Business accelerators grow outside Portland

| Print |  Email
Linda Baker
Thursday, February 02, 2012

Oregon has business accelerator fever. In the last two years alone, Portland birthed The Portland Seed Fund, Portland Incubator Experiment, and the TIE Westside Tech Incubator, among others. The business models vary, but the common goal is to provide early stage companies, mostly in tech sectors, with small amounts of funding and access to mentors, workshops and angel investors.

Now rural areas are part of the contagion. VentureBox, a for-profit tech accelerator in Bend, will debut its first class of seven companies on Feb. 15.  An initiative of EDCO, the program also grew out of discussions with the Oregon Entrepreneurs Network, which landed a $75,000 grant to create a series of Accelerator Boot Camps in Central and Eastern Oregon. Founded in 2010, the nonprofit Sustainable Valley Technology Group in Ashland just hired its first permanent executive director and is seeking start up companies that aim to increase efficiencies or decrease consumption.

The sluggish economy helped catalyze VentureBox, says executive director Jim Boeddeker. “It grew out of an organic desire to replace the [area’s] intoxication with real estate,” he says. Aiming to grow a technology cluster in Bend, VentureBox provides participating companies —which pay $1,500 for a 12 week class in addition to putting up 2 percent equity in their companies — with volunteer mentors and project coordinators. Participants develop their business skills and improve efforts to attract investors and secure angel capital.     

I asked Boeddeker why, as he puts it, accelerators are “the hottest topic in the country.” Credit the “dramatic drop” in the cost of starting up companies, he says.  In “the old days,” launching a new company cost about $3-$10 million  and required a lot of hardware. Today  $150,000-$300,000 can realistically fund a web or mobile application company "and it can often happen inside of a four to six month period," Boeddeker says. That range is a good fit for angel investors, who don’t have the resources of a venture capital team to evaluate bigger deals.  “So they are more interested in companies with an accelerator model.”

Funded by the city of Medford, Jackson County and several foundations, Sustainable Valley charges companies $200 a month for access to space, mentorship and angel investors.  “The public sector is looking at how to stimulate business development in communities,” says Dennis Leidall, the organization’s executive director, who came on board two weeks ago.  The real advantage of accelerators is they “force regions to map their assets,” he adds, noting that an incubator’s board members, typically retired or semi-retired from successful companies,  play a critical role in supporting young emerging companies.

The Bend and Ashland entities differ from some (better funded) Portland accelerators such as the Seed Fund, which provides participating companies with $25,000 in addition to mentors and workshops.  Still, Leidall, who came to Ashland from Santa Barbara, where he ran the technology commercialization program at UC Santa Barbara, said he was impressed by Southern Oregon’s efforts to nurture an entrepreneurial ecosystem. “A lot of communities with population ten times this size don’t have these resources,” he says, citing the Southern Oregon Angel Investment Network as another example. “It’s commendable.”

The proliferating number of accelerators raises the question: Can a city or region host too many incubators?  Are we witnessing an Oregon accelerator bubble?  It's worth noting that outside of the tech world, several incubators, including the Portland Fashion Incubator and Souk have folded over the past few years.   “Accelerators are startups themselves" Leidall notes.  "So some will be successful and some won’t.”

In a competitive entrepreneurial environment, the measure of a good accelerator is the financial backing it attracts.  “The best accelerators select good companies and develop them into the best led businesses," says Boeddeker.  "A successful accelerator should have range of investors circling around them waiting for the class to graduate.”

Linda Baker is managing editor of Oregon Business.

 

Comments   

 
L. Naerheim
0 #1 why are they always focused on techL. Naerheim 2012-02-11 09:44:42
there's a lot of great non-tech companies in Oregon as well. And speaking from experience, it's extremely frustrating when everything is geared toward tech. I own an emerging cpg company that is built on the triple bottom line philosophy of people, planet, profit, & it's been amost impossible to find the right "mentors" in these seed funds because lack of interest in the segment. I'm all for supporting new business but stop excluding non-tech from these opportunities as well. If Oregon wants a diverse culture of successful small businesses to grow their economy then they need to start broadening their scope & interests! enough with the tech!
Quote | Report to administrator
 

More Articles

Tackling the CEO-worker pay gap

January-Powerbook 2015
Thursday, December 11, 2014
BY OREGON BUSINESS STAFF

An SEC rule targets the disparity between executive and employee compensation, reigniting a long-standing debate about corporate social responsibility.


Read more...

Dan and Louis Oyster Bar opens up to a changing neighborhood

The Latest
Thursday, December 11, 2014
121114-oystervidBy MEGHAN NOLT

VIDEO: Revamping a Classic — an iconic eatery stays relevant in a changing marketplace.


Read more...

The short list: 4 companies engaged in a battle of the paddles

The Latest
Thursday, December 04, 2014
pingpongthumbBY JACOB PALMER | OB DIGITAL NEWS EDITOR

Nothing says startup culture like a ping pong table in the office, lounge or lobby.


Read more...

Communications error

News
Friday, January 30, 2015
013015-zidellmattfrench-thumbBY LINDA BAKER | OB EDITOR

How did an errant email to the Zidell family end up fronting a story in the Oregonian this morning?


Read more...

Streetfight

News
Sunday, December 07, 2014
BY LINDA BAKER

On Friday, Uber switched on an app — and with one push of the button torpedoed Portland’s famed public process.


Read more...

Free Falling

Contributed Blogs
Thursday, December 18, 2014
121714-oilprice-thumbBY JASON NORRIS | OB CONTRIBUTOR

The implosion of the energy complex: The best thing for low oil prices is low oil prices.


Read more...

Convention Wisdom

February 2015
Monday, January 26, 2015
BY KIM MOORE

After more than a decade of wrangling, construction on a convention center hotel in Portland is slated to start this summer. But debate over project financing continues.


Read more...
Oregon Business magazinetitle-sponsored-links-02
SPONSORED LINKS