LOS LUNAS — Starting a small business can be a challenge for the novice, but a small business incubator can help entrepreneurs with support services while they build their business.
A feasibility study completed last month found that a small business incubator is feasible in Valencia County, especially in the area of edible products.
“There’s a strong presence of entrepreneurial activity in food production, food products,” said Russell Combs, the managing director of IOTA — Incubation Operations, Training and Applications, who was contracted to perform the study.
Combs said at least eight community entrepreneurs are already working out of their homes or garages and ready to take their businesses to the next level.
“I think there is a great need in our community for a local, small business start-ups because it can be intimidating, just knowing where to go,” said Los Lunas Mayor Charles Griego at the Feb. 8 village council meeting. “Having a clearinghouse would be perfect for that process.”
The feasibility study included analyzing demographics, business licenses and renewals, talking to small business owners and potential entrepreneurs as well as interviewing focus groups.
More than 60 people participated and 21 more gave information but wanted to remain anonymous, Combs said. The results indicate the county would need a mixed use, kitchen incubator.
“We recommend a virtual incubation program,” Combs said. “Not one desk somewhere but a smaller facility where the core presence, identified in the study, of entrepreneurs can learn what business incubation is about, what start-up is all about.”
A small business incubator is a facility where a number of entrepreneurs can set up shop and test market waters. Members share the expenses of leasing a building and services, such as accounting, mentorship, networking and other services that help an entrepreneur grow their business, their brand and business acumen.
The next step is to organize a steering committee to create the vision and scope of work for future goals.
Bob Skerry, the Rio Communities city manager, said small employers are needed.
“We need the big guys but I think you have to build your base with small employers as well,” Skerry said. “Small business incubators offer the small people a chance to be able to compete.”
Skerry and Ralph L. Mims, the village’s economic development manager, will spearhead the formation of the steering committee.
“We need to support our small, start-up businesses,” Mims said.
The first goal of the committee will be to start the process of forming a separate 501c3 so there is autonomy between the political communities and the incubator, Combs said.
“Some of the monetary support comes from the communities but typically in a start-up phase, there are numerous funding silos that the start-up phase can tap into,” he said.
Funding from HUD’s economic division, the federal Economic Development Authority, and the USDA have grants for economic development. The USDA has grants as well as revolving loans funds that can be used for operations and start-up businesses.
“Typically, the local support is 5 to 10 percent and (USDA’s) is 90 percent,” Combs said.
A grant from the USDA was awarded to the village to pay for the $24,500 feasibility study. The village also chipped in $5,000 and Rio Communities contributed $1,650.
Further inquiries can be directed to Mims at 839-5654, or Skerry at 859-1789.