'Economic gardening' to cultivate job growth

Michael Spinosa overflows with enthusiasm about the team that helped his Columbia company figure out new strategies for growth — at no charge.

That might not sound like economic development, if your conception of it is multimillion-dollar incentives to tempt big employers to move in. The assistance Spinosa got is a different approach with the same goal: more jobs.


Connecting established local companies to expert help — pioneered as "economic gardening" in Littleton, Colo. — is catching on across the country. Maryland dipped its toe in the waters last year with a pilot.

It's now officially launching its own program, Advance Maryland, as a grow-from-within strategy.


"It's basically taking the companies that are planted here and fertilizing them," said Stacey N. Harvey-Reid, a state Department of Business and Economic Development official who is helping run the program.

Spinosa, CEO of Web and hosting firm Unleashed Technologies, was one of six participants last year. He came away with market-research data and a clear idea of which customer segment to target next.

"We had such a great success with it — I would highly recommend it," said Spinosa, who expects to add about 10 people to his 27-employee company this year. "What we really needed the help with was understanding our competitive marketplace and, on top of that, a way to better engage with our clients. The economic gardening really delivered on both of those things."

The Economic Alliance of Greater Baltimore, a nonprofit economic development group, approached the state economic development agency about trying the concept in Maryland. Each organization funded half the $30,000 cost last year. They've doubled their contributions this year to increase the number of participating companies to an even dozen.

Almost all of Maryland's job growth in the last 15 years has come from businesses already in the state or new ones starting up here, said Tom Sadowski, CEO of the economic alliance. Maryland already had programs aimed at startups, so the two groups agreed to work together on "second-stage" companies — ones past the startup phase "that show the most promise for growth, if only for a bit of help," he said.

"It's basically a more strategic and targeted form of business assistance," Sadowski said. "It's definitely a wave of the future for economic development."

Jessica Nelson, general manager of the National Center for Economic Gardening, said 27 areas — a mix of states, cities, counties and regions — are using the concept.

The center, hosted by the Michigan-based Edward Lowe Foundation, is working with Maryland on its program.


Nationally, she said, about 10 percent of businesses qualify as second-stage, "but they create upwards of 35 percent of the jobs." It makes bottom-line sense to focus some economic-development attention there, she said.

Nelson doesn't cast economic gardening as a replacement for other programs, including efforts to bring companies in from elsewhere. She just sees no reason why old-school incentive programs — the kind aimed at landing big game — should be the only thing.

"It doesn't always have to be about hunting," she said.

Government agencies in Maryland have approved multimillion-dollar assistance deals for developments such as Baltimore's Harbor Point, but the state is not a major player in the subsidy game, according to data from Good Jobs First. The watchdog group said cash incentives, loans and other help Maryland gave to businesses since 1996 totaled less than all but 12 other states and D.C.

That makes economic gardening an easier budget line to add than, say, a $100 million package of sweeteners for relocating companies. The cost for economic gardening in Maryland: $5,000 per business, on average.

What companies get isn't consulting in the traditional sense, Nelson said. They're not told what to do. It's more of a temporary research staff — people skilled in finding data on potential new markets, customers, competitors and industry trends.


Others on the economic gardening team offer assistance with search engine optimization, social media and marketing.

Kimberly Brown, CEO of Amethyst Technologies, a 15-employee Catonsville company that provides quality assurance services to laboratories, got that help last year during Maryland's pilot program. The team identified potential clients and ways to use social media more effectively, she said.

"The program really offers small businesses access to the same information that large businesses have," she said. "That's where I see it's a tremendous opportunity."

Companies are eligible if they're based in Maryland, employ 10 to 99 people, have $1 million to $50 million in annual revenue and can demonstrate they're positioned for growth. The deadline to apply is June 27.

Harvey-Reid, program manager for the Office of Strategic Industries and Innovation at the state economic development agency, said it's too early to judge the results of the pilot program. But five of the six selected companies completed it, she said, and their positive feedback sold officials on expanding the effort.

In Kansas, which ran a pilot program several years ago, participating companies increased full-time employment 29 percent, Nelson said.

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But how much of that is directly due to economic gardening could be hard to tease out. As she noted, participating companies already had been poised for growth.

Unleashed Technologies, founded in 2007, came into Maryland's pilot program with a record of rapid expansion. It increased revenue more than sixfold between 2009 and 2012, landing on last year's Inc. 5000 list of the country's fastest-growing private companies.

But Unleashed Technologies' Spinosa said the assistance he got last year is helping the company grow more strategically now. He's zeroed in on membership-driven nonprofit groups as a fruitful customer base.

And then there was the price, which was right. He'd love to get another round of economic gardening this year.

"It was a really nice advisory board that you didn't have to buy," he said.