June 30, 2008

Time to take the incubator out of incubaton

Pulling the trigger on a new idea, launching a new venture, is no small decision.

In the latter years of my prior life, the one in Decatur, I gave serious consideration to leaving the newspaper there and starting a new venture for an idea I had. Did a lot of reading, research, talked to trusted business friends and, frankly, prayed a lot.

I constructed a business plan, crunched numbers, projected costs and revenues. I never pulled the trigger because, I like to think, I never reached a comfort level with what I felt were reasonable projections and the odds of success.

What I didn’t do is have an independent, impartial consultant look at my plan. I didn’t go to the expense of letting experts do a study and give me their opinion. Probably for the same reason.

That certainly cannot be said about the city’s look into a Regional Specialty Food Incubator and Test Kitchen. Last week’s presentations, a walk-through of a summary of a much more extensive business plan for the proposal, displayed a professional, thorough, well-researched look at how the entity can come about, how it can survive, possibly thrive, and how that would benefit the economic development of Bluffton, Wells County and the region.

The team from the Northeast Indiana Innovation Center, an incubator firm itself that has had a significant impact in northeast Indiana in its short history, paints an encouraging picture. The center has generated $49 million in cumulative revenue and has added over $26 million in payroll to the regional economy since 2001.

“The evidence is compelling,” NIIC president Karl LaPan said Wednesday. “If you don’t do it here, I believe someone else will.”

Although I do not recall hearing the comparison Wednesday, the center states in their literature that, after their voluminous man hours of research, study and number crunching, they raise the prospect that Bluffton and Wells County could be to the specialty foods industry what Warsaw is to the orthopedic industry.

Mayor Ted Ellis has put a fair amount of time on this project himself, something he’ll quietly admit to, but was revealed in comments from LaPan last week: “The mayor has been extremely engaged,” he told me. “He’s taken a careful and deliberate look into this.”

Although Ellis says “I’m more than half sure we’re onto something here,” he follows that with a continuing cautionary approach. He likes to refer to former Secretary of Defense Donald Rumsfeld, who famously said, “... as we know, there are known knowns; there are things we know we know. We also know there are known unknowns; that is to say we know there are some things we do not know. But there are also unknown unknowns -- the ones we don’t know we don’t know.”

Although it is admittedly difficult to try to determine what “we don’t know we don’t know,” Ellis is open to any thoughts and questions from anyone about “what we don’t know.”

Barring any major revelations along that line, Ellis plans to get a specific proposal from the NIIC, present it to the city council, and see if a launch is imminent.

Projected costs range as high as $2 million (although no one is pointing to that figure as a likely total). As demonstrated in the business model, much of the funding will come from federal and state grants. Undeniably, the initial seed money will be local funds, most likely to come from County Economic Development Income Tax (CEDIT) coffers and local community donations. It is also likely to expect that further CEDIT funding will be needed as the project moves along.

There are two specific planks of this prospect that encourages this corner to stand upon and endorse a move forward:

1) The first of four “key recommendations” of the business plan proposed by the NIIC: “Use a phased, financially-conservative implementation to create a solid foundation for specialty food incubation.”

“We’re not going to rush out and spend millions to put just anything together” NIIC project manager Steve Franks said during his presentations last week. “We’re going to do it right from a business standpoint.”

2) A Bluffton businessman, it turns out, had Karl LaPan as a professor while working on his MBA at Taylor University. He now serves on that MBA program advisory board with LaPan and has come to know him well. “If Karl believes in this, and if he’s willing to attach the NIIC and his name to it, you won’t find a more capable, harder-working dedicated guy to see that something succeeds,” he told me. “He insists on excellence.”

LaPan, our local friend tells us, was on the “fast track” — working his way quickly up the executive ladder at Jack Welch’s General Electric. “Fort Wayne was lucky to land him.”

“We feel like we’ve done the due diligence,” LaPan told me. “It’s a matter of proper execution.”

Could Bluffton and Wells County be to the specialty foods industry what Warsaw is to the orthopedic industry? A pretty exciting prospect. Let’s — with continued caution and diligence — go for it.

MARK MILLER

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