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Positive Change in Northeast Ohio - December 2008 Recap

I think it’s fair to say that no one was particularly upset bidding farewell to 2008.  What a year!

The winds of change are blowing however, and NEOinc continues to see positive entrepreneurial activity throughout the region.   Incoming requests for assistance for all our member incubators remains strong.  Cuyahoga County kicked off a new support program for high potential technology startups.   VC and investment activity is still strong, albeit perhaps a bit more cautious, with most investors telling us to continue bringing them good opportunities.

So while the list of news items below is perhaps not as long as usual, NEOinc and all it’s partner organizations remain very optimistic about the state of Northeast Ohio entrepreneurship.

About this Site

The Northeast Ohio Incubator Collaborative (NEOinc) provides coordinated services to entrepreneurs desiring to start technology-oriented businesses in the 21 counties of NE Ohio.  It was formed by several of the Edison funded incubators and technology centers in NE Ohio; namely The Akron Global Business Accelerator, Braintree Partners in Mansfield, the Great Lakes Incubator for Developing Enterprises [...]

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Thinking Global?

Whether it’s part of your overall strategy, or a response to the current economic climate, many entrepreneurs are investigating a global aspect to their business model.  A new online resource is available that may offer you some guidance.

The Commerce Department’s International Trade Administration, in conjunction with the Kauffman Foundation, has just launched entrepreneurship.gov, intended to be a clearinghouse of information for aspiring global entrepreneurs.  As stated on the site’s About page, the relationship between ITA and the Kauffman Foundation is intended to be a “public-private partnership focused on leveraging best practices in entrepreneurial leadership to advance economic growth around the world.”

The site is relatively new, and as such the resources you’ll find right now are fairly basic.  However, given the backers of this project, we can only expect it will continue to grow in value.  If you are thinking global and are looking for information, you should probably consider bookmarking this site.

Rumplestiltskin sets up shop in Akron

The fairy tale of Rumplestiltskin tells of a dwarf who could spin straw into gold.  While the fairy tale doesn’t end up well for the dwarf, a modern day Rumplestiltskin has set up shop in the Akron Global Business Accelerator and is headed in a much more positive direction.

William Ullom, is Managing Partner of Vadose Research & Development, a new Akron Global Business Accelerator tenant that is commercializing a system to help companies turn their waste into liquid gold.  The beauty of Vadose’s system is that it can accept virtually any scrap material, from complete tires to paint thinners and plastic.  Outputs of the process include natural gas and liquid synthetic crude oil that can be turned into a variety of products like gas, diesel fuel or lubricants.  Even the solid residue waste is useable as it is simple activated charcoal.

For further details on Vadose, the ABGA and other green technology companies in residence there, read Paula Schleis’ full Beacon Journal article.

Tips for meeting the current economic challenge

Greg Hostelley of Inner Circle Advisors was at the MAGNET Innovation Center yesterday speaking about Business 101, the basics of starting up a small business.  Greg did a great job covering some important start up topics including business formation and capital concerns.

Greg left the group with a number of handouts.  His “Tips for Meeting the Challenges of the Economy in 2009” had so many good tips, I asked his permission to publish them here.

Don’t panic.  It’s difficult to make sound decisions if you do.  To get a better sense of where you stand, begin by reviewing your cash position and anticipated cash needs.  Are they in line with your business’s short-term needs goals and risk tolerance?

Take a fresh look at your monthly income and expenses.  Have you been meeting your budgeted projections? How much of a drop in revenue can your business withstand and for how long?  What are your cash-flow needs for the next 90 to 120 days?  Or 120 to 180 days?  Do you have sufficient cash reserves?

Check with your lenders on the status of your credit lines.  Are you in compliance with their terms?  Will your bank renew their commitments at similar amounts, rates and terms?

Eliminate your reliance on credit by disciplining your spending.

Refocus on your balance sheet and how much credit you are extending to customers.

If you credit lines are frozen or at their maximum limits, consider meeting with vendors and working out a schedule of partial payments that would allow continued delivery of critical materials and supplies.

Look into alternative types of financing.  Some to be considered are loans on life insurance policies, loans from key customer that rely on your business for their materials and supplies, or loans from labor unions, local development agencies or the SBA.

Keep an eye on your accounts receivable.  Watch for new patterns of slow payments and follow up immediately.  Review your largest and riskiest accounts to determine whether credit constraint or economic slowdown will affect their ability to pay you.  Keep receivables aging current at all times.

Manage accounts payable more closely.  Forfeiting early pay discounts may be more advantageous in preserving cash that may be needed for critical items.  Keep payables aging current at all times because that’s an important tool for managing cash.

Analyze your expenses and determine which ones can be controlled.  Can you reduce spending in any areas to put less of a burden on your cash flow needs?  As necessary, communicate to staff/team members about the need to tighten spending.  If you are a manufacturer, review inventory management practices.  Are there opportunities to reduce your on-hand inventory?  Service companies should make sure they’re capturing all their billable hours and invoicing promptly.  Have you billed all your contractual items?  How about all your pass-through expenses, such as billable third-party services and travel/living expenses?

Consider ways to pass your increased costs on to your customers.

Check the safety of any cash deposits you have.  On October 3, 2008 the FDIC deposit insurance was temporarily raised from $100,000 to $250,000 per depositor through December 31, 2009.  If you have more than $250,000 in any one bank, move the excess to another FDIC insured bank.  Consider investments such as CDARs (Certificates of Deposit Account Registry) to spread the risk of short- to medium-term cash you may have invested in CDs.

Don’t engage in panic selling of your investments.  Make sure your portfolio is diversified and in accordance with your risk tolerance.

Come up with a plan NOW to respond to future declines in revenues, before they actually occur.  Re-think your business strategies and update projections.  Review your product/service lines to identify the most profitable items and determine how to leverage them for future growth.

Contact your good customers.  Even casual discussions can lead to new business opportunities.

Review all your insurance coverage, particularly any from companies with weak balance sheets.  Be careful not to surrender a policy, as securing new coverage might require underwriting that can affect your coverage.

Calm your employee’s fears about how this crisis will affect the company, their jobs and their retirement or other benefit plans.  Speculation and gossip are counterproductive, so it’s better to address their concerns directly.

For help in understanding some of the issues facing small business, you can turn to the CPA profession’s free Financial Literacy website for consumers.  It offers tools and tips to help you make important decisions for your business and your self.

Help beta test Quality Assurance software

Quite a few people, actually more than you might imagine, respond to our Incubator Updates by emailing back and asking how they might be of help to us.

We’re always thrilled with the offers, and excited about their enthusiasm for YBI, but sometimes we’re hard pressed to point to a project in which they can immediately engage.

Hey, we’ve got one for you now!

We would like YBI portfolio company Accupoint Software (www.accupointsoftware.com) to be introduced to as many small to midsize ISO/TS certified manufacturing firms as possible in the Cleveland to Pittsburgh corridor. The purpose of the visits is to ensure we have all the feature sets the industry would want to see in Accupoint’s process quality assurance software, and to begin looking for firms willing to serve as Beta testing sites for the technology.

OK…you guys keep asking how you can help. Now here’s your chance.

If you know of any such firms and can make the introductions, let me know.

Audere Est Facere

Jim Cossler
Chief Evangelist
Youngstown Business Incubator
330.884.6262
www.ybi.org

United States Special Operations Command SBIR Opportunities

The United States Special Operations Command (USSOCOM) Small Business Innovation Research Office is scouting for small businesses that can provide unique technologies to Special Operations Forces. The current research and development pursuits are described in the FY09.1 Department of Defense Small Business Innovative Research (SBIR) solicitation and can be found at http://www.acq.osd.mil/osbp/sbir/solicitations/index.htm. The five USSOCOM topics included in the solicitation are summarized below for your convenience:

  1. Novel Nanomaterials for Environmental protection of Special Operations Divers: Develop novel environmental protection for Special Operations divers utilizing nanomaterial to provide enhanced diver comfort, effectiveness, and expanded ability to operate in extreme cold environments.
  2. Low Visibility Decoy Flare: Assess and identify innovative technologies, and/or advanced materials that emit an effective infrared (IR) countermeasure in the desired IR spectrum range while minimizing detectable signatures in the visible light spectrum. This topic is restricted under the International Traffic in Arms Regulation (ITAR).
  3. Geo and Ortho Rectified Video With Fused 3d Mapping, Light Detection and ranging (LIDAR), and Live Video Overlays: Develop a net centric, open architecture, operating system independent video system capable of geo/ortho-rectifying Airborne Full Motion Video with Light Detecting and Ranging (LIDAR) and Intelligence overlays using Commercial and Government off the Shelf (COTTS/GOTS) navigational aids and three dimensional mapping applications in near real-time. This topic is restricted under the International Traffic in Arms Regulation (ITAR).
  4. Man Portable Hand Held Survey Device: Develop a single handheld wireless network survey tool to support measurements on WiMax, WCDMA, CDMA2000 1xEV-DO, CDMAOne and GSM networks. This topic is restricted under the International Traffic in Arms Regulation (ITAR).
  5. Compact, Efficient Motor Controllers with Active Noise Cancellation: Develop and test an active noise cancellation system capable of being installed in light-weight compact, low-power, and efficient motor controller systems. The systems must meet safety requirements applicable for use by operators in a closed atmosphere. This topic is restricted under the International Traffic in Arms Regulation (ITAR).

During the pre-release period of the FY09.1 DoD Solicitation (ends 7 December 2008), any technical inquiries must be submitted in writing through SOCOMSBIR@brtrc.com. Questions and answers received during this period will not be disclosed to the general public. During the solicitation open period (8 December 2008 thru 6 AM EST on 14 January 2009), all questions must be submitted through the SBIR Interactive Topic Information System at www.dodsbir.net/SITIS . Questions and answers received during this period will be made available to the general public. Please read the USSOCOM specific solicitation instructions prior to submitting a question.

Additional information on USSOCOM’s SBIR process is located at www.socomsbir.com. Additional information on the overall DoD SBIR process is described at http://www.dodsbir.net/. Information on a particular State’s SBIR program is included at http://www.sbir.gov/state/.

The USSOCOM Small Business Innovation Research Office highly encourages all firms to submit meaningful Phase I proposals that can satisfy the technology needs described in the FY09.1 DoD SBIR Solicitation.

Akron entrepreneurs share cost-cutting ideas

The Beacon Journal recently interviewed several local business owners and executives to share their cost-cutting strategies so that they might inspire others.

Among those sharing their thoughts were three companies from the Akron Global Business AcceleratorSummit Data Communications talked about their first experience with interns, Knotice described how keeping their employees happy helps keep turnover down, and InSeT Systems leverages technology to maximize the time of their three person firm. 

In today’s financial climate we’re all looking for ways to maximize our investments and time, while reducing costs.  Thanks to the Beacon Journal and the business owners who participated for several creative and interesting ideas.

Positive Change in Northeast Ohio - November 2008 Recap

Between the temperature drop and the snow on the ground it’s safe to say our Indian Summer is over and we are making the turn toward winter.  NEOinc wishes you and yours a safe, healthy and joyous holiday season.

The current economic climate is challenging to say the least, and positive news, let alone positive change, has been in scarcer supply than months past.  However, it is said “you find what you look for” and there are still plenty of bright spots to report this month.  In particular, a number of regional entrepreneurs either launched their businesses or received significant funding. 

Read the full article

Third Frontier RFP Announced - $2M available

In case you missed this via NorTech, here’s a reprint of their recent post:

The State of Ohio’s Third Frontier Project recently released a Request For Proposals for the Research Commercialization Grant Program. Up to $2 million in grants will be awarded for projects that improve the commercial viability of technologies developed through federal Small Business Innovation Research (SBIR), Small Business Technology Transfer (STTR) and Advanced Technology Program (ATP) research and development projects. The grants will improve the ability of small technology companies to assess and realize the commercial potential of research projects and to promote the competitiveness of these companies through the augmentation of federal research and development funding.

For more information, please visit the Third Frontier website. The deadline to submit a letter of intent is December 18th. Completed proposals are due January 22nd. Awards announcements for this grant will be announced late April 2009.

About the Third Frontier Project:
The Third Frontier Project was initiated in February 2002. This project is the state’s largest-ever commitment to expanding Ohio’s high-tech research capabilities and promoting innovation and company formation that will create high-paying jobs for generations to come. The 10-year, $1.6 billion initiative is designed to:

  • Build world-class research capacity
  • Support early stage capital formation and the development of new products
  • Finance advanced manufacturing technologies to help existing industries become more productive

Through the Third Frontier Project, additional federal and private sector support can boost the total investment to more than $6 billion. Through the Third Frontier Project and related initiatives, the state offers a comprehensive set of programs that support world-class research, commercialization, training, and information technology infrastructure designed to accelerate company growth and job creation throughout Ohio.

Akron’s latest tenant? Germany!

Akron has a “sister-city” relationship with a town in Germany named Chemnitz.  Recently, that relationship bore business fruit as Advanced Machinery and Technology for Experimental Chemistry (AMTEC), based in Chemnitz, Germany, opened an office in the Akron Global Business Accelerator, becoming its 40th tenant.

AMTEC offers a highly automated parallel reactor system for materials testing for clients that include Procter & Gamble, Shell, BASF and Bayer.  The company also offers a wide range of laboratory equipment for the screening of catalysts, nanotechnology and materials.

With a staff to be hired early next year, a company spokesman said Akron could become the U.S. headquarters for the company’s expanded operations in the future.

For more information, read the entire story as reported by the Beacon Journal.