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Re-establish Merrimack Valley as a Premier Entrepreneurial Hub

Inject capital and support resources
Unleash our diverse communities’ talents
Support companies to start, grow and stay in the region
Re-cast our image as open to entrepreneurs

Merrimack Valley was once the center of innovation for the world. These pictures provide a glimpse into the proud history of our region. The Merrimack Valley revolutionized water mill design, drove the American industrial revolution and our textiles literally clothed the world. We were Silicon Valley before there was a Silicon Valley.

Unfortunately – once thriving businesses and factories now sit empty and downtown cores have decayed. But it doesn’t have to be that way. Our team’s vision is to help Re-establish Merrimack Valley as a Premier Entrepreneurial Hub and we aim to do this by creating the Merrimack Valley Venture Fund – a focused entity dedicated to:

Injecting new capital and providing critical support resources to promote greater regional entrepreneurship

Fostering and unleashing the region’s talent by better engaging our increasingly diverse communities and ethnicities

Incenting and actively supporting our companies to start, grow and most importantly stay in the region.

And finally

Re-casting our image as a business-friendly, optimistic and growing region. Resulting in attracting more entrepreneurs.

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… And we have built & recruited the team to make it a reality!

Entrepreneurs and For Profit

Not For Profit

Government

Banking and Finance

Cross Functional with a Proven Track Record
Passionate about improving the Merrimack Valley business ecosystem
Over 200 years of business experience in the region!

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Local Small Businesses and Entrepreneurs are Starting and Growing their Businesses Elsewhere

Business Issues:

Difficulty in Securing Capital
Access to Support Resources

Conducted significant customer discovery process with businesses, chambers, government, incubation centers, universities and more …

Unaware of Existing Capital and Support Resources

Let’s spend a moment and investigate the root causes for the region’s long term business decline.

Our team conducted 2 dozen interviews with small businesses and entrepreneurs from the region. We also met with local Chamber of Commerce representatives, city Government officials, Incubation hub leaders, University officials, public-private partnerships entities and state Government representatives.

The conclusion was clear. While Merrimack valley residents continue to generate plenty of innovative ideas, Small businesses and entrepreneurs from the region …. are starting and growing their businesses elsewhere.

While time doesn’t allow us to tell you all of their stories; but we can highlight the main themes with two real-life personas:

This is Dara. She is a 33-year-old Cambodian American whose parents emigrated to Lowell as refugees. After she graduated from Lowell High School, she had an interest in the make-up/ beauty industry and saved all her money to attend esthetician school. Initially Dara rented a chair part-time at a salon, but wanted to build her own business, focused on her novel beauty concepts.

Kabir is also first generation American. His family moved from Sri Lanka to Lawrence. He studied hard, graduating with honors from the UMass Lowell Plastics Engineering program, and joined a biotech firm in Boston. Ever the engineer, Kabir invented an inexpensive plastic syringe that could deliver vaccines more cheaply than current alternatives – and with his own savings, he built his initial prototypes.

But despite being ambitious and successful, both struggled to (i) secure capital and (ii) access support resources in the Lowell area. Even though they wanted to stay here.

Ultimately, Dara chose to locate her new salon in Westford – and where it was easier to secure retail space and parking; and the commute made it easier for her customer base.

Kabir re-located his company to Cambridge in order to secure a $10M venture capital investment. Investment he couldn’t find locally. He puts up with the higher rents, salaries and transportation costs to accommodate his investor’s requirements.

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But in our interviews we found one more insight …. While all businesses and entrepreneurs brought up a lack of available capital. We also discovered that often times they were unaware of EXISTING sources of capital.

For instance Kabir did not know his private investors would have been eligible for the “Opportunity Zone Equity” program – providing them a tax incentive to re-invest their unrealized capital gains in his company.

And because of the difficulty and complexity of the application process, Dara never applied for an MGCC grant or an LDFC Downtown Venture loan.

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The “Entrepreneurs’ Awareness Gap”

Boston - $593M; Cambridge - $585M

Worcester - $134M

Lowell, Lawrence and Haverhill�(Combined) - $6.7M�5% of Worcester

SBA and EIDL loans for Lowell businesses are significantly behind other Gateway cities

4 year old incubator loan program is only 50% deployed
Downtown Venture Fund ($100K) has averaged less than 2 loans/ year

Current Information is:

Out of Date Information
No “one-stop-shop” – myriad diverse sources and sites
Poorly marketed
Neither multilingual nor culturally sensitive
No live “on-the-ground” support

Dara and Kabir are not alone. Many of our entrepreneurs are unaware of the many existing programs that have already been created with them in mind.

Moreover, the problem is systemic and the statistics bear this out

We reviewed Mass Development’s 2020 annual report , and it clearly shows how little our region applies for and receives state funding;

In 2020 Boston and Cambridge each received around $600M in funding,
And just so there is a slightly closer comparison, Worcester received about $134M.
The amount for Lowell, Lawrence and Haverhill COMBINED was just $6.7M.
Our cities received just 5% of Worcester’s funds.

At the national Level: The percentage of awarded EIDL and SBA loans for Lowell (as a Gateway city) are XXX 30-35% XXX behind cities based on similar size and economic conditions. (Still confirming exact number.)

Even at the Local level: Lowell Development Finance Corporation (LDFC) started an Incubator loan program over 3 years ago ($100K secured loans) for qualified startups. Since inception only 5 awards have been made (out of 6 applicants.). But $1M has been allocated to this activity – only 50% granted. LDFC downtown venture fund has made just 49 $100K higher-risk loans on in 21 years. ~2 loans per year.

I want to be clear – this is *not* to denigrate any of these organizations. Rather – our businesses are not applying for not receiving these services at the level they were intended. But in their defense, we have made it too difficult for them

Current information is usually out of date and links are only to high level websites or programs

They are *not* cross functional; individual websites - Forcing the overtaxed entrepreneur to navigate through all the following sites:

Banks

Government financing sites

Government permitting sites

Entrepreneurial resources

Real Estate

Information sources are not at all marketed – no significant use of SEO and SEM. It is usually word of mouth that drives engagement.

Information sources are not accessible – they need to be multi-lingual, and brought in a culturally effective manner.

And there is no on the ground support to provide help – a resource the entrepreneur can reach to.

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�

Create an (i) entrepreneur-oriented, (ii) one-stop, (iii) actionable, & (iv) multi-lingual repository of available business resources

Integrate Digital Marketing and API Technology

Provide a dedicated live resource to help the businesses/ entrepreneurs navigate the system

Conduct community outreach efforts with emphasis on our diverse neighborhoods and ethnicities.

Start in Lowell

Solution: Minimum Viable Product

Address “Awareness Gap”

Increase Applications
Increase Awards

Improve Business Climate

Increase starts and retention of Lowell businesses

Empower the latent entrepreneurial talent in Lowell

And that’s where our MVP comes in. While our long term goal is still to raise and inject more capital through a dedicated fund,

We want our have our MVP laser focus on three specific targets -

We want to create an (i) entrepreneur-oriented, (ii) one-stop, (iii) actionable, (iv) relevant, (v) easily accessible, & (vi) multi-lingual repository of business resources. It is much more than a static website

- Integrate Digital Marketing (SEO, SEM, Inbound) and Application Programming Interfaces (API) Technology

- Simply put, none of the sites available today use these

Provide a dedicated live resource to help the businesses/ entrepreneurs navigate the system

- In addition to supporting the businesses, this individual will conduct community outreach efforts with a heavy emphasis on our diverse neighborhoods and ethnicities.

- We envision him or her to be part of one of these communities.

And finally though we want to impact the entire Merrimack Valley, our MVP will hyper focus initially on Lowell – with an expectation that if we can refine our model and prove it here, we will rapidly expand it throughout the region.

If done properly, the MVP will accomplish three things

Address “Awareness Gap” as measured by increased applications and Increased Awards and Grants to Lowell businesses
Help Improve Business Climate as measured by Increased business starts and retention
And if successful it will Demonstrate the latent entrepreneurial talent that exists in Lowell

We have taken a crack at what this might look like ….

******************************************************

The MVP implementation will be a website and community outreach effort that will include business resources available for (at a minimum):

Small business grants (local, state, Federal)

Incubators (e.g. iHub, EforAll, M2D2, River Hawk Venture Fund)

Lowell Development Finance Corporation

Commercial Real Estate Incentives

Small Business Administration Grants

Mass Development (MassDev)

Massachusetts Growth Capital Corporation (MGCC)

Opportunity Zone Equity

Small Business Innovation Research / Small Business Technology Transfer

Tax Incentives and R&D Tax Credits (TIF)

Bank Loans, esp. low interest

EIDL

Etc.

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Design Link

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Detailed Work Plan for MVP / Phase 1

Phase 1A: 3Q’21 (3 month) $7K

Complete wireframe and develop specific site specifications $2K
Begin Web Dev and Web Marketing�Definitions (including APIs) $3.5K
Focus groups, prioritize languages, & �engage translation services $1K
Set MVP goals for

Improvement metrics for�(i) applications submissions and �(ii) awards/ grants
SEO and SEM (budget/ metrics)

Job posting for dedicated hire/ conduct interviews
Raise funds for Phase 1B Activities $0.5K

Phase 1B: 4Q’21/ 1Q’22 (6 months) $175K

Complete Web Dev formally launch the MVP site
Maintain and market the resource to the community
Hire dedicated resource
Engage community via outreach efforts
Hit budget and timeline targets

Strategy and Management: Volunteer
Oversight & office space: GLCC
Web Dev, Web Marketing, Hosting, Dedicated Community Outreach, Translation $125K
Dedicated resource $50K

The team has pulled together both an ambitious and at the same time realistic plan to make the MVP a reality.

In Phase 1A (Our three month window starting on July 1^st of this year), we will:

Complete wireframe and develop specific site specifications
Begin Web Dev and Web Marketing Definitions (including APIs)
Prioritize languages & engage translation services
Set MVP goals for Improvement metrics for (i) applications submissions, (ii) awards/ grants, and SEO and SEM (budget/ metrics)
Ensure we have a job posting for dedicated hire/ conduct interviews
Raise funds for Phase 1B Activities

This is expected to cost about $7K

In Phase 1B: (The following quarter starting in September 1^st of this year), we will

Complete Web Dev efforts and formally launch the MVP site
Maintain and market the resource to the community
Hire dedicated resource
Engage community via outreach efforts

This is expected to cost about $175K

As far as logistics are concerned, we had a meeting with the Greater Lowell Chamber of Commerce President, Danielle McFadden –

And not only is she is supportive of the project, she will house and provide day-to-day management of the dedicated resource

Strategy and Board Management: Volunteers – basically the team that you see here

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Re-establish the Merrimack Valley a premier innovation hub�

Phase 1a: 3Q’21

Design and Build MVP

$7K

Phase 1b: 4Q’21 – 1Q’22

Stand up MVP in Lowell

$175K

Phase 2: 2022 - 2023

1. Expand program to Lawrence & Haverhill

2. Raise additional capital resources

$325K

Phase 3: 2024

1. Continue to Provide Existing Services

2. Launch Merrimack Valley Venture Fund with deep insight and connections to the region.

Self-funded by LPs

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Victory Definition! By 2024 …

The next Dara and Kabir:

Stayed in Merrimack Valley and are now

Limited Partners in MV VC Fund I

Full

Local businesses and downtown cores are once again vibrant

Community Impact (i) By 2025 – More businesses in Lowell, Increased tax revenues, Hamilton Canal successful and filled with startups, Hamilton Canal #2 started, downtown space occupied, greater emphasis on local support, overall housing prices increased, Median wage increased, a safer and more vibrant Lowell/ MV

Entrepreneur impact (i) By 2025 – Kabir and Dara were connected to their initial sources of capital through MVP 1.0. And stayed in Lowell. As they grew their business, they have leveraged their efforts into an investment form Lowell/ MV VC Fund. And with the capital have built successful businesses.

By 2023 – Dara (she franchised her business) and Kabir (he sold business to biomed/ Fortune 500 company) are both now limited partners in Lowell/ MV VC Fund – putting significant resources into the region and driving the next wave of entrepreneurs. And this is how the first step in re-establishing our place as next innovation hub.

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Join us on our Journey …

Our Ask Today:

Initial Seed Funding of $7K for Phase 1a
Feedback and advice
Suggestions/ connections for funding sources for Phase 1b and beyond

Government Programs (Federal, State, Local)
Banks and Community Leaders
Foundations

Potential candidates suggestions for our initial hire
Connections to best-practices (e.g. similar programs in other cities – Austin, TX)

A Passionate & Motivated Team!

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Backup Slides

June 2021

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How are Dara and Kabir doing?

Let’s check in on Dara and Kabir:

CMR:

It’s been 18 months since Kabir launched his startup and he has made great progress.

His beta devices were tested at a large biotech as part of their Phase 2 clinical trials – and the feedback was excellent.

2 large partners have even signed letters of intent to purchase production units – pending expensive and time consuming quality tests.

Kabir now has to raise $10M in a Series A venture round to:

select a contract manufacturer,

pay for inventory,

hire a sales and marketing team,

and expand his technical staff.

The problem is … there are NO venture capital firms in the area. So he is forced to go travel to Silicon Valley, New York and … Cambridge to try and raise the money.

Fortunately several VCs are interested, but at a $10M investment level …

they want the be on the Board,
They want the company “nearby”
And they want to plug the company into their network of high-tech talent, legal and professional services, advisors and innovation teams

Kabir feels that he can attract the talent (though he knows that he has to overcome a lot of prejudices about Lowell when he talks with candidates), and thinks he can get the services he needs in Lowell, but knows that it is a “tough sell” to the VCs.

And he really needs the capital to grow his company.

LK:

Dara’s journey is similar …..

An agent brings her to a variety of spaces within Lowell, but none of them feel right, and she’s concerned her suburban customer base wont’ drive into downtown or will struggle with parking

Recruited employees

Hired payroll company, attorney

Began exploring financing options and ended up (which she didn’t realize is super rare) qualified for credit union approved her for an SBA loan

It turned out a Board Member of EforAll worked there and based on her business plan, and the fact she’d been a customer there for years (2 as a business)

Needed to decide where to lease a space…

Both Dara and Kabir have difficult decisions to make ….

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Why are Dara & Kabir so passionate? And why should we care?

Desire to be difference-maker, make an meaningful impact and fulfill their potential

Inspiration to build something that will improve (a small part) of the world

Have the freedom and flexibility �to follow their dreams

Build and attract a team of like �minded individuals

Give back to their communities

Creates Local Jobs

Increasing the tax base
Downstream businesses receive many multiples of investment

Grows the Local Economy

Locally Made Products and Services
Greater economic diversity

Community Identity

Environmental Benefits

CMR: Why are they so passionate? And why should we care?

<CLICK>

CMR: Interestingly, money isn’t the sole – or even most important motivation for the either of them. Go through bullets

Desire to be difference-maker, make an meaningful impact and fulfill their potential
Inspiration to build something that will improve (a small part) of the world
Have the freedom and flexibility to follow their dreams
Build and attract a team of like minded individuals
Give back to their communities

<CLICK>

LK: And the communities that they chose to grow their businesses in truly do benefit.

Creates Local Jobs

Increasing the tax base
Downstream businesses receive many multiples of investment
In fact 64 percent of new jobs creation comes from small businesses and startups/new companies - this is millions of jobs
66% of small businesses outsource services to other small businesses

Grows the Local Economy

Locally Made Products and Services
Greater economic diversity

Community Identity
Environmental Benefits

LK: Let’s check in on how Dara and Kabir are doing …

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Unmet Need – Why Dara & Kabir Left …..

Unmet Need

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Existing Site

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… And we have built & recruited the team to make it a reality!

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Entrepreneurship in the Merrimack Valley

Capital

Friends and Family
Loans
Grants
Crowdfunding
Philanthropic Funding
Angels, Venture Capital
Private Equity

Education & Incubator

Resources

UML
MCC
NECC
E for All,
iHub
M2D2

People

Employees
Mentors / Role Models
Government
Suppliers
Support (Accountants, Lawyers, Real Estate, Banks)

Customers

Local
Massachusetts
National
International

LK: … their entrepreneurial path in the Merrimack Valley

CMR: Both Dara and Kabir had to navigate the complex, daunting and often confusing ecosystem that face all entrepreneurs. First, they had to figure out how to get funding for their nascent companies. <CLICK> Go through bullets.

LK: Dara needed technical assistance and to be honest, didn’t even know she needed that or where to begin. <CLICK> Go through bullets

CMR: Another consideration for both Dara and Kabir was the access to support services and the people needed to make their business vision a reality <CLICK> Go through bullets

LK: … and perhaps most importantly. Dara and Kabir needed to know they had prospective customers and market demand <CLICK> Go through bullets

CMR: Undaunted by the challenges and roadblocks, Kabir was able to

Secure a $250K seed financing from an Angel group and the UMass Lowell River Hawk Fund
He was able to obtain affordable, flexible co-working and lab space at M2D2
Given his connections at UMass Lowell, he hired two recent engineering graduates and one intern
He was even able to secure a small loan of $50K from the LDFC to purchase specialty equipment (using the equipment itself as collateral)
And he got his business off the ground

LK: Similarly, Dara pushed made great early progress as well ….

Learned about EforAll at BBQ
Applied, got in, mentorship, & won prize $$
Mentors challenged her focus on value pricing for her services and find her best customer that would pay the most
Connected services, talked with the Economic Development office in Lowell,
Needed more capital
Needed to find space

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Budget and Next Steps: $200K can make an enormous difference

	Activity	Budget	KPIs
Phase 1: 2H 2021	Develop and Launch the MVP 1.0 and engage community via outreach efforts	Management: Volunteer Office Space: Donated Web Dev, Web Marketing, Hosting, Dedicated Community Outreach, Translation $125K Dedicated Community Outreach and Guiding Resource $75K	On time On budget SEO target TDB SEM target TBD Applications improvement of TBD Awards improvement of TBD
Phase 2: 2022	Dedicated resource to support, refine and measure MVP 1.0 and continue community outreach Refine to MVP 2.0 Create Lowell/ MV VC entity Begin raising funds (gov’t and private investor alike)	Management: Volunteer Office Space: Donated Web Dev, Web Marketing, Hosting, Community Outreach. Translation $125K Dedicated resources (fund raiser, community outreach) $250K	TBD
Phase 3: In 2024	Establish “Grow in Merrimack Valley VC Fund 1” at $50M. Make first investment. Fold MVP 3.0 into VC site	Funded entirely through limited partners	TBD

Phase 1 MVP Goal is to demonstrate increased entrepreneurship in Lowell with the existing (but limited) capital sources

Phase 2 goal is to grow throughout MV and begin to obtain /deploy new capital sources

Phase 3 goal is make the Merrimack Valley a premier innovation hub through a dedicated VC Fund