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SOEMe17 Summary: Co-working, Entrepreneurship, Capital Investment
- 3. #SOEMe17
- 4. #SOEMe17
- 5. #SOEMe17
- 6. #SOEMe17 Co-working and Collaboration Density – Connectivity Lucy Van Hook, Our Katahdin
- 7. #SOEMe17 5 co- working spaces 2015 2016 17 co- working spaces “There’s considerable evidence that co-working spaces are the key connection points for, and, often on the leading edge of, the growth of a tech community.” --Mulas, Victor, Michael Minges, and Hallie Applebaum. "Boosting Tech Innovation: Ecosystems in Cities: A Framework for Growth and Sustainability of Urban Tech Innovation Ecosystems." There are more than 871 people using co-working spaces around the state and more than 350 companies. Co-working & Collaboration
- 8. #SOEMe17 Incubators, Accelerators & College Entrepreneurship Density – Connectivity – Diversity Renee Kelly, University of Maine Orono
- 9. #SOEMe17 College Entrepreneurship In 2016, more than 560 students across Maine took part in classes on entrepreneurship and innovation There were 41 different courses offered to college students. There were 8 degree tracks or concentrations There are 8, very active, student entrepreneurship clubs.
- 10. #SOEMe17 Incubators & Accelerators More than 75 different companies served in 2016
- 11. #SOEMe17 Keynote Speaker Thomas Chapman – Chapman & Co Omaha, Nebraska
- 13. Chapman and Company, LLC specializes in measuring the activity in entrepreneurial ecosystems, helping those ecosystems build programs to accelerate and sustain economic growth.
- 14. Bona Fides 0 5 10 15 20 25 30 35 40 45 50 0 20000000 40000000 60000000 80000000 100000000 120000000 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Nebraska Risk Capital Investments 2006-2015 Funding Companies
- 15. 1st Principles What do you want for Maine?
- 16. Conventional Wisdom Economic development is about jobs and investment.
- 17. Reality New job growth comes from young companies.
- 18. Reality 2016 - ConAgra leaves Nebraska....
- 19. Nebraska Stuff 25 24 billion dollar enterprises have their HQ in Nebraska… all but one started in Nebraska.
- 20. Building Hard to get to a place, if you do not know where you are going.
- 25. Support Kauffman (and others) scrape national data. It lags.
- 27. Insights Rank City Raw Per Capita Rank City Raw Per Capita 1 San Francisco 580406.9 1246.5 1 San Francisco 580406.9 1246.5 2 Dallas 94822.4 133.5 2 Santa Barbara 11464.5 257.8 3 Atlanta 83347.8 145.9 3 Seattle 75441.9 202.1 4 Washington DC 82319.8 135 4 Minneapolis 52860 150 5 Chicago 76073.1 79.6 5 Atlanta 83347.8 145.9 6 Seattle 75441.9 202.1 6 Washington DC 82319.8 135 7 Houston 60009.6 90.1 7 Dallas 94822.4 133.5 8 Minneapolis 52860 150 8 Madison 8305.7 129.5 9 Miami 44107.1 73.4 9 Cincinnati 24812.1 115 10 Philadelphia 37950.2 62.5 10 Hunstville 4985 112.1 11 Phoenix 33934.1 74.2 11 Indianapolis 19822.5 99.7 12 Cincinnati 24812.1 115 12 Des Moines 6009 96.5 13 Portland, OR 22712.4 95.1 13 Portland, OR 22712.4 95.1 14 Charlotte 20103.5 82.9 14 Houston 60009.6 90.1 15 Indianapolis 19822.5 99.7 15 Lincoln 2681.2 82.9 16 Baltimore 18693 66.8 16 Charlotte 20103.5 82.9 17 Orlando 18074 75.7 17 Kansas City 16800.6 80.5 18 Tampa 17381.7 58.4 18 Chicago 76073.1 79.6 19 St. Louis 17266.8 61.4 19 Orlando 18074 75.7 20 Kansas City 16800.6 80.5 20 Phoenix 33934.1 74.2 21 Santa Barbara 11464.5 257.8 21 Miami 44107.1 73.4 22 Madison 8305.7 129.5 22 Baltimore 18693 66.8 23 Raleigh 7761.2 60.9 23 Philadelphia 37950.2 62.5 24 Hartford 7520.1 62.1 24 Hartford 7520.1 62.1 25 San Antonio 7234.4 30.3 25 St. Louis 17266.8 61.4 26 Des Moines 6009 96.5 26 Omaha 5609.1 61.3 27 Omaha 5609.1 61.3 27 Raleigh 7761.2 60.9 28 Albuquerque 5142.8 56.7 28 Cedar Rapids 1564.2 58.8 29 Hunstville 4985 112.1 29 Tampa 17381.7 58.4 30 Charleston 3961.6 53.2 30 Albuquerque 5142.8 56.7 31 Richmond (VA) 3633.4 28.6 31 Reno 2437 54 32 New Orleans 3419.5 27.1 32 Charleston 3961.6 53.2 33 Honolulu 2971.7 29.8 33 Chattanooga 2715.8 49.6 34 Memphis 2896 21.5 34Portland (ME) 2608.3 49.6 35 Chattanooga 2715.8 49.6 35 Peoria 1308.1 34.6 36 Lincoln 2681.2 82.9 36 Athens 658.7 32.4 37Portland (ME) 2608.3 49.6 37 Fargo 757.3 32.4 38 Reno 2437 54 38 Tallahassee 1214 32.1 39 Little Rock 1898.3 25.9 39 San Antonio 7234.4 30.3 40 Cedar Rapids 1564.2 58.8 40 Honolulu 2971.7 29.8 41 Peoria 1308.1 34.6 41 Richmond (VA) 3633.4 28.6 42 Tallahassee 1214 32.1 42 New Orleans 3419.5 27.1 43 Fargo 757.3 32.4 43 Little Rock 1898.3 25.9 44 Athens 658.7 32.4 44 Memphis 2896 21.5 45 Springfield (MA) 527.4 8.3 45 Springfield (MA) 527.4 8.3
- 28. Insights All Capital $100k-$1mm Prototype Capital – Under $100k Series A
- 29. Recommendations 1. Trust each other. Be humble and win together. 2. Focus on founders first. What does she need? 3. Ecosystems succeed cyclically…don’t be discouraged by a slowing down. 4. Set audacious goals. 5. Start more great companies.
- 31. #SOEMe17 2016 Pitch Competitions & Exits Density – Connectivity – Diversity James Morin, UMaine Business Challenge
- 33. #SOEMe17 Exits In 2016, there was more than $300 million in major company exits in Maine
- 34. #SOEMe17 "Hoffman’s actions serve as an example of the positive impacts an acquisition can have on the community. When a local business is built and sold, it serves as a liquidity event for startup founders and investors who realize a return on their financial investments and sweat equity. In cases where founders and early employees still retain significant amount of shares in the company, an exit (like Putney’s) potentially creates a number of newly wealthy individuals who may be interested in using that capital to launch their own companies or invest in promising local startups." Whit Richardson, Maine Startups Insider
- 35. #SOEMe17 2016 Capital Investment Trends Density – Connectivity – Diversity Tom Rainey, Maine Center for Entrepreneurial Development
- 36. #SOEMe17 Early-Stage Funding Total Deals Total Invested Exits Slow Money Maine 26 $4,283,000 Maine Angels 26 $3,430,624 (Approx. 50% Maine companies) Bangor Angels 4 $364,948 Maine Venture Fund 10 $1,175,424 3 o 6 Seed Investments - $613,624 o 4 Growth Investments - $561,800 Other Funding Sources (Loans/Grants/ Later Stage) Coastal Enterprises, Inc. Maine Community Foundation Finance Authority of Maine Maine Technology Institute Small Business Innovation Research Program (SBIR) Investment Capital Trends 2016 – Almost $10 million in early stage capital was invested.
- 37. #SOEMe17 Why We Host: Maine Technology Institute Brian Whitney, President
- 38. #SOEMe17 Thank You See you next year for #SOEMe18
Editor's Notes
- What a beautiful space we're in tonight here at CloudPort. How about a big round of applause for them and their willingness to cohost this event. y name is Jess Knox and I'm with Maine Accelerates Growth or as we call it MxG. Before we go too far, Two things (1) we'd encourage you to use the hashtage that you see on the slide below to post pictures or comments on social media; (2) Everyone who checks in on Facebook at this event - checks in at Cloudport will be eligible for a drawing for a membership/event gift certificate drawing at the end of the night. Welcome to the first, State of the Ecosystem event we’ve ever had in Maine. The SOE is part celebration, part look back at the year past and part commitment to the future. Kind of the like the State of the Union, but way more fun.
- I also need to say a huge thank you to the Maine Technology Institute. MxG would not be hear without your support. And more importantly, there are literally hundreds of entrepreneurs and companies in Maine, including some of those we will mention tonight, who have been able to grow only because of your support and investment in them. So thank you. You’ll hear more later from MTI.
- What is MxG. It is open and collaborative network of organizations working to support growth in the entrepreneurial ecosystem, and growth in Maine’s startup and innovation community. There are more than 20 partner organizations that help run the effort - from all over the state. Many of those partners were critical to gathering data and putting together both the brochure you have seen when you came in and the data you'll see tonight. MxG exists because of their work and commitment to Maine entrepreneurs.
- I want quickly talk to you about the data tonight. First, many of you have gotten this brochure when you came in tonight. So, the Ewing Marion Kauffman Foundation in Kansas City is the worlds largest foundation that supports and researches entrepreneurial ecosystems. While there is evolving scholarship on how best to measure this stuff – some of which you’ll hear from our keynote tonight – they released a set of standards last year on how to measure ecosystems. So we took those standards and we applied it to Maine’s ecosystem. Those are the data in that brochure. In addition, we think that there are other interesting data points that help tell the story about what’s happening in Maine – topics like coworking networks, college programs, incubators, accelerators and more – you’ll here about that tonight. You’ll here four, less than five minute presentations on those data points. For each of those, they connect to one of the categories of data in the brochure: density, fluidity, connectivity or diversity. Then you’ll hear from our keynote speaker. Who’ll I’ll introduce with much more fanfare later.
- HI, I'm Lucy from Our Katahdin. OurKatahdin is a volunteer driven nonprofit organization working to promote community and economic development in the Katahdin region. As many of you know, the State of Maine also has a coworking grant fund and OK was actually a recipient of one of those grants last year, so thank you to the State for that. Okay, the data. So we gathered data on Maine's coworking community because we know coworking is a critical aspect of the connectivity of the ecosystem.
- Up until a few years ago, Maine only had a few coworking spaces. Now we're up to 17 coworking spaces around the state. There are now locations from Biddeford to Bangor, Bridgton to Ellsworth. These are places where doers meet. There's hard research that has recognized their role in ecosystems writing "There’s considerable evidence that co-working spaces are the key connection points for, and, often on the leading edge of, the growth of a tech community.” And the data pans out here in Maine, there are more 870 members of these spaces who represent about 350 companies. They are indeed on the leading edge. Thank you. Now I'd like to invite Renee Kelley from the University of Maine to tell us what's happening in Maine's incubators, accelerators and university innovation
- Thank you. The Foster Center for Innovation at the University of Maine at Orono helps students and community members develop a mindset and skill set for creating, testing, and achieving ideas. The center plays five key roles: offers free business coaching to anyone with a business idea, runs a student business incubator, offers a minor and graduate certificate in Innovation Engineering, manages the Innovate for Maine Fellows Program, a statewide college internship program focused on innovation, and coordinates an annual statewide middle school invention convention. "Our Innovation Engineering program, developed at UMaine, serves as a model, with other universities around the U.S. and Canada licensing the curriculum.” College entrepreneurship, incubators and accelerators are part of the life blood of any innovation and entrepreneurship ecosystem. In many ways, it's where ideas begin, are cultivated and then flourish. College entrepreneurship, incubators and accelerators are part of the life blood of any innovation and entrepreneurship ecosystem. In many ways, it's where ideas begin, are cultivated and then flourish.
- Maine Colleges and Universities are playing a pivotal role. In 2016, almost 550 students across the state of Maine took part in classes about entrepreneurship and innovation. There were more than 41 different courses offered to students, with 8 degree tracks or concentrations available to them. There are even 8, very active, student entrepreneurship clubs. More classes and programs are being added every year and we’re excited to see where that effort goes in the future.
- Maine also has seven incubators across the state. In 2016, Maine had two accelerator programs, the TopGun program, run by the Maine Center for Entrepreneurial Development, and the ScratchPad accelerator, a collaboration between the UpStart Center, the Maine Technology Institute and the University of Maine. Between those organizations, they served more than 75 different companies across the state. The world of entrepreneurship and innovation is risky and unpredictable, and so the work of all of these programs to help so reduced those factors. They also help build the ecosystem here in Maine, sometimes with global impact. For example, the college program and incubator at the College of the Atlantic, called The Hatchery. One such participant is Surya Karki, who raised $3million to build schools in Nepal and has recently been selected as a Schwarzman Scholar while working on other ventures in renewable energy and cooperative tea farming. These programs are jet fuel to students and companies seeking to build high-growth ventures or with high-impact aspirations. Thank you. Now we get to hear from our keynote speaker.
- Thank you to Lucy and to Renee for that. It's now time for our speaker tonight - Tom Chapman, from Chapman and Associates in Omaha, NE. First, a really important point – Tom is an Admiral in the Nebraska Navy. So I guess, we’re very pleased to have the Admiral here with us today. Tom has a law degree and an MBA. Despite that, Tom is a real expert on this stuff b/c he’s got the experience. For measuring ecosystems, he’s helped communities in more than 15 states measure their ecosystems. He’s actually has founded a startup founder. He’s served as an executive in a high-growth company. He’s also an angel investor. He is a frequent collaborator with the Kauffman Foundation on metrics. And he was the key player in building Omaha’s startup ecosystem. He told me in the first year of events, his total budget was 600 bucks and to save money that he served milk and cookies instead of beer. It’s this diversity of background that makes him the national authority on this works. He understands all aspects of the work of building ecosystem. Finally, and then I’ll let Tom talk. He cares about what this work does. I’ve been in numerous meetings with him where he reminds everyone that the work of ecosystem building isn’t about data or programs or initiatives – it’s about companies, it’s about wealth creation, it’s about opportunity and it’s about the communities we live in. Ladies and gentleman, it’s my pleasure to welcome my friend, and our keynote speaker, Tom Chapman.
- Next I'd like to have James Morin from the UMaine Business Challenge to ell us pitch events and exits; Thank you. The UMaine business challenge is a business challege that I helped found in XX and is open to all college students around the state of Maine. Some may wonder why we put data about pitch events and exits together in the same grouping. Well, in our ecosystem we talk a lot about the virtuous cycle of entrepreneurship. And in many ways pitch events represent the beginning of that cycle and exits represent the end of the that cycle -- the end until it starts again. So we know that pitch events are a critical component to our ecosystem. They build community, increase visibility for entrepreneurs and innovators, incentivize risk-taking and lower barriers for entry into entrepreneurship. They also serve to strengthen dealmaker networks between companies and investors and mentors. And while exits play a different role in the ecosystem, they're also important. First, they are indicators that the companies that are being built are valuable outside of Maine. This is good for the brand and awareness for the community. The capital event also helps to incentivize other companies or founders for risk-taking. Moreover, most exits end up generating community wealth and knowledge that is reinvested into the community for new ventures and new initiatives.
- Last year, Maine had 9 number of pitch competitions and 6 major exits. competitions like GreenLight Maine has been critical to creating connections for companies. After the first year of Greenlight Maine, company participants leveraged their appearance to get more than $1.6 mill investment - some investor discussions began when investors were able to see the companies and hear their pitch in the competition. In all of the competitions, there was more than more than $180,000 in prize money distributed.
- For company exits it was a big year for Maine. We had more than $300 million in company acquisitions from companies like Kepware, Putney Vet and Delorme. But also for the first time we had other companies grow so that the Maine Venture Fund could realize an exit, actually two, and have the opportunity to put that capital back to work with other investments. This is part of the cycle of high-growth companies – when there is an exit talent and capital usually become available to be re-invested in the ecosystem.
- That cycle was made clear in reporting by Whit Richardson in Maine Startups Insider last week talking about the relationship between Putney Vet founder Jean Hoffman and her recent investment in new startup MedRythms. "Hoffman’s actions serve as an example of the positive impacts an acquisition can have on the community. When a local business is built and sold, it serves as a liquidity event for startup founders and investors who realize a return on their financial investments and sweat equity. In cases where founders and early employees still retain significant amount of shares in the company, an exit (like Putney’s) potentially creates a number of newly wealthy individuals who may be interested in using that capital to launch their own companies or invest in promising local startups.” So thank you. Now, I'd like to ask Tom Rainey from the Maine Center for Entrepreneurial Development to tell us about the capital trends in Maine for 2016
- Thank you James. The Maine Center for Entepreneurial Development (known as MCED) is Maine's statewide virtual accelerator program. Our signiture program "TopGun" has served 144 companies since 2006, and based on a recent survey, 121 of these companies are still in business and many are growing. The good news is that early stage funding is happening in Maine, and not just in Portland. There's a ton of different data sets when it comes to different types of investment capital, data which is much longer than this presentation.
- The good news is that early stage funding is happening in Maine, and not just in Portland. As this slide illustrates, there were 66 transactions by Maine's angel investor groups and others, totaling over $9 million in 2016. The Maine Angels network alone has a membership of 60 qualified investors. As you can see from the slide, the Bangor Angels and Slow Money Maine have also been active. From the dollar amount here, Slow Money Maine's "No Small Potatoes" Investment club has been really living up to their name! Maine Venture Fund continues to do an outstanding job with the resources they have available as they serve a current portfolio of twenty-five companies. Since their start in twenty years ago, they've invested over $16 million in sixty Maine companies and as you can see here, they had a very good 2016 with ten deals completed and three successful exits. Beyond the early stage funding, our entrepreneurial ecosystem is fortunate to have a number of other very powerful organizations involved in funding small businesses. These organizations, MTI, FAME, Maine Community Foundation and CEI provide access to much needed business loans, grants and other support. FAME, as an example, provided $36 million in loan insurance to banks for loans to 237 Maine businesses, leveraging $67 million in financing. And now I'd like to have Brian Whitney, President of the Maine Technology Institute to come up and say a few words about why they host the MxG network.
- Thank you Tom. As many of you know MTI is private non-profit. It's the state funded venture capital arm investing millions of dollars each year into Maine companies in seven different industries. We're proud to host the MxG network. We've been involved with this project since the first interation of the project funded by the Blackstone Charitable Foundation and continue to be committed to the work of the network and it's partners. It's not our opinion that robust communities and ecosystems help support the growth and success of high-impact innovative companies -- it's fact. There are pages and pages of research about it and we're confident that the work that many of you are doing are supporting that effort. So we just wanted to say thank you for your work and we look forward to continuing to work with all of you to expand innovation and entrepreneurship in Maine.
- Thank Brian. Thank you to all of our presenters and our keynote Tom Chapman. Please enjoy the rest of your time hear meeting and networking with other attendeees. Goodnight.