Have you considered moving your business to Maine? People move to Maine all the time because they’re looking for a higher quality of life, a better place to raise their children, or to be closer to outdoor activities. But businesses are also moving to Maine. What are the benefits? Are there any downsides? Peter DelGreco of Maine & Company talks about the benefits of moving a business to Maine, and why so many Maine companies are welcoming new “competition” with open arms.
Rich: Our guest today serves as President and CEO of Maine & Co., a privately funded business attraction and economic development organization. Charged with helping companies establish successful and profitable operations in Maine, Maine & Co.’s Board of Directors consists of top executives from Maine’s business community.
During his tenure, Maine & Co. has attracted numerous companies to Maine that now employ thousands of people across the state. He’s a graduate of Colby College, and he earned his MBA from the University of Southern Maine. He and his wife and son reside in North Yarmouth. We’re looking forward to learning more about Maine & Co. with Peter DelGreco. Peter, welcome to the show.
Peter: Thank you, excited to be here.
Yury: We are delighted to have you. Peter, can you tell us a little about Maine & Co. and how did you end up there? What was your background?
Peter: Sure. Like everything, nothing is ever a straight path. So I did go to Colby College, which was my first experience here in Maine. And after graduation I left for a while, I moved down to Washington DC where I met my wife who was also a Colby College graduate. We’re actually the same class.
Rich: Oh, that’s funny. Did you know her when you were there?
Peter: We knew of each other, but we kind of ran in circles. We joke that we probably wouldn’t be married today if she knew me in college.
Rich: How many marriages that for that is true, right?
Peter: So from there it was right around, believe it or not, right around 9/11, when we decided we wanted to move back to New England. We actually got married the weekend following 9/11, and we honeymooned in Maine. And as much as we enjoyed ourselves in DC, we decided DC wasn’t where we wanted to be. We wanted to be back in New England where we’re both from. And so we decided we wanted to move back to Maine.
But while I was living in DC, right around 1997, 1998, I had heard of this organization, Maine & Co. And I just kept following it because I always knew that somehow, some way we were going to end up back there. And as soon as we got back to Maine, she got a job first, I went back for my MBA. And as I was finishing up my MBA, a job opened up at this organization that I’d remembered from a few years earlier. And that’s kind of how it started. Started reading a news article in a newspaper in Washington DC.
Rich: And you didn’t start as Executive Director, did you?
Peter: No, I did not.
Rich: So what were you doing when you first started there?
Peter: I was the Director of Client Services and in that role it I managed all the projects. The first big project that I worked on in 2004 was the T-Mobile facility, which still employees about 700 or 800 people in Waterville, Maine. And that was actually pretty exciting for me personally because I got to do that a little bit in conjunction with Colby College. So we held the big ribbon cutting and announcement at the student center there. And it was just a pretty exciting time.
Yury: And Peter, when you say you managed projects, did they consist of the same type of things that you had to do or every single project was unique based on the industry or the clients or locations?
Peter: We’re big believers that everything is unique and special and has its own intrinsic value. As much as it might make life easier if we could say, “Oh yeah, everything has the exact same pattern, or what’s important for one project is important for all sorts of projects.” The reality and the truth is it’s not, so everything requires its own unique way of looking at things.
And we’re big believers that at our organization, at Maine & Co, that you’ve got to learn what’s important for a company, what’s important in their decision making. Because whatever is important for one company might not be as important for another company. Of course there’ll be some commonalities. But the true place where we bring value as an organization is by learning what is intrinsically important to a group, to a company, and then finding out where in Maine that company can find that specific set of criteria that they’ve identified to allow them to be successful.
Rich: All right. Are there specific types of industries that you go after to attract certain companies to Maine?
Peter: That’s a great question. Some of it depends on the economic cycle that we’re in. If you remember, maybe the time around the world fell apart with the great recession in 2008, 2009. National economy kind of bumped along pretty slowly through 2012, 2013. We were knocking on doors a lot and we spent most of our time in Boston. We had developed our theory, which still holds true today, that Boston is arguably the center – one of one of the top two or three worldwide centers – of new venture creation. And we had noticed that a lot of our projects in the past had been companies that were maybe headquartered in Boston or started in Boston by people that had a familiarity or background with Maine.
And there was an understanding of what Maine could offer in terms of a company’s growth strategy. So we were finding companies across all industries but maybe hit more of a growth profile where they were in the company stage of growth. And from there we would work with them.
Now our projects are usually multi-year projects. So one that I like to talk a lot about that we’ve done that we did a lot of work with back from 2004 to 2007 – so a little bit before this time – was a company called Athena Health. But that was kind of the poster child for how we looked for companies at that point in time. Companies that had figured out their product market fit, had raised a couple rounds of venture capital, were probably on an IPO track, and we’re now looking to scale. On the 128 belt is a pretty hard place to scale.
And we thought that – and correctly as it turns out – that Maine is a much easier place to scale a business. So we from there during that period of time, we were not going to a lot of venture capital meetings, knocking on the doors of companies like Carbonite and Wayfair, companies that kind of fit that profile.
Fast forward a couple years later, now we’re in a fairly hot economy nationwide and there are some industries that are clearly looking to Maine that view us as having a strategic advantage. And we’re doing less overall outreach because our phone is frankly ringing a lot.
Rich: That’s fantastic.
Peter: It’s, it’s a pretty exciting time. So I’ve been doing this since 2004 and we’ve never seen the phone ring like it is right now.
Yury: That’s, you know, that’s successful. So you know, this podcast is all about growing Maine businesses, Fast Forward Maine. And your organization is actually all about growing businesses outside the state and showing them how to succeed here. So how do you do it?
Peter: Again, there is a lot to learning what does a company need to be successful. So companies in all, all different industries, all different sizes, all have their own unique criteria. And it’s really our job to build that relationship and understand what’s going to get them across that finish line right now. We are different than the way our focus was a few years ago.
Right now the natural resources based economy is really taking off. But it’s taking off in a different way than it has in the past. So when we’re looking at the forest economy it’s no longer, we’re only going to be using our forest to make paper. Now it’s, can our forests help provide biofuels? Can our fishing industry transition or adopt some more ideas in the world of aquaculture? And we’re seeing the growth of land based aquaculture. Again, that’s more coastal.
So it’s about looking at our traditional industries and trying to understand what does a 21st century viewpoint or view of those industries look like? How do companies reposition themselves? We’re also, I’m sure you guys have, I’ve got to assume at least you’ve had some folks in here that I’ve talked a little bit about the state’s workforce challenges.
Rich: Oh yeah. One or two.
Peter: Well the crazy thing is, and actually I heard this mentioned at an event I was at this morning, it’s not an issue just for Maine. I mean, it is a nationwide issue if not worldwide. I mean, we’ve heard, companies that have looked overseas can’t go overseas anymore because of the same type of availability of labor is not there, let alone here in the U.S. And what that’s led to is projects that have much higher capital expenditures, levels of automation that maybe don’t have to employ as many bodies at this stage. Which has been okay when we’re in a sub 3% unemployment environment.
What we’re seeing instead are companies that are taking the most modern technology, things right out of the lab, deploying them and trying to deploy them at scale. And it’s really an exciting time.
Rich: Wow. So you’re talking to these companies, and with the understanding that different companies are going to respond to different stimuli because they’re going to have different interests. What are some of the arguments, generally speaking, do you make for succeeding in Maine? How are you selling the state?
Peter: Well again, it depends on the person, it depends on the company. But if we’re talking again to Boston companies, if we’re using that strategy I mentioned that we hit really hard a few years ago. You know, it’s a couple of things. One as an entrepreneur, if you’ve raised some venture capital, we are geographically close and while it might not necessarily be a rational thought, it is almost always more comforting for an entrepreneur if they’re going to expand to be in a place where if that hits the fan, I can jump in my car, get there and fix it.
So doing an expansion that’s geographically close in a place that you’re likely familiar with provides a level of comfort to an entrepreneur. Because what they’re being charged with after they’ve received some equity investment, they’re being charged with managing their growth. And that’s a really hard thing to do and it’s an incredibly important thing to do. So those kind of softer things that you’re able to do to make that easier play a big role.
Rich: So obviously we often hear about the work/life balance in Maine, or the outdoors is a big thing. Is that something that some entrepreneurs and business owners care about, or is that something you’re like, well, that’s nice in the brochure, but no one’s ever going to move their business because of that?
Peter: I’ll say it again, it depends. It depends if the entrepreneur himself or herself is moving with the company.
Peter: Most projects that we work on, they’re not. But you know, I’d be lying if I said it never happened where somebody made a decision to put an expansion close to where they had their summer home.
Rich: Right. Or their ski chalet.
Peter: Right, or their ski chalet. Both are examples of things that have happened in the past.
Rich: So just following up on that, I’m just curious, do you go after Maine residents Maine graduates who have moved away? Like, do you go through the Colby alumni paper and be like, who started successful business out there that might be willing to give back to the state?
Peter: Oh, yeah. To the degree I’m allowed to. I’ve banged on the alumni directories of almost every school in the state. And as you might imagine, they’re not all eager.
Yury: To come back?
Peter: Yeah. Well not only that, but the schools themselves aren’t eager to give out contact information for people to get cold called by little nonprofits. But yeah, we’ll try to keep an eye on what we read, we read the Boston newspapers pretty religiously to find out whose growing, who’s investing in what company. And you’d be surprised there are a lot of people when you look at that model that have a big interest in being a part of the Maine economy.
It’s not easy. It’s not easy anywhere. I mean, let’s be honest, building, growing a business, it’s a lot of challenges after challenge after challenge that you have to figure out a way to overcome. And there’s a lot of competition out there. And we think that we’ve got, if we look at Maine as an opportunity, we think we’ve got a way when we talk to people that might be a little bit more manageable here than in some other places.
Yury: Well these are the positives of starting or bringing the business back to Maine, or just transitioning to Maine. But what are the challenges, what are the arguments against doing it?
Peter: There’s not a single argument. If you want to be successful, you come here. No, I’m only kidding.
Rich: I’m sold.
Yury: Case closed.
Peter: No place in the world is perfect. Every place has their pluses and minuses. That’s why we like to focus on what it is that a business needs. So we’ll look at, I mentioned a few minutes ago that we’ve been doing a lot in the world of aquaculture. And these are, you know, we’ve worked on a project that wants to put a $400 million operation in Belfast. Another one that wants to put $110 million in Jonesport. And the reason that they want to do that is because they need access to the Northeast market. And that’s something that’s really important because maybe you know that, you know, 90% of all the seafood that comes into the U S is imported. It’s flown in.
Rich: Did not know that.
Peter: Yeah. Crazy.
Yury: News to me.
Peter: Yeah. And so the idea that now we will have our own domestic supply of seafood, especially salmon, that we can supply to the Northeast market right here for Maine is incredibly lucrative and powerful.
So when we talk to companies, do we have certain challenges? Yeah. But can we overcome them by other things that are intrinsic to our area? That’s what we try to focus on.
Rich: Well, and along those lines, like one thing that we’ve heard more than once on this show is the fact that once you get past Southern Maine, connectivity to the internet can be a problem. So if a company’s looking to come to Maine but connectivity is a big issue and they’re looking to be further up North, does Maine & Co. get involved with helping them make that connectivity? Not ‘grease the wheels’, because that sounds dirty, but lobbying or just…you know what I’m saying? Like do you ever get involved with that component of it or is it more like you’re painting the picture of why Maine is a good place and then everything else kind of like is up to the company to assess and decide?
Peter: We would love to be in the position where…
Rich: I was sure this was going to be an, ‘it depends’ question.
Peter: We would love to be in a position where we can bring someone in and everything goes swimmingly, but that’s rarely the case. We work with the company forever, for as long as they want us to work with them. Everyone’s going to have challenges, especially when you’re talking about investments of the size that we’ve been seeing over the last few years. So yeah, we will work with an advocate on behalf of our client to the highest levels of government that we need to if necessary, or it might not even be the government, it’s to another company.
What we think is great about the way that we work, taking a step back, the way we are funded is by our private sector board of directors. I’ve got about 30, 32 members that financially support our organization and they just tell us to go out and try to encourage companies to come to Maine.
And what that brings, in relation to the question that you asked, what that brings is I’m immediately able to open up an entire network to people. So when a company comes in and talks about they’ve got challenges with broadband or they need to talk to a business or access to financing, we can turn those hundred phone calls that a new company to the area would have to make to find those right people, we can turn that into one phone.
So we’re able to open up that network to help a company solve any of those problems that they are inevitably going to run into. And frankly, anytime if you or I wanted to set up a coffee shop in Boston, we’re going to run into somewhere something unexpected and how are we going to solve that.
And when we work with the company, they know that they’ve got access to a group of, of decision makers and folks that know how to accomplish things. We like to say that we bring the mores of the private sector into a nonprofit economic development world, and we help people get things done pretty quickly.
Yury: On your website I look at the different company sectors like your success stories, and quite a lot of them are actually tech companies, which, which to me personally, it’s very surprising. Any particular reasons for why you were succeeding in the tech sector?
Peter: Yeah, I mean, tech companies are frequently venture backed and they’re told to grow. Just grow.
Yury: That sounds fairly simple.
Peter: It’s not super complicated. Oh, who was it? Was it Willie Sutton that said, “Why do I rob banks? Because that’s where the money is.” You know, our goal is to find companies that are growing and we’re not looking for companies that are on their last leg that have nothing left and are looking to find a big incentive package to save them. We just don’t operate like that. We try to find good employers that are in a great position to grow, and show them that that growth… Maine can be a part of their company’s growth strategy.
And we argue that at the senior leadership and board level for companies. So it’s not just about, “Hey, I need more people, where should I go?” That’s not just folks who are looking for the popular term a few years ago – or maybe might be dating myself – was this concept of labor arbitrage. You know, hey, we’re paying, we can get the same skills someplace else for less. I
t’s companies that have a smart, thoughtful growth plan and you’ll find that those are usually those tech companies with some sophisticated investors behind them that are asking, how are we going to grow so that everyone can make their investment back, the company can hit all of its financial goals, maybe hit an IPO, whatever it is that they’re looking for. Our goal, our job is to show them how Maine can fit into the deepest levels of their business plan.
Rich: I’m glad you brought up incentives because I was curious about the role of incentives in attracting businesses to Maine. You know, there’s been a lot in the news about cities and states falling over themselves to attract the new Amazon headquarters, several years ago now. But what are your thoughts on that? I mean it sounds like you are not about incentives at all. Is there any role for incentives here?
Peter: There is. And we’re also a pragmatic organization. We’re not a public policy group. We always joke or say a little flippantly, we’re where sales and marketing folks and we sell whatever’s on the truck. And we haven’t been given a ton of incentives on the truck. We’ve got a pretty good little program called the Pine Tree Zone Program, and some companies have used that incredibly effectively.
What’s great about that program is its thoughtful and very conservative and a company won’t receive the benefits until they have the job creation. So it’s a very thoughtful, metered out approach on how to do it. Was it going to move the needle when Amazon was looking for their corporate headquarters? No. But wasn’t designed to do that.
Rich: Right, exactly.
Peter: If our legislature and state government decide that they want to engage in the incentive game, we’ll art selling that if they put that on the truck. Now of course, we’d always like to have a few more tools or some extra stuff on the track.
Rich: Something up your sleeve, at least, that you can pull out at the last moment.
Peter: Right. Right. But, you know, we’re a very resourceful group. We’re small, we’re nimble, we’re incredibly opportunistic and we feel that right now our strength is in our ability to develop a relationship with decision makers, understand what’s important for them and then deliver.
Now there are some companies that will come to us and say, incentives are important to us and we’re not going to go anywhere unless we get a big incentive package. We don’t usually compete as well for those projects. We do better in our current state if we’re only doing a spreadsheet analysis and you take the name of the location off the top and they’re going to go with whatever spreadsheet in the lower right hand corner has the biggest number. That’s not the place where we do well.
Yury: But it really sounds like banking, you know, like you look at rate shoppers, those type of customers tend not to stay for a long time because they’re there for different reasons. And when you actually focus on what’s truly important to the businesses who want to succeed outside of the incentives, they’re the ones who tend to come in and stay for a long and deliver on their own expectations with the help from your company.
Peter: And that’s a great way of putting it. You can’t look at incentives as making a bad deal into a good deal. The deal itself has to work for everyone and then make sense. And then the incentives can help maybe close it, maybe break a tie or something like that. But it’s not, the cliché in the economic development world is incentives will never turn a bad deal into a good deal. And that’s on the client side as well. If a company knows that, “Hey, they don’t have the workforce that we need, or they don’t have the infrastructure that we need, but the state’s giving us a big check”, that company is probably not going to be successful.
Yury: Peter, quick question on Governor Mills. You know she recently laid out her new strategic plan – and all politics aside – what are your thoughts and how might this impact your work?
Peter: Well, when we heard that she was going to be doing this, and we feel very fortunate that the Commissioner of Economic and Community Development sits on our board of directors at Maine & Co., when she let us know that she was going to be leading this effort, its impact was pretty profound in that we said as we transition from one governor to another one administration to another, and we’ve done that a couple of times when we went from the King administration.
It’s really funny. We went from the King administration and Independent, to the Baldacci administration and Democrat, to the LePage administration and Republican, now to the Mills administration and Democrat. As a little aside, we’re pretty proud of that, that we’ve been able to do well no matter what party was in power. And every time there’s a change in administration, you have to reevaluate your strategy.
So as we’re kind of reevaluating our strategy, we hear that now that the Governor’s going to engage in a 10 year economic development strategy, we should use that when it comes out to help influence how we’re going to go forward. And so I think in that way it’s had an impact in helping us decide where do we look and what do we work on. And though those types of discussions, which are happening now at the board level at my organization.
Rich: And it sounds like it gets back to, you’re going to sell what’s on the back of the truck.
Peter: We’re going to sell what’s on the truck.
Rich: So I was interested to hear about how many business people are sitting on your board, because part of me wonders like, do businesses in Maine want all these outside businesses coming in. And you know we do have this workforce shortage, but it sounds like they’re actually looking forward to bringing in more businesses to the state Can you speak to that?
Peter: Absolutely. Everyone on my board, everyone associated with Maine & Co. believes that the more good companies you have investing in Maine, the better it is for the long term. And that’s just something you have to believe at the most intrinsic level of your company. You know that having a company come in, put money to work in this state, expand the state’s gross domestic product or gross state product, is going to be overall a net benefit.
Might there be a short term jolt in some of the hiring? Yeah. But in the end, the ability to have more companies here, more investment here as a state, everyone that is affiliated with Maine & Co. believes we need more private investment happening here. And that’s what we’re about. And when we can make that happen, the companies, I can’t say enough good things about the members of my Board of Directors – and not just because they sign my check – but these are companies that have put their own skin in the game, both in hot economic times and in slow economic times. So say we’ve got to look beyond our borders and increase the investment coming into Maine. The truth of the matter is, we’re not making enough little Mainers to be able to sustain ourselves on our own. We’ve got to be importing more ideas, more capital, into the state.
Rich: I did my part, I just want to say.
Yury: Well right now I think it’s a perfect opportunity to ask this question. So Peter, if you could change one thing to improve the business ecosystem in the state of Maine, what would it be?
Peter: Well, that’s a fabulous question because one of the things I would have said just happened this morning.
Rich: Get a $100 million investment?
Peter: Exactly. The Rue Institute in conjunction with Northeastern University. I mean that would have been maybe one of my top two or three.
Rich: Somebody took your answer is what you’re saying.
Yury: They anticipated that.
Peter: I mean that’s going to have a profound ripple effect for generations to come, I believe here in the state of Maine and not just in Portland there.
Rich: I’m glad I just locked down my lease this morning, by the way.
Peter: The other thing though that I would add is, and we’ve touched on this a little bit, as we’re looking at companies that are putting in and looking to deploy new technologies, it’s going to create – and we’re starting to see some of this now – it’s gone create challenges for our regulatory bureaus to keep up with the changes in technology.
They’re going to be asked to do things. You look at something Moore’s law and the rate of change that’s associated with that. They’re going to be asked to review and to permit and to understand things at an incredibly rapid rate. And it’s not an issue just here in Maine, it’s going to be an issue all across the country. But the ability to quickly understand and have a regulatory regime that can somehow respond to the fast changing nature of technology.
And I don’t know any state that’s really done this, but I’d love to be the first state to truly figure that out, to say this is an idea that we hadn’t thought of, it’s going to have a dramatic impact, let’s figure out how to permit it and regulate it in a fast, smart, efficient way that protects our environment and allows for economic growth.
Rich: Great answer.
Yury: Fantastic, thank you.
Rich: Peter, this has been fantastic. I really enjoyed learning more about Maine & Co. If people want to learn more about Maine & Co., or if they want to connect with you, where can we send them?
Peter: Send them to my website, https://maineco.org/. All of our contact information is there. Always feel free to connect with me on LinkedIn. You can also send me an email and that email address is email@example.com. Be happy to talk to anyone.
Rich: Fantastic. Peter, thanks for stopping by today.
Peter: Great. Thank you guys.
Yury: That was awesome.