INCubator upgrades eyed as ‘game-changer’ for Chattanooga’s entrepreneurial ecosystem

Photography by Matt Hamilton / Nick Johnson of One Off Robotics at the INCubator inside the Hamilton County Business Development Center.
Photography by Matt Hamilton / Nick Johnson of One Off Robotics at the INCubator inside the Hamilton County Business Development Center.

Redeveloping and expanding the Hamilton County Business Development Center is seen as a potential game-changer for economic development in the region, according to a new report.

The small business facility, known as the INCubator, is already one of the largest in the country and had a projected $73.4 million economic impact in 2022 -- and officials and others believe even more is possible.

"It's a bit of a unicorn from an economic development standpoint," says Charles Wood, the Chattanooga Area Chamber of Commerce's chief executive.

Studying options to boost the INCubator is one of a handful of key initiatives identified in the Chamber's updated five-year growth plan, dubbed "Chattanooga Climbs Higher," which will start next year.

Wooing more air service to Chattanooga Airport, charging up the area's Gig City profile, and building out 10 career pathways while working with local collaborative Chattanooga 2.0 are among the potential game-changers in the plan, along with creating what the report calls "a first-in-class incubation facility."

In its entirity, the INCubator offers start-up companies 127,000 square feet of support. First raised for manufacturing in the late 1920s, the site housed industrial giant 3M in the 1950s until it was transitioned to Hamilton County in the mid 1980s.

Local economic development leaders transformed the facility into Hamilton County's first business incubator, helping plant the seeds of Chattanooga's entrepreneurial ecosystem.

The INCubator typically includes about 50 startup businesses at any one time, officials say. It offers manufacturing and office space, shared administrative services, training workshops, a conference center and access to free on-site counseling from the Tennessee Small Business Development Center. Businesses usually "graduate" and leave the facility within about three years.

"It's making sure entrepreneurs are ready," Wood says.

The Chamber's plan calls for partnering with Hamilton County to study options and potentially reinvest in the center. Tax-increment funding could be explored to support the center's expansion and redevelopment, the plan says.

Wood says County Mayor Weston Wamp has an entrepreneurial background, and he sees the redevelopment of the facility as possibly transformational.

The BDC sits on about 2.5 acres and includes some parking. But Wood says the 90-year-old structure has been "pretty cut up" over the years and there are physical challenges within the building itself.

Also, redevelopment could significantly enhance technology within the building, he says.

"It's using 1990s technology," Wood says. "It would allow for some improvements and upgrades."

  photo  Photography by Jennifer McNally / Meeting room

 Nick Johnson, chief executive and founder of INCubator client One Off Robotics, which offers a range of customizable robotic fabrication systems for additive and subtractive manufacturing, says the facility is "one of the best gems in Chattanooga for creating jobs."

But Johnson, who says his company expects to graduate from the BDC next year, says the facility could use more resources to help businesses involved in technology.

"I'd love to see technology have a bigger role," says the CEO of the company that now has about a dozen employees.

Wood says one option likely not to be considered will be shifting the facility to another location, even though North Shore real estate is valuable.

"Re-creating that facility would be hard to do," Wood says, adding the INCubator sits amid an urban environment many entrepreneurs like.

As the report on the Chattanooga Climbs Higher strategy mentions exploring tax-increment funding, or a TIF, Wood says that could mean a development partner or simply government using a TIF as a tool.

He says he'd like to see officials move "reasonably quickly" on the potential upgrades to the BDC. Wood says an aim is to keep entrepreneurs in the Chattanooga area.

As officials consider actions related to the BDC and the long-range growth strategy, they continue to enhance the structure such as adding an outdoor seating area and indoor space where clients can interact.

The report also calls for creating a strategic partnership with VentureSouth, one of the largest angel investment groups in the United States, to increase funding for early-stage startups.

In addition, the report identifies working with Tennessee legislators and the University of Tennessee at Chattanooga to expand research and development activities in Chattanooga.

Wood emphasizes that education is "front and center," highlighting their concerted efforts to align with Hamilton County Schools. He also points to Mayor Wamp's desire to invest in a new public school downtown to further vocational and technical education.


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