Business Incubator Series: Tim Lavengood, Technology Innovation Center – Evanston, Illinois (Part 6)

By guest authors Irina Patterson and Praveen Karoshi

Irina: Would you give us an example of service providers that come to your incubator?

Tim: We have people who made a living for a couple of years doing programming for various of our companies. You come in, you are doing C++ or something like that, you work with one of our companies and they say, Look this guy picked up what I was trying to do, really fast.

Well [at that point], I can almost guarantee you that somebody else is going to ask you to do some work for them. Literally, I have heard people who have been here for three years, not wanting to work for any particular company. You know, they don’t want to have any set hours, they are just people who like to freelance, and they stayed busy.

If people like you, they talk about it, and you will get a lot of work. Some people have done some financing here, for example, some financing of receivables, things like that, that small companies need.

Just last week, we were saying that it is probably the fourth company someone we know is going to do financing for because there were other people who have come in who charged too much, who were not responsive.

These companies normally have very little power in terms of their review of the service provider like that; they have very little clout.

But one of the nice things is that these guys can go into 35 other companies, and say, this guy did not do [a good] job for me. He is going to be gone, and they know that. So, I think, they are going to get much better service. They could get $50,000 with receivable financing for 90 days, more than most independent entrepreneurs would, because they have the power of this group, and those service providers know it. If you come in here, you may not make a lot of money this time, but you better give him your best work.

I have people come in and talk to me all the time. We can design websites,  we can do some financing, we can do some intellectual property law, we can do this or that. I just say, you know, the key is first to let us come up with some way we can keep you involved here, without necessarily making your ordinary rates for a couple of years.

If you will come in once a month, once a quarter, however you want to do it, you give a couple of talks. Because one of the things I can prove is if someone stays here every two years or so, a company comes out of here and becomes a great client for service providers.

They are going to get to 40, 50, 60, 100 or more employees. They are going to bring in millions of dollars in investment. They are going to have a bank account. Not huge, but it is going to be in the millions of dollars. They are going to need lines of credit. They are going to be doing business overseas.

If you and I can keep this going for two years, you are going to get somebody, you are going to be very happy with this customer and get them on the ground floor. I can pretty much prove that would happen. I don’t know which company it is, nobody does.

But, if you are around here for two years, you are going to land one. If you are doing good work, and people are saying you are good, then you are going to get one, And, as I said, I got dozens of people like that, accountants who have a $20,000-, $30,000-, or $40,000-per-year client they got from here because they stuck out. Some have more than one client.

So, each company benefits from the number of other companies they are with and from the hundreds of companies that have been here in the past. They are part of that entire picture. They are part of all that success, and this helps them.

They are talking to a better lawyer, a lawyer who will take time to learn about their business. They don’t have any money, but that lawyer will sit there with them, talk to them, and write them a contract. Because he knows, if he works with this company and they like what he does, he works with seven or eight companies, and, pretty soon, one of those companies is going to get acquired for $18 million to $20 million, and he is going to get a $100,000 for doing that for them.

I can show it; I can name four or five lawyers that have gotten that in 25 years [in] this place. But, I am saying, when you get there, writing this contract for this company, they say, This is great, you were such a huge help. Plus, you get to know every company here.

This segment is part 6 in the series : Business Incubator Series: Tim Lavengood, Technology Innovation Center - Evanston, Illinois
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