Published in Food/Agribusiness
Noreen Garrido of Kalamazoo Latino Specialties LLC, which specializes in empanadas. Noreen Garrido of Kalamazoo Latino Specialties LLC, which specializes in empanadas. COURTESY PHOTO

Food incubators, accelerators on the rise in West Michigan

BY Sunday, January 02, 2022 06:26pm

KALAMAZOO — When it first opened in 2008, the Can-Do Kitchen in Kalamazoo provided an avenue for budding food entrepreneurs to take their businesses outside of their homes and into a professional kitchen.

Leaders at the nonprofit organization have since developed a variety of additional programming and resources to wrap around their incubator kitchen. They also look to bring the program to the next level in the coming year.

Can-Do Kitchen has raised roughly 80 percent of its $650,000 fundraising goal for a capital campaign that launched in June 2020 and would bring the funds needed to renovate a new facility located at 519 S. Park St. in Kalamazoo. The organization plans to take out a long-term lease on half of the 20,000-square-foot space.

The new project would include amenities such as co-working space, classrooms and offices all under one roof to foster food businesses at all phases of their life cycles.

These resources would equip Can-Do to include an accelerator component with its incubator kitchen, allowing a food entrepreneur to enter with an idea and grow until it was ready to seek out its own standalone space.

“The fact that we have more physical space will provide room to have more programming and be able to offer accelerator programming or businesses that are established but need that next level boost,” said Can-Do Kitchen founder and Executive Director Lucy Dilley, who hopes to start construction on the new building this spring.

The (missing) next step

The small food business landscape in West Michigan is dotted with incubator kitchens, which are crucial in helping entrepreneurs transition an idea to a business through access to a professional kitchen and equipment. 

But as a food business grows out of that initial stage, its needs become more complex. Can-Do Kitchen, in addition to similar programs, looks to fill that gap.

Can-Do — which already offers business planning, facility rental and microloan programs — is looking to incorporate a steady roster of private industry partners that will help to mentor program participants, beefing up its existing resources for food entrepreneurs.

“It takes money to scale up and that’s always difficult for a lot of small businesses to access, especially if you’re maybe a low-income entrepreneur or an entrepreneur of color, a woman, or immigrant entrepreneur,” Dilley said. “That money is not scarce — it’s there — but accessing it can be really hard.”

“I think these accelerator programs really give people the specific services and support that they need to run their businesses more effectively,” Dilley added.

Can-Do is among multiple organizations that have noticed the lack of resources for growing food businesses. In spring of 2021, Greater Muskegon Economic Development and the West Michigan Food Processing Association opened the Food, Agriculture, Research Manufacturing (FARM) Center on the campus of Muskegon Community College. That program has since partnered with Michigan State University.

Economic development organization Battle Creek Unlimited and St. Philip Roman Catholic Church in Battle Creek have also joined forces to develop the Southwest Michigan Accelerator Kitchen, which will leverage partnerships with companies like Kellogg Co. to provide resources for program participants.

Nonprofit organizations SpringGR and Amplify GR are also partnering to provide resources for nascent food businesses specifically in the Boston Square neighborhood in Grand Rapids.

The two organizations are partnering to open what they are calling Kzoo Station: A Community Kitchen + Eatery. The program will find a home at 1445 Kalamazoo St. on the city’s south side. The lot is currently home to a shuttered auto repair garage.

The 1,416-square-foot facility, which is currently under construction, will be home to both a commercial kitchen and space for multiple food retailers. 

When announcing the project, the organizations stated that they hoped the resource would encourage the formation of more Black-, brown- and women-owned businesses while also providing additional food resources for the surrounding neighborhood.

“I think our region is realizing how important this is,” Dilley said. “And with COVID and all of this additional funding opportunity that has happened — and the acknowledgment that there are so many barriers that we really can’t ignore anymore — I think that’s really heightened and helped propel and funnel the resources.”

Down on the FARM

FARM Center Manager Clarence Rudat acknowledged the prevalence of general business incubators, but noted that they rarely translate to the food business.

“We’re a little bit different,” he said.

The FARM Center provides 2,600-square-foot bays for each tenant, which currently includes kombucha brewer Lively Up Kombucha LLC and seasoning producer Kaja’s Flavor LLC. In addition to the space, Rudat and MSU provide resources that help established food companies.

Rudat said packaging and logistics is one point of emphasis in addition to services like nutritional labels and feasibility studies for businesses looking to penetrate new markets.

“I consider FARM to be a true accelerator where we’re providing the space and you’ll be bringing your own equipment,” Rudat said. “You’re getting ready to be the real deal out there. Your next step is going into your own facility or you’re big enough to go with a co-processor or co-manufacturer.” 

Zack Smith, founder of Lively Up Kombucha, saw FARM’s accelerator as a perfect fit. Founded in 2017, and with no investor involvement to date, Smith started in a rental kitchen before outgrowing it.

“We reached a point where we were in such high demand and we were growing so quickly that we needed to move out — we needed our own space,” Smith said. “But we were also such a small company where we weren’t ready to take on that $100,000 or $200,000 note to build out a warehouse and our own facility. FARM really kind of fell in our lap and had all the essentials.”

Lively Up is the prototypical food business that accelerator programs are designed to help keep afloat and move along in their life cycles. For Lively Up, the company also faces the challenges that come with the fermented beverage industry, which is generally accompanied by significant overhead.

“Basic amenities that food processors need like plumbing, electric, sinks and drains — all the foundational pieces on their own are really expensive, let alone lease rates in inner city areas,” Smith said. 

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