A charitable foundation that has committed $50 million to spurring entrepreneurship nationwide is launching a $3 million initiative in Maine.
The Blackstone Charitable Foundation is officially unveiling the Blackstone Accelerates Growth initiative at Brunswick Landing on Friday. It will be managed by the Maine Technology Institute and will support and expand existing entrepreneurial initiatives including the Innovation Engineering project at the University of Maine and the Top Gun program at the Maine Center for Entrepreneurial Development.
The goal of the funding is to strengthen existing programs in order to support entrepreneurs and grow the economy, said Stephen A. Schwarzman, chairman, CEO and co-founder of Blackstone, one of the world’s top investment firms. The foundation says the targeted investment can create, over 10 years, more than 10,000 jobs in Maine, adding $664 million in new revenues to the economy.
“Maine is very much a resource-based state. We’re moving into an innovation-type economy,” Schwarzman told the Bangor Daily News. “If we can help push that along in a productive way, then we think we have a role and can be helpful.”
Blackstone has made similar investments in Michigan and North Carolina, but this is the first effort made in a rural state like Maine. Schwarzman noted that it’s sometimes difficult in rural locations to get information from one part of the state to another, and to share best practices, resources and expertise among entrepreneurs.
Maine has long been seen as an entrepreneurial state, with a support structure to help people grow their ideas, starting with early-stage funding to help with patents and mentoring. It has been studied by renowned think-tanks including the Brookings Institution and the Ewing Marion Kauffman Foundation. But the challenge is to always reach all areas of the state — not just Portland, Bangor and other metro regions.
Amy Stursberg, executive director of the foundation, said the support system for entrepreneurs in Maine is excellent.
“All the pieces are there in Maine; there’s so much strong programming and innovation going on there. It’s not like we’re bringing in something that doesn’t exist there,” said Stursberg, “It’s really exciting — there’s just a lot of potential there.”
They do an excellent job, said Schwarzman, “but they can’t be everywhere.”
“Like many things in Maine, they’re quite regionally focused,” he said. “What we want them to do is be statewide focused, take what they know and apply it throughout the state.
“As we look at Maine, trying to completely replace existing things is unwise and unnecessary. What you want to do is put an overlay on top as well as teach more students and, most importantly, bring the expertise the different organizations have statewide so they can affect more people and create more companies and more growth, and ultimately more jobs.”
Maine has gotten larger sums of money in the past to support things such as work force development and other economic efforts. But Blackstone’s investment is surgically targeted to inject funds into successful programs, and can be expanded to increase their impact.
“What we always try to do — in our basic world — is see how effectively we can use our money and our human resources to get the biggest bang for the buck,” said Schwarzman. “This is what the private sector does — not try to throw around large amounts of money for modest outcomes. Our charge is the opposite: spend as little money as you can to get as big an outcome as you can.”
Betsy Biemann, president of the Maine Technology Institute, a private nonprofit created by the Legislature to help fund and support start-ups, said her organization will be the fiscal agent for the project and will house the executive director, who will be recruited through a national search.
The grant is for a three-year period, said Biemann, but she saw potential for drawing more support for Maine’s entrepreneurs.
“If we’re able to implement a high-impact initiative that shows not only growth and success in those three years, but also a vision or next steps, I’m sure any funder — Blackstone or others — will be interested,” she said.
The hope is to have 250 companies participate in programs supported by the initiative in the first three years, she said, with maybe as many as 400 students getting training in entrepreneurship, or doing internships with those companies.
“It’s really going to help cultivate the next generation of Maine entrepreneurs by training college students in entrepreneurship and innovation and supporting internships for them at companies involved in the initiative,” said Biemann. “It will be an opportunity to really excite young people, give them opportunities to work at companies in Maine that are growing.”
Planting entrepreneurial seeds
Jake Ward, UMaine’s assistant vice president for research, economic development, and governmental relations, said the real opportunity is getting more students engaged in innovation by providing scholarship opportunities for them to pursue the innovation engineering minor.
The innovation engineering curriculum consists of classes that teach students how to identify products, accelerate their path to market, find ideas, fail fast but cheap (without throwing good money after bad), and recognize and pursue good ideas quickly and inexpensively.
The idea now is to use money from the Blackstone project to increase paid scholarships, getting more students into entrepreneurial companies, giving them work experience in Maine in cutting-edge areas.
“It’s not just about them starting companies, but them going and working in existing companies, connect them to the opportunities that really exist,” said Renee Kelly, director of economic development initiatives at UMaine.
The UMaine progam is an interdisciplinary minor that has been available for two years. There are 140 students in the program at UMaine this fall, and the curriculum is going systemwide, to other campuses. There are about 70 students taking the courses at other campuses, Kelly said.
The university also teaches innovation engineering through leadership institutes, with 600 people in Maine having gone through them over the past two years. They range from folks from high-tech startups to teams of people from traditional companies looking to reinvigorate their thinking, or “re-starts.”
Mike Duguay, Augusta’s economic development director, went through the institute, and sees the potential of marshaling resources like the innovation engineering studies, interns and the Top Gun program to support Maine’s entrepreneurs.
“The beauty of Maine is we have all the players, all the pieces. They’re at innovation engineering, the Top Gun program — we have these pieces at MTI. What we have to do is formally bring them tighter and link them with the network of entrepreneurs in the community who have been there,” said Duguay. “If we do that, it will be harder for them to fail than it would be for them to be successful.”
Shooting for success
One of those entrepreneurs is Todd O’Brien, a podiatrist practicing in Lincoln who has developed several medical devices over the past few years, and wants to build a viable business around his latest innovation.
Working with UMaine engineers, he’s developed an electronic device that mimics a tuning fork that podiatrists traditionally use to determine the health of tissue in a diabetic’s foot.
He’s in the current class of Top Gun, a program that hooks up Maine entrepreneurs with experienced mentors and provides them with a series of workshops and classes that school the innovators in all aspects of running and growing a start-up.
“What I’m hoping to get out of it is to really refine my business model and my business plan, get input from people who have their own companies,” said O’Brien. “One of the real values of the program I see is the mentoring aspects — I want to get feedback and input and advice.”
But of equal value, said O’Brien, is the mingling and mixing with other entrepreneurs — other men and women who are pursuing a dream, no matter how challenging the environment or odds.
“These are people who are very talented, and very bright, very motivated, enthusiastic and entrepreneurial in a way I see myself,” he said. “It can only be helpful for the state, bringing these people together.”
The program has been around for two years, but has been based in Portland. This is the first year there are two Top Gun classes, one in Portland and one in Bangor. O’Brien is in the Bangor class.
Don Gooding, director of the program, said the support from Blackstone will allow Top Gun to expand further, first to include a midcoast class, then possibly one in the Lewiston-Auburn area.
It also is leading to more co-mingling between the UMaine program and the Top Gun program, he said. Gooding is bringing the innovation engineering curriculum to his program participants, and the Top Gun’s mentoring field is going to expand to include more professional clients who have gone through the leadership institutes.
He sees what Blackstone is doing as a “creation of a statewide innovation system.”
“Maine is so small in terms of its population, yet geographically dispersed. It’s really a challenge to bring the resources to entrepreneurs wherever they are,” said Gooding. “We’re continuing to have these silos, pockets of excellence that have trouble scaling.
“We need this cooperation and consolidation, this creation of a statewide innovation system.”
Connections between entrepreneurs happen organically in places like Boston, said Gooding. In a more rural state like Maine, they need a bit of assistance.
Really, what the effort boils down to is creating an economic development cluster of innovation that isn’t defined by geography, but rather by entrepreneurship and the programs that support it.
In addition to expanding the Top Gun program geographically, Gooding said the support will allow him to attract nationally known speakers for participants, and to turn the curriculum into an online offering, so anyone in Maine with an Internet connection can benefit.
More than just money
Gooding saw a benefit for the state beyond the $3 million, something he called the “Blackstone effect.” Because Blackstone is an internationally recognized name, the work it’s doing in Maine will draw attention to the state and its entrepreneurs, he predicted. That may mean more funders looking at the state, or other groups looking to aid the growing network of entrepreneurs.
Stursberg, from the Blackstone Foundation, said she’s hoping what develops in Maine may be replicable in other rural states. And she also saw ways to help the state besides through funding.
“We’re hoping part of the project is we access Blackstone’s intellectual capital, go up for a day, work on operations management — things we do for portfolio companies,” she said.