Business Incubator Series: Fred Hoch And Terry Howerton, TechNexus, Chicago, Illinois (Part 4)

By guest authors Irina Patterson and Candice Arnold

Terry: ITA, the Clean Energy Trust and almost 75 other organizations meet at Tech Nexus every month –roundtables for entrepreneurs, legal discussions and also a huge number of user groups, special interest groups, things like the Amazon Web services group, the Lean Startup group or the Adobe Flex User group.

So, it’s really an opportunity for the company that moves in to figure out how to engage and plug in to the learning and collaboration opportunities that surround them here.

Irina: Are there any other tools that you use to help entrepreneurs?

Terry: Community collaboration is one piece of it. The other piece of it are the different meetings and learning opportunities that are put on each month by more than 75 different organizations.

In addition to those two things, there’s an advisory process. We’ve got a network of several dozen entrepreneurs and successful executives who have signed on to serve as advisors for these growing companies. So, what Fred and I will do very often is match them with the right companies.

A company might move in here and we’ll say, “Well, we’ve got a few dozen different people we might be able to draw on. Let’s go find these four or five who we think specifically can add value to this company and form almost a de facto advisory board for those companies.”

That matchmaking is very carefully chosen. It’s definitely an added value for those companies to have those formal advisory services.

In addition to that, there’re a number of different events that are hosted here that give them an opportunity to prepare and present their business plans.

For example, we do events called the ITA Monday Morning Meeting, which gives a chance for a young company to stand in front of a room full of 100 people, potential investors and entrepreneurs, and pitch their businesses – not necessarily to get funding, but for the purpose of finding people in the community who can add specific value to their business plans, and give the entrepreneurs chances to practice those pitches. There’s a variety of programs like that.

Irina: When you talk about advisory boards, what kind of relationship do they usually have with the companies?

Terry: It varies from company to company. Very often, it’s completely voluntary.

But what we’ve seen happen already over the past few years is on different occasions an advisor will actually become an officer of the company, or investor of the company, or will receive some equity for the advisory services.

There’re a number of different things that might happen as a result of connecting those people up, and we’ve seen all of them happen to date.

Irina: What are your metrics for success?

Terry: That’s a good question. I think that those metrics, the ones that we stated are the common metrics that everybody talks about, so we’re happy to point to those.

But the reality is those are not necessarily the ones that we value the most. I’m particularly proud of the fact that probably 80% of the companies that have grown here are actually still growing, are still successful.

I don’t think that number is necessarily a testament to anything that Fred and I did, specifically, as much as it is to the type of entrepreneurial mindset of the companies that are here.

The entrepreneur who seeks out a collaborative environment, who seeks out advisors in the community, who seeks out a scalable facility solution, as opposed to going and signing the long-term leases and spending a lot of money on a startup to get it launched, that type of entrepreneur is going to be more successful than not.

As a result, I think there is a very high percentage of the companies that have grown here that are still out there growing and still successful.

Irina: Would you talk about some of your success stories?

Terry: I’ll give you a couple. There’s a company called CohesiveFT, which builds a server virtualization software that has the ability to manage that virtualized environment in unique ways.

They’ve got some interesting intellectual property that they’ve been building over the past few years. They were actually some of the first people to move into the incubator.

They’ve been very successful at raising capital and finding good customers out in the marketplace. They have some nice relationships now with big companies like VMware, IBM, and others that they’re going to market with.

This segment is part 4 in the series : Business Incubator Series: Fred Hoch And Terry Howerton, TechNexus, Chicago, Illinois
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