Incubator nurtures American Indian-owned and other minority businesses

Kathy Cobb | Associate Editor

Published July 1, 1992  | July 1992 issue

When Brenda St. Germaine drove down Franklin Avenue in Minneapolis in the mid-1970s, her response to the decaying commercial strip was, "Why doesn't someone do something about this mess?"

It turned out that she was the "someone" to do it when she became executive director of the American Indian Business Development Corp.(AIBDC) in 1975. Since then St. Germaine and AIBDC have sparked the creation of more than 350 jobs through businesses that contribute $170,000 annually to the tax base. "And we've cleaned up four blocks," says St. Germaine.

AIBDC's first highly visible project was a neighborhood shopping center which opened on Franklin Avenue in 1982. The fully leased center provides the neighborhood with grocery, pharmacy and other services and also provides 90 jobs, half of which are filled from the neighborhood.

The remaining 250 or so jobs were created by the Franklin Business Center, a business incubator, that opened in 1989. The center, with a mix of large open manufacturing/warehouse space and office suites is fully leased and has a waiting list for office space.

In addition to Prosper Industries, four other businesses in the center are American Indian-owned or are non-profits operated by American Indians. The remaining 10 businesses are owned by women and African Americans.

The key to the center's success, St. Germaine says, is to make coming to work fun for the tenants. "I watch these people struggle every day. They don't get paid, they have cash flow problems, employee turnover. If I can make the atmosphere happy, I will." St. Germaine and her staff have been known to host pig roasts in the hallways, place Halloween tombstones around the building and hand out cookies on Valentine's Day.

In a more serious vein, St. Germaine also brings in speakers and, like other business incubators, provides typing, computer and various support services as needed by the fledgling companies.

And St. Germaine is respectful of her tenants. "There's a fine line between helping and butting in," St. Germaine says. "I'll know how a business is doing when it comes time to pay the rent. Looking at their books is intrusive."

St. Germaine says the Franklin Business Center is unique because most incubators are run by cities or other government-sponsored entities. The center defies rule of thumb because it is owned by a non-profit corporation, located in a poor, inner city neighborhood and within the first year it was 80 percent leased.

"We've had visitors from everywhere--Japan, South Africa, South Dakota and North Minneapolis talk to us about our program," St. Germaine says.

St. Germaine says that there have been no special problems or roadblocks for her minority-owned business tenants. "They all have the same problems," she says. "A new business is a new business." And while it might appear that American Indian entrepreneurs would have better luck starting a business in an urban area, with a large and varied support structure and customer base, St. Germaine wonders if starting a new business on a reservation might be easier because it is essentially a small town.

In a city with the third largest urban American Indian population in the country, and a neighborhood where the Indian population has increased 24 percent from the 1980 census to more than 4,000, AIBDC has just made a dent. But St. Germaine has more plans for Franklin Avenue.

AIBDC wants to develop a small strip shopping and service center across the street from the business center, but that project is on hold until funding becomes readily available. Also, St. Germaine and Prosper Industries' Waukon are working with the city to acquire a vacant grocery store down the street to house Waukon's expanding business and perhaps a city-owned incubator, which St. Germaine proposes to manage.