Incubation, not hibernation.

The 2001 Census provided Northerners with a stark reminder of the economic and population decline in their communities. At the same time, the region has witnessed an increase in the number of small businesses and start-up companies that are helping diversify and strengthen our economy. In fact, while we all aspire to attract the mega-company with hundreds of well-paid jobs, the reality is that small businesses have, and continue to, create most of the jobs.

Some of this growth has been the result of vastly improved telecommunications infrastructure that has allowed our region to overcome its isolation and geographical barriers, while increasing global competition has created business opportunities for young entrepreneurs. This emerging sector, however, has its own challenges to overcome.

Business literature and empirical evidence shows the great majority of start-ups fail within five years of operation. Those that do survive and grow have to continuously manage their growth and remain innovative in their product and service delivery. Many small companies have chosen, or have been forced, to cut overhead costs to survive. One of the ways this has been accomplished is through the home-based business. It has worked well for many entrepreneurs and it continues to be preferred by those who need to juggle family and work.

But while home-based businesses have their advantages they also have their limitations. They do not offer a professional image; there is lack of participation in marketing opportunities and there are fewer opportunities for transition to a full office environment. In most cases what seems to be missing are the support systems that help such small businesses survive and prosper into the next stage. Business incubators have been one answer to this challenging question. The following profile will help highlight successful strategies and a winning model that is creating exciting opportunities for many start-up companies right here in northwestern Ontario.

The Augesco Business Incubator opened its doors less than six months ago. It is already near capacity, with new small businesses opening or moving into its location in Thunder Bay's downtown North core. In fact, with many senior or more established businesses moving into the Intercity area, there has been a range of vacant commercial buildings available for many years. So what is different here? What does an early-stage business need to succeed?

According to Franco Crupi, principal of Crupi Consulting, the answers came through the success rate of those clients who were usually in close contact and asking for advice and assistance to overcome the natural barriers and hurdles that a company will experience as it grows. While support and assistance for small businesses is readily available in Thunder Bay and other Northern Ontario communities, there seems to have been an unfilled gap in the marketplace. Crupi moved in to fill the niche and the response has been outstanding.

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"Augesco" comes from the Latin, "to begin to grow." Already 10 companies have moved in. They are an eclectic bunch, ranging from public relations/marketing to graphic/web design, to multimedia and advertising, to software development, e-commerce, research and communications, and engineering resource management. With an average age of 30-35 years, these entrepreneurs are enhancing their skills and products through the solid business support and networking system the centre offers.

Only time will tell how well these companies will do through their progression to mature businesses. I can only say that a downtown core building that was almost empty is now starting to bustle with activity and excitement. How many more young and innovative entrepreneurs are ready to move out of their homes and join like-minded individuals to create a dynamic and successful example of the Northern Ontario enterprising spirit? I am looking forward to follow up on this question and will share any in future columns.

Frank Pullia is the principal of Pullia Accounting & Consulting. He can be reached at [e-mail] or at [phone]