September 3, 1997

A SMALL-BIZ HOTHOUSE IN MISSISSIPPI

Edited by Dennis Berman

When Charles Doty came to the Jackson Enterprise Center in 1990, he had little more than a dream of building his own company. Doty, who grew up on a farm in the Mississippi Delta, knew he wanted to build his own manufacturing company ever since he started spending summers working in a Chicago robotics plant. He wasn't sure what he would manufacture -- just that it would have something to do with electronics.

The Jackson Enterprise Center, a small business incubator in Jackson, Miss., welcomes dreamers like Doty, who founded Lextron Corp. there. The center is a joint venture of public and private interests funded largely by Irby Construction in Jackson and run by the Mississippi Economic & Community Development Dept. (for more information, see BW Enterprise, 9/1/97, "When Bureaucrats are a Boon"). Designed to nurse new businesses to health so they'll create jobs, the center offers entrepreneurs space and shared services like phones and copiers, for nominal fees. The Jackson State University Small Business Development Center also works out of the incubator, lending help to entrepreneurs who need start-up necessities like business plans and financing proposals.

Doty says the incubator was especially important during his company's early days. He was able to lease just 400 square feet -- at well-below market rates. And if he needed more room, the center would quickly make it available. The incubator helped him cut costs, too. Doty was spared the expense of buying new office equipment like fax machines and copiers.

The business experts at the center led Doty to other government-backed programs that also saved him money. One state-backed project, for example, paid part of his employees' salaries for the week he spent training them. In that instance, Hinds Community College screened applicants for his jobs, then sent them to Doty to be trained at the job site. "Sometimes the employer has a particular skill that he needs to teach himself," explains John Woods, industrial training coordinator at the college. "The state has an interest in the companies training these employees."

For nearly three years, Doty worked with advisers at the incubator on fine-tuning his business plan and preparing for work. He says the networking at the incubator during this period, both with its advisers and fellow entrepreneurs, was invaluable. Advisers at the center helped him make contact with bankers well in advance of Lextron's first job. Later, these bankers would quickly provide the operating capital he needed when his company landed its first contract. Other struggling entrepreneurs working through the incubator gave him leads on possible jobs. Whatever the situation, be it applying for financing, bidding a job, or hiring workers, he says, "there was always someone around who had been there."

Lextron got jump-started, in March, 1993, when it landed its first contract. It quickly hired seven workers to start making electronic wire harnesses used in voice and data cables for BellSouth Corp. -- a job that quickly established Lextron as a competent telecommunications-parts manufacturer. "I thank God for BellSouth being there to let us show what we could do," he says.

Today, Lextron is a commercial tenant at the Enterprise Center (it pays higher rent). It uses 20,000 square feet of space there, building electronic wire harnesses and surge protectors for BellSouth and Lucent Technologies. In December, Lextron opened a second plant to build auto parts for Delphi Packard. Altogether, the company now employs 72 workers.

Understandably, Doty is now a fervent advocate of government programs that support start-up businesses. He offers these tips to entrepreneurs who plan on using one of the programs:

--Be very specific about what you plan to do when talking to officials. "The more well-defined [your business plan] is, the more readily you can be pointed in the right direction for help. Sometimes people may not understand exactly what you need."

--Take advantage of the thoughts of people familiar with entrepreneurship. Doty says he found it particularly helpful to discuss his plans with the experts that ran the Enterprise Center. "Sometimes you just need to have a good coach around. Sometimes you just need somebody to listen."

--If the help you need is financial, start seeking it long before you think you'll require it. That way you won't have to start from scratch when you land a big job and need money for supplies to do it.

--Be prepared to accept some delays. Part of the frustration for entrepreneurs is that agencies sometimes work slowly. Develop a certain level of patience, saving your battles for occasions when timeliness really is an important issue. (Like when you really have to have the capital now -- or you'll lose the contract.)

By Dee Gill in Jackson, Miss.