Westminster tech incubator, BTI team up to aid start-ups on Denver/Boulder Corridor

Business Report Correspondent

WESTMINSTER ? The city of Westminster and Westfield Development Co. are seeking partners to help fund an information technology-based business incubator on the Denver/Boulder Corridor. Called the BTI on the Corridor, the new incubator will team up with the long-established Boulder Technology Incubator (BTI) to grow converging technology companies.

Susan Grafton, economic development manager at the city of Westminster, said the city will contribute $50,000 a year for three years toward the incubator. “We have a lot of young businesses in the area. The city had a consultant do the research to find out if there was an interest (in an incubator), and there was,” Grafton said.

A heavy-hitting triumvirate consisting of Grafton, Jerry Donahue, former president of BTI, and Anne Hayes, with Westfield Development Co., is spearheading the new incubator effort.

Donahue is assisting with fund raising and will help find a businessperson to run the new incubator. Donahue became interim president and chief executive officer of University Technology Corp. (UTC) on Jan. 2. UTC is a non-profit 503(C)3 corporation chartered in 1998 to manage intellectual property for the University of Colorado. It replaced the CU Office of Intellectual Resources and Technology Transfer.

Hayes is vice president of Westfield, builders of Westmoor Technology Park, built specifically for high-tech companies. The park is at 108th Avenue and Wadsworth Boulevard, south of Jefferson County Airport and east of Simms Street in Westminster. Hayes also is project manager for the park, a 2.8 million-square-feet development where BTI on the Corridor will reside.

Grafton is approaching businesses to help fund the new incubator and, while looking for one-year, $50,000 commitments, encourages longer-term commitments of up to three years. When between $250,000 and $300,000 has been raised, Westfield will provide 5,000 square feet of office space to house the facility in Westmoor Technology Park.

“The goal is to generate sufficient income for financial stability for the incubator over its five-year plan,” Hayes said. “We expect the incubator to be self-funding in three to five years.” Grafton and Hayes estimate it will take about $300,000 per year to maintain the incubator. Client companies will be required to contribute equity in their companies as well.

The space Westfield contributes will include high-speed Internet connections, a test lab, a shared server for hosting Web sites, executive suite services and a videoconferencing room. “Incubator clients won’t have to invest in furniture or technical connections,” Hayes said. “We’ll make it easy for them to move in and out.” A maximum of 10 clients is planned.

Grafton said eligible companies would not necessarily have to be from the Denver/Boulder Corridor, but the intent is not to compete with the BTI in Boulder and Longmont. “If a company has a business plan in place and wants to work hard to make their business successful, we would consider them for the incubator no matter where they lived,” Grafton said.

BTI on the Corridor will be modeled after BTI and have its own board of directors. BTI specializes in businesses in software development, e-commerce, health care and telecommunications. It was founded in 1989, was selected as Technology Incubator of the Year by the National Business Incubation Association (NBIA.) in 1998 and has won the Vision 2000 award for best technology business development organization from the U.S. Small Business Administration.

Lenie Roos-Gabridge, vice president of BTI, said BTI’s $500,000 annual operation is funded by government agencies at all levels, economic development councils, professional service providers such as law and accounting firms, but mostly by the corporate sector. In addition, it receives 5 percent equity from its client companies.

“It’s a balancing act between the time we spend to get financing and the time we spend helping our client companies,” she said. The BTI currently supports six companies in the Boulder location, three in Longmont and four affiliates that are not physically in the incubator.

The BTI on the Corridor will implement a similar process as the BTI with clients attending monthly meetings with an advisory board and ad hoc meetings as needed, Roos-Gabridge said. Clients probably will partake in a program of seminars and one-on-one counseling with legal, marketing and technical advisers. On their own, they will work on developing Web pages and other information-technology-based activities and refining their business models. BTI will help them make sense of their business plans and help them get financing.

According to the NBIA, business incubation is a proven model. It catalyzes the process of starting and growing companies and provides entrepreneurs with the expertise, networks and tools. Incubation programs diversify economies, commercialize technologies, create jobs and build wealth. More than 900 business incubators exist in the United States today vs.12 in 1980.

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