The Maine Legislature is considering a bipartisan bond proposal that could jump-start innovative small businesses and make us more competitive with the rest of the country.
LD 1827, An Act To Authorize a General Fund Bond Issue To Support Maine Small Business and Job Creation, was created by the Maine Legislature’s Joint Select Committee on Maine’s Workforce and Economic Future, after its many listening sessions with businesses, financial professionals and economic development leaders around the state in 2013 and 2014.
This small business and innovation jobs bond would emphasize the development half of research and development and give more Maine entrepreneurs a fair shot to plan, perfect and then launch products in a way that sets them up to succeed and grow. Few, if any proposals still before the state, could do so much to grow Maine businesses and create Maine jobs.
One part of the bond proposal recapitalizes and refocuses highly successful small business loan funds that have already helped Maine. Passing this part alone would create thousands of jobs and unleash millions of dollars in private investment.
Axiom Technologies in Machias took advantage of this funding and has become an important success story for Washington County. It provides a lesson about what happens when we invest in our small businesses.
Axiom’s mission is to bring broadband Internet access to Washington County and the 40,000 homes in rural Maine that still lack broadband. The company continues to explore and develop broadband solutions for businesses without broadband or not enough broadband capacity. Broadband connectivity will allow local companies to operate at the same speed as the rest of the country, making Mainers more competitive.
In 2012, when the building Axiom rented in downtown Machias went onto the auction block, the fledgling company turned to Sunrise County Economic Council and Northern Maine Development Commission.
With the council and commission’s help, the company was able to quickly secure enough financing from sources like the Regional Economic Development Revolving Loan Program to place the winning bid for the property. A conventional bank loan would have taken too long to secure, and Axiom would have lost its headquarters and risked being displaced. This loan process was agile and more flexible, and it allowed Axiom to purchase its headquarters and buy enough time to later secure traditional financing.
Because Axiom received this timely gap financing, the company was able to steadily grow, adding seven new positions in the past year, and it is currently providing technical jobs for 20 Washington County residents. The company expects it will continue to grow.
Businesses like Axiom often need an early infusion of capital to make the leap from a couple of people just trying out an idea to a full-fledged company that hires local workers, puts down roots in the community and benefits other nearby places of business.
That access to capital is often the difference between a great idea and a great reality. Smart, targeted investments in the most promising enterprises would do a great deal of good for the entire state. It would make a particularly big impact in places like Washington County, which has the lowest household income and the highest poverty rate in Maine but is nonetheless full of innovative entrepreneurs trying to get their business off the ground.
The proposed bond includes investments in small business loan funds. It supports small business on the cusp of growth, as well as laboratories and researchers that are innovating in important Maine fields like forestry, farming, aquaculture and sustainable development. The bond also seeks to increase Maine’s biotechnology workforce training from 350 to 500 students per year.
Small businesses are the lifeblood of Maine’s economy, and we ought to be doing everything we can to press that advantage. When we take steps like investing in research and development, we increase the chance that the next big thing will also carry the label “Made in Maine.”
The story of Axiom gaining access to capital at just the right time should be a model for how Maine treats all of its biggest innovators.
Susan Corbett is the CEO of Axiom Technologies in Machias and is a board member at the Maine Development Foundation and the Sunrise County Economic Council in Washington County. Harold Clossey is CEO of the Maine Development Foundation in Augusta and the former executive director of Sunrise County Economic Council.