Mainebiz

V O L . X X I I N O. X V 46 FA C T BO O K / D O I N G B U S I N E S S I N M A I N E I N N OVAT I O N / R & D M aine is the northern terminus for Interstate 95, which runs from heavily populated Florida to the sparsely populated tip of Maine, where locals still occasionally use the famous "you can't get there from here" catchphrase. But that is changing. As Gov. Paul LePage is fond of saying, the state borders Canada and is a quick ride by rail, water, airport or truck to Boston or New York, so there's a combined market of 60 million people eight hours north or south of the state. And even though the state has a total popula- tion of only 1.3 million people — some 37 people per square mile — and lacks a robust local market for some goods, it has nonetheless managed to set up pockets of expertise and tax incentives like the Pine Tree Development Zones program, in which 280 Maine businesses participated in 2014. It also has at- tracted out-of-state companies that want to expand into less costly areas with available local talent, like Massachusetts-based homegoods e-commerce com- pany Wayfair's forays into Bangor and Brunswick. Venture capital and angel investors also are looking north from Boston and New York to support the state's start-up companies. Some have raised outside capital and others have seen lucrative exits. For example, online pet portal company Vets First Choice last summer raised more than $52 million in expansion capital, mostly from investors outside Maine. e company grew to $45 million in revenue in less than fi ve years. Vets First Choice is one of sev- eral veterinary companies clustered around Portland and sparked by the success of veterinary diagnos- tics maker IDEXX Laboratories Inc., which has a market cap of $7.95 billion. And this March, Portland veterinary pharmaceutical company Putney Inc. was sold to Dechra Holdings USA Inc. of Overland Park, Kan., for $200 million in cash. Safeguard Scientifi cs Inc. of Radnor, Pa., had a 28% primary ownership position in Putney. It expected to realize $58 million in aggregate initial cash proceeds upon completion of the sale, almost a 3.9-times cash-on-cash return and a 42% internal rate of return on its $14.9 million invest- ment since September 2011. Incubating innovation Maine's innovation activities may be modest compared to the Boston/Cambridge and Silicon Valley areas, where start-ups, universities and investors almost spontaneously generate new companies daily. Yet the state is creating a fertile environment for start-ups and fi nanciers. Maine's clusters still are small and focused on populated areas like Portland, Bangor, Brunswick and Bar Harbor. In addition to veterinary compa- nies, Portland has a cluster of disability insurance companies, including Chattanooga, Tenn.-based UNUM Group's largest offi ce. It also has an active start-up scene that includes agencies to help entre- preneurs with everything from preparing business plans to meeting mentors and potential funders. Among them are SCORE, the Maine Center for Entrepreneurial Development and Maine Startup and Create Week. e Bangor-Orono area is home to the main campus for the University of Maine, known for its Advanced Structures & Composites Center. Nearby, some UMaine spinouts and other com- panies are in a collaborative working space at the Target Technology Incubator, which includes an advanced infrastructure company and a company making fi ne fi lters for water and other fl uids. Bar Harbor has two world-renowned biosci- ence laboratories, Jackson Laboratory (known for breeding test mice and cancer research) and MDI Biological Laboratory (known for regenerative medi- cine), plus the experimental College of the Atlantic with only 350 students focused on human ecology studies. In the midcoast area, in East Boothbay, Bigelow Laboratory for Ocean Sciences recently launched two new Centers for Venture Research to apply business and project management techniques to ocean-related research projects to get them into public use more quickly. One center will focus on Arctic research and the other on seafood security. Brunswick Landing, a former naval air sta- tion that has been turned into a high-tech busi- ness campus, includes a startup incubator called TechPlace and companies with aerospace expertise. Wayfair is among the newest tenants — it plans to hire close to 1,000 Mainers between its operations in Brunswick and Bangor. Brunswick Landing also is home to the Maine Technology Institute, which gives start-ups and other companies grants and loans to move their businesses forward. At TechPlace, more than 24 tenants have offi ce and/or manufacturing and lab space where they can operate from a plan on a napkin to building a proto- type. Innovators there are developing sport airplanes with folding wings that can be stored in a garage or ridden on the water, a tissue-culturing system (a branch of Swiss biotech company InSphero) and even a lightweight jacket that travelers or journalists going to war areas can wear and that can stop a .44 Magnum bullet at point blank range. Add to that a more traditional business that is applying modern technologies to its prod- ucts: guitars. Bourgeois Guitars, which makes acoustic guitars used by artists including Ray LaMontagne and by last year's winner of " e Voice," 15-year-old Sawyer Fredericks. It is test- ing a machine at Brunswick Landing that creates torrefi ed wood (heated at high temperatures) from treated Adirondack red spruce. e result is an instrument that sounds like a decades-old vintage guitar. e company received a $25,000 seed grant from the Maine Technology Institute and matched that grant with more than $125,000 to buy the torrefaction machine. P H O T O / T I M G R E E N WAY Maine: A place to vacation and invest? Lifestyle and work don't have to be mutually exclusive B y L o r i V a l i g r a Benjamin Shaw, CEO of Portland-based Vets First Choice, which raised $52 million in 2015.

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