Business Incubator Series: Tim Lavengood, Technology Innovation Center – Evanston, Illinois (Part 8)

By guest authors Irina Patterson and Praveen Karoshi

Tim: We had other ways of doing our Japanese program. We could have gone there. There are other ways of doing that, but that is the way they wanted to do it. They really wanted to see the environment here, which was great, but it wound up being costly. As I said, they did it for three years.

Irina: Do you have any other special initiatives at the moment?

Tim: Nothing overseas. We are talking about some things we want to do with the state. We are also working with the city. We are also working with Northwestern University.

So, those are our initiatives [at the moment]. But we are really an entrepreneurial firm, too. I go out and we get some contracts for our services to pay my salary, the sort of contracts we had with Japan, and our contracts with the city, the university, the state.

Then there are private donors who believe in what we do, who give us some money. We do make about $65,000 a year in fees from our tenant companies. It is not enough to cover the costs, but it helps. As I said, we rent our place ourselves. It costs about a quarter of a million dollars a year.

Irina: What do you see as your limitations?

Tim: We don’t have enough space. Space in Evanston is very expensive. We don’t have it built out the way I would like to have it. So, we do have to make a lot of compromises.

For me, the real issues I am confronted with have to do with real estate, because it is our biggest numbers on both sides of our balance sheets. The rent – we manage 30,000 square feet, that is about $27,000 that has to go out every month. That is hard to do when you are dealing with pre-money companies.

I think I can have a very productive program occupy about 200,000 square feet in space, but I can’t. We need to come up with $500,000 a month, and, if the companies were ever late in paying, the cash flow management for that much real estate would be just beyond what we can do.

So, that is really my bottleneck. I can’t get more space. I would like to do it in more locations. I think we can do it all over the state, all over the country and all over the world.

As I said, I have helped to establish incubators overseas. But, again, the big issue is and, what everybody asks for is, Who is going to get the real estate? Well, I can’t go to Tokyo and get real estate, so how far I can go with incubators in Tokyo is almost definitely going to be a function of real estate.

Irina: How about providing virtual services?

Tim: We do have a virtual program. Again, I like to be able to see people, but we are talking about this, as well. One of the reasons we want to build this suite of tools on the cloud is to handle administration, bookkeeping, and all these things that are going to help us.

One of the initial services will be to give a fully blown backend to very early stage entrepreneurs at a reasonable cost. So, that is something we are thinking about.

But there is no substitute for being here. One of the things I would try to preserve as we do [these virtual programs] is to create more of a community, because I can do what I can. But so much of what entrepreneurs learn when they get here comes from being able to talk to other entrepreneurs.

Having this entire network here really makes a difference. So, what I would like to do with the online presence is to make sure that there is a community. We could talk to each other and ask questions and get answers.

That is the kind of virtual presence I am trying to build. It shouldn’t be just be me. I can do what I can do, but the depth of experience when you get our entire network involved is really unprecedented.

This segment is part 8 in the series : Business Incubator Series: Tim Lavengood, Technology Innovation Center - Evanston, Illinois
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