ALPHARETTA, Ga. — City leaders are calling on Tech Alpharetta to deliver a clearer picture of its goals and an accounting of its return on investment as the government-supported nonprofit heads into a new year of operation.
The request came Dec. 17 as the Alpharetta City Council appropriated $18,700 in additional funding for the enterprise to cover administrative costs through June 2019.
For the past three years, the city has appropriated $125,000 annually to Tech Alpharetta through the Alpharetta Development Authority. In addition, this year, the city contributed $25,000 in sponsorship for the organization’s Ag Tech Conference of the South held in July. The city stepped in again to cover shortfalls when the Ag Tech Conference proceeds fell short of expectations.
This latest funding from the city comes with the caveat that the nonprofit report back with a roadmap to how it defines success and how it provides a return on the investment of taxpayer dollars.
“I’d like to see some understanding of what the deliverables are, and they send them to us so we can have this discussion of what the future of Tech Alpharetta is,” Councilman Jason Binder said. “I think it’s been a great story. I think probably all of us are in support of it… But we need to come together on a discussion of what Tech Alpharetta’s going to grow to be.”
Tech Alpharetta’s funding had been scheduled to end in February. The additional funding will carry it through to June, when the city considers its fiscal year budget.
City Councilman Ben Burnett said this stop-gap fix will align the funding requests with other requests the city weighs during the budget process.
Tech Alpharetta sprang from the city’s creation of the Alpharetta Technology Commission in 2012. The commission consisted of a strategic advisory board of local tech executives charged with identifying and promoting key investment opportunities for the local technology sector. The commission was granted nonprofit status in 2015 and changed its name to Tech Alpharetta in 2017.
In addition to its work promoting the tech industry and advising the city on tech-enhancing policies, Tech Alpharetta operates the Innovation Center where it provides guidance and assistance for startups.
It occupies space in the city’s former Fire Department headquarters on Academy Street. The city pays costs of building maintenance and utilities.
City Councilman Donald Mitchell said he’s worried Tech Alpharetta has fallen short of its understanding with the city that it develops into a self-sustaining operation that comes up with its own funding sources.
“I was on council when we started this,” Mitchell said. “We had every expectation that it would be up to par and that you all would be doing private funding as well. That really hasn’t happened.”
Tech Alpharetta CEO Karen Cashion told council members that the original agreement for funding with the city had been for three years with the hope that at that time the organization would have reached a point of raising its own funding base.
She said shortly after she joined as CEO in early 2017, ongoing conversations she and her board had with city officials indicated that self-sustainability was not attainable as long as the nonprofit ran an incubator operation.
“There isn’t actually a tech startup incubator in the metro area or in the Southeast that I’ve found that’s been able to operate, become financially self-sustainable without investor, corporate or municipal funding,” she said. “We’re subsidizing real estate for our tech startups in order to help them to grow and ideally succeed and move out into this community and grow their companies and their headquarters here.”
Cashion acknowledged that the conversations regarding self-sustainability were conducted with a city which now has a new mayor and at least three new council members.
She said when she first took the position, no fundraising had been done. Within the first eight months, she managed to raise $45,000. This year, a combination of sponsorships for the Ag Tech conference and other fundraising initiatives combined to bring in $103,000.
“It is a primary focus of what I do on a day-to-day basis is reach out and try and cultivate sponsorships,” Cashion said. “I continue to see that as obviously a critical and essential role to being able to continue the organization.”