EmergeMemphis is expanding into the fourth floor of its warehouse this spring, providing space for another 15 to 18 upstart companies. The $1.7 million expansion (including a new roof deck) illustrates the incubator’s dedication to promoting entrepreneurial growth in Memphis.

Their giant warehouse of offices on Tennessee Street already buzzes with 26 companies at work. “Time Remaining” clocks tick off the days, hours, and minutes each company has left before graduating into a fully independent company. About 80 people pull into its garage each day, all focused on the same cause: growing their early-stage, high growth companies.

Emerge has incubated dozens of Memphis companies since beginning 11 years ago, taking them from start-ups to success stories within 3 to 5 years. The new space, financed with federal funding from the Economic Development Administration as well as private funding from the Hyde Foundation and the Kemmons Wilson Family Foundation, will allow for even more entrepreneurial opportunities.

“Everyone gets the answers they need and gets problems solved and new opportunities,” says Emerge president Gwin Scott. “All answers are at arm’s length.”

The organization is one of 16 organizations partnered in MemphisED, the multifaceted growth initiative administered by the Chamber. MemphisED includes fostering innovation and entrepreneurship among its five key goals, which also include marketing the city, focusing growth within target industries, expanding and retaining existing firms and making Memphis a “city of choice” for so-called knowledge workers who can elect for their careers to take shape in a number of cities.

Beyond its support of start-ups, Scott says EmergeMemphis is also focusing on its programmatic support, including Seed Hatchery, a new, 90-day intensive program for companies in the pre-incubation stage. For each cohort – the first of which began this spring -- EmergeMemphis partners with Solidus, a Nashville-based equity firm, to advance six innovative technology ideas to start-up stage. In return, the program and its mentors receive 10 percent of the company’s common stock.

Organizers aspire to make the program biannual, and may accept applications for the next cohort in early fall.

“We need to build companies and find entrepreneurs,” says Scott. In doing so, “we’re creating a pipeline for us and a platform for them, so that it doesn’t just end — it has staying power.”

Companies at EmergeMemphis represent various stages in the development process. While some are in the earliest of stages, others – like Memphis Aircraft Parts, run by partners Rob Williams and Wei Chen of Sunshine Enterprises – are well into doing business. Already, the small firm has opened a second office in Shenzhen, China to handle business with companies there.

“I started the company in my dining room, and I outgrew that, but it’s not developed at all yet,” Williams says, laughing. “We’ve been in business for over a year… but December is when we really started getting customers on a regular basis.”

Now Williams is looking to build 10 stable customers and a steady base of U.S. suppliers and solid infrastructure while incorporating a Boeing programming system (the Memphis-based Inventory Locator Service [ILS]) and working with FedEx to improve its supply chain.

In exchange for their participation fee, EmergeMemphis participants receive much more than square footage. Intangible factors like programmatic support and business connections make the incubator a unique asset to upstart companies.

“There is no reason for entrepreneurs to feel that they're on an island by themselves,” says Lori Turner, CEO of Red Rover Marketing and 2010 graduate of the program. “EmergeMemphis offers a support system and collaborative culture,” she says, placing particular emphasis on “those crucial first few years when the failure rate is generally high.”

Turner began at EmergeMemphis in 2008, working by herself with a goal of achieving 300 percent growth in five years. She graduated two-and-a-half years early with five employees and her goal already exceeded. This year, she’s targeting additional growth and planning to hire two additional staff members.

“EmergeMemphis played a critical role in helping me set, monitor and achieve financial targets,” she says. “They also opened doors for us and made introductions with partners, vendors and prospective clients.”

Scott says EmergeMemphis’ physical space is a key component of its success -- not only because it provides copy machines and a meeting place, but also because it adds a sense of accountability.

“The concept of the incubator has been around for 30 or 40 years,” Scott says. “There is an understanding of the value appreciated by bringing everyone together in a structured way.”

“We really want to hold them accountable for everything they’re doing,” he adds. “That’s what it’s all about: implementation and execution of growing their companies.”

On the Web
www.seedhatchery.com
www.emergememphis.org
www.solidus.com
www.redrovercompany.com
www.memphisaircraftparts.com