By Kate King
Business accelerator IndieBio plans to open a location in New York City next year after securing $25 million in funding from the state.
The accelerator will work with 20 startup companies a year, providing each with an investment of up to $2 million as well as mentorship and business training. The program is part of a broader push by economic development officials to boost the state’s biotechnology, biomedical and pharmaceutical industries.
“You’re talking about a state that is a research powerhouse,” said Howard Zemsky, president of Empire State Development Corp., the state’s economic-development agency. “We have the raw materials here and the assets to translate into commercial enterprise, and that’s the overarching objective.”
Founded in San Francisco three years ago, IndieBio has worked with 90 companies that have gone on to raise more than $165 million in venture capital funding, according to founder Arvind Gupta. The accelerator is looking for a 12,000 to 20,000-square-foot location, preferably in Manhattan near a major transportation hub, that will offer laboratory facilities as well as office space “so science and business can work hand-in hand,” he said.
“There is a huge amount of talent that is untapped potential in New York,” Mr. Gupta said. “Really the challenge will be galvanizing that ecosystem and having it believe there is a new way of starting bio-tech companies that can be lower cost, faster to market.”
Accelerators and incubators are a key component to helping New York capitalize on the scientific discoveries made in the state, said Kathryn Wylde, president of Partnership for New York City, a nonprofit business organization. In the past, scientists often have sold their technology to venture capitalists located in Massachusetts or California, she said.
New York Gov. Andrew Cuomo said in a statement that by welcoming IndieBio to New York, “we are taking a major step forward to ensure that this state remains a global leader for the rapidly growing life science industry.”
Partnership for New York City is investing $10 million from its own fund into New York-based companies that participate in IndieBio’s accelerator and is raising another $40 million from private investors.
“The idea is to create a broad-based venture capital interest that is local,” Ms. Wylde said. “This is a real culture shift for New York’s institutions as they encourage their scientists to turn their discoveries into commercial enterprise and become entrepreneurs.”
The state’s $25 million investment will be delivered over five years and is part of a $620 million initiative that provides tax credits and other investments with the goal of developing a “life sciences” research cluster. New York City also has pledged $500 million to bolster the industry through tax incentives, investments in incubators and a new research and entrepreneurial-training campus.