The Hot List
Rumors of its demise to the contrary, the entrepreneurial spirit is alive and well in Maine. The Pine Tree State doesn't have a reputation as a hotbed of hot start-ups, but every year new businesses discover profitable niches for themselves here, as evidenced by the following fifteen companies.
This first-ever Down East Hot 15 list is not meant to be an unconditional endorsement of these businesses. Instead, consider it as a sort of survey of contemporary commerce in Maine, with a focus on the more innovative ideas now being put to work. If you're interested in who has a plan to make money in Maine, these are some companies that bear watching.
So what makes a business hot? Profitability is an obvious measure, but we don't think it's the only one. Some of the following companies have distinguished themselves by exploiting previously unseen opportunities and changing ideas about what a Maine business can be. Others are trailblazers in their respective industries. Collectively, they all have something interesting to tell us about the state of entrepreneurship in the Pine Tree State.
Location: Offices in Portland, Brunswick, Saco, and Bangor.
What they do: Provide non-medical and personal-care services to Mainers over fifty years old.
Why they're hot: It should seem like a no-brainer that in the grayest state in the nation there would be a need for non-medical services catering to senior citizens and those who will be seniors soon enough. That's why in 1999 Beth Lawrence, a registered nurse and former clinical director for a home-health agency, started Aging Excellence to help Maine's elder population with seemingly mundane tasks like grocery shopping, laundry, handyman tasks, and yardwork. Have an older parent who needs a gentle reminder to take his daily medications? Aging Excellence will give him a friendly call once a day. Need someone just to sift through the complicated paperwork you get from your insurance company? Aging Excellence will translate it for you. Rates vary from eighteen dollars per hour for transportation and companionship services to twenty-five dollars per hour for home-management chores. Lawrence says the services her company provides are unique in Maine and even the country. "Typically a lot of the national services are offering more the homemaker/companion services, and we've packaged that with the personal-care services and the handyman-type offerings," she says. "We help a lot of clients here in Maine whose family members are in California, and they want someone on-site to make sure that they're taken care of."
Lawrence sold her first franchise, a Brunswick office, in 2003 and has since added franchises in Saco and Portland. She owns a Bangor office herself and has two new franchises, in Lewiston/Auburn and in the Bridgton area, under development and expected to open soon. Calls have come in from people interested in opening franchises across the nation, but Lawrence says within the next year she'll focus more on expanding into New Hampshire and Massachusetts. Such expansion is helping Lawrence's company toward financial success, but she says it's having an impact also on Maine's older residents. "We're keeping seniors active, whether it's through the Maine Senior Games or through the Beach to Beacon race or another event or service," she says.
Location: Waldoboro, Portland, Wells.
What they do: High-quality, handmade breads.
Why they're hot: Artisanal bread was a West Coast buzz phrase when Jim Amaral borrowed some sourdough starter from a friend's grandmother and some money from three investors to produce his first loaves of bread in the tiny basement of the Pine Cone Restaurant in equally tiny Waldoboro back in 1993. Four years later he moved the burgeoning business to its own building on Route 1, then opened other bakeries in Wells and Portland.
Over the years Amaral has gone out of his way to buy as much of his supplies as possible from Maine sources. For example, all of the company's whole-wheat flour — more than eighty thousand pounds — is grown and milled on a farm in Linneus, a small town near Houlton in northern Maine. Today Borealis Breads employs more than fifty people and is sold in almost a hundred retail outlets and numerous restaurants in Maine, New Hampshire, and Massachusetts. A year ago it launched MOBO Foods, a tasty partnership with Kerry Altiero of Café Miranda in Rockland that produces six varieties of gourmet take-home pizza sold at independent groceries and specialty stores from Wells to Belfast.
Correct Building Products
What they do: Manufacturer of CorrectDeck, a home decking material made out of sawdust and polypropylene.
Why they're hot: This sixty-five-employee company is bringing innovation — and jobs — to one of Maine's manufacturing strongholds. Correct Building Products takes waste sawdust, reclaimed from mills and manufacturing plants across the Northeast, and combines it with polypropylene — the same stuff Tupperware is made from — to make home decking material that is durable and stain-resistant. The best feature, if you ask us? No need to put your deck out of commission — and your back into spasms — with the annual strip-and-stain ritual.
Of course, there have been some bumps along the way. Customers complained about their fancy new decks staining and getting infected with mildew. Since you pay a premium for CorrectDeck — though the low cost of maintenance and upkeep makes it more than earn out in the long run — that was obviously unacceptable. So founder Martin Grohman, a Carthage native, and his team came up with CorrectDeck CX, a stain-resistant material that includes antimicrobial protection. The new product competes effectively with composite decking material made by large, publicly traded companies like Trex and Louisiana-Pacific. "We don't have their distribution power," Grohman says. "We're sort of like the microbrew of composite decking. We have to make products people want so we can get shelf space to sell them."
And you don't have to just take his word for it. The company has earned kudos from organizations ranging from the Maine International Trade Center to Inc. magazine, which named Correct Building Products to its list of the five hundred fastest growing private companies in America two years in a row. What's more, the company has become the number one supplier of composite decking products in the United Kingdom. "Everyone over there is trying to copy us," Grohman says, noting that the Maine mystique goes a long way overseas. In fact, he adds, a British firm has gone so far as to manufacture a product that's a direct knockoff of CorrectDeck. Its name? "Maine Deck," he says with a laugh.
What they do: Developer of wind-power farms.
Why they're hot: It doesn't take a rocket scientist to see that alternative energy sources are going to be very big business in the decades to come. For the last two decades, Endless Energy has been working to make wind power a reality in Maine, primarily via a proposal to put thirty turbines on Redington Pond Range and Black Nubble mountains in western Maine. Whether this particular project actually moves ahead remains to be seen. But given the tenacity with which founder Harley Lee has pursued it, if it's denied, chances are he will remain an influential figure in Maine's alternative energy industry.
The problem with wind power, of course, is those turbines, which opponents say mar sightlines and endanger wildlife (the controversy over a wind farm proposed for Nantucket Sound, off Cape Cod, has received national attention, for example, and its fate remains uncertain). While Endless Energy's Redington proposal isn't quite that high-profile, so to speak, it, too, has engendered considerable debate. Opponents question Lee's choice of sites, largely because of its proximity to the Appalachian Trail. The same factors that make the site ideal for a wind farm — Redington Pond Range and Black Nubble mountains lie along an unusually long and level north-south ridge, perfect for capturing New England's prevailing westerly winds — make the idea of such a farm abhorrent to groups including the Appalachian Trail Conference, whose regional director said the farm would be a "scar" on the area if approved.
Lee submitted a several-inch-thick application for the project's first five turbines to the state's Land Use Regulation Commission early last year; he's hoping that the body will rule on it shortly. "On the price side, with oil at sixty or seventy dollars a barrel it's putting a big hurt on our economy. And on the other side, global warming issues are becoming harder and harder to ignore," he says. "In a nutshell, we think this is the right project in the right place at the right time."
Location: Stores in Searsport, Rockland, Southwest Harbor, and Portland.
What they do: Retailer of marine products to fishermen, recreational boaters, and commercial seamen.
Why they're hot: Don't try to tell Wayne Hamilton and the crew at his Searsport-based chandlery that the marine industry in Maine is in decline. When Hamilton started selling seafaring products at the head of Penobscot Bay back in 1977 he offered mostly commercial fishing supplies and boatbuilding items needed by the state's lobstermen. Now the biggest discount chandlery north of Boston, he still sells those same products in his four stores in Rockland, Southwest Harbor, Portland, and the original shop in Searsport. But he also offers the chrome-plated foghorns, high-tech global-positioning systems, and onboard cup-holders that today's recreational mariners demand. "We're in the position that we support both markets — we need both," explains David Normann, head of sales and marketing for Hamilton Marine. "Being in the marine business in Maine, where at least the fresh water turns to ice part of the year, is a hard business to be in. The bottom drops out for us because of the winter, and the commercial world is instrumental in keeping us going." Part of the company's expansion has been the result of competition — it expanded to Portland in the 1990s because West Marine, the "big box" of the marine industry, was expanding there — but it has also responded to the changing demographics on the high seas. "The recreational industry has grown," Normann says. "If you went to almost any harbor just in the past twenty years, there used to be a preponderance of fishing boats. Now it's a preponderance of recreational boats." Though some Bay State boaters have begged Hamilton to open a store there, Normann says the company has no plans to expand its 105-person staff outside Maine.
Harbor Technologies, Inc.
What they do: Marine construction using composite materials.
Why they're hot: Many people associate Martin Grimnes with Brunswick Technologies, the leading-edge fiberglass composites company he founded in 1984 and built into a $45-million enterprise. Four years after being forced out in a hostile takeover by a French firm in 2000, Grimnes started Harbor Technologies, a company that takes his expertise in composites from the factory floor to the waterfront.
"We specialize in composite marine infrastructure," explains Erik Grimnes, Martin's son, referring to the floats, docks, and piers the company's nine employees turn out for municipal, commercial, and private waterfront uses at a plant in a Brunswick industrial park. The company built the new docks used on the Bath waterfront, for example, and is working on building a new Coast Guard pier in Jonesport as well as a larger project in North Carolina. After being outfitted with a bow and a two-hundred-horsepower motor, one of their floats is now being used as a barge on Casco Bay servicing boat moorings.
What they do: Real estate development.
Why they're hot: As manufacturing companies continue to leave United
States shores for cheaper locales overseas,
their cavernous plants are left behind, causing a drain on the local tax rolls and often a blight on the local landscape. But not when Harper's Development enters the picture. The Winthrop firm has been quietly redeveloping some of Maine's most significant parcels of industrial real estate, and the most recent project undertaken by its managers, the proposed redevelopment of Saco Island, could significantly alter the face of York County's twin cities of Saco and Biddeford.
Before tackling Saco Island, which is being run by Harper's employees under a separate corporate structure called Saco Island, LLC, Harper's bought the 311,000-square-foot Sanmina-SCI building in Augusta, dubbing it the Central Maine Commerce Center and filling it with tenants ranging from state government offices to the Maine outpost of a publicly traded technology company. And in late 2005 it picked up the vacant, 215,000-square-foot Vishay Sprague plant in Sanford, renamed it the Southern Maine Commerce Center, and set about refurbishing it in the hope of securing anchor tenants.
Along the way, the firm has come under fire for what some observers see as preferential treatment from state agencies given that its CEO, Kevin Mattson, is a former head of the Maine Democratic Party and that his business partner, Severin Beliveau, is both a partner in one of the state's largest law firms and perhaps Maine's most prominent lobbyist. But whether its activities are the result of political cronyism or simply good business sense, Harper's influence on the state's industrial landscape is undeniable.
And nowhere is that more visible than Saco Island, where the group has announced a hundred million dollar plan to renovate the aged and decrepit mill buildings that sit in the Saco River. If all goes as planned — and that is a significant if — the island will become home to new townhouses and condominiums, at least a hundred thousand square feet of retail and commercial space, an eighty-slip marina, and pedestrian walkways — a major transformation for two of Maine's most promising downtowns.
Location: East Boothbay.
What they do: Boatbuilder.
Why they're hot: Hodgdon Yachts launched its first ship in 1816, a forty-two-foot wooden schooner named Superb. Five generations later, Tim Hodgdon and his eighty employees are working on Hull #407, a composite-based advanced prototype of a "medium-range, high-speed, insertion craft" for use by navy SEAL teams and other special-forces units. "It's a technical demonstration for the Office of Naval Research and the Special Operations Command," notes Hodgdon. The eighty-foot boat is being developed in partnership with the University of Maine's Advanced Engineered Wood Composites Laboratory.
In recent years Hodgdon Yachts has been best known for the extraordinary quality (and expense) of its high-end mega-yachts, and Hodgdon says this latest project does not mean the yard is shifting its focus. "It's all about diversification strategies," he explains. The company has also received a grant to do research into a high-speed, composite-hull ferry. "You have to change with the times," Hodgdon advises. "This is one way we're looking at the future."
What they do: Slot machine gambling facility.
Why they're hot: Maine's only racino certainly isn't everyone's favorite new business (it certainly isn't ours), but no one can deny the fact that it has become one of the fastest-growing new enterprises in the state. Since opening in November 2005, its monthly gross receipts have grown from $28.5 million to $50.1 million in August 2006, while net revenues have gone from $2 million to more than $3.3 million in the same period. Thirty-nine percent of the revenue goes to various taxes and fees, including harness racing purses and university and community college scholarships.
With an average daily attendance of 2,500 people drawn to the 500 slot machines housed in a converted restaurant, the racino's success has surprised doubters who predicted it wouldn't attract enough business to be profitable and disappointed opponents who say that slots lead to gambling addiction problems and other social ills. The debate continues, with petitions circulating through the state to force votes on another racino in Washington County and a casino in Oxford County operated by Maine's Indian tribes, even as opponents try to get the legislature to ban gambling altogether. Meanwhile, this spring Hollywood Slots breaks ground on a $90-million facility near the Bangor Raceway that will feature 1,500 slot machines.
Johnny's Selected Seeds
What they do: Produce and sell vegetable and flower seeds.
Why they're hot: Famous for its chatty catalogs and first-rate customer service, Johnny's has been one of the leading seed sources for vegetable and flower gardeners across the Northern Tier from its beginning back in 1973. The company produces some of its own seed and buys more from specialty growers in Maine and New England as part of its campaign to encourage local agriculture and to avoid genetically modified seed stock. Today the company is a $12-million a year business — up from $8.4 million in 1999 — with 170 employees.
Last April founder Rob Johnston, a longstanding critic of consolidation within the seed industry, announced plans to sell the company to its employees. The move solidifies the company's future while protecting it from being bought out by one of the international seed companies that dominate the market.
Lincoln Paper & Tissue
What they do: Manufacturer of specialty napkin and tissue, as well as uncoated paper.
Why they're hot: Late last year, Lincoln Paper & Tissue dedicated the first new paper machine in Maine since 1990. What sounds like a mundane event — bring out the politicians for a round of ribbon cutting and speeches about a big hunk of metal — actually represents a significant step forward for Maine's paper industry. Lack of investment in equipment has been a major issue for the paper companies that once dominated Maine's economy. And with increasing competition from around the world, it's easy to see why equipment that's headed toward obsolescence could seriously hamper Maine's mills.
In fact, back in 2004 the Lincoln mill was closed, a casualty of former owner Eastern Pulp and Paper's drawn-out bankruptcy and eventual closure. Chances for revitalization seemed slim. But in stepped a pair of Connecticut-based investors with a plan to not only restart the mill but return it to profitability — practically immediately. Yes, Keith Van Scotter and John Wissmann are running the mill with fewer employees than operated it previously, and those jobs are sorely missed in the region. But the pair's ability to increase efficiency while minimizing overhead is, in large part, what has led to their success.
As for that success, it's embodied in the $36-million paper machine the company feted last fall. To finance the machine, which produces the dyed tissue paper that Lincoln Paper & Tissue sells around the world, the company secured a multimillion-dollar investment from a California private equity firm — another event that's relatively unusual for Maine companies in general, and downright unheard of in the state's paper industry. And Van Scotter and Wissmann say they're planning to keep putting money into the plant, with another $13 million slated to be invested this year.
Location: Stores in Yarmouth and Charlestown, South Carolina.
What they do: Manufacture and distribute cottage-inspired furniture to designers, retailers, and homeowners.
Why they're hot: Carol Bass has learned how to turn color into cash. What she started as Maine Cottage Furniture in 1988 with just eleven designs has blossomed into two hundred designs in two stores, one an impressive seven thousand square-foot showroom on the Royal River in Yarmouth, the other half that size yet equally striking in Charlestown, South Carolina. No matter which side of the Mason-Dixon Line they happen to be on, the homes that Bass has helped furnish all share the same dynamic nature-inspired colors, unpretentious yet striking appearance, and the comfy, classic feel that is the soul of the Maine cottage. Whether it's a wicker chair for a screened-in porch or a beadboard media case for that new plasma television, Bass' designs somehow manage to turn antique styles into modern furniture. (Her unique colors, from the awesomely azure Iris to zesty Hot Lime, have been showing up at hardware store paint counters as people try to mimic the Maine Cottage look on their own.) These days about 40 percent of the company's business is with interior designers, with the rest coming from wholesale distributors servicing specialty furniture stores. Bass' cottage look doesn't come cheap; a wicker patio table will run you $890, while a six-drawer dresser or upholstered love seat may cost three times that amount. But for those who crave all things cottage, the quality furniture that this Maine company turns out is worth any price.
What they do: Offer sixty trails for alpine skiing and snowboarding as well as condominiums for sale or rent on an eight thousand-acre property.
Why they're hot: If you like spending time in Maine's western mountains, you need to be watching what's going on at Saddleback. This formerly sleepy ski resort has been awakening from its slumber in a big way during the past three years, as former Farmington professor Bill Berry and his family have poured their energy — and their sizeable financial backing — into making the mountain a major destination for Mainers and out-of-staters looking for a more family-friendly mountain [Down East, December 2006]. They've already boosted snowmaking from 50 to 85 percent of the four thousand-foot mountain, built one new chairlift and lengthened another, and the Berrys say they're just getting started. The real estate developments under way are impressive on their own — a new base lodge is nearly double the size of its predecessor, plans are in place for a hotel, and the number of bedrooms on the mountain is projected to leap from 370 to 2,117 within the next ten years — but coupled with plans on the slopes and surrounding countryside Saddleback has the capacity to transform the Rangeley area, where beds can be in short supply during peak season. "We want to develop a four-season resort that would eventually entail development of an inn and hotel, and possibly an RV park," Berry says. "To a great extent we would not be competing with the Rangeley area, but use the amenities of the Rangeley area and we would be providing a place to stay."
Whether you're interested in catching big air on Saddleback's half-pipe or prefer to enjoy the fall colors from Rangeley Lake, it'll pay to keep an eye on this big little mountain in western Maine.
Shipyard Brewing Company
Location: Brewpubs in Kennebunk, Eliot, Newry, and Kingfield. Headquarters and brewery in Portland.
What they do: Brew, market, and distribute more than a dozen varieties of their Maine microbrews.
Why they're hot: Here's one Maine company where you can actually taste the success. In 1992, when entrepreneur Fred Forsley enlisted the help of a Briton named Alan Pugsley to help pour some life into a restaurant he was starting in Kennebunk, he had no idea how popular Pugsley's suds would become. Within just two years the pair would outgrow the brewery they'd built at Federal Jack's restaurant, moving the operation to larger quarters on Newbury Street in Portland (though they kept their location on the Kennebunk River). The two didn't stop there, opening brewpubs at the state's two biggest ski areas, in Newry and Kingfield, and partnering with hotels and restaurants to feature their signature brews. Forsley and Pugsley tested the national waters in 1995 when they entered into a 50/50 split with Miller Brewing Company but ended the deal five years later by repurchasing Shipyard's shares. And when the Sea Dog Brewing Company went on the block in 2002, they snatched it up and preserved the Sea Dog brand. "I know firsthand how much those restaurants are valued by the local communities," Forsley said. "The Sea Dog restaurants are an important piece of the Sea Dog brand." (Shipyard now brews and bottles Sea Dog beer but markets it separately and manages the Sea Dog brewpubs in Bangor and Topsham independently.) Today, the Shipyard taste is enjoyed well beyond Maine's borders; last year the company shipped 770,000 cases of beer, an 11 percent increase over 2004, and even operates a brewpub just a stone's throw from Mickey and his gang in Orlando, Florida. Over the past three years alone the company has grown 40 percent.
That sounds like a success story we can all drink to.
Tex Tech Industries, Inc.
Location: North Monmouth (manufacturing plant) and Portland (corporate headquarters).
What they do: Manufacturer of high-tech fabric.
Why they're hot: From a North Monmouth factory that used to make woolen baseball uniforms, Tex Tech these days is producing technically sophisticated products ranging from tennis ball felt — bet you didn't know that different court surfaces call for different felt specs — to fireproof material that will line the cabins of about four thousand airplanes manufactured by Airbus, the French jet manufacturer. It was a big coup last year for the company formerly known as Annabessacook Mills to score the Airbus contract; with annual revenues of $26 billion, the aviation company doesn't mess around when it chooses suppliers.
Though Tex Tech has largely flown under the radar locally — the appearance at its plant of Governor John Baldacci and the consul general of France for the Airbus announcement notwithstanding — its more than two hundred employees have been hard at work. In addition to tennis felts and fire retardants, the company makes ballistics materials used in body armor for U.S. troops and bulletproof vests for safety personnel. Those fabrics are the product of the company's research and development division, which holds five patents for materials that increase the safety performance of products. And late last year it was recognized by the Washington, D.C.-based Small Business Technology Council for its innovative use of federal R&D funds.
R&D investment is critical to the state's future, as many an economic development official will tell you. And while it is critical that the state put some cash on the line, it's even better that companies like Tex Tech are investing their own money in Maine workers and Maine ideas. We can't wait to see what this creative company comes up with next.