It’s tempting to say they never had a chance, really, this upstart bunch that somehow was selected a finalist for Walmart’s U.S. Manufacturing Innovation Fund.

The idea for Rural Colorado Apparel Manufacturing, or RCAM, was strong, so the submission was eye-catching and in keeping with Walmart’s push to support domestic manufacturing. But last month, Walmart informed CSU’s Dr. Nancy Miller and Carol Engel-Enright, along with the RCAM team including its visionary, Julie Worley, that they didn’t win. Walmart’s selections read instead like a laundry list of academic exercises with tertiary ties to manufacturing.

Think it’s deterred the group from pushing forward? Think again.

“It’s a blessing we weren’t selected for funding,” Engel-Enright says, with perhaps a hint of disappointment. How far would $300,000 have gone in rural Colorado? A country mile. But Engel-Enright insists a clean break will force RCAM to act like a real business. To develop realistic budgets, to generate revenue, control costs, and be accountable to investors.

As with any startup, it won’t be easy. But RCAM is one of a number of grassroots efforts aligned with the region’s incredibly active apparel and lifestyle business ecosystem, in this case intent on reconstituting a U.S. cut-and-sew workforce decimated by decades of offshoring and neglect, to keep jobs here instead of shipping more overseas.

Born from the 2014 Colorado Apparel Manufacturing Summit, Worley, a Phillips County economic developer, boldly envisioned that underutilized labor in the small towns of eastern Colorado could comprise a new workforce of sewers, assemblers, and finishers.

Enter RCAM. Today it’s more than an idea. RCAM-Wray center, in northeast Colorado, is up and running “in its third production run!” Engel-Enright states proudly, sewing long-sleeve T-shirts and hoodies with ‘kangaroo’ pockets. Today the Wray center employs six operators, led by Leslie Starks, who happens to have a fashion degree and acumen, it turns out, for the business side. “She’s caught on quick to industrial matters,” Engel-Enright says.

That RCAM-Wray is online — with centers in Julesburg and Ordway, Colorado, to follow — is testament in part to Engel-Enright’s unique skill-set, a combination of industry experience in fashion design and production, of owning and operating businesses of different stripes, of finding jobs for her fashion students in private industry and recently of a hard earned doctorate from CSU in education with an emphasis on design entrepreneurship. I tracked her down at CSU in early 2014 with the idea for a Colorado apparel manufacturing summit. It wouldn’t have happened without her.

Still, she’s realistic about the daunting challenge of developing apparel manufacturing infrastructure to compete with the Asian powers, in particular. “When it comes down to it, there’s no model out there, no blueprint to follow, to train a new generation of sewers and production specialists. We’re developing the plan and the process as we go,” she says.

That’s not to say the end results are also obscure. “We know the standard. We have to produce quality garments that measure up to the best in the world,” she asserts, but adds, “When do we know our efforts will translate into quality apparel? No matter how big the order, can we produce a quality piece?” More questions.

Early returns from the initial production runs and training sessions promise answers. “There’s no surprise about the quality of people we’re finding from these communities. They’re incredibly hardworking — we can’t get them to stop and take breaks!” she laughs. “But Julie and Darlene Carpio and others knew this would be the case. Rural America has so much to offer; there’s no doubt we can train a workforce to compete on an international stage if we’re smart about this.”

There are other needs — like equipment. “The Wray center’s working on knits, on flatlock machines [a sewing machine that creates a flat seam with the same appearance inside and out],” says Engel-Enright. “All three centers will have all the basics — straight stitch, overlock, and coverstitch. Julesburg is organized and investors are in place with deposits on equipment. We’re ready to go there when training and jobs are lined up.” But advanced cutting equipment and specialized sewing and finishing machines are much needed.

Without Walmart dollars, funding is the challenge. An Advanced Industry grant from Colorado’s Office of Economic Development and International Trade seems to fit the bill, but OEDIT views apparel-related business as a ‘Creative Industry’, not ‘Advanced Industry.’ The AI grant program is today under review; perhaps a revision will accommodate a wider cross-section of manufacturing industries.

All of which leaves Engel-Enright entirely unfazed. “These centers won’t replace Asian factories,” she says matter-of-factly, “but they will reduce barriers to entry for small business. A former student and budding entrepreneur told me, ‘What seemed insurmountable now seems possible.'”

Supporting a business-savvy academic would have been yet another benefit for Walmart, along with goosing domestic manufacturing and helping rural America ‘Live Better’.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com with questions or information about the 2016 Colorado Apparel Manufacturing Summit, September 28 in Denver, Colorado.

Here are seven manufacturing stories we’ll be following closely in 2016:

1. Craft beer’s pivotal year. Two key ingredients of Colorado craft’s successful formula — its specialty sales channel and local ownership — may be tipped over in 2016. How will the sector respond? In November voters will likely decide whether grocery stores and other retail outlets can sell craft beer and wine, a move opposed by much of the craft ecosystem including the state’s network of thriving small liquor stores. The craft sector may have lost an important ally in the debate with the sale of Breckenridge Brewery to Anheuser-Busch, and may lose more. With rumors of a billion-dollar sale of New Belgium swirling, 2016 may be the year that Colorado craft’s united front against ‘big beer’ finally cracks. To what end?

2. Welcome to the (food) revolution. Food brands and manufacturers here are leading a sea change in what we eat and how we grow, make, and distribute our food. Brands flock here to be part of the scene and local companies are targets for takeovers. It’s a poster-child for the new manufacturing economy – entrepreneurial, innovative, ‘Made in America’ — and a model other states emulate. It’s also the fastest-growing manufacturing sector in Colorado. Storylines should be plentiful in 2016.

3. Will McCain’s antics derail one of Colorado’s signature aerospace manufacturers? In a pique over Ukraine, Arizona Senator John McCain led a congressional effort to ban the use of Russian RD-180 rocket engines used by Colorado aerospace manufacturer United Launch Alliance. As the company maneuvered around the politics McCain made it his personal mission to vilify ULA, one of Colorado’s signature companies. Alabama senator Richard Shelby fought back (ULA assembles its launch platforms in Alabama), securing more RD-180s as part of the 2016 federal budget. But is damage done? With dozens of government-funded launches planned in the near future, and ULA competitor SpaceX seemingly more viable than ever, it’s a good bet McCain will do everything he can to undermine ULA. Will Colorado senators, silent to this point, join the battle on behalf of a Colorado manufacturer?

4. Local sourcing: a new supply chain may light a fire under lifestyle manufacturing. Quiet but important grassroots efforts are underway to develop new supply-chain options for lifestyle and consumer brands — like a rural network of cut-and-sew centers. And why not? The region is a magnet for outdoor gear and apparel companies, for smart, visionary entrepreneurs with ambitions to launch and develop lifestyle companies. We seem far away, though, from a world-class supply chain that might actually begin attracting gear, apparel, or other consumer OEMs to Colorado. But small steps are important. And people are starting to get it.

5. What return on taxpayer investments in manufacturing? In addition to the space program, federal taxpayer dollars are flowing into the state to fund other programs designed to benefit manufacturers. Millions have already been spent on workforce development. CAMA’s FourFront initiative will spend $6.6 million in support of defense diversification and innovation. The City of Loveland, Colorado School of Mines, Manufacturer’s Edge and others will be investing taxpayer dollars in support of manufacturing. The initiatives hold promise but more government spending means higher taxes and with business over-regulated as it is, manufacturers reasonably expect to see tangible benefits in 2016 from the spend. (John Tamney’s brilliant Forbes column provides the backdrop.)

6. Pot’s impact on manufacturing. It almost goes without saying, but Denver’s future as a modern urban manufacturing center may hinge on the availability of affordable commercial real estate. Pot grows have radically changed the market. It’s bad form to root for the real estate bubble to burst, so instead, let’s hope the price of marijuana goes the way of oil and crashes, leaving pot businesses less well-heeled and the market less inflationary. It’s actually a good bet. If it happens we’ll remind you we told you so.

7. The rehabilitation of manufacturing’s brand — or not. Last year we chronicled the national debate regarding a U.S. manufacturing ‘renaissance’. By year’s end, the dialogue was less a lively back and forth and more a rout: Most business writers, like Jon Talton of the Seattle Times, had effectively buried the idea of a manufacturing ‘comeback’ in the bottom of a $40 barrel of oil, alongside a strong dollar hammering U.S. exports, or relative to manufacturing employment numbers from circa 2007, before a recession bludgeoned a sector already reeling from a wholesale offshoring of jobs.

To be fair, the reimagining of manufacturing is lost on local media as well; Colorado scribes often can’t identify a manufacturing company when they see one. It’s also hard to be critical of critics when manufacturing’s own advocates lose sight of the issue. ‘Re-branding’ was once a stated objective of manufacturing trade efforts. Today, not so much.

Our story is that manufacturing employment has returned to pre-recession levels in places like Colorado and Utah and that jobs are being created in a sector reinventing itself with technology and driven by consumer and business trends that today favor more locally produced goods. High-tech fabricators in aerospace and biomedical and food and beverage manufacturers will blaze a way forward. The future’s bright.

We’ll stick to it in 2016.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com.

We write often of Colorado’s powerful craft food and beverage sector, but last week’s news of Pinnacle Foods acquisition of Boulder Brands for nearly a billion dollars was an eye-opener.

The $975 million price tag, including $265 million in debt, is 29X net earnings (EBITDA), a staggering multiple, especially for a company that’s struggled lately to maintain sales ‘velocity’ for some of its brands. In early summer, when Boulder Brands announced that Stephen Hughes, the company’s CEO, would be leaving, analysts assumed the worst, at least in the short term. TheStreet’s David Peltier said this:

“You certainly don’t want to step in and try to buy Boulder, where the previous CEO left on a sour note. It will likely take a few months to find a permanent replacement, the core Smart Balance brand is not performing well and the steam has come out of the expected growth of its gluten-free brands. . . . The company is no longer a growth story and even though the stock has fallen 36% so far this year, at north of 20X expected full-year earnings, it isn’t cheap enough yet to attract value investors.”

Right. So why the huge deal?

Certainly Pinnacle covets a newer more progressive portfolio, featuring more gluten-free, natural, and organic brands. Boulder’s the national epicenter for innovation and brand development in the sector, so on one level it’s no surprise for those paying attention.

“The conventional players understand they have to evolve or get left behind,” says Ross Shell, CEO of Boulder-based Red Idea Partners, a venture firm focused on early-stage natural food companies. “The valuations on these transactions may seem high, but these deals are based far more around future growth expectations. The hope is that the growth potential plays out handsomely over time to justify the valuation,” he explains.

But a billion dollars worth of healthy burritos and gluten-free spreads? Wow. Are we seeing Colorado’s influential sector reach a tipping point, where the quiet innovation that’s been ongoing here suddenly translates into a string of mergers and acquisitions with heady valuations like the Boulder Brands deal?

Bill Capsalis, president of influential trade group Naturally Boulder, doesn’t go that far but agrees with the premise. “We can expect to see more of this type of activity in the near future,” he says. “This investment validates what we’ve known for a long time – that there’s a food revolution going on.”

It’s also a very active M&A market; deal-makers describe it as ‘frothy’. And while 30X deals are the exception, today it’s a seller’s market for companies with a healthy balance sheet, regardless of sector.

Frothy or not it’s a good guess that Colorado’s transcendent food sector is set to reap the benefits of at least a decade of incredible creativity and entrepreneurship. And craft beer may be next.

Of course, the big difference is that no major brand from Colorado’s first movers has yet to be fully acquired. Oskar Blues created a stir several months back by divesting a controlling interest, but details remain very closely guarded. The community is so tight that the fear of blowback from ‘selling out’ remains a barrier. For many, the tie that binds craft brewers to loyal customers is local ownership.

But consider the multiples that may be in play. Last year a Wall Street Journal article theorized that craft-beer makers are worth roughly $1,000 per barrel of annual production, a number as gaudy as 30X EBITDA. And that was a year ago. The craft beer movement has accelerated at least as fast as the natural and organic trend — and the big craft beer brands arguably carry more weight than those in food.

Is New Belgium a billion-dollar brand? At $1,000 per barrel, it will reach that threshold this year. At that rate, Colorado’s beer landscape is also littered with $50 million and $100 million craft brands, from Oskar Blues to Odell to Left Hand to Breckenridge to Great Divide.

But as much as AB or Molson Coors would like to emulate Pinnacle Foods, we’ll likely be waiting a good spell to find out.

Bart Taylor is publisher of CompanyWeek. Reach him at btaylor@companyweek.com.