ERC Business Plan and Economic Development Scorecard February 25, 2014
Table of Contents
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ERC’s Over-Arching Goals and It’s Objectives
Page 2
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Executive Summary
Page 3, 4
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Context for the Innovation Scorecard
Page 5, 6
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Understanding Nevada County’s Business Taxonomy
Page 7
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Unique Impact of Nevada County’s Innovation Growth Companies
Page 8, 9
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The Innovative Value Chain
Page 10, 11
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The Nevada County ERC Economic Development Scorecard Process
Page 12, 13, 14, 15
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Economic Development Maturity Model
Page 16
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Nevada County’s Major Strengths
Page 17
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Initiative 1 – Nevada County’s “Fab 5”
Page 18, 19, 20
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Initiative 2 – Nevada County’s “Golden Challenge”
Page 21, 22
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Initiative 3 – Nevada County’s “Royal Welcome”
Page 23, 24, 25
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ERC Activities Calendar
Page 26
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Identified Local Growth Companies
Page 27
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
ERC Vision, Goal and Objectives:
ERC Vision: To implement business development initiatives that result in Nevada County becoming recognized as one of the most economically competitive rural counties in the U.S. by 2019. ERC’s Goal: Through a combination of initiatives and activities designed to encourage existing business growth that position the organization as the hub of business growth in Nevada County, the ERC will work to establish an environment for entrepreneurial start-ups and existing Nevada county businesses, and a new location for businesses with shared alignment with Nevada County’s attributes. The ERC goal is to grow the county’s economic pie. To that end, the ERC will maintain a sustained approach on pursuing these initiatives and activities – with a laser-like focus on businesses that sell products or services on a multiregional, statewide, national or global scope -- and cannot be “all things to all people” in its effort to succeed in achieving its goals and objectives. Consequently, many business inquiries are better suited to the objectives of other local organizations and the ERC will proactively refer such businesses, organizations and individuals to these organizations. 5 Key Objectives: 1. Maintain and grow the private sector membership and sponsor base by at least 20% in each of the next 3 years. 2. Annually contribute to the positive impact the growth of at least one existing Nevada County business with the retention or creation of 10 jobs or more 3. Annually help foster the start-up of at least one new business in Nevada County that has the potential to create 10 jobs or more 4. Annually contribute to the attraction of at least one business to Nevada County that has the potential to bring 10 or more new jobs to the county 5. In 2014 establish or renew key proactive partnership relationships with at least 5 other public, nonprofit or private sector entities that have complementary or referral-based aligned opportunities with the ERC.
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Executive Summary As with most counties across the U.S., discussion among government officials, community leaders, media representatives, tech sector leaders, and businesses in Nevada County about economic development has become an increasingly important topic of conversation. Many reports conclude that a key driver of economic growth and sustained economic competitiveness in today’s global economic environment are innovative businesses that have differentiated products or services that can be sold not just on a local level, but statewide, nationally and even globally. Obtaining a clear understanding on how to most effectively support these businesses versus other types of businesses in the county is essential. The needs of these entrepreneurs, growth-focused established businesses, and technology companies are very different from microenterprises and small businesses that sell product solely into the local market. Consequently, before embarking on job creation initiatives, it’s important for the ERC Board and other local stakeholders to recognize the impediments that exist in Nevada County that affect this distinct segment of the business community, and to also understand the attributes that Nevada County possesses which can be used to demonstrate comparable advantage and help businesses grow. In this context on Thursday, February 6, 2014, the ERC Board of Directors conducted a planning session, using a custom-tailored version of Executive Director Jon Gregory’s Innovation Scorecard process to suit Nevada County’s unique circumstances. In 2011 he led the development of the Innovation Scorecard as an assessment tool for communities, counties and/or regions seeking to advance an innovation and entrepreneurship focused economic development agenda. Nevada County possesses a number of important attributes, including cultural events, quality of its K-12 school system, comparable cost of doing business, access to outdoor activities and cost of living, as well as a prosperity for tech spin offs in a manner unusually high in comparison with other small non-metro counties. However, the Scorecard process identified 5 impediments that are inhibiting the ability of Nevada County to maximize its economic development potential. The 5 Major Impediments affecting Economic Development: 1. 2. 3. 4. 5.
Lack of pervasive high speed Internet Service Under developed skilled, technical workforce Lack of available land Lack of spousal employment opportunities Under developed entrepreneurship programs
Nevada County can generate many positive outcomes by proactively addressing the impediments, and establishing a number of key initiatives that capitalize on the competitive differentiators it does possess. As a result it can become: 1.
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Known as a hub for entrepreneurship and dynamic small business growth compared to other non-metro counties in the U.S. and California
ERC Business Plan and Economic Development Scorecard, February 25, 2014
2. 3.
Recognized in the Bay Area and other key metros as a compelling location to move or start certain kinds of businesses in alignment with all of Nevada County’s attributes. Known for its “Can Do” approach within the community’s stakeholders that can come together with an uncommon sense of urgency to support start up growth of businesses in alignment with Nevada County’s attributes.
The goal of the ERC’s Scorecard process was to present a real-world assessment of the county’s economic development potential and its readiness/capacity to support successful business start-up, business expansion and business attraction. By identifying, highlighting,, and addressing its 5 Major Impediments which ultimately can be turned into opportunities, Nevada County is in a much stronger position to enhance its economic competitiveness in the regional, national and global marketplace. The Scorecard provides a roadmap, through which the ERC’s limited resources (capital, time, energy, networks and expertise) can be more clearly and effectively allocated to service the county’s sustained economic development.
Recommendations/Next Steps A number of specific recommendations are identified first, along with descriptions of three proposed initiatives. In addition, the ERC should leverage the other positive efforts and programs of partner organizations at both the local and regional level, and at Sierra College and regional universities.
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Context for the Innovation Scorecard Innovation remains the one true economic advantage America possesses over other nations. Many important studies conclude that innovation is largely driven by entrepreneurial growth companies. Most of whom start off as traditional small businesses but successfully identify and execute on an unique market opportunity with a differential product or service. Below is a snapshot of data points obtained from the National Commission on Entrepreneurship (NCOE): Emerging growth companies equal only 5-15% of all U.S. businesses, but create 2/3 of all net new jobs in the prior decades; Emerging growth companies have created 50% of innovations, and 95% of radical or revolutionary innovations; Emerging growth companies have created entire new industry sectors such as biotech, online retail, social media, wireless messaging, and many others. Further illustrating the distinction between entrepreneurial growth companies (often referred to as Emerging Growth Companies) and microenterprises, it’s important to note that they come in many different forms. Report author Jon Gregory has coined a 6-term typology to categorize the range of innovative companies: Start Up Sensations Early-stage companies, almost always under 5 years, and in some cases less than 2 years, that have innovative products or services they are seeking to scale nationally or globally. Often seeking outside investment capital, or other forms of specialized startup assistance. Hidden Gems Important contributors to the economy and in many cases relatively unknown in their communities, these companies are often 5-15 years old, and generating between $1-10M in annual revenue. Many maintain potential for significant growth, though in some cases they operate in niche markets. Mid-Market Marvels Also important contributors to the local economy, many of these businesses have been in existence 10-25 years (or even longer) and revenue can vary widely from a few million annually to $50M-$100M or more. They are often significant local employers as well. While some of these companies prefer maintaining a lifestyle business orientation, others are seeking outside capital or expertise to significantly scale their company.
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Emerging Market Leaders Often these companies have highly innovative products, technologies, brands or business processes. They have the potential to become significant market leaders and local icon companies. They cut across a wide swathe of industries. In some cases, they are venture backed, in others they have grown organically with internal cash flow. They can be both early-stage companies, or long-established companies that have “turned the corner� or entered a compelling new market opportunity. Local Innovation Icons These companies represent a small subset of the innovation ecosystem, and well respected as major economic contributors to the local economy. In many cases they are leading employers and are the envy of the community. Global Giants Global giants are typically local homegrown companies that achieved a significant amount of success, and then were acquired by a major national or global company. Alternatively, they can be companies with headquarters elsewhere, but who establish a division or subsidiary in the community. They continue to have local leadership involved in influencing and decisionmaking of the company.
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Understanding Nevada County’s Business Taxonomy The underlying premise of the ERC’s Innovation Scorecard is based on a concept the report’s author created call the Local Business Taxonomy, pictured below. Using the vertical axis for jobs impact, and the horizontal axis for wealth or prosperity impact, the Taxonomy identifies the many different types of businesses that exist in Nevada County, and illustrates that certain businesses have a much higher propensity to create jobs and wealth. For example, a microenterprise, denoted on the bottom left of the graphic, has a much smaller impact than a local icon headquarters company, as depicted far upper right. Local Innovation-oriented businesses are those presented on the right half of the graphic (and befitting of the Scorecard author’s 6-term Entrepreneur Typology described in the previous section.) To the extent a county’s innovation-focused economic development team is able to identify its innovative growth companies – and then systematically bring resources from both inside and outside of the community to help these companies grow – it will stand a better chance of enhancing prosperity, generating wealth, and growing quality jobs. During a brief segment of the ERC’s Scorecard planning session, the Board identified over 75 businesses that fall within the 6-part typology. There is clearly a solid base of innovation and entrepreneurship in existence in Nevada County.
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Unique Impact of Nevada County’s Innovative Growth Companies What is common among these businesses is that they are scalable, selling highly-differentiated products or services into regional, state, national, and sometimes, global markets. These companies bring new dollars into the county and its communities. When Nevada County’s innovative growth companies achieve their business milestones, they grow and create jobs – and generate new tax revenue for essential public services. Moreover, they often serve as springboard companies that can foster new industry clusters. Simply put, when they succeed, metaphorically, Nevada County’s “Economic Pie” grows. As depicted below, not only does the size of the pie get bigger, but so do the individual slices. In today’s dynamic, highly competitive, global economy, Nevada County needs ways to increase its economic pie by being better able to support these types of businesses.
Impact of the Innovation Model
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
It is important to differentiate this small subset of business (generally 15% or less of Nevada County’s business community) that sell innovative, highly-differentiated products nationally and globally from the other 85% that sell almost exclusively into the local economy. An important consideration relative to establishing local economic development strategies is that the success of one business selling solely into the local community often comes at the loss of another local business. Using the economic pie metaphor, the process of local, national and global businesses selling into the local economy either carves up the community’s economic pie into more slices, or redistributes the size of the individual slices. Unfortunately, it rarely grows the size of the pie! This “shifting” versus “growing” of the economic pie is illustrated below. By helping Nevada County-based companies increase their market share regionally, statewide, nationally or globally, the community helps the local economy, Nevada County economy, the state economy, and the country’s economy.
Negative impact of competing businesses… selling to the same market.
Nevada County’s Economic Pie
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Nevada County’s Economic Pie when local innovative companies sell into the same local market.
ERC Business Plan and Economic Development Scorecard, February 25, 2014
The Innovation Value Chain Every innovation-oriented industry has its own unique innovation Value Chain. Within this chain there exist a number of contributors and influencers, including: Regulators and Policymakers Media and Trade Groups Thought Leaders Capital Sources (Debt, Equity and Grant) Industry Executives Sales and Marketing Professionals Universities, Community Colleges, and Federal labs International Trade Liaisons M&A Firms and Business Brokers Investment Bankers Professional Services Providers (Accounting, Legal, Valuation, PR, etc.) Raw Materials Providers, Suppliers and Vendors Logistics, Transportation and Distribution Organizations Strategic Business Development Partners and Acquirers Customers and Competitors Start-Ups, Early State, Mid-Stage and Late-Stage Companies Market Leaders and Global Giants
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Lack of access to the proper value chain element, can severely restrict, and even kill, a growth business. Conversely, accessing the most effective value chain element can dramatically enhance its potential for growth. Successfully navigating the maze of value chain influencers requires key decisions by the company’s owners and/or management team through an ongoing series of “pivot points” during the life cycle of the business. Impediments to a county’s innovation capacity often can be found in its inability to directly or indirectly impact elements of the value chain to the benefit of the innovator. To the extent a countywide economic development effort is successful in addressing impediments found in the value chain – and is able to help its companies navigate through the value-chain maze – it is undertaking “pivot point” economic development (see illustration of Pivot Point economic development below).
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
The Nevada County ERC Economic Development Scorecard Process The Economic Development Scorecard in Nevada County involved a methodology that incorporated multiple contributors and/or influencers of the economic development ecosystem into a discovery and analytical process that assessed the state of local economic development capacity. The Scorecards process was explained during the ERC Strategic Planning Session called the Innovation Board Room held at NCCA on Friday, February 6, 2014. A cross-section of twentyfive (20) city, community, county, education, banking, business, economic development, and innovation stakeholders participated in the Economic Development Board Room session. The purpose of the session was two-fold; (1) develop a shared understanding among the ERC’s stakeholders about the value chain and the impediments which can inhibit economic development; and (2) to identify local innovative firms that are currently, or could, positively impact the Nevada County economy. During the Board Room session ERC Executive Director, Jon Gregory facilitated a process designed to capture data on the importance and local capacity of 60 factors influencing innovative growth companies. Participants were provided ranking sheets from which they shared their perspectives on the factors, which were drawn from 11 major categories. These 11 categories (and the 60 factors) have been determined based on input gleaned from over 2,000 innovative companies and industry experts, and 300 angel investors and venture capitalists since 1999 – to be of potential impact to innovative growth companies. They include: Business Milestones Access to Capital Global Connectivity Advocacy Facilities Sense of Place Technical Resources University/Higher Education Quality and Accessibility of Talent Local Connectivity Transportation/Logistics
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From the list of factors, input was requested in two ways. First, participants disclosed their perception of each factor in terms of its importance to innovative growth companies. Second, they provided their perception of local capacity as it’s related to the factor. Importantly, participants were required to select exactly 20 items each as either Very Important, Important, or Not as Important. Contributors to the data included a mix of businesses, CEOs, health care and professional service providers, bankers, education, government and economic development leaders. Participants included: Lisa Swarthout, City of Grass Valley Debbie Plass, Sierra Nevada Memorial Hospital Dignity Health Tim Corkins, Nevada County Business Association Stephanie Ortiz, Sierra College Nevada County Campus Robert Bergman, City of Nevada City Dale Creighton, Nevada County Contractors’ Association Kimberly Parker, Sierra Nevada Memorial Hospital Foundation Ed Scofield, County of Nevada Larry Jostes, Nevada County Transportation Commission Randy Wagner, Sierra Economic Development Corporation Louise Johnson, Nevada Joint Union High School District Alison Lehman, County of Nevada Judy Hess, Tri-Counties Bank Terry Ann Ferguson, Nevada County Association of Realtors Lynn Wilson, Sierra Vintners Association Jon Blinder, Nevada County Arts Jim Meshwert, Nevada County Business Association Barbara Bashall, Nevada County Contractors’ Association Kathy Hinman, Nevada County Association of Realtors Peggy Davidson, Nevada Irrigation District Findings ERC’s staff all of the data into the Economic Development Scorecard data framework originally developed in consultation with a PHD Academic Advisor, who is part of Management Faculty at CSU, Chico. From the data, a “Top 10” was established for four different categories: (1) (2) (3) (4)
Most Important to Economic Development Capacity Highest Local Capacity Least Important to Economic Development Capacity Lowest Local Capacity
The “Top 10” results for each are presented below:
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Most Important to Economic Development Capacity 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
High Speed Internet Housing Skilled Technical Workforce Local Services and Talent Comparable Cost of Doing Business Available Land Banks/Corporate Finance Quality of K-12 School Programs Cost of Living
Highest Local Capacity 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
Access to Outdoor Activities Cultural Events Outdoor/Recreational Opportunities Connections Locally Peer to Peer Quality of K-12 School Programs Talent in the Regional Marketplace Banks/Corporate Finance Diversity of Lifestyles Getting Around Community Easily
Least Important to Economic Development Capacity 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
Alternative Debt Access to Child Care Bike Travel Outside versus Local Executive Late Stage VC/Private Equity Conference Centers Federal Trade Associations M&A Advisory Liquidity Events
Lowest Local Economic Development Capacity 1. Airport 2. High Speed Internet 3. Commercialization Technology Transfer
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
4. 5. 6. 7. 8. 9. 10.
State Spousal Employment Opportunities Liquidity Events New Facilities Late State VC/Private Equity Conference Centers Federal
Gap Analysis ERC Executive Director, Jon Gregory performed a gap analysis based on the data collected from the ranking sheets in terms of participants’ perceptions of importance of the factor to economic development capacity versus regional capacity. The disparity of the gap – along with the factor’s overall perceived importance – is what determined the level of impediments, as follows: 1. Major Impediments. The most significant gaps (between factors deemed important for economic development and current capacity) are considered Extreme Impediments. This gap represents impediments that are deemed to be the most problematic. 2. Impediments. The second set of gaps are deemed problematic, yet less critical. They, too, merit (lesser) attention during implementation. 3. Minor Impediments. The third are deemed Minor and are believed to be manageable without significant intervention. 4. Low Value. So called, “Low Value” gaps reflect a minor gap between capacity and importance. Nevada County ranks well with respect to its capacity for the factor, yet the factor is not deemed important to foster economic development firm growth. 5. Extreme Low Value. The most significant gaps between capacity and importance (i.e., significant capacity coupled with insignificant effect on innovation) are identified as Extremely Low Value. After organizing all of the data into the various impediment categories, a series of impediments and strengths were identified. In terms of identifying the 4 ultimate impediments, the ERC Executive Director assessed the findings and identified where similarities in impediments existed, as well as observed how important the impediments were to innovation as demonstrated by the Board Room ranking process, and consolidated them into the 4 Major Impediments identified in the Economic Development Scorecard project. Because it is essential for a successful Economic Development organization to maintain sustained focus on 3 to 5 highest-priority items (in the case of addressing Extreme impediments) it has not included identification of the impediments that were not viewed as critical items. A common pitfall occurs when economic development entities attempt to tackle too many priorities, and spread scarce resources too thin, to the point that nothing significant is accomplished, and is not sustainable.
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Economic Development Maturity Model Building a robust local economic environment that fosters growth companies does not happen overnight. The innovation and economic development leadership that Silicon Valley enjoys today took decades to come to fruition through a combination of both planned and serendipitous events that fed off each other into a vicious cycle. To help communities navigate the process of creating such an environment, a 4-level Economic Development Model has been developed for the ERC so key stakeholders can benchmark progress over time in mitigating the impediments inhibiting the ability of innovators to grow. In ascending order, the levels of the Maturity Model include (1) Nascent Level; (2) Limited Level; (3) Emerging Level; and (4) Mature Level. Because the Economic Development Scorecard is intended to help the ERC identify and address the 3-to-5 most pressing Nevada County’s impediments, identified impediments will, in most cases, be at the Nascent or Limited Stage.
Level 4 Level 3
Mature
Emerging Level 2 Limited Level 1 Nascent
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Nevada County’s Major Strengths: A reformed ERC A small county can be more nimble A smart, collaborative community leadership that wants to figure things out Ability for disparate groups to collaborate Accessibility to potential local partners/government Affordable housing Amenities: Arts, outdoors, hospital, college, schools that attract businesses Broadband: newly committed capacity Collaboration Community, intelligence, support and commitment Cost of Living Culture Culture of independent thinking and innovation Desirable place to live and raise a family Diversified economy: tourism high tech, retirees, service businesses Diversity of “Master Mind� personalities and talent pool Education population with skills and resources Emerging health care industry that is hospital centric Generational leadership changes in key companies Good schools Great place to live History Housing, less expensive Innovation/patent producing researches and businesses Innovative tech sector Intellectual capital Jon Gregory to lead the next strategy Lifestyle Lifestyle: attractive for certain population groups Natural beauty, outdoor sporting and life style opportunities Natural resources that people want to live here Natural resources: minerals, water, timber Presence of a base technology industry that has a history and global recognition Quality of life Strong arts and cultural environment Unique high tech industries Very knowledgeable community leaders willing to mentor Weather Welcoming attitude to new industries Well educated workforce World class pool of experienced IT workers and leaders
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Description of the 3 Initiatives
Initiative 1 – Nevada County’s “Fab 5” What: Five high potential existing or new Nevada County businesses receive “organization-wide” intensive support from the ERC executive team, board of directors, and its members/sponsors who play a role for the company much like “the 12th man” for the Seattle Seahawks as an analogy. In totality, this support may be up to 200 hours of volunteer expertise, or roughly 1 executive level FTE for a 5 week period. By virtue of this intensive support, each of the “Fab 5” companies become part of the ERC portfolio and receive help in advancing or achieving one or more tangible business milestones. Three Requirements: 1. The businesses must be located in Nevada County 2. A business milestone(s) must be identified that clearly can be linked to business growth through which assistance from the ERC can have direct impact 3. The business must agree to become a meaningful ($ tbd) member of ERC the following calendar year Why: Businesses face a wide array of obstacles, challenges and opportunities on their path to business success. Often times they need a “pivot” to navigate this process, and often times they do not possess the internal expertise or have time/bandwidth available that is necessary to fulfill a specific activity related to their growth. Below are a few examples, though there are many others: • • • • • • • • • •
Raising capital Securing executive talent or even just entry level workers Finding a suitable location Obtaining a government permit or addressing a government regulation Creating a marketing strategy Undertaking a public relations campaign Landing a key customer or partner in which no pre-existing relationship exists Solving a technical or engineering problem Building a board of directors Planning and implementing a training or special education program for owners or personnel
Objectives of the Fab 5 Initiative: 1. Grow local companies and create jobs in Nevada County 2. Implement an initiative that has clear, direct value to local companies that possess demonstrated growth potential
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
3. Use as a means to promote and provide visibility to ERC (both inside and outside of Nevada County) as a “can do” organization for local growth companies or entrepreneurs Criteria: 1. The business must have a product or service that is (or could be) sold on a statewide, national or global basis thereby “growing” Nevada County’s economic pie and not “redistributing” it at the direct expense of other local businesses 2. The business must demonstrate through its current operations or business plan high degree of potential for success 3. The business must demonstrate it is making an investment as well 4. The business must bring new, immediate jobs to Nevada Co. or demonstrate it will be able to in a 1-year or less timeframe 5. The business must not be competing directly with another existing ERC member company 6. Importantly, the business must identify specific milestone(s) where it is seeking expertise versus just “general support” What Happens: 1. Up to 5 local companies present the ERC with a proposal for ERC support to address a specific business milestone 2. ERC committee evaluates whether it can meaningfully help the company achieve the desired outcome 3. ERC establishes a “Red Team” that provides up to 200 hours of “12th man” expertise to the company to help it achieve its desired milestone(s) 4. Company and ERC actively promote/communicate progress, and report on opportunities and roadblocks in achieving the desired outcome 5. Company becomes an ERC member (if not already one) the prior calendar year, and company agrees to provide a testimonial about the value of ERC’s 12th man services to the Fab 5 companies Needs: 1. Better name, brand and marketing plan to get the word to candidate companies or entrepreneurs (and to showcase the ERC and the Fab 5 companies after they are selected and receive help) 2. Inventory of Executive Team, Board of Directors and members/sponsors skills and influential contacts that can be secured to assist the company. 3. Finalize process for determining process for approving a company to become part of the Fab 5
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
4. Need process for developing “Red Teams” to support a specific Fab 5 company and the amount of time commitment required by ERC (and/or by the Red Team members who become part of the action team to help the company) 5. Web presence, social media campaign 6. Build Fab 5 as a component of each ERC Board meeting (including a report by the Red Team lead as well as a company profile by founder/CEO or someone from the Executive Team 7. Monthly e-blasts or articles are regularly linked to efforts associated to help the Fab 5 8. Explore opportunity for grant funds or contract dollars to supplement the volunteer time or to provide “stipend” support for entities/individuals that become part of a strike team where possible Timeline: 1. Approve going forward with preliminary concept – Feb 2. Create founding/organizing committee – Feb/Mar 3. Develop final selection criteria, initiative brand and Red Team processes (i.e., do we pre-select all companies at beginning of the year, or are they handled on an “as needed” approach or some combination), reporting systems, etc. 4. Pursue candidate companies – April 2014 and ongoing thereafter
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Initiative 2 – Nevada County’s “Golden Challenge” Placeholder Name Until We Get a Good One: The Nevada County Golden Challenge What: Ten businesses vie each year with one winning $250,000 in cash, gifts and free services. One requirement: The Business must move its start-up or existing business to Nevada County The challenge: You compete with 9 other entrepreneurs or business owners to demonstrate why your business is the best fit for Nevada County Objectives: 1. Bring companies and jobs to Nevada County (that are complementary to the attributes of Nevada County thus creating a virtuous cycle) 2. Put Nevada County on the economic development map with something that is viewed as meaningfully unique and will generate sustained local, regional, statewide and even global attention 3. Raise Nevada County’s profile as “THE place for ………..” a certain kind of business Criteria: 1. The business must have a product or service that is (or could be) sold on a statewide, national or global basis thereby “growing” Nevada County’s economic pie and not “redistributing” it at the direct expense of other local businesses 2. The business must demonstrate through its current operations or business plan high degree of potential for success 3. The business must demonstrate it is making an investment as well 4. The business must bring new, immediate jobs to Nevada Co. or demonstrate it will be able to in a 1-year or less timeframe 5. The business must demonstrate why it is a great fit for Nevada County What Happens: 1. Up to 10 candidate companies brought to Nevada County for a red carpet weekend culminating with a public “bake off” with community leaders selecting a winning company they believe is most worth the investment of resources 2. Setting is entertaining so it literally is a “cultural event” and so that residents will want to come out and watch (and buy a ticket!) 3. Statewide or national media publication (Sunset Magazine) partner and some kind of media rep or celebrity either MC’s/moderates the “bake off” or is part of the selection group 4. Extensive outreach for a media tour to get statewide, national, global media to come, observe and cover it!
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Needs: 1. Better name, brand and marketing plan to get the word to candidate companies or entrepreneurs (to this end identify the attributes that should be woven into a brand) a. Suggest ERC launch a competition with education institutions putting forth teams that work with ERC subcommittee to develop this component, and that an award or scholarship of some kind be provided to the winning team or school (could be the high school, Sierra College, Chico State, Sac State, UC Davis or even others) 2. Fundraising campaign (need to look into how to structure this via Kickstarter or Indiegogo) 3. Gifts and free services campaign 4. Media partner(s) 5. Some kind of lottery or prize back to entities or individuals that contribute (i.e., a week-long vacation to Maui, or something!) 6. Need selection panel 7. Need to try and get a “pledge” from a financial institution, individual or government entity who would match the contribution by the ERC fund and the business 8. Web presence, social media campaign 9. A “Champion” Board member (or two) who wants to drive it with Jon 10. Explore opportunity for grant funds to do the various legwork items 11. Explore private label Kickstarter or Indiegogo crowd funding site Ways Entities Can Contribute: •
Many ways; cash, plane tickets, autos, hotel rooms, employment subsidies, free housing, free facilities, free gas, the list is endless……….in the end the total cash or pledges raised needs to be attractively sized # so that media and businesses will find it compelling
Timeline: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
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Approve going forward with preliminary concept – Feb RFP for Student Competition – March Student teams create plan – April/May Research/evaluate best crowd funding option for raising $ for cash prize Create founding/organizing committee – Feb/Mar Fundraising and prize campaign – June to December Compete all pre-launch work – June to December Public launch of the Golden Challenge – Dec 31/Jan 1? Pursue candidate companies – Jan/Feb 2015 Host Bake Off Event – March 2015
ERC Business Plan and Economic Development Scorecard, February 25, 2014
Initiative 3 – Nevada County’s “Royal Welcome” Placeholder Name Until We Get a Good One: Nevada County’s “Royal Welcome” What: Each quarter the ERC rolls out a red-carpet-like “Royal Welcome” to a growth-oriented business that is being targeted for relocation or expansion to the area due to its perceived alignment with Nevada County’s business, cultural and environmental attributes. In a singular 12-24 hour period, the ERC (along with other partner organizations) provides an intimate, compelling experience that is intended to leave a company CEO, founders and/or management team with no choice but to move all (or a key part) of its operations to Nevada County! Three Requirements: 1. The business must be seriously considering a potential location in Nevada County 2. The business must have demonstrated potential to bring or grow jobs in Nevada County 3. The business must not be a direct competitor with an existing Nevada County enterprise Why: Nevada County is a premier location for certain kinds of businesses or entrepreneurial start-ups. For a variety of reasons, businesses exist or are started in sub-optimal locations, for a least a portion of their enterprise. These reasons include such things like as high cost of doing business or cost of living, lifestyle disconnect, talent shortcomings, lack of support from local community, among many others. Nevada County – for certain kinds of businesses and individual business owners/entrepreneurs – is uniquely positioned to present a compelling quality of life and cost advantage opportunity. The ERC intends to identify such businesses, starting with the Bay Area, and persuade them to move part or all of their operations to Nevada County in cases where there is a natural alignment. Objectives of the Royal Welcome Initiative: 1. Recruit one new company (or a division of the company) per year to Nevada County 2. Create a cohesive “we want your business” mentality among business, government and nonprofit organizations that position it for long-term economic success. Through this cohesiveness, develop a collective package of resources and incentives that create a comparable advantage versus other communities and regions
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
3. Generate out-of-area visibility in key geographic markets or industry sectors that Nevada County is an ideal location for enterprise 4. Position the ERC nationally on the cutting-edge as a organization pursuing innovative ways to grow jobs with a unique approach to attracting business Criteria: 1. The business must have a product or service that is (or could be) sold on a statewide, national or global basis thereby “growing” Nevada County’s economic pie and not “redistributing” it at the direct expense of other local businesses 2. The business must demonstrate through its current operations or business plan high degree of potential for success 3. The business must demonstrate it is making an investment as well 4. The business must bring new, immediate jobs to Nevada Co. or demonstrate it will be able to in a 1-year or less timeframe 5. The business must not be competing directly with another existing ERC member company 6. Importantly, the business must commit to be fully engaged during the 24-36 hour “Royal Welcome” and not be distracted by other business or personal issues that minimize ERC’s ability to demonstrate why it is a compelling location for the company. What Happens: 1. Customized tour of recreational, cultural, lifestyle amenities most in alignment with the background of the guest business/entrepreneur 2. In-depth presentation by ERC addressing key business and personal advantages of Nevada County for the entrepreneur/business owner/management team 3. Compelling, personalized gift package of some sort 4. Media visibility for the company (if not confidential) 5. One on One or small group meetings with CEOs, entrepreneurs, business executives that most resonate with the targeted company 6. Exquisite, VIP reception for the guest CEO or entrepreneur with elected officials (city, county, perhaps state and fed in some cases), media, CEOs, ERC Board members, other key stakeholders, dignitaries, etc) Needs: 1. Determine criteria and data bases available to identify the most likely candidate companies or entrepreneurs to target 2. Develop template for what a 24-36 hour “Royal Welcome” Agenda would look like
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
3. Develop resource list of individuals that would be part of the Royal Welcome Red Carpet team 4. Develop marketing messages and materials for reaching out to candidate companies/entrepreneurs 5. Finalize process for determining process for approving a company to become part of the Fab 5 6. Monthly e-blasts or articles are regularly linked to efforts associated to help promote the Red Carpet initiative and spread awareness and build cohesiveness Timeline: 1. 2. 3. 4.
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Approve going forward with preliminary concept – Feb Create founding/organizing committee – Feb/Mar Address items in key needs – April/June Host first Royal Welcome – September occurring quarterly thereafter
ERC Business Plan and Economic Development Scorecard, February 25, 2014
“Draft” ERC Activities Calendar Part 1: Annual Calendar: (Events are used to orchestrate bringing together key components of the community and to add value to current or prospective members and funders) February – Economic Forecast AND Annual Business Awards Combine a business expo component (tour event transitions to this by adding CEO Outlook to the program) March -
Royal Welcome #1
May – Annual Nevada Golden Challenge “Bake Off” Every other year serves as kick-off for Kickstarter Campaign for the Golden Challenge June – Royal Welcome #2 September – Royal Welcome #3 October – Annual Nevada County Talent Fair and Industry Outlook Combine a business expo component (and also tour event transitions into this by honoring and giving visibility to individuals and organizations throughout Nevada County) December – Royal Welcome #4 Part 2: Cornerstone Initiatives: a. b. c. d. e.
Fab 5 (Intensive Support of Local Companies) Nevada County’s Golden Challenge ($250k incentive to a business to locate here) Royal Welcome (quarterly Red Carpet tours for companies we are seeking to attract) Fulfill County Contract (ensure tourism component strong pass through) Explore University Satelite perhaps in alignment with Sierra College for the initiatives may require certain infrastructural improvements which should be considered as priorities on a project by project basis
Part 3: Leveraging/Momentum Building Activities: a. Budget $3,000 for sponsoring 3 to 6 activities by other organizations that can add value to ERC b. Participate in key INS activities that have direct link (Leadership Academy, Innovation Challenge, Innovation Awards dinner, Northern California Investment Fund/530 Angels) c. Media engagement (Monthly e-blast; monthly news article; regular radio participation) Part 4: Day 2 “Stuff” Except where it directly aligns with the above, refer to another organization
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ERC Business Plan and Economic Development Scorecard, February 25, 2014
Identified Local Growth Companies Nevada County has a wide array of promising tech and entrepreneurial growth companies that have an impact directly or indirectly in the local economy. A sampling of the companies follow: AJA Video Ananda Applied Technology Ayurveda College AutoMetrics Beam Easy Living Center Benchmark Thermal Best Trailer, Inc Bio Tech Calendar Boga Paddle Boards Briar Patch Co-op Byers Leafguard Gutter Systems
California Organics Caroline’s Coffee Roasters Cedar House Sport Hotel Center For The Arts Clear Capital Cranmer Engineering, Inc. DeMartini RV Sales Chris’ Collision Repair Dignity Health Electronic Carbide Ensemble Designs Eskaton Senior Retirement Featherlite Trailers
Ferguson Supplies Fifty Fifty Brewing Co. Flour Garden Friar Tuck Restaurant General Dynamics Gray Electric High Sierra Music Festival Hills Flat Lumber Co. Holbrooke Hotel Holdredge & Kull Huntington Mechanical Labs. Lazy Dog Ice Cream Linear Technologies Litton Engineering Labs Maier Manufacturing Micro Precision Calibration Miners’ Foundry Mini Mania, Inc. Miranda Miwall Corp. National Semiconductor Corp.
Nevada City Winery Nevada Irrigation District O’ Republic Brewery Peaceful Valley Farm and Garden Supply A few of Nevada County Business Logos:
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Plan It Solar R.E. McCollum Construction, Inc.
RCD Engineering, Inc. Rare Earth Landscape Mat. Riebes Auto Parts Rincon del Rio Robinson Enterprises Share Point Sierra Cinemas Sierra Nevada Memorial Hosp.
Sierra Woods Smart Light Systems South Yuba Club SPD Market Spiral Internet SYRCL Film Festival Tahoe National Forest Telestream Three Forks Brewery and Bakery
Tour of Nevada City Tri Continent Scientific, Inc. Tri-counties Bank Truckee Sourdough Vulcan Materials Company XP Camper Z.A.P. Manufacturing, Inc.
ERC Business Plan and Economic Development Scorecard, February 25, 2014