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New Springs center a catalyst for startups

The opening of the Catalyst Center in Colorado Springs last month raised some eyebrows in the startup community across the state, although by most measures Boulder still remains the envy of most of the nation in this regard.

The Springs campus, a string of three buildings near downtown, is anchored by the remodeled Sante Fe Railroad station and features about 100,000 square feet of communal workspace, commercial offices, executive suites and research and development facilities focused on the startup community. When it opened in mid-June, it already had attracted more than a dozen small startup companies, and is housing a publicly funded endeavor to assist the transition of manufacturing companies called FourFront Fuse Impact Center.

Colorado Springs Mayor John Suthers said the center will help attract new startups to his city, but also is an indicator of a transition already occurring in a city historically known for its defense-industry companies.

“It’s a great place, and the kind of thing you’d see in Boston and other cities known for their support of the tech industry,” said Suthers about the remodeling of the early 20th-century train station, one of three buildings included in the campus. However, Suthers — who served as Colorado attorney general from 2005 to 2015 — noted that an economic transition in the Springs is already under way.

“For the first 15 years of this century, we were creating maybe 3,000 jobs a year (in El Paso county). We weren’t seeing the increase that other parts of the state were seeing in the energy sector and tech fields,” he said. “But things have really taken off in the last year, as we created 9,000 new jobs.”

The center communal space includes conference rooms highlighted by extremely large high-definition screens allowing for virtual conferencing and data sharing at high speeds via internet connections supplied by Comcast. The partners in the Catalyst Center are based around the O’Neil Group and its recently acquired Braxton Technologies, which has expertise and products in command and control, satellite ground systems, software development and systems engineering.

Suthers said the group’s chief executive, Kevin O’Neil, had an early career in real estate, although the group’s focus is now company acquisition, and was able to garner some concessions in development, including a partnership with Comcast to provide high-speed internet. With $1.5 million in matching funds, the partners also received a $750,000 grant from the Colorado Economic Development Commission to create the 10,000-square-foot Cyber and Space Operations Center, which Braxton will use to complete two Small Business Innovation Research contracts awarded by the Air Force Research Laboratory.

As with Boulder County, the No. 1 job opening in the Springs, which encompasses about two thirds of the entire county, is for software engineers, Suthers said. Cyber security is a growing concern here, along with a growing aerospace industry that the area historically has supported.

One area that is a concern in the Springs is a decline in the manufacturing needs of military contractors, a reason that ForeFront Fuse has located here to serve all of southern Colorado. The Colorado Advanced Manufacturing Alliance oversees implementation of a $6.6 million grant from the Department of Defense to establish advancement centers intended to help defense companies and manufacturers grow, advance and diversify into new markets, and poured $1 million of that into ForeFront Fuse’s headquarters at Catalyst Center for the first two years of programming and funding.

Director Jahr Turchan said his ForeFront Fuse center, one of four that will be established across the state, hosts programs, seminars and training, as well as providing manufacturing companies access to funding.

“My mission and daily goal is to reach out to as many manufacturing companies I can, to find what are their pain points and barriers to growth,” Turchan said. “Through our ForeFront Center, they can avail themselves to $15,000 worth of funding to assist in manufacturing transition.”

Turchan said locating at the Catalyst Center was a natural, as all the ForeFront locations will seek to ally themselves with strategic partners. In Loveland, he noted, the ForeFront location at the Rocky Mountain Center for Innovation & Technology will benefit by the fact that EWI, whose missions in Colorado is to assist companies to move from research and development to manufacturing, is located in the same facility.

But are the economic development types in Boulder worried about the rise of startups in Colorado Springs? Hardly, said Clif Harald, executive director of the Boulder Economic Council.

“I think ‘the more, the better,’ and I hope they are outrageously successful,” Harald said. “It’s not really a competitive thing. It’s a complex economic ecosystem that supports startups. More like ‘a rising tide raises all boats.’ ”

Boulder also has a diversified number of such communal workspaces and incubators including TechStars, university-funded coworking space and privately funded endeavors.

Harald said that a recent study by the Kauffman Center found that the Boulder areas was rated No. 1 in the world in startup density (somewhat akin to startups per capita), and had twice the density as the No. 2 location, Silicon Valley.

“About a third of all the venture capital in Colorado (or a quarter billion dollars annually) comes into Boulder,” he said. “There’s a value system that’s obvious in Boulder and Denver and Longmont. A value system of paying it forward: The successful entrepreneur supporting the next generation of startups.”