Post Falls entrepreneur turns University of Idaho project into company worth millions

Wednesday, 09 November 2022 / Published in News + Updates

This article first appeared in Journal of Business on September 8, 2022 by Kevin Blocker.

What began as a college project among three classmates at the University of Idaho in 2016 has turned into a company with annual revenue now in the millions.

Tim Ledford, the 28-year-old CEO of Post Falls-based SafeGuard Equipment Inc., is a main driver behind the company’s meteoric rise. SafeGuard now has its utility worker, hardhat clip-on device—named Compass—in 58 countries.

“We have gotten our product in nearly every utility in the nation,” he claims. “But the coolest statistic is we’ve helped save more than 48 lives now.”

The device, which is no bigger than the size of a human hand, has the ability to detect and notify a utility worker of unseen, nearby sources of electrical charges, preventing potential electrocution, he says.

“SafeGuard is one of the fastest-growing startups in the Pacific Northwest, in the 96th percentile (on PitchBook) for growth rate compared to startups across the U.S.,” says Cyndi Donahue, community engagement director of Ignite Northwest, in Ledford’s Rising Stars nomination letter.

In addition to SafeGuard, Donahue notes Ledford is an adviser and mentor to several local startups, including Quantum Star Technology, and a founding member of Inland Northwest Private Equity Group. He also previously sat on Rep. Cathy McMorris Rodgers’ subcommittee, WA-05 Tech & Innovation Coalition.

Ledford co-founded the company with Brandon Bledsoe and John Thompson, who remain among SafeGuard’s co-owners. The trio launched its product in August 2018, and the company was profitable by October the same year. All three come from a family of electrical workers.

The Compass device first prevented an electrocution of a utility worker in the field in 2019, claims Ledford.

The U.S. Department of Labor estimates more than 200 utility worker electrocution deaths occur annually.

Ledford declines to disclose specific revenue figures but says the company is on track to reach $100 million in annual revenue in as little as five years.

Ledford’s family moved to the Inland Northwest from Seattle in 1997. He graduated from Coeur d’Alene High School before completing an undergraduate degree at University of Idaho.

He accepted a position as an industrial engineer for Boeing Co. after earning a 4.0 GPA in college. He worked on a handful of projects for the company, one of which he says helped the company save $70,000 per week in operating costs, and another saving $50,000 per week, he says.

For those efforts, he was placed in an accelerated leadership program at Boeing. At the same time, he submitted his application to Harvard to complete an MBA.

Ledford accomplished all this while working on SafeGuard with Bledsoe and Thompson, who also had secured full-time employment with other companies out of college.

“I had this crossroads moment of going on with (SafeGuard) or pursuing this incredible opportunity with Boeing,” he says.

Financial commitments from angel investors, which included Avista Foundation, Spokane Angel Alliance, and Cowles Ventures LLC, persuaded the SafeGuard triumvirate to move forward with their collegiate project, Ledford says.

Safeguard currently is operating in 15,000 square feet of space in a series of offices in the Tedder Business Center, at 4454 W. Riverbend, in Post Falls. Ledford says the company has 30 employees and expects to add 10 more by the end of this year.

He says he’s not completely surprised at where the company stands today.

“There were a lot of unknowns when we first started,” he says. “But we had the vision, and we had the skillset.”

Entrepreneurial ecosystem in greater Spokane traverses complicated terrain

Thursday, 21 April 2022 / Published in News + Updates

This article first appeared in the Journal of Business on April 21, 20211. by Virginia Thomas

While funding opportunities have slowed in the wake of the COVID-19 pandemic, Spokane’s startup community remains active, bolstered by employees located throughout the U.S. and events that bring attention to new companies, some market observers here say.

According to information from proprietary market data software subscription platform PitchBook, more than $51.6 million went to startups in the Spokane area in 2021. That’s less than half the $107.6 million in funding startups here received in 2020.

Of those funds committed in 2021, nearly half—$25.3 million—was venture funding.

Steve Rector, chief investment officer at Spokane-based Cowles Ventures LLC, says that while there’s no shortage of startups to fund, cash flow to investments has slowed as investors have been more hesitant to part with their money while the pandemic persisted through a second year.

“People are preserving cash in some of the uncertainty,” Rector says. “I was a little more protective during the last 18 to 24 months, just until we got a better handle on where things were going.”

Cowles Ventures is the venture-capital arm of Cowles Co., which owns the Journal of Business through its subsidiary, Northwest Business Press Inc.

Tom Simpson, managing member of angel fund Kick-Start, president of the Spokane Angel Alliance, and president and CEO of Ignite Northwest, says that data from Pitchbook should be taken with a grain of salt.

“PitchBook data is not complete because you don’t have everything disclosed,” Simpson says. “I would be careful about drawing a meaningful conclusion and saying the Spokane region suddenly is less interesting because of a decline.”

According to PitchBook data, startups that received the greatest amount of funds in 2021 include:

•Coeur d’Alene-based additive manufacturer Continuous Composites Inc., which received $18 million in venture funding in June.

•Coeur d’Alene-based cyber security company Gravwell Inc., which raised about $7 million total from two seed funding rounds in 2021.

•Spokane Valley-based real estate startup Doorsey Inc., which raised $4.1 million in seed funding in November.

Simpson says it’s important to note the number of new startups receiving investments versus the number of follow-on investments.

In 2021, four new startups – Vega Cloud Inc., Doorsey Inc., Treasury4 Inc., and Ruumr Inc. – received funding. No new startups received funding in 2020, according to PitchBook data.

Rector says Cowles Ventures invested in two new companies in 2021—Spokane-based fintech software startup Treasury4 Inc. and Vega Cloud, which is a Liberty Lake-based software maker.

So far in 2022, investors have infused more than $7.7 million into local startups, according to PitchBook. Most of that came from a $7 million venture funding round to Spokane-based spice maker Spiceology Inc. from San Francisco-based venture capital firm Jackson Square Ventures and other undisclosed investors.

Rector says investments in Spokane-area startups are likely to recover somewhat in 2022.

“Overall, in the markets and the venture space, we’ll probably see some upticks in ’22, just because we are getting out of some of the uncertainties that were clouding us in 2020 and 2021,” Rector says.

Simpson says future successful companies could be born from local startup events, which also maintain the momentum of the community.

Sparks Weekend, to be hosted this year by Ignite and LimeLyte Technology Group Inc. from April 29 to May 1 at the Catalyst Building, at 601 E. Riverside, provides new startups with resources to launch, Simpson says.

“It’s a three-day event where people with ideas for brand-new businesses present their ideas on Friday evening,” Simpson says.

About 40 presenters will be winnowed down to 10 finalists, who will be paired with mentors to work on creating a minimum viable product, conducting market research, and refining their busines model. On Sunday, competitors will present their final plans to a panel of judges. One winner will receive $50,000 in investment capital.

“That’s something that’s been very fruitful in the ecosystem here in Spokane,” Simpson says. “For example, Spiceology was the winner of a predecessor to Sparks Weekend, which was called Startup Spokane. Kaspien, several years ago, was the product of the same business plan competition.”

Spokane Valley-based e-commerce company Kaspien Holdings Inc. is an example of a company that has benefitted from some effects of the COVID-19 pandemic, Simpson says. It has increased employee numbers by hiring people to work remotely. Other startups in the Spokane area also are likely to grow this way, Simpson says.

“The broader acceptance of remote work has really helped Spokane,” Simpson says. “In the past, sometimes Spokane was at a disadvantage for recruiting. Now, we can recruit people to work for emerging Spokane companies, though the workers may live elsewhere. It’s benefitting the entrepreneurial ecosystem in Spokane in two ways—more talent coming in, and the ability to attract a broader base of talent, though the workers might not live in Spokane.”

Ryan Arnold, director of regional entrepreneurial strategy at North Idaho College and co-manager of the Northwest Entrepreneur Competition, says entrepreneurial events are a good way for startups to find funding and other resources.

At the Northwest Entrepreneur Competition, hosted virtually on April 13 by North Idaho College and Spokane’s University District, more than 50 student teams competed for a total of about $44,000 in awards.

In addition to funding and feedback from judges, such events provide networking opportunities. Arnold says many entrepreneurs have a small network or none at all.

“Events like these oftentimes are a sort of clearinghouse for that, where they’re not only competing, but they’re meeting new people, they’re meeting their own peers that are going through the same issues, and they’re building their own entrepreneurial network,” Arnold says.

The Northwest Entrepreneur Competition has been hosted by North Idaho College annually for about 15 years, Arnold says. In that time, the entrepreneurial ecosystem here has flourished, he says.

“What we’ve found over time is that Spokane as a region has gotten more complex as far as the ecosystem goes,” he says. “We’re doing a good job of cooperating across state lines. The ecosystem is starting to work together a lot better, more cooperatively.”

Even before the Northwest Entrepreneur Competition came along, the startup community here was connecting higher education institutions with startup investment opportunities.

“You see this in the building growth of Spokane’s University District, for instance—the physical form of these spaces and places next to the downtown core,” Arnold says. “We were trying to attract talent and resources. But now, that talent and resource is here. Those buildings and spaces are here. With that comes the opportunity to just keep building and growing.”

Arnold says startups in the health sciences, aerospace, and advanced manufacturing sectors in particular have seen significant growth here.

Rector says Spokane startups have been receiving more attention from investors based outside of the Inland Northwest.

“We’re attracting some good, strong attention nationally with some of the companies that were started here,” Rector says. “I’ve got a couple of different venture groups in the Bay Area and a couple in the Seattle area that are much more inquisitive as to what we’re doing over here.”

Life sciences startups in Eastern Washington find a welcoming ecosystem away from big cities

Thursday, 23 September 2021 / Published in News + Updates

This article first appeared in GeekWire on September 18 2021. Article by

The biotech and healthtech community in Eastern Washington has a loyal base of startups that laud their local connections and the support of a tight-knit group of entrepreneurs.

That’s a message echoed by several of the region’s CEOs and founders recently at the East West Life Science Summit, a meeting sponsored by industry group Life Science Washington.

“We have long-standing relationships and community built in this region that allows innovators to advance ideas and network and connect in a way that you just don’t get in more urbanized areas,” said Georgina Lynch, co-founder of Appiture Biotechnologies, which is developing ways to diagnose autism by measuring light reflexes in the eye. She is also an assistant professor at Washington State University Elson S. Floyd College of Medicine in Spokane.

Appiture is one of several startups in the region fostered by WSU’s tech transfer office — though not all WSU spinouts stay.

Well before its public offering last year, WSU neurosciences spinout Athira Pharma made the move to the Seattle area, as has Cancer Targeted Technology, which is developing diagnostics and therapeutics for prostate cancer and has a licensing deal with pharma giant Novartis.

But companies that stay are rewarded with a lower cost of living for their workers and a stable employee base in a region with a less hectic pace of living than larger cities, said Shade Needham at the meeting.

“Once somebody finds the right position they don’t leave, and so there’s very low turnover,” said Needham, who owns Alturas Analytics, a contract research organization that performs chemical analyses for drug companies. The company is located in Moscow, Idaho, adjacent to the Washington border.

Parrots CEO David Hojah, left, poses with a man using an AI-enhanced assistive parrot device, perched on wheelchair at right, to assist with vision. (Parrots photo)

Proximity to Seattle and the region’s recreational options are also luring an increasing number of tech companies to Spokane, such as Seattle-based pet company Rover, which has an outpost in the city.

Tech activity bolsters the larger startup ecosystem in the Spokane region, an area of about 500,000 people. Startups can tap into institutions such as Greater Spokane Incorporated, a business development organization, Startup Spokane, and the Health Sciences and Services Authority of Spokane County, a Washington state-funded group that issues grants to the life and health sciences research industry.

Last December, WSU launched a Spokane-based incubator for early stage life sciences companies. Spinout Space in Spokane (sp³nw) provides lab and office space for startups including H Source, a marketplace for hospitals to buy and sell medical products from each other, and clinical genetic testing company Allele Diagnostics.

Startups have also been buoyed by early stage funders in the region such as entrepreneur Tom Simpson, who sold his e-commerce company Etailz for $75 million in 2016. He has backed dozens of Spokane-area startups as CEO of Ignite Funds and president of the Spokane Angel Alliance.

Spokane entrepreneur and angel investor Tom Simpson. (Ignite Northwest Photo)

Since 1921, Spokane has been home to a company now called Jubilant HollisterStier that is manufacturing components for COVID-19 vaccines. The contract research organization is a subsidiary of global company Jubilant Pharma.

Eastern Washington has the talent pool and early-stage funding opportunities to support more life sciences growth, said meeting attendees.

“You can get very well connected here very quickly,” said Parrots CEO and founder David Hojah. Hojah received funding from Simpson and other backers to launch his eight-employee startup developing assistive technologies for people with multiple sclerosis and other conditions. Parrots also recently won second place at a Novartis-sponsored competition for its tech device to support vision, which looks like a parrot.

Hojah previously lived in Boston and recently moved to Spokane from Seattle. So far, his impression is positive: “It’s the connection, the people, the vibes and the energy.”

Several other Spokane-area companies were highlighted by speakers at the summit.

  • Swabbing a dog for a genetic test. (Paw Prints Photo)

    Paw Print Genetics services dog breeders and veterinarians with nearly 300 genetic tests for over 350 different dog breeds. Founder and CEO Lisa Shaffer received an undergraduate degree from WSU and returned years later as a genetics professor. She co-founded Signature Genomic Laboratories, a Spokane-based genetic testing company for children with developmental disabilities that sold for $90 million in 2010. Paw Print, founded in 2012, had 40 employees in 2020 and was growing.

  • Medcurity makes it easier for healthcare organizations to comply with federal privacy and security laws through an online series of queries resembling Turbotax. Last summer the startup raised $500,000 from Seattle’s SeaChange fund, on the heels of $737,00 from Washington Research Foundation.
  • Photon Biosciences leverages its technology for ultra-sensitive imaging of biological materials and is developing an at-home test for contamination of blood platelet donations. The WSU spinout has landed grants from the U.S. National Institutes of Health totaling $415,000, matched locally by the Health Sciences and Services Authority of Spokane. CEO Chandima Bandaranayaka previously rose from research intern to business development manager at VMRD, a 40-year-old Pullman-based diagnostics company.
  • S2 Media manufactures and sells materials for culturing microbes. In 2019 the company secured $750,000 in funding from “local investors” to expand production in its 5,000-square-foot operation. The company was founded in 2015 by microbiologist Stephanie Bernards, who has a master’s degree from Eastern Washington University and is a former quality assurance manager at Jubilant HollisterStier.
  • Crimson Medical Solutions is led by co-founder Stephen Bone, who graduated from WSU in 2020 with a bachelor’s degree in bioengineering. Crimson is making an organization system for IV lines to reduce medical errors. The three-employee, three-intern company has received grant funding from Greater Spokane Incorporated.

Spokane-based Spiceology raises $4.7 million in Series A funding

Thursday, 01 October 2020 / Published in News + Updates
This article first appeared in The Spokesman Review on Friday September 25, 2020. Written by Amy Edelen. 

Spokane-based Spiceology has secured a $4.7 million round of Series A funding, led by grocery and retail executive Ty Bennett with participation by Kickstart Funds III and IV, a group of angel investors and the Cowles Co., which publishes The Spokesman-Review.

“I have been an investor in Spiceology since the early days and had the privilege of watching the company elevate above the thousands of small spice purveyors in the market,” Ty Bennett, founder and former CEO of Jacent, said in a statement. “I look forward to bringing my retail and grocery experience to the table to help Spiceology continue to delight customers and find new ways of meeting customers where they shop.”

The privately held spice company will use the funding to bring process automation to its SpiceLab operations, and advance its sales and marketing efforts. The SpiceLab is where spice blends are formulated and packaged with the company’s trademarked “periodic table of flavor” labels, according to a company release.

Series A funding is the first round of investment funding after seed funding. It typically involves venture capital firms and is for startups that have established growth.

Spiceology, founded in 2013, was recently named to Inc. Magazine’s list of the 5,000 fastest-growing companies in the nation. It ranked 1,081 on the list with a three-year revenue growth of 423%.

The company has steadily grown its operations by creating recipes and how-to videos for customers as well as collaborating with chefs and food influencers on new product lines.

At the onset of the coronavirus pandemic, Spiceology experienced an uptick in spice sales as more people began preparing meals at home.

Bennett has joined Spiceology’s board of directors. The company also hired Roger Landrum as senior vice president of global supply chain and operations, the release said.

Landrum was formerly the senior director of supply chain, risk management and procurement at Litehouse Foods, a Sandpoint-based $300 million salad dressing and herb manufacturer.

“Spiceology’s formula is focusing on quality and innovation at scale. By doing so, we’re bringing life into a very tired category that’s sorely in need of a fresh alternative,” Chip Overstreet, president and CEO of Spiceology, said in a statement.

“There’s nothing more core to our lives than eating, and we bring smiles to people’s faces when they realize how much better every meal can be with a simple sprinkle of Spiceology goodness.”

Colville’s cross laminated timber manufacturer will help put region on CLT map

Monday, 14 September 2020 / Published in News + Updates

This article originally appeared on KXLY.com by Derek Deis

COLVILLE, Wash. — Buildings made with cross laminated timber are already commonplace in Europe, but it’s a relatively new concept here. So to say Russ Vaagen, whose family has owned Vaagen Brothers Lumber for more than 70 years, is excited about his new venture would be an understatement.

“We could put this as the mass timber capital of North America eventually,” said Vaagen, the CEO and founder of Vaagen Timbers.

Cross laminated timber is an eco-friendly, wood panel product made from gluing layers of lumber together. Vaagen says it’s kind of like a Lego set.

“We’re actually putting together a kit that a builder can do very rapidly, high quality and goes together the same way every time,” explained Vaagen. “And so, it’s going to speed construction time up, it’s going to provide a much higher quality build, we’re going to be much more energy efficient.”

Vaagen Timbers can build its CLT panels up to 60 feet wide with varying depths. And Vaagen says it’s one-fifth the weight of steel and concrete with the same structural strength.

“So we’ll have a lighter, more nimble building. It’ll also be much better equipped to handle seismic shifts.”

And Vaagen says it can be used for all sorts of applications, including, “Mid-rise structures for commercial buildings, apartments and even homes.”

CLT panels start with pieces of lumber on the finger jointer machine.

“We take knives and we make a set of fingers. And they do just as it says, they joint together. And then we use pressure and an adhesive to tie those together,” said Vaagen.

After the wood is planed, it goes to the layup line, where Vaagen says those pieces of lumber get turned into panels.

“So we take four feet of wood, we lift it up all together, put it on the conveyor, goes and gets a layer of glue.”

A set of vacuums then lifts and places each additional layer.

“Sets it on top of that glued layer 90 degrees to the other layer, comes back through the glue, gets another long layer set back on it.”

The now heat cured panels then get cut by giant saws on the CNC line.

“We’re cleaning the cuts, we’re making the connections to go panel to panel if we’re doing a wall or a floor system,” said Vaagen.

After sanding, they’re ready to be shipped to customers.

One of the first places you’ll be able to see Vaagen Timbers’ CLT put to use is in Spokane’s Perry District, where Blockhouse – Life is building a 14 unit modular structure using CLT.”

“So we’ll make boxes basically that can be repeatable, but they can be customized,” said Vaagen. “And it’s modular. So ultimately, you could pick it up and move it and put it someplace else.”

Vaagen says Spokane, and Washington as a whole, are poised to be leaders in CLT and mass timber products. And that has him excited about Vaagen Timbers’ potential for growth.

“There’s just no losers. Everybody wins. And we’re going to be offering incredible structures for people to build with for years to come.”

Ghost Kitchens: Restaurants for the pandemic era

Tuesday, 25 August 2020 / Published in News + Updates

This article first appeared in the Spokane Journal of Business on August 13 2020. Written by Virginia Thomas.

An emerging restaurant model known as “ghost kitchens” is gaining popularity in some parts of the U.S. and could find a foothold in Spokane, industry experts say.

The concept appears to be becoming more appealing as COVID-19 pandemic-related restrictions continue to batter the restaurant industry.

Ghost kitchens refer to restaurants that operate exclusively on a takeout-and-delivery model, without in-house dining. There are three types: commissary kitchens, pop-up kitchens, and pods, according to digital food-tech publication The Spoon. Commissary kitchens are shared kitchen spaces owned and operated by a third party. Popups are areas within the main kitchen of a restaurant that are dedicated to fulfilling pickup and delivery orders and typically have a distinct menu and branding from that of the established restaurant. Pod kitchens operate within shipping containers and can be placed nearly anywhere.

Adam Hegsted, owner of the Liberty Lake-based Eat Good Group LLC., says the company had planned to open a ghost kitchen space in Spokane Valley, but it’s holding off until the area’s economy stabilizes.

Hegsted says Eat Good’s partner, GVD Commercial Properties Inc., bought the former liquor store building at 5004 E. Sprague earlier this year. Hegsted planned for four companies to share the space: Incrediburger & Eggs, Taco Suave, Doughlicious Bakery, and either a fried chicken or healthy food restaurant.

Hegsted has experience dabbling in the ghost kitchen model. Eat Good Group’s cafe, located in the Meadowwood Technology Campus, in Liberty Lake, also produced orders for Incrediburger Express, a takeout- and delivery-only version of Hegsted’s hamburger restaurant. That has been suspended temporarily, partly due to the impacts of the pandemic, Hegsted says.

“The idea works great, as long as you can get enough delivery orders,” Hegsted says. “There’s a lot of savings as far as the buildout. And same with labor. You don’t have to have as many front-of-the-house people doing customer service and helping guests. You just have a cook back there to create the food, and someone getting orders ready, taking orders, and cashing people out.”

Adam Stinn, director of business solutions at Rosemont, Illinois-based national foodservice distributor US Foods Inc., says the idea was catching on in some U.S. cities before the pandemic struck, but it’s become an important way for entrepreneurs to launch their food businesses, as well as a way for existing sit-down restaurants to add another revenue stream to compensate for lost revenue due to COVID-19-related occupancy restrictions.

“We have seen growing popularity and growing interest across all segments around ghost kitchens,” says Stinn, whose company operates the Food Services of America warehouse in Spokane. “I’ve seen some numbers saying that in the next 10 years, this could be a trillion-dollar industry. There’s definitely a lot of growth potential.”

Ryan Wilcockson, owner of Spokane Salad Delivery LLC, says he chose to use a ghost kitchen model to start his salad delivery business in order to keep overhead low. Wilcockson, the sole employee of Spokane Salad Delivery, works out of the Kitchen Spokane commissary space in the Northtown Mall.

“They have all the supplies we need, all the fridge space, freezer space, and dry (ingredient) space,” Wilcockson says. “It saves a lot, and I can afford to buy fancier products for the customers.”

Kitchen Spokane is a nonprofit that offers commissary kitchens as incubators for small food businesses. Jayme Cozzetto, director of Kitchen Spokane, launched the first commissary kitchen under the Kitchen Spokane name in 2014. Since then, it’s grown to include two locations in Spokane, two in Coeur’ d’Alene, one in Ponderay, Idaho, and another in Vancouver, Washington. Most of its commissary kitchens are in malls.

Donita Humrich, kitchen manager for Kitchen Spokane, says malls are a good fit for commissary kitchens because the infrastructure already exists, and clients can access the space at all hours. Also, mall security keeps the space safe, and the mall itself is responsible for maintenance. With many malls struggling to fill spaces, it’s a partnership that works for everyone, she says.

In the early days of the pandemic’s presence in the U.S., Kitchen Spokane’s revenue dropped by about 30%, Cozzetto says. Around late April, that changed.

“We started to see something we did not expect: a rise and growth in the industry,” he says.

In the past few months, nine new businesses have signed up to use Kitchen Spokane’s spaces. That brings the total number of businesses operating through Kitchen Spokane’s locations to nearly 90.

Cozzetto says the organization is continuing to expand, with two new spaces in the Spokane Valley mall and one in Coeur d’Alene’s Silverlake Mall expected to be established within the next two months. He claims that the COVID-19 pandemic has brought rental rates for commercial spaces, especially those located in malls, down significantly.

Kitchen Spokane charges clients $15 an hour to use its space and equipment, with dry and refrigerated storage space offered at a starting rate of $3 a day.

Cozzetto says many new clients had planned to launch elsewhere but have found their options severely limited by the pandemic.

“We’re seeing people who maybe had an idea before that they were going to do, and they were going to (sell at) farmer’s markets and public festivals,” Cozzetto says. “What I’m seeing is that instead, they’re focusing their efforts online. They’re selling everything online, and they’re doing remarkably well.”

Stinn says that when Washington restaurants were forced to close their dining rooms in March, many eateries grappled with switching to takeout- and delivery-only models.

“While there was definitely revenue and continued sales there, it was clearly not what restaurants are used to, and there’s also additional costs that come with those delivery and carryout mechanisms,” Stinn says.

Some restaurants have embraced the ghost kitchen model, either by starting a second ghost kitchen restaurant that has a separate menu within their existing kitchen, or by adding a “digital franchise,” Stinn says.

In the digital franchise option, for example, a local restaurant that makes its own Mexican-inspired food could add revenue by partnering with a national pizza franchise, enabling the franchise to use part of its kitchen to produce pizzas for delivery.

“I think the most attractive thing about the model is if there’s consumer demand for a certain menu type, a lot of operators already know their fixed costs, whether it be a lease, cost of utilities, those kinds of things,” he says.

The ghost kitchen model enables restaurant operators to continue to have a sales channel, even if it means providing a different menu altogether, Stinn says, adding that it can be done with relatively low startup costs.

“You’re not starting an entirely new brick-and-mortar location,” he says. “You’re really just expanding a menu, which can be done with relatively low risk.”

However, launching an unconventional restaurant through a ghost kitchen comes with its challenges. Chief among them, Hegsted says, is brand recognition.

“If you don’t have an established name, it’s difficult to get the marketing out there, because you don’t have a physical space for people to connect with,” he says.

Spokane Salad Delivery’s Wilcockson says the technological aspects of running a delivery-only business have created an unforeseen obstacle.

“Not everyone is tech-savvy, so unfortunately for people who aren’t used to it, using the internet or their cell phone makes it complicated,” Wilcockson says.

Vying for time in the kitchen also can be challenging, he says. If another Kitchen Spokane client reserves the space for the time Wilcockson had intended to use it, he’s in a tight spot.

Despite these hurdles, Wilcockson says he believes the ghost kitchen model will stick around.

“Not only in Spokane, but nationwide, worldwide. With the whole COVID situation, it’s kind of going to have to go that way,” he says. “I think it’s going to be the way of the future, at least for a couple of years.”

Midtown Drive Up Deli owner Mikele Williams visits with employee Lori Nirk’s daughter, Amanda Flom, before opening for the day. Midtown is in the southeast corner of the My Favorite Things parking lot on Seltice Way in Post Falls. Photo credit: Devin Weeks

Hegsted likens opening a take-out or delivery restaurant through a ghost kitchen to launching a restaurant in an unpopular neighborhood.

 

“In the beginning, it may be a little more difficult to get people to latch onto the idea of coming to that neighborhood,” he says. “It’s the same with people figuring out the idea that it’s delivery only. But once you get that clientele and build that loyalty, people are willing to get food delivered that they know is going to be good quality.”

Spokane company leads with virtual solution to teach children with autism

Monday, 13 July 2020 / Published in News + Updates

Long before the era of COVID-19, Laura Kasbar was a Spokane mother who merely wanted to find a way to address her children’s autism.

Almost by chance, she noticed that video lessons would help, particularly with a child who doctors had declared would never speak.

Nine years later, in 2011, her son Max was mainstreamed, and her Gemiini Systems, still based in Spokane, has become a worldwide leader in online distance learning for people with autism, Down syndrome, dyslexia, speech delay, stroke and other issues.

Since the novel coronavirus outbreak, Gemiini has seen “an avalanche” of interest as families and school districts seek virtual solutions to real-life challenges of learning from home, Kasbar said from her home in Southern California.

The company, with about 50 employees, is run by her son Nicholas out of the Holley- Mason Building in downtown Spokane. After an initial adjustment, Gemiini has adapted to a surge in business.

Gemiini has opened its certification program to professionals and has waived the $490 fee for certification.

Gemiini is also offering schools and clinics the use of its system at no cost as long as they agree to submit the cost of the program to Medicaid.

Gemiini has proven to be a valuable solution for special education administrators, who are struggling to navigate this crisis to continue to meet the needs of special needs students and families.

For many children, “this can be the only link to therapy,” Kasbar said. “And now with COVID everyone is on that boat.

“Our team has been able to get to work immediately. Our subscription base has increased dramatically.”

Gemiini – the unique spelling is Kasbar’s tribute to her autistic twins, Max and Anastasia – was the product of Kasbar’s yearslong search for a solution.

Nicholas Kasbar is ready for a busy day at Gemiini Educational Systems located in the Holley-Mason Building in downtown Spokane. Gemiini Educational Systems, which Kasbar co-founded with his mother Laura, is a video-focused system to teach autistic children. Business is booming for Gemiini since the COVID-19 pandemic sent students home for school.

It was in 2001 that Kasbar recalled walking into a room in her Spokane home, saw all six of her children lined up in front of the television and “couldn’t really tell which were the autistic ones.”

At that time, conventional wisdom dictated the television should be turned off if autistic children were nearby. But that experience told Kasbar video was the answer.

She and her husband Brian had noticed that young Max wouldn’t make eye contact with them but would interact with the television.

“I thought, ‘I’ve got to get my mouth on the TV,’ ” Kasbar said.

That night, they made one-minute videos of a cup and Barney, the TV dinosaur.

“It was a close-up of my mouth saying the word ‘Barney’ next to the actual Barney and then saying the word ‘cup’ next to a cup. We did three sets in a row,” Kasbar said.

That night, after watching several times from his highchair while eating, Max made his biggest breakthrough.

Kasbar held up a cup and he said “cup,” his first word – 3 years and 8 months of age.

During the next decade, and with the help of her oldest son, Nicolas – who also had been on the autism spectrum – Kasbar developed the video program.

In 2012, thanks to funding from the Spokane Angel Alliance and Inland Imaging, Gemiini was launched.

Backed by studies from four universities, Gemiini serves 30,000 clients in 40 countries.

Its use of discrete video modeling, which presents only a specific piece of audio information, was showed by a Portland State University study to be 300% more effective than standard video modeling.

Kasbar was so inspired by the success of her program that she shared her experiences in a book, “Embracing the Battle: Secrets of Victory from a Warrior Mom.”

Closer to home, Gemiini has worked with former NFL star and Spokane native Mark Rypien to develop an application to address suicide prevention.

The goal, Rypien said last fall, is to connect circles of friends of persons at risk so they can better monitor their state of mind.

Lately, the main focus has been reaching children who have been isolated by COVID-19.

“It’s been pretty easy,” said Nicolas, who runs the Spokane headquarters. “After a few headaches, we’ve been able to keep going and helping people, and we’ve updated a lot of our instructions on Facebook Live to walk people through how our lessons work.”

Jim Allen can be reached at (509) 459-5437 or by email at [email protected].

Opportunity Zones encourage investments in low-income urban and rural communities

Friday, 17 January 2020 / Published in News + Updates

Opportunity Zones are a community development program established by Congress in 2017 to encourage long-term investments in low-income urban and rural communities. Private investment vehicles that place 90% or more of their funds into an Opportunity Zone can earn tax relief on the capital gains generated through those investments. Tax benefits increase the longer investments are in place.

An Opportunity Zone is a community nominated by the state and certified by the Treasury Department as qualifying for this program. See which communities are certified by looking at this interactive map.

For specific information on Opportunity Zones in Idaho, click here.

For specific information on Opportunity Zones in Washington, click here.

Colfax Nanotechnology Startup Poised to Receive $1.5M Grant from US Air Force

Wednesday, 15 January 2020 / Published in News + Updates

Colfax-based Nanotechnology Company Challenged By U.S. Air Force to Raise $1.5 Million to Help Crowdfund Military Research

COLFAX – A local Colfax based tribology company is set to receive a $1.5 million dollar grant from the U.S. Air Force, if it can raise the matching funds in time.

TriboTEX technology has won numerous awards, and obtained funding from a variety of institutions, including the National Science Foundation, the Department of Energy, and NASA.

To date, the company has sold over 36,000 units worldwide. They have a range of products suitable for the smallest lawn mower engines to the largest semi truck engines.

TriboTEX applied for a Small Business Innovation Research program through AFWERX, in order to obtain access to the defense market. AFWERX is a United States Air Force program with the goal of fostering a culture of innovation within the service. Encompassing a number of programs supported with relatively small amounts of funding, the initiative is intended to circumvent bureaucracy and engage new entrepreneurs in Air Force programs.

The U.S. Air Force has challenged the TriboTEX team to raise up to $1.5 million for matched funding, which is necessary to scale the business operation and produce more products for military testing. TriboTEX is working with AFWERX to test TriboTEX products in military equipment. The TriboTEX team plans to raise the money necessary to fulfill their grant requirements through crowdfunding, by launching a Kickstarter campaign that went live today, for the company’s latest nanotechnology product, “TriboTEX Transmission.”

TriboTEX Transmission uses the familiar two-sided nanoparticles specifically designed for automatic transmissions. The nanoparticles reduce friction, which prevent accelerated wear, lower temperature and noise, and extend the life of the transmission. Transmissions with TriboTEX will last longer, potentially saving thousands in expensive repairs.

Currently, the Department of Defense spends millions of taxpayer dollars in maintenance costs. TriboTEX is aiming to save Americans millions by preserving equipment used by the military. “Helicopter gear boxes are limited in flight time, and longevity is critical for safety of the flight,” stressed CTO Rudenko, who says the product will work for anyone who wants to improve the functionality of their transmission, whether its a 2002 Toyota Prius or a Sikorsky UH-60 Black Hawk helicopter.

Washington Commerce introduces “Thrive!” to help high-growth businesses expand

Tuesday, 17 December 2019 / Published in News + Updates

First appeared on Washington Department of Commerce website on Dec. 17, 2019.

OLYMPIA, WA – Expanding on the success of its original economic gardening program, the Washington Department of Commerce has developed Thrive!, a new program to help second-stage companies increase revenues and position for growth.

Based on the Edward Lowe Foundation’s System for Integrated Growth (SiG) framework, Thrive! connects chief executive officers to subject matter experts who provide them with data, analytics, best practices and strategies that are typically only available to larger corporations. This actionable information can be used to overcome roadblocks related to human resources, finances, operations, marketing, sales, international trade and other business issues.

“Since its introduction three years ago, Commerce’s second-stage program has helped 39 businesses across the state find innovative ways to increase growth and revenue,” said Lisa Brown, Commerce director. “Where the original program focused solely on external issues, Thrive! examines internal and external roadblocks to growth, since one can often affect the other.”

Research shows that historically, companies that have completed a second-stage program like Thrive! experience a 15% to 30% increase in revenue.

The ideal candidate for Thrive! is a company that’s been in operation in Washington for at least two years, has between six and 99 employees, achieved $1 to $25 million in annual revenue and has demonstrated an appetite and aptitude to handle additional growth.

To help offset the $4,275 cost of the program, Commerce contributes $1,275 to pay for the initial needs assessment call with the team leader as well as a strengths-weaknesses-opportunities-threats (SWOT) analysis call with a team of experts assigned to address identified business issues. Based on these calls and the resulting work plan, the CEO can move into the research phase of Thrive!, which entails up to 33 hours of professional research time. Thrive! is conducted entirely by phone and a secure online portal created especially for each participating company. Thrive! requires approximately eight to 12 hours of the CEO’s time over the course of four to eight weeks.

More information about Thrive! as well as a link to the application for the program is available at https://startup.choosewashingtonstate.com/programs/thrive/. Contact Susan Nielsen at [email protected] for eastern Washington Thrive! opportunities.