NYC’s first small business incubator
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TESS VIGELAND: Throw a proverbial stone and chances are you’ll hit someone who’s been “downsized” in this recession. Losing a job can be disastrous, but for some, it can also be an opportunity. According to the Kauffman Foundation, some of the country’s biggest companies have their roots in recessions. Perhaps with that in mind, New York City has founded its first small business incubator.
Ben Calhoun explains how it works.
Ben Calhoun: If you spend time talking to entrepreneurs, you start to notice they share a special skill. When they introduce themselves, they have an ability to move from name to sales pitch so quickly, it’s as if the two were physically attached.
Calhoun: Let me just start by having you introduce yourself on tape.
Joel Henry: Hi, my name is Joel Henry. We started the Fig Food Company and the objective of Fig Food is to make…
Fig Food is a vegetable-based organic food company. Before starting it, Henry worked for almost 19 years in the corporate food world — at places like Kraft, Campbell’s Soup and wine and spirit giant Diageo. The whole time he fantasized about starting his own company.
Henry: I’ve always wanted to figure out what I was going to do that was going to leave a legacy, that’s always the piece that’s been paramount in my mind.
And so when his job was eliminated a while ago, he thought, you know, if there were ever a time.
Henry: Now’s the time, this is it, if I’m going to do it, this is the time.
Now he sits in a grey-walled cube 12th floor of a Manhattan office building just a few subways stops away Wall Street. He shares the floor with more than 20 other companies picked by the city from 300-and-some applicants. All of them are small startups, just like Henry’s.
Henry: I’m the only full-time person in this initiative. I’m the only one, it’s just me.
Calhoun: Staff of one.
Henry: Staff of one.
The others companies in the incubator are all over the map — green energy, social networking, job placement, custom clothing. But they all feel the same white-hot pressure to succeed. Long hours around here are the norm, but the undisputed long-hour champs seem to be a film production company started by three friends — Ori Gratch, Tim Hobbs and Sophia Pande.
Sophia Pande: I get e-mails from them at 1:30 AM sometimes. Sometimes later.
Ori Gratch: For this film in particular, we were trying to coordinate between operations in London and L.A., and since the time difference there is eight hours, it got a little hairy.
This happened to be the morning after the company’s first movie premiere.
Pande: I really thought that I’d have to give Ori a sedative last night, because I thought his head was going to pop off.
Despite the stress, everything went fine. So today, the group is savoring the win with other companies in the incubator.
Pande: We almost had, I would say, close to a full house, so it felt great.
That’s one of the best things about working here, people in the incubator say. There’s a feeling of camaraderie. You get to share in people’s successes and get support when things aren’t going so well.
Gianni Martire: It’s extreme highs and extreme lows, and even when you have something go good, you have something coming out of the corner that you’re not quite prepared for.
Gianni Martire used to work at Merrill Lynch. He and a few of his friends recently launched a Web site called Hotlist, which helps college students coordinate their social calendars.
Calhoun: Best day so far?
Martire: Well, we just launched yesterday. We did a soft launch to New York City.
So best day: yesterday.
Calhoun: Most frustrating day so far?
Martire: I think would be today.
Martire’s problem is that his Web site is getting too popular too quickly, so his computer servers are overloaded.
Martire: You know, when you’re catering to the 18-to-22-year-old demographic, if it doesn’t load in like a second, they’re not using it.
Martire’s spent the day scrambling to find more server space, and money to buy it. Until he does, Polytechnic Institute of NYU, which runs the incubator is stepping in.
Martire: NYU Poly has actually been generous enough to make a donation of service for us, so right now we’re going to be working with their IT people, because they know our budget, and these servers are very, very, very expensive.
Dollar-wise, New York’s city’s not spending a ton on its incubator initiative — $100,000 on this one and $800,000 to put up four more. Still those in charge have big hopes for the incubator. They hope it gives the city a chance to gain some ground on places like Silicon Valley and Boston. And they hope it can give a leg to those who are trying to get a business off the ground during these tough economic times.
As Johnny Martire settles in for a late night trying to fix his server issue, it’s clear he’s hopeful too.
In New York, I’m Ben Calhoun, for Marketplace Money.
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