New York State has awarded $1.5 million to a new seed fund designed to invest in downstate companies commercializing research from local laboratories and universities.
The fund will be administered by Accelerate Long Island and the SUNY Research Foundation and will handle investments on Long Island, parts of New York City and the Hudson Valley. The $1.5 million will be matched by the university system’s investment arm and with private money from local venture firms Topspin and Jove Equity Partners.
Under the partnership, Accelerate will handle investments in Nassau and Suffolk, with SUNY RF directing those made in New York City and Dutchess, Orange, Putnam, Rockland, Sullivan, Ulster and Westchester counties.
The partnership had applied for $3 million of the funding, but Empire State Development, the state’s primary economic development arm, decided to split the money with CUNY’s Innovest fund.
The Accelerate-SUNY RF partnership was one of four groups vying for the money, part of an $8 million allocation from the state’s Innovation Capital Fund, which was recently expanded to $100 million.
The state funding comes as Accelerate is completing the award of a separate $1 million in seed funding, a mix of state and private money that has so far gone to six local startups, primarily in the biotech and clean energy fields.
State officials did not immediately answer requests for additional information on the investment program. Accelerate Executive Director Mark Lesko also was not immediately available for comment.
Finding seed funding for local technology startups is considered a major challenge for the region, according to a report published by Accelerate last month. Biotech and clean energy startups – considered the region’s best bets for building the innovation economy – often find it difficult to attract investments due to the high risks and long approval process associated with bringing research to market.