Scott Holland, owner of i-Lighting, displays a machine that allows him to complete circuit boards in-house. The company formerly imported from China.
It wasn’t just another business competition for Scott Holland, it was the realization of a life-long dream.
Holland’s startup i-Lighting, a novel easy-to-install indoor and outdoor LED lighting system, was awarded $100,000 and other prizes in April 2013 during the inaugural InvestMaryland Challenge, a prestigious business competition by the Maryland Department of Business and Economic Development. Following weeks of rigorous judging and mentoring, his company beat out dozens of others, ranging from high-tech manufacturers to smart phone app developers, in the general category.
The i-Lighting team celebrated victory at a ceremony with Governor Martin O’Malley, along with RedOwl Analytics, winner of the information technology category, and Graybug, winner of the life sciences category.
For Holland, it was only the beginning of a new life for the company he had been nurturing since 2005. Over the course of the following six months, by fall 2013, the company experienced rapid, profitable growth.
i-Lighting Growth Since InvestMaryland Challenge Victory
|Number of employees
||3 full-time and 2 part-time
||6 full-time and 3 part-time
|Location and work space
||Home-based 1,600-square-foot space with living room office
||Newly constructed 5,000-square-foot office and warehouse space
|Annual estimated calculated and projected revenue
||$500,000 in 2012
||$1,000,000 in 2013$3,000,000 in 2014
|Commercial product lines
|Number of manufacturing machines
|Parts production outsourced to China
i-Lighting offers a novel indoor and outdoor LED lighting system.
Pre-competition, a major challenge for Holland was convincing a bank to help finance his business. He was deeply passionate about his product, but knew he needed a jump-start.
“As a small business, it’s virtually impossible to just borrow from a traditional bank. They don’t want to take the chance,” he said. “But the cash injection from the InvestMaryland Challenge gave us the funds we needed to basically take us over the hump. That was a major hurdle we overcame after winning.”
But i-Lighting’s win offered far more than the cash prize.
“The exposure has been phenomenal. We weren’t known before. Now everyone knows about us. We gained legitimacy. Sometimes home-based businesses are looked down on. Having our own facility now, we’re able to entertain clients,” Holland said.
But one of the greatest benefits of participating was how it forced the young company to streamline its goals.
“Our business plan was mostly in our heads. It was on paper but it wasn’t highly refined. In order to qualify and compete, we had to create an actual realistic business plan. It forced us to focus and develop that plan. Now we’re implementing what we developed—and that’s huge,” he said.
Holland is especially proud of the fact that his company is no longer dependent on Chinese manufacturing. While it represented a substantial up-front cost to the company, Holland purchased a new machine that allows circuit board production for the lighting system to be completed in-house. He described the independence and reliability of using his own machinery as liberating.
“Not everything made in China is poorly manufactured, but it’s true that you get what you pay for … You don’t have control over quality, you can’t see your product being made, so you don’t know the environment it’s being made in,” Holland said. “The initial basic product might be cheaper, but by the time you pay expedited airfreight, it’s extremely expensive, and you also have to pay duties and taxes for importing it. At the end of the day, we have control and I can deliver a better quality product to the market, almost always cheaper, and I can place ‘Made in the USA’ on it.’ ”
Holland urges other startups, whether they’re already located in Maryland or interested in moving to the state, to submit their applications for the second-annual 2014 InvestMaryland Challenge.
“Even if you don’t win, it gets your name out there in front of professionals,” he said.
InvestMaryland Challenge applicants receive free admission to networking events, social media promotion, scoring and feedback from judges, and exposure to venture capital firms and angel investors. Categories have increased from three to four to include life sciences, information technology, cybersecurity and general industry. Each category winner is eligible for a $100,000 grand prize. Others will take home smaller grants, incubator space, consulting services and other cash and in-kind prizes, bringing the total available competition prizes to $600,000.
Applications must be submitted by Dec. 6.
Additional details and a video message from the governor are available on the 2014 InvestMaryland Challenge website.