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Warren’s TBEIC Incubator Begins Accepting Tenants
WARREN, Ohio -- When Dave Nestic accepted his position as chief executive of regional operations at the Tech Belt Energy Innovation Center here, he didn’t bite off more than he could chew. But he might have gotten a bit more than he bargained for.
“I will tell you that when I started, I said, ‘This is a 24-month job,’ ” he recalls. “At the end of 24 months we should have a building. We should have a program. And we should be able to then go out and hire a full-time executive director.”
Three years and a few snags later, his vision for a technology incubator focused on the energy industry is about to become reality. Construction of the center known as TBEIC (pronounced T-Bike) is nearly complete and it begins accepting tenants in January.
Nestic projects the 37,000-square-foot incubator, in the former Kresge building in downtown Warren, will be home to three tenants its first year and 15 by year five.
TBEIC is both a business incubator and a technology center that focuses on energy and natural resources.
“With [information technology], if you have a laptop and a basement you can start a company,” he says. “We’ll probably have more manufacturing needs. We’ll probably have more specialized equipment needs.”
The specialized equipment is key to TBEIC’s role as a technology center. For example, a company that designs fuel cells might need to test a prototype. Instead of purchasing an expensive piece of equipment, businesses will have access to it at the incubator at a fraction of the cost.
“Some of this equipment might be available at a large institution, but to get to use it, there’s a lot of legal documents. It could take six months to get access,” Nestic says. “We’re an easier-access facility. It doesn’t take that long.”
That’s one reason why two companies, MegaJoule and Yanhai Power LLC, are eager for the center to be up and running.
“Our center of gravity might move to Warren,” says Herb Crowther, president of MegaJoule, a company based in Cleveland.
Crowther describes it as an “early stage company developing energy storage for stationary applications,” meaning it creates products similar to industrial-scale batteries. A common application is placing the batteries between renewable energy and the power grid to supplement the absence of power at night in the case of solar energy.
Commercial buildings also use the technology to reduce their electric bills or prevent interruptions in power. “Every building in Washington has a basement full of batteries,” Crowther says.
However, the MegaJoule product isn’t a battery. A slight tweak in the construction means it’s actually a capacitor. “All the customer cares about is that we get 10 times the life of a lead-acid battery and we have the ability to charge very rapidly,” he says.
Crowther isn’t sure whether MegaJoule will become a tenant in the center. Regardless, the company will definitely have some presence and activity there. “We’re eager for them to open the lab there and acquire the hardware that will allow us to test our products,” he says.
The testing area at TBEIC is on the second floor at the top of two long, wide staircases. The executive offices on the third floor overlook it.
On this day in mid-December, workers are busy painting walls and running wire throughout the building. “It’s finishing work now,” Nestic says.
Among the other amenities are a kitchen and conference area on the ground floor. A demonstration room with a large window will provide passers-by on the square the opportunity to look at showcase projects taking place inside.
Space for tenants is available on two floors as well as the basement, where the least expensive units are. Nestic says the layout of the building makes it flexible to the needs of its tenants. “If we need to build more offices we can build more offices.”
The hope is that TBEIC will become a resource for startups as well as existing companies throughout the region and beyond. “Some of the [equipment] we’re contemplating may be unique to the United States,” Nestic says.
Already TBEIC is holding discussions with several companies about their needs so it can get a better grip on equipment to purchase. One company holds a patent for a commercial refrigeration system. “As they grow they might need to take space in the back warehouse to put together a test rig with their prototype and start taking data,” the director says. “We might help them acquire equipment that’s necessary to do that.”
Nestic makes a point to say the mission of TBEIC isn’t to replicate what other companies are doing. Rather, the incubator is meant to augment the work in progress while also nurturing new companies that have good ideas. “It would be a benefit of those companies to locate here,” he says.
Yanhai Power sees the benefit. The company, based in Irma, S.C., holds a patent for a new fuel cell design that would greatly increase the volumetric power density of a fuel cell.
The founder, Yanhai Du, has been visiting the center regularly in search of space and equipment. “Getting equipment is very challenging for any startup,” he says. “You don’t have a budget for equipment.”
Those who do have the funds, he adds, often find equipment a risky investment since they don’t always know what their next project will be. The TBEIC model “helps companies maximize their capacity at a minimum capital expense,” he says.
Yanhai intends to be one of the first tenants at the center, citing its network as a key selling point. “[TBEIC] can help us develop a business plan or with legal advice,” he says.
He also likes the flexibility the center provides, allowing him to use as much or as little space as needed. Parking nearby is another benefit. “You couldn’t find another downtown with parking that close,” says Yanhai.
Having energy companies relocate to downtown Warren is exactly what U.S. Tim Ryan, D-13 Ohio, had in mind when he spearheaded the project four years ago.
“This is a byproduct of the whole regional collaboration and creation of the TechBelt,” he says.
Wanting to duplicate the success of the Youngstown Business Incubator and the impact it was having in that downtown, Ryan secured $2.2 million dollars from the U.S. Department of Energy for the project. “Whenever the taxpayer is spending money, you want to get a multiplier effect, you don’t want to just make an investment,” says Ryan.
Having TBEIC as an anchor downtown was the key. “With this you get the incubator, you get to refurbish an old downtown building,” and an increase in “activity in the square” should result, Ryan says.
The center is also part of the congressman’s plan to prevent recurrences of earlier economic collapses by diversifying the economy. Since the YBI was already focused on software, TBEIC needed a different one. Ryan saw energy as an obvious choice.
“I think we’ve proven over the past decade or so that these ideas are really starting to bear fruit for us and gain us national attention, not just that we’re doing it but where we’re doing it,” he says.
Ryan believes the presence of TBEIC, as well as the new center for Eastern Gateway Community College in the former Mickey’s Army/Navy building, will be a transformative force in the downtown.
“Now you’ve got foot traffic so the shops in downtown are feeling the effects,” Ryan says. “Eventually you’re going to want some housing.”
Meanwhile, Nestic is pleased a lot of hard work is about to pay off. “It’s a very complicated and messy process,” he says. “It took some dedicated people to do it. When I say dedicated, I mean people aren’t getting fully paid for all of this.”
For the past three years Nestic has been cutting through miles of red tape, working with four project managers at the DOE and raising roughly $1.7 million dollars in matching funds to keep the project moving.
“So, yeah. It feels good to have doors to open,” he says.
Pictured: Dave Nestic looks forward to the Tech Belt Energy Innovation Center accepting its first tenants in January.
Copyright 2014 The Business Journal, Youngstown, Ohio.
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