Local business incubator Ann Arbor SPARK has expanded to help Ann Arbor technology startups grow and increase profitability.

SPARK has added a second stage to its incubation program, allowing startups a chance to advance from stage one after growing to four or five employees. The second stage allows companies to maintain support from the incubator until they reach 12 employees.

Bill Mayer, director of business acceleration at SPARK, said creating the bridge between the early beta stages of a new product and profitability from that product is very helpful for young companies — especially in Ann Arbor where space can be hard to find and is particularly expensive.

“It doesn’t make sense for a company for 12 months, especially a task for startups, to pay for twice the space they need hoping that they’ll grow into it,” he said. “Now we’ve grown the capacity of companies that we can house along their growth curve.”

SPARK’s new space on the third floor of its East Liberty Street building adds 2,500 square feet. He added that having stage two helps solve a space problem, with the stage one space becoming overfilled with rapidly growing companies. Stage two currently has three residents, he said.

Len Gauger, creator of Message Blocks, an event-planning service, is one of the stage-two residents. He said SPARK’s expansion has allowed him and his company to stay in Ann Arbor.

“Being involved in the stage two allowed us to continue growing our company without really chilling our bank account,” Gauger said.

While Gauger said an entrepreneur with a profitable idea is likely to be successful on his or her own, he said the SPARK program provided many crucial resources and connections he wouldn’t have had otherwise.

Engineering lecturer Moses Lee is the founder of another SPARK stage-two company, Seelio, which helps students create a portfolio of their work before graduating. Lee and his co-founders are all University alumni.

Seelio currently has 11 employees and is growing quickly, but Lee said SPARK has helped the company expand across the country.

“It allows us to focus in on operating our company and getting success and building the business and not having to worry about space — having to worry about the internet and coffee or things along those lines,” Lee said.

He added that SPARK is one of the many business incubators in Ann Arbor that are helping foster growth for the large number of startups in the area. He said Seelio will likely move into its own office within the next six to 12 months.

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