Stony Brook University on Friday officially launched the region’s Innovation Hot Spot program, a state initiative that offers tax breaks, mentoring, education and business development help for startup companies housed in, or affiliated with a half dozen of the Island’s incubator programs.
Administered by Empire State Development and run locally by SBU, the program exempts participating companies from state corporation and sales taxes for five years and provides reduced-rate patent services, help with grant writing and investor pitches and assistance in leaping the many other hurdles facing startup entrepreneurs.
To qualify, a startup must be less than five years old and affiliated with a recognized incubator or accelerator program. On Long Island, the list includes the Entrepreneurial Technology Innovation Center at NYIT, the LaunchPad Long Island chain of co-working spaces, Broad Hollow Bioscience Park at Farmingdale State College, the Morrelly Center in Bethpage and LISTnet’s COMETS mentoring program.
SBU’s incubator programs in Stony Brook and Calverton are also included, as are virtual programs run by any of the designated Hot Spots. Touro Law School and the business and law programs at Hofstra University have agreed to support the Hot Spot program’s education and mentorship goals.
Unlike Startup NY, participating companies don’t have to be physically located in a designated facility as long as they participate in Hot Spot programs, and the benefits are portable should a startup decide to move, even to other parts of the state.
“These are the companies that we think hold the best hope for Long Island’s economic future,” said Ann-Marie Scheidt, Stony Brook’s director of economic development and the force behind the local program. “The Hot Spot program is designed to support starting entrepreneurs who have the heart, the vision, the dreams and are willing to work their tails off to make that future a reality.”
While the corporate tax break may not prove to be a big boost for startups with little or no revenue, the sales tax exemption could offer a significant financial boost for participants investing in equipment or using taxable services.
Aaron Foss, founder of telemarketer-busting technology firm Nomorobo, one of five startups already accepted into the Hot Spot program, said his firm’s annual $600,000 phone bill includes tens of thousands of dollars in sales tax he’ll now be able to use to further expand his business.
“That’s a huge savings,” he said. “You can imagine how valuable that is to a company like mine.”
Peter Goldsmith, the LISTnet chairman and president, also noted that the program connects schools, business, government and the not-for-profit sector.
“We are working hard to create a tech ecosystem in which everyone is focused on the common good,” he said. “The Hot Spot program will allow startups to get the right mentoring and support they need to grow and then remain on Long Island. This is a very important piece that also brings together the universities and industry. It’s really another feather in Long Island’s cap.”