Seven high-tech companies are poised to set up shop in tax-free zones tied to the University at Buffalo, creating dozens of jobs while reaping the benefits of Gov. Andrew M. Cuomo’s Start-Up NY economic development program, The Buffalo News has learned.
Empire State Development is set to approve the applications filed by UB on behalf of the seven companies, which include local and out-of-state firms and range from tiny computer-software startups to an international medical diagnostics company.
The companies are promising to create new jobs in the zones, primarily located in downtown Buffalo, and in exchange will pay no state or local taxes for 10 years.
State and university officials are not releasing details on the initial Start-Up NY participants, pending a formal announcement from the governor expected soon, so a precise accounting of the businesses’ investment in Buffalo, and their job projections, is not yet known.
But it is clear the companies intend to hire at least 100 people over the next five years to work on and near the Buffalo Niagara Medical Campus and in a tech incubator near Canalside.
“We think that Start-Up NY is a great tool for attracting talent,” said Clark Dever, a founder of Heads Up Display, one of several local startups in line to take part in the program.
Executives from the out-of-state companies say a combination of the tax incentives and the opportunity to work closely with UB scientists and physicians drew them to the area.
“I think it’s a testament to Gov. Cuomo and all of the other community leaders who put together the programs that made Buffalo attractive for an emerging company like Sinapis,” said Dr. James Fonger, chief executive officer of Sinapis Pharma, which plans to open a small drug-development office in UB’s Center of Excellence in Bioinformatics and Life Sciences on the Medical Campus.
Like other business executives interviewed for this article, Fonger and Dever said they had not received official confirmation that their companies have been approved for Start-Up NY, but they spoke generally about their interest in the program.
One year ago, Cuomo announced a plan to eliminate sales taxes and property, business and corporate taxes – for a decade – for companies that open on or near State University of New York campuses. Further, their employees would not pay state income taxes for up to 10 years.
Participating businesses must have a connection to the SUNY campuses’ academic missions, cannot move from one part of the state to another, cannot compete with an existing business and cannot displace a campus program.
The seven companies tied to UB are the first in a wave of firms expected to open their doors, expand their existing local operations or move here from out of state to take advantage of Start-Up NY.
UB was the first local school to receive approval for its Start-Up NY sites. The university has 13 tax-free zones that total 177,000 square feet – taken together, they would fit within an average Walmart Supercenter – and has spent the past several months lining up tenants. UB submitted to Empire State Development a list of nine companies that are seeking inclusion in the Start-Up NY program.
Spokesmen for the university and the Governor’s Office declined to comment for this article. But a source who spoke on condition of anonymity provided the identities of seven companies that are set for approval in this first round of the program.
Two of the companies, Aesku Diagnostics and Lineagen, were unveiled in January as partners in a genomic medicine and supercomputing project that links researchers in Buffalo and Manhattan. Both would set up shop on the Medical Campus.
Aesku, which is based in Germany, has operations in Oakland, Calif., and Georgia. The company develops tests and instruments to help in the diagnosis of autoimmune diseases.
The company would develop and manufacture testing kits here and expects to have 50 employees in Buffalo within five years, Aesku officials said earlier this year.
Lineagen, based in Salt Lake City, conducts testing of children with clinical symptoms of autism and other forms of developmental delay. The company said in January that it plans to create eight positions in Buffalo as part of a $5 million investment here.
Sinapis has a handful of employees scattered around the country. The startup grew out of research conducted at the University of Montana that found methamphetamine, administered in low doses to rats, shows promise in treating traumatic brain injuries.
Sinapis is preparing to begin clinical trials in humans and would move at least two employees to the Medical Campus, Fonger said. He said the chance to collaborate with UB neuroscientists, and to enjoy the support of the Governor’s Office, made Buffalo an attractive site.
Three of the companies slated to take part in the program are located in Z80 Labs, a tech incubator on the ground floor of The News.
Decision Pace has developed Web-based software that takes vast amounts of data and converts it into pie charts, bar graphs and other visual formats.
The app is meant to help company decision-makers make better decisions, saving money in the process, said Robin Bronstein, the company’s chief financial officer and vice president of business development. “We’ve got a secret sauce,” he said.
Decision Pace has six employees in Buffalo – nine overall with the company – and ambitiously projects to add 43 jobs here over the next five years, Bronstein said. If Decision Pace is approved for Start-Up NY, the company would move into UB’s Gateway Building, he said.
Another Z80 Labs tenant, Heads Up Display, has produced a device that attaches to standard plastic safety goggles, used on construction sites and in industrial settings, and provides safety information without cluttering workers’ lines of vision with a lot of digital text or graphics.
The device monitors and records noise levels and uses distinct colors and patterns, emitted from LEDs, to remind workers to wear ear plugs or to warn them to leave an area when the volume level is unsafe, Dever said.
The system also can be used to alert workers in case of an emergency in another part of a massive work site.
Heads Up Display hasn’t officially opened for business, and Dever and his cousin, Brendon, don’t yet take a salary. The company would hire the two Devers and a UB graduate student as its first three official employees through Start-Up NY, Dever said. “We’d like to, over the long run, have a manufacturing site in Buffalo,” he said.
The third Z80 Labs startup, Virtuvia, has a web-based application, CoachMePlus, that helps trainers and coaches organize data they collect about their athletes. It’s not know how many employees Virtuvia would hire through the Start-Up NY program.
Also, little is known about the seventh company on the list, Nupur Technologies. The company registered its name with the state Department of State in October, with a Lewiston address, but no further information was available Tuesday.
Buffalo’s first seven Start-Up NY companies (including number of employees and description of the company
Aesku Diagnostics:50 new employees over five years,a German medical diagnostics company.
CoachMePlus: No. of employees not available, a Web-based application that collects data on athletes for coaches and trainers.
Decision Pace: 43 new employees over five years, a startup that developed a Web-based, data-visualization application.
•Heads Up Display: three new employees initially, designed a high-tech, industrial-safety device.
Lineagen: eight new employees initially,performs tests on children who display clinical symptoms of developmental delay.
Nupur Technologies: has registered its name with state Department of State with Lewiston address, further info unavailable
Sinapis Pharma:two or three employees initially, testing the use of low-dose methamphetamine to treat brain injuries.