Powering New York s Startup Ecosystem: An Economic Impact Analysis of NYU-Poly s Incubator Initiatives

Transcription

1 Powering New York s Startup Ecosystem: An Economic Impact Analysis of NYU-Poly s Incubator Initiatives

2 We want New York City to be the most welcoming city in the country for people who want to start a business. The incubator program is a prime example of what government can do to help create that environment and spur job creation. -NYC Mayor Michael R. Bloomberg, August 18, 2011 launching New York City s First Sponsored Incubator at 160 Varick St. 2!

3 Study Overview: NYU-Poly Incubators Changing The Landscape of a City for the Better Creating Successful Businesses Creating Jobs Revitalizing the Local Real Estate Market Supporting Entrepreneurship Generating Wealth 3!

4 The Model Tackling Common Friction Points: Lack of Funding Lack of Affordable Space Hard to Find Engineering Talent Inadequate Information Infrastructure Helping Startups Achieve Escape Velocity through: Capital Customers Expertise Service Multiplied by Community 4!

5 Timeline 2009 Two incubators launched in Hudson Square, Manhattan Varick Street Incubator NYC ACRE (Accelerator for a Clean and Resilient Economy) 2012 Third incubator opens in DUMBO, Brooklyn DUMBO Incubator 5!

6 NYU Poly Incubators by the Numbers 3 Incubators 102Total companies in the incubators since Total jobs generated by incubator activity 59 Companies currently in the incubators 35 Companies graduated to a larger space in NYC 5 Companies acquired $ 60M Raised by incubator companies to date 6!

7 Some Additional Facts Varick Street - Fosters: Adtech, cyber security, financial tech, information tech and social media startups - Current tenants: 30 - Graduates: 26 NYC ACRE - Fosters: Clean tech and green energy startups - Current tenants: 10 - Graduates: 8 DUMBO - Fosters: digital media, mobile and gaming startups - Current tenants: 19 - Graduates: 1 7!

8 Spotlight: NYC ACRE NYC s Flagship Accelerator for a Clean and Resilient Economy NYC ACRE began with a grant from NYSERDA to NYU-Poly which has been extended through 2017 Focus on capital efficient, IT driven energy-related tech 9 ACRE companies were selected for NY Greentech 50 List 112 new full-time jobs created 10 current tenants 8 graduates 2 acquisitions Interest from international clean energy companies establishing a US HQ $22.7 million raised to date 8!

9 Advisors Inaki Berengeur: Co-Founder, Pixable Owen Davis: Managing Director, NYC Seed Shelley Harrison Ph.D: Senior Advisor, Coller Capital Habib Kairouz: Managing Partner, Rho Ventures Evan Korth: Co-Founder, HackNY; Associate Prof. NYU Courant Peter Nager: Senior Managing Director, Egret Capital Laurie Racine: Founder, Managing Director, Startl Ventures Frank Rimalovski: Managing Director, NYU Innovation Venture Fund Mark Wachen: Managing Director, DreamIt NYC 9!

10 Economic Impact Analysis: Methodology The survey was conducted from October 2012-January (All statistics are as of December 2012.) Went to 102 tenants, current and previous. 35 companies responded (a 30% response rate) 24 current tenants 11 graduated companies One-on-one interviews with six selected companies IMPLAN multipliers used Team led by Dr. Jill Kickul at NYU Stern and supporting members from Harley & Co. and Zain Yousaf; experience analyzing incubators all over the world 10!

11 Key Findings Incubators are drivers of significant economic activity Foster production of ground breaking technologies in diverse industry sectors Benefit businesses through public/private participation and academic resources Strengthen NYU-Poly academically Create Good Jobs Attract Significant Capital 11!

12 Economic Impact Through both direct and indirect job creation, taxes and spending, the incubators have had an economic impact of $251.2 million as of December 2012 By 2015, the impact is projected to be $719.8 million 12!

13 Projected Economic Impact: Multipliers Applied Year Total Economic Impact Total Jobs Direct Jobs Indirect Jobs Induced Jobs $251.2M End of 2013 $352.4M End of 2014 $500.1M End of 2015 $719.8M !

14 Projected Economic Impact: Multipliers Applied All data is cumulative and based on extrapolation of survey data to produce employment estimates encompassing all incubator companies Indirect and total job estimates and economic impact based on IMPLAN multipliers 14!

15 Strong Job Creation As of December 2012, NYU-Poly Incubators have created 900 jobs By 2015, NYU-Poly Incubators will have created nearly 2,600 jobs The average graduate of NYU Poly incubator earns $72,230 a year It is estimated that former and current NYU Poly Incubator members contributed $31.4 million in tax revenue from 2009 to !

16 Projected Tax Revenues Year Total State and Local Federal $31.4M $21.0M $10.4M End of 2013 $44.7M $30.1M $14.6m End of 2014 $63.7M $42.9M $20.8M End of 2015 $91.7M $61.7M $30.0M Tax figures include personal (payroll, income, etc.) and business taxes 16!

17 Capital Raised The average funding growth rate for current tenants is 147% There is no shortage of capital once startups leave the incubators More than $60 million in private funds has been raised by incubator companies to date 17!

18 Capital Raised Average Annual Funding and Revenues by Year Current Tenant Graduated Tenant $34,667 $55,000 $213,263 $413,722 $386,455 $364,545 $742,727 $1,898,485 18!

19 Strengthening Local Economies 100% of companies surveyed stated that their firm is headquartered in the NY/NJ region Once they graduated our companies go on to lease an average of 1,671 square feet in New York City 19!

20 New York s Tech Scene is Growing New York ranks 2 nd in total startup activity and 3 rd in venture funding San Francisco Total Startups: 3,442; Apple, Facebook, Google, Twitter $11.8 billion invested in 430 companies 2 - New York Total Startups: 1,844; Foursquare, Tumblr, Fab.com $2.7 billion invested in 332 companies 3 - Los Angeles Total Startups: 1,507; Break Media, Demand Media, Viddy Citysearch $2.0 billion invested in 129 companies 4 - Boston Total Startups: 700; TripAdvisor, Kayak.com, Carbonite $2.8 billion invested in 285 companies 5 - Washington DC Total Startups: 261; LivingSocial $979 million invested in 146 companies 20!

21 The University Connection Allows faculty to work alongside engineers to bring their work to market Brings high-quality work experiences to student interns Provides human capital that tech companies NEED that cannot be found elsewhere 250 Student Positions Created 8 Faculty Engineers in Residence 12 Faculty Consulting Projects 12 Links to Departments, Programs, Center and Labs 21!

22 The Case for University-tied Incubators Our companies are here because of. The opportunity to network. The favorable image and location. The quality, price and flexible terms of the incubator units. The tie to the university; for example, 85% of companies have employed university student interns 84% of companies said that the incubator experience was important or extremely important to their overall success 22!

23 The Incubator Grad students intern for incubator teams Startups get real value, build talent Inspired students emerge with real experience 23!

24 University Progress and Momentum RECORD 9 ARSF AWARDS 11 NYU SCHOOLS" IN 2012 NYU" ENTREPRENEURS CHALLENGE RECORD 9 STARTUPS FORMED BASED ON NYU IP INVENTION DISCLOSURES INCREASE 37% ONE BILLION LICENSING INCOME $ 9 NEW STUDENT ENTREPRENEURSHIP " CLUBS FORMED 24!

25 Good Exits Five Acquisitions (including 3 NYU affiliated companies) totaling over $50 million dollars 25!

26 nrelate: What Success Looks Like Couldn t have done it without the incubator! Oliver Wellington, nrelate Co-Founder Joined the incubator in 2009 Tech based on related content search In their 2 years they: Built their product Developed relationships with publishers Hired key staff Took advantage of everything NYU-Poly had to offer. Acquired by Ask.com (bootstrapped to exit) 26!

27 Power of Partnership The incubators rely a unique, interdependent ecosystem of supportive partners: NYU-Poly: Top Talent and Applied Science NYU: Talent, Support and Resources New York City Economic Development Corp: City Support and Funding New York State Energy Research & Development Authority: Funding Mentors: Access to Network NYC Seed: Brand and Counsel Two Trees Management: Real Estate Trinity Real Estate: Real Estate 27!

28 AREAS FOR IMPROVEMENT 67% of respondents said that they would have taken advantage of a coworking Step-Out space at the incubator NYU-Poly is currently working with NYCEDC and members of the real estate community to address this need 89% of respondents said they would take advantage of a faculty engineer-in-residence program This program launched in January 2013 with 8 faculty and there are plans to scale it across NYU 28!

29 The Path Forward UniversiCes develop new innovacons AJracts talent & funding to university Startups bring new innovacons to market Entrepreneurs give back to university Celebrate entrepreneurial role models 29!

30 Recent Honors !

31 Think Eco Wins Incubator Graduate of the Year 31!

32 NYU-Poly incubators awarded NSF-I Corps Regional Innovation Node NSF program to increase quantity & quality of commercialization efforts Part of NYC Node with CUNY & Columbia - 8 week training program 2x/year to NSF-selected team from other schools - Awarded $1.0m over 3 years Curriculum leveraged for other University City & State programs 32!

33 Summer 2013 Student Launchpad ~10 week summer program to enable 10 student teams from across NYU to focus on growing their startups. Included: - Skill-building bootcamp - Space - Mentorship s by NYC VCs & entrepreneurs - Stipends 33!

34 Contact Micah Kotch Director, Innovation and Entrepreneurship Media: Kathleen Hamilton Marketing & Communications Director 34!