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Entrepreneur Boom Hits Maine

Interface Business News
March, 2003
by: Elizabeth Harvey

With the economy still sluggish and the unemployment rate at a nine-year high, a new trend is sweeping across the country. People are starting their own companies. Mainers are among the flock of people looking toward self-employment as a means to make a living in tough times. In fact, 96% of all businesses in Maine employ fewer than 20 employees and 61% employ fewer than 5 employees.

Diane Hahn, the Director of Training and Communications for the Maine Small Business Development Center explains the new trend in Maine, "A lot of people are moving to Maine from different parts of the country for a lifestyle change - for more of a community type environment. They come to Maine bringing a different set of skills and an entrepreneurial spirit. They are bringing their technical and business skills with them — they're not leaving them at the border."

Boston native, Rich Brooks explains his reasons for starting flyte new media, a Web design and development firm, "I started my own company because of the opportunity that the Internet presented. It allowed me to run my business from anywhere and have clients scattered all over the country. Some of my biggest and best clients are from California; they like the lower prices we can offer compared to our West Coast competitors and I love the lifestyle I have here in Maine."

Since 1990, the number of new businesses started annually in Maine has grown by 17%, from 3,980 new businesses in 1990 to 4,670 new businesses started in 2001. Prior to the events of September 11th, Mainers were consistently starting new businesses at a rate of over 5,000 per year.

Over the ten-year period from 1990 to 2000, Maine ranked 21st out of 50 states in rate of growth in new businesses started, a significantly higher ranking than Maine's general population rank of 40 from the 2000 Census.

Maine has had to overcome a lot of barriers. Originally, its revenues came from the tourism, timber, and fishing industries. Maine is moving beyond traditional industries with success stories like Correct Building Products in Biddeford who makes composite lumber from sawdust and polypropylene for deck building and JSI Store Fixtures in Milo, Maine who manufactures and distributes retail store displays nationwide. Likewise, John Otterbein came back to Maine to start the Wooden Screen Door company in Waldoboro. All have created a new twist on the typical Maine timber company. Smaller food companies like Stonewall Kitchen and the Maine Sea Salt Company prove that local specialty food industries can make it here, as well.

Hahn says that Maine is "a good incubator. A lot has changed in Maine as far as support. If you can make it in Maine, you can make in anywhere."

Support has come from places like the Maine Technology Institute, established to provide grant money and seed capital to aspiring technology companies in industries such as biotechnology, acquaculture, software development, and composites.

SCORE, the Service Corps of Retired Executives, offers one on one counseling to help people achieve their business goals. They also offer monthly workshops on starting your own business, writing a business plan, and marketing and sales, as well as a quarterly workshop on buying your own business. SCORE volunteer, Stephen Edmondson says they've seen a resurgence in the last year, "Things were quiet a year ago, now they're not."

Similarly, the Maine Small Business Development Center provides one on one business consulting at no charge for clients. They also provide technical assistance to people starting a business and already in business. New business owners can get information on capital sources, marketing, operations, and employee management capital. The Center is the first point of entry to someone who needs help with his or her business.

Dwight Sholes, founder of Quotient Marketing, an email marketing company, found the folks at the Small Business Development Center to be "an incredible resource. They gave us assistance with our business plan, hooked us up with a prominent local law firm that helped us incorporate for a minimal fee, and have been there at every step with support and guidance."

Sholes continues, "Although Maine has a reputation as a tough place to do business, I don't think that it is necessarily a hard place to start a business. Owning a business is an incredibly exciting, rewarding and interesting experience. It is also an incredible challenge, a roller-coaster ride full of ups and downs and twists and turns that you can't even imagine until you do it yourself. We have been in business for just one year, and in spite of the poor economy and myriad challenges, we are profitable and are excited about the future. But I have never worked so hard, and enjoyed myself so much. It isn't for the feint of heart, but if you can ride out the ups and downs it is an incredibly rewarding experience.

Lisa Fernandes of Cape Elizabeth started The Hibernia Group in 2001. Her company helps small businesses use ACT! Database software to better manage their client data. "I decided to start my own business because I enjoy the flexibility and creativity possible in a small organization. It is also a way for me to maximize the return on my personal investment of time and effort in the work world; the return does not just include profit, but also enjoyment, a constantly changing environment, and the satisfaction of immediate results."

On the flip side, many entrepreneurs start here, become successful and then because of greater business demands are forced to move out of the state. Two such companies are Burt's Bees which moved to North Carolina in 1994 and Fresh Samantha which was bought by Odwalla and moved its operation to southern Florida in 2001 to be closer to its fruit supply.

John Holt founded Holt Consulting Group to help businesses continue to make money--even in a down economy. "With the increased pressures on sales and profits, maintaining the delicate balance between staffing costs and maintaining marketing and business momentum is critical." He adds, "Building a successful consulting practice is especially intriguing to me during this stage of my life and career. With a new family, including a 3-year old and a 4-month old at home, the flexible work style allows me to spend more time with my family, yet still work as hard or even harder than I did before. It's like getting the best of both worlds."

Likewise, Martha Bradley established Project Solutions, LLC in 1997, as an event planning business. "There was a need for event planners in the Portland area to produce custom events. With the economy ever so changing, it makes sense to outsource events instead of overloading current employees or hiring someone new. Being an entrepreneur has allowed me the opportunity to blend my work with my life, allowing for flexibility to maximize time with my family."

Similarly, Mark Sengelmann, owner of Port City Design, Architects and Planners located in Portland for the quality of life for his family and quality of work for the company. Meanwhile, Peak's Island resident Craig Davis who founded Two Dog Design, a virtual ad and design shop says running a business gives him more control over his time and income. "It's been a pretty good year, definitely with ups and downs. But overall I've been glad to be out on my own. And now, if I'm not busy I really only have one person to blame."