The Commission for Economic Development in Orem wants to build a 50,000-square-foot incubator.
Although that may seem a bit large for growing chicks, it would be just the right size for 20 to 30 growing businesses, a commission official says.The Orem City Council on Tuesday agreed to send a preliminary application for project funding to the federal Economic Development Administration. The agency reviewed Orem's early plans and invited the city to apply for a grant.
Daryl Berlin, city manager, said those who are invited to apply have a very good chance of getting funding. If the preliminary application leads to a request for a formal application, Orem could receive as much as $500,000 upon approval.
"The purpose of the business incubator would be to take new businesses from an idea to a salable product," said DeLance Squire, director of the economic development commission. The incubator would nurture new businesses by providing central support services at low cost, he added.
"We would have office space with a central receptionist, copying equipment, computers and telephone equipment," Squire said. "There would be a board room for when the companies were ready to bring in investors for a presentation."
The normal mortality rate for such new businesses is 50 percent, Squire said. Businesses in incubators around the country have a much lower failure rate - about 10 percent.
Squire said some local lawyers, bankers and others have offered free "start-up" services to businesses in the incubator. Several corporations and private individuals have pledged project support of as much as $4,000 each, and one-third of the facility's land cost will be donated by the site owner, Squire said. If the federal grant comes through, the economic development commission would like to build a facility costing about $1.1 million.
"We will know in 30 days if we get the grant, then we will prepare a full-blown application," Squire said. "If everything fell into place perfectly - which is unlikely - I think we could break ground this fall and have the building occupied by the first of the year."