When the Colorado Advanced Manufacturing Alliance launched Southern Colorado’s FourFront Fuse Impact Center at Catalyst Campus last year, one of the first programs established to give local companies a boost was the Defense Assistance Program.
Several local businesses that were affected by defense cuts and budget sequestration had the opportunity to apply for federal funding of $15,000 through CAMA, a Colorado trade association for manufacturing
Of 12 defense applicants, 11 companies were approved for DAP funding – and those businesses say they are reaping the benefits.
Four companies used the grant for market research; two used it for software training; three used it for strategic planning; one used it to be certified for the International Traffic in Arms Regulations and one used it for new capital training.
“We found the program extremely helpful because we’ve been able to expand our business overseas,” said Ed Baron, director of Braxton Technologies, who used the program for the ITAR certification, which helps businesses know which technologies that they cannot share with other countries.
In the past Braxton has primarily focused on doing business with the U.S. Air Force and other companies inside the nation. The voucher allowed the company to hire an outside consultant with expertise in its satellite command and control, and allowed the business to launch an export control program.
Through the process, Braxton registered with the U.S. Department of Commerce to license specific products.
Its export control program became operational last November. Braxton paid $20,000 and was reimbursed $15,000 through the program.
The money met an immediate need for Braxton, Baron said, because it needed to to expand internationally, but lacked resources to comply with federal law.
In recent years, defense cutbacks harmed the satellite management company. Federal efficiencies required by lower budgets drove the government to reduce requirements and Braxton didn’t deliver as many services to its government customers. In turn, its product sales and engineering services were in less demand, Baron said. Tight budgets at home meant Braxton needed to look overseas to continue its business model.
“It was extremely valuable to have an export consultant — which the program helped us find — to walk us through the export process and make sure we were doing it right,” he said. “It’s not a simple process, and if you do it wrong, the percussions can be pretty severe.”
Infinity Systems Engineering applied for the grant because the company was interested in diversifying its core capabilities, said Brad Michelson, vice president of business development.
“We’re not just wanting to focus on Air Force and [Department of Defense] commercial customers, but [we wanted to] also expand into cybersecurity and general IT services,” he said.
The defense contractor hired cybersecurity company PLEX Solutions for an independent assessment on its systems’ architecture and security controls, to make sure the company was compliant with cybersecurity standards issued by the National Institute of Standards and Technology.
“They tested our posture [and] phishing techniques and helped us progress to full compliance so that we can stay ahead of the game on commercial best practices,” Michelson said. “We want to make sure we’re doing the best internally and externally for our customers.”
Infinity was founded in 1996 has more than 200 employees, including subcontractors.
“The program and grant was valuable because it gave Infinity a good perspective on where we’re at in the industry and helped with compliancy,” he said. “Otherwise, we probably wouldn’t have paid for an outside assessment.”
All applicants went through an assessment process, that included interviews, evaluations and financial statements.
To make sure companies were financially stable, the Defense Department required applicants to initially pay the $15,000 for the program and then reimbursed them.
“These were all efforts to make sure these businesses had skin in the game and were fulfilling the purpose of the grant,” said Tim Heation, president of CAMA. “We wanted to help companies diversify, not putting a band-aid on something that wasn’t going to make it because of the cutbacks.”
Some local companies didn’t think $15,000 was worth the process, Heaton said, but the ones that competed for the grant said they found it helped them improve business.
The program is still open, and funding is available. Go to fourfrontco.com/defense-assistance-program1 to read the criteria and learn more about the grant.
“We have room for five to six applicants that we would love to get in the program,” Heaton said.
Sometimes all companies need is an incremental push to get them to do the market research or revamp their strategic plan, said Tatiana Bailey, executive director of the UCCS Economic Forum and director of the DAP.
“The only reason the state of Colorado has continued to do so well, and is typically top five in the nation for economic growth is because we’re such a diverse economy across the state,” she said, adding, “So clearly that’s what we want locally too.”
The military represents 17 percent of local employment, according to the latest 2014-2015 numbers, not quite as high as a lot of people quote, Bailey said.
“To any extent that we can help our locality diversify is key,” she said. “It’s absolutely key and isn’t going to only happen through the DAP. It’s going to take a lot of effort from different angles. It’s moving in the right direction and any little positive incremental thing that we can do for some of the smaller businesses that have been hit is a good thing.”
After receiving DAP funding, TMC Design is working on a commercialization study for a product it developed for the military, and Qualtek is changing its processes and procedures that will allow the company to move into medical device equipment.
Heaton, who has a background in manufacturing, said making those moves is valuable to the companies.
“Helping someone with certifications — or in the case of Qualtek where they’re actually getting a new process for their coding line — those are permanent steps,” he said. “Once you get those, as long as the manufacturer keeps up with requirements, those are sustainable transactions and they truly making change in a company.”