BEVERLY — In 2008, when the economy plunged into recession, North Shore InnoVentures launched a business technology incubator to stimulate growth in the emerging life sciences and clean technology sectors.
It was a risky move. Biotech and clean energy firms require big dollars and brain capital. Banks are reluctant to lend money to start-ups without a proven track record of sales. With biotech incubators popping up in Boston and Cambridge, competition was intense to lure enterprising scientists and engineers.
But leaders of the North Shore Technology Council, which created the nonprofit incubator, thought the region had more to lose if it did not try to catch the Bay State’s tech wave.
“We had to be proactive,” said Martha Farmer, a founder and chief executive of InnoVentures, located at the Cummings Center in Beverly. “We didn’t have any idea how well we’d do. We thought if we created 50 local jobs, we’d be quite successful.”
The incubator has taken more than baby steps. A total of 23 early-stage companies so far have been nurtured in its spacious office and laboratory space. Entrepreneurs are researching drugs to cure cancer, developing medical devices to calm nerve tremors, and testing energy conservation measures.
In the last two years, nine firms have raised a total of $25 million in private equity, mostly through individual investors, venture capital firms, or government and private grants.
A total of 115 jobs have been created across the companies, Farmer said. “That’s pretty good for our little operation.”
The progress comes as life sciences looms larger on the regional employment horizon. The North Shore Workforce Investment Board is surveying local firms to determine what skills are required to land a job in the promising field.
“It’s an industry that’s a mystery to many people,” said Mary Sarris, executive director of the workforce board. “We’re trying to determine if there are any issues, in terms of training and skills, that we should address, so that we can help people break into the field.”
Sarris worked with North Shore InnoVentures to find consultants qualified to conduct the survey. So far, 12 companies have been interviewed. Scientists and engineers, positions which often require advanced degrees, are most in demand. But there are some lab jobs available for people with associate’s degrees, she added.
“It really depends on the type of work the company is doing,” she said. “It will be interesting to find out the results.”
Farmer said the incubator is glad to collaborate with the employment board.
“Our success is measured by the jobs we create, the successful companies we graduate, and the funding these companies raise,” she said.
In the last year, two clean-tech companies raised more than $13 million in equity financing. 7AC Technologies, the first company to move into the incubator in 2008, raised $5 million, while Arctic Sand Technologies raised $8 million, company executives said.
The goal at 7AC Technologies is to develop a high-efficiency air-conditioning system that reduces energy consumption by 50 to 70 percent. The system, now in the testing phase, should hit the market in mid-2013.
Half of the equity raised this year came from 3M, the industrial giant whose glue is used in 7AC’s design.
“They came over to see what we were working on,” Peter Vandermeulen, the company founder and chief executive officer, said of 3M. “They said, ‘This is really interesting.’ They made a first investment.”
Vandermeulen said 3M will invest another $2.5 million in January. With 16employees, 7AC recently moved from Cummings Park in Woburn to the Cummings Center in Beverly, where it will be closer to the incubator.
“We’re getting a much bigger space,” Vandermeulen said. “A lot of our engineers live on the North Shore. It makes sense to move there.”
Arctic Sand Technologies of Cambridge makes microchips that convert power inside laptops, cellphones, and other equipment and has raised $8 million. The firm, started at MIT, operated at North Shore InnoVentures for five months after winning a cash prize from the US Department of Energy to lease incubator space.
“We needed a place to showcase our technology,” said Nadia Shalaby, a founder and the chief executive officer of Arctic Sand. “We needed a reception area, a conference room to set up our electronics equipment lab to [demonstrate] the technology to customers.”
The incubator operates on a $500,000 annual budget, funded by a mix of state and federal grants, corporate sponsors, and a $2,000 monthly fee for members. There are currently 16 members, and three more are expected to join in early 2013. Continued...