Business incubator could aid area's job situation

Downtown Medford may be able to hatch a flock of new technology ventures after a business incubator scheduled for a spring opening gets up and running.

The project, called the Sustainable Valley Business Accelerator, is scheduled to open in April with a modest 1,000 square feet of space from U.S. Bank and free furniture from Lithia Motors.

But when things are humming along, organizers hope to have a 20,000- to 30,000-square-foot facility with satellite locations throughout the region, a network of business mentors, access to venture capital, investors and support staff that will allow local entrepreneurs to get established in a region that could really use some jobs.

A nonprofit task force called the Sustainable Valley Economic Development Initiative, which debuted last summer, says the incubator will give their efforts a tangible presence in the community.

"Our immediate opportunity is to help grow this region's emerging clean-tech or sustainable technology sector by helping to grow new startups," said Mark VonHolle, vice president of S&B James Construction Management Co. and a leader of the sustainable development group.

The group asked Medford City Council for $300,000 this week to help the venture succeed.

The time is ripe to reverse a trend, decades in the making — since the fall of the timber industry — that has led to a region where unemployment ranges above 12 percent and the median wages are in the bottom 3 percent nationally, he said. Jackson County's median wages are 26 percent below the U.S. median and Josephine County is 34 percent below the nation.

Southern Oregon already has a solid technology foundation, VonHolle said, rattling off a variety of e-commerce companies, whose combined presence already circulates more than $1 billion in sales through the Rogue Valley.

"The amount of e-commerce that takes place here is 22 times the national average," he said. "We are not doing this with smoke and mirrors, we already have a strong technology sector."

The Sustainable Valley Business Accelerator will provide clients with six months of free rent and help from at least two staff members.

"It's a humble beginning, but the price is right and we're likely to outgrow it the day we open," VonHolle said.

Sustainable Valley is collaborating with the Southern Oregon Angel Investment Network, which is reviewing proposals for a $125,000 that is available to fund startup efforts in March.

"I've been told there are 30 applicants and we are talking to seven," VonHolle said. "That tells me there is a deep pool of prospective clients."

The incubator's exact role and operation remain a work in progress. It will have an executive director and administrative support, although perhaps not in the first month.

"We're still developing services and programs," VonHolle said. "Those first clients are going to be guinea pigs going through the process. There is a learning curve."

VonHolle said Sustainable Valley wants to model its efforts after the Plug and Play Tech Center in Sunnyvale, Calif.

According to the Plug and Play Tech Center website, the incubator organization has helped launch more than 200 startups, connecting entrepreneurs with investors, university researchers and industry giants such as Sun, Yahoo, Microsoft, Nokia, eBay and Google.

"They have four incubators already firing on all cylinders," VonHolle said. "They've got major support from technology companies, angel investors and venture capitalists. They are aligning with us at the minimum to associate with us and open their space for our clients so they can be exposed to their investors and venture capitalists."

When enterprises are ready to leave the incubator, Southern Oregon should be logical place for them to locate, VonHolle said.

"We're midway between Silicon Valley and Silicon Forest (Portland)," VonHolle said. "New companies know they don't have to go to Asia like they might have in the past. We have a significant advantage over California in that we're more cost-effective. We should be right there knocking on the door."

VonHolle said his task force has the support of the region's congressional delegation, Southern Oregon's legislative delegation and Gov. John Kitzhaber.

He presented Sustainable Valley's short-term plan for long-range results to Medford City Council last week, asking for $150,000 in each of the next two years.

Veteran Medford City Council member Bob Strosser said the proposal needs prompt attention, but cautioned there are plenty of competing elements seeking the same dollars.

"It's something we need to put on the scale and weigh where we want to be economically, not only for the city of Medford, but for the valley as a whole," Strosser said. "It's something we should take a good look at along with many other things at this point."

Grants to social-service agencies and a proposed aquatics center are in the collective mix, along with funding for Public Employee Retirement System obligations, and requests by the police and fire departments, he said.

"We have to weigh the facts about it." Strosser said. "And see how we feel collectively."

Reach reporter Greg Stiles at 541-776-4463 or e-mail

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