7. EDSR 06-12-2006 - Laserfiche WebLink

Home Browse Search

Discuss EDA Business lurnbator Program Analysis f me 12, 200( Pagc 2 uF4 From the inception of the program in 1997 through 2005, the EDA spent approximately $220,000 on the pxogxarn. This accounts fox the initial cost to improve the building and the program operating costs not paid by rent revenue. The results of the program axe indicated in the following table: Year of Entry Company Time in Incubator Status 1997 SolaxAttic 5 years Operating in founder's exsonal residence 1998 -PxotectoxCaxe 1 year fox each All companies no longer in -Watermark company business Submersibles -MAS Technolo es 2000 -Cymbet -Cymbet, 8 mos. -Cymbet leasing 14,800 SF -Vertical Publishing -Vertical Pub, 2 yrs. in Elk River; 25 employees -Vertical Pub. no longer in business 2002 -Bixby Energy -Bixby, 1 year -Bixby will soon be leasing Systems -K-Netica, 4 yrs. in 95,000 SF of space in -K-Netica May 06 Brooklyn Paxk (curxendy leasing 23,500 SF in Rogers) -K-Netica, relocated to Brookl n Center 2003 -Lap2 Technology 18 mos. Operating in founder's Corp. personal residence In summary, 30% of the program tenants "graduated" into market rate space. Two graduated tenants relocated outside of Elk River. One out of the ten incubator tenants, Cymbet, graduated and continues operations in Elk River. Since the goal of the incubator program was to assist companies that would continue operations and provide jobs in Elk River, the end result of the incubator program and its im*estment equates to approximately $8,800 of City/EDA assistance per job created as compared to $1Q,000 of subsidy assistance per new job by typical economic development standards. Prospect Historx Fox the past three years, the EDA required Incubator consultant Harlan Jacobs to submit semi- annual prospect reports. Included in Mx. Jacobs's reports were approximately twenty prospects, five of which became actual prospects, meaning the prospects met with staff and applications were submitted and reviewed by the Incubator Advisory Committee (IntelliPatch, Intellanet, Manage The Farm, Laptwo, K-Netica and SOLUMEN Corp.) Of those five, two became Incubator tenants (LapTwo and I{-Netica). With a 10% success sate of prospects to secured tenants over the past three years, it appears that most prospects and even applicants were essentially not interested in occupying space in the Incubator building, rather preferred gaining access to the area's venture capital funding. Therefore, it is questionable if there is a sufficient pool of tenant prospects interested in locating in Elk River to