By Ed Felton
From the March/April 2016 Issue
The Innovate NY Fund is a seed stage business equity fund with up to $47 million to support innovation, job creation, and high growth entrepreneurship throughout the state. The Innovate NY Fund is supported with $37 million in State SSBCI funds and $10 million from Goldman Sachs, and is expected to leverage over $450 million in additional private investment for small businesses.
Eight investment entities were competitively selected to invest in technology companies and other high growth firms throughout New York State. All contracted investment funds are required to secure at least a 2:1 match from private sources on its aggregate portfolio at the time of investment. Innovate NY funding may not exceed $500,000 per investment or $750,000 in the case of any individual biotechnology related company.
Since program inception through year-end 2015, over $31 million in Innovate NY Funds have been invested in over 70 startup and seed stage companies across the State. This amount leveraged over $190 million of private capital investment.
This year, Innovate NY funding has been deployed to support four biotech companies expand operations in New York City. The Innovate NY program has partnered with leading life sciences investment fund, the Partnership Fund for New York City, to further advance an emerging biotechnology cluster. The Partnership Fund was awarded $2.8 million through Innovate NY to invest in TARA Biosystems Inc., Celmatix Inc., Lodo Therapeutics Corporation, and Petra Pharma Corporation, which was matched by over $21.5 million in private investment funds.
“New York Ventures celebrates innovation and discovery, entrepreneurialism, and a steadfast dedication to job creation,” said ESD President, CEO & Commissioner Howard Zemsky. “I am excited to see the biotech industry expand in the Empire State, and I look forward to the company’s significant contributions to the bioscience industry and local economy.”
“New York City has tremendous biomedical research assets, and this funding from ESD is helping to keep commercial spin-outs from our universities located right here in the city,” said Maria Gotsch, President and CEO of the Partnership Fund for New York City. “The State’s commitment to fill a funding gap for early-stage life sciences companies will pay dividends — it will create middle-class jobs and foster the growth of an innovative new sector in the city.”
Based on research from the laboratories of Columbia University Professor Gordana Vunjak-Novakovic and University of Toronto Professor Milica Radisic, both scientific co-founders of TARA Biosystems, the company aims to capitalize on the need for more predictive technology for testing the safety and efficacy of new therapies and for the discovery of new drug compounds. The company offers testing services on its human stem cell-derived cardiac tissue platform, which is based on its proprietary, patented Biowire Technology.
“New York is the premiere location for the advancement of the life sciences,” said Professor Vunjak-Novakovic. “This investment will allow us to continue to develop lifesaving technologies, and we are thrilled to be establishing our commercial operations at SUNY Downstate among some of the best and brightest in the field.”
Celmatix is a personalized medicine company focused on fertility and women’s health. Celmatix’s products, powered by big data and genomics, enable couples to make more informed, data driven decisions about treatment options when they are struggling to conceive. Celmatix’s mission is to ultimately empower any woman who may want to have a child one day to take proactive steps to maximize her fertility potential from a young age.
“Celmatix is proud to be a leader, not only in the field of reproductive medicine, but also in biotechnology in New York,” said Celmatix Founder and CEO Dr. Piraye Yurttas Beim This support from New York State is tremendously valuable as we scale our operations in New York City.”
The Innovate NY program invested in Lodo Therapeutics Corporation, which develops novel small molecule therapeutics derived from microbial sources, and Petra Pharma Corporation, which develops small molecule inhibitors for the treatment of cancer and metabolic disease, alongside a syndicate of prominent pharma and venture investors, organized by leading life science investment and management firm Accelerator Corp.
“Accelerator is incredibly grateful for the support that it has received from New York State. As we look ahead to launching and investing in new startup companies, it is critically important for us to partner with investors who share a long-term view that it important to build upon and strengthen the life sciences ecosystems that we are a part of. Together, with our impressive syndicate of strategic life science investors, we will work to establish high-quality startup companies in New York City that have the potential to impact global human health. We thank New York State for its commitment to supporting innovation and startup company formation,” said Accelerator CEO Thong Le.
The Innovate NY Fund, which is funded by the U.S. Department of Treasury’s State Small Business Credit Initiative (SSBCI) and Goldman Sachs, is part of the State’s investment program, New York Ventures, which was launched earlier this year to oversee and coordinate the State’s venture capital activity.
ISLIP: LONG ISLAND’S LARGEST INDUSTRIAL CORRIDOR
The Town of Islip has long been known as a leader of economic development in New York. Islip boasts the largest industrial corridor in the Long Island region, major infrastructure advantages over surrounding areas, and an Industrial Development Agency (IDA) that has won renown for its continuous ability to attract new businesses. Though Islip faces many of the same challenges as other municipalities during these harsh economic times, the Town is uniquely suited for economic growth and expansion.
One of the prime reasons for Islip’s attractiveness to local, national, and international businesses is the proximity these businesses have to Long Island— MacArthur Airport (LIMA), which the Federal Aviation Administration has defined as being on-par with LaGuardia Airport and John F. Kennedy Airport. Having a nationally-recognized airport within Islip Town helps our local companies conduct their business more effectively and efficiently. Just as MacArthur Airport helps local businesses expand, the airport itself is working to grow its presence to handle the economic demands of the future. LIMA is serviced by both Southwest and American Airlines and just recently National Airlines announced it will start flying to Puerto Rico in June of 2016.
Just next door to Long Island MacArthur Airport is our Foreign Trade Zone (FTZ). Foreign Trade Zone #52 was created to help businesses with an international scope grow and thrive here in Islip. These companies can utilize the FTZ’s singular economic status to avoid costs associated with importing and exporting goods with other countries. The FTZ sits at the intersection of a crucial transportation hub that features railways, highways, and our commercial airport and is no stranger to new development. In 2013, AA Technology Inc., a growing manufacturer and distributor of circuit boards and electrical components, decided to expand in the FTZ and construct its own 36,000 square foot facility. Because of their strategic location and investment, AA Technology Inc. will enjoy incentives offered by both the FTZ and the Islip Industrial Development Agency.
The Town of Islip has a proud tradition of business success, across a variety of industries. But special mention must be made toward three critical industries that have thrived within our town: technology, food distribution and pharmaceuticals. Many technology companies, spanning sectors from aerospace to telecommunications, have found a home in Islip. All-System Aerospace, a warehouse distributor of helicopter and aircraft parts, has expanded within Islip and leased a larger building that allows them to keep up with market demand. They have remained in Islip largely because our IDA was able to help them adapt and expand to ensure that business was uninterrupted. CPI Aero, a company that manufactures aircraft components, primarily for the U.S. military, was able to expand their operations to a new facility, and also did so with the help of the Islip IDA. Similar to CPI Aero, Sartorius Stedim North America also expanded their operations into a new facility, occupying an additional 40,000 square feet. Sartorius is a leading provider of cutting-edge equipment and services for the biopharmaceutical industry and has invested over $2 million in the build-out and purchase of equipment for a new R&D lab. And most recently, B/E Aerospace, a leading manufacturer of high performance lighting systems for both commercial and business jet aircraft, expanded into a 60,000 square foot facility in Bohemia. In addition to a $1 million investment in equipment, B/E Aerospace also pledges to create 30 jobs within two years.
Additionally, Islip welcomed Ascent Pharmaceuticals in 2012, a pharmaceutical manufacturer whose operations involve research, development and the manufacture, warehousing, distribution of generic prescription medicines in a wide range of therapeutic areas. With the assistance of the Islip IDA, the company, owned by InvaGen Pharmaceuticals, purchased and renovated an existing 250,000 square foot facility for $20 million and they expect to invest another $19 million in additional equipment and research. In return for financial assistance, Ascent has pledged to hire 100 new employees immediately, another 150 in the following 3 years and projects to employ a total of 350 when fully operational within 5 years. Additionally in 2015, Ascent Pharmaceuticals broke ground on two more facilities, across the street from their first project, totaling 340,000 square feet of manufacturing and bottling space and will add 120 new jobs. The story of Ascent Pharmaceuticals is another excellent example of how a company can grow and thrive in Islip, a community that understands the dedication and commitment necessary for projects like this to come to fruition.
Most notably, the world’s largest food distributor, Sysco Inc., constructed a 420,000 square-foot facility in Central Islip. Throughout the entire construction process, from planning, to building, to staffing, Sysco and the Town of Islip worked together to address the needs of both the company and the community. The facility has been fully operational since the summer of 2012, and the demands of the facility have already created over 250 jobs with more to come. Throughout the entire recruitment process, SYSCO has placed a special focus on hiring from within the community. The distribution center boasts many unique features, including a state-of-the-art hydrogen fuel station to power all of the forklifts in the facility. This project has been a model for how local governments, civic groups, and businesses can work together and be proud of the finished product, which will keep all parties satisfied for years to come.
Through all of these developments, the Islip IDA has continuously demonstrated its ability to work with businesses to build partnerships between government, businesses, and residents. As a result of its many accomplishments, the Islip IDA was named the 2011 Suffolk County IDA of the Year by the editorial staff of the Long Island Business News. Islip Town will always be committed to exploring new ways to bring jobs and opportunities to Islip, without losing our identity as a community.
For information on how your business can grow in Islip, please visit www.islipida.com.
THE FUTURE OF MANUFACTURING COMES TO GREATER ROCHESTER
When solar wafer manufacturer 1366 Technologies chose the Greater Rochester, NY region for its new manufacturing operations, it set in motion plans to eventually create 1,000 new jobs at the Science & Technology Advanced Manufacturing Park (STAMP) in Genesee County.
1366 Technologies will build a 3GW wafer facility with a phased approach, starting with a 250MW facility. Over the course of the multi-phase project, 1366 will invest $700 million, including a $100 million initial investment, becoming the largest economic development project in the history of Genesee County, just west of Rochester. It’s also the largest business attraction project Greater Rochester Enterprise (GRE) and the Genesee County Economic Development Center (GCEDC) have ever secured.
“With collaboration between Western New York and Rochester area economic development partners, we employed a multi-regional approach to attract one of the largest expansion projects announced throughout United States in 2015,” said Mark S. Peterson, president and CEO of Greater Rochester Enterprise.
The team at GCEDC led the development of STAMP, which was a critical factor in enticing 1366 Technologies to the region.
“The assets available at STAMP make it the perfect choice for 1366 Technologies,” Steve Hyde, president of GCEDC said. “From millions of gallons of available water, to low cost power to proximity to high quality talent from two of the largest upstate New York cities, the mega site has so much to offer.”
Empire State Development joined the regional economic development organizations in pursuing this project with a competitive incentive package.
“This announcement is an example of how we are combining this region’s natural strengths with our vision to develop New York’s entrepreneurial future and make the Empire State a true leader in developing the clean energy technologies of tomorrow,” said Gov. Andrew Cuomo.
1366 Technologies, which was named one of the top 10 most-innovative energy companies by Fast Company in 2015, aims to drive down the cost of solar electricity. According to Frank van Mierlo, CEO of 1366 Technologies, the company’s technology has the potential to revolutionize the industry.
“The technology is ready and 1366 is squarely positioned to lead in an industry undergoing rapid global growth,” van Mierlo said. “We are extremely proud to become part of the Upstate New York community and are committed to the Finger Lakes region’s vibrant future.”
While 1366 Technologies becomes the sites’ first and anchor tenant, several other companies are exploring expansion projects at STAMP.
STAMP’s unique combination of benefits makes it a competitive site when compared to similar sites across the country. It’s a mega site, offering 1,250-acres of useable property. With its location in Genesee County between Rochester and Buffalo, it provides companies the opportunity to draw talent from a laborshed of more than 1.1 million people as well as to 57 colleges and universities with 300,000 students.
The low-cost hydropower delivered to the site at rate of 3.5 cents per kilowatt hour offers a highly valuable asset for major power users, with the addition of an available, abundant supply of fresh water from the Great Lakes.
“The clean cost of hydropower is an attraction. Secondly, the tremendous talent pool in this region was an important reason to move here,” said van Mierlo, sharing reasons why 1366 picked the Greater Rochester region.
The Greater Rochester Region is home to more than one mega industrial park. Eastman Business Park—formerly known as Kodak Park — has been surging with activity in recent years.
Kodak may have fewer employees than it once did, but it has provided the region with a rare opportunity to attract a diverse array of new businesses that can capitalize on the iconic company’s legacy assets. From its own water treatment system to on-site rail to unique R&D support, EBP provides tenants with unparalleled access to resources not available at most industrial parks.
There are now more than 60 tenant companies at EBP. Manufacturing facilities once used for film and cameras are now producing everything from batteries to beet juice — which a new business venture at EBP, Love Beets USA, will be producing in mass quantities and distributing across the country.
Love Beets is the result of a partnership between LiDestri Foods and UK-based G’s Fresh. This $17-million venture is slated to create 50 new jobs by year’s end, increasing to 140 within five years.
“This joint venture represents a very unique and holistic opportunity to develop a vertically integrated supply chain in Western New York and to bring significant agricultural benefits to the region,” LiDestri CEO Giovanni LiDestri said.
LiDestri has become a food processing powerhouse with its EBP facilities, which produce about 60 percent of the tomato sauces in grocery stores nationwide. A driving force behind the company’s success is the infrastructure available at Eastman Business Park.
And there is still room to grow at EBP — not just for LiDestri, but for any interested businesses. EBP has millions of square feet of office, labs, manufacturing and warehouse space available and about 400 acres of shovel-ready land with large contiguous tracts.