State Launches Second Annual 43 North Business Competition

Politicians, business leaders and entrepreneurs gathered inside a warehouse-turned-business incubator in downtown Buffalo Wednesday morning to mark the beginning of the state-run business competition 43 North.

Now in its second year, the competition will see ideas from around the globe submitted in hopes that they will be among 11 chosen companies to share in the $5 million in prize money granted as part of Gov. Andrew Cuomo’s Buffalo Billion initiative for Western New York.

Lt. Gov. Kathy Hochul was on hand to sell the governor’s vision of Buffalo as a hotbed for innovation, touting the competition as part of the broader effort to turn the Rust Belt city into “the start-up capital of, not just the nation, but the entire world.”

“We want to be the catalyst for the young talent to come right here,” Hochul said.

Cuomo has touted Buffalo as an economic success story, citing falling unemployment and thousands of new and anticipated jobs in high tech fields like biomedical engineering and renewable energy.

Under Cuomo, the state has moved to subsidize many of those jobs, luring Elon Musk’s SolarCity to Buffalo with approximately $750 million in state assistance, for example. The $5 billion solar panel factory under construction on the Buffalo waterfront site formerly occupied by Republic Steel is expected to create 2,900 permanent jobs and 2,000 construction jobs.

The state is also offering companies that locate on or near participating university campuses to operate virtually tax free for ten years under the statewide Start-Up NY program.

The University at Buffalo has seen 35 companies awarded the tax breaks through the program, with nine of the 11 winners from last year’s 43 North competition among them.

The 43 North prize money comes out of a $6 million grant provided by the New York Power Authority through the sale of excess hydropower. The competition’s operational costs are being paid for with the remaining NYPA money, a $1 million Empire State Development grant and funding from private partners.

Last year’s competition saw nearly 7,000 applicants from around the globe. The 11 winners were each awarded grants ranging from $1 million to $250,000 last October.

The state is accepting applications through June 24 and will again announce the winners in October.

Hochul said that last year’s competition created a buzz about Buffalo as a destination for innovators around the globe and that more applications of “higher caliber” are expected this year.

“The word is out,” she said.

The event also served as the official unveiling of the 43 North incubator, where finalists are offered free office space in an open environment. The state-renovated offices include common space with couches and bistro tables meant to encourage a collaborative environment. 

Last year’s winners, who moved to Buffalo from cities around North America, are now using the space and also have access to support from the 43 North staff, who are charged with helping the entrepreneurs overcome bureaucratic road blocks and otherwise acclimate to the city.

One newcomer to the competition is Executive Director John Gavigan, who recently took over after the departure of Andrew Pulkrabek.

Gavigan, a Western New York native who spent 20 years building companies in the private sector before signing on with the state early this year, said the 43 North staff has worked hard to build a network of organizations offering a wide array of resources to contest winners.

“What we wanted to do is ensure that we were collaborating with many organizations, be it economic development or quality of life organizations in our community, to make sure that these winners have the best that our community can offer,” Gavigan said. 

The 43 North staff also works to facilitate collaboration between the companies that use the incubator space, holding morning meetings and hosting mixers and happy hours in the evenings.

“That’s the whole point of these co-working environments,” Gavigan said, “To just have people introduce themselves and see if there’s a fit.”