In its quest to become a high-tech hot spot, Long Island has lacked a key element. Money. Specifically, money from deep-pocket investors ready to risk bankrolling researchers with big ideas and startup dreams.
Long Island is home to about 130 tech startups at various stages of development, roughly a quarter in biotech. But the capital they need to fund efforts to move from exciting ideas to profitable businesses has been in short supply. Most startups don't make it, so it's a risky buinsess for investors.
Enter Topspin Partners, Long Island's largest venture capital and private equity firm. It recently joined forces with Accelerate Long Island, a nonprofit working to help commercialize the research coming out of Long Island's major research institutions.
Topspin founder Leo Guthart and its managing director, Steve Winick, have joined the Accelerate Long Island board, and the firm will help finance the Long Island Emerging Technologies Fund. Accelerate Long Island has $500,000 from the state to provide up to $50,000 each to early stage startup companies. But the grants require private matching funds. The Long Island Emerging Technologies Fund will provide the other $500,000, about half from Topspin, enabling Accelerate Long Island and its executive director, Mark Lesko, to direct as much as $100,000 each to embryonic companies.
While that's peanuts in the biotech sector -- where much of the promising startup action is happening -- it's critical seed money that fledgling companies need to reach the point where they can attract wealthy investors.
Topspin, a $213-million fund, is itself one of those investors. Its alliance with Accelerate Long Island should help ideas and money find one another.
Accelerate Long Island has a pipeline to ideas. It's a collaboration among Brookhaven National Laboratory, Cold Spring Harbor Laboratory, Hofstra University, North Shore-Long Island Jewish Health System's Feinstein Institute and Stony Brook University, which are home to $1.2 billion a year in research.
That's a rich pool for Accelerate, which trolls for people with exciting ideas with commercial potential. Topspin will now share those connections which promote relationships that build the confidence to drop enough cash to really get startups off the ground.
Topspin is already a local player. It has invested in companies including Certerra Inc. and Mirimus Inc., two spinoffs from the Cold Spring Harbor Laboratory; ThermoLift Inc., located at the Stony Brook University Advanced Energy Center; and SetPoint Medical Inc., founded by the director of the Feinstein Institute. But the fund's alliance with Accelerate Long Island should be a launching pad for much more.
Not that building a local tech hub will be easy. The nationwide scrum to be the next breakout region is fierce. Technology is a powerful economic engine and everybody wants a ride.
But Long Island's educated workforce, universities and cutting-edge research facilities give it a competitive advantage. So does proximity to New York City, which announced last month a new $100-million venture capital fund for life sciences, and construction of the Mount Sinai Institute of Technology.
Multiple bio-tech startups and companies in the city and on Long Island would create the critical mass of employment opportunities that allows high-tech employees to try their luck at one company and, if it fails, move to another without having to leave the region.
But a tech future for Long Island will also require making this a place that young people with skills in demand in the industrywill want to call home. That means creating housing choices that work for singles and young couples not ready to buy that first suburban home, and communities that provide easy access to the restaurants and entertainment they crave.
Nurturing bio-tech on Long Island will be a labor of faith and persistence. It could take a generation. But the Island has made an important start. It's become fertile ground for high-tech seedlings struggling to take root.