Hendricks County officials hope a new business incubator there revs the engines of local entrepreneurs.
The motorsports-themed facility, to be known as Fast-Start, got the green light after a year-long feasibility study concluded the project was a logical fit for a community that already houses Prudhomme Racing, John Force Racing and Bill Simpson’s Impact Racing.
“It would help achieve some of our goals in Brownsburg,” said Jeanette Baker, town council president and treasurer of the Hendricks County Economic Development Partnership, which commissioned the study. “We want to become a racing company headquarters.”
Business incubators are office buildings for emerging businesses that provide support services ranging from educational curriculum to communal photocopiers. Hendricks County officials hope to attract a cluster of gearheads working on everything from electronics to advanced manufacturing.
But first they must decide between two options for the facility: new construction or an existing building. They hope to offer tenants 40,000 square feet of leaseable space.
Baker said the Zanetis building at 802 E. Main St., near Eaglepoint Industrial Parks, is the ideal candidate. The property was on the market for $2.75 million two years ago, according to listing agent Don Treibic, senior vice president of industrial services for Colliers Turley Martin Tucker. One upside to purchasing the building is that a potential tenant has already come forward.
New construction would cost more for less space.
Finding the money for the facility and FastStart operations will fall to its executive director. Baker and her colleagues are working to raise $90,000 to fill that position by Jan. 1.
The new hire will be responsible for overseeing a new not-for-profit organization formed to manage the FastStart building. The executive director also will be responsible for getting moving trucks lined up at the front doors.
“We anticipate the first tenants moving in during the first quarter of 2007,” said Harold Gutzwiller, executive director of the Hendricks County Economic Development Partnership.
Officials hope the incubator eventually qualifies as a certified technology park. If it does, some of the tax revenues generated by tenants would be used to develop the property.
For that to happen, however, the incubator would have to sign a partnership with an institution of higher learning. Gutzwiller said there have been preliminary talks with Indiana State University.
Funding opportunities abound
A plethora of funding options exist for the barons-to-be who use FastStart.
For example, the Economic Development Partnership has a loan program for businesses from Hendricks County with fewer than five employees. It gives preference to minorities and women and has a limit of $10,000.
The best sources of funding, however, don’t require an application, said feasibility study co-author David Miller, a project specialist with Strategic Development Group in Bloomington.
“The greatest source of funding for any new startup is FFA-family, friends and [personal] assets,” he said.
Private funding is also increasing as the economy starts an upswing, Miller said.
He advised would-be tenants to stick their hands in three additional pots:
Small Business Administration loans. Indiana’s SBA office doled out a record number of loans in the fiscal year ended Sept. 30-almost $298 million.
Federal Small Business Innovation Research set-asides. The program requires federal agencies with external research-anddevelopment budgets of more than $100 million to earmark 2.5 percent for small businesses. The Department of Energy, for example, steered $102 million to mom-andpop shops in fiscal 2005.
Indiana Economic Development Corp. The public-private partnership administers the 21st Century Fund, a state program geared toward providing initial funding for high-tech and high-growth companies. The appropriation for the fund is $75 million this biennium.
Is now the time?
Yet, while funding sources seem abundant, some might question the need for another incubator.
Few of the state’s existing facilities are near capacity. A list of the 19 largest published in IBJ Oct. 24 showed that about 63 percent of the 1.3 million square feet of leaseable space is empty.
Available space is only half the story, said Greg Pink, leasing agent for the Sample Street Business Complex in South Bend. The 190,000-square-foot building is 64-percent occupied but is one of the most successful in the state. It has created more than 120 jobs and graduated 10 businesses.
He cited the example of Better World Books, a company that started when some University of Notre Dame students won an award for a business plan. Because the Sample Street Business Complex has plenty of open space, the company has been able to grow without moving to a new building. It started with 3,600 square feet and now occupies 55,000.
What’s more important is that the incubator is in the right location, Pink said.
“A lot of times people develop a ‘Build it and they will come’ mentality,” said Larry Cox, director of the Midwest Entrepreneurial Education Center at Ball State University, “but people don’t start businesses to fill incubators.”
With Miller’s help, Hendricks County officials hope their feasibility plan heads off that criticism. It examines a variety of benchmarks in the area, including the number of patents awarded in Hendricks County, the average education level and the number of businesses started in the past 15 years.
It also takes into account the presence of a motorsports curriculum at various area institutions, including Rose-Hulman Institute of Technology and Purdue University.