Ninth Star

The Entrepreneurial Edge June 9, 2012

How do you create an entrepreneurial ecosystem? As the job generators of our economy, small businesses are the touchstone for economic recovery and vitality. It stands to reason that you need to grow a lot of small businesses in order to grow a few larger ones. There are growing signs of strength in Alaska’s entrepreneurial ecosystem including new sources of financing and new creative energy to help businesses achieve the entrepreneurial edge.

Financing edge
Alaska entrepreneurs have access to new sources of capital. The 49th State Angel Fund (49SAF) has been established through funding from the U.S. Department of Treasury’s State Small Business Credit Initiative. Thanks to the efforts of Allan Johnston, Lucinda Mahoney, and the Anchorage Assembly, 49SAF will make more than $13 million in risk capital available to Alaska entrepreneurs. While Alaska has a strong and steady banking community, financing startups can be difficult within corporate constraints. This new source of risk capital fills a gap in the financing continuum in Alaska, so that new businesses can start, grow, and flourish.

Alaska will also soon have five new specialized revolving loan funds that will help grow new opportunities. The Alaska Division of Economic Development will be adding funds for alternative energy and conservation for commercial buildings, small business microloans, commercial halibut fishing charters, shellfish mariculture farming, and qualified community-based commercial fishing organizations. Combined, these funds will make $25 million available to finance business startup, expansion, and efficiency.

With a strong, steady, and ready-to-lend banking community, a cadre of individual angel investors, and these new sources of financing, Alaska entrepreneurs have increasing options to fuel their startup activity.

Creative edge
For the past dozen years, the University of Alaska, Alaska Pacific University, and supporting organizations have sponsored entrepreneurial boot camps and business plan competitions. The 2012 business plan competition winners presented plans for commercializing unmanned aircraft for security, sensing, and navigation; controlled environment agriculture to grow micro greens, herbs, and lettuce for the restaurant and food service sectors; and a gaming lounge to stage gaming tournaments and appeal to aging gamers and their game savvy children.

Past competitors and winners have continued to pursue their entrepreneurial dreams. The Alaska Distillery continues to extend its product line with the successful introduction of Purgatory Vodka this month. Those creative minds behind Gear Spoke seek to the answer that eternal Alaskan question, how do I leverage my existing outdoor gear, so I can finance still more gear? And, Great Northern Peonies is one of more than 50 peony farms developing throughout Alaska by leveraging the counter-cyclical Alaska growing season that just so happens to coincide with the summer wedding season.

Adding to the ecosystem
While efforts to improve the entrepreneurial ecosystem in Alaska are ongoing, new sources of financing and the energy of creative entrepreneurs provide a solid foundation to help accelerate the development of new Alaska businesses, jobs, and ongoing opportunities. What steps do you think we need to take to nurture Alaska entrepreneurs? Please share your comments and suggestions!