By Ilan Mochari
One year ago, Somerville Scout published a feature called “Building a Business Friendly City.” In response, Somerville’s Office of Strategic Planning and Community Development (OSPCD) has taken several steps to attract and retain growth businesses. We’ll detail those initiatives – and some other cool commercial developments – in this story.
And on our blog – the front page of somervillescout.com – you’ll soon find an online series of small biz posts including:
Watching the Wheels. Why bike-makers Independent Fabrication (IF, 86 Joy St) and Dutch Bicycle Company (DBC, 161 Broadway) keep turning heads.
These Cupcakes Also Kick Ass. An inside look at the two nonprofits the OSPCD has targeted as prospective Fab Labs.
An Inconvenient Truth. Why are there so many convenience stores on Highland Ave? And is one of them breaking Massachusetts laws by selling cigarettes for below state-mandated minimums?
Cambridge vs. Somerville. How has business gone for the owners of Twinkle Star (7 Upland Road, Cambridge) since their move from Ball Square last November? How has membership grown for Village Fitness (313 Highland Ave) since its move from Cambridge last July?
Good Times, Bad Times. Is development in Assembly Square all that it could be?
All told, there are 1,486 businesses in Somerville. Tempted as we were to try, we couldn’t share all 1,486 stories. But we tried to find the most interesting ones.
Should I Stay or Should I Go?
For nine months, Second Wind (366 Summer St) searched in vain for new manufacturing headquarters in Somerville. The 62-employee company, founded in 1980, has been in Davis Sq ever since it moved out of cofounder Walter Sass’s bedroom. Both Sass and cofounder Kenneth Cohn, friends since their grade-school days, still work there.
But Second Wind’s 15,000 square foot manufacturing space on Dane St could no longer accommodate its breakneck growth on the heels of its wildly successful Triton Sonic Wind Profiler, which holds nearly 65 percent of the market share for remote sensing equipment related to wind technology.
Asked if Second Wind had initially searched for a new manufacturing locale in Somerville, General Manager Susan Giordano replied, “Oh my gosh, did we ever. We looked everywhere.”
In fact, Second Wind found an enticing spot in the Innerbelt Area with “lovely views of downtown” and more than enough room (20,000 square feet) to accommodate the company’s projected growth. But the company chose a similar-sized site in Newton because of price: $11 per square foot vs. the $16 per square foot they’d have had to pay in Somerville. Also, they only had to sign a three-year lease in Newton, giving them flexibility to depart if they outgrow the space. And they might: Second Wind projects that it will add 75 employees to the Newton facility – where 15 already work – in the next three years.
Gone for Good
The September exodus of Second Wind and the February departure of 150 jobs at Ames Safety Envelope (12 Tyler St) beg a larger question: Is scale manufacturing gone for good? The numbers plainly indicate it is going. In 2001, there were 2,038 manufacturing jobs in Somerville. In 2009, there were 1,155. That last figure does not reflect the 2010 losses of Second Wind and Ames.
But Somerville is not without its manufacturing presences. Rogers Foam Corporation (20 Vernon St) employs more than 500 people worldwide. Tracer Technologies (20 Assembly Square Dr) employs about 100 people. On a smaller scale, a handful of niche players remain rooted in town. Prominent among them because of its consumer-branding is Taza Chocolate (561 Windsor St), founded in 2006. There are also several older companies whose products are less well known to the average resident. Peter Forg Manufacturing (50 Park St) has been around since 1881. Vice President David Forg, the fifth generation of Forg to helm the company, says, “We plan on staying here. I love Somerville. I enjoy the wide range of people – it’s a young, vibrant, great community. And we have guys who have worked here for 35 years who grew up a block away, and their fathers worked here too. It’s neat to have that history.”
Peter Forg Manufacturing, which employs 20, specializes in custom metal stampings – washers, banks, slugs, discs, diaphragms. As it happens, their customer base includes Tracer Technologies and Second Wind. Has the recession hit Forg? Absolutely. But he says it’s no worse than it was during the early 90s. “Things have been slow, but we’ve added a few new customers, so it’s kept us up to pace where our sales haven’t dropped that much.”
Forg’s business typifies the sort of manufacturer still in the city, says Stephen Mackey, President of the Somerville Chamber of Commerce. He cites comparable specialists, including Central Steel (99 Foley St), Bomas Machine Specialists (334 Washington St) and Mystic Valley Foundry (14 Horace St). While Somerville’s heyday as a manufacturing town – think 19th century brick-making or 20th century auto-making – may be gone, there remain the niche players. “You had a history of larger manufacturers, and what it’s transitioning to now are smaller highly specialized manufacturers,” says Mackey.
Another of these specialists is Tony LaFuente’s Flagraphics (30 Allston St). The 12-employee company makes flags and banners. For LaFuente, the advantage of locating in Somerville continues to be, simply, Somerville’s location. “We do work locally and throughout the state and New England. So being close to Route 2, the expressway, 93 North and the airport – this is better than anywhere else in greater Boston for me.” LaFuente’s business is not just making the flags and banners, but installing and servicing them. So loading trucks and reaching clients quickly is crucial.
The transition from scale to specialists “is certainly a trend we’ve seen nationwide,” says Alan Tonelson, a fellow at the United States Business and Industry Council, an association of small manufacturers. “I think the main question it raises for policy makers and for all Americans, really, is does this trend have the potential to produce for the nation and its economy the kind of benefits that the current manufacturing base – which is under such stress – has historically provided?”
Measuring a Year
One year ago, the Scout reported that the OSPCD had no relationship with MIT’s Sloan School of Management, even though Sloan is a hotbed for the high-tech manufacturers and entrepreneurs who could ostensibly locate growth businesses in Somerville. The Sloan alums who founded 3Play Media recently moved from their Somerville base of 27 Ellington Road – a converted apartment – to 1972 Massachusetts Ave in Cambridge. The two locales are a half-mile apart. But the distance crosses city lines.
One step the OSPCD took in response to the Scout’s story was to task Anne Emig, a masters student at MIT’s Department of Urban Studies and Planning, with researching how the city could attract and retain high-tech start-ups. When her written report – not yet complete at press time – is finalized, the OSPCD will post it online and “develop a series of recommendations on how to follow up through new zoning that incentivizes or rewards business startups,” says Rob May, Director of Economic Development. Those are not the only measures the city is taking:
1. Proposing legislation that would streamline permitting processes for business owners. Among other things, this legislation would separate the need for a review by the planning board before items go to the zoning board. So the legislation would, essentially, eliminate the need for applicants to attend an extra meeting.
2. Reaching out to realtors. Since July, Cushman & Wakefield (C&W), a global powerhouse in commercial real estate, has been trying to fill the roughly 230,000 square feet available at the former Ames location. C&W senior director Trey Agnew, who is in charge of other properties too, says May frequently calls him with leads on companies who are looking to expand. Agnew has peddled properties in Chelsea, Medford, Charleston and Revere, and he says that Somerville “stands at the top of the heap” in terms of ease-of-interaction with city hall.
3. Completing a study of the inspectional services division regarding how to speed up – and make more customer-friendly – the building permit process through software. The software would allow applicants to track permits and enter key data online, reducing in-person meetings and minimizing the back-and-forth aspect of the process.
4. Zoning legislation that would create a new category of historic carriage houses. Under the rubric of this new category, these houses could serve as offices for home-based businesses.
5. Exploring the possibility of a Fab Lab in Somerville, perhaps at Sprout (339R Summer St) or Artisan’s Asylum (561 Windsor St, 13 Joy St). The OSPCD believes a Fab Lab could parlay the city’s more enduring resources – its population of artists and academics, techies and nerds – into an entrepreneurial community with manufacturing potential.
A Fab Lab (Fabrication Laboratory), to paraphrase the Wikipedia definition, is a small-scale workshop with an array of computer-controlled tools, with the aim to make products generally perceived as limited to mass production. Fab Labs, in other words, allow inventors and engineers to use pricey or overlarge equipment to which they might not otherwise have access.
All the parties involved in the Fab Lab effort sound strong notes of caution. “Everything is totally preliminary and no major plans have been made,” says Gui Cavalcanti, who cofounded Artisan’s Asylum with his fiancée, Jenn Martinez. Sprout cofounder Alec Resnick is a strong believer in the teaching component of Fab Labs – in providing access not only to equipment, but also to people who know how to use the equipment. “Getting people access to tools and human resources is a really strong starting point for trying to seed business opportunities,” he says.
Through the Roof
Two other companies in “Building a Business-Friendly City” went through dramatically different courses. 2N + 1 (35 McGrath Highway) – a data storage business whose owners, Vincent Bono and Will Locandro, made our cover – took a turn for the worse. In response to a Scout email asking “How business has been, in the last year,” Bono replied, “LOL. We filed for Chapter 11 Bankruptcy reorganization because business has been so horrible.”
It’s been a better business year for Mark Sullivan, founder and co-owner of Voter Activation Network (VAN, 48 Grove St), a software maker whose product helps Democrats run their campaigns. When we last checked in with Sullivan, he was anticipating that his then 40-employee firm would grow to 60 Boston-based employees in the next 12 months.
It did. That was the good news. The bad news was that his Davis Sq space was running out of room. “It was upsetting because we really like the neighborhood,” he says. “A lot of our employees have chosen to live here. We were looking in Kendall Sq and in Boston and nobody was excited about making that change. We felt we were going to lose the community we like and live in.”
Sullivan approached his landlord about taking over the first floor in the building, directly under VAN’s then second-floor office. The landlord agreed to cut a hole in the floor and put in a staircase – and VAN stayed. Sullivan admits that having the two floors has led to a slight sense of division, if only because the programmers are all on the first floor and the second-floor denizens simply don’t see them as often as they used to. But in his view, it beats the alternative of moving out. And he now has enough space to grow to 100 employees. “We think we’re good here through the 2012 election,” he says.
Zipcar, the car-sharing company cofounded in 2000 by Sloan graduate Robin Chase, is not such a young business anymore. But the $170-million car-sharing industry “is still in its embryonic stages on a global basis,” says Neil Abrams, owner of Abrams CarSharing Advisors in New York City. Abrams’ chief car-sharing consultant, Julian Espiritu, is a former Zipcar executive.
Not long ago, Abrams and Espiritu met with the founders of iCar (68 Prospect St), a Somerville-based car-sharing startup. “They saw the potential in the Boston-metro market and came to us to teach them the business,” says Abrams. He is speaking of Pat Walsh and Dan Cogan, who run U-Save Auto Rental (70 Prospect St). Their wives, Nancy Walsh and Jippy Kheel, are the proper owners of iCar, while Pat Walsh and Cogan serve as general managers. Walsh and Cogan are not the only auto-rental veterans looking to branch into car-sharing. According to Abrams, Hertz and Enterprise have also entered the space. Interestingly, iCar’s female ownership gives it a historical congruency with Zipcar, which was also owned in its early stages by a female pair: Chase and cofounder Antje Danielson.
How is iCar doing? It’s too early to tell. The business only launched in June with a 25-car fleet. Six of its cars are parked in Somerville, including two locations which went live in September: one at the end of Elmwood Street along the Bike Path and one in Porter Square in the lot off of Elm Street near the Shopping Center.
Why would a consumer choose iCar over Zipcar? Jennifer Jones, iCar’s Business Development and Marketing Manager – and currently its only employee – makes compelling arguments. To cite but one: Unless a Zipcar member has the iPhone app, he has to make a phone call in order to (a) pick up the car early, if he arrives well before his reservation (b) notify Zipcar he is going to be late.
Dan Curtin, General Manager of Zipcar’s Boston office, denied part (a) in an email: “Members are welcome to grab their Zipcars 10-15 minutes prior to the start of their reservation, no call necessary. It’s actually one of the first features built into our system over 10 years ago.” Curtin did not acknowledge part (b) in his email reply.
Not that iCar has it out for Zipcar. If anything, says Jones, iCar believes there’s more than enough room for both companies in the market. And as someone who does all of the speaking on behalf of iCar, she is grateful that “Zipcar did a lot of the groundwork in terms of explaining what car-sharing is,” she says. “So that takes the explanation out of our marketing equation.”