Ted Simons: For 10 years now, the northern Arizona center for entrepreneurship and technology has helped create jobs in the high tech industry by linking businesses with human and capital resources, as well as with labs and networking within the high tech area. Nacet recently expanded by opening a new office at Embry Riddle Aeronautical University in Prescott. Here to talk about Nacet in general, and the expansion in particular, is Russ Yelton, president and CEO of the organization. Thanks for joining us.
Russ Yelton: Thank you, appreciate it.
Ted Simons: Give us a detailed explanation what NACET does.
Russ Yelton: It's a high tech incubation, both domestically and internationally and make sure they understand the markets they're going into and have appropriate capital and workforce.
Ted Simons: Helping startups?
Russ Yelton: Yes.
Ted Simons: Transforming innovation into business, it's a good catch line.
Russ Yelton: It means we see a lot of things, some interesting and some not so interesting. We're looking for technologies that will have a major impact. One of our clients, nest energy, builds advanced wind and solar technologies that is replacing diesel generators in places like Afghanistan and Iraq and put them to market.
Ted Simons: Let's have examples of linking clients to specialty labs and equipment.
Russ Yelton: We've started a core laboratory in the incubator of higher-end equipment that companies may not be able to afford to purchase. We have a microscope that can take a penny and measure the distance between the columns on the back of the Lincoln memorial. And chip technology, access to this can be expensive and we can provide that for $65 an hour.
Ted Simons: As far as intellectual property?
Russ Yelton: Most of our companies do have intellectual properties and we help them develop the intellectual strategies and commercialization strategies for the technologies.
Ted Simons: You mentioned that earlier, capital resources.
Russ Yelton: It can be a huge barrier for companies. 2009, 2010, raised just under $50 million to push the technologies onto market.
Ted Simons: Is that improving or still a tough sell?
Russ Yelton: The term sheets are very different than they were. It's not uncommon for us to advise clients not to accept capital but we want them to retain as much capital as they can. Receiving over $22 million in funding.
Ted Simons: Is it easier because there's focus on high tech or is that a tougher sell?
Russ Yelton: It is easier because it's focused on high tech. A technology that can have an impact not only within the U.S. but internationally.
Ted Simons: Having a faculty at Embry Riddle and NAU, having these folks around, talk about the impact.
Russ Yelton: It's huge. We assist NAU and being able to have access to the labs and knowledge to link people that have business ideas to the resources at the university and have the ability to have resources and ideas created at the university and intellectual property that the businesses can license out is important.
Ted Simons: And mentors and alumni?
Russ Yelton: We have almost 50 volunteers in the mentor groups. CPAs and marketing experts and other people who donate time every month.
Ted Simons: Is it hard to get them to donate? Sometimes we hear people don't want to mentor like they should be.
Russ Yelton: We have an I.P. attorney that drives to Flagstaff two times a
month to be around our building and the startups.
Ted Simons: The impact of the partnering with high-tech firms and low-tech firms as well, talk about that.
Russ Yelton: It's important. For example, we can have firms using lab technicians and labs that need a certain level of training and may have the I.P. but we need an appropriately trained workforce. One of our partnerships is with a college that has advanced CAD simulation is done appropriately so we have the workforce for the companies.
Ted Simons: This is based around expertise and technology, correct?
Russ Yelton: Yes.
Ted Simons: Student-business incubation program. That sounds like a great idea. A lot of universities and colleges trying to do this. How are you doing it?
Russ Yelton: We have a program now, we take students, they can qualify for a $5,000 business grant. If they're accepted into the program. And then immersed for a period of 12 months. Recently we had two students at Embry that were accepted and they were in the intelligence area. They each learned five different languages and started a company that does intelligence on the internet.
Ted Simons: Interesting. Speaking of Embry Riddle, why Prescott? Why Embry Riddle?
Russ Yelton: There's a certain amount of -- interesting amount of intellectual capital.
Embry Riddle in particular. Our current facility was funded by -- requires for us to be regional in scope. Now that the program in Flagstaff is running well, it was time to expand and it was a natural progression to choose Prescott and Embry Riddle.
Ted Simons: Are you seeing things in Flagstaff and now hoping to see and perhaps seeing in Prescott, the idea of -- we were talking earlier about a brain drain going on in certain areas of the country and state, maybe even Prescott. Is this helping to alleviate that?
Russ Yelton: That's part of the goal. We take people in the area and give them the resources and support to be successful and create jobs and that's our mission. 2009, 2010, we documented 165 new jobs created by our companies and these are primarily higher tech with salaries around $75,000.
Ted Simons: And primarily these folks are sticking around town?
Russ Yelton: Yes. Be it Flagstaff or Prescott. For a lot of folks they want to be in the area and linking the things they need to grow their businesses and be successful.
Ted Simons: What are you seeing? Let's concentrate on northern and central Arizona and the Prescott and Flagstaff areas. Does it seem like the improvements in high tech, both the industry, the innovation as well, are you seeing that happening? Is it a slow groundswell? What's going on?
Russ Yelton: The last two and a half years, we've gone from nine to 34 companies in our program. We're seeing people who may have taken early retirement, who play golf for six months and get bored and want to get back into a business. And having the intellectual properties out of the universities and a well trained workforce, there's a lot of opportunity.
Ted Simons: A lot of attraction to those areas.
Russ Yelton: Absolutely.
Ted Simons: Good to have you here.
Russ Yelton: Appreciate it.