Merrimack Valley Startups Pushing Local Innovation, Global Lessons

3/10/14Follow @gthuang

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Parker, the Sandbox head, points to some early metrics: In the past year and a half, he says, more than 600 people have shared business ideas through pitches and startup applications. About 120 mentors have been involved in the accelerator program. And 40 companies have emerged from there, with 70 percent of the first class still up and running. Parker says the biggest challenge now is figuring out the best way to support the entrepreneurs and help them succeed, both during and after the accelerator program.

The Sandbox seems to have struck a chord with the state and local government. Last month, the organization received a $150,000 grant from Massachusetts to boost its mentorship programs. Greg Bialecki, the state’s Secretary of Housing and Economic Development, spoke at last Thursday’s event about how entrepreneurship is driving job growth across Massachusetts, “not just in Boston or Cambridge,” and about how successful entrepreneurs are “not just Harvard and MIT students.”

Desh Deshpande (left) with Lawrence mayor Dan RiveraThe new mayor of Lawrence, Dan Rivera (pictured with Desh Deshpande), made the rounds with entrepreneurs as well, and spoke about the Sandbox’s role in revitalizing the region. “We are a lot further down the path than other cities,” he said to the crowd.

Which is a good start, but it sounds like a long path indeed. It’s still too early, for instance, to talk about the organization’s impact on jobs or education on a city-wide scale. Outside observers say that a few startup successes—and more time—will go a long way toward proving the Sandbox model. In any case, the overall mood at the gala was upbeat, energetic, and realistic.

One potential success story is 99 Degrees Custom. The Lawrence startup, located just upstairs from the event, went through the first Sandbox accelerator program last winter and took part in the most recent MassChallenge session, winning $100,000 in prize money. 99 Degrees does custom apparel manufacturing for retail brands and stores. It currently employs nine and hopes to grow to hundreds of people over the next few years.

Brenna Nan Schneider, the company’s founder and CEO, showed me around the manufacturing floor (pictured below), where stitchers work on custom shirts, jackets, and other clothing for customers including Williams-Sonoma (West Elm). 99 Degrees’ competitive advantage, she says, is “speed to market” based on lean manufacturing and operating processes around machining. The bottom line: end users are willing to pay more, she says, if they don’t have to wait to get their customized clothes.

Brenna Nan Schneider, CEO of 99 Degrees Custom

Schneider comes from a manufacturing family and a business background. An executive job at a “cut and sew” operation in Lowell originally brought her to the area. She seems bent on training her workers to understand lean processes and then move on to higher-paying jobs. Her hope is that the approach can help bring manufacturing jobs back to the U.S. “The model is ‘up and out,’” she says.

Like other participants in the Sandbox, she feels a personal connection to the program. “It’s a very emotional experience,” she says. “These ideas are coming out of a place—and a place that’s having a hard time. It’s more a part of your identity.”

So, what might be the lessons for social innovation in other communities? In a separate meeting, I asked Deshpande for a broader takeaway about how to get buy-in and change people’s minds in the places he’s looking to get involved.

“Use the opt-in process,” he says. “You have to start from the bottom up. Don’t start with the mayor. Do it quietly, and once it catches fire, everyone will want in… But if you try to go sell it, it won’t happen.” In other words, find a few passionate people, give them encouragement and resources, and let them make things happen.

Another interesting point: For businesses in general, Deshpande says to be careful about expanding if you’re still proving out a model. “Don’t think you could be more profitable if you scale,” he says. Instead, focus on becoming more successful in one area before going elsewhere. That point seems crucial to his strategy of testing the Sandbox model before spreading it.

Near the end of the awards ceremony, Deshpande stood up and made a few remarks to the crowd. He reminded everyone that entrepreneurship is a lonely endeavor, and that one goal of the Sandbox accelerator is to “make it less lonely.”

He also had strong words of encouragement for the entrepreneurs in the room. His message was this: Every good company has a near-death experience at some point. When yours comes, and it will, remember this evening; remember the people you see around you; seek out support from your network; fight through it and prevail.

“You are the future of the economy for all of us,” he said.

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com or call him at 617-252-7323. Follow @gthuang

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