Soft Center broadens Duluth's port status from international seaport to technology port

By Mike McNamara
In mid June of this year, Soft Center International, headquartered in Sweden, will bring 15 European companies to Duluth to be introduced to approximately 30 United States and Canadian companies in an International Partnering Conference.

The conference will be the culmination of a 10-year effort, and the Soft Center concept, imported from our Sister City in Sweden, is on the brink of making Duluth-Superior an international information technology port, complementing our traditional role as an international seaport.

Soft Center has moved into Duluth’s new Technology Village, in the city’s downtown.

We’ll go back to the beginning.

In 1991, a study suggested that one of our targets to create 21st century manufacturing jobs be industrial controls. We discovered that industrial controls actually referred to computer software (a new industry at the time), with great potential. After forming TEAM Duluth, we first attempted to recruit software businesses into Duluth’s then-abandoned US West Building as a magnet in a project called the Duluth Technology Center. (TEAM Duluth was created in 1994 to coordinate economic development activities between the City of Duluth, Duluth Economic Development Authority, Duluth Area Chamber of Commerce, Duluth Airport Authority, Minnesota Power and the Duluth Seaway Port Authority.)

In 1995, one of our sister cities, Vaxjo, Sweden, invited the Duluth Area Chamber of Commerce to send a delegation to Vaxjo to talk about business opportunities. For years, Duluth and Vaxjo had been doing educational and cultural exchanges. Now Vaxjo wanted to look at the possibility of doing some international economic development.

Upon our arrival in Vaxjo, the delegation was surprised to find that our sister city was about 10 years ahead of us in technology development and had approximately 100 software companies. Our hosts in Vaxjo suggested that we include travel to two smaller cities, Ronneby and Karlskona, as part of our itinerary. Located on the Baltic seacoast about 80 miles south of Vaxjo, Ronneby and Karlskrona are, ironically, referred to as “The Twin Ports” — like Duluth and Superior.

In Ronneby, we found one of the premiere information technology projects in Europe — Soft Center — an ultra-modern campus with approximately 75 companies co-located with 1,500 software students. The director of Soft Center explained that their Twin Ports, like ours, had been dependent on a heavy industrial base and that years earlier that base, a foundry, had closed.
After two years of unsuccessfully trying to bring in other heavy industry, the community leaders decided to take a bold move into the future and began the work to create a software industry.

The Soft Center development in Sweden was everything we hoped our Technology Center would become. We asked Soft Center officials if they would be our mentors and — I believe because of the strong ethnic ties between Minnesota and Sweden — they agreed and sent us home with considerable information.

Further discussion followed and later an official partnership agreement linking the Duluth Technology Center and Soft Center Ronneby was signed. Yet, the major break came when Duluth Mayor Gary Doty, after hearing so much about the project, traveled to Soft Center Ronneby and asked the Swedes if they would consider franchising the Soft Center concept in Duluth. After nine months of negotiations, Duluth, with the help of the State of Minnesota, entered into an agreement to build a Soft Center.

During the same time, the University of Minnesota-Duluth (UMD) was also exploring the possibility of creating its own technology park. UMD developed the concept for the Duluth Technology Village, to be located on the block directly east of Lake Avenue on the north side of Superior Street in downtown Duluth.

Eventually the two ideas converged, and the Soft Center project was considered as the anchor tenant for the Duluth Technology Village. A&L Development’s proposal for the project was chosen from several that were submitted. On September 9, 1998, ground was broken, and now the finishing touches of this $36 million project are being put in place.

The critical three-tiered, school-to-work education piece of the Soft Center model is being fully developed by our local colleges and universities. UMD’s Center for Economic Development and the Lake Superior College Technology Center have located in the Technology Village. Seven technology companies, including Applied Interventions, eSystems21, Scan-Health, United Health Care, AppRight, DuluthSuperior.com and Saturn Systems have located there in addition to A & L Development and Smith Barney. DEDA has leased 10,000 square feet where the Soft Center offices, an interactive classroom and an incubator facility will be housed.

TEAM Duluth, which was hired to provide the executive function for Soft Center, is working with numerous other high-tech companies from outside Duluth that have a high interest in the project.

At the same time, TEAM Duluth continues to recruit information technology workers. Currently it has a database of approximately 400 IT workers who have expressed an interest in living in Duluth and working for Soft Center companies. Techies.com, a major player in the IT recruiting arena, has a database of approximately 500 workers — 100 with 10-plus years of experience who would like to relocate in Duluth.

Soft Center continues to expand with two new Soft Centers in Sweden and others being considered for England, Ireland, Scotland, Belgium and France.

Soft Center Duluth was presented with the 1999 global Bangemann IT Challenge award for its office campus in the Best New Business Structure worldwide category from the King of Sweden on June 9, 1999, in a ceremony at Nobel Hall in Stockholm.

Soft Center Duluth is also collaborating with another group in Vaxjo called Internet City, and companies within the facility are already working together on projects.

We are excited about our future.

Mike McNamara is TEAM Duluth executive director and Soft Center president.