LI Angel Network eyes innovation grant

The Long Island Angel Network, an organization that connects investors with entrepreneurs, is to decide this week whether to apply to help the state spend part of $25 million to transfer technology from laboratories and educational institutions into businesses.

If the Angel Network decides to apply, and is selected to participate, it will be one of only four or five organizations throughout the state to help spend the money in what the Empire State Development Corp. calls the Innovate NY Fund.

The fund is part of approximately $50 million in federal money New York State was awarded in September to help small business and overhaul how Albany conducts economic development.

There's about $18 million for banks and community development organizations to lend to small businesses. There's also about $10 million to help small and minority- and women-owned businesses secure bonding.

The money is New York's share of $1.5 billion approved by the Obama administration under the State Small Business Credit Initiative.

Steven Cohen, an ESD deputy commissioner, said the agency in December issued requests-for-proposals seeking four or five investment managers for the Innovate NY Fund. Proposals are due back Feb 21. Cohen said the managers would receive about $5 million each to allocate to business start-ups.

"We have gotten the word out" about the program, Cohen said. "People are talking about it."

Michael Faltischek, Angel Network's chairman, said the group's board will decide on Friday whether to apply. "We are looking closely at the RFP [request for proposal] and for the opportunity to be selected," Faltischek said. No other similar Long Island organizations have so far publicly stepped forward.

Gov. Andrew M. Cuomo in July announced the state had been selected to receive the federal money. Cohen said that so far, the state has received about one-third of the money, and is to receive the rest in thirds later this year. Kenneth Adams, chief executive of ESD, said at a Hauppauge Industrial Association breakfast last week that the public at large is still unfamiliar with much of the initiative.

There is a lot to it. Cohen said that the program is expected to generate $10 in new private lending for every $1 in federal funding. That could come to more than $500 million in new private capital for small businesses to create jobs.

Cohen estimated as many as 10,000 new jobs could be created statewide over a period of several years.