises operated at the incubator site 10 were new farm ers and 10 were returning farmers. Courses and Services. The Seattle Tilth Farm Works provides an experiential learning Organic Farm Educational Program, which focuses on organic farm practices, small business management, and marketing. Participants attend farm and business trainings, tour neighboring farm operations, and gain hands on experience growing and harvesting food using organic practices. The program runs for 20 weeks from February to June each year. Cohorts of 8 10 farmers meet twice per week thr oughout the duration of the program. Technical assistance, land base, infrastructure, and marketing outlets continue to be available to farmers in good standing after the program concludes. Farmers currently operate on a micro farm scale. Most farmers star t with one- eighth of an acre; some returning farmers operate 1 acre. Current program participants and graduates share Seattle Tilth farm land in order to eliminate many startup capital costs, such as equipment, and to create a knowledge sharing environment. ��2 Fees. The fee structure is a sliding scale, and is determined by the enrolling farmer’s household income and number of dependents. Additionally, a decreasing subsidy structure is in place first year farmers receive the highest level of subsidy and it decreases over time as their businesses grow. After 7 years, farmers are paying full market rates. Many farmers draw on nano loans (up to $1,500) from Seattle Tilth. These loans are repaid throughout the season as product sold through the Produce Food Hub. Physical Space Seattle Tilth’s main offices are in Wallingford , where they hold courses and classes for incubatees and embers. Results Success varies from farmer to farmer, but the program has positive results overall. Strong farmers see a 200% increase in reven ue over 3 years. As a whole, program participants have totaled more than a 300% increase from 2013. The average gross revenue for a first year farmer is $2,700, while returning farmers average $9,300 in gross revenue. Average gross sales of the farmers in the program increased by 137%. Partnerships. Seattle Tilth does not currently have any formal partnerships, but would be interested in partnering with the Port. TOP ISSUES FOR SMALL BUSINESSES arriers small farmers when growing their businesses include : Access to Markets Entrepreneurial farmers have limited experience in selling their produce. Capital Small farmers lack the funds required to invest in equipment, infrastructure, or marketing. Land Thi s goes hand in hand with funding new farmers often can’t afford to acquire more land to increase the scale of production. HOW THE PORT CAN HEL P Infrastructure Access to infrastructure, such as washing/packing facilities, food processing equipment, and cold storage, is very important to the growth of the Seattle Tilth Program Land Entrepreneurial farmers need an appropriate land base for farming/aggregation. If the Port could provide this, Seattle Tilth could increase the number of farmers it could accommodate in the Organic Farming cohorts. Connections The Port could connect Seattle Tilth Produce and its farmers with potential small scale buyers interested in locally and organically grown produce. LOOKING AHEAD Land In order to continue operating within the farm hub model, the incubator component of Seattle Tilth needs to acquire a larger land base. This would mean the farmers can scale up business and continue to benefit from the support systems (i.e. technical assistance, in place infrastructure, and marketing channels). The idea is that farmers would not need to make large individual investments for land, equipment, or infrastructure, and an agency would make market rate leases and/or piece meal rates available. Market Expansion The next steps for Seattle Tilth Produce Food Hub include growing ts direct market CSA , and pursuing wholesale/bulk markets that it with the scale of its growers. ��1 ODO Makerspace Small Business Development Strategic Assessment BUSINESS PROFILE For co founder Eric Renn, SODO Makerspace was his chance to develop a self sufficient community. The 3,000 square foot space behind a doughnut shop in SODO acts as a center for supporting projects in advanced manufacturing in an effort to help people “solve local problems.” Mission: To educate and incubate the general public on advanced manufacturing technology to make new products to solve local problems. KEY TAKEAWAYS SODO Makerspace asked the Port to provide sp ace —a ny available buildings or unoccupied rooms t o house manufacturing machinery SODO Makerspace received grant funding from the City of Seattle’s Office of Economic Development to commence a 12 week course or a small co hort ne of ODO Maker space ’s first incubator successes was in 2015 with the small business Rainworks BUSINESS MODEL enn became intrigued by the “maker movement” in September 2013 and traveled for three months to visit and investigate established maker spaces. From there, he drew from concepts he’d learned and brought his new found know ledge back to Seattle. He secured a space in the back of a restaurant in his neighborhood, and invited others through posts online to utilize the space. Eventually his nascent maker space grew into a 500 square foot garage and attracted more likeminded individuals. In one year he had gone from an idea, to occupying 3,000 square feet in SODO. Renn and fellow co founder Jon Madamba opened SODO Makerspace in fall 2014. Courses and Services. SODO Makerspace offers educational classes that are open to the public to learn advanced manufacturing skills such as 3D modeling, soldering, Computer Aided Design and more. Patrons can also rent equipment on a pay you go basis, and membership is not required to register for courses or to utilize machinery. For entreprene urs or small businesses, the company provides consulting expertise on how to use the manufacturing equipment. Educational Outreach. Over the past year, Renn has also branched out from SODO and has begun working with area K 12 schools and PTA groups to educ ate kids on advanced manufacturing techniques. In addition, this effort supplements STEM curricula. Headquarters Seattle Address 1914 Occidental Ave S Time in Location Since Number of Employees 15 (mostly contractors) ��2 Partnerships. SODO Makerspace recently received funding from the City of Seattle’s Office of Economic Development to commence a 12 week course for cohort of four students. Other partnership opportunities have come from both the Port of Seattle and the City of Kent. Talks with the Port of Seattle were focused on setting up a hardware incubator in the city; and the City of Kent was interested in working with SO DO Makerspace to start a maker space in Kent. TOP ISSUES FOR SMALL BUSINESSES For the entrepreneurs who set up shop in SODO Makerspace, a few hurdles stand in their way of expanding their business. In order of priority, Renn listed these top three issues t hat small businesses face. Funding. Whether they’re still holding their full time job and have elected to pursue a business idea on the side, or they’ve devoted themselves fully to a new venture, both types of entrepreneurs need seed money to get started. Ideas may be free, but the execution is often expensive. Small micro loans (as low as $500) can make a difference for an entrepreneur trying to get a business off the ground. Mentoring. Often times entrepreneurs come to SODO Makerspace full of ideas, but might be less aware on how to actually run a business. Because SODO Makerspace supports start ups from concept to creation, entrepreneurs take advantage of staff expertise to learn about crowdfunding, marketing and distribution. Consistency, following a schedule and setting easily attainable goals are all guidelines that have helped incoming entrepreneurs succeed. Teaming. Advanced manufacturing takes a great deal of sweat equity, so growing a team can directly help start ups grow. Teams foster collaboration and inspire new ideas. Entrepreneurs in SODO Makerspace can find likeminded individuals to assist in developing their project. HOW THE PORT CAN HEL P Space. SODO Makerspace asked for one thing from the Port of Seattle space. The company was interested in a ny available buildings or unoccupied rooms the Port owns, to house manufacturing machinery. Harbor Island was suggested as an area for future expansion. Donating a building or other available space would coincide with the sharing economy central to maker spaces. In addition, Renn stressed, the port would help empower the local community to solve its own problems through manufacturing. “Find us a space, and we can fill it up with our likeminded folks. We can continue to expand on what we’ve started.” – Eric Renn, Co founder, SODO Makerspace LOOKING AHEAD Workforce Development. A major long term goal for SODO Makerspace is workforce development. Cultivating a manufacturing workforce begins with educating K 12 students on advanced manufacturing techniques. These students then apply their new skills to start and grow businesses, a nd in turn generate jobs. Investing in Manufacturing. According to Renn, manufacturing offers one of the best returns on investment over a short time period because manufacturing businesses are often self reliant. Focusing on manufacturing takes places ke China out of the equation because parts are made locally. ��3 SUCCESS STORY RAINWORKS’ INVISIBLE SPRAY The SODO Makerspace saw one of its first incubator successes in 2015 with the small business Rainworks. Creator of Rainworks and Seattle resident, Peregrine Church, came to SODO Makerspace ready to launch his product. Rainworks had developed a super hydrop hobic spay that repels water, and can be used like temporary invisible ink to write messages on sidewalks the liquid goes on invisibly and then appears once concrete gets wet. Once at SODO Makerspace, Rainworks worked with Renn to make the spray consumer ready. Together they created a spray bottle to contain the liquid, along with a stencil set, and packaged the two items for retail. Renn and Church initiated a two day crowdfunding campaign via Kickstarter and raised more than $5,000 through 700 orders. Th at investment was used to broaden product distribution and allowed SODO Makerspace to buy capping and labeling machinery. Since December, Rainworks and its invisible spray has been featured on NPR and aims to sell the product for general online purchase. This is a great example of going from an idea to production. Eric Renn, Co founder, SODO Makerspace ��1 Tabor Small Business Development Strategic Assessment BUSINESS PROFILE Tabor 100 is an association that helps minority entrepreneurs through education and advocacy. embers of Tabor 100 are small business owners or self employed individuals who predominantly work i n the construction and trade sectors Tabor 100 was founded in 1998 and named after its founder, David Tyner III, who was dedicated to economic, educational and political advancement of African Americans. Mission: Tabor 100 is an association of entrepreneurs and business advocates who are committed to economic power, educational excellence and social equity for African Americans and the community at large. KEY TAKEAWAYS Tabor 100 would like to see enhanced Port involvement in its events Often the problem isn’t lack of programming to educate entrepreneu rs, the problem is low attendance Tabor 100 is currently working on starting a construction focused Business Development Center BUSINESS MODEL Tabor 100 has a membership of around 150 entrepreneurs and business owners. Dues are $150 per year for each member and fund services such as mentoring and networking events. Some programs are open to the public and free of charge. Tabor 100 is a 501(c)3 nonprofit and covers operations costs through membership dues and fundraising. Courses and Services. Membersh ip in Tabor 100 includes instant access to the organization’s existing network of small contractors and business owners in construction. Often times entrepreneurs in construction are very skilled at their trade, but don’t have the administrative background and understanding of what it takes to run a business. Tabor 100 staff and volunteers mentor its members on business fundamentals such as bookkeeping and marketing. Meet and Greets. In the past, Tabor 100 has also held forums with elected official and meet -and- greets with purchasing personnel, Port official s and other public sector representatives. Members were encouraged to ask questions about the bidding and contracting process to learn more about the public side of construction projects. The eve nts create d a comfortable atmosphere where firms and agencies felt began building business relationships. As a result, many minority firms earned contracts. Attendance. For a multitude of reasons, minority entrepreneurs often don’t take the necessary steps to grow their enterprises. Ollie Garrett , President of Tabor 100, explained the problem isn’t a lack of available training, it’s getting individuals to attend programs. Garrett said minority entrepreneurs might not have time to seek mentorships or educati onal programs because they’re running a fledgling business. Garrett said she’s also noticed minority business Headquarters Bellevue Address 2330 130th Ave NE Time in Location Since Number of Employees ��2 owners can be intimidated by what they don’t know and are too proud to admit they need help. One way to overcome this is to form cohorts that go t ough training courses together. TOP ISSUES FOR SMALL BUSINESSES Barriers that stand in the way of Tabor 100 members who want to expand their businesses: Access to apital Small business owners face challenges to access to capital such as a lack of c ollateral, poor credit or a history of bankruptcy. Contracting pportunities Navigating the public contracting process can be challenging and time consuming Business Know how Business owners running a small construction company are well versed in their trade, but may lack the background and understanding of what it takes to run a business. HOW THE PORT CAN HEL P Construction Incubator. Tabor 100 is currently working to establi sh a Business Devel opment Center that would help contractor s looking to start their own business. Garrett explained Tabor 100 would serve as a “back office” for business owners and help with everything from bookkeeping to providing legal advice to searchin g bid opportunities. Garrett said Tabor 100 is open to Port involvement and establishing a presence at the center. Partnership. Garrett suggested Tabor 100 members could benefit from enhanced Port involvement in Meet and Greets to talk with members about the public bidding process and highlight current bidding opportunities . ese events are also an opportunity for the Port to work with Tabor 100 to meet specific firms of interest. This participation is a n easy step toward forging a partnership with Tabor 1 . LOOKING AHEAD Leadership Tabor 100 membership has nearly tripled since its first few years, from 50 to 150. For Garrett, this solid growth means it’s “time to take Tabor to the next level Establishing the Business Development Center is a move in that direction, but more work needs to be done to inform entrepreneurs of existing resources. ��1 Thinkspace Small Business Development Strategic Assessment BUSINESS PROFILE Thinkspace provides office and co working space for tech startups and small businesses. Included in membership are support services such as recruiting, marketing and administrative functions. Before joining Thinkspace, staff vet entrepreneurs, looking for c ompanies with core values that align to the organization’s mission. Mission: to build a strong community of entrepreneurs, tech startups, small businesses, and nonprofits which share similar core values. We passionately operate as a part of each company’s team; celebrating in their successes, contributing to their sustainable growth, and creating an environment that inspires. KEY TAKEAWAYS Thinkspace is a pot ential partner for a marine incubator Recruitment is prized service for Thinkspace members Tech startups attract entrepreneurs and other small businesses from different sectors The Port could host educational events around transportation and logistics BUSINESS MODEL The majority of Thinkspace members are tech companies – about 75 percent – while the other small businesses are mostly service based, said Founder and CEO Peter Chee. When first establishing Thinkspace, Chee said he focused on attracting tec h startups because they were in line with his background. Since then, Chee explained, the tech members have attracted other startups from different sectors because, “they want to be around growth and innovation.” Space. Thinkspace offers office space, co working stations, meeting rooms and virtual offices. Locations Seattle, Redmond ddress es 936 N 34th St, Ste . 8201 164th Ave NE, Target Industry Tech ��2 Services. Chee said he realized early on entrepreneurs often take on too much while starting up their businesses. Whether that’s building a website, bookkeeping or marketing, th ey often aren’t “playing into their strengths.” Services at Thinkspace are geared toward helping entrepreneurs grow their initial enterprise thereby leaving them time to focus on their mission. Recru itment. Recru iting supp ort evolved organically after Thi nkspace helped several members find and secure talent. It’s now a service offered to all members. TOP ISSUES FOR SMALL BUSINESSES Chee outlined the top three issues facing entrepreneurs trying to grow their businesses: Hiring. For tech startups especially , convincing top talent to join a startup over established tech companies can be a hurdle for new entrepreneurs. Funding. Securing a traditional bank loan can be difficult for a new startup. Sales and Marketing Tech entrepreneurs, Chee said, sometimes u nderestimate the time involved in quality marketing that makes an emotional connection with customers about a particular product. HOW THE PORT CAN HEL P Chee said he was open to entertaining a conversation about partnerships with the Port and said he could envision Port led events In regards to initiating incubators in King County, h e said the Port should pursue ideas that align with the agency’s expertise. Marine Incubator Chee said Thinkspace could potentially help the Port run a marine incubator. He noted the sufficient demand for new technology to improve maritime operations, and said Thinkspace even had members that were focused on technology for deep sea diving and underwater research. Moreover, a marine incubator aligns well with the Port’s ex pertise. Food Incubator Even though a food venture doesn’t represent the Port’s expertise as well as a marine business, Chee said there was enough momentum among Seattle entrepreneurs in the food and beverage industry for the Port’s assistance to be worth while. He said he knew of a few food entrepreneurs in Georgetown who are in need of space. Logistics Education An easy way to support the startup community, Chee said, would be for the Port to host education events around transportation and logistics. Often times entrepreneurs are producing products in quantities so small they can’t be shipped. The Port could help new entrepreneurs navigate shipping logistics, as well as exporting internationally. LOOKING AHEAD Driving Innovation Thinkspace will continue to help entrepreneurs and drive innovation in the local economy, Chee said. “ We make Seattle a better place for all businesses and put eattle on the map as doi ng something totally innovative.” ��1 Washington Interactive Network Small Business Development Strategic Assessment BUSINESS PROFILE Washington Interactive Network (WIN) is a nonprofit organization dedicated to supporting the state’s interactive media industry cluster. Its mission seeks to promote, nurture and grow interactive media to establish the region as a global center for the ind ustry. Reactor is WIN’s accelerator program. Headquarters Redmond (OneRedmond) Address 8383 158th Ave NE Established Number of Employees Target Industry Tech Mission: to promote, nurture, and grow the interactive media industry cluster in Washington tate. By fostering a community around the industry cluster, WIN has helped to create more, high quality jobs in the region. KEY TAKEAWAYS Port could support WIN members by adding online game to SeaTac airport wifi website WIN is actively helping entrepreneurs market their products internationally The interactive media industry cluster includes 330 companies and more than $19 billion in revenue BUSINESS MODEL WIN is a 501(c)3 nonprofit currently housed under the umbrella of OneRedmond. Previously, WIN operated through the Economic Development Council of Seattle King County. WIN does not take equity in companies it helps accelerate. Reactor . When the program was funded through a federal grant, Reactor accepted between 6 and 8 entrepreneurs to enroll in a six month accelerator program free of charge. Reactor now features a two day boot camp for small businesses to learn from industry professionals and mentors. Mentor I ntensive Wo rkshops This portion of Reactor includes a four hour workshop for entrepreneurs who want to learn more about pitching, fundraising, ecommerce, acquisition and getting featured by Apple or Google. WIN Executive Director Kristina Hudson explained mentors and mentees are intentionally paired with a “best fit” in mind. International Exposure. Hudson said some services for interactive media entrepreneurs were designed with an international slant. Because tech companies with products accessi ble through the internet are essentially international on day one, Hudson explained specific workshops helped with global PR and marketing strategies. In 2015, for instance, WIN brought six independent game studios to Gamescom, an international trade fair held in Cologne, Germany. ��2 TOP ISSUES FOR SMALL BUSINESSES For entrepreneurs who have already developed interactive media products, the greatest hurdle is: PR and Marketing Interactive media can be highly competitive, so understanding your product and how to differentiate can make a significant impact. HOW THE PORT CAN HEL P SeaTac Airport Hudson suggested the Port could help publicize local interactive media entrepreneurs by adding their games to login page for SeaTac Airport’s wifi. Travelers would have the chance to play a free, locally made game while waiting for their flight. Space One of the most expensive aspects of the startup process is renting or buying space from which to operate. Hudson said WIN would greatly benefit from Port provided space f or its members. She added, it could accommodate not only interactive media entrepreneurs, but small business owners from other clusters as well. LOOKING AHEAD Video Platform Hudson said WIN is currently seeking funding to develop a video platform to share workshops and mentoring sessions online. She said this approach would reach more entrepreneurs than just the ones who enroll in in person sessions. ��1 William Factory Small Business Incubator Small Business Development Strategic Assessment BUSINESS PROFILE William Factory Small Business Incubator is named for its founder, William Factory, who created the space in 1986 as a way to improve living and working conditions in East Tacoma. Before establishing his own incubator, William Factory co founded the Tacoma Pierce County Small Business Incubator , which received a 1988 “Neighbor’s USA” award. Headquarters Tacoma Address 1423 E. 29th St. Time in Location Since 1986 Number of Employees 2.5 Target Industr ies pecialty Trade C onstruction Business Service s Information Technology Mission: To promote community revitalization through employment growth from the startup and expansion of small commercial enterprises. Tim Strege, the current Executive Director of William Factory SBI , aims to continue the legacy of its founder by “organizing collective action that [leads to] dramatic results.” In 29 years of incubatin g small businesses , over 200 companies have graduated from William Factory SBI . At present, there are more than 40 enterprises learning, networking, and expanding in the Tacoma space, where clients have access to 40 offices and more than 250 workstations. KEY TAKEAWAYS William Factory SBI urged the Port to support the reformation of the Washington State Association of Small Business Incubators New sectors for the incubator include transportation logistics, energy efficiency and technology products subsectors The Port could help minority entrepreneurs enter the technology market in the Puget Sound region BUSINESS MODEL William Factory SBI caters to small disadvantaged businesses in the Specialty Trade Construction, Business Services and Information Technology sectors. Tenants are charged $250 per month for sh ared office space, or between $500 and $2,0 00 per month for private offices. Client businesses have 24/7 access to the Tacoma facility without the urden of a long term, binding lease. In addition to programs and amenities provided to in house embers , William Factory SBI also provides several free small business training sessions throughout the year . ourses and Services. William Factory SBI offers its client businesses 1 2 active training events and workshops per week in areas such as accounting procedures, legal considerations, and how and when to approach hiring processes. Participants benefit from small educational cohort sizes of 10 15 individuals o r businesses. ��2 Incubator organized networking events are another key component to launching businesses. William Factory SBI has relationships with numerous mentors and interns that play an active role in client business development. Firms in the Tacoma faci lity also have access to top tier technological amenities, including a dedicated 100Mb Fiber Optic Link, subscriptions to PlanCenter.com and the Daily Journal of Commerce, virtual server capacity, and access to an on site IT engineer. Physical Space Will iam Factory client companies have access to 40 private offices and more than 250 individual workstations in a $10 million building right off of I Results More than 200 companies have graduated from William Factory SBI. Of these firms, 75% are woman - or minority owned, and historical data show an 80% success rate for all ncubator graduates. At entrance, the majority of clients have one - to two person operations with gross com mercial revenues up to $50,000. Typical companies employ anywhere from 5 to 40 workers, and gross $250,000 $2 million upon graduation . TOP ISSUES FOR SMALL BUSINESSES In addition to the essential internal practices entrepreneurs must implement in order to thrive, there are numerous outside forces that can nurture small businesses and ensure a healthy business climate. Tim Strege listed three compo nents that are crucial to the success of small businesses . Port of Seattle Incubators and Accelerators DISCUSSION DRAFT