Region’s Vibrant Entrepreneurial Environment Boosts Jobs and Investment
Research Triangle Region, N.C. – The Research Triangle Region of North Carolina has long been known as a hub for innovation and entrepreneurship. It is the birthplace of scores of home-grown success stories, many of which grew out of university discoveries.
Cree, Quintiles Transnational and SAS Institute are just a few of the many university spin-outs now contributing significantly to the region’s economy. Further, entrepreneurship has proven to be an important economic growth strategy for both rural and urban parts of the 13-county region.
A new report released by the Council for Entrepreneurial Development (CED) affirms the importance of entrepreneurship to the region’s economy and reveals important new insights into the nature of investments in these ventures that economic developers can use to enhance their support services and strategies.
“New information discovered in this study adds to the nuance of what entrepreneurship looks like in our region,” says CED President Joan Siefert Rose. “Capturing this information opens up enormous opportunities for the region’s economic developers.”
The January CED report, “Starting Something: The State of the Entrepreneurial Economy of North Carolina, 1992-2011,” examined 1,823 high-growth companies founded in North Carolina over a 20-year period.
It found that:
- High-growth companies created 40,560 jobs and attracted more than $7.7 billion in private capital to the state during 1992-2011.
- Jobs created by those companies remained in the state.
- Capital investment was diversified and unusually stable, even during major economic swings.
- Investors came from an increasingly wide geographic range.
- More than 200 corporations acquired N.C. entrepreneurial firms during the period, resulting in additional investment and jobs.
The last two findings were a surprise, Rose says.
“There has been some quiet investment going on that no one was paying attention to. We did not realize how far-reaching our investment pool is. We have investors from as far away as China, Australia and Scandinavia. Also surprising was how many new companies become subsidiaries of larger firms,” she says.
Larger firms often acquire a new company as a research and development hub to gain access to top talent and gain a foothold in the vibrant intellectual community of innovators in the region.
“Having this information can help us more effectively strategize when companies visit the area,” Rose says. “Prospective company executives want to meet local entrepreneurial leaders and innovators who make this area stand out. We need to work closely with the region’s economic developers to make sure this happens.”
Entrepreneurship: An equal opportunity growth engine
Entrepreneurship is as important in rural areas as in urban and suburban areas, says Leslie Scott, director of the N.C. Rural Economic Development Center’s Institute for Rural Entrepreneurship.
“Successful entrepreneurs in rural areas enhance the region’s reputation as a whole and contribute to attracting employers,” Scott says. “Investors in new companies want to be in innovative areas with interesting people and a business-friendly environment, not just in the urban and suburban areas but across the entire spectrum of a region.”
Entrepreneurship is the first line of defense against recession and unemployment, which are often higher in rural areas.
“In most rural counties, the employment base grows by small businesses starting or expanding,” Scott says. “Entrepreneurial success is a matter of survival. This is why programs to educate rural communities about business ownership along with support for new and existing businesses are critical.”
Phyllis Owen, director of Harnett County’s Economic Development Commission, agrees.
“As a rural county, it is very important to support entrepreneurship and provide opportunities for the next generation of business owners,” Owens says. “With appropriate structures in place, entrepreneurs can foster their ideas and become an economic and community asset.”
Among Harnett County’s recent success stories are four under-30 entrepreneurs: Sara Morrison, of Total Body Therapy and Wellness, Jonathan Sanders of Sanders Trucking, Chris West of Elite Gym, and Shawn Rumberger and Darrell Taylor of ECLS Inc., a veteran-owned land surveying company.
Pat Corso, executive director of Moore County’s economic development agency, Partners in Progress, points to a Southern Pines-based company, Hirease Inc. as an example of entrepreneurial impact. Founded in 2002 by husband and wife team Paul and Heidi Dent, Hirease provides employment screening services to companies and has doubled its revenue over the past four years. The Dents have joined the Sandhills Center for Entrepreneurial Leadership advisory board and are leading the formation of a new local entrepreneurial council.
“Community leaders are discovering that a proactive internal approach to growing business is the key to creating new and sustainable jobs,” Corso says.
Granville County uses the same economic impact equation for entrepreneurs as it does for any other businesses when evaluating whether and how to invest in them, says county Economic Development Director Jay Tilley.
“For Drake Dentistry, for instance, we used our county incentive policy to provide the required local government participation for that company to be eligible for a Rural Center Hope Grant,” Tilley says. A $2,800 local grant leveraged $56,000 offered by the Rural Center to help this dental practice open in Oxford. The practice plans to invest $700,000 in its land, building and equipment and create at least seven jobs to start.
“With shrinking opportunities in manufacturing and large companies, more people are looking for ways to provide income to their families in this way,” Tilley says. “In a rural county with small towns like ours, it is important to have policies that, hopefully, encourage but at least do not discourage this activity.”
A little help can go a long way to impact the bottom line for entrepreneurs in rural counties, Scott says. Free and low-cost assistance through training, technical assistance and counseling on business practices and management can significantly mitigate risk.
“When a business is successful, other people realize they can be successful, too,” Scott says. “The environment becomes less skeptical and people see entrepreneurship as an option for improving their lives and their community.”
The Rural Center offers a range of programs that benefit the region. It provided the startup grant for the TriSouth Entrepreneurial Network, a collaborative program created by economic developers in Harnett, Chatham, Lee and Moore counties that provides local entrepreneurs with the Tools for Business Success online program. Its New Generation Ventures makes self-employment an attractive and attainable career option for rural young adults and provides business counseling, scholarships for business training, networking opportunities and access to capital.
Its Rural Hope Grant initiative launched in 2011 supports construction and renovation of health care facilities and purchase of equipment, such as the Granville County dentistry practice. The new Entrepreneurship and Innovation Alliance, first convened by the Rural Center in 2005, is a growing statewide network of business providers and community champions for small businesses, adult and youth entrepreneurship educators and entrepreneurs.
Entrepreneurial support programs abound
The Research Triangle Region boasts an expansive array of programs, networks and investors and an educated workforce that provide fertile ground for entrepreneurial ventures to flourish.
“The supportive environment for entrepreneurship has a great deal to do with the triple helix approach this region uses, in which universities, private sector and public sector work together to ensure innovation and success,” says James Sauls, director of Raleigh economic development for the Greater Raleigh Chamber of Commerce.
Public and privately supported programs guide, launch and support new ventures of all kinds at every stage of their growth. Among them:
- CED, the southeast’s largest entrepreneurial support organization and the oldest entrepreneurial network in the country. Its FastTrac® program helps startups grow into sustainable high-impact companies. Special curricula and mentoring for life sciences and technology companies have led to such successes as iContact, Liquidia Technologies, SciQuest and Tranzyme Pharma.
- N.C. Department of Commerce provides services and financial assistance to help businesses locate, grow and expand in North Carolina.
- Business Link North Carolina is a Department of Commerce-operated one-stop source for information and resources that connect business owners to state-funded assistance that is readily available but sometimes hard to find.
- Small Business and Technology Development Centers located on university campuses provide support for small and mid-sized businesses.
- N.C. Rural Economic Development Center’s Institute for Rural Entrepreneurship encourages the startup and growth of locally owned companies in rural areas.
- N.C. Biotechnology Center supports life science company formation and growth through biotechnology research, education and strategic policy work as well as loans, free access to market research and connections to business, civic and policy leaders.
- NC IDEA provides grants to high-tech startups to support business activities, reduce risk of early failure and advance projects to self-sustainability.
- NC LIVE is a resource system available through the public libraries to assist entrepreneurs and small businesses.
- N.C. Lawyers for Entrepreneurs Assistance Program provides one-on-one representation, community education and self-help materials to help low-wealth business owners build businesses that create jobs, improve communities and break the cycle of poverty.
- N.C. Capital Access Program encourages banks and qualified lenders to consider loans that may fall outside of conventional underwriting standards.
Incubators hatch and nurture new businesses
Incubators and business accelerators across the region provide amenities, such as shared office space and administrative services, as well as expertise and networks that help startups get off the ground.
The Research Triangle Park’s five incubators and accelerators are nurturing more than 80 startups. Alexandria Innovation Center, BD BioVenture Center, First Flight Venture Center, Park Research Center and the Accelerator for Translational Biosciences at The Hamner Institutes for Health Sciences offer administrative and facilities services as well as flexibility in tenant improvements and lease terms.
Granville County is home to the Biofuels Company Accelerator, a program of the Biofuels Center of North Carolina that offers space, intelligence and connections to grow businesses, ideas and relationships that contribute to the development of a biofuels industry across the state.
Durham hosts several niche incubators: Bull City Forward, an incubator for social enterprises; Joystick Labs for video game startups; Launchbox Digital for Internet startups; and The Cookery culinary business incubator. American Underground, Triangle Startup Factory, Bull City Coworking and Evolabs support other types of ventures. Bull City Startup Stampede invites startups from across the country to apply for two months of free downtown office space, a business “boot camp,” free high-speed wireless Internet and a range of other benefits.
“Entrepreneurship is a critical part of the chamber’s overall economic development strategy to grow new companies and promote organic, home-grown economic development,” says Ted Conner, vice president of economic development and community sustainability for the Greater Durham Chamber of Commerce.
“Not only do these entrepreneurs build companies that pay taxes and provide jobs but they spark unparalleled innovation and creativity,” Conner says. “This kind of creativity and fresh thinking is valued by larger companies doing research and other technical work and aides us in our corporate recruiting efforts. We see our entrepreneurial work as talent development and attraction work that is laying the foundation for economic success 20 years from now.”
The region’s major universities host incubators: DUHatch Student Business Incubator at Duke University; N.C. State Technology Incubator at Centennial Campus; and Business Accelerator for Sustainable Enterprise (BASE) at the University of North Carolina at Chapel Hill.
Some counties also operate incubators for startups in their communities. They include: Chatham County’s N.C. Arts Incubator; Harnett County’s Triangle South Enterprise Center; Person County’s Business Development and Entrepreneur Center; Orange County’s Midway Business Center and Cookery West, an incubator for culinary businesses; and Wake County’s Raleigh Business and Technology Center and planned Cary Innovation Center.
Counties and communities offer local support
Many local economic development agencies develop other programs and services tailored for entrepreneurs in their own communities:
- Chatham County’s Economic Development Commission offers a full-time entrepreneur resource specialist to help local entrepreneurs with business planning, financing and networking with potential clients. It is also piloting the state’s first rural “economic gardening” program to encourage entrepreneurship through a comprehensive program of infrastructure and regulatory advocacy for business, a toolbox of proprietary market research data and networking opportunities. It operates a loan fund to help close the collateral gap for local entrepreneurs in need of financing. JD Powersports, a Siler City motorsports business that closed in 2008, recently reopened and added six employees to its staff thanks to Chatham’s entrepreneurial support services.
- Franklin County offers a revolving loan fund to support startups and small businesses. Among its success stories is CaptiveAire Systems, the nation’s leading manufacturer of commercial kitchen ventilation systems. Launched in a one-room facility in Louisburg in 1976, CaptiveAire’s worldwide sales reached $224 million in 2008. Inc. magazine has repeatedly named CaptiveAire one of the 500 fastest-growing private companies in America.
- Entrepreneurs in Franklin, Granville, Person, Vance and Warren counties can apply for financial assistance to a revolving loan fund operated by the regional planning and development agency, Kerr-Tar Regional Council of Governments.
- Harnett County recently co-hosted an inaugural Entrepreneurial and Small Business Summit, planned as an annual event to connect entrepreneurs with resources. Harnett County also operates a business loan program for entrepreneurs and small businesses that helped launch three new ventures in 2011.
- Moore County is forming an entrepreneurial council to boost networking among local entrepreneurs, and a new initiative plans to create incubators and business accelerators in several municipalities.
Universities and community colleges provide knowledge, expertise
The region’s universities, colleges and community colleges have embraced entrepreneurship as a core component. Courses and training in entrepreneurship are offered at nearly every institution and many host incubators and business accelerators that are available to community members as well as students, faculty and staff.
Every community college in North Carolina is part of the Small Business Center Network, which assists startups and small businesses with business-related planning and training.
“In today’s economy, entrepreneurship is a way forward for people to take control of their lives and create wealth in their community,” says Deborah Oronzio, director of entrepreneurship at Wake Technical Community College. “The community college system is a good conduit for that because it offers accessible and affordable education and support.”
Oronzio cites the Wake Tech/Wells Fargo Center for Entrepreneurship as a good example of what community colleges are doing. The center combines education and resources to support entrepreneurial endeavors across the region. Its premier course is “Planning the Entrepreneurial Venture,” developed by the Ewing Marion Kauffman Foundation, a major national force that promotes entrepreneurship.
Lab Rats Studio is a product of both Wake Tech and an area business accelerator. The mobile game development company was founded by Raleigh natives Rion Holland and Alan Rueda, graduates of Wake Tech’s simulation and game development program. It now operates out of Joystick Labs accelerator in Durham. Holland and Rueda were featured speakers at U.S. Sen. Kay Hagan’s recent Back to Work jobs tour.
Chris Angel, another recent Wake Tech graduate, left a career in the software industry to start Sparian’s, an upscale bowling boutique and bistro in Raleigh. The college helped him develop a business plan and find funding to launch.
Sandhills Community College in Moore County offers an entrepreneurial certificate program and provides a $1,000 scholarship for students who start or grow a venture. Its Sandhills Center for Entrepreneurial Leadership hosts an annual entrepreneurial summit.
The region’s large research universities all have programs to support innovation and entrepreneurship and bring ideas and discoveries out of labs and into the world.
N.C. State’s Garage, for instance, is a 2,000-square-foot facility with meeting rooms, lounge space, basic laboratory space, wood working shop and prototyping area designed to foster new ideas and work on entrepreneurial endeavors. Carolina Kick-Start at UNC-Chapel Hill’s NC TraCS Institute focuses on translating medical research and discoveries into new companies.
N.C. Central University’s Community Economic Development Initiative Entrepreneurship Center offers a free program of three six-week, non-credit classes that aid in the development of viable business ventures. The university’s Social Entrepreneurship Collaborative focuses on building capacity of individuals and community organizations to resolve social issues. Students, faculty and community partners drive social change through engaged scholarship, experiential learning and community outreach.
Campbell University partners with Harnett County developers on the NC LIVE pilot project, Outreach to Entrepreneurs in Harnett County, offering small business development and entrepreneurship education services to local entrepreneurs.
A major new initiative, the Blackstone Charitable Foundation Entrepreneurial Initiative, recently funded a collaboration among Duke, N.C. Central, N.C. State University and UNC-Chapel Hill through which 15 master entrepreneurs will identify the best entrepreneurial ideas in the universities and community and work with them to accelerate their path to success. The first group of entrepreneurs is expected to be announced in late February.
Entrepreneurship remains a key regional economic development strategy
Promoting innovation across clusters that leads to new venture creation is a major component of the Research Triangle Region’s economic development plan, The Shape of Things to Come.
The Research Triangle Regional Partnership (RTRP) develops and implements that plan with its many public, private, nonprofit and academic partners across the 13-county Research Triangle Region of North Carolina and beyond. The region is home to the Research Triangle Park (RTP) and the north-central N.C. counties of Chatham, Durham, Franklin, Granville, Harnett, Johnston, Lee, Moore, Orange, Person, Vance, Wake and Warren.
For more information on the region’s economic development strategy and results, visit www.researchtriangle.org or contact Lee Anne Nance, senior vice president of strategic initiatives, at (919) 840-7372 ext. 15 or firstname.lastname@example.org.