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Innovation Depot: Building in Birmingham

Larry Lilley and a couple of buddies had an idea for an IT company in 1996. What they didn’t have was money or space. 

One of the young entrepreneurs offered the living room of his Birmingham apartment and the bootstrapping trio went to work.

One of their first decisions as a company was to apply to an incubator program called the Entrepreneurial Center run by the University of Alabama at Birmingham. Their nascent company, Computer Technology Solutions, was accepted. The men packed up and moved into the incubator, where they stayed for eight years. During their incubation, the center merged with another local program, changed its name to Innovation Depot and moved into new space in downtown Birmingham. The prolonged incubation period provided the ramp-up time they needed, Lilly believes. When they did venture out into the business world, they were positioned to succeed.

Now ringing up $27 million a year in sales and employing over 250, the CTS chief looks back at the company’s lengthy incubation period with a mix of nostalgia and appreciation. When business is slow to develop, “You start asking yourself, ‘Is this thing really going to happen?’” he notes.

“The energy of being in an incubator, as we were, and seeing other companies being successful, encouraged everybody to celebrate success together. We’d be working at all hours and letting off steam at all hours, playing ping pong games and holding bowling tournaments. The incubator provided the sense of community you just can’t put a value on.”

Casual conversations with fellow entrepreneurs offer incubator tenants insight into such processes as hiring, real estate decision-making and intellectual property protection, said Lilly. More structured classes, lectures and workshops organized by the incubator’s staff or visiting consultants provided further knowledge.

Innovation Depot graduates like CTS account for over $250 million a year in economic impact, says Devon Laney, CEO of the high-tech/biotech business incubator, which occupies 140,000 square feet on two downtown blocks. About four-fifths of the space is leased out as dry lab, wet lab, private office and conference space, reports Laney. Offices that can accommodate three desks rent out for $400 a month. Ninety-three companies are enrolled, employing about 540 people.

“Our goal is to help entrepreneurs eliminate the fatal mistakes” that start-ups are prone to, explains Laney. “The real benefits come from the connecting and the relationships formed. It’s the people you meet who help you move your business to the next level.”


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