LONGMONT, Colo.—After seven years in business, Fidelity Comtech has left its home at the Longmont Entrepreneurial Network.
The maker of wireless networking products recently moved into a 5,000-square-space in the city.
“The quote that we use around here is, ‘Our baby’s growing up,'” said founder and president Joe Carey.
Fidelity Comtech is one example of how LEN is helping start-up businesses grow and add employees, customers and investors.
Client and affiliate members of LEN have added a net 42 new jobs this year, according to Alex Sammoury, LEN’s executive director. That’s a 34 percent increase over the number of jobs LEN companies had last year.
Sammoury said the average job at LEN companies pays $84,000 a year. According to U.S. Census Bureau data, the average wage in Boulder County is about $44,000.
Carey launched Fidelity Comtech, with himself as the lone employee, in November 2001 at what was then called CTEK.
“We (used LEN’s adviser network) initially,” Carey said. “Later on, the real advantage was that you’re close by other entrepreneurs, and you’re all facing similar questions.
“You don’t necessarily need to be in the same building, but it’s nice.”
Fidelity Comtech now has 10 employees, and its revenue continues to grow.
“Business is good right now,” Carey said. “We hit a slow patch in the summer, but we came out of it, and now we are just crazy busy.”
As is activity at LEN.
“Everything is full,” said Sammoury. “Even the Fidelity Comtech space, which they just vacated, will be filled up.”
Clients pay a flat fee of $250 a month for office space at the LEN building and an $800-a-month fee that gives them access to advisers, Sammoury said.
“Compared to what they would have to pay private consultants to get the knowledge, the $800 is a bargain,” he said.
LEN’s clients tend to be technology and biotech companies, Sammoury said. Though they know and understand their industries, they often need advice on how to run a business, and that’s where the advisers come in.
An attorney, for example, might help a start-up company set up equity contracts among the partners or file the necessary paperwork to protect its intellectual property. A financial adviser can show an entrepreneur how to set up an accounting system.
“At any given point in time, it can go from one adviser—an attorney, for example—to up to 10 advisers working with them,” Sammoury said.
All the advisers, many of whom are in Longmont, volunteer their time and expertise.
MicroPhage is another LEN success story. The biotech company, which develops rapid and inexpensive diagnostic tests for bacteria, spun out of the Colorado School of Mines and became a LEN client in late 2004.
The past couple of years, the biotech company has focused on developing products that diagnose MRSA, a staph infection caused by a bacteria that’s resistant to most antibiotics.
MicroPhage recently landed $1.4 million in private investment dollars, bringing the total invested in the company to $11 million, according to chief operations officer Alene Campbell.
Founder Jack Wheeler, who still serves as MicroPhage’s vice president of business development, said he became a LEN client because he knew Sammoury from past companies the two have been involved in, and Wheeler liked the idea of a group of companies located together.
“As the days grow longer and you’re trying to raise more money, you get to sit down and talk with people who are going through the same thing,” Wheeler said.
Wheeler also credited Susan Pratt, whose company used to own the building that houses LEN. The building was sold to Circle Capital as part of the Pratt portfolio sale in early 2005, but Susan Pratt still sits on LEN’s board.
Relationships developed through LEN have helped MicroPhage find staff—the company is up to 19 employees and recently expanded to 10,000 square feet—and investors, Campbell said.
A potential competitor of MicroPhage is Great Basin Scientific, which is also working in molecular diagnostics and focusing on MRSA.
The company’s founders are based in Salt Lake City but, through contacts with Sammoury, located their research and development laboratories at LEN in 2007.
“It would have been very difficult for Robert (Jenison, Great Basin’s chief technology officer), at the time, to set it up without LEN,” said Laurence Rea, a University of Colorado graduate recently hired to run the company’s Colorado operations.
Thirteen of Great Basin’s 15 employees are in Longmont.
LEN continues to attract tiny start-ups that hope to not be tiny for long.
TFStor is a specialized data storage company that was scheduled to move into the LEN building at the beginning of December. The company consists of founder and COO Priyan Guneratne and one other person. Guneratne, who lives in Niwot, said joining LEN appealed to the two because they have software, engineering and operations expertise, but they don’t know sales and marketing, legal matters or finance.
Getting up to speed quickly on such matters will be important, Guneratne said.
“Our time frame is (in) January or February, we will be out there selling a lot,” he said.
Kozio, which develops embedded software products that perform diagnostics for custom circuit boards, is another LEN client who was planning to move in December, quadrupling its space from where it was in the LEN building.
Kozio’s customers include General Dynamics, General Electric, Hewlett-Packard, Intel, Motorola and Raytheon.
President Joseph Skazinski said being a part of LEN has been beneficial beyond the help from advisers. He also benefits from being able to walk down the hall and talk to other entrepreneurs about fundamentals of business.
For example, he said, what’s the proper way to interview a salesperson? What are the right questions to ask?
“I think (networking) is a key to Colorado in general,” Skazinski said. “We need more (organizations like the LEN).”
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