AdvantageWest gets $1.2 million for ScaleUp WNC

FLETCHER – With 14,000 gallons produced this year, Noble Cider is not the same company it was two years ago when the market’s big thirst for their small batch of 2,000 gallons caused the barrels to run dry before the next apple season.

“That’s when we had our first realization that we needed to make a lot more because we can’t just stop selling. We have to continue to have something to sell in order to still be a business,” said Trevor Baker, co-founder of Noble Cider. “Running out just isn’t an option anymore.”

In less than two years, the local hard cider company has grown its production by 700 percent, increased its contracts from 5 to 75 and is in the process of opening a 9,000-square foot facility in the former Carpet Connection building in West Asheville.

The startup phase is over.

However, a new opportunity to help Western North Carolina businesses like Noble Cider to grow has just begun.

AdvantageWest, the nonprofit economic development partnership for the state’s 23 westernmost counties, was recently awarded a five-year, $1.2 million contract to develop ScaleUp WNC.

The initiative will provide intensive growth strategy development and implementation assistance to 150 local, high-growth entrepreneurs — a resource that Matt Raker, vice president of entrepreneurship at AdvantageWest, said the region sorely needs.

“There’s a whole other set of really important challenges and barriers to overcome for those companies that want to grow up and scale up, Raker said. “We saw a real lack of existing resources that really focused on that.”

AdvantageWest is one of eight entities in the nation selected by the U.S. Small Business Administration for this contract, and the local partnership also will be serving the most rural entrepreneurial ecosystem in the batch.

“Businesses in rural areas may not have the readily available resources to help them scale as compared to their counterparts in urban areas. If resources are available, they are often dispersed,” SBA Director of Clusters and Skills Initiative John Spears said via email. “One of the goals of ScaleUp is to convene key players (service providers, lenders, mentors, etc.) in each communities’ economic development network in a way that these growth-oriented small businesses can fully leverage them.”

The other communities chosen for the SBA’s ScaleUp America contract include Tuscon, Arizona; Jacksonville, Florida’s Metropolitan Statistical Area; Kansas City; Aurora, Illinois; Central Ohio; Roanoke, Virginia; and Greater Portland, Maine.

Led by AdvantageWest with help from the Sequuoyah Fund, Ascent Business Network, and Asheville-Buncombe Technical College’s Entrepreneurial Development Foundation, ScaleUp WNC will offer two, eight-week training sessions a year with 15 participants in each session.

According to an informal survey with key partners, Raker said AdvantageWest quickly identified more than 500 businesses that will fit the criteria for ScaleUp WNC even though the program plans to serve a total of only 150 businesses during the five-year period at this time.

“It will be highly competitive,” Raker said of the merit-based application process for ScaleUp WNC, which opens for its first round of 15 entrepreneurs Monday. “This won’t meet the need out there, but it will be a big step in a much-needed program.”

Eligible businesses must be based in WNC, have annual revenues of $150,000 to $500,000, have at least one full-time employee and have identified opportunities for business expansion.

However, even when these entrepreneurs know where they want their business to grow, learning how to make it happen is another matter entirely.

When Jesse Lee co-founded Outrider USA, a Fletcher-based company that makes ultralight adventure vehicles, with his friends Tommy Ausherman and Dan Rhyne in 2009, it was a three-man operation.

Three years later, they moved the company to Fletcher. However, since their successful Kickstarter campaign to build an all-terrain electric bike for people of all disabilities in 2014, the company has seen a 700 percent growth in sales and added five people to the team.

With no formal background in business, though, learning how to grow the business has been harder than riding or even building a bike.

“I think in a lot of ways the skills that you need to employ as a lean startup and a lean entrepreneur is sort of like pulling back on a rubber band, where you’re taking on more and more roles as you pull back the band and continue to grow as a company. At the time, all of those skills are pretty much self-management, and then the rubber band snaps,” Lee said. “The business either fails or it flings in the other direction and your skillset has to do a complete 180.”

Steve Poland, a venture growth adviser at A-B Tech and one of the three ScaleUp WNC instructors, said this is why education is the core component of the program.

“For entrepreneurs that are in the revenue range of $150,000 to $500,000, a lot of times they get there by the sheer doing and launching of their business. They get a product out or a service out, they get customers and it starts working,” Poland said. “They’ll start out as an expert in whatever business they’re in and then find they have to add all of these other skills of building and growing a business that isn’t part of their expertise and that they didn’t encounter during the startup phase.”

Companies chosen for the program will first meet one-on-one with a mentor to assess growth opportunities for their business. Poland said this can include growing a customer base, creating a new product line, entering new markets, adding employees and increasing production capacity.

Baker, who said he would like to see Noble Cider eventually expand into other markets, said sometimes just knowing where to start can be intimidating.

“In order to grow, you know you’ve got to do A, B, C, and D, but maybe D is what you should do first,” he said. “You have to re-figure everything out, and it’s a little overwhelming at times. It’s kind of like you never left the startup phase.”

When it comes to financing, Poland said it can feel a little bit like déjà vu for companies. ScaleUp WNC provides businesses with up to $1,000 in seed money for entrepreneurs to use toward developing their growth plan, whether it’s building a prototype or investing in new systems.

“A lot of them do need to raise money,” he said. “They’ve figured out how to get started, but they may not be investor-ready or they may not be lender-ready.”

ScaleUp WNC culminates with a pitch event, where businesses will share their story and plans for growth. Even for companies who may not be in need of equity, Poland said the event still serves an important purpose for high-growth entrepreneurs.

“Part of the reason why we keep that ultimate goal in there is to help provide them with the motivation to really work on a conclusion,” he said. “It can be really difficult for entrepreneurs to step back and see the big picture and think about what they need to achieve their goal.”

Lee and Baker said they plan to apply for the ScaleUp WNC program.

Thinking back to Outrider USA’s grand-opening event in an empty warehouse with one of their vehicles sitting on a table, Lee said the company has come a long way. However, he does not want the journey to end anytime soon.

“I can relate to it feeling like some sort of strange impossible task. I think it’s all about baby steps. You have to do what is right for the company at the time and place that you are,” Lee said. “The constant learning is so important if you want to stick around. Everything is changing so quickly within our industry and in the business landscape in general. But we’re still hungry, and I’m not too proud to ask for help.”

As Baker prepares get Noble Cider’s new space and taproom ready, he said getting the education and assistance from ScaleUp WNC could give his business the right tools to not only succeed, but to succeed in a smart, sustainable way.

“In the period of growth we’re in right now, sometimes I feel like we do a lot of things on the fly because we have to. Then, there will come a time when we have a good running machine and we will have to figure out what our next moves are,” he said. “You can go in with a plan, but as your business grows and changes, sometimes it doesn’t make sense to stick with it.”