Start Me Up: Omaha Providing Fertile Ground for New Entrepreneurs

After 12 years as a pastry chef for a catering company and a couple years in the planning, Chelsie Schroeder finally took the life-altering step in 2019 to open her own business, The Bubbly Tart.

In many ways, the timing couldn’t have been worse, given what we now know lurked right around the corner in 2020. But entering 2022, Schroeder’s venture is running on all cylinders having grown from doing just weddings-to-order to the food hall at The Switch in Blackstone to her own store at 3020 Leavenworth St. a little more than a year ago.
It wasn’t easy but it looks that way, thanks to resources and support the Fairbury native found in the local entrepreneur ecosystem.

“Omaha is definitely an A-plus,” she said. “Seriously, I probably couldn’t have done this in any other city.”

Photo courtesy of The Bubbly Tart

Foremost among the resources Schroeder took advantage of was Kitchen Council, a unique regional effort serving food entrepreneurs. In Schroder’s case, that meant providing a commercial kitchen where she could fill orders until securing her own equipment and production space at her retail location.

“They were really great,” Schroeder said. “They have a lot of connections. If you needed a loan or something, Kitchen Council would know who to connect you to, give you their email, make the introduction. They were there to help you, which they did help me quite a bit. It’s a very supportive community.”

Pandemic Fuels Startups

In one of the most curious twists of fate, the very virus that brought the world to a halt two years ago has proven to be high octane for the engine of entrepreneurship in America.
After years on the wane, startup activity is on the rise over the past couple of years as people have decided the best buttress against professional uncertainty is to take the reins and steer their own futures.

As the Peterson Institute for International Economics noted early in 2021, business startups rose from 3.5 million ventures in 2019 to 4.4 million in 2020, an increase of 24%. The trend proved to have legs — in January 2021 alone there were about 500,000 new startups and, as the U.S. Census Bureau noted, startups in November 2021 were up 44% over 2019 numbers.

Of course, desire and opportunity aren’t the only things that make a successful venture. Education and mentorship are equally — if not more — important, leading newcomers through a maze of operational and legal details, especially in an industry such as food products. That’s where Kitchen Council comes in.

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“If you have food products and you want to get that into the hands of customers, from a regulation standpoint, you’re going to need to acquire some sort of food permit in order to make that product and sell it,” said Holly Benson Muller, managing director. “That’s a great example of where Kitchen Council steps in and helps that novice entrepreneur learn what is your business model, what is your product, what are you producing, how are you making that and what are the food safety ramifications involved in that?

“We help them navigate that process because starting a food business is daunting and then the regulations piece of it is even more daunting. We help them understand this from a birds-eye view of what you need to be considering if you’re going to start a business and then here is the road map and here is where to start.”

Photo courtesy of Kitchen Council

The idea for Kitchen Council started percolating about six years ago when various business entities, including the Iowa West Foundation and Greater Omaha Chamber, looked at the growth of farmers markets and the individual cottage industries represented there. Kitchen Council’s commercial equipment and production space, as well as onboard advisory and educational programming helps some of those ventures take the next step.

“We work with upwards of 15 to 20 resident members per year,” Benson Muller said. “Those are members who are actually licensed and working out of our kitchen facility. But we are also working with 100-plus regional entrepreneurs, on average, who are just reaching out to Kitchen Council for general support or knowledge or being pointed in the right direction.”

At the time it was founded, Kitchen Council was relatively unique in the local market, but as other food entrepreneurship programs have grown up around it, Benson Muller said the resulting continuum of resources has been impressive.

“Kitchen Council is not the ‘it’ program that is solving all of those problems. We’re a resource provider fitting into that entrepreneurial roadmap and part of our job is connecting with those other existing resource providers, making sure we’re all working together to lift up these local entrepreneurs,” she said.

From Lab to Market

Similar work is being done through the UNeMed program, founded in 1991 as the technology transfer and commercialization leader for the University of Nebraska Medical Center. Now working with inventors at both the University of Nebraska at Omaha and Nebraska Medicine, UNeMed builds and develops partnerships with industrial leaders who can help push innovations beyond the laboratory and into the marketplace.

Once merely concerned with patents, the office has evolved to play a role in the complex and expensive world of converting discovery into a viable product. Charles Litton, UNeMed communications manager, said the types of discoveries and inventions the office deals in are primarily medical in nature (although there has been some diversification in recent years) and vary from medical devices that improve on existing technology to building blocks that require additional development.

“Someone might discover there’s a particular protein involved with pancreatic cancer, for example,” Litton said. “That’s scientifically very interesting, but there’s not really anything you can do with it.

“What we typically do is approach people in the industry and say, ‘Hey, we’ve got this thing. Does this sound like something you’d be interested in?’ They take a look at it and then they decide whether or not they’re going to enter into a partnership with our inventor.”

Litton said in the absence of UNeMed, many medical discoveries wouldn’t advance past the laboratory, given the high cost of bringing it to market.

“The federal government funds discovery. It’s private industry that funds development,” he said. “Therefore, the first step isn’t necessarily to get it protected. The first step might be to see if anybody is interested. It might be another billion dollars before a discovery becomes an actual treatment or cure. The National Institutes of Health isn’t going to fund that follow-up development.”

Among UNeMed’s success stories is Virtual Incision Corp., a medical technology company founded by faculty at both the University of Nebraska-Lincoln and UNMC. Virtual Incision’s product reduces the invasiveness of bowel resection surgery through the use of a laparoscopic surgical platform.

The company, which conducted the successful first-in-human use of its surgical device in 2016, located its headquarters at Nebraska Innovation Campus in Lincoln.

“Nebraska Innovation Campus has been honored to engage in the growth of Virtual Incision,” said Kate Engel, the organization’s director of strategic partnerships and communication. “Locating on Nebraska Innovation Campus provides the Virtual Incision team with access to a host of unique amenities, access to our Nebraska Innovation Studio makerspace and access to university talent and resources.”

Nebraska Innovation Campus differs from other university-based or -affiliated incubators in that it is open to private entrepreneurs as well as shepherding inventions and discovery from within the university ranks.

“Nebraska Innovation Campus is an asset and resource to strong university, local and statewide startup ecosystems,” Engel said. “Resources at Nebraska Innovation Campus help translate university research into products and services that assist people in Nebraska and beyond.

“NIC resources also support startups that boost and diversify our state’s economy. We are home to a growing roster of diverse partners, welcoming companies of all sizes creating a culture filled with a mix of startups, medium-sized companies and larger companies.”

NIC offers office space, wet/dry lab space, pilot plant space and greenhouse space for lease, as well as one of the premier maker spaces in the country. The 16,000-square-foot Nebraska Innovation Studio houses a full metal shop, wood shop, rapid prototyping room, art studio, ceramics, textiles equipment and more.

Strength In Numbers

Aside from the plethora of facilities and resources Nebraska Innovation Campus, UNeMed and Kitchen Council provide their constituents, attracting sufficient funding remains a thorny issue for entrepreneurs, putting Nebraska behind the curve compared with other states.

However, said Jade Jensen, CEO of Appsky, even though there’s much work to be done in this area, there are plenty of examples of how things are beginning to improve.

“The most progress I’ve seen in the community as far as resources for entrepreneurs has been in pre-seed funding, the stage of funding to get a viable project off the ground,” she said. “A few years ago, there were not as many pre-seed funding opportunities for startups for product development. Now there are more investors and organizations interested in providing funding resources for early-stage startups.

“I think later-stage funding in Nebraska still has a long way to go. The number of Nebraska-based businesses seeking and receiving funding to that level is far less common than what you may see elsewhere.”

Part of what’s advancing the startup community in Nebraska is the ready access to fellow entrepreneurs as a source of information, guidance and support. One Million Cups, of which Jensen is a co-organizer, is one such group in Omaha.

“One Million Cups, a weekly entrepreneurship meetup, was helpful in introducing us to other startups, some who have become clients, as well as other resources and people in the startup ecosystem,” she said. “You know the saying, ‘It takes a village to raise a child.’

The same thing is true of a business. There have been many lessons we’ve learned over the five years since starting Appsky. As a business owner, the sooner you recognize your strengths and weaknesses, the better. You can’t do it all, no matter how much you want to.”

Shelley Elson-Roza, co-founder of Heirloom Fine Foods, has a unique perspective on the Omaha startup ecosystem. She and her husband, Anthony Roza, launched their venture in Chicago in 2015 before moving back home to Omaha five years ago.

“I don’t know that I would phrase it necessarily from the perspective of how does one community do ‘better’ than the other,” she said. “I think the thing that is important in general as an entrepreneur is to take the time to get to know your market.

“There are plenty of resources in Omaha for entrepreneurs. You just have to know where to look and you have to be engaged and hustle to get in front of the right people. Sometimes it’s not that resources aren’t there, you just have to be able to get better at knowing where to find them compared to bigger cities.”

In Heirloom’s case, that meant getting connected to No More Empty Pots and later the Kitchen Council to get the lay of the land and start to network and build clientele, Elson-Roza said.

“No More Empty Pots was extremely helpful in connecting us to a bunch of different clients where we got to do some high-profile things like thousands of cookies for First National Bank’s Christmas event one year,” she said.

“When we grew to need bigger space, the biggest hurdle was the time it took for us to find the location we wanted for our forever home. That was a two-year process of looking for real estate and then building out that space, during which time we moved to Kitchen Council. It was great to be able to grow the business out of there while we were undergoing that process.

“We also appreciated all the time in the incubator kitchens because we really got to hone our menus and our concept. We needed the time to perfect our craft before being ready for prime time and now that we’ve been in our space for a couple years, we’re really ready to hit the ground running.”

Ensign Pharmaceutical

Courtesy of UNMC

UNMC chemist Dong Wang, PhD, created a thermosensitive hydrogel formulation called ProGel, a novel platform technology that can deliver a variety of therapeutics. ProGel has attracted wide interest as the cornerstone technology for Dr. Wang’s startup, and its massive potential makes Ensign Pharmaceutical the 2021 Startup of the Year.

On the shelf, ProGel is a liquid. However, after ProGel is injected, it transforms into a gel-like substance as it warms to body temperature. The gel is then more likely to linger in the affected area, concentrating the pharmaceutical payload exactly where it needs to be.

Ensign’s first product will incorporate a potent steroid, dexamethasone, into the ProGel formulation. An upcoming Phase II SBIR study will identify the optimal formulation, and evaluate its long-term efficacy in the treatment of arthritic joint pain.

While effective for pain relief, the benefit of dexamethasone is unfortunately short-lived, usually lasting only a few days. However, when formulated with Dr. Wang’s ProGel, dexamethasone has the potential to remain active much longer, potentially providing relief for months.

The hydrogel allows a slow release of the payload—dexamethasone, in this case—while being retained at the injection site. In addition to providing a more sustained and stable local release of medication, the hydrogel also has the benefit of limiting potential harmful side effects, including weight gain, increased blood sugar, insomnia and osteoporosis.

Ensign Pharmaceutical recently secured nearly $2 million in federal research grant funding, which will support pre-clinical studies needed to approach regulatory approval. Ensign won the 2020 Business Innovation Live Pitch competition in Phoenix during the Orthopaedic Research Society’s annual meeting.

Also, Ensign was selected to present at highly selective startup conferences, the Invest Midwest Venture Capital Forum and Destination Startup.