Inside a plain brick building in Burlington lies the Vermont Center for Emerging Technologies, a buzzing hipster incubator that looks as if it could be in Silicon Valley. It is powered invisibly by forces that any city would envy: a green grid that is highly energy-efficient and a superfast one-gigabit internet connection.
“People would kill for this internet connection,” said Tom Torti, president of the Lake Champlain Regional Chamber of Commerce. “For us to grow our tech network, we needed to double down on fiber network.” The new Burlington economy is going to be knowledge- and skills-based, he added.
This digital superhighway runs through beautiful Burlington, a small city sandwiched between the distant Green Mountains and the 125-mile-long Lake Champlain. It is an outlier as far as emerging technology hubs and so-called smart cities go. But Burlington, which has a lower unemployment rate than Silicon Valley, is now spawning a wave of technology pioneers.
The technology center, called VCET, provides free advice, mentoring, seed money and gorgeous co-working spaces that are available to entrepreneurs for a low fee. Students can use these spaces free, so Max Robbins and Peter Silverman, 20-year-old college students, are starting their business, Beacon VT, there. It is similar to the dating site OkCupid, but for employment, matching students with employers.
“We’re trying to give people an unfair advantage,” said David Bradbury, president and fund manager at VCET. “There’s nothing too big that you can’t dream here. And the snowball is moving faster.”
An ultrahigh-speed internet backbone even helped Burlington form a partnership with US Ignite, which aims to build the next generation of internet apps, to form BTV Ignite. Its goal is to mindfully build on the city’s network and further innovation, said Michael Schirling, who heads BTV Ignite.
“Smart cities and new technologies have the potential to change everything,” said Mr. Schirling, a former Burlington police chief. “When you put in the right building blocks, you get a collision of ideas, which can become self-generating. It’s attitude and infrastructure. ”
A result is that Burlington, once a timber port, has a stunningly low unemployment rate of 2.3 percent. On the downside, the city is also experiencing a skilled-labor shortage; hundreds of coding jobs alone languish on job boards. Burlington was named a TechHire city by the White House in 2016 to help link local employers with local workers, and to help these workers get the skills they need for a fast-changing economy. The designation does not come with funding, but it does help Burlington get grants for free training.
The TechHire mandate in Burlington is to train 400 technology workers through 2020.
“We want younger people to know that there are career opportunities here,” Mr. Torti said. “We’re trying to grow our work force rather than importing it.”
A nonprofit organization known as Vermont Hitec is a crucial part of that vision.
It works in partnership with local companies to offer boot camps online and in classrooms that teach skills such as medical coding and programming that lead to good-paying jobs with benefits.
Vermont Information Processing, which develops software for the beverage industry, has been working with Vermont Hitec so that it can retrain or recruit employees as its business grows and it becomes less interested in outsourcing.
Colleges like the University of Vermont, which offers a biotechnology program, and Champlain College are also helping solve the employment puzzle. Champlain College offers degrees in high-demand careers like digital forensics and game programming, along with a special program for federal employees who can get online degrees in high-growth fields.
“We’re responsive, nimble and entrepreneurial,” said Don Laackman, president of Champlain College. “There’s a connection between employment needs and sources offered.”Burlington got its first push into technology start-ups when IDX Systems, a health care software maker, was founded there in 1969. It was sold to General Electric about 10 years ago.
“IDX created a lot of wealth and talent, and these people could be angel investors,” Mr. Bradbury said. “It was a tipping point.”
The next wave of innovation has come from internet companies like MyWebGrocer, which offers digital grocery services, and Dealer.com, which offers digital marketing services for the auto industry. Dealer.com became a legend in Burlington after it was sold for $1 billion a couple of years ago. Mike Lane, one of Dealer.com’s founders and its former chief operations officer, who is now on the VCET board, is an angel investor who has funded eight start-ups. One of his investments is Faraday Inc., which uses data analytics to help companies target customers.
“In the future, there will be several $50 million to $100 million exits here,” Mr. Lane said, “along with other larger ones mixed in.”
He credits Vermont’s community and socially conscious spirit with his success. “We didn’t buy the philosophy that we had to be in a hot spot,” said Mr. Lane, who returned to Vermont after working in Cambridge, Mass. “Even Zuckerberg realized that he could have been anywhere to build Facebook.”
That can-do spirit also inspired Marguerite Dibble, 26, who began her firm GameTheory while she was still a student at Champlain College. Its mission is to use gaming to inspire behavior changes, such as teaching teens financial literacy.
“In Burlington, I can call anyone and learn from their experience,” said Ms. Dibble, who was born in a small Vermont town with no ZIP code. “The degrees of separation are lessened here. There’s a shared Vermonti-ness.”
The energy to power GameTheory’s innovation comes from Burlington’s green grid, which is owned by the city. The state has long been one of the country’s greenest. But in 2014, Burlington upped the ante by turning only to wind, water and biomass to power the city — one of the first cities in the nation to do so. There are also incentives for reducing energy. Landlords, for example, can choose to have free energy audits, and more than 100 have done so.
Other Burlington businesses also work hard to save energy on their own. Seventh Generation, which makes environmentally conscious household products and was founded in Burlington, gives its employees bonuses for helping reduce greenhouse gases. Like many other companies in Burlington, Seventh Generation also aims to be socially responsible and was formed as a B Corp, which means it has to meet social, environmental, accountability and transparency standards.
With this focus on energy efficiency, the city’s electricity rates have not risen in eight years, said Neale Lunderville, general manager of the Burlington Electric Department. “And there are no rate increases on the horizon,” he said, “since we’re not chasing the next kilowatt-hour.”
Electric cars even have their own parking spaces with chargers.
Burlington will eventually become a net-zero city, said the mayor, Miro Weinberger. “Our isolation promotes a commitment to pride and place,” he said.
The city that helped propel Senator Bernie Sanders also has its own nonprofit urban farm called the Intervale Center. The land was once an abandoned dumping ground with old tires and cars. That space now contains 350 acres with bee hives, commercial farms, greenhouses and other projects. Through its food hub, local foods are delivered to area businesses and individuals.
Intervale’s farm incubator, a five-year program, even teaches new farmers the ropes, said Travis Marcotte, executive director of Intervale Center. “They then transition out of the Intervale,” he said, “So we’re spinning off whole farms.”
It is a hopeful message, Mr. Marcotte said.