Entrepreneurs seem to be flocking to tech startups more than ever before, and incubators are popping up to encourage their growth. Entrepreneurs pitched their ideas in Santa Maria earlier this month in the country’s first-ever Spanish Startup Weekend. Tech Pitch, the annual business plan contest held in San Luis Obispo, is calling for Central Coast startups to apply for this year’s competition. WorkZones, the co-working facility in downtown Santa Barbara, has been attracting local startups for almost two years. And Synergy Business & Technology Center, near the Funk Zone, is a big draw for entrepreneurial small businesses.
The Goleta Entrepreneurial Magnet (GEM), the latest startup in the area, will hold its Demo Day where all Summer Accelerator startups will make Shark Tank-type presentations to a group of judges that includes representatives from the local business community and venture capitalists. The general public is invited to attend the event from 5 to 8:30 p.m. Sept. 9 at the Bacara Resort & Spa.
UCSB Spawns Nonprofit Incubator
GEM, a nonprofit organization, emanated from UCSB. Recently UCSB placed 20th on a Forbes Magazine list of the nation’s most entrepreneurial universities; UCSB was one of only six institutions of higher learning from California on the magazine’s top 20 list.
In the Aug. 18 edition, Forbes lauds the collaboration of UCSB, the City of Goleta and the Goleta Valley Chamber of Commerce, which led to the opening of the 4,500-square-foot GEM. Their goal for next year is to make the Top 10 list.
Several years ago, leaders at UCSB, the City of Goleta and the Goleta Valley Chamber of Commerce began to notice that UCSB students who competed in UCSB’s New Venture Competition often moved to Los Angeles, San Diego or the Bay Area to start their new business because they had no real support in the Santa Barbara area. So these three groups got together to figure out how they could support these pre-startup companies.
As a result, GEM was formed. After a year, Doug Lynch came on board as the first executive director to help drive the initiative, to find a location, to sign up startups, to get the operation staffed and to find funding.
Doug Lynch Provides Superior Leadership
Lynch’s background is in the oil and gas industry. He has an ocean engineering degree and a master’s degree in business administration. He admits he wasn’t a great engineer because he found that he enjoyed the people side of business more, not typical of most engineers. So he moved into management consulting in the engineering world by co-founding a management consulting company that taught leadership development and continuous improvement to oil and gas companies.
Lynch retired three years ago and became involved in UCSB’s Technology Management Program as a mentor, later becoming one of its entrepreneurs-in-residence.
After he accepted the job as executive director of GEM, he discovered he was good at fundraising. He spearheaded the effort to raise $550,000 to fund GEM for a three-year period. Lynch is proud that they already have these funds collected and deposited in the bank. He points out that GEM is a startup itself and is still refining its business model as it goes.
Lynch and the GEM supporters have a clear vision: GEM is an economic growth engine for the Goleta region. Their goal is to welcome startups into GEM, facilitate their growth until they are larger than GEM can support and then spawn them into the larger community so they continue to grow and stay in Goleta and the surrounding area.
Space Available at GEM
GEM wants to get the word out that it still has available space, and it is going places. Anyone interested in mentoring or advising these young entrepreneurs and startups, or has a special skill to offer to the startups, is encouraged to contact Lynch at GEM. He wants to hear from business people, law firms, accounting offices and any successful entrepreneurs who want to share lessons learned.
GEM opened in July with an open house hosted by the Goleta Valley Chamber of Commerce. Late in the spring, GEM announced its Summer Accelerator program, and 14 startup companies applied — and it accepted only six. One of its venture capital sponsors, Chris Felipe, donated $50,000 to the program that was shared among the six companies. The Summer Accelerator Program, which is basically a business incubator program on steroids, is a two-month program that’s akin to feeding the startups with a fire hose, an approach that includes weekly workshops from successful local entrepreneurs, subject matter experts and a CEO roundtable.
As part of acceptance into the program, each startup had to identify five key goals it wanted to accomplish during the summer. These goals are reviewed weekly at the CEO roundtable, with all the other startup CEOs.
In addition to the accelerator companies, they have two entrepreneurs-in-residence and two more local startups coming in to rent additional space. Members of the Accelerator Program also receive free membership in GEM. In the fall, once the Accelerator Program is finished, GEM will start offering similar workshops to the general public.
Working space inside the 4,500-square-foot GEM facility includes 24-hour access, four offices, 12 cubicles, two conference rooms and four hot desks (where individuals work from their laptop and take them home at the end of the day). GEM membership includes free wireless, use of conference rooms and the break room, access to mentors, advisors and workshops, and all the coffee you can drink. GEM is on track with its own business plan, which calls for it to be one-third full now and full with a waiting list within one year.
Public Invited to ‘Shark Tank’ Presentations
On Sept. 9, GEM will hold its Demo Day, where all the Summer Accelerator startups will make Shark Tank-type presentations to a group of judges that includes representatives from the local business community and venture capitalists. It will be held at Bacara Resort & Spa’s renowned Screening Theater from 5 to 8:30 p.m. The general public is invited and encouraged to attend and be inspired by these young entrepreneurs. Lynch is now busy raising prize money for the best “pitches” and recruiting successful local entrepreneurs and angel investors to act as judges.
The idea of co-working facilities is not new. Santa Barbara has three such sites: GEM, Synergy and WorkZones. All three of these facilities target slightly different markets. WorkZones focuses on sole proprietors and professionals who need conference rooms and want to get out of their home office to work. Synergy is similar to GEM and offers working space, conference rooms and a break room to existing and startup companies. GEM provides working space, conference rooms and a break room as well as workshops, mentors, and advisors for science and technology startups, many of which come out of UCSB.
In observation of National Co-Working Week, Aug. 4-9, GEM partnered with two other local entrepreneurial hot spots — Synergy and WorkZones — to sponsor an ad in The Independent to highlight the week. The public was invited to try out any of these three places free for a day.
GEM Plans for Growth
GEM is already planning for its next iteration, which it calls GEM 2.0. This will include a wet lab in the facility that will comprise a sink, fume hood and a drain to allow life science startups to conduct small experiments and tests.
I asked Lynch what advice he has for would-be entrepreneurs. He pointed out that there are lots of great local programs offering free business advice for startups, including the Small Business Development Center, the Scheinfeld Center at SBCC, SCORE and Women’s Economic Ventures. These are great places to help people who have a business idea that they want to take it to the next level. GEM then becomes the next stage after the company develops a business plan and starts developing and marketing products. GEM can help take the company to the next stage as an actual business.
GEM Is Part of an International Movement
GEM is part of a larger movement and belongs to the National Business Incubation Association. Lynch attended the NBIA national conference in New Orleans in April. There were over 300 business incubators in attendance, and one-third of those were international. While at the conference, Lynch met representatives from Chrysalis, a Chilean business incubator, and now there are plans to conduct a sharing program with Chrysalis’ program and GEM. He has also connected the folks from Chile with the Latino Startup Alliance, based in Silicon Valley, with a branch in Santa Maria.
In an effort to develop more international connections, Lynch also met last week with French embassy representatives who want to start a similar sharing program in France. While at the NBIA conference, Lynch also met attendees from programs in Russia, England, Trinidad, South Africa, the Philippines and Toronto, which has a facility with more than 1.5 million square feet. There is a lot of interest worldwide for startups to learn about different cultures and different ways of doing business. In fact, the NBIA may soon become a true international association.
There is definitely more interest lately in creating startup businesses, often fueled by TV shows like Shark Tank and Silicon Valley. People are attracted to the idea of being an entrepreneur because it gives them the opportunity to take control of their future rather than becoming a cog in the wheel of a large company. As a startup, you are the wheel. But Lynch warns that while working at startups are popular, they are not for the faint-hearted and they are definitely not 9-to-5 jobs.
Biographical Information for Doug Lynch
Doug Lynch has spent more than 25 years in the oil industry and has lived and worked in many of the world’s oil centers. He received his BSME in ocean engineering from the University of Hawaii and his early engineering career was with Vetco Offshore, Ventura Tool Company, one of the early pioneers in the offshore oil and gas industry.
After receiving his MBA, Lynch moved into management consulting for the oil industry. He co-founded his own company, The REACH Group, in 1999. Based in Houston, Texas, and with offices around the world, The REACH Group is a leader in management consulting to the upstream oil and gas industry. His clients included all of the world’s largest oil companies and government organizations.
Now retired (sort of) and no longer living on an airplane, Lynch is the executive director of the Goleta Entrepreneurial Magnet, a business incubator in Goleta and a collaboration of the City of Goleta, the Goleta Valley Chamber of Commerce and UCSB. Lynch is also a mentor and advisor with the entrepreneurship programs at SBCC and UCSB.
— Dr. Cynder Sinclair is a consultant to nonprofits and founder and CEO of Nonprofit Kinect. She has been successfully leading nonprofits for 30 years and holds a doctorate in organizational management. To read her blog, click here. To read her previous articles, click here. She can be contacted at 805.689.2137 or cynder@nonprofitkinect.org. The opinions expressed are her own.