Martha Farmer: An Entrepreneur’s Entrepreneur
By Carolyn Stinson, Editor-at-Large, Citybizlist: Boston
Martha Farmer, PhD, President and CEO of North Shore InnoVentures, wouldn’t mind being considered an accidental entrepreneur. She says that she had “been one” several times over before she realized it. In fact, Dr. Farmer ran her company for years before she was comfortable calling herself CEO, let alone “entrepreneur.”
Dr. Farmer founded North Shore InnoVentures (“NSIV”) in 2008, a non-profit business incubator and accelerator in Beverly, Massachusetts, dedicated to innovation, entrepreneurship and economic development through fostering life sciences and cleantech startups. There are 22 companies now in the incubator and to date, NSIV has graduated 14 startups – eight in cleantech and six in life sciences – two of the strongest technology clusters in Massachusetts.
Q. Tell us about your background.
A. Curiously, I’ve been an entrepreneur for a long time but I didn’t recognize it. I was the third person to join an “intrapreneurial” new program at Baxter Healthcare that became a 130-person division. I loved building that division and was totally devoted to the mission to develop a blood substitute for emergency medicine. When that blew up – due to a truly tragic failed clinical trial – I joined a two-person team creating a radiopharmaceutical startup . . . which subsequently “pivoted” in response to a deteriorating market. I wasn’t the CEO – I was VP of marketing – so I didn’t see myself as the entrepreneur.
Afterward, I became an independent consultant for several years. So I was running my own business really, but I still didn’t see that as entrepreneurial. I led the North Shore Technology Council’s bioscience committee in 2006 and turned it into a special interest group with an ongoing monthly seminar series that I started up and ran for years as a volunteer. That was the source from which sprang the incubator, really.
I had been running the incubator for years before I was comfortable calling myself CEO, let alone “entrepreneur.” The fact that NSIV was a non-profit caused me to overlook the obvious. I was running programs for entrepreneurs, reading books about entrepreneurs, going to workshops for entrepreneurs to learn things I could use to help the NSIV entrepreneurs, but until about two years ago I never thought “I am an entrepreneur!” It was this silly little book of cartoons, “How do you know if you are an entrepreneur?” that caused the lightbulb to go off for me! That “aha moment” inspired a little social media recently!
Q. That contest on NSIV’s Twitter feed asked followers to complete the sentence, “You know you’re an entrepreneur if. . . .” How would you now complete that sentence?
A. We had a lot of fun with that! We had an internal contest and the winner was, “You know you are an entrepreneur if . . . your spouse calls you ‘self-unemployed.’”
I’ve given the question quite a bit of thought, myself. Anyway, my version isn’t as funny, but it’s straight out of my own experience: “You know you’re an entrepreneur if . . . you’re willing to work for almost nothing and do practically anything to ultimately build something of value that will make everything you sacrificed worthwhile.”
Q. What’s the feeling for you when a business graduates from the NSIV incubator?
A. Usually I have a sense of elation – graduates are our most important product! But there is a sense of loss too, just like when your kids graduate. We tend to stay in touch with them and blog about newsworthy things – it’s like bragging about your kids’ accomplishments only it is professionally appropriate instead of obnoxious!
Q. The NSIV portfolio is comprised of biotech and cleantech: In the startups helped by NSIV, must the two intersect in some way?
A. The fact that we work with cleantech and biotech companies is something of an historical accident, actually, but it very much reflects a strong interest in both on the part of the founding team. Inside every biologist you’re likely to find a tree-hugging environmentalist. The NSIV startups rarely sit in the intersection of biotech and cleantech but a few do and I think it is an exciting and fertile space.
We have one company doing industrial biotechnology, using bacteria to produce specialty materials from methanol that are currently derived from fossil fuels, for example. What we have at NSIV that no other cleantech incubator in New England has is a cleantech wet lab for chemistry and materials science work – the kind of lab that biotech companies almost all need. So we tend to attract cleantech companies that have a chemistry/biochemistry focus.
Q. Among all the aspects of support NSIV provides or facilitates for its startups, what is the most challenging?
A. There are two very different ways to answer that. The most challenging aspect for me is that I have to be constantly fund-raising so we can keep the doors open because the fees we charge are not enough to cover the cost of the operations – they now cover our occupancy costs but the services are really very much subsidized. Fund-raising and all its variations – writing grants (and complying with their requirements when we are lucky enough to get one), seeking sponsors (i.e., begging for money), having to always ask people to do things for us for free, and still never being able to pay staff close to what they are worth. That’s the hardest part of what I do.
The other answer is that managing effective mentoring is harder than it looks. Our program is considered to be very good in this regard but we really struggle to do it well. You wouldn’t think you’d need to teach really experienced people how to mentor . . . but you’d be wrong. We have finally had to give up on our original mentoring model – having one primary mentor who would meet with their entrepreneur for maybe an hour a week and connect the entrepreneur to NSIV services and write a mentor report each quarter. That didn’t work! Mentors don’t like to push themselves on entrepreneurs and entrepreneurs are often not keen to ask for help. So, mentoring doesn’t happen unless it is really structured.
Q. What does the new mentoring model look like?
A. We are moving to a “mentoring team” concept, with quarterly reviews of each company and a fairly consistent team of staff and volunteer advisors/mentors in the review each quarter. The entrepreneur fills out a progress report for us ahead of the meeting using an Excel tool we developed and a staff member writes up and distributes the notes from that meeting, including an accountability section showing who is committed to do what by when. It is much more hands-on by the staff and is much more effective – but more time consuming.
Some entrepreneurs are quite hard to match to mentors – for various reasons – but the team approach helps to overcome the deficiencies and in the process, the volunteer mentors learn a lot from each other. We are developing more tools for the mentors and working on a better approach to training them and to connecting them to each other so they benefit too. We hired a part-time mentoring program director who is picking up a lot of the load. But of course that increases overhead and I have to go out and fund-raise for that!
Q.Is there a typical, or optimal, point in a developing business venture at which they approach NSIV?
A. Typically companies come to us when they are one to two people, have developed a technology somewhat but still need to work on prototyping or proof of concept, have the vague outline of a business plan, and maybe have a little friends-and-family seed money, possibly a small grant.
Optimally? We would like to bring companies in that are a little further along: have enough funding to cover operations for a year, have a team of three to five people including someone with some good business experience, ideally a serial entrepreneur. We do get startups in the latter category but not many.
Q. How is the decision made that a business is ready to graduate from the incubator?
A. It is sort of a mutual decision, usually. When a company reaches a growth phase and needs more space, or when they have obtained maybe Series A funding and can afford a place of their own, or when an opportunity comes along for a strategic partnership that requires moving – those are the kinds of things we frequently see that trigger graduation.
We have a set of graduation criteria that includes six elements. We chart progress quarterly on six axes of a “radar” chart. As companies get farther along on each of these axes, we start talking about graduation.
Q. Do some companies fail to graduate?
A. Not all companies graduate. Some leave – usually because they aren’t making any progress or can’t hold a team together, and can’t raise money (often because they can’t hold a team together).
Q, Does the relationship continue after a business graduates?
A. Absolutely! We are an economic development organization, really, so we are measured by how many jobs we create – or rather, how many jobs our current portfolio of companies and our graduates create (more than 200 so far). We actually are required by the Economic Development Administration (EDA), which gave us a grant in 2011, to track that jobs figure and the amount of money raised (more than $80 million) by our portfolio companies and graduates for nine years! So I check in with them periodically to get updates and to learn news that we can send out to our stakeholders (sponsors, board members, entrepreneur members, mentors, etc.) or blog about. We have a few graduates who still participate in our CEO Roundtable. We bring graduates in to give seminars occasionally. Graduates are invited to participate in our monthly “InnoVentures U” workshop series, which usually addresses business skill-building needs.
Q. How do you spend your downtime, assuming you have any? What do you do to decompress?
A. Downtime? What downtime?!
At 4:00 p.m. almost every day a bell goes off in my head and I know it is time for chocolate. Dark chocolate. Does that count as downtime?
Another form of decompression – though it requires a lot of focus and is hardly relaxing – is that my husband and I got our motorcycle licenses a year ago and we bought motorcycles to run around the North Shore. It’s a gas! We have totally astonished our friends and maybe horrified them a bit. But hey, we didn’t get Harleys. Just Hondas!
In the middle of winter, when the motorcycles are not an option, we try to get a week down in the Virgin Islands to get away from the oppressive cold.
I have a brief morning yoga/stretching routine that I’ve done for 40 years – sometimes more religiously than others – and I’m now doing that routinely again and have joined a gym. Exercise is another of those “nice to have” things that I’ve finally decided is a “must have.” Sleep is another one. I’m giving up on the illusion that I can get by on four or five hours of it. Six minimum, seven is better, eight is amazing.
Probably my favorite form of downtime is to sit on the couch in the early morning sunshine with a cup of coffee, a book or the newspaper, and my two long-haired dachshunds on my lap. I don’t have high blood pressure but if I did, the dogs would be better than drugs!