Bethlehem, Pa.: A great place to “live and launch”

Lehigh University, like much of Bethlehem, has thrived in the shadows of 17-story blast furnaces and other industrial relics leftover from the once formidable Bethlehem Steel Corp.
That company may have closed its doors in 2003, but its pioneering spirit still lingers in a community determined to reinvent itself as a creative hub and technology center.
Lehigh has long helped lead that charge. An integral part of Bethlehem’s Southside community since 1865, Lehigh has been a linchpin for the region’s economic and cultural resurgence—a relationship years in the making.
This month, Fortune Small Business magazine, in conjunction with CNNMoney.com, paid tribute to that historical partnership in naming Bethlehem one of the “Best Places to Live and Launch.” The article was featured as the magazine’s cover story in its April 2008 issue.
Under the headline, “100 great towns that will feed your soul and nurture your business,” the City of Bethlehem claimed the No. 58 spot in the rankings.
“Bethlehem, once the Lehigh Valley’s steel capital, is now bustling with tech and biotech start-ups, thanks to resources stemming from Lehigh University and health care centers in the region,” writers Fortune reporter Peter MacDougall. He also credits Ben Franklin Technology Partners, an internationally-recognized program affiliated with Lehigh, for providing additional resources and know-how for start-ups throughout the region.
The brain gain
The ranking of Bethlehem came unexpectedly for some, according to the cover story. But to those who have followed Lehigh and the redevelopment of Southside Bethlehem, the honor was a long time coming.
“As a university, we think our most important contribution to economic and community developments is our talented people—especially our students,” says William Michalerya, associate vice president of government relations and economic development.
“Lehigh has really played a leadership role in helping to generate an educated workforce and contribute to the ‘brain gain’ of the Lehigh Valley by creating new technologies and new companies that attract investment,” he adds.
A strong network of community partners has also made that possible. The Ben Franklin Technology Partners, a subsidiary of Lehigh that is now celebrating its 25th anniversary, has provided start-up space in its award-winning incubator to more than 40 successful companies. These companies have together created more than 2,800 local jobs and, last year alone, generated more than $560 million in revenue.
Likewise, Lehigh and the Southside Bethlehem Keystone Innovation Zone (KIZ) garnered national attention when it earned the Award of Excellence in Partnership Development from the University Economic Development Association.
The KIZ program is administered by the Lehigh Valley Economic Development Corporation and is based on the success of the Ben Franklin Business Incubator, its partnership with Lehigh University, and the creation of Technology Centers on vacant Bethlehem Steel property with the City of Bethlehem and other economic development partners.
“The relationships and synergies developed in the Southside Bethlehem KIZ help keep new Lehigh graduates and other budding entrepreneurs right here in Bethlehem,” says Chad Paul, president and CEO of Ben Franklin Technology Partners.
“Our collective success in building Bethlehem’s economy is not by accident,” he says. “We make targeted investments in early stage technology firms and established manufacturers to create and retain long-lasting, family-sustaining jobs in our region.”
A business-friendly environment
Michalerya, Paul and community leaders announced the ranking at a press conference last week organized by Bethlehem Mayor John B. Callahan, who spoke of Lehigh’s commitment to Bethlehem’s Southside redevelopment efforts.
“[Lehigh’s] timing could not have been better, because their involvement and profile in Bethlehem increased just about the same time as Bethlehem Steel’s was decreasing and eventually disappearing,” Callahan said.
“Because of Lehigh University, along with the city’s other fine institutions of higher education—Moravian College and NCC-Southside—we have a community that is full of innovation, creativity, and most importantly, great potential and knowledge.”
Other event speakers included Anthony Iannelli, president of the Greater Lehigh Valley Chamber of Commerce; Secretary Dennis Yablonsky of the Pennsylvania Department of Community & Economic Development; and Mike Gausling, managing partner of Originate Ventures.
The event was held just a few blocks away from Lehigh at Victory Firehouse, new home of Originate Ventures. The venture capital investment firm is the only one in the state outside of Philadelphia and Pittsburgh, and provides resources and financial support for early-stage companies in eastern Pennsylvania.
--Tom Yencho