By Jamie Swinnerton
We may not be Silicon Valley, but the Ithaca area isn’t without its own success stories when it comes to helping grow and produce startup businesses. At an event held on Wednesday, June 27, at Rev: Ithaca Startup Works headquarters on East State Street, a conversation was started around the state of Ithaca’s startup economy, a conversation that Tom Schryver, Executive Director of the Cornell Center for Regional Economic Advancement, said was meant to be continued and built upon in the future. But, it was also a little bit about celebrating the startups that have seen success. Rev is a business incubator and workspace opened as a partnership between Ithaca College, Cornell University, and Tompkins Cortland Community College, and was created to give young entrepreneurs mentorship and resources while building their business.
In 2017, Rev’s members raised $21 million in capital, $18.2 million right here in Ithaca; generated $8.2 million in revenue, $7.8 million in Ithaca; and created 92 new jobs, 76 here in Ithaca. In short, it’s Rev’s job to help entrepreneurs and startups navigate the complex waters of creating a business, which includes finding the right investors and gaining capital. But Rev may not always be the best place for a startup to continue growing. Startups that begin their journey in Ithaca may not always stay local. Reasons for moving are numerous: moving the business closer to where the product is produced, finding an investment opportunity in a different city, finding another incubator with different resources that fit better with where the company wants to go, etc. But, just because they may not always continue to grow in Rev doesn’t mean they can’t be ambassadors for other Ithaca and Southern Tier startups. At least, that’s the positive aspect that Schryver sees.
The event’s first panel was made up of investors. Clayton Besch, the director of Empire State Development’s New York Ventures, which provides seed and early-stage funding to high growth startups; Marnie LaVigne, President and CEO of Launch NY, a 27-county venture development organization; and Jennifer Tegan, a partner with Ithaca based Cayuga Venture Fund. The panel was moderated by Jason Salfi, a graduate of Cornell University, an entrepreneur himself and CEO of the solar fuel company Dimensional Energy.
When it comes to finding the entrepreneurs who may be hungry for growth but, for many reasons, may not have the resources to get their dream off the ground, LaVigne said that’s where her company, Launch NY, has found it’s sweet spot. Because the company isn’t attached to one region or one organization, its portfolio is made up of as much as 40 percent minority and women-owned businesses. Partnering with loan providers, she said, has also been a fruitful strategy in finding entrepreneurs who may not have the networks necessary to get funding. All three panelists spoke to the need to be intentional in seeking out opportunities in underserved regions.
A lack of mentors for early-stage businesses is one are that LaVigne sees room for improvement when it comes to helping young businesses in the state.
“We frankly can’t have enough,” she said of mentors. “The innovators are coming up with these brand-new ideas in sectors that are evolving every day.”
For Besch, a common challenge is introducing opportunities to be found to funders outside of the usual suspects, particularly for later stage startups. As an investor, a topic Tegan typically hears is the difficulty of a consumer to invest early in a company they like because companies are waiting longer, until they build up incredible value, before going public.
Real estate was the second panel of the day and the least diverse. Panel members included Phil Proujansky, a founding member of Cayuga Venture Fund, as well as a founding managing partner of the commercial real estate firm Integrated Acquisition & Development; Jeremy Thomas, Senior Director of Real Estate for Cornell University; John Guttridge, founder of Brightworks Computer Consulting, and a member of the Board of the Downtown Ithaca Alliance; and David Lubin, manager of L Enterprises, LLC, a real estate development company in Horseheads.
Finding real estate solutions for startup companies needs can be tricky because these young businesses can outgrow a space very quickly and might have high-tech needs with a startup budget. At Cornell, Thomas said they have found success in this area through a flexible space at the university’s eLab, a class and incubator for student entrepreneurs.
“We are able to sign them up for short-term, year-to-year leases, that’s the model that we have to give,” Thomas said.
Tapping into the ecosystem that these startups grow in is part of the strategy Thomas said the university takes to grow with successful startups. By knowing the ecosystem and where a company will head, and with whom, helps the real estate aspect keep in step with the companies. Being flexible as businesses have to add in new pieces bit by bit has also been a successful strategy.
The entrepreneur panel was moderated by Andrea Ippolito, executive director of the Engineering Management Program at Cornell. The local experts on the panel were Charlie Mulligan, CEO and co-founder of the local fundraising and donor engagement platform GiveGab; Gabriel Rodriguez-Calero holds a Ph.D. in chemistry from Cornell and is the founder of Ecolectro, a chemical company; Julie Baker, co-founder and VP of operations at Ursa Space Systems; and Nick Nickitas, CEO of Rosie, a local eCommerce company born out of Cornell’s eLab.
“Ithaca has a lot of the big city things, without being a big city,” said Rodriguez-Calero, explaining how he would pitch this area to someone interested in growing a startup here. “There’s a lot of art, there’s a lot of culture, there’s a lot of talks and well-renowned speakers that come here, and you don’t have traffic. Well, not a lot of traffic.”
The area is a great place to raise a family, and there’s a lot of talent in the area that startups looking to hire can tap into, Rodriguez-Calero said.
Locally, Baker cited Rev as one of the best resources she had while growing her company. Her company, Ursa, needed the space to grow as a company, which was provided at Rev, and the mentorship and advice from the Rev network.
“It’s not only the resources in the community but who can you be connected with?” Baker said, citing one of the branding firms that came to give a talk at Rev as a connection that her company used later while rebranding. “It’s things like that, it’s the extended network that Rev helps facilitate.”
Ken Rother, Director of Rev, said they plan to hold more events like this one in the future. But until then, Rev hosts local networking nights throughout the year for numerous industries present in the area.
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