Right Place learns from small business relief collaboration

Economic developer saw vast need among local businesses, but heard expansion plans, too.

During a meeting of the Kent County COVID-19 relief subcommittee, The Right Place Inc. presented an overview of the its Small Business Grant program as well as an update to its own COVID-19 response.

According to an earlier Business Journal report, Right Place in late March received $1 million in grant funding from the Michigan Economic Development Corp. to distribute over an 11-county area. The amount came in under Right Place’s requested $1.5 million.

The eligible area included Barry, Ionia, Kent, Lake, Mason, Mecosta, Montcalm, Muskegon, Newaygo, Oceana and Osceola counties.

The allocation for Kent County was $615,700, or about 62% of the funding, said Tim Mroz, Right Place senior vice president of strategic initiatives, and added the allocation was made specifically by the MEDC.

In terms of a response, Right Place was surprised to receive 3,300 applications in just four days, amounting to over $71 million.

“After we separated everything by county, Kent County received about 3,500 emails, which totaled about 2,600 of those … applications,” Mroz said. “To use the word ’inundated’ would be an understatement.”

Every county established its own review committee. The review committee for Kent County consisted of representatives from Right Place, Grand Rapids Chamber, Local First, Downtown Grand Rapids Inc., West Michigan Hispanic Chamber, Grand Rapids Area Black Businesses and other local interest groups.

“Each one of them graded at least 278 applications individually,” Mroz said. “To eliminate bias, each application was graded multiple times by multiple people, and then those scores were averaged.”

Ultimately, 62 grants of up to $10,000 were awarded to Kent County companies, totaling about $615,000.

“These were not to stabilize the business at all,” Mroz said. “This was an emergency short-term injection of up to $10,000 per business, just to get them through the next couple of months.”

The application from the MEDC did not indicate a checkbox for applicants to declare whether they were minority- or women-owned. Mroz said Right Place was warned to be careful with earmarking public funds for such designations. Nonetheless, Mroz was proud to say 35% of the 62 grants were awarded to either minority- or women-owned businesses.

Mroz said Right Place conservatively estimated it put in just over 650 hours, or $72,000 worth of work into the program for the 30 days it was active, with an internal team of 11 people.

Commissioner Jim Talen asked Right Place if it would run the program again if it had a new pot of money with money for additional administrative costs. Right Place President and CEO Birgit Klohs bluntly said no, arguing the task was outside of the organization’s core competency.

“We were honored to do this because the governor asked, the MEDC asked, but giving grants to a small beauty parlor in Newaygo is really not where we are good,” Klohs said. “Would it have been something we’d have taken on without the MEDC? Probably not.”

Klohs said the Grand Rapids Chamber is the go-to small business organization, and it already has raised $1.3 million privately.

“Our core competency is making sure the manufacturers, IT companies, food processors stay in business so they can provide the jobs that eventually feed into the fact that you can go shop at the Cheese Lady on Fuller,” Klohs said.

She added, however, Right Place collaborated extremely well with the chamber through the grant process. With regard to the $70 million in grant requests Right Place could not serve because of limited funds, the organization made sure there was a pipeline through which businesses that missed out on the MEDC grant could receive assistance from the chamber.

“The state had $10 million for all 10 regions, and if you think about that we had $71 million of requests, there’s still a great need out there,” Klohs said.

To kick off her update to Right Place’s COVID response, Klohs gave the dire figure that the unemployment rate in Michigan was 22.5% at press time, but Klohs also revealed Kent County still is seeing expansions and inquiries for expansions.

The organization recently announced medical device packaging engineering firm Packaging Compliance Labs LLC will be expanding its current operations in Kentwood. In addition to a capital investment of $2.57 million, the company will bring 27 new jobs to the area.

The Right Place also has had eight or nine inquiries of companies that want to expand in the area in the next 12 to 18 months, Klohs said.

The Right Place has been a key player in diverting manufacturing capabilities to producing necessary PPE, as previous Business Journal reports highlighted.

When Spectrum Health was short on nasal swabs for COVID test kits, Eric Icard, senior business development manager for Right Place, connected with Keystone Solutions in Kalamazoo to produce 100,000 swabs.

Klohs added Icard also tapped Hex Armor, a provider of worksite PPE in Grand Rapids, to deliver 4,500 safety goggles to the Kent County Health Department.

Right Place also referred Hex Armor to three different agencies to find 100 workers to make face shields, Klohs said.

“We’ve had over 1,500 connections we’ve made through this business collaboration,” Klohs said. “It’s been an amazing experience … if I had to go through a crisis like this, I’d just as soon do it in this community.”

Mroz added Right Place has had over 1,700 individual company assists since March 18. Comparatively, the organization averages 100 to 250 in just a month.

“What we saw was four times what we’d do in a normal month,” Mroz said. “That’s the type of demand in the market right now.”

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