Economic Development Agencies and Indiana Economic Development Corp. and State Government and Government & Economic Development and Economic Development and Life Science & Biotech

IEDC to launch Web site to match startups with suppliers, vendors

June 2, 2008

For Indiana's life sciences companies to flourish, they need to get better at romance.

Helping companies meet, greet, date and deal is the idea behind a new Web portal being built by the Indiana Economic Development Corp. to match startups with in-state vendors, suppliers, investors or people who can help them. It is scheduled to launch in June or July.

It's sort of like eHarmony for business, said Bruce Kidd, director of entrepreneurship at the economic development corporation, referring to the online dating site. eHarmony boasts on its Web site that its "compatibility" software helps singles meet based on more than just photos and terse personal descriptions.

The state's Web portal will be called INBiz-Cafe and will be open to all kinds of companies, investors and people--not just those in the life sciences. Yet Kidd said companies creating innovations often have the toughest time finding the companies that can serve their needs.

"Life sciences companies in particular need these specialized people and products as they create market-changing therapeutics, devices or services," he wrote in an e-mail.

Dave Wortman thinks the portal is a good idea.

"We certainly don't have a network that is as well developed as Silicon Valley and the Boston area, but it is rapidly developing," said Wortman, chairman of Indianapolis-based medical-device startup SonarMed Inc., which is developing a human airway monitoring system. "The portal that IEDC wants to develop could be a great aid to that."

Kidd envisions entrepreneurs submitting forms online--kind of like eHarmony's compatibility profile. Then the portal would search the database for matches to an entrepreneur's form and notify him of them.

Suppliers, vendors, investors and even people looking for jobs could also submit forms detailing what they have to offer. But they could not see which entrepreneurs were querying the database--so they couldn't use the database to generate leads for unsolicited sales calls.

Bloomington-based Canopy Group has developed the site for the Indiana Economic Development Corp. It's now conducting focus groups to make sure the site is easy to use and is soliciting Indiana businesses to post information about themselves in the database.

BizCafe will also allow startups to connect to available government grants.

Right now, unfortunately, there is no easy way for a young company to find a company in Indiana that can provide the specialized service or product it needs. Entrepreneurs rely on their network of contacts and on trade groups to find partners.

"That's just not efficient," Kidd said in an interview. And too often, he said, he hears a company say it hired a company out of state only to learn later that an Indiana company could have done the job.

When the state launches BizCafe, it will also launch a sister Web portal called INDURE. It will run off a database of research projects and intellectual property at Indiana, Purdue, Notre Dame and Ball State universities.

Kidd hopes INDURE helps more university research get turned into commercial products and helps small companies tap into the expertise that resides at Indiana's colleges.

John Diekman, managing partner of 5AM Ventures, a life sciences venture capital firm in California, said he knows of nothing quite like BizCafe. However, he said the state of Utah has a similar phone-based service.

And he said good venture capitalists and trade groups should already be doing the kind of matchmaking Kidd envisions. But a Web portal would be helpful, he said, as one more tool for venture capitalists to use for their network building.

Dr. Alfonso Alanis, the CEO of Indianapolis-based Anaclim LLC, said he has found all the partners his company has needed through Indianapolis' life sciences promoter, BioCrossroads.

"I'm sure if BioCrossroads didn't exist, this would probably be very meaningful to us," Alanis said. Still, he said he liked the fact that he could query the BizCafe database without getting follow-up sales pitches.

"Unsolicited requests, we get a lot of those already," he said. "Everyone wants to sell you something."

Getting entrepreneurs to use such a system will be tricky, said Jim Pearson, the former CEO of Suros Surgical Systems Inc. After selling that company for $248 million, Pearson has started a new medical-device company in Indianapolis called NICO Corp.

"If we just expect people are going to sign up for it, [it's] probably not going to happen," Pearson said. "I think it's a good idea. But I think it's a challenging idea."

The kind of matchmaking Pearson would like to see is a series of conferences aimed at pairing young firms in various stages of development with mentors who can counsel and guide them through that specific stage.

That way, he said, professionals looking to serve entrepreneurs with nothing more than an idea could find them. And companies interested only in startups in their expansion phase could meet those companies.

Pearson suggested that filling out a form on BizCafe could be a requirement to participate in such conferences.

"It's not just the matchmaking game, it's the strategic development of the state's initiative in life sciences," Pearson said.

Indiana is trying to grow its life sciences sector as some of its past jobs staples--such as automotive and steel industries--recede.

Indiana boasts a higher concentration of "bioscience" jobs than all but three other states, according to a 2006 report by Battelle, a life sciences research firm in Columbus, Ohio. Battelle estimated that more than 223,000 jobs in the state were tied to the biosciences. It includes in that category companies involved in pharmaceuticals, medical devices, research, testing and medical laboratories, and agricultural feedstocks and chemicals.

The number of jobs in those industries grew about 2 percent a year from 2001 to 2004, the most recent figures available to Battelle at the time of its report.

Transportation equipment manufacturing in Indiana, which includes all automotive fabrication, directly employed nearly 140,000 workers as of 2004--hardly changed since 2001.

Since then, Indiana's life sciences giants--Eli Lilly and Co. and Roche Diagnostics--have begun spinning off more companies and outsourcing more work they used to do in-house. That means small, not large, companies will increasingly drive Indiana's economy.

Because of that trend, Kidd said, large organizations such as Delphi Corp., the Crane Naval Surface Warfare Center and the state's big universities now have a greater desire to work with small companies.

Eventually, Kidd said, BizCafe could extend well beyond startups, and become a meeting ground for companies of all sizes.

"It doesn't have to be just entrepreneurial companies that utilize this ultimately," he said. "But that's where our focus is in initially because that's where the biggest need is."

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